Cisco Foe Brings Patent Case to Washington

WASHINGTON (CN) - The Supreme Court took up a case Friday where a company was ordered to retry patent claims against Cisco Systems after winning $63 million from a jury.

Commil USA brought its federal complaint in August 2007, accusing Cisco of infringing on its patent for Wireless Private Branch Exchange (WPBX) and Communicating Between Mobile Units and Base Stations.

Though a jury in Marshall, Texas, awarded Commil $3 million for direct infringement in May 2010, Commil failed to convince the same jury that Cisco induced infringement.

Commil retried its case in April 2011, this time obtaining a $63 million verdict after persuading the jury that Cisco had induced infringement.

The Federal Circuit upended that verdict last year, however, because of an erroneous instruction given to the jury regarding indirect infringement.

"With respect to whether the induced acts constitute patent infringement, it is clear that the jury was permitted to find induced infringement based on mere negligence where knowledge is required," the lead opinion said. "This erroneous instruction certainly could have changed the result. Facts sufficient to support a negligence finding are not necessarily sufficient to support a finding of knowledge. Accordingly, we vacate the jury's verdict on induced infringement and remand for a new trial. Because we vacate the induced infringement verdict upon which the damages award is based, we also vacate the damages award."

The ruling also cited "ample evidence from which the district court could conclude that the jury was biased by Cisco's actions."

"Throughout trial, Cisco attempted to instill in the jury, through irrelevant references to ethnicity and religion, an 'us versus them' mentality," the appellate court found. "Cisco persisted in its course of conduct even after the court warned counsel and issued a curative instruction. And, in a case involving Jewish inventors and plaintiffs, Cisco's counsel began his closing argument with a reference to the trial of Jesus Christ."

Two members of the three-judge panel dissented in part, and several judges dissented in October as well when the court refused to consider the case en banc.

Per its custom, the Supreme Court did not issue any comment in granting Commil a writ of certiorari on Friday.

It agreed to consider "whether a good-faith belief that a patent is invalid is a defense to inducement liability under Section 271(b)" of Title 35.

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