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Use of Canadian BlackBerry™ System in U.S. May Infringe Under 35 U.S.C. § 271(a)

December 14, 2004

Decision icon Decision

Last Month at the Federal Circuit - January 2005

Judges: Linn (author), Michel, and Schall

In NTP, Inc. v. Research in Motion, Ltd., No. 03-1615 (Fed. Cir. Dec. 14, 2004), the district court made several rulings concerning a jury’s verdict that Research in Motion, Ltd.’s (“RIM”) BlackBerry™ system infringed five patents owned by NTP, Inc. (“NTP”). Specifically, the Federal Circuit ruled that the district court had erred in construing a certain claim limitation but correctly found that infringement could lie under 35 U.S.C. § 271(a). The Court remanded the case for the district court to determine whether an infringement verdict should be set aside based on the new claim construction and for a corresponding new damages award.

The patents-in-suit concern a wireless electronic mail system that pushes e-mail to an end user. The district court granted SJ of infringement on certain claims, and a jury returned a verdict of infringement on other claims. The jury awarded damages in the amount of approximately $23M. The district court then modified the damages award for compensatory damages, attorney fees, prejudgment interest, and enhanced damages to a total of more than $53M.

Initially, the Federal Circuit declined to address RIM’s argument that the claims are limited to pull technology because RIM had failed to raise this argument before the district court. Instead, the Court addressed RIM’s argument that the term “electronic mail system” cannot include wireless connections, concluding that such a contention contradicts the text and the figures of the written description.

The district court had found that the claim term “originating processor” meant “any one of the constituent processors in an electronic mail system that prepares data for transmission through the system.” The Federal Circuit ruled that this construction was erroneous, concluding instead that the term properly construed means “a processor in an electronic mail system that initiates the transmission of a message into the system.” Although the Federal Circuit expressly stated that it does not hold that the originating processor is always the processor on which text of the e-mail message was created, it recognized that as a practical matter, this will probably be the case. The Court specifically ruled that a gateway switch is not an originating processor.

The Federal Circuit ruled that given its new claim construction of the phrase “originating processor,” the full scope of infringement remained unclear, and, therefore, the Court remanded the case for development of this evidence.

RIM argued that certain steps of the allegedly infringing activity took place outside of the United States because the BlackBerry™ relay component of the accused system is located in Canada. RIM asserted that the entire accused system and method must be contained or conducted within the territorial bounds of the United States for § 271(a) to apply. The Federal Circuit ruled, however, that when two domestic users communicate via their BlackBerry™ devices, their use of the BlackBerry™ system occurs within the United States, regardless of whether the messages exchanged between them may be transmitted outside of the United States at some point along their journey. Even though one of the accused components in RIM’s BlackBerry™ system may not be physically located in the United States, the Court reasoned, it is beyond dispute that the location of the beneficial use and function of the whole operable system assembly is in the United States. The location of RIM’s customers and their purchase of the BlackBerry™ devices establish control and beneficial use of the BlackBerry™ system within the United States and satisfactorily establish territoriality under § 271(a).