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Use Recited in Claim Preamble Found Not Limiting

May 08, 2002

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Last Month at the Federal Circuit - June 2002

Judges: Rader (author), Mayer, and Prost

In Catalina Marketing International, Inc. v., Inc., No. 01-1324 (Fed. Cir. May 8, 2002), the Federal Circuit vacated a district court’s SJ of noninfringement, given the district court’s erroneous reliance on nonlimiting language in the preamble of one claim and prosecution history estoppel.

U.S. Patent No. 4,678,041 (“the ‘041 patent”) claims a selection and distribution system for discount coupons. In a preferred embodiment, the system dispenses coupons to consumers at remote, kiosk-like terminals connected to a central computer system. When a consumer activates the terminal in a retail outlet, the terminal displays available coupons on the screen. The consumer selects a coupon, and a printer connected to the terminal prints the coupon. The terminal selectively communicates with the central computer system to acquire coupon information for display. The preamble of claim 1 recites a plurality of remote terminals located at predesignated sites, such as consumer stores.

During prosecution of the ‘041 patent, no amendments were made relating to the location of the terminals; however, applicants stated that their invention involved terminals “located in stores” for the dispensing of coupons “on-site.” However, applicants did not argue that the location of the terminals in stores distinguished the invention from the cited prior art., Inc. (“Coolsavings”) uses a web-based coupon system to monitor and control the distribution of coupons. After registering and providing demographic data, users can browse the website for available coupons and then select and print coupons for in-store redemption. A centralized computer system stores coupon and user data. Users may access the system from any Internet-accessible computer.

Catalina Marketing International, Inc. (“Catalina”) sued Coolsavings, alleging that Coolsavings’s web-based coupon system infringed the ‘041 patent. The district court construed the claim language “located at predesignated sites such as consumer stores,” as recited in the preamble of claim 1, as requiring the terminal to be placed at a predesignated site at the point of sale, for example, a consumer store. Due to this construction, the district court concluded that Coolsavings did not infringe claim 1, either literally or by the DOE.

On appeal, Catalina argued that the disputed language, which only appears in the preamble of claim 1, is not a limitation because it merely states an intended use for the claimed system.

After reviewing its precedents concerning the effects of preamble language on claims, the Federal Circuit concluded that preambles describing the use of an invention generally do not limit the claims because the patentability of apparatus or composition claims depends on the claimed structure, not on the use or purpose of that structure. The Court stated that a patent grants the right to exclude others from making, using, selling, offering for sale, or importing the claimed apparatus or composition for any use of that apparatus or composition, regardless of whether the patentee envisioned such use.

The Federal Circuit held that the claims, specification, and prosecution history of the ‘041 patent demonstrate that the preamble phrase “located at predesignated sites such as consumer stores” is not a limitation to claim 1. During the prosecution of the ‘041 patent application, the applicant did not rely on this phrase to define the invention or to distinguish the prior art. The Court found that this phrase is not essential to understanding limitations or terms in the claim body. The deletion of the disputed phrase from the preamble does not affect the structural definition or operation of the terminal because the claim body defines a structurally complete invention.

As to the other asserted claim, claim 25, language like that of the preamble also appeared in the body of claim 25. Accordingly, the Federal Circuit reviewed the district court’s construction of this language with respect to claim 25. In doing so, the Federal Circuit reversed the district court’s claim construction and ruled that the phrase “located at predesignated sites such as consumer stores” required designation of the physical position of the terminal before placement of the terminal at a point of sale location.

Concerning infringement, because the district court had improperly construed the foregoing phrase as a limitation of claim 1, the Federal Circuit vacated the judgment of no literal infringement of claim 1 and remanded fora complete claim construction of claim 1 and appropriate infringement proceedings.

With respect to claim 25, based on its claim construction, the Federal Circuit determined that Coolsavings had not literally infringed claim 25. The Court remanded, however, for proceedings concerning infringement under the DOE. In particular, the district court must now determine whether Coolsavings’s Internet addresses for computers accessing the Coolsavings website are insubstantially different from the placement of terminals at predesignated points of sale. The Court ruled that prosecution history estoppel did not preclude Catalina from pursuing the DOE on this issue.