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Court Clarifies Issues of Waiver and Estoppel Concerning Arguments on Appeal

July 13, 2001

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Last Month at the Federal Circuit - August 2001

Judges: Linn (author), Plager, and Schall

In Interactive Gift Express, Inc. v. CompuServe Inc., No. 99-1324 (Fed. Cir. July 13, 2001), the Federal Circuit replaced its earlier opinion, Interactive Gift Express, Inc. v. CompuServe Inc., 231 F.3d 859 (Fed. Cir. 2000), with a modified opinion to address issues of waiver and judicial estoppel after granting a petition for panel rehearing. The modification, however, did not affect the outcome of the Court’s previous decisions on claim construction or the disposition of the case.

In its original opinion, the Federal Circuit had reversed a district court’s claim construction of U.S. Patent No. 4,527,643 owned by Interactive Gift Express, Inc. (“IGE”) (now known as E-Data Corp.), which discloses methods and systems for reproducing information in material objects at point of sale locations. The Court rejected the district court’s attempts to read into the claims features from detailed systems described in the patent specification. The Federal Circuit disagreed with the district court’s construction of five contested claim limitations, reversed the stipulated noninfringement finding, andremanded the case for further proceedings consistent with its claim construction. [The original opinion is summarized in our December 2000 issue of “Last Month at the Federal Circuit.”]

In its substitute opinion, the Federal Circuit considered whether IGE’s claim construction position on appeal was subject to waiver or judicial estoppel.

With respect to claim construction, the doctrine of waiver dictates that a party may not advocate a new claim construction that changes the scope of the claims on appeal. The Federal Circuit held that the doctrine of waiver does not, however, prevent a party from clarifying or defending the original scope or supporting its existing claim construction position with new arguments based on the patent specification. As applied to the facts of this appeal, the Court ruled that IGE’s new arguments on appeal were based on the specification and did not modify the scope of its argued claim construction. As to judicial estoppel, the Federal Circuit pointed out that the petitioning Appellees did not contend that IGE had succeeded at trial and then reversed its position. Accordingly, the Court found that IGE was not judicially estopped from making any of its arguments regarding claim construction.