One Deleted Term, One Case Lost

In DDR Holdings, LLC v. Priceline.com LLC, No. 2023-1176 (Fed. Cir. Dec. 9, 2024), the Federal Circuit affirmed a judgment of non-infringement. 

The dispute centered on the construction of “merchants” and “commerce object.” DDR sought a construction for both terms that included both products and services. The district court construed the terms to only include products.

The Federal Circuit affirmed, relying on the patent’s specification and the related provisional application. The specification only used the disputed claim terms in in the context of products without mentioning services. However, the specification incorporated by reference the provisional application, which defined merchants as selling either goods or services. Because there is a progression from a provisional to an issued patent, the Court determined the deletion of a term to be significant. The patentee chose to delete references to “products or services” and chose to define merchants as purveyors of goods alone. Therefore, the Federal Circuit excluded services from the construction of the disputed terms.

The Federal Circuit also rejected DDR’s collateral estoppel argument based on the Board’s construction because DDR failed to raise the argument in its opening brief on appeal or during claim construction at the district court. Moreover, the Federal Circuit noted that neither it nor the district court was bound by the Board’s constructions because the Board had applied the broadest reasonable interpretation standard rather than the Phillips standard.