CAFC Affirms District Court - Two Verizon Patents Invalid and Four Not Infringed

On April 16, 2010 the Court of Appeals for the Federal Circuit ("CAFC") upheld the District Court for the Eastern District of Virginia jury verdict that the asserted claims of two Verizon patents (US Patents 6,282,574 and 6,104,711) were invalid and the asserted claims of four Verizon patents (US Patents 6,430,275; 6,292,481; 6,137,869 and 6,636,597) were not infringed.  See Verizon Services Corp. et al. v. Cox Fibernet Virginia, Inc. et al., 2009-1086, -1098 (CAFC, April 16, 2010).

The six patents at issue relate generally to packet-switched telephony ─technology for providing telephone calls by breaking up voice signals and sending the resulting data in packets, not all of which need traverse the same path, through a network. Packet-switched telephony increases the efficiency of the underlying network over traditional circuit switching, which relies on a dedicated path between endpoints of a call.

On appeal, both parties challenged the district court’s denial of their respective motions for judgment as a matter of law and motions for new trial.

US Patents 6,282,574 and 6,104,711 both relate to a server with an expanded variety of translation services over a traditional domain name server, allowing for a wider range of routing options over packet-switched networks. This additional functionality allows providers of VOIP to offer enhanced features, such as call-forwarding and voicemail, to which users of traditional telephone service have become accustomed.
 

US Patents 6,430,275; 6,292,481 and 6,137,869 provide for bundling the traditionally separate databases of usage recording, pricing, and authorization into a single logical database in order to ensure scalability of the system, reduce the potential for fraud, and allow mechanisms for network support infrastructure, pricing, call flow, and billing.

US Patent 6,636,597 provides a method for providing services over a packet-switched network by dynamically allocating resources to vary the quality of service on a call-by-call basis.

In 2003, Cox began to provide telephone service over its private cable network using a packet-switched technology called PacketCable.  In January 2008, Verizon sued Cox for willfully infringing its patents by deploying Cox’s packet-switched telephone service.

Verizon argued that Cox improperly argued to the jury about the scope of the claims.  Specifically, Verizon alleged that Cox and it experts repeatedly argued that the scope of the asserted claims was limited by the intent of the inventors.  The CAFC rejected Verizon's arguments stating: "we are not persuaded that the district court abused its discretion by refusing to order a new trial on the basis of Cox’s arguments to the jury. Validity and infringement were vigorously litigated, with extensive testimony, physical exhibits, and argument from both sides." Slip op. at 13.  The CAFC added, "Verizon did not, during the trial, request a limiting instruction based on Cox’s allegedly improper claim scope arguments. Nor did Verizon object to any arguments made during Cox’s closing. Finally, Verizon had the opportunity, in its own closing, to rebut any improper or misleading statements it perceived in Cox’s closing arguments but instead said nothing."

The CAFC also affirmed the District Court's verdict of obviousness of the asserted claims of US Patents 6,282,574 and 6,104,711 based on expert testimony that related to public domain articles concerning the claimed elements.

Verizon's arguments that Cox infringed claim 1 of US Patent 6,292,481 were rejected by the CAFC because the evidence did not prove that Cox's system included all elements of the asserted claim.