Network-1 Techs., Inc. v. Hewlett-Packard Co. (Fed. Cir. Nov. 20, 2020) (modified opinion) (US6218930 – providing power via ethernet cable)
This case has gone back-and-forth several times. Here are a few highlights:
- PTAB instituted IPR on likelihood of invalidity, but then concluded the claims were not proven invalid.
- Later, in the infringement lawsuit, jury found the claims invalid.
- Judge Schroeder (E.D.Tex.) rejected the jury verdict – holding that HP was estopped from challenging validity under 35 U.S.C. § 315(e)(2). (Granting renewed motion for JMOL under R.50(b).)
- Then on appeal, the Federal Circuit vacated JMOL but did not expressly reinstate the jury verdict – seemingly leaving that for Judge Schroeder to decide what to do. (Sept 2020 decision).
An additional problem with Judge Schroeder’s decision below is that he did not rule on Network-1’s conditional motion for new trial as required by R.50(c):
If the court grants a renewed motion for judgment as a matter of law, it must also conditionally rule on any motion for a new trial by determining whether a new trial should be granted if the judgment is later vacated or reversed.
Fed. R. Civ. Pro. R. 50(c). In addition to the new trial motion, Judge Schroeder also made no ruling on other substantive JMOL motions filed by Network-1.
The remand order demanded the district court proceed in a manner “consistent” with the appellate decision. However, Network-1 foresaw some conflict and argument regarding how that order might be interpreted. In particular, HP wants the district court to simply reinstate the Jury Verdict of invalidity; while Network-1 wants the district court to rule on its alternative JMOL motions or alternatively order a new trial on validity. As such, Network-1 petitioned the Federal Circuit for a clarifying order:
To avoid any possible confusion on remand, Network-1 respectfully asks the panel to clarify that its remand includes deciding Network-1’s motion for a new trial and addressing Network-1’s remaining arguments for JMOL on validity— including significant evidentiary shortcomings that no court has yet to address given the district court’s estoppel ruling.
Network-1 Petition for panel rehearing.
The court has granted the petition and now expressly stated:
We therefore remand to the district court for further proceedings consistent with this opinion, which include ruling in the first instance on Network-1’s entitlement to JMOL (notwithstanding this court’s holding on estoppel) and its new-trial motion.
Modified opinion (underlined portion is the new part). The court also explained that the appellate panel “will not consider either Network-1’s alternative grounds for JMOL or its new-trial motion in the first instance.”
In its briefing, HP explained its position that Network-1 had forfeited its right to make its renewed-JMOL motions on sufficiency of the validity evidence because Network-1 had failed to raise that particular challenge in its R.50(a) motion.
[A] party that fails to move for judgment as a matter of law under Rule 50(a) on the basis of insufficient evidence at the conclusion of all of the evidence waives its right to file a post-verdict Rule 50(b) motion, and also waives its right to challenge the sufficiency of the evidence on appeal.
Moss v. Princip, 913 F.3d 508, 522 (5th Cir. 2019). In its rehearing order, the Federal Circuit did not decide the forfeiture issue, which will be open for debate back before the District Court. (Note issue of waiver vs forfeiture).
Network-1 had requested that the Federal Circuit order the district court to consider “Network-1’s previously asserted substantive grounds for JMOL” and did not mention the forfeiture issue. Although not entirely clear, it appears that this requested order might have overcome the potential waiver. The Federal Circuit was careful to require only examination of Network-1’s “entitlement to JMOL” without requiring that the merits of the motion be considered.