by Dennis Crouch
Ericsson Inc., et al. v. TCL Communication Technology Holdings Limited, et al. (Supreme Court 2021)
A jury sided with Ericsson with a $75 million verdict for the patentee. (See the verdict image above). On appeal, the Federal Circuit flipped the verdict — holding that the asserted patent was ineligible under Section 101. In a new SCT petition, Ericsson challenges the decision on procedural grounds — arguing that TCL did not properly preserve the eligibility issue for appeal. In particular, Ericsson argues for waiver because the defendant did not raise the issue in a post-verdict R.50(b) motion for Judgment as a Matter of Law.
During the litigation, TCL had argued that Ericsson’s claims were ineligible under Section 101. Before trial the district court denied TCL’s motion for summary judgment. TCL did not raise the issue again at trial or in a motion for JMOL under either R.50(a) or R.50(b).
Normally, denial of summary judgment does not preserve an issue for appeal. Rather, the moving party must follow up with a pre-verdict motion for JMOL and then a post-verdict renewed-JMOL motion. Unitherm Food Sys., Inc. v. Swift-Eckrich, Inc., 546 U.S. 394 (2006); Ortiz v. Jordan, 562 U.S. 180 (2011).
Oritz is parallel to TCL’s case but involves a Civil Rights action under Section 1983. In Oritz, a the defendants filed a summary judgment motion on qualified immunity grounds, but that motion was denied prior to trial. The plaintiff then won a jury verdict at trial and the defendant did not re-raise the qualified immunity question in a post-verdict JMOL motion. On appeal, the Sixth Circuit flipped on the issue of qualified immunity — thus excusing the defendants. In its decision, the appellate panel noted the usual rule that appellate courts “normally do not review the denial of a summary judgment motion after a trial on the merits.” However, the appellate court found qualified immunity to be a special situation and went-ahead to review the SJ decision. The Supreme Court disagreed with the Sixth Circuit — holding that the appellate panel had no power to review the summary judgment denial.
We granted review to decide a threshold question on which the Circuits are split: May a party, as the Sixth Circuit believed, appeal an order denying summary judgment after a full trial on the merits? Our answer is no. The order retains its interlocutory character as simply a step along the route to final judgment.
Ortiz v. Jordan, 562 U.S. 180, 183–84 (2011).
In TCL’s case, the Federal Circuit distinguished Ortiz by identifying a different exception for situation where the “disputed issue concerns a pure question of law.” In its analysis, the Federal Circuit purported to follow Fifth Circuit law — because this issue is procedural and the case stems from Texas. The appellate panel explained that the Fifth Circuit continues to allow appeals from S.J. denial when the issue being appealed is a pure question of law that would not have been raised at the jury trial. Note here that the Federal Circuit decision does not distinguish or even cite to the Supreme Court’s most recent statement on-point, Ortiz.
A key element of the majority decision is that – for a question of law – denial of summary judgment of ineligibility fully decides the issue and acts sub silento to effectively grant summary judgment of eligibility. “[T]he district court here did not merely deny summary judgment. Rather … it effectively granted summary judgment in favor of the non-moving party by deciding the issue and leaving nothing left for the jury to decide.” The Federal Circuit majority opinion was written by Chief Judge PROST and joined by Judge CHEN.
Judge NEWMAN wrote in dissent and argued that the majority erred in its approach to summary judgment motions — “The majority announces new law and disrupts precedent.”
All this sets up the new petition for writ of certiorari that asks two questions:
1. Whether, notwithstanding the ordinary rule that a pretrial denial of a motion for summary judgment is not reviewable on appeal, there is an exception for summary judgment decisions that turn solely on “legal issues.”
2. Whether an order denying summary judgment can be reviewed following trial, at the discretion of the court of appeals, notwithstanding a party’s failure to seek judgment as a matter of law on those grounds under Rule 50.
[Ericsson Petition for Writ of Certiorari] [Federal Circuit Decision].
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U.S. Patent No. 7,149,510, Claim 1:
1. A system for controlling access to a platform, the system comprising:
a platform having a software services component and an interface component, the interface component having at least one interface for providing access to the software services component for enabling application domain software to be installed, loaded, and run in the platform;
an access controller for controlling access to the software services component by a requesting application domain software via the at least one interface, the access controller comprising:
an interception module for receiving a request from the requesting application domain software to access the software services component; and
a decision entity for determining if the request should be granted wherein the decision entity is a security access manager, the security access manager holding access and permission policies; and
wherein the requesting application domain software is granted access to the software services component via the at least one interface if the request is granted.