Company Loses $85M Because of Patent ReExam

On Friday, the US Court of Appeals for the Federal Circuit vacated an award of $85M in damages which followed a jury verdict of infringement of US Patent No. 5,162,666. The '666 patent covers certain multiplexers, a type of logic circuit with multiple inputs, one or more control lines, and one output. Claims16, 17, 39-45, 47&48 of the '666 patent were found obvious under 35 U.S.C. 103(a) in a decision from the same panel of the court, Judges Mayer, Rader, and Prost. The Court's obviousness decision affirmed a prior ruling of invalidity made by the U.S. Patent and Trademark Offices Board of Appeals and Interferences, which had affirmed an examiner's rejection made in a reexamination proceeding. The Reexam was filed June 4, 1999, following an infringement case brought by the owner of the '666 patent, Beaverton Oregon Company, Translogic Technology, Inc. on March 24, 1999 in the District of Oregon (No. 99-407-PA) against Hitachi. Instead of staying the district court case in view of the Reexam, Translogic pushed ahead, winning a jury verdict that the claims of the '666 patent were not invalid in October 2003 and a subsequent verdict of infringement by Hitachi in May 2005 and an award of $85M in damages. The District court also entered a permanent injunction which was stayed by the Federal Circuit pending appeal. Only claims 16 and 17 of the '666 patent were litigated by Translogic to verdict.