United States: Dismissal Without Prejudice May be Final Judgment; The Term "Circuit" Denotes Structure Sufficient to Avoid §112, ¶6 Interpretation

The U.S. Court of Appeals for the Federal Circuit, following vintage case U.S. Supreme Court precedent, held that dismissal of a case without prejudice is a final judgment under the final judgment rule and is therefore appealable. Linear Technology Corp. v. Compala Linear Corp., Case Nos. 02-1569,-1576 (Fed. Cir. Jun. 17, 2004) (Linn, J.).

This case involved a patent related to switching voltage regulators. In 1997, Linear sued various companies for patent infringement. In 1999, the district court issued a claim construction order construing all asserted claims. In 2001, a different court issued an order granting summary judgment of non-infringement in favor of one of the defendants, Maxim Integrated Products but denying Maxim’s cross-motion for summary judgment that a certain Ronald Vinsant was the inventor of the patent-at-issue. The district court had earlier issued the claim construction order, and then later entered final summary judgments under Fed. Rule of Civ. Proc. 54(b) in favor of three defendants including Maxim. It also issued an order certifying an interlocutory appeal of the claim construction determinations for a fourth defendant, Analog Devices, Inc. Analog had not sought summary judgment therefore no judgment was entered concerning it.

Linear and Analog unsuccessfully sought permission from the Federal Court to proceed with the interlocutory appeal. The Federal Circuit also dismissed the appeals as to the three defendants who had received final summary judgments of non-infringement. Subsequently, Analog and Linear stipulated to the dismissal of all claims against Analog without prejudice. The remaining parties sought re-entry of the summary judgments and the district court entered new final judgments of non-infringement in favor of the remaining defendants. Linear then settled with one defendant leaving Maxim and the inventor, Vinsant (a counterclaim defendant) as the only remaining adverse parties in the litigation. Linear again appealed the summary judgment in favor of Maxim.

Maxim objected to the appeal, arguing that the court lacked jurisdiction because, under Rule 54(b), there had been no final judgment adverse to Analog due to the stipulated dismissal without prejudice. The traditional rule in federal courts has prohibited piecemeal litigation and permitted appeals only from final judgments. At the time the first appeal was lodged, Analog remained a party to the litigation with Linear’s unresolved infringement claims pending against it. Thus, the Federal Circuit reasoned, Linear’s earlier appeal was rightfully denied because one of the parties (Analog) had an interlocutory appeal pending rendering the whole litigation unappealable under the final judgment rule. However, now that Analog was dismissed without prejudice, Linear’s new appeal presented the Federal Circuit with a final appealable judgment giving the court jurisdiction under 28 U.S.C. §1295(a)(1).

Turning to the merits of the appeal, the patent in issue is directed to "switching" voltage regulators, which are devices having switches (transistors) that are turned on and off in such a manner as to provide a predetermined and constant voltage output from a fluctuating input voltage source. To ensure a steady flow of current pulses, control circuitry is used to turn the transistors on and off. The patent discloses a "sleep mode" where switching transistors are turned off to reduce the power consumed by the regulator itself to improve the regulator’s efficiency. The patent also discloses a current reversal prevention mode where the regulator prevents a reverse flow of electrical current to prevent power from being drained from the load.

The parties disputed whether certain "circuit" and "circuitry" limitations in the patent claims were means-plus-function limitations. The district court rejected Linear’s expert testimony that the word "circuit" used in the claim would be understood by persons of ordinary skill in the art to connote sufficient structure to perform the recited function, and ultimately concluded that these limitations were means-plus-function limitations subject to §112, ¶6.

The Federal Circuit reversed. The Court began its analysis by noting that a claim term that does not use the word "means" triggers the rebuttable presumption that §112, ¶6 does not apply. The district court’s failure to apply this presumption was found to be legal error. Rather, the district court should have imposed on Maxim, which advocated a §112, ¶6 construction, the burden of overcoming the presumption by demonstrating that the claim fails to "recite sufficiently definite structure" or recites a "function without reciting sufficient structure for performing that function."

Next, the Court proceeded to analyze the claim terms in issue, along with the description, finding that the claim term "circuit," together with the functional recitation, provided structural meaning to persons of ordinary skill in the art. Thus, applying the presumption, the Court held that §112, ¶6 did not apply to the "circuit" limitation. Accordingly, the district court’s holding to the contrary was found to be in error. On that basis, the grant of summary judgment was vacated and case was remanded.

A request for rehearing on the §112, ¶6 issue has been filed by Maxim.

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