A Free Speech Right to Accuse Others of Patent Infringement

by Dennis Crouch

Rule 1 of the Federal Rules of Civil Procedure sets out a bold goal for civil litigation: “the just, speedy, and inexpensive determination of every action.”  Patent litigation is rarely speedy; quite expensive; and, many would argue, often unjust.  In the case below, one party attempted some quick relief via preliminary injunction, but the Federal Circuit has vacated on free-speech grounds.

Light-Netics owns U.S. Patent Nos. 7,549,779 and 8,128,264 that cover easy-to-hang Christmas lights. These lights include a magnetic backing that can attach easily to metal surfaces (such as a metal roof).  Light-Netics sued after discovering competing products on sale from Holiday Bright Lights (HBL).  And, in addition, Light-Netics sent a notice to various light stores warning them that HBL lights were infringing. Lite-Netics LLC v. Nu Tsai Capital LLC (DBA Holiday Bright Lights), — F.4th — (Fed. Cir. 2023). 

Light-Netics sued for infringement, HBL responded with unfair competition counterclaims. The district court quickly issued a TRO followed-up with a preliminary injunction against the patentee.  Judge Buescher (D.Neb.) ordered the patentee to (1) stop publicly stating that HBL copied the invention and (2) stop telling HBL customers that they could also be liable for infringement.   Part of the district court’s justification here was a preliminary consideration of the merits of the lawsuit: narrowed claim construction eliminated literal infringement; and a finding that the patentee was estopped from asserting DOE.   At base, the issue has to do with the meaning of the article “a”: can “a” be plural? Here, the claim requires a light socked with “a neodymium magnet [having] a pull strength of at least five pounds” while the accused device uses several magnets.

On appeal, the Federal Circuit has vacated and remanded — holding that the district court went too far in restricting the patentee’s protected speech.

Objectively Baseless: The Federal Circuit has given patentees a fairly-wide berth with regard to public accusations of infringement and customer cease-and-desist letters. In particular, the court has held that state court tort claims associated with out-of-court patent enforcement activities are preempted by federal law unless the patent holder “acted in bad faith.” Breaking this down, the court requires that the infringement allegation be “objectively baseless” and that the patentee conducted its affairs with subjective bad faith. Although the court does not conduct a full First-Amendment analysis, the high burden is justified by our individual liberty interest (that includes corporate commercial speech).

In its decision, the Federal Circuit concluded that it is not-unreasonable for a patentee to assert that a claimed “magnet” could be infringed by two or more magnets.

Decisions of this court lend strong support to the proposition that, “in patent parlance,” at least in an open-ended “comprising” claim, use of “a” or “an” before a noun naming an object is understood to mean to “one or more” unless the context sufficiently indicates otherwise. . . .

The patent uses “the” or “said” when referring back to an antecedent “a” phrase, but that usage does not itself suffice to demand the singular meaning because if the “a” phrase means “one or more,” so would the subsequent reference-back phrases.

Slip Op.  The court notes that the patentee’s embodiments all just show a single magnet, but the court found nothing in the specification that limits the claim to that embodiment.

There is no “present invention” or other specification language that restricts the invention to a single (or single-piece) magnet, and there are no structural limitations in the claims that implicitly demand such a configuration. Importantly, and more generally, nothing in the ’779 patent indicates that the evident purpose of the magnet on the socket base (to attach the light string to a metal surface) can be achieved only, or with specified effectiveness, through a single (or single-piece) magnet, rather than a plurality of magnets collectively having the specified pull force.

Id.  Likewise, the Federal Circuit also concluded that the doctrine of equivalents could be pursued. The patentee had argued that “two semicircular magnets in the Magnetic Cord light-fixture bases are equivalent to the one [claimed] magnet.”  The Federal Circuit found “nothing unreasonable” about that allegation.  Further, Lite-Netics did not make any amendments or statements during prosecution concerning the number of magnets in a way that would create estoppel.

On remand, the patentee may seek a narrower preliminary injunction — focusing on the patent not discussed by the Federal Circuit.  Still, the Federal Circuit’s discussion gives a big boost to the patentee’s case.