Infringement – expert evidence following Markman-style claim construction hearing – whether appropriate to appoint assessor or referee
Earlier this year Justice Middleton, in the Federal Court of Australia, broke new ground in this country by holding a hearing, and issuing a decision, purely on the issue of claim construction as a preliminary matter in patent infringement proceedings (see Federal Court Conducts Markman-Style Hearing in Hot Tub).
This week, Justice Middleton has issued two further decisions in the patent infringement case brought by Britax Childcare Pty Ltd (‘Britax’) against Infa-Secure Pty Ltd (‘Infa-secure’). In the first of these decisions, he has rejected efforts by Infa-Secure to have the court order that infringement issues be referred to an independent third party for assessment. Instead, the two experts will be returning to the so-called ‘hot tub’ to provide joint evidence to the court, based upon a claim construction with which neither one of them wholly agrees.
If all goes to schedule with this plan, the parties will be back in court for three days in December, for a further hearing to decide whether or not Infa-Secure infringes Britax’s patents.
CLAIM CONSTRUCTIONFor the uninitiated, ‘claim construction’ is patent-law-speak for the process of working out exactly how the claims of a patent – the clauses defining in words exactly what is, and therefore is not, an infringement – should be interpreted. Until all of the terminology in the claims has been tied down to a specific meaning, the court cannot decide whether an allegedly infringing product of conduct is actually infringing, or whether the patent claims are, in fact, valid.
Even so, the established practice in Australia (where we do not have juries in patent trials, and all issues are decided by the judge) is generally to conduct a single hearing airing all of the issues in the case, after which the judge issues a decision on all of the questions before the court. This remains the case even if the hearing lasts for many weeks, or even months – as in the ongoing litigation between Apple and Samsung presently being heard by Justice Annabelle Bennett.
In the US, by contrast, it is very common for questions of claim construction to be decided as a preliminary matter, before the case goes to a full hearing before a jury. US claim construction hearings are called ‘Markman hearings’, after the Supreme Court ruling, in Markman v Westview Instruments, Inc.  USSC 35, that the proper interpretation of patent claims is a matter of law which is for a judge to decide.
In the case of Britax v Infa-Secure – in which Britax is suing Infa-Secure for alleged infringement of nine innovation patents and one standard patent relating to child safety seats – Justice Middleton threw the two parties’ experts into the ‘hot tub’, asking them to produce a joint report setting out their points of agreement and disagreement on issues relating to the interpretation of the patent claims. He then conducted a hearing, and issued a 104-page decision setting out his findings on claim construction.
The court’s construction of the claims did not completely accept the construction offered by either expert witness, leaving each side in the position of having to continue the case on the basis of a different interpretation of the claims than the one for which it had been pressing. Justice Middleton had clearly hoped that resolving the matter of claim construction would lead to the parties’ coming to an agreement between themselves.
However, it seems that this was not to be. The matter has been back in court, with Justice Middleton now issuing a further decision including orders on the further conduct of the case, which will see the experts head back into the ‘hot tub’ to bump heads over whether or not Infa-Secure’s products infringe Britax’s patents, based on the court’s construction of the patent claims.
REFERAL TO THIRD PARTY ADJUDICATORNormally, in patent cases, the court needs to inform itself about various factual, technical and background matters in order to reach a decision. For example, the judge may need someone to help him or her understand the technology covered by the patents, or to explain the meaning of various terms of art. These ‘assistants’ do not decide the case – that is a matter solely for the judge – although sometimes the answer to a factual question (such as the meaning of a particular term appearing in a patent claim) may lead directly to a decision (such as whether or not the claim is valid and/or infringed).
Most commonly, the court is assisted by expert witnesses brought forward by the parties to the proceedings. Unsurprisingly, the experts on each side usually disagree on the facts most pertinent to the outcome, and the court has to decide which opinion is more persuasive and credible (or reach a compromise position).
There are, however, alternatives to this process. Section 217 of the Patents Act 1990 allows the court to call on the services of an assessor ‘to assist it in the hearing and trial or determination of any proceedings’ under the Act. Section 54A of the Federal Court of Australia Act 1976 similarly permits the court to appoint a referee to conduct an inquiry, and report on any questions arising in court proceedings.
In this case, Infa-Secure asked Justice Middleton to consider these options, and to appoint either an assessor (under the Patents Act) or a referee (under the Federal Court Act). Presumably, Infa-Secure is not happy with the direction the matter is taking between its expert (Mr Hunton) and Britax’s expert (Mr Newman), and is hoping that it might receive a more favourable review from a new and independent third party.
Britax – obviously much happier with the expert process – opposed Infa-Secure’s request.
Justice Middleton denied Infa-Secure’s request, explaining (at ):
Realistically, it seems to me that … the persons who could best assist the Court in the circumstances are Messrs Hunter and Newman, who have knowledge of the background of the trial, the matters which were initially agreed upon between the expert witnesses, and the reasons why the issues of disagreement arose between them. To appoint an independent third party now would involve that person expending considerable extra time even just to become familiar with the patents, the products in suit and the Construction Judgment. This is without any other documentation the parties want to put before him or her. Further, an assessor could not undertake the judicial function of deciding on competing submissions of the parties or the competing evidence if the expert witnesses were unable to reach agreement on everything. So on the basis the Court does require further assistance at this stage to bring the infringement proceedings to an efficient and effective conclusion, the assistance is best provided directly to the Court by Messrs Hunter and Newman.
THE EXPERTS’ NEXT TASKJustice Middleton has instead ordered the experts to get back together, and produce a further joint report ‘directed to the presence or absence in the respondent’s products of the integers of the relevant claims of the patents in suit’, i.e. on the questions relevant to the court’s decision on infringement.
The interesting thing about this new joint report is that both of the experts will be required to form new views based on the claim construction determined by the court. This construction differs from both experts’ own original opinions, thus rendering moot their earlier views on the infringement questions.
As Justice Middleton put it:
It does not seem to me to be to the point that, prior to the delivery of the Construction Judgment, one or other of the expert witnesses offered an opinion as to the existence of a particular integer in one or more Infa products. The Court has now made its decision on construction, and as noted above, it declined to wholly adopt the views of one expert over the other. I have no doubt that each of the expert witnesses can, with the Construction Judgment in hand, apply their mind to the task now to be undertaken, namely, to apply that decision to the Infa products. (At .)
Now that they are in receipt of the Construction Judgment, the expert witnesses are in a far better position to assist the Court in coming to the correct determination as to whether or not there has been infringement. I see nothing unfair in this approach, provided that the parties are given an opportunity to present their arguments in the next part of the hearing. (At .)
CONCLUSIONOne remarkable thing about the conduct of this case is the extent to which both Britax and Infa-Secure appear to have lost ‘control’ of their respective expert witnesses.
Generally – and unsurprisingly – each party to proceedings will identify an expert whose views are reasonably favourable to its case. This does not mean that any of the experts are in any way dishonest. Patent cases often turn on very fine technical points, upon which reasonable and competent expert opinions may differ. Finding a ‘good’ expert is a matter of selection, not seduction!
The case of Britax v Infa-Secure started conventionally enough, with each side bringing forward expert witnesses whose opinions on questions of construction and infringement supported their positions.
But Justice Middleton has successfully hijacked the process by conducting an initial Markman-style hearing on claim construction, and issuing a judgment setting out a construction differing from that of both parties’ experts. Unless they reach a settlement out-of-court, both Britax and Infa-Secure are committed to having their experts confer on the infringement issues based upon a claim construction which has been ordered by the court. They need to set aside their own views on these issues, and simply compare the allegedly infringing products with the claim features as defined in the earlier Construction Judgment.
The proper role of experts is to assist the court, not to advocate in favour of the party that has engaged them (no matter how much they may be paid). Whether this is always how things work out is a question that is sometimes raised. However, Justice Middleton appears to have engineered a situation in which it is far more likely that the experts will be working for the court, and not for their instructors.
One thing is certain – trial lawyers hate losing control of any aspect of their cases, especially one as potentially volatile as an independent expert witness! The possibility that Justice Middleton’s approach may become a model for future patent trials in Australia must be causing some concern among a few members of the legal profession.