Azure Networks, LLC v. Csr, Plc ( 2014 )

United States Court of Appeals
for the Federal Circuit
______________________
AZURE NETWORKS, LLC AND
TRI-COUNTY EXCELSIOR FOUNDATION,
Plaintiffs-Appellants,
v.
CSR PLC AND CAMBRIDGE SILICON RADIO
INTERNATIONAL, LLC,
Defendants-Appellees,
AND
ATHEROS COMMUNICATIONS, INC. AND
QUALCOMM INCORPORATED,
Defendants-Appellees,
AND
BROADCOM CORPORATION,
Defendant-Appellee,
AND
MARVELL SEMICONDUCTOR, INC.,
RALINK TECHNOLOGY CORPORATION (Taiwan)
AND RALINK TECHNOLOGY CORPORATION
(USA),
Defendants-Appellees.
______________________
2013-1459
______________________
2 AZURE NETWORKS, LLC v. CSR PLC
Appeal from the United States District Court for the
Eastern District of Texas in No. 11-CV-0139, Judge
Michael H. Schneider.
______________________
Decided: November 6, 2014
______________________
MICHAEL E. JOFFRE, Kellogg, Huber, Hansen, Todd,
Evans & Figel, P.L.L.C., of Washington, DC, argued for
plaintiffs-appellants. With him on the brief was ANNA D.
MAYERGOYZ. Of counsel on the brief were ERIC M.
ALBRITTON and MICHAEL BENEFIELD, Albritton Law Firm,
of Longview, Texas; and DANNY L. WILLIAMS and
CHRISTOPHER N. CRAVEY, Williams, Morgan & Amerson,
P.C., of Houston, Texas.
DOMINIC E. MASSA, Wilmer Cutler Pickering Hale and
Dorr LLP, of Boston, Massachusetts, argued for all de-
fendants-appellees. With him on the brief for defendant-
appellee Broadcom Corporation were LOUIS W. TOMPROS,
JASON H. LISS and DANA O. BURWELL. On the brief for
defendants-appellees Atheros Communications, Inc., et
al., were TIMOTHY TETER, LORI R. MASON and MATTHEW J.
BRIGHAM, Cooley LLP, of Palo Alto, California. On the
brief for defendants-appellees CSR PLC, et al., were
JEFFREY E. OSTROW and JONATHAN C. SANDERS, Simpson
Thacher & Bartlett LLP, of Palo Alto, California; and
KERRY L. KONRAD, of New York, New York.
______________________
Before REYNA, MAYER, AND CHEN, Circuit Judges.
Opinion for the court filed by Circuit Judge Chen.
Dissenting-in-part opinion filed by Circuit Judge Mayer.
AZURE NETWORKS, LLC v. CSR PLC 3
CHEN, Circuit Judge.
Plaintiffs Azure Networks, LLC (Azure) and Tri-
County Excelsior Foundation (Tri-County) sued CSR PLC,
Cambridge Silicon Radio International, LLC, Atheros
Communications, Inc., Qualcomm Inc., Broadcom Corp.,
Marvell Semiconductor, Inc., Ralink Technology Corp.
(Taiwan), and Ralink Technology Corp. (USA) (collective-
ly, Appellees) for alleged infringement of U.S. Patent No.
7,756,129 (the ’129 patent). The district court granted the
Appellees’ motion to dismiss Tri-County for lack of stand-
ing, finding that Tri-County had effectively assigned
Azure the ’129 patent. Because we agree that the agree-
ment between Tri-County and Azure constituted an
effective assignment for purposes of standing, we affirm
the dismissal of Tri-County.
The district court also construed the term “MAC ad-
dress” in the ’129 patent as “a device identifier generated
by the hub device” and not, as Azure and Tri-County
suggested, “an address that uniquely identifies a device or
group of devices on a shared communication medium.”
Azure stipulated to a judgment of noninfringement under
the district court’s construction of “MAC address.” Be-
cause the district court improperly construed the term, we
vacate the judgment of noninfringement and remand.
BACKGROUND
A. The ’129 Patent
The ’129 patent, entitled “Personal Area Network
with Automatic Attachment and Detachment,” describes a
network for wireless communications between a central
hub device and a number of surrounding peripheral
devices in close proximity with the hub device. The
specification details the use of “a wireless personal area
network [PAN] that permits a host device to communicate
with a varying number of peripheral devices with mini-
mal interference from neighboring networks.” ’129 pa-
4 AZURE NETWORKS, LLC v. CSR PLC
tent, 2:66–3:3. To do so, the hub device “orchestrates all
communication in the PAN,” including managing the
timing of the network, allocating available bandwidth
among the peripheral devices, and supporting the at-
tachment, detachment, and reattachment of peripheral
devices. Id. at 3:33–39. The hub and the peripheral
devices communicate with one another over a predefined
set of streams, or one-way communication links. Id. at
3:53–56.
Claim 14 is representative of the accused claims to a
hub device:
14. A hub device for use within a personal area
network, comprising:
circuitry, and
a transceiver in communication with the circuitry,
the hub device configured to cause the transceiver
to
i) send a message to indicate the availabil-
ity of the hub device for peripheral device
attachment,
ii) receive, from a first peripheral device, a
message indicating the availability of the
first peripheral device for communication
with the hub device,
iii) send, to the first peripheral device, a
signal including a first peripheral device
identifier,
iv) receive, from the first peripheral de-
vice, a response,
v) send a hub response to the first periph-
eral device, and
AZURE NETWORKS, LLC v. CSR PLC 5
vi) receive, from the first peripheral de-
vice, a second peripheral response includ-
ing the first peripheral device identifier.
Id. at claim 14 (emphasis added).
The parties agree that “peripheral device identifier” in
the asserted claims means “an element that identifies the
peripheral device.” Joint Appendix (J.A.) 1446. Claim 43
depends from claim 14 and introduces the disputed “MAC
address” term:
43. The hub device according to claim 14, wherein
the hub device is configured such that a plurality
of MAC addresses is capable of being used for
identification in association with the first periph-
eral device.
’129 patent, claim 43.
At the time of invention, the conventional meaning of
“MAC address,” i.e., a Media or Medium Access Control
address, was that it operated to uniquely identify a wire-
less device and could be generated in two ways—by the
manufacturer of the device or by the local network. The
district court concluded that the patentee acted as his
own lexicographer by redefining the claimed “MAC ad-
dress.” In so doing, the district court relied on the specifi-
cation in two ways. First, a statement in the specification
allegedly coined a new “MAC address” term that differs
from the traditional MAC address as known to a person of
ordinary skill in the art. That statement provided: “Each
device is identified by a Media Access (MAC) address.”
’129 patent, 3:31–32. And second, various statements in
the specification discussed the generation and assignment
of the MAC address by the hub device. See Azure Net-
works, LLC v. CSR PLC, No. 6:11CV139 LED-JDL, 2013
WL 173788, at *4 (E.D. Tex. Jan. 15, 2013). Based on
these passages, it construed “MAC address” as “a device
identifier generated by the hub device.” Id. at *5.
6 AZURE NETWORKS, LLC v. CSR PLC
B. Tri-County’s License to Azure
The ’129 patent has passed through many hands of
ownership, but it was eventually acquired by Azure, a
Texas limited liability company located in the Eastern
District of Texas. Azure then sought local charities to join
in its patent enforcement activities. Ultimately, it part-
nered with Court Appointed Special Advocates (CASA) of
Harrison County, 1 which formed Tri-County, a Texas non-
profit corporation with its principal place of business in
the Eastern District of Texas. In 2010, Azure donated
multiple patents and patent applications, including the
application that would issue as the ’129 patent, to Tri-
County. 2
A few weeks after the donation, Tri-County and Azure
entered into an “Exclusive Patent License Agreement”
(hereinafter, Agreement), which transferred back to Azure
a number of rights in the ’129 patent. In particular, the
Agreement granted Azure the exclusive, worldwide,
transferable right to (i) make, have made, use, sell, offer
to sell, import, and lease any products, (ii) use and per-
form any method, process, and/or services, and (iii) other-
wise practice any invention in any manner under the ’129
patent. It also granted Azure the “full right to enforce or
and/or sublicense” the ’129 patent, J.A. 1201 § 1.2, includ-
1 CASA of Harrison County is a member of the Na-
tional Court Appointed Special Advocate Association and
provides court-appointed advocacy for neglected and
abused children in Harrison County. J.A. 454.
2 The Appellees allege that Azure was motivated to
donate the patents and patent applications to Tri-County
in order in order to further establish venue in the Eastern
District of Texas and to deduct from Azure’s tax liability
the value of its donation and portions of litigation pro-
ceeds owed to Tri-County. Appellees’ Br. 8, 19; see also 26
U.S.C. § 170(m).
AZURE NETWORKS, LLC v. CSR PLC 7
ing the authority to reach settlements without Tri-
County’s consent. Specifically, the Agreement provided
that “Azure will have the exclusive right, but not the
obligation, to maintain, enforce, or defend” the ’129 pa-
tent, but has the “obligation to exercise good faith busi-
ness judgment to monetize” the ’129 patent, “including
but not limited to licensing [it] to third parties.” J.A. 1204
§ 4.4. Azure also received the right to assign the entire
Agreement or any of Azure’s rights under the Agreement,
without Tri-County’s consent, to any Azure affiliate in
connection with the sale of a material portion of any
Azure business unit. And, finally, the Agreement gave
Azure, not Tri-County, the exclusive right, but not the
obligation, to control future prosecution or pay mainte-
nance fees related to the ’129 patent family.
In exchange, Tri-County retained the right to receive
33% of the proceeds from Azure’s litigation or licensing
activities for the first five years and 5% thereafter. Azure
must pay Tri-County the respective percentages within
thirty days after each calendar quarter in which Azure
receives the proceeds. Tri-County also reserved “a royal-
ty-free, personal, non-transferable, non-exclusive right” to
practice the ’129 patent and make Tri-County branded
products. J.A. 1201–02 § 2.3. Additionally, Tri-County
retained a right to terminate the Agreement if Azure
breached its obligations or if Tri-County’s obligations
under the Agreement placed Tri-County’s tax-exempt
status at risk. Tri-County also reserved reversionary
rights in the ’129 patent once the Agreement expires. In
particular, the Agreement automatically expires on March
27, 2018, with two years remaining on the patent term,
but Tri-County has the option to renew in one-year in-
crements if it notifies Azure at least thirty days in ad-
vance. In addition, Tri-County is obligated not to
encumber the ’129 patent in any way and to participate in
litigation at Azure’s request and in Azure’s sole discretion.
8 AZURE NETWORKS, LLC v. CSR PLC
Tri-County and Azure filed suit together against the
Appellees, who thereafter sought to dismiss Tri-County
from the case. They argued that the significant rights
transferred to Azure under the Agreement constituted an
effective assignment for purposes of standing, leaving Tri-
County with no rights to sue as co-plaintiff. The district
court agreed, finding that Tri-County’s title in the patent
and financial and reversionary interests therein were not
sufficient to confer standing upon Tri-County. J.A. 34–35.
On the district court’s dismissal of Tri-County, Azure and
Tri-County appealed, and we have jurisdiction under 28
U.S.C. § 1295(a)(1).
DISCUSSION
I. Standing
Standing is a matter of law that we review de novo.
Evident Corp. v. Church & Dwight Co., Inc., 399 F.3d
1310, 1313 (Fed. Cir. 2005). The Patent Act governs
standing to sue for infringement, and it provides that only
the patentee and his successors in title are entitled to
bring a civil action for infringement. Propat Int’l Corp. v.
RPost, Inc., 473 F.3d 1187, 1189 (Fed. Cir. 2007) (citing 35
U.S.C. § 281); Speedplay, Inc. v. Bebop, Inc., 211 F.3d
1245, 1249–50 (Fed. Cir. 2000); Prima Tek II, L.L.C. v. A-
Roo Co., 222 F.3d 1372, 1376–77 (Fed. Cir. 2000). A party
is a patentee if it holds legal title to the patent, either by
issuance or assignment. Propat, 473 F.3d at 1189;
Speedplay, 211 F.3d at 1249–50.
Even if a patentee does not transfer legal title, it may
transfer significant rights to the patent. When the pa-
tentee transfers rights, the “party that has been granted
all substantial rights under the patent is considered the
owner regardless of how the parties characterize the
transaction that conveyed those rights.” Speedplay, 211
F.3d at 1250. “In that event, the transferee is treated as
the patentee and has standing to sue in its own name.”
Propat, 473 F.3d at 1189. And whichever party has all, or
AZURE NETWORKS, LLC v. CSR PLC 9
substantially all, rights in the patent “alone has standing
to sue for infringement.” Morrow v. Microsoft Corp., 499
F.3d 1332, 1340 (Fed. Cir. 2007); see also Alfred E. Mann
Found. for Scientific Research v. Cochlear Corp., 604 F.3d
1354, 1358–59 (Fed. Cir. 2010) (“A patent owner may
transfer all substantial rights in the patents-in-suit, in
which case the transfer is tantamount to an assignment of
those patents to the exclusive licensee, conferring stand-
ing to sue solely on the licensee.”). Therefore, when all
rights or all substantial rights have been transferred, the
transferee—and not the transferor—is the effective owner
for purposes of standing. See Speedplay, 211 F.3d at
1250.
In patent licensor-licensee standing cases, we are typ-
ically confronted with one of two scenarios: (1) cases in
which the exclusive licensee brings suit alone, requiring
us to decide whether the license agreement conferred
sufficient rights on the licensee for standing; or (2) cases
in which the licensor brings suit alone, and we decide
whether the licensor has transferred away enough rights
to divest it of the right to sue. This is not the typical case.
Here, both the licensor and the licensee have brought the
suit together, and the accused infringer seeks dismissal of
the licensor. Therefore, our inquiry in this case is two-
fold: (1) whether Tri-County transferred all substantial
rights under the ’129 patent to Azure, making Azure the
effective owner; and if so, (2) whether Tri-County may
nevertheless join in an infringement suit brought by the
licensee, but now effective owner, Azure.
A
“To determine whether an exclusive license is tanta-
mount to an assignment, we ‘must ascertain the intention
of the parties [to the license agreement] and examine the
substance of what was granted.’” Mann, 604 F.3d at 1359
(quoting Mentor H/S, Inc. v. Med. Device Alliance, Inc.,
240 F.3d 1016, 1017 (Fed. Cir. 2001)). The parties’ intent
10 AZURE NETWORKS, LLC v. CSR PLC
alone is not dispositive. See Vaupel Textilmaschinen KG
v. Meccanica Euro Italia S.P.A., 944 F.2d 870, 876 (Fed.
Cir. 1991) (finding agreement amounted to an assign-
ment, even though entitled “exclusive license,” because it
transferred substantial rights to licensee); see also
Speedplay, 211 F.3d at 1250.
We must also consider a non-exhaustive list of rights
for determining whether a licensor has transferred “all
substantial rights” to the licensee, including: (1) the
nature and scope of the right to bring suit; (2) the exclu-
sive right to make, use, and sell products or services
under the patent; (3) the scope of the licensee’s right to
sublicense; (4) the reversionary rights to the licensor
following termination or expiration of the license; (5) the
right of the licensor to receive a portion of the proceeds
from litigating or licensing the patent; (6) the duration of
the license rights; (7) the ability of the licensor to super-
vise and control the licensee’s activities; (8) the obligation
of the licensor to continue paying maintenance fees; and
(9) any limits on the licensee’s right to assign its interests
in the patent. Mann, 604 F.3d at 1360–61.
The parties do not dispute that the Agreement trans-
ferred to Azure an exclusive license to practice the ’129
patent. “[T]ransfer of the exclusive right to make, use,
and sell products or services under the patent is vitally
important to an assignment.” Id. at 1360. Also critical to
our inquiry is that the Agreement granted Azure the
exclusive right to enforce and defend the ’129 patent. In
determining the nature of a transfer of rights, we have
repeatedly recognized that a “key factor has often been
where the right to sue for infringement lies.” Aspex
Eyewear, Inc. v. Miracle Optics, Inc., 434 F.3d 1336, 1342
(Fed. Cir. 2006); see also Mann, 604 F.3d at 1361 (recog-
nizing that the “the most important consideration” in the
analysis is “the nature and scope of the exclusive licen-
see’s purported right to bring suit, together with the
AZURE NETWORKS, LLC v. CSR PLC 11
nature and scope of any right to sue purportedly retained
by the licensor”).
It is not uncommon for a licensor to transfer to its li-
censee the exclusive right to enforce the patent. But
significant to this case, Tri-County reserved no right to
have control over, to veto, or to be notified of any of Az-
ure’s licensing or litigation activities. Retaining control of
these activities is also critical to demonstrating that the
patent has not been effectively assigned to the licensee.
See, e.g., Propat, 473 F.3d at 1192 (noting that retention
of right to veto, be consulted about, or give consent to
litigation decisions weighs in favor of finding agreement a
license, not an assignment); Mann, 604 F.3d at 1362–63
(noting that right to have joint control over litigation or
right to bring suit against alleged infringer if licensee
refuses to bring suit would also indicate that licensor
retained substantial rights); Vaupel, 944 F.2d at 875
(patentee retained only right to be informed about litiga-
tion and no right to control litigation decisions, suggesting
an assignment of the patent); Speedplay, 211 F.3d at 1251
(holding that licensor retained no veto rights over licen-
see’s litigation activities and licensee’s complete control
over litigation suggested that licensee obtained substan-
tial rights).
Rather than retaining any control over litigation ac-
tivities, Tri-County has a strict duty under the Agreement
to “join Azure as a party and cooperate with Azure in any
patent infringement suit, if, desirable to address a legal
issue,” such as standing. J.A. 1204 § 4.4. Tri-County
must join “at Azure’s request,” and after joinder, “Azure
would maintain full and absolute control over any such
patent infringement suit, including settlement of any
related claims or causes of action.” Id. Tri-County’s
joinder “would be limited solely to cooperation and that
which is necessary to address the legal issue.” Id. As the
district court recognized, nothing about this relationship
structure indicates that Tri-County has control over any
12 AZURE NETWORKS, LLC v. CSR PLC
aspect of litigation involving the ’129 patent. Rather, it is
clear that Azure is holding all the strings. In sum, Az-
ure’s exclusive right to sue, exclusive license, and freedom
to sublicense are factors that strongly suggest that the
Agreement constitutes an effective assignment.
Tri-County argues that other factors demonstrate that
it retained enough rights such that whatever was trans-
ferred to Azure was something less than “all substantial
rights.” First, it points out that it has a right to receive a
portion of the proceeds from the enforcement of the ’129
patent. But that economic interest alone does not defeat a
transfer of substantial rights in the face of the factors
above that strongly indicate Azure’s ownership. See
Propat, 473 F.3d at 1191 (“To be sure, the fact that a
patent owner has retained a right to a portion of the
proceeds of the commercial exploitation of the pa-
tent . . . does not necessarily defeat what would otherwise
be a transfer of all substantial rights in the patent.”)
(citing Rude v. Westcott, 130 U.S. 152, 162–63 (1889)).
Second, it argues that it retained the right to practice
the ’129 patent, including the right to make, sell, and use
Tri-County-branded products covered by the patent. See
Fieldturf, Inc. v. Sw. Recreational Indus., Inc., 357 F.3d
1266, 1269 (Fed. Cir. 2004) (“[L]icensor’s retention of a
limited right to develop and market the patented inven-
tion indicates that the licensee failed to acquire all sub-
stantial rights.”). But in this case, this factor has little
force as Tri-County does not make or sell any products,
J.A. 8976–81, and the evidence on record suggests that
Tri-County will not make or sell any products in the
future. While Tri-County continues to retain this right
under the Agreement, its right is nonexclusive. We have
held that a nonexclusive license confers no standing on
the licensee because the licensee does not have a legally
protected interest conferred by the Patent Act. See
Propat, 473 F.3d at 1193–94 (holding that party has
standing to sue if it “has a legally protected interest in the
AZURE NETWORKS, LLC v. CSR PLC 13
patent created by the Patent Act,” and that bare licensee
has no standing). That same logic applies even if it is the
patent owner holding the nonexclusive right and the
licensee holds the exclusionary rights. It is the licensee,
Azure, who may freely sublicense other parties or, in-
stead, tolerate infringement. So while infringement may
cause Tri-County pecuniary loss, the Patent Act confers
Azure, not Tri-County, with standing to bring suit for the
infringement. See Ortho Pharm. Corp. v. Genetics Inst.,
Inc., 52 F.3d 1026, 1031 (Fed. Cir. 1995) (holding that
“[p]ractice of the invention by others may indeed cause
[the nonexclusive licensee] pecuniary loss,” but “economic
injury alone does not provide standing to sue under the
patent statute”) (internal citations omitted).
Third, Tri-County contends that it has termination
rights that limit whatever rights Azure has received
under the Agreement. In particular, each party has the
right to terminate the Agreement if the other party “sub-
stantially fails to perform or otherwise materially breach-
es any of the material terms, covenants or provisions of
[the] Agreement.” J.A. 1207 § 7.8. Tri-County maintains
that Azure must exercise good-faith judgment in monetiz-
ing the patents and report its efforts to Tri-County annu-
ally. Appellants’ Br. 27. Tri-County argues that it can
then exercise its right to terminate the Agreement, and
regain all rights conferred to Azure, if it determines that
Azure’s performance under this “good faith” provision is
unsatisfactory. Because Azure must enforce and license
the ’129 patent and share any proceeds with Tri-County,
Tri-County contends that its termination right enables it
to monitor—and, thus, control—Azure’s fulfillment of its
obligations. Reply Br. 6–7. According to Tri-County, this
termination right indicates that it retained significant
ownership interests in the ’129 patent. We do not agree.
We have held that termination rights conditioned up-
on the licensee’s “failure to perform up to the specified
benchmarks” provide some indication that the licensor
14 AZURE NETWORKS, LLC v. CSR PLC
retained ownership in the patent. See Propat, 473 F.3d at
1191–92. But the discussion of the termination right in
Propat must be read in context. We explained that the
Propat termination right, by itself, was not sufficient to
show ownership; rather, we were persuaded by the show-
ing of additional rights retained by the licensor, including
one of the most crucial ones—the right to control the
litigation and licensing decisions:
In addition, [the licensor] retains an economic in-
terest in the patent and a substantial measure of
control over decisions affecting the patent rights.
It enjoys an equity interest in the proceeds of li-
censing and litigation activities, a right to notice
of licensing and litigation decisions and the right
to veto such decisions as long as the veto power
was not exercised unreasonably, and the unre-
stricted power to bar [the licensee] from transfer-
ring its interest in the patent to a third party. In
no case has this court held that a patentee who re-
tains such broad and wide-ranging powers with
respect to a patent has nonetheless transferred
“all substantial rights” in the patent.
Id. at 1191. In Propat, the licensor retained the responsi-
bility to maintain the patent, the right to notice of the
licensee’s decision-making, the right to veto licensing and
litigation decisions, the right to veto any transfer of the
licensee’s rights, in addition to the right to terminate the
license if the licensee failed to meet certain benchmarks.
Id. at 1190–91. That is not the case here.
Tri-County’s right to monitor whether Azure breaches
any of its obligations does not amount to the type of
control that we have found indicative of ownership in
prior cases. Tri-County does not have the right to veto
any of Azure’s decisions, and Azure is not obligated to
obtain Tri-County’s consent before acting. In fact, Tri-
County does not even have the right to receive notice
AZURE NETWORKS, LLC v. CSR PLC 15
before Azure acts. Nor does Tri-County have the obliga-
tion to maintain the patent; maintenance lies with Azure,
at Azure’s option. It is true that Tri-County may termi-
nate the Agreement if Azure breaches its obligations, but
Tri-County does not explain—nor can we envision—how a
general good-faith requirement that inures to the finan-
cial benefit of both parties, with nothing more, would
allow Tri-County to trump Azure’s express and unilateral
rights and exert control over Azure’s licensing or litigation
decisions.
As an additional argument, Tri-County points to its
right to terminate the Agreement if it incurs unwanted
tax liabilities as a basis for demonstrating that it retained
ownership. But if Tri-County terminates the Agreement
for this reason, Azure has the option to re-acquire the ’129
patent for $305,000. J.A. 1207–08. Therefore, Tri-
County’s termination under this provision does not out-
right deprive Azure of controlling the patent. Tri-
County’s termination right under this provision loses
force as a factor suggesting it has substantial rights over
the ’129 patent.
Fourth, Tri-County contends that, in addition to its
termination rights, the Agreement automatically termi-
nates on March 27, 2018—two years before the patent
expires—leaving Tri-County a two-year reversionary
interest in the patent. Although Tri-County may option-
ally extend the Agreement in one-year increments, it
argues that, in general, agreements that terminate before
patent expiration leave the licensor with a substantial
interest in the patent.
In Aspex Eyewear, we addressed the effect of a hard
termination date, i.e., a date beyond which the license
cannot be renewed and all rights revert back to the licen-
16 AZURE NETWORKS, LLC v. CSR PLC
sor. 3 The termination clause in that case provided that
the license would expire in 2003, but it gave the licensee
one option to extend the term another three years. 434
F.3d at 1338 n.2. The license would finally terminate in
2006, still leaving eleven more years remaining on the
patent term, which was to expire in 2017. Id. at 1338 &
n.4.
The rights distributed between the licensee and licen-
sor in Aspex Eyewear were similar to the distribution of
rights between Tri-County and Azure. Like Azure, the
licensee in Aspex Eyewear held the exclusive right to
practice the invention, the right to bring suit for in-
fringement, and the unrestricted right to sublicense,
while the licensor, like Tri-County, retained no right to
make litigation or licensing decisions. We acknowledged
that this distribution strongly suggested the license was
an effective assignment for purposes of standing. Id. at
1342. Yet the hard termination date confirmed to us that
the licensor retained ownership of the patent because the
licensor would regain all the rights transferred to the
licensee with a majority of the patent term remaining:
It was not a situation in which [the licensee] had
an exclusive license with all substantial rights
that was only defeasible in the event of a default
3 Tri-County and the Appellees dispute whether the
discussion of a hard termination date in Prima Tek II
should guide the analysis. In that case, however, we
declined to express any opinion on the significance of hard
termination dates. See 222 F.3d at 1378 (“Significantly,
the agreement does not specify a ‘hard’ termination date
beyond which the license cannot be renewed, and we
express no opinion as to the effect of such a provision on a
licensee’s standing to sue.”) (emphasis added) (internal
citation omitted). Prima Tek II’s discussion of reversion-
ary rights therefore is inapplicable.
AZURE NETWORKS, LLC v. CSR PLC 17
or bankruptcy, or some other condition subse-
quent. By having rights for only a limited portion
of the patent term, it simply did not own the pa-
tent. It was merely an exclusive licensee without
all substantial rights. The ‘747 patent was never
assigned; it was exclusively licensed for only a
fixed period of years, which does not meet the all
substantial rights standard. Thus, we hold that
the Contour/Chic agreement was a license, not an
assignment, and [the licensor] was the owner of
the patent when the complaint was filed and enti-
tled to sue.
Id. at 1342–43 (footnote omitted). We distinguished
clauses, like the one in Prima Tek II, that lacked a defi-
nite termination date because “the term of the agreement
existed potentially for the life of the respective patents,
and it was presumable that the transferred patent would
never return to the assignor.” Id. at 1343.
The termination clause in Tri-County’s Agreement
does not have the same kind of hard termination date as
in Aspex Eyewear. Instead, the Agreement states that it
“shall end . . . on the termination date of 03/27/2018 or at
the end of each year thereafter, unless [Tri-County]
notifies Azure at least 30 days in advance of its intent to
renew the agreement for an additional year.” J.A. 1207
§ 7.8. We expressly noted in Aspex Eyewear that this type
of renewal cycle presumes that the patent “would never
return to the assignor.” 434 F.3d at 1343. We also note
that eleven years remained on the patent’s term in Aspex
Eyewear following the expiration date of the agreement
with no indication of the likelihood of extending or renew-
ing the license after the first option to extend. In con-
trast, only two years remain on the ’129 patent term
following the March 27, 2018 termination date. Such
short patent term life following expiration, coupled with
the rolling renewal cycle that can extend to the end of the
patent’s term, provides another indicator that Tri-County
18 AZURE NETWORKS, LLC v. CSR PLC
transferred all substantial rights to the patent. There-
fore, the district court was correct in concluding that the
reversionary right in the Agreement does not suggest, as
Tri-County contends, that Tri-County retained ownership
of the patent.
After weighing all the factors, we agree with the dis-
trict court that Azure acquired significant rights under
the ’129 patent, including the right to enforce, to license,
to control the licensing and litigation, to sublicense, to
practice exclusively, and to maintain the patent. Tri-
County’s economic interests, limited termination rights,
and unfixed reversionary interest with only a very limited
amount of time remaining on the patent do not demon-
strate that it retained ownership. As the district court
found, the balance of factors establishes that Tri-County
transferred all substantial rights in the ’129 patent to
Azure, making Azure the effective owner for purposes of
standing.
B
Azure and Tri-County argue that even if the Agree-
ment constitutes an assignment for purposes of standing,
Tri-County would still be able to join suit with Azure.
They maintain that Tri-County still has interests in the
’129 patent that are in jeopardy, including its reversion-
ary interest and its interest in receiving proceeds from
enforcing the patent. Appellants’ Br. 35–36. Having an
interest in the litigation, however, does not confer stand-
ing. To bring or join suit, Tri-County must have “exclu-
sionary rights and interests created by the patent
statutes.” Morrow, 499 F.3d at 1340 (emphasis added).
Parties who “hold less than all substantial rights to
the patent and lack exclusionary rights under the patent
statute” do not have standing. Id. at 1340–41 (emphasis
added). This lack of standing “cannot be cured by adding
the patent title owner to the suit.” Id. at 1341; Propat,
473 F.3d at 1193–94 (“By contrast, a bare licen-
AZURE NETWORKS, LLC v. CSR PLC 19
see . . . lacks standing to sue third parties for infringe-
ment . . . . A bare licensee cannot cure its lack of standing
by joining the patentee as a party.”).
As discussed above, Tri-County transferred all sub-
stantial rights in the ’129 patent to Azure, including all
exclusionary rights. Tri-County serves effectively as a
nonexclusive licensee. The district court properly con-
cluded that Tri-County lacks standing to bring suit, but
more importantly, to even join the suit. Because Tri-
County does not have any exclusionary rights under the
’129 patent, it lacks standing to join the suit as a co-
plaintiff. Tri-County’s standing deficiency cannot be
cured by adding Azure to the suit. See Morrow, 499 F.3d
at 1343 (“To demonstrate entitlement to join as a co-
plaintiff [a party] must have the right to exclude others
from making, using or selling the invention in the United
States.”). We therefore affirm the district court’s dismis-
sal of Tri-County.
II. “MAC Address”
Claim construction is a matter of law that we review
de novo. Lighting Ballast Control LLC v. Philips Elecs. N.
Am. Corp., 744 F.3d 1272 (Fed. Cir. 2014) (en banc).
There is a “heavy presumption” that claim terms “carry
their accustomed meaning in the relevant community at
the relevant time.” Home Diagnostics, Inc. v. LifeScan,
Inc., 381 F.3d 1352, 1355 (Fed. Cir. 2004). The district
court, however, construed “MAC address” narrowly as a
local address generated by the hub, even though the
ordinary and customary meaning included either local or
universal MAC addresses. Departure from the ordinary
and customary meaning is permissible only when the
patentee has acted as his own lexicographer or disavowed
claim scope in the specification or during the prosecution
history. Phillips v. AWH Corp., 415 F.3d 1303, 1316 (Fed.
Cir. 2005) (en banc). The heavy presumption that “MAC
20 AZURE NETWORKS, LLC v. CSR PLC
address” carries its well-established meaning in the
relevant industry has not been overcome here.
The parties do not meaningfully dispute the ordinary
and customary meaning of a “Media Access Control” or
“Medium Access Control” address (commonly referred to
as a MAC address) to the relevant community at the time
of invention. MAC addresses have long been used to
identify various wireless devices. Industry literature and
dictionaries at the time of invention, which are not dis-
puted, consistently define MAC addresses as unique
identifiers. For example, the dictionary of the Institute of
Electrical and Electronic Engineers (IEEE) defined “MAC
address” as “[a]n address that identifies a particular
medium access control (MAC) sublayer service access
point (SAP).” THE NEW IEEE STANDARD DICTIONARY OF
ELECTRICAL AND ELECTRONICS TERMS 755 (5th ed. 1993);
STEVEN M. KAPLAN, WILEY ELECTRICAL & ELECTRONICS
ENGINEERING DICTIONARY 459 (John Wiley & Sons 2004)
(defining MAC address as “Media Access Control ad-
dress,” that is, “a hardware address which uniquely
identifies each physical connection”). The Appellees’ own
construction acknowledges that MAC addresses are
“device identifiers.”
The claims use “MAC address” consistently with the
well-understood industry meaning: to identify a unique
device. Claim 2 recites that the “first peripheral device
identifier is based at least in part on a MAC address of
the first peripheral device.” Claim 43 recites that the
“plurality of MAC addresses [are] capable of being used
for identification in association with the first peripheral
device.” Nothing in the claims displaces the customary
meaning of “MAC address.” The specification also refers
to the term as an identifier for a device. ’129 patent,
3:60–64 (“The Hub 110 uses MAC addresses to identify
itself and the PEAs [Personal Electronic Accessory] 120.
The Hub 110 uses its own MAC address to broadcast to
all PEAs 120. The Hub 110 might also use MAC address-
AZURE NETWORKS, LLC v. CSR PLC 21
es to identify virtual PEAs within any one physical PEA
120.”).
At the time of invention, MAC addresses could be as-
signed either universally, i.e., the manufacturer of the
device creates the unique identifier for the device, or
locally, i.e., a network device, like the hub device of the
’129 patent, creates the unique identifier for a given
device, like the peripheral devices in the ’129 patent. J.A.
1605, IEEE Standard for Local and Metropolitan Area
Networks: Overview and Architecture 21 (IEEE Mar. 8,
2002) (within the 48-bit MAC address there is a “Univer-
sally or Locally administered (U/L) address bit . . . [which]
indicates whether the address has been assigned by a local
or universal administrator”) (emphasis added). 4 The
4 See, e.g., FRANK HARGRAVE, HARGRAVE’S
COMMC’NS DICTIONARY 313 (IEEE Press 2001) (defining
MAC as an “acronym for Medium Access Control” and
MAC address as a “48 bit number unique to each network
interface card (NIC). Generally, the number is pro-
grammed into the NIC at the time of manufacture; hence,
it is LAN and location independent. . . . Also called a
hardware address, MAC name, physical address, or
universal address.”) (emphasis added); NEWTON’S
TELECOM DICTIONARY 450 (CMP Books Feb. 2002) (equat-
ing MAC address with Medium Access Control Address
and defining as “a 48-bit number, formally known as an
EUI-48 (Extended Unique Identifier-48) . . . . The MAC
Address is programmed into the card, usually at the time
of manufacture”) (emphasis added). From these refer-
ences, the dissent gleans inconsistent definitions, which
do not exist. See Dissenting Op. 5–6. That MAC address-
es were usually programmed into a device at the time of
manufacture means that sometimes they were not. The
IEEE Standard for Local and Metropolitan Area Net-
works specification simply buttresses that point. The
22 AZURE NETWORKS, LLC v. CSR PLC
relevant dispute here is whether the claimed “MAC
address” should be read narrowly, as a device identifier
that can only be generated locally by the hub device,
thereby excluding the “universal” type MAC address
created by the manufacturer of the device. We see no
reason to limit this established term of art to only hub-
generated addresses. The claims of the ’129 patent do not
specify whether the “MAC address” is generated locally or
universally. The specification refers to the phrase “Media
Access (MAC) address,” and not “Media Access Control
(MAC) address.” Based on this single reference, the
district court concluded that the patentee “coin[ed] a new
term” distinct from a standard MAC address, which in
turn was limited to hub-generated addresses. Azure, 2013
WL 173788, at *4. We disagree. For a patentee to act as
his own lexicographer and give a term something other
than its well-established meaning, he must “clearly set
forth a definition of the disputed term.” CCS Fitness, Inc.
v. Brunswick Corp., 288 F.3d 1359, 1366 (Fed. Cir. 2002).
The lexicography must appear with “reasonable clarity,
deliberateness, and precision sufficient to narrow the
definition of the claim term in the manner urged.” Abbott
Labs. v. Syntron Bioresearch, Inc., 334 F.3d 1343, 1355
(Fed. Cir. 2003).
Through the single, cursory use of “Media Access
(MAC) address”—dropping the word “Control”—the
specification did not re-coin an established term of art by
redefining it to have a narrower definition than the tradi-
tional MAC address. Dropping the word “Control” was
prior art cited on the face of the ’129 patent uses MAC
addresses consistently with the IEEE specification, as
either universal or local addresses. See, e.g., PCT Appli-
cation WO 00/68811, 5:7–10 (published Nov. 16, 2000)
(describing a universal MAC address); U.S. Patent No.
6,570,857, 4:30–35 (describing a local MAC address).
AZURE NETWORKS, LLC v. CSR PLC 23
not unknown to those of ordinary skill in the art, based on
other technical literature. See, e.g., J.A. 1970–71, SUSAN
YOUNG & DAVE AITEL, THE HACKER’S HANDBOOK, THE
STRATEGY BEHIND BREAKING INTO AND DEFENDING
NETWORKS (CRC Press 2004) (referring to “Media Access
(MAC) address” as a “unique address assigned to a net-
working device upon its creation by the manufacturer”);
J.A. 1978, Implementing QoS, available at
http://vonage.nmhoy.net/qos.html (last visited Oct. 7,
2014) (“MAC Address prioritizes network devices by their
Media ACcess Address (MAC Address).”). This one indi-
cium therefore is simply not a strong enough suggestion
that the inventor intended to displace a well-established
term of art. See Ancora Techs., Inc. v. Apple, Inc., 744
F.3d 732, 738 (Fed. Cir. 2014) (holding that specification
does not set out redefinition for “volatile memory” term
and its clear ordinary meaning cannot be overcome “by a
few passing references that do not amount to a redefini-
tion or disclaimer”). This is especially so because “MAC
address” has a “clear, settled, and objective” meaning to a
person of ordinary skill in the art. See id. at 737 (finding
that term “volatile memory” has a “clear, settled, and
objective” meaning that leaves relevant public with firm
understanding of scope “unless something exceptional
sufficiently supplants that understanding”). And when
read in context, it becomes clear that that “Media Access
(MAC) address” in the specification has the same meaning
as that of a traditional MAC address: it is a device identi-
fier. ’129 patent, 3:31–32 (“Each device is identified by a
Media Access (MAC) address.”) (emphasis added).
In reading the hub-generation-only limitation into the
claims, the district court also pointed to the parts of the
specification referring to the hub device generating and
assigning the newly coined “MAC address” to the periph-
eral devices. Azure, 2013 WL 173788, at *4–5; see, e.g.,
’129 patent, 11:2–3 (“The Hub 110 then assigns a MAC
address to the PEA . . . .”). Failing to find a reference in
24 AZURE NETWORKS, LLC v. CSR PLC
the specification to manufacturer-generated MAC ad-
dresses, it concluded that the claimed “MAC address”
must be hub-generated.
Although there is no specific reference to universally
generated MAC addresses in the specification, using a
term the same way in all disclosed embodiments is not by
itself sufficient to redefine a term of art. See Aventis
Pharma S.A. v. Hospira, Inc., 675 F.3d 1324, 1330 (Fed.
Cir. 2012); CCS Fitness, 288 F.3d at 1366. The specifica-
tion “must have sufficient clarity to put one reasonably
skilled in the art on notice that the inventor intended to
redefine the claim term.” Merck & Co. v. Teva Pharms.
USA, Inc., 395 F.3d 1364, 1370 (Fed. Cir. 2005); see also
Innova/Pure Water, Inc. v. Safari Water Filtration Sys.,
381 F.3d 1111, 1117 (Fed. Cir. 2004) (“[E]ven where a
patent describes only a single embodiment, claims will not
be read restrictively unless the patentee has demonstrat-
ed a clear intention to limit the claim scope.”) (internal
quotation omitted).
The statements in the specification relied upon by the
district court neither define “MAC address” nor exclude
universal addresses. The specification does not state that
a hub-generated MAC address is the actual invention
itself or that hub-generation is a critical feature. See
SunRace Roots Enter. Co. v. SRAM Corp., 336 F.3d 1298,
1305 (Fed. Cir. 2003) (discussing cases limiting claim
language because feature “described as essential to the
invention” but declining to do so when the specification
“does not state that the cam is the actual invention it-
self”).
Moreover, nothing in the specification or the prosecu-
tion history shows an attempt to distinguish over prior art
for lacking a hub-generated MAC address. See SciMed
Life Sys., Inc. v. Advanced Cardiovascular Sys., Inc., 242
AZURE NETWORKS, LLC v. CSR PLC 25
F.3d 1337, 1343–44 (Fed. Cir. 2001); Alloc, Inc. v. Int’l
Trade Comm’n, 342 F.3d 1361, 1371 (Fed. Cir. 2003). 5
For these reasons, we adopt Azure’s proposed con-
struction of “MAC address” as “an address that uniquely
identifies a device or group of devices on a shared com-
munication medium.” Accordingly, we vacate the judg-
ment of noninfringement and remand for further
proceedings, consistent with this opinion.
AFFIRMED-IN-PART, VACATED-IN-PART, AND
REMANDED
COSTS
Each party shall bear their own costs.
5 The district court’s construction would also result
in the hub device generating its own MAC address, in
addition to generating the MAC addresses for the periph-
eral devices. Although the specification discusses embod-
iments where the hub generates the MAC address for
each peripheral device, it is entirely silent on the source of
the hub device’s own MAC address.
United States Court of Appeals
for the Federal Circuit
______________________
AZURE NETWORKS, LLC AND
TRI-COUNTY EXCELSIOR FOUNDATION,
Plaintiffs-Appellants,
v.
CSR PLC AND CAMBRIDGE SILICON RADIO
INTERNATIONAL, LLC,
Defendants-Appellees,
AND
ATHEROS COMMUNICATIONS, INC. AND
QUALCOMM INCORPORATED,
Defendants-Appellees,
AND
BROADCOM CORPORATION,
Defendant-Appellee,
AND
MARVELL SEMICONDUCTOR, INC.,
RALINK TECHNOLOGY CORPORATION (Taiwan)
AND RALINK TECHNOLOGY CORPORATION
(USA),
Defendants-Appellees.
_____________________
2013-1459
______________________
2 AZURE NETWORKS, LLC v. CSR PLC
MAYER, Circuit Judge, dissenting-in-part.
I agree with the court’s thorough and well-reasoned
analysis of the standing question, but respectfully dissent
from Section II of the court’s opinion. The specification of
U.S. Patent No. 7,756,129 (the “’129 patent”) repeatedly
and unambiguously indicates that the term “Media Access
(MAC) address” refers to an address that is assigned to a
peripheral device by a hub device. The patent neither
contemplates nor enables any other method of network
communication. The court offers no plausible justification
for disregarding the unequivocal disclosure in the specifi-
cation and dramatically expanding the definition of
“Media Access address” to cover any address that unique-
ly identifies a device on a shared communication system.
The decision to jettison the trial court’s claim construction
is predicated almost exclusively on a purported industry
definition of the term “Media Access Control address,” but
that term is found nowhere in the ’129 patent.
I.
Over and over again, the ’129 patent makes clear that
a “Media Access (MAC) address” is an address assigned to
a peripheral device by a hub device. The patent explains
that “a single [h]ub device” communicates with multiple
peripheral devices, id. col.3 l.28, and “orchestrates all
communication in the [Personal Area Network],” id. col.3
l.33. Each peripheral device is assigned a “Media Access
(MAC) address,” id. col.3 l.32, by the hub device when it
becomes part of the communications network, id. col.11
ll.50-52. The Summary of the Invention describes a single
method by which peripheral devices are attached to the
network, a method that requires that the hub device
assign a Media Access address to each peripheral device.
Id. col.1 ll.57-61 (explaining that “[t]he unattached pe-
ripheral device . . . receives a new address from the hub
device . . . and communicates with the hub device using
the new address”); id. col.2 ll.8-14 (explaining that the
AZURE NETWORKS, LLC v. CSR PLC 3
unattached peripheral device “receiv[es] a new address
from the hub device” and is “attach[ed] to the network
using the new address”). The specification goes on to
repeatedly describe a system in which the hub device
assigns an address to each peripheral device. Id. col.11
ll.2-4 (“[T]he [h]ub . . . assigns a MAC address to the
[peripheral device].”); id. col.11 ll.50-54 (“When the [h]ub
successfully receives the attach-request from the [periph-
eral device], it assigns a MAC address to the [peripheral
device].”); id. col.11 ll.55-60 (“The [h]ub sends the new
MAC address in an attach-assignment message to the
now-identified [peripheral device].” (diagram reference
numbers omitted)); id. col.12 ll.31-34 (“The [peripheral
device] waits for an attach confirmation from the [h]ub
using the new MAC address . . . and, upon receiving it,
sends a final acknowledgement to the [h]ub.” (diagram
reference numbers omitted)). Without exception, the ’129
patent uses the term “MAC address” to refer to an ad-
dress that is generated by the hub device. Nothing in the
specification contemplates that a Media Access address
will be assigned to a peripheral device at the time it is
manufactured. Instead, as the district court correctly
concluded, “what is defined and consistently disclosed” in
the ’129 patent “is a MAC address that originates with
the hub device.” Azure Networks, LLC v. CSR PLC, No.
11-CV-0139, slip op. at 2 (E.D. Tex. May 17, 2013).
The specification typically provides “the primary
guide to claim interpretation.” ArcelorMittal France v. AK
Steel Corp., 700 F.3d 1314, 1320 (Fed. Cir. 2012); see also
Retractable Techs., Inc. v. Becton, Dickinson & Co., 653
F.3d 1296, 1305 (Fed. Cir. 2011) (“It is axiomatic that the
claim construction process entails more than viewing the
claim language in isolation. Claim language must always
be read in view of the written description.”). Here, be-
cause the specification repeatedly makes clear that the
term “Media Access (MAC) address” refers to an address
assigned by a hub device—and discloses no other method
4 AZURE NETWORKS, LLC v. CSR PLC
for network communication—the court has no warrant to
vastly expand the term to cover any address that uniquely
identifies a device on a network. See Saffran v. Johnson
& Johnson, 712 F.3d 549, 560 (Fed. Cir. 2013) (explaining
that a claim term should be construed in accordance with
its “[e]xtensive, consistent usage in the specification”);
Kinetic Concepts, Inc. v. Blue Sky Med. Grp., Inc., 554
F.3d 1010, 1019 (Fed. Cir. 2009) (refusing to construe the
term “wound” to cover fistulae because such a construc-
tion would “expand the scope of the claims far beyond
anything described in the specification”). “Although the
specification need not present every embodiment or
permutation of the invention and the claims are not
limited to the preferred embodiment of the invention,
neither do the claims enlarge what is patented beyond
what the inventor has described as the invention.” Net-
word, LLC v. Centraal Corp., 242 F.3d 1347, 1352 (Fed.
Cir. 2001) (citation omitted).
II.
Three fundamental errors infect the court’s decision to
expand the ’129 patent to cover an invention that the
patentees neither claimed nor described. First, the court
states that “[t]he parties do not meaningfully dispute the
ordinary and customary meaning of a ‘Media Access
Control’ or ‘Medium Access Control’ address (commonly
referred to as a MAC address) to the relevant community
at the time of the invention.” Ante at 20. This is incor-
rect. The Defendants-Appellees vigorously—and persua-
sively—contend that Azure Networks, LLC (“Azure”)
never established that, at the time of the claimed inven-
tion, there was a standard industry definition of the term
“MAC address” which necessarily encompassed both
addresses assigned locally and at the time of manufac-
ture. To the contrary, Azure, in its opening claim con-
struction brief, “cited and quoted two references that
make clear that one of ordinary skill would understand
MAC addresses as pre-programmed identifiers, not locally
AZURE NETWORKS, LLC v. CSR PLC 5
assigned addresses.” Br. of Defendants-Appellees at 39-
40.
Azure’s problem is one of proof. If it wanted to en-
large its claims far beyond anything described in the
specification, it had the burden of coming forward with
evidence demonstrating not only that there was a com-
mon industry definition of the term “MAC address,” but
that that definition necessarily encompassed both ad-
dresses assigned at the time of manufacture and by a
local network. The simple fact, however, is that Azure
failed to adduce any such evidence. Indeed, its references
provide divergent definitions of the term. Azure relies
heavily on an Institute of Electrical and Electronics
Engineers (“IEEE”) specification which indicates that
MAC addresses can be assigned either locally or at the
time of manufacture. See J.A. 1604-07. Other references
Azure provided to the trial court, however, indicate that a
MAC address is typically a 48-bit number assigned to a
network interface card at the time of manufacture, not an
address assigned to a peripheral device by a local hub
device as described in the ’129 patent. See HARGRAVE’S
COMMC’NS DICTIONARY 313 (2001) (A “MAC address” is
“[a] 48-bit number unique to each network interface card
(NIC). Generally, the number is programmed into the
NIC at the time of manufacture; hence, it is LAN and
location independent.” (emphasis added)); NEWTON’S
TELECOM DICTIONARY 450 (2002) (A “MAC address” is a
“Medium Access Control Address” or a “MAC name” that
“traditionally is in the form of a 48-bit number, formerly
known as an EUI-48 (Extended Unique Indentifier-48),
which is unique to each LAN (Local Area Network) NIC
(Network Interface Card). The MAC address is pro-
grammed into the card, usually at the time of manufac-
ture.” (emphasis added)). The fact that Azure’s own
references provide inconsistent definitions of the term
“MAC address” belies its contention that there was a
“standard industry definition,” Br. of Plaintiffs-Appellants
6 AZURE NETWORKS, LLC v. CSR PLC
at 43, of the term sufficient to overcome its “[e]xtensive,
consistent usage,” Saffran, 712 F.3d at 560, in the specifi-
cation. See Renishaw PLC v. Marposs Societa’ Per Azioni,
158 F.3d 1243, 1250 (Fed. Cir. 1998) (emphasizing that “a
common meaning, such as one expressed in a relevant
dictionary, that flies in the face of the patent disclosure is
undeserving of fealty”).
Apparently recognizing that Azure’s claim construc-
tion argument rests on a very feeble evidentiary founda-
tion, the court creates out of whole cloth its own definition
of “Media Access address.” In the court’s view, a Media
Access address is anything that identifies a device on a
network, and it has ferreted out two dictionary definitions
that it believes support its definition of the term. See ante
at 20. These dictionary definitions are not part of the
record, however, and the Defendants-Appellees have had
no opportunity to challenge them. Even more fundamen-
tally, the one cited definition that could even arguably
support this court’s exceedingly broad claim construc-
tion—the one stating that a “Media Access Control ad-
dress” is “a hardware address which uniquely identifies
each physical connection,” ante at 20—pertains to a term
found nowhere in the ’129 patent.
Language matters. The definition upon which the
court’s claim construction is predicated is a definition of a
“Media Access Control address,” not a “Media Access
address,” the term used in the ’129 patent. See ’129
patent col.3 ll.31-32 (“Each device is identified by a Media
Access (MAC) address.”). The fact that the patentees
dropped the word “control” from their definition of the
acronym “MAC” is highly significant. It indicates that
they were not relying on any purported industry defini-
tion of the acronym, but were instead using the term
“Media Access (MAC) address” consistently with the
disclosure in the specification to refer to an address
assigned to a peripheral device by a hub device.
AZURE NETWORKS, LLC v. CSR PLC 7
Indeed, any doubt as to whether the meaning of the
term “MAC address” as used in the ’129 patent was
intended to be different from any purported industry
understanding of the term is resolved by reference to
documents the inventors themselves provided. The ’129
patent was developed in the course of the inventors’ work
on a project known as “BodyLAN.” On six separate occa-
sions, the BodyLAN specification uses the phrase “Media
ACcess,” capitalizing both the “A” and the first “C” in
“Access.” See J.A. 1664, 1686, 1691, 1701. The fact that
the inventors capitalized the “M,” the “A,” and the “C,” in
the term “Media ACcess” indicates that the letter “C” in
the acronym “MAC” refers to the second letter in the word
“access” and not to the word “control” in a media access
control address. See Computer Docking Station Corp. v.
Dell, Inc., 519 F.3d 1366, 1374 (Fed. Cir. 2008) (emphasiz-
ing that “repeated and definitive remarks in the written
description” can restrict a particular claim term); Ren-
ishaw, 158 F.3d at 1250 (“[W]here there are several
common meanings for a claim term, the patent disclosure
serves to point away from the improper meanings and
toward the proper meaning.”). Significantly, the
BodyLAN specification, just like the specification of the
’129 patent, makes clear that a “Media ACcess” address
originates with the hub device. See J.A. 1701.
Finally, even assuming arguendo that the term “MAC
address” is ambiguous and could potentially be construed
to cover addresses assigned to a device at the time of
manufacture, such a construction would render the as-
serted claims invalid. See Free Motion Fitness, Inc. v.
Cybex Int’l, Inc., 423 F.3d 1343, 1349 n.4 (Fed. Cir. 2005)
(explaining that a court can “construe claims to preserve
their validity when after applying all the available tools of
claim construction . . . the claim is still ambiguous” (cita-
tions and internal quotation marks omitted)). The ’129
patent describes a system in which a hub “orchestrates all
communication” in the network, ’129 patent col.3 l.33, by
8 AZURE NETWORKS, LLC v. CSR PLC
creating MAC addresses and assigning them to peripheral
devices, id. col.11 ll.2-4. The patent does not describe any
other way for the hub device to perform the attachment
and communication steps required by the asserted claims.
It contains no disclosure of how the claimed network
would function if the hub had to communicate with pe-
ripheral devices using unspecified and potentially propri-
etary addresses which had been assigned to those devices
at the time of manufacture. To expand the definition of
MAC address to include addresses assigned at the time of
manufacture would permit the ’129 patent to encompass a
network that the inventors neither contemplated nor
adequately described. See Nautilus, Inc. v. Biosig In-
struments, Inc., 134 S. Ct. 2120, 2124 (2014) (“[A] patent
is invalid for indefiniteness if its claims, read in light of
the specification delineating the patent, and the prosecu-
tion history, fail to inform, with reasonable certainty,
those skilled in the art about the scope of the invention.”);
MagSil Corp. v. Hitachi Global Storage Techs., Inc., 687
F.3d 1377, 1381 (Fed. Cir. 2012) (“The specification must
contain sufficient disclosure to enable an ordinarily
skilled artisan to make and use the entire scope of the
claimed invention at the time of filing.”).
Azure cannot have it both ways. If the term “MAC
address” is properly construed to refer only to addresses
assigned to peripheral devices by a hub device, then the
accused products do not infringe. If, on the other hand,
the term is broadly and unreasonably expanded to cover
addresses assigned at the time of manufacture, then the
asserted claims are invalid. See MagSil, 687 F.3d at 1381
(“[A] patentee chooses broad claim language at the peril of
losing any claim that cannot be enabled across its full
scope of coverage.”); Liebel–Flarsheim Co. v. Medrad, Inc.,
481 F.3d 1371, 1380 (Fed. Cir. 2007) (“The irony of this
situation is that [the patentee] successfully pressed to
have its claims include a jacketless system, but, having
AZURE NETWORKS, LLC v. CSR PLC 9
won that battle, it then had to show that such a claim was
fully enabled, a challenge it could not meet.”).