Tviim, LLC v. McAfee, Inc. , 851 F.3d 1356 ( 2017 )

United States Court of Appeals
for the Federal Circuit
______________________
TVIIM, LLC,
Plaintiff-Appellant
v.
MCAFEE, INC.,
Defendant-Appellee
______________________
2016-1562
______________________
Appeal from the United States District Court for the
Northern District of California in No. 3:13-cv-04545-HSG,
Judge Haywood S. Gilliam Jr.
______________________
Decided: March 21, 2017
______________________
JOHN J. SHAEFFER, Fox Rothschild, LLP, Los Angeles,
CA, argued for plaintiff-appellant. Also represented by
JEFFREY H. GRANT; WILLIAM A. RUDY, Denver, CO.
JOSEPH J. MUELLER, Wilmer Cutler Pickering Hale
and Dorr LLP, Boston, MA, argued for defendant-
appellee. Also represented by RICHARD WELLS O’NEILL,
SARAH B. PETTY; NINA S. TALLON, MICHAEL WOLIN, Wash-
ington, DC.
______________________
2 TVIIM, LLC v. MCAFEE, INC.
Before PROST, Chief Judge, CLEVENGER and REYNA,
Circuit Judges.
REYNA, Circuit Judge.
TVIIM, LLC (“TVIIM”) sued McAfee, Inc. (“McAfee”)
in the United States District Court for the Northern
District of California for infringement of U.S. Patent No.
6,889,168 (“’168 patent”). A jury determined that McAfee
did not infringe the ’168 patent and that the ’168 patent
was invalid. After the jury verdict, TVIIM filed motions
for judgment as a matter of law (“JMOL”) and for a new
trial. The district court denied both motions, and TVIIM
filed this appeal challenging the jury verdict and the
district court’s denial of its post-verdict motions. We
affirm because substantial evidence supports the jury’s
findings of non-infringement and invalidity under a
uniform construction of the relevant claim terms, and the
district court did not abuse its discretion in denying a new
trial.
BACKGROUND
1. The ’168 Patent
The ’168 patent is entitled “Method and Apparatus for
Assessing the Security of a Computer.” It describes “a
security system which identifies security vulnerabilities
and discrepancies for a computing system.” ’168 patent,
col. 1, ll. 65–67. The ’168 patent both identifies potential
security threats to a computer and, under certain condi-
tions, recommends action to a user to stop the threat.
Four claims of the ’168 patent are relevant to this ap-
peal. Independent claim 1 recites:
A security system for a computer apparatus,
wherein said computer apparatus includes a
processor and system memory, said security
system comprising:
TVIIM, LLC v. MCAFEE, INC. 3
at least one security module which under direc-
tion from the processor accesses and analyzes
selected portions of the computer apparatus to
identify vulnerabilities;
at least one utility module which under the direc-
tion from the processor, performs various utility
functions with regards to the computer appa-
ratus in response to the identified vulnerabili-
ties; and
a security system memory which contains security
information for performing the analysis of the
computer apparatus.
’168 patent, col. 10, l. 65 to col. 11, l. 10 (disputed terms
emphasized).
Dependent claim 7 recites:
The security system of claim 1 wherein the securi-
ty modules include at least one of . . . an integ-
rity checking module which analyzes files in the
system memory to identify system vulnerabili-
ties;
a network checking module which analyzes the
computer apparatus to identify vulnerabilities
created as a result of the computer apparatus
connecting with a data network; and
a password checking module which analyzes
passwords for users of the computer apparatus
to identify vulnerabilities.
Id. col. 11, ll. 25–46 (disputed term emphasized).
Dependent claim 9 recites: “The security system of
claim 7 wherein the system memory comprises a list of
known vulnerabilities which may be employed by the
integrity checking module.” Id. col. 11, ll. 62–64.
4 TVIIM, LLC v. MCAFEE, INC.
Finally, independent claim 11 recites:
A method of providing a security assessment for a
computer system which includes a system
memory, comprising the steps of:
providing a security subsystem in the computer
system such that functionality of the security
subsystem is directed through a processor for
the computer system, wherein the security per-
forms steps comprising:
identifying a configuration of the system;
accessing the system memory and performing at
least one procedure to provide a security as-
sessment for at least one aspect of the computer
system;
as a result of any vulnerabilities discovered in the
assessment, identifying corrective measures to
be taken with regards to the computer system;
reporting the discovered vulnerability and the
identified corrective measures; and
upon receiving an appropriate command, initiat-
ing the corrective measures.
Id. col. 12, ll. 1–18 (disputed terms emphasized).
2. McAfee
McAfee developed “Program Updates” for Microsoft
Windows users to protect software programs against new
security threats. Program Updates detects and installs
updates for numerous non-Windows programs such as
Apple iTunes and Adobe Acrobat. To do so, it scans a
user’s computer to determine whether any of the non-
Windows programs are installed. If it detects such a
program, Program Updates makes two determinations:
(1) whether the National Vulnerability Database (“NVD”)
lists any vulnerabilities in the currently installed version
TVIIM, LLC v. MCAFEE, INC. 5
of that program; and (2) whether an update is available.
If an update is available, Program Updates will install the
update.
Prior to installing an update, Program Updates does
not provide users with a detailed report of security
threats; rather, it tells the user whether an update is
“Critical” or merely “Recommended.” J.A. 2044–46, 3338.
If an update is available, Program Updates will install the
available update whether or not the NVD lists any known
vulnerabilities. By contrast, if no software update is
available, Program Updates will not take action even if it
detects a vulnerability. Without an available update,
Program Updates will not provide users with any infor-
mation about a detected vulnerability. J.A. 2047–48. To
summarize, the presence of a known vulnerability is
irrelevant to whether Program Updates installs an up-
date.
3. Prior Art
At trial, McAfee argued that two prior art references
anticipated the ’168 patent and, in the alternative, that
their combination would have rendered the ’168 patent
obvious.
The first reference, HostGUARD, is a software pro-
gram developed by several named inventors of the ’168
patent. HostGUARD first detects computer security
threats and then reports them to the user. J.A. 1090,
3796–97. These detailed reports include file names and
locations, the particular nature of the vulnerability, and
steps the user can take to combat the threat. Host-
GUARD requires the user to decide whether to take
corrective action. Thus, the user (not HostGUARD itself)
takes any desired corrective action. J.A. 3796.
The second reference, System Security Scanner (“S3”),
is a “security assessment tool” that “evaluates system
vulnerabilities from the inside.” J.A. 3799. S3 allows a
6 TVIIM, LLC v. MCAFEE, INC.
user to select which specific vulnerabilities to assess and
then provides a “detailed description” of detected vulnera-
bilities to the user. J.A. 3816, 3801, 3836. For example, it
offers a “long description” report that identifies “bugs”
that create exploitable weaknesses in the system. J.A.
2610–11; see also J.A. 2293 (testimony that S3 provides
users with reports on “specific vulnerabilities found on
specific computers”). S3 does not fix vulnerabilities itself;
rather, it requires a user to open a new window and take
corrective action.
4. District Court Proceedings
TVIIM sued McAfee in 2013, alleging that Program
Updates infringed the ’168 patent. McAfee counter-
claimed for declarations of non-infringement, invalidity,
and inequitable conduct.
McAfee moved for summary judgment that Host-
GUARD anticipated the asserted claims of the ’168 pa-
tent. In its motion, McAfee argued that all claim terms
should be given their plain and ordinary meaning. In its
opposition, TVIIM asked the district court to construe
only one term: “vulnerability.” The district court denied
McAfee’s motion on anticipation because material issues
of fact remained for trial. The district court also ruled
that “vulnerability” should “have its plain and ordinary
meaning and is not limited in scope to ‘pre-existing’
security problems or vulnerabilities.” J.A. 567. The court
then asked for supplemental briefing on the plain and
ordinary meaning of “vulnerability.” The parties agreed
that a “vulnerability” is an “exploitable weakness in a
computer system.” J.A. 633. The court adopted that
construction and asked if it needed to construe any other
terms. Both parties said no further construction was
necessary.
The case went to trial, and the jury returned a verdict
that: (1) McAfee did not infringe the ’168 patent; (2) the
’168 patent was invalid; and (3) TVIIM did not obtain the
TVIIM, LLC v. MCAFEE, INC. 7
’168 patent through inequitable conduct. The jury’s
general verdict of invalidity did not distinguish between
obviousness and anticipation. The inequitable conduct
issue is not subject to this appeal.
TVIIM filed motions for JMOL and a new trial, argu-
ing that the jury had rendered an inconsistent verdict.
According to TVIIM, the jury could not have arrived at
both a non-infringement and invalidity determination
using a single construction of three claim terms: “as a
result of/in response to”; “various utility functions”; and
“reporting the discovered vulnerabilities.” TVIIM con-
cedes that it did not seek construction of any of these
terms before or during trial. Opening Br. at 70.
The district court denied TVIIM’s motions. It found
that the jury’s verdict was not inconsistent because sub-
stantial evidence supported both a non-infringement and
invalidity verdict under a single construction of all three
claim terms. J.A. 6–8.
TVIIM timely appeals. We have jurisdiction under 28
U.S.C. § 1295(a)(1).
STANDARD OF REVIEW
We review denials of motions for JMOL and motions
for new trial under the law of the regional circuit—here,
the Ninth Circuit. InTouch Techs., Inc. v. VGO
Commc’ns, Inc., 751 F.3d 1327, 1338 (Fed. Cir. 2014). The
Ninth Circuit reviews denials of JMOL de novo. Harper
v. City of Los Angeles, 533 F.3d 1010, 1021 (9th Cir. 2008).
In the Ninth Circuit, the district court grants JMOL when
“the evidence, construed in the light most favorable to the
nonmoving party, permits only one reasonable conclusion,
and that conclusion is contrary to the jury’s verdict.” Id.
(quotation marks and citation omitted). A district court
must uphold a jury’s verdict “if it is supported by substan-
tial evidence, which is evidence adequate to support the
jury’s conclusion, even if it is also possible to draw a
8 TVIIM, LLC v. MCAFEE, INC.
contrary conclusion.” Id. (quotation marks and citation
omitted). Substantial evidence is “such relevant evidence
as a reasonable mind might accept as adequate to support
a conclusion.” Theme Promotions, Inc. v. News Am. Mktg.
FSI, 546 F.3d 991, 1000 (9th Cir. 2008) (quotation marks
and citation omitted). Whether a claim is anticipated is a
question of fact, MPHJ Tech. Invs., LLC v. Ricoh Ams.
Corp., 847 F.3d 1363, 1378 (Fed. Cir. 2017), as is the
question of infringement, Applied Med. Res. Corp. v. U.S.
Surgical Corp., 448 F.3d 1324, 1332 (Fed. Cir. 2006).
The Ninth Circuit reviews the denial of a motion for
new trial for abuse of discretion. Incalza v. Fendi N. Am.,
Inc., 479 F.3d 1005, 1013 (9th Cir. 2007). It reverses the
denial only if the record lacks any evidence supporting the
verdict or if the district court makes a mistake of law.
Molski v. M.J. Cable, Inc., 481 F.3d 724, 729 (9th Cir.
2007).
DISCUSSION
1. Non-Infringement And Invalidity
Claim terms must be construed the same way for the
purpose of determining invalidity and infringement.
Amgen Inc. v. Hoechst Marion Roussel, Inc., 314 F.3d
1313, 1330 (Fed. Cir. 2003). A district court’s determina-
tion that a claim term has a “‘plain and ordinary meaning’
may be inadequate when [the claim] term has more than
one ‘ordinary meaning.’” O2 Micro Int’l Ltd. v. Beyond
Innovation Tech. Co., 521 F.3d 1351, 1361 (Fed. Cir.
2008).
We first address TVIIM’s argument that the jury ren-
dered an inconsistent verdict of infringement and invalid-
ity because the claim terms “as a result of/in response to,”
“various utility functions,” and “reporting the discovered
vulnerabilities” have more than one ordinary meaning.
We note that TVIIM did not seek construction of any of
the three terms at trial. It never presented multiple
TVIIM, LLC v. MCAFEE, INC. 9
ordinary meanings of the three terms or showed that they
are open to varying interpretations. We are not persuad-
ed that any of the three terms has multiple ordinary
meanings, and we discern no error in the district court
submitting them to the jury without specific instruction.
TVIIM argues that it is not seeking a new claim construc-
tion of any terms on appeal. To be sure, it has waived any
new construction. “[A] party may not introduce new claim
construction arguments on appeal or alter the scope of the
claim construction positions it took below. Moreover,
litigants waive their right to present new claim construc-
tion disputes if they are raised for the first time after
trial.” Conoco, Inc. v. Energy & Envtl. Int’l, L.C., 460 F.3d
1349, 1358–59 (Fed. Cir. 2006) (citations omitted). Thus,
TVIIM “cannot be allowed to create a new claim construc-
tion dispute following the close of the jury trial.” Broad-
com Corp. v. Qualcomm Inc., 543 F.3d 683, 694 (Fed. Cir.
2008).
We next address whether substantial evidence sup-
ports the jury’s verdict of non-infringement based on
using the same construction it used for its invalidity
verdict. See Harper, 533 F.3d at 1021. We conclude that
the jury verdict is supported by substantial evidence.
A. “As A Result Of/In Response To”
There was no dispute at trial that the term “as a re-
sult of/in response to” requires a causal relationship
between corrective action and the discovered vulnerabil-
ity. McAfee’s expert Dr. Rubin testified that Program
Updates installs software updates regardless of whether a
vulnerability exists and that the only requirement for
update installation is the availability of an update. J.A.
2444 (“The only determining factor whether Program
Updates will update software is if there’s an update
available.”). In other words, the presence of a vulnerabil-
ity is irrelevant to whether Program Updates installs a
software update. As a result, with Program Updates
10 TVIIM, LLC v. MCAFEE, INC.
there is no causal relationship between corrective action
and the discovered vulnerability. We find Dr. Rubin’s
testimony on this point to be substantial evidence sup-
porting the jury’s non-infringement verdict.
We also find that substantial evidence supports the
jury verdict of invalidity based on anticipation. Dr. Rubin
testified that the prior art anticipated the ’168 patent by
initiating corrective action in response to a detected
vulnerability. See, e.g., J.A. 2476 (explaining how Host-
GUARD discloses the “as a result of any vulnerabilities”
limitation of claim 11); J.A. 2494 (concluding that S3
anticipates claim 1). TVIIM insists that the jury failed to
distinguish “all” vulnerabilities from “potential” vulnera-
bilities. But TVIIM failed to clarify its position during
claim construction. Moreover, the jury was free to credit
Dr. Rubin’s testimony that HostGUARD and S3 antici-
pate claims 1 and 11, even in the face of opposing argu-
ments from TVIIM. We thus find Dr. Rubin’s testimony
to be substantial evidence supporting the jury’s invalidity
determination.
B. “Various Utility Functions”
TVIIM and McAfee presented competing expert tes-
timony on infringement. TVIIM’s expert Dr. Garuba
testified that Program Updates satisfies the “various
utility functions” term by performing four functions:
identifying the threat, accessing the update, downloading
the update, and installing the update. J.A. 2123–24.
McAfee’s expert Dr. Rubin disagreed and testified that
Program Updates performs only one function—
downloading software updates via multiple steps. J.A.
2445 (“[T]he only thing that [Program Updates] does is it
updates the programs.”); see also J.A. 2454–55. Given the
conflicting expert testimony, we find that a reasonable
mind might accept Dr. Rubin’s testimony over
Dr. Garuba’s. Thus, substantial evidence supports the
jury’s verdict of non-infringement. See Versata Software,
TVIIM, LLC v. MCAFEE, INC. 11
Inc. v. SAP Am., Inc., 717 F.3d 1255, 1263 (Fed. Cir. 2013)
(affirming jury award as supported by substantial evi-
dence despite competing expert testimony).
Dr. Rubin’s testimony also supports the jury’s invalid-
ity verdict for anticipation. He explained how S3 per-
forms “different utility functions.” J.A. 2493. TVIIM
expert Eric Knight also testified that HostGUARD “cor-
rected, at a minimum, ownership and permission,” i.e.,
different functions. J.A. 2620. Thus, the testimony that
the prior art and ’168 patent both perform multiple func-
tions constitutes substantial evidence in support of the
jury’s verdict of invalidity.
Given the testimony at trial, we find that a uniform
construction of “various utility functions” would allow the
jury to arrive at verdicts of non-infringement and invalid-
ity, as both are supported by substantial evidence.
C. “Reporting The Discovered Vulnerabilities”
At trial, TVIIM argued that Program Updates in-
fringes “reporting the discovered vulnerabilities” by
providing a “risk rating” to users prior to installation, i.e.,
whether a particular update is “critical” or simply “rec-
ommended.” When pressed about what vulnerability
information is provided to users by Program Updates,
TVIIM’s expert Dr. Yu responded, “[n]othing more than
just a risk rating.” J.A. 2046. In other words, although
Program Updates reports the risk level to the user, it does
not report any specific information on vulnerabilities.
Dr. Rubin testified that such a risk rating does not consti-
tute “reporting the discovered vulnerabilities,” because
Program Updates does not report “something like a
[Common Vulnerabilities and Exposures] number or a
specific description of the vulnerability.” J.A. 2455.
Program Updates will not report any detected vulnerabil-
ity to a user if no update is available. We find this testi-
mony to be substantial evidence supporting the jury’s
non-infringement verdict.
12 TVIIM, LLC v. MCAFEE, INC.
Regarding invalidity for anticipation, the record
demonstrates that unlike Program Updates, HostGUARD
and S3 provide users with specific reports on detected
vulnerabilities. See, e.g., J.A. 2478 (Dr. Rubin) (“So here
we see the actual vulnerability is described” [in S3]); J.A.
3796 (HostGUARD brochure describing “reports [that] are
written in plain English and are formatted to effectively
communicate the results of the security assessment”); J.A.
3841–78 (examples of “Vulnerability Descriptions” in S3). 1
Program Updates, by contrast, does not provide any
detailed vulnerability descriptions. J.A. 2002, 2046, 2455.
Given this evidence presented, we find that the jury
verdict of invalidity is supported by substantial evidence.
As with the other two terms, TVIIM has not persuad-
ed us that a jury could not arrive at a non-infringement
and invalidity verdict based on a single construction of
“reporting the discovered vulnerabilities.” Because sub-
stantial evidence supports the jury’s verdicts, the district
court did not abuse its discretion by denying TVIIM’s
motion for a new trial.
2. Any Potential Error In Claim Construction
Was Harmless
On appeal, TVIIM concedes that substantial evidence
supports the jury’s finding for either non-infringement or
invalidity but argues it does not support both. Opening
Br. at 73 (“[A]ny single ordinary meaning construction
could support either infringement or invalidity.”) (empha-
sis omitted); see also J.A. 2638 (TVIIM’s counsel stating at
1 TVIIM asserts that the jury and district court im-
properly construed “vulnerabilities” to include “discrepan-
cies.” But the district court specifically found that “the
intrinsic evidence does not clearly exclude ‘discrepancies’
from the scope of the claim term ‘vulnerability.’” J.A. 634.
TVIIM did not appeal that construction.
TVIIM, LLC v. MCAFEE, INC. 13
trial, “I think there’s questions of fact with respect to
infringement.”).
Thus, by TVIIM’s own admission, the jury’s invalidity
determination could be proper under “any single ordinary
meaning construction.” Opening Br. 73. This concession
is determinative, because even if we were to find an
inconsistent verdict, substantial evidence under “any”
construction supports the jury’s verdict of invalidity.
Consequently, any potential error by the jury regarding
non-infringement was harmless. Cf. Senju Pharm. Co.
v. Lupin Ltd., 780 F.3d 1337, 1353 (Fed. Cir. 2015) (af-
firming the district court’s invalidity finding and therefore
not reaching non-infringement arguments); MobileMedia
Ideas LLC v. Apple Inc., 780 F.3d 1159, 1173 (Fed. Cir.
2015) (holding that because the patent was invalid, the
court “need not reach Apple’s argument that its accused
iPhones do not infringe”).
CONCLUSION
The jury’s findings of non-infringement and invalidity
under a single construction of all three disputed claim
terms are supported by substantial evidence. Even if
error occurred in the jury’s verdict of infringement, we
agree with McAfee that substantial evidence supports the
jury’s invalidity finding. This renders any error harm-
less. In light of these findings, we hold that the district
court’s denial of TVIIM’s motion for JMOL is supported by
substantial evidence, and that the district court did not
abuse its discretion in denying TVIIM’s motion for a new
trial. We therefore affirm.
AFFIRMED
COSTS
No costs.