Smartmetric Inc. v. American Express Co.

NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
__________________________
SMARTMETRIC INC.,
Plaintiff-Appellant,
v.
AMERICAN EXPRESS COMPANY,
Defendant-Appellee.
__________________________
2011-1473
__________________________
Appeal from the United States District Court for the
Central District of California in case no. 10-CV-9371,
Judge Jacqueline H. Nguyen.
__________________________
SMARTMETRIC INC.,
Plaintiff-Appellant,
v.
MASTERCARD INTERNATIONAL
INCORPORATED,
Defendant-Appellee,
AND
VISA INC.,
Defendant-Appellee.
SMARTMETRIC v. AMERICAN EXPRESS 2
__________________________
2011-1497
__________________________
Appeal from the United States District Court for the
Central District of California in case no. 10-CV-1864,
Judge Jacqueline H. Nguyen.
___________________________
Decided: April 11, 2012
___________________________
PATRICK F. BRIGHT, Wagner, Anderson & Bright, P.C.,
of Glendale, California, argued for plaintiff-appellant.
PETER J. ARMENIO, Quinn Emanuel Urquhart & Sulli-
van, LLP, of New York, New York, argued for defendant-
appellee American Express Company and GREGORY A.
CASTANIAS, Jones Day, of Washington, DC, argued for
defendants-appellees Visa Inc. and MasterCard Interna-
tional Incorporated. With him on the brief for Visa Inc.
were JOSEPH MELNIK of Palo Alto, California; BRIAN J.
MURRAY and DENNIS MURASHKO, of Chicago, Illinois.
GARY A. CLARK, Sheppard, Mullin, Richter & Hampton
LLP, of Los Angeles, California, for MasterCard Interna-
tional Incorporated. With him on the brief were DARREN
M. FRANKLIN and DENNIS J. SMITH.
__________________________
Before LOURIE, MOORE, and WALLACH, Circuit Judges.
MOORE, Circuit Judge.
After the district court construed the disputed terms
of asserted U.S. Patent No. 6,792,464 (’464 patent), the
parties stipulated to the entry of a judgment of non-
3 SMARTMETRIC v. AMERICAN EXPRESS
infringement in favor of American Express, Mastercard,
and Visa (collectively American Express). Smartmetric
appeals the district court’s constructions of two claim
terms. For the reasons set forth below, we affirm the
district court’s judgment.
BACKGROUND
The ’464 patent is directed to a system and method
that allow a user to access one of a plurality of network
service providers through the use of a smart card contain-
ing network access information. ’464 patent col.1 ll.13-17.
The specification explains that smart cards may be either
“contact smart cards,” having electrical contacts through
which information is exchanged with a card reader, or
“contactless smart cards,” having embedded antennas to
wirelessly communicate with a card reader. ’464 patent
col.1 ll.39-58.
Two claim terms are at issue on appeal, “insertion of
said data card into said data card reader” and “plurality
of network service providers.” Both of the disputed terms
appear in independent claims 1 and 14. Claim 1, which is
representative, reads:
A computer system for allowing a user to auto-
matically access one of a plurality of network ser-
vice providers . . . comprising:
a data card which contains the information spe-
cific to the user and/or the network service pro-
vider to be accessed;
a data card reader adapted to access at least part
of the information contained on the data card
when the data card is in communication
therewith;
SMARTMETRIC v. AMERICAN EXPRESS 4
a data processor in communication with the data
card reader and adapted to be connected to a net-
work; and
an application program . . . configured to auto-
matically retrieve at least part of the information
contained on the data card when the data card is
in communication with said data card reader and
to use said information to gain access to one of the
plurality of network service providers . . . ,
wherein said application program is immediately
triggered upon insertion of said data card into
said data card reader.
’464 patent col.10 ll.18-47 (emphasis added).
The district court construed “insertion of said data
card into said data card reader” to mean “the data card is
physically inserted into a recess of the data card reader.”
J.A. 52. The district court construed “plurality of network
service providers” to mean “a plurality of entities that
provide a gateway to a general-purpose network such as
the internet.” J.A. 54. Smartmetric contends both of
these constructions are erroneous. We have jurisdiction
under 28 U.S.C. § 1295(a)(1).
DISCUSSION
Claim construction is a matter of law that we review
de novo. ICU Med., Inc. v. Alaris Med. Sys., Inc., 558 F.3d
1368, 1374 (Fed. Cir. 2009). Absent contrary evidence,
“the words of a claim ‘are generally given their ordinary
and customary meaning’” as understood by a person of
ordinary skill in the art at the time of invention. Phillips
v. AWH Corp., 415 F.3d 1303, 1312 (Fed. Cir. 2005) (en
banc) (quoting Vitronics Corp. v. Conceptronic, Inc., 90
F.3d 1576, 1582 (Fed. Cir. 1996)). The claims are read in
context with the specification, but limitations from the
5 SMARTMETRIC v. AMERICAN EXPRESS
specification should not be read into the claims. Id. at
1315, 1323.
A. “insertion of said data card into said data card reader”
Smartmetric contends that the district court’s con-
struction is erroneous because it requires physical inser-
tion of a data card into the recess of a card reader, which
excludes contactless data card embodiments that can be
inserted into the “electromagnetic field” of a data card
reader. Smartmetric also argues that because dependent
claims 6 and 19 recite communicating information be-
tween a data card and a data card reader using embedded
antennas, the construction of “insertion . . . into” should
encompass both “contact” and “contactless” data cards.
We disagree. The district court’s construction cor-
rectly reflects the plain and ordinary meaning of inserting
a data card into a data card reader. The specification
does not give us any reason to depart from this plain and
ordinary meaning. See Thorner v. Sony Computer Entm’t
Am. LLC, 669 F.3d 1362, 1365 (Fed. Cir. 2012) (“There
are only two exceptions to this general rule: 1) when a
patentee sets out a definition and acts as his own lexicog-
rapher, or 2) when the patentee disavows the full scope of
a claim term either in the specification or during prosecu-
tion.”). Instead, the specification fully supports the dis-
trict court’s construction. It states: “[p]referably, the
data card is inserted into a recess provided within the data
card reader.” ’464 patent col.3 ll.36-37 (emphasis added).
Smartmetric contends that the specification’s discus-
sion of a card being “passed near” a card reader refers to
“inserting the . . . card into the electromagnetic field of the
. . . card reader.” Appellant Br. 12 (citing ’464 patent col.9
ll.28-34). The plain and ordinary meaning of “insertion . .
. into said data card reader,” however, does not include
insertion into an “electromagnetic field,” and the specifi-
SMARTMETRIC v. AMERICAN EXPRESS 6
cation does not discuss “inserting into” an “electromag-
netic field.” Instead, the specification expressly contrasts
data cards that are “inserted into” the recess of a card
reader with data cards that are “passed near” a card
reader. Compare ’464 patent col.3 ll.36-37 with id. col.9
ll.28-34. The claims recite only the former. Construing
“insertion . . . into” to also mean “passed near” would
deviate from the term’s plain and ordinary meaning,
conflict with the specification, and erroneously rewrite the
claims. See K-2 Corp. v. Salomon S.A., 191 F.3d 1356,
1364 (Fed. Cir. 1999) (“Courts do not rewrite claims;
instead, we give effect to the terms chosen by the pat-
entee.”).
Smartmetric’s claim differentiation argument is also
unavailing. Although claims 1 and 14 use slightly differ-
ent language, they both require that a data card be in-
serted into a card reader to “immediately trigger” the
execution of an application program. Both claims also
separately require that the data card be “in communica-
tion with” the card reader to transfer information between
the two. The embedded antenna limitations in dependent
claims 6 and 19 further limit the method of “communica-
tion” between the card and card reader, but do not modify
the separate “insertion/triggering” limitations. Smart-
metric erroneously conflates these two separate and
distinct claim limitations even though they have different
meanings. Thus, this case does not present a claim
differentiation concern. Moreover, we see no reason why
a data card that communicates with a card reader using
an embedded antenna cannot also be inserted into a data
card reader to immediately trigger an application pro-
gram. We therefore hold that the district court’s con-
struction of “insertion of said data card into said data card
reader” is correct.
7 SMARTMETRIC v. AMERICAN EXPRESS
B. “plurality of network service providers”
Smartmetric contends that the district court’s con-
struction erroneously limits “network service providers” to
those providing access to general purpose “public” net-
works. Smartmetric argues that the construction of
“network service providers” should include those provid-
ing access to “private” networks, such as an intranet.
American Express argues that the repeated use of “inter-
net service provider” and “internet access provider” in the
specification indicates that “network service providers”
are gateways to public general-purpose networks.
The plain and ordinary meaning of “network service
provider” is a provider of network services. The specifica-
tion does not use the term “public” or “private” network,
and although it does refer to internet service providers
and internet access providers, it also refers more gener-
ally to “network service providers.” For example, the
specification states that “[t]he present invention relates to
a computer system that allows a user to automatically
connect to a network service provider.” ’464 patent col.1
ll.13-15. The specification further explains that
“[t]ypically, the network service provider is an Internet
Service Provider (ISP) or an Internet Access Provider
(IAP) . . . . Alternatively, the network service provider
might be a proxy server of an intranet.” ’464 patent col.4
ll.29-33 (emphasis added). Thus, the specification ex-
plains that although ISPs and IAPs are “typically” net-
work service providers, intranet proxy servers may also be
“network service providers.” We therefore hold that the
district court’s construction erroneously limits network
service providers to those providing access to general-
purpose public networks.
****
SMARTMETRIC v. AMERICAN EXPRESS 8
The district court’s judgment of non-infringement was
independently supported by its construction of either
term. For the reasons explained above, the district court’s
construction of “plurality of network service providers”
was erroneous; however, its construction of “insertion of
said data card into said data card reader” was correct.
Accordingly, the district court’s judgment of non-
infringement is affirmed. We need not reach American
Express’s additional arguments on appeal.
AFFIRMED