Antennasys, Inc. v. Aqyr Technologies, Inc.

976 F.3d 1374
CourtCourt of Appeals for the Federal Circuit
DecidedOctober 7, 2020
Docket19-2244
StatusPublished
Cited by11 cases

This text of 976 F.3d 1374 (Antennasys, Inc. v. Aqyr Technologies, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Federal Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Antennasys, Inc. v. Aqyr Technologies, Inc., 976 F.3d 1374 (Fed. Cir. 2020).

Opinion

Case: 19-2244 Document: 44 Page: 1 Filed: 10/07/2020

United States Court of Appeals for the Federal Circuit ______________________

ANTENNASYS, INC., Plaintiff-Appellant

v.

AQYR TECHNOLOGIES, INC., WINDMILL INTERNATIONAL, INC., Defendants-Appellees ______________________

2019-2244 ______________________

Appeal from the United States District Court for the District of New Hampshire in No. 1:17-cv-00105-PB, Judge Paul J. Barbadoro. ______________________

Decided: October 7, 2020 ______________________

STEVEN JAY GROSSMAN, Grossman Tucker Perreault & Pfleger, PLLC, Manchester, NH, for plaintiff-appellant.

LAURA CARROLL, Burns & Levinson LLP, Boston, MA, for defendants-appellees. Also represented by ERIC G.J. KAVIAR. ______________________

Before O’MALLEY, BRYSON, and REYNA, Circuit Judges. O’MALLEY, Circuit Judge. Case: 19-2244 Document: 44 Page: 2 Filed: 10/07/2020

There is little more frustrating for a district court judge than to have the parties jointly lead you down a wrong, and possibly unnecessary, path. That is what occurred here. Unfortunately, many threshold issues that may have obviated the need for either claim construction or an in- fringement verdict remain unresolved. At first blush, this is a patent infringement case, with the only dispute before us concerning the district court’s construction of one claim term in United States Patent No. 7,432,868 (“the ’868 pa- tent”). But it is equally likely that Plaintiff’s sole federal question count (patent infringement) is predicated on an impermissible theory of liability and that the district court had no jurisdiction over the remaining state law claims. Recognizing that we do not have the benefit of a complete factual record on some of the underlying questions, we va- cate and remand. BACKGROUND This case comes to us from the United States District Court for the District of New Hampshire’s grant of sum- mary judgment for Windmill International, Inc. and AQYR Technologies, Inc. (collectively, “Defendants”) on Plaintiff AntennaSys, Inc.’s patent infringement and related state law claims. The ’868 patent, directed to portable antenna positioners, has two named inventors. The inventors each assigned their interest in the patent to their respective em- ployers—AntennaSys and Windmill. The parties entered into a license agreement pursuant to which Windmill ac- quired an exclusive license to AntennaSys’s one-half inter- est in the patent in two separate markets—the United States Federal Marketplace (sales to the United States Government) and the commercial marketplace (sales out- side the Federal Marketplace). J.A. 108–09. In exchange for the exclusive right and license in the commercial marketplace to AntennaSys’s interest in the patent, Windmill agreed to pay AntennaSys three percent of the gross sales price for each unit of products covered by Case: 19-2244 Document: 44 Page: 3 Filed: 10/07/2020

ANTENNASYS, INC. v. AQYR TECHNOLOGIES, INC. 3

the patent. Under Section 4.A.4 of the agreement, if Wind- mill fails to meet certain minimum sales requirements in the commercial marketplace, its exclusive license to Anten- naSys’s interest becomes non-exclusive. J.A. 109. If that occurs, either party has the right to exploit the patent in the commercial marketplace, just as they would in the ab- sence of any agreement. As to enforcement of the patent, the agreement provides that, if Windmill loses its exclusiv- ity, either party has the right to commence a lawsuit against “third party” infringers. J.A. 111. The parties do not dispute that Windmill did, in fact, fail to meet the sales requirements of the agreement, such that its license to An- tennaSys’s one-half interest in the patent should now be non-exclusive. As part of this transaction, the parties also agreed that “Windmill shall create” an LLC and “shall own the entire membership interest in the LLC.” J.A. 108. This LLC was to own both Windmill’s own interest in the patent and Windmill’s license to AntennaSys’s interest in the patent. There appears to be no dispute that Windmill did create such an LLC, called GBS Positioner LLC. In March 2017, AntennaSys sued AQYR Technologies, Inc., Windmill’s wholly-owned subsidiary, for infringement of the ’868 patent. It separately filed an arbitration claim against Windmill based on an alleged failure to pay royal- ties for sales of the accused products pursuant to the li- cense agreement. The parties agreed to dismiss the arbitration without prejudice and to proceed in district court in the same suit that AntennaSys had filed against AQYR. Accordingly, the amended complaint contains five state law counts (against Windmill, AQYR, or both defend- ants), and one count of patent infringement (against AQYR). Following claim construction, AntennaSys con- ceded that it could not prevail on its patent infringement claim under the court’s construction of one of the claim terms. Apparently motivated by a desire to moot AQYR’s affirmative defenses of invalidity and unenforceability of Case: 19-2244 Document: 44 Page: 4 Filed: 10/07/2020

the patent in suit, AntennaSys sought summary judgment of non-infringement. J.A. 1170–71. AntennaSys asserted that the court’s construction of the disputed claim term precludes it “from advancing [both] a patent infringement liability case against defendants as well as . . . state law claims.” J.A. 1172. After conducting a hearing—during which AntennaSys agreed that it could not succeed on any of its state law claims absent a finding of patent infringe- ment—the district court entered judgment for Windmill and AQYR. J.A. 1 n.1; J.A. 1369–99. AntennaSys timely appealed. 1 DISCUSSION In reviewing the grant of a motion for summary judg- ment we apply the law of the regional circuit in which the district court sits, here, the First Circuit. AbbVie Deutsch- land GmbH & Co., KG v. Janssen Biotech, Inc., 759 F.3d 1285, 1295 (Fed. Cir. 2014). The First Circuit reviews a grant of summary judgment de novo. Santiago-Diaz v. Ri- vera-Rivera, 793 F.3d 195, 199 (1st Cir. 2015). On appeal, AntennaSys challenges the district court’s claim construction. Defendants argue, however, that we

1 Defendants filed a notice of cross-appeal, but An- tennaSys moved to dismiss that cross-appeal as improperly directed to AQYR’s affirmative defense of patent invalidity. We granted AntennaSys’s motion, explaining that it was improper for AQYR to pursue its cross-appeal because the judgment was entirely in AQYR’s favor and the district court “did not enter a final judgment against AQYR on in- validity, but only issued a claim construction order briefly touching upon the issue of indefiniteness[.]” Order, Anten- naSys, Inc. v. AQYR Techs., Inc., No. 19-2244, at *3 (Fed. Cir. Dec. 5, 2019). Notably AQYR did not seek a declara- tory judgment of invalidity, asserting invalidity only as an affirmative defense to the claim of infringement. Case: 19-2244 Document: 44 Page: 5 Filed: 10/07/2020

ANTENNASYS, INC. v. AQYR TECHNOLOGIES, INC. 5

need not address the merits of this appeal because Anten- naSys “lacks standing” to bring a patent infringement claim absent joinder of Windmill as a co-plaintiff. As dis- cussed below, although Defendants’ arguments are based on an incorrect view of current law, we agree that, in this case, whether a patent co-owner must be joined is a thresh- old issue that must be resolved first. We conclude, moreo- ver, that no judgment on infringement should be entered without first resolving AQYR’s affirmative defense that it was authorized by a co-owner to practice the ’868 patent.

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976 F.3d 1374, Counsel Stack Legal Research, https://law.counselstack.com/opinion/antennasys-inc-v-aqyr-technologies-inc-cafc-2020.