Ironburg Inventions Ltd. v. Valve Corporation

CourtCourt of Appeals for the Federal Circuit
DecidedApril 3, 2023
Docket21-2296
StatusPublished

This text of Ironburg Inventions Ltd. v. Valve Corporation (Ironburg Inventions Ltd. v. Valve Corporation) 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
Ironburg Inventions Ltd. v. Valve Corporation, (Fed. Cir. 2023).

Opinion

Case: 21-2296 Document: 66 Page: 1 Filed: 04/03/2023

United States Court of Appeals for the Federal Circuit ______________________

IRONBURG INVENTIONS LTD., Plaintiff-Cross-Appellant

v.

VALVE CORPORATION, Defendant-Appellant ______________________

2021-2296, 2021-2297, 2022-1070 ______________________

Appeals from the United States District Court for the Western District of Washington in No. 2:17-cv-01182-TSZ, Senior Judge Thomas S. Zilly. ______________________

Decided: April 3, 2023 ______________________

GREGORY S. TAMKIN, Dorsey & Whitney LLP, Denver, CO, argued for plaintiff-cross-appellant. Also represented by ANDREA AHN WECHTER; FORREST KWAHADA TAH- DOOAHNIPPAH, Minneapolis, MN; ROBERT DAVID BECKER, Manatt, Phelps & Phillips, LLP, San Francisco, CA; BEN- JAMIN G. SHATZ, Los Angeles, CA.

SHARON A. ISRAEL, Shook, Hardy & Bacon, LLP, Hou- ston, TX, argued for defendant-appellant. Also represented by KYLE E. FRIESEN; PATRICK A. LUJIN, MARK SCHAFER, BASIL TRENT WEBB, Kansas City, MO; REYNALDO BARCELO, Barcelo, Harrison & Walker, LLP, Newport Beach, CA. Case: 21-2296 Document: 66 Page: 2 Filed: 04/03/2023

______________________

Before LOURIE, CLEVENGER, and STARK, Circuit Judges. Opinion for the court filed by Circuit Judge STARK. Dissenting opinion filed by Circuit Judge CLEVENGER. STARK, Circuit Judge. In 2015, Ironburg Inventions Ltd. (“Ironburg”) sued Valve Corporation (“Valve”) for infringing U.S. Patent No. 8,641,525 (the “’525 patent”). In January 2021, after much pretrial litigation and a change of venue, a jury trial was held in the United States District Court for the Western District of Washington. Due to the global pandemic caused by the novel coronavirus, the trial proceeded virtually, with each juror attending trial remotely through videoconfer- encing technology. Before closing arguments, the parties and the district court agreed that each juror should have the accused product in hand, and that device – a hand held controller for playing video games – was mailed to each ju- ror. The multitude of issues presented in these cross-ap- peals does not, happily, include any challenge to the virtual nature or mechanics of the trial. Nevertheless, the reality of how the trial was conducted, and particularly the fact that the jurors were free to assess, through their own in- teractions with the accused device, whether a disputed claim limitation is met, is pertinent to at least one of the issues before us, so we mention the district court’s creative approach here at the outset. Prior to trial, the district court rejected invalidity chal- lenges based on the purported indefiniteness of several claim terms. It also held that Valve was estopped from pressing its prior-art-based invalidity defenses as a conse- quence of Valve’s partially instituted inter partes review Case: 21-2296 Document: 66 Page: 3 Filed: 04/03/2023

IRONBURG INVENTIONS LTD. v. VALVE CORPORATION 3

(“IPR”). Trial, therefore, proceeded only on infringement and damages issues. The jury returned a verdict of willful infringement and assessed damages of over $4 million. On post-trial mo- tions, the district court denied Valve’s motion for judgment as a matter of law – which sought a judgment of non-in- fringement and, failing that, a judgment that infringement was not willful – and also for a new trial. The new trial request was based on the admission of testimony from Duncan Ironmonger, Ironburg’s inventor and corporate representative, and on the exclusion of testimony from Karl Quackenbush, Valve’s general counsel. The district court also denied Ironburg’s motion to enhance damages. Both parties appealed. On appeal, we: (1) affirm the judgment that (a) “elon- gate member” is not indefinite, (b) “extends substantially the full distance between the top edge and the bottom edge” is not indefinite, (c) the claims are infringed, (d) the in- fringement was willful, (e) damages will not be enhanced, and (f) Valve is estopped from litigating the prior-art grounds on which IPR was requested but not instituted; and (2) vacate the district court’s conclusion that Valve is also estopped from litigating its later-discovered invalidity grounds and remand for further proceedings solely with re- spect to this issue. I A Ironburg owns the ’525 patent, entitled “Controller for Video Game Console,” which is directed to “a hand held controller for a video game console” that “includes one or more additional controls located on the back of the control- ler in a position to be operated by the user’s [middle, ring, or little] fingers.” ’525 patent 1:49-58. This back control is described in the specification as “inherently resilient” and is “elongate in shape and substantially extend[s] in a Case: 21-2296 Document: 66 Page: 4 Filed: 04/03/2023

direction from the top edge to bottom edge of the control- ler.” Id. 3:34, 3:51-53. Claim 1 is representative and is reproduced below, with the pertinent limitation highlighted: A hand held controller for a game console comprising: an outer case comprising a front, a back, a top edge, and a bottom edge, wherein the back of the controller is opposite the front of the controller and the top edge is opposite the bottom edge; and a front control located on the front of the controller; wherein the controller is shaped to be held in the hand of a user such that the user’s thumb is positioned to operate the front control; and a first back control and a second back control, each back control being located on the back of the controller and each back control including an elongate member that extends substantially the full distance between the top edge and the bottom edge and is inherently resilient and flexible. Id. cl. 1 (emphasis added). B Ironburg accused Valve’s Steam Controller, a video game controller for PC gaming, of infringing claims 2, 4, 7, 9, 10, and 11 of the ’525 patent. The back of the Steam Controller has two grip buttons. In development, the Steam Controller went through a series of prototypes (pic- tured below), including the Chell and Dog prototypes, which were publicly disclosed. Case: 21-2296 Document: 66 Page: 5 Filed: 04/03/2023

IRONBURG INVENTIONS LTD. v. VALVE CORPORATION 5

Back of the Chell prototype (Appx13889).

Back of the Dog prototype (Appx13904). After the ’525 patent issued, Ironburg sent a letter no- tifying Valve of the patent and Valve’s potential infringe- ment, pointing to the Chell prototype and also noting that “current or future products that incorporate similar fea- tures” might also infringe. Appx13517-19. Karl Quackenbush, Valve’s general counsel, responded to the letter by participating in several phone calls with Iron- burg’s representatives. Valve then began selling the final version of the Steam Controller, which is depicted below, in November 2015. Case: 21-2296 Document: 66 Page: 6 Filed: 04/03/2023

Back of the final Steam Controller (Appx13882). Ironburg sued Valve in the Northern District of Geor- gia on December 3, 2015. Valve then filed a petition with the United States Patent and Trademark Office (“PTO”), which partially instituted an IPR on September 27, 2016, as was permitted prior to the Supreme Court’s decision in SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018). The Patent Trial and Appeal Board (“PTAB” or “Board”) insti- tuted the IPR on three grounds, but declined to institute on two other grounds (the “Non-Instituted Grounds”). The Board then issued its Final Written Decision on September 22, 2017, cancelling claims 1, 6, 13, 14, 16, 17, 19, and 20 of the ’525 patent. Valve did not seek a remand pursuant to SAS, which would have allowed the Board to consider the Non-Instituted Grounds. In August 2017, while the IPR was pending, the case was transferred to the Western District of Washington, and that court adopted many of the Board’s claim construc- tions.

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