O2 International Ltd. v. Beyond Innovation Technology Co., Ltd.

449 F. App'x 923
CourtCourt of Appeals for the Federal Circuit
DecidedNovember 18, 2011
Docket2011-1054
StatusUnpublished
Cited by6 cases

This text of 449 F. App'x 923 (O2 International Ltd. v. Beyond Innovation Technology Co., Ltd.) 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
O2 International Ltd. v. Beyond Innovation Technology Co., Ltd., 449 F. App'x 923 (Fed. Cir. 2011).

Opinions

Opinion for the court filed by Circuit Judge LOURIE. Dissenting opinion filed by Circuit Judge PROST.

LOURIE, Circuit Judge.

Beyond Innovation Technology Co., Ltd. (“BiTEK”) appeals from the district court’s final judgment in favor of 02 Micro International Ltd. (“02 Micro”). Final Judgment and Permanent Injunction, 02 Micro Int'l Ltd. v. Beyond Innovation [925]*925Tech. Co., No. 2:04-CV-0032 (E.D.Tex. Sept. 27, 2010), ECF No. 669 (“Final Judgment”). The judgment follows a bench trial in which the district court found that BiTEK induced infringement of various claims of 02 Micro’s U.S. Patents 6,259,615 (“the '615 patent”) and 6,396,722 (“the '722 patent”) and imposed a permanent injunction. Id. at 1-2.

In this appeal, BiTEK challenges the district court’s finding of induced infringement and the grant and scope of the permanent injunction. BiTEK also appeals the district court’s precluding testimony from its noninfringement expert as a sanction for violating an order in limine. See 02 Micro Int’l Ltd. v. Beyond Innovation Tech. Co., No. 2:04-CV-0032, 2009 WL 2047617, at *3 (E.D.Tex. July 10, 2009) (“Sanctions Order ”). Because the district court did not clearly err in its finding that BiTEK induced infringement, did not abuse its discretion in precluding testimony from BiTEK’s noninfringement expert, and did not commit reversible error in granting the permanent injunction, we affirm.

BACKGROUND

This patent case relates to integrated circuits that control the power delivered to fluorescent lamps that light electronic displays, such as liquid crystal displays (LCDs) used by computers, laptops, and smart phones. The integrated circuits are referred to as “current inverter controllers,” and both 02 Micro and BiTEK design and sell these controllers.

The issues on appeal focus on the commercial relationships and global nature of the marketplace for current inverter controllers and their end products rather than the technical details of the asserted patents or the accused products. BiTEK, which is headquartered in Asia, manufactures current inverter controllers in Taiwan and sells the controllers to companies in Asia that combine them with other circuit components to create inverter control modules. BiTEK’s customers in turn sell the modules in Asia to companies such as Samsung, which incorporate the modules into LCD products and import those products into the United States.

This case has a long procedural history. In 2004, 02 Micro sued BiTEK and a number of other defendants in the U.S. District Court for the Eastern District of Texas, alleging that BiTEK induced infringement of the '615 and '722 patents. In a separate lawsuit brought against Samsung in the same court, 02 Micro alleged that Samsung’s LCD products contained current inverter technology that directly infringed the '615 and '722 patents.

02 Micro’s infringement action against BiTEK was tried to a jury in 2006. Prior to trial, the district court entered the following in limine order relating to 02 Micro’s incorporation in the Cayman Islands:

4. Preclude evidence relating to 02’s selection of Cayman Islands for its headquarters: Granted in part and denied in part. Defendants may refer to the fact that 02 is a Cayman Island corporation. The motion is granted to the extent defendants seek to offer evidence relating to taxation.

Sanctions Order, 2009 WL 2047617, at *1. 02 Micro prevailed in the first case, and the district court, applying the factors recited in eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 126 S.Ct. 1837, 164 L.Ed.2d 641 (2006), imposed a permanent injunction. About one month later, 02 Micro and Samsung entered into a settlement agreement (the “Samsung Agreement”). The Samsung Agreement is marked confidential and we disclose here only such information as is necessary to explain our decision. The Agreement contains three key provisions for the purposes [926]*926of this appeal: a covenant not to sue Samsung or its customers; an “abide by” clause that requires Samsung to abide by the terms of any injunctions entered; and a supply agreement. J.A.1969-70.

BiTEK appealed from the district court’s judgment. On appeal, we vacated the district court’s infringement judgment and remanded the case for a second trial because the district court failed to resolve the parties’ dispute on claim scope and allowed the parties to submit to the jury competing expert testimony on the claim construction issue. O2 Micro Int’l Ltd. v. Beyond Innovation Tech. Co., 521 F.3d 1351, 1361-63 (Fed.Cir.2008).

Prior to a second jury trial, the district court restated the in limine order regarding 02 Micro’s selection of the Cayman Islands as its headquarters. Sanctions Order, 2009 WL 2047617, at *1. During the pretrial conference, the district court warned counsel to approach the bench before they “launch into something that’s covered by the motion in limine.” J.A. 286-87.

During jury selection in the second case, 02 Micro’s counsel informed the jury panel that 02 Micro was headquartered in the Cayman Islands. Sanctions Order, 2009 WL 2047617, at *2. During BiTEK’s allotment for jury selection, BiTEK’s counsel stated that “BiTEK was a little bit surprised when it was sued in Texas by this Cayman Island company, 02 Micro.” J.A. 467. Shortly thereafter, without approaching the bench, he asked the jury panel the following question:

Now, are there any of you who have a problem with a company that puts its headquarters offshore on a Caribbean island in order to avoid paying U.S. taxes?

J.A. 472; Sanctions Order, 2009 WL 2047617, at *2. 02 Micro objected. The district court, after holding a bench conference and a hearing, found that BiTEK’s counsel had willfully violated the in limine order and held BiTEK’s counsel in contempt. Id. At 02 Micro’s election, the district court declared a mistrial and reset the case for trial before a new jury. Order, O2 Micro Int’l Ltd. v. Beyond Innovation Tech. Co., No. 2:04-CV-0032 (E.D.Tex. July 21, 2009), ECF No. 625; Sanctions Order, 2009 WL 2047617, at *3.

The court also imposed a variety of sanctions against BiTEK. Those sanctions included (1) imposing on BiTEK the costs and attorney fees incurred by all parties for the first jury selection; (2) severing BiTEK from the other defendants; (3) awarding the costs and attorney fees incurred by 02 Micro for trying its case against the severed defendants; (4) limiting BiTEK’s voir dire time and number of peremptory challenges in the second jury selection; (5) instructing the jury panel that BiTEK received limited time to conduct voir dire because it intentionally violated a court order resulting in the dismissal of the previous jury and the summoning of the second jury panel; and (6) precluding BiTEK from presenting expert witness testimony on the issue of infringement. Id. at *2-*3.

The case then proceeded to the second jury trial. On the second day of trial, upon questioning by the district court, Bi-TEK withdrew its state law counterclaims of sham litigation. J.A. 8089-93. Because 02 Micro only sought equitable relief for BiTEK’s alleged infringement, the case proceeded by agreement to a bench trial. Id.

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Bluebook (online)
449 F. App'x 923, Counsel Stack Legal Research, https://law.counselstack.com/opinion/o2-international-ltd-v-beyond-innovation-technology-co-ltd-cafc-2011.