Summit 6, LLC v. Samsung Electronics Co., Ltd.

United States Court of Appeals

for the Federal Circuit

______________________

SUMMIT 6, LLC,

Plaintiff-Cross Appellant

v.

SAMSUNG ELECTRONICS CO., LTD.,

SAMSUNG TELECOMMUNICATIONS AMERICA,

LLC,

Defendants-Appellants

______________________

2013-1648, -1651

______________________

Appeals from the United States District Court for the

Northern District of Texas in No. 11-CV-0367, Judge Reed

O'Connor.

______________________

Decided: September 21, 2015

______________________

THEODORE STEVENSON, III, McKool Smith, P.C., Dal-

las, TX, argued for plaintiff-cross appellant. Also repre-

sented by DOUGLAS AARON CAWLEY, PHILLIP AURENTZ,

RICHARD ALAN KAMPRATH; JOEL LANCE THOLLANDER,

JOHN BRUCE CAMPBELL, GRETCHEN CURRAN, KATHY

HSINJUNG LI, Austin, TX; BRADLEY WAYNE CALDWELL,

Caldwell, Cassady & Curry, Dallas, TX.

2 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

CARTER GLASGOW PHILLIPS, Sidley Austin LLP, Wash-

ington, DC, argued for defendants-appellants. Also repre-

sented by JOSEPH GUERRA, RACHEL HEATHER TOWNSEND.

______________________

Before PROST, Chief Judge, REYNA, and HUGHES, Circuit

Judges.

REYNA, Circuit Judge.

This appeal is from a final judgment entered on a jury

verdict in a patent case. The jury found the asserted

claims of U.S. Patent No. 7,765,482 (“the ’482 patent”) not

invalid and infringed. The jury awarded Appellee-Cross

Appellant Summit 6, LLC (“Summit”) $15 million in

damages. The parties raise various issues relating to the

proper legal framework for evaluating reasonable royalty

damages in the patent infringement context. Also before

us are questions regarding claim construction, infringe-

ment, invalidity, and the admissibility of expert testimo-

ny. For the reasons explained below, we affirm.

I. BACKGROUND

A. The ’482 Patent

Summit is the owner by assignment of the ’482 pa-

tent, entitled “Web-based Media Submission Tool.” The

’482 patent relates to the processing of digital content,

such as digital photos. ’482 patent at col. 1 ll. 11-14. The

invention “provides an improved web-based media sub-

mission tool” that includes “several unique and valuable

functions.” Id. at col. 2 ll. 7-8. The embodiment described

in the specification focuses on a tool used to submit photos

to a website. Id. at col. 2 ll. 44-60, col. 3 ll. 55-64. This

embodiment is described as software that allows a user to

place the photo into a website form either by dragging and

dropping the photo from the user’s computer or by using a

mouse click within the website. Id. at col. 3 ll. 20-48.

Among other things, the ’482 patent teaches a web-based

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 3

media submission tool with “a variable amount of intelli-

gent pre-processing on media objects prior to upload.” Id.

at col. 2 ll. 16-17.

The “intelligent preprocessing” taught by the ’482 pa-

tent includes the “ability to control the width and height

of the media object identifier and the ability to preprocess

the media objects in any number of ways prior to trans-

porting to a second location.” Id. at col. 4 ll. 53-56. The

patent describes this process in detail:

[T]he [invention] may resize the image, (i.e., in-

crease or decrease its size as defined by either

physical dimensions, pixel count, or kilobytes).

Compression, for example, is a type of sizing. The

[invention] may also change the image’s file for-

mat, . . . change the quality setting of the image,

crop the image or change the aspect ratio, add text

or annotations, encode or combine . . . the media

object, or enhance the media object by changing

image values, for example, relating to contrast or

saturation.

Id. at col. 4 ll. 57-67.

Summit asserted independent claim 38 and depend-

ent claims 40, 44-46, and 49 at trial. Claim 38 recites:

38. A computer implemented method for pre-

processing digital content in a client device for

subsequent electronic distribution, comprising:

a. initiating, by said client device, a transfer of

digital content from said client device to a server

device, said digital content including one or more

of image content, video content, and audio con-

tent;

b. pre-processing said digital content at said client

device in accordance with one or more pre-

processing parameters, said one or more pre-

4 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

processing parameters being provided to said cli-

ent device from a device separate from said client

device, said one or more pre-processing parame-

ters controlling said client device in a placement

of said digital content into a specified form in

preparation for publication to one or more devices

that are remote from a server device and said cli-

ent device; and

c. transmitting a message from said client device

to said server device for subsequent distribution

to said one or more devices that are remote from

said server device and said client device, said

transmitted message including said pre-processed

digital content.

Id. at col. 13 l. 56-col. 14 l. 14 (emphases added to rele-

vant terms).

B. Procedural History

On February 23, 2011, Summit sued Samsung Elec-

tronics Co., Ltd., Samsung Telecommunications America

LLC (collectively, “Samsung”), Research in Motion Lim-

ited, Research in Motion Corp. (collectively, “RIM”),

Facebook, Inc. (“Facebook”), and other defendants assert-

ing infringement of the ’482 patent. Summit asserted

that the process of sending photographs via the multime-

dia messaging service (“MMS”) as used by smartphones

and tablets designed, manufactured, and sold by Samsung

infringes the ’482 patent.

In the district court, the parties disputed the proper

meaning of fourteen claim terms. As relevant to this

appeal, the parties disputed the proper meaning of “publi-

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 5

cation/publishing” and “receiving”/“provided to.” 1 Sam-

sung contended that “publication” should be construed to

mean “making the digital content publicly available (e.g.

posting the digital content on a web page)” in order to

differentiate the term from “transmitting” and “distribu-

tion.” Summit argued that publication requires no con-

struction and, if it does, it should be “sharing.” Regarding

the “receiving”/“provided to” terms, Samsung argued that

claim 38 required the active receipt of the pre-processing

parameters during the operation of the claimed method.

Samsung contended that the receipt of the pre-processing

parameters must occur during the operation of the meth-

od. Summit argued that the receipt of pre-processing

parameters required ongoing activity, but could also

encompass the receipt of the pre-processing parameters

prior to the commencement of the claimed method.

On May 21, 2012, the district court issued an order

construing the disputed claim terms. Regarding “publica-

tion,” the district court agreed with Samsung and con-

strued the term to mean “making publicly available.” The

district court declined to construe the “receiv-

ing”/“provided to” terms, finding that the terms required

no construction. RIM settled thereafter.

On October 22, 2012, Samsung filed a motion for

summary judgment of non-infringement. The district

court denied Samsung’s motion as to literal infringement,

finding that a genuine issue of material fact existed as to

whether Samsung’s products perform the recited pre-

processing step. The court granted other aspects of Sam-

sung’s motion, finding that prosecution history estoppel

1 The “receiving”/“provided to” terms include “re-

ceiving . . . from a remote device,” “received from a device

separate from a client device,” and “provided to said client

device by a device separate from said client device.”

6 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

bars application of the doctrine of equivalents to the pre-

processing step. Soon thereafter, Facebook settled. 2

Samsung was then the only remaining defendant.

Beginning on March 29, 2013, the district court held a

six-day jury trial. During trial the parties presented

competing evidence regarding the provision of pre-

processing parameters to the client device. Summit

contended that receipt of the pre-processing parameters

during the operation of the method was not required.

Summit’s expert, Dr. Mark Jones, testified that even if

active receipt during the operation of the method is re-

quired, Samsung phones receive parameters when phones

are reflashed or when software updates are provided.

Samsung’s expert, Dr. Earl Sacerdoti, explained that

active receipt of the parameters is required and the pre-

processing parameters are not provided to any accused

Samsung device during any pre-processing operations.

On the “publication” limitation, Summit contended

that Samsung’s accused devices prepare the images for

“publication.” Summit’s expert, Dr. Jones, explained that

when an image is resized in Samsung phones, the digital

content is placed in a form in preparation for both trans-

mission and publication. Samsung’s expert,

Dr. Sacerdoti, explained that any alterations to the image

during the MMS process are done to meet carrier trans-

mission requirements for message size limits, not to

prepare the message for publication.

Summit then presented evidence of damages through

its expert Mr. Paul Benoit. Mr. Benoit explained that

Samsung would have agreed in a hypothetical negotiation

2 Facebook was also accused of infringing U.S. Pa-

tent No. 6,895,557 (“the ’557 patent”). The ’482 patent is

a continuation of the ’557 patent.

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 7

to pay Summit $0.28 per phone to provide the infringing

features on their phones over the life of the patent.

Mr. Benoit acknowledged that he relied on a methodology

not previously used or published in peer-reviewed jour-

nals. Samsung’s expert, Mr. Christopher Martinez,

testified that because infringement takes place at the

software level, no company would agree to pay a running

royalty on a phone. He testified that a proper royalty

would be a $1.5 million lump sum. He based this conclu-

sion on two license agreements.

After the close of Summit’s case-in-chief, Samsung

presented evidence that it asserted showed that the ’482

patent is invalid over U.S. Patent No. 6,038,295

(“Mattes”). At trial, the parties agreed that the basic

operation of the system disclosed in Mattes included

taking a picture, pre-processing the picture, and transmit-

ting the picture to a server over a wireless network.

Summit’s expert, Dr. Jones, testified that Mattes fails to

disclose the pre-processing step of claim 38 because the

imaging device does not “know” that a photo has met the

server’s specification when the photo is transmitted.

Dr. Jones further testified that the limitations of claims

40 and 46 were similarly not disclosed by Mattes.

The jury returned a verdict on April 5, 2013, finding

the five asserted claims of the ’482 patent not invalid and

infringed. The jury awarded Summit $15 million in

damages. The jury indicated on the verdict form that this

was a lump sum award.

The parties filed post-trial motions. The district court

granted Samsung’s pre-verdict motion for judgment as a

matter of law (“JMOL”) of no direct infringement and

denied all other pre-verdict motions. The district court

denied all of Samsung’s post-verdict motions except its

motion to reduce prejudgment interest.

The parties timely appealed. We have jurisdiction

under 28 U.S.C. § 1295(a)(1).

8 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

II. DISCUSSION

A. Claim Construction

On appeal, the parties dispute whether the asserted

claims of the ’482 patent require that pre-processing

parameters be provided to the client device during the

computer-implemented method for pre-processing digital

content or whether it can occur prior to operation of the

method. Samsung argues that the district court erred in

declining to construe the term “being provided to” as used

in claim 38 because this term requires the provision of the

pre-processing parameters during the operation of the

method. Samsung contends that this ongoing activity is

compelled not only by the language of the claim, but also

by the language of other claims and the prosecution

history.

Summit asks that we conclude Samsung waived the

argument that “being provided to” requires that the pre-

processing parameters be provided to the device during

the operation of the method. In the alternative, Summit

argues that there is no evidence to support Samsung’s

proposed limitation on the claim language. Summit

contends that “being provided to” is not a verb requiring

ongoing activity, but instead a phrase functioning as an

adjective that describes a characteristic of “said . . . pa-

rameters.”

We first address the issue of waiver. To avoid waiver,

a party’s argument at trial and the appellate level should

be consistent. Finnigan Corp. v. Int’l Trade Comm’n, 180

F.3d 1354, 1363 (Fed. Cir. 1999). We find that Samsung

has argued throughout this action that the claimed provi-

sion of pre-processing parameters must be performed as

an active step of the claimed method. Samsung’s argu-

ment on this issue has been sufficiently consistent to

negate a finding of waiver. For these reasons, we con-

clude that Samsung has not waived its argument. We

now turn to the merits of the claim construction dispute.

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 9

Claim construction is generally a matter of law that

we review de novo, but it may have underlying factual

determinations that are reviewed for clear error. Teva

Pharm. USA, Inc. v. Sandoz, Inc., 135 S. Ct. 831, 837

(2015). The process of construing a claim term begins

with the words of the claims. Phillips v. AWH Corp., 415

F.3d 1303, 1312-14 (Fed. Cir. 2005) (en banc); Vitronics

Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed. Cir.

1996). However, the claims “must be read in view of the

specification, of which they are a part.” Phillips, 415 F.3d

at 1315 (quoting Markman v. Westview Instruments, Inc.,

52 F.3d 967, 979 (Fed. Cir. 1995) (en banc), aff’d, 517 U.S.

370 (1996)). Additionally, the doctrine of claim differenti-

ation disfavors reading a limitation from a dependent

claim into an independent claim. See InterDigital

Commc’ns, LLC v. Int’l Trade Comm’n, 690 F.3d 1318,

1324 (Fed. Cir. 2012). Although courts are permitted to

consider extrinsic evidence, like expert testimony, dic-

tionaries, and treatises, such evidence is generally of less

significance than the intrinsic record. Phillips, 415 F.3d

at 1317 (citing C.R. Bard, Inc. v. U.S. Surgical Corp., 388

F.3d 858, 862 (Fed. Cir. 2004)). Extrinsic evidence may

not be used “to contradict claim meaning that is unam-

biguous in light of the intrinsic evidence.” Id. at 1324.

While the parties focus on the words “being provided

to,” the surrounding language of the claim is instructive.

The relevant limitation of claim 38 requires:

b. pre-processing said digital content at said client

device in accordance with one or more pre-

processing parameters, said one or more pre-

processing parameters being provided to said cli-

ent device from a device separate from said client

device, . . . ;

’482 patent at col. 14 ll. 1-5 (emphasis added). We find

that “being provided to” is not used as a verb in claim 38,

but instead is a part of a phrase that conveys information

10 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

about the “pre-processing parameters.” In this claim, the

pre-processing parameters are “being provided to” the

client device from a second device. Id. This is not a step

in the claimed method. It is, instead, a phrase that

characterizes the claimed pre-processing parameters. The

use of the term “said” indicates that this portion of the

claim limitation is a reference back to the previously

claimed “pre-processing parameters.” See Baldwin

Graphic Sys., Inc. v. Siebert, Inc., 512 F.3d 1338, 1343

(Fed. Cir. 2008) (noting that claims using the term “said”

are “anaphoric phrases, referring to the initial antecedent

phrase”). That the pre-processing parameters come from

a second device is merely a characteristic of the parame-

ters. It is not a step of the method, nor does it require

current or ongoing activity.

Further, the district court did not err in declining to

construe the term. While the court must resolve actual

disputes regarding the proper scope of a claim term, O2

Micro Int’l Ltd. v. Beyond Innovation Tech. Co., 521 F.3d

1351, 1360 (Fed. Cir. 2008), restating a settled argument

does not create an actual dispute within the meaning of

O2 Micro, Finjan, Inc. v. Secure Computing Corp.,

626 F.3d 1197, 1207 (Fed. Cir. 2010). At the claim con-

struction stage, the district court rejected Samsung’s

argument that ongoing activity is required—the heart of

the parties’ disagreement—and declined to further con-

strue the term because it was a “straightforward term”

that required no construction. J.A. 45. “Being provided

to” is comprised of commonly used terms; each is used in

common parlance and has no special meaning in the art.

Because the plain and ordinary meaning of the disputed

claim language is clear, the district court did not err by

declining to construe the claim term.

Samsung contends that the district court read a limi-

tation out of claim 38 by refusing to construe this term.

Samsung argues that by failing to limit the claim to active

receipt of the pre-processing parameters, the district court

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 11

effectively read the “being provided to” language out of

the claim. We disagree. That the pre-processing parame-

ters are on the client device and that they have come from

a second device must be proved, just like any other limita-

tion. The claim term “being provided to,” however, does

not limit the claim to the provision of pre-processing

parameters only during the operation of the method.

Samsung argues that other claims use language that

clearly indicates temporal activity and concludes that the

“being provided to” term must indicate present and ongo-

ing activity. Samsung suggests that claims 36, 37, and

51, use language that indicates a past activity. ’482

patent at col. 13 ll. 21-22 (“pre-processing parameters that

were provided to said client device . . .”), col. 13 ll. 45-46

(“pre-processing parameters that were provided to said

client device . . . ”), col. 14 ll. 49-50 (“pre-processing pa-

rameters that have been provided to . . .”). Yet, other

claims use language indicating that the provision must

occur during the operation of the claimed method. Id. at

claim 26, col. 9 ll. 23-24 (“receiving pre-processing param-

eters from a remote device . . . ”), claim 12, col. 10 ll. 43-44

(“receiving pre-processing parameters from a remote

device . . . . ”). Neither of these sets of claims, however,

provides an indication of what the applicants intended

when they chose the phrase “being provided to,” and the

plain meaning of this term does not clearly delineate the

temporal limitation Samsung suggests.

Samsung points to the prosecution history to support

its position, arguing that amendments to other claims

show that claim 38 requires ongoing activity during

operation of the method. This argument misinterprets

the prosecution history. During prosecution, the appli-

cant presented claims reciting “previously received pre-

processing parameters” in the third limitation of each

claim. J.A. 25153-56 (claims 16, 23, and 26). The exam-

iner rejected these claims as indefinite under 35 U.S.C.

§ 112 para. 2. The examiner stated:

12 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

The step of “pre-processing” in claims 16, 23, and

26 recite “previously received pre-processing pa-

rameter.” [sic] Since the claims are not shown

[sic] any previously received parameter prior to

the “pre-processing” step, such language is indefi-

nite.

J.A. 25179. In response, the applicant amended the first

limitation of these claims to recite “receiving pre-

processing parameters . . . ,” thus showing the receipt of

the parameters referenced in the third limitation and

creating the proper basis for receipt of the “previously

received parameters.” This does not preclude prior re-

ceipt as to either these claims, or to claim 38, which was

subsequently added.

Finally, Samsung argues that the preamble is limiting

because it “provides context essential to understanding

the corresponding steps in the body of the claim” because

it is the only part of the claim that refers to the advance

over the prior art. Appellants’ Opening Br. at 41. Sam-

sung concludes that because the preamble is limiting,

provision of the parameters must happen during the pre-

processing step. We disagree that the preamble here is

limiting. Generally, a preamble is not limiting. Symantec

Corp. v. Computer Assocs. Int’l, Inc., 522 F.3d 1279, 1288

(Fed. Cir. 2008). For example, “[p]reamble language that

merely states the purpose or intended use of an invention

is generally not treated as limiting the scope of the claim.”

Pacing Techs., LLC v. Garmin Int’l, Inc., 778 F.3d 1021,

1023-24 (Fed. Cir. 2015) (quoting Bicon, Inc. v. Strau-

mann Co., 441 F.3d 945, 952 (Fed. Cir. 2006)). Samsung

does not contend that the preamble to claim 38 is neces-

sary to provide antecedent basis or that the applicant

placed clear reliance on the preamble during prosecution.

See Pacing, 778 F.3d at 1024 (“Because the preamble

terms . . . provide antecedent basis for and are necessary

to understand positive limitations in the body of claims

. . . , we hold that the preamble to claim 25 is limiting.”).

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 13

Moreover, the preamble to claim 38 is duplicative of the

limitations in the body of the claim and merely provides

context for the limitations. See Symantec, 522 F.3d at

1288-89.

In sum, the district court properly rejected Samsung’s

argument that the “being provided to” language of claim

38 requires that the pre-processing parameters are pro-

vided to the client device during operation of the claimed

method. We affirm the district court’s denial of the mo-

tion for new trial based on claim construction.

B. Infringement

After the jury returned its verdict finding the five as-

serted claims of the ’482 patent not invalid and infringed,

the district court denied Samsung’s pre-verdict JMOL of

no indirect infringement.

Samsung argues that the jury’s verdict on indirect in-

fringement is not supported by substantial evidence

because Samsung’s accused phones do not pre-process “in

preparation for publication.” Samsung argues that under

the district court’s constructions, Summit was required to

show that Samsung’s accused phones modify a digital

image in preparation for making the image publicly

available. Samsung argues that Summit failed to make

such a showing. We disagree.

A denial of a motion for JMOL is not unique to patent

law, and thus, we apply the law of the regional circuit,

here the Fifth Circuit. Transocean Offshore Deepwater

Drilling, Inc. v. Maersk Drilling USA, Inc., 699 F.3d 1340,

1346-47 (Fed. Cir. 2012). Under Fifth Circuit law, a

district court’s decision on a motion for JMOL is reviewed

de novo, reapplying the JMOL standard. Ford v. Cimar-

ron Ins. Co., Inc., 230 F.3d 828, 830 (5th Cir. 2000) (citing

Omnitech Int’l, Inc. v. Clorox Co., 11 F.3d 1316, 1322-23

(5th Cir. 1994)). JMOL is appropriate when a party has

been fully heard on an issue and there is no legally suffi-

14 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

cient evidentiary basis for a reasonable jury to find for

that party on that issue. Fed. R. Civ. P. 50(a)(1).

The jury heard evidence from Summit’s expert,

Dr. Jones, that Samsung’s accused devices perform the

methods of the asserted claims. Dr. Jones explained that

the carriers dictate image height and width resolution

parameters to maintain image quality in preparation for

publication. J.A. 6128-29, 7282-83. Dr. Jones also ex-

plained that the pre-processing performed by Samsung’s

phones is in preparation for publication. J.A. 7283.

Dr. Jones outlined the difference between preparing for

transmission and preparing for publication. J.A. 6149-50.

Dr. Jones noted that if the pre-processing were only for

transmission, Samsung could use an “extremely low

JPEG quality parameter” that “would likely look terrible

at the end but it would be quite small.’’ J.A. 7283.

Samsung’s expert, Dr. Sacerdoti, admitted that the

source code contained in each of the phones has a configu-

rable maximum file size as dictated by the carriers.

J.A. 7001. Dr. Sacerdoti agreed with Dr. Jones that the

carrier requirements for image resolution were related to

how an image is viewed on the screen. J.A. 7000. He also

agreed that the carrier requirements for image resolution

were not transmission requirements. Id.

Both parties were fully heard on this issue, and there

exists legally sufficient evidentiary basis for a reasonable

jury to find for Summit on this issue. This evidence

supports the jury’s verdict finding that Samsung’s ac-

cused devices perform the methods of the asserted claims.

Thus, the district court did not err in denying Sam-

sung’s JMOL with respect to infringement.

C. Invalidity

At trial, Samsung argued that the ’482 patent was in-

valid as anticipated by the prior art reference Mattes.

After the jury returned its verdict finding the five assert-

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 15

ed claims of the ’482 patent not invalid and infringed, the

district court denied Samsung’s pre-verdict JMOL of

invalidity.

Samsung argues that the evidence does not support

the jury’s verdict that the ’482 patent is not invalid.

Samsung argues that it presented clear and convincing

evidence of invalidity. We disagree.

A party challenging the validity of a patent must es-

tablish invalidity by clear and convincing evidence. See

Microsoft Corp. v. i4i Ltd. ––– U.S. ––––, 131 S. Ct. 2238,

2242 (2011). Anticipation is a factual question that we

review for substantial evidence when appealed from a

jury verdict. SynQor, Inc. v. Artesyn Techs., Inc., 709 F.3d

1365, 1373 (Fed. Cir. 2013). A claim is anticipated only if

each and every element is found within a single prior art

reference, arranged as claimed. See NetMoneyIN, Inc. v.

VeriSign, Inc., 545 F.3d 1359, 1369 (Fed. Cir. 2008).

The jury heard evidence from Summit’s expert,

Dr. Jones, that at least one element of each asserted claim

was missing from that reference. At trial, Dr. Jones

focused his testimony regarding the prior art Mattes

patent on the pre-processing requirements of the ’482

patent. Specifically, Dr. Jones testified that Mattes fails

to disclose limitation (b) of claim 38: “one or more pre-

processing parameters controlling said client device in a

placement of said digital content into a specified form.”

Dr. Jones testified that in Mattes it is the server—not the

client device—that contains the software for pre-

processing the image and that Mattes does not disclose

performing the image analysis on the client device.

J.A. 7271, 7273.

The jury heard expert testimony from both sides. The

jury verdict is supported by substantial evidence, and we

have no cause to disturb it. Thus, the district court did

not err in denying Samsung’s JMOL with respect to

invalidity.

16 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

D. Expert Testimony

Samsung appeals the district court’s denial of Sam-

sung’s JMOL motion to exclude Mr. Benoit’s testimony.

Samsung contends that Mr. Benoit’s analysis fails the

standards set forth by Daubert v. Merrell Dow Pharma-

ceuticals, Inc., 509 U.S. 579 (1993). First, Samsung

argues that Mr. Benoit’s methodology was unpublished,

created specifically for this litigation, and never before

employed by Mr. Benoit or by another expert. Second,

Samsung argues that Mr. Benoit’s “premise . . . that a

feature’s use is proportional to its value” was incorrect

and contradicted by other expert testimony. Defendant-

Appellant’s Opening Br. at 6. Third, Samsung questions

the reliability of Mr. Benoit’s use of surveys because

Mr. Benoit is not a survey expert and failed to take the

basic steps required of a secondary expert who purports to

give an opinion based on a third party’s survey.

Summit responds that Mr. Benoit’s analysis was not

“novel and untested” because it was within the framework

of Georgia–Pacific Corp. v. U.S. Plywood Corp., 318 F.

Supp. 1116 (S.D.N.Y. 1970). Summit contends that

Mr. Benoit was not a secondary expert, but a primary

expert, because he “simply used Samsung’s surveys in his

Georgia-Pacific analysis.” Plaintiff-Cross-Appellant’s Br.

at 51.

Whether proffered evidence is admissible at trial is a

procedural issue not unique to patent law, and we there-

fore review the district court’s decision to admit expert

testimony under the law of the regional circuit, here the

Fifth Circuit. Micro Chem., Inc. v. Lextron, Inc., 317 F.3d

1387, 1390-91 (Fed. Cir. 2003) (citing Bose Corp. v. JBL,

Inc., 274 F.3d 1354, 1360 (Fed. Cir. 2001)). The Fifth

Circuit reviews the admissibility of expert testimony for

abuse of discretion. Primrose Operating Co. v. Nat’l Am.

Ins. Co., 382 F.3d 546, 561 (5th Cir. 2004) (citing Vogler v.

Blackmore, 352 F.3d 150, 154 (5th Cir. 2003)). The ques-

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 17

tion here, therefore, is whether the district court abused

its discretion in deciding that Summit’s expert testimony

was admissible. We conclude that it did not.

In Daubert, the Supreme Court set out the require-

ments for admissibility of expert testimony. 509 U.S. 579

(1993). The Supreme Court stated that the trial judge

plays a “gatekeeping role,” id. at 597, which “entails a

preliminary assessment of whether the reasoning or

methodology underlying the testimony is scientifically

valid and of whether that reasoning or methodology

properly can be applied to the facts in issue.” Id. at 592–

93. The Court emphasized that the focus “must be solely

on principles and methodology, not on the conclusions

that they generate.” Id. at 595. This admissibility as-

sessment, while a flexible one, may consider the following

factors: (1) whether the methodology is scientific

knowledge that will assist the trier of fact; (2) whether the

methodology has been tested; (3) whether the methodolo-

gy has been published in peer-reviewed journals; (4)

whether there is a known, potential rate of error; and (5)

whether the methodology is generally accepted. Id. at

591-95.

The admissibility of expert evidence is also governed

by Rules 702 and 703 of the Federal Rules of Evidence.

“Rule 702 was amended in response to Daubert and cases

applying it, including Kumho Tire.” Micro Chem., 317

F.3d at 1391 (citing Kumho Tire Co. v. Carmichael, 526

U.S. 137, 150 (1999)). Rule 702 states:

A witness who is qualified as an expert by

knowledge, skill, experience, training, or educa-

tion may testify in the form of an opinion or oth-

erwise if:

(a) the expert’s scientific, technical, or other spe-

cialized knowledge will help the trier of fact to

understand the evidence or to determine a fact in

issue;

18 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

(b) the testimony is based on sufficient facts or da-

ta;

(c) the testimony is the product of reliable princi-

ples and methods; and

(d) the expert has reliably applied the principles

and methods to the facts of the case.

Fed. R. Evid. 702. Rule 703 states:

An expert may base an opinion on facts or data in

the case that the expert has been made aware of

or personally observed. If experts in the particular

field would reasonably rely on those kinds of facts

or data in forming an opinion on the subject, they

need not be admissible for the opinion to be ad-

mitted. But if the facts or data would otherwise be

inadmissible, the proponent of the opinion may

disclose them to the jury only if their probative

value in helping the jury evaluate the opinion

substantially outweighs their prejudicial effect.

Fed. R. Evid. 703.

Under these rules, a district court may exclude evi-

dence that is based upon unreliable principles or methods,

legally insufficient facts and data, or where the reasoning

or methodology is not sufficiently tied to the facts of the

case. See, e.g., Kumho Tire, 526 U.S. at 150 (the gate-

keeping inquiry must be tied to the particular facts of the

case); i4i Ltd. v. Microsoft Corp., 598 F.3d 831, 854 (Fed.

Cir. 2010) (stating that “Daubert and Rule 702 are safe-

guards against unreliable or irrelevant opinions, not

guarantees of correctness”). But the question of whether

the expert is credible or the opinion is correct is generally

a question for the fact finder, not the court. Apple Inc. v.

Motorola, Inc., 757 F.3d 1286, 1314 (Fed. Cir. 2014),

overruled en banc in part not relevant here, Williamson v.

Citrix Online, LLC, 792 F.3d 1339, 1349 (Fed. Cir. 2015).

Indeed, “[v]igorous cross-examination, presentation of

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 19

contrary evidence, and careful instruction on the burden

of proof are the traditional and appropriate means of

attacking shaky but admissible evidence.” Daubert, 509

U.S. at 596.

This court has recognized that estimating a reasona-

ble royalty is not an exact science. The record may sup-

port a range of reasonable royalties, rather than a single

value. Likewise, there may be more than one reliable

method for estimating a reasonable royalty. Apple, 757

F.3d at 1315. A party may use the royalty rate from

sufficiently comparable licenses, value the infringed

features based upon comparable features in the market-

place, or value the infringed features by comparing the

accused product to non-infringing alternatives. Id. A

party may also use what this court has referred to as “the

analytical method,” focusing on the infringer’s projections

of profit for the infringing product. Lucent Techs., 580

F.3d at 1324.

All approaches have certain strengths and weakness-

es, and, depending upon the facts, one or all may produce

admissible testimony in a particular case. Because each

case presents unique circumstances and facts, it is com-

mon for parties to choose different, reliable approaches in

a single case and, when they do, the relative strengths

and weaknesses of each approach may be exposed at trial

or attacked during cross-examination. That one approach

may better account for one aspect of a royalty estimation

does not make other approaches inadmissible.

In sum, while all approximations involve some degree

of uncertainty, the admissibility inquiry centers on

whether the methodology employed is reliable. Daubert,

509 U.S. at 589-595. A distinct but integral part of that

inquiry is whether the data utilized in the methodology is

sufficiently tied to the facts of the case. Kumho Tire, 526

U.S. at 150. Hence, a reasonable or scientifically valid

methodology is nonetheless unreliable where the data

20 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

used is not sufficiently tied to the facts of the case. See,

e.g., LaserDynamics, Inc. v. Quanta Computer, Inc., 694

F.3d 51, 78-81 (Fed. Cir. 2012) (granting a new trial

because damages testimony relied upon licenses that were

not comparable and therefore not relevant). Likewise,

ideal input data cannot save a methodology that is

plagued by logical deficiencies or is otherwise unreasona-

ble. See Daubert, 509 U.S. at 592-93 (the court must

make “a preliminary assessment of whether the reasoning

or methodology underlying the testimony is scientifically

valid and of whether that reasoning or methodology

properly can be applied to the facts in issue) (emphasis

added). But where the methodology is reasonable and its

data or evidence are sufficiently tied to the facts of the

case, the gatekeeping role of the court is satisfied, and the

inquiry on the correctness of the methodology and of the

results produced thereunder belongs to the factfinder.

To estimate a reasonable royalty rate in this case,

Mr. Benoit started by estimating that the carriers pay

Samsung $14.15 to include a camera component in Sam-

sung’s phones. J.A. 6372. To arrive at this estimate,

Mr. Benoit used Samsung’s annual reports, internal cost

and revenue spreadsheets, and interrogatory responses to

determine that the camera component accounted for 6.2%

of the phone’s overall production cost. J.A. 6374. Accord-

ingly, he attributed 6.2% of Samsung’s revenue from

selling each phone—i.e., $14.15—to the camera’s func-

tionality. J.A. 6374.

To apportion the camera-related revenue further,

Mr. Benoit estimated the percentage of camera users who

used the camera to perform the infringing methods rather

than for other purposes. To do this, he relied on surveys

commissioned by Samsung in the ordinary course of its

business and on another survey he found on his own. J.A.

6374-75. The surveys were conducted by J.D. Power and

Associates, Pugh Research, Forrester, and ComScore.

J.A. 6375. Using the surveys, Mr. Benoit estimated that

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 21

at least 65.3% of camera users used the camera regularly

to capture only photos rather than video. J.A. 6377-79.

He calculated that at least 77.3% of those users who

captured only photos shared the photos, and that at least

41.2% of those users who shared the photos did so by

MMS rather than by email or web storage. J.A. 6379-84.

Lastly, Mr. Benoit observed that 100% of those photos

shared by MMS were resized. J.A. 6384. Multiplying

these percentages together, Mr. Benoit thus estimated

that at least 20.8% of camera users utilized the camera

for the infringing features rather than for other camera-

related features.

Based on these usage statistics, Mr. Benoit concluded

that 20.8% of Samsung’s $14.15 revenue for including the

camera component in each phone—i.e., $2.93—was due to

the infringing features. J.A. 6386. Using Samsung’s

annual reports to estimate its profit margins and capital

asset contributions, Mr. Benoit concluded that $0.56 of

the $2.93 revenue was profit attributable to the infringe-

ment. J.A. 6386-89.

Mr. Benoit testified that to determine a reasonable

royalty at a hypothetical negotiation, the parties would

focus on allocating the $0.56 benefit Samsung gained by

utilizing the patented features. Mr. Benoit testified that

the negotiation would concern the entire $0.56 benefit

because Samsung had no non-infringing alternatives, and

the entire benefit was therefore incremental profit from

using the patent. J.A. 6390. Mr. Benoit testified that

because neither party had a stronger negotiating position,

the parties would have split the $0.56 evenly to derive a

reasonable royalty of $0.28 per device. J.A. 6389-91,

6395. Mr. Benoit cited three academic articles and the

Nash Bargaining Solution to support his theory of an even

22 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

split. 3 Based on the per-device royalty and on the number

of infringing devices sold by Samsung, Mr. Benoit esti-

mated that a hypothetical negotiation would have result-

ed in a reasonable royalty of $29 million. J.A. 6398.

In Daubert, The Supreme Court has delineated cer-

tain factors to assist courts in evaluating the foundation

of a given expert’s testimony, while carefully emphasizing

the non-exhaustive nature of these factors. Suggested

considerations include whether the theory or technique

the expert employs is generally accepted, whether the

theory has been subjected to peer review and publication,

whether the theory can and has been tested, whether the

known or potential rate of error is acceptable, and wheth-

er there are standards controlling the technique’s opera-

tion. As the Fifth Circuit has noted, “[t]here is no

formula, and the court must judge admissibility based on

the particular facts of the case.” Wells v. SmithKline

Beecham Corp., 601 F.3d 375, 378-79 (5th Cir. 2010).

The Supreme Court has called the inquiry envisioned

by Rule 702 a “flexible one” and indicated that these

factors may be considered, but are not exhaustive. Daub-

ert, 509 U.S. at 594. The Fifth Circuit has held expert

testimony admissible even though multiple Daubert

factors were not satisfied. See, e.g., United States v.

Norris, 217 F.3d 262, 269-71 (5th Cir. 2000). Still, the

Supreme Court has warned that we must not “deny the

importance of Daubert’s gatekeeping requirement. The

objective of that requirement is to ensure the reliability

and relevancy of expert testimony.” Kumho Tire, 526 U.S.

at 152.

3 On appeal, Samsung does not challenge

Mr. Benoit’s use of Nash Bargaining.

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 23

In this case, Mr. Benoit’s damages methodology was

based on reliable principles and was sufficiently tied to

the facts of the case. Mr. Benoit first estimated Sam-

sung’s economic benefit from infringement by specifically

focusing on the infringing features and by valuing those

infringing features based on Samsung’s own data regard-

ing use and on its own financial reports outlining produc-

tion costs and profits. Mr. Benoit then envisioned a

hypothetical negotiation in which the parties would have

bargained for respective shares of the economic benefit,

given their respective bargaining positions and alterna-

tives to a negotiated agreement. Mr. Benoit’s methodolo-

gy was structurally sound and tied to the facts of the case.

That Mr. Benoit’s methodology was not peer-reviewed

or published does not necessitate its exclusion. We recog-

nize that the fact-based nature of Mr. Benoit’s damages

testimony made it impractical, if not impossible, to sub-

ject the methods to peer review and publication. But

“[p]ublication . . . is not a sine qua non of admissibility,”

and “in some instances well-grounded but innovative

theories will not have been published.” Daubert, 509 U.S.

at 593. Consequently, “[w]here an expert otherwise

reliably utilizes scientific methods to reach a conclusion,

lack of textual support may go to the weight, not the

admissibility of the expert’s testimony.” Knight v. Kirby

Inland Marine Inc., 482 F.3d 347, 354 (5th Cir. 2007)

(internal quotation marks omitted).

Samsung argues that Mr. Benoit’s “premise . . . that a

feature’s use is proportional to its value” was incorrect

and contradicted by expert testimony. Defendant-

Appellant’s Opening Br. at 6. But as we noted in Lucent,

“an invention used more frequently is generally more

valuable than a comparable invention used infrequently”

and “frequency of expected use and predicted value are

related.” 580 F.3d at 1333. There is no dispute that use

of the claimed invention is relevant under Georgia-Pacific:

24 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

Georgia-Pacific factor 11 looks at use of the invention and

at evidence probative of the value of that use. Here, the

district court did not abuse its discretion in determining

that Mr. Benoit’s methodology, involving the correlation

of use with value, was not unreliable.

Samsung’s argument that Mr. Benoit was unqualified

to rely on survey data compiled by third parties is also not

persuasive. As the district court held, Mr. Benoit need

not be a survey expert to testify about the information

compiled by third-party surveys, so long as the infor-

mation is of a type reasonably relied upon by experts in

the field to form opinions upon the subject.

To the extent Mr. Benoit’s credibility, data, or factual

assumptions have flaws, these flaws go to the weight of

the evidence, not to its admissibility. Once an expert has

been qualified, the trial court’s gatekeeping inquiry

focuses on the expert’s methodology and on whether the

methodology is sufficiently tied to the facts of the case.

Where the methodology is sound and the evidence relied

upon is sufficiently related to the case, disputes over the

expert’s credibility or over the accuracy of the underlying

facts are for the jury. See i4i, 598 F.3d at 852. Here,

Samsung cross-examined Mr. Benoit and, ultimately, the

jury evaluated Mr. Benoit’s opinions.

In sum, Samsung has not shown that the district

court abused its discretion in allowing Mr. Benoit to

testify regarding his apportionment methodology.

E. Damages

In its JMOL motion, Samsung argued that the jury’s

damages award of $15 million is not supported by sub-

stantial evidence. Samsung now argues that Mr. Benoit’s

analysis was flawed and that it should not have been

admitted, and therefore cannot support the damages

verdict. Samsung also argues that the Facebook and RIM

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 25

settlement agreements cannot support the damages

award because they are not sufficiently comparable.

Samsung argues there was no testimony at trial indicat-

ing that the Facebook license was comparable or relevant

in any way to what a reasonable royalty would have been

in this case. Further, Samsung argues that the RIM

license, alone, is insufficient to support the jury’s damages

award. Thus, Samsung concludes that substantial evi-

dence does not support the jury’s damages award. We

disagree.

35 U.S.C. § 284 provides that upon a finding of in-

fringement, “the court shall award the claimant damages

adequate to compensate for the infringement, but in no

event less than a reasonable royalty for the use made of

the invention by the infringer.” This court has held that a

reasonable method for determining a reasonable royalty is

the hypothetical negotiation approach, which “attempts to

ascertain the royalty upon which the parties would have

agreed had they successfully negotiated an agreement

just before infringement began.” Lucent Techs., Inc. v.

Gateway, Inc., 580 F.3d 1301, 1324 (Fed. Cir. 2009).

Samsung is correct that Summit failed to present evi-

dence that the Facebook license was comparable or rele-

vant to calculating a reasonable royalty in this case.

Because neither Summit’s brief nor our independent

review of Mr. Benoit’s testimony shows otherwise, we do

not address the Facebook license further.

The damages evidence presented by Summit at trial

included Mr. Benoit’s testimony regarding the apportion-

ment methodology and the RIM license agreement. In its

brief, Samsung conflates the issue of whether the RIM

license should have been excluded with whether the

license supported the jury’s damages verdict. See Appel-

lants’ Op. Br. at 65-67. Samsung does not challenge the

admission of the RIM license, and we therefore consider

only the issue of whether substantial evidence supports

26 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

the jury’s verdict, in view of the RIM license and

Mr. Benoit’s testimony.

Mr. Benoit’s testimony and the RIM license supported

the jury’s damages verdict. Mr. Benoit testified that the

RIM license conveys rights to the ’482 patent and that

both RIM and Samsung are similarly situated because

both sell camera phones containing the accused MMS

functionality. J.A. 6394, 6482-83. The jury also heard

evidence regarding the royalty amount in the RIM license

and about Samsung’s sales volume in comparison to

RIM’s. J.A. 6394-95. The RIM license was therefore

sufficiently relevant to a hypothetical negotiation, and in

conjunction with Mr. Benoit’s testimony, it provided

substantial evidence supporting the jury’s damages

verdict.

We agree with the district court that the jury verdict

was supported by sufficient evidence and tied to the facts

of this case. We therefore affirm the district court’s denial

of Samsung’s motion for judgment as a matter of law of no

damages.

F. Lump Sum

Summit cross-appeals, challenging the district court’s

determination that the jury verdict represents an amount

of a lump-sum license through the life of the patent and

compensates Summit for both past and future infringe-

ment. Summit argues that the jury’s award cannot be a

lump sum through the life of the patent because the

relevant evidence, arguments, and instructions, and the

verdict form were all limited to damages for past in-

fringement. Summit also argues that its equitable claim

for future damages is not an issue for the jury. Thus,

Summit concludes that it is entitled to recover damages

for future infringement. We disagree.

This court has not directly addressed whether a jury

can award lump-sum damages through the life of the

SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD. 27

patent. We have, however, permitted such relief. In

Telcordia Techs., Inc. v. Cisco Sys., Inc., 612 F.3d 1365,

1378 (Fed. Cir. 2010), the district court rejected the

defendant’s argument that the jury’s damages award was

necessarily a lump-sum award intended to compensate

the patentee for past and future infringement, reasoning

that the evidence at trial provided no way of knowing

what the jury actually did. Telcordia, 592 F. Supp. 2d

727, 747 n.8 (D. Del. 2009), aff’d in part, vacated in part,

612 F.3d 1365 (Fed. Cir. 2010). When the defendant

appealed the district court’s order granting the patentee

equitable relief in the form of an ongoing royalty, this

court affirmed, reasoning that the court did not abuse its

“broad discretion” in interpreting the verdict form because

the verdict form was ambiguous, neither party had pro-

posed the jury’s exact $6.5 million award, and it was

“unclear whether the jury based its award on a lump-sum,

paid-up license, running royalty, some variation or com-

bination of the two, or some other theory.” Telcordia, 612

F.3d at 1378.

Similarly, in Whitserve, LLC v. Computer Packages,

Inc., 694 F.3d 10, 35-38 (Fed. Cir. 2012), this court vacat-

ed and remanded the district court’s denial of supple-

mental damages for infringement after the verdict but

before final judgment was entered because the court had

failed to explain its reasons for denying such damages.

This court rejected the defendant’s argument that the

patentee’s supplemental damages request was properly

denied because the jury had necessarily awarded a lump-

sum license for all past and future infringement. Id. at

38. This court noted that “nothing in the record would

support” that conclusion because “the parties limited their

damages arguments to past infringement rather than

projected future infringement” and the “jury’s verdict did

not indicate that the award was meant to cover future use

of [plaintiff’s] patents[.]” Id. at 35.

28 SUMMIT 6, LLC v. SAMSUNG ELECTRONICS CO., LTD.

In this case, the district court properly denied Sum-

mit’s request for an ongoing royalty because the jury

award compensated Summit for both past and future

infringement through the life of the patent. Samsung’s

expert, Mr. Martinez, testified that a lump-sum award

was appropriate. J.A. 7089-90. He also testified regard-

ing the weight the jury should give the license agreements

introduced into evidence, all of which were lump-sum

licenses. Moreover, Summit’s expert, Mr. Benoit, admit-

ted that a lump-sum award would compensate Summit

through the life of the patent. J.A. 6452, 6479-80. When

the jury returned its verdict, it indicated on the verdict

form that the award was a lump sum by writing “lump

sum” on the verdict form. We see no basis to disturb the

district court’s determination and hold that the district

court did not abuse its discretion in denying Summit’s

request for an ongoing royalty.

III. CONCLUSION

For each of the reasons stated above, we affirm the

district court’s claim construction of “being provided to,”

affirm the infringement and invalidity verdicts, affirm the

district court’s determination regarding the admissibility

of Summit’s damages expert’s testimony, affirm the

district court’s determination regarding the damages

award, and affirm the determination of the district court

that Summit is not entitled to a running royalty.

AFFIRMED