Power-One, Inc. v. ARTERSYN TECHNOLOGIES, INC.

Citations: 556 F. Supp. 2d 591; 2008 U.S. Dist. LEXIS 30298; 2008 WL 1746634Docket: 4:05-cv-00463

Court: District Court, E.D. Texas; April 11, 2008; Federal District Court

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Defendant Artesyn Technologies, Inc. filed a Renewed Motion for Judgment as a Matter of Law (JMOL) and an Alternative Motion for New Trial regarding the invalidity of Power-One, Inc.'s patents, specifically the '125 and '999 patents. The jury had previously determined in November 2007 that Artesyn infringed certain claims of the '125 patent but did not infringe the '999 patent, and also found that Artesyn failed to demonstrate the patents' invalidity by clear and convincing evidence. In reviewing the motions, the court stated that JMOL is appropriate only if there is insufficient evidence for a reasonable jury to support its verdict. The court emphasized the need to interpret evidence favorably towards the nonmoving party and not to make credibility determinations. Under the standard for a new trial, the court may grant it based on factors such as a verdict being against the weight of the evidence or the presence of prejudicial errors during the trial. Ultimately, Artesyn's motions were denied.

A patent may be deemed obvious and thus invalid under 35 U.S.C. 103(a) if the differences between the proposed invention and prior art are such that a person of ordinary skill in the relevant field would find the invention obvious at the time it was created. The determination of obviousness is a legal question influenced by factual findings. It involves considering the perspective of a hypothetical person skilled in the art, taking into account all relevant prior art references.

The Supreme Court has established a framework for assessing obviousness, which includes analyzing: 1) the scope and content of prior art; 2) differences between the claimed invention and prior art; 3) the ordinary skill level in the art; and 4) secondary considerations that may shed light on the invention's circumstances, such as commercial success or unmet needs. In addition to these factors, courts may also consider the combined teachings of multiple patents, market demands, and the general knowledge of a skilled person in the art.

While a patent's obviousness cannot simply be established by showing that its individual components were known, combinations of familiar elements may be obvious if they yield predictable results. The analysis of obviousness should be broad and adaptable, incorporating common sense. The burden of proving obviousness rests with the challenger, who must present clear and convincing evidence. In this case, the jury found the patents in question to be valid and non-obvious, and for the challenger to succeed in their motion for judgment as a matter of law (JMOL), they must demonstrate that the evidence overwhelmingly favored their position, making the jury's conclusion unreasonable.

Artesyn contends that prior art presented during the trial demonstrates the common knowledge of using digital serial communications for programming, controlling, and monitoring power supplies, including switching DDC regulators, prior to the issuance of the '999 and '125 patents. Through expert testimony from Mr. Neal Stewart, Artesyn asserts that the prior art is extensive, the distinctions between the claimed inventions and the prior art are minimal, and the ordinary skill level in the field is high. Because of this broad prior art and minor differences, Artesyn claims the '999 and '125 patents are obvious and therefore invalid. 

Specific prior art references cited include:

1. **SCPI Protocol Specification**: Artesyn argues this document outlines standard digital commands for programming, controlling, and monitoring various devices, including power supplies, detailing commands for turning power supplies on/off, setting output voltage, and monitoring voltage and current.

2. **Linear Technology Design Note**: This reference allegedly demonstrates the use of digital serial communications specifically for programming and controlling switching DC-DC regulators via the SMBus.

3. **Melcher G Data Sheet**: Artesyn claims this data sheet shows a digital serial bus used with a small switching DC-DC regulator that can receive commands and monitor operational data.

4. **Summit "NEBS Complaint Board Level Power System" article**: This article reportedly describes a DC-DC regulator that receives digital programming and control information over a serial bus, which also facilitates monitoring of the regulators' operations.

5. **U.S. Patent No. 6,396,169 (the '169 patent)**: Artesyn argues this patent reveals a power control system that integrates a controller, multiple switching DC-DC regulators, and a digital communications bus for programming and monitoring.

Artesyn emphasizes that the teachings from these references suggest that the use of digital serial commands for power supply management is obvious, thereby invalidating the patents in question.

U.S. Patent No. 6,563,294 (the '294 patent), referred to as the Duffy patent, describes a system where a central controller communicates programming and control information to multiple DC-DC power converters via a digital serial bus. Artesyn presents the Teradyne Prototype as prior art developed by Power-One's external consultant, which similarly utilizes digital serial communications in a power control system with a central controller and DC-DC regulators. The Court found substantial evidence supporting the jury's validity findings and determined that Artesyn did not prove obviousness by clear and convincing evidence. 

Both parties presented expert testimony regarding the obviousness of Power-One's invention. Artesyn's expert asserted that the invention was inevitable due to the prior art trends, while Power-One's expert contended that a skilled person would not find the inventions obvious, citing significant differences between the prior art and the patented technology. Key differences highlighted included the SCPI Protocol Specification, which Artesyn's expert acknowledged was merely a protocol language, not directly applicable to the board-mounted power supplies at issue. Additionally, he admitted a lack of experience in designing embedded power supplies that communicated using SCPI. 

Testimony also indicated that the SCPI's purpose was to streamline Automatic Test Equipment (ATE) program development, not for board-level power management as claimed in the patents. Regarding the Linear Technology Design Note, it was asserted that it did not disclose the smart POL invention, as it utilized simple on/off controls rather than a serial bus for communication and lacked monitoring capabilities or addressing lines necessary for connecting multiple chips to a common bus.

Dr. Ehsani's testimony highlighted several key distinctions between the Melcher G Data Sheet and the asserted patents, noting that Melcher G was a brick not designed for load proximity or as a Point of Load (POL). It lacked the necessary addressability for integration with multiple devices, could not manage output control or timing, and featured only enable lines instead of serial data buses. The DC-DC regulators in the Summit Reference were similarly limited, receiving no programming from a data bus and functioning as bricks rather than POLs, which were essential for the hot-swap application discussed. Ehsani emphasized that the Summit's serial data bus was irrelevant to the invention, as it did not facilitate communication with power supplies. Furthermore, it was noted that the patent was granted over prior art that encompassed significant elements of the Summit's diagram, with the Summit Reference dated later than Power-One's conception of the patents. 

Regarding the '169 Voegeli Patent, Ehsani stated it did not present a distributed board-level power architecture or disclose smart POLs but rather brick power supplies, with any sequencing managed by the power controller. Similarly, for the '294 Duffy Patent, he indicated that the power system controller was not equivalent to the claimed controller since it was embedded within the power supply. The Teradyne Prototype exhibited considerable differences in size, structure, and application compared to the asserted patents, being a large AC-DC system versus Power-One's smaller design. Artesyn's expert did not claim Teradyne invalidated Power-One's patents, and visual comparisons between Teradyne and Power-One's products underscored significant functional disparities. Lastly, while Artesyn attempted to invalidate the patents based on the SCPI protocol, their expert admitted that they had never created a POL capable of such communication.

Mr. Stewart's testimony indicated that he modified the teaching of the Summit reference to conclude that it disclosed a Prior Art of a POL. He highlighted that Summit described an isolated product, while a POL's application is non-isolated. The Court found significant differences between the prior art references and the patented invention, supporting the jury's verdict. Disputes arose regarding the relevance of certain prior art references to the obviousness determination, including questions about the publication dates of the Summit Reference and the Linear Technology Design Note, as well as whether witnesses argued that certain references invalidated the patents. The Court noted that even if all references cited by Artesyn as invalidating the patent were credited, the total of seven references constituted a limited scope of prior art. This limited scope, combined with significant differences from the asserted patents, allowed the jury to credit testimony from Dr. Ehsani and other Power-One witnesses that the prior art would not have made the inventions obvious to someone skilled in the art.

The obviousness case presented by Artesyn faced additional challenges, as it was unclear how the prior art would collectively render the patents obvious. Mr. Stewart's argument that the inventions were inevitable due to technological advancements was seen as overly simplistic and lacking coherence. Although KSR Int’l does not require evidence of motivation to combine prior art, having an expert present a logical explanation remains beneficial. Stewart's claims that multiple complex steps could turn the prior art into the patented inventions were at odds with the notion of obviousness, as arriving at an invention through hindsight involving complex steps contradicts the assertion of its obviousness at the time. He did not provide sufficient rationale for why someone skilled in the art would have deemed the steps he suggested as obvious.

Power-One presented compelling evidence at trial demonstrating that Artesyn did not consider Power-One's inventions to be obvious until recently. Artesyn promoted its DPL20C product as a significant advancement in technology, capable of functions previously unachievable without specialized silicon. This promotion indicated that the patents in question were not obvious to a person of ordinary skill in the field. Additionally, Power-One highlighted industry praise for its product, including direct commendation from Artesyn, which acknowledged the features of Power-One's patented technology as "pretty good stuff." The testimony linked this praise directly to the patented invention, fulfilling the necessary connection to assess nonobviousness.

Artesyn's interest in Power-One's technology was evident when it sought licensing discussions shortly after the product announcement, contradicting its current claims against Power-One's commercial success. Testimony from an Artesyn employee, who had attended meetings where Power-One showcased its innovations, expressed admiration for Power-One's engineering achievements, describing the work as sophisticated.

Furthermore, Power-One produced evidence of Artesyn's copying of its invention, a relevant factor in evaluating obviousness. Testimony indicated that Artesyn was aware of Power-One's concepts during the development of the DPL20C, bolstering Power-One's argument against the obviousness of its patents. Overall, significant evidence suggested that both Artesyn and the broader industry recognized Power-One's inventions as notable advancements, supporting the conclusion that the patents were not obvious in light of prior art.

Artesyn's claims of non-copying were insufficient to negate the evidence presented by Power-One, which a reasonable jury could find credible in determining that Artesyn's product infringed Power-One's patents and that those patents were valid. The trial record indicated that industry praise and secondary considerations showed Power-One's invention was not obvious. The prior art was limited to seven references, with significant differences noted between the claimed invention and this prior art. Consequently, the Court concluded that Artesyn did not provide clear and convincing evidence to demonstrate that Power-One's invention would have been obvious to someone skilled in the art based on the presented prior art. In evaluating Artesyn's motions for judgment as a matter of law (JMOL) and for a new trial, the Court emphasized that it does not make credibility determinations and must interpret evidence in the light most favorable to the verdict. Artesyn also failed to establish that the evidence favored a finding of obviousness to such an extent that reasonable jurors could not reach a different conclusion. The Court found no grounds for a new trial. Therefore, Artesyn Technologies, Inc.'s motions regarding the invalidity of the '125 and '999 Patents were denied. Additionally, Power-One noted that Artesyn did not prove the Linear Technology Data Sheet was prior art due to a lack of evidence regarding its publication date. Artesyn's expert acknowledged that the Summit reference was prior art but could not convincingly argue why it would have been obvious to adapt it into the patented invention. The Court also disagreed with Power-One's assertion that the Summit figures were cumulative to prior art considered by the PTO, which deemed the patents non-obvious at the time.

Power-One contends that Artesyn's expert acknowledged that the '169 Patent discourages the use of a communication bus in favor of dedicated lines. The Court affirms that in infringement cases, products must be compared to patent claims, but cites the Supreme Court's KSR Int'l decision, advocating for a flexible approach to assessing obviousness. Visual distinctions between Teradyne and Power-One's inventions are deemed significant in this analysis. Mr. Stewart indicated that cost constraints prevented his company from developing products with SCPI digital interfaces for power supplies. The Court accepts Summit as prior art for this motion, despite concerns regarding the timing of its conception and reduction to practice. Power-One argues that prior art figures in the patent reveal key features of Summit, which the PTO considered when issuing the patent. Mr. Stewart trivialized the technical differences between the prior art and the patented inventions by referring to them as "peanuts," and his simplistic responses did not contribute meaningfully to the experts' discussions on obviousness. The jury could favor Dr. Ehsani's comprehensive testimony over Mr. Stewart's, particularly given Mr. Stewart's potential bias, as he is linked to a company acquired by Emerson Electric.