$200 Million Years of Bad Luck

Mirror Worlds, LLC v. Apple, Inc.

Surprisingly, the Federal Circuit’s split decision in Mirror Worlds, LLC v. Apple, Inc. did not issue on Friday the 13th. Still, the patent holder must have wondered what happened to its lucky rabbit foot after the trial and appellate courts both found no infringement as a matter of law, even though the jury returned a verdict for $208 million. Both the district court and federal court based their decisions on the fact that the patent holder had failed to present a “legally sufficient evidentiary basis” from which a reasonable jury could find direct or induced infringement. No doubt the courts’ rulings left accused-infringer Apple, Inc. knocking wood—and patent holder Mirror Worlds just knocking its head.

The patents at issue in Mirror Worlds claim a method for chronologically organizing computer files and identifying them with a time stamp instead of a file name. Mirror Worlds alleged that certain features in Apple’s operating systems—including the popular “Cover Flow” feature in iTunes—infringed its patents. After a trial where an Apple executive actually did a demonstration in the courtroom, the jury returned its verdict in Mirror World’s favor. But the trial court granted Apple’s motion for judgment as a matter of law. The district court said:

Mirror Worlds simply failed to present sufficient evidence from which a reasonable jury could find that Apple, or anyone else, practiced each and every step of the claimed methods [in the accused products]. While it is important to persuade a jury, it is imperative to present a “legally sufficient evidentiary basis” to support that persuasion.   

Mirror Worlds appealed.

On appeal the panel’s majority agreed with the district court. Mirror Worlds claimed that it had presented sufficient evidence of the direct infringement by third parties needed to establish its inducement claim. Mirror World cited Apple’s user manuals and software reviews of Apple’s operating systems to prove induced infringement and pointed to a demonstration of the system performed by an Apple executive to show direct infringement. But the panel’s majority said that evidence failed. The manuals were insufficient because they taught each step of the claimed method in isolation rather than all of the steps together. The software reviews also failed to present the claimed steps together in an infringing manner. The majority found similar problems with Mirror World’s direct infringement claim. The court said that although Apple’s computers could be used in an infringing manner, Mirror World was required to produce evidence of actual use of each claim limitation. The court also rejected Mirror World’s claims that a sole act performed as a courtroom demonstration could prove direct infringement.

Mirror Worlds teaches that sometimes it pays to be a little superstitious. Just as not walking under ladders prevents anything on the top of it from falling on you, as well as preventing any evocation of the gallows, tried and true trial traditions, like lucky socks and list-making, ensure that discovery produces the evidence needed to support the stated claim—and that the needed evidence gets introduced at trial. Skeptic or not, why step on a crack when breaking a mirror might just end up costing $200 million dollars?

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