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SRI Int'l, Inc. v. Cisco Sys.

United States Court of Appeals for the Federal Circuit

March 20, 2019, Decided

2017-2223

Opinion

 [*1372]  Stoll, Circuit Judge.

This is an appeal from a final judgment in a patent case. Cisco Systems, Inc. ("Cisco") appeals the district court's (1) denial of Cisco's motion for summary judgment of patent ineligibility under § 101, (2) construction of the claim term "network traffic data," (3) grant of summary judgment of no anticipation, and (4) denial of judgment as a matter of law of no willful infringement. Cisco also appeals the district court's [**2]  grant of enhanced damages, attorneys' fees, and ongoing royalties.

We affirm the district court's denial of summary judgment of ineligibility, adopt its construction of "network traffic data," and affirm its summary judgment of no anticipation. We vacate and remand the district court's denial of judgment as a matter of law of no willful infringement, and therefore vacate the district court's enhancement of damages. We also vacate the district court's award of attorneys' fees and remand for recalculation. Finally, we affirm the district court's award of ongoing royalties on post-verdict sales of products that were actually found to infringe or are not colorably different. Accordingly, we affirm-in-part, vacate-in-part, and remand for further proceedings consistent with this opinion.

Background

While the interconnectivity of computer networks facilitates access for authorized users, it also increases a network's susceptibility to attacks from hackers, malware, and other security threats. Some of these security threats can only be detected with information from multiple sources. For instance, a hacker may try logging in to several computers or monitors in a network. The number of login [**3]  attempts for each computer may be below the threshold to trigger an alert, making it difficult to detect such an attack by looking at only a single monitor location in the network. In an attempt to solve this problem, SRI developed the inventions claimed in U.S. Patent Nos. 6,484,203 and 6,711,615. The '615 patent (titled "Network Surveillance") is a continuation of the '203 patent (titled "Hierarchical Event Monitoring and Analysis").

SRI had performed considerable research and development on network intrusion detection prior to filing the patents-in-suit. In fact, SRI's Event Monitoring Enabling Responses to Anomalous Live Disturbances ("EMERALD") project had attracted considerable attention in this field. The Department of Defense's Defense Advanced Research Projects Agency, which helped fund EMERALD, called it a "gem in the world of cyber defense" and "a quantum leap improvement over" previous technology. J.A. 1272-73 at 272:16-17, 273:7-9. In October 1997, SRI presented a paper entitled "EMERALD: Event Monitoring Enabling Responses to Anomalous Live Disturbances" ("EMERALD 1997") at the 20th National Information Systems Security Conference.

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918 F.3d 1368 *; 2019 U.S. App. LEXIS 8249 **

SRI INTERNATIONAL, INC., Plaintiff-Appellee v. CISCO SYSTEMS, INC., Defendant-Appellant

Subsequent History: Rehearing granted by, in part, Rehearing denied by, in part, En banc, Opinion withdrawn by, Substituted opinion at SRI Int'l, Inc. v. Cisco Sys., 2019 U.S. App. LEXIS 20679 (Fed. Cir., Mar. 20, 2019)

Prior History:  [**1] Appeal from the United States District Court for the District of Delaware in No. 1:13-cv-01534-SLR-SRF, Judge Sue L. Robinson.

SRI Int'l, Inc. v. Cisco Sys., 254 F. Supp. 3d 680, 2017 U.S. Dist. LEXIS 83832 (D. Del., May 25, 2017)SRI Int'l, Inc. v. Cisco Sys., 179 F. Supp. 3d 339, 2016 U.S. Dist. LEXIS 48092 (D. Del., Apr. 11, 2016)SRI Int'l, Inc. v. Dell Inc., 2015 U.S. Dist. LEXIS 63022 (D. Del., May 14, 2015)

Disposition: AFFIRMED-IN-PART, VACATED-IN-PART, AND REMANDED.

CORE TERMS

network, district court, packets, monitors, infringement, willful, traffic, summary judgment, detecting, patent, abstract idea, technology, specification, direct examination, anticipation, computer network, attorney's fees, recite, suspicious activity, invention, royalty, vacate, products and services, statistics, ongoing, enhanced damage, reexamination, generating, measures, asserted claim

Civil Procedure, Appeals, Summary Judgment Review, Appealability, Patent Law, Jurisdiction & Review, Standards of Review, De Novo Review, Subject Matter, Infringement Actions, Claim Interpretation, Prosecution History Estoppel, Judgments, Summary Judgment, Entitlement as Matter of Law, Appeals, Anticipation & Novelty, Elements, Motions for Summary Judgment, Notice Requirement, Trials, Judgment as Matter of Law, Burdens of Proof, Remedies, Damages, Increased Damages, Business & Corporate Compliance, Patent Law, Infringement Actions, Collateral Assessments, Attorney Fees, Abuse of Discretion, Patentholder Losses, Reasonable Royalties