[00:00:00] Speaker 00:
Our final case for argument is 26-1196, Schmeisser v. A.C. Unity. Mr. Hartley, please proceed when you're ready.

[00:00:12] Speaker 04:
Good morning, may it please the Court. Mike Hartley on behalf of the appellant Schmeisser, G.M.B.H. The District Court's dissolution of the stipulated preliminary injunction was premised on a legally erroneous finding of indefiniteness in its Markman order.

[00:00:27] Speaker 04:
There's ample basis in the intrinsic evidence. claim language itself, the specification, the figures, and the prosecution history for a procedure to conclude with reasonable certainty the scope of the claims.

[00:00:41] Speaker 04:
Appendix page 49 from the district court's order on reconsideration shows one of the clearest examples of the court's error. There, the district court stated unequivocally that the distant terms are, quote, of course measurable in a constructed magazine.

[00:00:56] Speaker 04:
If the terms are, of course, measurable in They're reasonably certain. We know where. We know how.

[00:01:00] Speaker 00:
You're sort of going to the merits of whether or not it's definite or not. I mean, isn't your first point that he applied the wrong law?

[00:01:08] Speaker 04:
Yes.

[00:01:08] Speaker 00:
The first point is that— He's blended all of 112 as though it was a single inquiry. It's like enablement, red description, indefiniteness. Oh, you're out.

[00:01:16] Speaker 04:
Absolutely correct, Your Honor.

[00:01:19] Speaker 04:
The issue that the district court focused on was this issue of clearance values. Clearance values are not a claim term. What they looked at was just the plain language of claim 112A.

[00:01:30] Speaker 00:
You're in the weeds. I'm sorry? You're in the weeds. Get out of the weeds. Yes. Come back to the fairway. So where, in his opinion, did he misstate the law? Show me.

[00:01:40] Speaker 04:
Certainly, Your Honor.

[00:01:44] Speaker 04:
Looking at the Markman order, which is appendix pages 12 to 14— This was under the court's stated quote, standard for adjudication of indefiniteness. There the court states that it requires the patentee to be specific enough, I'm sorry, requires the patent to be specific enough for a person of ordinary skill in the art to build and employ the claimed invention. Directly citing section 112A. This is a definiteness case. We're talking at 112B.

[00:02:10] Speaker 00:
As this court made clear in So build and employ, you think parallels enablement, not indefiniteness.

[00:02:17] Speaker 04:
Yes, but The court also cited at page 19 of the appendix in the Markman order that the definiteness standard will be satisfied if the POSITA can, quote, build and use. That's 112A.

[00:02:27] Speaker 02:
Do you think he got confused on that? And where did that come from?

[00:02:33] Speaker 04:
It's because of all of the testimony that was focused on this concept of clearance values. The district court and AC Unity below presented clearance values as whether you can measure Measurement and design is not the same.

[00:02:50] Speaker 02:
The clearance values made it so that you couldn't know exactly what the measurement would be before you build it. Exactly. Something like that. Before you build it. I was just trying to figure out what the source of law was, if anything, for this confusion. And you might not know what it is. It doesn't really matter. It seems pretty far astray of what our standard is. So I was trying to figure out where it came from.

[00:03:14] Speaker 04:
Again, it came solely from the court focusing. It called this issue of clearance values a buzzsaw that destroyed the definiteness of the claim.

[00:03:24] Speaker 03:
It may not matter, but I do have the same question, how the district court was led astray in your motion for reconsideration at 2101 and 2102. It seems like you blame it on the defendants and their experts' testimony. Is that the source of this build and use and clearances focus?

[00:03:42] Speaker 04:
Yes, because if you look at Mr. Zeller's opening report on claim construction, there's no discussion of clearance values. It's simply looking at distance A, for example. The claim language is clear. That's the distance from the front wall, the interior surface of the front wall to the interior surface of the back wall.

[00:03:58] Speaker 02:
So as long as they're not mushed together, that's the distance?

[00:04:01] Speaker 04:
Exactly. At the end of the day, this is a box. We have a front wall, a back wall, two side walls, and it encloses an interior space.

[00:04:08] Speaker 04:
Those walls are separated by a distance. Claim 1 simply identifies the front wall to the back wall as distance A. Looking at Mr. Sellers' opening report below on claim construction, no mention of clearance values, just says, I can read front wall to back wall and I know what it means. A person of ordinary skill in the art would know what it means. Same for distance B, side wall to side wall in region 1. Distance C, side wall to side wall in region 2.

[00:04:33] Speaker 04:
There's nothing indefinite about get a ruler and measure from the front wall to the back wall.

[00:04:40] Speaker 04:
So it's, again, looking at the court's Markman order, it referenced clearance values 30 times. Clearance values is not a claim term. We simply have to have a distance. Looking at the post-hearing briefing, the court again said, show me how you're going to build one of these. What are the steps you'll take to design it? How will you determine the cartridge length? How will you determine the clearance value? How will you put them together? How will you show your work? How are you going to design it? Design is not the inquiry under 112B. Yes, under 112B.

[00:05:15] Speaker 03:
If I agree with you that the claims were not proven indefinite under the correct legal standard, it seems I have to exercise pendant appellate jurisdiction to order the district court to vacate its summary judgment ruling, which, strictly speaking, is not in front of us, right? This is just an appeal from a dissolution of a P.I.,

[00:05:37] Speaker 04:
It is an appeal of the dissolution of the preliminary injunction under 1292A1 and to this court specifically under C1. But if we look at this court's decision in Cross Medical, that wasn't a question of pendant jurisdiction. The court simply said that when the issues to the reason for entry or denial of the injunction are inseparably connected to the summary judgment issues, this court has to rule on them. That wasn't done in the context of pendant jurisdiction. Dependent jurisdiction, however, is appropriate here because these issues are undeniably intertwined.

[00:06:08] Speaker 03:
And what about the preliminary injunction itself? Just assuming that I agreed with you on indefiniteness, time has moved on. Entering a PI, there's a lot of things that you would have to show. I know there was a stipulation way back when.

[00:06:26] Speaker 03:
Are you asking us to order the district court to reinstate the preliminary injunction, or would we just remand for further proceedings?

[00:06:33] Speaker 04:
We are asking that the injunction be reinstated, the reason being that the only issue that's been brought up is this issue of indefiniteness. That was a clear legal error, and the district court's dissolution of the injunction on that basis was a clear error. That was an abuse of discretion.

[00:06:50] Speaker 04:
As Your Honor noted, this was a stipulated injunction. There was no findings on weighing of the hardships, no findings specifically on irreparable harm. But to that point, as we've pointed out in the briefing, and AC Unity has not disputed here, there's now ACU magazines on the market that are being sold at an 80% discount against Schweitzer's historical pricing. As the district court found in its order enjoining ACU's prior distributor, RTG, there's evidence and a conclusive finding of – Prejudice based on price erosion.

[00:07:29] Speaker 03:
Stipulation to the preliminary injunction in January 2024 did expressly say it was without prejudice to any future challenge on the merits allowed by law. So even if we did as you wanted, they'd have the right to move to vacate the preliminary injunction if they think they have a basis for that. Is that right?

[00:07:50] Speaker 04:
If it's remanded with the injunction in place, certainly they would have the opportunity to file a motion to ask the court to do whatever they want to ask the court to do.

[00:08:01] Speaker 04:
If there are no further questions, I reserve my remaining time for rebuttal.

[00:08:05] Speaker 00:
Very good. Ms. Vance.

[00:08:19] Speaker 01:
Good morning, Your Honors. May it please the Court.

[00:08:23] Speaker 01:
Catherine Vance appearing on behalf of a defendant appellee, AC Unity.

[00:08:27] Speaker 01:
Subject to your honor's questions, I plan to address three major points this morning.

[00:08:33] Speaker 01:
Jurisdiction, the court's correct application of the Nautilus standard, and the court's correct determination that the distance terms are indefinite.

[00:08:47] Speaker 01:
So first, the preliminary injunction analysis does not require this court to reach the merits of the indefinite claim.

[00:08:55] Speaker 01:
only to determine whether the district court abused its discretion in concluding that Schmeisser could no longer demonstrate a likelihood of success on the merits.

[00:09:04] Speaker 02:
The district court... Respond to cases like Hillefax and Integris.

[00:09:14] Speaker 01:
I would say that this court has, it's in this court's discretion of whether to exercise pendant jurisdiction over the Markman order.

[00:09:23] Speaker 01:
And it's our position that doing so would be premature and possibly cause piecemeal litigation where we would be back here again because there are other invalidity and unenforceability claims pending.

[00:09:39] Speaker 02:
Would you want to talk about indefiniteness? Sure.

[00:09:45] Speaker 02:
How can you contend that the standard that was applied is correct under our law?

[00:09:52] Speaker 01:
The district court did apply the correct Nautilus standard. He carefully considered all of the arguments, the expert testimony. He had a carefully reasoned opinion.

[00:10:01] Speaker 02:
What about the language at page A13? In page A13?

[00:10:06] Speaker 01:
Yeah, JA13.

[00:10:12] Speaker 02:
that you have to be able to, indefiniteness demands that a patent be specific enough that a person of ordinary scale in the art be able to build the invention. Do you have any cases that frame indefiniteness in that way?

[00:10:28] Speaker 01:
So I think what's happening here is during the testimony at the Markman hearing, everybody agreed that

[00:10:39] Speaker 02:
There was a required... I mean, your answer could be, no, I don't have a case that frames it in this way, but maybe this is not exactly what the court meant. I mean, so what is your answer? If you could give me a yes or no on that question before you go into your explanation, that would be helpful.

[00:10:53] Speaker 01:
Can I turn to the page and read?

[00:10:55] Speaker 02:
Yeah, sure.

[00:11:01] UNKNOWN:
13.

[00:11:02] Speaker 02:
Yep, it's day 13, and I can read to it. It says, indefinite demands that a patent be specific enough for a person of ordinary skill in the art to be able to build and employ the claimed invention. And then it cites the entire passage of 35 U.S.C. 112A, where, you know, it's our reading that probably there was too much read into his requirement of indefiniteness. He had blended indefiniteness with written description and enablement.

[00:11:30] Speaker 01:
Yes, Your Honor. I believe if you keep reading, though, what we assert is that in this court's Markman order, he included 112A language to show the scope of 112 in general. And then throughout his order, he narrowed to 112B, and he repeatedly cited the Nautilus standard.

[00:11:51] Speaker 02:
Do you think it's correct that for a claim to be definite, it has to teach someone how to build the invention?

[00:12:00] Speaker 01:
No, Your Honor.

[00:12:05] Speaker 01:
Does that answer your question? Yes.

[00:12:08] Speaker 01:
Since we're on the topic of the clearance values, during the Markman hearing and in the prior deposition testimony, everybody agreed that these distances, A, B, C, would have some sort of clearance baked into them. It's something that would be required.

[00:12:26] Speaker 01:
And during the Markman testimony hearing, Schmeiser's expert was questioned on where that information would come from. And for the first time at the Markman hearing, he said conclusively those would be in the SAMI or the MIL-SPACs.

[00:12:44] Speaker 01:
And we were given an opportunity to test that theory to show what a POSITA would actually know.

[00:12:59] Speaker 01:
And regarding the post-hearing briefing exercise, as I mentioned, this was prompted by Schweizer's own expert, Mr. Zeller.

[00:13:07] Speaker 01:
And we assert that it is proof that the court was evaluating whether or not a post-ceda could build an actual magazine, but that misses the whole point of it.

[00:13:18] Speaker 01:
Their expert's identification of the Samian mill specs as the source of clearance for the first time conclusively cemented the patent's missing information on that.

[00:13:39] Speaker 01:
And the post-hearing briefing was purely an exercise to see if it was in fact true that that information could be supplied. Can the missing information of the patent be supplied by the standards, and would a PCETA know that?

[00:13:51] Speaker 01:
As the briefing and testimony show, the answer to both of those are no.

[00:13:58] Speaker 01:
And second, I know that we've just discussed this. The district court did make reference to the Section 112A in its Markman order just as background. And there are two points that I want to make on this. And as I mentioned before, the first one of those is this is not a novel way of drafting an order or a brief. The court was providing the scope and slowly sharpening the lens through which it conducted its evaluation.

[00:14:23] Speaker 00:
Can you just explain to me why this claim is in depth?

[00:14:30] Speaker 00:
What claim term in particular is indefinite?

[00:14:35] Speaker 02:
We assert that the district... It's like a first distance A and a first distance B and a second distance B and a third distance C, right? Okay.

[00:14:51] Speaker 01:
Yes, Your Honor.

[00:14:52] Speaker 00:
The distances are the first distance A, second distance B, third distance C, and offset B. And is your argument that it's indefinite because a skilled artisan would not know from what point to what point to measure to ascertain the distance? What exactly is your argument? So it's twofold, Your Honor.

[00:15:13] Speaker 01:
So yes, these distances can be measured on a finished magazine.

[00:15:18] Speaker 01:
We don't necessarily dispute that. But the definiteness inquiry is not about whether you can put a ruler on a completed product after the fact. It is about whether a person of ordinary skill in the art reading the patent knows before they build anything what the claim boundaries are. And that is what Nautilus requires.

[00:15:38] Speaker 02:
What if the claim boundary is just broad? There has to be a distance.

[00:15:50] Speaker 01:
Just requiring a distance is not sufficient.

[00:15:54] Speaker 02:
Why?

[00:15:55] Speaker 01:
It does not give you the bounds.

[00:15:57] Speaker 02:
You can't... You know it's a distance from point A to point B, and it's a distance in a particular environment that has many more limitations.

[00:16:14] Speaker 01:
Consider this analogy.

[00:16:17] Speaker 01:
Appellant hands you a builder or hands a builder a blueprint for a house.

[00:16:23] Speaker 01:
And it identifies that the master bedroom needs to be a distance away from the kitchen.

[00:16:31] Speaker 01:
But it identifies no starting points, no end points, or where at what level within that house.

[00:16:36] Speaker 02:
Doesn't that just give the builder a lot of discretion?

[00:16:42] Speaker 01:
It could.

[00:16:45] Speaker 01:
But how is the builder to know whether or not they are building it to the specification or the requirement?

[00:16:53] Speaker 02:
Maybe there's other limitations that help the builder know that. For example, there might be a limitation that one dimension compared to another dimension has to result in a third dimension, for example.

[00:17:05] Speaker 01:
Yes, and that is similar to the situation here where – What the claims describe are these distance terms, but in relationship to one another, as you will.

[00:17:19] Speaker 01:
But that's not enough. As Mr. Hartley mentioned, the patent describes a box.

[00:17:26] Speaker 01:
Describing a box is not a sufficient disclosure. Describing a box is not sufficient for somebody who's building a magazine to know whether or not they fall within the scope of the 045 patent.

[00:17:43] Speaker 03:
I know you aren't even sure that we have jurisdiction here, at least not in full, but if I were just hypothetically persuaded that these claims have not been shown to be indefinite, what would you have me do given the jurisdictional situation and the status of this case?

[00:18:06] Speaker 01:
This court can decide that the terms are definite.

[00:18:12] Speaker 01:
Is that the answer to your question? I guess so.

[00:18:14] Speaker 03:
I didn't know if your argument went so far as even if I think they're definite, I should just not say it. But that's not your position.

[00:18:24] Speaker 01:
Did I answer your question? I think so. Thank you. Okay. I want to kind of back up to this just measuring it, just measure the product.

[00:18:38] Speaker 01:
Appellant is saying that the claims are clear because you can measure a physical product, that the distance terms are definite because a competitor can just put a ruler on a finished magazine and obtain a number.

[00:18:51] Speaker 01:
But what physical product are they referring to? Are they referring to their product that we must assume practices the patent because they say so? Do you have to go buy a Schmeisser magazine and cut it open and measure it and And does that help you understand? An even more concerning option, and one that they mention on page 20 of their reply brief, the district court, AC Unity, and Schmeiser all agree that the necessary measurements for the distance terms are readily taken after an accused article has been made.

[00:19:23] Speaker 01:
Is this just any competitor product? This framing is a problem.

[00:19:28] Speaker 01:
And Schmeisser is conflating the question of whether distances are physically measurable on a completed product with a separate legal question of whether the claims provide objective boundaries for a person of ordinary skill in the art reading the patent. And these are different inquiries.

[00:19:47] Speaker 01:
To be clear, though, we do not agree that measuring an accused device will tell you anything about the scope of the 045 patent.

[00:19:54] Speaker 01:
And these arguments get the law exactly wrong.

[00:19:59] Speaker 01:
A patent is a blueprint. It's not a finished physical product. Under Nautilus, a competitor is entitled, a posita is entitled to read that blueprint and know with reasonable certainty where the claim boundaries lie before it ever commits resources to manufacturing. To have it any other way would reduce the public notice function.

[00:20:20] Speaker 01:
And this is also precisely the zone of uncertainty against which the definiteness requirement guards.

[00:20:28] Speaker 01:
Further, extrinsic evidence of a completed invention cannot retroactively fix an indefinite claim.

[00:20:36] Speaker 01:
Under Schmeiser's approach, a competitor would be required to invest time, money, and resources engineering a magazine only to discover after the fact that they have crossed some invisible, uncharted line. And this is not public notice. It's a trap.

[00:20:57] Speaker 01:
This court is clear.

[00:20:59] Speaker 01:
the boundary of a patent claim must be fixed and objective.

[00:21:03] Speaker 01:
And again, Nautilus provides that a patent is indefinite if the claims read in light of the specification and prosecution history fail to inform a person of ordinary skill in the art with reasonable certainty of the scope of the invention. Noticeably absent from that standard is a physical product.

[00:21:22] Speaker 01:
And I would like to touch on the expert testimony below.

[00:21:27] Speaker 01:
The most powerful evidence of indefiniteness came from appellant's own witness, Mr. Zeller.

[00:21:34] Speaker 01:
And the district court did adopt Schmeiser's own proposed POSITA definition, which was a design engineer who was familiar with the design and operation of a magazine for use in a firearm.

[00:21:47] Speaker 01:
Despite this, Mr. Zeller testified that determining the clearance values necessary to calculate the distance terms requires 18 to 24 months of specialized experience.

[00:21:58] Speaker 01:
which far exceeded the adopted POSITA definition.

[00:22:03] Speaker 01:
But now on appeal, Schmeiser claims that this testimony concerned only general firearm safety knowledge, not magazine design.

[00:22:11] Speaker 01:
But that is not what the transcript shows. the district court questioned Mr. Zeller directly about where Aposita would find these clearance information for purposes of magazine construction, and Mr. Zeller answered 18 to 24 months of industry experience. He also provided some clearance values based on application, which he then changed in the post-hearing briefing.

[00:22:35] Speaker 01:
The district court credited his testimony, and its factual finding on this point should be reviewed for clear error.

[00:22:43] Speaker 01:
When a patentee's own expert concedes that the claims cannot be understood with reasonable certainty by the patent's intended audience, indefiniteness is properly found.

[00:22:57] Speaker 01:
Is there anything you guys... Do Your Honors have any questions?

[00:23:01] Speaker 00:
We're good. Thank you, Ms. Vance. Thank you. Mr. Hartley.

[00:23:11] Speaker 04:
Very briefly, Your Honor, I think my colleague's argument has simply confirmed that clearance values are not a claim term. Clearance values are not what we're here to discuss in the context of indefiniteness.

[00:23:25] Speaker 04:
Just simply as a last point, Dr. Spack, their expert, admitted in her testimony at the Markman hearing, clearance is a design choice. It's not a claim element.

[00:23:34] Speaker 04:
Unless Your Honor has any further questions.

[00:23:38] Speaker 04:
Thank you.

[00:23:39] Speaker 00:
I thank both counsel. This case is taken under submission.