Massachusetts U.S. District Court William Young has been teaching evidence law for as long as I can recall, even as far back as his pre-federal court days, when he was on the Superior Court bench (Judge Young was appointed to the federal bench in 1985, and had been a Massachusetts Superior Court Judge from 1978 to 1985).
So it comes as a surprise to many when Judge Young admits he made an evidence-related error during a recent patent trial, and that as a result he will order a new trial.
The case is NewRiver, Inc. v. Newkirk Products, Inc. In brief, NewRiver’s patent claimed as an invention a computer-assisted method for manipulating securities information in the SEC EDGAR database to extract only certain information, such as mutual fund prospecti. After trial the jury held some claims to have been infringed, and others to be invalid as obvious. The issue that has attracted attention is contained in Judge Young’s decision addressing the usual tsunami of post-trial motions for judgment notwithstanding the verdict.
The problem arose in connection with NewKirk’s challenge to the validity of NewRiver’s patent. On this issue Newkirk’s expert testified as follows:
Q: Dr. Szymanski, please read claim 9.
This is the independent claim. It states: A system for providing access to mutual fund compliance information comprising: An obtainment subsystem for acquiring securities information from one or more database sources and for extracting compliance information from at least two documents each comprising compliance information for a particular mutual fund. And the second restriction reads: An accessing subsystem for providing access to extracted compliance information for at least two mutual funds offered to investors by different fund issuers of a computer communication link.
Q: Do you have an opinion as to the validity of that claim?
A: Yes, I do.
Q: And what is your opinion?
A: My opinion that it would be obvious for the person of ordinary skill in the art, this invention would be obvious to the person of ordinary skill in the art.
However, the expert gave no basis for this opinion – he didn’t reference the “prior art” that would support that opinion, and his testimony was “general and conclusory.”
Now the rub. The Federal Rules of Evidence permit an expert to state his or her conclusion, as the expert did in this example. Rule 704 and 705 state:
Rule 704… testimony in the form of an opinion or inference otherwise admissible is not objectionable because it embraces an ultimate issue to be decided by the trier of fact.
Rule 705… The expert may testify in terms of opinion or inference and give reasons therefor without first testifying to the underlying facts or data, unless the court requires otherwise. The expert may in any event be required to disclose the underlying facts or data on cross-examination.
And, what’s worse, NewRiver didn’t object to this form of testimony. As a “teacher of evidence” (as Judge Young describes himself in the decision), that should be enough. However, in the context of a patent case, it was not. As Judge Young observed, “Federal Circuit case law renders legally inadequate the opinions of qualified experts on the ultimate issues of anticipation, obviousness, and doctrine of equivalents unless the bases therefor are spelled out on the record.”
Even worse (for defendant NewKirk), NewRiver’s failure to object to this “fatally flawed” testimony (or the “palpably wrong” jury charge premised on it) as the basis for an invalidity challenge (except post-verdict) wasn’t enough to constitute a waiver that would forgive this legal error.
Judge Young is a man of strongly held views, but when he makes a mistake no one is harder on him than he is on himself. Here is how is he resolved to correct this error:
In short, I botched the jury charge.
What of it? argues NewRiver. In the final analysis, obviousness is matter of law. . . . It is, therefore, rare for a trial judge to vacate a jury verdict on obviousness, having already implicitly ruled that the record is sufficient to support the ultimate finding.
Here, my mistake was more fundamental. I did consider the record sufficient to support the jury’s finding of obviousness. It never occurred to me that patent law trumped the Federal Rules of Evidence on the issue of obviousness. Now, recognizing my error, it is clear that the jury’s verdict cannot stand.
. . . Here, I failed to appreciate the applicable legal framework and thus sent the jury off on a wild goose chase. To disregard their work now and decree a contrary result is to give substance to a good-natured rebuke I once received from a friend, a distinguished British jurist. “You Americans are hypocrites,” he told me. “You praise the jury and do everything you can to keep it from getting in the way.” Not in this Court.
. . .
Upon this botched and murky record, the Court’s duty is clear. . . there must be a new trial before a properly charged jury on the issue of the obviousness vel non of claims 9-11. Likewise, there must be a new trial on the issue of the infringement of claims 9-11 as well. This is only fair since the jury here was a fully empowered and engaged body.It well knew that, as to claims 9-11, it was awarding the ultimate verdict to NewKirk. To insure the requisite degree of confidence in the overall jury verdict, there must be a new trial both on the issue of the obviousness of claims 9-11 and on the issue of the infringement of those claims by Newkirk.
Of course, the courts rarely care much for expense or inconvenience to the parties, and the fact that the parties here must endure another full trial (no small matter), is beside the point.
Lastly, Judge Young included with this comment:
Usually, of course, the law of evidence operates in the shadows. It plays no role until an objection is made. Without objection, the proffered evidence is received for its full probative value. See Peterson v. Gaughan,404 F.2d 1375, 1380 (1st Cir.1968) (noting that although appellant had right to move to strike testimony presented in district court that was permeated with hearsay, counsel did not make motion; evidence was therefore received, and counsel had “intelligently relinquished that right”). I can think of but three instances where a judge is expected to intervene sua sponte. These are questions of witness competence, Rule 601 (because no incompetent testimony may be received), application of the rape shield rule, Rule 412 (because prompt judicial action is thought necessary to protect the putative victim of sexual assault), and the parol evidence rule in contract actions (because it is a substantive rule of commercial transactions and not part of the shadow law of evidence).
There is now, at least in Judge Young’s court, a third instance where a judge must intervene sua sponte, and that is to ensure that an expert witness testifying on anticipation, obviousness, or the doctrine of equivalents in a patent case state the basis for an opinion on these issues.