Crystal Semiconductor Corporation v. Tritech Microelectronics International

On a motion for partial summary judgment, the United States District Court for the Western District of Texas determined that OPTi Inc.'s (OPTi's) and TriTech Microelectronics International, Inc.'s (TriTech's) accused devices literally infringe Crystal Semiconductor Corporation's (Crystal's) U.S. Patent Nos. 4,746,899 ('899 patent) and 5,220,483 ('483 patent). See Crystal Semiconductor Corp. v. OPTi, Inc., No. A 97-CA-026 SS (W.D. Tex. Apr. 20, 1999). After the close of evidence but before the case went to the jury, the district court granted judgment as a matter of law (JMOL) that Crystal's U.S. Patent No. 4,851,841 (the '841 patent) was not invalid due to an on-sale bar. See Crystal Semiconductor Corp. v. OPTi, Inc., No. A 97-CA-026 SS (W.D. Tex. May 12, 1999).

At trial, the jury found that TriTech and OPTi willfully infringed all three patents and awarded damages in excess of $48 million. The district court granted TriTech's JMOL motion that Crystal was not entitled to lost profit or price erosion damages, and remitted Crystal's damages to a reasonable royalty of $10 million. See Crystal Semiconductor Corp. v. OPTi, Inc., No. A 97-CA-026 SS, slip op. at 8 (W.D. Tex. July 23, 1999) (Crystal). The district court then doubled Crystal's damages to $20 million due to TriTech's willful infringement. See id. at 19. The district court also awarded Crystal attorney fees but denied prejudgment interest. See id. at 21.

Because the district court properly granted partial summary judgment of infringement, this court affirms that portion of the judgment. However, because the district court improperly entertained Crystal's JMOL motion on the on-sale bar, this court vacates and remands. Further, because the district court properly granted TriTech's JMOL motion to deny price erosion damages, properly denied TriTech's JMOL motion to void the finding of willfulness, and acted within its discretion in denying prejudgment interest, this court affirms those parts of the judgment. However, because the record shows entitlement to lost profit damages and because the district court erred in its damages calculation, this court reverses and remands to the district court to enter an award as determined by this court.

Crystal, a subsidiary of Cirrus Logic, Inc., is the assignee of the '483, '841, and '899 patents. All three patents involve analog-to- digital (A/D) converter technology. A/D converters convert sound (or analog input voltage information) into digital information and are commonly used in the compact disc burners or sound cards of personal computer (PC) systems.

Sound may be recorded using either analog or digital signals. In an analog recording, sound is converted into an electrical signal by a device such as a microphone. The microphone generates an electrical signal that varies in proportion to changes in pitch, tone, and volume. The voltage signal is an analogous replica of the sound source, thus the name "analog" sound.

A digital recording converts the same sound source into a series of binary numbers, 1s and 0s. This digital signal represents the sound source. A digital signal is not continuous. Rather, it represents a "sampling" of the sound source at regular, closely spaced intervals. Each sample is analogous to a digital snapshot of the sound at a particular point in time. If the sampling is done frequently enough, the digital signal can accurately represent the sound source. Common A/D converters operate at approximately 44.1 kHz, meaning they sample sound approximately 44,100 times per second. In sum, an A/D converter transforms audio waveforms into series of bits. These bits can be processed and stored by a digital recording medium.

Earlier A/D converters were typically made of two or more separate converter circuit devices and several external components. These multiple bulky components operated on two or three power supply voltages. In the late 1970's, the semiconductor industry integrated A/D converters onto a single chip. These integrated-circuit A/D converters are smaller, more reliable, less costly, and consume less power. However, because the single chip design places many components in close proximity, electrical noise is an inherent problem. In particular, components for processing analog inputs generate high frequency bursts that interfere with components for digitizing the input voltage. This electrical noise causes digitization errors that distort the recording.

In general, Crystal's three patents-in-suit relate to techniques for reducing or eliminating the effects of electrical noise in integrated-circuit A/D converter chips. The '899 patent, issued on May 24, 1988, discloses a method for using clock technology to control electrical noise. Under the claimed method, a first clock signal samples the analog input voltage while a separate, delayed clock signal activates operation of the digital circuit. Because activation of the digital circuit is thus offset in time from the analog sampling, the activation signal does not interfere with the analog sampling, or vice versa.

The '841 patent, issued on July 25, 1989, claims an A/D converter with a sampling component called a delta-sigma modulator and a signal digitizing component called a digital decimation filter. These components reduce the effects of noise in the integrated chip. The patent also claims methods for reducing noise. The delta-sigma modulator has a feedback reference voltage input and the digital decimation filter uses impulse-response coefficients. The patent claims recite the reduction of noise through gain scaling -- setting the effective feedback reference voltage on the delta-sigma modulator to a value that is greater than the maximum analog input voltage and correspondingly adjusting the gain of the digital decimation filter.

The '483 patent, issued on June 15, 1993, claims a capacitor structure with a sub-circuit and a tri-layered, insulated capacitor. This capacitor has a guarding structure around the second layer (the sensitive node) to shield extraneous noise.

By 1994, Apple and Intel/Windows PCs included audio systems with stereo sound. These audio systems used a CODEC -- a combination A/D converter and digital-to-analog converter on a single chip. The CODEC transforms analog sound signals into digital form for processing on a PC, and also decodes the digital form back into analog sound so the user can hear it. Crystal incorporated its A/D converter technology, covered by the three patents-in-suit, into CODEC audio chips, and began selling the chips in the audio PC market in 1991. Early audio chips were of relatively low quality, with only eight bits of digitization per sample. Crystal's audio chips are sixteen-bit CODECs and provide higher quality sound than the eight-bit CODECs.

TriTech, a company with facilities in Singapore and California, designs, manufactures, and sells audio chips. In 1994, TriTech began manufacturing sixteen-bit audio CODECs in Singapore and selling the chips worldwide. TriTech sold some of these chips to OPTi, which in turn sold these audio chips under the name "Model 931" to the U.S. PC market.

By March 1995, Crystal reverse engineered several of OPTi's and TriTech's audio chips to determine whether the technology in these chips fell within the scope of Crystal's patents. On January 10, 1997, Crystal filed suit in the United States District Court for the Western District of Texas accusing both TriTech and OPTi of infringing Crystal's '899, '841, and '483 patents.

Following a hearing in January 1998, a special master construed the claims of these patents. J. App. 95-144.1. The district court adopted the Special Master's claim interpretation. Crystal then filed summary judgment motions alleging that the OPTi Model 931 audio chip literally infringed the '483 and '899 patents. The district court entered summary judgment that the Model 931 chips contain every element of claims 1, 6, 9, 10, 15, and 18 of the '483 patent and claims 1, 3, and 4 of the '899 patent. The court left to the jury to decide whether TriTech and OPTi had committed acts of infringement in the United States.

The district court conducted a jury trial on infringement, validity, enforceability, and damages. At the close of evidence, but before jury deliberation, the district court granted Crystal's motion for JMOL that the '841 patent was not invalid under an on-sale bar. The district court further granted Crystal's JMOL motion that the '899 and '841 patents were not unenforceable due to inequitable conduct and were not invalid for violating the best-mode requirement.

Before trial, OPTi conceded infringement of claims 1, 10, and 15 of the '483 patent. The jury returned with a verdict that both TriTech and OPTi literally infringed claim 4 of the '899 patent and claims 2-4 of the '841 patent, and that TriTech literally infringed claims 1, 10, and 15 of the '483 patent. The jury further found both TriTech and OPTi to have infringed claims 2-4 of the '841 patent under the doctrine of equivalents. The jury next found all asserted claims of all three patents nonobvious. On the question of damages, the jury awarded Crystal $11,830,862 in lost profits, $26,649,766 in price erosion damages, and $10,000,000 in reasonable royalties. The jury split the damages, finding TriTech liable for 60% and OPTi liable for 40%. Finally, the jury found TriTech willfully infringed the claims of the asserted patents.

After the jury verdict, TriTech and OPTi requested the trial court on JMOL to reject the jury's lost profits and price erosion verdicts. Crystal opposed the motions and and filed its own motion for prejudgment interest. The district court entered JMOL denying Crystal lost profits and price erosion due to lack of supporting evidence. The court further denied Crystal any prejudgment interest.

TriTech also challenged the jury's willfulness finding by a JMOL motion. The court rejected the challenge. Based on this willfulness finding, the court doubled Crystal's reasonable royalty award and entered a total enhanced damage award of $20,000,000.

Crystal appeals the district court's denial of the jury's lost profits and price erosion verdicts and the court's denial of Crystal's request for prejudgment interest. TriTech cross-appeals the court's grant of JMOL that Crystal's '841 patent is not barred by premature sale, the court's construction of the '483 patent's claims, the court's grant of summary judgment of literal infringement of the '483 and '899 patents, the jury's finding that TriTech infringed the '899 patent, the jury's verdict of willful infringement of the '483 and '841 patents, and the court's enhanced damages calculation. Before appeal, OPTi settled its case with Crystal. This court has jurisdiction to hear Crystal's appeal and TriTech's cross-appeal under 28 U.S.C. § 1295(a)(1) (1994).

This court reviews without deference a district court's grant of summary judgment and draws all reasonable factual inferences in favor of the non-movant. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986); Cortland Line Co. v. Orvis Co., 203 F.3d 1351, 1355, 53 USPQ2d 1734, 1746 (Fed. Cir. 2000).

Patent infringement involves both claim construction and application of the claim to the accused product. Markman v. Westview Instruments, Inc., 52 F.3d 967, 976, 34 USPQ2d 1321, 1326 (Fed. Cir. 1996) (en banc), aff'd, 517 U.S. 370 (1996). Claim construction is a matter of law that this court reviews without deference. Cybor Corp. v. FAS Techs., Inc., 138 F.3d 1448, 1454, 46 USPQ2d 1169, 1172 (Fed. Cir. 1998) (en banc). Application of the claim to the accused device is a question of fact, findings of which are accorded substantial deference on review. Embrex, Inc. v. Serv. Eng'g Corp., 216 F.3d 1343, 1348-49, 55 USPQ2d 1161, 1164 (Fed. Cir. 2000). The infringement inquiry remains focused at all times on the claim language, as illuminated by the written description and the prosecution history. Pitney Bowes, Inc. v. Hewlett-Packard Co., 182 F.3d 1298, 1309, 51 USPQ2d 1161, 1169 (Fed. Cir. 1999).

This court reviews without deference a district court's grant of JMOL under Federal Rule of Civil Procedure 50. Burroughs Wellcome Co. v. Barr Lab. Inc., 40 F.3d 1223, 1227, 32 USPQ2d 1915, 1919 (Fed. Cir. 1994). On appeal, this court applies the same standard as the district court. Id. This court affirms a grant of JMOL if substantial evidence does not support the jury's factual findings or if those factual findings do not support the jury's legal conclusions. Id.

The measurement of patent damages is a question of fact. Brooktree Corp. v. Advanced Micro Devices, Inc., 977 F.2d 1555, 1578, 24 USPQ2d 1401, 1417 (Fed. Cir. 1992). This court, therefore, reviews a jury's damage award for substantial evidence. SmithKline Diagnostics, Inc. v. Helena Lab. Corp., 926 F.2d 1161, 1164 n.2, 17 USPQ2d 1922, 1925 n.2 (Fed. Cir. 1991).

A jury verdict of willful infringement is a question of fact and is reviewed by this court for substantial evidence. Hoechst Celanese Corp. v. BP Chems. Ltd., 78 F.3d 1575, 1582, 38 USPQ2d 1126, 1132 (Fed. Cir. 1996). To establish willful infringement, a plaintiff must prove by clear and convincing evidence that the defendant acted without a reasonable belief that its action avoided infringement. E.I. DuPont de Nemours & Co. v. Phillips Petroleum Co., 849 F.2d 1430, 1440, 7 USPQ2d 1129, 1137 (Fed. Cir. 1988).

This court reviews a district court's denial of prejudgment interest for an abuse of discretion. Lummus Indus., Inc. v. D.M. & E. Corp., 862 F.2d 267, 275, 8 USPQ2d 1983, 1989 (Fed. Cir. 1988). However, the discretion of the district court in denying prejudgment interest is limited to specific circumstances. Gen. Motors Corp. v. Devex Corp., 461 U.S. 648, 657 (1983) ("[P]rejudgment interest should be awarded under § 284 absent some justification for withholding such an award."); Lummus at 275.

Claim 1 of the '483 patent recites three main elements: (1) a substrate, (2) a sub-circuit, and (3) a capacitor with three sandwiched layers -- each "disposed over a portion" of the underlying layer. The tri-layered structure has a first conductive layer of a material such as polysilicon. This layer lies over the semiconductor substrate. A second conductive layer of a material, such as a metal, lies over the first layer surrounded by a guarding capacitor structure. A third layer of a material, such as a metal, lies over the second layer. An insulating layer separates each of these three layers from one another. Thus the invention describes a sandwiched structure as depicted in Figure 2 of the '483 patent (the first, second, and third layers labeled as 34, 36, and 38 respectively).[Tabular or Graphical Material Omitted]

a capacitor having first and second plates formed on the first face of said semiconductor substrate, said capacitor having:

a first conductive layer disposed over a portion of the first face of said semiconductor substrate and separated therefrom by a first insulating layer,

a second and shielded conductive layer disposed over a portion of said first conductive layer and separated therefrom by a second insulating layer,

a third conductive layer disposed over a portion of said second and conductive layer and separated therefrom by a third insulating layer,

a fourth conductive layer disposed in substantially the same plane as said second shielded conductive layer and disposed a predetermined distance therefrom and a third connecting device for connecting said fourth conductive layer to a predetermined voltage.

(emphasis added). The trial court construed "disposed over a portion" to require an "area of coincidence between the two layers greater than zero." Thus, the court interpreted claim 1 to encompass capacitor structures with layers covering anywhere from a small area to the entire area of the underlying surface.

Claim language itself sets the claim scope. Vitronics Corp v. Conceptronic, Inc., 90 F.3d 1576, 1582, 39 USPQ2d 1573, 1577 (Fed. Cir. 1996). This court has consistently emphasized that the indefinite articles "a" or "an," when used in a patent claim, mean "one or more" in claims containing open-ended transitional phrases such as "comprising." KCJ Corp. v. Kinetic Concepts, Inc., 223 F.3d 1351, 1356, 55 USPQ2d 1835, 1839 (Fed. Cir. 2000); see Elkay Mfg. Co. v. Ebco Mfg. Co., 192 F.3d 973, 977, 52 USPQ2d 1109, 1112 (Fed. Cir. 1999); AbTox, Inc. v. Exitron Corp., 122 F.3d 1019, 1023, 43 USPQ2d 1545, 1548 (Fed. Cir. 1997). "Under this conventional rule, the claim limitation `a,' without more, requires at least one." KCJ at 1356 (emphasis added).

Based on this conventional rule, because claim 1 is open-ended, the limitation "disposed over a portion" means "disposed over at least one portion." This claim construction comports completely with the district court's claim construction. Thus, claim 1's proper construction does not limit "disposed over a portion" to only a portion of the layer beneath. In other words, claim 1 includes within its scope a capacitor structure with layers disposed over the entirety of the underlying surface. Claim 1 does not require a capacitor structure shaped like a three-tiered wedding cake, with the first layer being largest in surface area and the third layer being smallest, or stacked like staggered, partly overlapping layers.

When a patent claim uses the word "comprising" as its transitional phrase, the use of "comprising" creates a presumption that the body of the claim is open. In the parlance of patent law, the transition "comprising" creates a presumption that the recited elements are only a part of the device, that the claim does not exclude additional, unrecited elements. See KCJ, 223 F.3d at 1356.

The transition "having" can also make a claim open. Regents of the Univ. of Cal. v. Eli Lilly & Co., 119 F.3d 1559, 1573, 43 USPQ2d 1398, 1410 (Fed. Cir. 1997). However, the term "having" does not convey the open-ended meaning as strongly as "comprising." "Having," for instance, does not create a presumption that the body of the claim is open. Therefore, this court examines the claim in its full context to determine whether Crystal's use of "having" limits claim 1 to its recited elements.

The language of claim 1 itself does not limit the term "having" to a closed meaning. The '483 patent discloses a capacitor structure that shields the sensitive plate of the capacitor from stray noise. The "Background of the Invention" describes typical prior art capacitors with a two-plate structure. Col. 1, ll. 58-68. The top plate served as a "sensitive `virtual ground' capacitor plate" while the bottom "shield[ed] the sensitive node from substrate noise." Id. These two- plate capacitors were "still susceptible to noise coupling onto the sensitive top plate through passivation and packaging dielectrics." Id. at 66-68. The claimed tri-layered structure improves noise shielding. The first and third layers are connected together and operate "to shield... the second conductive layer, from noise resulting from external sources or from the semiconductor substrate." Col. 2, ll. 19-24; col. 4, ll. 8-11 ("[T]he upper metal plate 38 is operable to shield the shielded plate 36 from noise resulting from signals that are disposed above the plate 38.").

Figure 6 illustrates that the preferred embodiment of the claimed '483 invention shields against noise by entirely covering the middle layer (36):[Tabular or Graphical Material Omitted]

According to the written description, the fourth conductive layer (also called the conductive ring 82) "is disposed between the contacts 84 and 85, and the shielded plate 36 to substantially eliminate stray capacitance between plate 34 and sensitive plate 36." Col. 5, ll. 10-15. Contacts 84 connect the upper conductive layer to the intermediate interconnection strip 83 as depicted in Figure 6. Col. 5, ll. 42-50. Contacts 85 connect the lower conductive layer to the same interconnection strip to link the upper and lower layers. Because the conductive ring "is disposed between plate 34 and contacts 84 and 85," a capacitor structure with such a conductive ring must have a middle layer that is smaller in surface area than the upper and lower layers. In other words, because claim 1 recites this fourth conductive layer, the written description requires claim 1 to encompass a capacitor structure wherein the third layer covers the entirety of the second layer.

The written description thus shows the intent to make claim 1 at least partially open to permit the limitation "disposed over a portion" to mean "disposed over at least one portion." Any assertion that "disposed over a portion" means "disposed over only one portion" would contradict the clear purpose of the invention as described in the written description, depicted in Figure 6, and recited in claim 1. Such an assertion would also impermissibly read the preferred embodiment out of claim 1. Vitronics, 90 F.3d at 1583.

The accused Model 931 device has first and third layers of approximately equal size and a smaller second, or middle, layer. Because each layer overlies a portion of the underlying layer, the Model 931 literally infringes claim 1 of the '483 patent. Therefore, this court detects no error in the district court's reading of the "over a portion" limitation and its application of that claim language to the accused device.

Claim 1 also requires that the conductive ring in the devices is "disposed a predetermined distance" from the second layer. The district court construed the term "predetermined distance" in claim 1 to mean "[a] distance that is determined before the fourth conductive layer is disposed on the substrate and that is sufficiently close to the second shielded conductive layer to provide acceptable shielding." The parties do not dispute this claim construction. This court must address, however, whether this language reads on the accused Model 931.

TriTech alleges that the conductive guard ring structure in the Model 931 is "noisy" because it is "positioned so that it is not as close as possible to the second conductive layer... but is instead spaced at almost twice the minimum distance possible." Thus, the Model 931 guard ring structure allegedly does not provide "acceptable shielding" against noise. This court must determine whether these factual allegations raise genuine issues that preclude summary judgment.

In summarily finding literal infringement, the district court stated: "[T]he crucial issue is whether the guard ring is located close enough to the second conductive layer so that it could provide acceptable shielding, not whether the guard ring actually provides acceptable shielding in practice." This court discerns no error in the district court's interpretation of claim 1 or its application of the claim to the Model 931. The parties do not dispute that the Model 931 guard ring structure is disposed a uniform distance (1.3 microns) from the second conductive layer. Thus, the district court correctly entered summary judgment of literal infringement.

The '899 patent claims a method for reducing the effect of noise on the analog sampling process by switching digital section logic gates in an A/D converter. The patent discloses two sets of clocks: one to control timing of the analog sampling in the analog section; the other to control timing of the logic gate output switching in the digital section. By offsetting the two clocks, digital logic gate switching occurs during gaps in the analog sampling. Clock offsetting prevents digital logic gate noise from affecting analog signal sampling.

The disputed portion of claim 4, which is dependent on claim 1, recites:

a method for reducing deleterious effects of said electrical noise on the analog-to-digital conversion process, said method comprising:

a. providing a first clock signal to said analog circuitry for controlling the sampling of an analog input voltage;

c. generating a second clock signal having its leading edge delayed with respect to the trailing edge of said first clock signal....

(emphasis added). In construing the claims, the district court explained: "[T]he integrated circuit must have at least one common reference clock (either digital or analog...)." The district court further stated: "[The phrase] `first clock signal'... indicates the analog circuit clock signal comes prior to the `second' digital circuit clock signal. Again, this language does not limit the claims construction to one clock."

As the district court correctly noted, "a first clock signal" does not require a single clock signal to control sampling. As previously discussed, the word "comprising" in the transitional phrase of a patent claim creates a presumption that the body of the claim is open. Because claim 4 uses "comprising," it encompasses more than one clock unless the written description or the prosecution history clearly limits claim 4 to its recited elements. Similarly, the article "a" in "a first clock signal" generally suggests one or more clocks. The written description and figures of the '899 patent actually disclose two analog clocks, ACLK1 and ACLK2, in the preferred embodiment. See, e.g., col. 2, ll. 52-56; col. 4, ll. 16-26; Fig. 3. According to the preferred embodiment, analog clock ACLK1 accepts the analog input voltage (the charge), analog clock ACLK2 transfers the charge to or from the feedback capacitor.

Although ACLK1 provides the first clock signal for controlling the sampling of an analog input voltage, neither the written description nor the prosecution history precludes more than one clock or clock signal. In sum, the '899 patent does not limit "a first clock signal" to only one clock. The district court, therefore, did not err in granting summary judgment that claim 4 reads on the accused Model 931 chip, which uses four clocks.

Tritech did not practice the claimed '899 method in the United States. TriTech, therefore, cannot be liable for direct infringement under 35 U.S.C. § 271(a) (1994). TriTech's acts in connection with selling its chip to OPTi, however, constitute active inducement under 35 U.S.C. § 271(b).

Inducement only occurs if the party being induced directly infringes the patent. E.g., Micro Chem., Inc. v. Great Plains Chem. Co., 103 F.3d 1538, 1549, 41 USPQ2d 1238, 1247 (Fed. Cir. 1997). The verdict form and jury instructions in the present case required the jury to make findings on literal infringement, not direct infringement. The jury found that both OPTi and TriTech infringed claim 4 of the '899 patent. The parties do not dispute that any infringement by OPTi was direct because OPTi practiced the claim method of the '899 patent in the United States. The trial court properly instructed the jury to assess whether TriTech literally infringed by actively inducing OPTi's direct infringement. Thus, because the jury found infringement by OPTi, this court discerns no error in the jury's verdict of literal infringement by TriTech.

The district court instructed the jury on willful infringement. TriTech did not object to these instructions. TriTech seeks to vacate the jury's verdict of willful infringement for the '483 and '841 patents because its defenses of invalidity and non-infringement to the present suit were not frivolous.

When an infringer has actual notice of a patentee's rights, the infringer has an affirmative duty of due care to avoid infringement. Avia Group Int'l Inc. v. L.A. Gear Cal., Inc., 853 F.2d 1557, 1566, 7 USPQ2d 1548, 1555 (Fed. Cir. 1988). Contrary to TriTech's assertions, Gustafson, Inc. v. Intersystems Industrial Products, Inc., 897 F.2d 508, 13 USPQ2d 1972 (Fed. Cir. 1990), did not change this requirement of due care on the part of the potential infringer. Rather, Gustafson stated: "Exercising due care, a party may continue to manufacture and may present what in good faith it believes to be a legitimate defense without risk of being found on that basis alone a willful infringer." Id. at 511 (emphasis added). Gustafson did not hold, as a matter of law, that a party that continues its accused infringing activity after a patentee files suit cannot be guilty of willful infringement as long as that party presents a non-frivolous defense to infringement.

TriTech did not obtain any competent legal opinion of non- infringement or invalidity after Crystal notified TriTech of its potential infringement by filing suit. Although TriTech obtained counsel to defend this action, defenses prepared for a trial are not equivalent to the competent legal opinion of non-infringement or invalidity which qualify as "due care" before undertaking any potentially infringing activity. Also, the record shows that TriTech copied Crystal's patented parts to develop the infringing devices. See, e.g., Advanced Display Sys., Inc. v. Kent State Univ., 212 F.3d 1272, 1285, 54 USPQ2d 1673, 1681 (Fed. Cir. 2000) (stating that evidence of copying is relevant to a determination of willfulness). Furthermore, TriTech had known of Crystal's '899 patent since 1994 and had even altered its chip design in an unsuccessful attempt to design around the '899 patent. TriTech, however, never sought advice of counsel as to whether it was infringing Crystal's patents. Because the jury's verdict that TriTech willfully infringed Crystal's '483 and '841 patents is not clearly erroneous, this court affirms.

Under 35 U.S.C. § 102(b), an invention on sale more than one year before patent application filing date cannot receive a patent. Pfaff v. Wells Elec., Inc., 525 U.S. 55, 48 USPQ2d 1641 (1998). In Pfaff, the Supreme Court applied this on-sale bar when, more than one year before the filing of a patent application: (1) a product embodying the patented invention was offered for commercial sale; and (2) the invention was ready for patenting. Id. at 67.

The record in this case contains allegations that Crystal sold or offered to sell its CS5316 chip, undisputedly an embodiment of the '841 invention, before the critical date October 2, 1986. Before jury deliberation, Crystal filed a JMOL motion to preclude TriTech's on-sale bar defense alleging insufficient evidence to show a commercial offer for sale of the CS5316. The district court granted Crystal's JMOL motion.

The record, however, contains evidence on which a reasonable jury could have found an on-sale bar. For example, the record shows that on September 11, 1986, Crystal received a purchase order confirmation from E.S.P. Microscape for five CS5316 parts. This purchase order, listing part numbers and price information, called for shipment to Canada. Crystal's accountants counted E.S.P.'s $214.25 order as revenue for the month of September but did not ship the CS5316 parts until October 9, 1986, after the critical date. Crystal asserts that it placed this purchase order on hold and did not accept it until after the critical date.

The record also shows that Crystal shipped two CS5316 parts to its distributor on September 22, 1986, for delivery to Lions Systems. In an informational letter to a professor, Crystal classified this shipment as the first commercial exploitation of the CS5316. Crystal also characterized this shipment as the first "commercial exploitation" of its CS5316 in a Mask Work Registration filed with the United States Copyright Office in October of 1986. Crystal asserts that the shipment does not qualify as a sale because it was an engineering sample of no value that it shipped to a customer site at no charge for confidential testing. Although this alleged experimental use, if proven, would negate an on-sale bar, it does not negate the record evidence of an alleged commercial exploitation. Construing this evidence, as it must, in a light favorable to TriTech, this court concludes that a reasonable jury deserved to weigh the facts and determine whether Crystal's '841 patent is subject to an on-sale bar. This court, therefore, vacates the district court's grant of JMOL of no on-sale bar and remands for a trial on this issue.

This court recognizes that this remand on the '841 patent does not affect the damages calculation in this case. The parties do not dispute the reasonable royalty award and neither party has asked for any reasonable royalty recalculation based on the validity of any of the patents. The lost profits calculation in this case may rest on the infringement of the '899 patent alone.

Section 284 of title 35 of the United States Code provides: "Upon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court." Thus, a reasonable royalty for each infringing device sold by TriTech and OPTi is the minimum measure of damages in this case. Crystal, the patentee, bears the burden of proving its damages. SmithKline Diagnostics, 926 F.2d at 1163.

Section 287(a) of title 35 further provides that, without adequate marking, "no damages shall be recovered by the patentee in any action for infringement, except on proof that the infringer was notified of the infringement and continued to infringe thereafter." 35 U.S.C. § 287(a). If the infringer continues to infringe after receiving notice, the patentee may recover damages.