IP Law Daily, PATENT—Fed. Cir.: $11.5M infringement verdict in smart thermostat patent dispute vacated; new trial ordered, (Jun 5, 2026)

By Saurabh Kashyap, B.A., M.A., LL.B., LL.M.

The district court erred by combining four patents into a single infringement question and by failing to identify the abstract idea underlying one of the asserted patents.

The U.S. Court of Appeals for the Federal Circuit has vacated an $11.5 million patent infringement verdict obtained by a wireless building automation patent owner against smart thermostat manufacturer ecobee Technologies ULC and ordered a new trial on infringement and damages. The appellate court held that the district court improperly allowed the jury to determine infringement of four separate patents through a single verdict-form question, creating a risk that jurors disagreed about which patent had been infringed. The court also vacated and remanded the district court’s patent-eligibility determination regarding one patent after concluding that the jury was not instructed on the abstract idea identified at Alice step one before considering whether the claims contained an inventive concept. However, the court affirmed the eligibility of two other asserted patents and upheld the denial of ecobee’s non-infringement challenge relating to one of those patents (Ollnova Technologies Ltd. v. Ecobee Technologies ULC, No. 25-1045 (Fed. Cir. Jun. 4, 2026)).

Background. The plaintiff/appellant, Ollnova Technologies Ltd., owns patents relating to wireless communications technology used in building automation systems. The defendant/cross-appellant, ecobee Technologies ULC, doing business as ecobee, develops and sells internet-connected smart thermostats and home automation products that communicate wirelessly with building and environmental control systems.

The dispute involved U.S. Patent Nos. 7,860,495 (the ’495 patent), 8,264,371 (the ’371 patent), 7,746,887 (the ’887 patent), and 8,224,282 (the ’282 patent). The patents generally concern improvements to wireless building automation systems. The ’495 patent addresses system redundancy by using dual wireless networks with different communication protocols. The ’887 patent concerns techniques for reducing bandwidth consumption and power usage by limiting when data is transmitted across a wireless network. The ’371 patent relates to transmitting “change-of-value” information within building automation systems while reducing network congestion and mitigating communication failures.

Ollnova sued ecobee in the Eastern District of Texas in 2022, alleging that ecobee’s smart thermostat products infringed the asserted patents. Before trial, ecobee moved to dismiss the claims under 35 U.S.C. § 101, arguing that the patents claimed patent-ineligible subject matter. The district court held that the ’495 patent was directed to an abstract idea but found factual disputes concerning Alice step two. It concluded that the remaining asserted patents were patent-eligible at Alice step one. Following the trial, the jury found that ecobee infringed at least one asserted patent, determined that the asserted claims of the ’282 patent were invalid, rejected ecobee’s eligibility challenge to the ’495 patent, and awarded Ollnova a lump-sum reasonable royalty of $11.5 million. Both parties appealed.

Verdict form error. The Federal Circuit first addressed ecobee’s challenge to the verdict form. The court held that the district court erred by asking the jury whether ecobee infringed “ANY” asserted claim of the four asserted patents rather than requiring separate infringement findings for each patent. Citing Optis Cellular Technology, LLC v. Apple Inc., 139 F.4th 1363 (Fed. Cir. 2025), the court explained that such a verdict form permits jurors to reach a collective infringement verdict even when they disagree about which patent was infringed. The court rejected Ollnova’s argument that general unanimity instructions cured the problem, explaining that jurors could unanimously answer the single infringement question while relying on different patents. Because the verdict form failed to ensure unanimity on each asserted patent, the court vacated the infringement judgment and ordered a new trial.

Patent eligibility of the ’495 patent. The Federal Circuit also agreed with ecobee that the district court improperly instructed the jury regarding Alice step two. The district court had determined that the ’495 patent was directed to the abstract idea of controlling generic building components using information from two separate networks. However, the jury instructions and verdict form failed to identify that abstract idea or explain that the abstract idea itself could not constitute the inventive concept necessary to establish patent eligibility.

Relying on BSG Tech LLC v. BuySeasons, Inc., 899 F.3d 1281 (Fed. Cir. 2018), the court explained that once an abstract idea is identified, the inquiry must focus on whether anything beyond that abstract idea supplies an inventive concept. Without being informed of the abstract idea, the jury could improperly treat the abstract idea itself as the inventive concept. The court therefore vacated the district court’s eligibility determination and remanded for further proceedings under Alice step two.

The Federal Circuit nevertheless rejected ecobee’s request for judgment as a matter of law that the ’495 patent was invalid. The court found sufficient evidence supporting the jury’s determination that the patent’s dual-network architecture was not well-understood, routine, or conventional. Citing Amdocs (Israel) Ltd. v. Openet Telecom, Inc., 841 F.3d 1288 (Fed. Cir. 2016), the court observed that an architecture providing a technological solution to a technological problem can supply the inventive concept required under Alice step two. The record contained evidence that the claimed architecture allowed one wireless network to continue controlling building systems independently when communications with a second network failed, thereby improving the reliability of building automation systems.

Eligibility of the ’887 patent. The Federal Circuit affirmed the district court’s conclusion that the asserted claims of the ’887 patent were not directed to an abstract idea. The court found that the claims recited a specific technological improvement to wireless building automation networks by limiting polling and transmission intervals and requiring data transmission only when monitored conditions moved outside predetermined ranges. Citing Packet Intelligence LLC v. NetScout Systems, Inc., 965 F.3d 1299 (Fed. Cir. 2020), the court explained that claims directed to a specific technological solution to a network-related problem are patent-eligible at Alice step one. According to the court, the ’887 patent improved network operation by reducing unnecessary communications and conserving bandwidth and power.

Eligibility and infringement of the ’371 patent. The Federal Circuit likewise upheld the eligibility of the ’371 patent. The court found that the claims improved communication within building automation systems by aggregating change-of-value information from multiple devices and repeatedly transmitting updates until acknowledgment was received. These techniques reduced wireless bandwidth usage and addressed communication failures within building automation networks.

The court also rejected ecobee’s argument that its products did not infringe because they allegedly failed to repeat the same change-of-value updates. The court found substantial evidence supporting the jury’s verdict, including expert testimony that ecobee thermostats retransmitted the same information when acknowledgments were not received. Accordingly, the court affirmed the district court’s denial of ecobee’s motion for judgment as a matter of law on non-infringement of the ’371 patent.

Because the infringement verdict could not stand, the Federal Circuit vacated the $11.5 million damages award and declined to address the parties’ remaining disputes concerning damages, marking, evidentiary rulings, and prejudgment interest. Those issues may be revisited by the district court on remand if necessary. The case was affirmed in part, vacated and remanded in part, and partially dismissed.

The Case is No. 25-1045.

Judge: Chen, R.

Attorneys: Brett E. Cooper (BC Law Group, PC) for Ollnova Technologies Ltd. Manny Caixeiro (Venable LLP) for Ecobee Technologies ULC d/b/a Ecobee.

Companies: Ollnova Technologies Ltd.; Ecobee Technologies ULC d/b/a Ecobee

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