Federal Circuit Reverses District Court’s
Denial Of Motion To Supplement Complaint To Assert Declaratory Judgment Of
Newly Issued patents
In Arkema Inc. et
al. v. Honeywell International Inc. (Appeal No. 2012-1308), the Federal
Circuit reversed the district court’s denial of a motion
for leave to supplement a complaint by adding declaratory judgment claims
regarding two newly issued patents.
In November 2009, Honeywell
filed suit against Arkema for infringement of a European patent based on
Arkema’s offers to sell HFO-1234yf (“1234yf”), a next generation automotive
refrigerant, in Germany. In June 2010, Arkema brought suit against Honeywell
in the U.S. District Court for the Eastern District of Pennsylvania, seeking
declaratory judgment that the asserted patents were invalid and not
infringed by Arkema’s plans to supply
U.S. automobile manufacturers with 1234yf. Honeywell
counterclaimed, asserting that Arkema’s sale and offer for sale of 1234yf in
the U.S. constituted infringement. Honeywell specifically alleged (and Arkema admitted) that Arkema “has
sought, and continues to seek, to compete with Honeywell for supplying 1234yf
to automobile manufacturers in the U.S.,” and that Arkema is “aware that U.S.
automobile manufacturers purchase . . . 1234yf primarily or exclusively for
use in automobile air conditioning systems.” While the suit was in discovery, Honeywell
obtained two additional patents covering methods of using 1234yf, the ’120
and ’882 patents. Arkema then moved to
supplement its complaint to seek declaratory judgment of non-infringement and
invalidity as to the ’120 and ’882 patents, fearing liability under those
patents should it proceed with plans to sell 1234yf to U.S. automobile
manufacturers.
The district court denied Arkema’s
motion to supplement its complaint finding that Arkema’s new claims did not present
an Article III case or controversy. The district court concluded that Arkema
could not be charged with directly infringing the ’120 and ’882 patents
because, as a mere supplier, Arkema had no plans to use 1234yf in any manner
that could directly infringe those patents, which cover only methods of using
1234yf. As for indirect infringement, the district court concluded that Arkema
“is not currently or imminently in danger of facing liability for
contributory infringement or induced infringement.”
The Federal Circuit disagreed,
holding that the controversy between Arkema and Honeywell regarding the ’120
and ’882 patents is “of sufficient immediacy and reality to warrant the
issuance of a declaratory judgment.” The
case was reversed and remanded to the district court.
Federal Circuit Reverses Summary Judgment Of
Noninfringement Based Upon Equitable Estoppel
In Radio Systems Corp. and Innotek, Inc. v. Tom Lalor and Bumper Boy,
Inc. (Appeal No. 2012-1233), the Federal Circuit reversed the district
court’s grant of summary judgment of noninfringement based on the doctrine of
equitable estoppel.
The
district court had found that Bumper Boy misled Innotek through its 2005
demand letter and subsequent silence for over four and a half years. The
court also found that Innotek relied on this silence by significantly
expanding its product line and by being acquired by Radio Systems. The court
found that Innotek’s investment in new products constituted economic
prejudice. The court concluded that equitable estoppel applied to Bumper
Boy’s allegations against Innotek.
The
court further reasoned that equitable estoppel also barred Bumper Boy’s
allegations against Radio Systems because it: (1) wholly owns Innotek; (2) is
headed by the same individual as Innotek; (3) purchased Innotek to
incorporate its designs and products into its own product lines; and (4)
exerts substantial control over Innotek. In granting summary judgment of noninfringement, the district court
found that Bumper Boy was equitably estopped from alleging that the Radio
Systems accused collar infringed the ’014 and ’082 patents.
Bumper
Boy argued, inter alia, that even
if equitable estoppel applied to the
’014
patent, it cannot apply to the ’082 patent because Bumper Boy “never accused
either Innotek or Radio Systems of infringing the ’082 patent prior to
November 2009.”
The
Federal Circuit affirmed the district court’s finding of equitable estoppel
with respect to the ’014 patent, as all three elements of equitable estoppel
were present. The Federal Circuit also
affirmed the district court’s finding that equitable estoppel barred Bumper
Boy’s infringement claims against Radio Systems, Innotek’s successor-in-interest
because precedent confirms that equitable estoppel
applies
to successors-in-interest where privity has been established.
However,
the Federal Circuit concluded that the district court had abused its
discretion in extending equitable estoppel to the ’082 patent. The first
notice of infringement to Radio Systems regarding the ’082 patent was in
Bumper Boy’s November 2009 demand letter. Regardless of whether the ’082 patent claims
are supported by the subject matter in the’014 patent, the patents contain
claims of different scope. The ’082
patent claims could not have been asserted against Innotek or Radio Systems
until those claims issued. As a
result, the elements of equitable estoppel were not present with respect to
the ’082 patent. Accordingly, the
Federal Circuit concluded that the district court abused its discretion by
granting summary judgment of noninfringement with respect to the ’082 patent on
the basis of equitable estoppel and reversed the district court’s judgment.
Judge
Newman, who filed a separate opinion concurring in part and dissenting in
part, stated that she would also apply estoppel to the ’082 patent.
Federal
Circuit Affirms Dismissal Of Complaint
In Semiconductor Energy Laboratory Co.,
Ltd. v. Yujiro
Nagata (Appeal No. 2012-1245), the Federal Circuit affirmed the district court’s dismissal
of SEL’s
complaint
with prejudice pursuant to Fed. R. Civ. P. 12(b)(1) for lack of subject
matter jurisdiction under 28 U.S.C. § 1338(a) and declining to exercise supplemental jurisdiction over a number of
state law claims.
SEL
owns U.S. Patent 6,900,463 (the “’463 patent”), which names Dr. Yujiro Nagata
(“Nagata”) as a coinventor. During prosecution in 1991, Nagata assigned
his
rights to applications and patents related to the ’463 patent to SEL’s
founder Dr. Shunpei Yamazaki, and subsequently signed a substitute
Declaration and Assignment of those applications and patents. From 2002 to
2003, Nagata assisted SEL in a patent infringement suit against another party
and was paid for his cooperation and services relating to that litigation.
In
2009, SEL brought suit for infringement of a number of patents, including the
’463 patent, against Samsung, Inc. and others. SEL contacted Nagata for further
assistance, assuming that he would cooperate as he had in the earlier case,
but learned instead that Nagata had agreed to assist Samsung in the
litigation as a fact witness. During the proceedings, Nagata gave testimony
repudiating his signature on
the 1991 Declarations and Assignments. Samsung then claimed that the
patents-at-issue, including the ’463 patent, were unenforceable due to
inequitable conduct, alleging that the documents were forged. The dispute
eventually was settled, but SEL maintained that because Nagata’s testimony
impugned the enforceability of the ’463 patent, SEL settled for less money
than it would have otherwise. SEL
subsequently brought suit against Nagata.
Nagata
moved to dismiss SEL’s complaint under Fed. R. Civ. P. 12(b)(1) for lack of
subject matter jurisdiction. The district court granted Nagata’s motion,
dismissing SEL’s complaint with prejudice for lack of subject matter
jurisdiction because the doctrine of assignor estoppel does not provide a
cognizable federal cause of action. The district court further held that
SEL’s “artful pleading” of the state law claims did not give rise to subject
matter jurisdiction under 35 U.S.C. § 1338(a) because: (1) there was no
federal law central to each of the counts, as the doctrine of assignor
estoppel did not even apply to the facts of this case; and (2) federal patent
law was not essential to those claims as they were supported by alternative
state law theories. Thus, the district
court declined to exercise supplemental jurisdiction over the state law
claims.
The
Federal Circuit affirmed the dismissal, holding that the
district court did not
err in holding that SEL failed to invoke federal subject
matter jurisdiction because there was no federal cause of
action based on the affirmative application of the doctrine of assignor
estoppel and because disposition of the state law claims did not necessarily
require resolution of a substantial issue of federal patent law. Furthermore, the district court did not
abuse its discretion in declining supplemental jurisdiction over the state
law claims.
Federal
Circuit Reverses Grant Of Summary Judgment
In Brilliant
Instruments, Inc. v. GuideTech, Inc. (Appeal
No. 2012-1018), the Federal Circuit reversed the district court's grant of summary
judgment of noninfringement based on the doctrine of equivalents.
In
November 2009, Brilliant brought a declaratory judgment action for
non-infringement of the U.S. Patent Nos. 6,226,231, 6,091,671, and 6,181,649
(the ‘231, ‘671, ‘649 patents) assigned to GuideTech. GuideTech
counterclaimed, asserting infringement of these patents. The district court
granted summary judgment of noninfringement as to all three patents.
On
appeal, the Federal Circuit held that the district court erred when it granted
summary judgment with respect to the ‘231 patent because a genuine issue of
material
fact exists as to how the accused products function. The evidence raised a
genuine issue of material fact as to whether Brilliant’s products literally
infringe the ’231 patent claims, such that summary judgment should not have
been granted.
With respect to the ’671 and ’649 patents, the Federal
Circuit held that the district court properly granted summary judgment that
Brilliant’s accused products do not literally infringe, but that the district court erred when it granted summary judgment
that Brilliant does not infringe under the doctrine of equivalents.
Specifically,
GuideTech argued that there was nothing in the claims that precluded a
certain capacitor from being part of the first circuit and at the same time
being operatively disposed in parallel and pointed to its expert, Dr. West’s
detailed explanation of how the accused capacitor was operatively equivalent
to the claimed capacitor. The Federal Circuit agreed with Guidetech that the
expert’s testimony created a genuine issue of material fact which precluded
summary judgment of noninfringement. Accordingly,
the Federal Circuit reversed and remanded the district court’s grant of
summary judgment.
Judge
Dyk filed a dissent, reiterating that the function-way-result test for the
doctrine of equivalents requires a “showing on limitation-by-limitation” and
argued that the expert report did not actually consider equivalents to the
particular limitation at issue, but was an application of the equivalent to
the invention as a whole. |
