Oblon, Spivak Wins Another Complex Patent Case At The Federal Circuit Court Of Appeals; No Equivalents Infringement Of A Variety Of Patent Claims For Self-Mailer Business Forms

Case Synopsis

On September 22, 2000, the Federal Circuit upheld an order granting three separate summary judgment motions filed in March-April 1998 by the Oblon, Spivak firm in the U.S. District Court for the Eastern District of Virginia. The ruling affirmed Oblon, Spivak's position that its client did not infringe under the doctrine of equivalents any claims of three patents in the original lawsuit brought 33 months earlier. Moore U.S.A., Inc. v. The Standard Register Company, ___ F.3d ___, __ USPQ2d __, 2000 U.S. App. LEXIS 23715 (Appeal Nos. 98-1386,-1387) (Fed. Cir. 2000).

Plaintiff Moore's patents are for self-mailer-type business forms with integral return envelopes. The Federal Circuit agreed with the Oblon, Spivak firm that a patent claim for a business form with adhesive strips along a "majority of the lengths" was not infringed under the doctrine of equivalents by forms with strips along 47.8% of the lengths, i.e., a minority of the lengths. The Court also rejected an argument by Moore, with respect to another patent claim, that the Supreme Court's 1929 decision in the Sanitary Refrigerator case condones application of the doctrine of equivalents to a mere "rearrangement of claim elements." The Federal Circuit found no inconsistency between Sanitary Refrigerator and its 1997 opinion in the Sage Products case. Another Moore patent claim, calling for all form edges to be "devoid of adhesive," was found by the Court not to be infringed by a business form with adhesive along one edge. Judge Newman concurred-in-part, and dissented-in- part.

Detailed Analysis of the Federal Circuit's Opinion

On December 22, 1997, Moore filed suit against the Oblon, Spivak firm's client, defendant The Standard Register Company ("SRC"), in the U.S. District Court for the Eastern District of Virginia ("Eastern District" or "the lower court") for infringement of four patents. In four separate orders, the Eastern District granted SRC's motions for partial summary judgment ("SJ") (i) of non- infringement of the ‘464, ‘798, and ‘110 patents, and (ii) of Moore's inability to establish standing as the exclusive licensee of the last of the four suit patents, the ‘128 patent. (This latter issue was not appealed by Moore to the Federal Circuit). As a result of the four orders, the Eastern District dismissed the entire suit with prejudice. On appeal, Moore took issue with the lower court's holding of no infringement by equivalents with respect to the ‘464 patent, and its holding of both literal and no equivalents infringement of the ‘798 and ‘110 patents. The Federal Circuit affirmed on all counts.

The Suit Patents

The ‘464, ‘798, and ‘110 patents all relate to paper business-form self-mailers. The ‘128 patent relates to an adhesive used on the mailers. The business mailer of the ‘464 patent has an integral return envelope created as part of the mailer during the folding and sealing process. The ‘798 patent solves the problem of adhesive interfering with the rollers of a printer used with mailers. The business mailer of the ‘110 patent is double-folded to provide four panels on which to print a greater amount of information.

The ‘464 Patent

One of the key limitations of the ‘464 claims calls for adhesive strips "extending the majority of the lengths" of particular portions of the mailer. The adhesive strips of the accused SRC mailers extended 47.8% of the lengths of those portions. Recognizing this fact, Moore did not dispute SRC's arguments against literal infringement, but instead contended infringement under the doctrine of equivalents ("DOE"). At first, the Eastern District denied SRC's SJ motion under the DOE because of a genuine issue of material fact as to whether the accused SRC mailer had elements which "function like the patented mailer, in the same way, to get the same result." However, on SRC's motion for reconsideration -- based primarily upon Sage Products, Inc. v. Devon Industrial, Inc., 126 F.3d 1420, 44 USPQ2d 1103 (Fed. Cir. 1997), the Eastern District granted SRC's SJ motion because, applying the DOE as argued by Moore, would "remove entirely the ‘majority of the lengths' limitation" of the claims. With regard to certain other patent claims, the lower court explained further that "[u]nder Sage, there can be no infringement under the DOJ if the accused infringer ‘achieves the same result ... but does so by a different arrangement of elements." Emphasis in the original. Thus, the Eastern District rejected Moore's contention that the Supreme Court's decision in Sanitary Refrigerator Co. v. Winters, 280 U.S. 30 (1929) condoned the "rearrangement of claim limitations" in an accused device -- and thus overrode the Federal Circuit's "language" in Sage.

The ‘798 Patent

Mailer forms for printing on an IBM 3800 printer are supplied to the printer in a continuous web. However, when the IBM 3800 printer pauses, movement of the continuous web forms stops -- thereby creating an impression in the forms into which pressure-sensitive adhesive can fall, and thus can frequently cause sticking to the rollers during the pauses. The solution to this problem, as provided by the ‘798 patent, is the strategic placement of the adhesive, i.e., the adhesive is "spaced ... a distance sufficient to insure that the adhesive does not interfere with rollers of a printer used to process the mailer during pausing of the printer." Some of the ‘798 patent claims call for a numerical limitation for the spacing (5/16 inch away from its associated "transverse edge"); others call for no numerical limitation.

During PTO prosecution, the "distance sufficient" limitation was rejected as indefinite under 35 U.S.C. § 112 because "it is impossible to determine the distance claimed," and especially because "[i]n this invention, the exact spacing is critical ...." In response, the applicant characterized the limitation as a "functional description, providing a complete, definite and accurate statement of what the spacing should be." The claims were subsequently allowed. In the accused SRC forms, adhesive is located approximately 1/16 inches from the leading and trailing edges, but according to SRC the adhesive does not interfere with the printer rollers, during printer pauses, due to its superior composition.

The Eastern District concluded that the "distance sufficient" limitation is in reference to the IBM 3800 printer and, because that printer makes a 1/4 inch-wide impression, the limitation had to be "more than 1/4 inch." The lower court thus rejected the declarations by Moore's counsel that the adhesive on SRC's forms is spaced greater than 1/16 or 1/8 inch, since the declarations nowhere stated that the relevant distances are "about 5/16 inch."

The ‘110 Patent

One of the key limitations of the ‘110 patent claims calls for a sheet of its mailer to be "devoid of adhesive extending along said end edges of said sheet between ... longitudinal lines of weakness" (i.e., perforation lines). As originally filed, the relevant patent claims called for the sheet to be "devoid of adhesive extending along said end edges of said sheet, or parallel to said end edges of said sheet." Those original claims were rejected under 35 U.S.C. § 103 because the prior art showed intermittent rectangles of adhesive covering roughly 75% of the area between its perforation lines. Accordingly, the examiner explained that it would have been obvious to "omit adhesive in the end edges of the sheet of [that prior art reference] when its function was not desired."

In the final reply, the phrase "parallel to said end edges of said sheet" was deleted from the claims and the following comments made:

[T]he provision of said end edges being devoid of adhesive decreases costs as well as processing time, and makes the end envelope easier to open ... This also decreases the amount of waste generated by the consumer.

The examiner then rejected the amended claims as indefinite under 35 U.S.C. § 112 because the end edges are not "devoid of adhesive," since the elongated patterns of adhesive collectively extend the entire longitudinal length of the sheet. In addition, the examiner applied a new secondary reference, in combination with the original prior art reference, to reject the amended claims.

In reply, the claims were amended further by adding the phrase "between said longitudinal lines of weakness" and the following comments were made:

Neither [the original nor secondary references] provide[s] any teaching at all of the sheets being devoid of adhesive extending along the end edges thereof between longitudinal lines of weakness. *** If the end edges of [the original prior art reference] were not sealed the likelihood is that the inserts or canceled checks [inserted into its mailer] would fall out.

The claims were then allowed.

The accused SRC form has a row of 10 widely-spaced circular patches of adhesive with a diameter of 3/16 inch extending along the end edge of the sheet between the longitudinal perforation lines. The patches cover more than 25% of the linear distance between the two perforation lines, and are spaced more than a 1/2 inch away from each other. Upon folding, the adhesive patches tack the mailer closed along its end edge.

The Eastern District noted that the term "devoid" is commonly defined in dictionaries to mean "[c]ompletely lacking; destitute; empty; without." In view of this definition, the lower court held that the circular adhesive patches in the accused SRC form dictated a finding of no literal infringement. Due to the amendments specifying that the sheet was "devoid of adhesive extending along said edges of said sheet" to distinguish the original prior art reference, the lower court likewise found no infringement under the DOE because of prosecution history estoppel ("PHE").

The Federal Circuit's Analysis

The ‘464 Patent

The Federal Circuit rejected Moore's arguments that the "majority of the lengths" limitation (i) simply involves a "matter of degree, not structure," and (ii) is analogous to the "pH from approximately 6.0 to 9.0" limitation at issue in Warner-Jenkinson Co. v. Hilton Davis Chem. Co., 520 U.S. 17 (1997). Specifically, Moore argued that the "majority of the lengths" limitation is entitled to a scope of equivalents covering a minority of the lengths because (iii) SRC knew of and copied the ‘464 patent in developing its accused form, citing Graver Tank & Mfg. Co. v. Linde Air Prods. Co., 339 U.S. 605, 85 USPQ 328 (1950), (iv) of a hypothetical claim analysis under Wilson Sporting Goods Co. v. David Geoffrey & Assocs., 904 F.2d 677, 14 USPQ2d 1942 (Fed. Cir. 1990), and (v) of the presence of a genuine issue of material fact as to whether "about 48%" is equivalent to "50.001%."

The Federal Circuit started out by stating that "[i]f our case law on the DOE makes anything clear, it is that all claim limitations are not entitled to an equal scope of equivalents." In particular, the Court remarked that "many limitations warrant little, if any, range of equivalents": (a) "[w]hether the result of the All Limitations Rule" of Pennwalt Corp. v. Durand-Wayland, Inc., 833 F.2d 931, 934,35, 4 USPQ2d 1737, 1739-40 (Fed. Cir. 1987) (en banc); (b) whether because of application of PHE under Warner-Jenkinson, 520 U.S. at 33-34; or (c) whether due to the "inherent narrowness of the claim language" itself under Sage, 126 F.3d at 1425, 44 USPQ2d at 11. Thus, the Federal Circuit's adoption of the undisputed "minority" (47.8%) to be equivalent to a "majority" "would vitiate the requirement that the ‘... strips of adhesive ... extend the majority of the lengths ...." Stated succinctly, "[i]f the minority could be equivalent to a majority, this limitation would hardly be necessary [and, moreover,] ... it would defy logic to conclude that a minority -- the very antithesis of a majority -- could be insubstantially different from a claim limitation requiring a majority, and no reasonable juror could find otherwise."

Relative to a hypothetical claims analysis, the Court referenced its earlier opinion in Streamfeeder, LLC v. Sure-Feed Sys., Inc., 175 F.3d 974, 983, 50 USPQ2d 1515, 1521 (Fed. Cir. 2000) to emphasize that such an analysis "is not an unbounded inquiry into the relevant scope of equivalents ... Such an analysis is not divorced from the claim language, but rather must be anchored in the limitation for which a range of equivalents is sought." In particular, the Court found that "[a] hypothetical claim analysis cannot operate to the exclusion of the doctrine of PHE or the All Limitations Rule."

The argument under Graver Tank was given the back of the Court's hand in its statement that Warner-Jenkinson "implies the exact opposite by rejecting the relevance of the alleged infringer's intent upon the DOE." The argument has relevance "only in the context of known interchangeability of substitutes for a claim limitation." Concerning equivalence vis-a-vis the ‘464 patent specification, the Court relied upon Maxwell v. J. Baker, Inc., 86 F.3d 1098, 39 USPQ2d 1001 (Fed. Cir. 1996) to restate the "contrary principle that ‘the subject matter disclosed in the specification, but not claimed, is dedicated to the public' in determining infringement under the DOE." Thus, having fully disclosed two distinct embodiments, i.e., one in which the adhesive strips extend a "majority of the lengths," and one in which they do not, "Moore is not entitled to ‘enforce the unclaimed embodiment as an equivalent of the one that was claimed," citing YBM Magnex, Inc. v. International Trade Comm'n, 145 F.3d 1317, 1320, 46 USPQ2d 1843, 1845 (Fed. Cir. 1998).

The Federal Circuit also rejected arguments concerning Sanitary Refrigerator relative to the rearrangement of claim limitations. "While Sanitary Refrigeratorundisputedly refers to ‘reciprocal changes,' it nowhere authorizes the rearrangement of claim limitations." Thus, Sanitary Refrigerator"concerned the typical DOE scenario in which the alleged infringer substitutes insubstantially different elements for the claim limitations." As a result, it clearly does not conflict with the Court's holding in Sage where an "issued patent contains clear structural limitations, the public has a right to rely on those limits in conducting its business activities," and the DOE does not apply. This is supported further by the lack of any discussion in Sanitary Refrigerator of the All Limitations Rule, the vitality of which was "more recently confirmed" in Warner-Jenkinson. In this case, allowing the rearrangement argued by Moore must not "effectively vitiate [an] element in its entirety."

The ‘798 Patent

The "Distance Sufficient" Limitation

The Federal Circuit agreed with Moore's arguments that the lower court improperly imported a limitation from the written description (and the title) of the ‘798 patent into its patent claims, relative to application of the "distance sufficient" limitation, only to the IBM 3800 printer, but found nonetheless "harmless error" in this regard. As noted by the Court, "there is nothing wrong with defining the dimensions of a device in terms of the environment in which it is to be used," citing Orthokinetics, Inc. v. Safety Travel Chairs, Inc., 806 F.2d 1565, 1575-76, 1 USPQ2d 1081, 1087-88 (Fed. Cir. 1986). However, the Federal Circuit affirmed the non-infringement finding because Moore failed to "provide any evidence demonstrating or even suggesting SRC's use of any printer other than the IBM 3800 ...."

In this latter regard, Moore's proffered declarations were found insufficient as merely offering conclusory statements, and lacking "any quantitative description of the increase in the relevant spacing dimension" of Moore's adhesive on its forms to reduce printing problems. Thus, Moore offered "nothing to rebut SRC's claim that its adhesive avoids interference with the rollers of the IBM 3800 printer not as a result of its spacing from the transverse edge, but rather due to its superior composition.

The ‘110 Patent

The "Devoid Of Adhesive" Limitation

The Federal Circuit relied upon the original prior art reference used to reject the ‘110 patent claims, and the fact that the reference discloses adhesive strips which need not be " ‘substantially complete,' but [which] can in fact be intermittent," to reject Moore's proffered claim construction arguments. Further, the Court made reference to Moore's rebuttal arguments vis-a-vis the original reference that removal of adhesive from its end edges would not permit its "remaining edges ... [to] perform the same function as before." The Court construed this argument to refer to the removal of all the adhesive, not to merely portions of the adhesive. The Federal Circuit looked further to the plain language of the claims (which does not limit the "devoid of adhesive" limitation to only "one face or only one edge") concerning the longitudinal lines of weakness, since (i) the relevant claims refer to the sheet as having "opposite end edges" (plural), and (ii) the written description of the ‘110 patent suggests the contrary -- "since all of its figures depict a [business] form with no adhesive along anyof the four end edges between the longitudinal lines of weakness." Emphasis in the original.

DOE Infringement

The Court relied upon PHE to uphold the lower court's finding of no DOE infringement because Moore argued before the PTO that it was "advantageous not to secure the edge with adhesive." Thus, the Federal Circuit found that the prosecution history makes clear that the absence of "any adhesive, not some adhesive, was necessary to secure the allowance of the claims. Consequently, Moore is not entitled to a scope of equivalents that would cover a form possessing adhesive along on of its end edges." Emphasis in the original. And, Moore's reliance upon a hypothetical claim analysis was similarly rejected -- "given that PHE trumps such an analysis where both are applicable." ("The presence of a feature in an accused device (here, adhesive) cannot possibly be equivalent to the claimed absence of that feature, and no reasonable fact finder could conclude otherwise").

Evidentiary Matters

Moore also complained that the lower court's grant of SJ was premature in view of Moore's Fed. R. Civ. P. 56(f) opposition declarations. In particular, Moore contended that it was critical for it to obtain certain allegedly infringing business forms from SRC to successfully oppose the SJ motions. Further, Moore complained that the parties had not taken a single deposition, SRC had not provided Moore with a single copy of any document, over four months of discovery remained at the time of the lower court's final grant of SJ, and that SRC had not responded fully to Moore's interrogatories. And, finally, Moore sought to supplement the appeal record before the Court with evidence concerning another SRC business form which allegedly infringed the ‘464 patent. Each of these arguments was rejected by the Federal Circuit.

Generally, the Court was extremely complimentary of the lower court -- noting that it "should be applauded for [its] expedient handling of this case." As to the Rule 56(f) declarations, the Federal Circuit considered them as " ‘fishing expeditions' in hopes of finding products that might be ‘infringing' to oppose summary judgment" because they did not indicate how additional discovery would enable Moore to create a genuine issue of material fact regarding SRC's alleged infringement. This conclusion was aided considerably by SRC's argument that Moore's counsel had been allowed to inspect all the accused SRC forms at SRC's headquarters, and that the accused SRC forms were publicly available.

Concerning Moore's request to supplement the appellate record, the Court noted that, not only is the record on appeal "generally limited to that which was before the district court," Moore offered no "reasonable basis for its failure to produce the proffered evidence at an earlier time" -- especially since Moore had to concede that its allegedly new infringement evidence "had been made available to it [by SRC] for inspection while litigation was ongoing" before the Eastern District. In fact, Moore had to admit that the "new" evidence actually was in its possession "even before it initiated this lawsuit against SRC."

Summary Of The Majority Panel Opinion

The panel majority explained that there are three fundamental limitations under the DOE. According to the Court:

Whether the result of the All Elements Rules, PHE, or the inherent narrowness of the claim language, many limitations warrant little, if any, range of equivalents.

Citations omitted.

Additionally, the Court held that even where an accused product has all the elements of a claim, but has rearranged those elements so that they ave not interrelated in the same way as the claimed elements, as a matter of law, there can be no infringement under the DOE.

Finally, the case clarifies the pitfalls facing claim drafters who do not use their imagination in drafting claims to "foresee" alternative embodiments. It also emphasizes the need to have claims that cover every embodiment disclosed.

Concurring/Dissenting Opinion of Judge Newman

Judge Newman concurred in the judgment of non-infringement with respect to the ‘798 patent, the ‘110 patent, and certain claims of the ‘464 patent. However, she did not share the Court's reasoning with respect to either the ‘798 or the ‘464 patents. For other claims of the ‘464 patent, the Judge would reverse the SJ and remand for determination of infringement on the correct law.

The ‘798 Patent

Judge Newman did not agree with the panel majority's claim construction that the ‘798 claims are not limited to the IBM 3800 printer and the adhesive distances described in the ‘798 specification, because "[d]espite their rejection of the [lower] court's claim construction," the majority seems to have interpreted the claims differently "for purposes of claim construction" and "for the purpose of this action" for infringement. The Judge called this a "new and confusing ruling" since "[e]xtensive precedent requires that claims be construed the same way for all purposes."

The ‘464 Patent

Judge Newman felt that whether 47.8% is equivalent to a majority is a question of fact which "could not be decided adversely to the patentee as a matter of law [because t]he evidence of identity of function, way, and result, and of insubstantial difference, was not disputed on SJ; the question requires findings of fact, not summary disposition." The Judge also did not agree that Moore dedicated to the public all embodiments less than the "majority of the lengths" because "[n]either PHE nor prior art was asserted as limiting equivalency to over 50% of the length."

Judge Newman further did not agree with the panel majority ruling that the DOE can not be invoked to reach rearranged claim elements, as a matter law since "[t]he Federal Circuit in Corning Glass Works v. Sumitomo Electric USA, Inc., 868 F.2d 1251, 9 USPQ2d 1962 (Fed. Cir. 1989) recognized equivalency involving rearranged elements."