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Conflicting Record on DOE Waiver Triggers Reconsideration and Remand

February 17, 2004

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Last Month at the Federal Circuit - March 2004

Judges: Linn (author), Lourie, and Gajarsa

In Sulzer Textile A.G. v. Picanol N.V., No. 02- 1410 (Fed. Cir. Feb. 17, 2004), the Federal Circuit granted a petition for panel rehearing and modified an earlier opinion (“Sulzer I”) by vacating and remanding the district court’s motion in limine (“MIL”) in view of Festo for a determination of whether Sulzer Textile A.G. (“Sulzer”) waived the DOE defense, and, if not, whether Sulzer is estopped from arguing the DOE.

The Federal Circuit’s Sulzer I opinion and the facts of the case were reported in the January 2004 issue of Last Month at the Federal Circuit. After the Sulzer I decision, Picanol N.V. (“Picanol”) filed a petition for panel rehearing, arguing that the Federal Circuit’s determination that Sulzer had not waived recourse to the DOE was incorrect based on the record before the district court. Upon reviewing the papers filed by both Sulzer and Picanol, the Federal Circuit discovered that the parties had failed to disclose certain facts, including material differences between the district court’s nonfinal pretrial order and the final one. As a result, the Federal Circuit granted Picanol’s petition and agreed to reexamine whether Sulzer’s failure to argue infringement under the DOE was a waiver. Thus, in the instant opinion, the Federal Circuit modified Sulzer I solely with respect to the district court’s decision on the MIL preventing Sulzer from arguing infringement under the DOE.

Picanol argued that Sulzer failed to raise equivalents during its case-in-chief based on trial strategy rather than the district court’s evidentiary order, and, therefore, waived its right to appeal under the DOE. As evidence, Picanol pointed out that the district court’s MIL order did not issue until one day before the close of evidence. By comparison, Sulzer argued that it did not present evidence of infringement under the DOE because, prior to trial, the district court, in an off-the-record communication, informed Sulzer that it would be precluded from presenting evidence under the DOE.

The Federal Circuit examined the docket sheet from the trial and discovered that the pretrial conference did not mention a ruling on Picanol’s MIL. Further, in the Joint Final Pretrial Order, which was entered about a week before the close of evidence at trial, the MIL was listed as still pending, suggesting that the motion had not been decided prior to Sulzer’s case-in-chief. However, the Joint Final Pretrial Order showed that, unlike the draft Pretrial Order, the DOE was not listed as contested, suggesting that the MIL had been decided, thereby barring Sulzer from presenting evidence. Faced with these conflicting facts, the Federal Circuit determined that only the district court had sufficient facts to determine whether a waiver had occurred and ordered the issue remanded. The Federal Circuit further instructed the district court to determine, in view of Festo, whether Sulzer could overcome the presumption of prosecution history estoppel.