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District Court Failed to Construe Claims and Improperly Concentrated on “Heart of the Invention”

August 01, 2002

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Last Month at the Federal Circuit - September 2002

Judges: Linn (author), Gajarsa, and Prost

In Allen Engineering Corp. v. Bartell Industries, Inc., No. 01-1238 (Fed. Cir. Aug. 1, 2002), the Federal Circuit affirmed-in-part, reversed-in-part, vacated-inpart, and remanded the district court’s judgment regarding validity, infringement, and damages of U.S. Patent No. 5,108,220 (“the ’220 patent”). The Federal Circuit found numerous errors in the district court’s judgment and criticized both counsel for their conduct during the case.

Allen Engineering Corporation (“Allen”) is the assignee of the ‘220 patent that relates to concrete riding trowels. Allen alleged that Bartell Industries, Inc.’s (“Bartell”) manufacture and sale of its Bartell #1 and Bartell #2 models infringed claims 1-4, 6-9, and 13-24 of the ’220 patent.

After a bench trial, the district court had found that the Bartell #1 trowel literally infringed claims 15- 19, and possibly other claims, and that the Bartell #2 trowel infringed unspecified claims of the ‘220 patent under the DOE. The district court rejected Bartell’s contention that the ’220 patent claims were subject to an on-sale bar and that Allen committed inequitable conduct by not disclosing information regarding a product of Allen’s to the PTO during prosecution of the ’220 patent. Finally, the district court rejected Bartell’s argument that damages could not be awarded because one of Allen’s products, which was allegedly covered by the claims of the ’220 patent, bore erroneous marking stickers that did not provide effective notice of the patent numbers to the public.

On appeal, the Federal Circuit found numerous errors in the district court’s judgment. For example, the district court had not construed the claims, commenting instead on a single limitation that it considered the “heart” of the invention. The Federal Circuit emphasized that the test for infringement does not rely upon a protected “essential element,” “gist” or “heart” of the invention. Such tests were long ago rejected.

In regard to the finding of infringement under the DOE, the Federal Circuit noted that the district court had failed to perform a limitation-by-limitation comparison, and even failed to identify which claim or claims were infringed. The Federal Circuit then proceeded to provide detailed guidance on specific issues that, among others, would have to be addressed on remand by the district court regarding claim construction and infringement, both literally and under the DOE.

The Federal Circuit also found that several claims of the ‘220 patent were invalid for failing to meet the requirements of 35 U.S.C. § 112, ¶ 2. For example, one claim included a truncated limitation. Other claims used a phrase that was admittedly at odds with the specification. The Court ruled that these claims did not accurately set forth what the patentee regarded as his invention.

The Federal Circuit found that the district court had erred in concluding that sales of certain models by Allen did not trigger an on-sale bar. The district court had found these sales to be experimental and, thus, did not trigger an on-sale bar. However, the Federal Circuit found that the district court had incorrectly analyzed whether these sales were for experimental use. The Court noted that experimental use is based on a question of whether the primary purpose of the inventor at the time of the sale, as determined from an objective evaluation of the facts surrounding the transaction, was to conduct experimentation.

The Federal Circuit did agree with the district court on the inequitable-conduct issue. Bartell argued that Allen’s intent to deceive the PTO was shown by its gross negligence in failing to disclose sales of one of Allen’s own products during prosecution. However, even if Allen’s conduct amounted to gross negligence, the Court found that this alone would not be sufficient to show the requisite intent for inequitable conduct.

The Federal Circuit also affirmed the district court’s holding that Allen had effectively marked its products. At trial, Bartlett argued that a typographical error in the markings of Allen’s products rendered them ineffective. The Federal Circuit found the error to be a manifestly obvious typographical error in the placement of a semicolon, but that would not prevent interested members of the public from discerning the patent numbers.