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Case Remanded for Third Time

July 13, 2004

Decision icon Decision

Last Month at the Federal Circuit - August 2004

Judges: Rader (author), Michel, and Newman (dissenting)

In AFG Industries, Inc. v. Cardinal IG Co., No. 03-1078 (Fed. Cir. July 13, 2004), the Federal Circuit vacated a grant of SJ of noninfringement after construing a claim term and remanded the case for a third time.

U.S. Patent No. 4,858,532 (“the ‘532 patent”) to AFG Industries, Inc. (“AFG”) claims a transparent laminated product with a five-layer transparent coating composed of alternating zinc oxide and silver layers to assist in reducing heat transfer through the glass. Cardinal IG Company, Inc. (“Cardinal”) markets a glass product produced by sputter deposition that permits materials, like silver, zinc, and titanium, to be deposited on the surface in either alternating or successive layers.

In the first appeal, the Court vacated a SJ of noninfringement and directed the trial court to precisely determine the meaning of the claim term “layer.” In the second appeal, the Court again vacated SJ of noninfringement, found the trial court’s interpretation of the term “layer” erroneous, and specifically interpreted it to mean “a thickness of material of substantially uniform chemical composition, but excluding interlayers having a thickness not to substantially affect the optical properties of the coating.”

Now, on the third appeal and after stressing that a product claim covers the inventive structure regardless of how it is made, the Court considered (1) whether successive depositions of zinc oxide constituted one or multiple layers, and (2) whether the layer of titanium oxide that Cardinal’s process may also deposit constitutes a layer within the meaning of the ’532 patent.

Cardinal argued that its successive deposition of zinc oxide constituted 3 to 4.5 layers, not just one layer, and, thus, was outside the scope of the ‘532 patent. Citing 3M Innovative Properties Co. v. Avery Dennison Corp., 350 F.3d 1365 (Fed. Cir. 2003), the Court found this construction would impermissibly adopt a process limitation in a product claim. By considering the method through which the zinc oxide was applied, the lower court erred because it did not determine if successive depositions create a unitary structure with the same optical properties. Thus, those depositions may or may not be multiple “layers,” as the Court previously defined the term. In addition, evidence in the form of both internal Cardinal documents and analytical testing showed that successive depositions may in fact form a single layer. As such, a genuine issue of material fact existed that precluded the entry of SJ.

The Court also vacated SJ on the alternative basis that the titanium dioxide present in some of Cardinal’s products may not constitute a “layer.” Even though it noted that “composed of” excludes only “ingredients that would materially affect the basic and novel characteristics of the claimed composition,” the Court found persuasive that not all of Cardinal’s accused products actually contain titanium dioxide. Further, the Courtcited AFG’s own expert testimony to support an argument that titanium deposition may affect the optical properties of the coating and thus be a “layer.” Because the record did not show incontrovertible evidence that the titanium dioxide was not a “layer,” the Court remanded for further analysis.

Judge Newman dissented, finding the meaning of “layer” to be “a relatively simple technical question” and the record sufficiently developed to end the eight years of ongoing litigation.