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Oral Testimony of Six Witnesses Fails to Prove Anticipating Public Use

01-1263
June 07, 2002
Parker, Aaron L.

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Last Month at the Federal Circuit - July 2002

Judges: Linn (author), Lourie, and Mayer (dissenting)

In Juicy Whip, Inc. v. Orange Bang, Inc., No. 01- 1263 (Fed. Cir. June 7, 2002), the Federal Circuit reversed the district court’s denial of the patent holder’s motions for JMOL on the issues of anticipation by prior public use and inequitable conduct, and remanded the case for a determination of damages.

Juicy Whip, Inc. (“Juicy Whip”) filed suit for patent infringement, alleging that Orange Bang, Inc. (“Orange Bang”) was making beverage dispensers that infringed Juicy Whip’s U.S. Patent No. 5,575,405 (“the ‘405 patent”). In response to the infringement charges, Orange Bang alleged unenforceability based on inequitable conduct and anticipation due to prior public use. Although a jury found that Orange Bang had willfully infringed claims 6 and 9 of the ‘405 patent, it also found that these claims were invalid under 35 U.S.C. § 102(b) based on prior public use and unenforceable for inequitable conduct. The district court denied Juicy Whip’s motions for JMOL and for a new trial and awarded costs to Orange Bang. Juicy Whip appealed.

The ‘405 patent relates to a postmix beverage dispenser that is designed to look like a premix beverage dispenser. During prosecution of the patent, the inventors submitted several declarations from experts in the beverage industry directed toward novelty, commercial success, and long-felt need of the patented invention. These declarations were from a former employee of an Orange Bang distributor owned by the inventors and a former Coca-Cola Company employee who later joined Juicy Whip. The patent issued in November 1996 based on a series of applications.

At trial, Orange Bang focused on the inventor’s letter and the two declarations as the basis for the claims that the ‘405 patent should be unenforceable due to inequitable conduct. The Federal Circuit found that Orange Bang had failed to provide substantial evidence necessary to show that Juicy Whip acted inequitably because none of the evidence met the threshold level of materiality or intent to mislead.

Concerning public use, the evidence consisted of testimony from six witnesses stating that Orange Bang’s owner had made and sold anticipatory beverage dispensers in 1983 and 1988. The witnesses testified that they had either seen or used the allegedly anticipatory beverage dispensers. The only other evidence was a sketch of the 1983 dispenser drawn by two witnesses during their depositions and a purchase order for acrylic bowls allegedly used in the 1988 dispenser.

The Federal Circuit clung to its precedent that oral testimony of prior public use must be corroborated to invalidate a patent. Finnegan Corp. v. Int’l Trade Comm’n, 180 F.3d 1354 (Fed. Cir. 1999). The Court reviewed the evidence and concluded that the record lacks substantial evidence regarding at least one limitation of each asserted claim, i.e., that a beverage bowl was the principal reservoir of the beverage being dispensed. The Court rejected the deposition sketch because it was not contemporaneous and found the purchase order incomplete because it did not address the claim limitations. Although the Court did not doubt the credibility of the six witnesses, it concluded that precedent cautioned it against relying on oral testimony alone. As such, the record evidence failed to meet the clear and convincing standard of proof on invalidity.

Judge Mayer dissented, stressing the importance of allowing the jury to act as fact finder without unwarranted second guessing by appellate courts.