Print PDF

Inventor Not Permitted to Change Deposition Testimony Invalidating Patent Under On-Sale Bar

March 11, 2010

Decision icon Decision

Last Month at the Federal Circuit - April 2010

Judges: Bryson, Linn, Prost (author)

[Appealed from: S.D. Fla., Judge Jordan]

In Delaware Valley Floral Group, Inc. v. Shaw Rose Nets, LLC, No. 09-1357 (Fed. Cir. Mar. 11, 2010), the Federal Circuit affirmed the district court’s grant of SJ of invalidity pursuant to the on-sale bar under 35 U.S.C. § 102(b).  The Court found no abuse of discretion in the district court’s refusal to consider errata sheets and declarations offered by Shaw Rose Nets, LLC and Kenneth P. Shaw (collectively “Shaw”) or in the denial of Shaw’s motion for reconsideration.

Mr. Shaw is the inventor of and owns U.S. Patent No. 5,765,305 (“the ’305 patent”), which describes a process that produces larger rose buds by putting elastic, porous nets over the rose heads as they grow.  The application for the ’305 patent was filed in January 1996.

In answers to interrogatories from Delaware Valley Floral Group, Inc. (“DVFG”), Mr. Shaw averred that he invented and first offered to sell a product using the patented process in 1995.  Less than a month later, he testified eighteen times in a deposition that he invented the process described and claimed in the ’305 patent in 1994.  Mr. Shaw explained that the interrogatory answer had been a typographical error.  He then testified that he and his colleagues “ironed out all the wrinkles” and started commercially exporting roses grown with the patented process in September 1994.  Slip op. at 3-4. 

Based on this testimony, DVFG served a motion for sanctions under Fed. R. Civ. P. 11, asserting that the ’305 patent was invalid based on the on-sale bar under 35 U.S.C. § 102(b).  Mr. Shaw attempted to alter his deposition testimony to say that the date of invention and commercial sales was 1995 rather than 1994.  The district court excluded the errata sheet as untimely under Fed. R. Civ. P. 30 and because Mr. Shaw “is a seasoned deponent” and had not equivocated during his deposition.  Id. at 5.   The district court also excluded two declarations that Mr. Shaw sought to introduce to create genuine issues of material fact.  Ultimately, the district court granted SJ of invalidity in favor of DVFG, citing the on-sale bar.

On appeal, the Federal Circuit considered whether genuine issues of material fact precluded SJ based on the on-sale bar.  Specifically, the Court considered whether the district court abused its discretion under Eleventh Circuit law in excluding the errata sheet and declarations.  First considering the errata sheet, the Court found that the “Eleventh Circuit has not determined whether Rule 30(e) ever allows for substantive changes to deposition testimony through an errata sheet.”  Id. at 10 (citing Cultivos Yadran S.A. v. Rodriguez, 258 F.R.D. 530, 532 (S.D. Fla. 2009)).  The Federal Circuit also found Mr. Shaw’s errata sheet untimely in light of the thirty-day period provided by Rule 30(e).  Accordingly, the Court found no abuse of discretion in the exclusion of the errata sheet.

Turning to Mr. Shaw’s declaration, the Federal Circuit concluded that “that affidavit would be a sham” under Eleventh Circuit law.  Id. at 11 (citing McCormick v. City of Fort Lauderdale, 333 F.3d 1234, 1240 n.7 (11th Cir. 2003)).  The Court found that Mr. Shaw’s effort to show his testimony was in error is “severely undermined by his purported explanation for his inconsistency” and concluded that Mr. Shaw only offered the declaration to create a genuine issue of material fact.  Id. at 12. 

With respect to the declaration of one of Mr. Shaw’s employees, the Federal Circuit agreed with the district court that the declaration cannot be used to create a genuine issue of material fact that would preclude SJ because it was not based on personal knowledge, which Fed. R. Civ. P. 56(e) and the Eleventh Circuit require.  Thus, the Court found no abuse of the district court’s discretion in excluding the declarations.

The Court also considered Shaw’s argument that there is a genuine issue of material fact regarding whether the process was ready for patenting at the time of the offer to sell.  The Court concluded that Shaw failed to contest in the district court whether the invention was ready for patenting and, thus, the argument was waived.   

The second question on appeal was whether the district court abused its discretion in denying Shaw’s motion for reconsideration.  The three primary grounds that justify reconsideration are (1) an intervening change in the controlling law; (2) the availability of new evidence; and (3) the need to correct clear error or prevent manifest injustice.  Id. at 16 (citing Degirmenci v. Sapphire-Fort Lauderdale, LLLP, 642 F. Supp. 2d 1344, 1353 (S.D. Fla. 2009)).  The Eleventh Circuit has held that a court should not grant a motion to reconsider absent some showing that the evidence was not available during the pendency of the motion.  Id. (citing Shuford v. Fid. Nat’l Prop. & Cas. Ins. Co., 508 F.3d 1337, 1345 (11th Cir. 2007)).

According to Shaw, the district court erred in failing to consider its “newly-discovered evidence,” namely, declarations from a Shaw employee and from the patentee’s personal assistant in Ecuador, which corroborate the patent owner’s corrected deposition testimony and thus create a genuine issue of material fact regarding when the patented process was ready for patenting.  On appeal, Shaw conceded that the personal assistant’s testimony was not newly discovered evidence.  With respect to the employee’s testimony, however, the record indicated that such testimony was not available during the pendency of the motion only because Shaw made no effort to locate the employee prior to entry of SJ.  Under these circumstances, the Court concluded that the district court did not abuse its discretion.

Finally, the Court rejected Shaw’s “half-hearted argument” that manifest injustice requires reconsideration.  Id. at 17.  The Court reminded that a motion for reconsideration is appropriate only where the Court has patently misunderstood a party, or has made a decision outside of the adversarial issues presented to the Court by the parties, or has made an error not of reasoning, but of apprehension.  “Such problems rarely arise and the motion to reconsider should be equally rare.”  Id. (quoting Ass’n for Disabled Ams., Inc. v. Amoco Oil Co., 211 F.R.D. 457, 477 (S.D. Fla. 2002)).  The Court held that Shaw made no such showing.


Summary authored by Uttam G. Dubal, Esq.