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Party Cannot Argue About Inconsistent Verdicts Inconsistently

August 30, 2002

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Last Month at the Federal Circuit - September 2002

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

In Minnesota Mining & Manufacturing Co. v. Chemque, Inc., No. 00-1429 (Fed. Cir. Aug. 30, 2002), the Federal Circuit affirmed-in-part, reversedin- part, and remanded the district court’s judgment in favor of Chemque, Inc. (“Chemque”), following a jury’s verdict that Chemque does not infringe Minnesota Mining and Manufacturing Company’s (“3M”) U.S. Patent No. 5,169,716 (“the ‘716 patent”) and that the ‘716 patent is invalid.

The ‘716 patent is directed to a composition of encapsulants used to protect signal transmission devices, such as optical cables, from contamination. A signal transmission device is encompassed in a mixture of the two ingredients that comprise the encapsulant. When the components are mixed, they form a gel-like polymer structure that protects the transmission device.

3M brought suit against both Chemque, Inc. and Thomas & Betts Corporation (“T&B”), alleging infringement of claims 1 and 9 of the ‘716 patent. Both Defendants asserted that the claims were invalid under several provisions of 35 U.S.C. § 102. The case was tried to a jury. Before the jury reached a verdict, however, 3M moved for JMOL on Defendants’ invalidity defenses, which the district court denied. The jury returned a special verdict finding no infringement of independent claim 1 but infringement of dependent claim 9. Further, the jury found that independent claim 1 was not anticipated but that dependent claim 9 was anticipated.

After the jury’s verdict was entered, 3M made a motion for JMOL with respect to the validity of dependent claim 9 and moved for a new trial due to the inconsistencies in the jury’s verdict. With respect to the issue of infringement, Defendants argued that the jury’s verdicts were inconsistent in that a dependent claim could not be infringed if the independent claim from which it depends is not infringed. However, with respect to the issue of anticipation, Defendants argued that the jury’s findings were not inconsistent and the court should affirm the jury’s finding that dependent claim 9 was invalid. The district court concluded that the verdicts were not inconsistent and entered judgment in favor of Defendants.

3M limited its appeal to the issues of whether claim 9 was anticipated and whether Chemque had induced infringement. Defendants challenged the jury’s finding that claim 9 was infringed and the district court’s claim construction.

The Federal Circuit first addressed the jury’s inconsistent findings with respect to both infringement and invalidity and ruled that the Defendants were judicially estopped from arguing that the jury’s findings were inconsistent because they had expressly argued against a finding of inconsistency at the district court level. In this case, the Court found that the law of the Fifth Circuit warranted a finding of judicial estoppel with respect to the Defendants. Therefore, the Court adopted the jury’s finding that the Defendants had infringed claim 9 of the ‘716 patent.

The Court next turned to the question of whether Chemque had induced infringement of claim 9 as well. The Court concluded that the evidence indicated that Chemque was aware of the 3M patents and supplied the infringing products to T&B and other customers with instructions on how they were to be used, which, when followed, would lead to infringement.

Lastly, the Court turned its attention to the jury’s finding that claim 9 of the ‘716 patent was invalid under 35 U.S.C. § 102. The Court first noted that neither the jury nor the parties themselves were clear about which section of 35 U.S.C. § 102 the jury had relied on in its finding of “anticipation.” As a result, the Court treated the issue by examining all possible bases for invalidity under that section. After examining several key references, the Court held that there was insufficient evidence to overcome the statutory presumption of validity of the claim. As a result, the Court found in favor of 3M, reversing the district court’s refusal to enter JMOL on the issue.

Chief Judge Mayer dissented because he would have affirmed the jury’s determination of invalidity.