Petition — Burroughs Corp. v. A. B. Dick Co.

Oitice ~ Say Court, U.

838-698 | Fitro”

OCT 25 1983

~ a ninndiniemeremenamamenss

CLERK

In THE

Supreme Court of the United States

OCTOBER TERM, 1983

7 *

v

BURROUGHS CORPORATION,

Petitioner,

vs.

A. B. DICK COMPANY,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

CuHarLes W. Brapiey

(Counsel of Record)

Steven D. Gazer

Davis Hoxie FarrHFuLu

and Hapcoop

45 Rockefeller Plaza

New York, New York 10111

(212) 757-2200

Attorneys for Petitioner,

Burroughs Corporaiion

Of Counsel:

Kevin R. Peterson

Epmunp M. Cuune

Burroughs Corporation

Burroughs Place

Detroit, Michigan 48232

(313) 972-7982

Questions Presented

1. Whether a patent owner, having had a full and

fair opportunity to litigate the scope of his patent, and

having obtained a trial and final resolution of that issue,

should be entitled to relitigate the same issue in subsequent

litigation ;

2. Whether our overcrowded courts can long endure,

and the industrial community can plot its course, under

a rule of law that permits the scope of a patent, once

litigated and determined by a final judgment, to be re-

litigated again and again; and

3. Whether a ‘‘case or controversy’’ under Article III

of the Constitution is presented by a dispute over the scope

of a patent, irrespective of the presence of the issues of

validity and infringement.

Parties Below

The plaintiff in this case is A. B. Dick Company, a

Delaware corporation. The defendant is Burroughs Cor-

poration, a Michigan corporation.

Pursuant to Rule 28.1 of this Court, Petitioner Bur-

roughs Corporation states that it has no parent companies,

and that it has the following subsidiaries and affiliates

(other than wholly owned subsidiaries): Tata Burroughs

Ltd. (India); Memorex Japan Ltd.; Societe de Location

et d’Entretien Machines Electroniques (France); Disk

Media Ine. (Cal.); Memorex DIC Corp. (Cal.) ; Peripheral

Components Inc. (Del.); Japan Softee Co. Ltd. (Japan) ;

Teijin Memorex Company Ltd. (Japan); and SDC (1981)

Limited (U.K.).

TABLE OF CONTENTS

NN os wh an ah cede s cabuevaceews

Parties Below . Signe. Dui et KE pan ey AS SR GL yee eR

Opinions of the Courts Below ...............0000.

IEG ES SL SORTS 9 cst PN Cone eae SRR

ET RN es a een ey RAGE A Baar oe

Reasons for Granting the Writ ...............04--

IL.

Il.

ITT.

IV.

The CAFC Ruling, in this Case, on the Basically

Important Question of the Scope of a Patent,

Is Directly Contrary to this Court’s Collateral

Estoppel Rulings over the Past Decade ......

There Is No Unfairness in According Collateral

Estoppel Effect to Final Determinations of Pat-

i MN is a6 on baU bake bbicuwneae's becouse pee

The CAFC Ruling Raises Unacceptable Social

and Economic Consequences ..........++++++

The CAFC Has Abrogated The Role of the

Federal Courts in Determining the Basically

Important Question of the Scope of a Patent ..

ee reat) OF rere Ft aa SRA Si a en

Appendix

A Opinion of the United States District

Court for the Southern District of Ohio in

Mead Digital Systems, Inc. v. A. B. Dick

Company (August 7, 1981), reported at 521

NS UE tek Vc kbevedanee be cotebestan

we Pr

or

TABLE OF OONTENTS

Mead’s Opposition to Motion for Entry of

Final Judgment In Form Proposed by

PROS Sintercesccdncéuacesapuené pee

Memorandum in Reply to Mead’s Opposi-

tion to Plaintiff's Motion for Entry of

Final Judgment in Form Proposed by

DREN. vos cde vew uns: oResmel Mua eke ae

Letter from Judge Walter H. Rice to

counsel for parties in Mead Digital Sys-

tems v. A. B. Dick Company and A. B.

Dick Company v. The Mead Corporation,

FeRORSy TG, TUGE) o 56 vip kd pecnctcvebuces

Final Judgment of the United States Dis-

trict Court of the Southern District of

Ohio in Mead Digital Systems, Inc. v. A. B.

Dick Company (January 26, 1982) .......

Memorandum Opinion and Order of the

United States District Court for the

Northern District of Illinois in A. B. Dick

Company and Goud, Inc. v. Burroughs

Corporation (November 5, 1982), reported

ot ie FO: TOG viwccdadaakkesneeees

Opinion of the Court of Appeals for the

Federal Circuit in A. B. Dick Company v.

Burroughs Corporation (July 27, 1983), re-

SNE GE TAS An FOU s ctceconcecewareeuss

PAGE

A65

A73

A79

A82

A87

TaBLe oF AUTHORITIES Vv

Cases PAGE

A. B. Dick Co. v. Burroughs Corp., 550 F. Supp. 1065

TEE GbTUSE 5 inn ox'awderceadedeacesd 1

A. B. Dick Co. v. Burroughs Corp., 713 F.2d 700 (Fed.

eS eh ead oh ly aebbevedecetacend 1

Abbott Laboratories v. Gardner, 387 U.S. 136 (1967) 12

Aetna Life Ins. Co. v. Haworth, 300 U.S. 227

(BIBT) cccccese sectovesees ET Re eee 12,14

Allen v. McCurry, 449 U.S. 90 (1980) .............. 5, 6

Blonder-Tongue v. University Foundation, 402 U.S.

in Nei bauwedne edad tonshes 5, 6, 8, 11, 13

Blumcraft of Pittsburg v. Kawaneer Company, Inc.,

ey ee ee (Oe Ole, 1978)... 26. ccccccecss 9

Bowsher v. Merck & Co., 103 S. Ct. 1587 (1983) .... 12

Carbice Corp. v. American Patents Corp., 283 U.S.

tsa e awe adele bh kde aueaenee hos 13

Dawson Chemical Co. v. Rohm & Haas Co., 448 U.S.

a ern ce ib w nda Cet ives eedbeeens 13

Ethyl Gasoline Corp. v. United States, 309 U.S. 436

A REL Sapo Sa naneess ov 6idd heene’s 13

Iron Ore Co. of Canada vy. Dow Chemical Co., 177

USPQ 34 (D. Utah 1972), aff’d, 500 F.2d 189

SE ESOS Ret eile pay g

Kaiser Industrial Corp. v. Jones & Laughlin Steel

Corp., 515 F.2d 964 (3d Cir. 1975), cert. denied,

EE Scand keen tenuss déenese-<ss 9

Lear, Inc, v. Adkins, 395° U.S. 653 (1969) ..........- 13

Leitch Mfg. Co. v. Barber Co., 302 U.S. 458 (1938) 13

Maryland Casualty Co. v. Pacific Co., 312 U.S. 27

SSSA cal pSUUhabubeseserseads Breet 13, 14

vi TABLE OF AUTHORITIES

PAGE

Mead Digital Systems, Inc. v. A.B. Dick Co., 521

F.Supp. 164 (S.D. Ohio RGR REE ers 1, 2, 3, 4, 7,

8, 9,10

Mercoid Corp. v. Mid-Continent Co., 320 U.S. 661

RE adele Cocca Aus nsieuanab eked A caer 13

Molinaro v. Hart Electronics Corp., 212 USPQ 697

oe a ae ee vege cae reein Salt: 8

Molinaro v. Sears, Roebuck & Co., 478 F. Supp. 818

SNC NED F sSdvbosbsbstcsucgpscas@sseneus 8

Montana v. United States, 440° U.S. 147 (1979) ..... 5,6, 8

Montana v. United States, 450 U.S. 544 (1981) ..... 12

Morton Salt Co. v. Suppiger Co., 314 U.S. 488 (1942) 13

Motion Picture Co. v. Universal Film Co., 243 U.S.

502 (1917) Tha GL davh cwiteur ete d dkwadane dkie 13

North Dakota v. United States, 103 S. Ct. 1095 (1983) 12

North Haven Board of Education v. Bell, 456 U.S. 512

GEG i vivhntcudccduhdaseenletatsuaweenwnaant 12

Parklane Hostery Co. v. Shore, 439 U.S. 322 (1979) 5, 6,9

Precision Co. v. Automotive Co., 324 U.S. 806 (1945) 13

- Radio Steel & Mfg. Co. v. MTD Products Inc., 566 F.

Supp. 609 (N.D. Ohio 1983) ............seeeee 6

Skelly Oil Co. v. Phillips Co., 339 U.S. 667 (1950)... 18

South Corp. v. United States, 690 F.2d 1368 (Fed. Cir.

Ns dT ehcbavhndiganes chien eek auces cna 6

Stoll v. Gottlieb, 305 U.S. 165 (1938)...........2.00. 9

Triplett v. Lowell, 297 U.S. 638 (1936) ............ 6

Underwriters Assur. Co. v. North Carolina Life, 455

EEE 2205s un, swans oesievess sexd 9

TABLE OF AUTHORITIES Vii

Union Carbide Corp. v. American Can Co., 558 F.

ee Ls RO es voce dn eda dele cds 6

United States v. California, 332 U.S. 19 (1947) .... 13

Westinghouse Co. v. Formica Co., 266 U.S. 342 (1924) 13

White v. Dunbar, 119 U.S. 47 (1886) .............. 13

Zenith Corp. v. Hazeltine, 395 U.S. 100 (1969) ..... 13

Constitution

SE EE Bod ca cad holga arene eccle ee iahad 2,12

United States Code, Title 28

CCeCiUab ci pas dedbacesatecdavedaee oe

rT A COP vicdewe sed badéatess shir adewe

ee cea eb as cathe sees sie beeen es

ee ee

8

D

on wonrnn ww

Other Authorities

Restatement Second of Judgments, Sec. 12 (1982) .. 9

18 Wright, Miller & Cooper, Federal Practice and

J Procedure, ae. GORD (IGGL) neo mnc nee vane nods 9

qe

In THE

Supreme Court of the United States

OCTOBER TERM, 1983

.*

vv

BURROUGHS CORPORATION,

Petitioner,

vs.

A. B. DICK COMPANY,

Respondent.

+

of

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

Petitioner, Burroughs Corporation, respectfully re-

quests that a writ of certiorari issue to review the judg-

ment entered in this case on July 27, 1983 by the United

States Court of Appeals for the Federal Circuit.

Opinions of the Courts Below

The opinion of the Court of Appeals for the Federal

Circuit is reported at 713 F.2d 700 (A 105). The opin-

ion of the District Court for the Northern District of

Illinois, Eastern Division, is reported at 550 F.Supp. 1065

(A 87).

The opinion of the District Court for the Southern

District of Ohio, in the related case of Mead Digital Sys-

tems, Inc. v. A. B. Dick Co., is reported at 521 F.Supp.

164 (A 1). The final judgment entered by the Mead court

(A 82), and the accompanying letter of Judge Rice (A 79),

are unreported.

Jurisdiction

The judgment of the Court of Appeals for the Federal

Circuit was entered on July 27, 1983. This petition is being

filed within ninety days of the entry of judgment. The

jurisdiction of this Court arises under 28 U.S.C. 1254 (1).

Constitutional Provision Involved

This case involves the following ‘‘case or controversy’’

provision of Article III, §2, cl. 1 of the United States

Constitution:

The judicial Power shall extend to all Cases, in Law

and Equity, arising under . . . the Laws of the United

States . . .;—to Controversies . . . between Citizens

of different States... .

Statement of the Case

This is a pa‘ent infringement suit. The A. B. Dick

Company sued Burroughs Corporation in the Northern

District of Illinois, Eastern Division, claiming tbat ink-

jet character printers manufactured by Burroughs in-

fringe U.S. patent 3,596,275, issued to Richard G. Sweet,

and a Lewis-Brown patent (not presently in issue).

District Court jurisdiction was based on 28 U.S.C. 1338

(a), 2201 and 2202.

The Sweet patent relates to an oscillographic recorder

which can directly record ink drops on paper to produce a

replica of the waveform of a continuously varying electri-

cal signal. ,

The Sweet patent is being asserted by A. B. Dick to

cover commercial ink-jet character printers.

In a prior suit against the Mead Corporation, after a

full trial on the merits, the Sweet patent was adjudged,

in a declaration appearing in a final judgment, to be

limited in scope to oscillographic recording (A 82). This

3

construction was based upon both the relevant prior art

and a file wrapper estoppel (A 12-15, 33, 59).

Iu the present suit, the District Court granted defend-

ant’s motion for summary judgment, finding that the

Mead court’s ruling on the Sweet patent’s scope is en-

titled to collateral estoppel effect, and that the undisputed

facts show that the accused Burroughs equipment does

not fall within that scope.

The Court of Appeals held that no collateral estoppel

can apply to a ruling on a patent’s scope unless that rul-

ing is essential to a ruling on validity or infringement,

and it cannot apply to products not before the first court.

It therefore reversed (A 117-18).

A. B. Dick-Mead Litigation

Shortly after the present suit was instituted, A. B. Dick

sued the Mead Corporation for patent infringement in

the same court, claiming that Mead’s ink-jet character

printers infringe both the Sweet patent and the Lewis-

Brown patent. Mead’s subsidiary, in turn, filed a de-

claratory judgment action in the Southern District of

Ohio, demanding a declaration as to the validity, scope

and infringement of the two patents. The Mead actions

were thereafter consolidated and tried in Ohio (A 11-12).

The Mead case went to trial on both the patent in-

fringement and declaratory judgment actions, after the

entry of a final pretrial order that included the following

issues to be tried:

**10.. What is the legal scope of the claims of the

Sweet patent?

* . * . . .

**12. Does the legal scope of the claims of the Sweet

patent define patentable subject matter in view of

prior art?

4

**13. Has the legal scope of the claims of the Sweet

patent been infringed by any product of Mead?’’

(A 68-9)

After an extensive trial and briefing, the District Court,

sitting without a jury, considered the prior art references,

as well as the file history of the Sweet application before

the Patent Office, and considerable other evidence, and

held the Sweet patent to be limited in scope, and not in-

fringed, but valid as so construed (A 79, 82).*

The final judgment of the District Court, in the Mead

suit, included the following specific declaration as to the

scope of the Sweet patent:

‘*2. The Sweet patent is limited in scope to oscillo-

graphic recording.” (A 83)

A. B. Dick chailenged the inclusion of this holding on

scope in the final judgment, asserting that it was in the

nature of an advisory opinion, not based on a case or

controversy, and, consequently, beyond the court’s power

under the Constitution (A 73). That argument was

rejected,

The District Court judgment was appealed by A. B. Dick

to the Court of Appeals for the Sixth Circuit, and that

appeal is still pending.

A. B. Dick-Burroughs Litigation

Following the filing of the Mead opinion, Burroughs

amended its Answer to plead collateral estoppel, and, once

the Mead final judgment was entered, Burroughs moved

for summary judgment on the grounds that:

(1) the scope of the Sweet patent had been deter-

mined in a final judgment in the Mead case,

which is entitled to collateral estoppel effect, and

* The Mead court also held Lewis-Brown patent 3,298,030 to be

invalid, and, as already noted, that patent is not at issue here.

5

(2) the accused Burroughs equipment clearly falls

outside the adjudicated scope.

The District Court granted summary judgment (A 87),

but the Court of Appeals for the Federal Circuit reversed,

holding that:

‘*Except in the context of validity or infringement,

judicial statements regarding the scope of patent

claims are hypothetical insofar as they purport to re-

solve the question of whether prior art or products

not before the court would, respectively, anticipate or

infringe the patent claims... .

‘*In view of the foregoing, we hold that judicial state-

ments regarding the scope of patent claims are en-

titled to collateral estoppel effect in a subsequent in-

fringement suit only to the extent that determination

of scope was essential to a fina! judgment on the

question of validity or infringement; further that such

statements should be narrowly construed.’’ (A 117-18)

Reasons for Granting the Writ

POINT I

The CAFC ruling, in this case, on the basically im-

portant question of the scope of a patent, is directly

contrary to this Court’s collateral estoppel rulings

over the past decade.’

This Court’s Blonder-Tongue ruling in 1971 rejected

the then-maligned doctrine of mutuality of estoppel, which

had protected a patent owner’s right to sue alleged in-

fringers successively, even though the patent were held

* See, e.g., Blonder-Tongue v. University Faundation, 402 U.S.

313 (1971) ; Parklane Hosiery Co. v. Shore, 439 U.S. 322 (1979);

Montana vy. United States, 440 U.S. 147 (1979); Allen v. McCurry,

449 U.S. 90 (1980).

invalid in the first suit. Triplett v. Lowell, 297 U.S. 638

(1936).

Parklane Hosiery thereafter made it clear that while

Blonder-Tongue found needless relitigation particularly

wasteful, and baseless, where a patent has been held to

be invalid, the Court in Blonder-Tongue had actually ad-

dressed the broader question of ‘‘whether it is any longer

tenable to afford a litigant more than one full and fair

opportunity for judicial resolution of the same issue.’’

439 U.S. at 327-8; see, also, Allen v. McCurry, 449 U.S.

at 94-5.

This principle was extended to the offensive use of col-

lateral estoppel in .”arklane, and it has been recognized

as applicable to every sphere of civil litigation. See,

e.g., Montana v. United States, supra; Allen v. McCurry,

supra.

In the present case, the CAFC has completely under-

mined the principle of these cases as it applies to a vital

area of patents, their scope, which has long been a subject

of concern to this Court. See, especially, Blonder-

Tongue, 402 U.S. at 343-4, 349-50; and the cases infra,

on page 13.

Moreover, since the CAFC has nationwide impact in all

cases pertaining to patents, it will be the CAFC ruling,

and not the rulings of this Court, that will compel ad-

herence by the district courts, until this matter has been

rectified. 28 U.S.C. 1292 (¢) and (d), 1295; South Corp.

v. United States, 690 F.2d 1368, 1271 (Fed. Cir. 1982);

Radio Steel € Mfg. Co. v. MTD Products Inc., 566 F.Supp.

609, 613 (N.D. Ohio 1983) ; Union Carbide Corp. v. Ameri-

can Can Co., 558 F.Supp. 1154, 1156 (N.D. Ill. 1983).

Both the District Court and the CAFC recognized that

collateral estoppel can apply only to an issue that has

been actually and necessarily determined in a prior suit,

under circumstances that afforded a full and fair oppor-

tunity to litigate the issue. (A 93, 112); Montana, 440 U.S.

at 153.

7

On the question of a full and fair opportunity to liti-

gate, as the District Court observed, this has not been

raised by A. B. Dick (A 94). Nor can there be any

question that the issue of scope was actually litigated in

the Mead case (Id).

The only question in serious dispute is the essential

nature of the scope holding in Mead. The District Court

found it essential (A 96); the CAFC did not (A 118).

More specifically, the CAFC found that the Mead court’s

determination of scope was not essential to its final judg-

ment on validity or infringement (A 117-18). While the

construction of the Sweet patent was the predicate for

the Mead court’s holding that the Sweet patent is invalid

‘fas so construed” (A 80), the error of the CAFC is more

fundamental.

The CAFC erroneously ruled that a court’s final judg-

ment of the scope of a patent, even in the course of a

protracted multi-million dollar litigation concerning the

patent, can be deemed an essential issue for collateral

estoppel purposes only when it underlies, and only to the

extent that it underlies, the issue of validity or infringe-

ment. It held that a final judgment on scope cannot affect

any product not actually before the court, and, as a con-

sequence, each new product must project a new suit. There

is no rational] basis for such a rule of law.

The facts here are that Mead is in the ink-jet printing

business. It was charged with infringement, and then

sued. It filed a declaratory judgment action in which it

sought to have the scope of the Sweet patent determined,

it projected scope as an issue in the final pretrial order,

litigated this issue, and argued successfully against

A. B. Dick’s assertion that the court did not have the

jurisdiction to determine the issue (A 65).

The result, after a full and fair litigation of the issue,

was a declaration of the patent’s scope in the Mead final

judgment.

Thus, the ruling on scope was not merely a finding in-

cidental to a judgment on another issue, or necessary

merely to clarify language in some of the claims for in-

fringement purposes. It was itself a judgment, as a dec-

laration contained in the final judgment in a declaratory

judgment action, and the findings to the same effect, that

were embodied in the court’s opinion, were necessary to

that judgment.*

This Court has said that ‘‘once an issue is actually and

necessarily determined by a court of competent jurisdic-

tion, that determination is conclusive in subsequent suits

based on a different cause of action involving a party to

the prior litigation. Application of [this] . . . doctrine

is central to the purpose for which civil courts have been

established, the conclusive resolution of disputes within

their jurisdictions.’’ Montana, 440 U.S. at 153.

The ruling of the CAFC in this case has disavowed this

salutary rule insofar as it applies to the scope of a patent.

*In an earlier case, « District Court had ruled that:

“. . , no difference in substance is seen between interpreting

language for purposes of validity and interpreting language

for purposes of determining scope. The rationale of the

Blonder-Tongue decision applies equally to both situations.”

Iron Ore Co. of Canada v. Dow Chemical Co., 177 USPQ 34,

58 (D. Utah 1972), aff'd, 500 F.2d 189 (10th Cir. 1974).

‘See, also, Molinaro vy. Sears, Roebuck & Co., 478 F. Supp.

818 (S.D.N.Y. 1979); Molinaro v. Hart Electronics Corp., 212

USPQ 697 (D. Pa. 1981).

POINT II

There is no unfairness in according collateral

estoppel effect to final determinations of patent scope.

Since the Mead court decided its own jurisdiction, that

issue was also entitled to collateral estoppel effect in

this suit. Underwriters Assur. Co. v. North Carolina Life,

455 U.S. 691, 706 (1982); Stoll v. Gottlieb, 305 U.S. 165

(1938); Restatement Second of Judgments, 1982, $12,

espec. coments ¢. and d.; 18 Wright, Miller & Cooper,

Federal Practice and Procedure, § 4428, pp. 271 et seq.

(1981). The CAFC ruled, however, that regardless of

jurisdiction, it is not without ‘‘diseretion’’ to determine

whether a particular case is appropriate for the application

of collateral estoppel, and it exercised that discretion to

deny collateral estoppel effect to the Mead court’s ruling

on scope. The CAFC relied on this Court’s observations in

Parklane Hosiery that the offensive use of collateral

estoppel may, under some circumstances, be unfair.

There is little unfairness, however, in according finality,

for defensive use purposes, to a judgment that has re-

solved an issue after a full and fair litigation. It is more

unfair, as well as unwise, to deny finality under these cir-

cumstances. Indeed, the dangers in an unfettered dis-

eretionary application of the collateral estoppel rulings of

this Court, when a full and fair opportunity to litigate in

the first suit has not been questioned, are abundant. Cf.

Blumcraft of Pittsburg v. Kawaneer Company, Inc., 482

F. 2d 542, 547 (5th Cir. 1973); Kaiser Industrial Corp. v.

Jones & Laughlin Steel Corp., 515 F. 2d 964, 978-9 (3d Cir.

1975), cert. denied, 423 U.S. 876 (1975).

The CAFC ruling reflects a belief, without analyzing the

close prior art considered by the Mead court, and without

reviewing the Sweet file history before the Patent Office,

10

and the remainder of the extensive record in the Mead

case, that the Mead court should not have made a deter-

minative ruling on scope.

The appellate review of that ruling, however, should be

pursued in the Court of Appeals for the Sixth Cireuit—

where the full record can be considered—if we are to have

an orderly judicial system. From that tribunal, further

appellate review can be sought in this Court, again with

the full record in hand.‘

Any rule which permits another court, without the record

in hand, to deny finality to the first court’s ruling, for de-

fensive use purposes, where the issue has been determined

after a full and fair opportunity to litigate, is both unfair

to those relying on our courts and unworkable.

*A review of the prior art and Patent Office file history by the

District Court in the Mead case led to the following finding and

conclusion of law:

“It is clear that through such characterizations of Magarver

and Blackford and through the amendments to the claims which

Sweet made in response to the rejection of the claims as fully

met by Magarvey and Blackford, Sweet limited his invention

to oscillography in which a picture of the incoming waveform

is reproduced on paper by recording as a function of time the

magnitude of deflection of each droplet in a succession so that

the succession of deflected droplets trace the waveform on

paper. This is the function and operation of an oscillograph.

(Finding 71) (A 33)

“Based on representations made to the Patent Office and

amendments made to the claims in order to obtain the patent,

A. B. Dick is estopped to construe the claims of the Sweet

patent to claim other than an oscillographie recorder.” (Con-

elusion 153) (A 59)

il

POINT Ill

The CAFC ruling raises unacceptable social and

economic consequences.

The social and economic consequences of denying finality

to determinations in patent cases were considered at some

length in this Court’s opinion in Blonder-Tonque. It con-

tinues costly litigation, involves inordinate trial time, taxes

the overburdened federal courts, involves a misallocation

of resources of many kinds, and interferes with predict-

ability and decision-making for both patent owners and

their competitors.

Before this misapplication of the law is permitted to take

effect, it should be corrected. And there is no other forum

for correction.

POINT IV

The CAFC has abrogated the role of the Federal

Courts in determining the basically important question

of the scope of a patent.

The CAFC ruling in this case has serious jurisdictional

implications, inherent in the court’s ruling that:

‘‘Except in the context of validity or infringement,

judicial] statements regarding the scope of patent

claims are hypothetical insofar as they purport to

resolve the question of whether prior art or products

not before the court would, respectively, anticipate

or infringe the patent claims.’’ (A 117)

By characterizing the issue of scope as ‘‘hypothetical’’,

except in the context of validity or infringement, the

court has determined that no federal court jurisdiction

exists as to the issue of scope except in these areas. U.S.

12

Constitution, Art. III, §2, cl. 1; Aetna Life Ins. Co. v.

Haworth, 300 U.S. 227, 239-42 (1937).

It thus precludes a declaratory judgment by one com-

petitor against another, simply to adjudicate the scope

of a patent, even where its scope is in dispute. As such,

it precludes a judicial determination of the extent of a

product line one can pursue, through financial, plant and

personnel investment, without fear of injunction.

It even precludes one who has been sued for in-

fringement from obtaining a construction of the scope of

the patent asserted to be infringed, beyond the issue of

whether the accused product infringes. This will neces-

sitate needless litigation for each new product, as well as

creating needless uncertainty.

Thus, while declaratory judgment relief remains avail-

able to determine the scope of a statute or contract, or

the metes and bounds of real property, where those issues

are in dispute, the decision in this case renders such relief

unavailable to determine the scope of a patent, except in

the resolution of validity or infringement.’

* See, e.g., Bowsher v. Merck & Co., 103 S. Ct. 1587 (1983)

(“we must analyze the policies underlying the statutory provision

to determine its proper scope’); North Dakota v. United States,

103 S. Ct. 1095 (1983) (“we stace once again the obvious when

we note that, in determining the scope of a statute, one is to

look first at its language”); North Haven Board of Education v.

Bell, 456 US. 512 (1982) (“Our starting point in determining

the scope of Title IX is, of course, the statutory language.’’) ;

Montana vy. United States, 450 U.S. 544 (1981) (“This case con-

cerns the sources and scope of the power of an Indian tribe to

regulate hunting and fishing by non-Indians on lands within its

reservation owned in fee simple by non-Indians.”) ; Abbott Labora-

tories v. Gardner, 337 U.S. 136 (1967) (“These regulations pur-

port to give an authoritative interpretation of a statutory pro-

vision . . .; its promulgation puts petitioners in a dilemma that

it was the very purpose of the Declaratory Judgment Act to

(footnote continued on following page)

13

The importance of a patent’s scope, both as a grant and

a limitation, has been discussed in many decisions of this

Court. White v. Dunbar, 119 U.S. 47 (1886); Motion

Picture Co. vy. Universal Film Co., 243 U.S. 502, 510 (1917);

Carbice Corp. v. American Patents Corp., 283 U.S. 27,

31 (1931); Leitch Mfg. Co. v. Barber Co., 302 U.S. 458

(1938); Ethyl Gasoline Corp. v. United States, 309 U.S.

436, 456 (1940); Morton Salt Co. v. Suppiger Co., 314 US.

488, 492 (1942); Mercoid Corp. v. Mid-Continent Co., 320

U.S. 661, 666 (1944); Precision Co. v. Automotive Co., 324

U.S. 806, 816 (1945); Zenith Corp. v. Hazeltine, 395 U.S.

100, 136 (1969) ; Blonder-Tongue vy. University Foundation,

402 U.S. at 343-4, 349-50; Dawson Chemical Co. v. Rohm &

Haas Co., 448 U.S. 176, 221 (1980).

To determine whether one is tying or otherwise con-

trolling products that are outside the scope of a patent

monopoly, or predicating royalty payments on such

products, the scope must be determined—whether or not it

is coupled with the issue of validity or infringement. The

same is true as to the extent of an assignor’s estoppel to

challenge validity, Westinghouse Co. v. Formica Co., 266

U.S. at 350, to the extent that this estoppel survives this

Court’s ruling in Lear, Inc. v. Adkins, 395 U.S. 653 (1969)

(which terminated the doctrine of licensee estoppel).

(footnote continued from preceding page)

ameliorate.”’) ; Skelly Oil Co. v. Phillips Co., 339 U.S. 667 y met

(“this language in the contract may have a scope . han

land Casualty Co. v. Pacific Co., 312 U.S. 270 (1941); c United

States v. California, 332 US. 19 (1947) (“We may assume that

location of the exact coastal line will involve many complexities

and difficulties. But that does not make this any the less a

justiciable controversy.”); and cf. Westinghouse Co. v. Formica

Co., 266 U.S. 342 (1924) (“The grantor purports to convey the

right to exclude others in the one instance from a defined tract

of land, and in the other, from a described and limited field of

the useful arts. The difference between the two cases is only the

practical one of fixing exactly what is the subject matter conveyed.

A tract of land is easily determined by a survey. Not so the

scope of a patent right for an invention.”).

14

There is no basis for treating patent scope differently

from any other issue. Where a real and immediate con

troversy exists as to the scope of a patent, that issue

should be deemed justiciable, and subject to declaratory

judgment relief—whether or not it is coupled with an issue

of validity or infringement. Cf. Aetna, 300 U.S. at 293-42;

Maryland Casualty, 312 U.S. at 272-4.

It is alien to fundamental concepts of jurisprudence to

hold that our federal courts have jurisdiction to determine

the validity of a patent, but not its metes and bounds, un-

less the latter determination is tied to validity or infringe-

ment. And it consequently cannot be the law of the land

that federal courts are without jurisdiction to determine

the issue of patent scope, since it is ‘‘hypothetical” to the

extent that it deals with prior art or products not before

the court.

CONCLUSION

For the reasons stated, a writ of certiorari should

issue to review the judgment entered in this case by

the Court of Appeals for the Federal Circuit.

Date:

Respectfully submitted,

Craries W. Brapiry

Attorney for Petitioner

Burroughs Corporation

Of Counsel:

Sreven D. Grazer

Davis Hoxre Farrurutit & Hapcoop