# Appendix — In re Wilco Marsh Buggies & Draglines, Inc. > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385011_0916%3A2 ## Record - **Collection:** Supreme Court brief - **Document type:** Appendix - **Published:** January 1, 1984 - **Citation:** 465 U.S. 1021 ## Text In re Wilco Marsh Buggies & Draglines, Inc., John M. Wilson, Sr., Dean R. Wilson, and Robert Je Wilson, Jr.,, Petitioners. ON PETITION FOR ISSUANCE OF WRIT OF APPENDIX. ON BEHALF OF ete ates CASE NO. SUPREME COURT OF THE UNITED STATES OCTOBER TERM 1983 In re Wilco Marsh Buggies & Draglines, Inc., John M. Wilson, Sr., Dean R. Wilson, and Robert J. Wilson, Jr., Petitioners. ON PETITION FOR ISSUANCE OF WRIT OF MANDAMUS AND PRO- HIBITION TO REQUIRE THE JUDGES OF THE COURT OF APPEALS FOR THE FIFTH CIRCUIT TO STAY WITHIN THE CONFINES OF THEIR APPELLATE JURISDICTION AND TRANSFER APPEAL NO. 82-3619 TO THE COURT OF APPEALS FOR THE FEDERAL CIRCUIT APPENDIX ON BEHALF OF PETITIONERS Ned L. Conley Jeffrey W. Tayon Allied Bank Plaza Houston, Texas 77002 (713) 237-3195 Counsel for Petitioners OF COUNSEL: Butler & Binion Allied Bank Plaza Houston, Texas 77002 (713) 237-3111 TABLE OF CONTENTS Unpublished opinion of the United States Court of Appeals for the Fifth Circuit dated September 2, 1983 denying Petitioner's Motion To Transfer Appeal No. 82-3619 To The United States Court of Appeals for the Federal Circuit eeeseoeeeeeeeeeeeeeeeneeeenene Petitioner's Motion to Transfer and Stay Pending Transfer to the United States Court of Appeals for the Federal Circuit ..ccccccccccccccccccccccccccecs Kori et al‘s Memorandum in Opposition to Motion to Transfer and Stay Pending Transfer to United States Court of Appeals for the Federal Circuit ..ceseseeeeesesees Petitioner's Reply to Appellees’ Opposition to Appellants’ Motion to Transfer to United States Court of Appeals for the Federal Circuit ....+eses-seeee Kori Corp. v. Wilco Marsh Buggies & Draglines, Inc., 561 F. Supp. cae a. 1961) eeeeeeeeeeeeneeeneaeeeeeeneeneeeeeeeneneeee Kori Corp. v. Wilco Marsh Buggies & Draglines Inc., 708 F.2d Tet (5th Cir. 1983) oe Reply Brief for Defendants/Appellants in Appeal No. 82-3619 Before the United States Court of Appeals for the Fifth Circuit e@eeeeoeeeaeeoeaeeoeaeeeeaeeeeeeeeeeeaeeee Senate Report (Judiciary Committee) No. 97-275 to accompany the Federal Courts Improvement Act of 1982, P.L. 97-164 eeeeeceaeoevoeee ee eee eevee eeeeeeeeeeeeeaeeeee 11 27 39 62 68 97 10. ll. 12. 13. House of Representatives Report (Judiciary Committee) No. 97-312 to accompany Federal Courts Improve- ment Act of 1982, PP- 1-52 eeeeeeeeeeeeeeeeeeeeees Hearing before the Subcommittee on Courts, Civil Liberties, and the Administration of Justice of the Committee on the Judiciary, House of Representatives, May 4, 1978, cover, PP. 372-390 eeeeeeeeeeeeereeeeeeeeeeeeeeeeeeeeeeeee Catanzano v. Hart Electronics sik Appeal No. - , Unp shed Slip Opinion of the United States Court of Appeals for the Federal Circuit ....ceeeececees Letters Patent 3,842,785 eeeeoeeoeeeeeeeeeeeeneeeeeenee Statutes and Rules in ISSUC ..cccceseessecessseses 137 189 209 216 223 gas DO NOT PUBLISH IN THE UNITED STATES COURT OF APPEALSU.S. COURT OF APPEALS ‘ _ FOR THE PIPTH CIRCUIT FILED - SEP - 2 1983 sai baitinaianed GILBERT E GANUCHEAU ee CLERK KORI CORPORATION, ET AL., Plaintiffs-Appellees, versus WILCO MARSH BUGGIES AND DRAGLINES, INC., ET AL., Defendants-Appellants. Appeal from the United States District Court for the Eastern District of Louisiana Before RUBIN, GARWOOD, and JOLLY, Circuit Judges. BY THE COURT: IT IS ORDERED that appellants' motion to transfer and stay pending transfer to the United States Court of Appeals for the Federal Circuit and transmit the record back to the United States District Court for the Eastern District of Louisiana is DENIED. The present appeal, in this patent infringement litigation, is from the August 30, 1982 judgment of the district court awarding damages and attorneys' fees in the accounting phase of the action, trial on the accounting and amount of attorneys’ fees issues having taken place during April 1982. Defendants~- appellants' timely motion for new trial having been overruled on sr» | a i aa. Pe October 12, 1982, those parties filed their notice of appeal on October 13, 1982, and subsequently filed the record, and on March 15, 1983, their appellants’ brief, in this Court. On July 28, 1983, after appellees’ brief was filed with this Court, appellants filed their instant motion seeking transfer of this appeal to the United States Court of Appeals for the Federal Circuit. Appellees oppose the motion. The trial in the district court of this case was bifurcated, as it is in many patent cases, with the court first trying the issues of the validity and infringement of the patent, and thereafter the accounting issues. The trial on the validity and infringement issues was held in February 1981, and on December ll, 1981 the court gave judgment for plaintiffs-appellees holding the patent valid and infringed by defendants-appellants, enjpining defendants-appellants from infringing the patent, ordering that plaintiffs-appellees were entitled to an accounting from defendants-appellants for “all damages suffered by them as a result of the infringement by the defendants" and to costs and attorneys’ fees, and providing that "[a] hearing shall be set at a later date to determine the question of damages, costs, and attorneys’ fees." This judgment also dismissed defendants' counterclaim, based on alleged antitrust violations (no trial was held on the counterclaim, as it was apparently conceded to be dependent on defendants' claims that the patent was invalid or not infringed, and the counterclaim had been separated out for trial just us had the accounting issues). On December 24, 1981 . - ate eee. t > defendants-appellants gave timely notice of appeal to this Court from the December 11, 1981 judgment, and, after all parties filed briefs with this Court, the case was orally argued in March 1983 and on June 27, 1983 this Court affirmed the district court's December uu, 1981 judgment. Kori Corporation v. Wilco Marsh Buggies And Draglines, Inc.,708 F.2d 151 (5th Cir. 1983). In August 1983, motion for rehearing in that proceeding was overruled and the mandate issued. Public Law 97-164, 97th Congress, approved by the President April 2, 1982, among other things, created the United States Court of Appeals for the Federal Circuit and provided, by enacting 28 U.S.C. § 1295, that it "shall have exclusive jurisdiction--(1) of an appeal from a final decision of a district court of the United States ... if the jurisdiction of that court was based, in whole or in part, on section 1338 of this title ... ." Section 1338(a) of 28 U.S.C. gives United States district courts original jurisdiction, inter alia, “of any civil action arising under any Act of Congress relating to patents ... ." Prior to Public Law 97-164, 28 U.S.C. § 1292(a) provided for interlocutory appeals to courts of appeals from orders granting or refusing injunctions, appointing receivers, certain orders in admiralty cases, and, by its pragraph (4), from "judgments in civil actions for patent infringement which are final except for accounting.” Pu Law 97-164 repealed paragraph (4) of section 1292(a), and adde@ to section 1292 a new subsection (d) giving the Court of Appeals for the Federal - ed Circuit jurisdiction of appeals from certain interlocutory orders of the Court of International Trade and the United States Claims Court, and a new subsection (c) providing: "(c) The United States Court of Appeals for the Federal Circuit shall have exclusive jurisdiction-- "(1) of an a al from an interlocutory order or decree described in subsection (a) of this section in any case over which the court would have jurisdiction of an appeal under section 1295 of this title; and "(2) of an appeal from a judgment in a civil action for patent infringement which would otherwise be appealable to the United States Court of Appeals for the Federal Circuit and is final except for an accounting." Public Law 97-164 likewise amended 28 U.S.C. § 1291, granting courts of appeals jurisdiction of appeals "from all final decisions of the district courts of the United States,” so as to except the Court of Appeals for the Federal Circuit from this grant of jurisdiction and to provide that such Court's jurisdiction "shall be limited to the jurisdiction described in sections 1292(c) and (d) and 1295 of this title.” Public Law 97-164 also amended 28 U.S.C. § 1294, providing, inter alia, that appeals “from reviewable decisions of" a district court “shall be taken... to the court of appeals for the circuit embracing the district," by adding to section 1294 the language, “Except as provided in sections 1292(c), 1292(d) and 1295 of this title." Section 1631 of 28 U.S.C. was likewise enacted by Public Law 97-164, and provides that under certain circumstances a court in —_ cua which "there is a want of jurisdiction" may transfer the “action or appeal" to any other court in which “he "action or appeal could have been brought at the time it was filed or noticed." Section 402 of Public Law 97-164 states that “[ujnless otherwise specified, the provisions of this Act shall take effect on October 1, 1982." Section 403(e) of the Act provides: *(e) Any case in which a notice of appeal has been filed in a district court of the United States prior to the effective date of this Act shall be decided by the court of appeals to which the appeal was taken." Not surprisingly, we have found no decision or legislative history which is helpful in resolving the problem before us.* Undeniably, a difficult and close question is presented. We conclude that "case" as used in section 403(e) of Public Law 97-164 refers to the case, or judicial unit, pending in the district court, and that in this instance there was but one such case, namely, Civil Action No. 79-3636 in the United States District Court for the Eastern District of Louisiana. Notice of appeal in that case, which brought forward for appellate review the controlling issues of patent validity and infringement by defendants-appellants, was filed in December 1981, well before the effective date of Public Law 97-164, and those issues have *Appellants cite Groves v. General Insurance Corp., 381 F.2d 517 (10th Cir. 1967), anc Prigetee va New York Litt 28. Co., 270 F.2d 198 (6th Cir. 1959), ne : y relevant, each case dealing solely with the caoethen of a notice of appeal, and neither case involving any disputed question concerning which appellate court had jurisdiction or the transfer of an appeal from one appellate court to another. —_ =) been resolved by this Court's prior opinion herein. We observe that in the present appeal appellants’ contentions appear to involve, inter alia, questions of the scope of the infringement as applied to various products, thus potentially implicating the scope of our prior decision herein. Up until this point all parties obviously proceeded on the assumption that this Court had jurisdiction and that the accounting “tail" did not wag the dog. We believe that assumption was correct. Appellants’ motion is DENIED. IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT KORI CORPORATION © AND HUEY J. RIVET VERSUS APPEAL NO. 82-3619 WILCO MARSH BUGGIES AND DRAGLINES, INC., JOHN M. WILSON, SR., DEAN R. WILSON, AND ROBERT J. WILSON, JR. MOTION TO TRANSFER AND STAY PENDING TRANSFER TO UNITED STATES COURT OF APPEALS FOR THE & FEDERAL CIRCUIT AND TRANSMIT RECORD BACK TO THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA NOW COME APPELLANTS and file this Motion to Transfer and Stay Pending Transfer to United States Court of Appeals for the Federal Circuit and Transmit Record Back to the United States District Court for the Eastern District of Louisiana and would show the Court as follows: (1) This Motion pertains to an appeal from the United ca States District Court for the Eastern District of Louisiana that entered judgment in Civil Action No. 79-3636 for damages for patent infringement against Appellants. A notice of appeal was timely filed on October 12, 1982, and this appeal was docketed with the United States Court of Appeals for the Fifth Circuit. (2) In due course, Appellants’ main brief was prepared and filed by Appellants’ former counsel, Nathan Greenberg. Appellants have recently retained new counsel, viz, Ned L. Conley of Butler & Binion, Allied Bank Plaza, Houston, Texas, to represent them in the remainder of this appeal. An appearance of counsel was transmitted to the Court on Friday, July 22, 1983. (3) On october 1, 1982, the effective date of 28 USC §1295, a new federal circuit court of appeals was created called The United States Court of Appeals for the Federal Circuit (hereinafter the "CAFC") and was given "exclusive jurisdiction... of an appeal from a final decision of a district court of the United States... if the jurisdiction of that court was based, in whole or in part, on section 1338 (of Title 28)." See 28 USC §1295. Section 1338 of Title 28 gives original and exclusive jurisdiction of all civil actions arising under any Act of Congress relating to patents to the United States district courts. (4) Contrary to Rule 3(c) of the Federal Rules of Appellate Procedure, Appellants’ Notice of appeal erroneously indicated that appeal was being taken to the United States Court of Appeals for the Fifth Circuit instead of the CAFC. (5) Under 28 USC §1295, as of October 12, 1982, when the notice of appeal was filed, the CAFC had exclusive jurisdiction over this appeal. (6) Because the Fifth Circuit does not have jurisdiction, Appellants respectfully request, pursuant to 28 USC §1631, that this case be transferred to the CAFC. See Graves vs. General Insurance Corp., 381 F.2d 517 (10th Cir. 1967); Trivette v. New York Life Ins. Co., 270 F.2d 198 (6th Cir. 1959). (7) Under Rule ll(a)(4) of the Rules of the CAFC, the record of the district court proceedings is to be retained 8 nie vu 4 ST Doe i ai, » ue : eet ee | a eo oe xs ante he. a. oe an a a ee _- . —_——_ by the district court unless ordered by the CAFC. Further, Rule 12 of the CAFC requires that a separate appendix be prepared for transmission to the CAFC which includes all evidence which the parties wish to draw to the attention of the Court. Accordingly, Appellants request that the record on appeal held by the United States Court of Appeals for the Fifth Circuit be tranferred back to the United States District Court for the Eastern District of Louisiana so that Appellants may comply with the Rules of the CAFC and prepare an appendix for transmittal to the CAFC. (8) Having regard for the requirements imposed and the exicusive jurisdiction held by the CAFC, Appellants respectfully request that all further proceedings involving this appeal be stayed pending transfer to the CAFC. Respectfully submitted, e BUTLER & BINION Ned L. Con Allied Bank Plaza Houston, Texas 77002 (713) 237-3195 CERTIFICATE OF SERVICE This is to certify that a true and correct copy of the foregoing Motion to Transfer and Stay Pending Transfer to United States Court of Appeals for the Federal Circuit and Transmit Record Back to the United States District Court of - €or the Eastern District of Louisiana has been forwarded first class mai}, to all counsel of record, on this the oe day of , 1983. . Oe gate. oe A Rie. 9 5 pecs ; PM ib toe hE in ot ee F eee te oe eee a : : ‘ co eee Saga eo 6s IN THE UNITED STATES COURT OF APPEALS - POR THE FIFTH CIRCUIT KORI CORPORATION . 8 AND HUEY J. RIVET § ) VERSUS § § APPEAL NO. 82-3619 WILCO MARSH BUGGIES AND § DRAGLINES, INC., JOHN M. § WILSON, SR., DEAN R. WILSON, § AND ROBERT J. WILSON, JR. § ORDER Having considered Appellants’ Motion to Transfer and Stay Pending Transfer to United States Court of Appeals for the Federai Circuit and Transmit Record Back to the United States District Court for the Eastern District of Louisiana and all sub- missions of the serthes, IT IS HEREBY ORDERED: (1) that this appeal and all briefs on file be trans- ferred to the United States Court of Appeals for the Federal Circuit; | (2) that the record in this appeal be transmitted back to the United States District Court for the Eastern District of Louisiana; and (3) that all further proceedings in this appeal be stayed pending further action by the United States Court of Appeals for the Federal Circuit. Clerk, United states Court of Appeals for the Fifth Circuit 10 ce _ o a _ “a Ee ee tS ‘we * Se ONT ae SNe ae Ersieter “of appeal No. 82-3619 from the Pifth Circuit Se - med tes the Court: of Appeals for . the Federal Circuit | = (CAPCY's demonstrate eet oe eppeliants! coquase is illogical and , See ad 2 > woe? ‘ - unadvisable. ic ae a . ee ah SE eee “The: ‘Jurisdiction. Statement: on Page VIII of appellees*. @rcies filed on July 22, 1983 adequately addressed the issue raised by appellants in their Motion to Transfer (See Exhibit A ir Ha e- . °*e : MEER oye: er 4 ‘ © ‘ ; “as Aes. m2 : ee a ec : ; : ee attached ens kL, he 3 at NE mes ereta ts “8 et RSF. — = “7g 7A : ; %. ie ee ¥ a Batent Intebiieniiik puke was filed by Kori Corporation - : o tx Fs. , » (Ror iy: and uey: J. Rivet against Wilco Marsh Buggies (Wilco) a : ee - the: individual @efendants in September 1979. The matter came” to. 2 £3 trial ta February | 1981, at which time a week long trial was held on - ¥ = the ices. of the validity and infringement of the Rivet patent before Judge Robert FP. Collins of the Eastern District of Louisiana. The accounting phase of- the Litigation was bifurcated ae “3 Z ncaa u 11 (Sates for trial at a later time. ta 0 beodaber 1981 Judge Collins issued an —— oe the. ares, patent, —— and oe ant Saat. % : z “§ S Deo ‘e briefs, and orak arumeains oa Baar re = 2 e Zz ° ere ag ee ee ee ns neers bn Oe: i * Sane ees and Tutele” ‘on March: 25 “1983. tt yes of: = ‘ 3. ewth -. ee 545 tact Rees es a considered: the voluminoas valiaity: ang: ee - arguments- P of Bo he parties for severmi- a ethe— before res ate rir , cleoe nae opinion on June: 27, 1983 upholding Judge Collins: ‘finding that the: 8 & Rivet patent was walid and infringed by the ‘appellants Wilco, ae ar akon + ae (See Appeal No. 82-3004 Docket Sheet, Exhibit BY” SEES a ra The accounting phase of the litigation was proceeding through the District Court during the time ‘that the validity and infringement decision was being considered by the Pifth Circuit. Wilco had moved Judge Collins in February, 1982 to stay the accounting phase of the litigation pending the outcome of the Pifth Circuit's decision on the validity and infringement issues. Judge e Collins had ordered such a stay if Wilco posted a one million 3 dollar bond to secure the plaintiff's pending the outcome of the Pifth Circuit's decision. Wilco did aot post the one rsillion dollar bond and an accounting trial was éecordingly held in the District Court during the first week of April 1982. Judge Collins again considered the evidence for several months before issuing 2 decision on August 30, 1982 awarding a judgment of over one million '@ollars to Kori as compensation for Wilco's infringement. It is this one million dollar judgment awarded in the accounting case oe Peoudiethetreactd-cnes pee A ee ieclte 1 GS $129 as the vas Fin “r Soe ¥ ae Bee RS zi cng in ‘eentvedietingtion to 28 U.S.C. $1331, ‘cited. ry the “appellants. ‘Seog * was: filed? on March Se: 1983, recited 24 5 Re. ce $1938 a - a oy . ° - = $F: &. ee ‘- : Docket sheet, Exhibit cy. the "appeLiantar ‘pe re ree a ° tent tee: Gis: rere ~% ‘> MS eK . ts: song act (fon, "eho Court s- Juriedictioi: overs thin’ a ; cans F- Be wie ? "1% x€- : 2 ie t Po arabe Mire; Se i, Se ‘ _ The appellees’ statement of jurisdiction: additionally advised: the. Srthed Court that although 28 JU. $.Cc. §1295 states ‘that all patent appeals _ : docketed after October 1, 1982 should be filed in the Court oft: Appeals for the Pederal Circuit, that the Clerk of the CAFC had advised the appellees that an exception exists for accounting trials if an appellate court already has jurisdiction over the - validity and infringement phase of the litigation. Although there. . were no decided cases or statutory support for such a position, the appellees decided not to challenge the appellants’ choice of the i: Pifth Circuit since it seemed a reasonable and logical place. for’: a the case to be heard. The judges of the Pifth Circuit had already” Pg reviewed the voluminous and complex record of this patent case, and’: therefore possessed a superior familiarity with the facts of this case. An understanding and familiarity with the validity and infringement phase of this litigation is essential to a just resolution of the accounting issues on appeal. As can be seen from reviewing the parties’ accounting appeal briefs, the major issues in this case include whether to award the entire market value of the: machines a3 damages; whether profits or royalties are the xy ‘appropriate measure of damages; and whether the deliberate copying Be “s- at. To ee at . aes BY ‘wWilicos of: the. Rivet machine helps. justify the award of double cee) tee | damages; 6 attorneys* fees in this case. A resolution of the an tot. Bice Sucker value issue depends upon the Court finding that the- ot ues toe ~~ patented Rivet structure iapacts the economic value to the . —_—— oo - —_—— ~~ mapaiah we %° pommel BTN : amphibious. craft used by Kori, and an enderetanding of this sesue bd Fy can only. come from an intimate familiarity with the details of. the "machine! S$ construction and operation. Whether to use profits or | cepbbeion as a measure of damages depends in large part on whether non-infringing substitutes are available for the Rivet craft, and such an inquiry intimately involves the details of the prior art patents and machines already considered by this Court in the validity and infringement phase of the litigation. : With regard to the issues of deliberate copying, double ® damages and attorneys fees, it is also necessary for the court to be aware of the details of the prior art. A review of the prior art will reveal that Wilco constructed a machine identical to the Rivet craft, and that there were no others remotely similar. The bad faith of Wilco in litigating the validity and infringement portion of the litigation is also intimately connected with the award of attorneys’ fees in the accounting appeal. For instance, if an appeals court is familiar with the semantic facades erected by the defendants in an attempt to excuse their infringement, the award of attorneys' fees becomes not only reasonable but 14 tnevtealae, * "(wee exanple, Wilco argued at trial that the interior of their pontoons was ‘Supported with Peat beams and not “I* beams, the difference being that if yoo. turn: an s=heee sideways, it is an -~ SES ttre 3 ¥E ite %: ag Hecke ae Paper on et .+?" woes s other’ account ing appeals s a: eee ree bys after’ = ‘Court’ of Appeals: Pes PO. vn ‘infringement. issues. er tlw 7 . + we - 2 tt. y ‘ case. of. first impression, and the puzzling precedent cited by .the "appellant, [Graves Vv. General Insurance Corp., 381 F.2d 517 (10th Cir. 196795 Trivette v. New York Life Insurance Company, 270 F.2d ‘38 (6th Cir. 1959)] is in no way controlling or apposite to this matter. Both of these cases concerned notices of appeal which had inadvertently named the wrong court in the caption or body of the Notice of Appeal. Since this is a case of first impression, the appellees @ urge this Court to make a decision which is consistent with Judicial economy. A panel of judges of this Court is already quite familiar with the details of this complex case, and would be in a position to deal with the accounting issues such more readily than an uninitiated panel of the CAFC. Purther, 28 U.S.C. 1292 states in part... Interlocutory decisions 15 rt «.) ing cal ( “upon to apparently “Seclas” — ins, 14 . : (a) Except as snide in niidnenss (e) and (4) of this section, the courts of appeals shall have jurisdiction of = fromi. « « es | (c) The United States Court of Appeals for the Federal Circuit shall. Save - exclusive jurisdiction—. - ee o 2st 7 : — “3 SE: i Rs ” i (2) of an appeal. from & : Judgmentéi. ee genie a <>... @iwil action for e@ pateake iotringemene= Fe ee tiat a a. ess “pot . which would otherwise be appealable tothe’ (7° 0:3) 27 ; —:.» United States. Court: of: Appeals. for.: thes = i “aS os Pederal Circuit. noes is final cera for aD he » v2 accounting. . ’ aid rnb ORY = So en we Pe Se oe me ee myer emme ee r ee » oe a ee ~oee Ce Tre - ES TT GT Se ‘ . “ « > ’ . ‘oo e . —- =. on? wwe @ result of a patent iatetusenaat, ‘validity aivlane previously argued before the Fifth Circuit Court of Appeals,. (Judges DOLSEHs | Tuttle. and Garwood), and affirmed. Plaintiffs suggest that the accounting action is not within the jurisdiction of the CAFC given the fact that the CAPC did not hear the patent ietriimensan, | validity appeal. (See Stament of Jurisdiction P. VIII Appellee's Brief Exhibit A). Pinally, Rule 3 of the Pederal Rules of Appellate a Procedure states in part. . . +4 Appeal as of Right--How taken Piling the Notice of Appeal. . . -Pailure Saat a of an appellant to take any step [other than the timely filing of a notice of appeal] does not affect the validity of the appeal, but is ground only for such action as the court of appeals deems appropriate, which may include dismissal of the appeal... 16 Should the Pifth Circuit not have jurisdiction in this case, the appeal is defective for failure to timely file the notice... la oo? of appeal according to Pederal Rules of appellate Procedure Sal, 3% and the appeal should be dismissed subject: te a motion: “shows excusable neglect or good cause. Neither: excusable:“n negli good cause can be shown herein. statement - Exhibit D.) — EP eee AS a purely practical matter, the. late. stage ae , >. aw -RMb& Be oo ee een _ wore PE Tamtonn fob lon, SA oh “this transfer is being urged should be considered... Both: the... = appellees and the appellants have filed extensive briefs with the: °- Pifth Circuit Court of Appeals presenting the pertinent case. law of the Pifth Circuit. If jurisdiction of this case is now given to the CAFC, both parties’ briefs will have to be extensively eodouts thereby burdening the parties and the judicial system. A transfer of this appeal would also further delay a final resolution of this matter which has been pending in the Courts since 1979. This attempt to transfer the appeal at this late stage of the proceedings might be yet another instance of the tactics of delay employed by the defendants that prompted Judge Collins to award double damages and attorneys’ fees in this case. If the appellants wanted this case heard by the CAFC, they should have filed there to begin with instead of forcing the appellees to file briefs with the Pifth Circuit before being ambushed with this last second tactic to further delay a final resolution of these issues. 17 The Fifth Circuit Court of Appeals should recognize an exception to 28 U.S.C. $1295 for patent appeals filed after October 1, 1982 which concern the accounting phase of extensive patent a : litigation which has already been before the Fifth Circuit and for = which briefs are now filed. This exception should be recognized for purposes of judicial economy, sound public policy, and a prompt ere _s resolution oe the complex matters which have already been prolonged =. for. too. many. years. in the. federal. courts. @ Respectfully submitted, KEATY & KEATY Es Thomas Ss. str : 1818 ITM Building No. 2 Canal Street New Orleans, Louisiana 70130 Telephone (504) 581-1706 18 STATEMENT OF JURISDICTION This Court has juriediction of appeals from all final deci- sions of the District Courts of the United States under 28 U.S.C. $1291. It should be noted that this differs from the statement of jurisdiction cited by the defendants, who rely on 28 U.S.C. §1331. The statute cited hy the defendants grants jurisdiction to United States District Courts over actione arising under the Constitution, laws or treaties of the United States. Since 28 U.S.C. §1331 grants jurisdiction to District Courts, it is not understood why the defen- dants now cite it to support the Appellate Court's jurisdiction. _ This appeal was docketed on October 18, 1982. 28 U.S.C. $1295 states that all patent appeals docketed after October |, 1982 should be filed in the Court of Appeals for the Federal Circuit (C.A.F.C.). However, the C.A.F.C. has advised the appelices that an exception exists for accounting trials if an Appellate Court already has jurisdiction over the validity and infringement phase of the litigation. For that reason, the Court of Appeals for the Federal Circuit has advised the appellees that the Fifth Circuit Court of Appeals has jurisdiction over this accounting appeai. This exception would make sense since the matter has been derid- ed using Fifth Circuit law, and because the judges of the Fifth Cir- cuit are intimately familiar with the case after having rendered the related validity and infringement decision hetween the sume par- ties in Kori v. Wilco Marsh Buggies & Draglines, et al, Appeal No. 82-3004, decision published June 27. 1983 affirming the validity and infringement of the Rivet patent. UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT NO. 82-4619 i KOR! CORPORATION, HUFY J. RIVET AND LOUIS WOODSON Plaintiffs- \ppellers, versus WILCO MARSIT BUGGIES AND DRAGLINES. INC = JOHN M. WILSON, SR.. DEAN R. WILSON, AND ROBERT J. WILSON, JR. Defendants: Appellants Appeal from the United States District Court for the Eastern District of Louisiana EXHIBIT A RRIEF FOR APPELLEES ;, ety CunP., ET AL., -vs- a Inc., ET AL.» FCOMD, EXHIBITS AND BRIEF INFORMATION | Fiing 4. EXTENSION Fig. Motion for: tm Puta Record or Cort. 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Time to File Record *° ° ——_ ae" of OC Granting Appest i FP —_ Atiedawt of Financial Stetus CJA 20 Ind / Voucher Recd. ——— orce of Etection Rule ic) ———— Sebel tent: Om -enenian ——_ Ahitler ) Oe gnetion er ao ae, in oO oe Case Sub. wie Arg. C) ty Appetient C] by Appts ‘| € OPINION INFORMATION . b: . . Ovrreon Rendered : ¢ °, Lie \attwnes = ( | i Reversed | Aft, in Pe, ———— Loan! Hule 91d} Dwmasal Order —~.. CJA 21 for Transenge 7. REHEARING INFORMATION Mos. for Ext. ~ Ext. te: Mot. for Ext. — Ext, pon for Rehearing ) L ; AppetiantS OC pcpince 1 reg, 0 en Gane = Petitvon for Rehearwg Y REVIEW CASES | Fiting: OC) Aspetien C) Acpetice Ces. En Sere ———— Penton for Rewew of Order { } of Respore of Ci aime O rec oO Order Oenying Rehearing ——— _ 498 Kanon for Enforcement — NLRB L_ | Oimanting —— Arner 10 Apghcanen ter Enforcement OC Osinien 39 —— Crow Avpbesnon tor Entorcerent 0 Order on Pevivien tor Reresring ss Court of Acpests, Fittm Creut - Docket, Form 14 (Rev, 4/74) Page J of 4 cogen Sia al diel AD — tions’: ~ = Sp - won te ortor: — Pesporee Filed By Outre Grented | Cented Ow * _ Merdernnus o Cocker Apces! Out of Time Reinstate Appes! ____> Hearing an Origine! Record ———eee Meering on Orig. Rec. & Typed Grief ee Leave to PitG Typed Brief — Leva to Fite Bria im Excam Pp fs ern oe Oremins by Appstinnt Onis by Apo tee Stay of Mandere = BA Ligh, il aa Lhn af - beer 5 BOD ; 10 ER DOCKET ENTRIES CODE TO ENTRIES 82 | Plg. appellees’ letter dtd. 2722782 attaching] AAG - Armes _.. _| copy of Judge Collins’ order oe AYIA aeeios CE = Clerk's Endorsement _. —_| that it be made a ° ° sition & Ean Cortroom aga - " SS -77 _ M == Mineo or Offast 22. {ric. appellants’ supplemental motion to advanch ° rar . ear ng. . por os PT — Preiminary Type » 2 ' s — Sere , | } SS 9 Sen Section B - , 82. i jonny | 8 — Sterne oy GRANTED GFC ‘2 } T +«+%.\.Tyeed ; , tet ' WwW, —Wen Cowveem : ae w 3 11. SUPREME FORMATION Ne. Prepering Procesdings on Cartiorart Preparing Supp. Procesdings on Cart. Travers tring Orig. Extibie te $.C. Order of $.C. ~ Ext. te Notice of Fig. of Cort. Pet. on Order ot $.c. CF) denies O Granta PE Notice of Derwel of Pet. tor Rehearing. = POET REE RT IE LO ES EP FE ONES I Ie NE a” a aaMmniinattetg * Dete Filis.: Proceedings 3/83 |Flg. appellant's letter dtd. 3/3/83 in response to questions asked og _by the court during oral argument. (CE) e : a 2/83 in response to questiqns asked by _, the court during oral argument. (CE) aa 3/3/83. (3) o* '27/83__|Plg. order DENYING appellees’ motion for reconsideration of appellees’ motion for leave to file reply brief (HAP). hid 14/83. - Pil ltr. d . 7 . — S ke x-8. oS * me . 82 - KORI CORP. ."vs- WILCO MARSH BUGGYS AND DRAGLINES t recono,evers ao omer nronaa on] Fg % 4 EXTENSION Fig. Motion for: | PatidtedteCe ia : | DLZZE7EF mecorten Appest RE LA LS. rereoe. Supe ABecord , No of Vou Transcript Second Susp. Record Me. of Ve. Trerecrpt. Third Supp. Me. of Vole... Aopekant s Bnet : meen tf O8 OM on Aooetants Bret : tree Of O8 OM One j joe: Of £4098 = Record Excerpts-r- sn" Fon 1/4/83 To anne Seon Cortied Last Lt£4f Acoetee 5 Breet __. Briefing Notice teed. __L« “ —/e Aovelies + Bnet > > Briet tor - S__ Bitet tor Appetiant FARES new ~ ee Oriel for Appellant Brief for Cr. Appetiert ‘ Bnet for Appesee ' } . Briet tor Appetice ~ |S. CALENDAR INFORMATION Bret tor Appe ties Sonstes . Brief lor Cr. Appellee Sree ead Reply Brel tor Appetiant PSP EA TIE se Rerpenrersentes O8 OW DFO Supp. tar Agpetant Case Cont'd tor Reassiggwnert 4 Supp. Grief for Appetes Case Reassigned for lft ps hela | oe owoed intervenor. Hearing Panet: Rute 28()) etter—4ppefant Case Argued [() by Appetart () by Appetiee —__ ee ee Case Sub. wioArg C)byAppetant (by Appetes| 6 OPINION INFORMATION ___. Opinion Rendered a Reversed *; Aftd. in Pt PC. Cone. Spec. Vacated Segnes On. | Dierissed [| Fuse Oe. in MISCELLANEOUS BIUNGS Fitirng: -- Openion Withdrawn pointy | I07T8782 Dup. Nonce of Appeal and Clerk's " Staternent of Docket Entres z Papers Trans. from Misc. No. 7. REHEARING INFORMATION Order of OC Granting Appeal IFP Affiaava of Financial Status Seimanitertineeten 0 senate rea ChAppetant ClAcpeiee OReg. 1) EnBare Petition tor Rehearing v= hte la nen 4 ClAppetant ClAgpetce C)Reg ()EnSene Pettion tor Review of Order( ) of Response of OMS MFERC OCC O Order Denying Reheanng ‘ Acphcaton tor Entorcernem—NLRB { ——wd Dissenting BER? becca: a 8/10/83. Substitution o counsel 9. OTHER DOCKET ENTRIES 7/28/83 10. JUDGMENT OR MANDATE INFORMATION 11. SUPREME COURT INFORMATION a, etapa GENCE Fig. & Entg Judgment issg. Copy of Jdgt. to Bo & Creal. Nonce of Appeal to S.C. Preparing Proceedings on Cernorari Prepanng Supp. Proceedings on Cert. Mandate Stayed to a. ae ee JOG. 85 Met. nad. to Clerk Jegt as Mat Perssd. to Clerk = C'srvssa! issd to Clerk Transruting Ong. Exons to $.C. Order of $.C.—Ext. to Notice of Fig. of Cert. Pet. on Orcerof S.C ()Demed () Gramed ee MOCO OF Appeal Feid to Clerk Exsrt:ts Reta to Clerk ___— Nonce of Demal of Pet. tor Reneanng — Juagment ot S.C. CERTIFICATE OF INTERESTED PERSONS The undersigned counsel of record for appellants, Wilco Marsh Buggies and Draglines, Inc., John M. Wilson, Sr., Dean R. Wilson and Robert J. Wilson, Jr., certifies that the follow- ing listed parties have an interest in the outcome of this case. These representations are made in order that the Judges of this Court may evaluate possible disqualification or recusal pur- suant to Local Rule 13.6.1. (1) Kori Corporation Huey J. Rivet Louis J. Woodson Plaincirfs (2) Wilco Marsh Buggies & Draiglines, Inc. John M. Wilson, Sr. Robert J. Wilson, Jr. Sean R. wilson Sefandancs Se teksts SEsARD Ls ‘JAD ARGessasts ral argumenc is rvaycesced due to the fact thac she issues are of such sisnificance as =o Jeem such necessary. STATEMENT OF JURISDICTION This Honorable Court has iurisdiccion over this appeal pur- - swans to 23 U.S.C.Aas. Bhoee- 25 In the Wnited States Court of Appeals FOR THE FIFTH CIRCUIT ° a. a Anns NO. 823619 KORI CORPORATION AND HUEY J. RIVET versus WILCO MARSH BUGGIES (ND DRACLINES, INC, JOHN M. WILSON, SR. DEAN R WILSON, AND ROBERT J. WILSON, JR. \ppeilants UPEAL FROM (1E USELED sPALes ils TUCT COURT FOR THEE ss TERN GASi ich Ck LOUISIANA LGD N, ffs Mt RT .) Coll rNS. jt DGE ORIGINAL BIER ON PPT ALP OF ‘sl S{LCO MARSH Gf: fES Vf PR ACLINES, INC, do 3 om JOHN M. AILS, SRL. DEAN R FILSON, key ANU ROPERT J. FILSON, JR Na " 4 iy NATHAN GREENBERG “tas Greenberz & Dillan : 4144 Secund Street P. 2). Box 365 Gretna, Luwisiana 70054 346-6491 ATTORNEY FOR APPELLANTS oT + om" 8, 26 ote "3 @& @ IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT KORI CORPORATION § and HUEY J. RIVET s § Vv. § APPEAL NO. 82-3619 § WILCO MARSH BUGGIES AND § DRAGLINES, INC., JOHN M. § WILSON, SR., DEAN R. WILSON, 4 and ROBERT J. WILSON, JR. § REPLY TO APPELLEES' OPPOSITION TO APPELLANTS ' MOTION TO TRANSFER AND STAY PENDING TRANSFER Mi TO UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT AND TRANSMIT RECORD BACK TO THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF LOUISIANA TO THE SAID HONORABLE COURT: Now come Appellants and file this Reply to Appellees’ Opposition to Appellants’ Motion to Transfer and Stay Pending Transfer to United States Court of Appeals for the Federal Circuit and would show the Court as follows: Appellees have made three ; statements in their opposition which require a reply by Appellants. First, Appellees suggest that 28 U.S.C. §1292(c) (2) deprives the United States Court of Appeals for the Federal Circuit (hereinafter the "CAFC") of jurisdiction over accounting or damages proceedings. Second Appellees argue that Appellants have failed to timely file their notice of appeal under Rule 3 of the Federal Rules of Appellate 27 Procedure (hereinafter "PRAP"). Finally, Appellees, apparently aware of the weakness in the latter two arguments, ask this Court to judicially engraft "an exception to 28 U.S.C. §1295 for patent appeals filed after October 1, 1982 which concern the accounting phase of extensive patent litigation..." As indicated below, | each of Appellees’ statements is without merit, and, as requested by Appellants, this appeal must be transferred to the CAFC. I. THE CAFC HAS EXCLUSIVE JURISDICTION OVER APPEALS FROM JUDGMENTS ENTERED BY DISTRICT COURTS IN PATENT ACCOUNTING PROCEEDINGS. Contrary to statements made by Appellees, 28 U.S.C. §1292(c) (2) does not deprive the CAFC of its exclusive jurisdiction over judgments entered by district courts in patent infringement accounting proceedings. Prior to enactment of the Federal Courts Improvement Act of 1982 (hereinafter the "1982 Act"), 28 U.S.C. §1292 provided for an interlocutory appeal from a district court's judgment on the issues of patent validity and infringement. The latter statute permitted an appeal to the respective regional circuit court of appeals even though a final judgment on all issues such as damages had not been entered. This is the typical bifurcated patent proceeding: one interlocutory decision is rendered on validity and infringement, ee and one final decision is rendered on damages. Both decisions are appealable. Under the former law, the first was appealable under 28 U.S.C. §1292 and the second under 28 U.S.C. §1291 to the respective regional circuit court of appeals. After October 1, 1982, the effective date of the 1982 Act, the first is appealable under 28 U.S.C. §1292(c)(2) and the second is appealable under 28 U.S.C. §1295 to the CAFC. As such, 28 U.S.C. §1292(c)(2) was not intended to eliminate jurisdiction of the CAFC over a4 final decision awarding damages, but was intended to retain the bifurcated procedure then in existence, and limit appeal over interlocutory decisions to the CAFC. The legislative history accompanying passage of the 1982 Act, in pertinent part, ‘provides: Section 125 - Section 1292 of title 28, United States Code, currently gives regional courts of appeals jurisdiction of interlocutory orders of the district courts concerning injunctions and of judgments in civil actions for patent infringement which are final except for an accounting. Section 125 of the Bill amends this section to give the Court of Appeals of the Federal Circuit jurisdiction of interlocutory appeals in cases that will otherwise come to it on appeal. Senate Report No. 97-275, 1982 U.S. Code Cong. & Ad. News 11, 28. Accordingly, contrary to Appellees’ statements, the only change effected by the 1982 Act in 28 U.S.C. §1292 was to insure, rather than eliminate, exclusive jurisdiction in the CAFC 7 over all aspects of patent district court decisions. II. APPELLANTS' NOTICE OF APPEAL WAS TIMELY FILED. Appellees argue that if this Court is without jurisdiction, then this appeal must be dismissed (subject to «a motion showing excusable neglect or good cause) for failure to file a timely notice of appeal with the CAFC. Appellants disagree. FRAP Rule 3(a) provides, in pertinent part, that: An appeal permitted by law as of right from a district court to a court of appeals shall be taken by filing a notice of appeal with the clerk of the district court within the time allowed by Rule 4. There is no question that this requirement was met by Appellants. However, Appellants erroneously indicated, contrary to FRAP Rule 3(c), that this appeal was to be taken to the Court of Appeals for the Fifth Circuit, instead of the CAFC. Case law, prior to enactment of the 1982 Act, provides that the failure to indicate the proper court to which an appeal is to be taken is not the type of defect that should result in dismissal of an appeal. Instead, the appeal should be considered to have been timely filed and then transferred to the correct court. In Graves v. General Insurance Corp., 381 F.2d 517 (10th Cir. 1967), the court determined that appellant's notice of appeal was adequate although it specified that appeal was being taken to the Supreme Court of New Mexico instead of the Tenth Circuit. : Appellant's notice of appeal in Trivette v. New York Life ins. Co., 270 F.2d 198 (6th Cir. 1959) which specified that appeal was being taken to the “Federal District Court of Appeals for the Sixth Circuit" instead of correctly indicating that appeal was being taken to the United States Court of Appeals for the Sixth Circuit, did not affect the Sixth Circuit's jurisdiction. Appellants submit that all jurisdictional requisites were satisfied by timely filing the notice of appeal with the clerk of the proper district court. The failure to indicate the correct court of appeals should not be considered a jurisdictional defect. This position is supported by Rule 1(b) of the FRAP, which provides that the FRAP rules are not be construed to limit the jurisdiction of the courts of appeals and Rule 2, which provides that a court of appeals may suspend the requirements of any rule, such as Rule 3({c), on application of any party or on its own motion. Further support for Appellants’ position is found in the 1982 Act. On October 1, 1982, Section 301 of the 1982 Act provided for enactment of a new statute, 28 U.S.C. §1631, which provides: Transfer to cure want of jurisdiction Whenever a civil action is filed in a court as defined in section 610 of this title or an appeal, including a petition for review of 31 administrative action, is noticed for or filed with such a court and that court finds that there is a want of jurisdiction, the court shall, if it is in the interest of justice, transfer such action or appeal to any other such court in which the action or appeal could have been brought at the time it was filed or noticed, and the action or appeal shall proceed as if it had been filed in or noticed for the court to which it is transferred on the date upon which it was actually filed in or noticed for the court from which it is transferred. Congress foresaw that problems might arise from the creation of specialized federal courts such as the CAFC and provided a vehicle for resolving these problems in the form of the latter statute. This statute employed broad language to accomodate any such problem. The Senate Committee Report explains: TITLE III - JURISDICTION AND PROCEDURE Transfer of Cases In recent years much confusion has been engendered by provisions of existing law that leave unclear which of two or more federal courts including courts at both the trial and appellate level - have subject matter jurisdiction over certain categories of civil actions. The problem has been particularly acute in the area of admini- strative law where misfilings and dual filings have become common place. The un- certainty in some statutes regarding which court has review authority creates an un- necessary risk that a litigant may find himself without a remedy because of a lawyer's error or a technicality of procedure. Senate Report No. 97-275, 1982 U.S. Code Cong. & Ad. News ll, 21. Id. at 30. At present, the litigant's main rotective device, absent an adequate transfer statute, is the wasteful and costly one of filing in two or more courts at the same time. This puts increased burdens on the courts as well as on the parties. Although most problems in this regard relate to controversies involving the district courts and the court of appeals, there also have been cases involving the Court of International Trade, and the Temporary Emergency Court of Appeals. Therefore, the language of Part A of Title IIz= is broadly drafted to permit transfer between any two federal courts. Further, the jurisdictional section of the CAFC should be read with section 301 of the proposed legislation. This latter section allows any Federal court which lacks juris- diction over a matter to transfer the complaint or appeal to a proper court, in the same manner as if the complaint or appeal had been filed in that court in the first instance. This provision, therefore, will allow the CAFC to transfer cases to the proper circuit court, or vice versa. Section 301. - Because of the complexity of the Federal court system and of special jurisdictional provisions, a civil case may on occasion be mistakenly filed in a court - either trial or appellate - that does not have jurisdiction. By the time the error is discovered, the statute of limitations or a filing period may have ex- pired. Moreover, additional expense is occasioned by having to file the case anew in the proper court. Section 301 adds a new chapter to title 28 that would authorize the court in which a case is improperly filed to transfer it to a court where subject matter jurisdiction is proper. The case would be treated by the transferee court as though it had been initially filed there on the date on which it was filed in the transferor court. ~ The plaintiff will not have to pay any additional filing fees. This provision is broadly drafted to allow transfer between any two Federal courts. Although most problems of misfiling have occurred in the district and circuit courts, others have occurred in the Court of International Trade and the Temporary Emergency Court of Appeals. Some others may occur in the Court of Appeals for the Federal Circuit. The broadly drafted provisions of section 301 will help avoid all of these situations. Id. at 40. This is not a frivolous appeal. The trial court made serious errors of law, as well as fact, which require reversal in this case. Appellants' original counsel, Nathan Greenberg, was not a patent attorney and apparently was not aware of the 1982 Act. Appellants’ present counsel is a patent attorney and has closely reviewed the record and the trial court's opinion. Serious errors of law abound. Appellants' rights should not be affected by errors of previous counsel. The CAFC has exclusive jurisdiction, and this appeal should be transferred - not dismissed. rit. THE CAFC HAS EXCLUSIVE JURISDICTION UNDER 28 U.S.C. §1295; THIS COURT SHOULD NOT RETAIN BY JUDICIAL FIAT JURISDICTION THAT CONGRESS HAS VESTED WITH THE CAFC. Appellees, recognizing the weakness inherent in their earlier arguments, request that this Court extend its jurisdiction beyond that allocated by Congress and judicially create an exception to 28 U.S.C. §1295. However, Congress has spoken and specifically directed that the CAFC take exclusive jurisdiction of this appeal. Further, the legislative history accompanying the creation of the CAFC cautions the Federal courts against expanding their jurisdiction by judicial fiat and, in pertinent part, provides: Before discussing the court's jurisdiction, it needs repetition here that the Federal courts are courts of limited jurisdiction. There is no presumption in favor of jurisdiction, and the basis for jurisdiction always must be affirmatively shown. It is not sufficient that jurisdiction merely be inferred argu- mentatively. See, e.g., Hanford v. Davies 163 U.S. 273 (1656). Thomas v. Board of Trustees of Ohio State Univ., 195 U.5. 207 T1904). 28-29. The Committee is concerned that the exclusive jurisdiction over patent claims of the new Federal Circuit not be manipulated. This \“ measure is intended to aileviate the serious problems of forum shopping among the regional courts of appeals on patent claims by investing exclusive jurisdiction in one court of appeals. It is not intended to create forum shopping opportunities between the’Federal Circuit and the regional courts of appeals on other claims. ; Id. at 29-30. The Committee intends for the jurisdictional language to be construed in accordance with the objectives of the Act and these concerns. Id. at 30. Accordingly, this Court should strictly construe its jurisdiction and transfer this appeal to the CAFC. CONCLUSION Congress has established a new court, the CAFC, and granted that court exclusive jurisdiction over all patent appeals. The CAFC was created to eliminate forum shopping and bring about uniformity of decision in patent cases. Continued decisions by regional circuit courts of appeals will defeat Congress' purpose. The triggering event for the CAFC's jurisdiction is the filing of a notice of appeal in a patent case after October 1, 1982. Congress envisioned the possibility that with specialized Federal courts, an appeal might be filed with —~, the wrong court and imate U.S.C. §1631 to resolve any such problems. Pursuant to 28 U.S.C. §1631, this Court should transfer this appeal to the CAFC. WHEREFORE, PREMISES CONSIDERED, Appellants pray that this Court grant Appellants’ Motion to Transfer and Stay Pending Transfer to United States Court of Appeals for the Federal Circuit and Transmit Record Back to the United States District Court for the Eastern District of Louisiana. e Respectfully submitted, ae f vo. 3 3 % oa Tt xy * ts * hae oe invention by incorporating its imnovative machines sold by defendants for use outside eS | concept and, albeit with some modification of the United States, measured by defend- ae and change, performs substantially the ants’ profits on sale of the infringing units, ee <> way to achieve substantially the same re- which defendants rented for a profit. 35 $$. sult; “doctrine of equivalent” shields inven- USCA. § 271 Ed. tor from such abuse. 35 USCA. § 271 15 facorest om39(2) ag & %. Patents = 226.5 In patent infringement action, plain- Se a Minor modification does not avoid in- tiffs were not entitled to prejudgment in- “3 fringement. 85 U.S.CA. § 271. terest in addition to lost profits damages in ree 10. Patents ¢=325.11(3) view of uncertainty as to the date when EF Reasonable attorney's fees are awarded interest should begin to run. i= in patent infringement actions only in ex- 85 USCA. § 271 rs 4 4 : oe table , tiff’s patent. 85 U.S.CA. § 285. tiffs were entitled to attorney fees IL. Patents ¢=317, 325.11(3) costs in the amount of $28,948. 356 U.S.CA. Patent No, 3,842,785, entitled “amphib- § 271. ious marsh craft,” was willfully infringed 17. Patents ¢=319(3) by defendants where they copied essential In patent infringement action, plain- a. fs Pp oa Ne SAL NOIsnoi: CO0L{ MEET: Peer we. - or egtee & tw epee “om : « & wweteye i cea te te lint ia le POA kh A LEED LEN EAR CLOTS, bb PEEL AI ES FFE Te a Re eed - . . - eo” 514 561 FEDERAL SUPPLEMENT consisting of doubling pecuniary damages awarded for lost profits on sales and rentals Thomas S. Keaty, New Orleans, La, for plaintiff. Nathan Greenberg, Gretna, La, for de- fendants. OPINION ROBERT F. COLLINS, District Judge. wholesale, retail, and use of the “Amphibi- ous Marsh Craft” patented by Rivet U.S. Letters Patent 3,342,785 (hereinafter et "785 patent). 2 The complaint asks judgment of Seven Million and no/100 Dollars ($7,000,000.00), trebie damages and interest, attorneys’ Defendants answer, inter alia that: (a) the patent in suit is invalid because it was issued in violation of the requirements of 35 U.S.C. §§ 101, 102s) and 102(b); (b) defendants do not infringe the patent in suit; and (c) defendants did not obtain by unfair (a) the patent in suit was fraudulently procured in violation of 15 U.S.C. 1 et seq.; (b) by attempting to assert rights under an illegal patent, plaintiffs have violated the anti-trust laws; (c) the illegal actions of the plaintiffs have damaged defendants in the amount of $1,500,000.00, which defendants ask to be trebled pursuant to the anti-trust laws; and (d) the allegations of obtaining trade se- crets by unfair business practices have li- beled defendants and entitled them to dam- ages in accordance with law. 5. Trial by jury has been waived by plain- tiffs and defendants. Est Ege rR wv? ‘ oh ad ‘yy Ase . - - * * > s : ~ . > x : te ove : Nhe . ~ Soe Hts Se eeee A nts Mids a hlta aed ee oe «Tah agp om > 4) peat ne id 4 any tant Anahe aed be + bee 3s. Lt ak. tet. ch] ¢ ¥ —" dowel - sy 7 ae . bok ig ‘ v4 ard hy he "SEAN se Aly _— hp teabe 0 daw baprar) &-4a abe opm > & “ea eter = ar Ogee > be 00 * sted $e whew ee + (sy ts rhs be MPs pa 4 ~4u Bl quettngeeeumgnretthaghenth pane mee relete —~ ney a. aoa ~ Se nach teat at & ty 9 &: 7? 2 we « . tail Py Pe —— oo 96 Oe wees one--+-pb- apie Doapietion ~ ts . -- a” “> . es SAG Gia -- o—_s ee - o- —_ co — ——— © : J ist aii nll; oe bqsege He as it ith ih if jad Hl tid Hilt Na bit ial ae Hea vat“ “Tn i ils da é Hi ii Hy He Lan i CMe Le ny mete Ina ail { alt ily Hi ill : eT it ih ial Veni, iH a a at ile ning i ina qiies etlne bay ah nH EB ; v« ‘ CN pe het Feet nef ape et ey + Op~ sadenggptincn bs : scses Ne A-—e 7 8 ‘n+ ~~ i fi! 518 561 FEDERAL SUPPLEMENT con The Rivet invention is structurally superi- or to the Reynolds marsh craft for three ressom: (a) vertical bulkheads spaced along the length of the pontoons, adding to the rigidi- ty of the pontoons and creating a plurality The Patent Infringement Robert J. Wilson, Sr., father of the three iudividual defendants, was employed in ear- ly 1974 by Rivet as a contract welder. 50. As a contract welder for Rivet, Robert J. pty e bas bene. , AF te | ye ea telnodea aa ges i Manse Stat tothe eter eS Tah he on ae et Spier Thea tp + ern e Resale tah on 42 nib Naudh Adele va phos Bfrtechasre 7 eney t ye Ae oF 9 wo: Pegg Oe ower 3 mh ne eran Ss a YTS OS EY e pote y “ag? . “ . s- Te et carey se ee ewer. “ — ; p , . e- nee) = oes ot ~ ~ even 7 . >" “ at, bxal oy ee ee ee ee ee ee en - ‘- *@ «° . : ' wh, ote, a a vas ‘- ; * BUTLER @ BINION ALLIED BANK p: - > ak | 519 he had Te 64. Following the filing of this patent in- nee Boe al Pertonne: Peron me: z I i : , : | ($1,000,000.00). fered” Woolson a chance to buy him out for Bucyrus Erie approximately One Million and no/100 Dol- Backhoe F i Hig Tipe pip te a Hite, dial ately Ad We yeep 3 ial $ ‘tant. 3.5 Miae ube fh it mi il f SHITE its ey: HH lial 3% Wa Nee ee TT me isi + atl ih i a EME 3 i le it eee ia eat ELLE TEL 8 2338 : 3 qipsteal [sii ify ved hit fe é visdaatt § a Het Ee | aids PHT HTL Corp., i : f i é i : E "8 a * g z ¢ z ss Calgon 1975). : : : L.Ed.2d 572 (1966); Gaddis v. 506 F.2d 880, 884 (Sth Cir. ee Cee $5 U.S.C. v -— ~ 13. Company v. [6] Anticipation is a technical defense L.Ed.2d 784 which must meet strict standards Uniess Co., 388 U.S. all the same elements are found in substan- 15 LEd2d 545 tially the same situation and united in the 195; Hughes Tool Ca. v. Co., 437 F.2d 1106, 1108 (Sth denied, 408 U.S. 918, 91 S.Ct in a single prior art reference, there is no at Rand 8s “ Let BS. v. Cole, ‘ame way to perform the identical function y Ine, 425 U.S. 47 Compan : He ‘EE r’ a csage , oer (ee er om ~~ TT ee we Lehh at rx : Sabres Seats ane 3S ? ; prey oi Teh a4 vaya a ini stead “ nae Hil A th up i a ; aii! © ha ee? hie > by clear psi es vem ae f m of the patent in suit was anticipated by Southern Implement v. McLemore, 350 F.2d silica a 143 U.S. 275, 284, 12 S.Ct. 444, 447, 96 artof LEd 154 (1802), and party hrm perry fod ‘ 3nf a i HAR jie AE oe a ne ty i; yids as ball J be Lae “y Ht a3 : F gale’ Het y [lnm pale Gli | ed a viel: aie lini i a5* EE “greases? af geet a Ai HERE uel : S°g Are TH iret foi 8 thifin Hi BE ui, te - + Ts 1 wil HBET : rite "HOUSTON, TEXAS 77090 feder- edhe sem in par- ee alism were directly doctrine applied, and (2) diff ARE Fer pebeen st Gtutdd motica to rae ager sorely ine pate! oo be ties to state and federal suits did not KORI CORP. v. WILCO MARSH BUGGIES & DRAGLINES 151 | Cite as 708 F.24 151 (1963) [7,8] Because Fisch) succeeded in locat- : ing the credit bureau and securing a copy of KORI CORPORATION and [luey J. | the report in short order, the district court Rivet, et al, Plaintiffs-Appellees, | determined that. he could not have suffered -_ any actual damages. That does not end the : inquiry before us. Even where no pecuni- WILCO MARSH BUGGIES AND bat ary or out-of-pocket loss has been shown, _ DRAGLINES, INC, et al, | the FCRA permits recovery for humiliation Defendants- appellants. 4s and mental distress, Thompeon v. San Anto- No. 82-3004. ie, alo Rotel Metant Seth. See FS ee ON CES Fame f ports, Ine., 528 F.2d 829 (8th Cir.1976); see Fifth Cireuit. x Evers v. Equifax, 650 F.2d 798 (Sth Cir. June 27, 1988. : 1981), as well as for injury to one’s reputa- ’ : | tion and creditworthiness. Bryant v. TRW, ; Plaintiffs brought action alleging in- eS Inc., 689 F.2d 72 (Sth Cir.1982) (citing Rep- ,. : a resentative Sullivan’s remarks, set forth at gy by defendants of patent No. x * 116 Cong.Rec. 36570 (1970). Negligent °°42785, amphibious marsh is noncompliance with the FCRA entities the ‘Taft snd. defendants counterclaimed ' consumer to an award of actual damages alleging that patent was invalid. The Unit- and reasonable attorney's fees, 15 USC. .. ~e noncompliance in additic District of Louisiana, Robert F. Collins, J., ; voce dau Nakina Sie actnes aes 561 F.Supp. 512, entered judgment for ; a | Section 1681n(2). See Bryant v. TRW; Plaintiffs, and defendants appealed. The ij Thornton v. Equifax, 619 F.2d 700 (8th Seatakgpets, Bil, Cah Sates belt Cir.), cert. denied, 449 U.S. 835, 101 S.Ct , Fe ier a™ gies ie tev athe freee Tar tery tine ae s) ao Phe * A . = ." ? | and Other Users of Consumer Credit informe- tian, 89 Banking LJ. 410, 423 (1971). 152 78 FEDERAL REPORTER, 2d SERIES work in same way, there is no patent antici- pation, 35 USCA § 102(a). misied and has meaningful opportunity to compere pertinent prior art. 35 USCA § 102. me IL Patents ¢=26(1%) g R rt tips ili A i i Hi Bf Kt Ht : H Tust gistic ‘heth- parts. ments sepa- effect > eraft rrying rough { obvi- vatent- ide its parent iffered w first carry- periods nnova- ious to erefore “®@ e which rads for wp-filled ing sub- jon and but cos- senberg. ots ty, New ‘ District KORI CORP. v. WILCO MARSH BUGGIES & DRAGLINES Cite as 708 F.24 181 (1985) Before TUTTLE*, POLITZ and GAR- WOOD, Circuit Judges. POLITZ, Cireuit Judge: .. = The discovery of oil and gas deposits be- neath the marshes and swamps of the Gulf South opened vast vistas, offered many op- and called for a ‘host of new stump-studded swamps, and pressing need In 1974, by defendants’ vehicle. We affirm. Facts unite! al eit behsaiai : cERRLETS § cea ayeete : ot Ste wenbasns Hoek ED es ant eT AN INES ui a fA fi i HN rineies } te H In Tue United States Court of Appeals For Tue Firrn Ciacuit Appeac NO. 82-3619 Kori Corporation, Huey J. River AND Lours Woopson, Plaintiffs-Appellees, Vv. = WiLco MarsH BUGGIES AND DRAGLINES, INC., Joun M. Witson, Sr., DEAN R. WILSON AND Rosert J. WILSON, JR., Defendants-Appellants. eee REPLY BRIEF FOR DEFENDANTS/APPELLANTS Nep L. Conley JerFrey W. TAYON BuTLer & BINION Allied Bank Plaza Houston, Texas 77002 (713) 237-3195 Attorneys for ' Defendants/Appellants oo 68 Vi. Vil. Vill. POPU cicscceccccesccoeeeeecceces KORI, THE NON-EXCLUSIVE LICENSEE, |S NOT ENTITLED TO JOIN IN THE PROSECUTION OF THIS ACTION, SHARE IN ANY DAMAGES OR ESTABLISH —— BASED UPON LOST PROFITS TO one, AND WOODSON ARE ENTITLED ONLY TOA REASONABLE ROYALTY ...... DUE TO THE AVAILABILITY OF NON- INFRINGING SUBSTITUTE PRODUCTS, A “LOST PROFITS” THEOR”’ OF DAMAGES CANNOT BE UTILIZED ..............000e00. DAMAGES CANNOT BE COMPUTED BASED UPON PROFITS GAINED BY THE INFRINGER BUT ONLY PROFITS LOST BY FOG PENI Cbd cbeeicccrdvcccccccss THE AWARD OF EXEMPLARY DAMAGES AND ATTORNEY FEES WAS NOT me ey Sy ee eer A. EXEMPLARY DAMAGES................ (1) ERRORS OF LAW .................. (2) THE “WILLFULNESS” DETERMINATION WAS BASED UPON CLEARLY ERRONEOUS POEAE SESS dbWebs csi venddecsovece ek ee ae THE INDIVIDUAL DEFENDANTS, THE STOCKHOLDERS AND OFFICERS OF THE CORPORATE DEFENDANT SHOULD NOT HAVE BEEN FOUND PERSONALLY LIABLE PRs OUI G00 ck Coduncccvecceccnccce QC hon 65 sAseb Soa baccccccencccecs 69 LIST OF AUTHORITIES PAGE Agrashell, Inc. v. Hammons Products Co., 352 F.2d 443 (8th Cir. ane bal ObROOs Velen bum nat bbb) 0O84sd bacdchases 6% 2,5 Aro Manu Co. v. Convertible Top Replacement Co., 377 U a16 (1564 dpabwtheevekeCotaddeeenccboceeces 6, 11, 16 An One 1 v. Geo. W. Ashlock Co., 339 F.2d Oth © DT cUstins atest Ridaddbvetvrccesss 1 Baumstimier v. Rankin, 677 F.2d 1061, 215 USPQ 575 (Sth Coie SOA MOL thos chide Shas Ftsdabnks cwisedenads 6, 11, 15, 16 Besley-Welles . V. Balax, Inc., 291 F. Supp. 328, 160 USPQ 265 ( . Wis. 1968), aff'd, 421 F.2d t 809, 821, 164 USPQ 485 (7th Cir. 1980) cert. denied. 399 US. 911 [FUE oc canbb das anbbagebek beuewahtahcaveecsvccccec: 21 Birdsall v. Coolidge, 93 U.S. 64 (1876) ............200005. 13, 15 L. L. Brown Pi Co. v. Hydroiloid, Inc., 32 F. Supp. 857, 44 USPQ 655 (S.D. N.Y. 7959), afd, 118 F.2d 674 (2d Ch Gre ienditesebbbcatheddwednesst seee phncnccecs 3,5 Coupe v. Royer, 155 U.S. $65 (1894) .......... yt ee een 6, 13 Creamer v. Bowers, 35 F. 206, (3d Cir. 1888) .............. 7 Crown Die & Tool Co. v. Nye Tool & Machine Works, 261 ele SEY 4 Ndso sos cade teecdsladesdnesaceeses s 2.5 Dangler v. Imperial Machine Co., 11 F.2d 945 (7th Cir. Fees cc checedt taste athtaacitidlensicsbsccess 20, 21, 22 Ellipse Corp. v. Ford Motor Co., 461 F. Supp. 1354, 1379, 201 USPQ 455 (N.D. Ill. 1978), aff'd, 614 F.2d 775 (7th Cir. 1979), cert. denied, 446 U.S. 939 (1980) ............ 7 Eltra . Vv. Basic, Inc., 599 F.2d 745, 202 USPQ 630 (6th Cir. 1979), cert. denied, 444 US. 942 (1979) ............ 16 Foster v. American Machine & Foundry Co., 492 F.2d 1317, 1321, 182 USPQ | (2d Cir. 1974), cert. denied, 419 US. SOD CO Caeser bees abcde md ebak kk cdvbeac cecces 6, 11 Gayler v. Wilder, 51 U.S. (10 How. 477 (1850) ............ 2.5 Pacific Corp. v. United States Plywood Corp., 243 F. Dee, SE es FU BOO hone ccpcvececcvinvevsccvce. 11,13 Graham v. Jeffroy Mfg., Inc., 253 F.2d 72 (Sth Cir. 1958)... 11 Hughes Tool Co. v. F. W. Murphy Industries, Inc., 491 F.2d 923, 180 USPQ 353 (Sth Cir. 1973) .................... Kori Corp. v. Wilco Marsh Buggies and Draglines, Inc., 561 F. Supp. 512 (E.D. La. 1981) ........ te 12, 13, 14, 16, 17, 19 70 Lear v. Adkins, 395 U.S. 653 (1969) .......... 60 eee eeees 22 Maloney-Crawford Tank Corp. v. Rocky Mountain Natural Gas Co., Inc., 494 F.2d 401, 181 USPQ 617 (10th Cir. i SPP er ee Se Oe PRP Re here 2 Mead Johnson & Co. V. Baby's Formula Service, Inc., 402 F.2d 19, 159 USPQ 328 (Sth Cir. 1968) ................. 19 Milgo Electronic Corp. v. United Business Communications, Inc., 623 F.2d 645, 206 USPQ 481 (10th Cir.), cert. denied, OGD UTA TE Gir has sakahios’ cvecde csctevcdvesesces 7, 8, 16 New England Fibre Blanket Co. v. Portland Tele , 61 F.2d 648, 15 USPC 217 (9h Cir. 1932), cert. ied, 289 US. TSS (IDS) «co sccccccccccccaccecgs ep SSesaccedurece 13 Overman Cushion Tire Co. v. aon Tire & Rubber Co.., 59 F.2d 998, 14 USPQ 104 (2d Cir. 1932)............... a,'3 Panduit Corp. v. Stahlin Bros. Fibre Works, Inc., $75 F.2d 1152, 197 USPQ 762 (6th Cir. 1978) .......... 0.6 eeeee. 7,8, 11 Philadelphia Brief Case Co. v. Specialty Leather Products Co., 145 F. Supp. 425, 111 USPQ 180 (D. N.J. 1956) ..... 3 The Pope Manufacturing Co. v. The yas! & Jeffrey Manufacturing Co., et al., 144 U.S. 248 (1892) .......... 2 Powder Power Tool Corp. v. Powder Actuated Tool Co., 230 F.2d 409, 108 USPQ 155 (7th Cir. 1956)................ 21 Rawlings v. National Molasses Co., 394 F.2d 645, 158 USPQ Pe Be Pe ee A ee eee Schreyer v. Casco Products Corp., 97 F. Supp. 159, 88 USPQ 515 (D. Conn. 1951), aff'd as modified on other grounds, 190 F.2d 921, 90 USPQ 271 (2d Cir. 1951, cert. denied, S50 URE. DER COs cc ea cd hen Glow een eek easc tees. 21 Seymour v. McCormick, 57 U.S. (16 How.) 480 (1853) ..... 14 Switzer Brothers, Inc. v. Byrne, 242 F.2d 909 (6th Cir. 1957) 3,5 Trio Process Corp. v. L. Goldstein's Sons, Inc., $33 F.2d 126, 189 USPQ 561 (3d Cir. 1976), cert. denied 449 US. 882 CUED vis banc cached bap aen ti eB ons > Veda tideeOhs © 6wps cs 6, 11,15 Union Carbide Corp. v. Graver Tank & Manufacturing Co., Bee Fae GSS CH Fh id ee KESANE Lash a Reic cess. 15 Waterman Vv. MacKenzie, 138 U.S. 252 (1890) ............. 2.4 Western Electric Co. v. Pacent Reproducer Corp., 42 F.2d 005, 5 UBPD 19S CIR Cik. TORE) oct ccc ce cncwesteeyenn 3, 5 71 ed Se e- =o - -——- -- iv PAGE Wisconsin Alumni Research Foundation v. Vitamin Technologists, Inc., 41 F. Supp. 857, 51 USPQ 345 (S.D. Cal. 1941), d, 146 F.2d 941, 63 USPQ 262 (9th Cir. 1945), cert. ed, SOS Ue BIO (IDES) oon ccccccccccce 21 Zegers v. Zegers, Inc., 458 F.2d 726, 173 USPC 385 (7th Gir.) cert denied, 409 U.S. 878 (1972).................. 7, 11,12 Statutes and Rules Per, MI WA Salo a ciss dc Volek Vow! bob od cnece 5 ep I ER Fh Fold She dviks woelck voce cece ces. 4 ee PEs noo canes bi. bo ldSecie ieech coi. 4 ee EN CEE es on oe ee 11,12 thine cg i, a ee ee 13 Fed. R. Civ. P. Eph TY RAI, act Sia ie SORE ee gaa 19 72 In THE Wnited States Court of Appeals For THe FirtH Circuit APPEAL No. 82-3619 Kori Corporation, Huey J. River AND Louis WOODSON, ot Plaintiffs-Appellees, vs. WiLco MarsH BuGGiEs AND DRAGLINES, INC., JOHN M. WiLson, Sr., DEAN R. WILSON AND ROBERT J. WILSON, JR., Defendants-Appellants. DEFENDANTS’/APPELLANTS’ REPLY BRIEF L S INTRODUCTION At the outset, Defendants-Appellants (hereinafter De- fendants) wish to inform the Court that new counsel, viz, Ned L. Conley of Butler & Binion, Allied Bank Plaza, Houston, Texas, has replaced Mr. Nathan Greenberg. Mr. Greenberg was the author of Defendants’ main brief. Mr. Conley is the author of Defendants’ reply brief and will present oral argument to the Court. This reply brief will focus on six major errors made by the trial court. First, because Plaintiff Kori Corporation (hereinafter “Kori™) is a non-exclusive licensee, Kori is not entitled to join as 73 * . 2 a Plaintiff to prosecute this action, share in any damages or establish damages based upon lost profits to itself. Second, because Plaintiffs-Appellees (hereinafter Plaintiffs) Huey J. Rivet (the patentee and holder of a one-half undivided interest in the patent; hereinafter “Rivet”) and Louis Woodson (the assignee of a one-half interest and the exclusive licensee under the °785 patent’ in issue; hereinafter “Woodson”™) derive their revenues from licensing and not manufacturing, the measure of their damages is a reasonable royalty. Third, due to the availa- bility of non-infringing substitute products, a “lost profits” the- ory of damages cannot be utilized. Fourth, the trial court improperly determined Plaintiffs’ damages by an analysis of profits gained by the infringer instead of profits lost by the Plain- tiffs. Fifth, the award of exemplary damages and attorney fees was not justified. Finally, the individual Defendants, the stockholders and officers of the corporate-Defendant, should not have been found personally liable for damages. Il. KORI, THE NON-EXCLUSIVE LICENSEE, IS NOT ENTITLED TO JOIN IN THE PROSECUTION OF THIS ACTION, SHARE IN ANY DAMAGES OR ESTABLISH DAMAGES BASED UPON LOST PROFITS TO ITSELF The facts are not in dispute. Rivet is the patentee. Woodson is the exclusive licensee and assignee of an undivided one-half ‘United States Patent No. 3,842,785, issued October 22, 1974; this patent is included as the first entry in the accompanying oe which is also entitled “Supplemental Record appendix was in contemplation of the transfer of te appeal to the United States Court of Appeals for the Federal Cir- cuit. An initial volume of “Record Excerpts” was filed with the Defendants’ main brief to the Fifth Circuit containing the docket sheet and judgment appealed from as required by Local Rule 30.1. All reference to the appendix will be by uss of the letter “A”. 74 3 interest in the Rivet patent. Kori is a mere non-exclusive licen- see. See Trial Court Opinion Findings of Fact 6-8, 561 F. Supp. at 514-15. Yet the trial court’s determination of damages is entirely based on Kori’s damages, and not those of Rivet and Woodson.’ These findings were proposed by Plaintiffs (see docu- ment number 127, Plaintiffs’ Proposed Findings of Fact and Conclusions of Law). This was reversible error as a matter of law. It is a matter of hornbook patent law that a non-exclusive licensee is not permitted to join as a plaintiff in a patent infringe- ment suit, is not permitted to share in any assessed damages and, as a consequence, is not permitted to establish damages based upon lost profits to itself. Crown Die & Tool Co. v. Nye Tool & Machine Works, 261 U.S. 25 (1923) (patent statutes are juris- dictional and only the patentee, assignee or grantee may sue for infringement); The Pope Manufacturing Co. v. The Gormully & Jeffrey Manufacturing Co., et al, 144 U.S. 248 (1892) (reaf- firming and quoting extensively from Gayler v. Wilder, infra, and Waterman v. MacKenzie); Waterman v. MacKenzie, 138 U.S. 252 (1890) (a non-exclusive licensee has no title in the patent and no right to sue for its infringement); Gayler v. Wilder, 51 U.S. (10 How.) 477 (1850) (only the patentee or his assignee may sue for infringement); Maloney-Crawford Tank Corp. v. Rocky Mountain Natural Gas Co., Inc., 494 F.2d 401, 181 USPQ 617 (10th Cir. 1974) (one must have title or grant to title to bring a patent infringement action); Rawlings v. National Molasses Co., 394 F.2d 645, 158 USPQ 14 (9th Cir. 1968) (the owner of something less than the right to exclude ? In its opinion on damages, entered eight months later, the trial court indicated that Rivet had granted an exclusive license to Woodson and Kori. 561 F. Supp. at 524. Because of the previous Finding, and since it is impossible for each of two entities to be exclusive licensees in the same geographic area, this must be considered a mere slip of the pen, and not a finding of the trial court. Otaerwise, it would be necessary to remand for a determination of Kori's status. 75 aS. eer ae 4 others, viz, a non-exclusive licensee, may not sue for patent infringement); Agrashell, Inc. v. Hammons Products Co., 352 F.2d 443 (8th Cir. 1965) (regardless of any contractual agree- ments between the parties, ownership of the patent is requisite to the right to sue for infringement and is jurisdictional); Switzer Brothers, Inc. v. Byrne, 242 F.2d 909 (6th Cir. 1957) (court has no jurisdiction over a suit brought by a mere licensee); Overman Cushion Tire Co. v. Goodyear Tire & Rubber Co., 59 F.2d 998, 14 USPQ 104 (2d Cir. 1932) (a sole licensee is not necessarily an exclusive licensee and a non-exclusive licensee has no right to sue and cannot share in damages); Western Electric Co. v. Pacent Reproducer Corp., 42 F.2d 116, 5 USPQ 105 (2d Cir. 1930) (non-exclusive licensee can neither sue along nor join with the patent owner in an infringement suit); Philadelphia Brief Case Co. v. Specialty Leather Products Co., 145 F. Supp. 425, 111 USPQ 180 (D. N.J. 1956) (non-exclusive licensee has no proprietary interest and regardless of any contractual rights, cannot sue on the patent at all); L. L. Brown Paper Co. v. Hydroiloid, Inc., 32 F. Supp. 857, 44 USPQ 655 (S.D. N.Y. 1939), aff'd, 118 F.2d 674 (2d Cir. 1941) (non-exclusive license is merely a right not to be sued and non-exclusive licensee has no right to sue). Title 35, in pertinent part, provides: § 281. Remedy for Infringement of Patent. A patentee shall have remedy by civil action for infringe- ment of his patent (emphasis supplied). 1100. Definitions. d. The word “patentee” includes not only the patentee to whom the patent was issued but also the successors in title to the patentee. The “successors in title to the patentee” refer to the three types of assignees envisioned by the assignment provisions of Title 35. See 35 USC § 261. As explained by the Supreme Court in 76 nated aia ae, 5 Waterman Vv. MacKenzie, supra, a successor in title may be one of three assignees: first, an assignee of the whole patent compris- ing the exclusive right to make, use and sell throughout the entire United States; second, an undivided part or share of that exclusive right; or third, the exclusive right within and throughout a specified part of the United States. Any transfer short of one of these is a non-exclusive license giving the licensee no title in the patent and no ri sue for infringement. /d. Instead, a non-exclusive li simply a contractual right not to be sued by the patentee or his successors in title-for patent infringement. Overman Cushion Tire Co. v. Goodyear Tire & Rubber Co., supra at 1000 (a non-exclusive licensee has merely the right of being protected from actions for infringement); Western Electric Co. v. Pacent Proproducer Co., supra at 118 (non-exclusive license is merely a contractual privilege against a suit for infringement); L. L. Brown Paper Co. v. Hydroiloid, Inc., supra at 868 (a non-exclusive license is merely the right not to be sued). Finally, the right to exclude others from making, using or selling the patented invention (See 35 USC § 154) was unknown to the common law. All such rights and limitations on those rights are created and determined by Federal statute. As such, the trial court’s jurisdiction to hear a patent infringement suit is closely prescribed by statute, and the court is without jurisdiction to hear any patent infringement claim filed by a non- exclusive licensee. Crown Die & Tool Co. v. Nye Tool & Machine Works, supra at 34, 39-41; Gayler v. Wilder, supra at 494; Agrashell, Inc. v. Hammons Products Co., supra at 447; Switzer Brothers, Inc. v. Byrne, supra at 913. Accordingly, Kori was not a proper party plaintiff to the infringerient action, and the trial court had no jurisdiction to consider any claim by or alleged damage to Kori. As stated by the Court of Appeals for the Second Circuit, “Practice of the invention by others may indeed cause [Kori, the non-exclusive 6 licensee,] pecuniary loss, but it does him no legal injury.” West- ern Electric Co. v. Pacent Reproducer Corp., supra at 118. Asa result, damages must be assessed by analysis of the injury to the patentee, Rivet, and his successor in title, Woodson. Il. RIVET AND WOODSON ARE ENTITLED ONLY TO A REASONABLE ROYALTY Rivet, as the patentee and owner of an undivided one-half interest in the patent, and Woodson, as the exclusive licensee and owner of the other undivided one-half interest in the patent, clearly have the right to sue for patent infringement. However, any award of damages must be based on the actual injury to them. Aro Manufacturing Co. v. Convertible Top Replacement Co., 377 US. 476, 504-08 (1964) (the patentee is entitled to “general damages, that is, any damages the complainant can prove, not less than a reasonable royalty . . .”) (hereinafter “Aro II"). Coupe v. Royer, 155 U.S. 565, 582 (1894) (at law, the patentee is entitled to recover, as damages, the loss he has suf- fered). Rivet and Woodson do not manufacture or sell the patented pontoons. Instead, Kori performs these functions as a non-exclusive licensee. Any damage caused by Defendants’ infringement to Rivet and Woodson is, therefore, caused by a loss of royalty revenue. It is axiomatic in the field of patent law that a patent owner or exclusive licensee who does not manufac- ture or sell the patented apparatus is not entitled to damages based upon a “lost profits” theory, but is entitled only to a reasonable royalty. Baumstimler v. Rankin, 677 F.2d 1061, 1072, 215 USPQ 575 (Sth Cir. 1982) (because Baumstimier, the patentee, did not exploit the patented invention — but rather it was informally exploited by a non-exclusive licensee — Baum- stimler had no lost profits); Trio Process Corp. v. L. Goldstein's Sons, Inc., $33 F.2d 126, 129, 189 USPQ 561 (3d Cir. 1976), cert. denied, 449 U.S. 882 (1980) (because Trio was not engaged in the patented metal reclaiming business, the only 78 7 damage Trio suffered was a loss of royalty revenue); Foster v. American Machine & Foundry Co., 492 F.2d 1317, 1321, 182 USPQ | (2d Cir. 1974), cert. denied, 419 US 833 (1974) (because the patentee, a patent attorney by trade, did not exploit the patented invention by either manufacturing and sales or licenses, he was only entitled to a reasonable royalty); Zegers v. Zegers, Inc., 458 F.2d 726, 730, 173 USPQ 385 (7th Cir.), cert. denied, 409 U.S. 878 (1972) (if the patentee does not manufac- ture or sell, then his damages are based upon a reasonable royalty); Creamer v. Bowers, 35 F. 206, 207 (3d Cir. 1888) (a patentce’s damages are determined by the use he makes of the patented invention); Ellipse Corp. v. Ford Motor Co., 461 F. Supp. 1354, 1379, 201 USPQ 455 (N.D. Ill. 1978), aff'd, 614 F.2d 775 (7th Cir. 1979), cert. denied, 446 U.S. 939 (1980) (where the patent holder does not exploit the patent, the only pecuniary loss suffered is the loss of royalties). A corollary to this general principle is the rule that to estab- lish lost sales as a basis for “lost profit” damages, the complain- ant has the burden of proving that it had the manufacturing and marketing capability to meet the demand for the sales lost to the infringer. Milgo Electronic Corp. v. United Business Communi- cations, Inc., 623 F.2d 645, 663, 206 USPQ 481 (10th Cir.), cert. denied, 449 U.S. 1066 (1980); Panduit Corp. v. Stahlin Bros. Fibre Works, Inc., 575 F.2d 1152, 1156, 197 USPQ 762 (6th Cir. 1978) (Opinion by Chief Judge Markey of the then Court of Customs and Patent Appeals, sitting by designation). As indicated, it is undisputed that Rivet and Woodson do not have this capability. The trial court based its award of damages on a “profits” theory’ due to the pecuniary loss felt by Kori and * See Sections |V and V, infra, for a further explanation of why the “profits” theory em by the trial court was erroneous as a matter of law. 79 ee not as a result of the loss of royalty revenue to Rivet and Wood- son. On authority of the latter cases, this was reversible error as a matter of law. Accordingly, as indicated above and in the previous section, any award of damages must be based on the injury caused to those who have a right to sue and not to those who are not proper parties to the action, such as the non-exclusive licensee, Kori. Because Rivet and Woodson do not receive “profits” from the manufacture or sale of the patented pontoons, any damage award to them must be based on their actual injury, a loss of royalty revenue. As a result, the trial court's decision must be reversed, and this case remanded for~-a determination of a reasonable royalty. IV. 7° DUE TO THE AVAILABILITY OF NON-INFRINGING SUBSTITUTE PRODUCTS, A “LOST PROFITS” THEORY OF DAMAGES CANNOT BE UTILIZED If this Court should decide to make new law and determine the damage to Rivet and Woodson by analyzing the pecuniary loss to Kori and applying a “lost profits” theory of damages, the trial court’s decision must, nonetheless, be reversed and remanded for a determination of a reasonable royalty. The law is not in dispute. It is well established, as recited by the trial court, that if non-infringing substitute products are available, a “lost profits” theory of damages cannot be employed. Milgo Elec- tronic V. United Business Communications, Inc., supra at 663; Panduit Corp. v. Stahlin Bros. Fibre Works, Inc., supra at 1156 (opinion by Chief Judge Markey sitting by designation listing four facts which must be established to entitle complainant to “lost profits”); Hughes Tool Co. v. F. W. Murphy Industries, Inc., 491 F.2d 923, 929-30, 180 USPQ 363 (Sth Cir. 1973). However, the trial court's finding that non-infringing substitute products were not available is clearly erroneous. . 9 Contrary to the findings of the trial court, the machinery built by Quality Industries of Thibodaux, Louisiana (hereinafter “Quality”) was considered by the buyer of the machines to be an acceptable substitute for machinery manufactured and sold by Kori under the Rivet "785 patent. There is no question that the Quality machinery is non-infringing. The only question raised is whether the Quality machinery is an acceptable substitute. On this score, the trial court stated: There has been no evidence, however, of the specifications or the working capability of the Quality units. The only evidence of the capability of the products built by Quality is a vaguely worded and self-serving sales brochure. (See Wilco Exhibits 3 and 3a). It is not_even clear whether Qual- ity was marketing a comparable swamp machine during the period of infringement at issue in this case. . . . The evidence indicates that McDermott ‘was interested in machines patented under the Rivet "785 patent from plain- tiff Kori because these were the only machines capable of operating effectively in the jungle swamp of Nigeria. McDermott then became concerned that Kori might not be able to make timely delivery of the machines.... As a result of this concern about the timeliness of delivery, McDermott decided to purchase machinery from the defendant infringer, Wilco. Regardless of whether McDermott’s fears were well founded, the fact remains that when McDermott sought a substitute for the patented Kori product, it turned not to Quality or some other manufac- turer of marsh craft, but to the infringer, Wilco. Thus, from a buyer’s perspective, the only acceptable substitute for the patented Kori machines were the infringing machines. 561 F. Supp. at 526. The trial court, apparently, has overlooked substantial credible, unimpeached testimony and documentary evidence which directly contradicts the latter statements. Regarding availability and comparability of the Qualit, machinery, the trial court only acknowledged Quality’s sales brochure and a=. = a ennai Sabine ie al . sees emda bee - ee = - i ¢ ; a 5 é F : uethee. the jalan ee ae een section ° This sw Todore’ conte Haaan adie EE aeee ataiaas te tonaseer ‘§ Ge congue eee roper court, in the same manner as if r ain : i the com t or appeal had filed in that court in the fiirst in- : stance. This provision, therefore, will allow the CAFC to transfer Fs cases to the circuit court. or vice versa. ; Section 1995 establishes the jurisdiction of the United States Court | of A for the Federal Circuit as follows : ion (a) (1) of new section 1295 of title 28 gives the Court of Appeals for Circuit jurisdiction of appeal in which district court jurisdiction was based, in whole or in part, on section that of district court decisions in cases invol copyrights or and utes af Gn Ghes Lnoes ail enaiageto a eathe Subsection (a) (2) of section 1295 of title 28 gives the Court of Appeals for the Federal Circuit jurisdiction of any appeal from « district court where the jurisdiction of the district court was based, in whole or in part, on section 1346 of title 28, United States Code, Sart St a ee ee eee eee ae chien le tions 1346(e), , or 1346(e), or 1346(c) when the claim is founded on an act of or & regulation for internal revenue, end on sppeet 0 Guat See ee 1346(c) (Tort Claims Act continue to go to regional courts of The Bill saction 1346 te bring all other civil cases in the United FEDERAL COURTS IMPROVEMENT ACT Pil. 97-164 Bi g bry j 333d 3 HE in E24 pail He 1 ie i a je Hie ie ne inl: . rf aE axis pupae 18 u H : i Ege suit - ult HE Meer tr it ai SiN etal Si ara Sebpdaenieg we ie SEeUE sofa sitagubalbaseiars] aftil Sis] alereatea tails ag | Ff #3 $5635 es rit 5 : a23 27 Ba H i ie 3 rag i aut is ni ~ iis ues e Lanne Pattern een confusion o patent and antitrust issues in casee which would be a new ae hae ent ot Sena Se Se © . . . . : + generalized context certain specific pram. weeny ene ee te sheer yee embnge gm er d with patent ften FEDERAL COURTS IMPROVEMENT ACT P.L. 97-164 mum achievement of a major of the bill, the provision of relia- bility and uniformity in the to be applied in patent cases, would require direction of the appeal in those cases to the Court of Appeals in which issues of patent-misuse survive the trial are rare. S. 1700 deals only with appeals. Piegations Ghd any J tig geting p ion at the upon to eliminate such issues at the trial stage. just as they do with : - : beg, Farther sive counterclaim the tiff, which counterclaim might not involve any patent Such a gy te counterclaim might be i court and at the same time solely as a matter of ed ey ae ndyenapalhe ry nae orp eae joinder, wing t patent case would be a tot ‘ourt of A for Lie Pda Cheat aed takki othe cate aed be a to the local circuit, would have aay ans - line of distinction at the trial level. That Wri James Weiize, Legislative Affaire Officer. ~———eom — + . yw i : ! é ; ; i SS ° Tt es he hho} My i dey ton “se ‘eee __ ee eee em eee OF ee 4 eure Ct werd 377". ack o “ok Z. « - Aware ot at . ~ 9 nae Pie Boe wane y grt Tan | atta ae) - - an ~ ve ™ - ) Section 292(e) of title 28, 'Jnited States Code, is amended by striking out “the Court of Claims, the Court of Customs and Patent Appeals or” and by striking out i “§ 293. Judges of the Court of International Trade”. (3) The item relating to section 293 in the section analysis of chapter 13 of title United States Code, is amended to read as follows: ” “T38 Jedges of the Court of Lnternetional Trade.” (4) Section 160(a) of title 28, United States Code, as that section will become effec tire ge Agril 1, 1504, fs amended by ctriking out “sltley" and inserting in lien there Sections at title 28, United is amended out {eee epee | HE S46 a aus ia Hh g4 % Hj Wn | ji EM um if jy wil a iF mh ij agi i 4 i i 4 if ie it TE Ei a Ui ml fe Ral hi saya Heel [0 | fy ee yf ay re i wea if as 5s HTH ie 5 BE HW! af af S Ma 1 i ied eh ie sts ¥4 . ' is fe $3 it #34 fb ~ Fl itt We at iii et re Gime Me Ake a Ma ifn § Tait iF Ee) iyi i i ft Ht ae A ial LH at rf ly He tel i iii iti He thi f het ata Wa gab Wee = GAR eG EE a a : me Fee ae | date Hl | a Hi | ii a it ‘at a 13 il iit it HH ila h ni i all iti ida ileal ita at; [ya La HELE HIRE aE HED Ht tesa, sri f eadaget sd ela ~ 51 in oe Claims Court”. Peete en oe i i ; als al ith : i uu i iar ‘lt in 53x 4 CE ee ee EP pe le in Ueat Unb i ct aaa Bape é at F a re git -22 t tl a4 3 stock Eset: © Sg0t gtlavietd pti feats ae ae 33 HF ital elite unl eh ti Hite HI Va, ea uding out 1292d), “Eicapi as provided in section 1292, Sac. 124. Section 1294 of title 28, United States Code (inci will become effective on that section as Appeals na 13 iG ta aa & 3 $s oe : | i i % ii He i eal ih i 1, atta x33 He it le i 3° : i i iy HL a} th Ha ii ek liye: il] i i i : Pall ip it eb Purr "iF a ; ith i ae j " s i} is iy tlie iF iit i ee te te as Ru He id be Fil Aan ie aw Ae 3 ads let tatig(l a & nl | i iit i : bi Til “aleteidl Geri | Ai | ie ie SA itll 1H eb He i HL He eta el 1 site ti | a HLH Ha! ti pil dlp Fart in Pa tate ts Hl ; : : eee ih? 10 Lew relating to section ats os second piace it appears thereat and i on 23, United States Code, is a:neoded Ee in thereof Claims” the in liew the socond amended States and inserting in lieu thereof “UNITED ae ane of such title, Sad Gea of Code, is snd is ie there of Claims” lieu Court”. United Coda, is “ty! 4" the is amended Site Gains Orr OF CLAIMS” reas item relating to section 1499 in the section analysis of chapter 91, United Mik if. i,t ts ae HLL (90 _Lqumetod daamengee Need ‘rom ceatracters ameer cotrect York Hears Staecderas Act tp read a REPEAL OF PROVISIONS RELATING TO THE COURT OF CUSTOMS AND PATENT APPEALS Sec. 128. (a) Section 1926 of title 28, United States Code, is amended Sac. 127. Chapter 98 of title 28, United States Code, and the item relating ter 93 in the chapter analysis of part [V of such title, are repealed. “= Pane ng ree if en: : i i f i H ity Ca | Ht alg i wl ee i a i i f Intht af aE i , ll ee He ee ae 1 iy me ete Ae: i Ei ma it i GEL a eile te eT ai \ if FEE: f Ho it wh Ha all a il lal Witt i ; ak sual cae . > a ia 3 i? cat ‘ ali ee ata br at hil 147 States Code, is amended by striking out “. o er re F PR PAG) ila HE FH jj ne ae kg Ane REE EEY Spa] Hig 131) ae ty a i it rh hil uf fia % iN: ‘ iE in lip i if thes i Hel Ht ba ay i Frrieierl ey fel ay fig HE yin ifs ; 4 ey J aha dy fell a ny af 3 lf pay iF | + Ls F abba tile tye, 1 i ig “itt sel, r af ‘til Ye ee ~ at aL fi r pil had: nt af ade + Est 4: HEH ay cy tally; itil Hee igen Big aa i cet ti eet TE a I ih RE Ua ec era Ai fay Ua ee al Si Ba a i u a a i : i Urine nt a) ll y 2 GE a al ah eerily i es corer a — ATE jaitogegdt ji boy Wien) Wa E ayes at iH ' i § i ae i Hf eat ee tan tt 1 Ce ee ol Hk i eat Hil ae Ginitin i iitn 171 a 8 i aagey E ae aie i RAT i fay SM a bara "ye Uneehan sd ad 2 dyiesetesd S45 i i agile ry ue ‘ if ia li niet antl 4g 23) 34 HECEE Bay jive He a i Ht rs Be ba ay nt PADRE goa i BeBe fs & if 5 ; 30 ite F : + vite 3 i Hi iyi it 33 distin nF a a i BL dye He , HGH ue Ht if il 172 to o.. by a3 AH a ae B +f) ey 833 fg i gabe u i i i i Se by i Be He E : es aa] ne dy AB Hil cE i te ee dt ur ij istphted oid Gitjacgtis So ghaas all : : een rh: ‘ i Hate lt let Seer ellie ett erence rt will be handled inserts a refi budget of the 28, United section th Claims loyees for the Uni the bill int technical ne emp ina addition to The A: Th ppeals. °s Office. Section 119—Technical Assistants tment of things, that the Administrative Chapter 17 of title 173 ro | ajpe pany He ih int a in zit i ety 13 el Gi rE a a : La syege un ni i the : an ; | a + | if al bith i it He ii ye aide i fiasaft vl ih Silay Hel GT : and ‘a cee P abl i. 174 | eM Fe taal legh ee tf flies a 78 i i He uit ak ae +e ae! Faye he i leat, 1: dat? Lia ut ie rite Uri d Ht : TE lh : i pe lil i iid A tls + ie Hiail ihe ue fad TRH con PRIA en 175 sully Section 125—Jurisdiction of the United States Court of A ids ie BL ines fia | i ae al vehi i SiinuiniH ag sh : all a HF nee na eget HF lies ‘ee secettly the Federal Circuit 176 41 Fears have been expressed that the Court of A aX1) ~ that argue a from part” | a cate Hin i Hine elt ip ih a ult asi ft HF be Ee E = tH it eH stalin r AE Fie i rt : i ie at une is : i us : i icetity | 4 Be for itself t of terested ep cag oan Ey it ah 17? apnesfegtyy Sette i Hes Set Sy cei a sil: re Hel amu Hi Fl ae a L PTH EMAL RE ui ae Ce eel a ae cane) SAMUS ie ci Gel eat i i | i : He He sleet es lt eee Bay auld i re pues Mh Hs 178 t to section 7703(bX1) and 7703(d) of title ae ik aa be hee bE a Irae alae vill st il i Hn ae ‘al fell s i be nike: a5 Ui a 3 Hf : il alive a i ile etl 3 a3 seb yeatas iFek ; Bg i ; i an iin SET ul Hi “geass 34 8S 9% be £4 bapdees i : ee ii i Th iF He) i i bith HHH eh . i ; li iu fat ute fy © e 179 + WU) ie i at ie is te ils i AL HER BGT Hetil i ‘il uae pile Helge iit dials ae pea i fe il i “ath He Th i HE i i Lie ; iP He ha ;. a : Ti Wty it He ae bari ilea d Geil ilu ae i te nea oH 23 tl ijun 4 uy iil ea flags nt ‘iby sls Hie i i 45 section 126 of the bill amends chapter 91 of title 28. United establish the jurisdiction of the United States onment. Fifth, section 1496 of title 28 gives the Claims to render judgment on disbursing officers’ claims. Sixth, section 1497 of title 28 gives the Claims to render t on claims for damages to oyster growers from co authorized dredging operations. Seventh seutien 1498 of title 28 gives the Claims Court jurisdic- tion to determine cases in which the United States is the ultimate Tenth, section 1508 of title 28 gives the Claims Court jurisdiction to render judgment on any set-off or demand by the United Sta Eleventh, section 1505 of title 28 gives the Claims Court . Gon to render judgment on Indian against the United yyiaig ccliea tiki dade R355 : Section 130 of the bill amends Section 131—Plant Variety Protection Office Decisions eee i: of the such appeais 28 U.S.C. 2353 (which in the Court of 131 repeals ppeals jurisdiction over appeals of decisions J A Protection Section Office) since ; ue usively bill, vested exc} dah’! He j glad ie y a want 182 RRA eel i ee Hl me hilt TL He viilits, ne ik ‘i i ne «4 He Hae a al $anait nl a wit é +f | | ilies £3 zylay ts ; Fe é Se cil fu jiaeliit co Hl a net Mint i bt i Hi eae ed eit AE Bly Brea fe i vite 5: 4 eal o e Appeals for the Federal Circuit will not have exclusive jurisdiction to review the decisions of the United States Tax Court. Section 213—. Conforming Section 1302 of the Act of July 27, 1956 Section 214—Amendment Conforming Section 1) of the Contract Disputes Act of 1978 ee Section 214 of the bill conforms the provisions of section &gX1) of the Contract Aah of LENS to setiost the, totnater of Saree? Section 215—Amendment Conforming Section 1c) of the Contract Disputes Act of 1978 vl Section 215 conforms section 10(c) of the Contract Disputes Act of 1978 to reflect the other changes made by the bill. ee mee © aerate se eee woe | he ol a? » ‘es 7 ti pf Eg a 35h a>) 3 cf ot bie it te: Ee ih HUE jj! x5 pH Hil F ; ag i aT Hl 3 2. HES FEL bite . arial it ts : : eh a i ah 3 ri bee tale 5 t | Fu td + Las Yee cp Hedlt s lf ny TA ie . hip ar 4 1? if : 1 Beal iT dinealyt ae i s i: bin iF Latha I ioe 2 aie 8 F cee res ES hap Ha LSE ey 3 18 uly AH te 50 Section 305—Appointment of judges by the President This section indicates the sense of Congress to the President thar he select for nomination to the new Courts—when vacancies Section 306—Effect on Pending Cases This section provides for the orderly disposition of cases pending on the effective date of the bill. The section is fairly detailed because it is the view of the Committee that ambiguities as to effect on pending cases ought to be reduced to a minimum. ion 307—TVA Legal Representrative Section 306 provides that the proposed legislation will not change the provisions of existing law concerning the legal representation of the TVA before any court of the United States. In regard to clause 2(1X3) of rule XI of the Rules of the House of tatives, the committee recognizes that oversight of the F judicial system and the administration of justice is the responsibility of the Committee on the Judiciary. During the 95th Congress (lst session), the committee, acting through the Subcom- mittee on Courts, Civil Liberties and the Administration of Justice, pene J m yt oi Caseuat te a “asian to committee again acting through subcommittee, held seven further days of hearings on improving this country’s patent law system, including the adju- dication of cases in Federal court. During the 97th Congress, the 51 Finally, the proposed legislation—by creating a new Article I iol forum tere os tas nited States Claims Court, which inher- its the trial jurisdiction of the Court of Claims—will provide an upgraded and better organized trial forum for government claims ia Ten Se SRN SITE ee ee en OF Soe Dees ae eee of Representatives, no oversight findings have been mi to the committee by the Committee on Government Operations. New Bupcer AvuTuoriry In regard to clause 2(1X3XB) of rule XI of the Rules of the House of Representatives, the bill creates no new budget authority or increased tax expenditures for the Federal judiciary. INFLATION ‘Lepact STATEMENT Pursuant to clause 2(1X4) of rule XI of the Rules of the House Representatives, the committee feels that the bill will have foreseeable inflationary impact on prices or costs in the opera’ of the national economy. Cost EstrmaTE In regard to clause 7 of rule XIII of the Rules of the House of Representatives, the committee agrees with the cost estimate of the Congressional Budget Office. STATEMENT oF THE CONGRESSIONAL BupceT OFrFicz Pursuant to clause 2(13)(C) of rule XI of the Rules of the House Re mtatives, and section 403 of the Congressional Act of 1974, the following is the cost estimate on H.R. 4482 pre- pared by the Congressional Budget Office. U.S. Concress, CONGRESSIONAL BupcGetT OFFicz, Washington, D.C., November 4, 1981. ae i d e praegue HE lat li he ie 5 ad ie ili 187 i a rel Be 2 Me lighten 94 Rarmonp C. ScHEPPACH (For Alice M. Rivlin, Director). Comaatrez Vor H.R. 4482 was reported favorably by voice vote, with a quorum of Members being present. government. to partially offset that es cost to the Sincerely, On the ata _ e" aH ofl ane rh JUDICIAL HOUSEKEEPING ae HEARING | SUBCOMMITTEE ON COURTS, CIVIL LIBERTIES. AND THE ADMINISTRATION OF. JUSTICE _ OF THE e COMMITTEE ON THE JUDICIARY - - HOUSE OF REPRESENTATIVES NINETY-FIFTH CONGRESS SECOND SESRION ON JUDICIAL HOUSEKEEPING MAY 4, 1978 Serial No. 67 as Printed for the use of the Committee on the Judiciary . . ——-* (ad) On Transree Powers or Feperat Cocrerts (1) April 4, 1977 The Honorable Harold Leventhal Circuit Judge United States Court of Appeals Washington, D. C. Dear Judge Leventhal: Your concurring opinicn in Investment Company Institute v. Board of Governors of the Federal Reserve SyvsS-ea (No. - , D.C. -, January 14, ) was drought to the attention of my Subcommittee by Mr. Robert A. Anthony, Chairman of the Administrative Conference of the United States. In Investment ae Institute you express your hope that the problem pos ry gant filings in the wrong court”... will be dealt with in the reasonable future by the enact- ment of a general statute permitting transdier between Gisetrict courts and courts of appeals in tha interest of justice...." You then suggest 16 U.S.C. 81596 as a possible solution to this problem. In addition to this suggestion, the Administrative Conference has recomended legislation to allow transfers of cases between courts of appeals. I am interested in both of these recommendations, but have several guestions concerning each of then. First, how significant a problem has misfiling and double filing teen for the federal courts? Second, is the proble- confined to situations involving review of administrative agency actions” Third, does the lack of a general transfer statute create an unfair risk to litigants (especially individuals) who file on the federal courts? Fourth, is the Court of Claims statutory scheme the “model” that you would propose if you were a member of Consress? Fifth, has the Jué‘sial Conference considered this problen? Finally, are there any other aspects of transfer th2 >? peals shall, if it be in the interest of justice, transfer such i I oe 203 2 case to any district court in which it could have been brought at the time such case was filed, where the case shall proceed as if it had been filed in the district court on the date upon which it was actually filed in the court of appeals.”. Sec. 2. The chapter analysis of chapter 83 of title 28, United States Code, is amended by adding at the end thereof the following new item: “1995. Transfer to cure defect of jurisdiction.” Sec. 3. Section 1406 of title 28, United States Code, is amended by adding after subsection (b) thereof the following: “(c) If a case within the exclusive jurisdiction of the courts of appeals is filed in a district court, that district court shall, if it be in the interest of justice. transfer such case to any court of appeals in which it could have been brought at the time such case was filed, where the case shall proceed as if it had heen filed in the court of appeals on the date upon which it was actually filed in the district court.” Sec. 4. Subsections (c) and (d) of section 1406 of title 28, United States Code, are redesignated as subsections (d) and (e), respectively. (5) UNITED STATES CouRT OF APPEALs wSTMCT OF coLUNeia @ecurr WASHINGTON, ©. © 20001 a April 26, 1978 Hon. Robert w. Kastenmeie- + Subcommittee on Courts Committee on the Judiciary House of Representatives Washington, D.c. 20515 Dear Congressman Kastenmeier: Thank you for your letter of April 13, concerning 8.R. 11276, 95th Cong., 24 Sess. H.R. 11276 is excellent -- so far as it goes. However, it is limited to transfers be-ween district courts and courts of appeals. In my view, as expressed in my letter to you of October 31, 12977, “Congress Should pernit transfer between any cwo Pederal courts. * That conclusion, along with the underlying correspondence, was transmitted to the United States Judicial Conference by its Committee on Court Aczinistration. At its transfer of cases "from one federal court to another." 7 am So advised by mr. Joseph Spaniol, the deputy Girector of the Pedera) Administrative Office, who has included this language in his Craft of the rerort of the Judicial Confer- ence meeting.) - Although most of the “which court* Toblems that have arisen relate to con=roversies involving the Gistrict court involving the CUStoms court, as incicated in my letter to you of October 31, 1977. Purther, Judge Tamm advises me of the Temporary Emergency Court of Appeals (TECA). (Not- withstanding its name, TECA Was not established @s either a Gistrict court or a Court of appeals. Sec. 211(5) (1) of Pub. L. 91-379, merely provides: “There is hereby created a court of the United States to be known as the Temporary Emergency Court of Appeals, ***." The Chief Justice is authorized to make designations to TECA from judges of the district courts and circuit courts of appeals. See 12 U.S.C. § 1904, note.) Congress may provide in the future for other courts of specialized jurisdiction. These may be created as, say, district courts (as in the case of the special court establishe? under the railroad legislation, 45 U.S.C. § 719). However, as in the case of TECA, they may not be anchored within an existing court, and it would be prudent to provide for that possibility. Such situations may present problems of justice, particularly if novel, and not generally known legislation, should provide strict deadlines for seeking judicial review. There remains a problem of draftsmanship, and more particularly of code placement, since Part IV of Title 28 of the United States Code (IV- JURISDICTION AND VENUE) is now organized with separate chapters for the separate courts. I suggest adding a new chapter, entitled General Provisions (following the model of ch. 57, § 951). I have draftei for your consideration a provision that will effectuate the foregoing. While about it, I decided to try my hance at simplification, and at clarifying that the transfer procedure may be used “to cure a defect of jurisdiction and venue" (as set forth in the title of H.R. 11276). chapter 97. General Provisions § 1591. Transfer to cure defect of jurisdiction or venue If a case is filed in a court of the United States, and that court concludes that there is a defect in jurisdiction or venue, the court shall, if it be within the interest of justice, transfer such case to any court of the United States in which it could have been brough= at the time such case was filed, and the case shall proceed as if it had bees -‘filed in the transferee court on the date upon which it was actually filed in the transferor court. eee Se re | 389 To save time, I am sending a copy of this letter to a mumber of the persons within the Federal judicial system with whom I have discussed the matter, and also to pro- fessors who have evidenced a particular interest in the issue. I am available at your convenience to discuss this matter further with you or any member of your staff. Sincerely yours, pfatt Crttt Barold Leventhal ce: Judge Edward A. Tamm Judge Edward T. Gignoux Hon. Leo Levin, Director, Federal Judicial Center Hon. Joseph Spaniol, Deputy Director, Admin. Office Professor David Currie, U. of Chicago Professor Frank Goodman, U. of Pa. Professor Charles Alan Wright, U. of Texas 390 | | (6) ~ a ce THE UNIVERSITY OF CHICAGO THE LAW SCHOOL itit BAST OTR STRBBT CRICAGO + ILLIMOIS 60637 ~ +e May 4, 1978 Hon. Robert W. Kastenmeier Chairman, Subcommittee on Courts Committee on the Judiciary ‘ House of Representatives oe Washington, D.C. 20515 j 7 Dear Congressman Kastenmeier: I am writing in support of Judge Leventhal's proposed revision of H.R. 11276, 95th Cong., 2d Sess., which would broaden the transfer provision to embrace courts other than district courts and courts of appeals. I share Judge Leventhal's view that filing a case in the wrong-court should not lead to the harsh result of dismissal. I share his conviction that the problem is not limited to district courts and courts of appeals. Finally, I believe the language he has drafted is admirably suited to the purpose. 5 ao, Po Corser. David P. Currie Barry N. Wyatt Professor of Law DPC/mns cc: Judge Harold Leventhal Oo o pad at Note: This opinion will not be published in a printed volume because it does not add significantly to the body of law and is not of widespread legal interest. It is a public record. It is not citable as precedent. The decision will appear in tables published periodically. United States Court of Appenls for the Federal Cirmit ANTHONY P. CATANZARO, ) Appeal No. 83-653 Appellant, ; Vv. HART ELECTRONICS CORP., ) Appellee. ) DECIDED: August 15, 1983 Before FRIEDMAN and NIES, Circuit Judges, and SKELTON, Senior Circuit Judge. PER CURIAM. DECISION The judgment of the United States District Court for the Middle District of Pennsylvania which, in this patent infringe- ment suit, granted a summary judgment of noninfringement and awarded appellee Hart Electronics Corporation of Scranton ("Hart") attorney's fees against the appellant Catanzaro and the plaintiff Molinaro, is affirmed. OPINION The patent involved in this suit issued to Molinaro in 1959. Catanzaro asserts a 50 percent interest in the patent as 209 an assignee. Claim 3 of the patent, which the plaintiffs al- leged Hart infringed, covered a signal seeking receiver. There are two types of such receivers: (1) "termination of signal" receivers that stop their scan in response to a received signal and automatically resume their scan only after the received signal has terminated, and (2) "time interval" receivers in which the device resumes the scan after an interval even though the received signal has not terminated. Molinaro and Catanzaro filed the present suit in 1972. It was one of a substantial number of suits that Catanzaro filed against many electronics companies, charging infringement of the Molinaro patent. One of the other suits Catanzaro filed was in the United States District Court for the District of Delaware against Masco Corporation. Some of these suits were transferred by the Judicial Panel on Multidistrict Litigation to the United States District Court for the Southern District of New York for con- solidated pretrial proceedings before a magistrate. In 1975, che latter court returned the cases to their original district. In 1976, the district court (Judge Stapleton) granted the defendant Masco summary judgment of noninfringement. It held that "the Molinaro patent cannot reasonably be construed as seveeiie signal seeking receivers which restart their scanning only upon termination of the received signal” and that "since _ there is no genuine dispute that the signal seeking receivers produced by Masco restart only in this fashion, i.e., upon 210 termination of signal, Masco is entitled to summary judgment of non-infringement." Catan v. ) ., 423 F. Supp. 415, 445-46 (D. Del. 1976). Om Catanzaro's appeal, the Court of Appeals for the Third Circuit affirmed. Catanzaro v. Int'l Tel. & Tel., 575 F.2d 1085 (3d Cir. 1978). It stated: The record of each of the proceedings below amply demonstrates that the contentions which were taised there and repeated here by the appellant are without merit. Accordingly, we approve Judge Stapleton's well-reasoned opinions insofar as they apply to these appeals. Id. at 1086. » After certiorari was denied in Masco, 439 U.S. 989 (1978), the present suit in the Middle District of Pennsylvania was re- vived. When the district judge originally assigned to this case recused himself, the chief judge of the Court of Appeals for the Third Circuit designated Judge Stapleton (who had pre- sided in the Masco case in the District of Delaware) to hear this case in the Middle District of Pennsylvania. Catanzaro moved that Judge Stapleton recuse himself because of alleged bias and prejudice under 28 U.S.C. § 144 (1976). Judge Stapleton declined to do so. He ruled that the ground upon which recusal was sought related solely to Catanzaro's be- lief that the judge had decided the Masco case incorrectly, and that this ground did not constitute the personal bias and prej- udice that is required for recusal. At a pretrial conference held in May 1981, the plaintiffs admitted that the allegedly infringing receivers of Hart were 211 “termination of signal" receivers. The district court then held that since Masco had determined that in the Third Circuic "as a matter of law, the patent-in-suit cannot be read to ex- tend to termination of signal receivers like those accused in this case[,]" Hart was entitled to a summary judgment of non- infringement. The court pointed out that the court had fol- lowed the same procedure in Masco "where a summary judgment of noninfringement was affirmed." The court rejected Catanzaro's argument that the Masco case should not be binding because he did not have a full and fair opportunity to litigate that case. Judge Stapleton also rejected Catanzaro's renewed motion for his recusal. Hart then applied for an award of attorney's fees of ap- proximately $37,000 for its expenses in defending the present infringement suit. In a detailed opinion, the court held that Hart was not entitled to attorney's fees from the time this suic was filed in 1972 until the Third Circuit mandate in the Masco case issued on May 1, 1978, since during that period the "plaintiffs instituted and maintained this litigation in the subjective, good faith belief that defendant was infringing their patent" and "there were no circumstances during this per- iod of time which would warrant an award of counsel fees despite plaintiffs’ good faith." The court, however, awarded attorney's fees for the period from May 1, 1978. It held that although Catanzaro and Molinaro “still believe that the patent in suit covers termination of 212 signal devices and that the Masco case was simply wrongly de- cided on the merits," "[t]he claim that the Molinaro patent is infringed by termination of signal devices is a legally frivo- lous one." It ruled that once the Third Circuit had decided Masco, and certiorari had been denied, "it became pointless to litigate an identical claim in the Third Circuit and the ex- penses generated by plaintiffs’ resistance to Hart's motion for summary judgment were simply a waste." It concluded: Plaintiffs have thus litigated a frivolous is- sue with no rational hope of success. While they were ee entitled to do so, they were not en- titled to do so at Hart's expense. The circum- stances which have existed in this case since the mandate in the Masco case make this an "exceptional case" within the meaning of 35 U.S.C. § 285 and Hart will be awarded a judgment for the expenses incurred in prosecuting its motion for summary judgment. The court subsequently awarded $4,588.50 in fees and $490.47 in expenses, or a total of $5,078.97. Only Catanzaro has ap- pealed to this court from the district court's grant of summary judgment for noninfringement and award of attorney's fees. Because of the nature of the issues, we determined that there was no need for oral argument. l. On appeal Catanzaro continues to argue that Judge Stapleton should have recused himself, and also contends that the chief judge of the Third Circuit should not have assigned Judge Stapleton to this case because of the judge's prior par- ticipation in the Masco case. We agree with Judge Stapleton, however, that the grounds upon which Catanzaro sought his re- cusal do not establish the personal bias and prejudice that are 213 necessary for recusal. Nor was there anything in Judge Staple- ton's prior participation in the Masco case that made ict inap- propriate to assign him to hear this case. Catanzaro also argues that he did not nave a "full and fair" opportunity (cf. Blonder-Tongue Laboratories v. Univ. of Ill. Found., 402 U.S. 313, 333 (1971)) to litigate his claim of in- fringement. This is but another formulation of Catanzaro's ar- gument that summary judgment of noninfringement should not have been entered. The district court judgment in Masco rested upon the legal determination that the Molinaro patent did not cover termination of signal receivers. Catanzaro has not shown that he did not have a full and fair opportunity to litigate that issue in that case. As Judge Stapleton pointed out in the present case, Catanzaro's argument actually involves only a disagreement with that legal conclusion. The district court correctly pointed out that the Masco de- cision of the Third Circuit definitively established, at least in that circuit, that the Molinaro patent does not cover termi- nation of signal devices. Since the plaintiffs conceded that the alleged infringing devices in this case were termination of signal receivers, and since these devices are not asserted to be different, as far as the question of infringement is / * concerned, from the devices of Hart,~ the district court */ The devices here are, in any event, the same devices held to be non-infringing in other litigation in which the appellant was a party, Sat v. Sears, Roebuck & Co., 498 F. Supp. 818 (S.D.N.Y. ° 214 properly granted summary judgment of noninfringement on the basis of Masco. Catanzaro does not challenge the amount of the attorney's fees awarded. Apparently he contends that this was not an ex- ceptional case under the statute. The decision whether to award attorney's fees in a patent case lies largely within the discretion of the district court. Orthopedic Equip. Co., Inc. v. All Orthopedic Appliances, Inc., Nos. 83-513 and 83-525, slip op. at 20 (Fed. Cir. May 23, 1983); Chemical Const. Corp. v. Jones & Laughlin Steel Corp., 311 F.2d 367, 374 (3d Cir. 1962). We cannot say that the district court abused its dis- cretion in awarding attorney's fees in the unusual circumstances here. 2. Hart suggests that the amount of attorney's fees should be supplemented to cover its costs of defending against this appeal. We decline to do so. 215 of #4 eminent “6 oe ~~” e~ ° ed ee ee ee ee ee Ms . ee United States Patent 1 Rivet (11) 3,842,785 (45) Oct. 22, 1974 [54] AMPHIBIOUS MARSH CRAFT [76] Inventor: Huey Joseph Rivet, 6901 River Rd, Waggaman, La. 70094 [22] Filed: Ang. 30, 1973 [21] Appl. No.: 391,811 [52] US. CG. (S1} Int. CL. 115/1 R, 115/63, 305/25 B60f 3/00 ' (58) Field of Search.......... 115/1 R, 63; 114/66.5 F, 114/.5 F; 305/24, 25, 16; 416/7 [56] References Cited UNITED STATES PATENTS 1,123,230 1/1910 Bowers 115/63 2,397,104 3/1946) = Hait 305/25 2,546,523 3/1951 = Reynolds 11S/1 R 2,294,476 7/1959 = Lindgren 11S/I R 3,306,250 2/1967 Pichford 1IS/I R 3,418,961 12/1966 Gregg 115/1 R 3,680,925 8/1972 Spivy 305/24 3,722,961 3,738,714 i973) (Haley et al 305/25 6/1973 Nem. 305/24 Se eee Firm wih Fame ie ny —Wilkinson, Mawhinney & Theibault SSeS. = AGE) 216 PATENTED OCT 22874 | - 3,842,785 SHEET 1 OF 4 - a. - . a . wt 27—~ ! wk " TLL: | ttl] ry Le 6 i 217 . PATENTED ocT22674 - = 3,842,785. SHET 20 4 nee 2 _— ore ne « FIG. 3 lor-—! | FIG.& ev. 2a? 2A a a) mie Ii) |= Nd vig aamrilaaia | Ret 218 ty . ‘ as alte earhaneandh ~~ mw = « may be of polypropylene to reduce both wear and fric- tion. Hl iH ry i i 3 Hi dit ij TF it Hh in wherein coefficient of Wi a i uti HF 3. .\n amphibious craft as claimed in claim 2 nlastic support Slocks are of a low ie tt 7 Ma a At i iS 8s ayo tag ving a ving a substantially uniform verti a octal best aonatine comprising 8 pair of egaced pontoons, each pontoon comprisi 1 mary buoyant closed wall structure ha er the length of said bottom and ha ht “48 it ld i attaching The propulsion mechanism for the vehicle is a eguelin over at least half its length measured from rear 45 ront, vertical buikhn ads spaced along the length of 1, An amphibious craft said pontoons adding rigidity to the between said vertical bulkheads ov elongated sant ak free end. fr sem ooo mot ten PIG ance bot to drive each pontoon independen hei to STATUTES AND RULES IN ISSUE In 1958, the pertinent provisions of United States Code, Title 28 were as follows: Section 1291 -- § 1291. Final decisions of district courts. The courts of appeals shall have juris- diction of appeals from all final decisions of the district courts of the United States, the United States District Court for the District of the Canal Zone, the District Court of Guam, and the District Court of the Virgin Islands, except where a direct review may be had in the Supreme Court. June 25, 1948, c. 646, 62 Stat. 929; Oct. 31, 1951, c. 655, § 48, 65 Stat. 726; July 7, Section 1292 -- § 1292. Interlocutory decisions. (a) The courts of appeals shall have jurisdiction of appeals from: (1) Interlocutory orders of the district courts of the United States, the United States District Court for the District of the Canal Zone, the District Court of Guam, and the District Court of the Virgin Islands, of or the judges thereof, [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385011_0916%3A2. Public record. Not legal advice.