Petition for Writ of Certiorari — Cambridge Wire Cloth Co. v. Laitram Corp.

a st baurt, U.S.

: or. supreme Court, U |

¥§8 FILED

MAY 3O 1986

= SPANIOL, JR.

No. JOSEPH aay

IN THE

Supreme Court of the Gnited States

OCTOBER TERM, 1985

THE CAMBRIDGE WIRE CLOTH COMPANY,

Petitioner,

THE LAITRAM CORPORATION AND INTRALOX, INC.

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

KEVIN E. JOYCE

(Counsel of Record)

CUSHMAN, DARBY & CUSHMAN

1615 L Street, N.W.

Eleventh Floor

Washington, D.C. 20036

Tel: (202) 861-3000

Attorney for Petitioner

The Cambridge Wire Cloth Company

PRESS OF BYRON S. ADAMS, WASHINGTON, D.C. (202) 347-8203

QUESTION PRESENTED FOR REVIEW

The question presented is whether the Court of Appeals

for the Federal Circuit erred in not holding as clearly

erroneous the District Court’s finding of patent validity,

a finding which ignored the admission of the patent’s co-

inventor that the broadest claim of the patent is completely

anticipated by prior art.

PARTIES TO THE PROCEEDING BELOW

The captioned parties in this Court are the parties

to the proceeding below.’

' These parties also are those who would ceonstitute the listing

required by Rule 28.1.

TABLE OF CONTENTS

Page

QUESTION PRESENTED FOR REVIEW .........ccccccceeceeeees i

PARTIES TO THE PROCEEDING BELOW ........ccccccceeeeeee i

SABLE OF CONTENTS wincncccansueeee il

ZABLE OF AUTIORITIBS | odsescecccssss ste ili

REPORTS OF OPINIONB ciccscuissniicamecne ee 2

PURISIICTION iccscdicicsuctsecgneancasaenelee 2

STATUTE AND RULE OF CIVIL PROCEDURE

ENVOLVED ©. inencisnacsucvenvucdesaeasasnaeeeee ee 2

STATEMENT OF THE CASE. o0.ccuGucee 3

BRGUMENT occsccccerddscnersunneeeeeee 5

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APPENDIX

A. Decision of the United States Court of

Appeals for the Federal Circuit (March 8,

SOG) wssscsinssenennspnnnadionsdeccaeeeue ee een la

B. Order by the United States Court of

Appeals for the Federal Circuit (April 28,

IGG) sscicsisssdeceunsatorspeecee eee PRI 8a

C. (Edited) Transcript of Oral Opinion of the

United States. District Court for the Dis-

trict of Maryland (March 19, 1985) ......... 9a

D. Judgment of the United States District

Court for the District of Maryland (March

BD, EGBG) | ....cccsonsessssnesncnnnelleaeeeene 50a

E. Claim 19 of Patent 3,870,141 Compared

with the Preferred Embodiment of Ger-

man Patent 113,669—Malard ................... 53a

F. Excerpts from Joint Appendix in Appeals

Nos. 85-2247 and 85-2248 (Testimony of J.

M. Lapeyre, SP.) senccisctsatecueen eee 56a

iil

TABLE OF AUTHORITIES

CASES:

Ditto Inc. v. Minnesota Mining & Mfg. Co., 336 F.2d

iia a cakssecapisnaseavssanvecanensrersees

EWP Corp. v. Reliance Universal Inc., 755 F.2d 898

aa acces sacipiisnbndbansanskeseys

In re Umbricht, 404 F.2d 386 (CCPA 1968) Saves

Kalman v. Kimberly-Clark Corp., 713 F.2d 760 (Fed.

Tee cits wiidendanbneenshebstianaens

Laitram Corp. v. Deepsouth Packing Co., Inc., 406

NR oo as condi cds tananncnesbnasaabunsesvenses

Lindemann Maschinenfabrik GmbH v. American

Hoist & Derrick Co., 730 F.2d 1452 (Fed. Cir.

Ne aces cehsas danas tishncnstuseasajenaveteantn

Skil Corp. v. Lucerne Products, Inc., 684 F.2d 346

ss sss nae cncvenaseyapenevecsegnaaneinesnes

Timely Products Corp. v. Arron, 523 F.2d 288 (2d

i ocala sccdshevsusabivldsecnseannsod

United States v. United States Gypsum Co., 333 U.S.

eric tia ici caxenehdcaessiaadsbeesansiacseces

STATUTES

ED i oigisccgnsdcccasvanckdncasnusnacnsavnsnaneeccexeas

TN cn cssnassaunassscdcssencsswncvascesancsconnvens

a ccaccnnanininasatcdesacansasanecenssnensveeses

I MN cs ccna vndaescavancestnensnecbacessoessexaccasnnsnnsuens

RULES

Federal Rule of Civil Procedure 52(a) ................00088

Page

9

6

6

6

7

fd A |

a

IN THE

Supreme Court of the United States

OCTOBER TERM, 1985

No.

THE CAMBRIDGE WIRE CLOTH COMPANY,

Petitioner,

Vv.

THE LAITRAM CORPORATION AND INTRALOX, INC.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

Petitioner, The Cambridge Wire Cloth Company,

prays that a writ of certiorari be granted to review

the March 3, 1986 decision of the United States Court

of Appeais for the Federal Circuit, adhered to by the

April 28, 1986 denial of a timely petition for rehear-

ing.*

° The appellate court’s decisions are appended as items A and

B, respectively. Reference to the Appendix is by page. For ex-

ample, Appendix A commences at la, and Appendix B begins

at 8a.

2

REPORTS OF OPINIONS

The March 19, 1985 decision of Magistrate Frederic

N. Smalkin is reported at __F. Supp.__, 226

USPQ 289 (D. Md. 1985).

The March 3, 1986 decision of the United States

Court of Appeals for the Federal Circuit is reported

at 785 F.2d 292, 228 USPQ 935 (Fed. Cir. 1986).

JURISDICTION

Petitioner seeks review of the March 3, 1986 de-

cision of the Court of Appeals, adhered to by the

April 28, 1986 denial of a petition for rehearing.

Jurisdiction of this Court is founded on 28 U.S.C.

1254(1) and 28 U.S.C. 2101(c).

STATUTE AND RULE OF CIVIL

PROCEDURE INVOLVED

United States Code, Title 35—Patents

§102. Conditions for patentability; novelty and loss of right

to patent

A person shall be entitled to a patent un-

less—

(a) the invention was known or used by

others in this country, or patented or de-

scribed in a printed publication in this coun-

try or a foreign country, before the invention

thereof by the applicant for patent,. . .

Federal Rules of Civil Procedure

Rule 52. Findings by the Court

(a) Effect. [Effective until August 1, 1985.]

In all actions tried upon the facts without a

jury or with an advisory jury, the court shall

find the facts specially and state separately

its conclusions of law thereon, and judgment

shall be entered pursuant to Rule 58; and in

granting or refusing interlocutory injunctions

the court shall similarly set forth the findings

of fact and conclusions of law which consti-

tute the grounds of its action. Requests for

findings are not necessary for purposes of

review. Findings of fact shall not be set aside

unless clearly erroneous, and due regard shall

be given to the opportunity of the trial court

to judge of the credibility of the witnesses.

The findings of a master, to the extent that

the court adopts them, shall be considered

as the findings of the court. It will be suf-

ficient if the findings of fact and conclusions

of law are stated orally and recorded in open

court following the close of the evidence or

appear in an opinion or memorandum of de-

cision filed by the court. Findings of fact and

conclusions of law are unnecessary on deci-

sions of motions under Rules 12 or 56 or any

other motion except as provided in Rule 41(b).

STATEMENT OF THE CASE

A patent infringement action was brought by The

Laitram Corporation against The Cambridge Wire

Cloth Company (‘“‘CWC’’) in the United States District

Court for the District of Maryland. Jurisdiction was

based on 28 U.S.C. 1838(a).

At the commencement of trial, Intralox, Inc., a

wholly-owned subsidiary of The Laitram Corporation,

was added as a co-plaintiff.» The parties consented to

the case being tried before a Magistrate. At the con-

clusion of a 9-day trial, the Magistrate delivered an

oral bench opinion (Appendix C, at 9a). As it pertains

to this petition, the Magistrate determined that the

broadest Claim 19 of Laitram’s Patent 3,870,141 (the

‘141 patent) is valid and infringed by two plastic belt-

ing products marketed by CWC.

During trial, Mr. J. M. Lapeyre, Sr. testified on

behalf of Laitram as its technical expert. Mr. Lapeyre

is a co-inventor of the ’141 patent. Additionally, he

is Laitram’s President and has received personal roy-

alties in excess of a million dollars from Laitram’s

sales of products incorporating what is claimed in

141.

During cross-examination, Mr. Lapeyre was inter-

rogated concerning the relationship of Claim 19 of

the '141 patent to an embodiment of the invention

disclosed in a prior art German Patent 113,669 issued

to one Malard. Mr. Lapeyre admitted as follows:

“Q. [W]ould you agree that each of the ele-

ments of Claim 19 therefore would find

correspondence in such a version of Ma-

lard?

“A. Yes.

“Q. And haven’t you just agreed with me,

sir, that the Malard patent completely

anticipates Claim 19 of your ‘141 patent?

3 Hereinafter. Laitram and Intralox will be referred to collec-

tively as ‘“Laitram”.

ov

“A. It’s yes. It’s certainly pertinent.”

This unequivocal testimony never was repudiated.

The Magistrate ignored Mr. Lapeyre’s admission

against his substantial interest in the outcome of the

case, concluding instead that CWC failed to show by

clear and convincing evidence that Malard sugg¢ sted

to one ordinarily skilled in the art the combination

of elements that eventually resulted in ‘141. (Appen-

dix, at 24a).

The Court of Appeals for the Federal Circuit sum-

marily affirmed the Magistrate. In doing so, it also

ignored Mr. Lapeyre’s admission that Malard com-

pletely anticipates Claim 19 (Appendix, at 4a):

“CWC did not otherwise show that Malard

would have been considered important to the

PTO. Similarly, the Malard reference neither

anticipates nor renders obvious any of Lai-

tram’s patents.”’

CWC’s petition for rehearing was denied (Appen-

dix, at 8a).

ARGUMENT

By totally disregarding the uncontroverted admis-

sion against interest of the co-inventor, Mr. Lapeyre,

the appellate court has so far sanctioned a departure

from the accepted and usual course of judicial pro-

ceedings by the Magistrate as to call for an exercise

of this Court’s power of supervision.

Anticipation of a patent claim by a prior art ref-

erence is a factual determination. Lindemann Mas-

ccc aaa aa ceili

chinenfabrik GmbH v. American Hoist & Derrick Co.,

730 F.2d 1452, 1458 (Fed. Cir. 1984). Anticipation

occurs when a single prior art reference expressly or

inherently discloses each and every element of a

claimed invention. Kalman v. Kimberly-Clark Corp.,

713 F.2d 760, 771 (Fed. Cir. 1988).

Federal Rule of Civil Procedure 52a provides that

a finding of fact shall not be set aside unless clearly

erroneous. A finding is “‘clearly erroneous’’, however,

when although there is evidence to support it, the

reviewing court on the entire evidence is left with

the definite and firm conviction that a mistake has

been made. United States v. United States Gypsum

Co., 333 U.S. 364, 395 (1948).

There is no dispute that German Patent 113,669—

Malard was patented before the invention claimed in

Laitram’s Patent 3,870,141. Consequently, Malard is

prior art under 35 U.S.C. 102(a).

It also is uncontroverted that Malard discloses two

embodiments of his invention. The preferred embod-

iment is both described in the patent and illustrated

in its drawings. The alternative embodiment is de-

scribed but not illustrated.

The Magistrate limited his consideration of Malard

to the illustrated embodiment (Appendix, at 24a). In

so doing he erred, for it is well settled that a prior

art patent is a reference for all that it discloses,

including non-preferred embodiments. In re Umbricht,

404 F.2d 386, 390 (CCPA 1968) and EWP Corp. v.

Reliance Universal, Inc., 755 F.2d 898, 907 (Fed. Cir.

1985). Furthermore, the Magistrate never compared

what Malard discloses with what is called for in Claim

19.

7

At trial, Mr. Lapeyre first admitted that each ele-

ment recited in Claim 19 of the ’141 patent is found

in the preferred embodiment of Malard illustrated in

Fig. 9 of that patent, but during re-direct examina-

tion, he sought to evade this admission.‘

Mr. Lapeyre’s testimony was unequivocal and un-

repudiated, however, concerning Malard’s alternative

embodiment (Appendix F, at 58a):

“Q. [Would you agree that each of the ele-

ments of Claim 19 therefore would find

correspondence in such a version of Ma-

lard?

‘““A. Yes.

“Q. And haven’t you just agreed with me,

sir that the Malard patent completely

anticipates Claim 19 of your ’141 patent?

“A. It’s yes. It’s certainly pertinent.’’

Mr. Lapeyre’s admission against interest was ig-

nored by the Magistrate. CWC submits that had it

been considered, no fair conclusion could have been

reached other than that Claim 19 is anticipated by

Malard.*

‘An element-by-element comparison between Claim 19 and

Mr.Lapeyre’s initial testimony about the preferred embodiment

is appended hereto (Appendix E, at 53a).

* This is so not only for the reason that Mr. Lapeyre is the

141 co-inventor, but also because of his experience in patent

matters evidenced by his having been granted more than 100

U.S. patents, including those which were the subject of this

Court’s decision in Laitram Corp. v. Deepsouth Packing Co., Inc..

406 U.S. 518 (1972). See Appendix, at 1la.

8

The appellate court summarily affirmed the Mag-

istrate’s determination that Malard does not antici-

pate Claim 19 of ’141 (Appendix, at 3a). Its only

substantive comments concerning Malard occurred

when the court discussed the Magistrate’s findings as

to whether knowledge of Malard would have been

important to the Patent Office’s consideration of the

application for the ’141 patent.® In this connection,

the court stated (Appendix, at 4a):

“Evidence produced at trial shows that

Malard was not considered a pertinent ref-

erence during the prosecution of the Swed-

ish, German, and Dutch counterparts of the

141 patent. Additionally, the patent counsel

who represented Laitram during prosecution

of the ’141 patent testified that he did not

consider Malard pertinent. The Magistrate

found this testimony credible. CWC did not

otherwise show that Malard would have been

considered important to the PTO. Similarly,

the Malard reference neither anticipates nor

renders obvious any of Laitram’s patents.”’

This extract of the appellate court’s decision reveals

that the admission against interest of the ’141 co-

inventor again was completely ignored. The impor-

tance of Malard hardly could be shown more forcefully

than through Mr. Lapeyre’s admission that Malard is

anticipatory prior art which is ‘certainly pertinent’’.

6 Malard admittedly was known to the attorney prosecuting

the ‘141 patent application, but it never was disclosed to the

Patent Office. CWC has contended throughout these proceedings

that Laitram engaged in inequitable conduct by failing to bring

this anticipatory and ‘‘certainly pertinent’’ prior art to the Pat-

ent Examiner's attention.

——————

As to the evidence which the Magistrate and the

appellate court did consider, the legal authority is

overwhelming that patent proceedings in foreign

countries are not controlling in the U.S. because of

differing standards of patentability from country to

country. See, e.g., Skil Corp. v. Lucerne Products,

Inc., 684 F.2d 346, 351 (6th Cir. 1982); Timely Prod-

ucts Corp. v. Arron, 523 F.2d 288, 295 (2d Cir. 1975);

Ditto Inc. v. Minnesota Mining & Mfg. Co., 336 F.2d

67, 71 (8th Cir. 1964). This is especially so in the

present case, for there is no evidence that the claims

of the ’141 foreign counterparts correspond to Claim

19 of the U.S. patent. See Timely Products, at 295.

Thus, in light of the uncontroverted admission of an-

ticipation by Mr. Lapeyre, the appellate court’s ob-

servation that Malard was not considered pertinent

during the prosecution of foreign counterparts to the

141 patent was an inappropriate basis for affirming

the Magistrate’s determination that Malard is not rel-

evant.

Even accepting as credible the self-serving testi-

mony of Laitram’s counsel that he didn’t consider

Malard to be pertinent prior art, such testimony is

of entirely different character, and deserving of far

less weight, than the admission against interest of

the patent’s co-inventor that Claim 19 is completely

anticipated.

The total disregard of Mr. Lapeyre’s admission con-

stitutes fundamental error. Had the Magistrate prop-

erly considered the entire evidence, he would have

weighed Mr. Lapeyre’s unequivocal and unrepudiated

admission that the alternative embodiment of Malard

anticipates Claim 19—a conclusion agreed to by

10

CWC’s technical expert, Mr. Andrews—against non-

controlling determinations of Malard’s relevancy made

by foreign patent offices and the clearly self-serving

statement of Laitram’s counsel. CWC submits that

such consideration could not have led to two permis-

sible views of the evidence. Instead, the fair conclu-

sion would have been inescapable that Claim 19 is

anticipated by Malard.

The appellate court failed to recognize that the

Magistrate did not consider all of the evidence. Con-

sequently, it did not make a competent determination

as to the Magistrate’s having committed clear error.’

CWC petitions this Court for a writ of certiorari,

for it is believed that a review of the entire evidence

will leave the Court with the definite and firm con-

viction that a mistake has been committed.

Respectfully submitted,

KEVIN E. JOYCE

CUSHMAN, DARBY & CUSHMAN

1615 L Street, N.W.

Eleventh Floor

Washington, D. C. 20036

Tel: (202) 861-3000

Attorney for Petitioner

The Cambridge Wire Cloth Company

* The sub silentio disposition of CWC’s challenge to the Mag-

istrate’s monetary award is another indicator of the court’s hav-

ing failed to provide the careful appellate consideration which

justice and fair play dictate.

1]

SERVICE

Three copies of this Petition and its Appendix have

been served on counsel of record for The Laitram

Corporation and Intralox, Inc. by first class mail, pos-

tage prepaid, this 30th day of May, 1986.

KEVIN E. JOYCE

APPENDIX

AG ORE RRRER RE IS SPMRRTT IE + a INT OIRO TI

la

APPENDIX A

UNITED STATES COURT OF APPEALS FOR THE

FEDERAL CIRCUIT

Appeal Nos. 85-2247

85-2248

THE LAITRAM CORPORATION and INTRALOX, INC.,

Appellees/Cross-A ppellants,

.

THE CAMBRIDGE WIRE CLOTH COMPANY,

Appellant/Cross-A ppellee.

DECIDED: March 38, 1986

Before BALDWIN, Circuit Judge, NICHOLS, Senior Cir-

cuit Judge, and BISSELL, Circuit Judge.

BISSELL, Circuit Judge.

This is an appeal from the judgment of the United States

District Court for the District of Maryland, finding U.S.

Patent Nos. 4,159,763 (’763), 3,870,141 ('141),4,051,949

(949) and Re. 30,341 (’841) owned by Laitram Corporation

and Intralox, Inc. (collectively called Laitram) valid and

infringed by products produced by Camoridge Wire Cloth

Company (CWC). The magistrate’s opinion is reported at

226 USPQ 289 (D.Md. 1985). We affirm in part, reverse

in part, and remand.

2a

BACKGROUND

Laitram asserted at the trial that the four patents men-

tioned above were infringed by CWC’s products. Three of

the patents, ’141, 949 and ’763, relate to modules for the

construction of plastic conveyor belts. The fourth patent,

’341, pertains to a drive system adapted for the conveyor

belts embodied in the ’141, ’949 and ’763 patents. Two

CWC conveyor belts said to infringe the Laitram patents

are the close rib (CR)-product and the perforated top (PT)-

product. The magistrate, after a bench trial, held all the

patents valid, i.e., that CWC failed to establish invalidity

with facts supported by clear and convincing evidence. The

magistrate found that the CR-product infringed claims 1,

2, 10, 11, 15, 19, 20 and 21 of the ’141 patent, claims 21,

22 and 24 of the ’949 patent, and claims 1, 2 and 4-8 of

the ’763 patent. The magistrate further found that the PT-

product infringed claims 19-21 of the ’141 patent and claim

8 of the ’763 patent and that use in a conveyor drive

system of CWC’s sprocket and non-circular drive shaft

assembly infringed claims 1, 2 and 3 of the 341 patent.

The magistrate denied Laitram’s request for a finding of

willful infringement and an award of attorney's fees under

85 U.S.C §§ 284 and 285. The magistrate awarded dam-

ages and an injunction but denied prejudgment interest on

the damages award,

The issues presented in this appeal are whether the

magistrate erred in concluding that the patents in suit

were not shown to be invalid or clearly erred in finding

the claims of the patents infringed but not willfully, and

whether prejudgment interest on the damages award was

properly withheld.

We see no error in the magistrate’s determination on

validity and reject CWC’s allegations that the magistrate’s

findings on infringement and willful infringement were

clearly erroneous. We further conclude that the magistrate

neces

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piake idk

3a

abused his discretion in withholding prejudgment interest

on the damages award.

The issues presented in this court were thoroughly

treated in the magistrate’s opinion. Of all the allegations

made in this appeal concerning the invalidity and non-

infringement of the Laitram patents, it is necessary to

address only CWC’s argument that inequitable conduct in

the procurement of the ’141 patent renders unenforceable

all the patents in suit. CWC asserts that German patent

No. 113,669 (Malard) anticipated claims 19-21 of the ’141

patent and Laitram’s failure to disclose Malard to the PTO

renders the ’141 patent, and the related ’763, 949, and

’341 patents unenforceable. The magistrate rejected that

argument and we agree.

In American Hoist & Derrick Co. v. Sowa & Sons, Inc.,

725 F.2d 1350, 220 USPQ 768 (Fed. Cir.), cert. denied, -

U.S. —_., 105 S.Ct. 95, 224 USPQ 520 (1984), this court

articulated a balancing test for determining whether con-

duct during prosecution of a patent application renders the

resulting patent unenforceable. In balancing the materi-

ality of the withheld prior art against the level of intent

with which the prior art was withheld from the Patent

and Trademark Office (PTO), this court stated:

[W]here an objective “but for’’ inquiry is satisfied

under the appropriate standard of proof, and al-

though one is not necessarily grossly negligent

in failing to anticipate judicial resolution of va-

lidity, a lesser showing of facts from which intent

can be inferred may be sufficient to justify hold-

ing the patent invalid or unenforceable, in whole

or in part. Conversely, where it is demonstrated

that a reasonable examiner would merely have

considered particular information to be important

but not crucial to his decision not to reject, a

showing of facts which would indicate something

more than gross negligence or recklessness may

4a

be required, and good faith judgment or honest

mistake might well be a sufficient defense.

Id. at 1363, 220 USPQ at 773.

CWC erroneously argued that Argus Chemical Corp. v.

Fibre Glass-Evercoat Co., Inc., 759 F.2d 10, 225 USPQ

1100 (Fed. Cir.), cert. denied, __U.S. __, 106 S.Ct. 231

(1985), held that subjective “good faith” is never a defense

to a claim of inequitable conduct. Rather, Argus supports

the position that the level of intent is balanced against

the materiality of the prior art in question. In Argus, the

withheld information was the inventor’s own sales which

are material to the § 102(b) time bar. This sales infor-

mation was known by counsel and counsel should have

known that it was material to the examiner in resolving

any § 102 questions. Good faith did not negate this ine-

quitable conduct.

However, these facts are distinguishable from Argus and

the balance achieved here is more analogous to the balance

achieved in Vandenberg v. Dairy Equipment Co., 740 F.2d

1560, 224 USPQ 195 (Fed. Cir. 1984). In Vandenberg, the

district court relied upon the nondisclosed device in reach-

ing its conclusion of obviousness, demonstrating its ma-

teriality. No inequitable conduct was found in Vandenberg

because there was no clear and convincing evidence of

culpability. Jd. at 1568, 224 USPQ at 200.

Evidence produced at trial shows that Malard was not

considered a pertinent reference during the prosecution of

the Swedish, German, and Dutch counterparts to the '14]

patent. Additionally, the patent counsel who represented

Laitram during prosecution of the '141 patent testified

that he did not consider Malard pertinent. The magistrate

found this testimony credible. CWC did not otherwise show

that Malard would have been considered important to the

PTO. Similarly, the Malard reference neither anticipates

nor renders obvious any of Laitram’s patents. Therefore.

the necessary threshold showing of materiality has not

\

:

5a

been made. J.P. Stevens & Co. v. Lex Tex, Ltd., 747 F.2d

1558, 2232 USPQ 1089 (Fed. Cir. 1984), cert. denied,

U.S. ——., 106 S.Ct. 73 (1985). Accord Atlas Powder Co.

v. EJ. du Pont De Nemours & Co., 750 F.2d 1569, 224

USPQ 409 (Fed. Cir. 1984).

Additionally, CWC has failed to identify any evidence

which negates the magistrate’s determination that the pa-

tentee of the Laitram patent lacked culpable intent in fail-

ing to disclose Malard to the PTO. The magistrate found

the prosecution counsei’s testimony that he had no intent

to deceive the PTO by not disclosing Malard’s existence

credible and found no evidence of either conscious intent

to deceive or gross or wanton neglect or misconduct.

CWC’s assertion that Laitram withheld other informa-

tion contained in the corresponding Swedish patent appli-

cation, specifically French Patent 24,295 (Albinet), is

specious. CWC knew of the Swedish patent appiication as

early as 1980 when the '141 patent prosecution history

was examined during license negotiations. During trial,

CWC could have requested the production of the Swedish

patent application but, in fact, decided not to require its

production. CWC cannot for the first time, without any

evidence produced at trial, develop in its reply brief an

allegation of fraud. See Studiengesellschaft Kohle, m.b.H.

v. Dart Industries, Inc., 726 F.2d 724, 220 USPQ 841 (Fed.

Cir. 1984) (which sustained a finding of no fraud where

there was no testimony on the fraud issue at trial, and

the documentary evidence was conflicting, and the fraud

defense was first developed in defendant’s post-trial brief);

Cf. S.C. Johnson & Son, Inc. v. Carter-Wallace, Inc., 781

F.2d 198, 228 USPQ 367 (1986) (where it was not an abuse

of discretion in the district court’s ruling that, because,

defendant “unduly delayed’’ raising inequitable conduct,

defendant could not adduce evidence on it); Bio-Rad Lab-

oratories, Inc. v. Nicolet Instruments Corp., 739 F.2d 604,

222 USPQ 654 (Fed. Cir.) cert. denied, __U.S. —_ , 105

S.Ct. 516 (1984) (defense of a misuse based on a patent

6a

licensing was not considered on appeal because untimely);

But see Thompson-Hayward Chemical Co. v. Rohm & Haas

Co., 745 F.2d 27, 223 USPQ 690 (Fed. Cir. 1984) (where

because of the unique facts and policy considerations of

the case, this court allowed the inequitable conduct defense

to be raised for the first time on appeal).

PREJUDGMENT INTEREST

The Supreme Court in General Motors Corp. v. Devex

Corp., 461 U.S. 648, 654, 217 USPQ 1185, 1188 (1983),

concluded that prejudgment interest should ordinarily be

awarded affording patent owners complete compensation.

The Court in Dever did not articulate this holding in a

vacuum, but provided guidelines to the boundary of “‘or-

dinarily”’ by stating:

[Section 284] states that interest shall be “fixed

by the court,” and in our view it leaves the court

some discretion in awarding prejudgment inter-

est. For example, it may be appropriate to limit

prejudgment interest, or perhaps even deny it

altogether, where the patent owner has been re-

sponsible for undue delay in prosecuting the law-

suit. There may be other circumstances in which

it may be appropriate not to award prejudgment

interest.

Id. at 656-57, 217 USPQ at 1189 (footnote omitted); see,

e.g., Gyromat Corp. v. Champion Spark Plug Co., 735 F.2d

549, 222 USPQ 4 (Fed. Cir. 1984). CWC failed to provide

this court or the trial court with any circumstances which

excuse prejudgment interest on awarded damages. Con-

sequently, we find that the magistrate abused his discre-

tion by failing to award prejudgment interest. Therefore,

the magistrate’s denial of prejudgment interest is reversed.

The case is remanded for entry of an amended judgment

awarding an amount of prejudgrmnent interest as deter-

mined by the magistrate.

7a

AFFIRMED-IN-PART, REVERSED-IN-PART, AND RE.

MANDED

8a

APPENDIX B

UNITED STATES COURT OF APPEALS FOR THE

FEDERAL CIRCUIT

Appeal Nos. 85-2247

85-2248

THE LAITRAM CORPORATION and INTRALOX, INC.,

Appellees/Cross-A ppellants

We

THE CAMBRIDGE WIRE CLOTH COMPANY,

Appellant/Cross-A ppellee

Before BALDWIN, Circuit Judge, NICHOLS, Senior Cir-

cuit Judge, and BISSELL, Circuit Judge.

ORDER

A suggestion for rehearing in banc having heen filed in

this case,

UPON CONSIDERATION THEREOF, it is

ORDERED that the suggestion for rehearing in banc is

declined.

FOR THE COURT

/s/ Francis X. Gindhart

FRANCIS X. GINDHART

4/28/86

Date

ec: Mr. Kevin E. Joyce

Mr. Paul J. Hayes

a ttt i tl i il a

9a

APPENDIX C

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MARYLAND

CIVIL NO. HAR 83-3126

THE LAITRAM CORPORATION and INTRALOX, INC.,

Plaintiffs,

Vv.

THE CAMBRIDGE WIRE CLOTH COMPANY,

Defendant.

(EDITED) TRANSCRIPT OF ORAL OPINION

This is a patent case that was filed on August 31, 1983,

in which the plaintiffs, The Laitram Corporation (Laitram)

and Intralox, Inc., a wholly-owned subsidiary of Laitram,

brought suit on four patents against the defendant, Cam-

bridge Wire Cloth Company (Cambridge). The plaintiff cor-

porations are the owners or assignees of the patents in

suit. Specifically, the patents are, first, U.S. Patent

3,870,141, issued to Lapeyre and Lapeyre, assigned to The

Laitram Corporation, issue date March 11, 1975. The sec-

ond patent in suit is U.S. Patent Reissue 30,341, issued

to James M. Lapeyre, assigned to The Laitram Corpora-

tion, issue date July 22, 1980. The third patent is US.

Patent 4,051,949, invented by Lapeyre, assigned to The

Laitram Corporation, issue date October 4, 1977. The

fourth patent is U.S. patent 4,159,763 issued to Kewley

& Demarest, and assigned to The Laitram Corporation,

issue date July 3, 1979. Three of the patents, that is, 141,

’949 and ’763 relate to modules for the construction of

modules and of modular conveyor belts useful for the han-

10a

dling of materials and other industrial applications. The

fourth patent, the ’341 reissue patent, pertains to a

sprocket drive wheel fitted to a square shaft, adapted to

the purpose of driving conveyor belts, especially those made

up of modules such as those embodied in the 141 and

’949 and ’763 patents. The defendant claims, first, that

there is no literal infringement an no infringement by the

doctrine of equivalents as to all the patents, with the ex-

ception of reissue ’341. The defendant also claims as to

all the patents that they are invalid, as having been im-

properly issued in light of prior art that rendered these

inventions obvious or that anticipated these inventions. The

defendant also claims that, with regard to the patent ’763,

claim 8 thereof is invalid under section 112 of Title 35 for

lack of specificity. The defendant has also counterclaimed,

raising three counterclaims. The first two are basically

seeking declaratory judgmer:ts of invalidity as to the pat-

ents in suit. The third is that this is sham litigation and,

therefore, that the defendant is entitled to judgment in

its favor on the three counterclaims. Additionally, the

defendant has set up, with regard to the ’141 patent, a

claim of inequitable conduct, as recognized in such cases

as J.P. Stevens v. Lex-Tex, 747 F.2d 1553 (Fed. Cir. 1984).

This case came on for trial before me for nine days in

February and March of 1985, on consent of the parties

pursuant to 28 U.S.C. § 636(c), as amended. Evidence was

taken in the form of testimony, expert and otherwise, and

somewhere in the neighborhood of 300 exhibits, including

physical exhibits, charts, diagrams, patents, and corre-

spondence, as well as miscellaneous demonstrative evi-

dence, were introduced into the record. This opinion

rendered at the ciose of the trial contains my findings of

fact and conclusions of law, whether specifically so de-

nominated or not. FED. R. CIV. P.—52(a).

The background of this case starts with the story of

Mr. J. M. Lapeyre, Sr. Mr. Lapeyre is an architect by

education. He is a designer of machinery and equipment

—e-

lla

by trade and experience. He is also as close as you can

get to being a professional inventor in terms of having

had hundreds of patents issued to him, ranging from the

first commercially successful shrimp peeling and deveining

devices to devices that are designed to capture and store

the mechanical energy of ocean waves and turn them into

electrical energy. Even the defendant’s patent counsel, Mr.

Brinkman, has characterized Mr. Lapeyre in correspond-

ence as a “prolific patentee,’ and the evidence bears that

out. One of the principal inventions of Mr. Lapeyre is, as

mentioned, the commercial shrimp peeling machine which

is manufactured by The Laitram Corporation under pat-

ents issued to Lapeyre and others. The shrimp peelers are

installed in seafood processing and canning plants all over

the United States and other parts of the world. One of

the operating problems of the shrimp peeling machines is

that they must handle a difficult product, that is, one that

is laden down with seawater, ice, and also, as anybody

who has handled shrimp knows, they tend to be rather

slimy. I don’t mean that in a derogatory fashion, but they

do exude certain kinds of oils and fats that make them

difficult to handle. Additionally, they range in size from

tiny to huge, and this makes the design and operation of

the machine somewhat difficult.

One of the difficulties in operation that Mr. Lapeyre

had observed over a period of time was that the conveyor

belts that carried the shrimp from the water-filled loading

port to the part of the machine where they are actually

peeled, sometimes passing through a cooking chamber, had

typically been made of a wire mesh or some other metal

construction. Whether this wire mesh was galvanized or

not, there were certain problems that were experienced

with it, namely, corrosion from sea water and from fatty

acids from the shrimp, and other incidents of hard use

that you would associate with a seafood processing plant.

This necessitated frequent replacement and maintenance

on the belts in certain installations. Additionally, there was

12a

a problem sometimes with the very small shrimp falling

through the mesh of the wire belts, and this also came to

Mr. Lapeyre’s attention. Having perceived this problem,

Mr. Lapeyre decided that there ought to be a better way

to do things when it came to manufacturing a belt, es-

pecially handling these small shrimp. Because the only

available corrosion-free alternative to ordinary metal was

stainless steel, which is prohibitively expensive, Mr. La-

peyre thought that the corrosion resistance of plastic of-

fered a solution to the problem he perceived. Therefore,

over a period of time, in the late 1960’s and into the early

part of 1970, together with his uncle, Mr. Fernand La-

peyre, also a principal in The Laitram Company, Mr. La-

peyre conceived the idea for what eventually was embodied

in the ’141 patent, that is, a plastic conveyor belt of mod-

ular construction using an integrally formed plastic module

with a plurality of link-ends on either side, joined by a

connecting means that could be assembled together into

a conveyor belt. I am here paraphrasing the claims of

patent ’141 for purposes of general description, at this

junction of the opinion. The device that Mr. Lapeyre in-

vented eventually became embodied, as I have said, in

patent '141, and it was commercially introduced by a sub-

sidiary of Laitram called The Intralox Company (Intralox),

the name deriving frem the interlocking method of joining

the modules to form the belt. Intralox has ever since mar-

keted the belt and driving mechanisms and various var-

iants of the belt that had also been invented and patented

by Mr.Lapeyre, and here I am referring to the raised rib

version, which is embodied in ’949 and the flexible variant,

that is referred to as the Kewley-Demarest variant (that

Mr. Lapeyre himself did not invent, but that was invented

by several mechanics of Laitram or Intralox) later em-

bodied in patent ’763. These, as I have said, were mar-

keted by Intralox, and the evidence satisfies me by a

preponderance that they did achieve commercial success.

That is, there was a market for plastic belting that had

quer

13a

theretofore been effectively untapped. Even though there

had been so-called table-top belting manufactured, I be-

heve, by Rexnord and perhaps some belting of foreign

manufacture, also plastic, on the market, there was noth-

ing on the market in the 1970’s that did what Intralox

belting did as well as it did when it was introduced com-

mercially.

The commercial success of Intralox (even though that

commercial success might not have been reflected imme-

diately by profitability of the company as a whole), nonthe-

less came to the attention of Cambridge, which has been

in business in Cambridge, Maryland for approximately 50

years, manufacturing flat wire and woven wire belts. In

fact, Cambridge had been a supplier of Laitram in its

(meaning Laitram’s) manufacture of original equipment for

the shrimp-peeling industry. Whether the impetus came

from viewing the Intralox product or another kind of plas-

tic belt, Cambridge decided that they ought to get into

the plastic belt business and that there was in fact a mar-

ket there that they could tap. This is embodied in a mem-

orandum that was introduced as Pl.’s Ex. 97, identifying

a market for plastic belting and setting forth a marketing

strategy for Cambridge to develop a product to come into

this market. In that memvrandum, Intralox was discussed,

and among other things, it was noted that Intralox was

the major market force at the time in the plastic belting

industry. Eventually, and within a relatively short period

of time after Cambridge had made the decision to look

into marketing plastic belting, there was an attempt to

form a joint venture between Intralox/Laitram and Cam-

bridge, in which Cambridge was basically to acquire the

Intralox business, by paying in exchange therefor a certain

amount of cash and also paying a royalty to the patentees

in a certain amount. I believe that the price that was being

discussed ranged from between a million or so to a million

and a half, and the royalty between 7 and 10 per cent. I

say that the prices and royalties ‘‘ranged,’’ because there

l4a

never was a conclusion to the negotiations between Lai-

tram and Cambridge that culminated in any kind of joint

venture or other agreement. That is, each party simply

went its own way, apparently because the asking price by

Laitram was too high for Cambridge under Cambridge’s :

then-existing evaluation of the worth of the product and

business. See P].’s Ex. 11 and other related documents for

the course of negotiations between Cambridge and Lai-

tram.

When the negotiations eventually proved fruitless, Cam- :

bridge decided (if I can have some poetic license), ‘If you

can’t join ’em, beat ’em.” In other words, it was decided

that Cambridge would manufacture and market its own

modular plastic belting. Cambridge did not then have the

in-house expertise with plastics (despite having a large

staff of engineers, both degreed and practically trained)

to design or develop concepts, tooling or drawings, or take

other preparatory steps toward the manufacture of mod-

ular plastic belting. Therefore, Cambridge hired the in-

dependent and well-known engineering and consulting firm

of Arthur D. Little, Inc. of Cambridge, Massachusetts, to

develop a modular plastic belt that Cambridge could bring

on the market. There is no question in my mind that

Cambridge had it in mind that the Intralox products were

successful commercial products, at the time Cambridge

went to Arthur D. Little (ADL). In fact, evidentiary of

that is Pl.’s Ex. 15, the letter from Mr. Pink to Mr.

Brinkman, stating that the goal in going to ADL was to

come up with a product that combined the best features

of the Intralox products, specifically (in fact the letter

gives the numbers of patents) those embodied in patents

141, ’949 and ’763. In fact, an excerpt from this letter

dated June 6, 1980 reads: ‘“‘We are primarily interested

in features similar to Laitram patents [’141, 949, and

’763]. We would hope to incorporate the best of all of

these in a single design. As you know however, this may

not be possible.’’ There is some question which I will dis-

nities

seas openers >

15a

cuss later on as to whether the concluding part of that

quotation, 2z.e. that it ‘‘may not be possible’ relates to

possibility in the legal sense taking into account patent

infringement, or possibility in the technical sense of put-

ting together the features of the ’141, ’949, and ’763 pat-

ents into a single product.

At any rate, ADL proceeded to work on designing the

product desired by Cambridge. In the course of this, many

designs were tried out and discarded as you can see for

example, the minutes of the meeting of January, 1981

showing a great number of tentative designs. (Pl.’s Ex.

103). Between early 1981 and the summer of 1982, ADL

came up with a design that eventually was set up into

soft tooling and then debugged, and the plastic modular

belt was announced in August of 1982, at least in-house

at Cambridge, as being finalized in design and about ready

to come on the market. See Pl.’s Ex. 21, which is the in-

house announcement of the finalization of the design of

the ADL product. This eventually came to be known as

the Cam-Clean modular belt, and it is the accused product

in this case. The Cam-Clean product was marketed in early

1983. There is some question as to just when it came on

the market, but it was definitely on the market as early

as February of 1983.

Both the plaintiff’s belts and the Cam-Clean belts have

been commercially successful. Intralox is a much smaller

corporation in terms of sales force than is Cambridge, and

also in terms of general marketing skill and entrenchment

in the market. In fact, the relative marketing strengths

of Intralox and Cambridge were what really motivated the

aborted attempt at a joint venture. In any event, Cam-

bridge has aggressively marketed the Cam-Clean belt and

they have been successful in selling that belt not only

generally but also to OEM’s, distributors, and direct cus-

tomers who previously were supply by Intralox, and they

have bid head-on-head with Intralox for a number of jobs

which Intralox eventually lost to Cambridge. Now it may

l6a

be that the Cambridge belt with the camming action that

it has in the triangular formation of the holes in the link

ends is in some ways superior to the Laitram/Intralox

model, and in particular, in its ability to have the pivot

rod cleaned by a stream of water or steam under pressure.

Nonetheless, it is well settled in patent law that the ques-

tion of infringement is to be determined on the basis of

whether the device infringes the patent literally or by the

doctrine of equivalents, regardless of whether the accused

device also embodies some improvement over what has

been patented by the plaintiff. So long as it embodies what

is patented, the addition of more features or the making

of a better product in terms of result and functional per-

formance is not relevant to the question of infringement.

As I have indicated, both the Intralox product and the

Cam-Clean product have achieved wide acceptance, partic-

ularly the raised-rib version of the Intralox, that is, the

949 patent, which competes directly with Cam-Clean in

the market for plastic modular belts that can transfer un-

wieldy and fragile items, such as bottles and cans and

jars, from the belt to a transfer comb without tippage. I

do find as a fact that there was a felt need in the market

place for a belt that could transfer unwieldy and fragile

items at either slow or high speed without tippage, and

that both the Cam-Clean and the Intralox raised-rib are

capable of fulfilling that need. The major commercial ap-

plications of both belts are in the food processing industry,

where the gravity loads on the belts are not high, but

where there is a need for a stable transfer platform and

a smooth planar surface for engagement with the transfer

means. For example, bottling plants and other plants where

food is put into packages that have to be handled, accu-

mulated, palletized, or otherwise dealt with along a moving

line, are typical applications of both the plaintiff’s products

and the Cam-Clean. I should also state that both the '763

Kewley-Demarest Intralox product and the Cam-Clean are

USDA approved for use in the sanitary areas of food proc-

|

|

17a

essing plants where biological contamination by blood and

body fluids in recesses and crevices of the belts is a matter

of health and safety concern by the United States De-

partment of Agriculture. Therefore, there is direct com-

petition of the products in that significant market as well.

At trial the witnesses who testified and whose testimony

was of primary interest to the Court included a number

of experts. In particular, the expert witness for the plaintiff

was Mr. J. M. Lapeyre, Sr., who, as I have indicated, is

a prolific patentee and an experienced designer of ma-

chinery and mechanical devices in general. He is a grad-

uate in architecture, having, like the Court, been unable

to fathom the intricacies of the calculus well enough to

be an engineer. Nonetheless, he is an experienced designer

of machinery, despite his lack of a formal degree in me-

chanical engineering. The experts who testified for the

defendant included Commissioner C. Marshall Dann, who

was Commissioner of Patents in the Carter Administra-

tion. Mr. Dann is a patent lawyer of broad education and

experience and he was certainly a well-qualified expert

witness in the field of patent law. The technical experts

who testified for the defendant were two in number, both

of whom are or were associated with Cambridge. Mr. An-

drews is a graduate engineer who was Cambridge’s chief

of design and engineering from the 1950’s until 1970, when

he went off on his own to a consulting business dealing

primarily with wetlands preservation and reclamation. Mr.

Andrews was recognized by the court as an expert engi-

neer in terms of education, training, and experience. The

other technical expert who testified was Mr. Peter Bailey,

who is currently vice president of engineering for Cam-

bridge. Mr. Bailey is not a degreed engineer. He did have

some courses in the engineering curriculum at Johns Hop-

kins, but he never completed a degree in engineering.

After an extended college career, he eventually graduated

from Johns Hopkins, but with a degree in business and

industrial management, that is, a bachelor’s degree in lib-

18a

eral arts, with a concentration in business and industrial

management. However, the court recognized Mr. Bailey

as an expert in the field of engineering by virtue of his

experience in a hands-on and in a management capacity

with Cambridge. See FED. R. EVID. 702. In accordance

with the rule in Graham v. John Deere, 383 U.S. 1 (1966),

I must determine in this case what the level of ordinary

skill in the art was, and I find that the level of ordinary

skill in the art was that of an experienced mechanical

designer, such as Mr. Lapeyre, whether or not that person

had a formal degree in mechanical engineering. This is as

of all the times relevant to this lawsuit.

Now, turning to the substantive issues in suit, I will

state first the legal principles that govern. Under the pat-

ent code (85 U.S.C. § 282), a patent granted by the Com-

missioner of Patents has a statutory presumption of

validity. He who would challenge the validity of the patent

must come forward and satisfy a burden of proving it

invalid by clear and convincing evidence. There is some

question as to, when you get into the realm of obviousness

and anticipation, the weight to be accorded to prior art

patents that were before the Patent Office, which are gen-

erally entitled to less weight as opposed to those that are

relevant, but nonetheless were not before the Patent Of-

fice, which are generally entitled to more weight. But that

is a matter, in my judgment, of weight of the evidence.

It does not alter the statutory presumption, nor does it

alter the rule that the presumption must be overcome (if

at all) by clear and convincing evidence. As a further mat-

ter of law with regard to validity, the basic notion of

proving a patent invalid generally rests on the proposition

that the Patent Office made a mistake when it was issued.

That is, that the invention does not have the requisite

degree of novelty or is obvious or was anticipated by an-

other patent that has already been in the public domain,

or was anticipated or rendered obvious by a prior publi-

cation or prior use of the invention in the public domain;

Cs eligi, ybToe

De ante CALI B D eH b

19a

in other words, it was disclosed. The patent laws protect

inventiveness, and inventiveness does not come about when

one simply practices the ordinary skills that one has ac-

quired in a particular trade or art. Rather, there has to

be some advance in the trade or art that is not obvious

or anticipated by what has gone before it. With regard to

the notion of anticipation, my conclusion of law with re-

gard to anticipation is that in order to be anticipatory, a

cited piece of prior art must show all the elements of the

patent in suit (or the claim in suit at least) in the same

situation and united in the same way to perform an iden-

tical function. See, eg., W. L. Gore v. Garlock, 721 F.2d

1540, 1554 (Fed. Cir. 1988) and a number of other cases

on the issue of anticipation. I would also cite 35 U.S.C.

§ 102(b), as the statutory reference, and for additional case

law support, e.g., Schroeder v. Owens-Corning Fiberglass,

514 F.2d 901, 903-04 (9th Cir. 1975).

With regard to obviousness, an invention is not patent-

able if, considering the scope and content of the prior art,

the differences between the prior art and the patent in

suit, and the level of ordinary skill in the art, it would

have been obvious to one ordinarily skilled in the art. That

is stated in Graham v. John Deere (which is the Marbury

v. Madison of obviousness), 3838 U.S. at 1. Additionally,

Graham v. John Deere teaches that there are other con-

cerns which used to be called secondary concerns, but

which under recent case law are no longer secondary, but

are to be considered by the court in every case, that in-

dicate that a particular invention was not obvious from

the prior art. These concerns include a felt need in the

industry and the commercial success of the patented prod-

uct. As I said, these are matters to be considered in every

case in which obviousness is claimed. I also would state

that recent case law indicates that the Court of Appeals

for the Federal Circuit is applying a test for obviousness

that does not merely call into account hindsight. The ques-

tion is whether the prior art, considering its scope and

etnias

20a

content and the level of ordinary skill, must itself suggest

the combination of separate elements into the claimed in-

vention in suit, not just whether it illustrates separate

elements. You can see, for example, Fromson v. Advance

Offset Plate, Inc., No. 84-1542 (Fed. Cir. Feb. 21, 1985),

slip op. at 15. To illustrate this notion, you cannot claim

that the existence of a unicorn should be obvious from

taking a trip to the zoo and seeking a horse and a white

rhinoceros in adjacent cages. It takes a spark of inven-

tiveness to look at a horse and then look at a white rhi-

noceros and then conceive the idea of a white horse with

a horn. There is a claim asserted in this case, only with

regard to patent '141, that it is invalid in its entirety

because of inequitable conduct (failure to cite prior art)

practiced on the Patent Office by Mr. Schiller, the attorney

who obtained the patent for Mr. Lapeyre. It requires under

the case law clear and convincing evidence of inequitable

conduct before the court can invalidate the patent on that

ground. Inequitable conduct is a cousin-german to fraud,

but it does not require the same kind of quantum of proof

of malevolent intent or conduct as fraud. Nonetheless, it

still requires, as I have said, clear and convincing evidence

in order to sustain it as a defense. There is a sliding scale

of materiality of the omitted prior art and intent to deceive

that the Court must take into account when it decides

whether the omission of a particular piece of prior art

amounted to inequitable conduct. See, e.g., J. P. Stevens

v. Lex-Tex, 747 F.2d 1553 (Fed. Cir. 1984). There is some

question as to whether gross negligence of a patentee or

his attorney in failing to submit prior art to the Patent

Office can amount to inequitable conduct. However, look-

ing over the authorities, in particular, the Gemveto case

that was cited by defense counsel as practically on point

with this one (Gemveto Jewelry Co., Inc. v. Lambert Bros.,

Inc. 542 F. Supp. 933, 943-44 (S.D. N.Y. 1982)), one finds

that there certainly can be inferential proof or circum-

stantial proof of the existence of the fraudulent intent

en ee ee

Z2la

required under the inequitable conduct doctrine. But, the

Gemveto court does not go so far as to say that gross

negligence can supply the requisite intent. The Court says

that where the prior art’s relevance is so clear as'to be

unquestionable, the Court can and must infer the existence

of fraudulent intent or, at the very least, gross and reck-

less misconduct. 542 F. Supp. at 944. Therefore, even

though gross negligence must be shown, and at all times

the burden is on the defendant to show an intent to de-

ceive. As is generally the case, an intent to deceive is

difficult to prove by direct evidence; it must usually be

proved circumstantially. Nonetheless, the burden is on the

defendant.

Other conclusions of law that are relevant to the case

are as follows. Literal infringement means that the accused

device reads word for word against the claims of the in-

vention. See, e.g., Graver Tank & Mfg. Co. v. Linde Air

Prods. Co., 339 U.S. 605 (1950). If the accused device

literally infringes the patent, then the question of infringe-

ment is settled without any need to go into the question

of equivalents. If there is no literal infringement, how-

ever,the inquiry is not at an end. The Court must then

determine whether the accused device infringes under the

doctrine of equivalents and that requires the Court to de-

cide whether the accused device performs substantially the

same function in substantially the same manner by sub-

stantially the same means to achieve substantially the same

result as the patented device. In determining the range

of equivalents, the Court can and must take into account

the notion of file wrapper estoppel. File wrapper estoppel,

or as it is also called, prosecution estoppel, means that

one must construe the claim (and the patent as a whole)

in light of statements that were made by the patentee

during the course of obtaining the patent in order to con-

vince the examiner to allow the patent. Frequently, the

patent is not granted as prayed on the initial application,

but it has to go through a distillation process during which

22a

certain claims are rejected, usually in light of prior art.

In order to convince the examiner to issue the patent, the

applicant or his attorney must distinguish the prior art.

In the course of distinguishing the prior art, statements

may be made or arguments may be raised that narrow

the scope of the grant in order to achieve distinction over

prior art. This raises an estoppel against the patentee if

the patentee later claims a broad range of equivalents.

The effect of the estoppel is to preclude the patentee from

claiming that a product infringes under a broad reading

of the claim that he narrowed or abandoned during the

prosecution of the patent in order to obtain it. It really

is not a complicated doctrine; it is no more than a variant

of the common law notion of estoppel, that is, the equitable

principle that you cannot come into court asserting a po-

sition that by your conduct or words at another time you

have abandoned. That is the essence of estoppel, whether

it be in a patent case or any other case. However, not

everything that occurs and not every word that is said

during a prosecution of a patent raises an estoppel. The

fundamental purpose of file wrapper estoppel is to prevent

the patentee from attempting to resurrect subject matter

that was surrendered during the prosecution of the patent.

Hughes Aircraft v. United States, 717 F.2d 1351, 1362-63

(Fed. Cir. 1983). Like all equitable doctrines, the doctrine

of file wrapper estoppel ought to be applied with a strong

measure of common sense. Those are my conclusions of

law.

Moving on to the question of individual patents, I read

the other day that there is no such thing as a judgment

saying that a patent is valid, only a judgment saying that

it is not invalid. I think Judge Markey said that in one

of the opinions I looked at the other day. In any event,

for the purposes of a particular suit, it is, on the evidence

presented to the court, either valid or invalid, so, there-

fore, the first question is the validity of patent ’141. As

I have already said, the patent is entitled to the statutory

a. i + ee bl

23a

presumption of validity, and the defendant must prove its

invalidity by clear and convincing evidence. The defendant

claims that the patent was anticipated by King, U.S. Pat-

ent 1,936,764. I find that King does not anticipate the

invention in suit in ’141, because King is clearly not of a

modular construction. The only way you can make modules

out of King is to take a strained view of the illustration,

and the language of King clearly class, in my judgment,

for the assembly of a series of individual links joined, by

welding or peening, onto a longitudinal rod that runs

transverse of the direction of travel of the conveyor belt.

The basic teaching of King involves the use of individual

links that are individually assembled onto one long lon-

gitudinal member and the members are then joined with

pivot rods to form a belt. King does not involve modular

construction at all. The fact that by modern techniques

you can speed up the putting together of a belt like that

shown in King (rather than using hand assembly which

you probably would have had to do at the time of King)

is, in my judgment, utterly immaterial to the question of

anticipation. Therefore, because anticipation requires that

all the elements of the patent must be shown in the same

situation, united in the same way, performing the identical

function, I find that King does not anticipate '141, or any

of the claims in suit under ’141.

With regard to obviousness of ’141, I have already made

findings on the level of skill: as to the commercial success

of ‘141, it was immediately successful and has enjoyed

commercial success to the extent that it certainly had some

effect on Cambridge’s decision to enter the plastic belt

market, and it also was attractive enough to Cambridge

so as to bring about an attempted joint venture, even

though the joint venture did not prove permanent. There

was a need for it, certainly, in the handling of corrosive

materials and corrosive foodstuffs like the very shrimp that

Mr. Lapeyre’s machines peeled. There was also a need for

it in other food handling areas where cleanliness and light

24a

weight are important. With regard to the scope and con-

tent of the prior art, in addition to King, I do find that

the prior art patents cited against ’141 in the Patent Of-

fice, that is, in item 56 of patent 3,870,141 are all relevant

prior art. In addition to what is cited in the patent, there

is also the King patent. There is the Malard patent, which

is a German patent. Those two are also prior art in this

general realm. I do not find that the defendant has shown

by clear and convincing evidence that this prior art, alone

or in combination, itself suggested to one ordinarily skilled

in the art the combination of elements that eventually

resulted in ’141. None of those patents, in my judgment,

showed a maximization of the shear forces on the pivot

rod holding the whole structure together, together with

(either alone or in combination with other patents) a teach-

ing of bricklaying belt construction, using like modules. It

is true that in Malard, one of the illustrations called for

or showed what looks like a randomly assembled group of

what I find as a fact to be dissimilar links, but the practice

of bricklaying, that is, a tying together of the structures

by placing them in adjacent positions intermediate one

another, was not taught in the language of the patent. It

only could arise from the illustration of figure 9, and, even

taking into account that figure, there is no clear and con-

sistent pattern of bricklaying of like modules that emerges

from Malard. With regard to the Wright patent, which is

British patent No. 199,151, the device that is disclosed

there is very much like a table top kind of device that

shows a module having distinctly male and female ends.

It does not show like modules that can be assembled to-

gether into a belt of any varying width. It simply shows

plates with male and female ends that can be joined to-

gether with a pivot rod, and if you put that together with

Malard you still don’t get the idea of like modules linked

together in an interlaced, bricklayed fashion as a teaching

of the patents, nor is it obvious from looking at Malard’s

crazy-quilt arrangement of dissimilar modules that one

.

:

25a

could in fact come up with the idea of an easily-assembled

modular belt that any idiot can put together simply by

opening up a box full of modules and slipping them to-

gether and putting a rod through them. The ease of as-

sembly inherent in the ’141 device is something that is

not obvious from looking at Wright or Malard, nor is it

obvious from looking at the prior art of U.S. patents cited

against it in the Patent Office as listed in item 56 of patent

141. So, the scope and content of the prior art I have

stated, the differences between the prior art and the pat-

ent I have stated, the level of skill I have ascertained,

and, therefore, I find that the patent is not invalid for

obviousness. I further find that the patent is not invali-

dated by irregular conduct. The testimony of Mr. Schiller,

in which he strongly disavowed any intent to deceive the

Patent Office by not sending Malard to them during the

prosecution of ’141, and the fact that Malard, which sur-

faced during the prosecution of foreign counterparts, was

rejected as significant prior art by the foreign patent of-

fices, and the fact that Mr. Schiller’s testimony was, to

me, candid and credible, shows that there was no intent

to deceive the Patent Office. As he stated, he is in the

business of getting patents that will survive an attack, and

you don’t do that by concealing prior art. You do that by

giving the examiner as much art as he can possibly have.

Not only do I find no evidence of conscious intent to

deceive, I do not find any evidence of gross or wanton

neglect or misconduct. I find that Mr. Schiller made a

judgment as to relevance and materiality of the patent.

The judgment might not have been the best one to have

made in hindsight, but it falls short of the quasi-fraudulent

standard that is recognized as constituting inequitable con-

duct. The fact that the foreign counterpart ’141 applica-

tions might have claimed end-to-end reversibility, whereas

that claim was not put into what eventually came out to

be claim 19, while it may be some circumstantial evidence,

is not a persuasive fact in my judgment, having had an

26a

opportunity to hear credible testimony viva voce from Mr.

Schiller. For those reasons, I find that patent ’141 has not

been proved invalid.

With regard to infringement of ’141, I find that patent

'141 is not literally infringed for reasons that I have stated

previously in connection with the motion for partial sum-

mary judgment in this case, that is, as to claim 1, and as

to dependent claims 2, 10, and 11. The reason I find that

there is no literal infringement is because the Cam-Clean

product (and the physical embodiment of it is what one

has to look at to determine literal infringement) is not in

fact end-to-end reversible. If one assembles a belt made

up of these, on the bottom side of the belt, where the

female receptacle for driving means is, one would not find

a row of similar cavities to receive the sprocket tooth.

Rather, one would find some narrow and some wide cav-

ities, and the Cam-Clean is designed to be driven with a

sprocket that has teeth that fit into the large or wide

cavities, therefore calling for the Cam-Clean belt to be

assembled so that these wide cavities line up in the di-

rection of travel.

This does not end the inquiry, though. The inquiry must

go on as to whether there is infringement by the doctrine

of equivalents. With regard to the question of equivalents,

in claim 1, first 1 would find that the accused device clearly

reads on paragraph i of claim 1 and paragraph 2 of claim

1; there is no dispute as to reading on paragraphs 1 and

2 of claim 1, and the defendant would admit that the

device literally reads on paragraphs 1 and 2 of claim 1.

The question on equivalents is whether as to paragraphs

3 and 4 of claim 1, the accused device performs substan-

tially the same function by substantially the same means

in substantially the same way, or words to that effect,

that is, one of substantial equivalents, essentially. The first

question is with regard to end-to-end reversibility. As I

have indicated, if you assemble the Cam-Clean belt in a

random fashion with regard to each module as it fits with

27a

each other, it would not be adapted any more to being

driven with the Cambridge sprocket drive. However, it is

still, I find as a fact, reasonably capable of being driven

by a friction means, and I also find that the ’141 patent

does not call for any particular driving means. Thus so

long as the belt is reasonably capable of being employed

commercially in an end-to-end reversible fashion, it comes

within the acceptable range of equivalents of the Intralox

141 patent. The '141 belt itself is being used with a fric-

tion drive by at least one customer, Green Giant. Here in

court there was a model of a Cambridge belt that was

driveable by friction, and I do find as a fact that friction

drive is a reasonable means of driving a belt in some

applications that customers may have. The fact that such

an application exists is attested to by Pl.’s Ex. 47, which

shows a Green Giant plant using an Intralox belt with a

friction drive, and there is no reason that i can see from

the evidence why the Cam-Clean belt could not be used

similarly driven. Furthermore, the Cam-Clean belt could

be so used when it is randomly assembled. With regard

to a smaller-toothed sprocket, Cam-Clean doesn’t neces-

sarily have to be driven with a sprocket of Cambridge’s

manufacture. It could be driven with a sprocket that the

customer can make himself or buy commercially on the

market; even though that product might not be readily

available, other commercial products are available to do

it. For example, if somebody had a Laitram belt that was

being driven with Laitram sprocket wheels and desired to

replace it with a Cam-Clean, one could, as Mr. Lapeyre

did in demonstration, readily and simply alter the Laitram

sprocket drive to drive the Cam-Clean belt, even if the

Cam-Clean belt is put together in a random way. There-

fore, I do find infringement by equivalents as to paragraph

4 dealing with end-to-end reversibility. There is nothing in

28a

the file wrapper that estops the plaintiff from contending

that the claim should be construed in this fashion.

Now, with regard to paragraph 3 of claim 1, and I am

also here, of course, including evaluation of dependent

claims 2, 10, and 11, the question of equivalents involves

paragraph 3, which requires a plurality of spaced apart

elongated members, each integrally formed with and join-

ing a pair of corresponding link ends of the first and

second pluralities. With regard to that, I would find that

although the patent illustrates the elongated members (in

its figures) as not themselves having any pronounced cur-

vatures, or zigs or zags, I find that there is nothing in-

herent in the word “‘elongated’’ that requires it to be read

as elongated and straight. I do not see anything in the

file wrapper that precludes construing elongated as in-

cluding a zig or zag in the elongated member, and by the

doctrine of equivalents, the Cam-Clean, even though its

link ends are not joined by a straight elongated member,

nonetheless has link ends joined by integrally formed elon-

gated members that have generally an ‘“L” shape or a

semi-‘‘H’”’ shape. in fact, if one looks at figure 7 of the

141 patent, one sees that the elongated members that join

the corresponding link ends in the Lapeyre ’141 are not

invariably straight. In fact, you couldn’t get the link ends

as illustrated in figure 7 of ’141 parallel with each other

unless there was in fact a degree of deflection or curvature

in the elongated member, right where it joins up against

each link end. So, therefore, I find that a curvature or a

bend in the elongated member so long as the elongated

member is formed as an integral part of the module, falls

within the range of equivalents to ’141, that is, that it

performs substantially the same function, by substantially

the same means, in a substantially similar way.

The other question is paragraph 4 of claim 1, which

requires that the link ends must be dimensioned and spaced

apart by a distance slightly greater than the width of a

link end, so that the module is end-to-end reversible, so

29a

that plurality of said modules may be engaged with each

other at said link ends. Now, when you come to that

particular claim, there are two so thats. It would seem

that so long as the module is end-to-end reversible in prac-

tice, you would satisfy the claim as long as there is space

enough to insert the link ends of one module into an in-

terlocking relationship with the link ends of another. How-

ever, because of file wrapper estoppel, I can’t read the

claim that broadly. By file wrapper estoppel, I’ve got to

read that claim and also the similar claim in claim 19 as

calling for a device that maximizes the shear loads on the

rod and minimizes the bending loads on the rod. This was

something that was clearly raised during the prosecution

of the patent to distinguish it from other art. I do find

as a fact that when you measure the space between the

link ends of the Cam-Clean, they are in fact spaced apart

by a distance slightly greater than their width at their

widest part. In measuring width of interlocking pieces, you

obviously have to measure the width of interlocking pieces

at the widest part. If they were not spaced apart by some

distance greater than their width, they wouldn’t fit to-

gether and interlock. There obviously has to be some space,

and the only question is whether it is slightly greater than

the width of the link end or not in the accused product.

Here the testimony is somewhat equivocal; it’s not all of

one species. Mr. Lapeyre says that the spacing is slightly

greater than the width; the other testimony, especially

from Mr. Bailey, is that it is not. The numbers that you

get vary when you measure as against the shaded-in pho-

tograph that Mr. Lapeyre used and the mechanical draw-

ing by ADL on the one hand, and when you measure it

as Mr. Lapeyre and Mr. Bailey both did as against the

actual product, on the other hand. I think it’s the actual

product that one has to look to in making this determi-

nation, in accordance with the conclusions of law I have

already stated. Nonetheless, the question here is really one

of practicality, that is, is the spacing slighly greater in

30a

practice, and here I find that the spacing is slightly greater

in practice, especially when construed in light of the phys-

ical function of the link ends. When forces are applied to

the belt in the direction of travel, the forces are trans-

mitted to the rod at the places where the link ends bear

against the rod. These forces have both bending and shear-

ing aspects vis-a-vis the rod. Mr. Lapeyre’s patent teaches

that you keep the space that exposes the rod to bending

forces to a minimum because of the common sense prin-

ciple that the closer the forces across a member are to

being in pure shear, the less likely the member is to de-

form. If it does anything at all, it will just break and not

bend and deform. In belts, you want to keep a certain

pitch under tension, so you are interested in not having

bending of the pivot rods. If, you are interested in having

them do anything, it is just to break outright under and

excessive load. Mr. Lapeyre, during the prosecution of his

claim, clearly taught that it is desirable to minimize bend-

ing and maximize shear. However, he did not teach and

the rod has to be in pure shear, and in fact in the em-

bodiment of the invention shown in figure 8 (there is also

an explanation in the text of the specification), there is

more susceptibility to bending than in other embodiments

of the invention. The point is to minimize the bending

forces.

Now, in the accused device, it is true that the planar

or surfaces of the link ends do not fit snug up against

one another. It’s also true, as demonstrated by the ocular

proof (to borrow from Othello) at Df.’s Ex. 151, that the

rod can be made to bend under certain experimental con-

ditions. However, the experimental results there do not

detract from my finding that the plaintiff has proved by

a preponderance of the evidence that there is infringement

by equivalents. The reason that, in my judgment, the result

of the experiment as embodied in the photographs does

not detract from the proof of infringement by equivalents

is that, in the test, the belt was subjected to forces way

hs a td on" ple il

la

beyond the normal range of forces that would be applied

in a working situation. There is nothing in Mr. Lapeyre’s

patent, even when considering file wrapper estoppel, that

claims that the rod is immune to bending in his invention

under extraordinary conditions. Furthermore, the rod in

the experiment was not capped as it would have been in '

real life. Thus, it could have stretched, facilitating bending.

It stands to reason that something is more likely to shear

when its bending is inhibited by the prevention of stretch-

ing. The more it’s apt to stretch, the more it’s apt to

bend, rather than shear. If the experiment had been con-

ducted on an assembled set of modules where the rod was

not free to bend and stretch, then it could have illustrated

that the shear overcame the bending, and the rod would

have sheared when the extraordinary force was applied to

it. In any event, looking at Pl.’s Ex. 46, which I find to

be a reasonably accurate diagram of what’s happening with

the spacing of the link ends at their widest points, if you

draw lines tangent to the widest points of adjacent link

ends in the assembled Cam-Clean product, that is, tangent

to the widest points and parallel to the direction of travel,

you see that those lines come very, very close together,

which means that the shear forces that would be applied

to the pivot rods in the assembled Cam-Clean are very,

very close to each other in terms of a plane. They almost

are precisely in planar alignment with each other. There

is some difference between °141 and Cam-Clean in the

thousandths of an inch range, but nonetheless it still trans-

lates into more shear than bending in the Cam-Clean, and

by far more shear than bending, even though the Cam-

Clean is not immune to rod bending under the test con-

ditions. Under these circumstances, | find infringement by

equivalents of claim 1.

With regard to claim 19, there is no claim of literal

infringement. The claim of equivalents is resisted on sev-

eral grounds. One is the question of substantially in contact

in paragraph 2 of claim 19, and whether the link ends of

32a

each module are substantially in contact with link ends of

an adjacent module. Here, with regard to that, I would

find that there is infringement by equivalents because there

is no requirement in the patent that the link ends of each

and every module must be in substantial contact with each

and every link end of the adjacent module. The substan-

tiality of contact is achieved in substantially the same way

and produces substantially the same result, that is, a non-

sloppy belt in terms of flexion transverse to the direction

of travel, accomplished by the use of spacers (or nibs or

little dogs or some other means of maintaining some min-

imal contact between link ends). Clearly, in Cam-Clean as

assembled, there is physical contact between link ends that

satisfies me under the doctrine of equivalents as being

substantial contact, at least enough substantial contact so

as to prevent relative motion by the engagement of en-

gaged link ends. As I say, there is no requirement that

I see in claim 19 that every link end has to be engaged

with every other link end. This is simply a matter of design

choice, and so long as shear prevails over bending in the

assembled product and the assembled product is put to-

gether in a bricklayed fashion, there is infringement by

equivalents.

The major question that’s raised in this regard is one

of file wrapper estoppel, that is, whether the statement

in R.117 of the prosecution history of '141 distinguishing

this patent from Stanius raises an estoppel that precludes

the plaintiff from claiming equivalents where not every

single link end is substantially in contact with every other

single link end. However, applying the doctrine of file

wrapper estoppel, it is clear to me that the statement that

was made at R.117 was made to distinguish this device

from Stanius, where there is no interlocking at all with

regard to two of the belt leaves; they simply come together

and butt up against each other laterally in Stanius, without

any interlocking of adjacent modules. I do not think it

would be equitable or appropriate to read that one state-

33a

ment in R.117 that was made to distinguish this claim

from Stanius so as to preclude the plaintiff from claiming

infringement by equivalents where, for example, every

other link end was in substantial contact, or, that same

effect is obtained, as here with Cam-Clean, by the use of

projections on certain link ends that maintain substantial-

ity of contact with other link ends. The point is, there has

to be substantial contact in some link ends (within man-

ufacturing tolerances) so as to prevent lateral slop in the

belt. And that is the result achieved under claim 19 of

Lapeyre '141, and it is also the result achieved by the

manufacturing means chosen in the accused product. That

is my finding on equivalents as to ’141, claim 1 and claims

dependent thereon. As to claim 19 of ’141, paragraph 1

reads right on the accused device. Paragraph 2 on the

substantially in contact with, I have already discussed un-

der the doctrine of equivalents. Paragraph 3 of claim 19

reads right on the accused device, and, as to paragraph

4 of claim 19, there is infringement by equivalents because,

clearly, the engagement of engaged link ends prevents

relative lateral movement of the accused device’s modules,

just as paragraph 19 of claim °141 describes and since

there is infringement by equivalents of claim 19, claims

20 and 21 also would be so infringed.

Moving on to reissue patent ’841, validity is challenged

here. I find that ’341 (and that is the sprocket mechanism)

is not anticipated in any single reference. However, it is

hotly contested that it is obvious under prior art refer-

ences, particularly Claghorn, Comstock, and Cremona when

viewed together with the principal of mechanics that calls

for using a square shaft in certain gearing applications.

The essence of patent ’341 is the need to maintain a po-

sitive drive relationship between the sprocket and the belt

while taking into account the lateral expansion in the belt

caused by fluctuations in temperature when the belt is put

to applications where the product is conveyed from hot to

cold or cold to hot areas. This was a problem in practice

a acl

ne iii

34a

for Mr. Lapeyre which he satisfied by coming up with the

idea embodied in ’341, that is, fixing the central drive

sprocket and allowing the other two or more lateral drive

sprockets to float. Additionally, to avoid the problem of

loss of a key or shearing of a key (I take judicial notice

that keyed devices are frequently subject to having the

key sheared and thus losing the drive connection) he came

up with the idea of making the shaft on which the sprock-

ets are mounted square. I do find that it was a known

principle at the time this invention was made that a square

shaft could be substituted for a keyed round shaft. How-

ever, none of them showed a combination of one fixed and

several free floating sprockets, whether mounted on a

keyed round shaft or on a square shaft. There is prior art

and, here again, the scope of the prior art is, of course,

that cited by the Patent Office in item 56 of reissue 30,341

and in addition to that, the foreign Cremona patent and

other patents that have been cited during trial. In any

event, the prior art that is claimed to make this obvious

in light of the mechanical design practice of using square

shafts in gearing applications, that prior art is primarily

Claghorn and Comstock. Tie preferred teaching of Clagh-

orn, besides using end rollers to maintain belt alignment,

was to use sleeves to maintain positive spacing, and the

float that was envisioned in Claghorn was only minimal

and not any kind of float that was of the nature that one

would experience with the relatively expandable plastic me-

dium that is used in plastic belts, but, rather, smal] var-

iations due to the weave of metal belts that Claghorn was

intended to go with. Comstock really was, in my judgment,

although you can cal] it a conveying mechanism, directed

towards something entirely different. That is, the need for

tensioning an inked ribbon in a high speed printer, and,

again, it called for really a fixed distance to be maintained

between sprockets by means of tensioning off one against

the other with a spring, through the medium of the ribbon.

Really, it was a device that was intended to maintain a

35a

fixed distance rather than to allow floating as taught in

the ’341 reissue patent. In the Cremona patent, a German

patent, although there was some small degree of lateral

movement allowed in the sprockets T-1 and T-2, nonethe-

less, they had means for maintaining a fixed alignment,

that is, springs that were working in tension against each

other. Therefore, the notion of the free float of several

sprockets, while fixing one central sprocket to maintain

positive drive is not disclosed in any of the patents. So,

I find that the use of one fixed and severally completely

floating unrestrained sprockets was not obvious from the

prior art. Furthermore, applying the test of obviousness,

that is, that something in the prior art must itself suggest

the combination of all the ingredients of the patent, I do

not find anything in Comstock, Cremona, Claghorn and

the prior art cited by the Patent Office that suggests put-

ting together that “one fixed and several free floating”’

arrangement, together with a non-round shaft. Variations

on the non-round shaft have been around for years in one

application or another. In fact, I’ve got an old corn planter

at home, an International Harvester corn planter, that |

think uses one of the patents that was cited here, the

British Deering patent, that has a non-round shaft in it

for certain kinds of drive applications. So that certainly

has been around but the fact that it has been arourd,

doesn’t mean that the inspiration to use it in this particular

application was a matter of obviousness. There is an old

Latin saying ex nihil ninilo fit, you don’t make something

out of nothing. I’ve forgotten just what the literal trans-

lation of it is, but anyway, that is the maxim that is

applicable, and Judge Markey has recognized that. He has

got a footnote in one of his cases that says only God

proceeds from no previously known elements. Everything

proceeds from some known elements. So, therefore, for

the reasons that I have stated, patent 341 is not antici-

pated or obvious. There was some evidence that Mr. An-

drews had previously (before 1970) adopted a similar

36a

solution to problems arising from temperature variation in

a metal belt, but I do not find that that is sufficiently

clear and convincing to show prior public use of the idea.

It is not documented anywhere. There is no way that it

would have come to anybody’s attention. It is probative

of obviousness, but it does not, in my judgment, meet the

test for overcoming the presumption of validity. With re-

gard to infringement of the ’341 patent, it is not contested.

The sprocket as manufactured by Cambridge and as taught

in their engineering devices, has one fixed and several free

floating, it’s on a square shaft and it clearly, literally infr-

inges.

With regard to patent ’949, which is the raised rib, I

find that '949 is not anticipated in any single reference.

I also find that it is not obvious in light of the moveable

stair patents of Fox and Risler, which are the main patents

that have been cited against it in this Court. In considering

the scope of the prior art, I have also considered the

patents cited against it in the patent prosecution, as re-

cited in item 56 of the patent, and in particular, the La-

peyre '141 and Poerink patents. As to the Lapeyre ‘141

patent, I do not find from the earlier Lapeyre that one

would look at that flat surface there disclosed and it would

then be obvious to one ordinarily skilled in the art to stick

veins on it, to stagger them, and figure out a way easily

to transfer items from one belt or surface to another, so

I don’t think there is any obviousness arising from Lapeyre

’141. It certainly doesn’t anticipate '949, and I don’t think

that '949 is obvious in light of Lapeyre ’141. Whether you

take Lapeyre ‘141 alone or in combination with Fox and/

or Risler, or you take Fox alone or in combination with

the other, or Risler alone or in combination with the oth-

ers, Fox and Risler are moving stairs; they are not devices

for the transfer of inanimate objects. They convey people,

but people are ambulatory. People step off a moving stair

at some point, so the idea of smooth, non-tipping transfer

of inanimate objects is simply not pertinent. You try to

37a

make an escalator so that it doesn’t make somebody stum-

ble getting off, but nonetheless it’s within the common

experience of mankind that unless you step lively off an

escalator, you'll wind up falling on your face. In fact, it’s

also within the common knowledge of mankind that there

are people to this day who will not get on an escalator

because they are afraid of falling on their face. Clearly,

elderly people and the disabled can’t use them; they have

to use elevators, as an alternative, as you know if you’ve

ever been in the Metro or railroad station, or any place

like that. If the escalator had a smooth transfer or the

moving walk had a smooth transfer device, then it could

be used by people who were elderly or disabled, or what-

ever, and not able to ambulate well under their own power.

In any event, it is a horse of a completely different color.

As has been pointed out by Mr.Lapeyre himself—he is not

a man that I would call aged, but he’s been around a

while—he said his mother took him into department stores

that had escalators when he was a little boy. Escalators

have been around a long time and they have always, I

think it’s also a matter of common knowledge, had some

kind of mating comb at the top of them to keep little boys

from throwing things in them that would gum up the

works. It’s basically a device to filter out trash, so that

it doesn’t stop the machine. Frankly, I think that in this

case there was the necessary spark of inventiveness to

take the '949 patent out of the realm of obviousness when

viewed against prior escalator art. Even though there was

in the prior art some indication of staggering of veins to

get a smooth fit, you would notice that those veins are

staggered, but they also have with them matching curved

surfaces which are intended to produce a seamless planar

surface; nonetheless, they do it in a way that is completely

different from what Mr. Lapeyre teaches in the ’949 pat-

ent, in my judgment. When it comes to the Fox and Risler,

I also find that they are not modular in construction, and

949 clearly calls for modular. So, to find a combination

38a

of elements that are the inventive essence of ’949, which

is modular construction, channels in a transfer device to-

gether with staggered arrangement of ribs so as to get a

smooth planar surface, with a multiplicity of channels and

a transfer device built in, that, in my judgment, has the

necessary degree of inventiveness so as to take it out of

the realm of obviousness and, considering all the factors

in Graham v. John Deere and also Fromson, and consid-

ering especially as to the raised rib patent, the commercial

success of it, and the industry need as evidenced by the

Ashworth advertising brochure, I would find that ’949 is

not obvious, not invalid, and it has not been proved so by

clear and convincing evidence.

The questions on ’949 as to infringement, the first ques-

tion is literal infringement. This is as to claims 21, 22,

an? 24, which are the claims asserted against this one.

As to paragraph 1 of claim 21, the accused device reads

right on it. As to paragraph 2 of claim 21, the accused

device reads right on it; there is no argument as to those

two paragraphs. As to paragraph 3, the accused device

also reads right on it. There is no question about that.

There is a question, though, about paragraph 4, whether

the link ends are dimensioned and spaced apart by a dis-

tance slightly greater than their width on the accused de-

vice. For reasons I have already stated in connection with

’141, I find that in the Cam-Clean, the link ends are spaced

apart by a distance slightly greater than their width, and

as to paragraph 5 of claim 21, the accused device reads

right on it. As to paragraph 6 of claim 21, the accused

device thus reads right on it without any dispute. As to

paragraph 7, paragraph 7 calls for veins that form a mul-

tiplicity of channels that are adapted to receive the teeth

of a transfer comb. There is no question that the accused

device reads right on that.

The only question is whether the elongated veins of the

module of the accused device are staggered in relation to

39a

the veins of adjacent modules. There has been considerable

discussion of that particular item, and I find taking the

patent as a whole, and there certainly is nothing in the

patent that militates against this construction, that the

patent does not call for staggering in the direction of

travel; it simply calls for staggering of veins of one module

with relation to that of another. In the accused device,

when viewed transversely to the direction of travel, that

is, along the axis of the pivot rod, there is no question

about the fact that the veins of one module are staggered

with relationship to the veins of another module. There-

fore, I find literal infringement of claims 21, 22, and 24;

22 and 24 being dependent claims of patent ’949. On the

question of equivalents, if I were to go on to address the

question of equivalents, there is no question in my mind

at all that the raised rib Laitram and the Cam-Clean are

equivalent. The Cam-Clean performs substantially the same

function by substantially the same means, in a substantially

identical way and manner. It presents a planar, or smooth

surface in the direction of travel which with a multiplicity

of channels; it’s a seamless plane, that is, viewed trans-

verse to the direction of travel, it presents a seamless

plane that prevents the tippage of unstable items, and

there is a multiplicity of channels into which the transfer

comb or other transfer device can fit. That transfer device

can be set precisely at the level of the planar or surface

of the belt or slightly below it, whichever is better for

handling the particular product, thus giving a very smooth

transfer surface. The testimony of Mr. Garicke of the

Seven Keys preserving plant was to the effect that the

Laitram product is successful in that regard, and that in

fact the concept works. The concept of channels with combs

and veins that are staggered so as to present a trans-

versely seamless surface is identical as between Laitram

’'949 and Cam-Clean.

Going on to patent '763, I find that ’763 is not anti-

cipated in any single reference. The question of obvious-

40a

ness of 763 is perhaps the most difficult of all the

obviousness problems in this case. Bearing in mind again

that the defendant must prove this by clear and convincing

evidence to overcome the presumption of validity, I have

considered the scope of the prior art. The prior art includes

the very few patents that were cited against it in the

Patent Office. Only four, one of which was Lapeyre ’141,

were cited against it in item 56 of patent ’763. There are

a number of other patents, the Poerink, Harvey, Wood,

and Homier patents that are relevant prior art. With re-

gard to Poerink, Poerink, of course, does not call in my

judgment, for modular construction. It calls, very much

like King, for taking a bunch of bent wire loops, King had

links, but this one has bent wire loops, and welding them

together so you get something that sort of looks like a

barbeque grille, only it’s not formed in a circular way like

a barbeque grille, but, anyway, that is what it looks like.

It does not suggest a way of taking the lateral slop out

of the belt when you assemble a Poerink belt. If you look

at Harvey, Harvey does not show any means of exposing

the pivot rod; all it shows is that you can flare or dovetail

some link ends, in order to provide for sideways movement

of links with respect to each other along a sinuous path.

If you look at Wood, it’s true that Wood has some spacing

means, but Wood calls for its little nibs or dogs to be

pressed by identation into the individual links, so as to

form, really, a very rigid belt that does not allow for

flexion in the lateral direction, as I read it, nor does it

allow for exposing the rod to inspection. Poerink allows,

certainly, for exposing the rod to inspection, but it does

not have any means of maintaining a relatively good lateral

alignment. If you look at Homier, which is Pl.’s Ex. 96,

you see a spacing means, but the spacing means is simply

a bending of a member. As per figure 11 of Homier, the

spacing means is bending over one of the link members,

which would not, in my judgment, suggest the use of the

machined-in, semi-circular little dogs at the opposite ends

4la

of the module as taught in the Kewley-Demarest ’763. So,

I do not find that anyone who was ordinarily skilled in

the art, looking at all those together would come up with

the idea of combining a modular plastic (or any modular)

belt (or even a module, for that matter) that was able to

be put together by assembling a series of like modules

that could expose a substantial amount or all of the pivot

rod for USDA inspection, which is what ’763 was for, yet

maintain relative lateral stability. None of them that I see,

none of the prior art that I have discussed, teaches any

kind of flexion or resiliency as a means of inspection. I

also find that the patent is not invalid under § 112 for

failure to specify resiliency in all claims. I think that claim

8 and the other claims are satisfactorily specific under

§112 of the patent code. Therefore, I find that the

defendant has not shown invalidity of ’763 by clear and

convincing evidence sufficient to overcome the presump-

tion of validity, nor has it been shown invalid under 35

U.S.C. § 112. With regard to the Lapeyre ’141, it is not

obvious. It is not obvious in light of Midlane, because

Midlane had no lateral movement in it. Wood teaches cov-

ering the rod, and a nib on each link, as I have indicated.

Whether it is obvious in terms of Lapeyre ‘141, that is,

would it have been obvious just to shave down the links

of Lapeyre ’141, thereby exposing the rod, is a question.

But if you shave down the ‘141 links, you still have the

problem of maintaining relative lateral spacing so as to

get a belt that is not so sloppy that it comes off a sprocket,

and in my judgment there was a spark of inventiveness

to come up with a spacing means that need only be placed

at each end of the module, still allowing it to have com-

pletely modular construction, but allowing the belt to be

shifted manually so as to expose most if not all of the

rods. I find that it is not obvious in light of Lapeyre ’141,

either alone or in conjunction with the other patents.

Going on to infringement of ’763, as to claim 1 and

dependent claims 2 and 4, the first question is whether

42a

there is literal infringement, and I find that there is literal

infringement of ’763. Reading the claims against the ac-

cused device, as to claim 1, paragraph 1, there is no ques-

tion about it, it reads right on it. Paragraph 2 reads right

on it. Paragraph 3 of claim 1, reads right on it. Paragraph

4, in my judgment, reads right on it. The link ends looking

from the top of the module, you have to read the claim

in terms of the purpose of exposing the rod that is stated

in the claim. It says, the link ends of each module being

of a width substantially less than the spacing between

confronting link ends along the pivotal axis thereof to

provide a substantial space between confronting link ends

thereby to expose for inspection and cleaning a substantial

portion of the pivot rod connecting adjacent modules. So

it’s calling for a small width for the purpose of exposing

the pivot rod for the purpose of inspection and cleaning.

The sloping link that is adopted in the Cam-Clean is very

narrow at the top; thereby it exposes for inspection and

cleaning a substantial amount of the pivot rod. It slopes.

It’s narrow at the top and it’s wide at the bottom. Here,

claim 1, paragraph 4, concerns itself only with exposing

the rod for inspection and cleaning. From the top of Cam-

Clean, a substantial amount of the rod is so exposed, which

is the natural way anybody would inspect it and clean it.

You don’t stick your head between the top and bottom of

the belt and inspect it from the bottom. Looking at it

from the top, the width of the link ends in the Cam-Clean

is substantially less than the spacing between confronting

link ends at their widest point, so that one can look down

and see exposed for inspection and cleaning a substantial

portion of the pivot rod. This is the way it’s designed. I

also find no inconsistency between this and my earlier

findings with regard to ’141 and ’949, that is, as to the

language spaced apart by a space only slightly greater

than the width of the link ends, because you obviously

have to measure spacing width at the widest point of

something. In terms of how far apart things are, where

43a

they intermesh, you have to measure them at their widest

point. Here, the narrowest point of Cam-Clean links is at

the top where one exposes the rod for purposes of in-

spection and cleaning. So, the fact that it has a slope in

it means that you can read Cam-Clean as against ‘141,

certainly by equivalents, and also against ’763, literally.

As to paragraphs 5 and 6, they read right on the accused

product.

As to paragraph 7, I also find literal infringement, be-

cause the link ends are in fact resilient. They are not as

resilient as ’763 in the form that each product is currently

manufactured, but the Cambridge literature reveals that

you can buy this thing in two different kinds of plastic.

Intralox manufactures its belts in three kinds of plastic.

The only embodiment of the accused device I have seen

is not terribly resilient, but it is resilient, and you can,

by manual pressure, flex link ends with respect to each

other and with a tool (a screwdriver, or some other tool),

you could flex them even more with regard to each other,

although they are clearly not as resilient in the way they

are manufactured as the examples of the K-D ’763 of

Intralox that have been shown here in Court. Nonetheless,

there is resiliency and they can be made more resilient

by a simple choice of manufacturing material. Cam-Clean

modules could get very resilient, depending on what they

are made of.

With regard to equivalents, I find that with regard to

claim 1, there is also infringement by equivalents because

Cam-Clean performs substantially the same function in

substantially the same way by substantially the same

means, that is, you can laterally flex, there’s enough slop

in the belt that you can move it without tension, and you

can put tension in it so as to depend on resiliency to

expose unexposed portions of the rod—not all of the rod,

maybe only a percentage of the rod—but, nonetheless, it

is flexible, and because of the slope you can look down

on it and see a substantial portion of the rod without doing

44a

anything. In terms of presenting a readily inspectable pivot

rod, in a modular plastic belt, the Cambridge certainly

does, in my judgment, infringe by equivalents, and I see

nothing in the file wrapper that precludes a finding of

equivalents as to claim 1 of ’763. The file wrapper talks

in terms of flexure, but there is nothing that I see that

precludes ’763 from claiming Cam-Clean as an equivalent.

For example, if there were something unique about the

shape of those little spacing dogs on the ’763, and that

had come up during prosecution history, perhaps there

would be an estoppel raised as to that. With regard to

claim 8, I find there is literal infringement, in my judg-

ment, the accused device reads on claim 8. There is no

question about the first paragraph. There is no question

about the second paragraph. The only question about the

third paragraph is the one dealing with elongated mem-

bers. I have already discussed the same question of elon-

gated members in connection with ’141, and I think that

there is a substantial identity here. Even though the elon-

gated members are not straight in the Cam-Clean, none-

theless, they are elongated members, even though they do

have a bend in them. The width I have already talked

about, and for the same reasons I have already stated as

to claim 2, I find that paragraph 5 is also literally infr-

inged. Also, claim 8 is infringed by equivalents. Claim 8

doesn’t even call for resiliency, and claim 8, as I said, the

Cam-Clean does essentially the same thing, that is it is a

module that has all of the factors of claim 8. Even if I

were to find that paragraph 4 were not literally infringed

because of the elongated member problem, I would still

find that it was infringed by equivalents, because the elon-

gated member in a semi-box or ‘“H’’ configuration per-

forms substantially the same function in substantially the

same way, that is, by providing a rigid link between link

ends. I would find that the dependent claims of the ’141

patent and the dependent claims 2 through 4 of the ’763,

are also infringed for the same reasons that I have stated

45a

in connection with the independent claims of each of those

patents. Unless I have stated otherwise, the findings of

infringement on the independent claims means that I have

also found infringement on the dependent claims, unless

there is some need to make separate findings of fact with

regard to the dependent claims, which I don’t think there

is under the state of the record.

The remaining question is as to relief. The plaintiff is

entitled to an injunction under § 283 of the patent code,and

an injunction will be issued. I also find that under § 284

of the patent code the plaintiff is entitled to lost profits,

which I find to have been proved with a requisite degree

of certainty by the damage claim of $831,820.00 that has

been established by the last page of Pl.’s Ex. 111. The

lost profits proved at trial, in my judgment, really do

represent lost sales opportunities that Intralox would have

had, since it is limited to those who had been customers

or who had been quoted jobs by Intralox in the past, with

a subclass where there had been head-on-head competition

between Intralox and Cambridge. So, the damages are not

speculative. The preference under § 284 of the patent code

is to award lost profits where they have been proved by

non-speculative evidence, rather than to grant a royalty.

Therefore, the judgment will be for $831,820.00 in lost

profits. Also, costs of this suit will be granted.

With regard to the question of willful infringement and

attorney’s fees, these are always vexatious questions. The

cases under § 284 and § 285 are all over the lot on willful

infringement and attorney’s fees. I think that the consen-

sus of the cases is that I would have to find conscious

and willful or persistent infringement in order to award

treble damages, which are essentially exemplary or puni-

tive damages. Very frankly, there is certainly no proof

here of persistent infringement. This Cam-Clean product

hadn’t been on the market but for a few months before

this lawsuit was filed. So, I cannot find persistent in-

fringement. When it comes to conscious and willful in-

46a

fringement, which, in my judgment, requires either a

showing that there had been bad faith, unconscionable con-

duct, or a ‘Chinese copy” without any effort to show any

independent inventiveness, I do not find that there is a

sufficient showing of willful infringement, conscious in-

fringement, or persistent infringement to justify any ex-

emplary damages in this case. My reasons are several. |

have already mentioned one, i.e., that there is no showing

of any course of persistent infringement. With regard to

consciousness and willfulness, although I am not enamored

of what you might call the Nuremberg defense, which is

relying on others to do their duty in a right or lawful

way, it doesn’t absolve you of all duty to exercise inde-

pendent judgment (as Lt. Calley and others found out,

usually at the end of some war), nonetheless, as it trans-

lates to the patent area, I think that you cannot in this

case find that there has been sufficient bad conduct to

award exemplary damages. Frankly, Cambridge went to

ADL in the reasonable, good faith expectation, I find, that

,ADL would design them something that did not infringe

on anybody’s patent. In the event, for reasons that I have

stated at great length this afternoon, I do find that the

Laitram patents were infringed, but there certainly was

a good faith attempt on the part of Cambridge to come

up with a novel design that did not infringe on any pat-

ents. The patent matrix was done. There was communi-

cation between Mr. Pink and Mr. Brinkman with regard

to the matter. There was not a cavalier disregard, nor

was there a rushing on to the market with an item that

looked exactly like the Laitram item. I think that the

important thing for the question of infringement, is

whether it does the same thing in substantially the same

way and by substantially the same means. Certainly when

you get down to infringement by equivalents and even

literal infringement, as you can see from what has gone

before in this opinion, it is often a matter of hairsplitting

too. We’ve been splitting hairs in here for nine days before

47a

we've come up with a solution to the legal dilemma. There-

fore, I do not find that there was any bad faith on the

part of Cambridge. Certainly Cambridge was motivated by

a desire to compete in the market place, but that is the

American Way, and there is nothing wrong with a good

faith desire to compete in the market place and it is not

to be punished by exemplary damages. They didn’t go out

and steal the tooling drawings from Mr. Lapeyre’s product,

they didn’t photograph it and make tooling drawings from

it, they went out and paid a whole lot of money to ADL.

As it turns out, very frankly, although it is res inter alios

as far as this lawsuit is concerned, I think that ADL gave

Cambridge the impression by going through this patent

matrix business that ADL could be relied upon to design

something that would not infringe on the disclosed art.

There is no question that they all had the Intralox patents

foremost in mind, because they were the best things on

the market. That’s really not in dispute in this lawsuit.

But, Cambridge relied on ADL to do a job and ADL didn’t

do it so as not to infringe. As it turned out, ADL covered

itself by sticking something in the end of its contract that

said, By the way, if this thing infringes, don’t call us.

Well, as between Cambridge and ADL, that’s for them to

work out, but it certainly doesn’t show me bad faith on

the part of Cambridge, and that is what I would have to

find in order to award exemplary damages. The case law,

and there is case law still cited that goes back to before

World War II on this under § 284 and § 285, says you

don’t award exemplary damages or attorney’s fees where

the issues were close and fairly debatable and were liti-

gated in good faith, which is what happened here. The

issues were close and fairly debatable and litigated in good

faith, I feel. Not to mention by extremely talented and

diligent attorneys on both sides.

I thank both of you and your support teams for your

efforts in this case., I think you did an excellent job. I

hope I wasn’t too hard on you, but my job is to keep

48a

things moving. As you can see, I’ve always got 20 other

things to do besides being here in the courtroom, so my

time is limited and I honestly do not have another day

open until July when I could continue the trial of this

case, so it had to move on. But, it was a pleasure having

both of you here in court and I did appreciate your pres-

entations. You both did an excellent job. Mr. Joyce, even

though I found for plaintiff in this lawsuit, you really gave

me a work out and made me think long and hard about

everything in the case. You presented an excellent, ex-

cellent defense. It couldn’t have been done better in any

way, but I’ve got to call them as I see them, factually

and legally, and there you have it. I think frankly in patent

cases, the District Court is often a way station anyway,

as you might wind up in Washington in any event, but,

especially, where there’s a lot of money involved as in a

case like this, I'll probably be reading out it in the back

of some F2d. somewhere someday. Nonetheless, I think

you both did an excellent job on this case and it was a

pleasure to have you both.

In view of the findings and conclusions that I have an-

nounced, the judgment is for the plaintiff on all counter-

claims. Judgment is for the plaintiff for injunctive relief

pursuant to 35 U.S.C. § 283; damages in the amount of

$831,820, pursuant to 35 U.S.C. § 284; and the Court finds

that neither exemplary damages under 35 U.S.C. § 284

nor attorney’s fees under 35 U.S.C. § 285 is warranted by

the facts.

Mr. Hayes will draw up a judgment that embodies those

points. So it will grant an injunction in accordance with

the usual form for injunctions in such cases. Damages in

the amount of $831,820, with interest from the date of

judgment at the legal rate. Costs of this suit; judgment

for the plaintiff on the counterclaims; judgment for the

defendant on the issues of exemplary damages and

attorney's fees. Also, judgment will also recite that the

Court has found the four patents in suit not proved invalid

49a

and also a finding that the four patents in suit are infr-

inged for reasons stated in findings and conclusions recited

in open court.

Amendment to Findings and Conclusions, Requested in

Open Court

I find clearly that the perforated top, Pl.’s Ex. 58, lit-

erally infringes claim 19 of '141. Paragraph 1 reads on it.

Paragraph 2 reads on it. Paragraph 3 reads on it. Para-

graph 4 clearly reads on it. So, claim 19 and dependent

claim 20 is infringed by the perforated top Cam-Clean. |

also find, then, for reasons previously stated, as applied

to my physical inspection of Pl.’s Ex. 58, that it infringes

19 of ‘141, if not literally, then also by equivalents.

I also find that the perforated top, Pl.’s Ex. 58, reads

on claim 8 of 763, literally infringing it, and if not lit-

erally, it infringes by equivalents. It performs substantially

the same function by substantially the same means, in

substantially the same way as the '763 patent.

Within 10 days of the entry of judgment is the time

for new trial motions or other post-judgment motions, or

motions, and specifically for any motion under Rule 52 for

additional or different findings of fact.

Dated: March 19, 1985 /S/FREDERIC N. SMALKIN

FREDERIC N. SMALKIN

United States Magistrate

50a

APPENDIX D

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF MARYLAND

CIVIL ACTION NO. HAR 83-3126

THE LAITRAM CORPORATION and INTRALOX, INC.,

Plaintiffs

Wa

THE CAMBRIDGE WirE CLOTH COMPANY,

Defendant

JUDGMENT

Plaintiffs, The Laitram Corporation and its wholly owned

subsidiary Intralox, Inc., brought the present patent in-

fringement suit against defendant, The Cambridge Wire

Cloth Company, for damages and injunctive relief as a

consequence of alleged patent infringement.

Defendant responded by asserting patent invalidity, non-

infringement and inequitable conduct defenses and by fil-

ing counterclaims seeking a declaration of patent invalid-

ity, unenforceability and non-infringement. Defendant also

has counter-claimed alleging sham litigation, unfair com-

petition and patent misuse for which attorneys’ fees, ex-

penses and costs are sought.

This matter was tried before the Court for nine days

commencing February 25, 1985 and ending March 8, 1985.

For the reasons set forth in particular detail in this Court's

oral findings of fact and conclusions of law rendered in

open court pursuant of Fed.R.Civ.P. 52(a) at the conclusion

of trial,

5la

IT IS HEREBY ORDERED, ADJUDGED AND DE-

CREED that:

1. Judgment is entered for plaintiffs on their Amended

Complaint. The Court finds that defendant’s CAM-CLEAN

close rib product (PX 33) has infringed, either literally or

under the doctrine of equivalents, claims 1, 2, 10, 11, 15,

19, 20, and 21 of U. S. Patent No. 3,870,141; claims 21,

22, and 24 of U. S. Patent No. 4,051,949; claims 1, 2, 4,

5, 6, 7 and 8 of U. S. Patent No. 4,159,763; that

defendant’s CAM-CLEAN perforated top product (PX 58)

has infringed either literally or under the doctrine of equiv-

alents claims 19, 20, and 21 of U. S. Patent No. 3,870,141

and claim 8 of U. S. Patent No. 4,159,763; and that use

in a conveyor drive system of defendant’s sprocket and

non-circular drive shaft assembly has infringed claims 1,

2, and 3 of U.S. Patent Re. 30,341.

2. Judgment is entered for plaintiffs on each of

defendant's Counterclaims. The Court finds that U. S. Pat-

ents Nos. 3,8/0,141; Re. 30,341; 4,051,949; and 4,159,763

are not invalid under 35 U.S.C. §§ 102, 103 and 113, nor

are these patents unenforceable due to alleged inequitable

conduct, unfair competition or patent misuse, nor are the

plaintiffs estopped because of the prosecution histories of

said patents from maintaining that the claims identified in

paragraph 1 cover the accused products by equivalents.

3. Judgment is entered for plaintiffs in the amount of

$831,820, representing lost profits, plus interest from the

date of this Judgment, and costs, and defendant is ordered

to provide an accounting of sales of CAM-CLEAN prod-

ucts, including square footage sold and quantities of CAM-

CLEAN sprockets on non-circular shafts sold, from Jan-

uary 1, 1985 to the date hereof.

4. Judgment is entered for defendant on plaintiffs’ re-

quest for attorney’s fees and exemplary damages since the

Court finds that defendant did not wilfully infringe

plaintiffs’ patents.

52a

5. Unless the respective claims identified in paragrpah

1 are subsequently found to be invalid, not infrined and/

or unenforceable, defendant is hereby enjoined for the life

of U.S. Patents Nos. 3,870,141, 4,051,949 and 4,159,763

from the manufacture, use and sale of defendant’s CAM-

CLEAN close rib product (PX 33); for the life of U. S.

Patent Nos. 3,870,141 and 4,159,763 from the manufac-

ture, use sale of defendant’s CAM-CLEAN perforated top

product (PX 58) or the structural equivalent thereof, and

for the life of U.S. Patent No. Re. 30,341 from the man-

ufacture, use and sale of sprockets and non-circular drive

shafts for use in a conveyor drive system as defined in

claims 1-3 of U. S. Patent No. Re. 30,341.

6. Provided, however, that the order for accounting in

paragraph 3 above and the injunction in paragraph 5 above

are stayed, pursuant to FED. R. CIV. P. 62(a), until the

filing of a notice of appeal, and may be stayed thereafter

pursuant to FED. R. CIV. P. 62(d).

JUDGMENT RENDERED AND SIGNED THIS 19TH

DAY OF MARCH, 1985.

/s/Frederic N. Smalkin

FREDERICK N. SMALKIN

United States Magistrate

53a

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APPENDIX F

Excerpts from Joint Appendix in Appeals Nos. 85-2247

and 85-2248 (Pages 2-099 to 2-106)—Testimony of J. M.

Lapeyre, Sr., Co-Inventor of Patent 3,870,141

* . *

Q. Now, Mr. Lapeyre, I’d like to refer you to Claim 19

of the 141 Patent.

A. Um hum.

* - «

Q. Claim 19, a linked belt. Do you agree that it’s a

linked belt?

A. It hasn’t said belt yet.

Q. Well, I pointed to the word belt on page four of the

translation.

A. A belt of this type. All right. Okay. We’ve got belt.

Q. I’m looking at Figure Three. That’s a linked belt

isn’t it?

A. Figure Three is a linked belt.

Q. Comprising in combination a plurality of like modules.

Can you find a plurality of like modules in Figure Three?

A. In Figure—

Q. Figure Three, sir. The next page.

A. That’s Figure Nine.

Q. I’m sorry. Excuse me. Figure Nine.

A. No. I said there’s a plurality of modules but some

of them are not like modules.

57a

. But many of them are like are they not?

. Many of them are like, yes.

. But a few—

. A few are not alike.

. A few are not alike.

. Yeah.

Q. Okay. Because they don’t have a plurality on both

sides. But we do have a plurality of like modules in there

although there—

> O fF O PF 6

A. There is a plurality of like modules.

Q. Okay. And each of said modules including the first

plurality of link ends of like width.

A. 11] admit to that.

Q. The second plurality of link ends each of said like

width.

A. All right.

Q. And an intermediate section integrally formed with

and joining said first and second plurality of link ends.

A. All right.

* * *

Q. Yes. The link ends of each of said modules being

releasably engaged between and substantially in contact

with link ends of an adjacent module except for individual

link ends disposed at the extreme sides of said belt. Do

you agree with that?

A. Right. All right.

Q. And does this Patent disclose means for pivotably

connecting said modules and engaged link ends?

58a

A. Yes.

Q. Now, referring to Figure Nine again, are said mod-

ules arranged in staggered relation with the side edge of

each module being disclosed, intermediate the side edges

of an adjacent pivotably connected module?

A. In some cases that’s true.

Q. So that relative motion of each and adjacent modules,

parallel to a line through engaged link ends thereof is

prevented by the engagement of said engaged link ends?

A. Yes.

* * *

Q. Okay. Now, Mr. Lapeyre, with the belt of the type

disclosed in the Patent that we’ve just been talking about,

Defendant’s Exhibit 28, wien that belt is under load, will

the pivot hinges—I’m sorry, will the hinge pins be purely

and shear?

A. Yes.

Q. Now, you’ve have a chance to study that Patent. Are

you—

A. I’ve read it. I can’t say I’ve studied it, Mr. Joyce,

but I’ve read it.

Q. Well, we’ve gone through it. Are you at this point

willing to or ready to visualize a situation where you have

on each of the modules say 100 link ends on each side?

A. We'll try. I'll try for you.

Q. Will you do that? All right. In that case, would there

be a plurality of like modules in the arrangement, when

staggered in the manner of Figure Nine?

A. Yes.

Q. And without laborously going over the rest of the

Claim, would you agree that each of the elements of Claim

59a

19 therefore would find correspondence in such a version

of Malard.

A. Yes.

* * *

Q. And haven’t you just agreed with me, sir, that that

Malard Patent completely anticipates Claim 19 of your 141

Patent?

MR. HAYES: Objection.

THE COURT: Overruled. Answer the question.

A. It’s yes. It’s certainly pertinent.

* * *