Appendix — Broadview Chemical Corp. v. Loctite Corp.

CONTENTS

PAGE

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Defendant’s Objections to Certain of Plaintiff’s

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Transcript of Proceedings, January 22, 1968 ....... A-13

Opmaion of the Distriet Courté ...0..ccssccsccccsss A-28

Opinion of the Court of Appeals .................. A-42

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF CONNECTICUT

BROADVIEW CHEMICAL

CORPORATION CIVIL ACTION

vs. r NO. 10713

LOCTITE CORPORATION et al)

STIPULATION OF FACTS

It is hereby stipulated by and between the parties to the

above entitled causes, acting through their respective coun-

sel, that the facts which are not in dispute are as follows:

1. Loctite Corporation is a Connecticut Corpora-

tion having its principal place of business at Newing-

ton, Connecticut.

2. Broadview Chemical Corportaion is an Illinois

Corportaion having its principal place of business at

Broadview, Illinois.

3. George Kaplan and Louis Kaplan are doing busi-

ness as Kaplan Brothers at Waterbury, Connecticut.

4. Loctite Corporation, which was formerly named

American Sealants Company, has been engaged since

1954 in the business of manufacturing and selling seal-

ant compositions.

5. Broadview Chemical Corporation has been en-

gaged since August 1963 in the business of manufac-

turing and selling sealant compositions.

6. George Kaplan and Louis Kaplan doing business

as Kaplan Brothers have purchased Broadview

Chemical Corporation products.

7. Loctite Corporation has charged Broadview

Chemical Corporation and Kaplan Brothers with in-

PERL MR A ee as

ety

A-2

fringement of U. S. Patents Nos. 2,895,950; 3,043,820

and 3,046,262.

8. Loctite Corporation is the owner of U.S. Patents

Nos. 2,895,950; 3,043,820 and 3,046,262.

9. Broadview Chemical Corrortaion knew of the

Loctite Corporation products and patents at the time

it commenced the manufacture and sale of its own

products.

10. Loctite Corporation kas charged Broadview

Chemical Corporation and Kaplan Brothers with acts

of unfair competition in copying Loctite Corporation’s

packaging and literary styling and descriptions and

illustrations.

11. Broadview Chemical Corporation has charged

Loctite Corporation with unfair competition in the

distribution of a notice to the trade which is attached

to the complaint in Civil Action 10713 as Exhibit A.

Distribution of this letter by Loctite is admitted.

12. There is no dispute as to the Court’s juris-

diction.

13. The claims of Loctite Corporation’s patents

which are in issue and are charged to be infringed by

Broadview Chemical Corporation products and the

Broadview Chemical Corporation products from

among the formulations given in the answers to Loc-

tite Corporation’s interrogatories: which are charged

to infringe the Loctite Corporation patents and which

therefore are in issue are as follows:

CLAIMS PRODUCT FORMULA NO.

1, 2, 5, 8, 10 and 27 of III, V-X XVIII inclusive

Patent No. 2,895,950 and XXX-XXXIT inclusive

1, 2, 4 and 11-14 of IV-VI inclusive

Patent No. 3,043,820 IX-XII inclusive

XVI, XXIV, XXV, XXVI,

XXVIII and XXXII

foie init Hace na Ss o

A-3

CLAIMS PRODUCT FORMULA NO.

9 of Patent No. 3,043,820 V, VI, IX-XII inclusive

XVI, XXIV, XXV, XXVI,

XXVIII and XXXII

1, 2 and 4-6 inclusive of II, III, V and VI

Patent No. 3,046,262

14. Broadview Chemical Corporation marks its

sealant products with the trademark Sta-Lok and with

the name of Broadview Chemical Corporation.

15. The containers used by both parties are pur-

chased from commercial manufacturers.

James R. Sweeney

Attorneys for Broadview Chemical |!

Corporation and George Kaplan et al

John M. Prutzman

Attorneys for Loctite Corporation

[Caption Omitted]

CONSENT DECREE

This cause coming on to be heard, upon the pleadings

and proceedings heretofore had herein, and it being repre- 3

sented to the Court that the parties hereto have settled

their differences with respect to the matters in dispute, and

upon the sub-joined consent of the parties acting through

their attorneys, it is hereby:

ORDERED, ADJUDGED AND DECREED:

1) That this Court has jurisdiction of the parties and of

the subject matter hereof;

2) That United States Letters Patent Nos. 2,895,950

issued July 21, 1959; 3,043,820 issued July 10, 1962; and

A4

3,046,262 issued July 24, 1962, were duly and legally issued

and are good and valid at law, and Defendant is the sole

owner thereof.

3) That Plaintiff has infringed said United States Let-

ters Patent Nos. 2,895,950; 3,043,820 and 3,046,262 by the

manufacture and sale of products made under formulations

covered by said Letters Patent;

4) That Plaintiff, its officers, directors, employees,

agents, successors and assigns be and they are hereby en-

joined from infringing said United States Letters Patent

Nos. 2,895,950; 3,043,820 and 3,046,262;

5) That Plaintiff’s second cause of action and Defend-

ant’s second counterclaim be and the same are hereby dis-

missed with prejudice;

6) That Plaintiff having made a monetary payment to

the Defendant, no damages shall be awarded as a result of

this action; and

7) That each party pay its own costs and attorneys fees

in this action.

M. Joseph Blumenfeld

United States District Judge

Date: Feb. 14, 1967

WE HEREBY CONSENT TO THE ENTRY OF THE

ABOVE DECREE:

BROADVIEW CHEMICAL LOCTITE CORPORATION,

CORPORATION, DEFENDANT

PLAINTIFF

By: Frank E. Callahan By: Lindsey, Prutzman

& Hayes

By: Robert B. Snow, Jr. By: Jobn M. Prutzman

205 Church Street 100 Constitution Plaza

New Haven, Connecticut Hartford, Connecticut

Its Attorneys Its Attorneys

A-5

EXHIBIT “A”

(Attached to Memorandum of Fact and Law in Support

of Plaintiff’s Motion to Modify Consent Decree)

SETTLEMENT AGREEMENT

This Agreement made and entered into the 3rd day of

February, 1967, by and between Loctite Corporaticn, a

corporation existing under the laws of the State of Con-

necticut, and having a principal place of business at 705

North Mountain Road, Newington, Connecticut 06111 (here-

inafter called Loctite), and Broadview Chemical Corpora-

tion, a corporation existing under the laws of the State of

Illinois, and having a principal place of business at 2910

South 18th Avenue, Broadview, Illinois 60155 (hereinafter

called Broadview),

WITNESSETH:

WHEREAS, there is now pending in the United States

District Court for the District of Connecticut a suit be-

tween the parties, Civil Action 10,713, in which Loctite has

charged Broadview with infringement of its United States

Patent Nos. 2,895,950, 3,043,820 and 3,046,262; and

WHEREAS, there is also pending in the United States

District Court for the District of Connecticut a companion

suit, Civil Action No. 10,678, between Loctite and George

Kaplan and Louis Kaplan, d.b.a. Kaplan Brothers (here-

inafter called Kaplan), a customer of Broadview, in which

Loctite has charged Kaplan with infringement of said

United States Patents; and

WHEREAS, there is pending in the Exchequer Court

of Canada a suit between Loctite and Albion Asbestos

Packings Limited (hereinafter called Albion), a customer

of Broadview, in which Loctite has charged Albion with

Oe en a ee ae ee re

A-6

infringement of its Canadian Patent Nos. 618,882 and

669,026; and

WHEREAS, there has been no judgment or decree in

said suits and the parties hereto are desirous of settling

said litigation;

NOW, THEREFORE, in consideration of the premises

and the mutual covenants hereinafter set forth, the parties

hereto covenant and agree as follows:

1) Upon execution of this agreement, Broadview shall

pay Loctite the sum of Seventy-Five Hundred Dollars

($7500.00).

2) Contemporaneously with the execution of this agree-

ment the parties agree to the settlement of said Civil Ac-

tions and said Canadian Action as follows:

a) The parties through their attorneys shall execute

and file with the District Court for the District of

Connecticut a Consent Decree in said Civil Action No.

10,713 in the form attached hereto as Exhibit 1.

b) The parties through their attorneys shall execute

and file with the District Court for the District of

Connecticut a Stipulation for Dismissal of said Civil

Action 10,678 in the form attached hereto as Ex-

hibit 2.

c) The parties through their attorneys shall execute

and file with the Exchequer Court of Canada a Consent

to Judgment which in substance is covered by the form

attached hereto as Exhibit 3 but which may be modi-

fied as to form, if necessary, to meet the requirement

of the Court.

3) The parties hereto do further agree to release each

other and contemporaneously with the execution hereof do

execute and deliver to each other releases in the form at-

tached hereto as Exhibits 4 ana 5.

A-7

4) Should there be any disagreement between the parties

hereto with respect to the propriety of any action by either

of the parties that is governed by the Consent Decrees

(Exhibits 1, 2 and 3) or this Agreement, it is agreed that

the party feeling itself aggrieved will first notify the other

party of such grievance, and that said aggrieved party will

thereafter negotiate with said other party in good faith

for a reasonable time, not less than thirty (30) days after

such notice, toward the solution of such grievance, failing

which said aggrieved party may make such grievance pub-

lic, notify customers or dealers of the other party of such

grievance and/or bring suit on such grievance.

5) The Broadview formulations referred to in the Con-

sent Decree (Exhibit 1) are:

Formulations II through XXVIII inclusive

Formulations XXX through XXXII inclusive

6) If the Consent Decree is exhibited or published it

shall be exhibited or published in its entirety.

7) THIS AGREEMENT shall be binding upon the par-

ties hereto, their successors and assigns.

8) THiS AGREEMENT shall be construed under the

laws of the State of Connecticut as applicable to contracts

made and to be performed within the State of Connecticut.

LOCTITE CORPORATION

By Robert H. Krieble

Title Pres.

Poke ee,

ene re

RENT EOE OPT TING SALON TRIE BH

of le NOT O

MB BREA NT ih et Sich a I ea Ree ORE IE a sel AD ON Rs Ne RA eis on |e

(Broadview’s answer to Loctite’s interrogatory number 23, submitted in camera)

INGREDIENTS IN POUNDS

Formamide

CEP

(Cumene

Hydroper-

a

Salt of

-

=

~-_

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Dye

Acrylic

acid

peroxide) auinone

Succini-

mide

Phthali-

mide

in

tormamide

Ditsode-

cyl-

phthallate

-

(Dimeth- DAPON

SR-206

acrylate)

SR-210

(Dimeth-

acrylate)

A-8

BROADVIEW’S FORMULATIONS

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No.

A-9

[Caption Omitted]

DEFENDANT’S OBJECTIONS TO CERTAIN OF

PLAINTIFF’S INTERROGATORIES

Defendant, Loctite Corporation, by its counsel, objects

to Defendant’s Interrogatories Nos. 86, 87, 90, and 92 to

102, inclusive, in accordance with Rule 33, F. R. Civ. P. The

interrogatories and reasons for objecting to them are set

forth hereinbelow:

Interrogatories Nos. 86 and 87:

86a. Referring to commercial sealants sold by the de-

fendant during the period between early 1955 and October

14, 1959, did any of those sealants contain a monomer of

the formula of any of the claims of U.S. patent No. 3,043,820

in combination with hydroquinone?

- 86b. If the answer to Interrogatory No. 86a is in the

affirmative, what is the identity of each of such monomer,

and the hydrquinone by chemical name, trade name, and

source, and how much hydroquinone was present in the

sealant composition based on such monomer?

86c. If the answer to Interrogatory No. 86a is in the

negative, relating to sealant compositions sold by defend-

ant during said period and containing a monomer of said

formula, what stabilizer, inhibitor and/or retarder ingredi-

ent was present and ir what amount in each such sealant

composition.

86d. If the answer to Interrogatory No. 86a is in the

negative, what were the ingredients and the amounts of

each ingredient included in each sealant composition sold

by defendant during said period. s

86e. If the answer to Interrogatory No. 86a is in the

Pee Fee) Rt . < Py ee Oe Oe Ie

A-10

affirmative, what was the date of mixing and the last date

of sale of each such sealant composition?

86f. If the answer to Interrogatory No. 86a is in the

negative, was hydroquinone and/or any ether of hydroqui-

none ever included in a sealant composition containing said

monomer and sold by the defendant during said period.

86g. If the answer to Interrogatory 86a is in the affirma-

tive, are there any documents in the defendant’s possession

or under its control relating to the composition of such

commercial sealants?

86h. If the answer to Interrogatory No. 86g is in the

affirmative, what is the identification of each of the docu-

ments sufficient for a Motion to Produce under Rule 34

FRCP? If the defendant is willing to allow plaintiff by

its counsel to inspect and make copies of the documents,

it is not necessary to identify them in response to this

interrogatory.

86i. If the answer to Interrogatory No. 86a above is

in the affirmative, was a commercial hydroquinone-inhibited

monomer used as an ingredient in mixing the sealant?

86}. If the answer to Interrogatory No. 86i above is in

the affirmative, what was the date of receipt of each quan-

tity of such hydroquinone-inhibited monomer and what was

the date of mixing of each commercial] sealant utilizing the

hydroquinone-inhibited monomer?

86k. If the answer to Interrogatory No. 86a above is

unknown, what is the identity of each monomer of said

formula used in the manufacture of commercial seaJants

sold by the defendant between early 1955 and October 14,

1959, by chemical name, trade name, and source?

87a. Referring to commercial sealants sold br the de-

fendant during the period between early 1955 and October

A-11

14, 1959, did any of the sealants contain a monomer of the

formula of any of the claims of U.S. patent No. 3,043,820

in combination with hydroquinone and a hydroperoxide?

87b. If the answer to Interrogatory No. 87a is in the

affirmative, what is the identity of each of such monomer,

hydroquinone and hydroperoxide by chemical name, trade

name, and source, and how much hydroquinone and hydro-

peroxide was present in the sealant composition based on

such monomer?

87c. If the answer to Interrogatory No. 87a is in the

negative, what were the ingredients and amounts of each

ingredient included in each sealant composition sold by

defendant during said period?

87d. If the answer to Interrogatory No. 87a is in the

affirmative, what was the date of mixing and the last date

of sale of each batch of sealant composition?

87e. If the answer to Interrogatory 87a is in the affirma-

tive, are there any documents in defendant’s possession or

under its control relating to the composition of such com-

mercial sealants?

87f. if the answer to Interrogatory No. 87e is in the

affirmative, what is the identification of each of the docu-

ments sufficient for a Motion to Produce under Rule 34

FRCP? If defendant is willing to allow plaintiff by its

counsel to inspect and make copies of the documents, it is

not necessary to identify them in response to this in-

terrogatory.

Objection

Both interrogatories are objected to as irrelevant and

not reasonably calculated to lead to the discovery of ad-

missible evidence. The interrogatories refer to sealants

sold by defendant between 1955 and October 14, 1959, the

latter date being one year prior to the filing date of U. S.

. seh ede o Uae OAT el 2 Pot OEE ee a tnie

ern

A-12

Patent No. 3,043,820, the infringement of which is in issue.

No reasonable basis is apparent why information concern-

ing defendant’s sealants sold long ago is relevant to the

issue of plaintiff’s infringement within the past year. The

validity of U.S. Patent No. 3,043,820 is not in issue here,

since the Consent Decree established the validity of that

patent between the parties hereto.

Interrogatories Nos. 93 and 94

93. Referring to paragraph 3 of the Motion to Punish

for Contempt, does the defendant charge that quinone in a

sealant is infringing where all such quinone results solely

from the presence of hydroquinone in hydroquinone-

inhibited Sartomer Resins SR-210 at ambient temperatures?

94. Referring to paragraph 3 of the Motion to Pun‘sh

for Contempt, does the defendant charge that quinone

in a sealarit is infringing where all such quinone results

solely from the presence of hydroquinone in a mixture

consisting solely of hydroquinone-inhibited Sartomer

Resins’ SR-210, 200 ppm hydroquinone and 0.5 to 2.0 weight

percent t-butyl hydroperoxide?

Objections

Defendant objects to these interrogatories because they

are based on a hypothetical situation not supported by the

record and call for a legal conclusion. Plaintiff assumes

in these interrogatories that quinone results solely from

hydroquinone, which is an unsupported statement. Defend-

ant should not be forced to answer under oath questions

based on pure speculation.

Day, Berry & Howard

W. Robert Hartigan

One Constitution Plaza

Hartford, Connecticut 061U3

Attorneys for Defendant

Bie ee cp bel tS sli ne Mis

A-13

[Caption Omitted]

TRANSCRIPT OF PROCEEDINGS

(January 22, 1968)

MR. AMES:

First, interrogatory 86 and 87. 86(a) says referring to

commercial sealing sold by Defendant, that is Loctite, dur-

ing this period from ’55 to 59. Did any of those sealings

contain a monomer of the formula of any of the claims of

U.S. patent No. 820 patent in combination with Hydroqui-

none.

[9] Now, Your Honor, the issue before us today—and if

we don’t finish all the experimentation at some future date

is—whether the Sta-Lok 500 and Sta-Lok 800 contain

Quinone.

For the purposes of this motion if these compounds, these

compositions do not contain Quinone, the motion will not

be pressed.

THE COURT: In other words you are saying that this

interrogatory has nothing to do with the case?

MR. AMES: It has nothing to do with the case.

In reading what Broadview says, it goes back to ’59 and

before.

Now, the patent in suit was filed on October 14, 1960 and

consequently October 14, 1959 and all the dates before

would tend to invalidate the patent. You have a statutory

bar towards filing on any invention that has been in public

use or on sale more than one year befors the filing date.

THE COURT: So what has that got to do with it?

MR. AMES: The issue of validity has already been de-

termined by this Court, and in that consent decree, Your

ne Mt ees ee Op DoD S adn nil DAM A FARES iad PN! 52 AAP AAR IIIS Hm

A-14

Honor, the 820 patent was held valid and infringed. That

validity is res judicata before the parties.

THE COURT: Just a moment. I don’t know that that

decree amounted to a declaration that the patent is valid.

[10] I am very reluctant to decree validity on the basis

of a stipulation.

I don’t remember. I may have determined that they were

not contesting the validity and did concede that there was

an infringement.

Now, I would approve a stipulation that they infringed,

but I don’t know that I would approve a stipulation of

validity.

MR. AMES: Actually, you can’t infringe an invalid pat-

ent, because it is just something that isn’t there.

THE COURT: I understand. Well, at any rate, regard-

less of my hesitancy at this point, it is your point that as

between these parties at least validity—.

MR. AMES: That’s right. Only between these parties.

THE COURT: —can no longer be an issue.

MR. AMES: Yes, Your Honor. I might call your atten-

tion to paragraph 2 of the Consent Decree which says

that—and includes the 820 patent—duly and legally issued

and good and valid at law.

THE COURT: That is as between the parties.

MR. AMES: Yes, only between the parties.

[11] So while these interrogatories 86 and 87 —.

THE COURT: You say they could have reference only

to the present claim of invalidity based upon some prior

public use?

MR. AMES: That. is the most apparent reason.

Now, in its memorandum that it filed and that I saw

last night, Broadview says something a little different. It

says that that can show—the answer to interrogatories 86

and 87 can show what prior art was, and that Broadview

has a right to come into court now and say, “We are fol-

A-15

lowing the prior art, therefore, we do not infringe,” and

that this is the burden. I don’t think they contest the

validity, but they say validity isn’t all.

THE COURT: Just forget the stipulation.

MR. AMES: So that this deals with infringement. And

we didn’t say that everything we make in the future is

going to infringe these patents which is perfectly right.

So Broadview, as I understand what they want to say,

that they were following the prior art. And they do cite

a case. -

It is a 1928 Circuit Case. That is the only case that

they have cited in their memorandum and I would like to

[12] call Your Honor’s attention to a much more recent

case which is Chemical Cleaning, Inc. versus the Dow

Chemical Company. My citation on this may not be of

much help, because it is in the U.S. Patent Quarterly. This

should be in Fed. 2nd, it’s a Court of Appeals for the Fifth

Circuit.

THE COURT: Where will I find it?

MR. AMES: Well, I shall have someone shepardize it.

THE COURT: It is in the Patent Quarterly?

MR. AMES: Yes. 155 U.S. P.Q. 49. If your Honor cares

I will be happy to leave this. It is July 31, 1967 which

is the reason that we probably don’t have the Fed. 2nd

‘citation. )

If Your Honor cares I will be happy to leave this ad-

vance sheet with you as a gift.

THE COURT: Well, I would appreciate it. Are you

aware of the case, Mr. Sweeney?

MR. SWEENEY: I am not sure, Your Honor. This is

a pretty recent case.

However, I might shorten this whole problem. Our whole

reason for asking this question and some other questions

is that the law is that you are entitled to use what is in

the public domain. No one can have a patent or monopoly

[13] on what is in the public domain.

ROIS

NITES SACRE CALEB RARONENN ITE RPE

ARO AE PING IIA TE) NILE ENED IEE OR

SE IE VIPLIL OME

sii vase ities 5 %e din RRA RET '

A-16

So we are merely trying to ascertain what is in the

public domain. There are several areas in the public domain

we are talking about.

If we can agree here that Hydroquinone, which is this

other material Your Honor mentioned, is not covered by

the claims of this patent, or the use of Hydroquinone is

not covered, then there is no need for us to proceed with

these interrogatories. And I suspect, from what Mr. Ames

said, that he may be willing to admit that.

MR. AMES: I am willing to admit—I mean the burden

is thrust upon me that if there is no quinone used—I

shouldn’t say “used”—if there is no quinone in what they

sell in the Sta-Lok 500 and in 800, or whatever products

they sell, then there is no infringement of the 820 patent.

MR. STAPLETON: The patent specifically excludes on

its-face Hydroquinone as being included in the claim, in

the claimed monopoly. <All I want to establish is that since

we use Hydroquinone, that is our position, that our use

of Hydroquinone in this combination does not infringe the

claim. That is all I am trying to show by these interrog-

atories.

[14] MR. AMES: One of my problems is this, Your

Honor: Counsel says he uses Hydroquinone. I honestly

think this is the basis of the whole difficulty. Broadviews

says it uses Hydroquinone. We say—.

THE COURT: What do you mean by that? You put

Hydroquinone into your product?

MR. SWEENEY: That’s right. We do not use Quinone,

we use Hydroquinone.

THE COURT: But you don’t put Quinone in, you put

Hydroquinone in.

MR. SWEENEY: That’s right, Your ——

THE COURT: I suppose your claim is going to be that

he put Hydroquinone and because of se he got in

it it becomes Quinone?

A-17

MR. AMES: We have no idea how the Quinone gets in

there but we do know that we test their products and get

a perfect test for Quinone. Whether it is an impurity, a

reaction, I don’t think the burden is on us. These are prod-

uct claims, Quinone is an element, we find Quinone.

MR. SWEENEY: The point is, Your Honor, that the

prior art, the material in the public domain shows the use

of Hydroquinone.

[15] Now, if putting Hydroquinone into this composition

in some mysterious way result in Quinone—.

THE COURT: Well, chemistry is not a mystery, at least

not to me.

MR. SWEENEY: My point is that if it happens now

it would have happened in the prior art and that, there-

fore, no matter how it happens it is old, and all I want to

establish is that this patent does not cover the use of

Hydroquinone in the composition.

Now, these questions are designed to elicit evidence as

to what the Defendant did in 1959 and before, which is part

of public domain.

THE COURT: Well, as I understand Mr. Ames, he

doesn’t say that you are infringing by using Hydroquinone.

He says you are infringing because the product contains

Quinone.

MR. SWEENEY: That’s right, Your Honor.

THE COURT: There is no factual dispute about that.

MR. AMES: No.

MR. SWEENEY: The guide line, if you will, for the

proof in this particular motion, I would merely like to

establish that Hydroquinone, the use of Hydroquinone is

not covered. That is aside from this question of whether

[16] there is Quinone there or not. The use of Hydroqui-

none isn’t covered, that’s all I would like to establish.

MR. AMES: All I can say is that this is not a use pat-

ent, it’s a patent on the product, and that if he uses ten

Pb CN PL Se PRR A

, A-18

different items we are sympathetic or unsympathetic, and

all we care about is whether he has Quinone in the final

product.

MR. SWEENEY: The patent covers a composition of

a particular monomer, a particular Hydroperoxide and

Quinone, that’s what the claim covers, that’s the monopo-

lized invention.

I merely want to establish that the patent doesn’t cover

the monomer, the Hydroperoxide and Hydroquinone as a

composition. That is all I am trying to establish by these

interrogatories.

MR. AMES: Perhaps I am being overly technical. But

the question is whether it covers what Mr. Sweeney says

to the exclusion or inclusion of Quinone. If there is

Quinone and Hydroquinone, then we assert that it clearly

falls within the claim.

MR. SWEENEY: I think maybe I can satisfy you then.

My point is that if we used these three that I have men-

tioned monomer, Hydroperoxide and Hydroquinone with-

out any Quinone, that there is no infringement.

[17] MR. AMES: Again Mr. Sweeney has said “use.”

What he puts in is no concern to us, although we are sym-

pathetic. It is what he gets out, what product he sells,

because this is a product patent.

THE COURT: Well, I understand the issue that is

being raised, and I also take it for granted now that this

interrogatory would be answered—well, it wouldn’t need

to be asked if you concede that your only claim is limited

to objection to the presence of Quinone in the product.

MR. AMES: Yes, Your Honor. The claim is so limited.

If there is only Hydroquinone or only anything else, but

no Quinone, we do not claim it.

THE COURT: You do not claim that they have no right

to use Hydroquinone?

MR. AMES: Not so far as this patent is concerned.

Oe ae ‘.

A-19

To just quote very briefly, Mr. Sweeney may be inter-

ested in this recent case, it says—.

THE COURT: Before we get to that, I assume that

bears upon how an application of patent law, but on this

factual issue raised by the objection to the interrogatories,

you are satisfied, are you—these are your interrogatories?

MR. SWEENEY: That’s right, Your Honor.

[18] THE COURT: And you are satisfied now with this

answer of Mr. Ames?

MR. SWEENEY: I am satisfied.

THE COURT: Now, that takes care of what, 86 and 87?

MR. SWEENEY: We may be able to take care of some

others.

THE COURT: Good. I thought I gave you fellows a

recess ard that is when I expected these things to be taken

care of.

MR. SWEENEY: Interrogatory No. 90 we had asked

whether Hydroquinone is the equivalent of Quinone within

the meaning of the patent. And I presume that from your

answer that you agreed that Hydroquinone is not the equiv-

alent of Quinone within the meaning of the patent.

MR. AMES: I agree. This is objected to, frankly, be-

cause “equivalent” is a legal term. As far as I am con-

cerned the doctrine of equivalence is the foremost points

of argument in most pieces of patent litigation, and we

objected to answering a legal question of that nature.

MR. SWEENEY: I will pass No. 92 because we can’t

settle that with this particular agreement.

[19] Going to Nos. 93 and 94—.

THE COURT: All right. That takes care of 90?

MR. SWEENEY: That’s right. Nos. 93 and 94 asks

whether Loctite charges compositions in the public domain

with infringement. I presume from what we have said here

that you do not charge compositions in the public domain

which contain Hydroquinone with infringement.

Pe vee v

A-20

MR. AMES: We would never, as a matter of course, if

we wish to sustain the validity of a patent charge that any-

thing in the public domain infringed, because of the doc-

trine that that which anticipates if earlier infringes if later.

We would never say that something that anybody can

use infringes their patent.

MR. SWEENEY: These interrogatories have asked

whether or not they charged the compositions containing

Hydroquinone was an infringement of the patent, and I

presume that you do not so charge.

MR. AMES: To which interrogatory are you referring?

THE COURT: 93 and 94.

MR. SWEENEY: 93 and 94.

MR. AMES: Well, this 93 is completely different [20]

from what has been stated. .

It says, “Where all such Quinone results solely from the

presence of Hydroquinone and Hydroquinone inhibiters”

—this is all theoretical. Where the Quinone comes from,

there is no proof that it comes from the Hydroquinone or

comes from any place.

MR. SWEENEY: The point here is, Your Honor, that

the prior art, the public domain has used Hydroquinone in

a composition like that covered by the Loctite patent. In

other words, this is in the prior art, the mixing or the

compounding of the monomer, the Hydroperoxide, and the

peroxide and Hydroquinone—.

THE COURT: He already said he doesn’t challenge

your right to use Hydroquinone. He only challenges your

right to have a composition which contains Quinone.

MR. SWEENEY: Now I want to know by this inter-

rogatory whether they charge a composition which is made

using the Hydroquinone. For some reason they think there

is Quinone in it as a result of having compeunded it, in

other words, having put together what was old, if that

putting together, in some way that I don’t understand,

an al

A-21

results in the production of Quinone do they charge that

to be an infringement of the patent? Because if they do

[21] then what they are charging to be an infringement of

the patent. today would have been old in the prior art.

Chemicals can change.

THE COURT: Well, I understand your argument. I’m

not sure it is so, you know. You are simplifying it for

purposes of saying that this is what resulted in the prior

art.

MR. SWEENEY: That’s right.

THE COURT: Well, I don’t know that that is so. And

you told me that you don’t know.

-MR. SWEENEY: I’m being honest, Your Honor. I don’t

know.

I am trying to look for the basis of their charge in this

contempt proceeding.

THE COURT: But now you want to know whether if

it is so, they claim you have no right to do it.

MR. SWEENEY: That’s right. That’s all I would like

to know. I think he can answer it yes or no.

THE COURT: I don’t know how he can. You say nobody

knows what happens when you put these things together.

But he can still say whether he claims.

MR. SWEENEY: That’s right. That is all I am asking.

THE COURT: What do you claim, Mr. Ames?

[22] MR. AMES: We claim if it has Quinone in it, it

infringes.

THE COURT: No matter how it happens?

MR. AMES: Right.

THE COURT: Well, suppose they say if it has Quinone

in it, the only thing we put into our product is what is well

known in the prior art and this results in Quinone. Then

they say, “Well, you don’t have much of a leg to stand on

any more.”

MR. AMES: First of all, I might just quote to you the

case that we just pulled out, the Dow Chemical Case.

ty IOt MDE emmy =

A-22

It says, “Furthermore, proof that CCI’”—that wis the

infringer—“was practicing an expired patent should have

been adduced at the original infringemert proceedings”.

This is a contempt, a motion to punish for contempt, and

CCI the infringer, said, “Oh, but we are practicing some-

thing in the prior art” and it was not. The Court of Ap-

peals for the Fifth Circuit a half-year ago said, no—.

THE COURT: Too late now.

MR. AMES: Too late.

THE COURT: All right. That’s another point.

MR. SWEENEY: There was no hearing on any of these

[23] points.

THE COURT: That is just a case of being estopped,

you can’t raise it now. If we are going to raise something

now that can’t be decided and ought not to raise it at all,

why get into it?

MR. SWEENEY: Your Honor, during the proceedings

in this case, before the entry of the decree, in answer to

the Defendants’ interrogatories we gave them all of the

formulations that we were vsing to make commercial prod-

ucts. The were filed in camera, they are here in court.

I don’t believe they are in this building. I am informed

they may be in New Haven.

THE COURT: Probably. There is better security there,

a bigger vault, cr something.

MR. SWEENEY: At any rate, we have copies of that

and I doubt if there will be any problem.

They charged thirty of the thirty-two compositions that

we gave them were being an infringement of these three

patents.

In preparation for the trial which didn’t take place, we

stipulated certain evidence under the Court’s Order, and

one of the things we stipulated was the comvonents of the

compositions that were cha_ged to infringe. here was no

[24] charge made as to these two compositions. Those

A-22

two compositions used Quinone [sic: hydroquinone]* and

are substantially the same thing as what we are using today.

I don’t think, therefore, that we should be estopped from

claiming that we were doing what was old then as to those

compositions, because we are still doing it.

There is no judgment, no estoppel, there is no rule

against us continuing to use those two compositions.

So that it can be said—.

THE COURT: I really don’t know, I’m not sure that

I paid very much attention to everything that was contained

in that stipulation.

MR. SWEENEY: I don’t claim that you did, Your

Honor.

THE COURT: Was it in the stipulation specifically?

MR. SWEENEY: Yes, Your Honor.

THE COURT: That you kad the right i» continue to

use—.

MR. SWEENEY: No, they don’t charge them to infringe,

and I don’t think—.

THE COURT: Now you say that all you are doing is

using those?

[25] MR. SWEENEY: Right. With substantially minor

variations we are using the same formulation.

Therefore there was no judgment as to those formula-

tions, there was no determination that they infringed and,

therefore, I don’t see how this case is pertinent.

We were following the prior art in making those formu-

lations. The Defendant agreed, the Defendant didn’t even

charge—.

MR. AMES: I am informed—I was not counselor at

that time-—I am informed that we didn’t charge them, be-

cause we didn’t find any on the market.

* A number of obvious, typographical errors appear in the origi-

nal transcript. To aid the Court, these errors have been pointed

out, using the word “sic” followed by the correct word.

A-24

MR. SWEENEY: We gave them the formulations, Your

Honor, and they charge thirty out of thirty-two to infringe.

MR. AMES: This doesn’t mean that we agreed that two

are not part—.

THE COURT: I suppose what they agreed not to do is

the principal proposition you start with here, not what you

charge them with, but what they agreed not to do.

MR. SWEENEY: We agreed not to make formulations

under the thirty formulas.

THE COURT: I don’t know whether that is what you

agreed or whether you agreed that none of your products

[26] would contain Quinone. Are we concerned here with

whether they are using one of the thirty formulas that they

decided, agreed not to, is that the way it comes up?

MR. AMES: I have here what I think are thirty-two

formulas including the two—.

THE COURT: The question is what did they agree that

they would not do, that they would not use thirty formulas?

MR. AMES: No. I can just go by the wording of it. Of

course, there is Your Honor’s decree.

After it says that the patents in suit are good and valid

at law, “that Plaintiff has infringed said United States

letters patent”—those three patents “by the manufacture

and sale of products made under formulations covered by

said letters patent, that they are enjoined from infringing.”

In Your Honor’s Order there is no mention of—.

THE COURT: Thirty that they will not use.

MR. AMES: Thirty. Right. Then there is a settlement

agreement.

MR. SWEENEY: Which does clarify it clearly.

THE COURT: I would hope there is something there to

clarify. a

MR. SWEENEY: The settlement agreement in para-

[27] graph 5 says the Broadview formulation as referred

A-25

to in the Consent Decree Exhibit 1 are, and it lists them,

2 through 28 and 30 through 32.

Nos. 1 and 29 are not included, they are the two that

were not charged, they are the two formulations on which

we are presently basing all production.

MR. AMES: I would have to disagree with that. I have

the formula for the thirty formulations, and I don’t see

Quinone in any of them. Maybe I just haven’t read it

properly.

Do you find Quinone in any of these?

MR. SWEENEY: Well, there is no Quinone in any of

them. That doesn’t mean that we can’t settle the case and

agree that we won’t make certain formulations, which is

what we did.

MR. AMES: Where is it in writing that you settled the

case on this basis?

MR. SWEENEY: I think the settlement agreement is

pretty clear.

MR. AMES: There are thirty-two formulations of which

thirty were evidently included in the Consent Decree. None

of the thirty-two formulations, including the two errant

ones mentions Quinone, it all says Hydroquinone.

MR. SWEENEY: That’s correct. We never used

[28] Quinone.

THE COURT: Well, we still get back to the same basis,

first is there Quinone, and second—.

MR. AMES: However one looks at it, if there is Quinone

in what they sell now, and they admit to usi:g the two

other ingredients, then I can’t see how they can say they

don’t infringe.

MR. SWEENEY: Then, Your Honor, I think I would

have to persist that these interrogatories be answered.

These are 93 and 94 and apparently we can’t agree on any-

thing here.

MR. AMES: I would cite the Dow Chemical Case.

TREN ha RARE in Ri Bh 5 St AFR PE Bie rns Man

A268

THE COURT: “Does the Defendant charge.” I suppose

it means do you claim that Quinone in a sealant is infring-

ing where it all results solely from the presence of Hydro-

quinone in a mixture consisting solely of Hydroquinone—

inhibited sartomer—.

MR. AMES: No. 1, that is theoretical. I honestly don’t

feel that we should have to answer some kind of a theo-

retical question. He can ask a thousand questions.

THE COURT: Well, suppose that that is so. Do you

claim he can’t do that if he buys this sartomer resins or

an inhibiter, that they can’t use it because it results in

Quinone?

MR. AMES: I would say No. 1—and I hope it doesn’t

[29] look as though I am trying to evade something—I

may be trying to but in the formulations that Mr. Sweeney

has been kind enough to give us in camera of his present

formulations, he adds Quinone—he adds Hydroquinone,

consequently all the Quinone couldn’t result solely from the

presence of Hydroquinone in the Hydroquinone inhibited

Sartomer resins because he adds extra Hydroquinone.

THE COURT: Well, who does he get the Sartomer

resins from?

MR. AMES: Sartomer. That’s a trade name.

THE COURT: Suppose they started to make a BSR210,

and because it was B they added a little more a

at the plant, then what?

MR. AMES: Who knows what.

THE COURT: I mean just because they have got some.

in there, not enough, but suppose it would tolerate a little

more and to accommodate Broadview they would say we

will give you a special BSR210—.

MR. SWEENEY: All I want to know is whether or not

they would charge that composition with infringement. I

wish I knew what composition would, how much—.

ofl To te A TABI ites SAI

A-27

THE COURT: That which contains Quinone, or at least

results in a product that contains Quinone.

[30] MR. AMES: I should point out again that since

Broadview adds it Hydroquinone independent of any Hy-

droquinone in the Sartomer resins, it is impossible—that

this can not possibly happen, because Broadview today

adds extra Hydroquinone.

THE COURT: Then you push him back to the other

ground he asserts, which is if they added Hydroquinone—.

MR. AMES: But how much? We don’t know how much

Hydroquinone you have in order to give Quinone, if it

does give Quinone, and what conditions Hydroquinone can

oxidize, it appears, to Quinone. But under what conditions

we don’t know.

THE COURT: He says at ambient temperatures.

You mean in the presence of what—.

MR. AMES: Of what catalyst or what oxidizing agent.

MR. SWEENEY: If this happens, then it would have

happened with the prior art composition, and all I want to

know is whether or not they charged a composition which

contains Quinone regardless of how it got there.

THE COURT: Well, that is a little different, isn’t it?

We don’t know what the prior compositions were. You have

said that you got some little modifications in here and they

may not be the prior art that you are practicing.

[31] What you do in the prior art doesn’t seem to justify

it either at this point.

MR. SWEENEY: Woald you prefer, Your Honor, to

reserve ruling on this particular set of interrogatories until

you have heard the evidence?

THE COURT: I prefer not to rule at all.

MR. SWEENEY: I can’t say that I blame you.

THE COURT: All right. Let’s pass it then. That will

be deferred.

A-28

UNITED STATES DISTRICT COURT

DISTRICT OF CONNECTICUT

BROADVIEW CHEMICAL )

CORPORATION

vs.

LOCTITE CORPORATION

» Civil No. 10,713

RULING ON MOTION

TO PUNISH FOR CONTEMPT

On June 1, 1964, Broadview Chemical Corporation (here-

inafter Broadview), an Illinois corporation having its

principal place of business in Illinois, filed an action against

Loctite Corporation (hereinafter Loctite), a Connecticut

corporation having its principal place of business in

Connecticut, seeking a declaratory judgment as to the

validity of certain Loctite patents. Loctite, which had pre-

viously complained to Broadview that the latter’s “Sta-Lok”

products were infringing Loctite’s patents on anaerobic

curing sealant compositions, organic adhesives which bond

metal to metal in the absence of air, counterclaimed for

infringement.

On February 14, 1967, the parties consented to the entry

of a decree which held that United States Letters Patent

Nos. 2,895,950 (the ’950 patent), 3,043,820 (the ’820 patent),

and 3,046,262 (the ’262 patent) were valid, that the defend-

ant was their sole owner, that the plaintiff had infringed

them, and that it be enjoined from any future infringement

of those patents.

Loctite now charges Broadview with contempt for viola-

tion of the injunction decreed. In its original motion filed

September 21, 1967, Loctite alleged that Broadview’s then

A-29

products “Sta-Lok 800” and “Sta-Lok 500” directly in-

fringed the ’820 patent in that they contained quinone, one

of the basic ingredients of the sealant compositions covered

by the ’820 patent. The plaintiff, although it denies the

presence of quinone in its products, does admit that the

deliberate use of quinone would infringe the defendant’s

patent. It claims, however, that it would not be liable if

the presence of quinone in its products results from a

chemical reaction among other ingredients in its products.

After extensive discovery by Loctite, a supplemental

motion to punish for contempt was filed on April 2, 1968,

in which Loctite alleged several additional bases for a find-

ing of contempt. First, Broadview allegedly reshipped or

resold products prohibited from sale by the consent decree,

which had been returned to it for-eredit. This merchandise

was in the hands of Broadview’s distributors at the time

the decree was filed.

Second, Loctite claims that Broadview’s present formula-

tions, newly designated as CP-1 through CP-9 since the

decree, are not essentially different from plaintiff’s pre-

decree formulations which it had admitted were infringing.

Specifically, Broadview has substituted one base monomer,

Sartomer Resin SR-210, for another—Sartomer Resin SR-

206. Loctite claims that this substitution effected no sub-

stantial chemical difference in the composition, only a slight

difference in the final strength of the adhesive bond.

Third, Loctite states that Broadview’s post-decree CP-1

through CP-7 formulations have no functionally different

effect than the formulations protected by the ’262 patent.

The ’262 patent protects sulfimide sealant compositions

free from amines (the absence of the normally present

amines contributing to the length of the shelf-life of the

product). Loctite contends that the addition of minute

quantities of amines in plaintiff’s sulfimide sealants which

Ree a

POET ESERIES

bik cals nica Ripa PE, i RIE INS en SO Ae rt anne 2 ee We aad OES

A-30

have no significant effect on the shelf-life does not render

the plaintiff’s product non-infringing.

An extensive hearing was begun on January 22, 1968, and

was continued to permit further discovery and to assure the

availability of certain witnesses at the resumption of the

hearing. To accommodate counsel for both sides, the hear-

ing was not resumed until May 28, 1968.

The Contempt Motions

-_

In a civil contempt proceeding for violation of provisions

of a consent decree, a court is restricted in its examination

and decision to that conduct which is clearly enjoined by

the decree.?

_ “They [consent decrees] are to be read within their

four corners, and especially so because they represent

the agreement of the parties, and not the independent

examination of the subject-matter by the court. They

are binding only to the extent to which they go. Neither

court nor party can write in them what is not there,

and thus change what was agreed upon between the

parties.” American Radium Co. v. Hipp, Didisheim

Co., 279 F. 601, 603 (S.D. N.Y. 1921), aff’d, 279 F. 1016

(2d Cir. 1922).

1. The consent decree states in part:

“2) That United States Letters Patent Nos. 2,895,950 issued

July 21, 1959; 3,043,820 issued July 10, 1962; and 3,046,262 issued

July 24, 1962, were duly and legally issued and are good and valid

at law, and Defendant is the sole owner thereof.

“3) That Plaintiff has infringed said United States Letters

Patent Nos. 2,895,950; 3,043,820 and 3,046,262 by the manufacture

and sale of products made under formulations covered by said

Letters Patent ;

“4) That Plaintiff, its officers, directors, employees, agents, suc-

cessors and assigns be and they are hereby enjoined from infring-

ing said United States Letters Patent Nos. 2,895,950; 3,043,820 and

8,046,262;”’

A-31

Hart Schaffner & Marx v. Alexander’s Dep’t Stores, Inc.,

341 F.2d 101 (2d Cir. 1965). Cf. Artvale, Inc. v. Rugby

Fabrics Corp., 303 F.2d 283 (2d Cir. 1962).

There must be “clear and convincing” proof of a violation

of a court order. Hart Schaffner & Marx v. Alexande;s’s

Dep’t Stores, Inc., 341 F.2d 101; Stringfellow v. Haines, 309

¥.2d 910 (2d Cir. 1962). This does not mean, however, that

the movant must prove that violation was willful. “Wilful-

ness is not an essential element in civil contempt.” Metalliz-

ing Eng. Co. v. B. Simon, Inc., 64 F.Supp. 848, 849 (W.D.

N.Y. 1945). The question is simply whether the court’s

order has been complied with. United States v. Ross, 243

F.Supp. 496, 499 (S.D. N.Y. 1965).

The validity of the three Loctite patents is not in issue,

for the consent decree, which states that these patents are

valid, has rendered this res judicata for purposes of this

civil contempt motion. Hopp Press, Inc. v. Joseph Freeman

& Co., 323 F.2d 636 (2d Cir. 1963) ; Stebring v. Hansen, 346

F.2d 474, 477 (8th Cir.), cert. denied, 382 U.S. 943 (1965).

Cf. Chas. Pfizer & Co. v. Davis-Edwards Pharmacal Corp.,

385 F.2d 533 (2d Cir. 1967). Since the patents are valid as

between these parties, the question presented is whether the

plaintiff has again infringed them.

With these factors in mind, I shall examine the four

claims raised by Loctite and their relationship to the con-

duct which was permanently enjoined by the consent decree.

Resale or Reshipment

In Broadview’s answers to Loctite’s interrogatories nos.

108 through 111, it appears that Broadview permitted its

distributors to ship admittedly infringing “Sta-Lok” prod-

ucts which had been produced and sold prior to the consent

decree to other distributors after February 14, 1967. The

testimony of James D. Polis, president of Broadview, who

PEER ee ee ee eS

fi haa Cae ts

ye a aS he Re at Re SR IS

a aA RN a PR BE, BPA A RAEN DA ION.

A-32

was called as a witness by Loctite, verified that these trans-

fers were made. There is no merit to the argument that

because the form of the transfer of offending products was

from one distributor to another, with the transferor receiv-

ing a credit from Broadview and the transferee being

debited by Broadview, there was not a sale by Broadview.

Also, the argument that these were transfers without

consideration is as specious as the argument that they were

not sales by Broadview. These transfers were not without

economic benefit to Broadview. Its distributors had been

fearful of selling infringing products and had returned the

“Sta-Lok” products to Broadview which the latter had been

enjoined from marketing. These transfers avoided this loss.

Furthermore, Polis acknowledge that some products

originally sold before February 14, 1967, but returned to

Broadview after that date, were resold directly to other

distributors. Specifically, Polis stated that Haskel Engi-

neering & Supply Company returned some of the “Sta-Lok”

for credit and this merchandise was subsequently sold to

some one else.

Broadview argues that there is insvficient proof that the

products reshipped were both produced from those formu-

lations held to be infringing in the consent decree and

shipped prior to the decree. From the explanation in in-

terrogatory no. 108 and from Polis’ testimony relating te

the “Sta-Lok” products transferred from one distributor to

another, it is clear that these products sold prior to Feb-

ruary 14, 1967, included products produced from those

formulations which Broadview clearly admits infringe.”

2. The settlement agreement underlying the consent decree

states in § 5 that the formulations referred to in the consent decree

and found to have been infringed were Formulations II through

XXVIII and XXX through XXXII. Thus, Broadview admits that

30 of its 32 formulations were specifically found infringing: The

status of the other two formulations will be discussed subsequently.

A-33

The consent decree states that formulations manufac-

tured and sold before February 14, 1967, infringed the ’950,

’820 and ’262 patents. Their resale or profitable reshipment

by Broadview or at Broadview’s request after the decree

infringed those patents in violation of the injunction in this

consent decree. See Western Lighting Corp. v. Smoot-

Holman Co., 352 F.2d 1019 (9th Cir. 1965).

Infringement Through Manufacture

and Sale of Equi, lent Products

The doctrine of “equivalents” is applicable to test in-

fringement of a patent valid between the parties to a con-

sent decree. As originally developed, the doctrine of

equivalents was founded on the theory that “if two devices

do the same work in substantially the same way, and

accomplish substantially the same result, they are the same,

even though they differ in name, form, or shape.” Machine

Co. v. Murphy, 97 U.S. 120, 125 (1877). As pointed out in

Craver Tank x Mfg. Co. v. Linda Air Prods. Co., 339 US.

605, 609 (1950): “Subsequently, however, the same prin-

ciples were also applied to compositions, where there was

equivalence between chemical ingredients.”

Thus, a composition infringes if it has incorporated an

unimporiant variation but performs “substantially the same

function in substantially the same way to obtain the same

result.” Sanitary Refrigerator Co. v. Winters, 280 U.S. 30,

42 (1929). See also Chemical Cleaning, Inc. v. Dow Chemi-

cal Co., 379 F.2d 294 (5th Cir. 1967), cert. denied, 389 U.S.

U.S. 1040 (1968); Locklin v. Switzer Bros., 368 F.2d 553

(9th Cir. 1966), cert. denied, 386 U.S. 963, rehearing denied.

386 U.S. 1027 (1967); Hopp Press, Inc. v. Joseph Freeman

& Co., 323 F.2d 636.

Loctite charges that since the decree was entered Broad-

view has made and sold anaerobic curing sealants which

A-34

trebly infringe the patents. Since 30 of the formulations

which Broadview used prior to the decree concededly in-

fringed the patents, Loctite claims that post-decree use of

any of those would constitute a violation of the injunction.

Logically, there is no reason why the substitution of

equivalents or the introduction of non-affective additional

substances to such prohibited formulations should not also

be regarded under the doctrine of equivalents as insufficient

to erase the infringing character of those formulae. Hopp

Press, Inc. v. Joseph Freeman €& Co., 323 F.2d at 638. Each

of the charges will be examined in turn.

The Change to SR-210 from SR-206

Loctite charged that Broadview’s entire new CP-line of

formulations are not substantially different from formula-

tions admittedly infringing. The testimony at the hearing

was limited, however, to a comparison of CP formulations

CP-8 and CP-9 with formulation IV, one of the offending

formulations used by Broadview prior to the consent decree.

Dr. William Katz, a highly qualified independent expert

in the field of polymer chemistry, testified that he had

examined Broadview’s present formulae and found that

both the CP-8 and CP-9 formulations were functionally the

same as formulation IV. The major distinction between

them was that in both cases, Sartomer Resin SR-210 had

been substituted for Sartomer Resin SR-206. Formulation

IV contained both resins. Katz stated, Broadview’s expert .

did not contradict, and I find that the SR-210 is essentially

the same as SR-206 chemically, with only a slight difference

in its ~ ganic structure which on that account has no sub-

stantial effect on the adhesive strength of the compounded

product. Thus, formulations CP-8, CP-9 and IV are sub-

stantially the same and their differences are not significant.

Broadview did not seriously dispute the fact that the

change from the use of both resins to the use of only one

A-35

in its formulations made a merely colorable difference.

Rather, it chose to rely on the fact -hat the CP-S and CP-9

formulations were identical to the earlier formulations |

and XXIX respectively, these formulations having been

omitted from the list of infringing formulations in the

settlement agreement between the parties dated February

3, 1967. Broadview insists that the exclusion from the

settlement agreement of these specific formulations meant

that they were found not infringing. But the court cannot

either expand or contract the decree. Butler v. Danton, 150

F.2d 687 (10th Cir. 1945).

The question is whether the consent decree, in light of

the settlement agreement, cf, Hamilton v. Rogers, 99

F.Supp. 509 (.D. Mich. 1951), should be read as finding

Broadview’s formulations I and XXIX non-infringing. The

language of the consent decree, which is controlling on this

court, merely states that Broadview manufactured and sold

products “made under formulations covered by said Letters

Patent.” The accompanying settlement agreement, which

specified the violating formulations, was not incorporated

into the consent decree. These admittedly offending formu-

lae are contained in Broadview’s answers to Loctite’s inter-

rogatories 23 and 24 and are subject to a protective order.

(see n.2)

Neither the consent decree nor the settlement agreement

specifically stated that any of Broadview’s formulations

were non-infringing. The settlement agreement identifies

by Roman numerals which formulae were positive viola-

tions of Loctite’s patents; the consent decree enjoined the

manufacture and sale of 30 such formulations.

Since CP-S and CP-9 are equivalent to IV, one of those

specified in the settlement agreement, they infringe. That

I and XXIX were not separately specified in the agreement

does not compel an inference that they were non-infringing;

a

OAL OP OS LOW ea PPL IS

A-36

they are identical to CP-S and CP-9, which Broadview

presently uses. They infringe.

The Addition of Minute Amounts of Amines

Dr. Vernon K. Krieble, a Loctite chemist and inventor,

testified that amines are commonly used and permissible in

sealant compounds in quantities ranging from 0.5 to 5.0

per cent by weight. One of the claims of Loctite’s °262

patent is that the “addition of amine accelerators to the

sulfimides [a category of anaerobic seaiants containing a

sulfimide accelerator] provides no significant advantage in

terms of activity and greatly reduces shelf life so that

amines should be exclude¢ from sulfimide mixtures when

shelf life is desired.” Broadview uses saccharin and benzoic

sulfimide in its compositions CP-1 through CP-7, and an

amine, ethoxyethoxyethoxy propylamine. Because the use

of quantities of amines ranging from 0.5 to 5.0 per cent by

weight with saccharin is claimed to be permissible as being

within the prior art,’ Broadview argues that it cannot be

found to infringe because it uses amines in its formulation.

But it is not the use of amines which is complained of.

Rather, it is the failure to use enough amines to avoid the

claim that amines should be excluded from the composition.

Loctite contends that the use of minute amounts ranging

from 0.025 to 0.05 per cent by weight is “equivalent” to the

exclusion of amines as taught by its patent, and not within

the range disclosed in the prior art.

Dr. Katz, Loctite’s expert, testified that at his suggestion

tests were run on Broadview’s formulation CP-1 with vary-

ing amounts of the ethoxyethoxyethoxy propylamine to

determine the effect of varying amounts on shelf-life.

Gorman, the chemist who ran the tests, testified that the

3. Prior art was not put into evidence at the hearing.

A-37

products made from amounts of the amine ranging from

0.025 to 0.05 per cent by weight lasted more than 600 hours

under test conditions with out hardening, while products

which included the larger amount of 0.5 per cent by weight

lasted only 55 hours. Katz interpreted this to mean that

the minute amounts of amine would have no substantial

detrimental effect on the shelf stability of products made

from any of the CP-1 through CP-7 formulations.

Upon the testimony of both Katz and Gorman and the

absence of any contradicting testimony by Broadview’s

expert, it is clear that such a small amount of amines as

Broadview added to these sulfimide compositions has no

significant effect. It is substantially the same as if no

amines were used. Thus, the CP-1 through CP-7 formula-

tions perform “substantially the same function in substan-

tially the same way to obtain the same result” as the

protected formulations under the ’262 patent. This effective

exclusion of amines thus violates the injunction entered

on the consent decree.

The Use of Quinone

The most substantial issue raised in this contempt pro-

ceeding and towards which the bulk of the testimony was

directed was whether Broadview’s “Sta-Lok 500” and “Sta-

Lok 800” infringed the quinone (’820) patent in disregard

of this court’s injunction. Basically, the quinone patent

forbids the use of quinone in these anaerobic adhesive

sealants. Broadview admits that the deliberate use of

quinone would constitute infringement of the patent and a

‘violation of the injunction, but argues that the mere pres-

ence of quinone is not per se infringing.

In Chemical Cleaning, Inc. v. Dow Chevsical Co., 379 F.2d

994, the protected chemical, thiourea, was compounded with

formaldehyde, but when the compound was put to its

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A-38

intended use the thiourea separated from the formalde-

hyde and the product performed in substantially the same

way as the patented solution. This technique of causing

the release of the chemical in the product was held to

violate the patent under the doctrine of equivalence. Cf.

G.D. Searle € Co. v. Byron Chemical Co., 223 F.Supp. 172,

174 (E.D.N.Y. 1963). Thus, if the quinone here is released

in the sealant through chemical reaction, this too is a viola-

tion of the patent as the quinone is still being used in the

product. It would not matter whether Broadview knew of

the chemical release of the quinone or whether it did this

intentionally for willful intent is not an element in civil

contempt.

Broadview argued that it does not use quinone in “Sta-

Lok 500” and “Sta-Lok 800” but only uses hydroquinone.

The use of hydroquinone in a sealant composition does not

infringe the quinone patent. Loctite, through the use of a

chemical test performed in court, established the presence

of quinone in these products.

In the carefully performed test, Loctite’s chemist Neu-

mann ran four samples. The first test tube contained only

the base monomer used in both the Loctite and Broadview

formulations. The second contained the monomer and 100

parts per million quinone. The third contained monomer

and 100 paris per million hydroquinone. The fourth con-

tained a sample of “Sta-Lvk 500” bought on the commercial

market subsequent to the consent decree. Three acidified

water extractions were performed on each sample and a

final benzine extraction was performed on the resultant

solution. A small amount of diethylamine was added to

each test tube. Within seconds a rosy pink color reaching

a peak of color after 5 minutes developed in both the

quinone and the “Sta-Lok 500” test tubes. The plain

monomer and the hydroquinone solution remained clear.

A-39

This was just what Neumann had predicted. The “Sta-Lok

500” solution was only slightly less pink than the 100 parts

per million quinone solution.

Further testimony by Neumann showed that this color

‘ast for quinone has sufficient validity to meet scientific

standards capabie of testing for the presence of quinone.

Cf. Research Laboratories, Inc. v. United States, 167 F.2d

410, 415-16 (Sth Cir.), cert. denied, 335 U.S. 843 (1948) ;

United States v. 7 Jugs, 53 F.Supp. 746, 759 (D. Minn.

1944). 1t had been used by Loctite to check on the “Sta-

Lok” products to determine if they were infringing. Loctite

found that ir hundreds of tests of products purchased after

the consent decree both “Sta-Lok 500” and “Sta-Lok 800”

contained «uinone. The test and the testimony establishes

that quinone is present in the “Sta-Lok” products.

Dr. Muggli, Broadview’s chemical expert, sought to

challenge the validity of the color test for quinone. Appar-

ently, there was no method for testing for these small

quantities of quinone in solution until Neumann developed

his color test. Muggli endeavored to demonstrate that in

the same test a pink color could also be obtained with only

hydroquinone present.

Muggli did-not perform the same test, but varied it in

certain important aspects. He did not test a quinone

semple, the “Sta-Lok 500” or a control sample of plain

monomer, but only used one test tube containing a hydro-

quinone solution. Instead of the 100 parts per million used

by Neumann, Muggli claimed he used roughly 400 to 500

parts per million, although both Neumann and Gorman, who

were closely watching the test, subsequently testified that

he used at least 2000 parts per million. Tertiary-butyl

hydroperoxide was added to the hydroquinone solution

without any reasonable explanation to the court. The

acidified water extractions and the benzine extraction were

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A-40

performed and the diethylamine was added. After a few

minutes a very faint pink color developed.

The test by Dr. Muggli was not in the least persuasive

of his theory that it was hydroquinone that produced the

pink color in the “Sta-Lok” sample in the first test. Neu-

mann testified that with the larger amount of hydroquinone

and the presence of tertiary-butyl hydroperoxide, there

would be some oxidizing of the hydroquinone to form a little

quinone, this quinone giving the faint pink color. Broad-

view, however, does not use hydroquinone in its products

in such large quantities that would result in oxidation and

the formation of a substantial amount of quinone.

The fact is that the pink color which devolped in the

“Sta-Lok 500” sample in the first test was far darker than

the color produced through oxidation. This certainly

showed the presence of quinone. Loctite has proved with

clear and convincing evidence that there was quinone in

Broadview’s products sold after the date of the consent

decree and, therefore, in violation of the injunction.

I conclude that Broadview is guilty of civil contempt

in each of the four respects considered above.

Damages, Costs and Attorney’s Fees

Although Loctite requested payment of damages suffered

because of Broadview’s contempt, this issne was not

pursued at either hearing and no proof was submitted. In

the absence of a showing of lost profits by Loctite or

profits made by Broadview on its infringing products, there

can be no finding of money damages.

Even though this is basicaily a patent infringement case,

the rule that attorney’s fees are to be awarded only in

exceptional cases (35 U.S.C. § 285) does not apply here as

this is a civil contempt proceeding. Sunbeam Corp. v. Gold-

A-41

en Rule Appliance Co., 25% F.2d 467 (2d Cir. 1958);

Siebring v. Hansen, 346 F.2d 474. It is within the sound

discretion of the court to award reasonable attorney’s fees

and costs. An injunction should also issue enjoining

Broadview, its officers, directors, employees, agents, suc-

cessors and assigns from infringing United States Letters

Patent Nos. 2,895, 950; 3,043,820; and 3,046,262 and spe-

cifically from sale of use of its “Sta-Lok 800” and composi-

tions formulated according to CP-1 through CP-9. For each

future violation of the consent decree the violating persons

shall each pay to Loctite Corporation $2,000.00.

Broadview Chemical Corporation shall pay Loctite Cor-

poration the expenses of prosecuting these motions, includ-

ing counsel} fees. In the event that this amount cannot be

agreed upon between the parties within thirty (30) days,

Loctite shall submit affidavits in support of its claimed

expenses.

SO ORDERED.

Dated at Hartford, Connecticut, this 15th day of June,

1968.

ese eevee reeeeveeeereeeeeeeeee eee eee

M. Joseph Blumenfeld

United States District Judge

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A-42

UNITED STATES COURT OF APPEALS

For THE Seconp Circuit

Nos. 219-220—September Term, 1968.

(Argued December 5, 1968 Decided January 23, 1969.)

Docket Nos. 32722-32723

Broapview CHEMICAL CoRPORATICN,

Plaintiff-Appellant,

vs.

LoctiTE CoRPORATION,

Defendant-A ppellee.

Before:

Lumsarp, Chief Judge,

Frienviy, Circuit Judge, and FRANKEL, District Judge.*

Appeal from an order of the United States Court for the

District of Connecticut, M. Joseph Blumenfeld, J., finding

appellant in contempt of a consent decree enjoining in-

fringement of patents. Affirmed for the most part, reversed

in one respect, and remanded.

GrancerR Cook, Jr. (Hume, Clement, Hume &

Lee, Chicago, Illinois; David A. Anderson,

James P. Hume and Henry L. Brinks, of

Counsel), for Plaintiff-Appellant.

Wa ter D. Ames (Watson, Cole, Grindle & Wat-

son, Washington, D. C.; Robert J. Lasker,

J. Rodney Peck, and W. Robert Hartigan,

of Counsel), for Defendant-Appellee.

* Of the Southern District of New York, sitting by designation.

A-43

FRankKEL, District Judge:

In June of 1964 Broadview Chemical Corporation, the

plaintiff-appeilant, brought the action from which this ap-

peal arises seeking a declaration of invalidity and non-

infringement with respect to several patents held by Loc-

tite Corporation, the defendant-appellee. Following coun-

terclaims charging infringement and a course of discovery

proceedings, the parties, on February 3, 1967, made a set-

tlement agreement which provided for, and incorporated,

the consent decree Broadview has now been found to have

violated. Some limited aspects of the patents and of the

steps preceding the settlement are germane to the issues

on this appeal.

The patents cover anaerobic curing sealant compositions

which serve to bond metals together in the absence of

air (specifically, oxygen)—e.g., when spread upon the

surface of a screw and bolt which, upon being threaded to-

gether, exclude air and are thereby made to adhere to each

other through the action (polymerization) of the patented

composition. In the course of discovery, responding to

Loctite’s interrogatories, Broadview listed the 32 formula-

tions, designated by Roman numerals I-X XXII, of the seal-

ant compositions it was making and selling. Thereafter, in

a stipulation of facts dated May 31, 1966, the parties agreed

in the following language that Loctite’s charges of infringe-

ment (and the “issues” generated by such charges) were

rested upon three patents and directed against the several

formulations, as follows:

The claims of Loctite Corporation’s patents which are

in issue and are charged.to be infringed by Broadview

Chemical Corporation products and the Boardview Chemi-

cal Corporation products from among the formulations

given in the answers to Loctite Corporation’s interroga-

PEN IF RY

ope ge a tm ve

Tt nn eee Mea

7

A-44

tories which are charged to infringe the Loctite Corpora-

tion patents and which therefore are in issue are as follows:

Claims Product Formuia No.

1, 2,5,8,10 and 27 of —_—sSUTT, V-X XVII inclusive

Patent No. 2,895,950 and XXX-XXNIT inclusive

1, 2, 4 and 11-14 of IV-VI inclusive

Patent No. 3,043,820 IX-XII inclusive

XVI, XXIV, XXV, XXVI,

XXVIII and XXXIT

9 of Patent No. 3,043,820 V, VI, [X-XII inclusive

XVI, XXIV, XXV, XXVI,

XXVIII and XXXII

1, 2 and 4-6 inclusive of IT, III, V and VI

Patent No. 3,046,262

In other words, Loctite charged that 30 of Broadview’s

32 formulations (Nos. II through XXVIII and XXX

through XXXII) infringed one or more of the patents. Two

of the foi mulations, Nos. I and XXIX, were omitted from

this listing of “the Broadview * * * products from among

the formulations given in the answers to Loctite Corpora-

tion’s interrogatories which [were] charged to infringe

* * * and which therefore [were] in issue * * *.”

The settlement agreement of February 3, 1967, among

its other relevant aspects, incorporated the stipulated de-

scription of the “charges” and the “issues” in the case, and

tied these to the consent decree, by providing (par. 5):

The Broadview formulations referred to in the Consent

Decree (Exhibit 1) are:

Formulations II thrcugh XXVIII inclusive

Formulations XXX through XXXII inclusive.

And the consent decree, as thus described, after announc-

ing, inter alia, that the parties had “settled their differences

A-45

with respect to the matters in dispute,” adjudged that

Broadview had infringed “Patent Nos. 2,895,950; 3,043,820

and 3,046,262 by the manufacture and sale of products made

under formulations covered by said Letters Patent * * *.”

The decree went on to enjoin further infringeinent of

the named patents; to provide that each party would pay

its own costs and attorneys’ fees; and to state that there

should be no award of damages since Broadview had “made

a monetary payment” ($7,500) to Loctite under the set-

tlement agreement.

The peaceful era thus inaugurated was short. In Sep-

tember, 1967, Loctite moved to punish Broadview for con-

tempt of the consent decree, charging that the latter was

making and selling named products which infringed claims

of Patent No. 3,048,820. Following a hearing and some

discovery, Loctite filed a supplemental motion charging as

further contiumacious acts that:

(1) Broadview had “resold substantial quantities of

admittedly infringing compositions more than five

months after” the signing of the consent decree.

(2) Broadview’s present formuiations CP-1 through

CP-9 were “but colorable imitations of” prior for-

mulations which had admittedly infringed Patent

No. 3,048,820.

(3) Broadview’s formulations CP-1 to CP-7 infringed

Patent No. 3,046,262.

After discovery proceedings and three days of evidenti-

ary hearings, Judge Blumenfeld concluded that all the con-

tempt charges should be sustained. He held, first, tLat the

“resales” of the old, admittedly infringing formulations

violated the decree. Further, he found that all of Broad-

view’s assertedly new formulations (identified as CP-1

SMO AED LLL EL CLE LE LEAD OLE PEELE OES ciated, |

A-46

through CP-9), contrary to the decree’s prohibitions, m-

fringed either Patent No. 3,043,820, or No. 3,046,262, or

both. In a detailed opinion, he explained the bases for these

determinations and prescribed remedial sanctions. .

In its appeal Broadview tenders five questions (we for-

mulate them as four) on which it claims the District Court

erred.* We reject all of these contentions save one, the

effect of our ruling being to absolve only Broadview’s new

compositions CP-8 and CP-9 from the charge of contempt.

I.

As is true of substantially all the District Court’s fact

findings, there is no quarrel by Broadview with the findings

that: (1) Broadview’s distributors, after the consent de-

cree, began returning the products which had been declared

to infringe; (2) Broadview in some cases resold such re-

turned products to other distributors; and (3) in other

eases, Broadview arranged for direct transfers of such

products from one distributor to another, crediting the

transferor with what amounted to returns and billing the

transferee for purchases. Broadview argues, however, that

these post-decree transactions were outside the terms of

the injunction because Loctite, in the settlement agreement,

had given a standard form of reljease “of and from any

and all actions, causes of action, claims and demands which

Loctite Corporation may have against [Broadview, its offi-

cers, customers, ete.] jointlv or severally, from the begin-

ning of the world to the date hereof.” The argument is not

weighty.

The consent decree adjudged that Broadview had in-

fringed by “manufacture and sale” of the condemned prod-

* Loctite filed a notice of cross-appeal, evidently designed to

assert some question about the relief adjudged for the contempt,

but was permitted to withdraw it at the oral argument.

AAT

ucts. It enjoined such infringement for the future. Cf.

Western Lighting Corp. v. Smoot-Holmax Company, 352

F. 2d 1019, 1022 (9th Cir. 1965). The release, because

Broadview was making an agreed payment for the past,

waived any claims for infringement, whether by “mann-

facture” or “sale,” up “to the date” of the settlement. There

Was no suggestion in the customary language of the release

that it was intended to exeuse any acts of infringement

(whether by manufacture or by sale of products already

in existence) after its date. There was no hint of the

thought now pressed that the release gave immunity for

any future sales or uses of products in existence as of its

date. And Broadview introduced no evidence in the con-

ter pt hearing to suggest that the parties had intended any

such unusual meaning. On the contrary, answering inter-

rogatories during the contempt proceedings, Broadview’s

President said he believed “part or all” of the infringing

products in Broadview’s possession on the date of the con-

sent decree had been “discarded or destroyed” and that

none had been “transferred to another for consideration

* * * monetary or otherwise.” True or false, these answers

were consistent with the terms of the decree and the release,

not with the unlikely construction Broadview now proposes.

I.

Insofar as Judge Blumenfeld’s findings of contempt rest

upon his determination that Broadview has, since the con-

sent decree, made and sold compositions infringing Patent

No. 3,043,820, Broadview attacks his decision in an elabo-

rate argument charging (1) that he mistakenly failed to

consider the prior art and (2) that he improperly limited

discovery with respect to the prior art. These interrelated

contentions, to which there are short answers, may be sum-

marized briefly for our purposes.

INS

SEI A NGOM COREE A LEER CEA

A-48

As Broadview states the starting-point for this line of

argument, it is that Patent No. 3,043,820 “covers composi-

tions including (1) a dimethacrylate (monomer), (2) a

hydroperoxide (catalyst), and (3) a quinone (inhibitor).”

Elaborating this summary, Broadview stresses that the in-

clusion of hydroquinone, as distinguished from quinone,

“wos old and in the public domain.” Thus, the argument

continues, “by using or adding hydroquinone to the accused

sealant compositions, Broadview is following the prior art

and is not infringing * * *.”

Insofar as this argument rests upon the specific ingredi-

ents of Broadview’s formulations, it is frivolous. All of

the admittedly infringing formulations under the consent

decree showed hydroquinone as an ingredient; none showed

quinone. Thus, it was obviously not required that quinone

appear as a specific ingredient in the formulation in order

to make the formulation an infringement. It is not more

meritorious to contend, as Broadview does, that the quione

now to be found in its post-decree compositions can only

result from the use of hydroquinone and must, therefore,

be mo more than must have been present in the prior art.

The trouble with this undocumented assertion is that it is

flatly opposed to Judge Blumenfeld’s finding that Broad-

view’s products made since the decree contain quinone

which is not, and cannot be, accounted for by the use of

hydroquinone. Without actually assailing that finding,

which is solidly grounded in the record, Broadview argues

as if it did not exist. The argument must obviously fail.

The point about limited discovery regarding the prior

art is an even shorter subject. Having examined the per-

tinent portions of the record, we find that Judge Blumen-

field actually placed no restrictions like those now suggested

upon Broadview’s inquiries. Two of the four interroga-

tories in question were answered to the expressed satisfac-

A-49

tion of Broadview’s attorney. The same attorney suggested

that rulings on the other two be deferred. His failure there-

after to revive the matter, reflecting its essential triviaiity,

can scarcely ground a claim of error by the District Judge.

III.

As one of its determinations that the decree had been

violated, the District Court found that Broadview’s new

formulations CP-1 through CP-7 infringe Patent No.

3,046,262. This patent, informally labelled the “saccharin

patent” by the parties, is sufficiently indentified for present

purposes by (1) its provision for inclusion of a sulfimide

(e.g., saccharin) accelerator for rapid curing and (2) its

teaching that the composition should “exclude” or be “free

from amines” in order to promte long shelf life. It is

undisputed that Broadview’s CP-1 through CP-7 contain

saccharin. It is also undisputed that they contain what

Broadview describes as a “minor amount of amines” in

the range of from 0.025 to 0.05 per cent by weight. In a

fruitless discourse on “file wrapper estoppel,” Broadview

undertakes to show that this faint trace of amines, too

slight to have any effect of any kind, avoids Loctite’s

patent.

Coming to grips with the Patent Office history, Loctite

has shown persuasively that file wrapper estoppel is not

really a relevant concept at all—that the provision for hav-

ing the composition “free from amines” was not inserted

in the requisite sense to narrow the claims “in order to

obtain the issuance of a patent by distinguishing the prior

art * * *.” Graham v. John Deere Co., 383 U. S. 1, 33

(1966); see also I. T. S. Co. v. Essex Co., 272 U. S. 429,

444 (1926); Warning Products Corp. v. Landers, Frary &

Clark, 263 F. 2d 160, 165 (2d Cir. 1959). But there is no

need for us to linger over that; even if there were in the

ba

A-50

file wrapper history some ground for arguing that the

saccharin patent may not be read upon compositions con-

taining some meaningful amount of amines, the argument

becomes a fictional abstraction when it is related to such

a tincture of pnysically insignificant amines as Broadview

has used to avoid the patent.

The patent, the file wrapper history, and the evidence

before Judge Blumenfeld all had reference to a practice

in the prior art of using amines as accelerators in the range

of 0.5 to 5.0 per cent by weight. Loctite’s ’262 patent taught

that such use of amines reduced shelf life and should, there-

fore, be avoided “when shelf life is desired.” Seizing upon

words out of context like “free from amines” or that amines

should be “excluded,” Broadview fashions its estoppel argu-

ment by merely referring to its use of a “minor amount of

amines,” ignoring the undisputed fact that this “minor

amount” is as effective as no amines at all so far as its

impact upon shelf life or anything else is concerned. But it

is old and obvious learning that a patent may not be

avoided by making “unimportant and insubstantial changes

and substitutions in the patent which, though adding noth-

ing,” are then put forth as answers to infringement charges.

Graver Tank & Mfg. Co., Inc. v. Linde Air Products Co.,

339 U. S. 605, 607 (1950) ; see also Bewal, Inc. v. Minnesota

Mining and Manufacturing Co., 292 F.2d 159, 165-67 (10th

Cir. 1961). That essential principle applies here, as else-

where. The patent field is not the only one where due en-

forcement of the law requires penetrating to the substance

behind “sophisticated as well as simple-minded” devices.

Lane v. Wilson, 307 U. S. 268, 275 (1939).

IV.

The remaining point, the one on which we sustain Broad-

view’s appeal, is this: Broadview’s new formulations CP-8

A-51

and CP-9 are identical, respectively, with its former Nos.

I and XXIX. The latter two, it will be recalled, were the

only ones of the total of 32 omitted when Loctite was asked

in interrogatories to state which of Broadview’s composi-

tions it accused. Accordingly, when the parties came to

stipulate the facts, 30 formulations (II through XXVIII

and XXX through XXXII) were listed as those “charged

to infringe” and “therefore” as being “in issue.” Similarly,

the same 30 formulations were described in the settlement

agreement as being the ones “referred to in the Consent

Decree (Exhibit 1).” The single reference in the consent

decree to which that description had to relate was para-

graph 3, which said:

That Plaintiff has infringed said United States

Letters Patent Nos. 2,895,950; 3,048,820 and 3,046,262

by the manufacture and sale of products made under

formulations covered by said Letters Patent * * *.

Against that background, Broadview urged in the Dis-

trict Court (and here) that Loctite was “estopped” to claim

contempt with respect to CP-8 and CP-9, the current repli-

cas of if and XXIX. Rejecting that thesis, Judge Blumen-

feld observed that he could not “either expand or contract

the decree,” and went on to note, correctly, that “[n]either

the consent decree nor the settlement agreement specifically

stated that any of Broadview’s formulations were non-

infringing.” CP-8 and CP-9, he found, while identical to I

and XXIX, were “substantially the same” as former No.

IX, which had been accused by Loctite in the proceedings

before the decree as an infringement of Patent No. 3,043,820.

Moreover, he found, the “differences” between CP-8 and

CP-9 (or I and XX{X), on the one hand, and IV, on the

other, “are not significant.” Accordingly, he concluded,

CP-8 and CP-9 infringe because IV, substanitally the same,

was “admittedly infringing.”

:

a

Re Pere ee

A-52

Like Judge Blumenfeld, we find unhelpful Broadview’s

claim of an estoppel affecting this subject. We conclude,

however, that CP-8 and CP-9 may not be held to infringe—-

and may not, therefore, supply part of the basis for a con-

tempt order. We rest this conclusion upon what we believe

to be a more accurate and persuasive reading of the consent

decree, in its context, than that urged by Loctite.

In he dealings leading to the consent decree the parties

had Broadview’s 32 formulations clearly, explicitly, and

steadily before them. Loctite reviewed all of these, and then

stated specifically which of the patents (one or more) were

claimed to be infringed by each one. It made no claim under

any patent against either I or XXIX. The charges against

the other 30 were then stipulated as defining the contro-

versy—as identifying the products “which therefore [were]

in issue * * *.” ““hen the consent decree, building upon

this framework, resolved the issues by adjudging that the

30 specified formulations were infringements.

It is true there was no recital that Nos. I and XXIX were

“non-infringing.” Nor was it said expressly that they

were “not in issue.” But the omission of these two formulas

had the unmistakable effect of dropping available “issues”

and excluding obviously available “differences” from those

the consent decree was designed to settle. Such striking

omissions, in a setting like this, amount to the plainest kind

of tacit understanding that the two items not included were

distinguished deliberately and meaningfully.

Loctite’s contrary view is not supported, but is impaired,

by the finding that CP-8, CP-9 and IV (admitted to infringe)

“are substantially the same and their differences are not

significant.” The same, by definition, had to be true of I,

XXIX, and IV when the first two were omitted, and the last

one included, in the consent decree. That narrow distinc-

tion has every appearance, therefore, of a purposeful and

%

A-53

bargained result rather than an oversight. In these cir-

cumstances, we cannot read the consent decree as if it in-

cluded what it omitted—which is, of course, the result of

the interpretation pressed by Loctite.

The order of the District Court is affirmed, except for the

finding of contempt with respect to CP-8 and CP-9, which

is reversed. The case is remanded for further proceedings

consistent with this opinion.

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BRIEF IN OPPOSI -

TION TO PETITION

FOR A WRIT OF

- CERTIORARI |

*“UPREME COURT ') « APR 7 1969

P——<JORN T. BAVTS, CLERK

IN THE

Supreme Court of the United States

OcTOBER TERM, 1968

No. 1151

BROADVIEW CHEMICAL CORPORATION, Petitioner,

Vv.

LoctitE CoRPORATION, Respondent.

Brief of Respondent in Opposition to Petition for Writ

of Certiorari to the United States Court of Appeals

for the Second Circuit

Watrtser D. AMES

Rosert J. LASKER

Watson, CoLE, GRINDLE

& Watson

815 Fifteenth Street, N.W.

Washington, D. C. 20005

Attorneys for Respondent,

Loctite Corporation

Of Counsel:

J. Ropngey Reox

W. Ropert Hartigan

Passes or Braon S. ADaMs Panrrme, Dvc., Wasamreron, D. C,

Ss,

a ae

SUBJECT INDEX

Comments on Statement of the Case ...........0085.

The Petitioner’s Reasons for Granting the Writ Are

EE oa o46cnsbd oven enue ubat ends sswenses

A. The Decision Appealed From Did Not Find

Petitioner in Contempt by Manufacture or Sale

of a Composition Deliberately Excluded From a

Settlement Agreement ........... 00 eee ee ees

B. The Alleged Conflict of Circuits Is Impertinent

and Irrelevant to the Court of Appeals Deci-

sion; Further, There Is No Such Conflict ....

SSE CEE PEE ELE PECTS TE CTT OTT EE

TABLE OF CASES

Chemical Cleaning, Inc. v. The Dow Chemical Com-

pany, 379 F. 2d 294 (5th Cir. 1967), cert. denied

SBO U. BS. 1040 (19GB) ..... cc ececsccccccceseces 4

Ransburg Electro-Coating Corp. v. Ionic Electrostatic |

Corporation, 395 F. 2d 92 (4th Cir. 1968), cert.

dented, —— U. S. —— (1968) . ...csccscccveces 4 ,

Scott Paper Co. v. Marcalus Mfg. Vo., 326 U. S. 249

ie ive catuesnanven 5

Westinghouse Electric € Mfg. Co. v. Formica Insula-

tion Co., 266 U. S. S42 (1924) 2... cc ccccccesvcces 5

Rules of the Supreme Court of the United States |

DEED bd 6c UveRbhaeenebnrtsesensbseneeseseees 3

IN THE

Supreme Court of the United States

OcTOBER TERM, 1968

No.

BROADVIEW CHEMICAL CORPORATION, Petitioner,

Vv.

LOCTITE CORPORATION, Respondent.

BRIEF OF RESPONDENT IN OPPOSITION TO

PETITION FOR WRIT OF CERTIORARI

Respondent, Loctite Corporation, files this brief in

opposition to a petition by Broadview Chemical Cor-

poration that this Court review a judgment of the

United States Court of Appeals for the Second Cir-

cuit entered in the above-entitled cause on January

23, 1969.

ot St APD

2

COMMENTS ON STATEMENT OF THE CASE

Petitioner commences its Statement of the Case with

several remarks apparently calculated to prejudice

this Court against respondent. It says that petitioner

is respondent’s ‘‘only significant competitor’’ and that

respondent ‘‘has refused to license these patents, pre-

ferring to use them to maintain an exclusive position

in the industry.’’ (Petition, page 3) Of course, peti-

tioner cites nothing in the record to support these

statements, and properly so. There is no such record

and the statements are in error. There are many other

errors in petitioner’s brief and appendix, e.g., a mis-

citation and misidentification of two witnesses in the

District Court decision, but as they do not appear to

go to the essence of the petition, respondent will not

correct them all. _

It should be noted, however, that petitioner was held

in contempt of Court on four separate bases, one of

which involved infringement of United States Patent

No. 3,046,262 and another, resale of admittedly infring-

ing compositions. Petitioner casually dismisses, in a

footnote to page 5 of its petition, the fact that it has

been held in contempt on these bases. Yet, it has not

sought redress from this Court that either holding was

in error. Consequently, petitioner comes before the

Supreme Court of the United States by its own ad-

mission twice in contempt of a decree of the U. S.

District Court for the District of Connecticut. Now

it asks this Court to overrule findings with respect to

complex fact situations to which two courts have al-

ready expended considerable time and effort. As such,

it seeks relief beyond the stated and indeed practicable

scope of review by this Court.

3

THE PETITIONER’S REASONS FOR GRANTING THE WRIT

ARE INSUFFICIENT

A. The decision appealed from did not find petitioner in con-

tempt by manufacture or sale of a composition deliberately

excluded from a settlement agreement.

In support of the first basis for granting the writ,

petitioner urges that the two lower courts committed

‘‘reversible error’? (Question 1) in failing to find an

estoppel against respondent. This is a question of fact,

which is unworthy of review and falls outside the

scope of Considerations Governing Review on Certio-

rari, Rule 19 of the Rules of the Supreme Court of

the United States. Both the U. S. Court of Appeals

for the Second Circuit and U. S. District Court for

the District of Connecticut found that, as a matter of

fact, respondent was not estopped to allege that peti-

tioner was in contempt of a decree of the District Court

by its manufacture and sale of certain formulations

identified by petitioner as CP-1 to CP-9, inclusive. As

the Court of Appeals said in commenting on the Dis-

trict Court’s decision (Appendix, page A-52) :

‘“‘Like Judge Blumenfeld, we find unhelpful

Broadview’s claim of an estoppel affecting this

subject.”’

The fact situation upon which the two lower courts

found lack of estoppel is quite complex. An example

of such complexity is found in the table entitled, Sum-

mary of Broadview’s Formulations, errors in which

as originally filed caused -petitioner to file a substitute

petition. Regardless of the inherent merits of the

doctrine of estoppel, both the District Court and the

Court of Appeals found that the record did not support

application of the doctrine. Any detailed review of

the factual record would constitute usurpation of this

erat MO

é

4

Court’s time for matters not worthy of certiorari and

decided correctly by the lower courts.

Two products, CP-8 and CP-9, identical to original

formulations I and XXIX that were not originally

charged with infringement, were not held subject to

contempt. Thus petitioner was granted the relief it

seeks on pp. 9 and 10 of its petition. Only products

originally charged with infringement have subjected

respondent to contempt of court.

B. The alleged conflict of circuits is impertinent and irrelevant

to the Court of Appeals decision: further, there is no such

conflict.

Petitioner alleges a conflict of circuits between the

decisions in Chemical Cleaning, Inc. v. The Dow Chemi-

cal Company, 379 F.2d 294 (Sth Cir. 1967), cert. denied

389 U.S. 1040 (1968) and Ransburg Electro-Coating

Corp. v. Ionic Electrostatic Corporation, 395 F.2d

92 (4th Cir. 1968), cert. denied —- U.S. — (1968).

In this manner it hopes to bring its petition within

the scope of Considerations Governing Review of Cer-

tiorari set forth in Rule 19 of this Court. In so doing,

it overlooks the fact that, even if such a conflict did

exist, resolution thereof by this Court would not alter

the outcome of the decision of the Court of Appeals.

Tn the decision of that Court (A-42 to A-53), the Court

of Appeals did not mention either of the two allegedly

conflicting cases. It never reached the law of those

cases because it found that the District Judge had

never restricted petitioner’s inquiries into the prior

art. As the Court of Appea’s said, referring to the

colloquies reprinted at A-19 and A-27:

‘“‘Two of the four interrogatories were answered

to the expressed satisfaction of Broadview’s at-

SER OT A et Sen a Ant ls CR Na 8a ME ta in eae Mie eed Ma Bae Sia ARR: i Sieks diab tit

WwW

torney. The same attorney suggested that rulings

on the other two be deferred. His failure there-

after to revive the matter, reflecting its essential

triviality, can scarcely ground a claim of error by

the District Judge.’’ (A-48, 49)

Before the alleged conflict of circuits can affect the

present litigation, it must first be found, contrary to the

finding of the Court of Appeals, that the District Court

improperly limited the discovery of petitioner’s

counsel. Such factual review is not believed consistent

with the bases on which this Court grants certiorari.

Further, there is no conflict between circuits here,

as evidenced from the fact that this Court denied cer-

tiorari in both of the allegedly conflicting decisions.

While these decisions could be reviewed at length, it

will suffice to state that Ransburg required an interpre-

tation of injunctive language not found in claims of

the infringed patents; in Dow the injunction was

written in terms of the claims which had already been

scrutinized by the parties in the original action. Both

these cases dealt with the applicability of prior art at

a contempt proceeding. Furthermore, the doctrine of

Scott Paper Co. v. Marcalus Mfg. Co., 326 U.S. 249

(1945) and Westinghouse Electric & Mfg. Co. v. For-

mica Insulation Co., 266 U.S. 342 (1924) which did

not deal with contempt proceedings, was not violated.

As recited above, however, the District Court here

never precluded petitioner from introducing evidence

of the state of the prior art. This is a factual basis of

the decisions of both lower courts.

f

3

§

q

6

CONCLUSION

The petition for a writ of certiorari should *e denied.

Respectfully submitted,

Water D. AMES

Rosert J. LASKER

Watson, CoLE, GRINDLE

& WATSON

815 Fifteenth Street, N.W.

Washington, D. C. 20005

Attorneys for Respondent,

Loctite Corporation

Of Counsel:

J. RopNEY REecx

W. Ropert HARTIGAN

March 31, 1969