# Petition for Writ of Certiorari — Manildra Milling Corp. v. OMI Holdings, Inc. > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386005_1651%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition for Writ of Certiorari - **Published:** January 1, 1994 - **Citation:** 510 U.S. 1164 ## Text 99 io Q "4 3 | gs -, _ 7 PFC 20 3993 No. 93- ‘a v In The SUPREME COURT OF THE UNITED STATES October Term, 1993 MANILDRA MILLING CORPORATION, Petitioner, v. OMI HOLDINGS, INC., Respondent. ON PETITION FOR WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT PETITION FOR WRIT OF CERTIORARI Murray J. Belman 700 14th Street, N.W. Washington, D.C. 20005 (202) 508-1000 Counsel of Record Of Counsel: W. Stanley Walch Mark S. Sableman Roman P. Wuller Halpin J. Burke 700 14th Street, N.W. Washington, D.C. 20005 (202) 508-1000 December 20, 1993 i QUESTION PRESENTED Whether the Court of Appeals for the Federal Circuit is unconstitutionally depriving parties of the right to trial by jury by reversing, in whole or in part, forty-two percent (42%) of the jury verdicts in patent cases that it has reviewed since 1987 under the substantial evidence test, and, in particular, by sua sponte reversing a $4.75 million jury verdict for damages, reached after five months of trial and six weeks of jury deliberation, on a purely factual issue unrelated to any matters of patent law, that the respondent did not even contest at trial or on appeal. ii LIST OF PARTIES The parties to the proceedings in the trial court, the U.S. District Court for the District of Kansas, were the petitioner, Manildra Milling Corporation ("Manildra"); the owner of Manildra’s parent company, John Thomas Honan ("Honan"); the predecessor of the respondent OMI Holdings, Inc. ("OMI"), Ogilvie Mills, Inc.("Ogilvie"); and Henkel Corporation and Henkel of America, Inc. (together, "Henkel"). Before trial, Manildra entered into an agreement with Henkel settling all claims. After trial, OMI succeeded to Ogilvie’s interest in the proceedings. The parties in the Court of Appeals for the Federal Circuit were the petitioner, Manildra; the respondent, OMI; and Honan. Honan has been dropped from the parties in this petition because he is not an adverse party, he prevailed in the proceedings at the trial and appellate level, and is not subject to the portion of the Court of Appeals decision that is the subject of this petition for certiorari. RULE 29.1 LIST OF PARENT COMPANIES Manildra Milling Corporation is a wholly owned subsidiary of Honan Holdings, USA, Inc. It has no subsidiaries to list pursuant to Rule 29.1. QUESTION PRESENTED ee ee ee a ee RULE 29.1 LIST OF PARENT COMPANIES . TABLE OF CONTENTS ...-----essscccttte TABLE OF AUTHORITIES ....------sssccctc? tk 0 a STATEMENT OF JURISDICTION . | Seer e ee ee CONSTITUTIONAL PROVISION INVOLVED ......-- STATEMENT OF THECASE ....------ sss? ARGUMENT I. II. il. A. B. ©. IV. The Court of pemere tor the Sete Circuit Hes Become Notorious for Improper Fact- Finding This Case Represents a Most Egregious Case of Imprcper Fact Finding at the Appellate Level The Federal Circuit Improperly Made Factual Determinations Contrary to the Findings of the Jury and the Position of the Parties .....---- The Legal Standard for Establishing Facts on SESS ee There Was Substantial Evidence to Support a Finding By a Reasonable Jury that Ogilvie Told Customers that Manildra Was Snirinmins ow errr 1. Statements to Purchaser Moore Paper 2. The Hancock Evidence ......----- Given Ogilvie’s Admission, the Federal Circuit Should Not Have Examined the Sufficiency of Evidence on this Issue... - . i i a il iV B RITI Amstar Corporation v. Envirotech Corporation et al., 730 F.2d 1476 (Fed. Cir.), cert. denied, 469 U.S. Se I a ola asa ea a a ee a 6k do 9, 10 Ashland Oil, Inc. v. Delta Resins & Refractories, 776 F.2d 281 (Fed. Cir.), cert. denied, 475 U.S. ee EG oe se a ee ca ae tse kek ees 9 Baginsky v. United States, 697 F.2d 1070 (Fed. Cir.), cert—denied, 464 U.S. 981 (1983) ...........2 cc eee 10 Biodex Corp. v. Loredan Biomedical, Inc., 946 oF i | ee | ae ee rear rae 22 Cone v. West Va. Pulp & P. Co., 330 U.S. 212 (1947) .... 22 Dennison Manufacturing Co. v. Panduit Corp., Coe as 6 6 bo eho OS eb wes 10, 11, 12, 13, 14 EWP Corp. et al. v. Reliance Universal Inc. et al., 755 F.2d 898 (Fed. Cir.), cert. denied, 474 U.S. ee ae a ae a es & oi oe ob ee 9, 10 Gallick v. B&O, 372 U.S. 108 (1963) ............... 15 J.P. Stevens & Co., Inc. v. Lex Tex Litd., Inc., 747 F.2d 1553 (Fed. Cir. 1984), cert. denied, el ae I os oe ae aa be ee 08 4% 8 9 Jones et al. v. Hardy, 727 F.2d 1524 (Fed. Cir. 1984) ... 9, 10 King Instrument Corp. v. Otari Corp., 767 F.2d 853 (Fed. Cir. 1985), cert. denied, 475 U.S. 1016 (1986) ...... 9 Lavender v. Kurn, 327 U.S. 645 (1946) .............. 15 Malta v. Schulmerich Carillons, Inc., 952 F.2d 1320 ee ae Es es ee ea Pe ee tae ee ae ee 12, 14 Vv Page Panduit Corp. v. Dennison Mfg. Co., 774 F.2d 1082 (Fed. Cir.), cert. granted and judgment vacated by, 475 U.S. 809 (1985), on remand, 810 F.2d 1561, cert. denied, 481 U.S. 1052 (1987) ............ 9, 11, 12 Raytheon Company v. Roper Corporation, 7124 F.2d 951 (Fed. Cir. 1983), cert. denied, ip eo), | rere se ee ee 9, 10 RCA Corp. v. Applied Digital Data Systems, Inc., 730 F.2d 1440 (Fed. Cir.) (Kashiwa, J., dissenting), cert. dismissed, 468 U.S. 1228 (1984) ...........-.. 9, 10 Rogers v. MoPac, 352 U.S. 500 (1956) ....-.--.-+---- 15 Rohm & Haas Company v. Crystal Chemical Company, et al., 722 F.2d 1556 (Fed. Cir. 1983), cert. denied, 469 U.S. 851 (1984)... ......555555. 9, 10 Rol Mfg. Co. v. Nickson Industries, Inc., 765 F.2d 160 (Fed. Cir.), cert. denied 474 U.S.843 (1985) ........ 9 Schulz v. Penn. R., 350 U.S. 523 (1956) ............-. 15 Senmed Inc. v. Richard-Allen Medical Indus., Ph BLE)! Se | ar re 12 Simmons Fastener Corp. v. Illinois Tool Works, 739 F.2d 1573 (Fed. Cir. 1984), cert. denied, 671 US. WRB CIID) ccc ccc cee te sees 9, 10 Stratoflex, Inc. v. Aeroquip Corp., 713 F.2d 1530 ek, Gis, TU kgs ck 6 0 6 oo 8s eae eer ep es 9, 10 Taylor v. Mississippi, 319 U.S. 583 (1943) ......--.-.. 16 Tennant v. Peoria, 321 U.S. 29 (1944)...........5..-. 15 TP Laboratories, Inc. v. Professional Positioners, Inc. et al., 724 F.2d 965 (Fed. Cir.), cert. denied, fis YF) wo ere er a ee ee 9, 10 Uniroyal, Inc. v. Rudkin-Wiley Corp., 837 F.2d 1044 (Fed. Cir. 1988), cert. denied, 488 U.S.825 ....... 12 vi Page W.L. Gore & Associates, Inc. v. Garlock, Inc., Tal F.2e 1568 Gad. Ci. BOGE) cc cc ccc cee ce ccs 9, 10 Walters v. City of Atlanta, 803 F.2d 1135 Se, aks 6 Sai iG Gna ate wis oF ete kn mene 22 Woods v. Tsuchiya, 754 F.2d 1571 (Fed. Cir.), cert. denied, 474 U.S. 825 (1984) ................ 9, 10 Statutes Es FM & |) eR EN ire eet gpa our se Gar 2 Rs PED goo c 0 4h 6 4 Oo eee 2 PC a a EE sg sa 06g OR RS ae We ee ee 2 Federal! Rule of Civil Procedure 52(a) ......... 8,9, 10, 11 her A riti Fourth Annual Judicial Conference of the United States Court of Appeals for the Federal Circuit, See ee See CD Ss obo 8 eee eee eke kee 8,9 Ninth Annual Judicial Conference of the Federal Cram, 160 F.R.D. 37 (lay DS, ISBT) ww cece 11 Note, Nothing Seems "Obvious" to the Court of Appeals for the Federal Circuit: The Federal Circuit, Unchecked by the Supreme Court, Transforms the Standard of Obviousness Under the Patent Law, 26 Loyola of L.A. Law Rev. 455, 481 (1993) .......... 13 The Federal Circuit: A Case Study in Specialized Courts, 64 N.Y.U. L. Rev. 1, 61-61 (1989) ........... 11 U.S. Constitution Amendment VII ................. y SE In The SUPREME COURT OF THE UNITED STATES October Term, 1993 MANILDRA MILLING CORPORATION, Petitioner, v. OMI HOLDINGS, INC., Respondent. ON PETITION FOR WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT PETITION FOR WRIT OF CERTIORARI The petitioner Manildra Milling Corp. respectfully prays that a writ of certiorari issue to review the judgment and opinion of the United States Court of Appeals for the Federal Circuit, entered in the proceeding entitled Manildra Milling Corporation v. Ogilvie Mills, Inc. v. Henkel Corporation and Henkel of America, Inc., v. John Thomas Honan on June 22, 1993. OPINIONS BELOW The opinion of the United States Court of Appeais for the Federal Circuit is not reported. It is reprinted in the appendix hereto, p. la. The memorandum and order of the United States District Court 2 fF for the District of Kansas (Saffels, J.) is reported at 797 F.Supp. 874. It is reprinted in the appendix hereto, p. 27a. STATEMENT OF JURISDICTION The judgment of the United States Court of Appeals for the Federal Circuit was entered on June 22, 1993 (p. la), reversing the judgment of the trial court dated June 16, 1992 (p. 27a) in petitioner's favor on the Lanham Act and Kansas unfair competition laws. The Court of Appeals denied a timely petition for rehearing on September 20, 1993 (p. 25a). The jurisdiction of this Court is invoked under 28 U.S.C. § 1254(1). CONSTITUTIONAL PROVISION INVOLVED U.S. Constitution Amendment VII In Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury, shall be otherwise reexamined in any Court of the United States, than according to the rules of the common law. STATEMENT OF THE CASE This proceeding was commenced pursuant to 28 U.S.C. §§ 1331 and 1338 in the United States District Court for the District of Kansas, on a complaint for declaratory relief and damages by Manildra Milling Corporation ("Manildra"). The complaint named Ogilvie Mills, Inc. ("Ogilvie") as defendant and alleged that Ogilvie’s patents (Nos. 3,901,725 and 4,280,718) were invalid and were not infringed by Manildra. The complaint also alleged violations of the Sherman Act, the Lanham Act and Kansas unfair ee © 3 competition laws covering intentional interference with prospective economic advantage and injurious falsehood ("Kansas unfair competition law"). Ogilvie denied Manildra’s claims and counterclaimed for patent infringement. On August 26, 1991, trial began before a jury of nine. More than fifty witnesses testified and the parties introduced almost 1,000 exhibits. After almost five months of trial, the case was submitted to the jury on January 16, 1992. The jury deliberated for six weeks, finding that Ogilvie’s patents were invalid and not infringed by Manildra and that Ogilvie had violated the Lanham Act and Kansas _ unfair competition law. The jury awarded Manildra $2,250,000 in compensatory and $2,500,000 in Punitive damages. The Basis of the Jury's Verdicts The linchpin of the Lanham Act and unfair competition verdicts was the jury’s finding, on a "clear and convincing evidence" instruction,' that Ogilvie asserted its patent rights to convince the five potential customers for the accused Product not to buy from Manildra wher it knew, or should have known, that its patents were either invalid or not infringed.’ ' The district court gave the jurors written instructions, which they were allowed to have with them during their deliberations Instruction 24 called for the jury to determine. on a clear and convincing evidence standard, whether — Ogilvie asserted its patent mghts when it knew. or should have known, that its patents were either invalid or unen forceable, or had not been infringed by Manildra Instruction 4] required the jury to decide whethe: 4 The Basis of the Federal Circuit’s Decision This petition relates solely to the Federal Circuit's reversal of the jury’s verdicts that Ogilvie had violated the Lanham Act and the Kansas unfair competition law. The Federal Circuit reversed on the sole ground that, in its view, there was no more than a scintilla of evidence that Ogilvie ever told the potential customers that Manildra was an infringer. That decision ignored a substantial body of evidence, including (1) an admission by Ogilvie’s senior American officer that he “may have" told the customers that Manildra was infringing, (2) Ogilvie’s own sales reports that told a story of its not very subtle message to customers that an infringement suit could become "cost effective" if they did not limit their purchases from Manildra, and (3) a customer’s document flat out stating that Ogilvie accused Manildra of infringement. Indeed, Ogilvie had admitted in its post-trial motions that it had told buyers Manildra was infringing its patents, and it did not argue otherwise in its briefs or oral argument on appeal. Notwithstanding the evidence and a complete absence of dispute on the issue, the Federal Circuit panel seized on it, sua sponte. At oral argument, Judge Clevenger remarked: Now, I would presume with all deference, Mr West [counsel for Manildra}, that if you had a ton of customers Ogilvie published a statement, and such statement was reasonably understood by those who heard it to cast doubt on the legal status of Manildra’s [product]. The jury found that these conditions (as well as others requiring false and misleading representations and malice) existed. 5 that had been subjected to a litany’ and if the litany indeed involved threatening -- Saying, "Listen here, Manildra’s product infringes our patent," you wouldn’t have had any trouble putting those people on the stand. There is only one reference to infringement uh, just a second, I mean you've got your staff over there maybe they can start looking but until somebody can demonstrate to me to the contrary, I think that you don’t even have a scintilla of evidence supporting a falsehood. Thus began the journey of the Federal Circuit, first to set its own standard of what proof should have been available (without any background whatsoever about the industry, traditional relationships between suppliers and customers or other factors that could lead a jury to reach a different conclusion about what evidence ought to be available) and then to make its own appraisal of the evidence that was presented at trial. This process resulted in the court’s conclusion that: [A]fter examining the entire record on appeal, we have discovered only one document, referred to as [Ex.] 715, out of several thousand trial exhibits, that provides some evidence that Ogilvie without qualification stated that Manildra was infringing its patents. Moreover, this single document is not a direct communication between Ogilvie * The evidence showed that Prior to the time Ogilvie purchased the patents and the business that produced the product from Henkel of America, Inc., Henkel’s general manager and chief salesman had developed what they called a "litany" about Henkel’s patent rights including the claim that Manildra was an infringer. When Ogilvie purchased the business and patents, it hired the same general manager, chief salesman and other senior employees. Thereafter, Ogilvie’s written sales call reports indicate that they repeated the “litany” to potential buyers of Manildra's accused product. Since there are only five users of the product in the U. S., this was an exceptionally easy market to communicate with. 6 and one of its customers, but rather is an internal customer memorandum between two of the customer’s employees regarding future * * * purchases and a future expansion of business. [Federal Circuit Opinion at p. 17a-18a] The court found that Exhibit 715 (p. 94a) constituted a "mere scintilla” of evidence and overturned the jury’s verdict.‘ In reaching its conclusion, the court perforce concluded: No reasonable juror could credit a customer’s internal memorandum reporting that Ogilvie had charged Manildra with infringement. See p. 16 below. No reasonable juror could construe as an admission the statement by Ogilvie’s chief operating that he "may have" told customers that Manildra was infringing. See p. 16 below. No reasonable juror could conclude that, when Ogilvie told a customer that a suit for patent infringement would not be “cost effective" so long as Manildra’s sales were limited, it was threatening infringement litigation if those sales increased. See p. 17 below. No reasonable juror could equate Ogilvie’s claim that, because of the patents, Manildra was not a "legitimate * The Federal Circuit never explained why this document was, in its opinion, a “mere scintilla” other than noting it was an internal customer memorandum. Its opinion seems to confuse quantity with quality. Even if the Federal Circuit was right that there was only one document out of several thousand exhibits on point, it does not logically follow that a single document is a “mere scintilla." Indeed, Ex. 715 is particularly credible, since it was sent by a purchaser to his superior and documented the customer’s decision to limit purchases from Manildra because of Ogilvie’s threat to embroil the customer in patent infringement litigation. A fact finder might reasonably have seen the document as a “smoking gun” rather than a “scintilla” of evidence. Jevtid aaah : 7 competitive situation” to a charge of patent infringement. See p. 17 below. -- No reasonable juror could conclude that Ogilvie’s "litany" to its customers, which admittedly related to its purchase of the patents and their violation by Manildra, was tantamount to a charge of infringement. See p. 18 below. To recite these conclusions of fact that were essential to the Federal Circuit’s decision is to demonstrate how improper that decision was. It was plain and even arrogant error to hold that no reasonable juror, exposed to this array of evidence during five months of trial and six weeks of deliberation, could have found as they did. This is not an isolated instance of over! y aggressive fact-finding by the Federal Circuit, a practice that has once before earned it summary reversal by this Court and has not abated since then. But this may be the most egregious example of a practice that, at bottom, denies litigants their Seventh Amendment rights to a jury trial, This Court should act again, by summary procedure, to correct the Federal Circuit’s mistaken practice. ARGUMENT I. The Court of Appeals for the Federal Circuit Has Become Notorious for Improper Fact-Finding {t is a cardinal rule of appellate review that courts of appeals must give a high degree of deference to determinations of fact at the trial level, particularly those by a jury. Unwarranted fact-finding at the appellate level is particularly corrosive to the judicial process. The spectacle of appellate panels -- who have not heard the evidence and cannot, on a sterile written record, make a careful and balanced 8 evaluation of what and whom to believe -- second-guessing fact- finders at trial can only undermine public confidence in the litigation process and the protections of the Seventh Amendment. It is physically impossible for this Court routinely to oversee whether inferior courts give proper deference to this crucial limitation on appellate review. Consequently, our system requires self-policing by the courts of appeal. Most have carried out this duty responsibly; unfortunately, the Federal Circuit has not. Indeed, it has become notorious for engaging in improper fact- finding. Thus, the principal speaker at the Court’s Fourth Judicial Conference could bluntly state: The charge that the court makes de novo fact finding is demonstrably true. I don’t believe that there is a judge on the court that would deny it. That fact induces lawyers to disregard Rule 52(a) and to reargue facts that they shouldn’t really be rearguing before the appellate court. Fourth Annual Judicial Conference of the United States Court of Appeals for the Federal Circuit, 112 F.R.D. 439, 542 (1987) (Statement of Thomas Arnold). The court’s chief and two other judges were members of the same panel of speakers; none challenged the assertion. The issue was of such moment that a “mini-debate” on the subject, "Resolved: The Federal Circuit Has Improperly Assumed the Role of Fact Finder * * *" was held as part of the proceedings.* Id. at 609-619. The speaker supporting 5 The debate was focused on the requirements of FRCP 52(a), which concerns the review of fact-finding by a trial judge under the “clearly erroneous” standard, rather than the stricter substantial evidence test employed in the review of jury verdicts. Nonetheless, the speaker supporting the affirmative of the debate stated: ae ey 9 the affirmative position was able to cite nine Federal Circuit cases raising the issue,° seven more where an abuse of Rule 52(a) was alleged,’ three additional cases where the contention was made by All I know is that there are a significant number of cases, there are a significant number of patent trial bar, who are of the firm conviction that the court has engaged in excessive fact finding. 112 F.R.D. at 611. * Simmons Fastener Corp. v. Illinois Tool Works, 739 F.2d 1573 (Fed. Cir. 1984), cert. denied, 471 U.S. 1065 (1985); Amstar Corporation v. Envirotech Corporation et al., 730 F.2d 1476 (Fed. Cir.), cert. denied, 469 U.S. 924 (1984); RCA Corp. v. Applied Digital Data Systems, Inc., 730 F.2d 1440 (Fed. Cir.) (Kashiwa, J., dissenting), cert. dismissed, 468 U.S. 1228 (1984); Jones et al. v. Hardy, 727 F.2d 1524 (Fed. Cir. 1984) (Kashiwa, J., dissenting in part); TP Laboratories, Inc. v. Professional Positioners, Inc. et al., 724 F.2d 965 (Fed. Cir.), cert. denied, 469 U.S. 826 (1984); Raytheon Company v. Roper Corporation, 724 F.2d 951 (Fed. Cir. 1983), cert. denied, 469 U.S. 835 (1984); Rohm & Haas Company v. Crystal Chemical Company, et al., 722 F.2d 1556 (Fed. Cir. 1983), cert. denied, 469 U.S. 851 (1984); W.L. Gore & Associates, Inc. v. Garlock, Inc., 721 F.2d 1540 (Fed. Cir. 1983) (Davis, J., concurring in the result in part and dissenting in part), cert. denied, 469 U.S. 851 (1984); Stratoflex, Inc. v. Aeroquip Corp., 713 F.2d 1530 (Fed. Cir. 1983). ” J.P. Stevens & Co., Inc. v. Lex Tex Lid., Inc., 747 F.2d 1553 (Fed. Cir. 1984), cert. denied, 474 U.S. 822 (1985); Woods v. Tsuchiya, 754 F.2d 1571 (Fed. Cir.), cert. denied, 474 U.S. 825 (1984); EWP Corp. et al. v. Reliance Universal Inc. et al., 755 F.2d 898 (Fed. Cir.), cert. denied, 474 U.S. 843 (1985); Rol Mfg. Co. v. Nickson Industries, Inc., 765 F.2d 160 (Fed. Cir.), cert. denied 474 U.S.843 (1985); King Instrument Corp. v. Otari Corp., 767 F.2d 853 (Fed. Cir. 1985), cert. denied, 475 U.S. 1016 (1986); Ashland Oil, Inc. v. Delta Resins & Refractories, 776 F.2d 281 (Fed. Cir.), cert. denied, 475 U.S. 1017 (1985); Panduit Corp. v. Dennison Mfg. Co., 774 F.2d 1082 (Fed. Cir.), cert. granted and judgment vacated by, 475 U.S. 809 (1985), on remand, 810 F.2d 1561, cert. denied, 481 U.S. 1052 (1987). 10 the dissent,* and eleven in which he concluded that the court had gone too far.’ That the Federal Circuit’s own Conference would have devoted so much time to this issue demonstrates its immediacy and importance. That members of the patent bar participating in the Conference would have spoken so candidly in criticism of the court (before the very judges who hear their appeals) demonstrates their high frustration with the court’s practice. The Fourth Conference took place only a day after this Court announced its per curiam decision in Dennison Manufacturing Co. v. Panduit Corp., 475 U.S. 809 (1986). Panduit vacated a judgment of the Federal Circuit in which it had disregarded factual determinations of the trial judge relating to the issue of obviousness. The Court observed that, whether the ultimate question of obviousness is one of fact or law, the subsidiary determinations of the district court should be subject to the cle*ly erroneous standard of Federal Rule of Civil Procedure 52(a, “cause the Federal Circuit had engaged in fact finding without se much as a mention * Woods v. Tsuchiya, 754 F.2d 1571, 1582 (Fed. Cir. 1985); RCA Corp. v. Applied Digital Data Systems, Inc., 730 F.2d 1440, 1448 (Fed. Cir. 1984); Jones et al. v. Hardy, 727 F.2d at 1534; see also Baginsky v. United States, 697 F.2d 1070, 1077 (Fed. Cir.), cert. denied, 464 U.S. 981 (1983). % Stratoflex, Inc. v. Aeroquip Corp., supra, 713 F.2d 1530; W.L. Gore & Associates, Inc. v. Garlock Inc., supra, 721 F.2d 1540; Rohm & Haas Co. v. Crystal Chemical Co., supra, 722 F.2d 1556; Raytheon Company v. Roper Corporation, supra, 724 F.2d 951; TP Laboratories, Inc. v. Professional Positioners, Inc. et al., supra, 724 F.2d 965; RCA Corp. v. Applied Digital Data Systems, Inc., supra, 730 F.2d 1440; Jones et al. v. Hardy, supra, 727 F.2d 1524; Amstar Corp. v. Envirotech Corp. et al., supra, 730 F.2d 1476; Simmons Fastener Corp. v. Illinois Tool Works, supra, 739 F.2d 1573; EWP Corp. etal. v. Reliance Universal Inc. et al., supra, 755 F.2d 898; Woods v. Tsuchiya, supra, 754 F.2d 1571. 11 of Rule 52 or its standard of review, the Court remanded for further consideration in light of that rule.'° Panduit should have sensitized the Federal Circuit to cis Court’s concern about appellate fact finding, but it did not. Since January 1, 1988, the Federal Circuit has reviewed jury verdicts in approximately 38 cases involving patents. Of those, the court reversed the juries’ findings, in whole or in part, at least 16 times, an astonishing 42% rate."' At the Ninth Annual Judicial Conference of the Federal Circuit, Judge Cohn of the Eastern District of Michigan observed: My reading, though, of some of the decisions of the Circuit, suggests to me, when they would prefer a different result than that reached by the trial judge, they shift from his findings of fact and say, "Oh, no. This is a conclusion of law." And, to some extent, I am constrained to say that some of the decisions that I have read from this Circuit are result driven. (Applause. ) 140 F.R.D. 57, 69 (May 9, 1991). ° On remand, the Federal Circuit did apply Rule 52(a) in a 21 page opinion dissecting each of the trial court's findings and explaining why it was clearly erroneous. Panduit Corp. v. Dennison Mfg. Co., 810 F.2d 1561 (Fed. Cir.), cert. denied, 481 US 1052 (1987). That that decision was not reviewed by this Court cannot be taken as acquiescence in improper fact-finding at the appellate level. Even those commentators who, because of the Federal Circuit's presumed expertise in the patent field, are prepared to countenance wider leeway to its fact-finding forays would do so only within the scope of that expertise. See, ¢.g., The Federal Circuit: A Case Study in Specialized Courts, 64.N.Y.U. L. Rev. 1, 61-61 (1989) '' These statistics are based on a Lexis search of patent appeals to the Federal Circuit in which the court reviewed a jury's verdict under the substantial evidence test. The cases are cited in Table I at p. 109a, which is a chart reflecting treatment of the juries’ verdicts. 12 Later the same year, Judge Newman of the Federal Circuit castigated her colleagues for fact-finding on appeal in Malta v. Schulmerich Carillons, Inc., 952 F.2d 1320, 1331-1346 (Fed. Cir. 1991): With all respect to my colleagues on this panel, their rejection of the jury verdict and de novo determination of the factual issue of infringement is contrary to the law governing appellate review of jury verdicts. Id. at 1331." She then cited 38 elements of evidence, plus extensive trial testimony, that the majority disregarded in overturning the jury's verdict of infringement. /d. at 1336-40." '? This was not the first instance after Panduit in which Judge Newman enticized her colleagues for improperly overturning a jury's verdict. In Senmed, Inc. v. Richard-Allen Medical Indus., 888 F.2d 815, 821 (Fed. Cir. 1989), she stated: This appeal is from a jury verdict of infringement, yet it is difficult to find in the majority opinion any deference to the jury, or application of the standard by which jury verdicts are reviewed on appeal. 'S Uniroyal, Inc. v. Rudkin-Wiley Corp., 837 F.2d 1044 (Fed. Cir. 1988), cert. denied, 488 U.S. 825 is another example of de novo fact-finding since Panduit. There, the court re-examined the factual determinations of the trial court in evaluating both the ultimate "fact" and the secondary considerations relating to obviousness. The trial might just as well have been before the appellate court, and the decision makes immediate the comment of one district judge: It gives me great comfort to know that I am just the first stop on this trip. Everything I have said here can be analyzed just as well by the Court of Appeals for the Federal Circuit. Quoted in Panduit Corp. v. Dennison Mfg. Co., supra, 810 F.2d at 1565. That this statement could be made by a federal district judge shows just how far the fact- finding practices of the Federal Circuit have conditioned trial courts to expect to be second-guessed on the facts. adh Pe aN 13 One recent commentator described the current situation thusly: [T]he CAFC has not only changed the Supreme Court’s standard of obviousness, but has made itself a de novo reviewer of obviousness by giving itself the authority to review all facts related to the issue of obviousness in a case. In sum, the CAFC no longer uses the clearly erroneous standard, but instead appears to review the facts regarding obviousness whenever it disagrees with the trial court. The CAFC often rolls up its sleeves and reexamines all the facts of a case related to obviousness. Note, Nothing Seems “Obvious” to the Court of Appeals for the Federal Circuit: The Federal Circuit, Unchecked by the Supreme Court, Transforms the Standard of Obviousness Under the Patent Law, 26 Loyola of L.A. Law Rev. 455, 481 (1993). The instant case shows that, far from being discouraged by this Court’s decision in Panduit, the Federal Circuit has taken fact finding at the appellate level to a new extreme. Il. This Case Represents a Most Egregious Case of Improper Fact Finding at the Appellate Level This case was presented to a jury for more than five months. Some 15,000 pages of testimony from more than fifty witnesses and almost 1,000 documents were introduced into evidence. The jury deliberated for six weeks before rendering its verdict on numerous and complex issues of patent validity, infringement and violations of the Lanham and Sherman Acts and Kansas unfair competition laws. The jury was quite discriminating in its verdicts, finding for Manildra on validity, infringement and the Lanham Act and state unfair competition claims and for Ogilvie on the Sherman Act and inequitable conduct before the Patent Office claims. 4 On appeal, the Federal Circuit overturned the verdicts under the Lanham Act and unfair competition law on the sclitary ground that there was no more than a scintilla of evidence that Ogilvie told the trade that the Manildra was guilty of infringement. Before considering the substance of that conclusion, it is important to note that the court was not considering a combined issue of fact and law related to the question of obviousness as in Panduit or the standards of evidence and argument required to show infringement by equivalence as in Malta. Here, we have a naked issue of fact not relevant to any issue of patent law. Unlike Malta, the district judge in this case endorsed the jury’s verdict in its entirety. Finally, the court’s fact-finding flies in the face of specific admissions made by the patentee in its motion for judgment as a matter of law and in other filings that it had told the customers that Manildra was infringing. Ill. The Federal Circuit Improperly Made Factual Determinations Contrary to the Findings of the Jury and The Position of the Parties. In the present case, the Federal Circuit sua sponte made a crucial finding of a specific fact that was contrary to the findings of the jury and district court who saw and heard the evidence through more than five months of trial. Ogilvie had admitted the truth of that specific fact on several occasions before the Federal Circuit made its own finding on the issue. By making this factual determination, the Federal Circuit in the fullest sense deprived Manildra of its constitutional right to a jury trial. 15 A. The Legal Standard for Establishing Facts on Appeal. The Federal Circuit’s fact-finding departed significantly from the precedent established by this Court. The “substantial evidence” standard for review of a jury’s fact-finding is very strict: Courts are not free to reweigh the evidence and set aside the jury verdict merely because the jury could have drawn different inferences or conclusions or because judges feel that other results are more reasonable. xx * It is not the function of a court to search the record for conflicting circumstantial evidence in order to take the case away from the jury that the proof gives equal support to inconsistent and uncertain inferences. The focal point of judicial review is the reasonableness of the particular inference or conclusion drawn by the jury. It is the jury, not the court, which is the fact-finding body. It weighs the contradictory evidence and inferences, judges the credibility of the witnesses, receives expert instructions, and draws the ultimate conclusion as to the facts. The very essence of its function is to select from among conflicting inferences and conclusions that which it considers most reasonable....That conclusion, whether it relates to negligence, causation or any other factual matter, cannot be ignored. Gallick v. B&O, 372 U.S. 108, 114, 115 (1963). See also, Rogers v. MoPac, 352 U.S. 500 (1956); Schulz v. Penn. R., 350 U.S. 523 (1956); Lavender v. Kurn, 327 U.S. 645 (1946); Tennant v. Peoria, 321 U.S. 29 (1944). 16 There Was Substantial Evidence to Support a Finding By a Reasonable Jury that Ogilvie Told Customers that Manildra Was Infringing Direct evidence that Ogilvie told customers that Manildra was infringing was contained in Ex. 715, as the Federal Circuit acknowledged: {A]fter examining the entire record on appeal, we have discovered only one document, referred to as [Ex.] 715, out of several thousand trial exhibits, that provides some evidence that Ogilvie without qualification stated that Manildra was infringing its patents. [Opinion, p. 17a]. In that trial exhibit, a purchasing agent for one of the three major users of the product, large particle wheat starch, stated, "Ogilvie has stated that their company holds all patent rights on use of starch in carbonless paper and Manildra infringes on this patent." That statement was perfectly consistent with the admission made at trial by Ogilvie’s vice president and general manager: Q. Q. A. You or your sales staff also have from time to time either in response to a question or On your own initiative told them that -- told certain customers that you thought Manildra was infringing those patents? If they asked the question and would bring up the subject of Manildra, we would try and answer those questions as honestly as we knew how. All right. And on those occasions, you did tell them that Manildra -- you thought Manildra was infringing the patent? I-- I may have. [Tr. 8040-1, p. 86a.] It must be assumed that the jury found that testimony credible. Taylor v. Mississippi, 319 U.S. 583, 585-86 (1943). In addition to this direct evidence that Ogilvie told the trade that Manildra was infringing, the was extensive evidence from which a reasonable 17 juror could properly infer that fact. The following sections describe some of that evidence: 1. Statements to Purchaser Moore Paper Co. In March 1985, less than two months after Ogilvie purchased the patents from the previous owner, its director of sales, Calott, met with its customer, Moore Business Forms. He told them he knew Moore was using limited quantities of Manildra’s product. Calott said that Manildra had no license, but it would not be "cost effective” to bring an infringement suit. Tr. 3714-18, pp. 61a-64a. Seven days later, Calott wrote Moore that Ogilvie had acquired “all the patents in this area,” and a third company, Midwest, was its only licensee. Ex. 684, p. 88a. The jury reason- ably interpreted that evidence to mean that Ogilvie told Moore that Manildra was an infringer but that suit would not be brought unless Moore increased Manildra’s small share and thereby made suit "cost effective.” In late January 1986, Calott reminded Moore that Midwest was the only licensee under the patents. Ex. 697, p. 89a. Two weeks later, Moore notified him that Manildra had lowered its price, and Calott responded that Manildra was not "a legitimate competitive situation.” Id. Calott testified he meant that Ogilvie’s having "a patent license makes us more legitimate." Tr. 2168, p. 59a. On hearing that news, Moore’s purchasing agent immediately faxed Calott’s earlier (March, 1985) letter regarding the patents to Moo- re’s legal department. Ex. 684, p. 88a. Moore decided at that time to restrict purchases from Manildra. Tr. 3722, p. 64a. The jury could reasonably take that evidence as showing that Ogilvie had successfully curbed Moore’s purchases from Manildra by raising the possibility of litigation if suit became "cost effective." ee 18 In August 1986, Calott met with Moore’s buyer, Keller, who again reminded him of Manildra’s much lower price. Calott made no defense of Ogilvie’s price on commercial terms, but launched immediately into Ogilvie’s “litany.” Ex. 713, p. 9la. Keller’s response (as recorded by Calott himself) leaves no doubt that the “litany” referred to Ogilvie’s patent infringement claim: "Manildra has given them a hold harmless letter regarding any possible violations of patents." Id. Calott testified: Q. Can you tell us what your litany on your position in the LGS field consisted of? A. Well, we, of course, purchased the business and the patents and so forth from Staley [sic]. * * * That cost us money. We have to get our money back. Therefore, we maintain our price because we feel that we have an investment in the business. Consequently, its as simple as that, that’s why were [sic] a leader. Q. Related to the patents? A. Related to purchasing the patents. And we try to maintain our leadership by salesmanship and service. [Tr. 2173-4, p. 59a-60a. | Then, only three weeks later, Keller wrote his memo, Ex.715 (p. 94a), advising his superior that Ogilvie was claiming infringement and, to avoid the risk of litigation, Moore was going to limit its purchases from Manildra severely. It required no leap of faith, indeed it was entirely reasonable, for the jury and the district court to conclude that the “litany” was exactly as Keller described: Ogilvie’s renewed charges of infringement. The jury also heard evidence from the field: Only a month after the “litany” meeting, the purchasing agents at Moore’s Fremont plant told Manildra that they had to take on Ogilvie “because of the so-called patent position involved." Ex. 714, p. 93a. Despite the efforts of the Fremont plant to take advantage of Manildra’s lower SD ALE anabe Cb bet wil Yates. 19 price (Ex. 747, p. 96a), they were restricted due to the “legal ramifications." Ex. 752, p. 97a. Manildra continued to be shut out of the new business, even though Ogilvie’s price was higher and Moore found serious quality problems with its product. Ex. 775, p. 98a. This evidence showed that Ogilvie habitually raised the patent issues with Moore (March 1985, January, February and August 1986), that those discussions included the possibility of infringement litigation, and that Moore responded by restricting Manildra’s sales despite its lower price and higher quality. Against that background, Ex. 715 represented far more than a scintilla of evidence.'* Seldom in any trial will an accused wrongdoer directly and unqualifiedly admit the alleged wrong.'* That is what the jurors '* Appleton and Mead were the other principal buyers of the product. Appleton never made any commercial purchases from Manildra because the general manager of Henkel (the company from whom Ogilvie purchased the patents and the business of selling the accused product in 1985) had threatened Appleton with an infringement suit and had accused Manildra of infringement in the early 1980s. When Ogilvie bought the business, it hired the same individual as its own general manager. Thereafter, Appleton told Manildra that “nothing had changed” and the reasons for Appleton’s original decision still applied. Unlike Appleton, Mead did buy some product from Manildra. Mead was subjected to the same “litany” before Ogilvie bought the business in 1985. The Henkel sales call reports make clear that the litany, when first delivered to Mead by senior officials of Henkel in 1983, included a threat that “an infringing manufacturer’s customer” could be drawn into suit. After Ogilvie purchased the business, it retained those very officials, who continued to call upon Mead, reminding them that “the patents had not run out.” " Ogilvie’s general manager virtually did in this case by admitting that he “may” have told customers Manildra was an infringer. Certainly, a reasonable juror can take “may” to mean “did” when he hears it from the mouth of the general manager of a defendant from whom the plaintiff is seeking several million dollars. 20 are for -- to draw reasonable inferences from the available evidence. In this case, however, the Federal Circuit improperly assigned itself that task and drew the opposite inference from the evidence. 2. The Hancock Evidence The jury was also entitled to consider and rely on the opinions ot Manildra’s expert economist, John Hancock. Hancock testified unequivocally that, from an economic point of view, the sole explanation for the fact that Manildra could capture only a small share of the market was Ogilvie’s charges of infringement and the implicit threat to customers of involvement in expensive litigation. Tr. 4436-38, 4476-85, 4490-93, 4501-2, 4513-14, 4516-22, pp. 65a-84a. C. Given Ogilvie’s Admission, the Federal Circuit Should Not Have Examined the Sufficiency of Evidence on this Issue. Throughout the proceedings, Ogilvie never denied that it had told customers that Manildra was an infringer; it rested its entire defense on its contention that it had acted in good faith. For example, in its oral motion for a directed verdict, Ogilvie’s counsel Stated: [I]n the absence of bad faith, the patent holder has the unconditional right to assert or threaten litigation. Therefore, in this case the question is not whether Ogilvie asserted or even threatened to enforce its patent rights, the Furthermore, only the jury, not the Federal Circuit, could begin to evaluate his demeanor and responses when he testified. 21 question is whether it acted in good faith.... [Tr. 7267, p. 84a, emphasis added. ] He then pointed to testimony that Ogilvie told customers that it "stood ready to enforce its rights;" it had “valid patents and would protect them as we see fit," those patents covered "use and process" on large granule wheat starch and Manildra was not licensed. Those and other comments vividly catalogued Ogilvie’s policy of aggressively asserting its patent rights. Tr. 7267-69, pp. 84a-85a. Nowhere in that motion did Ogilvie suggest that there was insufficient evidence that it had told the trade that Manildra was an infringer. After the jury’s verdict, Ogilvie moved for Judgment as a Matter of Law, asserting its good faith but admitting that it told customers that Manildra was infringing its patents: As discussed elsewhere in this memorandum, the only possible conclusion that could be drawn from the evidence was that the Ogilvie salesmen had a good faith belief that the patents were valid and infringed by Manildra and so Stated to customers. (Memorandum, p. 47, p. 102a, emphasis added.] The trial judge denied Ogilvie’s motion and its motion for a new trial, noting that substantial evidence supported the jury’s verdicts under the Lanham Act and Kansas unfair competition law, including the jury’s findings that Ogilvie acted in bad faith and with malice. Even on appeal, Ogilvie continued to argue that it had acted in good faith, and it never denied that it had told customers that Manildra was infringing: Here, Manildra claims that Ogilvie misrepresented that the Patents were valid and infringed. Yet, Ogilvie had a right to say just that. There was no adjudication to the contrary. The law presumes such statements are made in good faith. [Brief, p. 53, p. 104a-105a.] 22 The state tort claims should not have gone to the jury because Manildra did not show by clear and convincing evidence that Ogilvie acted in bad faith in stating its belief in the Patents’ validity and in Manildra’s infringement. [Reply Brief, p. 29, p. 107a.] The Federal Circuit itself has held that: the printed record on appeal more often than not will not reflect all the persuasive issues that may have determined the course of events at trial, even when that record is reviewed in its entirety by the appellate court. Biodex Corp. v. Loredan Biomedical, Inc., 946 F.2d 850, 860, (Fed. Cir. 1991). For that reason, the Federal Circuit has adopted a rule precluding review of the sufficiency of evidence "absent some post-verdict disposition” by the trial judge. Id. at 946 F.2d 862. The rule should have applied here, where Ogilvie failed to raise the evidentiary issue in its post-verdict motions. See Walters v. City of Atlanta, 803 F.2d 1135, 1146 (11th Cir. 1986) ("To preserve such a [lack of sufficient evidence] claim for appeal, a party must squarely present it to the trial court...."). The court’s examination of the sufficiency of evidence in this case, where the appellant in its post-verdict motion admitted the existence of the requisite evidence, was directly contrary to the Federal Circuit's own Biodex rule and the teaching of Cone v. West Va. Pulp & P. Co., 330 U.S. 212, 216 (1947): Determination of whether a new trial should be granted or a judgment entered under Rule 50(b) calls for the judgment in the first instance of the judge who saw and heard the witnesses and has the feel of the case which no appellate printed transcript can impart. Ogilvie’s admissions about what it told the customers concerning infringement is the best possible evidence that the jury’s finding of fact was reasonable. Certainly if, as the Federal Circuit concluded, ae RR IO ii PAI Dra BO ha aS 23 there was only a "mere scintilla” of evidence to support the jury’s finding, Ogilvie’s lawyers would not have conceded the point both during the trial and in their post-trial papers. In short, there can be no doubt that there was substantial evidence to support a finding by a reasonable juror that Ogilvie warned the trade that Manildra was infringing its patents. IV. Conclusion The Federal Circuit has demonstrated that, absent corrective action by this Court, it will consider itself free to conduct expansive fact-finding on appeal. It is willing to extend this practice far beyond any arguable scope of its patent expertise, even to naked questions of fact totally unrelated to patent issues. To preserve the Seventh Amendment rights of litigants whose cases come before the Federal Circuit, this Court should act again to give supervision and direction to that court. As in Panduit, summary procedure would permit this Court to preserve the established rights to trial by jury without requiring briefs and oral argument. Respectfully submitted, Murray J. Belman 700 14th Street, N.W. Washington, D.C. 20005 (202) 508-1000 Of Counsel: Counsel of Record W. Stanley Walch Mark §. Sableman Roman P. Wuller Halpin J. Burke APPENDIX a eee Before RICH, MICHEL and CLEVENGER, Circuit Judges. la NOTE: Pursuant to Fed. Cir. R. 47.8, this disposition is not citable as precedent. It is a public record. The disposition will appear in tables published periodically. UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT 92-1462,-1480 MANILDRA MILLING CORPORATION, Plaintiff/Cross-Appellant, v. OGILVIE MILLS, INC., Defendant-Appellant, v. HENKEL CORPORATION and HENKEL OF AMERICA, INC., Third-Party Defendants, and JOHN THOMAS HONAN, Counterclaim Defendant. DECIDED: June 22, 1993 2a CLEVENGER, Circuit Judge. Ogilvie Mills, Inc. (Ogilvie) appeals from the June 15, 1992 judgment of the United States District Court for the District of Kansas,' entered on the basis of a jury verdict, holding, inter alia, claims 1-3, 8-10, 16-19 and 24-27 of U.S. Patent No. 3,901,725 and claims 1, 6-10 and 12-14 of U.S. Patent No. 4,280,718 invalid and not infringed by Manildra Milling Corporation (Manildra), and Ogilvie liable under section 43(a) of the Lanham Act and the Kansas state law causes of action for tortious interference with prospective economic advantage and injurious falsehood. We affirm-in-part, reverse-in- Vv -in- U.S. Patent No. 4,280,718 (°718 patent), entitled "Pressure Sensitive Recording Sheet Containing Size Classified Cereal Starch Granules," issued on July 28, 1981 to Johnson et al., who assigned their rights to Henkel Corporation (Henkel). It is directed to the use of fractionated large granule wheat starch (LGWS) as a stilting material in carbonless copy paper (CCP)’ to prevent premature ' Manildra Milling Corp. v, Ogilvie Mills, Inc., No. 86-2457-S (D. Kan. Feb. 27, 1992) (Judgment); (June 15, 1992) (amended Judgment); 797 F. Supp. 874 (D. Kan. 1992) (memorandum and order disposing of various post-trial motions); (June 16, 1992) (order). oy ~ CCP functions by forming an image on the lower sheet of CCP when pressure on the upper sheet breaks easily rupturable dye microcapsules on the backside of the upper sheet, causing the dye to contact and darken a chemical on the upper surface of the lower 8 ee ee UE 3a rupture of fragile dye microcapsules through casual contact with the layered paper. U.S. Patent No. 3,901,725 (’725 patent), entitled "Size Classified Cereal Starch Granules," issued on August 26, 1975 to Bond et al., who assigned their rights to A. E. Staley Manufacturing Company (Staley). Henkel purchased Staley’s rights in the °725 patent in November 1978. It is directed both to the process for producing LGWS from a _ clean starch feed through hydroclassification,’ and to the LGWS itself. Both patents at issue in this case originate from, and trace their prosecution histories to, the same parent patent application, No. 180,588, filed by Staley in September 1971, and are each the result of a restriction requirement made in the original application by the Patent Office. Ogilvie, a subsidiary of Ogilvie Mills, Ltd. and a legal entity unaffiliated with Henkel, was incorporated in January 1985 and immediately acquired all rights in both the 718 and ’725 patents through an arms-length transaction with Henkel. In October 1986, Manildra filed a declaratory judgment action seeking a declaration that Ogilvie’s patents were invalid and not infringed. Manildra also asserted a claim for damages against both Ogilvie and Henkel,‘ respectively the present and prior owners sheet. > Simply stated, the patented process comprises, inter alia, the steps of feeding a clean starch slurry to a first hydrocyclone; feeding the resulting bottoms stream of partially classified LGWS to a second hydrocyclone; and producing LGWS meeting certain specifications as a bottoms stream from the second hydrocyclone. * Manildra settled with Henkel in January 1991, before the trial phase of the suit commenced. 4a of the patents, for violation of the federal antitrust laws, unfair competition under section 43(a) of the Lanham Act, and both tortious interference with prospective economic advantage and injurious falsehood under Kansas law. Ogilvie counterclaimed for willful infringement against both Manildra and its owner, Honan. After a lengthy trial,° the jury found by special verdict, inter alia, that (i) the patent claims in suit were invalid; (ii) the patent claims were not infringed, either literally or under the doctrine of equivalents; (iii) Ogilvie had not violated the federal antitrust laws; and (iv) Ogilvie had not misused its patents; but (v) Ogilvie was liable to Manildra (1) under section 43(a) of the Lanham Act; and (2) for both tortious interference with prospective economic advantage and injurious falsehood. In accordance with its verdict, the jury awarded Manildra $2,250,000 in actual damages and $2,500,000 in punitive damages. The court subsequently denied Ogilvie’s post-trial motions for judgment as a matter of law (JMOL) on all adversely-decided issues, for a new trial on those same issues, and for remittitur of the damages. The court also denied Ogilvie’s request for a ruling on its motion to correct inventorship under 35 U.S.C. § 256 (1988) and Manildra’s motions, inter alia, for a new trial on the antitrust claim and enhanced damages. The court, however, granted Manildra’s motion for reasonable attorney fees, having found that the case was “exceptional” under either 35 U.S.C. § 285 (1988) or 15 U.S.C. § 1117(a) (1988). Ogilvie appeals from the district court’s denials * The first trial to a jury resulted in a mistrial. The second jury trial resulted in the present appeal. Sa of its post-trial motions and Manildra cross-appeals from the denial of its motion for a new trial on its antitrust claim.° II In order to overturn a judgment entered on the basis of a jury verdict, the party against whom the judgment was rendered must demonstrate either that "the jury’s findings [on disputed material factual issues], presumed or express, are not supported by substantial evidence, . . . [or] if they [are so supported], that the legal conclusion(s) implied from the jury’s verdict cannot in law be supported by those findings." Read Corp. v. Portec, Inc., 970 F.2d 816, 821, 23 USPQ2d 1426, 1431 (Fed. Cir. 1992); Verdegaal Bros., Inc. v, Union Oil Co,, 814 F.2d 628, 631, 2 USPQ2d 1051, 1052 (Fed. Cir.), cert. denied, 484 U.S. 827 (1987). Rather than directly reviewing the jury’s verdict, we instead review the trial court’s denial of a renewed motion for JMOL under Rule 50(b) of the Federal Rules of Civil Procedure, and must decide for ourselves whether reasonable jurors viewing the evidence as a whole could have found the facts needed to support the verdict in light of the applicable law. If we conclude that no reasonable findings of fact, supported by substantial evidence, could support the verdict that was incorporated into the trial court’s judgment, then we must conclude that the trial court erred in not granting the motion for [JMOL]. * Manildra’s motion to strike certain portions of Ogilvie’s reply brief on appeal is denied. 6a Lemelson v, General Mills Inc,, 968 F.2d 1202, 1207, 23 USPQ2d 1284, 1288 (Fed. Cir. 1992), cert. denied, 113 S. Ct. 976 (1993). Substantial evidence is such relevant evidence, considering the record as a whole, on which a reasonable jury might base the verdict under review. Perkin-Elmer Corp. v. Computervision Corp., 732 F.2d 888, 893, 221 USPQ 669, 673 (Fed. Cir.), cert. denied, 469 U.S. 857 (1984). Substantial evidence, however, constitutes more than a “mere scintilla." Biodex Corp., v. Loredan Biomedical, Inc., 946 F.2d 850, 859, 20 USPQ2d 1252, 1259 (Fed. Cir. 1991)(quoting Consolidated Edison Co, v. National Labor Relations Bd., 305 U.S. 197, 229 (1938)), cert. denied, 112 S. Ct. 2957 (1992). After full review of the record, we conclude that the district court erred in failing to grant Ogilvie’s renewed notion for JMOL on the Lanham Act and state law tort claims, but that we cannot disturb the judgment on invalidity and noninfringement. Il Ogilvie makes several arguments on appeal regarding the jury’s findings of invalidity of both patents. Ogilvie argues that claims 24-27 of the °725 patent were not anticipated under 35 U.S.C. § 102 (1988) because the pertinent prior art reference, a paper published by Yamazaki, (i) lacked utility and did not demonstrate a reduction to practice of the disclosed subject matter; (ii) related to subject matter other than that defined in claims 24-27; and (iii) was not enabling to one of ordinary skill in the art. Ogilvie also argues that Manildra failed to demonstrate that all claims at issue would have been obvious under 35 U.S.C. § 103 (1988) in light of the prior art proffered at trial. Ogilvie’s various arguments include (i) the classified wheat sample produced at trial and testimony on prior efforts to classify wheat starch do not 7a constitute prior art for use in the obviousness analysis; (ii) Yamazaki’s paper did not provide sufficient information for a person of ordinary skill in the art to discern a solution to the problem of classifying LGWS; (iii) in light of the testimony on the degree of skill corresponding to “ordinary skill in the art," (a) U.S. Patent No. 2,642,185 (Fontein)’ would not have rendered the ’718 and 725 patents’ claims obvious because it does not disclose every limitation present in the claims and does not disclose an apparatus capable of producing LGWS satisfying the claims’ range criteria; and (b) British Patent No. 1,252,858 (NCR)* would not have rendered the °718 claims obvious because, inter alia, the specification allegedly discourages any modification of natural starch for use in CCP. Ogilvie also argues that 35 U.S.C. § 112 (1988) cannot provide a basis for sustaining the jury’s verdict. Finally, Ogilvie argues that it is entitled to a new trial on validity of both patents because the trial court erroneously permitted Yamazaki’s testimony on subject matter not explicitly contained within his written document. In reviewing a jury’s verdict concerning patent validity, we presume the jury made the proper findings to support its verdict. Shatterproof Glass Corp. v. Libbey-Owens Ford Co., 758 F.2d 613, 619, 225 USPQ 634, 637 (Fed. Cir.), cert. dismissed, 474 U.S. 976 ” Fontein discloses a method for refining and isolating starch granules below 7 microns in diameter. Two hydrocyclones are operated in series, with the overhead fine particle stream from the first hydrocyclone used as a feed stream for the second. * NCR discloses use of large granule starch as a stilting material in CCP, and discusses various sources of starch for such use, including arrowroot and wheat. 8a (1985). The record before us and Ogilvie’s arguments provide us with an insufficient basis on which to upset the jury’s verdict on invalidity of all the claims in issue. Accordingly, the district court did not err in refusing to grant Ogilvie’s renewed motion for JMOL on validity of the claims in issue. We also conclude that the district court did not abuse its discretion in refusing to grant a new trial on the issue of validity of the patent claims in issue. See Railroad Dynamics, Inc. v. A. Stucki Co,, 727 F.2d 1506, 1512, 220 USPQ 929, 936 (Fed. Cir.)(reviewed district court’s denial of motion for new trial for abuse of discretion), cert. denied, 469 U.S. 871 (1984). IV Determining whether a patent is infringed in a particular case requires a two-part analysis. First, the claims must be interpreted without regard to the accused manufacture or process in light of the specification, the prosecution history, the patent’s other claims and, if necessary, extrinsic evidence such as expert testimony. Hormone Research Found., Inc, v. Genentech Inc., 904 F.2d 1558, 1562, 15 USPQ2d 1039, 1043 (Fed. Cir. 1990), cert. dismissed, 111 S. Ct. 1434 (1991). Claim interpretation is a question of law that this court reviews de novo. Key Mfg. Group, Inc, v. Microdot, Inc., 925 F.2d 1444, 1448, 17 USPQ2d 1806, 1809 (Fed. Cir. 1991). Second, the fact-finder must determine whether each properly interpreted claim “reads on" the accused Structure or process to determine whether the accused matter incorporates each claim limitation, either literally or by its equivalent. Minnesota Mining & Mfg. Co. v. Johnson & Johnson Orthopaedics, Inc., 976 F.2d 1559, 1570, 24 USPQ2d 1321, 1330 (Fed. Cir. 1992). Such infringement determinations are questions of fact. SRI Int’l v. Matsushita Elec, Corp. of Am., 775 F.2d 1107, 9a 1125, 227 USPQ 577, 589 (Fed. Cir. 1985)(in banc). Finally, it is not our function as an appellate court to substitute our judgment for that of the jury and determine for ourselves whether we would have concluded that the product infringes the claims, but rather whether there is sufficient evidence to support a jury verdict on the issue. Dana Corp, v. IPC Ltd. Partnership, 860 P.2d 415, 417, 8 USPQ2d 1692, 1694 (Fed. Cir. 1988), cert. denied, 490 U.S. 1067 (1989); Perkin-Elmer, 732 F.2d at 893, 221 USPQ at 673. A Regarding interpretation of the claims in issue, Ogilvie argues that the claim language "about 22% of the total number of granules . . . being at least 22 microns” should be read to encompass a product with 22% by number of granules having a diameter of at least 17 microns. Likewise, Ogilvie argues that the language “about 99% by weight of the granules are at least 12 microns in size" should be read to embrace LGWS with at least 95% by weight of granules having a diameter of at least 12 microns. Ogilvie supports its arguments by reasoning that because the standard size of the dye microcapsules to be protected by the stilting material has decreased in the CCP industry, as has the corresponding requisite size of the stilting material particles, the claim limitations setting forth the requisite size limitations should be adjusted accordingly. We find these arguments unpersuasive. The claims of a patent delineate the metes and bounds of the patentee’s right to exclude others from making, using or selling. Palumbo v. Don-Joy-Co., 762 F.2d 969, 974, 226 USPQ 5, 8 (Fed. Cir. 1985); 35 U.S.C. § 154 (1988). A familiar canon of claim construction is that while a patentee may be his own lexicographer, a word will be given its ordinary and accustomed meaning unless it appears that the inventor used it differently. ZMT Corp. v, Cardiac TW 10a Resuscitator Corp., 844 F.2d 1576, 1580, 6 USPQ2d 1557, 1560 (Fed. Cir. 1988). In this case, Ogilvie’s patents do not claim a particle size that would require interpretation, such as "a granule of a size substantially larger than the size of the dye microcapsule to be protected.” Instead, they specifically and unambiguously delineate numerical ranges of granule size and quanta. We thus interpret the claims exactly as they are written. B In order to infringe a patent claim literally, each and every limitation in the claim must actually be present in the accused structure or process. Hi-Life Prods,, Inc, v, American Nat'l Water- Mattress Corp., 842 F.2d 323, 325, 6 USPQ2d 1132, 1133 (Fed. Cir. 1988). Failure to ..eet a single limitation is sufficient to negate an allegation of infringement of the claim. Laitram Corp. v. Rexnord, Inc,, 939 F.2d 1533, 1535, 19 USPQ2d 1367, 1369 (Fed. Cir. 1991). Ogilvie argues repeatedly that the evidence presented at trial demonstrates that Manildra’s M-80 product has 97% by weight of particles greater than 12 microns in size and 22% by number greater than 20 microns in size, and therefore M-80 infringes the "718 and 725 patents. Ogilvie’s literal infringement argument depends on its construction and interpretation of the claims in issue. Our rejection of Ogilvie’s interpretations necessarily requires us to conclude that the claims as properly interpreted are not literally infringed. Moreover, although M-80 data were presented at trial that would have supported a finding of infringement of the claims’ granule size and quanta limitations, there was also more than substantial evidence for the jury to have concluded otherwise, as it did. lla Ogilvie also argues that Manildra’s process’ literally infringes claims 16-19 of the ’725 patent because essentially all of the classification of the wheat starch occurring in Manildra’s process occurs in the two hydrocyclones before the air classifier, and therefore the air classifier is simply superfluous and a bald subterfuge for avoiding infringement. Although there is evidence to the contrary, the evidence supporting the jury’s verdict on this issue is substantial and therefore legally sufficient to prevent our disturbing the jury’s findings of fact on this issue. C Ogilvie argues that even if the evidence does not demonstrate literal infringement, it "is absolutely evident" that Manildra’s product infringes under the doctrine of equivalents because “the Manildra stilt is so nearly identical to the Patents’ [numerical] limitations.” Thus, according to Ogilvie, the district court erred in failing to grant its renewed motion for JMOL. While this argument is facially appealing since the evidence before the jury demonstrated that Manildra’s product came close to satisfying the claims’ numerical limitations, Ogilvie is precluded as a matter of law from prevailing on its contention. Prosecution history estoppel is a policy-oriented limitation on the range of equivalents available to the patentee. Loctite Corp. vy. Ultraseal, Ltd., 781 F.2d 861, 870, 228 USPQ 90, 96 (Fed. Cir. 1985). Prosecution history estoppel will not allow the patentee to extend the range of equivalents accorded the subject matter to that ® Manildra’s process for producing LGWS incorporates use of two hydrocyclones to “wash” the wheat starch feed and an air classifier which receives the washed starch stream, after drying, as feed and produces the LGWS product. 12a relinquished during patent prosecution, Id,, 228 USPQ at 96. The range of equivalents available to the patentee is a question of law which we review de novo. Id,, 228 USPQ at 96. During prosecution of both the °718 and '725 patents, the applicants, inter alia, specifically represented to the Patent Office that size limitations were "critical to [the] utility" and therefore the patentability of the claimed subject matter. For example, during prosecution of the application that ultimately spawned the '718 patent, the applicants stated: Applicants urge [the] critical limit[{ation] of [greater than] 22% of [greater than or equal to] 22 microns in size. *~* * [T]he particle size range of the starch fraction used on the surface coated with rupturable micro- capsules is of critical importance to prevent premature rupturing of the micro-capsules during handling. Ogilvie argues that because these limitations were not added to the claims as part of an amendment in response to a rejection, it cannot be prevented from expanding its right to exclude to encompass Manildra’s product. It has long been held, however, that an estoppel is created merely by arguments submitted to obtain the patent, as well as traditionally by an applicant’s conduct reactive to an examiner’s rejection. E.g,, Hughes Aircraft Co. v. United States, 717 F.2d 1351, 1362, 219 USPQ 473, 481 (Fed. Cir. 1983). Having stressed the criticality of the substantive size and quanta limitations of the LGWS, Ogilvie cannot now escape the accompanying strictures on its right to exclude under 35 U.S.C. §§ 154, 271 (1988). Our review of the record and arguments presented on appeal convinces us that the jury verdict of non- infringement under the doctrine of equivalents cannot be disturbed. 13a Ogilvie likewise argues that Manildra’s process infringes its patent under the doctrine of equivalents. After reviewing the record, however, we are convinced that there was substantial evidence before the jury to support a conclusion that the air classifier in fact plays an integral and important role in Manildra’s production of LGWS, and therefore the jury's implicit finding that the accused process does not infringe under the doctrine of equivalents because the process achieves production of LGWS in a substantially different way. D In conclusion, and on the record before us, we are unable to find any basis on which to disturb the jury’s verdict on infringement of the claims in issue of the '718 and ’725 patents. As the district court stated in correctly denying Ogilvie’s renewed motion for JMOL on infringement: [T)he court finds that much evidence was presented on this issue both supporting a finding of infringement and supporting a conclusion of non- infringement. The jury chose to believe the evidence supporting non-infringement. This court cannot say as a matter of law, considering all inferences in the favor of the nonmoving party, that Ogilvie was entitled to a judgment on the issue of infringement. Manildra Milling Corp, v, Ogilvie Mills, Inc,, 797 F. Supp. 874, 886 (D. Kan. 1992). Since we conclude that we cannot upset the jury’s verdict of noninfringement, we need not reach the issues of Manildra’s alleged inducement to infringe or its alleged willful infringement, since both allegations rely on a predicate finding of actual infringement, l4a whether literal or by equivalents. See Water Technologies Corp. v. Calco, Ltd., 850 F.2d 660, 668 n.7, 7 USPQ2d 1097, 1103 n.7 (Fed. Cir.), cert. denied, 488 U.S. 968 (1988). Finally, Ogilvie also appeals the trial court’s denial of its motion for a new trial on infringement. Ogilvie makes a variety of evidentiary arguments in an attempt to demonstrate that the court abused its discretion in denying the motion. Those arguments only demonstrate that, with regard to infringement, there is some evidence to support Ogilvie’s contention. Ogilvie, however, has failed to demonstrate that the district court abused its discretion in refusing to grant a new trial on infringement of the patent claims in issue. Vv There are three separate causes of action at issue under which Ogilvie was found liable: section 43(a) of the Lanham Act"® ' Section 43(a) of the Lanham Act reads: Any person who, on or in connection with any goods . . ., uses in commerce any . . . false or misleading description of fact, or false or misleading representation of fact, which- xx * (2) in commercial advertising Or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of . . . another person’s goods, services, or commercial activities, shall be liable in a civil action by any person who believes that he or she is or is likely to be damaged by such act. 15a and the Kansas law causes of action for tortious interference with prospective economic advantage"’ and injurious falsehood.’? This 15 U.S.C. § 1125(a)(1988)(emphasis added). '' Tortious interference with prospective economic advantage under Kansas law consists of the following elements: (i) existence of a business relationship or an expectancy with a probability of future economic benefit to the plaintiff; (ii) defendant’s knowledge of the relationship or expectancy; (iii) that, except for the defendant’s conduct, the plaintiff was reasonably certain to have continued the relationship or to have realized the expectancy; (iv) intentional misconduct by the defendant; and (v) damages suffered by the plaintiff as a direct or proximate cause of the defendant’s misconduct. Reazin v. Blue Cross & Blue Shield, Inc., 899 F.2d 951, 977 (10th Cir.)(emphasis added), cert, denied, 497 U.S. 1005 (1990). '? Under Kansas law, [o]ne who publishes a false statement harmful to the interests of another is subject to liability for pecuniary loss resulting to the other if (a) he intends for publication of the statement to result in harm to interests of the other having a pecuniary value, or either recognizes or should recognize that it is likely to do so, and (b) he knows that the statement is false or acts in reckless disregard of its truth or falsity. Bacchus Indus., Inc, v. Arvin Indus., Inc,, 939 F.2d 887, 892-93 (10th Cir. 1991)(citing Restatement (Second) of Torts § 623A (1979)(emphasis added)). 16a court has jurisdiction to review both the Lanham Ac and state law issues. See 28 U.S.C. §§ 1295(a)(1), 1338 (1988). Not having exclusive jurisdiction over these types of claims, however, we apply Tenth Circuit law to the Lanham Act claim, see, e.g., Jurgens v. McKasy, 927 F.2d 1552, 1564, 18 USPQ2d 1031, 1039 (Fed. Cir.), cert. denied, 112 S. Ct. 281 (1991), and Kansas law to the State tort actions. Again, the issue before us is whether the record includes evidence legally sufficient in quantum to support the jury’s verdicts on each cause of action. For the purpose of reviewing the jury’s verdicts in this case, we focus on the common thread of each of the causes of action--namely, that all three require either falsity, whether literal or simply deceptive or misleading,” or misconduct’* ("“wrongful” elements). A basic premise of any cause of action is that the party on whom the burden of proof initially rests, typically the complainant, must establish a prima facie case by introducing evidence on each and every element of the cause of action. 29 Am. Jur. 2d Evidence §§ 123, 128-129 (1967). Failure to present evidence on even one necessary element is fatal to the complainant’s case as a matter of law. Manildra argues in this overly adversarial portion of the appeal that Ogilvie’s patent “litany” constituted a series of misrepresentations to their mutual customers that Manildra was '® See Charles E. McKenney & George F. Long, III, Federal Unfair Competition; Lanham Act § 43(a) § 6.03[2], at 6-14 to -15 (1991). ‘Whether certain conduct is “misconduct” is determined by considering the factors listed in Restatement (Second) of Torts § 767 (1979). Reazin, 899 F.2d at 977 n.37; see also Turner v. Halliburton Co,, 722 P.2d 1106, 1116-17 (Kan. 1986); 17a infringing the patents in suit and therefore the customers acted at their own risk in purchasing the infringing product. According to Manildra, this “litany” satisfies the “wrongful” elements and therefore provides a sufficient basis on which to find Ogilvie liable. Manildra’s argument is premised on the alleged statements being false as a matter of fact because the jury found Manildra not to be infringing either patent: There was abundant evidence in the record that Ogilvie intentionally, knowingly and in bad faith made false claims that Manildra infringed the patents, and that those statements induced [the LGWS purchasers] to limit their purchases from Manildra. At oral argument, Manildra also emphasized Ogilvie’s alleged representations to its customers that its patents dominated the field of LGWS and thus any use of LGWS from an entity other than Ogilvie or its licensees would infringe and would embroil the infringer in litigation. Manildra argues that the reaction of their customers in refusing to buy from Manildra “simply because of the legal situation” confirms Manildra’s view of the case. Contrary to Manildra’s position, however, is our conviction that the record in this case does not contain evidence sufficient to establish the critical “wrongful” elements. Moreover, the record fails to establish both the composition of the “litany” and how the “litany” renders Ogilvie liable under the state laws and the Lanham Act. In support of its argument, Manildra lists exhibit after exhibit which purportedly corroborate its position. Yet after examining the entire record on appeal, we have discovered only one document, referred to as P715, out of several thousand trial exhibits, that provides some evidence that Ogilvie without qualification stated that Manildra was infringing its patents. Moreover, this single document is not a direct communication between Ogilvie and one of 18a its customers, but rather is an internal customer memorandum between two of the customer’s employees regarding future LGWS purchases and a future expansion of business, in which context the memorandum summarizes Ogilvie’s statements. The other exhibits simply do not support the proposition for which they are cited. Furthermore, out of over fifteen thousand pages of transcript, no testimony directly bears on Ogilvie’s falsity/misconduct.'* This court has also discovered no evidence, and was not directed to any by the parties, that supports Manildra’s “domination” argument. As conceded by Manildra, we cannot consider Henkel’s conduct and statements in this regard. In fact, 'S Manildra concedes that Henkel’s past conduct and statements regarding Manildra’s infringement should not be taken into account as direct evidence of the “wrongful” elements in determining the substantial evidence issue regarding Ogilvie’s liability. Manildra argues, however, that the evidence of Henkel’s conduct can be used to infer Ogilvie’s conduct because Ogilvie continued to employ some of Henkel’s salespersons who had, while in Henkel’s employ, represented Manildra’s conduct as infringing. The actual evidence, however, demonstrates that these particular persons, when in Ogilvie’s employ, were careful not to mislead their customers with false statements. Since Henkel and Ogilvie are unaffiliated legal entities, there is no justification for attributing Henkel’s actions to Ogilvie absent some evidence of an adoption of Henkel’s policies. Since the record lacks any such evidence, Manildra’s position is untenable. Moreover, the jury was instructed that Henkel’s conduct, occurring before Ogilvie’s creation, could not be considered in determining whether Manildra had carried its burden of proof in demonstrating all the elements of its state law and Lanham Act claims. This instruction is not challenged by the parties on appeal. 19a once the evidence of Henkel’s conduct is excised from this appeal, Manildra’s whole case on the Lanham Act and state law tort claims disintegrates. At oral argument, Manildra was exhorted to underscore the evidence on which it based its allegations and on which a reasonable jury could have based its verdict. Manildra could only respond with the documents already examined by this court and rely on “inferences” that “have to [be drawn]" by this court. Since substantial evidence requires more than a "mere scintilla” of evidence, Biodex Corp., 946 F.2d at 859, 20 USPQ2d at 1259, we conclude on this record that a reasonable jury could not have found Ogilvie liable to Manildra under the Lanham Act and the state law causes of action because the evidence on the "wrongful" elements of those claims constitutes at most a "mere scintilla." Since we conclude that the record fails to establish conduct On Ogilvie’s part that would qualify for liability under the Lanham Act, we need not decide whether the Lanham Act should even come into play in the situation where a patentee is publicizing the presumed validity of its patents and belief in a competitor’s infringement thereof. See, e.g., Tubeco, Inc. v. Crippen Pipe Fabrication Corp., 402 F. Supp. 838, 847, 187 USPQ 746, 752 (E.D.N.Y. 1975)(communications to customers and prospective licensees regarding patent are "in no sense the false advertising at which the Lanham Act was aimed."), aff'd, 538 F.2d 314 (2d Cir. 1976)(table); cf. Lang v. Pacific Marine & Supply Co., 703 F. Supp. 1404, 1411, 10 USPQ2d 1058, 1063 (D. Haw. 1989)(section 43(a) is intended to reach false advertising violations, not false patent claims), aff'd, 895 F.2d 761, 13 USPQ2d 1820 (Fed. Cir. 1990); compare with Brandt Consol., Inc. v. Agrimar Corp., 801 F. Supp. 164, 174, 24 USPQ2d 1341, 1348-49 (C.D. Ill. 1992) (citing Chromium Indus., Inc, v. Mirror Polishing & Plating Co., 448 F. Supp. 544, 555, 199 USPQ 146, 159 (N.D. Ill. 1978)(false 20a statements that competitor infringes a patent states a section 43(a) violation)). Likewise, we also have no reason to address Ogilvie’s argument that it is shielded from liability as a matter of law because it is entitled under the federal patent laws to assert both the validity of its patents and Manildra’s infringement. We thus leave for another day resolution of any existing tension between, and the accompanying limitations on, the right of a patentee under the federal patent laws to announce a competitor’s suspected infringement of its patents to the marketplace and the states’ laws of “unfair competition.” See, e.g., Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 152 (1989)(an entity cannot be liable under state law for conduct that is permitted by federal law); Loctite Corp., 781 F.2d at 877, 228 USPQ at 100-01 (following Handgards, Inc. v. Ethicon, Inc., 601 F.2d 986, 202 USPQ 342 (9th Cir. 1979), cert. denied, 444 U.S. 1025 (1980))(patentee must be able to engage in legitimate enforcement efforts to protect its rights in the face of potential infringement). At this time, we also need not address the influence of the First Amendment’s protection of freedom of speech in the commercial context and the role of a competitor’s qualified privilege on any existing tension between federal and state laws. See Virginia f Ph v. Virginia Citi nsumer ncil, Inc., 425 U.S. 748, 765 (1976)(dissemination and free flow of commercial information in free enterprise economy is indispensable). VI Because we conclude that the record does not support Ogilvie’s alleged violation of section 43(a) of the Lanham Act and therefore reverse the judgment on this ground, we also reverse the 21a district court’s award of attorney fees based on 15 U.S.C. § 1117(a). To the extent that the case was found “exceptional” under 35 U.S.C. § 285, however, we vacate the determination and remand for reconsideration of the issue in light of this opinion. Vil The district court denied Ogilvie’s motion to correct inventorship on the °718 and °725 patents, and U.S. Patent No. 3,951,948 (948 patent) not otherwise at issue in this case. Ogilvie argues that the district court abused its discretion in denying its motion after finding that the error in failing to name all of the inventors in each patent resulted from inadvertent oversight without any deceptive intention, as required by 35 U.S.C. § 256. Manildra Milling Corp, v. Ogilvie Mills, Inc., 745 F. Supp. 653, 655, 19 USPQ2d 1186, 1187-89 (D. Kan. 1990)(ruling on motion deferred until after trial); Manildra Milling, 797 F. Supp. at 889-90. As to the claims-in-issue of the °718 and °725 patents, the district court denied Ogilvie’s motion as moot since the claims had been held invalid. Ogilvie has not demonstrated that this action constituted an abuse of the court’s discretion in this matter. The district court, however, did not otherwise explicitly address Ogilvie’s motion. Thus, on remand, Ogilvie will have the opportunity to renew its motion to correct inventorship under section 256 as to the remaining, unadjudicated claims of the "718 and ’725 patents as well as to the 948 patent. Vill Manildra cross-appeals the trial court’s denial of its motion for a new trial on its antitrust claims. Manildra argues that the court incorrectly instructed the jury on the "double hurdle” nature 22a of an antitrust claim and on how the evidence of Henkel’s past conduct could be used. Having reviewed the arguments, we find that the court did not abuse its discretion in denying a new trial on this issue. IX For the foregoing reasons, the judgment of the United States District Court for the District of Kansas based on the jury verdict of invaiidity and noninfringement is affirmed; the judgment on the Lanham Act and state law claims for tortious interference and injurious falsehood, and the accompanying award of compensatory and punitive damages, are reversed; and the award of attorney fees is vacated for reconsideration. Each party is to bear its own costs. 23a UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT 92-1462,-1480 MANILDRA MILLING CORPORATION, Plaintiff/Cross-Appellant, v. OGILVIE MILLS, INC., Defendant-Appellant, Vv. HENKEL CORPORATION and HENKEL OF AMERICA, INC., Third-Party Defendants, and JOHN THOMAS HONAN, Counterclaim Defendant. ON PETITION FOR REHEARING Before RICH, MICHEL and CLEVENGER, Circuit Judges. CLEVENGER, Circuit Judge. ORDER 24a ORDER A suggestion for rehearing in banc having been filed by the APPELLANT, UPON CONSIDERATION THEREOF, it is ORDERED that the suggestion for rehearing in banc be, and the same hereby is, DECLINED. FOR THE COURT, FRANCIS X. GINDHART, CLERK Dated: October 5, 1993 By /s/ Diane M. Frye Chief Deputy Clerk cc: BYRON L. GREGORY MURRAY J. BELMAN MANILDRA MILLING V. OGILVIE, 92-1462 (DCT - 86-2457-S) Note: Pursuant to Fed. Cir. R. 47.6, this order is not citable as precedent. It is a public order. 25a UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT 92-1462,-1480 MANILDRA MILLING CORPORATION, Plaintiff/Cross-Appellant, v. OGILVIE MILLS, INC., Defendant-Appellant, v. HENKEL CORPORATION and HENKEL OF AMERICA, INC., Third-Party Defendants, and JOHN THOMAS HONAN, Counterclaim Defendant. ON PETITION FOR REHEARING Before RICH, MICHEL and CLEVENGER, Circuit Judges. CLEVENGER, Circuit Judge. ORDER Both Manildra Milling Corporation (Manildra) and Ogilvie Mills, Inc. (Ogilvie) petition for rehearing of the appeal, decided on a i 26a June 22, 1993 by the Court’s opinion and judgment. The Court having considered the petitions, IT IS ORDERED THAT: Ogiivie’s petition is denied. Manildra’s petition is granted solely for the purpose of revising the Court’s opinion as hereinafter provided: p. 4, In. 6: Delete "patents", and insert -- °718 patent--; p. 19, In. 19: Delete the sentence "The actual evidence . . . their customers with false statements.". FOR THE COURT eptember 20, 19 /s/ Date Raymond C. Clevenger, III Circuit Judge 27a IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF KANSAS MANILDRA MILLING CORPORATION, Plaintiff and Counterclaim Defendant, CIVIL ACTION OGILVIE MILLS, INC., Case No. 86-2457-S Defendant, Third-Party Plaintiff, and Counterclaimant, HENKEL CORPORATION, HENKEL OF AMERICA, INC., Defendants, and Third-Party Defendants, and ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) JOHN THOMAS HONAN, ) ) ) Counterclaim Defendant. 28a MEMORANDUM AND ORDER This matter is before the court pursuant to numerous post trial motions in the above-captioned case.' This action involves a longstanding dispute between the plaintiff and counterclaim defendant Manildra Milling Corporation ("Manildra") and the defendant, counterclaimant and third-party plaintiff Ogilvie Mills, Inc. ("Ogilvie") regarding the validity of various claims of two patents issued by the Patent and Trademark Office. The patent claims-in-issue cover the manufacture and sale of large-granule wheat starch, a product used in the manufacture of carbonless copy paper. _Large-granule wheat starch is uniquely suited for use as a coating or stilt material which protects ink- containing microcapsules from prematurely rupturing and smudging the surface of carbonless copy paper. Since the filing of the patents-in-suit, large-granule wheat starch has become the primary stilt material for carbonless copy paper. There are only three producers of large-granule wheat starch in the entire United States. Two of the producers are parties involved in this lawsuit. The third producer, Midwest Grains, Inc. ("Midwest Grains") sells large- granule wheat starch pursuant to a license agreement entered into between itself and Ogilvie’s predecessor patent owner, the Henkel Corporation ("Henkel"). In this action, Manildra sought a declaration that Ogilvie’s patents were not valid or enforceable and that Manildra had not infringed two patents which are owned by Ogilvie. Manildra further sought recovery for injuries which it claimed were caused by ' The court finds that oral argument will not materially aid the court in the disposition of the motions currently pending before the court. Accordingly, the court denies Ogilvie Mills, Inc.’s request for oral argument (Doc. 1154). D. Kan. 206(d). 29a activities related to the ownership of the patents. These claims included both federal and pendent state tort claims. Specifically, Manildra contended that Ogilvie had violated federal antitrust laws, the Lanham Act, 15 U.S.C. § 1125, which forbids false descriptions in the sale of goods in interstate commerce, and state law which forbids unfair competition and tortious interference with prospective economic advantage. Ogilvie filed a counterclaim seeking to recover damages from Manildra and its principal shareholder, John Thomas Honan ("Honan"), for infringement of the two patents. Beginning on August 26, 1991, and continuing until February 26, 1992, the claims between Manildra and Ogilvie were tried to a jury. On January 15, 1992, the case was submitted to the jury and on February 26, 1992, after approximately six weeks of deliberations, the jury returned a verdict in favor of Manildra on its claims that the patent claims-in-issue were invalid and that Manildra had not infringed these claims. The jury also returned a verdict in favor of Manildra on its claims under the Lanham Act, and its state claims for tortious interference with prospective economic advantage and for injurious falsehood. Ogilvie now moves for judgment as a matter of law, for a new trial, and for remittitur. Manildra moves the court for a new trial on its antitrust claims, and for increased damages and attorneys’ fees under both the Lanham Act and patent laws. Both parties move to amend the judgment, and for Rule 54(b) certification so that this matter may be appealed. Also before the court is Ogilvie’s request for a ruling on its motion to correct inventorship, and two outstanding motions by Manildra and Ogilvie for sanctions. In reviewing a motion for judgment as a matter of law, the district court may grant the motion only if the facts and inferences in the case point so strongly and overwhelmingly in favor of one party that the court should find that reasonable persons could not 30a arrive at a contrary verdict. Downie v, Abex Corp., 741 F.2d 1235, 1238 (10th Cir. 1984).? That is, the question is not whether there exists no evidence supporting the party against whom the motion is directed, but whether there is any evidence upon which the jury could properly find a verdict for that party. K-B Trucking Co. v. Riss Int’l, Corp., 763 F.2d 1148, 1163 (10th Cir. 1985). Furthermore, in considering the motion, the trial judge must consider all the evidence and the reasonable inferences derived therefrom in tne light most favorable to the party against whom the motion is directed. Downie, 741 F.2d at 1238. In considering a motion for judgment as a matter of law, the court presumes that the jury resolved the underlying factual disputes in favor of the verdict winner; these presumed findings remain undisturbed if they are supported by substantial evidence. Jurgens v. McKasy, 927 F.2d 1552, 1557 (Fed. Cir.), cert. denied, 112 S. Ct. 281 (1991)(citing Perkin-Elmer Corp. v. Computervision Corp., 732 F.2d 888, 893 (Fed. Cir.), cert. denied, 469 U.S. 857 (1984)). With regard to motions for a new trial, "[generally, motions for a new trial are committed to the discretion of the district court." McDonough Power Equip., Inc. v. Greenwood, 464 U.S. 548, 556 (1984). In reviewing a motion for new trial, the court should ? Although this action will be appealed to the Federal Circuit Court of Appeals, procedural issues not unique to the patent laws, i.e., such as the standard for granting or denying a motion for judgment as a matter of law, require the application of the regional Circuit’s law. See Wahpeton Canvas Co., Inc, Frontier, Inc,, 870 F.2d 1546, 1552 n. 8 (Fed. Cir. 1989); Sjolund v, Musland, 847 F.2d 1573, 1576 (Fed. Cir. 1988) (citation omitted). Accordingly, the court will apply Tenth Circuit law in determining whether Ogilvie’s motion for judgment as a matter of law should be granted or denied. 3la “exercise judgment in preference to the automatic reversal for error, and ignore errors that do not affect the essential fairness of the trial.” McDonough Power Equip., Inc., 464 U.S. at 553. "[T}he party seeking to set aside a jury verdict must demonstrate trial errors which constitute prejudicial error or that the verdict is not based on substantial evidence.” White v, Conoco, Inc., 710 F.2d 1442, 1443 (10th Cir. 1983). The alleged trial court errors must be prejudicial and clearly erroneous, rather than harmless. Also, no error in the admission or exclusion of evidence, and no error in any ruling or order of the trial court or anything done or omitted by the court, can be grounds for granting a new trial unless the error or defect affects the substantial rights of the parties. Fed. R. Civ. P. 61; Rasmussen Drilling, Inc, v. Kerr-McGee Nuclear Corp., 571 F.2d 1144, 1148-49 (10th Cir.), cert. denied, 439 U.S. 862 (1978). Trials must be fair, not perfect. McDonough Power Equip., Inc., 464 U.S. at 553; Devices for Medicine, Inc, v. Boehl, 822 F.2d 1062, 1066 (Fed. Cir. 1987). I. Ogilvie’s Post Trial Motions A. Motion for a New Trial The court will first address Ogilvie’s post trial motions. As an initial matter, the court finds no merit in the arguments asserted by Ogilvie in its motion for a new trial. During the six months of trial an adequate record was established for the court’s evidentiary rulings and rulings with regard to the jury instructions. Indeed, the parties were given many opportunities to challenge the court’s proposed jury instructions. The court stands by its previous rulings and will not address each of Ogilvie’s assertions of error, except to find that if any errors were made, they were harmless to the outcome of this case. 32a With regard to Ogilvie’s allegation that the jury reached an inconsistent verdict, the court finds that when confronted with an apparently inconsistent verdict, courts are to “search for a reasonable way to read the verdicts as expressing a coherent view of the case, and must exhaust this effort before it is free to disregard the jury’s verdict” and grant a new trial. Richardson v, Suzuki Motor Co,, Lid., 868 F.2d 1226, 1238 (Fed. Cir.), cert, denied, 493 U.S. 853 (1989)(citations omitted). Moreover, where a party has failed to object to apparent inconsistencies in the verdict form before the jury is discharged, that party has waived any objections to inconsistencies under Fed. R. Civ. P. 49(b). See White v. Celotex Corp,, 878 F.2d 144, 146 (4th Cir. 1989), cert. denied, 493 U.S. 964 (1989); Diamond Shamrock Corp, v, Zinke & Trumbo, Lid., 791 F.2d 1416, 1422 (10th Cir. 1986), cert. denied, 479 U.S. 1007. The court finds that the jury verdict does not contain any inconsistencies. The mere fact that the jury did not find that the patents were invalid for misuse or inequitable conduct (interrogatories 2 and 10), is not irreconcilable with the jury’s conclusion that Ogilvie wrongfully asserted its patents which Ogilvie knew, or should have known, were invalid (interrogatories 18, 22- 24). While these jury interrogatories and responses do involve misuse of patents, the jury’s response to interrogatory 10 found that the "718 patent was not rendered invalid for misuse. In contrast, the latter interrogatories of the jury verdict, 18, 22-24, dealt with whether Ogilvie had wrongfully asserted its patent rights despite knowing of the patent claims’ invalidity. The court finds the jury’s 33a responses to these interrogatories are consistent. Accordingly, the court finds the jury’s verdict to be reconcilable.’ B. Ogilvie’s Motion for Judgment as a Matter of Law Ogilvie moves the court to vacate the portion of the judgment against Ogilvie and to grant judgment as a matter of law on all counts of the complaint and counterclaim under Fed. R. Civ. P. 50, on grounds that Ogilvie proved by a preponderance of the evidence that Manildra and Honan infringed the patent claims in issue both literally and under the doctrine of equivalents. Ogilvie further contends that Manildra failed to establish by evidence which is clear and convincing that the patent claims in issue are invalid. Finally, Ogilvie contends that Manildra failed to establish the requisite elements proving a violation of the Lanham Act and its State tort claims. Before addressing the merits of Ogilvie’s motion for judgment as a matter of law, the court will review the factual background giving rise to the claimed inventions of the patent claims-in-issue. The carbonless copy paper industry has been in existence since at least the early 1960s. During the early periods of the industry, carbonless copy paper was manufactured using Solka- Floc as the primary stilt material. By 1970, the primary stilt * Furthermore, the court finds that Ogilvie has waived any objections regarding the alleged inconsistency. Following the reading of the verdict, the court granted Ogilvie’s request for additional time during which to study the verdict in order that Ogilvie could object to any inconsistencies. After carefully reviewing the verdict of the jury, Ogilvie did not make any such objections prior to the discharge of the jury. a material employed in the manufacture of carbonless copy paper was arrowroot starch which was grown and produced only on the island of St. Vincent located in the West Indies. Arrowroot starch was used in the carbonless copy paper industry because of its uniform particle size which is large enough to serve as a stilt material. In early 1971, a shortage of arrowroot starch arose. The evidence produced at trial revealed that arrowroot growers had stopped producing arrowroot starch during the years immediately preceding the shortage due to a history of large surpluses which resulted in extremely low prices and narrow profit margins. However, in early 1971, the arrowroot surplus was exhausted and it became apparent to the St. Vincent Arrowroot Association that they would not be able to meet the immediate demands of the manufacturers who supplied the carbonless copy paper industry with arrowroot starch. See Trial Exhibit 106. Upon receiving this formal notice on February 26, 1971, or immediately prior thereto, A. E. Staley ("Staley"), the original patent holder, set about finding a suitable substitute. Within a few weeks, Staley had produced fractionated large-granule wheat starch which it offered to its carbonless copy paper customer, National Cash Register ("NCR"), as a suggested substitute stilt material. 1. Patent Validity With respect to its claims that the jury’s verdict of invalidity must be set aside, Ogilvie contends that Manildra’s entire defense of patent invalidity was based upon Manildra’s allegations that the inventions described by the patent claims were either obvious or were anticipated by “prior art” thereby rendering the patents invalid under 35 U.S.C. §§ 102 and 103. Ogilvie contends that it is entitled to judgment of validity as a matter of law on these claims. Sa Among the basic elements required for an alleged invention to be patentable are that the invention disclose something "new" or “novel” and that the claimed invention is "non-obvious” to a person having ordinary skill in the pertinent art at the time the invention was made. See 35 U.S.C. §§ 102 and 103. On these issues, as well as all other attacks on the validity of a patent, the challenger must establish invalidity by evidence which is clear and convincing. Hybritech, Inc. v. Monoclonal Antibodies, Inc,, 802 F.2d 1367, 1375 (Fed. Cir. 1986), cert. denied, 480 U.S. 947 (1987). Also factored into this equation is the statutory presumption of validity 35 U.S.C. § 282. Hybritech, Inc, ,802 F.2d at 1375. In determining whether a claimed invention is obvious, various inquiries must be made. These include: the scope and content of the prior art; differences between the prior art and the claimed invention; and the level of ordinary skill in the pertinent art. Graham v. John Deere Co,, 383 U.S. 1, 17 (1966). Other factors which are to be considered, known as “secondary factors" or objective evidence of obviousness or non-obviousness, include: commercial success, long-felt but unsolved need, failure of others in attempting to invent a similar product or process, etc. Id. Stratoflex, Inc. v. Aeroquip Corp., 713 F.2d 1530, 1538-39 (Fed. Cir. 1983). Evidence of secondary considerations is frequently the “most probative and cogent evidence in the record. It may often establish that an invention appearing to have been obvious in light of the prior art was not.” Id., at 1538. Based upon a careful review of the evidence admitted at trial, and in view of the statutory presumption of validity and the prohibition of using hindsight to read the invention into the prior art, the court finds that substantial evidence supports the jury’s finding of invalidity of the patent claims-in-issue on the basis of obviousness and for lack of novelty of claims 24-27 of the °725 patent. 36a a. The Invention The patent claims-in-issue of United States Patent 3,901,725 ("’725 patent"), claims 1, 2, 3, 8, 9, 10, 16, 17, 18, 19, 24, 25, 26 and 27, teach the fractionation of bimodal cereal starch (including wheat starch) into two monomodal fractions containing primarily large-granule or small-granule starch particles. The process and product taught by the claims-in-issue involve a wet process employing hydrocyclone separating devices in two distinct steps. The first step begins with the input of prime grade wheat starch which has been washed and is substantially free of gluten and fiber.‘ This prime grade wheat starch is injected into the first set of hydrocyclones producing an overflow containing primarily small starch particles and an underflow consisting mostly of large starch particles. See Trial Exhibit 902. The underflow is then recycled through another set of hydrocyclones and once again the underflow is collected. The underflow consists of classified large-granule wheat starch particles of relatively uniform size which are well Suited for use aS a protective coating in the manufacture of carbonless copy paper. The patent claims-in-issue of United States Patent 4,280,718 (""718 patent"), claims 1, 6, 7, 8, 9 and 10, involve the application of the large-granule starch product produced by the wet separation process claimed in the °725 patent as a protective coating on * In this regard, highly conflicting testimony, which now must be viewed in favor of Manildra, was offered from various witnesses regarding whether it was common knowledge in the cereal starch industry to start with a prime starch feed which was critical to the invention claimed in the '725 patent. 37a carbonless copy paper. Thus, this patent claims the invention of a "new use” for large-granule cereal starch. b. Prior Art The patents-in-suit had a long and tortuous path betore their issuance. Indeed, various claims of the ‘725 patent had been rejected on at least one occasion by the Patent Examiner on grounds of obviousness in view of a patent, namely the Fontein Patent, United States Patent 2,642,185,° issued on June 16, 1953, which claimed the use of hydrocyclones in a wet separation process to obtain various subfractions of starch particles based upon particle size.° Trial Exhibit 861. Thus, from the outset, the issuance of the claims-in-issue involved close questions which were ultimately resolved in favor of the applicants. > The goal of the Fontein Patent was to separate or refine cereal starch on the basis of particle size. The primary objective of the Fontein Patent was to "provide a method requiring a minimum of control and space which may be operated in a continuous manner to prepare high grade starch from wheat starch.” Trial Exhibit 861. ® In order to overcome the Patent Examiner’s rejection of the ’725 patent claims of hydrocyclonic fractionation of wheat startch, the patent applicants represented to the Patent Examiner the critical nature of the size limitations added to the claims-in-issue of the "725 patent. They also asserted the alleged “inventive concept” of beginning the classification process with a clean starch stream which is “substantially free of gluten and fiber." Based upon these two representations, the Patent Examiner ultimately allowed the patent claims-in-issue. 38a While much of the prior att which was introduced during the trial had been considered by the patent office, other relevant prior art had not. Therefore, the court finds no merit in Ogilvie’s contention that the only pertinent prior art relied upon by Manildra in seeking the invalidation of Ogilvie’s patents had already been considered and rejected by the patent examiners as invalidating prior art.’ Specifically, the court finds that an article published by Dr. W. T. Yamazaki, was not considered by the patent examiner as prior art. Trial Exhibit 1344. This publication revealed that wheat starch could be classified or fractionated into monodisperse large and small-granule fractions. Although Dr. Yamazaki’s article discussed an air centrifugation process, the article, nevertheless, reveals or teaches that wheat starch can be separated into subfractions of fairly uniform particle size which is important for its utilization in the carbonless copy paper industry.’ This publication ” Furthermore, the court notes that the validity of a patent obtained in ex parte proceedings before the PTO, can be challenged in court. Constant v, Advanced Micro-Devices, Inc., 848 F.2d 1560, 1564 (Fed. Cir.), cert. denied, 488 U.S. 892 (1988). While patents are presumptively valid, they are not conclusively valid and unchallengable. Id. * Furthermore, Ogilvie’s contention that Dr. Yamazaki’s work did not constitute prior art because it was inoperable does not have any merit with respect to this court’s consideration of his article as prior art for a determination of obviousness. In re Shepherd, 172 F.2d 560, 564 (CCPA 1949). Indeed, an inoperative or unworkable device or patent is part of the prior art for all that it teaches. See generally 2 Chisum, Patents § 5.03[3] at 5-113, n. 22 (citing numerous such holdings). In any event, the jury presumptively found that the classification process described by Dr. Yamazaki’s : | ” . | 39a disclosed a subfraction of large-granule wheat starch of relatively uniform particle size identical or similar to that of the large-granule starch particles claimed by the °725 patent.” Compare Trial Exhibit 1344, at 79, Fig. D with Trial Exhibit 902, Figure 4. Substantial evidence was admitted into trial that Dr. Yamazaki’s large-granule wheat fraction met the critical size limitations defined in the patent claims-in-issue. Moreover, Dr. Yamazaki’s work with regard to large- granule wheat starch is not secret prior art because he did not abandon, suppress or conceal, his work and its accomplishments. See 35 U.S.C. § 102(g); E.L. DuPont de Nemours and Co. v. Phillips Petroleum Co,, 849 F.2d 1430, 1437 (Fed. Cir.), cert. denied, 488 U.S. 986 (1988). The evidence supports a contrary conclusion. The record reflects that Dr. Yamazaki had publicly disclosed his large-granule wheat fraction in Trial Exhibit 1344 by presenting his paper at an annual conference. paper was operable. ® This prior art reference anticipates Ogilvie’s product claims in the ’725 patent, i.e., claims 24 through 27, and serves as a statutory bar to patentability pursuant to 35 U.S.C. § 102(b) because this work was performed more than twelve months prior to the filing of the patent application. In this regard, it is irrelevant whether Dr. Yamazaki realized the utility of large-granule wheat starch. See In re Shoenwald, _—S&s F.2d __, 1992 U.S.App. Lexis 10181 (May 12, 1992)("it is beyond argument that no utility need be disclosed for a reference to be anticipatory of a claim to an old compound."); In re Donohue, 632 F.2d 123, 126 n. 6 (CCPA 1980)("proof of utility is not a prerequisite to availability of a prior art reference under 35 U.S.C. § 102(b)"). 40a c. Differences from Prior Art 1. °725 Patent None of the pertinent prior art discloses the wet separation of a monomodal large-granule wheat fraction through the use of hydrocyclones beginning with a prime starch feed disclosed in the ‘725 patent." However, the Fontein Patent does teach the wet separation of various subfractions of wheat starch through the use of hydrocyclones in repeated cycles. One of the main distinctions between the Fontein Patent and the patent claims-in-issue of the '725 patent, is that the objective of the Fontein Patent was to obtain a fine or small-particle size fraction whereas the ‘725 patent seeks to obtain a large-granule fraction. In order to obtain these different objectives, the Fontein Patent teaches the recycling of the overflow, while the °725 patent teaches the recycling of the underflow. In contrast, the Yamazaki prior art, Trial Exhibit 1344, does not teach a wet separation process through the use of hydrocyclones. Rather, once prime starch is obtained by wet separation and sieving, the prime starch fraction is then air-dried and later subjected to a Series of separations or fractionation via air classification. The large-granule subfraction, $-6208, which was ultimately obtained ’° As previously discussed, supra, at note 4, whether it was common knowledge to those skilled in the art to start with a "clean Starch stream" was highly disputed. Now, viewing the evidence and reasonable inferences therefrom in the light most favorable to Manildra, the court concludes it would have been obvious to one of ordinary skill in the art to begin with a clean starch stream when attempting to further refine starch into various fractions. > ee 4la after numerous passes, met the particle size limitations contained in claims 24 through 27 of the 725 patent." Another Yamazaki publication, Trial Exhibit 2901, teaches the wet classification of various bimodal cereal starches, including wheat starch, by the use of a series of sieving devices or by air eleutriation in order to obtain a monodisperse particle size fraction. The process described in this article begins with a deproteinized starch sample. The prime starch is then passed through a series of sieves until various subfractions are obtained. 2. ’718 Patent With regard to the application of large-granule wheat starch in the carbonless copy paper industry, Manildra asserted the NCR Patent as invalidating prior art. The NCR patent discloses the use of cereal starches in combination with a binding material as a suitable coating in the manufacture of carbonless copy paper. The NCR Patent teaches that cereal starch is a superior stilt material over artificial stilt materials such as microscopic glass beads. The NCR Patent discloses a list of unfractionated cereal starches, including wheat starch, and describes their particle size distributions. The NCR Patent also rates their effectiveness as a suitable stilt material. Trial Exhibit 948, at 3, line 85. Unclassified wheat starch was rated below arrowroot, potato and sago starch. The NCR Patent further teaches that uniformity in particle size is '' In this regard, Dr. Yamazaki’s work described in Trial Exhibit 1344 was reduced to practice as demonstrated by his sample of $-6208, which was introduced at trial as Trial Exhibit 1359. Further, this reference, Trial Exhibit 1344, was enabling because it describes in relative detail how to obtain the large-granule starch fraction. 42a the requisite requirement for suitable stilt material, arrowroot possessing this quality in an unfractionated state. In contrast, the "718 claims-in-issue, claims |, 6, 7, 8, 9 and 10, teach the use of fractionated large-granule cereal starch (selected from wheat, barley and rye which naturally have a bimodal particle size distribution) obtained by wet separation in the manufacture of the carbonless copy paper. These claims also cover the use of a large-granule cereal starch possessing specific characteristics in particle size and other parameters as applied to the surface of carbonless copy paper. Trial Exhibit 948. d. Level of Ordinary Skill A person of ordinary skill in the art is “one who thinks along the line of conventional wisdom in the art and is not one who undertakes to innovate, whether by patient, and often expensive, systematic research or by extraordinary insights. . . .” Standard Oil Co, v, American Cyanamid Co,, 774 F.2d 448, 458 (Fed. Cir. 1985). “Reference to the educational background and experience of those actively involved in the art is proper in determining the level of skill.” Vandenberg v. Dairy Ecruip, Co., 740 F.2d 1560, 1566 (Fed. Cir. 1984). Other factors which may be considered include: (1) the educational level of the inventors; (2) the types of problems encountered in the art; (3) prior art solutions to those problems; (4) rapidity with which innovations are made; (5) sophistication of the technology; and (6) educational level of active workers in the field. Environmental Designs, Ltd. v, Union Oil Co, of Calif., 713 F.2d 693, 696 (Fed. Cir. 1983), cert. denied, 464 U.S. 1043 (1983)(citation omitted). Based upon the testimony received during trial, one of ordinary skill in the art at the time of the claimed invention would have been an individual with at least a bachelors degree in a 43a technologically relevant area such as chemistry, grain science, or chemical engineering and with several years experience in the starch refining industry or a closely related industry. Many of the numerous witnesses presented at trial by both sides, including some of the named inventors, expert and fact witnesses, had this type of background. As such, the ordinary level of skill may be properly characterized as high and extremely technical. e. Secondary Considerations of Obviousness Among the secondary considerations which must be considered when determining whether an invention is obvious are commercial success, longfelt but unsolved need, and the failure of others, etc. Graham, 383 U.S. at 17. Applying these factors to the evidence presented at trial leads to the conclusion that substantial evidence supports the jury’s conclusion of invalidity on grounds of obviousness. As previously recited above, the need for a substitute stilt material was not a longfelt but unsolved need. Prior to early 1971, an adequate supply of arrowroot starch was available to the producers of carbonless copy paper, and before that, Solka-Floc was used as a stilt material. Within only a month of learning that its only source of arrowroot starch had disappeared, A. E. Staley found a suitable substitute. Thus, although the technology existed for many years in the starch industry to refine or classify cereal starch into various subfractions, including large granule fractions, there was no incentive to classify large granule particles because there was no use for such monomodal large granule cereal starch. Accordingly, viewing the inferences in favor of the nonmoving party, substantial evidence supports the conclusion that the claimed inventions were obvious solutions to a new problem. See Chisum, aa 2 Patents § 5.05]1), at 5-399 n. 7, (for a Jist of citations addressing situations where the inventor’s solution is an obvious response to a new problem created by changes in the market). Furthermore, the NCR Patent teaches that cereal starch of uniform particle size is the best type of stilt material. The NCR patent also teaches the use of wheat starch as a potential source of stilt material. In view of this prior art, the invention of the "718 patent, L.e., use of a monomodal large-granule cereal starch as a stilt material, would have been obvious to one skilled in the art at the time of the alleged invention. With respect to commercial success, there is no question that Ogilvie’s fractionated large-granule wheat starch has met with significant commercial success in the carbonless copy paper industry. However, the record also supports the conclusion that the unique situation confronted by the carbonless copy paper market is largely responsible for the commercial success of the classified large-granule wheat starch product. As stated previously, the carbonless copy paper industry was a preexisting market which suddenly lost its only supply of cereal stilt material. Thus, the commercial success of this product was largely the result of a preexisting built-in market with no other alternatives. With respect to the failure of others, the record is highly conflicting. Substantial evidence exists in the record that Mid-west Grains (f/k/a Midwest Solvents) produced a sample of fractionated wheat starch within a short time after being asked to come up with a sample of classified wheat starch. Other than this, there is no record that others tried and failed to find a solution to the shortage of arrowroot starch as a stilt material. The jury presumptively resolved this disputed area in favor of Manildra."” Other factors which are relevant include licensing of the invention or acquiescence in the industry, copying, acclamation of the invention and simultaneous invention by others. Evidence 45a Careful examination of all of the above factors leads the court to conclude that substantial evidence, indeed evidence arising to the level of being clear and convincing, exists to support the jury’s conclusion that the claimed inventions are invalid on the basis of obviousness, as well as lack of novelty of claims 24-27 of the "725 patent. The technology to fractionate bimodal cereal starch existed since the 1950s; however, there simply was no demand for a monodisperse large-granule cereal starch product. Rather, the valuable subfractions of starch were those consisting of smaller particle sizes. The process for obtaining a large-granule cereal starch was an obvious modification of the Fontein Patent. Further, evidence which the jury found credible supports the conclusion that it would have been obvious to those skilled in the art to begin with a clean starch stream, j,¢,, deproteinized starch stream, substantially free of gluten and fiber, at the time of the alleged inventions. These factors combined with the high level of skill in the pertinent art and the nature of the problem presented to the starch industry and carbonless copy paper industry, lead the court to conclude that it would have been obvious to one skilled in the art of starch refining to combine the various references to obtain a cereal starch product which is similar to arrowroot in particle size and distribution which presented during the trial relevant to these factors was highly conflicting. For example, testimony was presented that Midwest had produced a large-granule wheat starch product prior to its obtaining a license from Ogilvie’s predecessor for a relatively modest price of approximately $300,000. Prior to receiving this license, inquiries of infringement had been directed at Midwest. Whether Midwest accepted the validity of the patents, or whether it purchased a license to avoid any litigation regarding the patents-in- suit, was unclear. In view of the undoubtedly high cost of this litigation, it appears that Midwest made a wise choice. 46a would serve as a Suitable substitute stilt material for arrow root starch." 2. Infringement of the Patent Claims-in-Issue Ogilvie also moves for judgment as a matter of law on the issue of infringement. Infringement is an issue of fact to be decided by the jury. Sun Studs, Inc, v, ATA Ecruip, Leasing, Inc,, 872 F. 2d 978, 986 (Fed. Cir. 1989); Moleculon Research Corp. v. CBS, Inc,, 793 F.2d 1261, 1269-70 (Fed. Cir. 1986), cert, denied, 479 U.S. 1030 (1987). On this issue, Ogilvie bears the burden to prove by a preponderance of the evidence that Manildra and Honan have infringed the patent claims-in-issue. Symbol Technologies, Inc, v. Opticon, Inc,, 935 F.2d 1569, 1574 (Fed. Cir. 1991). In the interest of economy, the court finds that much evidence was presented on this issue both supporting a finding of infringement and supporting a conclusion of non-infringement. The jury chose to believe the evidence supporting non-infringement. This court cannot say as a matter of law, considering all inferences in the favor of the nonmoving party, that Ogilvie was entitled to a judgment on the issue of infringement. Specifically, the court finds With regard to Manildra’s contentions of invalidity of the specific claims-in-issue on the basis of vagueness in violation of 35 U.S.C. § 112, the court finds that this was [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386005_1651%3A1. Public record. Not legal advice.