Petition for Writ of Certiorari — Acushnet Co. v. Callaway Golf Co.

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No. 09-___ 99-702 DEC 11 2009

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OFFICE OF THE CLen«

Hn the Supreme Court of the Anited States

ACUSHNET COMPANY,

Petitioner,

Vv.

CALLAWAY GOLF COMPANY,

Respondent.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

PETITION FOR A WRIT OF CERTIORARI

RICHARD L. STANLEY

Counsel of Record

HOWREY LLP

1111 Louisiana St.,

25% Floor

Houston, TX 77002

(713) 787-1400

HENRY C. BUNSOW

HowreEY LLP JOSEPH P. LAVELLE

525 Market Street, Howrey LLP

Suite 3600 1299 Pennsylvania Ave., NW

San Francisco, CA 94105 Washington D.C. 20004

(415) 848-4900 (202) 783-0800

December 11, 2009 Attorneys for Petitioner

WiLSON-EPeS PRINTING CO., INC. — (202) 789-0096 -— WAasHINGTON, D.C. 20002

QUESTIONS PRESENTED

This case epitomizes how the Federal Circuit

incorrectly reviews jury verdicts on the ultimate

legal issue of patent validity under 35 U.S.C.

§ 103(a). The district court treated the jury’s § 103

verdicts as factual findings, holding only “that

substantial evidence supports the jury’s verdict of

nonobviousness.” The Federal Circuit upheld the

jurys §103 verdicts solely because “substantial

evidence” supported an implicit finding that one

claim limitation was not in the prior art. The legal

issue, however, was whether the asserted claims

would have been obvious to one of ordinary skill

despite that one difference with the prior art. By

reviewing the verdicts only for substantial evidence,

no court ever independently addressed or decided the

ultimate legal question.

Thus, the following questions are presented:

1. Whether this Court should make clear that

no single finding on any of its underlying Graham

factors is dispositive of the ultimate legal conclusion

on invalidity, such that a court reviewing a jury's

§ 103 verdicts must always independently render its

own legal conclusion regardless of whether one or all

of the jury’s underlying findings are accepted as

adequately supported by the evidence?

2. Whether this Court should instruct that a

jury’s § 103 verdict necessarily identifies the jury’s

implicit findings on the disputed underlying factual

issues litigated at trial, but is entirely advisory as to

the ultimate legal conclusion on invalidity?

PARTIES TO THE PROCEEDING

Pursuant to Rule 14.1(b), the parties here and

in the proceeding in the U.S. Court of Appeals for the

Federal Circuit are listed.

Petitioner here and Defendant-Appellant

below is Acushnet Company.

Respondent here and Plaintiff-Appellee below

is Callaway Golf Company.

RULE 29.6 CORPORATE DISCLOSURE

STATEMENT

Acushnet Company is a_ wholly-owned

subsidiary of its parent, Fortune Brands, Inc., which

is a publicly held company.

TABLE OF CONTENTS

QUE LIN © UREN E TEE? ce cececcccsevovcsewvsenccssseounscoseees i

PARTIES TO THE PROCEEDING...................::s000008 li

RULE 29.6 CORPORATE DISCLOSURE

ENDER EEE SER A RISE AREF Oee ii

SURFER, BAP AAR Fe EU vases evevecesecesovsnsienssssnetecceveness Vv

SAE Ee FARE CRP RE ees esiiscnsnecsncseresivccereiscesssonas vi

PETITION FOR A WRIT OF CERTIORARI ............. 1

TT iis cicpincripitnncenccabenssccnadeiinestachinteinniies 2

FIT vcincssnastnacncnadsbeusctneninapsavascisebeutaneneyennie 2

STATUTORY PROVISION INVOLVED..................... 2

STATEMENT OF THE CASE .................::cccccesssresseees 2

A. Introductory Statement.................cccceeeeeeeeeeeees 2

B. The Relevant Golf Ball Technology ................. 7

) The Accused Golf Balls .................ceeeee 7

2. The Asserted Patent Claims.................. 8

3. eR BE Bi issincisnsentinnncianinveninnpetinhuste 10

C. The District Court Proceedinggs...................... 13

1. Pe Biter cnsecioncatihacatinsecihiiaiiatemmenaninaga 13

2 The Denial Of JMOL Post-Trial.......... 15

iil

IT.

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IV.

CONCLUSION

THIS COURT SHOULD REVIEW AND

CORRECT THE FEDERAL CIRCUITS

METHODOLOGY FOR REVIEWING

JURY OBVIOUSNESS HOLDINGS ..........

A JURY'S § 103 VERDICT

IDENTIFIES THE JURY’S IMPLICIT

FINDINGS ON ANY UNDERLYING

DISPUTED FACTUAL ISSUES, BUT

IS MERELY ADVISORY AS TO THE

JURY'S STATED LEGAL

EES ee a

AFFIRMANCE OF EVEN ALL OF A

JURY'S UNDERLYING FINDINGS

DOES NOT MANDATE THAT THE

REVIEWING COURT AFFIRM THE

JURY’S ULTIMATE LEGAL

i ccpaenen

THIS CASE PROVIDES AN

EXCELLENT VEHICLE FOR

DECIDING THE IMPORTANT ISSUES

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SOOO EEE EEE EEE EEE EEE EEE EEE EEEEEEEE EEE

INDEX TO APPENDICES

APPENDIX A: Opinion of the United States

Court of Appeals for the Federal Circuit,

reported at 576 F.3d 1331 (Fed. Cir. 2009).............. la

APPENDIX B: Order of the United States

District Court for the District of Delaware,

filed Nov. 10, 2008 (unreported) ..................0.00eceeees 37a

APPENDIX C: Judgment of the United

States District Court for the District of

Delaware, filed Dec. 19, 2007 (unreported)............ 40a

APPENDIX D: Order of the United States

District Court for the District of Delaware,

filed Nov. 10, 2008 (unreported) ...................s0cceeeees 44a

APPENDIX E: Memorandum Opinion of the

United States District Court for the District

of Delaware, filed Nov. 10, 2008, reported at

§23 F. Supp. 2d 388 (D. Del. 2008)......................... 9la

APPENDIX F: Text of 35 U.S.C. § 103(a) ............. 94a

TABLE OF AUTHORITIES

Page(s)

Cases

Anderson’s-Black Rock, Inc. v. Pavement

Salvage Co.,

I EE oon sc pnannwncunensnscnseunts 26

Cardiac Pacemakers, Inc. v. St. Jude

Medical, Inc.,

381 F.3d 1371 (Fed. Cir. 2004)...............c0cse00 25

Cordis Corp. v. Boston Scientific Corp.,

561 F.3d 1319 (Fed. Cir. 2009)................s0se00 25

Dann v. Johnson,

IG na nse sencerancncnnsoosnoenasenenen 26

Dennison Mfg. Co. v. Panduit Corp.,

Ee 3

Fresenius USA, Inc. v. Baxter Int'l, Inc.,

582 F.3d 1288 (Fed. Cir. 2009)........... 26, 32, 36

Graham v. John Deere Co.,

TG Pe BIE cutcnncsececccccnosencscenesccesone passim

Great Atlantic & Pacific Tea Co. v.

Supermarket Equipment Corp.,

I a. ssunenatnbononeners 26

Hewlett-Packard Co. v. Mustek Systems, Inc.,

340 F.2d 1314 (Fed. Cir. 20038)....................... 31

Honeywell Int'l Inc. v. Hamilton

Sundstrand Corp.,

370 F.3d 1131 (Fed. Cir. 2004)....................... 24

In re GPAC, Inc.,

57 F.3d 1573 (Fed. Cir. 1995).............ccccccsssees 37

In re Lockwood,

50 F.3d 966 (Fed. Cir.),

vacated, 515 U.S. 1182 (1995)................ 5, 6, 25

In re Peterson,

315 F.3d 1325 (Fed. Cir. 2003)....................... 37

In re Technology Licensing Corp.,

423 F.3d 1286 (Fed. Cir. 2005)....................0066 5

Kemin Foods, L.C. v. Pigmentos Vegetales Del

Centro S.A.,

464 F.3d 1339 (Fed. Cir. 2006)....................0.. 25

Kinetic Concepts, Inc. v. Blue Sky Med.

Group, Inc.,

554 F.3d 1010 (Fed. Cir. 2009)........... 26, 32, 36

LNP Engineering Plastics, Inc. v. Miller Waste

Mills, Inc.,

275 F.3d 1347 (Fed. Cir. 2001).............cccsseseee 25

MuniAuction, Inc. v. Thomson Corp.,

532 F.3d 1318 (Fed. Cir. 2008)....................... 35

Newell Companies, Inc. v. Kenney Mfg. Co.,

864 F.2d 757 (Fed. Cir. 1988)......................... 30

Vii

Ormco Corp. v. Align Tech., Inc.,

463 F.3d 1299 (Fed. Cir. 2006)....................... 37

Perkin-Elmer Corp. v. Computervision Corp.,

732 F.2d 888 (Fed. Cir. 1984)................... 28, 29

Pro-Mold and Tool Co. v. Great Lakes Plastics,

Inc.,

75 F.3d 1568 (Fed. Cir. 1996)......................... 38

Railroad Dynamics, Inc. v. A. Stucki Co.,

727 F.2d 1506 (Fed. Cir. 1984)...................000 30

Richardson- Vicks Inc. v. Upjohn Co.,

122 F.3d 1476 (Fed. Cir. 1997)................. 25, 30

Sakraida v. Ag Pro, Inc.,

I Ts ccssinnacensncosennecoeee 26

Sarkisian v. Winn-Proof Corp.,

688 F.2d 647 (9 Cir. 1982)................ 28, 29, 31

United States v. Adams,

a csstaduaebunn 26

Statutes

canna eabnbeee passim

Rules

Sa a apianenbiotalis 28, 29

TI I ss asapupecenneten 3, 29

No. 09-

Jn the Supreme Court of the United States

ACUSHNET COMPANY,

Petitioner,

Vv.

CALLAWAY GOLF COMPANY,

Respondent.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FEDERAL CIRCUIT

PETITION FOR A WRIT OF CERTIORARI

Petitioner Acushnet Company (“Petitioner” or

“Acushnet”) respectfully petitions for a writ of

certiorari to review the decision of the United States

Court of Appeals for the Federal Circuit holding that

Acushnet was not entitled to judgment as a matter of

law (“JMOL”) that eight asserted claims of four

related patents-in-suit were invalid for obviousness

under 35 U.S.C. § 103(a). After upholding those jury

verdicts, the Federal Circuit separately remanded

the case for a new trial due to irreconcilable jury

verdicts, which would have been avoided by a proper

grant of JMOL. Only the issues concerning the

proper judicial review of a jury’s § 103 verdicts are

implicated by this petition.

OPINIONS BELOW

The Federal Circuit’s opinion (App. la-36a) is

reported at 576 F.3d 1331. The Federal Circuit's

order denying Petitioners’ petition for rehearing and

rehearing en banc (App. 91a-93a) is unreported. The

district court’s order resolving the post-trial motions

is at App. 37a-38a, its judgment is at App. 39a, and

its injunction order is at App. 40a-43a. The district

court’s memorandum opinion (App. 44a-90a) is

reported at 523 F. Supp. 2d 388.

JURISDICTION

The Federal Circuit’s judgment was entered

on August 14, 2009. App. 3a. A timely combined

petition for rehearing and for rehearing en banc was

denied on October 6, 2009. App. 57a-59a. This

Court has jurisdiction pursuant to 28 U.S.C.

§ 1254(1).

STATUTORY PROVISION INVOLVED

This case concerns the proper methodology for

judicial review in a patent case where a jury returns

verdicts on the legal issue of patentability set forth

in 35 U.S.C. § 103(a), as reproduced at App. 94a.

STATEMENT OF THE CASE

A. Introductory Statement

In Graham v. John Deere Co., 383 U.S. 1, 17-

18 (1966), this Court held that “the ultimate question

of patent validity is one of law” while recognizing

that “the § 103 condition ... lends itself to several

basic factual inquiries.”

Under § 103, the scope and content of the prior

art are to be determined; differences between

the prior art and the claims at issue.are to be

ascertained; and the level of ordinary skill in

the pertinent art resolved. Against this

background the obviousness or

nonobviousness of the subject matter is

determined. Such secondary considerations as

commercial success, long felt but unsolved

needs, failure of others, etc., might be utilized

to give light to the circumstances surrounding

the origin of the subject matter sought to be

patented.

383 U.S. at 17-18. In KSR Int7 Co. v. Teleflex Inc.,

550 U.S. 398, 407 (2007), this Court reiterated the

Graham “framework” and emphasized that its

factors “continue to define the inquiry that controls.”

About 20 years after Graham, this Court

reminded the Federal Circuit to honor the

delineation under § 103 between the ultimate legal

issue and the underlying factual determinations. In

Dennison Mfg. Co. v. Panduit Corp., 475 U.S. 809,

811 (1986), this Court vacated a Federal Circuit

decision that had reversed a holding of obviousness

after a bench trial, noting that a district court’s

subsidiary factual determinations “at the least,

ought to be subject to [Fed. R. Civ. P. 52(a)]” and

expressly requesting “the Federal] Circuit’s informed

opinion on the complex issue of the degree to which

the obviousness determination is one of fact.”

On remand, then-Chief Judge Markey recited

his court’s understanding of how to differentiate

between the legal and factual aspects of the § 103

inquiry. Panduit Corp. v. Dennison Mfg. Co., 810

F.2d 1561 (Fed. Cir. 1987). The Federal Circuit

explained that “[a] § 103 determination involves fact

and law” but held that the ultimate “obviousness-

nonobvious” question is one of law:

With the involved facts determined, the

decision-maker confronts a ghost, ie., “a

person of ordinary skill in the art.” ... In light

of all the evidence, the decisionmaker must

then determine whether the patent challenger

has convincingly established ... that the

claimed invention would have been obvious at

that time to that person. ... The answer to

that question partakes more of the nature of

law than of fact, for it is an ultimate

conclusion based on a foundation formed of all

the probative facts. If itself a fact, it would be

part of its own foundation.

810 F.2d at 1566. Moreover, the Federal Circuit

agreed that this Court’s holding in Graham that “the

ultimate question of patent validity is one of law”

was rightly interpreted as meaning “that one

answering the § 103 question is drawing a legal

conclusion.” 810 F.2d at 1567.

Like all legal conclusions, that under § 103

rests on a factual evidentiary foundation. As

said in Graham, 383 U.S. at 17, the question is

determined “against” the “background” of

answers to factual inquiries—a description of

how legal questions are normally determined.

One effect of considering the § 103 question

one of law in this court is to facilitate a

consistent application of that statute in the

courts anc in the Patent and Trademark

Office (PTO).

Id. at 1567. Nevertheless, the Federal Circuit’s later

decisions have increasingly failed to adhere to the

proper division between “factual issues” and “legal

conclusions” when reviewing §103 judgments,

particularly in jury cases.

In 1995, the Federal Circuit upheld a right to

a jury in a declaratory judgment action to determine

patent validity. In re Lockwood, 50 F.3d 966 (Fed.

Cir.), vacated, 515 U.S. 1182 (1995). Dissenting from

the denial of rehearing en banc, Judge Nies

questioned the jury’s role after this Court’s holding

in Graham that obviousness is an issue of law.

[En] banc efforts to clarify the issue have been

unsuccessful, as this case itself illustrates. ...

Thus, this court invokes the standard of

review applicable to the ultimate issue of fact

or an ultimate issue of fact mixed with law

and applies it to an ultimate issue of law.

See 50 F.3d at 988-89 (Nies, J., dissenting) (footnote

omitted). Although this Court granted certiorari in

Lockwood, the petition was dismissed after

Lockwood withdrew his jury demand. See In re

Technology Licensing Corp., 423 F.3d 1286, 1288 &

n.1 (Fed. Cir. 2005).

Unlike the “right to a jury” issue in Lockwood,

this petition challenges how the Federal Circuit (or a

district court) reviews jury verdicts that decide only

the ultimate § 103 issue. However, Judge Nies’

dissent in Lockwood remains pertinent because she

had already recognized that the Federal Circuit’s

approach to reviewing such verdicts was in disarray:

Some panel opinions speak of de novo review

after accepting the presumed findings of fact.

Others reject the de novo standard. Still

others conflate the standard to whether a

“reasonable” jury could reach the verdict it

rendered.

50 F.3d at 989 (citations omitted). Since then, the

Federal Circuit has not resolved that fundamental

conflict on its own, and the confusion and

inconsistency within its § 103 precedent has become

even more pronounced and irreconcilable.

Now, over 20 years after Dennison, the

Federal Circuit needs more than a reminder to follow

Graham, it needs explicit guidance on how to do so in

jury cases. As the Federal Circuit stated in Panduit,

“(tlhe decisional process en route to a §1063

conclusion involves more than the fact inquiries in

Graham.” 810 F.2d at 1567. Yet, the Federal

Circuit’s recent § 103 decisions erroneously conflate

the jury's implicit findings on the Graham inquiries

into the ultimate legal conclusion. If the court holds

that substantial evidence supports the jury’s implicit

finding on a disputed factual issue, then the jury’s

verdict on the ultimate legal conclusion is simply

affirmed. Regardless of how the jury decided the

§ 103 issue, that truncated review cannot be the

extent of the proper judicial inquiry.

Unlike in KSR, where the Federal Circuit had

unduly raised the bar for proving invalidity under

§ 103, see 550 U.S. ‘at 419, the questions here apply

to every patent jury case involving § 103, no matter

which outcome is reached. Today, more patent cases

are being tried to juries, and virtually every such

case involves an assertion of invalidity under § 103.

Moreover, these issues apply equally to reviews of

jury verdicts by district courts and by the Federal

Circuit.

At best, the Federal Circuit’s inconsistent

approaches have created confusion and uncertainty

for litigants, district courts, and its own panels in

discerning how jury verdicts under § 103 are to be

reviewed. At worst, as in this case, the Federal

Circuit’s abbreviated review of § 103 verdicts only for

“substantial evidence” eliminates the independent

judicial determination of the ultimate question of

validity under §103 required by this Court’s

precedent. The time is overdue for this Court to

review this fundamentally incorrect approach.

B. The Relevant Golf Ball Technology

1. The Accused Golf Balls

Petitioner Acushnet is a Massachusetts-based

golf equipment manufacturer that has designed and

sold professional quality golf balls since 1932. For

decades, Acushnet’s Titleist® brand golf balls have

been known as “The No. 1 Ball in Golf.” Acushnet’s

accused products are its Pro V1, Pro V1*, and Pro

V1x golf balls (collectively, “the Pro V1 ball”) which

were its latest offerings in the Titleist® line of high-

quality golf balls.

First introduced in 2000, Acushnet’s Pro V1

balls have a “three-piece” construction, consisting of

a solid core and two cover layers. The inner cover is

a relatively hard blend of ionomers, while the outer

cover is a soft, castable polyurethane independently

developed and patented by Acushnet. See infra.

Since being introduced, Acushnet’s Pro V1 balls have

achieved an unprecedented combination of great

distance off the tee and soft “feel” around the greens.

See App. 46a-47a.

2. The Asserted Patent Claims

Respondent Callaway is a California-based

golf equipment manufacturer. In 2000, Callaway

introduced its first golf ball, called the “Rule 35” ball.

In 2003, Callaway acquired the “Sullivan” patents-

in-suit! by purchasing the assets of Spalding Sports

Worldwide, Inc., a bankrupt golf company that was

the original assignee. Before purchasing the patents,

Callaway had refused to take a license under them,

asserting that the ‘293 patent was invalid.

| The four related patents-in-suit and the asserted claims are

identified at App. 3a n.1. Because the Federal Circuit held that

a new trial was required on all asserted claims due to

irreconcilable jury verdicts, those claims are patentably

indistinct for purposes of this petition. See App. 24a-29a.

The four patents-in-suit have essentially the

same specifications and relate to multi-layer golf

balls that use polyurethane as the outer cover. The

earliest patent, the ‘293 patent, did not issue until

after Acushnet’s Pro V1 ball was introduced, so

Acushnet independently developed its products

without knowledge of the patents-in-suit. The other

three patents-in-suit were not even filed until after

the Pro V1’s introduction. All of the patents-in-suit

issued from continuation applications based on a

1995 Sullivan application, which was itself a

continuation-in-part of an earlier 1993 application.

However, Sullivan’s 1993 application did not disclose

a low-acid ionomer inner cover or a_ cast

polyurethane outer cover.

All of the asserted claims have limitations

directed to a three-piece golf ball having a core, an

inner cover made of a low-acid ionomer or ionomer

blend with a Shore D hardness of 60 or more, and a

polyurethane outer cover with a Shore D hardness of

64 or less. App. 4a-6a & n.2. “Shore D hardness”

refers to a hardness standard published by the

American Society for Testing and Materials. App.

6a. Claim 1 of the ‘293 patent is representative, and

is reproduced at App. 5a. See also App. 47a-51a.

While Callaway repeatedly mischaracterized

the patents-in-suit throughout trial as disclosing the

particular features that enabled the success of

Acushnet’s Pro V1 ball, the patents and their claims

contain no such teachings. Instead, the asserted

claims cover virtually every conceivable combination

of prior art cores, cover thicknesses, and

polyurethane outer covers that could fit within a

regulation-sized golf ball. On their face, therefore,

nothing in the asserted claims reveals whether or

how any particular combination within the claimed

ranges of golf ball components might achieve

unexpected results or be a commercially acceptable

ball.

3. The Prior Art

Three-piece golf balls (i.e., a core and two

cover layers) had been known in the art since the

1980’s. For example, the Nesbitt patent describes a

ball having a core, a hard inner cover of a low-acid

ionomer, and a soft outer cover made of a soft

ionomer. See App. 29a-30a. Similarly, the Proudfit

patent taught a three-piece ball with a core, an

ionomer-blend inner cover, and a relatively soft

balata outer cover. App. 9a n.3. Proudfit’s assignee

sold an Ultra Tour Balata (“UTB”) ball which

embodied the patent. Both the Proudfit patent and

the UTB ball met every limitation of the asserted

claims except the polyurethane cover. In that

regard, the Molitor ‘751 patent taught using a

polyurethane cover on either two-piece or three-piece

golf balls like Nesbitt or Proudfit. Id.

By the mid-1990’s, golf ball covers were

primarily balata, balata blends, ionomers, or

polyurethane. Skilled golfers preferred balata covers

for its desirable “spin” and “feel” properties, but

balata was not durable and cut easily. lonomer

resins were a synthetic substitute for balata and had

better cut resistance, but ionomers lacked balata’s

“spin” and “feel” characteristics. Polyurethane was a

soft, flexible material used on golf ball covers since

the mid-1970’s, but had difficulties in manufacturing

and durability.

That changed in 1994, when Acushnet

introduced the Titleist® Professional ball, which

used a new cast polyurethane cover instead of balata.

In August 1994, a patent issued to an Acushnet

research chemist, Dr. Wu, disclosing the castable

polyurethane material used on the Professional ball

and teaching that this improved polyurethane could

replace both balata and ionomer covers on golf balls.

Wu’s polyurethane material, made from a slow-

reacting curative, was significantly more durable

than prior polyurethanes and could be cast (as

opposed to injection or compression molded) into a

very thin cover layer.

Using Wu’s castable polyurethane cover, the

Titleist® Professional ball quickly became the most

favored ball on the PGA Tour. ‘Today, Acushnet’s Pro

V1 balls still use Wu’s castable polyurethane for its

outer cover. After Sullivan read Wu’s patent, he

experimented with castable polyurethane covers. In

November 1995, Spalding (ffiled Sullivan’s

continuation-in-part application adding castable

polyurethane as new matter. Spalding’s application

recognized, as taught by Wu, that polyurethane was

a useful substitute for ionomer and balata covers.

Indeed, after the Wu patent issued, four

different golf ball manufacturers—Acushnet,

Spalding, Callaway, and _ Nike/Bridgestone—

independently took the obvious step of trying such

castable polyurethane as a cover for multi-layer balls

like Proudfit and Nesbitt. Acushnet’s Pro V1 ball

succeeded. Callaway’s Rule 35 ball, although

accused of infringing the patents-in-suit, was

discontinued by 2003. Spalding, Sullivan’s employer,

never achieved a successful ball and eventually went

bankrupt. However, while Sullivan never made a

successful ball, he realized that golf ball designs

would change after Acushnet’s introduction of

castable polyurethane.

While Acushnet was independently developing

its Pro V1 ball using Wu’s polyurethane material,

Sullivan amended his pending patent application to

incorporate castable polyurethane covers’ to

encompass whatever future polyurethane-covered

ball might eventually be achieved. The resulting

claims covered virtually every combination of

standard golf ball components together with

polyurethane outer covers that were possible within

a regulation golf ball without disclosing which

combination might be successful. Such overbreadth

and failure to distinguish the prior art should have

been fatal to validity.

Sullivan’s invention notebook revealed that

his purpose had been to design a ball “generally

equivalent to [Nesbitt]” but using newer materials

unavailable to Nesbitt. In essence, Sullivan claimed

what he hoped to do but never achieved. Even if he

had, however, the substitution of newer, previously-

unavailable, and improved materials into existing

designs (such as using the polyurethane disclosed by

Wu as the outer cover of Nesbitt’s prior art ball) is

the type of routine and predictable development that

this Court specifically instructed in KSR is not

patentable. See 550 U.S. at 421.

C. The District Court Proceedings

Callaway filed this suit on February 9, 2006.

App. 45a. On November 20, 2007, the district court

issued its claim construction ruling, granted

Callaway’s summary judgment motion of no

anticipation, and denied Acushnet’s summary

judgment motion of invalidity for anticipation and

obviousness. App. 45a. Due to the breadth of the

asserted claims, which effectively covered any three-

piece golf ball with a polyurethane outer cover,

Acushnet stipulated to infringement. App. 45a. The

district court then bifurcated damages from liability.

App. 10a.

1. The Trial

Obviousness was tried to a jury starting on

December 3, 2007. Under Graham, the four factual

inquiries underlying the obviousness question are

the level of ordinary skill in the art, the scope and

content of the prior art, the differences between the

claimed invention and the prior art, and any relevant

secondary considerations. See 383 U.S. at 17. Here,

most of those factual issues were not disputed.

The level of ordinary skill in the art was

undisputed. Acushnet’s expert testified that such

person had experience in golf ball and/or cover

design, generally understood ball materials and

construction, and knew the relevant prior art.

Callaway offered no contrary definition, and neither

party raised that issue post-trial.

The scope and content of the prior art was also

undisputed. The jury was instructed that the

relevant art included: (1) the Nesbitt patent, (2) the

Molitor “751 patent, (3) the Molitor ‘637 patent, (4)

the Proudfit patent, (5) the Wu patent, (6) the

Professional ball, and (7) the UTB bali. Acushnet’s

invalidity position was that the asserted claims

would have been obvious in view of the three-piece

balata ball of the Proudfit patent or the UTB ball

together with polyurethane cover taught by Molitor

“751 and/or Wu.

The only disputed factual issues concerned an

alleged difference between the claimed invention and

the prior art, and whether there was a motivation to

combine the cited references. To have some

difference to advance before the jury, Callaway

argued that no prior art disclosed a polyurethane

outer cover on a golf ball that was below Shore D 64

hardness. App. 16a-20a. However, Callaway most

heavily relied on alleged “secondary considerations”

based on Acushnet’s own commercial success and

unexpected results achieved by the specific design

that Acushnet developed and introduced in the

accused Pro V1 ball.

Because Acushnet had conceded infringement,

Callaway’s strategy was to equate Acushnet’s Pro V1

balls to the claimed invention, insisting before the

jury that the asserted claims taught the “right

combination” from amid the infinite “unpredictable”

claimed combinations. On their face, however, the

asserted claims did no such thing; they contain no

limitations to any unique, unexpected, or critical

performance criteria that could possibly distinguish

the prior art. The misleading nature of Callaway’s

trial presentation made it even more critical that the

reviewing courts independently reviewed the § 103

question as one of law.

2. The Denial Of JMOL Post-Trial

On December 14, 2007, the jury returned

interrogatories holding dependent claim 5 of the ‘293

patent invalid as obvious, but holding that the other

eight asserted claims were not proven invalid. App.

10a. The district court recognized that the verdicts

were inconsistent, but declined to order further

deliberations. App. 25a-26a. The court then entered

judgment for Callaway that facially adopted the

jury’s inconsistent verdicts. App. 39a.

Acushnet renewed its JMOL motion of

obviousness on the eight claims that had not been

invalidated and alternatively moved for a new trial.

Callaway did not seek JMOL of nonobviousness on

the one claim that the jury held was invalid. On

November 10, 2008, the district court denied

Acushnet’s post-trial motions (App. 44a-90a) and

permanently enjoined Acushnet from making and

selling the Pro V1 balls at issue during trial. App.

40a-43a.

The district court’s post-trial opinion

highlights the analytical errors that are rampant

under the Federal Circuit’s obviousness precedent.

According to the district court, it was Acushnet’s

burden “to prove obviousness at trial by clear and

convincing evidence” and it was Acushnet’s burden

on JMOL to “demonstrate that the verdict of

nonobviousness was not supported by substantial

evidence.” App. 56a. The district court was incorrect

on both counts.

A defendant's burden applies to the facts

underlying its invalidity defense, not the ultimate

legal conclusion. Once the facts are established by

whatever quantum of proof may be required, the

appropriate legal conclusion is drawn from those

facts. Simply put, a legal conclusion is not proven by

clear and convincing evidence, and the “substantial

evidence” standard of review should not apply when

reviewing that conclusion. Instead, only the

underlying factual findings are reviewed for

substantial evidence to establish the factual

background upon which the court's legal conclusion

is independently drawn.

Nevertheless, in denying JMOL, the district

court reviewed the jury’s nonobviousness verdicts

only for “substantial evidence.”

[Acushnet] must show the absence of facts

necessary to support a_ verdict of

nonobviousness, such that no reasonable jury

could conclude that defendant failed to meet

its high burden of proof. Such showing is

nearly unattainable in view of the fact that

[Callaway] presented its own rebuttal expert,

Dr. Risen, who testified regarding both the

scope and content of the prior art and the lack

of a motivation to combine, a question of fact.

App. 56a-57a. The district court identified and

upheld three disputed facts that the jury implicitly

resolved in Callaway’s favor.

First, the district court held that the jury

could have found that Acushnet’s evidence showing

the claimed Shore D hardness limitation in the prior

art fell short of clear and convincing. App. 57a-60a.

In other words, a reasonable jury could have found

that the claimed Shore D hardness limitation

constituted a difference with the prior art for

purposes of Graham.

Second, the district court held that a jury

could have reasonably “concluded” that a person of

ordinary skill would not have been motivated to put

a polyurethane cover on the Proudfit ball with any

expectation of success. App. 60a-62a. The court also

upheld an implicit finding that the golf ball art was

“unpredictable’ in that a designer would not know in

advance what performance would result from any

particular combination of ball materials, cover

hardnesses, and layer thicknesses. App. 62a-64a.

Ignoring that the patents-in-suit provided no such

guidance, the court credited Callaway’s expert's

testimony that there would have been no motivation

to combine Proudfit with either Molitor or Wu. App.

64a-65a.

Third, the district court cited Callaway’s

evidence of secondary considerations of

nonobviousness, which consisted primarily of

Acushnet’s own commercial success with its accused

Pro V1 balls. App. 65a-66a. According to the district

court, Acushnet’s infringement stipulation was

sufficient to establish a prima facie case that a nexus

existed between the commercial success and the

patented invention. App. 65a n.11.

In conclusion, the district court reiterated

“that substantial evidence supports the jury’s verdict

of non-obviousness.” App. 68a. Moreover, the court

declared that it did not need to consider Acushnet’s

evidence because the jury was free to resolve the

conflicting expert testimony in favor of Callaway.

App. 68a. Thus, the district court concluded that “a

reasonable jury could have found that defendant

failed to meet its clear and convincing burden on

invalidity.” App. 69a.

D. The Federal Circuit’s Decision

The Federal Circuit began by stating that

“{ajlthough the ultimate question of obviousness is a

legal issue reviewed de novo, the underlying findings

of fact (whether implicit or explicit within the jury’s

verdict) are reviewed from substantial evidence.”

App. 15a (citation omitted). However, the Federal

Circuit never reached the ultimate legal issue.

Instead, the Federal Circuit merely agreed

“that, when viewed in the light most favorable to the

verdict, the jury could have reasonably concluded

that Acushnet failed to prove invalidity due to

obviousness.” Jd. On its face, that approach of

reviewing “in a light most favorable to the verdict”

and deciding what “the jury could have reasonably

concluded” represents how courts review jury fact

findings, not how the courts draw legal conclusions

from established facts.

The Federal Circuit’s § 103 analysis consisted

of deciding only that “[t]he evidence before the jury

did not compel a finding that all claim limitations

were present in the prior art.” App. 16a. Under

Graham, that is just one of the underlying factual

inquiries, 1.e., identifying the differences between the

prior art and the claimed invention. See 383 U.S. at

17-18. Once any differences have been established

as a matter of fact, then the relevant legal conclusion

must be drawn by deciding whether overcoming the

identified differences would have been obvious to one

of ordinary skill in the art. However, the latter

inquiry was never conducted in this case.

The Federal Circuit seemingly accepted

Callaway’s argument that “the jury could have

rationally concluded that [the cited] combinations

did not in fact disclose or render obvious all

limitations of the asserted claims.” App. 16a.

However, that position completely blurs the critical

distinction between the factual and legal components

of the obviousness inquiry. Any question of whether

the jury could “rationally conclude” that the cited

prior art combinations did not “in fact” disclose all of

the claim limitations is the third factual inquiry

under Graham. However, the separate question of

whether the cited prior art combinations would have

rendered the claimed cor :bination obvious is neither

a question of fact nor something to be reviewed

merely for what a rational jury might have decided.

Here, the Federal Circuit only affirmed the

jury’s implicit finding that the prior art did not

disclose a polyurethane outer cover on a golf ball that

was below 64 on the Shore D hardness scale. App.

16a-20a. At most, that finding should have become

just one established fact upon which the ultimate

legal conclusion was drawn. Instead, after upholding

that one finding, the Federal Circuit’s obviousness

analysis simply stopped:

In summary, whether the prior art

disclosed the necessary hardness limitation

claimed in the Sullivan patents was an issue

of fact genuinely contested before the jury.

The district court did not err in concluding

that substantial evidence supports the jury’s

implicit resolution of that factual issue in

Callaway’s favor.

App. 20a. No other implicit findings were reviewed.

No other undisputed facts were mentioned. No

independent analysis of the appropriate legal

conclusion to be drawn from those established and

undisputed facts was ever made. As a matter of law,

that cannot be how federal courts are allowed to

apply this Court’s precedent requiring that the

ultimate invalidity determination be rendered as a

legal conclusion by the court.

REASONS FOR GRANTING THE PETITION

The Federal Circuit needs this Court’s

instruction on how to review a jury verdict on the

ultimate legal issue of obviousness under 35 U.S.C.

§ 103(a). As explained herein, the Federal Circuit

does not maintain the critical distinction between

reviewing a jury’s presumed but implicit underlying

factual findings and independently deciding the

ultimate legal conclusion based on the undisputed

facts and any jury findings supported by substantial

evidence. Thus, not only are courts not rendering an

independent judicial decision on the ultimate validity

issue as required by this Court’s precedent, but the

Federal Circuit’s review methodology has become so

fundamentally flawed that this Court’s guidance and

correction is required.

This Court should make clear that the judicial

role in reviewing a jury’s § 103 verdicts (whether on

JMOL or appeal) requires more than simply deciding

whether one or even all of the jury’ underlying

findings are supported by substantial evidence.

Instead, the proper judicial inquiry is a two-step

process where the second step requires the court to

render its own legal conclusion based on the facts

established by the jury’s supported findings. In this

case, as in many others decided under the Federal

Circuit’s flawed approach, the second step is simply

not being done.

Here, the Federal Circuit only affirmed that a

reasonable jury could have found a difference

between the claimed invention and the prior art, and

then affirmed the district court’s acceptance of the

jurys nonobviousness verdicts on that basis.

However, the mere fact that one or more claim

limitations are not in the prior art does not

invariably require a conclusion of nonobviousness.

Regardless of that finding, both the district court and

the Federal Circuit were obligated to decide de novo

(i.e., without deference to the jury’s § 103 verdicts)

whether, despite that difference, the asserted claims

were invalid for obviousness.

As this Court settled in Graham, obviousness

is a question of law. Yet, in its own words, the

Federal Circuit merely agreed “that, when viewed in

the light most favorable to the verdict, the jury could

have reasonably concluded that Acushnet failed to

prove invalidity by clear and convincing evidence.”

Tab A, at 12. That review methodology is wrong for

at least three reasons.

Unlike a jury’s resolution of the disputed facts,

a jury’s ultimate legal conclusion (1) should never be

reviewed in a light most favorable to the verdict, (2)

should never be reviewed from the perspective of a

reasonable jury, and (3) is not itself a fact to be

proven by clear and convincing evidence. Under

Graham, obviousness is not a factual question, and a

jury verdict on that ultimate legal question should

never be reviewed only for substantial evidence.

Once a jury’s findings are reviewed to establish the

facts, the reviewing court must then render its own

legal conclusion of “valid” or “invalid”— regardless of

whether the jury’s conclusion could be deemed

plausible or reasonable.

The jury’s § 103 verdict necessarily identifies

its presumed fact findings, but cannot be binding as

to its stated legal conclusion. Moreover, the

reviewing court’s acceptance of any or all of a jury’s

findings on the disputed underlying factual issues

cannot relieve that court from rendering its own

legal conclusion on patent validity without regard to

the jury’s or the lower court’s conclusion. This Court

in Graham rendered its own legal conclusion on the

ultimate § 103 issues by disagreeing with the

contrary conclusions of the lower courts without

remanding or describing any underlying finding as

“clearly erroneous.” By itself, Graham establishes

that both the district court and the Federal Circuit

cannot simply uphold one or some of the jury’s

findings and then affirm the jury’s verdict without

ever independently analyzing and deciding the

ultimate legal issue on validity.

Those fundamental errors in the Federal

Circuit’s methodology for reviewing § 103 verdicts

are not unique to this case and clearly warrant this

Court’s review. Moreover, by correcting the Federal

Circuit’s improperly truncated approach, this Court

will provide much needed guidance regarding the

correct “fact vs. law” distinctions under § 103 that

will affect not only JMOL motions, but motions for

summary judgment, jury instructions, and jury

interrogatories. Because differentiating between the

factual and legal aspects of the obviousness inquiry

implicates virtually every litigated patent case, there

may be no more important doctrinal issue in the

Federal Circuit’s precedent in need of review and

clarification by this Court.

I. THIS COURT SHOULD REVIEW AND

CORRECT THE FEDERAL CIRCUIT'S

METHODOLOGY FOR REVIEWING

JURY OBVIOUSNESS HOLDINGS

As the Federal Circuit itself explained 20

years ago, at the express direction of this Court, the

§ 103 inquiry requires resolving any disputes on the

underlying factual issues and then making the

separate legal conclusion on the ultimate invalidity

issue. See Panduit, 810 F.2d at 1566-69. In a jury

case, the jury does only the first step while the court

(whether trial or appellate) should be the one that

does the second. Unfortunately, as in this case,

many Federal Circuit and district court decisions

since Panduit incorrectly treat obviousness as a

factual question, review the conclusion only for what

a reasonable jury might decide, or assume upholding

any factual finding requires acceptance of the jury’s

legal conclusion.

Because obviousness is a question of law,

there should be no such thing as a jury “finding” on

obviousness, nor is there any basis for holding that a

jurys § 103 verdict is supported by “substantial

evidence.” However, the Federal Circuit has

repeatedly rendered such _ holdings. See, e.g.,

Honeywell Intl Inc. v. Hamilton Sundstrand Corp.,

370 F.3d 1131, 1145-46 (Fed. Cir. 2004) (en banc) (we

agree “there is substantial evidence to support the

jury’s finding of nonobviousness”). Moreover, such

improper holdings cannot be disregarded as merely

loose language or dicta.2 In light of such Federal

Circuit precedents, many district courts, like the one

in this case, are incorrectly reviewing § 103 verdicts

only for substantial evidence.

As noted, the Federal Circuit had begun by the

mid-1990’s to invoke the “clearly erroneous” or

“substantial evidence” standards of review that

should have been applicable only to issues of fact

when reviewing the ultimate legal issue of validity

under § 103. See Lockwood, 50 F.3d at 988-89 (Nies,

J., dissenting). However, the current Federal Circuit

has elevated that mistaken approach into that

court's standard review methodology. See, e.g.,

Kemin Foods, L.C. v. Pigmentos Vegetales Del Centro

S.A., 464 F.3d 1339, 1344 n.2 (Fed. Cir. 2006) (“[o]ur

cases ...have applied the substantial evidence

standard to general jury verdicts on obviousness,

..and PIVEG has not pointed to any contrary

authority”). However, the contrary authority resides

2 See, e.g., Cordis Corp. v. Boston Scientific Corp., 561 F.3d

1319, 1322 (Fed. Cir. 2009) (“there was substantial evidence

that these prior art patents did not render claim 36 obvious’);

Cardiac Pacemakers, Inc. v. St. Jude Medical, Inc., 381 F.3d

1371, 1378 (Fed. Cir. 2004) (“The record contains substantial

evidence whereby a reasonable jury could have reached the

verdict that it would not have been obvious ... [i]n view of this

evidentiary support, the district court’s grant of JMOL cannot

stand.”); LNP Engineering Plastics, Inc. v. Miller Waste Mills,

Inc., 275 F.3d 1347, 1353 (Fed. Cir. 2001) (“the record supplies

substantial eviaence for a reasonable jury to find that claim 1

... would have been obvious”); Richardson v. Suzuki Motor Co.,

868 F.2d 1226, 1237 (Fed. Cir. 1989) (“Our review shows that

there was substantial evidence on which reasonable jurors

could have concluded that claim 9 had not been proved invalid

for obviousness, and thus reached the verdict of ‘valid.”).

in Graham and this Court’s other invalidity decisions

where this Court has consistently drawn its own

independent legal conclusion from the undisputed

and established facts.

This problem is consistently surfacing and will

not be resolved without this Court’s intervention, In

Kinetic Concepts, Inc. v. Blue Sky Med. Group, Inc.,

554 F.3d 1010, 1020 (Fed. Cir.), cert. denied, 2009

WL 2493730 (Nov. 17, 2009), the Federal Circuit

affirmed a nonobviousness judgment merely upon

upholding a jury’s finding that the prior art did not

disclose one claim limitation (“treating a wound with

negative pressure”). As in this case, the Federal

Circuit held that “this was sufficient to support the

jury’s verdict of non-obviousness.” Jd. As in this

case, however, the accepted finding in Kinetic

Concepts merely identified one difference with the

prior art, a factual inquiry under Graham. Thus, as

in this case, the mere existence of a difference with

the prior art should not have been dispositive nor the

end of the judicial § 103 inquiry.

More recently the Federal Circuit in

Fresenius USA, Inc. v. Baxter Intl, Inc., 582 F.3d

1288 (Fed. Cir. 2009), reviewed a district court’s

grant of JMOL of nonobviousness that reversed a

jury’s obviousness verdicts. For five different sets of

3 See, e.g., Sakraida v. Ag Pro, Inc., 425 U.S. 273, 280 (1976);

Dann v. Johnson, 425 U.S. 219, 230 (1976); Anderson’s-Black

Rock, Inc. v. Pavement Salvage Co., 396 U.S. 57, 62-63 (1969);

United States v. Adams, 383 U.S. 39, 51 (1966); Great Atlantic

& Pacific Tea Co. v. Supermarket Equipment Corp., 340 U.S.

147, 153-54 (1950).

asserted claims, the Federal Circuit again treated

the existence of substantial evidence supporting the

jury’s implicit factual finding that a particular claim

limitation was in the prior art as being dispositive of

the ultimate legal conclusion. See id. at 1297-1300

(“[b]ecause substantial evidence supports the jury’s

implicit finding, JMOL was inappropriate”). Once

again, whether or not the jury’s “differences with the

prior art” findings were supported, they cannot be

dispositive of the ultimate legal conclusion. More

importantly, the mere existence of differences with

the prior art should not have allowed the Federal

Circuit to avoid independently deciding the legal

issue of whether it would have been obvious to

overcome the identified differences.

The petition for a writ of certiorari in the

Kinetic Concepts case asked this Court to decide

whether a defendant “has a right to independent

judicial, as distinct from lay jury, determination of

fobviousness].” See Medela AG v. Kinetic Concepts,

Inc., No. 09-198 (filed Aug. 13, 2009). While that

petition correctly recognized the problem, the

petition likely proposed an overbroad solution—

eliminating the jury entirely from deciding issues of

patent validity. However, the real problem stems

not from allowing a jury to resolve disputed facts, but

from the Federal Circuit’s error in allowing the jury’s

legal conclusion to be insulated from independent

judicial review under the guise of applying

“substantial evidence” and “reasonable jury”

standards of review.

The more modest solution posed by the

present petition—without any Seventh Amendment

concerns—is for this Court to instruct the Federal

Circuit and district courts regarding how to identify

and review te implicit factual findings within a

jury’s § 103 verdict without abdicating the court’s

independent responsibility to ensure that the

statutory standards for patentability have been

satisfied. By doing so, this Court will be able to

reaffirm that the ultimate “obvious” or “nonobvious”

decision is a legal conclusion to be made by the

reviewing court based on the undisputed and

established facts.

Il. AJURYS § 103 VERDICT IDENTIFIES

THE JURY'S IMPLICIT FINDINGS ON

ANY UNDERLYING DISPUTED

FACTUAL ISSUES, BUT IS MERELY

ADVISORY AS TO THE JURY’S STATED

LEGAL CONCLUSION

As demonstrated by this Court’s approach in

Graham, the court must decide the ultimate legal

issue, even in jury cases. However, in Perkin-Elmer

Corp. v. Computervision Corp., 732 F.2d 888, 895 n.5

(Fed. Cir. 1984), the Federal Circuit rejected the

view “that a jury verdict on nonobviousness is at best

advisory.” The Federal Circuit specifically disagreed

with Sarkisian v. Winn-Proof Corp., 688 F.2d 647,

651 (9th Cir. 1982), which allowed a jury to decide

obviousness but characterized a jury’s verdict on the

ultimate issue as being “a nonbinding advisory

opinion.” The Federal Circuit declared that the

Ninth Circuit’s view “would make charades” of

motions under Fed. R. Civ. P. 50 in patent cases. See

732 F.2d at 895 n.5.

Despite the Federal Circuit’s concerns in

Perkin-Elmer about patent cases not being different

from other civil cases, it overlooked that the Ninth

Circuit’s “advisory opinion” was properly limited to

the jury’s ultimate conclusion, not to its underlying

findings. The Ninth Circuit agreed that this Court’s

Graham factors were to be decided by the fact finder,

preferably by detailed special interrogatories in jury

trials or by detailed findings in nonjury trials. See

732 F.2d at 650. In contrast to the Federal Circuit’s

current confusion, the Ninth Circuit also understood

that the appropriate standard of appellate review

depended upon which portion of the obviousness

inquiry is at issue.

The predicate factual determinations are

reviewed under the appropriate standard for

findings of fact. If made by the jury, we

review for support by substantial evidence. ...

We review a judge’s findings under the clearly

erroncous test. Fed. R. Civ. P. 52(a).

The ultimate conclusion of obviousness ...is a

question of law. It is subject to our

independent review.

688 F,2d at 651. Thus, nothing in Sarkisian

intruded upon a jury’s traditional role of factfinding

or made a “charade” of post-trial motions under Rule

50. Indeed, it is the Federal Circuit’s current

practice of treating a jury’s Graham findings as

dispositive of the ultimate legal conclusion that

causes the post-trial JMOL motion to become a

charade rather than a true judicial decision.

This Court should resolve the conflict between

Sarkisian and Perkin-Elmer by holding that a jury’s

§ 103 verdicts are not advisory only to the extent

that they identify the jury’s underlying findings that

determine the factual “background” upon which the

court’s ultimate legal conclusion is to be drawn.

Where a jury returns a general verdict, all disputed

factual issues are presumed to have been decided in

favor of the verdict winner. But once those findings

are identified and reviewed, the jury’s § 103 verdict

on the ultimate legal conclusion is necessarily

advisory because, as in Graham, the reviewing court

must draw its own legal conclusion from the

established facts no matter how the jury itself

decided the invalidity issue.4

Properly understood, a jurys § 103 verdict is

not advisory as to its findings (even if they are

implicit), but is advisory and entitled to no weight or

deference on its ultimate legal conclusion (even

though explicitly stated). In the absence of special

interrogatories, a jurys § 103 verdict simply serves

4 Earlier Federal Circuit decisions correctly recognize that

distinction. See, e.g., Richardson-Vicks Inc. v. Upjohn Co., 122

F.3d 1476, 1479 (Fed. Cir. 1997) (“That an obviousness

determination stands upon the relevant facts does not convert

the ultimate conclusion of obviousness from one of law into one

of fact.”); Newell Companies, Inc. v. Kenney Mfg. Co., 864 F.2d

757, 763 (Fed. Cir. 1988) (“it is not the function of the jury to

pick and choose among established facts relating to obviousness

in contrast to its obligation to sift through the conflicting

evidence to determine what those facts are”); Railroad

Dynamics, Inc. v. A. Stucki Co., 727 F.2d 1506, 1515 (Fed. Cir.

1984) (“the judge must remain the ultimate arbiter on the

question of obviousness”).

as shorthand to identify how the jury must initially

be presumed to have resolved the underlying

disputed issues of fact.

One solution would be to require juries to

answer special interrogatories on the disputed

factual issues in patent cases. Like the Ninth

Circuit in Sarkisian, 688 F.2d at 650, the Federal

Circuit has encouraged that procedure, e.g., Hewlett-

Packard Co. v. Mustek Systems, Inc., 340 F.2d 1314,

1325 (Fed. Cir. 2003), but has never required it. One

inherent difficulty is that the underlying factual

issues for obviousness, particularly those related to

secondary considerations, are not always “yes-no”

questions that lend themselves to “fill in the blank”

jury interrogatories. Nevertheless, if litigants and

district courts were required to identify the disputed

factual issues for the jury, a jury would not need to

answer the ultimate question, the parties and the

reviewing court would know which factual disputes

had been resolved in favor of which party, and the

court could render its own legal conclusion based on

the actual findings, not just presumed ones.

Like most patent jury cases, that is not what

happened here, but that cannot absolve the courts

from properly reviewing the verdicts. Here, the

Federal Circuit presumed from the nonobviousness

verdicts that the jury accepted Callaway’s factual

assertion that the prior art did not show

polyurethane outer covers with a hardness below

Shore D 64 on a three-piece ball. The panel then

decided that a jury could have reasonably made that

finding. App. 18a-20a. Based on that one single

finding, the Federal Circuit then affirmed the denial

of JMOL without addressing whether the affected

claims would have been obvious despite that minor

difference in light of the clear teachings and explicit

suggestions in the prior art. Such judicial deference

to a jury’s ultimate § 103 conclusion should no longer

be allowed or perpetuated by this Court.

Iii, AFFIRMANCE OF EVEN ALL OF A

JURY’S UNDERLYING FINDINGS DOES

NOT MANDATE THAT THE REVIEWING

COURT AFFIRM THE JURY’S

ULTIMATE LEGAL CONCLUSION

As in Graham, even if every underlying

finding is accepted, the reviewing court is free to

disagree with the jury’s conclusion, and must always

consider the ultimate legal question itself and

without deference. This Court should grant this

petition to hold that a jury’s verdict on the ultimate

§ 103 invalidity issue can be reversed even if every

underlying finding is upheld. The Court should also

hold that no single finding on any Graham factor,

including secondary considerations, is dispositive of

the ultimate legal issue. Even the Federal Circuit’s

own precedent holds that all probative facts must be

considered before a court renders its ultimate legal

conclusion, See Panduit, 810 F.2d at 1569-71. Yet

here, as in Kinetic Concepts and Fresenius, the

Federal Circuit looked at just one.

Unlike some other mixed fact-and-law

questions, the appropriate legal conclusion under

§ 103 will not follow automatically from the findings

on the Graham factors. For example, the proper

legal conclusion on negligence follows directly from a

jurys findings on the four underlying factual

elements (duty, breach, proximate cause, and

damage). If each element is found as a matter of

fact, there is negligence as a matter of law. If any

element is absent, there is no negligence as a matter

of law. In contrast, even after a jury’s findings on

the Graham factors are identified and reviewed, the

legal conclusion based on those established facts

must be independently decided by the reviewing

court, and could be different from that reached by

the jury or a lower court.

For example, a patentee will try to prove as a

matter of fact that there are multiple differences

with the prior art while the defendant tries to show

there are few or none. Whatever the outcome,

resolution of those factual disputes merely provides

the backdrop for the court’s legal conclusion rather

than determines it. Even when differences with the

prior art exist, a defendant can still prove that the

claimed invention :vould have been obvious as a

matter of law despite such differences.

The required legal analysis cannot be different

where any differences with the prior art are resolved

by a jury rather than being undisputed. Indeed, an

affirmance of a jury’s finding establishes that fact as

no longer in dispute, but cannot end the court’s § 103

analysis. Yet, that is exactly what happened here.

The Federal Circuit held that “substantial evidence

supports the jury’s implicit resolution” of whether

the prior art disclosed a polyurethane outer cover

with a hardness below Shore D 64 on a three-piece

ball. App. 20a. At that point, the Federal Circuit’s

§ 103 analysis simply stopped. Jd.

Had the district court or the Federal Circuit

done the complete legal analysis, the undisputed

facts and the governing post-KSR law should have

compelled the ultimate legal conclusion that, despite

no express example in the prior art of a polyurethane

cover hardness below Shore D 64 on a three-piece

ball, the asserted claims are invalid. Proudfit’s soft,

three-piece, balata-covered ball met each limitation

but a polyurethane cover (App. 9a n.3), while other

cited prior art references taught substituting

castable polyurethane for balata, taught using

polyurethane and non-polyurethane covers with

hardness below Shore D 64, taught the desirability of

a relatively soft outer cover on a three-piece ball, and

taught as routine how to vary cover hardness. See

Acushnet Br. 11-15, 34. Even the Federal Circuit’s

analysis shows that the single difference found with

the prior art was truly miniscule. See App. 16a-20a

& n.8.

The Federal Circuit’s summary of the prior art

confirms that, as of Sullivan’s alleged invention,

three-piece golf ball designs and polyurethane covers

were well-known, App. 9a n.3, and Acushnet’s Dr.

Wu had just disclosed a new, castable polyurethane

specifically for use as a golf ball cover that prompted

the inventor to amend his pending applications and

caused multiple ball manufacturers to follow her

suggestion to substitute the new polyurethane

material onto existing ball designs. Where there is

but one difference over the closest prior art and

where there was an express motivation to combine, a

combination of well-known components being used

for their established function should be unpatentable

as a matter of law. See 550 U.S. at 418.

While Callaway stressed the _ alleged

“unpredictability” of achieving the right combination

out of the countless claimed permutations of

ordinary golf ball components, a proper application of

the law would not have allowed such arguments to

preserve the validity of the asserted claims. First,

contrary to Callaway’s premise, the asserted claims

have no limitations directed to any unexpected

results or unique performance criteria to distinguish

the prior art. See MuniAuction, Inc. v. Thomson

Corp., 532 F.3d 1318, 1328 n.5 (Fed. Cir. 2008)

(claims “broad enough to read on obvious subject

matter are unpatentable even though they also read

on nonobvious subject matter”). Absent such

limitations, the claims are nothing more than a

straightforward combination of well-known prior art

golf ball components.

As this Court made clear in KSR, where a

technique improves one device and one of ordinary

skill would recognize that it would improve similar

devices in the same way, using that technique to

improve the prior art is not patentable. 550 U.S. at

407. However, no court in this case has undertaken

this Court’s KSR analysis. Instead, both the district

court and the Federal Circuit simply accepted the

jury’s verdicts as supported by substantial evidence

without ever independently deciding whether the

ultimate legal conclusion based on those facts

comported with the controlling law.

Iv. THIS CASE PROVIDES AN EXCELLENT

VEHICLE FOR DECIDING THE

IMPORTANT ISSUES PRESENTED

Because the Federal Circuit has remanded

this case for a new trial, its interlocutory posture

might initially appear to weigh against granting

review at this time. However, a more important

consideration is that this case presents its important

doctrinal questions in an appropriate context for this

Court’s review. Moreover, there is nothing to be

gained by waiting any longer for self-correction by

the Federal Circuit.

The error inherent in the Federal Circuit’s

review methodology is cleanly presented by its

affirmance of the denial of JMOL based solely on a

single jury fact finding. Not only is that issue case

dispositive, but the Federal Circuit’s recent decisions

in Kinetic Concepts and Fresenius demonstrate that

the challenged methodology is not an exception but is

the rule in that court. Finally, there may never be a

clearer instance where the alleged secondary

considerations lacked any nexus to the invention as

actually claimed and thus were more misused before

the jury en route to a legally-flawed outcome.

By affirming the denial of JMOL of

obviousness merely by upholding the one difference

over the prior art, the Federal Circuit did not reach

the final disputed Graham factor, i.e., secondary

considerations. Nevertheless, because correction of

the Federal Circuit’s truncated review methodology

also implicates those issues, this case provides an

excellent vehicle by which this Court should reaffirm

its holding in Graham that secondary considerations

provide “legal inferences” that are “more susceptible

of judicial treatment than are the highly technical

facts often present in patent litigation.” See 383 U.S.

at 35-36.

As noted, Callaway’s efforts to preserve the

validity of the asserted claims at trial relied almost

exclusively on the commercial success and

unexpected results achieved by Acushnet’s accused

Pro V1 balls. Here, such allegations should not have

supported any legal inference of nonobviousness

because Callaway’s evidence lacked any “nexus” to

the broadly claimed subject matter.5 See In re

Peterson, 315 F.3d 1325, 1330-31 (Fed. Cir. 2003)

(one or even a small number of species yielaing

unexpected results cannot support claims to a much

broader range). Such overbroad claims should never

have survived a court correctly applying the

controlling law, but as yet, no court has done the

proper legal analysis.

Moreover, despite Graham, the Federal

Circuit also incorrectly treats “nexus” as a factual

issue for the jury. See, e.g., Pro-Mold and Tool Co. v.

Great Lakes Plastics, Inc., 75 F.8d 1568, 1574 (Fed.

5 See, e.g., Ormco Corp. v. Align Tech., Inc., 463 F.3d 1299,

1311-12 (Fed. Cir. 2006) (“Evidence of commercial success, or

other secondary considerations, is only significant if there is a

nexus between the claimed invention and the commercial

success.”); In re GPAC, Inc., 57 F.3d 1573, 1580 (Fed. Cir. 1995)

(“For objective evidence to be accorded substantial weight, its

proponent must establish a nexus between the evidence and the

merits of the claimed invention.”).

Cir. 1996). As with the other Graham factors, the

Federal Circuit thus confuses the factual components

with the legal component and improperly defers to a

jury’s implicit findings on secondary considerations

and nexus, when this Court has instructed that such

matters may give rise only to a “legal inference” that

should be reserved for judicial weighing en route to a

court rendering its ultimate legal conclusion.

More importantly, this petition raises issues of

fundamental importance that directly implicate most

pending and future patent cases apart from the

particular dispute between these parties. To be sure,

the parties’ dispute is of considerable importance

even on its own. The accused Pro V1 balls are the

world’s leading golf balls, and, if infringement

liability were to be established, the alleged damages

are well in the hundreds of millions of dollars.

Absent this Court’s review, the district court

will necessarily conduct a second trial. No matter

which side prevails, the court will surely again

review the resulting verdicts merely for substantial

evidence in the manner that the Federal Circuit has

just employed and approved. No matter which party

prevails, the other side will likely challenge the

review methodology all the way to this Court. Not

only would such proceedings be costly to the parties

and the judicial system, but a large number of other

patent jury cases will also be tried and incorrectly

reviewed during the intervening period.

There is nothing to be gained by waiting for

further developments. The issues are squarely

presented. Now is the time and this is the case in

which this Court should review and correct the

Federal Circuit’s flawed methodology for reviewing

jury verdicts under § 103.

CONCLUSION

The petition for writ of certiorari should be

granted.

Respectfully submitted.

RICHARD L. STANLEY

Counsel of Record

Howrey LLP

1111 Louisiana St., 25%

Floor

Houston, TX 77002

(713) 787-1400

HENRY C. BUNSOW

HOwREY LLP JOSEPH P. LAVELLE

525 Market Street, HowrREY LLP

Suite 3600 1299 Pennsylvania Ave., NW

San Francisco, CA 94105 Washington D.C. 20004

(415) 848-4900 (202) 783-0800

December 11, 2009 Attorneys for Petitioner

APPENDIX

APPENDIX A

UNITED STATES COURT OF APPEALS FOR

THE FEDERAL CIRCUIT

2009-1076

CALLAWAY GOLF COMPANY,

Plaintiff-Appellee,

ACUSHNET COMPANY,

Defendant-Appellant.

Frank E. Scherkenbach, Fish & Richardson

P.C., of Boston, Massachusetts, argued for plaintiff-

appellee. With him on the brief was Thomas L.

Halkowski, of Wilmington, Delaware.

Henry C. Bunsow, Howrey LLP, of San

Francisco, California, argued for defendant-

appellant. With him on the brief were Joseph P.

Lavelle and Kenneth W. Donnelly, of Washington,

DC, and Richard L. Stanley, of Houston, Texas. Of

counsel on the brief were Edward A. Pennington and

Amanda M. Rettig, Hanify & King, PC, of

Washington, DC.

Appealed from: United States District Court for the

District of Delaware

Judge Sue L. Robinson

UNITED STATES COURT OF APPEALS FOR

THE FEDERAL CIRCUIT

2009-1076

CALLAWAY GOLF COMPANY,

Plaintiff-Appellee,

ACUSHNET COMPANY,

Defendant-Appellant.

Appeal from the United States District Court for the

District of Delaware in case no. 06-CV-091, Judge

Sue L. Robinson.

DECIDED: August 14, 2009

Before LINN, DYK, and PROST, Circuit Judges.

DYK, Circuit Judge.

Callaway Golf Company ("Callaway") brought

suit against Acushnet Company ("Acushnet"),

alleging that Acushnet had infringed various claims

of four golf ball patents owned by Callaway (known

as the "Sullivan patents").! Acushnet stipulated that

its golf balls infringed, but contended that the

asserted claims were invalid for anticipation and

obviousness. After construing the claims, the district

court granted summary judgment of no anticipation.

Callaway Golf Co. v. Acushnet Co., 523 F. Supp. 2d

388, 407 (D. Del. 2007) ("Summary Judgment

Order"), vacated in part by 585 F. Supp. 2d 600 (D.

Del. 2008) ("JMOL Order"). Following a trial on

obviousness, the jury determined that—with the

exception of dependent claim 5 of the '293 patent—

none of the asserted claims was invalid. The district

court entered final judgment concluding that

dependent claim 5 of the '293 patent was invalid for

obviousness, but that independent claim 4 (from

which it stemmed), as well as the other seven

asserted claims, were not.

We conclude that Acushnet raised a genuine

question of material fact concerning anticipation,

and we reverse the district court's entry of summary

judgment on that issue and remand. As _ to

obviousness, we affirm the _ district court's

determination that Acushnet was not entitled to

judgment as a matter of law that the asserted claims

are invalid for obviousness. But because the

judgment on _ obviousness was based upon

irreconcilably inconsistent jury verdicts, we vacate

1 The four Sullivan patents are U.S. Patent Nos. 6,210,293

("293 patent"), 6,503,156 ("156 patent"), 6,506,130 (130

patent"), and 6,595,873 ("873 patent"). At issue are claims 1, 4,

and 5 of the '293 patent, claims 1-3 of the '156 patent, claim 5 of

the '130 patent, and claims 1 and 3 of the '873 patent.

the judgment of the district court and remand for a

new trial. Thus, for the reasons that follow, we

affirm-in-part, reverse-in-part, vacate-in-part, and

remand for a new trial.

BACKGROUND

Callaway and Acushnet are golf equipment

manufacturers. Callaway is the current owner of the

Sullivan patents, which share nearly identical

specifications and contain similar claims to a multi-

layer polyurethane-covered golf ball. Historically,

golf balls designed to travel long distances when

struck by a driver were relatively hard. JMOL Order,

585 F. Supp. 2d at 605. In contrast, golf balls

designed to exhibit other desirable playability

characteristics (such as spin control for approach

shots, and the proper "click" and “feel” upon being

struck) typically were softer. Id. According to the

specification, a major advantage of the patented

invention is that it presents a "dual personality" ball

that is capable of travelling great distances, yet does

not exhibit diminished playability or durability. See

'293 patent col.5 11.23-30; id.col.3 11.21-29.

As shown below in Figure 2 of the '293 patent,

the patented golf ball contains a core 10 and a multi-

layer cover consisting of a first or inner layer 14 and

a second or outer layer 16. '293 patent col.5 11.51-52.

The first or inner cover layer is preferably made of a

blend of low-acid ionomer resins, while the second or

outer cover layer is made of a relatively soft

polyurethane material. Id. col.5 11.35-54 & col. 6 1.56-

col.7 18.

FIG. 2

Claim lof the '293 patent is generally representative

of the asserted claims:

1. A golf ball comprising:

a core;

an inner cover layer having a Shore D

hardness of 60 or more molded on said core,

said inner cover layer neiyes a thickness of

0.100 to 0.010 inches, inner cover layer

comprising a blend of aan or more low acid

ionomer_ resins containing no more than

16% by weight of an alpha, beta-

unsaturated carboxylic acid;

and an outer cover laver having a Shore D

hardness of 64 or less molded on said inner

cover layer, said outer cover layer having a

thickness of 0.010 to 0.070 inches, and said

outer cover laver comprising a relatively

soft polyurethane material.

'293 patent col. 23 ll. 48-61 (emphases added).

Callaway's other asserted claims vary slightly from

claim 1 of the '293 patent, but each claims a golf ball

with a core, an ionomer resin (or iouomer blend)

inner cover layer with a Shore D hardness of 60 or

more, and a polyurethane outer cover layer with a

Shore D hardness of 64 or less. "Shore D hardness"

refers to a hardness standard published by the

American Society for Testing and materials.”

Callaway sells or previously sold several lines of golf

balls that practice the patented’ technology.

Summary Judgment Order, 523 F. Supp. 2d at 393.

Callaway sued Acushnet ffor patent

infringement on February 9, 2006, in the United

States District Court for the District of Delaware.

The accused products are the Titleist Pro V1, Pro

V1*, and Pro V1x golf balls, which Acushnet

introduced to the market in 2000, 2002, and 2003

respectively. The Pro Vl has a_ three-piece

construction consisting of a solid core, an ionomer-

blend inner cover, and a polyurethane outer cover.

The Pro V1* (since discontinued) and Pro V1x balls

are "dual-core" balls having an inner core, an outer

2 The standard, ASTM D-2240, describes a method of testing

hardness by forcing an indentor into the material to be tested.

The indentor's penetration into the material under specified

conditions indicates the relative hardness of the material. The

standard describes several standard sizes of indentors (type A,

B, C, D, etc.), with “Shore D” hardness referring to hardness

measured using a size "D" indentor. American Society for

Testing and Materials, Standard Test Method for Rubber

Property-Durometer Hardness 1 (1995) ("ASTM D-2240").

core, an ionomer inner cover, and a polyurethane

outer cover.

On November 20, 2007, the district court

construed various disputed terms of the Sullivan

patents, including the term "cover layer having a

Shore D hardness." The parties agreed that as a

general proposition "Shore D hardness" refers to a

durometer measurement of a material's hardness

rated on the Shore D hardness scale, which is

described in the ASTM D-2240 standard. They

disagreed, however, as to whether the Sullivan

patent claims refer to the hardness of the cover layer

as measured on a golf ball, or the hardness of a

sample of the cover layer material measured off the

ball. As the district court noted, the parties' experts

testified that mumerous factors (such as_ the

composition of the layer under the material being

tested) can affect the measured hardness of a

material. Thus, on-the-ball and off-the-ball hardness

measurements of the same cover material can differ.

JMOL Order, 585 F. Supp. 2d at 610 & n.6;

Summary Judgment Order, 523 F. Supp. 2d at 399 &

n.1l.

The district court held that the claim

limitation "[c]over layer having a Shore D hardness"

requires that the Shore D hardness measurement of

the cover layer be taken on the ball. Callaway Golf

Co. v. Acushnet Co., No. 06-CV-091, 2007 WL

4165415, at *I (D. Del. Nov. 20, 2007) ("Markman

Order"). Based on this on-the-ball construction,

Acushnet stipulated that its Titleist Pro V1 bail

infringed all of the asserted claims, and that its Pro

Vil* and Pro Vlx balls infringed all claims except

claim 1 of the '293 patent.

iil

Thereafter Acushnet focused its defense on

the issues of anticipation and obviousness, moving

for summary judgment of invalidity on those

grounds. With regard to anticipation, Acushnet

argued that the text of U.S. Patent No. 4,431,193

("Nesbitt") itself discloses a three-piece golf ball

meeting all limitations of the Sullivan patents save

two: a polyurethane outer cover and a blend of

ionomers in the inner cover. Callaway apparently

does not dispute this. Acushnet argued that Nesbitt

incorporates by reference U.S. Patent No. 4,274,637

(“Molitor '637”), which teaches both polyurethane

and ionomer blends as cover materials and, Acushnet

maintains, inherently discloses the necessary

hardness limitations for those cover layers. Thus,

according to Acushnet, when properly viewed as a

single reference, Nesbitt/Molitor anticipates the

Sullivan patents as a matter of law. In support of its

anticipation argument, Acushnet also prepared test

golf balls combining the polyurethane outer cover

described by Molitor '637 with the core and ionomer-

blend inner cover of Nesbitt and _ proffered

measurements of the resulting balls. Callaway filed a

cross motion for summary judgment of no

anticipation (and opposed Acushnet's motion),

arguing that Nesbitt did not incorporate Molitor '637

and thus failed to disclose the necessary Shore D

hardness limitation.

On November 20, 2007, the district court

granted Callaway's motion for summary judgment

that Nesbitt does not anticipate as a matter of law.

Summary Judgment Order, 523 F. Supp. 2d at 398:.

The court held that "Nzsbitt does not describe the

use of polyurethane or blends of ionomer resins in

Molitor '637 with sufficient particularity to effectuate

an incorporation by reference of those features." Id.

Based on this holding, the court also granted

summary judgment of no anticipation on the ground

that Nesbitt (without Molitor '637) does not disclose

a cover hardness of Shore D 64 or less. Id. at 400.

With regard to obviousness, Acushnet

contended that the various separate elements of the

Sullivan patents—including golf balls with multi-

layer covers, ionomer-blend covers, and polyurethane

covers—were all well known in the prior art.

Acushnet relied on Nesbitt, Molitor '637, and three

additional golf ball patents, U.S. Patent Nos.

4,674,751 (“Molitor '751”), 5,314,187 ("Proudfit"), and

5,334,673 ("Wu"),3 in support of its contention that

one of skill in the art would have had reason to

combine the prior art and would have had a

reasonable expectation of success. With regard to the

3 Proudfit teaches a three-piece golf ball with a core, an

ionomer-blend inner cover, and a relatively soft outer cover of

balata (a type of rubber). Proudfit col.6 11.19-27; id. col.12 11.47-

52. Molitor '751 teaches a polyurethane cover that may be used

on two-piece or three-piece golf balls. Molitor '751 col.3 11.7-12;

col.7 11.49-51. Wu teaches a golf ball with a single cover layer

made of polyurethane. Wu col.7 il.37-47.

10a

cover hardness limitation, Acushnet contended that

Molitor '751 discloses the required range (albeit

stated in terms other than “Shore D” hardness).

A jury trial limited to the question of

obviousness was held from December 5 to December

14, 2007. The jury returned a verdict concluding that

dependent claim 5 of the '293 patent was invalid for

obviousness, but the remaining eight claims

(including independent claim 4 of the '293 patent)

had not been proven invalid.4 On December 19, 2007,

the court entered judgment tracking the jury's

verdict. Trial on willfulness and damages was

stayed.

After denying Acushnet's renewed motion for

judgment as a matter of law on the eight claims held

not invalid, on November 10, 2008, the district court

issued a permanent injunction against Acushnet.

. Question 1 of the verdict form is reproduced in its entirety:

1. Has Acushnet proven, by clear and

convincing evidence, that any of the following

claims of U.S. Patent No. 6,210,293 (the '293

patent) is invalid due to obviousness?

"Yes" is a finding for Acushnet. "No" is a finding for Callaway.

(A) Claim 1 Yes___ No_X__

(B) Claim 4 Yes__. No_X__

JMOL Order, 585 F. Supp. 2d at 615. Questions 2, 3, and 4

were identical except for the patent and claim numbers, and for

each claim in those questions the jury marked "No." Id.

lla

JMOL Order, 585 F. Supp. 2d at 608-14, 622-23.

Acushnet timely appealed, and we have jurisdiction

under 28 U.S.C. § 1292(c)(1) and (2).

DISCUSSION

On appeal, Acushnet challenges five major

aspects of the proceedings before the district court.

We address each in turn.

I Claim Construction

Acushnet argues that the determinations that

the claims were not invalid were based upon a faulty

interpretation of the phrase "cover layer having a

Shore D hardness," which appears in each of the

asserted claims. Acushnet contends that the district

court's on-the-ball construction led it to improperly

reject Acushnet's invalidity arguments, which in part

depended on prior art disclosing the off-the-ball

hardness of polyurethane materials that can be used

to make golf ball covers. We review the district

court's claim construction de novo. Cybor Corp. v.

FAS Techs., Inc., 138 F.3d 1448, 1456 (Fed. Cir.

1998) (en banc). We generally assign to claim terms

"the meaning that the term would have to a person of

ordinary skill in the art in question at the time of the

invention." Phillips v. AWH Corp., 41 5 F.3d 1303,

1313 (Fed. Cir. 2005) (en banc).

Acushnet argues that the district court's claim

construction is erroneous because the specification

notes in several places that the hardness values

therein are “measured in accordance with ASTM

12a

method D-2240." '293 patent col.7 11.21-22.5 The

ASTM D-2240 standard states that hardness should

not be tested on a rounded or curved surface, which

Acushnet argues precludes measuring hardness on

the rounded and irregular surface of a golf ball.

ASTM D-2240, at 2. Thus, Acushnet contends, a

person of ordinary skill in the art would understand

"cover layer having a Shore D hardness" to mean the

hardness of a flat sample of the material used for the

cover layer at issue, tested off the ball.

We disagree. The Sullivan patents make clear

that, when read in context, the reference to ASTM D-

2240 does not require hardness of the cover layer to

be tested off the ball. To the contrary, the claims

speak of "[a] golf ball" with a "cover layer" having a

certain hardness, rather than focusing on the

hardness of the material used to create the cover

layer. E.g., '293 patent col.23 11.49-60. Likewise, the

specification points to the hardness of the assembled

ball (rather than of the cover materials in isolation)

as the relevant characteristic. E.g., id. col.5 11.7-8

("The hardness of the ball is the second principal

property involved in the performance of a golf ball."

(emphasis added)). While there are examples

providing off-the-ball measurements of commercially

available materials in the patent, the examples

directed to golf balls as opposed to starting materials

specifically disclose hardness measurements taken

See also '293 patent col.9 (Table 2, noting that "ASTM

Method" "D-2240" was used to test "Shore Hardness D"); id.

col.11 (Table 3, same); id. col.11 11.61-63 (noting Shore D

hardness was measured "per ASTM D-2240"); col.16 11.49-50

(same).

13a

on intermediate and finished balls. E.g., id. col.22

114 (Table 8, showing "Shore D" hardness

measurements on finished balls); see also id. col.17

11.36-37, 41 (Table 5, showing "Shore C Hardness" of

"Molded Intermediate Balis" with inner cover); id.

col.18 11.52-53, 57 (Table 6A, showing "Shore C

Hardness" of "Molded Finished Balls" with outer

cover in place); id. col.19 11.63, 66 (Table 6A, same).

These examples confirm that hardness was to be

measured on the ball.* Indeed, as the district court

noted, there is no “cover layer” to measure until a

golf ball is produced. Markman Order, 2007 WL

4165415, at *1.

Moreover, here there was evidence at trial

from Acushnet's own witnesses showing that those of

skill in the art typically took Shore D hardness

measurements on the ball. Jeff Dalton, for example-

Acushnet's Vice President of Product Development-

testified that the golf ball industry commonly

conducted hardness tests in substantial compliance

with ASTM D-2240, with the exception of the

requirement that the test not be conducted on the

ball: "[W]e-technical people in the golf ball industry

deviate from that standard by not measuring

[hardness] on the kind of test specimen that is called

for in ASTM [D-2240]. We generally measure it on

® Acushnet notes that some unasserted claims also specify a

flexural modulus for the cover layers, which must be measured

off the ball. See, e.g., '130 patent col.24 ll.1-2. Unlike modulus,

however, hardness can be measured on the ball, and as

discussed above, the patent makes clear that the claims refer to

on-the-ball measurement of hardness.

l4a

the ball." Trial Tr. 514:21-515:1 (emphasis added).?

Such evidence of accepted practice within the art,

when not at variance with the intrinsic evidence, is

relevant to the question of how a person of skill in

the pertinent field would understand a term. See

Phillips, 415 F.3d at 1318 ("[E]xtrinsic evidence in

the form of expert testimony can be useful to...

establish that a particular term in the patent or the

prior art has a particular meaning in the pertinent

field."); see also Symantec Corp. v. Computer Assocs.

Int'l, Inc., 522 F.3d 1279, 1289 n.3 (Fed. Cir. 2008).

The district court did not err in holding that the

phrase “cover layer having a Shore D hardness"

refers to an on-the-ball hardness measurement.

II Obviousness

The jury returned a verdict finding that eight

asserted claims of the Sullivan patents were not

invalid for obviousness. Acushnet contends that the

district court erred in failing to grant its motion for

judgment as a matter of law that the asserted claims

of the Sullivan patents would have been obvious.

We apply de novo the same JMOL standard

applied by the district court to the jury verdict. See

Caver v. Citv of Trenton, 420 F.3d 243, 262 (3d Cir.

2005); see also PharmaStem Therapeutics, Inc. v.

’ See also Trial Tr. 344:13-14 (Acushnet Senior Vice President

of Research and Development William Morgan noting that "it

was our standard practice at the time to measure the Shore D

hardness directly on the golf ball").

15a

Viacell, Inc., 491 F.3d 1342, 1359-60 (Fed. Cir. 2007).

2007). Although the ultimate question of obviousness

is a legal issue reviewed de novo, see KSR Int'l Co. v.

Teleflex Inc., 550 U.S. 398, 427 (2007), the

underlying findings of fact (whether implicit or

explicit within the jury's verdict) are reviewed for

substantial evidence, see Johns Hopkins Univ. v.

Datascope Corp., 543 F.3d 1342, 1345 (Fed. Cir.

2008). We agree with the district court that, when

viewed in the light most favorable to the verdict, the

jury could have reasonably concluded that Acushnet

failed to prove invalidity due to obviousness.

Acushnet frames the invention of the Sullivan

patents as nothing more than a predictable and

“obvious to try" variation of known elements (solid

cores, ionomer-blend covers, polyurethane covers,

and three-piece balls). See KSR, 550 U.S. at 416

(noting that a "combination of familiar elements

according to known methods is likely to be obvious

when it does no more than yield predictable results");

PharmaStem Therapeutics, 491 F.3d at 1360.

Callaway, in contrast, argues that such analysis is

inappropriate because the Sullivan patents disclose

more than a rearrangement of prior art elements

with each element predictably performing its same

function in the new combination. Rather, Callaway

contends that use of a soft polyurethane cover over a

hard ionomer inner cover and a solid core, a

construction not present in the prior art, "produce[s]

a synergy and an important new result" over and

beyond that which could be expected independently

from each prior art element: namely, a true dual-

personality ball. PI.-Appellee's Br. 28; see KSR, 550

16a

U.S. at 416 (noting prior-art elements "work[ing]

together in an unexpected and fruitful manner" as

indicia of nonobviousness).

The evidence before the jury did not compel a

finding that all claim limitations were present in the

prior art. At trial, Acushnet sought to establish

obviousness primarily through a combination of prior

art three-piece balls with non-polyurethane outer

covers (the ball taught by Proudfit and a similar ball

marketed by Wilson, the Ultra Tour Balata), with

the polyurethane covers of Wu or Molitor '751. JMOL

Order, 585 F. Supp. 2d at 607. Callaway argues that

the record contains ample evidence upon which the

jury could have rationally concluded that these

combinations did not in fact disclose or render

obvious all limitations of the asserted claims.

The Sullivan patent claims require the

polyurethane outer cover of the patented golf ball to

have a Shore D hardness, as measured on the ball,

no greater than 64. E.g., '293 patent col.5 11.48-61. It

is undisputed that none of the prior art references

upon which Acushnet relied expressly discloses the

requisite hardness limitation for a polyurethane golf-

ball cover on a three-piece ball. Lacking dizect

evidence of the claimed limitation, Acushnet instead

relied on indirect evidence to attempt to establish the

existence of the claimed hardness limitation in the

prior art. It first argued that Molitor '751, which

discloses a two-piece ball with a core and a

polyurethane cover, demonstrates the necessary

hardness because that patent's specification states

that the polyurethane-blend cover of the Molitor '751

17a

ball should have "a shore C hardness less than 85,

preferably 70-80, and most preferably 72-76."

Molitor '751 col.2 11.33-39 (emphasis added); id.col.7

11.65-68.

Callaway maintains that Molitor '751's

disclosure of a Shore C hardness is insufficient to

teach an on-the-ball Shore D hardness less than 64.

There is no dispute that a hardness measurement

taken with a size "C" indentor will vary from a

measurement of the same material taken with a size

“D” indentor; that is, a Shore C measurement cannot

be precisely converted mathematically into a Shore D

measurement or _ vice-versa. However, while

acknowledging that no simple linear relationship

exists between the two types of measurements,

Acushnet argues that one of skill in the art would

have understood that approximate comparisons can

be drawn between the scales. Indeed, Acushnet

argues, the Sullivan patents themselves contain

statements drawing such comparisons. E.g., '293

patent col.3 11.50-54 (describing layer that "has a

Shore D hardness of about 45 (i.e., Shore C hardness

of about 65)"). Acushnet thus contends that even if a

precise conversion between the scales is not possible,

a golf ball designer would have recognized that a

Shore C hardness of 72-76 would be something less

than Shore D 64. In support of this specific

comparison, it introduced the "comparison chart"

from the ASTM D-2240 _ standard ' = showing

approximate ranges for measurements taken with

different size indentors, as well as expert testimony

that Shore C 72-76 would be approximately Shore D

55.

18a

Although the jury could have accepted

Acushnet's argument that the Shore C range

disclosed in Molitor '751 would have been equivalent

to an on-the-ball hardness measurement no greater

than Shore D 64, we cannot say that as a matter of

law the jury was required to do so. Substantial

evidence supports the contrary position. Most

notably, the ASTM "comparison chart" upon which

Acushnet relied states plainly on its face that "[t]his

is not and cannot be used as a conversion reference."

ASTM D-2240, at 1. The standard further cautions

that "there may be no simple relationship between

the results obtained with one type of [indentor] and

those obtained with another type," undercutting

Acushnet's argument that a material measuring

Shore C 72 would necessarily measure 64 or less if

tested with a type D indentor. Id. see also Trial Tr.

1162:3-24 (testimony of Callaway's expert, Dr. Risen,

that accurate Shore C to Shore D conversions were

not possible).

Equally importantly, the Shore C range

disclosed by Molitor '751 indicates a _ desired

hardness measurement of the cover on a two-piece

ball, rather than on the cover of a three-piece ball

with a hard ionomer-resin inner cover layer.

Testimony at trial established that the hardness

8 To be sure, there was contrary evidence as well, including

examples of Shore C to Shore D comparisons in the Sullivan

patents and evidence, as noted above, that such a comparison

was made in the course of the patents’ prosecution. See, e.g.,

'293 patent col.3 11.51-53. This evidence, however, did not rise to

the level of an admission that an accurate conversion between

Shore C and Shore D is always possible.

19a

measurement of a material depends to some degree

on what is underneath the material being tested,

such that an on-the-ball measurement of a thin

polyurethane cover with a hard layer underneath is

likely to be harder than an _ off-the-ball.

measurement. Acushnet's witness, Jeff Dalton,

agreed that "what's underneatn the layer you're

measuring can also influence the measurement."

Trial Tr. 516:17-18; see also id. at 516:23-24

(agreeing that thin covers are more subject to such

influence than thick covers); id. at 517:1-12 (agreeing

that on-the-ball measurements are often harder than

off-the-ball measurements). Acushnet's expert, Dr.

Statz, similarly agreed that hardness measurements

could be impacted by a number of factors, including

thickness and the material composition of adjacent

layers. Trial Tr. 720:6-19; id.616:8-9 (noting that "the

hardness will go up in the case of a thinner layer on

another material"). The jury was entitled to

determine that the imprecision of the ASTM chart,

coupled with uncertainty as to how much additional

hardness would be imparted by a hard intermediate

cover layer, was sufficient to undermine Acushnet's

claim that the Shore C hardness of 72-76 present in

the prior art would necessarily translate to an on-

the-ball Shore D hardness no greater than 64 on a

three-piece, two-cover ball.

Second, Acushnet contended that the Wu

patent demonstrates the necessary hardness

limitation, because expert testimony established that

the polyurethane cover material it teaches has a

Shore D hardness of about 48 when measured off the

ball, or of about 56 when measured on the single-

20a

cover golf ball discussed in the patent. But while Wu

discloses the hardness of the polyurethane material

itself, and an on-the-ball hardness of Shore D 56, it

(like Molitor '751) is not directed to a three-piece ball

having a relatively hard ionomer-resin inner cover

layer. As noted, evidence at trial showed that the

measured hardness of a thin outer cover layer is

impacted by the hardness and composition of the

underlying layer. Thus, as with Molitor '751, the jury

could have reasonably found that Acushnet failed to

show that the necessary hardness limitation was

known in the prior art.

In summary, whether the prior art disclosed

the necessary hardness limitation claimed in the

Sullivan patents was an issue of fact genuinely

contested before the jury. The district court did not

err in concluding that substantial evidence supports

the jury's implicit resolution of that factual issue in

Callaway’'s favor.

Acushnet also challenges two subsidiary

evidentiary rulings made by the district court in the

course of the trial on obviousness. We review the

district court's evidentiary rulings for abuse of

discretion. In re Paoli R.R. Yard PCB Litig., 35 F.3d

717, 749 (3d Cir. 1994).

First, Acushnet challenges the exclusion of

testimony concerning measurements performed on

certain test golf balls prepared in anticipation of

trial. The test balls in question were assembled using

elements from various prior art references; for

Z2la

example, Acushnet created a ball with Proudfit's

solid core and ionomer-blend inner cover, but with

the addition of the polyurethane outer cover taught

by Molitor '751. Acushnet sought to have a materials

expert, Dr. MacKnight, testify as to the testing of the

balls in order to demonstrate that the Shore D

hardness limitations of the asserted claims were

inherently met by golf balls made _ through

combination of the prior art. Before trial, however,

the district court noted that "Dr. MacKnight neither

prepared nor tested" the balls, and hence could not

actually vouch for the reliability of the test results.

Callaway Golf Co. v. Acushnet Co., No. 06-CV-091,

2007 WL 4165401, at "1 (D. Del. Nov. 20, 2007)

("Daubert Order"). Accordingly, it excluded Dr.

MacKnight's testimony and the test results ‘to the

extent that the reliability of the test results derives

from Dr. MacKnight's voucher." Id.

At trial, Acushnet again tried to introduce the

test ball evidence, this time proffering foundational

testimony from the Acushnet employee who

supervised production of the test balls and delivered

them to the independent laboratory for testing. The

district court again excluded the evidence, however,

apparently under Rule 403 of the Federal Rules of

Evidence. Aithough the district court did not

formally state the basis for its ruling, it noted at

sidebar that the introduction of evidence of "a

physical object that combines the prior art" ran a

high risk of causing “undue prejudice" by leading the

jury to give Acushnet's obviousness argument

excessive weight. Trial Tr. 749:3-13. It further noted

that "this testimony. . . has a danger of outweighing

22a

what was really in the art at the time." Id. at 754:1l-

12. On appeal, Acushnet challenges the exclusion of

the test ball evidence at trial.

We see no error in the district court's exclusion

of the test-ball testimony on the issue of obviousness.

The introduction of evidence concerning the test balls

ran a substantial risk of leading the jury towards the

inappropriate use of hindsight and towards unduly

weighting Acushnet’s arguments concerning

motivation to combine the prior art; the likely

outcome, as the district court perceived it, was the

jury understanding Acushnet's argument concerning

the combination of prior art as "[w]e did it, here it is,

anyone can do this." Trial Tr. 749:8-9. Nor does the

record indicate that Callaway made arguments that

would have been directly refuted by the test ball

evidence, such as a contention that it would have

been impossible to combine the prior art. The district

court was in the best position in this case to

determine whether in the context of the obviousness

trial the danger of unfair prejudice outweighed the

probative value of the test ball evidence. We cannot

say that excluding the evidence here was an abuse of

discretion. See Fed. R. Evid. 403; see_ also Young

Dental Mfg. Co. v. Q@3 Special Prods., Inc., 112 F.3d

1137, 1145-46 (Fed. Cir. 1997).

Second, Acushnet contends that the district

court abused its discretion by refusing to allow it to

introduce before the jury evidence of a parallel inter

partes re- examination of the Sullivan patents

proceeding before the Patent and Trademark Office

("PTO"). In the course of the re-examination, before

23a

trial, the PTO rejected each asserted claim of the

Sullivan patents. In doing so, the PTO relied on

essentially the same prior art relied upon by

Acushnet in this litigation. Acushnet sought to

introduce the re-examination at trial to counter

Callaway's statements in opening arguments that, by

approving the four Sullivan patents, "three patent

examiners" had concluded that they were valid. The

district court rejected Acushnet's request, stating

that giving evidence of the re-examination to the jury

would be "really confusing," not least because the

results of the non-final parallel proceeding were "not

binding" on the district court. Trial Tr. 354:16-17.

The court did, however, preclude Callaway from

further bolstering the validity of the patents by

further repeating the "three examiners" statements.

On appeal, Acushnet argues that it must be

granted a new trial because “allow[ing] Callaway to

argue .. . that multiple patent examiners had

reviewed the patents .. . without revealing that the

asserted claims stood rejected by multiple other

examiners .. . was entirely unfair." Def.-Appellant's

Br. 62. Acushnet is correct that Callaway's opening

statement, while truthful, nevertheless had potential

to mislead the jury by implying that every expert

examiner to have considered the patents had

concluded that they were valid. However, Acushnet

does not appear to have actually objected to

Callaway's opening argument itself (specifically, the

"three patent examiners" statements) as unfairly

prejudicial. Acushnet instead contended only that

the argument “provided perhaps the most compelling

reason yet to admit th[e re-examination] evidence"

24a

and that the district court should have allowed the

re-examination evidence before the jury.

On this point the district court did not err. The

non-final re-examination determinations were of

little relevance to the jury's independent

deliberations on the factual issues underlying the

question of obviousness. In contrast, the risk of jury

confusion if evidence of the non-final PTO

proceedings were introduced was high. The district

court did not abuse its discretion in concluding that

the prejudicial nature of evidence concerning the

ongoing parallel re-examination proceeding

outweighed whatever marginal probative or

corrective value it might have had in this case.

III Inconsistent Jury Verdicts on Obviousness

Acushnet contends that a new trial as to

obviousness is required because the district court

denied its timely request for JMOL or a new trial,

instead entering judgment on _irreconcilably

inconsistent jury verdicts. See JMOL Order, 585 F.

Supp. 2d at 617. The jury ruled dependent claim 5 of

the '293 patent invalid for obviousness while finding

all other asserted claims, including independent

claim 4 from which claim 5 depends, not invalid.

At the outset, Callaway contends that

Acushnet waived its objection to the allegedly

inconsistent verdicts by failing to object before the

jury was released. We review inconsistent verdicts,

an issue not unique to patent law, under regional

circuit law. Mvcogen Plant Sci., Inc. v. Monsanto Co.,

25a

243 F.3d 1316, 1325 (Fed. Cir. 2001). The Third

Circuit has not directly spoken to the question of

whether an objection is required to preserve error in

the face of inconsistent general verdicts, and how

that court would rule if squarely presented with the

issue is not entirely clear. We need not resolve this

question, however, because even assuming that such

an objection is required, it is apparent that Acushnet

did not waive its claim here.

After the jury was polled at the conclusion of

the trial, counsel for Callaway (not Acushnet) called

for a sidebar and the following exchange occurred:

[Callaway]: Your Honor, the issue is the one

claim which they did find invalid

is a dependent claim.

THE COURT: [A]ll right. Do you want to send

them back?

[Callaway]: I'm not sure that they understand-

THE COURT: I'm not going to do this. All right?

[Callaway]: I just wanted to raise it.

® Compare Mallev-Duff & Assocs., Inc. v. Crown Life Ins. Co.,

734 F.2d 133, 144-45 (3d Cir. 1984) (no objection required for

inconsistent special verdicts under Rule 49(a)), and Simmons v.

City of Phil adelphia, 947 F.2d 1042, 1056-57 (3d Cir. 1991)

(suggesting in dicta that objection is required for inconsistent

interrogatories under Rule, 49(b)), with Mosely v. Wilson, 102

F.3d 85, 90 (3d Cir. 1996) ("Rule 49(b) does not address the

issue before us here-that of inconsistent general verdicts. We

have found little precedent on this issue... .”).

26a

Trial Tr. 1427:22-1428:5. The jury was then excused

without objection from Acushnet's counsel. Though it

did not object on the record, Acushnet contends that

because the court rendered a final decision in

response to Callaway's objection-"I'm not going to do

this. All right?"-no purpose would have been served

by repeating the point.

The district court evidently concluded here

that there was no waiver. Callaway argued waiver in

its post-trial briefing before the district court, but the

district court did not adopt Callaway's waiver theory,

stating that it was "sensitive to [Acushnet's]

argument that it was essentially ‘beaten to the

punch’ by [Callaway's] counsel and did not feel the

need to reiterate the same concerns following the

court's decision." JMOL Order. 585 F. Supp. 2d at

616. The district court then proceeded to decide

Acushnet's claim concerning the inconsistency on the

merits. Id. at 616-17. The district court here was in

the best position to evaluate the import of its

statements at sidebar, and we see no basis for

disturbing its determination that a waiver did not

occur.

Turning to the merits, we first must determine

whether the verdicts were in fact inconsistent. There

is no dispute that the verdicts with respect to claim 5

of the '293 patent (invalid) and claim 4 of that patent

(not invalid) were inconsistent. A _ broader

independent claim cannot be nonobvious where a

dependent claim stemming from that independent

claim is invalid for obviousness._See Ormco Corp. v.

Align Tech., Inc., 498 F.3d 1307, 1319 (Fed. Cir.

27a

2007). Callaway contends, however, that the verdict

is not irreconcilably inconsistent with regard to five

of the remaining asserted claims-claim I of the '293

patent, claims 1-3 of the '156 patent, and claim lof

the '873 patent. The basis for Callaway's argument is

that unlike claims 4 and 5 of the '293 patent, claim 5

of the '130 patent, and claim 3 of the '873 patent,

which require the inner cover layer to be made of "an

ionomer resin," those five claims require the inner

cover to contain a "blend" of ionomer resins. Thus,

Callaway argues, the jury could have rationally

concluded that the "blend" claims were not obvious

even if Claim 5, lacking a “blend" limitation, was

obvious.

The district court properly rejected this theory,

noting that Callaway's reasoning, which would at

best render the verdict "consistent with respect to

the 5 ‘blend’ claims, but. . . inconsistent with respect

to the four 'non-blend' claims," did "not give the court

sufficient means to reconcile the verdicts." JMOL

Order, 585 F. Supp. 2d at 616. Reconciliation of

inconsistent verdicts must be consistent with the

evidence and theories adduced at trial. See Malley:

Duff, 734 F.2d at 145-46. The contents of the four

Sullivan patents, which share essentially the same

specification and claim priority to the same parent

application, were presented to the jury as a group.

The evidence and theories at trial were also

advanced concerning the patents as a group, not ona

claim-by-claim basis. No party at trial asserted any

patentable difference among the asserted clams

before the jury or _ otherwise meaningfully

distinguished between claims on the basis of the

28a

"blend" limitation.

The district court recognized that under Third

Circuit law a court faced with inconsistent general

verdicts after the jury is dismissed has an obligation

to attempt to read the verdicts in a manner that will

resolve the inconsistencies. JMOL Order, 585 F.

Supp. 2d at 616-17; see Mosely, 102 F.3d at 90.

Although the district court agreed with Acushnet

that the verdicts here were genuinely and

irreconcilably inconsistent, it nevertheless denied

Acushnet's motion for a new trial. The court noted

that Acushnet "stipulated that it infringes each of

the Sullivan patents; three of which were held valid

by the jury without reservation," and that the

inconsistency therefore was harmless. JMOL Order,

585 F. Supp. 2d at 617.

This reasoning is flawed. Although it is true

that the jury found “without reservation" that eight

claims were not invalid, it is equally true that the

jury found claim 5 invalid without reservation.

Moreover, the evidence at trial was such that the

jury could have rationally reached either verdict with

regard to the asserted claims; neither party was

entitled to judgment as a matter of law. Under Third

Circuit law, in a case where a reading of the verdicts

that would solve the apparent inconsistency proves

impossible and the evidence might support either of

the two inconsistent verdicts, "the appropriate

remedy is ordinarily, not simply to accept one verdict

and dismiss the other, but to order an entirely new

trial."" Mosely, 102 F.3d at 90 (quoting Los Angeles v.

Heller, 475 U.S. 796, 806 (1986) (Stevens, J.,

29a

dissenting)).!° In these circumstances, Acushnet is

correct that a new trial rather than entry of

judgment was required as to claims 4 and 5 of the

'293 patent.

In sum, we agree with Acushnet that the

verdict form returned by the jury reflects an

irreconcilable inconsistency. Accordingly, we vacate

the judgment of the district court and remand for a

new trial on obviousness.

IV Anticipation

As noted above, the district court granted

summary judgment that the claims were not

anticipated by Nesbitt. Nesbitt describes a three-

piece ball with a core, a relatively hard ionomer-resin

inner cover, and a relatively soft ionomer-resin outer

cover. Summary Judgment Order, 523 F. Supp. 2d at

395. Although Nesbitt itself does not expressly

disclose two limitations of the Sullivan claims (the

use of polyurethane in the outer cover and the use of

a blend of ionomer resins in the inner cover),

Acushnet argued that Nesbitt contains these

limitations because it incorporates Molitor '637 by

reference. The relevant passage of Nesbitt describing

10 The Third Circuit has noted that in rare cases apparently

inconsistent verdicts may be allowed to stand. Mosely, 102 F.3d

at 90. That court has since clarified that "[t]hose circumstances

are where the verdict appears to be the result of compromise as

opposed to jury confusion." Acumed LLC v. Advanced Surgical

Servs., Inc 561 F.3d 199, 217 n.13 (3d Cir. 2009) (quotation

marks omitted). There is no contention that the verdict here

could plausibly be considered such a compromise.

30a

the materials that may be used in the cover layers of

the Nesbitt golf ball is as follows:

The inner, intermediate, or first layer or ply

14 and the outer cover, second layer or ply 16

or either of the layers may be cellular when

formed of a foamed natural or svnthetic

polymeric material. Polymeric materials are

preferably such as ionomer resins which are

foamable. Reference is made to the

litor i in S. Pat. No. 4,274,637

which describes a number of foamable

itions of har r_whi

emploved for one or both lavers 14 and I6 for

the golf ball of this invention.

Nesbitt col.3 11.51-61 (emphases added). Molitor '637,

in turn, undisputedly teaches that many foamable

materials, including both polyurethane and ionomer-

resin blends, may be used as golf ball cover

materials:

The range of synthetic polymeric materials

which can be used in accordance with this

invention, other than the above described

Surlyn [ionomer] resins, is much broader

than the range of natural materials. Suitable

polymer materials which may be adapted for

use in this invention are as follows:

Homopolymeric and copolymeric substances,

such as (1) vinyl resins. . .; (2) polyolefins such

as polyethylene, polypropylene, polybutylene,

3la

transpolyisoprene, and the like .. . (3)

polyurethanes . . .; (4) polyamides . . .; (5)

polystyrene. . .; (6) acrylic resins .. .; (7)

thermoplastic rubbers such as the urethanes. .

., and (8) polyphenylene oxide resins... . This

list is not meant to be limiting or exhaustive,

but merely illustrates the wide range of

polymeric materials which may be employed in

the present invention, Mixtures of the above

described material may also be used.

Molitor '637 col. 5 11.33-55 (emphases added); see also

id.col.l 11.44-45 ("Mixtures of various [ionomer]

resins as cover stock materials are likewise highly

advantageous.").

The district court rejected Acushnet's

argument, holding that Nesbitt failed to specifically

incorporate polyurethane and ionomer-resin blends

from Molitor '637. Summary Judgment Order, 523 F.

Supp. 2d at 396. Without the benefit of Molitor's

teachings, Nesbitt failed to anticipate as a matter of

law. The district court therefore granted summary

judgment of no anticipation. Id. at 398. On appeal,

Acushnet contends the district court erred in holding

that Nesbitt does not incorporate Molitor

We review the grant of summary judgment de

novo. Whether material is incorporated by reference

into a host document is a question of law. Advanced

Display Sys., Inc. vy. Kent State Univ., 212 F.3d 1272,

1283 (Fed. Cir. 2000). A patent claim is invalid due

to anticipation if, within "the four corners of a single,

prior art document. . . every element of the claimed

32a

invention [is described], either expressly or

inherently, such that a person of ordinary skill in the

art could practice the invention without undue

experimentation." Id, at 1282. However, "[mJaterial

not explicitly contained in the single, prior art

document may still be considered for purposes of

anticipation if that material is incorporated by

reference into the document.” Id.

To incorporate matter by reference, a host

document must contain language "clearly identifying

the subject matter which is incorporated and where

it is to be found"; a “mere reference to another

application, or patent, or publication is not an

incorporation of anything therein... ." In re de

Seversky, 474 F.2d 671, 674 (CCPA 1973). Put

differently, "the host document must identify with

detailed particularity what specific material it

incorporates and clearly indicate where that material

is found in the various documents.”_Adv. Display

Sys., 212 F.3d at 1282. Nesbitt identifies with

specificity both what material is being incorporated

by reference (foamable polymeric compositions

suitable for golf ball cover layers) and where it may

be found (the Molitor patent). Nesbitt col.3 11.51-61.

We have previously held that language nearly

identical to that used in Nesbitt ("[rjeference is made

to") can be sufficient to indicate to one of skill in the

art that the referenced material is fully incorporated

in the host document. See In re Voss, 557 F.2d 812,

815-16 (CCPA 1977); In re Hughes, 550 F.2d 1273,

1275-76 (CCPA 1977). Here, however, the district

court held that Nesbitt satisfies the requirements for

incorporation only with regard to the ionomer resins

33a

disclosed in Molitor, stating that "Molitor '673 is

mentioned in Nesbitt to identify examples of suitable

resins, preferably ionomer resins, and not to

specifically incorporate polyurethane." Summary

Judgment Order, 523 F. Supp. 2d at 396.

Callaway in support of the district court

argues that even if Nesbitt incorporates Molitor '637

as to ionomer resins, it does not incorporate with

respect to the use of polyurethane for the outer cover

because it refers to the use of ionomer resins as

"preferabl[{e]." Nesbitt col.3 1.55. Polyurethane is not

an ionomer resin. Although Molitor '637 does state

that ionomer resins are the preferable material for

such use, on its face the reference to Molitor '637 in

Nesbitt is not limited to those resins. Rather, Nesbitt

states broadly that the layers of the golf ball

disclosed therein may be made from a “natural or

synthetic polymeric material." Id. col.3 11.53-54.

Nesbitt goes on to directly indicate that such

materials include all of the foamable polymeric

materials described in Molitor: "Reference is made to

{Molitor '637] which describes a number of foamable

compositions of a character which may be employed

for one or both layers. . . for the golf ball of this

invention." Id. col.3 1156-61 (emphasis added).

Polyurethane is a foamable composition. Nesbitt

incorporates the entire list of foamable compounds

("a number of foamable compositions") disclosed by

Molitor '637 as appropriate materials for use in golf

ball cover layers, including polyurethane and

mixtures of ionomer resins.. . We perceive no basis to

differentiate between incorporation of the ionomeric

resins disclosed by Molitor '637 and the other

34a

compositions in the list, including polyurethane.'

Accordingly, we hold that Nesbitt incorporates by

reference the potential cover layer materials

described in Molitor ‘637, including polyurethane

and ionomer resin blends.

Callaway contends that even if the district

court erred in concluding that Nesbitt does not

incorporate Molitor ‘637, summary judgment of no

anticipation was still appropriate. That issue was not

addressed by the district court, and it is not clear to

us that Callaway properly raised this issue in its

motion for summary judgment before that court. We

are therefore reluctant to consider this issue on

appeal. Nothing we say here precludes the district

court from permitting Callaway to file a new motion

for summary judgment on that issue, if the district

court thinks it appropriate.

One matter, however, requires our attention.

Callaway contends that the trial court properly

excluded the test ball evidence on the issue of

anticipation. On this point we disagree. This requires

us to examine the grounds for the district court's

decision in this respect. First, the district court

refused to consider the test ball evidence on the issue

of anticipation because it found that Nesbitt did not

incorporate the Molitor '637 reference, and that the

test balls therefore did not embody any single item of

anticipatory prior art. Summary Judgment Order,

523 F. Supp. 2d at 400 ("The balls . . . were neither

completely representative of Nesbitt, nor were they

completely representative of Proudfit ... ."). This

ground for excluding the evidence necessarily fails in

35a

light of our holding that Nesbitt does incorporate

Molitor.!! Second, with respect to obviousness, the

district court refused to allow the test ball evidence

at trial because presentation of the evidence could

lead the jury to give undue weight to Acushnet's

arguments concerning motivation to combine and

obviousness. This ground is_ inapplicable to

Acushnet's anticipation argument, where motivation

to combine is not an issue. Third, at summary

judgment, the district court excluded the testimony

of Acushnet's expert, Dr. MacKnight, on the ground

that MacKnight had not had sufficient involvement

in the preparation and testing of the balls to vouch

for their reliability. Daubert Order, 2007 WL

4165401, at *1 ("Dr. MacKnight neither prepared nor

tested anything. ... [T]o the extent that the

reliability of the test results derives from Dr.

MacKnight’s voucher, such evidence is excluded"). As

discussed above we find no error in the district

court's ruling, but the fact remains that at trial

Acushnet also proffered the testimony of Jeff Dalton

(who supervised preparation of the balls) and of an

employee of the testing laboratory. On remand, that

testimony may be sufficient to authenticate the balls,

and support the admission into evidence of balls

designed to replicate Nesbitt on the issue of

anticipation.

i! Indeed, while challenging Acushnet's test balls as an

agglomeration of prior art elements, Callaway appears to

recognize that re-creations or "models of balls described in

individual prior art references" may be relevant. PI.-Appellee's

Br. 58; see id. at 25.

36a

Because Nesbitt incorporates the compositions

taught by Molitor '637, we reverse the judgment of

the district court granting summary judgment to

Callaway and remand for further proceedings on

that issue.

CONCLUSION

For the reasons discussed above, the judgment

of the district court is affirmed- in-part, reversed-in-

part, and vacated-in-part. The permanent injunction

against Acushnet entered on November 10, 2008, is

vacated and the case is remanded for further

proceedings not inconsistent with this opinion.

AFFIRMED-IN-PART, REVERSED-IN-PART,

VACATED-IN-PART, and REMANDED

COSTS

No costs.

2009-1076

37a

APPENDIX B

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF DELAWARE

06-091-SLR

CALLAWAY GOLF COMPANY,

Plaintiff,

ACUSHNET COMPANY,

Defendant.

ORDER

At Wilmington, this 10th day of November,

2008, consistent with the memorandum opinion

issued this same date;

IT IS ORDERED that:

3. Defendant's motion for judgment as a

matter of law or, in the alternative, for a new trial

(D.I. 409) is denied.

2. Plaintiffs motion for a permanent

38a

injunction (D.I. 411) is granted.

3. Defendant’s motion to stay’ the

injunction pending appeal (D.I. 440) is denied.

United State District Judge

39a

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF DELAWARE

06-091-SLR

CALLAWAY GOLF COMPANY,

Plaintiff,

ACUSHNET COMPANY,

Defendant.

JUDGMENT IN A CIVIL CASE

For reasons stated in the jury verdict of

December 14, 2007;

IT IS ORDERED AND ADJUDGED that

judgment be and is hereby entered in favor of

Acushnet Company with respect to the invalidity of

asserted claim 5 of U.S. Patent No. 6,210,293 and for

Callaway Golf Company in all other respects.

United State District Judge

Dated: December 19, 2007

(By) Deputy Clerk

40a

APPENDIX C

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF DELAWARE

06-091-SLR

CALLAWAY GOLF COMPANY,

Plaintiff,

Vv.

ACUSHNET COMPANY,

Defendant.

ORDER

WHEREAS Defendant Acushnet Company on

December 3, 2007 stipulated that its Pro V1® line of

products, collectively, are covered by and infringe the

following claims of Callaway Golf's patents: claims 1,

4, and 5 of U.S. Patent No. 6,210,293; claims 1, 2,

and 3 of U.S. Patent No. 6,503,156; claim 5 of U.S.

Patent No. 6,506,130; and claims 1 and 3 of U.S.

Patent No. 6,595,873 [D.I. 367]; and

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WHEREAS the Jury returned a verdict on

December 14, 2007 upholding the validity of claims 1

and 4 of U.S. Patent No. 6,210,293; claims 1, 2, and 3

of U.S. Patent No. 6,503,156; claim 5 of U.S. Patent

No. 6,506,130; and claims 1 and 3 of U.S. Patent No.

6,595,873 ("the Relevant Patent Claims") [D.I. 398];

and

WHEREAS, consistent with the Jury's verdict,

the Court entered judgment in Callaway Golf’s favor

on December 19, 2007 with respect to the validity of

the Relevant Patent Claims [D.I. 404];

IT IS HEREBY ORDERED, this 10th day of

November, 2008, that:

1. Pursuant to 35 U.S.C. § 283, Acushnet

and its successors, assigns, officers, agents, servants,

employees, attorneys, and persons in active concert

or participation with them, including any affiliated

42a

entities, during the term of the patents-in-suit (U.S.

Patent Nos. 6,210,293; 6,503,156; 6,506,130; and

6,595,873), are hereby ENJOINED and

RESTRAINED from infringing and from inducing,

contributing to, or otherwise causing’ the

infringement of the Relevant Patent Claims by

making, using, selling, or offering to sell in the

United States, or importing into the United States,

or by inducing, contributing to, or otherwise causing

the performance of any such activities by third-

parties with regard to, any of the Pro V1® line of golf

balls including the Pro V1®, Pro V1x®, Pro VI*®, or

any variations thereof not more than colorably

different (collectively “the Pro V1® products”).

2. Acushnet's professional golfers currently

under contract are permitted to play Pro V1®

products through the end of the 2008 calendar year.

43a

United States District Judge

44a

APPENDIX D

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF DELAWARE

06-091-SLR

CALLAWAY GOLF COMPANY,

Plaintiff,

Vv.

ACUSHNET COMPANY,

Defendant.

Thomas L. Halkowski, Esquire of Fish & Richardson

P.C., Wilmington, Delaware. Counsel for Plaintiff.

Of Counsel: Frank E. Scherkenbach, Esquire of Fish

and Richardson P.C., Boston, Massachusetts; Roger

A. Denning, Esquire of Fish and Richardson P.C.,

San Diego, California.

Richard L. Horwitz, Esquire and David E. Moore,

Esquire of Potter Anderson & Corroon LLP,

Wilmington, Delaware. Counsel for Defendant. Of

Counsel: Joseph P. Lavelle, Esquire, Kenneth W.

Donnelly, Esquire, and Brian A. Rosenthal, Esquire

of Howrey LLP, Washington, D.C.

MEMORANDUM OPINION

Dated: November 10, 2008

Wilmington, Delaware

45a

Robinson, District Judge

I. INTRODUCTION

Callaway Golf Company ("plaintiff) filed this

action against Acushnet Company ("defendant") on

February 9, 2006, ‘alleging infringement of U.S.

Patent Nos. 6,506,130 (“the ’130 patent”), 6,503,156

(“the '156 patent”), 6,210,293 (“the '293 patent”), and

6,595,873 (“the '873 patent”) (collectively, “the

Sullivan patents”), (D.I. 1) Plaintiff alleged that

defendant's Titleist® Pro V1® brand golf balls

embody the technology claimed in one or more claims

of the asserted patents. (Jd. at 4417-21) The parties

filed motions for summary judgment. (D.I. 197, 200,

201, 213, 215) On November 20, 2007, the court

issued its claim construction decision (D.I. 345) and

issued its memorandum opinion on the summary

judgment motions (D.I. 347), in which it granted

plaintiffs motions for summary judgment of no

anticipation and for breach of contract, denied

defendant’s motions for summary judgment of

invalidity and no breach of contract, and denied

defendant's motion for partial summary judgment

that U.S. Patent No. 4,274,637 to Molitor (“Molitor

637”) was incorporated by reference into a particular

piece of prior art. Prior to trial, defendant stipulated

that its Pro V1® golf balls infringe claims 1, 4 and 5

of the ’293 patent, claims 1-3 of the '156 patent,

claim 5 of the '130 patent, and claims 1 and 3 of the

’873 patent, and that its Titleist® Pro V1x® and Pro

V1*® golf balls infringe all of the foregoing claims,

with the exception of claim 1 of the '293 patent. (D.I.

367) A jury trial was held between December 5 and

46a

14, 2007 on the issue of validity of each of the

asserted claims, due to obviousness. The jury

returned a verdict that each asserted claim was valid

but one — claim 5 of the ’'293 patent — which it found

invalid. (D.I. 399) Currently before the court are

several motions: defendant's motion for judgment as

a matter of law ("JMOL") or, in the alternative, for a

new trial (D.I. 409); plaintiff's motion for a

permanent injunction (D.I. 411); and defendant's

motion to stay any permanent injunction issued by

this court pending appeal (D.I. 440). The court has

jurisdiction over these issues pursuant to 28 U.S.C.

§§ 1331, 1838(a) and 1400(b).

Il, BACKGROUND

A. Technology and Patents at Issue

As discussed in the court's previous opinion

(D.I. 347), this case involves golf ball technology.

Golf balls are typically identified as two-piece or

three-piece balls. Two-piece balls have a core, which

is either solid or "wound," and an outer layer. A core

that is considered solid is made of rubber and can be

one solid piece or multiple layers. A wound core is

made of elastic windings wrapped around either a

solid or liquid-filled center. Three-piece balls have an

additional layer covering the core, so that the ball is

characterized as having a core, an inner cover layer

and an outer cover layer.

The challenge faced by golf ball designers has

been to create a ball that is both capable of traveling

great distances and of achieving the desired "feel," or

47a

spin. Historically, balls would have to be very hard in

order to achieve distance when struck by a fast-

moving driver. To achieve spin, however, balls had to

be softer so that they would better grip to the face of

angled clubs such as irons. The patents at issue

present “dual personality" balls that achieve a

marriage of these diametrically-opposed objectives.

Michael J. Sullivan is the sole named inventor

on each of the '130, '156, '293, and '873 patents in

suit (collectively, the "Sullivan patents"). The

Sullivan patents have _ substantially identical

specifications. Each of the underlying (continuation)

applications were filed in 1999 (the '293 patent) and

2001 (the '130, '156, and ‘873 patents); all claim

priority to U.S. Patent Application No. 08/070,510,

filed June 1, 1993. The Sullivan patents issued to

Spalding Sports Worldwide, Inc. ("Spalding") in April

2001 (the '293 patent) and in 2003.

The Sullivan patents each claim a multi-layer

golf ball comprising a core, an inner cover layer made

of a low acid ionomer, and an outer cover layer made

of polyurethane.' The claims differentiate between

the hardness and thickness of these layers. Claim 1

of the '293 patent claims:

1. A golf ball comprising: a core; an inner

cover layer having a Shore D hardness of

60 or more molded on said core, said inner

cover layer having a thickness of 0.100 to

' Claims 1 and 2 of the '130 patent do not require that the

outer cover layer include polyurethane. These claims were not

at issue in the present suit.

48a

0.010 inches, said inner cover layer

comprising a blend of two or more low

acid ionomer resins containing no more

than 16% by weight of an alpha, beta-

unsaturated carboxylic acid; and an outer

cover layer having a Shore D hardness of

64 or less molded on said inner cover

layer, said outer cover layer having a

thickness of 0.010 to 0.070 inches, and

said outer cover layer comprising a

relatively soft polyurethane material.

Claim 4 of the ‘293 patent is also an

independent claim, which reads:

4. A multi-layer golf ball comprising: a

spherical core; an inner cover layer having

Shore D hardness of about 60 or more

molded over said spherical core, said

inner cover layer comprising an ionomeric

resin including no more than 16% by

weight of an alpha, beta-unsaturated

carboxylic acid and having a modulus of

from about 15,000 to about 70,000 psi;

and an outer cover layer having a Shore D

hardness of about 64 or less disposed

about said inner cover layer and defining

a plurality of dimples to form a multi-

layer golf ball, said outer cover layer

comprising polyurethane based material.

Claim 5 of the '293 patent is dependant on

claim 4, and also requires that the “inner cover layer

has a thickness of about 0.100 to about 0.010 inches

49a

and said outer cover layer has a thickness of about

0.010 to about 0.070 inches, said golf ball having an

overall diameter of 1.680 inches or more."

By way of contrast, claim 1 of the '156 patent

claims:

1. A golf ball comprising: a core; an inner

cover layer disposed on said core, said

inner cover layer having a Shore D

hardness of at least 60, said inner cover

layer comprising a blend of two or more

low acid ionomer resins, each containing

no more than 16% by weight of an alpha,

beta-unsaturated carboxylic acid; and an

outer cover layer disposed on said inner

cover layer, said outer cover layer having

a Shore D hardness of about 64 or less, a

thickness of from about 0.01 to about 0.07

inches, and comprising a polyurethane

material.

Claims 2 and 3 of the ‘'156 patent are

dependant on claim 1. Claim 2 adds the limitation

that the “outer cover layer has a thickness of from

about 0.01 to about 0.05 inches"; claim 3 increases

these same thickness ranges to "about 0.03 to about

0.06 inches."

Claim 5 of the '130 patent reads as follows:

5. A multi-layer golf ball comprising: a

spherical core; an inner cover layer having

a Shore D hardness of about 60 or more

a re ee le ee ee a NE

50a

molded over said spherical core, said

inner cover layer comprising an ionomeric

resin including no more than 16% by

weight of an alpha, beta-unsaturated

carboxylic acid and having a modulus of

from about 15,000 to about 70,000 psi; an

outer cover layer having a Shore D

hardness of about 64 or less molded over

said spherical intermediate ball to form a

multi-layer golf ball, the outer layer

comprising polyurethane based material.

Finally, plaintiff asserted two independent

claims of the '873 patent, claims 1 and 3, which are

reproduced below.

1. A golf ball comprising: a core; an inner

cover layer disposed on said core, said

inner cover layer having a thickness of

from about 0.100 to about 0.010 inches,

said inner cover layer comprising a blend

of two or more ionomer resins, at least one

of which contains no more than 16% by

weight of an alpha, beta-unsaturated

carboxylic acid; and an outer cover layer

disposed on said inner cover layer, said

outer cover layer having a thickness of

0.010 to 0.070 inches, and said outer cover

layer comprising a polyurethane material,

wherein said golf ball has an overall

diameter of 1.680 inches or more, said

inner cover layer having a Shore D.

hardness of at least 60, and said outer

cover layer having a Shore D hardness of

pe i

5la

less than 64.

3. A multi-layer golf ball comprising: a

spherical core; an inner cover layer having

Shore D hardness of at least 60 disposed

on said spherical core, said inner cover

layer comprising an ionomeric_ resin

including no more than 16% by weight of

an alpha, beta-unsaturated carboxylic

acid and having a modulus of from about

15,000 to about 70,000 psi; and an outer

cover layer having a Shore D hardness of

about 64 or less disposed about said inner

cover layer and defining a plurality of

dimples to form a multi-layer golf ball,

said outer cover layer comprising a

polyurethane based material and said

outer cover layer having a thickness of

from about 0.010 to about 0.070 inches.

52a

C. Products

Plaintiff and defendant have both had success

selling multi-layer golf balls. Plaintiff markets

several balls embodying the patented technology,

including the Callaway Golf® Rule 35®, the CTU

30®, Callaway Golf® HX®, Ben Hogan®, Strata®,

Tour Ace®, and Top-Flite® balls. Defendant markets

and sells golf balls under the Titleist® brand,

including the Titleist Pro VI®, Pro Vlx®, and Pro

V1*® series of balls that defendant stipulated

infringe one or more of the Sullivan patents.

D. Trial

Defendants, having the burden of proof,

presented their invalidity case to a jury between

December 5 and 14, 2007. In its case-in-chief,

defendant called several witnesses: (1) Mr. Jerry

Bellis, defendant's Executive Vice President of Sales

and Marketing; (2) Mr. William Morgan, defendant's

Senior Vice President of Research and Development

for golf balls; (3) Mr. Jeff Dalton, defendant's Vice

President of Intellectual Property; (4) Mr. James

Proudfit, inventor of U.S. Patent No. 5,314,187

("Proudfit '187"), a critical prior art reference in the

case (by deposition); (5) Mr. Sullivan, inventor of the

Sullivan patents, who has been employed with

defendant since 2000; (6) Mr. Scott White,

Callaway's Director of Marketing (by deposition);

and (7) Mr. Joseph Nauman, defendant's Chief Legal

Officer. Defendant also called its expert witness, Dr.

Robert J. Statz, a retired du Pont Ph.D. polymer

chemist, who testified, inter alia, that the Sullivan

53a

patents were obvious in view of Proudfit '187 in view

of either U.S. Patent No. 4,674,751 to Molitor et. al.

("Molitor '751") or U.S. Patent No. 5,334,673 to Wu

("Wu"), and that the Sullivan patents were obvious

in view of the Wilson Ultra Tour Balata golf ball in

combination with either Molitor '751 or Wu. Plaintiff

thereafter called several rebuttal witnesses: (1) Mr.

Tom Kennedy, plaintiffs Senior Vice President of

Intellectual Property Development; (2) Mr. Mike

Yagley, plaintiffs Vice President of Business

Innovations (and former Vice President of Product

Management for Callaway golf balls); (3) Mr.

William Burke, defendant's Chief Financial Officer

(by deposition); (4) Mr. Edmund Hebert, defendant's

Senior Manager of Product Development for

advanced concepts (by deposition); (5) Ms. Mary

Louise Bohn, defendant's Vice President of

Advertising and Communications (by deposition); (6)

Mr. Chris Cavallaro, defendant's Senior Product

Development Manager responsible for the Pro V1®

family of products (by deposition); and (7) Mr. Dennis

Nesbitt, named inventor on prior art golf ball patents

(by deposition). Plaintiff also presented the

testimony of its own expert, Dr. William Risen, a

Ph.D. chemist at Brown University who has

consulted with plaintiff and its predecessor on golf

ball applications for 48 years. Dr. Risen rebutted Dr.

Statz's testimony. At the close of the evidence, the

jury returned a verdict that each asserted claim was

valid but one — claim 5 of the '293 patent — which it

found invalid. (D.1.399)

II. LEGAL STANDARDS

54a

A. Motion for Judgment as a Matter of

Law

To prevail on a renewed motion for judgment

as a matter of law following a jury trial under

Federal Rule of Civil Procedure 50(b), the moving

party "must show that the jury's findings, presumed

or express, are not supported by substantial evidence

or, if they were, that the legal conclusions implied

[by] the jury's verdict cannot in law be supported by

those findings." Pannu v. Jolab Corp., 155 F.3d 1344,

1348 (Fed. Cir. 1998) (quoting Perkin-Elmer Corp. v.

Computenvision Corp., 732 F.2d 888, 893 (Fed. Cir.

1984)). “Substantial’ evidence is such relevant

evidence from the record taken as a whole as might

be acceptable by a reasonable mind as adequate to

support the finding under review." Perkin-Elmer

Corp., 732 F.2d at 893. In assessing the sufficiency of

the evidence, the court must give the non-moving

party, "as [the] verdict winner, the benefit of all

logical inferences that could be drawn from the

evidence presented, resolve all conflicts in the

evidence in his favor, and in general, view the record

in the light most favorable to him." Willamson v.

Consol. Rail Corp., 926 F.2d 1344, 1348 (3d Cir.

1991); Perkin-Elmer Corp., 732 F.2d at 893. The

court may not determine the credibility of the

witnesses nor "substitute its choice for that of the

jury between conflicting elements of the evidence."

Id. In summary, the court must determine whether

the evidence reasonably supports the jury's verdict.

See Dawn Equip. Co. v. Kentucky Farms Inc., 140

F.3d 1009, 1014 (Fed. Cir. 1998).

55a

B. Motion for a New Trial

The decision to grant or deny a new trial is

within the sound discretion of the trial court and,

unlike the standard for: determining judgment as a

matter of law, the court need not view the evidence

in the light most favorable to the verdict winner. See

Allied Chem. Corp. v. Daflon, Inc., 449 U.S. 33, 36

(1980). Federal Rule of Civil Procedure 59(a)

provides, in pertinent part:

A new trial may be granted to all or any of

the parties and on all or part of the issues

in an action in which there has been a

trial by jury, for any of the reasons for

which new trials have heretofore been

granted in actions at law in the courts of

the United States.

New trials are commonly granted in the

following situations: (1) where the jury's verdict is

against the clear weight of the evidence, and a new

trial must be granted to prevent a miscarriage of

justice; (2) where newly-discovered evidence surfaces

that would likely alter the outcome of the trial; (3)

where improper conduct by an attorney or the court

unfairly influenced the verdict; or (4) where the

jury's verdict was facially inconsistent. See Zarow-

Smith v. N.J. Transit Rail Operations, 953 F. Supp.

581, 584 (D.N. J. 1997) (citations omitted). The court,

however, must proceed cautiously and not substitute

its own judgment of the facts and assessment of the

witnesses’ credibility for the jury's independent

evaluation. Nevertheless,

56a

[w]here a trial is long and complicated

and deals with a subject matter not lying

within the ordinary knowledge of jurors a

verdict should be scrutinized more closely

by the trial judge than is necessary where

the litigation deals with material which is

familiar and simple, the evidence relating

to ordinary commercial practices. An

example of subject matter unfamiliar to a

layman would be a case requiring a jury

to pass upon the nature of an alleged

newly discovered organic compound in an

infringement action.

Lind v. Schenley Indus. Inc., 278 F.2d 79, 90-91 (3d

Cir. 1960).

IV. DISCUSSION

A. JMOL of Invalidity

It was defendant's burden to prove obviousness

at trial by clear and convincing evidence, defined to

the jury as “evidence that produces an abiding

conviction that the truth of a factual contention is

highly probable." The jury having declined to

invalidate the Sullivan patents,? defendant must

now demonstrate that the verdict of nonobviousness

was not supported by substantial evidence. That is,

defendant must show the absence of facts necessary

2 The verdict of invalidity with respect to dependant claim 5 of

the '293 patent is discussed infra in the context of inconsistent

verdicts.

57a

to support a verdict of nonobviousness, such that no

reasonable jury could conclude that defendant failed

to meet its high burden of proof. Such a showing is

nearly unattainable in view of the fact that plaintiff

presented its own rebuttal expert, Dr. Risen, who

testified regarding both the scope of the prior art and

the lack of a motivation to combine, a question of

fact. See Group One Ltd. v. Hallmark Cards, Inc.,

407 F.3d 1297, 1304 (Fed. Cir. 2006) ("Expert

testimony of a lack of motivation to combine and the

use of hindsight by opposing experts constitutes

substantial evidence of nonobviousness.") (quoting

Teleflex, Inc. v. Ficosa N. Am. Corp., 299 F.3d 1313,

1334 (Fed. Cir. 2002) (internal quotations and

brackets omitted). Notwithstanding, the court will

briefly analyze plaintiffs evidence of nonobviousness.

2, Proudfit '187 in view of Molitor '751

or Wu

a. All limitations present

Plaintiff argues that there is no indication that

Proudfit '187 combined with either Molitor '751 or

Wu would be understood by a person of skill in the

art to provide a polyurethane cover material having

a Shore D hardness of 64 or less. A Shore D hardness

value is not expressly contained in any of these

references. With respect to Molitor '751, defendant

relies on a disclosure of a "Shore C" hardness value

of 72-76% which it asserts corresponds to a Shore D

3 Molitor '751 discloses "an improved golf ball cover useful in

making balls, particularly two-piece balls" (DTX-11, col. 1, ll.

11-15), which "refers primarily to balls consisting of a molded

58a

hardness of less than 64. (D.I. 417 at 9; DTX-II at col.

7. 11.27-29) With respect to Wu, defendant argued at

trial that the Wu polyurethane measured at a Shore

D hardness of 48 to 50 off the ball (D.I. 424 at

493:23-494:3), the Titleist® Pro VI® used a

polyurethane cover having a Shore D hardness of 56

taken "on the ball"* (id. at 467:15-18), and Dr. Statz

testified that, because the Titleism Pro V1® had a

slightly thicker polyurethane cover than the cover

layer disclosed in Proudfit '187, a person of ordinary

skill in the art would expect a Shore D hardness of

around 56, and less than 64, for the cover of the

claimed combination (D.1.426 at 618: 12-619:4).

Absent any direct evidence of a Shore D

hardness of less than 64 in any of the asserted

references, the jury's verdict of validity is not

surprising. For its Molitor '751 argument, defendant

relied on two "comparison" charts containing both

Shore C and Shore D hardness values. (PTX-804;

DTX-8 at CW0309061) One of these charts was

submitted to the PTO by plaintiff for the purpose of

traversing a 35 U.S.C. § 112, first paragraph

core and a cover, but also includes balls having a separate solid

layer beneath the cover" (id. at col. 3, ll.7-9). A table is provided

containing "finished ball data" for several samples. "Samples 7,

8, and 10 constitute preferred embodiments, with a Shore C

hardness within the range of 72-76." (Id., col. 7. ll. 27-29)

"(O]ther materials may be included in the cover in addition to

the essential urethane and ionomer resins . ..provided the cover

is formulated to have the requisite Shore C hardness." (/d., col.

7, ll. 35-39)

* The court declines defendant's invitation to reconsider its

claim construction ruling and grant JMOL on that ground. (D.I.

417 at 27-29)

59a

rejection during the prosecution of the '873 patent.

(DTX-8 at CW0309061) Notwithstanding, both

"comparison" charts expressly state that they "[are]

not and cannot be used as a conversion [tool]."

Defendant admits that "no simple, linear relation

exists between Shore C and Shore D measurements

and a direct conversion from C to D cannot be done

with [a] chart." (D.I. 417 at 14) Defendant's

argument is that "[w]hile we may not know if 72C

‘converts' exactly to 50D or 51D, an artisan knew

from the chart that the range 72-76C would be less

than 60 Shore D." (/d.) Mr. Sullivan testified that a

Shore C hardness of 65 is less than 64 on the Shore

D scale, as evidenced by the specification's use of the

phrase "Shore D hardness of about 45 (i.e., Shore C

hardness of about 65)." (D.I. 427 at 802:24-803:8;

DTX-1 at col. 3, ll. 52-53) Dr. Statz testified that,

according to the charts, a Shore C of 72-76 correlated

to a Shore D hardness of about 55. (D.I. 426 at

600:23-602:3)

Plaintiff presented rebuttal evidence that the

material underneath the cover layer influences the

Shore D measurement when taken on the ball.®

5 Mr. Dalton agreed that attempting a Shore C to Shore D

conversion would not be expected "to be nearly as accurate" as a

direct Shore D measurement. (D.I. 424 at 515:25-516:4) Mr.

Kennedy testified for plaintiff that a straight correlation is not

possible. (D. l. 428 at 101 8:6-15) Mr. Risen testified similarly.

(Id. at 1162:8-24)

6 Mr. Dalton admitted on cross that thin ball covers are "more

influenced by what's underneath them than thicker covers";

what's underneath the layer you are measuring can influence

the hardness measurement. (D.J. 424 at 516:10-24) One of

60a

Therefore, "a skilled artisan would not have thought

that a Molitor '751 [polyurethane] cover would

exhibit the same hardness when used as the outer

cover of a Proudfit-type ball as it did when used as

the single cover of a 2-piece ball, let alone exhibit the

hardness as claimed in the patents-in-suit." (D.1. 455

at 12) Plaintiff does not point to affirmative evidence

tending to demonstrate that a Shore C measurement

of 72-76 corresponds to a Shore D measurement

greater than 64. (Jd. at 14) It was not plaintiff's

burden to do so, however. On this record, the jury

could have found defendant's evidence regarding the

presence of the Shore D hardness limitation in the

prior art fell short of clear and convincing, insofar as:

(1) the prior art did not contain any Shore D

hardness values; (2) the tables themselves contained

disclaimers on their use as conversion tools; and (3)

hardness values vary based on the number and

nature of the inner layers, and from the plaque to "on

the ball."

b. Motivation to combine and

reasonable expectation of success

defendant's patents, issued in 2005, states that "“[hjardness,

when measured directly on a golf ball (or other spherical

surface) is a completely different measurement and, therefore,

results in a different hardness value [than that for a flat slab or

button]. This difference results from a number of factors

including, but not limited to, ball construction (i.e., core type,

number of core and/or cover layers, etc.), ball (or sphere)

diameter, and the material composition of adjacent layers. It

should also be understood that the two measurement

techniques are not linearly related[.]" (PTX-604 at col. 10, ll. 14-

23)

6la

Even if the jury agreed with plaintiff that a

person of ordinary skill in the art would have

generally interpreted the prior art to disclose a Shore

D hardness of 64 or less, the jury could have

reasonably concluded that a person of ordinary skill

in the art would not have been motivated to put a

polyurethane cover on the bail of Proudfit '187 with

any expectation that such a combination would yield

an “on the ball" Shore D hardness of 64 or less.

Plaintiff presented evidence that it was known

in the industry that there were significant problems

with the Molitor '751 cover material. Dr. Risen

testified that Molitor '751 was embodied by the

Spalding Tour Edition® golf ball, which had a

polyurethane and ionomer blend cover. (D.I. 428 at

1148: 11-1149:14) Spalding replaced this cover with a

different Surlyn® ionomer blend because it was a

"big problem." (Jd.) Dr. Statz admitted on cross that

"[pleople had looked at all these resins for years,"

and a é Spalding ball with Molitor ‘751

(polyurethane/ABS’) cover, called the Executive®,

did not work. (D.I. 427 at 704:7-705:20; 733:13-

734:15 ("It broke. It was brittle. It was too hard and

too stiff.")) In the 1980s Dr. Statz helped Spalding

develop a replacement cover, which was a blend of

ionomers (with no polyurethane). (Jd. at 705:21-

706:22) Dr. Statz testified that "it wasn't a failed

cover because of the urethane, it was a failed cover

because of the blend." (/d. at 706:21-22)

Notwithstanding, Dr. Statz did not look to a

polyurethane cover solution. Similarly, Mr. Proudfit

7 Acrylonitrile butadiene styrene, a common thermoplastic.

62a

testified that putting a polyurethane cover on his

three-piece golf ball had never occurred to him. (D.I

424 at 530:9-19)

There are thousands of golf ball patents. (D.I.

423 at 177:13-18) The jury heard testimony that it

took plaintiff three years and over $170 million, with

the assistance of 25 to 40 designers, to design and

launch its Rule 35® ball; defendant spent a "period of

years developing the Pro V1®. (D.I. 428 at 1026:17-

1027:11; 1048:9-14; D.I. 424 at 427:12-17)

Mr. Kennedy testified that there are thousands

of materials (within several families of products) that

can be used to make a ball.® (D.I. 427 at 937:12-

938:8) Further, in Mr. Kennedy's experience, golf

ball designers cannot predict “what performance will

result from a particular combination of materials," so

products must be made and tested. (Jd. at 938:9-12;

941:15-944:21) Mr. Yagley testified that small

changes in "cover thickness and cover hardness and

core composition would make a big change in how

the golf ball performed." (D.I. 428 at 1022:15-18) The

relationships between the materials and the layers of

materials are “extremely complex," as is the

evaluation of performance. (Jd. at 1024:2-14) Mr.

Proudfit testified that developing a ball is "trial and

error, not predictable ...in my opinion it's not a

science." (D.I. 424 at 530:20-24) Mr. Nesbitt stated

that, in his experience as a golf ball designer, he

found that developing a ball was "[nJever predicable";

"You don't know until you try...You play around in

8 Mr. Dalton acknowledged that there is a "fairly large” number

of materials that can be used. (D.I. 424 at 510:13-15)

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the lab. You make examples, and you test and see if

it does what you think it's going to do. If it doesn't,

then you go back and make modifications." (D.I. 428

at 1128:25-1129:9) Dr. Risen also testified that the

art is unpredictable; the effect of changes on the

ultimate performance cannot be predicted with any

certainty. (Id. at 1146:22-1147:7)

As for defendant's witnesses, Mr. Sullivan

agreed that the art is "challenging." (D.I. 427 at 81

5:18-24) Mr. Cavallaro testified similarly. (D.I. 428

at 1115:11-19) (Golf ball design is not predictable, as

"just changing one particular material, one material

may perform differently than another material,

totally out of the realm of the design that you're

looking to achieve.")) Mr. Dalton affirmed that, for

certain types of materials, "even a small change in

the materials that you use to make the golf ball can

have a big consequence on the performance of the

golf ball" (D.I. 424 at 51 1:23-512:6); finding the right

combination of materials to achieve a predetermined

performance goal is “a challenging task." (Jd. at

512:20-25) Dr. Statz acknowledged that “different

combinations of core size and inner cover thickness

and outer cover thickness will lead to wildly different

performance."9 (D.I. 426 at 660:1-5)

® Plaintiff's counsel impeached Dr. Statz with his expert report,

citing a quote that, to make a multi-layer golf ball with a

polyurethane cover, a “huge amount of experimentation" and

decision-making would be required to choose the right

combination of materials. (D.I. 426 at 659:4-9) In response, Dr.

Statz backtracked, stating only that “how much

[experimentation] that would be, I don't know until you start."

(Id. at 659:10-15)

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Additionally, Dr. Risen testified that he

reviewed the prior art and reached the opposite

conclusion of Dr. Statz on obviousness. (D.I. 428 at

1141:8-1143:13) Dr. Risen outlined the import of

various pieces of prior art and the knowledge of

persons of ordinary skill in the art at the time of the

invention. With respect to Molitor '751, Dr. Risen

stated that there was no disclosure of Shore D

hardness, that the Shore C hardness values disclosed

could not be converted to Shore D values, and that

all of the examples in that patent are two-piece balls.

(Id. at 1159:11-1162:24) Dr. Risen further stated that

there was no motivation to combine Proudfit '187

and Molitor '751.1° (id. at 1168:5-1170:5) Dr. Risen

testified that Wu discloses a two-piece golf ball and a

10 Defendant preserved its objection that Dr. Risen's testimony

of "no motivation to combine" was outside the scope of his

expert report. The court finds defendant's arguments on this

issue frivolous. As an initial matter, Dr. Risen's report amptly

supports the concise testimony given at trial. (D.I. 443, ex. E at

94122, 254 ("the fact that no one succeeded in making a

urethane-over-ionomer three-piece’ ball before Sullivan strongly

suggests that persons of skill in the art either did not think to

do so, or did not think such an effort would be worth pursuing”),

255-56, 258 ("even the most skilled golf ball designers either did

not expect any benefit from such a design, did not think the

construction was possible, or did not consider the combination

at all"), 278 ("At the very least, persons of skill in the art

evidently did not expect this construction to improve

performance as much as it does; if they had, someone certainly

would have undertaken the effort to implement such a design.”)

Secondly, obviousness was the only issue tried in this case.

Plaintiff had one expert. The prejudice to defendant by the

expert's conclusion of "no motivation to combine," precisely the

opposite of what is required to prove obviousness in defendant's

case in chief, is difficult to appreciate under these

circumstances.

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wound ball, not a multi-layer ball having an inner

cover layer with the claimed properties, and contains

no disclosure of a Shore D hardness value for a cover

layer. (id. at 1163:16-1165:10) He also stated that

there was no motivation to combine Proudfit '187

and Wu. (/d. at 1170:5-13)

Finally, plaintiff presented evidence on

secondary considerations of nonobviousness.!! The

infringing Pro V1I® is undisputedly successful. In

addition to plaintiffs documents admitted at trial,

which evidence a wholesale "paradigm shift" in the

market following the introduction of the Pro VI1®,!2

11 [S]Jecondary considerations as commercial success, long felt

but unsolved needs, failure of others, etc., might be utilized to

give light to the circumstances surrounding the origin of the

subject matter sought to be patented." KSR Int'l Co. v. Teleflex

Inc., — U.S.—, 127 S.Ct. 1727, 1734 (2007) (quoting Graham v.

John Deere Co., 383 U.S. 1, 17-18 (1966)).

Plaintiff was required to present a prima facie case that

a nexus existed between the patented feature and the

commercial success of the product(s) embodying the patented

invention. Defendant stipulated to infringement in this case

and, having done so, it became defendant's burden to rebut

plaintiffs prima facie showing that the success of the Pro V1®

was attributable to the patented invention. See Demaco Corp. v.

F. Von Lagsdorff Licensing Lid., 851 F.2d 1387, 1393 (Fed. Cir.

1988) (Plaintiff "is not required to prove as a part of its prima

facie case [of a nexus between the patented feature and the

claimed success] that the commercial success is not due to

factors other than the patented invention. It is sufficient to

show that the commercial success was of the patented invention

itself. A requirement for proof of all of the negative of all

imaginable contributing factors would be unfairly

burdensome{.]").

2 E.g., PTX-722; PTX-723; PTX-1195 ("[T]he speed at which

this all took place is unprecedented, especially as it related to

increasing capacity to meet the demand. I think it is the most

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Mr. Bellis testified that the Pro VI® is the most

preferred and played ball by tour professionals and

average-skill golfers. (D.I. 424 at 275:24-276:8 ("I

think one of [the] major reasons for [its] success is its

total performance or excellent performance across

many different areas[.]")) Mr. Morgan acknowledged

that the patented features contribute to the

performance of the Pro VIO. (PTX-1121; D.I. 424 at

436:14-23 (ionomer casing for speed enhancement

and spin control); 437:17-438:8 (polyurethane cover

for control and imparting spin)) Dr. Risen testified

that the Pro VIO satisfied the long-felt need in the

industry for a ball having the _ favorable

characteristics of both distance balls and wound

balls. (D.I. 428 at 1176:15-1177:11)

2. Wilson Ultra Tour Balata!® ball in

view of Molitor '751 or Wu

Defendant asserts that it presented ample

clear and convincing evidence at trial that the

Wilson Ultra Tour Balata ball that was on sale in

1993 had all of the features of the asserted claims

with the exception of a polyurethane cover layer, and

that it would have been obvious to use a

polyurethane cover layer as disclosed in Molitor '751

or Wu. (D.I. 417 at 16) Defendant claims that JMOL

massive paradigm shift ever seen in the golf ball category, and

certainly the most intense and accelerated one in any product

category I've ever witnessed." (George Sine, defendant's Vice

President of golf ball marketing and strategic planning) (2001))

13 Generally, balata is a latex used as a cover material for golf

balls. It is not exceptionally durable.

67a

is appropriate because its evidence was wholly

uncontroverted by plaintiff at trial. (/d.) Plaintiff

does not point to any of its own evidence in this

regard. (D.I. 455 at 18-20) Rather, plaintiff asserts

that defendant did not meet its burden to establish

that the Ultra Tour Balata ball had an inner cover

layer comprising a blend of low-acid ionomers, at

least one of which was a low-acid ionomer, as

required by the Sullivan patents. Dr. Statz testified

that he learned that the Ultra Tour Balata had this

ionomer blend through discussions with Mr. Proudfit

when visiting the Wilson manufacturing facility -not

through public information. (D.I. 426 at 700:11-

703:19) The Ultra Tour Balata ball packaging

included the Proudfit ’187 patent number, but claim

1 of that patent requires only an "ionomer resin," as

compared to a blend. (D.I. 429 at 1289-90) Finally,

plaintiff reiterates its arguments regarding the lack

of a motivation to combine and a reasonable

expectation of success in view of known problems

with polyurethane covers of the original Tour

Edition® ball.

In response, defendant highlights test data

showing that the Ultra Tour Balata ball satisfies all

of the claimed properties except for the polyurethane

cover. (D.I. 465 at 7) There is no indication that this

information would have been available to persons of

ordinary skill in the art; conversely,

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