Memc Electronic Materials, Inc. v. Mitsubishi Mater. Silicon

• Decision Date: 22 August 2005
• Docket Number: No. 04-1396.,No. 04-1513.,04-1396.,04-1513.
• Citation: 420 F.3d 1369
• Parties: MEMC ELECTRONIC MATERIALS, INC., Plaintiff-Appellant, v. MITSUBISHI MATERIALS SILICON CORPORATION, Mitsubishi Silicon America Corporation, Sumitomo Mitsubishi Silicon Corporation (also known as Sumco), Sumco USA Corporation (also known as Sumco USA), and Sumco USA Sales Corporation (also known as Sumco USA Sales), Defendants-Cross Appellants.
• Court: U.S. Court of Appeals — Federal Circuit

420 F.3d 1369

MEMC ELECTRONIC MATERIALS, INC., Plaintiff-Appellant, v. MITSUBISHI MATERIALS SILICON CORPORATION, Mitsubishi Silicon America Corporation, Sumitomo Mitsubishi Silicon Corporation (also known as Sumco), Sumco USA Corporation (also known as Sumco USA), and Sumco USA Sales Corporation (also known as Sumco USA Sales), Defendants-Cross Appellants.

No. 04-1396.

No. 04-1513.

United States Court of Appeals, Federal Circuit.

August 22, 2005.

Robert M. Evans, Jr., Senniger Powers, of St. Louis, Missouri, argued for plaintiff-appellant. With him on the brief was Marc W. Vander Tuig. Of counsel on the brief were Duane H. Mathiowetz and Korula T. Cherian, Howrey Simon Arnold & White, LLP, of San Francisco, California.

R. Terrance Rader, Rader, Fishman & Grauer PLLC, of Bloomfield Hills, Michigan, argued for defendants-cross appellants. With him on the brief were David T. Nikaido and Glenn E. Forbis. Of counsel were Ellen A. Efros and Lisa R. Mikalonis.

Before NEWMAN, SCHALL, and DYK, Circuit Judges.

SCHALL, Circuit Judge.

MEMC Electronic Materials, Inc. ("MEMC") is the assignee of record of U.S. Patent No. 5,919,302 (the "'302 patent"). It brought suit in the United States District Court for the Northern District of California against Mitsubishi Materials Silicon Corporation, Mitsubishi Silicon America Corporation, Sumitomo Mitsubishi Silicon Corporation ("SUMCO Corp."), Sumco USA Corporation ("SUMCO USA"), and Sumco USA Sales Corporation ("SUMCO USA Sales") (collectively, "defendants" or "SUMCO"). In its suit, MEMC alleged direct infringement of the '302 patent under 35 U.S.C. § 271(a) and inducement of infringement of the patent under 35 U.S.C. § 271(b). The district court eventually granted summary judgment in favor of defendants on the ground that, as a matter of law, they could not be liable for either direct infringement or inducement of infringement. MEMC Elec. Materials, Inc. v. Mitsubishi Materials Silicon Corp., No. 4:01-CV-04925 (N.D.Cal. Mar. 16, 2004) ("Summary Judgment Order"). As far as direct infringement was concerned, the court ruled that there was no evidence of sales or offers for sale of accused products in the United States. As far as inducement of infringement was concerned, the court ruled that MEMC had failed to produce any evidence of inducement of infringement by defendants. MEMC now appeals that decision. At the same time, defendants cross-appeal the district court's denial of their motion for attorney's fees, expert witness fees, and expenses.

We see no error in the grant of summary judgment with respect to direct infringement. However, in view of what we think are genuine issues of material fact, we hold the district court did err in granting summary judgment with respect to inducement of infringement. Accordingly, with respect to MEMC's appeal, the judgment of the district court is affirmed-in-part and reversed-in-part and the case is remanded to the district court for further proceedings. On the cross-appeal, we affirm the denial of defendants' request for attorney's fees.

I.

MEMC is a supplier of silicon wafers to the semiconductor industry. The '302 patent, entitled "Low Defect Density Vacancy Dominated Silicon," relates to the preparation of semiconductor grade single crystal silicon, which is used, in wafer form, in the manufacture of electronic components such as integrated circuits. '302 patent col. 1, ll. 9-16. Prior art methods of manufacturing single crystal silicon often resulted in crystals containing large quantities of agglomerated intrinsic point defects. Id. col. 1, ll. 18-55. These defects can severely impact the yield potential of silicon wafers in complex and highly integrated circuits. Id. col. 1, ll. 53-55. The patent discloses a method of preparing single crystal silicon that is substantially free of agglomerated intrinsic point defects. Specifically, the '302 patent discloses a process specifying initial growth conditions and the temperature range of the manufacturing process. Id. col. 3, l. 62 — col. 4, l. 14.

Claim 1, the only asserted independent claim of the '302 patent, states as follows:

1. A single crystal silicon wafer having a central axis, a front side and a back side which are generally perpendicular to the central axis, a circumferential edge, and a radius extending from the central axis to the circumferential edge of the wafer, the wafer comprising

a first axially symmetric region in which vacancies are the predominant intrinsic point defect and which is substantially free of agglomerated vacancy intrinsic point defects wherein the first axially symmetric region comprises the central axis or has a width of at least about 15 mm.

'302 patent col. 23, ll. 17-23.

SUMCO, like MEMC, is a supplier of silicon wafers to the semiconductor industry. It is undisputed that SUMCO's silicon wafers are manufactured exclusively outside of the United States at SUMCO's manufacturing plant in Yonezawa, Japan. Ostensibly, SUMCO sells silicon wafers to Samsung Japan Corporation ("Samsung Japan"), which then sells the wafers to Samsung Austin Semiconductor, located in Austin, Texas ("Samsung Austin").¹

On December 14, 2001, MEMC sued SUMCO in the United States District Court for the Northern District of California, claiming that SUMCO was liable for infringement and inducement of infringement of the '302 patent based upon SUMCO's alleged sale and importation of certain silicon wafers.² MEMC asserted that SUMCO directly infringed the '302 patent under 35 U.S.C. § 271(a) by offering to sell and selling the accused wafers to Samsung Austin. With respect to its claim of inducement of infringement under 35 U.S.C. § 271(b), MEMC asserted that SUMCO encouraged and enabled Samsung Austin to use the accused wafers by manufacturing wafers according to Samsung Korea's specifications and by providing technical support to the Samsung Austin facility.

II.

On December 3, 2003, SUMCO filed a motion for summary judgment of zero damages, arguing that MEMC could not prove that defendants committed the alleged acts of infringement within the United States. SUMCO argued that it did not sell the accused wafers either directly or indirectly to Samsung Austin, and that it only sold the accused wafers to Samsung Japan. SUMCO also argued that it had not engaged in any conduct that would constitute the active inducement of infringement by Samsung Austin in the United States.

MEMC responded that Samsung Japan was merely a conduit for the delivery of defendants' accused wafers and that Samsung Austin was SUMCO's true customer. MEMC also argued that defendants induced Samsung Austin's infringement of the '302 patent by manufacturing wafers according to Samsung Austin's specifications and by providing substantial technical support to Samsung Austin.

On March 16, 2004, the district court granted defendants' summary judgment motion. The court held that MEMC had failed to produce any evidence of sales or offers for sales of the accused wafers in the United States by defendants or any evidence of importation of the accused wafers into the United States by defendants. Summary Judgment Order, slip op. at 2. The court also held that, vis-à-vis Samsung Austin, MEMC had failed to provide any evidence of active and intentional inducement of infringement by defendants. Id. On April 22, 2004, the district court entered final judgment of non-infringement. Under these circumstances, the court reasoned, MEMC could not establish entitlement to any damages. Id. On May 20, 2004, SUMCO filed a motion for attorney's fees, expert witness fees, and expenses. The district court denied this motion on July 9, 2004. MEMC Elec. Materials, Inc. v. Mitsubishi Materials Silicon Corp., No. 4:01-CV-04925 (N.D.Cal. July 9, 2004) ("Attorney's Fees Order").

MEMC appeals the district court's final determination of non-infringement as well as the underlying order granting SUMCO summary judgment of zero damages. SUMCO cross-appeals the district court's denial of its motion for attorney's fees, expert witness fees, and expenses. We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(1).

DISCUSSION

I.

Summary judgment is appropriate only if, when the facts are viewed in the light most favorable to the nonmoving party and all doubts are resolved against the movant, there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Fed. R.Civ.P. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); see also Caterpillar, Inc. v. Deere & Co., 224 F.3d 1374, 1379 (Fed.Cir.2000) ("When ruling on a motion for summary judgment, all of the nonmovant's evidence is to be credited, and all justifiable inferences are to be drawn in the nonmovant's favor."). The movant carries the initial burden of proving that there are no genuine issues of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 322-24, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). If the movant shows a prima facie case for summary judgment, then the burden of production shifts to the nonmovant to present specific evidence indicating there is a genuine issue for trial. Anderson, 477 U.S. at 250, 106 S.Ct. 2505. This court reviews de novo the district court's finding that there is no genuine issue as to any material fact regarding infringement. Amgen, Inc. v. Hoechst Marion Roussel, Inc., 314 F.3d 1313, 1339 (Fed.Cir.2003).

The district court based its ruling of non-infringement on MEMC's inability to establish damages for infringement and, thus, did not address the issue of claim coverage with respect to the '302 patent. Accordingly, we assume for purposes of this appeal that the asserted claims of the '302 patent read on the accused wafers. We turn first to the issue of direct infringement.

II.

The following facts are not in dispute: SUMCO sells the accused silicon wafers to Samsung Japan, which then sells the wafers to Samsung Austin. As noted above, the wafers are...