425 F.2d 1114 (2nd Cir. 1970), 538-539, Barr Rubber Products Co. v. Sun Rubber Co.

Docket Nº:538-539, 32319, 32320.
Citation:425 F.2d 1114, 165 U.S.P.Q. 42
Party Name:The BARR RUBBER PRODUCTS COMPANY, Plaintiff-Appellee-Cross Appellant, v. The SUN RUBBER COMPANY, Defendant-Appellant-Cross Appellee, and Wonder Products Company, Defendant.
Case Date:April 30, 1970
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit

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425 F.2d 1114 (2nd Cir. 1970)

165 U.S.P.Q. 42

The BARR RUBBER PRODUCTS COMPANY, Plaintiff-Appellee-Cross Appellant,


The SUN RUBBER COMPANY, Defendant-Appellant-Cross Appellee, and Wonder Products Company, Defendant.

Nos. 538-539, 32319, 32320.

United States Court of Appeals, Second Circuit.

April 30, 1970

Argued June 4, 1969.

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[Copyrighted Material Omitted]

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Jacobs, Persinger & Parker, New York City, Ely, Golrick & Flynn, Albert L. Ely, Jr., Cleveland, Ohio, for the Barr Rubber Products Co.

Paul W. Williams, Allen S. Joslyn, Lawrence C. Browne, Cahill, Gordon, Sonnett, Reindel & Ohl, New York City, for amicus curiae, McNeil Corp.

Before WATERMAN, FRIENDLY and KAUFMAN, Circuit Judges.

WATERMAN, Circuit Judge.

The Sun Rubber Company (Sun) and the Barr Rubber Products Company (Barr) are competing manufacturers of plastic toys. Sun Rubber is the holder of a patent, U.S. Patent No. 2,629,134, issued February 24, 1953, on an application filed June 27, 1950, which describes a process for producing flexible hollow articles, such as balls, dolls and other toys from plastic. The process requires that a mold containing a liquid mixture of vinyl resin and plasticizer (commonly known as a vinyl plastisol) be rotated slowly on several different axes while heat is applied at single high temperature. The rotation causes the liquid to spread evenly along the inner well of the mold, and the heat then causes the liquid first to solidify (gell) and then to harden (fuse) around the mold. Thereafter, the mold is cooled and the finished object so produced is removed. Earlier procedures, principally so-called slush casting, first gelled the plastisol at a temperature around 200 degrees and then fused the gell at higher temperatures which, depending upon the desired thickness of the article to be produced, ranged

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from 300 to 350 degrees F. Concededly there are numerous advantages of a single temperature process over the other methods employed in the industry for molding articles of plastisol: the weight of the product is more accurately controlled; the time of manufacture, formerly consuming a day or more, is reduced to a fraction of an hour; shrinkage of the article produced is significantly less; distortion and tearing are largely eliminated; and scrap is minimized. Consequently, the process set forth in Sun's patent appears now to be the preferred means for producing plastisol products commercially. Since the issuance of the patent Sun has licensed it to about twenty producers in the United States who have paid approximately 1,000,000 in royalties.

As is not infrequently the case, the commercial success of a patent tends to generate litigation. The validity of Sun's patent was first subjected to judicial adjudication more than a decade ago in an action for infringement brought by Sun against National Latex Products Company and Akron Presform Mold Company in the United States District Court for the Northern District of Ohio. After a ten day trial, during which motion pictures were shown concerning the operation of the Sun process and in which considerable expert testimony was brought forth, the district court rejected defenses of patent misuse and of patent invalidity based upon obviousness and anticipation and held Sun's patent valid. Sun Rubber Co. v. National Latex Products Co., 159 F.Supp. 661 (N.D.Ohio 1958). On appeal the Sixth Circuit (2-1) affirmed, 274 F.2d 224 (6 Cir. 1959), cert. denied, 362 U.S. 989, 80 S.Ct. 1078, 4 L.Ed.2d 1022 (1960).

In this present action, commenced by the Barr Rubber Company on November 3, 1960, the validity of Sun's patent is again challenged. 1 Barr's complaint sought a declaratory judgment of patent invalidity, or, if the patent should be held valid, a declaratory judgment of noninfringement or nonenforceability. Additionally, the complaint sought damages for and injunctive relief from alleged unfair competition by Sun, and from conspiracies in violation of the antitrust laws between Sun and the wonder Products Company and between Sun and an unnamed machinery manufacturer and an unnamed manufacturer of plastisol components. 2 Sun counterclaimed, alleging infringement of its patent and unfair competition by Barr and, on its part, sought injunctive relief and damages. 3

With the pretrial proceedings thought to be nearing completion after a space of four and one half years and after the taking of over 6000 pages of pretrial deposition testimony, Barr moved, pursuant to Rule 20, Fed.R. Civ.P., to join the McNeil Corporation and the B.F. Goodrich Company as party defendants, claiming to have finally unmasked the identities of the unnamed machinery manufacturer and the unnamed manufacturer of plastisol components referred to in the complaint. The motion, addressed to District Judge (now Circuit Judge) Feinberg who had been assigned to the case under the Southern District

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Court Rules as a Rule 2 judge, was denied by him on the ground that the joinder of two additional parties at such a late date would unnecessarily delay the trial for years.

Following approximately another year and a half of additional discovery and various motions not particularly relevant to this appeal, 4 this bitterly contested litigation finally came on for trial on December 5, 1966 before Judge Frankel, who had replaced Judge Feinberg upon the latter's appointment, in the interim, to our Court of Appeals. Contrary to the holdings in the earlier Ohio litigation, the court below, purportedly relying upon three separate and distinct grounds, this time after a seven week trial, held Sun's patent invalid and unenforceable. Noting that Sun does not claim any invention with respect to the composition or formulation of properties of plastisols and that rotational casting is a 100 year old process at the very least, the court found Sun's invention is not a unique discovery but merely an obvious combination of old and wellknown elements, and therefore does not satisfy the requirements of patentability set forth in 35 U.S.C. 103. 5 The court disposed of the claim that the invention lay in a continuous application of a single heat source rather than in a two-step process by characterizing it as a 'baseless after-thought' and a 'recently contrived, trivial, misleading irrelevancy,' which was inconsistent with the theory of invention advanced by Sun and accepted by the two courts in the Ohio case. After a comparative analysis of the Sun patent with an earlier Italian patent (Delacoste, No. 440,295) issued by the Italian Government on October 9, 1948, the court also concluded that the teachings of the Italian patent anticipated everything the Sun patent allegedly taught, and, accordingly, under 35 U.S.C. 102(b) 6 the Sun invention was not entitled to patentability. 7 Finally, Sun was denied enforcement of its patent on the ground that the judges of the Sixth Circuit and the Ohio district judge were perjuriously misled in material respects by Sun. Specifically, the court below held that Sun by its witnesses and through its documentary evidence deliberately misrepresented to the Ohio court that the date of invention of its patent was April 1948 when the process was not actually discovered until several months later. Upon a post-trial application the court found, in the light of the last ruling, that this was an 'exceptional case' within the meaning of

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35 U.S.C. 285 8 and in a subsequent opinion awarded Barr Rubber $60,179.68 in attorneys' fees. Furthermore, for purpose of full adjudication, the district court alternatively held that if it should be held upon appeal that Sun Rubber's patent is, contrary to the district court's holding, valid and enforceable, then Barr Rubber is an infringer. Basing its holding upon its finding of 'unclean hands' the court dismissed Sun's counterclaims for injunctive relief. Barr's antitrust and unfair competition charges against Sun and its alleged conspirators were dismissed as unproven, as were Sun's quests for damages, for infringement, and for unfair competition.

These decisions are reported at 277 F.Supp. 484 (S.D.N.Y. 1967) and 279 F.Supp. 49 (S.D.N.Y. 1968).

Both parties appeal. Sun Rubber challenges the court's determination that its patent is invalid and the court's award of attorney fees to Barr. Barr Rubber contests the dismissal of the antitrust and unfair competition claims, the alternative finding of infringement if the patent should be upheld upon appeal, the method by which the amount of the award of attorney fees was computed, the interlocutory order denying its requested joinder of the McNeil Corporation and the B. F. Goodrich Company as defendants, the denial of a motion for summary judgment that Sun's patent is invalid for violations of 35 U.S.C. 184, 185, 9 and the denial of a motion it had made for the production of documents. In addition, on the day of oral argument in the Court of Appeals, Sun filed motions with us upon which we reserved decision until the writing of the opinion, in which Sun sought to have us take judicial notice of certain public documents and to have us order Barr Rubber to pay one half the cost of printing the parties' joint appendix inasmuch as both sides have appealed. We turn now to an examination of all these various issues.


Although the district court purported to be resting its determination that Sun's patent was invalid on three independent bases, the conclusion is inescapable that the finding of perjury influenced the court's disposition of the other two questions, obviousness and anticipation. The district court opinion explicitly states that plaintiff's showing that falsified evidence had been introduced

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both in the Sixth Circuit and in the trial of the instant case constituted the most significant...

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