503 F.2d 745 (7th Cir. 1974), 73-1716, Skil Corp. v. Lucerne Products, Inc.

Docket Nº:73-1716.
Citation:503 F.2d 745
Party Name:183 U.S.P.Q. 396 SKIL CORPORATION, Plaintiff-Appellee, v. LUCERNE PRODUCTS, INC., Defendant-Appellant.
Case Date:October 04, 1974
Court:United States Courts of Appeals, Court of Appeals for the Seventh Circuit
 
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Page 745

503 F.2d 745 (7th Cir. 1974)

183 U.S.P.Q. 396

SKIL CORPORATION, Plaintiff-Appellee,

v.

LUCERNE PRODUCTS, INC., Defendant-Appellant.

No. 73-1716.

United States Court of Appeals, Seventh Circuit

October 4, 1974

Heard May 23, 1974.

Rehearings Denied Oct. 23, 1974 and

Nov. 12, 1974.

James Van Santen and Lewis T. Steadman, Chicago, Ill., for defendant-appellant.

Clarence J. Fleming, Thomas A. Reynolds, Jr., Chicago, Ill., for plaintiff-appellee.

Before CUMMINGS and TONE, Circuit Judges, and MATTHES, [*] Senior Circuit Judge.

Page 746

TONE, Circuit Judge.

This is an appeal by defendant Lucerne Products, Inc. from a judgment holding Claim 5 of plaintiff Skil Corporation's Reissue Patent No. 26,781 valid and infringed, declaring defendant Lucerne Products, Inc.'s Patent No. 3,389,365 invalid under 35 U.S.C. 102(b) because of sales more than one year before the application was filed, and awarding attorneys' fees to plaintiff by reason of defendant's conduct in seeking to defend the latter patent. Both patents cover speed control devices for switches in variable speed portable electric drills.

Skil manufactures and sells power tools, including variable speed portable electric drills. Lucerne manufactures and sells electric switches that are used in power tools.

The switches involved in this case are mounted in the trigger assembly of the drill. To vary the speed of the drill's electric motor, a rheostat is mounted in the spring-loaded movable trigger of the drill, and as the trigger is depressed or released the rheostat moves, thereby changing the resistance in the circuit of the motor and thus the speed of the motor.

Early in 1964, Skil negotiated a contract with Benjamin H. Matthews, Lucerne's president and principal stockholder, calling for the development by Lucerne of a trigger speed control switch for Skil electric drills. Skil placed a purchase order for 100,000 speed control switches to be delivered over an 18-month period, subject, however, to approval of the switch by Underwriters' Laboratories.

Matthews first developed a switch containing a 'horizontal' rheostat, which was a flat strip of carbon-coated material mounted in the trigger mechanism on a horizontal plane. This mechanism proved defective in certain respects, and Matthews redesigned the switch, rotating the strip 90 degrees, putting it on a vertical plane, and formed the movable contact as a sliding clamp with spring fingers on either side of the strip. Triggers incorporating the 'vertical' rheostat were shipped to Skil in August 1964. Before August 23, 1964, over 1400 switches with either the horizontal or the vertical rheostat were shipped to Skil and credited against the purchase order for 100,000. Skil drills manufactured beginning in early August contained the vertical rheostat switches. By the end of August 1964, Skil sold 449 drills containing the Matthews switch to the public. On September 3, 1964, Underwriters' Laboratories approved the switch. On August 23, 1965, Matthews filed a patent application on the switch, which resulted in the issuance of U.S. Patent 3,389,365.

Sometime after it commenced manufacturing and selling drills containing the vertical rheostat Lucerne switch, Skil decided that a fine speed adjustability feature should be added to the switch. The project of developing this feature was assigned to Carl Frenzel, a Skil engineer. Frenzel successfully completed his assignment in the manner described below and on December 27, 1965, an application for patent was filed on his behalf. The application was 'made special,' i.e., given accelerated treatment at the request of the applicant upon his presentation to the Patent Office of the results of a prior art search which, he represented, contained the most recent prior art. U.S. Patent Letter 3,309,484, containing ten claims, was issued on Frenzel's application on March 14, 1967. Over a year later Frenzel filed an application for reissue of the patent based on a second version of the adjustability feature. U.S. Reissue Patent 26,781 containing the original ten claims and additional claims 11 to 14, was granted on February 3, 1970.

Lucerne developed, for sales to other customers after the eighteen month exclusive contract with Skil expired, a speed control adjustability mechanism different from the one...

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