Sinorgchem Co., Shandong v. Intern. Trade Com'n

• Citation: 511 F.3d 1132
• Decision Date: 21 December 2007
• Docket Number: No. 2006-1633.,2006-1633.
• Parties: SINORGCHEM CO., SHANDONG, Appellant, v. INTERNATIONAL TRADE COMMISSION, Appellee, and Flexsys America L.P., Intervenor.
• Court: United States Courts of Appeals. United States Court of Appeals for the Federal Circuit

511 F.3d 1132

SINORGCHEM CO., SHANDONG, Appellant, v. INTERNATIONAL TRADE COMMISSION, Appellee, and Flexsys America L.P., Intervenor.

No. 2006-1633.

United States Court of Appeals, Federal Circuit.

December 21, 2007.

Carter G. Phillips, Sidley Austin LLP, of Washington, DC, argued for appellant. With him on the brief were Stephen B. Kinnaird, Stanton T. Lawrence, III, and Paul J. Zegger. Of counsel was Ruthanne Mary Deutsch. Of counsel on the brief were Manni Li, Perkins Coie LLP, of Santa Monica, CA, and Joan Ellis, Venable LLP, of Washington, DC.

James A. Worth, Attorney, Office of the General Counsel, United States International Trade Commission, of Washington, DC, argued for appellee. With him on the brief were James M. Lyons, General Counsel, and Wayne W. Herrington, Assistant General Counsel. Of counsel was Neal J. Reynolds, Attorney.

Mark G. Davis, McDermott, Will & Emery LLP, of Washington, DC, argued for intervenor. With him on the brief were Bureden J. Warren, of Washington, DC, and Leonard D. Conapinski, of Chicago, IL. Of counsel on the brief was Eric C. Cohen, Katten Muchin Rosenman LLP, of Chicago, IL. Of counsel were Raphael V. Lupo, and Natalia V. Blinkova, McDermott, Will & Emery LLP, of Washington, DC; and David C. Minc, Flexsys America L.P., of Akron, OH.

Before NEWMAN and DYK, Circuit Judges, and YEAKEL, District Judge.^*

Opinion for the court by Ciruict Judge DYK. Dissenting opinion filed by Circuit Judge NEWAN.

DYK, Circuit Judge.

Appellant Sinorgchem Co., Shandong ("Sinorgchem") appeals from a limited exclusion order of the International Trade Commission ("ITC") based on a finding that Sinorgchem infringed four method claims of U.S. Patents 5,117,063 ("the '063 patent") and 5,608,111 ("the '111 patent") owned by intervenor Flexsys America L.P. ("Flexsys"). In re Certain Rubber Antidegradants, Components Thereof, and Products Containing Same, No. 337-TA-533 (I.T.C. July 13, 2006) (commission opinion). Because the ITC's determination of infringement was based on an erroneous construction of the term "controlled amount" in the claims at issue, and under the correct construction Sinorgchem does not literally infringe, we vacate and remand.

BACKGROUND

Sinorgchem produces in China and sells for importation to the United States a compound known as 6PPD, a rubber antidegradant that counters the deteriorative effect of various environmental factors on tires. 6PPD is made from an intermediate compound, 4-aminodiphenylamine, or 4-ADPA, which Sinorgchem also makes in China. In turn, Sinorgchem makes the intermediates of 4-ADPA using a process that reacts aniline and nitrobenzene. In that reaction, aniline is a solvent, tetramethylammonium hydroxide ("TMAH") is a base, and water is a protic material. The term "protic material" refers to proton donors. The amount of water used in the condensation reaction of nitrobenzene with aniline is at least 10 to 15% water throughout the reaction.

The issue is whether Sinorgchem's method for producing 6PPD and 4-ADPA infringes the asserted method claims of the '063 and '111 patents, owned by Flexsys. The '111 patent issued from a continuation-in-part application to the application that led to the '063 patent and is subject to a terminal disclaimer based on the earlier filed '063 patent. The specification of the '111 patent includes additional Examples 13 through 21 but is otherwise substantially identical to the '063 patent specification. The parties agree that the term "controlled amount" in both patents should receive the same construction.

At issue are independent claims 30 and 61 of the '063 patent and claims 7 and 11 of the '111 patent. These claims describe methods for producing 4-ADPA and 6PPD. Claim 61 of the '063 patent is representative:

61. A method of producing alkylated p-phenylenediamines [6PPD] comprising the steps of:

a) bringing aniline and nitrobenzene into reactive contact in a suitable solvent system;

b) reacting the aniline and nitrobenzene in a confined zone at a suitable temperature, and in the presence of a suitable base and controlled amount of protic material to produce one or more 4-ADPA intermediates;

c) reducing the 4-ADPA intermediates to produce 4-ADPA; and

d) reductively alkylating the 4-ADPA of Step c) [which produces 6PPD].

'063 patent col.15 ll.34-46. The central question is whether Sinorgchem's method of producing 4-ADPA intermediates satisfies the claim limitations of step (b). There is no dispute that Sinorgchem utilizes steps (a), (c), and (d). The ITC and the private parties particularly focus on a portion of the specification that states: "A `controlled amount' of protic material is an amount up to that which inhibits the reaction of aniline with nitrobenzene, e.g., up to about 4% H₂O based on the volume of the reaction mixture when aniline is utilized as the solvent." Id. at col.4 ll.48-52.

On February 23, 2005, Flexsys filed a complaint with the ITC alleging, among other things, that Sinorgchem was infringing claims 30 or 61 of the '063 patent or claims 7 or 11 of the '111 patent, and had violated subsection (a)(1)(B) of section 337 of the Tariff Act of 1930, which makes unlawful the importation of articles that either infringe a valid U.S. patent or are produced by a process covered by the claims of a valid U.S. patent. 19 U.S.C. § 1337(a)(1)(B) (2000). The administrative law judge ("ALJ") issued a final initial determination ("final ID") on February 17, 2006, holding that Sinorgchem had infringed the claims and violated section 337. In re Certain Rubber Antidegradants, No. 337-TA-533 (I.T.C. Feb. 17, 2006) (final initial and recommended determinations).

Central to the dispute before the ALJ was the claim construction of the term "controlled amount of protic material" found in each of the asserted independent claims. Sinorgchem urged the ALJ to adopt a construction of "controlled amount of protic material" as "up to about 4% water in the reaction mixture when aniline is the solvent." J.A. at 108-09. Under this construction, Sinorgchem does not infringe because its process uses more than 4% water.

Flexsys argued that "controlled amount" meant "that the amount of protic material should be controlled between an upper limit and a lower limit," where the upper limit was "that amount beyond which the reaction between nitrobenzene and aniline is inhibited," and the lower limit was "that amount below which the desired selectivity for 4-ADPA intermediates is not maintained." J.A. at 108. Under Flexsys's claim construction, the Sinorgchem process would infringe.

The ALJ rejected Sinorgchem's construction and adopted Flexsys's construction of the term "controlled amount." Based on this construction, the ALJ concluded that (1) Sinorgchem's processes for making 4-ADPA and 6PPD literally infringed the asserted claims, (2) the claims as construed were not invalid as indefinite, and (3) the claims were not invalid as obvious in view of the prior art.

On appeal, the ITC rejected the construction of "controlled amount" urged by Flexsys and adopted by the ALJ. It found that the patentee in the specification had acted as his own lexicographer and expressly defined the meaning of "controlled amount" of protic material as "an amount up to that which inhibits the reaction of aniline with nitrobenzene." J.A. at 227. However, it excluded from that construction the second clause of the sentence, which stated "e.g., up to about 4% H₂O based on the volume of the reaction mixture when aniline is utilized as the solvent." The ITC read the 4% water limit as inconsistent with other general language found in the same paragraph (quoted below), which the ITC interpreted as teaching that the amount of protic material can change based on other reaction conditions, even where aniline is used as the solvent. Similarly, the ITC read the 4% limit as inconsistent with the reaction in Example 10, where a calculated 10% water level was utilized.

The ITC construed "controlled amount" as specifying an upper limit determined by when protic material "inhibits the reaction of aniline with nitrobenzene." J.A. at 227. The ITC found that "inhibits" meant inhibits "to the extent where the reaction is no longer significant," J.A. at 232, and that "significant" in turn meant that the "minimum acceptable conversion rate would be more than 12% but less than 63%," J.A. at 233-34. In determining what was "significant," the ITC looked to Example 8 for the conversion rate of nitrobenzene at which a reaction would be considered significant. It found that when DMSO was the solvent, the conversion rate of nitrobenzene drops from 63 to 12% when the amount of water increases from 6 to 9.75%. Sinorgchem's process, the ITC determined, yields a conversion rate of around 85%. Under this new construction of the disputed term "controlled amount," the ITC likewise found infringement.

The ITC next concluded that the claims as construed were not invalid as indefinite. Although the ITC rejected the 4% water limit, it found that "controlled amount" was not indefinite since an upper limit — where the amount of protic material yields an acceptable conversion rate between 12 and 63% — could be found in the specification. Given this definition of "controlled amount," the ITC rejected Sinorgchem's argument that the claims were indefinite.

As to obviousness, the ITC held that while the asserted prior art — a 1903 German article published by Wohl (the "Wohl" reference) — disclosed the reaction of aniline with nitrobenzene, the formation of a small amount of intermediate, and the presence of water as a protic material, it failed to disclose or teach "whether or how water or any other protic material affects the conversion of nitrobenzene." J.A. at 245.

Sinorgchem timely appealed the ITC's decision to our court. We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(6).

DISCUSSION

I

The main issue on appeal is the meaning of the claim term "controlled amount." The parties...