Del. Valley Floral Group Inc v. Nets

Decision Date11 March 2010
Docket NumberNo. 2009-1357.,2009-1357.
PartiesDELAWARE VALLEY FLORAL GROUP, INC., (formerly known as Flower Transfers, Inc. and Delaware Valley Wholesale Florist, Inc.) and Esprit Miami, Inc., Plaintiffs-Appellees, and Superior Florals, Inc., Plaintiff-Appellee, and Choice Farms Corp., Plaintiff-Appellee, and Continental Farms, LLC and Continental Flowers, Inc., Plaintiffs-Appellees, and Olamor Flowers, Inc., Plaintiff, v. SHAW ROSE NETS, LLC and Kenneth P. Shaw, Defendants-Appellants.
CourtU.S. Court of Appeals — Federal Circuit

COPYRIGHT MATERIAL OMITTED

Ury Fischer, Lott & Friedland, P.A., of Coral Gables, FL, argued for all plaintiffsappellees. With him on the brief for Continental Farms, LLC, et al., was Geoffrey Lottenberg.

James A. Gale, Feldman Gale, P.A., of Miami, FL, for plaintiffs-appellees, Delaware Valley Floral Group, Inc., et al. With him on the brief was Richard Guerra.

Ted H. Bartelstone, Ted H. Bartelstone P.A., of Miami, FL, for plaintiff-appellee Superior Florals, Inc.

Steven R. Reininger, Rasco Klock Reininger Perez Esquenazi Vigil & Nieto, P.L of Coral Gables, FL, for plaintiff-appellee Choice Farms Corp.

Rhett Traband, Broad and Cassel, of Miami, FL, argued for defendants-appellants.

Before BRYSON, LINN, and PROST Circuit Judges.

PROST, Circuit Judge.

Appellants Shaw Rose Nets, LLC and Kenneth P. Shaw ("Mr.Shaw") (collectively, "Shaw") appeal a final judgment in a patent infringement case in favor of Plaintiffs-Appellees Delaware Valley Floral Group, Inc. (formerly known as Flower Transfers, Inc. and Delaware Valley Wholesale Florist, Inc.) and Esprit Miami Inc., and Superior Florals, Inc., and Choice Farms Corp., and Continental Farms, LLC and Continental Flowers, Inc., and Olamor Flowers, Inc. (collectively, "Plaintiffs"). Shaw appeals the district court's grant of summary judgment that U.S. Patent No. 5, 765, 305 ("'305 patent") is invalid based on the application of the on-sale bar pursuant to 35 U.S.C, § 102(b), and the court's subsequent denial of its motion for reconsideration. We affirm.

BACKGROUND

It is undisputed that Mr. Shaw is the inventor and owner of the '305 patent, applied for on January 16, 1996 and issued on June 16, 1998. The '305 patent describes a process that produces larger rose heads by placing elastic, porous nets over the rose heads during the growing process and removing them before the roses are cut and sold. After Shaw sent Plaintiffs several cease-and-desist letters based upon their purported infringement of the '305 patent, Plaintiffs filed a lawsuit against Shaw seeking declaratory relief. Shaw counterclaimed for infringement.

When Mr. Shaw answered Plaintiffs' interrogatories on December 20, 2007 and February 25, 2008, he averred that he invented the process described and claimed in the '305 patent in August 1995. J.A. 201. He also explained that he first offered to sell a product using this process "in or around August/September 1995" to a flower shop in Chicago, Illinois. J.A. 197-98.

On March 13, 2008, Plaintiffs deposed Mr. Shaw. Mr. Shaw testified eighteen times that he invented the process described and claimed in the '305 patent in 1994. When Plaintiffs' counsel asked Mr. Shaw about the discrepancy between his interrogatories and deposition testimony, he responded "[t]hat [the interrogatory answer] was either a mistype or whatever. However, it was August of '94 and I wasn't sure if it was August or about early '94. I thought we had answered with early 1994...." J.A. 183. When then shown his interrogatory answer indicating August 1995 in Ecuador as the earliest date and location of the conception, Mr. Shaw explained "[i]t was a typo error and I didn't notice it. I read these documents over, too, and I didn't notice the error." Id. Mr. Shaw testified that he knew he developed the invention on May 11 through 14 of 1994 because he confirmed the timing with (1) David Sperber ("Sperber"), his personal assistant in Ecuador; (2) Govindarajan Muthiah ("Muthiah"), a graduate student at the University of Florida hired by Shaw as an employee; and (3) his passport, which he reviewed the night before the deposition and offered for evidentiary support. J.A. 175, 184, 784.

Mr. Shaw explained that Pedro Salzedo ("Salzedo"), a Shaw employee, figured out how to get the right size and quantity nets from the manufacturer. J.A. 178. Mr. Shaw testified that they "ironed out all the wrinkles" and started commercially ex porting roses grown with the patented process in September 1994 to Royal Floral Distributors, who then sold them to hundreds of customers. J.A. 178-80. While he was not sure of the exact date Muthiah started working for him, Mr. Shaw explained that it was approximately September 1994 and that he hired Muthiah after Shaw began commercial sales. J.A. 182. Mr. Shaw stated that he hired Muthiah "to do all the testing, experimental, whatever was necessary to bring [his] patent to market." J.A. 784. Mr. Shaw also discussed his experimentation with Salzedo, using garbage bags and rubber bands instead of netting, in 1995. J.A. 184-85. At the end of Mr. Shaw's deposition, Plaintiffs' counsel announced: "I'm adjourning. We're not done... we will reconvene." J.A. 875. They never did reconvene. Mr. Shaw's deposition transcript was available on March 27, 2008.

On May 6, 2008, Plaintiffs served Shaw with a motion for sanctions under Federal Rule of Civil Procedure ("FRCP") 11. Plaintiffs demanded that Shaw withdraw its allegations of infringement due to patent invalidity based upon the application of the on-sale bar pursuant to 35 U.S.C. § 102(b). Shaw responded with a declaration from Muthiah, stating that Mr. Shaw hired him in August 1995. Muthiah explained that he was responsible for "assisting Mr. Shaw in testing, refining and improving his newly discovered method of growing roses with nets on the rose bud." J.A. 518. Muthiah testified that he went to Ecuador in October and November 1995 to test and refine the process, and he completed the testing and prepared the drawings contained in the application for the patent-in-suit in December 1995. J.A. 518-19. Mr. Shaw also executed an errata sheet, on May 23, 2008, in an effort to alter his deposition testimony to say that the date of the invention and the commercialsales of the roses grown using the patented process was 1995, rather than 1994.

On June 11, 2008, Plaintiffs moved for summary judgment, arguing that the inventor's testimony about the date of the invention and sales of roses grown with the patented process demonstrates that the on-sale bar in 35 U.S.C. § 102(b) invalidates the patent-in-suit. On September 29, 2008, Mr. Shaw executed a declaration in opposition to Plaintiffs' motion, averring that "[t]he year that I conceived the patented method and began selling and importing roses grown utilizing the patented method was 1995, not 1994 as I stated during my deposition." J.A. 465. Mr. Shaw explained that he had confused 1994 with 1995 based upon a last-minute review of his passport, which included many stamps reflecting trips to Ecuador. J.A. 464.

After oral argument, the district court granted summary judgment, dismissing Shaw's counterclaim and invalidating the '305 patent. The district court explained that the only real dispute concerned the dates of conception and commercial sales. The district court dismissed Mr. Shaw's attempt to correct his allegedly mistaken deposition testimony as untimely under FRCP 30. The district court also excluded Mr. Shaw's errata sheet because (1) Mr. Shaw did not equivocate during his deposition and (2) Mr. Shaw "is a seasoned deponent; he stated in his deposition that he has been deposed 40 to 50 times." Del. Valley Floral Group, Inc. v. Shaw Rose Nets, LLC, No. 07-CV20199, 2008 WL 5588444, slip op. at 11-12 (S.D.Fla. Dec. 19, 2008) ("Summary Judgment Op"). Similarly, the court did not permit Mr. Shaw to use his declaration of September 29, 2008 ("2008 declaration") to create a genuine issue of material fact with respect to the dates of conception or commercial sales. The district court also concluded that Muthiah's statement that the invention was "newly discovered" in 1995 could not be used to create a genuine issue of material fact with regard to the date of conception because Muthiah lacked personal knowledge of events that occurred before he was hired. Further, the court found that the process was "ready for patenting" before the statutory critical date, which Shaw did not dispute.

After the district court granted summary judgment, Shaw filed a motion for reconsideration and presented what it termed "newly discovered evidence of the date of the invention and the dates of experimentation with the process after the statutory critical date." The district court denied this motion, finding that the two declarations were not newly discovered because the testimony was not unavailable prior to the grant of summary judgment.

Shaw timely appeals. We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(1).

DISCUSSION

Shaw raises several issues on appeal. First, it challenges the district court's grant of summary judgment, arguing that the district court erred in excluding evidence that demonstrates genuine issues of material fact with respect to (1) the date of invention and commercial sales as well as (2) whether the process was "ready for patenting." Second, Shaw challenges the district court's denial of its motion for reconsideration, urging us to consider the additional declarations it submitted. We address these issues in turn.

I. Standard of Review

We review a district court's grant of summary judgment de novo. Innogenetics, N.V. v. Abbott Labs., 512 F.3d 1363 1378 (Fed.Cir.2008). Summary judgment is only appropriate when there is "no genuine issue as to any material fact and...the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). All reasonable inferences are drawn in favor of the non-movant, and the evidence is viewed in the light most...

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