Rosemount, Inc. v. Beckman Instruments, Inc.
| Decision Date | 16 February 1984 |
| Docket Number | Nos. 83-947,83-1238 and 83-1251,s. 83-947 |
| Citation | 727 F.2d 1540,221 USPQ 1 |
| Parties | ROSEMOUNT, INC., Appellee/Cross-Appellant, v. BECKMAN INSTRUMENTS, INC., Appellant/Cross-Appellee. Appeal |
| Court | U.S. Court of Appeals — Federal Circuit |
Sheldon Karon, Chicago, Ill., argued for appellant/cross-appellee. With him on the brief were Victor G. Savikas, Richard L. Horn, George Vernon, Thomas D. Rosenvein, Chicago, Ill., Robert J. Steinmeyer and Paul R. Harder, Fullerton, Cal.
John F. Flannery, Chicago, Ill., argued for appellee/cross-appellant.
Before MARKEY, Chief Judge, COWEN, Senior Circuit Judge, and BENNETT, Circuit Judge.
Appeals from a judgment of the District Court, Central District of California, that Rosemount's patent No. 3,440,525 ('525 patent) is valid and infringed by Beckman (No. 83-947), and from a judgment of that court that Beckman's post-trial infringement violated its injunction, but denying damages to Rosemount for that infringement (Nos. 83-1238, 83-1251). We affirm.
In 1965, when Charles Cardeiro made the inventions claimed in the '525 patent, Beckman was the leading manufacturer of pH meters, with 40% of the process pH market. Beckman had a continuous development program designed to maintain and preferably increase its market share. Universal Interlock, Inc. (Uniloc), Rosemount's predecessor in interest, began marketing the pH meter of the '525 patent shortly after Cardeiro invented it. By 1975, Uniloc's annual sales of the patented inventions had grown from zero to many millions of dollars, and Uniloc employees had increased from its 5 founders to 170. Uniloc sold $25,000,000 worth of the patented inventions.
Beginning in 1966, within a year of Uniloc's first sales, Beckman's engineers and salesmen were sending a stream of reports to Beckman about the superiority of Uniloc's pH meters over Beckman's and those of other manufacturers, about customer preference for the patented pH meters, and Having lost sales of the Model "J" it was selling when Cardeiro made his invention, Beckman unsuccessfully attempted to design and market improved pH meters. After studying designs it found in the prior art, Beckman developed a pH meter embodying Cardeiro's concept in 1968. It modified that design upon issuance of the '525 patent in 1969. By 1973, Beckman found its market share had dropped to 27%, due principally to the advent of the patented pH meter, which had captured 25% of the market and was selling at 10% less than Beckman's pH meter. At that point, after evaluating the pH meters of six manufacturers, including its own and Uniloc's, Beckman elected to make and sell the pH meters found to have infringed claims of the '525 patent.
about sales lost to Uniloc. The reports and Beckman's internal memos praised the patented pH meters as offering "unique and advantageous features", as preferred by users because of no "downtime" and "complete lack of maintenance", and as "low in price". 1
Rosemount sued Beckman on May 4, 1978. Beckman denied infringement and asserted that the '525 patent was invalid under 35 U.S.C. Secs. 102(a), 102(b), 102(e), 102(f), 102(g), 103, and 112. Beckman also asserted invalidity for incorrect naming of an inventor and unenforceability for fraud on the Patent and Trademark Office (PTO) and for unclean hands because Rosemount prosecuted the suit when the art cited by Beckman was not cited in the PTO, because Rosemount's licensing practices were wrongful, and because an element of the invention was not invented by Cardeiro. Beckman counterclaimed for a declaratory judgment that the patent is invalid and not infringed.
An eight-day trial was conducted (October 20-28, 1981). Judge Waters filed a succinct but comprehensive Memorandum of Decision on February 2, 1983, (reported at 569 F.Supp. 934), entered 137 findings of fact and 10 conclusions of law, and signed a judgment on February 24, 1983. In those documents, the court held the '525 patent valid, found that Beckman's Models 940/A, 941/A, 940B, 940BF, 960A, 980, and 8700 pH meters (Models 940/A-941/A) infringed asserted claims 1-3, 8, and 12, found Beckman's infringement to have been willful, awarded Rosemount treble damages and its attorney fees, and enjoined infringement. An accounting was stayed pending appeal.
On May 13, 1983, Rosemount charged Beckman with violation of the injunction by making and selling another infringing pH meter (Model 960B). The court found infringement and held Beckman in contempt, but declined to award Rosemount damages for that infringement because Rosemount knew of Beckman's sales of the Model 960B throughout the trial and did not include it with the accused Models 940/A-941/A.
The invention found to have been appropriated is set forth in claims 1-3, 8, and 12:
Claim 1
A system for determining the pH of a variable solution comprising:
a pH sensitive electrode, including a high impedance material responsive to the hydrogen ion activity of the variable solution and an internal electrical conductor for generating a voltage at said internal conductor indicative of the pH of the variable solution; and
a DC amplifier circuit for developing a signal as a function of the voltage developed on said internal conductor, said circuit including a preamplifier stage having a field effect transistor mounted with said electrode and in close proximity to said high impedance material and with its gate terminal connected to said internal conductor to provide a low impedance signal output from its output terminals for transmission to a remote circuit responsive to said low impedance signal output for indicating the pH of the variable solution.
The system of claim 1 wherein said field effect transistor is disposed in a heat exchange relationship with said high impedance material that subjects both said field effect transistor and said high impedance material to substantially the same temperature variations.
The system of claim 2 further comprising:
a probe structure engaging said pH sensitive electrode, said field effect transistor being disposed within said probe structure adjacent the pH sensitive electrode, and one end of said internal conductor being connected directly to the gate terminal of said field effect transistor.
The system of claim 1 wherein:
said field effect transistor is operated with its drain-to-source bias current at the level where the gain characteristic is independent of temperature variation over an ambient temperature range.
In a system for measuring the pH of a circulating solution, an arrangement comprising:
a pH sensitive electrode including a material responsive to the hydrogen ion activity of the circulating solution for developing a voltage indicative thereof, a hollow insulating member mounting said material for immersion in said circulating solution, an internal conductor, and a salt bridge solution contained within the hollow insulating member for establishing electrolytic contact between said material and said internal conductor; and
an amplifier circuit responsive to the voltage on said internal conductor, said amplifier circuit having a field effect transistor attached to and in close proximity with the insulating member and having its gate electrode connected to said internal conductor and its source and drain terminals connected to provide a low impedance signal indicative of the pH of the circulating solution for transmission to a remote location.
Whether the district court erred in: (1) holding the '525 patent valid; 2 (2) finding claims 1-3, 8, and 12 infringed; (3) finding willful infringement and awarding treble damages and attorney fees; (4) holding Beckman in contempt; (5) excluding testimony; (6) declining to award damages for infringement by the Model 960B pH meter.
OPINIONBeckman misconceives the role of an appellate court and the nature of the appellate process. The court does not sit to consider evidence de novo, and the appellate process is not a mere academic exercise. Yet Beckman asks us to say the invention "is" 3 obvious after considering anew and only the claims and the prior art. Its briefs ignore all facts in the record that objectively establish the circumstances and human events surrounding the birth of the invention and its effect on the industry, as well as many of the fact findings militating against its positions on the issues. The district court's Memorandum Decision is nowhere mentioned in the 78 pages of Beckman's briefs.
Appeals in patent cases should not be mere games played with pieces of paper called references and the patent in suit. Lawsuits arise out of the affairs of people, real people facing real problems. So here, the technical problem out of which grew the present litigation was real. It was solved by inventor Cardeiro.
When Cardeiro's company began selling his problem-solving product, Beckman was confronted with a serious competitive business problem. Beckman first tried to solve that business problem with its own new designs, and when those failed, by appropriating Cardeiro's invention.
None of this real-world history is explicated in Beckman's briefs. An appellant cannot, within the page limitations for briefs, be expected to grapple with each of 137 fact findings. The foregoing history, however, is made clear in these ignored-by-Beckman findings of the district court: 4
(1) Before Cardeiro's invention, repackaged laboratory pH meters were used in liquid streams of the process industry.
(2) The pH meters of (1) had a serious problem of drifting out of calibration. The leading pH meter in the field, Beckman's Model "J", had to be recalibrated as often as every eight hours.
(3) Beckman and others made numerous unsuccessful attempts to fill the longfelt need for a solution to the drifting problem.
(4) Scaling and corrosion had been a problem in watercooling towers since those towers began operating. No one had...
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