Diversitech Corp. v. Century Steps, Inc.

• Decision Date: 27 June 1988
• Docket Number: Nos. 87-1152,87-1165,s. 87-1152
• Citation: 7 USPQ2d 1315,850 F.2d 675
• Parties: DIVERSITECH CORPORATION, Plaintiff-Appellant, v. CENTURY STEPS, INC., Defendant-Cross Appellant. Appeal
• Court: U.S. Court of Appeals — Federal Circuit

Page 675

850 F.2d 675

7 U.S.P.Q.2d 1315

DIVERSITECH CORPORATION, Plaintiff-Appellant, v. CENTURY STEPS, INC., Defendant-Cross Appellant.

Appeal Nos. 87-1152, 87-1165.

United States Court of Appeals,

Federal Circuit.

June 27, 1988.

John A. Fogarty, Jr. of Kenyon & Kenyon, New York City, argued for plaintiff-appellant. With him on the brief were Hugh A. Chapin and Richard S. Gresalfi.

Dale Lischer of Jones, Askew & Lunsford, Atlanta, Ga., argued for defendant-cross appellant. With him on the brief were Julius R. Lunsford, Jr. and J. Rodgers Lunsford, III.

Before DAVIS ^*, NEWMAN, and ARCHER, Circuit Judges.

PAULINE NEWMAN, Circuit Judge.

Diversitech Corporation (Diversitech) and Century Steps, Inc. (Century) cross-appeal the final judgment of the United States District Court for the Middle District of Alabama, Northern Division ¹ relating to U.S. Patent No. 4,505,449 of Turner et al. (the '449 patent) for "Lightweight Concrete Cladded Heavy Equipment Base", issued on March 19, 1985 and assigned to Diversitech. The district court held all the patent claims invalid for obviousness; but if valid, infringed by Century's "first version" and not infringed by Century's "second version" of the accused device.

We reverse the judgment of invalidity of claims 1 through 3, and vacate the judgment of invalidity with respect to claims 4 through 7, which were not at issue. We affirm the judgments on the infringement issues, and remand for determination of damages and the charge of willfulness for infringement by Century's "first version".

Background

The claimed invention is a pad used as a base for heavy equipment such as air conditioners and transformers. It is constructed of a foam core and a fiberglass-reinforced cement coating on its top and sides, with the foam core exposed on the bottom. The advantages described for the claimed pad are its lighter weight due to the foam core and the absence of a cement layer on the bottom, ease in transportation as the pads may be stacked without the usual protective spacers, and ease of installation and use because the exposed foam bottom conforms to uneven surfaces, reducing the need for leveling of the surface. Diversitech sells the claimed pad as the "Cladlite Pad".

In 1983 Century began manufacture and sale of a heavy equipment pad with an exposed foam bottom (Century's "first version"), copying the Cladlite Pad. Following the issuance in 1985 of the '449 patent and notification of infringement by Diversitech, Century modified its pad by adding a thin layer of fiber reinforced concrete to the pad's bottom (Century's "second version"). Century stopped manufacturing the first version, although it continued to sell its inventory.

In the district court, Century admitted infringement by its first version, denied infringement by its second version, and counterclaimed for declaration of patent invalidity. The issues of damages and willful infringement were separated and have not been tried.

The district court held all claims of the '499 patent invalid for obviousness in terms of 35 U.S.C. Sec. 103, but not invalid for anticipation (Sec. 102) or failure to disclose the best mode (Sec. 112). The court stated that if the claims were deemed modified to include a "thin layer" of concrete on the bottom of the pad, such claims would be invalid under Sec. 112 for indefiniteness.

The court found that Century's second version does not literally infringe the claims, but that the second version would infringe if the claims were "read to include a thin layer on the bottom". This latter holding was apparently in response to Diversitech's assertion of infringement in terms of the doctrine of equivalents.

All aspects of the judgment, and all the issues, are raised on appeal and cross-appeal.

Claims 4-7

The '449 patent contains seven claims, of which only claims 1 through 3 were charged by Diversitech to have been infringed, and only these claims were discussed by the district court. Under these circumstances, the district court's judgment applies only to claims 1 through 3. Vandenberg v. Dairy Equipment Co., 740 F.2d 1560, 1568, 224 USPQ 195, 200 (Fed.Cir.1984) (declaring all patent claims invalid may have been an oversight, but it was nonetheless error). The judgment of invalidity with respect to claims 4 through 7 is vacated.

Anticipation--35 U.S.C. Sec. 102

Century appeals the district court's holding that claims 1 through 3 ² were not anticipated, asserting that the court erroneously focused on the disclosed invention instead of the claimed invention, and that the court failed to compare each element of the claims with the prior art in order to evaluate anticipation.

Anticipation is a question of fact, Shatterproof Glass Corp. v. Libbey Owens Ford Co., 758 F.2d 613, 619, 225 USPQ 634, 637 (Fed.Cir.), cert. dismissed, 474 U.S. 976, 106 S.Ct. 340, 88 L.Ed.2d 326 (1985), and is reviewed under the clearly erroneous standard, Ralston Purina Co. v. Far-Mar-Co., Inc., 772 F.2d 1570, 1574, 227 USPQ 177, 179 (Fed.Cir.1985). A patent challenger must show by clear and convincing evidence that a claim is anticipated. Tyler Refrigeration Corp. v. Kysor Industrial Corp., 777 F.2d 687, 690, 227 USPQ 845, 847 (Fed.Cir.1985). For a prior art reference to anticipate in terms of 35 U.S.C. Sec. 102, every element of the claimed invention must be identically shown in a single reference. See Hybritech Inc. v. Monoclonal Antibodies, Inc., 802 F.2d 1367, 1379, 231 USPQ 81, 90 (Fed.Cir.1986), cert. denied, --- U.S. ----, 107 S.Ct. 1606, 94 L.Ed.2d 792 (1987).

The district court correctly considered all elements of the claims including the preamble. In re Stencel, 828 F.2d 751 754-55, 4 USPQ2d 1071, 1073 (Fed.Cir.1987) states:

Whether a preamble of intended purpose constitutes a limitation to the claims is, as has long been established, a matter to be determined on the facts of each case in view of the claimed invention as a whole.

....

This purpose, set forth in the [preambles of the] claims themselves, "is more than a mere statement of purpose; and that language is essential to particularly point out the invention defined by the claims." In re Bulloch, 604 F.2d 1362, 1365, 203 USPQ 171, 174 (CCPA 1979).

See also Perkin-Elmer Corp. v. Computervision Corp., 732 F.2d 888, 896, 221 USPQ 669, 675 (Fed.Cir.), cert. denied, 469 U.S. 857, 105 S.Ct. 187, 83 L.Ed.2d 120 (1984) (the limitations appearing in the preamble are necessary to give meaning to the claim and properly define the invention).

In the '449 patent the preamble defines the invention as "a base for the support of equipment". The district court considered this essential limitation in determining whether any claim was anticipated, and concluded that no single reference contained all of the elements of any of claims 1 through 3 of the '449 patent. This finding has not been shown to be clearly erroneous, and is affirmed.

Obviousness--35 U.S.C. Sec. 103

The district court applied the criteria of Graham v. John Deere Co., 383 U.S. 1, 17-18, 86 S.Ct. 684, 693-94, 15 L.Ed.2d 545, 148 USPQ 459, 467 (1966) in holding the claims invalid for obviousness. The court referred to the presumption of validity, stating that "an alleged infringer must prove invalidity by clear and convincing evidence or its equivalent"; but in its holding of invalidity the court did not discuss how the presumption had been overcome. We conclude that, on the findings made by the district court, the presumption had not been overcome.

a. The Prior Art.

The district court analyzed the references in light of the claimed invention as follows:

[T]he two Piazza patents, the Merrill '508, and the Dixon '251 teach the use of foam cores that are fully encased on all surfaces, to promote lightness. While the Tkach '620 and the French patent each have partially exposed foam cores to promote lightness, a person of ordinary skill in the art would not interpret that exposure to promote ground conformance or enable shinning without protective spacers. The Unger '845 does not contain a foam core.

This analysis has not been shown to be clearly erroneous. The district court correctly found that the references do not show a load-bearing pad having a foam core with a cementitious coating on the top and sides only, to enable conformability to uneven ground surface or to allow stacking ("shinning") without spacers. However, the district court held that it would have been obvious to make such a product by combining the teachings of the references:

[A] combination of the teachings of the prior references would have suggested, at least by implication, the possibility of achieving further improvement by combining the teachings along the line of the Turner patent. The court is convinced that a person of ordinary skill in the art who is familiar with the references would have understood the prior art to teach that a heavy duty concrete pad may have a substantially exposed bottom and a foam core, and that these two features should be combined to give lightness, to allow a pad to conform to the ground, and to allow cushioning between pads when stacked and shipped. The Cladlite pad developed by Diversitech achieved nothing more than a combination which the prior art references would suggest to a person of ordinary skill in the art who is familiar with the references.

Diversitech argues that it not only produced a lightweight pad, but one with properties that were not suggested in the pertinent art. The problem confronted by the inventor must be considered in determining whether it would have been obvious to combine references in order to solve that problem. In re Wright, 848 F.2d 1216, 1219, (Fed.Cir.1988) ("whether a novel structure is or is not 'obvious' requires cognizance of the properties of that structure and the problem which it solves, viewed in light of the teachings of the prior art"); Lindemann Maschinenfabrik GmbH v. American Hoist & Derrick Co., 730 F.2d 1452, 1462, 221 USPQ 481, 488 (Fed.C...