Am. Hoist & Derrick Co. v. Manitowoc Co., Inc.

• Citation: 448 F. Supp. 1372
• Decision Date: 27 February 1978
• Docket Number: No. 72-C-474.,72-C-474.
• Parties: AMERICAN HOIST & DERRICK COMPANY and T. S. DeCuir, Plaintiffs, v. The MANITOWOC COMPANY, INC., Defendant.
• Court: U.S. District Court — Eastern District of Wisconsin

448 F. Supp. 1372

AMERICAN HOIST & DERRICK COMPANY and T. S. DeCuir, Plaintiffs, v. The MANITOWOC COMPANY, INC., Defendant.

No. 72-C-474.

United States District Court, E. D. Wisconsin.

February 27, 1978.

Andrus, Sceales, Starke & Sawall by Glenn O. Starke, Milwaukee Wis., for plaintiffs; William A. Braddock, Robert W. Gutenkauf, Burd, Braddock & Bartz, Minneapolis, Minn., of counsel.

Leydig, Voit, Osann, Mayer & Holt by Philip H. Mayer, Chicago, Ill., for defendant; Davis, Kuelthau, Vergeront, Stover & Leichtfuss by Walter S. Davis, Milwaukee, Wis., of counsel.

DECISION and ORDER

MYRON L. GORDON, District Judge.

I. INTRODUCTION

This is an action for patent infringement under 35 U.S.C. § 271 et seq. by American Hoist & Derrick Company (American Hoist) and T. S. DeCuir against the Manitowoc Company, Inc. (Manitowoc). The case was tried to the court, and the parties have filed briefs on the merits and proposed findings of fact and conclusions of law pursuant to Rule 52(a), Federal Rules of Civil Procedure.

The plaintiff and defendant are competitors in the manufacture and sale of cranes adapted for lifting heavy loads beyond the capability of conventional cranes of comparable size. American Hoist's heavy lift crane is made and sold under the tradename "Sky Horse"; the defendant's heavy lift crane is made and sold under the tradename "Ringer." The Ringer crane has been made and sold in several models: 4000 Series I, 4100 Series II, 4100 Series III, 4600 Series I, 4600 Series II, and 4600 Series III.

The Sky Horse crane is the commercial adaptation of United States patent no. 3,842,984 (the Sky Horse patent). The Sky Horse patent was issued on October 22, 1974, to American Hoist as the assignee of Archer W. Brown and James L. Montgomery. The Sky Horse patent is an improvement of the counterbalancing crane taught by claims 12 through 14 of United States patent no. 3,202,299 (the DeCuir patent). The DeCuir patent was issued on August 24, 1965, to T. S. DeCuir, as the assignee of Mitchell DeCuir. The Ringer cranes are the commercial adaptation of United States patent no. 3,485,383 (the Ringer patent). The Ringer patent was issued on December 23, 1969, to Manitowoc as the assignee of Daniel E. Beduhn.

The plaintiffs claim that the defendant's manufacture and sale of the Ringer crane models 4100 Series II, 4100 Series III, 4600 Series II, and 4600 Series III infringe claims 12, 13 and 14 of the DeCuir patent and claims 1 and 2 of the Sky Horse patent. Ringer crane models 4000 Series I and 4600 Series I are not accused of infringement. The defendant has counterclaimed, alleging that American Hoist's manufacture and sale of the Sky Horse crane infringe claim 1 of the Ringer patent. For the reasons set forth below, I have determined that the DeCuir patent is not infringed by the defendant's Ringer cranes and that the Ringer patent is not infringed by the plaintiff American Hoist's cranes.

The DeCuir counterbalancing crane was conceived by Mitchell DeCuir, T. S. DeCuir's son, in 1959. The patent application was filed on July 22, 1963, was assigned to T. S. DeCuir in February, 1964, and the patent was issued on August 24, 1965. The patent covered a "three-in-one" crane: a machine which could be used as a standard lift crane, a guy derrick (i. e. a tall mast anchored to the ground with guy cables), and a counterbalancing crane. T. S. DeCuir contacted the plaintiff with a view toward marketing the invention but was turned down initially. After an unsuccessful attempt to get a second company interested in the invention, T. S. DeCuir dealt with the defendant. On April 25, 1964, T. S. DeCuir entered into an option agreement with the defendant concerning two patent applications, one being the DeCuir patent in suit. Under the terms of this agreement, T. S. DeCuir granted the defendant an option to obtain an exclusive license under the patent applications and any patents that might issue from them. Pursuant to this agreement, T. S. DeCuir disclosed the construction of the DeCuir counterbalancing crane configuration to the defendant and submitted drawings and other data, and a model of the counterbalancing crane. T. S. DeCuir had also submitted a copy of the pending patent application to the defendant. In accordance with the terms of the option agreement, the defendant at its own expense filed patent applications in six foreign countries based on the United States patent application.

As drafted, the option agreement included a confidential disclosure provision which required the defendant to hold in confidence all of the materials disclosed by T. S. DeCuir. At the defendant's request, this provision was deleted at the time the agreement was executed.

On July 20, 1964, the defendant notified T. S. DeCuir of its termination of the option agreement. T. S. DeCuir argues that the option agreement was cancelled after the deletion of the nondisclosure provision because no obstacle remained which prevented the defendant's manufacture and sale of a crane in the DeCuir counterbalancing configuration. The plaintiffs assert that during the period of the option agreement, the patent application did not specifically cover the counterbalancing crane configuration. However, the plaintiffs point to no evidence which substantiates this assertion, and my review of the testimony reveals none. Also, it appears from the file wrapper of the DeCuir patent that the counterbalancing crane configuration may not have been specifically claimed until a supplemental amendment to the application was filed on February 2, 1965.

The defendant argues that the reason for the deletion of the nondisclosure provision was not that suggested by the plaintiff, but rather was because T. S. DeCuir's disclosures were not submitted on a confidential basis. The defendant claims that the option agreement was cancelled because of engineering problems with the DeCuir guy derrick concept and because of doubts it had with respect to the inventorship of the DeCuir crane. In any case, it is clear that by the time the option agreement was terminated, and well before the Ringer cranes were designed, the defendant was familiar with the DeCuir crane concept through its examination of the patent application, the crane model, and the drawings disclosed by T. S. DeCuir.

The first Ringer crane model was the 4000. It was conceived in late 1965 and 1966, and the first prototype was tested on March 19, 1967. The Ringer model 4600 Series I was developed shortly after the 4000 model. The Ringer patent application was filed on February 9, 1968.

The Sky Horse crane was conceived in late 1967 and the patent application was first filed in October, 1968. According to a memorandum drafted by Archer Brown, one of the Sky Horse inventors, Mr. Brown and James L. Montgomery developed the Sky Horse crane in response to the Ringer cranes, which were exceeding the load handling capacities of American Hoist's cranes. The defendant's counterclaim alleges that the Sky Horse crane infringes the Ringer patent.

The accused Ringer crane models 4100 Series II and III, and 4600 Series II and III were developed subsequent to the appearance of the Sky Horse crane on the market. The plaintiffs claim that these later Ringer models adapted certain features of the Sky Horse crane, discussed in detail below, in such a manner as to infringe the Sky Horse patent.

The Sky Horse patent application was refiled in 1970 and was refiled a second time in December, 1972, after this action was commenced. When the patent issued on October 22, 1974, the plaintiffs filed a supplemental complaint alleging infringement of the Sky Horse patent in addition to the DeCuir patent.

II. CONVENTIONAL CRANES

The machines involved in this action are heavy lift cranes. A brief comment about the prior art conventional lift crane will facilitate the description of the patents and machines in suit.

Conventional lift cranes generally include the following: a lower works, normally with crawlers or wheels making the crane mobile; an upper works or deck carrying the crane driving and operating machinery; a load handling boom pivoted on the front of the deck for up-and-down angular movement; a counterweight mounted on the rear of the deck; and rigging interconnecting the boom and the counterweight so that a load on the end of the boom is balanced by the counterweight without tipping the crane over. It is also conventional to vary the angle at which the rigging engages the boom by anchoring the rigging at the upper end of a structure carried on the deck.

The parties have engaged in a semantic dispute over the proper term for this structure: The plaintiffs assert that it may properly be called an A-frame or gantry. The defendant urges that it may also properly be referred to as a "mast." The significance of that dispute is that the DeCuir patent describes a mast which is used in addition to the standard structure, whether it be termed mast, gantry or A-frame. The defendant seeks to establish that this additional mast is not unique.

Although I am convinced from the testimony that the terms may be used interchangeably, I also believe that the additional mast structure on the DeCuir crane is indeed unique and a part of the invention as explained more fully below. For the sake of convenience, however, the term "mast" will be used in this decision to refer only to the longer mast of the plaintiffs' and defendant's cranes. The lower structure to which the rigging is anchored will be referred to as the A-frame or gantry.

Ordinarily, cranes embody machinery for controlling a variety of movements. The deck can revolve (i. e. swing) on the lower works, the boom can be pivoted up and down (i. e., raised or lowered), the lower works can move (i. e., transport) the entire crane, and the mast or gantry can be swung vertically (i. e., raised or lowered). It is also conventional to make cranes of various sizes, to equip a given crane with booms of...