Beckman Instruments, Inc. v. LKB Produkter AB

Decision Date13 December 1989
Docket NumberNos. 88-1582,88-1583,s. 88-1582
PartiesBECKMAN INSTRUMENTS, INC., Plaintiff/Cross-Appellant, v. LKB PRODUKTER AB, Wallac Oy, Pharmacia LKB Nuclear Microtomy, Inc. and Pharmacia LKB Biotechnology, Inc., Defendants-Appellants.
CourtU.S. Court of Appeals — Federal Circuit

Donald R. Dunner, of Finnegan, Henderson, Farabow, Garrett & Dunner, Washington, D.C., argued for plaintiff/cross-appellant. With him on the brief were Roger D. Taylor and Darrel C. Karl, of Finnegan, Henderson, Farabow, Garrett & Dunner.

Robert H. Stier, Jr., of Bernstein, Shur, Sawyer & Nelson, Portland, Me., argued for defendants-appellants. Of counsel were Philip L. Cohan, of Piper & Marbury, Washington, D.C., and Charles L. Gholz, of Oblon, Fisher, Spivak, McClelland & Maier, Arlington, Va.

Before RICH, Circuit Judge, MILLER, Senior Circuit Judge, and ARCHER, Circuit Judge.

RICH, Circuit Judge.

Defendants LKB Produkter AB, Wallac Oy, Pharmacia LKB Nuclear Microtomy, Inc., and Pharmacia LKB Biotechnology, Inc. (collectively LKB) appeal from the judgment of the United States District Court for the District of Maryland entered upon a jury verdict that LKB infringed claims 2 and 4 of U.S. Patent No. 4,029,401 ('401). LKB also appeals from the district court's decision, reported in Beckman Instruments, Inc. v. LKB Produkter AB, 703 F.Supp. 408, 8 USPQ2d 1605 (D.Md.1988), to deny LKB's motion for a new trial and to impose plaintiff's attorney fees and expenses on LKB under 35 U.S.C. § 285. Plaintiff Beckman Instruments, Inc. (Beckman) cross-appeals based upon the district court's decision not to include Beckman's fees and expenses for expert witnesses and consultants in its calculation of attorney fees. We affirm-in-part, vacate-in-part, and remand.

BACKGROUND

Patent '401 to Nather is for methods and apparatus for improving the accuracy of counting techniques in liquid scintillation counters (LSC's). LSC's are used in biological and pharmacological research to measure the amount of a radioactive tracer isotope present in a liquid biological sample. They detect light flashes or scintillations caused by radioactive emissions within the sample and convert those light flashes into electronic pulses. The electronic pulses are then sorted according to their amplitude and frequency, and displayed in a characteristic distribution curve or spectrum for the isotope being measured. The amount of the isotope present can then be calculated.

Researchers have long known that LSC's suffer from a phenomenon known as "quench". Quench is an interference with an LSC's ability to detect the full number and intensity of the scintillations in a given sample due to the sample's chemical or color content. In the mid-1960's, several groups of researchers filed patent applications on methods and apparatus which would compensate for the effect of quench. One of these applications belonged to Nather, which, after an extended prosecution including an interference proceeding, issued as the '401 patent on June 14, 1977.

LKB is in the business of making LSC's, which it sells in the United States and elsewhere. One such LSC manufactured by LKB includes an "auto window" chip within its computer hardware. This auto window chip performs the function of automatically compensating for quench in the sample.

Beckman filed its complaint on July 23, 1985, alleging that the LKB models which contain the auto window feature infringe claims 3-7 of the '401 patent. Several defenses were raised, including invalidity of the patent, inequitable conduct, and lack of personal jurisdiction over co-defendant LKB Produkter. In addition, LKB filed an antitrust counterclaim. The personal jurisdiction defense and the antitrust counterclaim were eventually dropped by LKB. The inequitable conduct defense was severed for a separate bench trial following a jury trial of the validity and infringement issues.

The jury found the three apparatus claims in issue (3, 5 and 6) invalid and not infringed and found the two method claims (4 and 7) "valid" [sic, not proved invalid] and infringed. The jury also found that the infringement was not willful and awarded damages of $1,028,000. Upon hearing further testimony concerning the inequitable conduct issue, the court found no basis for a holding of inequitable conduct, and so entered judgment for Beckman on the jury's verdict. Beckman Instruments, Inc. v. LKB Produkter AB, 5 USPQ2d 1462 (D.Md.1987).

The judge also entered a permanent injunction prohibiting LKB from future infringement of the '401 patent. The exact wording of a portion of the injunction is as follows:

Defendants are further ordered, within 30 days of the effective date of this order, to deliver to counsel for plaintiffs for destruction all [auto window chips] ... which are in the defendants' possession, custody, or control within the United States....

Counsel for LKB apparently concluded that the above language gave LKB the option to ship the auto window chips out of the United States within the 30-day period instead of surrendering them for destruction. Therefore, a great many of the auto window chips in the U.S. at the date of the injunctive order were shipped to LKB's business in Finland. Ten demonstrator LSC's which included the auto window feature were allowed to remain in the United States. The district court found these activities to be a deliberate and repeated violation of the injunction. Beckman, 703 F.Supp. at 410, 8 USPQ2d at 1608.

Finally, the district court found the case to be "exceptional", and so awarded attorney fees and litigation expenses to Beckman under 35 U.S.C. § 285. In holding the case exceptional, the court relied on both the alleged violations of the injunction and LKB's vexatious litigation strategy. 703 F.Supp. at 410, 8 USPQ2d at 1607. The

district court awarded all of Beckman's attorney fees and expenses (totalling $1,969,664.44) except for those relating to the fees and expenses of expert witnesses and consultants (totalling $409,406.10), which the court was not certain were awardable under 35 U.S.C. § 285.

OPINION
I. The Jury Verdict

LKB maintains that the jury verdict should be vacated because apparatus claims 3, 5 and 6, which were found both invalid and non-infringed, are so similar to method claims 4 and 7, which were found both valid and infringed, that the jury's verdict is inherently inconsistent. As we stated in Allen Organ Co. v. Kimball International Inc., 839 F.2d 1556, 1563, 5 USPQ2d 1769, 1774 (Fed.Cir.), cert. denied, --- U.S. ----, 109 S.Ct. 132, 102 L.Ed.2d 104 (1988), the issue of inconsistent jury findings is a procedural matter not unique to patent law, and as such, we apply the discernable law of the forum.

Under the law of the Fourth Circuit, when the jury's findings apparently conflict, "the court has a duty to harmonize the answers, if it is possible to do so under a fair reading of them." Ladnier v. Murray, 769 F.2d 195, 198 (4th Cir.1985) (citations omitted). On LKB's motion for a new trial, the district court found no conflict in the jury's findings and held that: (1) LKB had waived any objection concerning the findings on validity by failing to object to the jury instruction that "each claim of a patent ... is presumed valid independently of the validity of any other claims of the patent"; and (2) since the analysis for determining infringement is different for method claims than for apparatus claims, the jury's verdict is not so inconsistent as to be irrational. Beckman, 703 F.Supp. at 412-13, 8 USPQ2d at 1606. Upon review of the record before us, we are not convinced that the district court made an error of law in reconciling the jury's findings, and so affirm the denial of a new trial.

II. The Allegedly Erroneous Jury Instruction

LKB also appeals the denial of a new trial based on an allegedly erroneous jury instruction concerning the availability of non-enabling references as prior art. The particular language which LKB considers erroneous is as follows:

For the Jordan patent to anticipate claims 5 and 7 of the '401 patent, it must expressly or inherently teach the entire claim.

A prior art reference must be enabling before it can invalidate the '401 patent. That is, it must provide a description sufficient to teach a person of ordinary skill in the art how to make and use the apparatus or process. However, it is not necessary that the prior art have been actually made in order to satisfy the enablement requirement.

....

References relied upon to support a rejection for obviousness must provide an enabling disclosure. That is to say, they must place the claimed invention in the possession of the public.

LKB's objection lies not so much with the instructions itself, but with the combination of the instruction and certain expert testimony by Beckman's expert witness. Specifically, one of the issues argued at trial was whether or not the device disclosed in the Jordan patent was operable to achieve its stated goal. After presenting expert testimony that it was not, Beckman's patent expert testified as follows:

Q. Now, assuming that their testimony on whether or not Jordan worked is credible, what impact does that have on whether Jordan can be relied on to invalidate the Nather patent?

A. Well, a piece of prior art that doesn't work is not prior art.

Q. What does that mean in terms of whether it can be relied on to invalidate the patent?

A. It means it can't be relied on.

Q. Why is that the basic rule or principle--

A. It doesn't teach anything useful or helpful, the technology is useless. It doesn't operate and therefore doesn't contribute anything and therefore can't be prior art to somebody else.

LKB contends that the combination of the jury instruction and the above testimony would improperly lead the jury to believe that if the Jordan device was not operable, it could be disregarded as prior art.

First, the above testimony of Beckman's expert witness...

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