J&M Indus., Inc. v. Raven Indus., Inc.
| Decision Date | 30 April 2020 |
| Docket Number | Case No. 16-2723-JWB |
| Citation | 457 F.Supp.3d 1022 |
| Parties | J&M INDUSTRIES, INC., Plaintiff/Counterclaim Defendant, v. RAVEN INDUSTRIES, INC., Defendant/Counterclaimant. |
| Court | U.S. District Court — District of Kansas |
Bryce Langford, David R. Barnard, Stinson, LLP, Kansas City, MO, Emily Lippold Gummer, Pro Hac Vice, Raymond G. Areaux, Pro Hac Vice, Carver Darden Koretzky Tessier Finn Blossman & Areaux, LLC, New Orleans, LA, Lynn D. Preheim, Stinson Leonard Street, LLP, Wichita, KS, for Plaintiff/Counterclaim Defendant.
David M. Stein, Pro Hac Vice, H. Josh Ji, Pro Hac Vice, Greenberg Gross, LLP, Costa Mesa, CA, Evan W. Woolley, Pro Hac Vice, Alston & Bird, LLP, Los Angeles, CA, Patrick D. Kuehl, Jr., Rimon Law, Kansas City, MO, for Defendant/Counterclaimant.
This matter is before the court on the following motions and briefs: Plaintiff's motion for summary judgment (Docs. 238, 239, 277, 295); Plaintiff's motion to exclude opinions of Dr. Carol Jones regarding non-infringement (Docs. 240, 241, 269, 287); Plaintiff's motion to exclude opinions of Dr. Carol Jones regarding invalidity (Docs. 242, 243, 272, 286); Plaintiff's motion to exclude opinions of Michael Lewis regarding damages (Docs. 244, 245, 270, 288); Plaintiff's motion to dismiss counterclaim (Docs. 246, 247, 275, 294); Defendant's motion to exclude opinions of Jeffrey Decker (Docs. 249, 250, 265, 290); Defendant's motion to exclude opinions of Antoinette Tease (Docs. 251, 252, 266, 289); and Defendant's motion for summary judgment (Docs. 253, 254, 292, 296). For the reasons stated herein, Plaintiff's motion to dismiss counterclaim (Doc. 246) and Defendant's motions to exclude opinions (Docs. 249, 252) are DENIED; the remaining motions are GRANTED IN PART and DENIED IN PART as stated in this order.
Plaintiff is a Louisiana corporation that designs and manufactures storage covers for the temporary storage of grains such as wheat and corn. Defendant is a South Dakota corporation whose business includes the sale of storage covers for temporary grain storage systems. (Doc. 1 at 2-3; Doc. 12.)
On May 24, 2016, the U.S. Patent and Trademark Office ("PTO") issued U.S. Patent No. 9,347,239 ("the ‘239 Patent"), which claimed a storage system for covering a pile of bulk material such as grain. The ‘239 Patent disclosed an invention for using tarpaulins with an internal strapping system. Plaintiff, the owner of the ‘239 Patent, filed this action on October 21, 2016, alleging that Defendant indirectly infringed the ‘239 Patent by making, offering, or selling Defendant's "Fortress Internal Strap System" to users who incorporated Defendant's product in their grain storage systems. (Doc. 1 at 2-3.)
The court held a Markman hearing on May 29, 2018, and subsequently construed several terms in the ‘239 Patent. (Doc. 147.) On August 17, 2018, Plaintiff amended the complaint to add a claim that Defendant contributorily infringed a related patent, U.S. Patent No. 9,890,550 ("the ‘550 Patent"), owned by Plaintiff and issued by the PTO on February 13, 2018. (Doc. 156 at 5.) Like the ‘239 Patent, the ‘550 Patent claimed a storage system for covering a pile of bulk material. At the time of the amendment, Plaintiff effectively conceded that under the court's construction of the ‘239 Patent claim terms, Plaintiff could not prevail on its claim for infringement of the ‘239 Patent. (See Docs. 153, 154.) The ‘550 Patent relies on the same figures and description as the ‘239 Patent. The only difference between the two is that the claims in the ‘550 Patent are broader than the claims in the ‘239 Patent. (See Doc. 239 at 1.) The ‘550 Patent is a continuation patent; it claims a priority date based on the ‘239 Patent and a provisional application filed February 3, 2012.1 (Id. )
As set forth in the Pretrial Order, Plaintiff's only remaining claim is that Defendant contributorily infringed claims 8, 9, and 11 of the ‘550 Patent. (Doc. 237 at 10.) Plaintiff seeks damages and injunctive relief, and further contends the case is exceptional and the infringement is willful such that Plaintiff is entitled to increased damages and attorney fees and costs. (Id. at 11.) Defendant denies the claim and asserts affirmative defenses. Defendant also asserts a counterclaim for inequitable conduct, which alleges that Plaintiff obtained the ‘239 Patent by withholding material information about the prior art from the PTO during the prosecution of that patent, and that this conduct renders invalid or unenforceable the ‘239 Patent and "its entire family," including the ‘550 Patent. (Id. at 16.)
Claims 8, 9, and 11 of the ‘550 Patent, all of which are dependent on Claim 1, claim an invention comprising the following:
The PTO issued the ‘239 Patent to Plaintiff on May 24, 2016. On October 21, 2016, Plaintiff brought the instant suit against Defendant for indirect infringement of the ‘239 Patent. On February 13, 2018, the PTO issued the ‘550 Patent to Plaintiff. The ‘550 Patent claims priority to the ‘239 Patent and Provisional App. No. 61/594,727 filed on February 3, 2012. (Doc. 239 at 1.) The claims of the ‘239 and ‘550 Patents are directed to an internal strapping system for covering a pile of bulk material. The claims are not limited to the tarp portion of the system but include other components as well. The ‘550 Patent relies upon the same figures and description as the ‘239 Patent. The only difference is the scope of the claims. (Id. )
On August 17, 2018, Plaintiff filed its first amended complaint adding the ‘550 Patent to the instant litigation. Plaintiff dismissed with prejudice its infringement claims as to the ‘239 Patent, leaving the ‘550 Patent as the only patent still at issue. Plaintiff alleges infringement of Claims 8, 9, and 11 in this litigation. (Id. at 1-2.)
On August 18, 2017, Plaintiff filed an Information Disclosure Statement ("IDS") with the PTO that contained Defendant's invalidity contentions. Defendant's initial invalidity contentions included the "Union Iron System," the "Western Ag hay tarps," and the "Quadrant System" (identified as the "Raven Covers"). (Id. at 2.) Plaintiff also submitted the Bates numbered documents identified by Defendant with its invalidity contentions. The documents identified as "RavenJMI0000522-580" submitted to the PTO reflected "Western Ag Hay Tarps," although Defendant contends it learned during a deposition on January 30, 2019, that these documents were not actually Western Ag drawings. (Doc. 239 at 2; Doc. 277 at 5.) The initial invalidity contentions and related documents were considered by the Patent Examiner in the ‘550 Patent prosecution. (Id. at 3.) Defendant cites evidence that the Patent Examiner considered the invalidity contentions and materials after Plaintiff and the Examiner had reached an agreement concerning - according to Defendant - the patentability of the claims in the ‘550 Patent. (Doc. 277 at 5-6.) Plaintiff contends the agreement concerned only one rejection, not the patentability of the claims generally. (Doc. 295 at 2-3.) Among other things, Plaintiff argues the Examiner would have issued a notice of allowance (NOA) had there been agreement on patentability. (Id. at 3.) The court concludes there is a genuine issue of fact as to the scope of agreement between the Examiner and Plaintiff. After the ‘550 Patent was added to the instant suit, Defendant served amended invalidity contentions that address the ‘550 Patent.
Defendant's expert, Dr. Jones, opined that the ‘550 Patent is invalid due to the "on-sale bar" of 35 U.S.C. § 102. A patent is invalid under the on-sale bar if, more than one year before the application filing date, the invention was the subject of a commercial sale or offer for sale and was ready for patenting. GS Cleantech Corp. v. Adkins Energy LLC , 951 F.3d 1310, 1324 (Fed. Cir. 2020) (citing Pfaff v. Wells Elecs., Inc. , 525 U.S. 55, 67, 119 S.Ct. 304, 142 L.Ed.2d 261 (1998) ). Among other things, Dr. Jones said it was "possible" Plaintiff offered its internal strapping system for sale to Archer Daniels Midland ("ADM") prior to February 1, 2012, and she cited an "indication" that a verbal offer for sale occurred in a conversation between James Ramsey of ADM and Aaron Gummer of Plaintiff sometime between October 2011 and February 2012. (Doc. 239 at 3.) Defendant cites evidence that Ramsey and Gummer had a conversation in which Gummer discussed Plaintiff's new internal strapping system. (Doc. 277-24 at 5-6.) Gummer said he wanted to meet with Ramsey about it. He explained they would ratchet down the internal strap in the tarp to the walls. (Id. at 6.) Ramsey's recollection of when this occurred was hazy, but thinks it may have been around December 6, 2011. (Id. at 5.) On December 6, 2011,...
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