Cathodic Protection Service v. American Smelting & Refining Co.

• Decision Date: 07 May 1979
• Docket Number: No. 76-4134,76-4134
• Citation: 594 F.2d 499
• Parties: CATHODIC PROTECTION SERVICE, Plaintiff-Appellee, v. AMERICAN SMELTING & REFINING COMPANY, Federated Metals Corporation and Waynes Broyles Engineering Company, Defendants-Appellants.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 499

594 F.2d 499

203 U.S.P.Q. 102

CATHODIC PROTECTION SERVICE, Plaintiff-Appellee, v. AMERICAN SMELTING & REFINING COMPANY, Federated Metals Corporation and Waynes Broyles Engineering Company, Defendants-Appellants.

No. 76-4134.

United States Court of Appeals Fifth Circuit.

May 7, 1979.

Ned L. Conley, Elliott Cox, Houston, Tex., for defendants-appellants.

Michael P. Breston, Houston, Tex., for plaintiff-appellee.

Appeal from the United States District Court for the Southern District of Texas.

Before GEE and VANCE, Circuit Judges, and HUNTER, District Judge. ^*

VANCE, Circuit Judge:

I

Case Orientation

Cathodic Protection Service (Cathodic), filed this action on July 28, 1972, in the District Court for the Southern District of Texas alleging infringement of United States Letters Patent 3,616,422 (the original patent). The original patent, entitled "Galvanic Anode," was issued on October 26, 1971, on an application filed April 21, 1971. It covers a galvanic anode adapted for the cathodic protection of relatively large diameter pipelines submerged in water.

On September 26, 1973, Cathodic filed an amended complaint alleging infringement of United States Letters Patent Re 27,529 (the reissue patent) which is the patent involved in this suit. The latter patent, which is a reissue of the original patent, was issued on December 19, 1972, on an application filed August 7, 1972. Both the reissue patent and the original patent were issued to Cathodic as assignee of Gordon L. Doremus and Jack G. Davis.

In this suit Cathodic accuses Waynes Broyles Engineering Company (Broyles) of infringement and American Smelting & Refining Company (ASARCO) of contributory infringement and of actively inducing infringement by Broyles. ASARCO, ¹ a primary supplier of zinc, makes and sells zinc galvanic anodes. Broyles offers a complete cathodic protection service and distributes zinc galvanic anodes for ASARCO. Broyles and ASARCO counterclaimed seeking a declaration, (1) that the reissue patent is invalid, (2) that Cathodic competed unfairly with them by bringing this action, and (3) that Cathodic violated the antitrust laws by attempting to enforce the reissue patent.

Trial before the court commenced on January 16, 1975, and lasted until January 23. The court entered its original findings of fact and conclusions of law and judgment on February 12, 1976. ² On February 23, 1976, ASARCO and Broyles moved for new trial or in the alternative for amended findings of fact and conclusions of law. They specifically requested that the finding of treble damages be reserved until after an accounting. A memorandum and order was entered on August 3, 1976, denying defendants' post-trial motion. The court agreed, however, to hold the treble damage question until the time of the accounting.

On October 8, 1976, revised findings of fact and conclusions of law and a judgment were entered. The court ruled that the reissue patent was valid and infringed and entered judgment enjoining Broyles and ASARCO from further infringement. The counterclaim was dismissed in its entirety. ASARCO and Broyles appealed this ruling pursuant to 28 U.S.C. § 1292(a)(4).

II

Factual Orientation

The patent in issue covers a galvanic bracelet anode, which acts as a self-generating current battery when suitably mounted around underwater offshore pipelines. As described in its claim one, Cathodic's bracelet ³ consists of a pair of semicylindrical segments that are fitted around the pipe to form a full circle. Each segment has a cathodic core consisting of a pair of concentric steel bars that are entirely embedded within the anode body and adjacent to its inner periphery. The bars extend out the opposite longitudinal edges of the body where they are welded together to hold the bracelet on the pipe. Within the semicylindrical anodes, the cathodic cores are connected by angularly-spaced interlinking metal rods. ⁴

Galvanic anodes are used to protect objects made of other metals, or cathodes, from corrosion. When the anode and the object to be protected are connected and submerged in a medium that conducts electricity, a small electric current begins to flow from one object to the other. This electric current impedes the corrosion process and can extend the useful life of pipelines forty years or longer. Such pipelines are usually covered with a protective coating to prevent corrosion. Anodes are fastened to them as a precaution against a failure of the coating; then the pipelines are usually coated with concrete to keep them submerged.

Galvanic anodes of different shapes and sizes for land and marine use have been known for many years, and have been marketed by Cathodic, Broyles, and others since approximately 1958. Many prior patents on the cathodic protection art have been issued. ⁵ ASARCO has been a major supplier of zinc anode bodies for galvanic anodes since the anodes' conception.

Cathodic conceived its patented bracelet in 1968 and began manufacturing and marketing the bracelet early in 1969. Cathodic, Broyles and other people in the cathodic protection business, however, continued to market the old segmented designs.

Early in 1972 Broyles' customers began asking whether they could purchase anodes with a semicylindrical design. Broyles was aware of Cathodic's patent and conceived an alternate design, which, Broyles was satisfied, did not infringe Cathodic's patent. The customers accepted the alternate design, and Broyles began ordering zinc for the anode segments from ASARCO. ASARCO furnished Broyles anode segments, which Broyles assembled and sold to its customers.

When these anodes were being shipped, Cathodic had only the original United States patent No. 3,616,422, which had been issued on October 26, 1971. All of the claims of this original patent were limited in the scope of their coverage to anodes that included the following:

(a) a Continuous semi-cylindrical body of a galvanic anode metal, and

(b) a core, which is cathodic to the anode metal concentrically embedded entirely within the anode metal adjacent the inner periphery, in each segment is made up of

(1) at least two axially-spaced metal bars having

(2) Plurality of angularly-spaced metal rods interlinking the bars.

The anode designed and sold by Broyles used a quarter-circle segment of galvanic anode material, instead of a semicylindrical body, and its core did not include any angularly spaced metal rods.

Cathodic, however, learned of the Broyles transaction and promptly accused Broyles of infringing its patent. The concerned parties discussed the problem, but Cathodic continued to insist that the patent was infringed and eventually filed the original complaint in this suit.

Ten days after suit was filed, Cathodic filed an application to reissue the patent with claims that were much broader than the claims of the original patent ⁶ because they covered anodes (1) whether or not semicylindrical and (2) without the angularly spaced metal rods interlinking the bars of the core. ⁷

By this time ASARCO had examined the file wrapper ⁸ of Cathodic's original patent and discovered that Cathodic had failed to disclose to the Patent Office material prior art with which it was familiar. The prior art had also not been cited by the Patent Office. ASARCO promptly gave Cathodic notice not only of prior art, which was already known to Cathodic, but also of additional art, which had been found in searches made by ASARCO. This notice, which was made of record in this case pursuant to 35 U.S.C. § 282, was given for the purpose of allowing Cathodic the opportunity of disclosing the prior art to the Patent Office examiner while he was considering the reissue application.

Cathodic did not disclose any of the additional prior art to the examiner; thus the reissue patent issued without the examiner having been informed of the additional prior art. ⁹

The claims in Reissue Patent 27,529 are crucial to the ultimate issue and therefore are set out in full:

What we claim and desire to secure by Letters Patent is:

1. A galvanic anode for cathodic protection of pipe lines, comprising:

(a) a pair of semicylindrical segments adapted to embrace a pipeline, each segment comprising:

(1) a continuous, semicylindrical body of a galvanic anode metal;

(2) A metal core cathodic to the anode metal concentrically embedded entirely within the anode metal adjacent the inner periphery of said body;

(2) said core comprising:

(a) at least two axially-spaced, parallel metal bars;

(b) a plurality of angularly-spaced metal rods interlinking said bars; and

(c) each of said bars having end portions projecting from opposite, longitudinal edges of the anode body to form joint elements for connecting one of said segments to the other in pipe-embracing relation.

2. An anode according to claim 1 wherein said anode metal is a member selected from the group consisting of aluminum, zinc, magnesium, and alloys thereof.

3. An anode according to claim 1 wherein said core is constructed of mild steel.

4. An anode according to claim 1 including electric current conductor elements connected to said core for electrically connecting the core to the pipeline.

5. An anode according to claim 1 wherein one of said end portions is offset laterally to receive the non-offset end portion of an opposed bar to form the joint therebetween.

6. A galvanic anode for cathodic protection of pipelines comprising:

(a) a pair of semi-cylindrical segments adapted to embrace a pipeline, each segment comprising:

(1) a continuous, semicylindrical body of a galvanic anode metal;

(2) A metal core cathodic to the anode metal concentrically embedded entirely within the anode metal adjacent the inner periphery of said body;

(3) said core comprising:

(a) at least two axially-spaced, metal bars; and

(b) each of said bars having end portions projecting from opposite, longitudinal edges of the anode body to form joint elements for connecting one of said segments to the other in...