Central Sprinkler Co. v. Grinnell Corp.

• Decision Date: 08 September 1995
• Docket Number: 94-CV-7483.,Civ. A. No. 94-CV-7482
• Citation: 897 F. Supp. 225
• Parties: CENTRAL SPRINKLER COMPANY v. GRINNELL CORPORATION. CENTRAL SPRINKLER COMPANY v. The VIKING CORPORATION and Supply Network, Inc.
• Court: U.S. District Court — Eastern District of Pennsylvania

897 F. Supp. 225

CENTRAL SPRINKLER COMPANY v. GRINNELL CORPORATION.

CENTRAL SPRINKLER COMPANY v. The VIKING CORPORATION and Supply Network, Inc.

Civ. A. Nos. 94-CV-7482, 94-CV-7483.

United States District Court, E.D. Pennsylvania.

September 8, 1995.

Eric Kraeutler, Michelle T. MacDonald, Morgan, Lewis & Bockius, Philadelphia, PA, for plaintiff.

Peter J. Deeb, Frey, Petrakis & Deeb, Philadelphia, PA, Robert E. Rigby, Jr., Fish & Richardson, P.C., Boston, MA, for Grinnell Corporation.

Lewis F. Gould, Jr., Joseph A. Battipaglia, Eckert, Seamans, Cherin & Mellott, Philadelphia, PA, Daniel Van Dyke, Terence J. Linn, Price, Heneveld, Cooper, Dewitt and Litton, Grand Rapids, MI, for Viking Corporation and New Supply Inc.

MEMORANDUM

JOYNER, District Judge.

Today we resolve parallel motions filed in two separate patent infringement cases. Plaintiff Central Sprinkler Company is a manufacturer and seller of automatic fire sprinklers and sprinkler systems. It owns a patent for a product called the Extended Coverage Ceiling Sprinkler and System, numbered 5,366,022 ("'022 Patent"). Central has brought three lawsuits alleging that the various Defendants are infringing the `022 Patent by manufacturing, using and selling sprinklers. The lawsuits also allege that the ceiling sprinkler industry is fiercely competitive and that together, the Defendants and Plaintiff account for at least 80% of the relevant market. The Defendant in the first lawsuit, Action 94-7481, but not involved in the instant discovery dispute, is the Reliable Automatic Sprinkler Co., Inc. The Defendant in Action 94-7482 is Grinnell Corporation and the Defendants in 94-7483 are Viking Corporation and Supply Network, Inc (collectively, "Viking").¹

In February, 1995, Viking served Central with Interrogatories and a request for Production of Documents. Two of those Document Requests, numbers 30 and 31, are addressed in this Memorandum. In April, 1995, Grinnell served Central with Interrogatories and a Request for Production of Documents. Interrogatory numbers 4, 20, 21 and 22 are addressed here, as well as Document Request numbers 22 and 45. Grinnell has filed a Motion for a Protective Order to not respond to those discovery requests. Viking and Grinnell responded to Central's Motion and in addition, filed their own Motions to Compel covering the same discovery requests.

All of the discovery requests at issue concern Central's applications for patents that are pending or that Central has abandoned before the United States Patent and Trademark Office ("PTO"). These applications are of two natures, continuing applications and continuing in part applications ("CIP"). A continuing application is one that makes explicit a claim that was inherent in a previously filed application. It contains no new information. Fox Indus., Inc. v. Structural Preservation Sys., 6 U.S.P.Q.2d 1577, 1590, 1988 WL 18937 (D.Md.1988). A CIP application is based on a previously filed application but includes new material to support new claims. Id.

In 1991, Central applied for a patent, application number 07/769,917 ("'917 Application"). Later, it filed a continuing application, application number 07/875,928 ("'928 Application"), based on the '917 Application. Subsequently, Central abandoned the '917 Application in favor of the '928 Application, which ultimately matured into the patent in suit in these actions, the '022 Patent. Viking and Grinnell seek disclosure of all documents and things relating to, mentioning or comprising any pending or abandoned continuing-type applications based on both the '917 Application and the '928 Application. Central objects to the discovery requests on the ground that pending applications are highly sensitive and should be rarely disclosed. Central concedes that it has at least one still-pending continuing-type application based on either the '917 or '928 Applications, but has not disclosed whether it is a continuing application or CIP application. There may also be abandoned applications that were based on the '917 or '928 Applications.

Courts agree that the secrecy of applications should be preserved when possible. Fischer Imaging Corp. v. Lorad Corp., 148 F.R.D. 273, 274 (D.Colo.1993). In part, this is based on a Congressional directive that the PTO must keep patent applications confidential unless disclosure is permitted by the applicant. Id.; 35 U.S.C. § 122. Although this directive is not binding on the courts, it is respected in them. Fischer, 148 F.R.D. at 274 (citing cases). Accordingly, courts generally apply a balancing test to decide whether to compel discovery of pending or abandoned applications. Id.; Ideal Toy Corp. v. Tyco Indus., Inc., 478 F.Supp. 1191, 1193 (D.Del.1979). Courts weigh the requesting party's interest in the materials against the objector's interest in secrecy. Id. Direct relevancy weighs on disclosure's side, whereas direct competition in the relevant marketplace by the parties weighs on secrecy's side. Id. Courts also ask whether other sources will provide sufficient information to obviate the need for disclosure. Id.

Defendants² argue that they need the applications for several reasons. First, one of the issues in these cases is the scope of the '022 Patent. Defendants assert that positions taken in an original application as well as continuing applications can be used to define the parameters of a patent's coverage. Haynes Int'l v. Jessop Steel, 8 F.3d 1573, 1579 (Fed.Cir.1993), clarified, 15 F.3d 1076 (Fed.Cir.1994); Jonsson v. Stanley Works, 903 F.2d 812, 818 (Fed.Cir.1990). For this reason, they argue, any determination as to the scope of the '022 Patent should incorporate any limitations, if any, that Central or the PTO has placed on it in the patent's prosecution history. Markman v. Westview Instruments, Inc., 52 F.3d 967, 980 (Fed.Cir. 1995), pet. for cert. filed, July 3, 1995.

Second, Central has indicated that it might use the doctrine of equivalents to gain relief from the alleged infringement. This equitable doctrine is designed to protect patent holders whose patents are not literally infringed. Texas Instruments, Inc. v. United States Int'l Trade Comm., 988 F.2d 1165, 1173 (Fed.Cir.1993). The doctrine holds that if the infringing product is so close to the patented product that it could have been included in the same patent, then it is equivalent, and therefore, protected. Wilson Sporting Goods v. David Geoffrey & Assoc., 904 F.2d 677, 683 (Fed.Cir.1990). A limitation on the doctrine of equivalents is called "file wrapper estoppel" or "prosecution history estoppel." Texas Instruments, 988 F.2d at 1173. Courts look at a patent's prosecution history to determine whether the allegedly equivalent product was ever raised and relinquished by the patent holder or raised and rejected by the PTO examiner during the patent's prosecution history. Id. If it was, then the patent holder is estopped from "obtaining, through litigation, coverage of subject matter" lost during prosecution. Haynes, 8 F.3d at 1577. Because prosecution history estoppel is always at issue in a doctrine of equivalents case, Defendants argue, they need the applications to get a full understanding of the prosecution history behind the '022 Patent.

Third, Defendants argue that they have cited prior art to Central that was not before the PTO when the '917 and '928 Applications were made. Central is under a duty to report this prior art to the PTO as part of its continuing applications. Defendants assert that Central's comments relating to this prior art, as well as the PTO examiner's comments, rejections or objections are directly relevant to this action.

Central makes several arguments why its applications should remain secret. First, it asserts that it and Defendants are direct competitors in the area of ceiling sprinkler systems. Because of this, the danger is great that its competitors may learn not only technical information, but also product development strategies and plans for commercial exploitation. Second, Central argues that Defendants' lawyers in this action are Defendants' regular patent counsel, and so information they learn in this case, even under the terms of the Confidentiality Orders in place in these actions and with all best intentions of those lawyers, would remain in the lawyers' heads for future litigation and product development. Ideal Toy, 478 F.Supp. at 1195.³ Third, Central argues that the Defendants have not demonstrated that they have any need for the applications. Because the burden is on the requester to show need, according to Central, this failure is fatal to Defendants' position. Moreover, Defendants have not specifically identified the information they expect to find in the applications. Central argues that any request for the applications is therefore just a fishing expedition and should not be allowed.

Much of Central's arguments are based on the understanding that statements made in later applications can have no bearing on already issued patents. This argument relies on the premise that any assertions made in continuing applications are only relevant to the patent that application is seeking. Central asserts that patent applications, in effect, only have forward effect, and can never act backwards to affect an already issued patent. Central distinguishes Jonsson and Haynes, cited by Defendants, by pointing out that neither case involved pending applications, but rather, applications for already issued patents. Also, it argues that Haynes is irrelevant because it did not involve claim construction, but estoppel.

Central asserts that because it has not been determined whether the doctrine of equivalents applies to the facts of this case, that discovery on that claim is premature. Central argues further that prosecution history estoppel does not require disclosure of pending applications. First, it points out that one rationale behind estoppel is that the PTO's records, being public, can...