Centricut, LLC v. Esab Group, Inc.

• Decision Date: 06 December 2004
• Docket Number: No. 03-1614.,No. 03-1574.,03-1574.,03-1614.
• Citation: 390 F.3d 1361
• Parties: CENTRICUT, LLC (New Hampshire), Plaintiff/Counterclaim Defendant-Appellant, and Centricut, LLC (Delaware), Counterclaim Defendant-Appellant, v. THE ESAB GROUP, INC., Defendant/Counterclaimant-Cross Appellant.
• Court: U.S. Court of Appeals — Federal Circuit

390 F.3d 1361

CENTRICUT, LLC (New Hampshire), Plaintiff/Counterclaim Defendant-Appellant, and Centricut, LLC (Delaware), Counterclaim Defendant-Appellant, v. THE ESAB GROUP, INC., Defendant/Counterclaimant-Cross Appellant.

No. 03-1574.

No. 03-1614.

United States Court of Appeals, Federal Circuit.

December 6, 2004.

Edward A. Haffer, Sheehan Phinney Bass & Green, PA, of Manchester, New Hampshire, argued for plaintiffs/counterclaim defendants-appellants. With him on the brief were Michael J. Bujold and Neal E. Friedman, Davis & Bujold, P.L.L.C., of Manchester, New Hampshire.

Blas P. Arroyo, Alston & Bird, LLP, of Charlotte, North Carolina, argued for defendant/counterclaimant-cross appellant. With him on the brief was Richard M. McDermott.

Before MICHEL, CLEVENGER, and DYK, Circuit Judges.

DYK, Circuit Judge.

Centricut, LLC (New Hampshire) and Centricut, LLC (Delaware) (collectively "Centricut") appeal the judgment of the United States District Court for the District of New Hampshire, finding that Centricut infringed U.S. Patent No. 5,023,425 (the "'425 patent") and assessing damages in favor of The Esab Group, Inc. ("Esab"), the assignee of the '425 patent. Esab cross appeals the damages award. We hold that Esab did not meet its burden in proving infringement, reverse the judgment of infringement, and dismiss the cross appeal as moot.

BACKGROUND

The central issue in this case is whether the absence of relevant expert testimony resulted in a failure of proof.

I

Esab and Centricut are competitors in the plasma arc cutting torch market. Both companies manufacture and sell electrodes used in plasma arc torches. The electrodes must be replaced periodically. Centricut manufactures replacement electrodes. Esab is the assignee of the '425 patent, which claims an electrode for plasma arc torches and a method of fabricating the electrode. Centricut filed for a declaratory judgment that its product did not infringe the '425 patent. Centricut also sought a declaration that the '425 patent was invalid and unenforceable. Esab counterclaimed, alleging that Centricut had infringed, inter alia, claims 1 and 8 of the '425 patent.

II

Plasma arc torches use an electric arc to superheat a stream of gas to temperatures of around 30,000 degrees Kelvin. This heated, ionized gas, or plasma, is used to cut metal. Different gasses are used to cut metals of different types and thicknesses. Oxygen gas is particularly suitable for cutting carbon steel up to one and one-half inches thick. However, cutting with oxygen is difficult because its use leads to frequent electrode failures and short electrode life.

Most prior art plasma arc torch electrodes consist of two parts: an emissive insert and a holder. The electric arc (that heats the gas) knits off of the emissive insert and runs between the electrode and the metal being cut. The emissive insert is commonly made of a metal such as hafnium, zirconium, or tungsten, or an alloy of these metals. The emissive insert is embedded in the holder. The holder is commonly made of a high thermal conductivity metal such as copper or an alloy of copper, and apparently cools the emissive insert with means such as circulating water.

The electrode of the '425 patent renders the plasma arc cutting of carbon steel by use of oxygen gas more economical as compared to prior art electrodes. The '425 patent discloses a three-part electrode that comprises an emissive insert, a holder, and a sleeve positioned between the emissive insert and the holder. The emissive insert and holder of the '425 patent's electrode are composed of the same materials as prior art electrodes. '425 patent, col. 3, ll. 4-46. The '425 patent states that prior art electrodes operating in an oxidizing environment, such as oxygen or air, fail when the copper holder oxidizes and begins to support the arc in preference to the emissive insert. Id. at col. 1, ll. 33-43. This occurs because oxidized copper has a lower "work function" than non-oxidized copper. Id.

What is different about the '425 patent is the sleeve. The sleeve is made of a material, such as silver, with a high "work function" relative to the emissive insert. Id. at cols. 1-2. The addition of the sleeve keeps the arc on the emissive insert even as the copper holder becomes oxidized and thus increases the electrode's useful life. Id. at col. 2, ll. 23-28. Therefore, according to the '425 patent, the improved performance of the electrode is a result of the relative "work functions" of the emissive insert, the holder, and the sleeve.

Claim 1 of the '425 patent is stated in terms of "work function" and reads:

1. An electrode adapted for supporting an arc in a plasma arc torch and comprising

a metallic holder having a front end, and a cavity in said front end, and

an insert assembly mounted in said cavity and comprising an emissive insert composed of a metallic material having a relatively low work function, and a sleeve surrounding said emissive insert so as to separate said emissive insert from contact with said holder, said sleeve having a radial thickness of at least 0.1 inches at said front-end and being composed of a metallic material having a work function which is greater than that of the material of said emissive insert, and said sleeve being composed of a metal which is selected from the group consisting of silver, gold, platinum, rhodium, iridium, palladium, nickel, and alloys wherein at least 50% of the composition of the alloy consists of one or more of said metals and

whereby said sleeve acts to resist movement of the arc attachment point from said insert to said holder.

Id. at col. 7, ll. 26-47 (emphases added).¹

By agreement of the parties, the district court construed the term "`work function' as `the potential step, measured in electron volts, which permits thermionic emission from the surface of a metal at a given temperature.'" Centricut, LLC v. Esab Group, Inc., No. 99-CV-39, slip op. at 9, 2002 WL 220057 (D.N.H. Feb. 7, 2002). "Work function is an energy. It's the energy that's required to remove an electron from inside the material to outside the material." (J.A. at 645.) By definition it is easier to move an electron from a low work-function surface than a high work-function surface.

Centricut's accused electrode is similar to Esab's patented electrode. It comprises an emissive insert composed of hafnium or hafnium alloy, a holder composed of copper or copper alloy, and a ring or washer (which Esab viewed as satisfying the "sleeve" requirement) composed of silver or silver alloy positioned between the emissive insert and the holder.² Like Esab's electrode, the Centricut electrode exhibits significantly reduced electrode failure and a longer useful life than prior art electrodes when used with oxygen gas.

III

The district court held a bench trial to determine (1) whether Centricut's accused device infringed claims 1 and 8 of the '425 patent; (2) whether the '425 patent was invalid due to anticipation or obviousness; and (3) what, if any, damages should be awarded if the '425 patent was in fact valid and infringed. There was no dispute concerning the district court's claim construction of the work-function limitation. The question was whether the accused device satisfied the limitation. Both parties called witnesses to testify on infringement and with respect to work function, although Centricut was the only party to introduce expert testimony. Neither party introduced any evidence of tests conducted to directly measure the work function of the materials used in the accused device. Indeed, neither party introduced evidence of tests or other evidence concerning the exact materials used in the accused device. The only test evidence that Esab introduced concerning the accused device concerned the useful life. In that test, Esab used prior art electrodes and the accused device for long periods of time, usually until the point of failure. The tests showed that the accused device had an average useful life over four times longer than prior art electrodes.

Centricut's expert, physics professor Dr. Marten denBoer, testified that it was not possible to determine the relative work functions of the sleeve and the emissive insert of the accused device without direct testing because many factors affect the work function of a surface. In support of this testimony he submitted tables from various reference texts reporting the work functions of samples of various pure elements, but concluded that these tables established nothing about the relative work function of the sleeve and emissive insert of the accused device. This is because work function is not an intrinsic property of a metal, but is rather a property of specific surfaces under specific conditions. The tables were therefore not representative of the torch under actual operating conditions.

In contrast, Esab argued that the tables showed the Centricut electrode infringed because the work-function values recorded in the tables for hafnium were lower than almost all of those recorded for silver. Esab argued alternatively that the useful life testing was a surrogate for relative work function and that, because Centricut's accused electrode displayed a significantly longer useful life than prior art electrodes, it must be because the sleeve had a higher work function than the emissive insert. Finally, Esab argued that the relative work functions of hafnium and silver could be inferred from hafnium's use in emissive inserts and silver's nonuse in emissive inserts. As discussed in greater detail below, Esab introduced no expert testimony in support of any of these three alternative theories.

Claims 1 and 8 of the '425 patent differ in that claim 1 requires the sleeve to have a work function higher than that of the emissive insert, whereas claim 8 requires the sleeve to have a work function higher than that of both the emissive insert and the holder. The district court concluded that Centricut had...