Curtis Mfg. Co., Inc. v. Plasti-Clip Corp.
| Citation | 933 F. Supp. 107 |
| Decision Date | 14 September 1995 |
| Docket Number | Civil No. 89-430-SD,92-360-SD. |
| Parties | CURTIS MANUFACTURING COMPANY, INC. v. PLASTI-CLIP CORPORATION; Daniel Faneuf. PLASTI-CLIP CORPORATION; Daniel Faneuf v. Thomas W. JUDD. |
| Court | U.S. District Court — District of New Hampshire |
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W. Wright Danenbarger, Wiggin & Nourie, Manchester, NH, Jamie N. Hage, Roussos, Hage & Hodes, Manchester, NH, for Daniel Faneuf in Civil Nos. 89-430-SD and 92-360-SD.
ORDER
This hotly contested patent litigation1 brings before the court a number of post-trial motions, to which the respective opponents have interposed objections. This order addresses the issues raised by such pleadings.2
1. Renewed Motions of Curtis Manufacturing Co., Inc. (Curtis), and Thomas W. Judd (Judd) for Judgment as a Matter of Law or, Alternatively, for New Trials or to Alter and Amend Judgment, documents 162, 1633
At issue in this litigation were two United States patents: No. 4,277,863 (the '863 patent) issued to Faneuf, and No. 4,902,078 (the '078 patent) issued to Curtis. The '863 patent described a clipping element, the purpose of which was the attaching of an identification badge to an item of clothing. The '078 patent described a clip for holding documents attached to the side of a word processor for the purpose of comparison or copying. The jury found that Curtis infringed the '863 patent. It further found that Faneuf was the sole inventor of the '078 patent and that Judd actively assisted Curtis in the conversion of said patent.4
To establish infringement, Faneuf was required to prove by preponderant evidence that every limitation set forth in the asserted claim was found in the accused product, either literally or by a substantial equivalent. Wolverine World Wide, Inc. v. Nike, Inc., 38 F.3d 1192, 1196 (Fed.Cir.1994) (citing Johnston v. IVAC Corp., 885 F.2d 1574, 1577 (Fed.Cir.1989)). A "substantial equivalent" could be found to exist if the accused device performed substantially the same function in substantially the same way to achieve substantially the same result. Id. (citing Corning Glass Works v. Sumitomo Elec. USA, Inc., 868 F.2d 1251, 1260 (Fed. Cir.1989)).
At trial this judge followed the recent en banc mandate of the Federal Circuit that in a jury trial the trial judge "has the power and obligation to construe as a matter of law the meaning of language used in the patent claim." Markman v. Westview Instruments, Inc., 52 F.3d 967, 979 (Fed.Cir.1995). The jury was so instructed with respect to literal infringement, and they were also instructed as to the doctrine of equivalents.
Curtis contends that the finding that it infringed the '863 patent demonstrates that the jury failed to follow the instructions of the court. Faneuf points not only to the testimony of its own experts, but to that given by Charles Powell, a Curtis expert, as raising factual issues sufficient to support the jury's finding of infringement.
On review of the record, the court is satisfied that the evidence was sufficient to support the jury's finding of infringement of the '863 patent by Curtis.
On February 20, 1990, the '078 patent issued to Judd and was assigned to Curtis. At trial, Curtis and Judd contended that Judd was the sole or, at the very least, co-inventor of the "document clip" demonstrated in said patent. Instructed with respect to all of these claims, the jury found that Faneuf was the sole inventor of the '078 patent.
Curtis and Judd argue that Faneuf's claims of inventorship fail because they lack corroboration beyond his own oral testimony. Price v. Symsek, 988 F.2d 1187, 1194 (Fed. Cir.1983). But corroborative testimony is not limited to testimony supportive of that given by the inventor, as it may include drawings and prototypes. Id. at 1195-96.
Here the jury had before it a written disclosure, a mock prototype, and drawings which had been prepared by Faneuf in May 1989. These evidentiary items were sufficient to permit the jury to find that Faneuf had carried his burden of proving inventorship by clear and convincing corroborative evidence. Judd's concept of "slideability" does not serve to overcome the weight of such evidence.
Curtis and Judd suggest that the New Hampshire courts would not find the doctrine of conversion applicable to the intangible ideas expressed in a patent. The court respectfully disagrees.
The modern trend of state law protects against the misuse of confidential business information through conversion actions. FMC Corporation v. Capital Cities/ABC, Inc., 915 F.2d 300, 305 (7th Cir.1990) (collecting cases). Curtis and Judd argue that they could not be liable for conversion because their action in seeking a declaratory judgment as to the validity of the '863 patent amounted to a "qualified refusal". LFC Leasing & Finan. Corp. v. Ashuelot Nat'l Bank, 120 N.H. 638, 641, 419 A.2d 1120, 1121 (1980). But the doctrine of "qualified refusal" is grounded on a finding that the reasonable qualification or requirement be stated in good faith or be made known to the owner. LFC Leasing, supra at 640, 419 A.2d at 1121. Declaratory judgment directed only to the issues of infringement, validity, or applicability of the '863 patent cannot serve as a "qualified refusal" to the claim of conversion of the '078 patent.
Faneuf's vigorous prosecution of this litigation belies any claim of abandonment, and it is clear he was not required to provoke interference in the Patent and Trademark Office as a condition of his right to recover for conversion. Richardson v. Suzuki Motor Co., Ltd., 868 F.2d 1226, 1250 (Fed.Cir.1989), cert. denied, 493 U.S. 853, 110 S.Ct. 154, 107 L.Ed.2d 112 (1989).5
As requested by Curtis and Judd, the court instructed the jury on the eight elements necessary for a finding on the issue of misappropriation.6 Suggesting that the jury could not find the presence of such elements, Curtis and Judd argue that the verdict for Faneuf on this issue was in error. Reduced to its basic form, this argument is that there was no notice given of the confidential nature of the disclosure.
Initially and exclusively, the disclosure of the Uni-Clip (a combination of a modified Curtis document holder arm and the Plasti-Clip hanger clip) inspired an indication of enthusiasm for the idea from Curtis. No further disclosure of this idea and its subsequent embodiments was made to anyone except as necessary to manufacture the product until Judd and Curtis decided (without knowledge on the part of Faneuf) to apply for the '078 patent. When Faneuf indicated in a later drawing of the disclosed invention that the information disclosed was confidential, neither Curtis nor Judd interposed objection. Moreover, they never indicated to Faneuf that they previously had the same idea or that there was nothing inventive in Faneuf's disclosure.
Such evidence was sufficient for the jury, following the instructions of the court, to award damages to Faneuf for misappropriation of confidential information. This case is one of invited, not uninvited, disclosure, and thus serves to trigger the law of misappropriation. Smith v. Snap-On Tools Corp., 833 F.2d 578, 580 (5th Cir.1987). Additionally, the witness Hames, the Curtis employee most directly involved in reviewing the invention with Faneuf, testified that a royalty offer was made to Faneuf in connection therewith.7
As there was ample evidence from which the jury could find, as it did, that there was conversion and misappropriation of confidential information, the record was sufficient for the jury to also find unfair competition.
In January 1991, Curtis sought bankruptcy reorganization in the Western District of Texas. Plasti-Clip was notified of the bankruptcy proceedings, but neither filed a proof of claim nor otherwise participated therein. A plan of reorganization for Curtis was confirmed effective April 1, 1993. Curtis now renews its argument, rejected on two prior occasions by the court,8 that failure of Plasti-Clip to participate in the bankruptcy proceedings bars it from further action on the '078 patent.
Each act of patent infringement constitutes a separate cause of action. See A.C. Aukerman Co. v. R.L. Chaides Constr. Co., 960 F.2d 1020, 1031 (Fed.Cir.1992) (). And "alleged acts of infringement that occur post-confirmation are separate causes of action from those that occur pre-confirmation, and the former necessarily give rise only to post-confirmation claims." In re Dahlgren Int'l, Inc., 147 B.R. 393, 404 n. 16 (N.D.Tex.1992).
Accordingly, while Faneuf/Plasti-Clip were entitled to recover damages for use by Curtis of the '078 patent clip only from April 1, 1993, the continuous usage from that date distinguishes this case from those upon which Curtis relies. As "section 1141(d)(1)(A) does not discharge any claim ... which arises from the debtor's use ... post-confirmation," In re Polysat, 152 B.R....
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