Deere & Co. v. Hesston Corp.
| Decision Date | 09 March 1979 |
| Docket Number | 77-1562,Nos. 77-1561,s. 77-1561 |
| Citation | 593 F.2d 956,201 U.S.P.Q. 444 |
| Parties | DEERE & COMPANY, Plaintiff-Appellee and Cross-Appellant, v. HESSTON CORPORATION, Defendant-Appellant and Cross-Appellee. |
| Court | U.S. Court of Appeals — Tenth Circuit |
Dugald S. McDougall, Chicago, Ill. (Dennis McCarthy and Rand L. Cook, Salt Lake City, Utah, and Theodore R. Scott, Chicago, Ill., on brief), for plaintiff-appellee and cross-appellant.
Gordon D. Schmidt, of Schmidt, Johnson, Hovey & Williams, Kansas City, Mo., for defendant-appellant and cross-appellee.
Before HOLLOWAY and DOYLE, Circuit Judges, and STANLEY, * Senior District Judge.
Plaintiff-appellee Deere & Company instituted this action in the United States District Court for the District of Utah. A declaratory judgment to declare certain patents invalid was prayed for against the Hesston Corporation of Hesston, Kansas, the owner of United States Patent No. 3,556,327, entitled "Loose Hay Wagon," issued January 19, 1971, and filed by Harold Keith Garrison April 14, 1969; also, United States Patent No. 3,728,849, entitled "Hay Loader," issued April 24, 1973, on application filed November 14, 1969, by Ezra Cordell Lundahl.
From further allegations in the complaint it appears that Deere has designed and built a hay wagon, has exhibited it and offered it for sale at meetings of farm implement dealers, and is now manufacturing and selling in competition with a hay wagon manufactured and sold by Hesston, named StakHand.
It is further alleged that Hesston notified Deere that it considered the Deere implement to have infringed on both the Garrison and Lundahl Patents. Deere maintains in furtherance of its complaint that the Garrison and Lundahl Patents are invalid and so not infringed; also, it maintains that the Garrison and Lundahl Patents were obtained through fraud on the Patent Office and that they are invalid because of the sale of a prototype of the hay loader in the Lundahl Patent.
The answer on behalf of the defendant-appellant denies the allegations as to the invalidity, fraud and prior sale of a prototype and contains a counterclaim alleging infringement. A supplemental counterclaim lists a series of Hesston Patents. These include those mentioned above together with improvement patents. 1
Plaintiff-appellee Deere has filed a reply to the fourth supplemental counterclaim as a result of which all matters are fully in issue.
This matter was tried to the court before United States District Judge Anderson, District of Utah, who ruled all eight patents of Hesston Corporation invalid under 35 U.S.C. § 102(b) and 35 U.S.C. § 103. The district court essentially ruled that the patents in issue were invalid because they were obvious as provided in 35 U.S.C. § 103 and because they were known to the public for more than one year before the patent application under § 102(b).
The trial court said that the controversy centered around four patents: Lundahl Patent No. 3,728,849, a haystacking method; Lundahl Patent No. 3,828,535, a haystacking machine (Lundahl I Patent and Lundahl II Patent, respectively). The other two primarily involved are the Garrison Patent No. 3,556,327, a haystacking machine, and the Garrison Patent No. 3,847,072, a haystacking method (the Garrison I Patent and Garrison II Patent, respectively).
This controversy had its origins in 1960 and the years following.
The Lundahls, Cordell and Ezra, son and father respectively, were engaged in the manufacture of loose hay wagons. Cordell, the son, saw the need for a machine that would transform loose hay into closely packed haystacks which could either be left in the field or moved to a storage place.
Lundahl's first machine was a simple wagon which compressed the hay. It was loaded by a machine known as a Farmhand grapple fork or a Farmhand. This latter was pulled by a tractor through the hay field where it would pick up loose hay and deposit it into the wagon. This wagon had high side walls and a front panel which moved toward the rear and in so doing compacted the hay against the rear doors. Lundahl discovered that this mechanism loaded the hay unevenly and without a uniform density. The result was disintegration of the hay stack. There were other deficiencies. The loading was a separate function; there was a lack of integrated method of pulling the wagon down the windrow. The operation was in two separate steps, in other words. After the loading there followed the horizontal compaction which was also in stages. Each time In February 1966, Lundahl advertised in a farm journal a one-man automatic feeding system for long hay. While the advertisement said that the machine would stack and compress loose hay from the windrow into neat uniform stacks without any manual handling, at this time an integrated system had not been developed: The wagon still had to be loaded separately. One Warren DePuy purchased one of these incomplete machines. It lacked the attachment which would make the machine self-loading. This was promised at a later date. This is here referred to as the DePuy machine and it was put to use during the 1966 haying season and for part of the 1967 season, but had mechanical difficulties as a result of which DePuy sued the Lundahl Corporation for breach of warranty. After this the machine was abandoned by DePuy.
some hay was loaded it had to be compressed and then more hay would be added and compressed until the wagon was filled. While producing one complete haystack, this process resulted in a stack which tended to separate and fall apart. To overcome this, Lundahl added vertical compression units consisting of two gate-like top presses which would be set as extensions of the side walls and would swing down from the top on hinges powered by hydraulic compressors. Notwithstanding this, though, the principal compression was the horizontal force created by compressing the crop against the back walls of the wagon.
In 1966, the Hesston Corporation, defendant-appellant here, bought the assets of the Lundahl Corporation. 2 Hesston was very much interested in the stacking machine idea and pursued it through one of the engineers for Hesston, Keith Garrison, who worked with Cordell Lundahl on improving the design. Prior to this, Lundahl had come to the realization that vertical compaction was desirable. This led to the development of the swinging top-gates which came down on the loaded haywagon and also the addition of the tuckers to the undersides of the hinged gates on the earlier prototype. So the research was pursued along the line of developing the vertical compaction. Testing along this line continued through 1968 with several prototypes, including a 1966-67 prototype which redesigned top-presser gates integrated with a crop pick-up and distribution system. Eventually Garrison came up with a method of continuous loading of hay into a moving wagon by using the blower duct system with a dispersal mechanism which served to spread the hay evenly. Garrison also discarded the two-gate approach and adopted a single unit, described as an inverted U, which was used to apply downward pressure. These innovations were said to have produced "real good" results which yielded stacks of uniform density and having a self-supporting nature. Also, the stacks were better shaped from the standpoint of shedding water. This machine was ultimately marketed.
Hesston, in the year 1969, commenced the production of the StakHand 60, which made six ton stacks. Some smaller editions or models were added later, such as the StakHand 30, for forming three ton stacks, and the StakHand 10, which produced a one ton stack. Improved models were identified with an "A" after the number.
Deere started selling machines which made one ton stacks, three ton stacks and six ton stacks, all of which appeared to be based on the same design as the Hesston machine. This activity produced the present controversy.
The application for patent on the Garrison I was filed in 1969. It matured January 19, 1971.
At the very outset the Garrison II Patent was rejected on the basis of prior art. The Patent Office ruled that Garrision II was the same as the Sutherland British Patent, the only difference being its blower conveyor. After this, Hesston offered an amendment claiming that it was not based on any prior art and saying that "it is absolutely The Lundahl Patents I and II suffered somewhat the same fate. Lundahl I was filed in 1969 and rejected in 1972. The rejection was based on the prior issuance of Garrison I. Lundahl, by swearing back, established that he had completed his invention prior to the date the Garrison I Patent was filed. The application was accepted and the patent matured in 1973.
new to provide a hay gathering or collection feature in a press as its initial function in cooperation with the main crop receiving body." The Patent was finally issued August 13, 1974.
The Lundahl II, which was also based on the Garrison I, was rejected by the examiner. Again, this objection was overcome by swearing back, but ultimately some but not all of the claims were allowed.
These four described patents, together with four so-called minor patents, were all ruled invalid, and basically these rulings are the issues for consideration on this appeal.
Judge Anderson's opinion, which is published in 456 F.Supp. 520 (D.Utah 1977), constitutes thorough and careful workmanship, and in writing this opinion we have made full use of it. The opinion considers the following issues:
A. Fraud on the Patent Office.
The contention of plaintiff-appellee Deere that fraud was perpetrated on the Patent Office.
B. The patentability of the Garrison, Lundahl and improvement patents. Included was the nonobviousness under § 103, and prior sale or use under § 102(b).
Essentially the contention of fraud...
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