Entegris, Inc. v. Pall Corp., 2004-1440.

• Court: United States Courts of Appeals. United States Court of Appeals for the Federal Circuit
• Citation: 490 F.3d 1340
• Docket Number: No. 2005-1266.,No. 2004-1440.,No. 2005-1265.,No. 2006-1374.,2004-1440.,2005-1265.,2005-1266.,2006-1374.
• Parties: ENTEGRIS, INC. (formerly known as Mykrolis Corporation), Plaintiff-Cross Appellant, v. PALL CORPORATION, Defendant-Appellant.
• Decision Date: 13 June 2007

490 F.3d 1340 ENTEGRIS, INC. (formerly known as Mykrolis Corporation), Plaintiff-Cross Appellant,
v.
PALL CORPORATION, Defendant-Appellant. No. 2004-1440. No. 2005-1265. No. 2005-1266. No. 2006-1374. United States Court of Appeals, Federal Circuit. June 13, 2007.

[490 F.3d 1341]

John T. Montgomery, Ropes & Gray, LLP, of Boston, MA, argued for plaintiff-cross appellant. With him on the brief was Dalila Argaez Wendlandt. Of counsel on the brief were Susan G.L. Glovsky, John L. DuPré, and Kevin T. Shaughnessy, Hamilton, Brook, Smith & Reynolds, P.C., of Concord, MA.

H. Michael Hartmann, Leydig, Voit & Mayer, LTD., of Chicago, IL, argued for defendant-appellant. With him on the brief were Mark E. Phelps and Jeremy C. Lowe.

Before GAJARSA, LINN, and MOORE, Circuit Judges.

MOORE, Circuit Judge.

Mykrolis Corporation ("Mykrolis")¹ sued Pall Corporation ("Pall") in the United States District Court for the District of Massachusetts, asserting infringement of U.S. Patent Nos. 6,068,770 (the '770 patent) and 6,378,907 (the '907 patent) by certain fluid filtering devices manufactured and sold by Pall. The district court granted Mykrolis' motion for a preliminary injunction. Mykrolis Corp. v. Pall Corp., No.

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03-10392, 2004 WL 937330, 2004 U.S. Dist. LEXIS 7523 (D.Mass. Apr. 30, 2004) (preliminary injunction order). After subsequent motions by the parties, the court held Pall in contempt for violating the injunction but, in the same order, dissolved the injunction based, at least in part, on a newly-raised invalidity challenge to the asserted patents. Mykrolis Corp. v. Pall Corp., No. 03-10392, 2005 WL 81920, *3-4, 2005 U.S. Dist. LEXIS 518, *11-12 (D.Mass. Jan. 12, 2005) (contempt order). Pall appeals the district court's finding that Pall was in contempt. We dismiss that appeal for lack of jurisdiction. Mykrolis cross-appeals the court's order dissolving the preliminary injunction. Because the district court did not abuse its discretion in dissolving the preliminary injunction, we affirm that decision.

BACKGROUND

Plaintiff-cross appellant Mykrolis and defendant-appellant Pall are competitors in the industry of filtration systems for semiconductor manufacturing. Mykrolis is the assignee of the '770 and '907 patents. The '770 and '907 patents disclose fluid filtration systems having a filter module that can be simply inserted into and held in fluid tight connection with a manifold structure. In March 2003, Mykrolis initiated the present patent infringement lawsuit against Pall and simultaneously moved for a preliminary injunction with respect to Pall's accused PhotoKleen™ EZD-2 filter assembly product. Mykrolis moved for a preliminary injunction on the ground that Pall's EZD-2 assembly product infringed at least claim 3 of the '770 patent and claim 1 of the '907 patent.

At the close of an expedited discovery period following the injunction request, the court held a five-day evidentiary and claim construction hearing. On April 30, 2004, the district court issued a Memorandum and Order, setting forth its claim construction with respect to claim 3 of the '770 patent and claim 1 of the '907 patent. Mykrolis Corp., No. 03-10392, 2004 WL 937330, at *3-7, 2004 U.S. Dist. LEXIS 7523, at *8-21. The Order also granted Mykrolis a preliminary injunction, enjoining Pall from "making, using, selling, or offering to sell . . . the product now being sold under the name PhotoKleen™ EZD-2 filter Assembly, or any colorable imitation thereof." Id. at *11, 2004 U.S. Dist. LEXIS 7523, at *34.²

Pall thereafter ceased sales of the EZD-2 filter assembly and began selling a modified assembly. The new design (referred to herein as the "EZD-3" or the "slotted EZD-3" assembly) eliminated a tab on the bottom of the filter module component that previously engaged a slot in the manifold to provide proper alignment of the components. Pall filed a motion seeking clarification of the scope of the preliminary injunction with respect to the new slotted EZD-3 assemblies, but Pall withdrew that motion as "moot" because it concluded that its modified filter assemblies "are without question not the EZD-2 filter assemblies . . . nor colorable imitations thereof." Instead, Pall amended its earlier-filed declaratory judgment complaint seeking a declaration of noninfringement with respect to the new design. Mykrolis moved the district court to hold Pall in contempt for violating the preliminary injunction order by its sales of the EZD-3 assembly and requested damages that Mykrolis allegedly suffered because of Pall's violations of the preliminary injunction order. The district court held a hearing on July 14, 2004 on

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Mykrolis' contempt motion and took the matter under advisement.

In August 2004, before the district court ruled on the contempt motion, two events occurred. First, Pall again modified the design of its accused products, this time removing the slot on the bottom plate of the manifold component's platform, creating the "slotless EZD-3" assembly. Pall ceased distributing the slotted EZD-3 assembly in favor of the slotless EZD-3 assembly. Second, Pall moved to dissolve the preliminary injunction on the basis of two newly-discovered prior art references assigned to Sumitomo Bakelite Co., Ltd. (the Sumitomo references), which Pall argued raised a substantial question regarding the validity of the asserted patent claims.

On January 12, 2005, the district court issued an order holding Pall in contempt of the court's preliminary injunction order for its sales of the slotted EZD-3 assembly. Mykrolis Corp., No. 03-10392, 2005 WL 81920, at *3, 2005 U.S. Dist. LEXIS 518, at *11. The district court assessed a $210,000 fine against Pall for Mykrolis' attorneys' fees and costs in connection with the contempt. The January 12 contempt order also granted Pall's motion to dissolve the preliminary injunction. Id. at *4, 2005 U.S. Dist. LEXIS 518, at *12. The district court concluded that "Pall has cast enough doubt on the validity of the Mykrolis patents with respect to the Sumitomo references that it can no longer be said that Pall's invalidity defenses lack substantial merit." Id.

Both parties now appeal the court's January 12 order. Pall appeals the court's finding of contempt; however, Pall does not contest the amount of the assessed fine. Mykrolis cross-appeals the district court's decision to dissolve the preliminary injunction.

ANALYSIS I.

"It is axiomatic that the initial inquiry in any appeal is whether the court to which appeal is taken has jurisdiction to hear the appeal." Woodard v. Sage Prods., 818 F.2d 841, 844 (Fed.Cir.1987) (en banc). This court is thus obligated to consider whether it has jurisdiction even when the issue is not raised by either party. Bender v. Williamsport Area Sch. Dist., 475 U.S. 534, 541, 106 S.Ct. 1326, 89 L.Ed.2d 501 (1986); Pandrol USA, LP v. Airboss Ry. Prods., Inc., 320 F.3d 1354, 1362 (Fed.Cir.2003) (citing View Eng'g, Inc. v. Robotic Vision Sys., Inc., 115 F.3d 962, 963 (Fed.Cir.1997)). We apply Federal Circuit law to issues of our own appellate jurisdiction. Int'l Elec. Tech. Corp. v. Hughes Aircraft Co., 476 F.3d 1329, 1330 (Fed.Cir.2007); Woodard, 818 F.2d at 844.

A.

Pall contends that this court has jurisdiction over its appeal of the contempt order as an interlocutory appeal under 28 U.S.C. § 1292(c)(1). Section 1292(c)(1) provides that "[t]he United States Court of Appeals for the Federal Circuit shall have exclusive jurisdiction (1) of an appeal from an interlocutory order or decree described in subsection (a) or (b) of this section in any case over which the court would have jurisdiction of an appeal under section 1295 of this title." 28 U.S.C. § 1292(c)(1). section 1292(a) provides that the courts of appeals have jurisdiction over "interlocutory orders of the district courts of the United States . . . granting, continuing, modifying, refusing or dissolving injunctions, or refusing to dissolve or modify injunctions, except where a direct review may be had in the Supreme Court."³ The

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contempt order which Pall is appealing does none of these.

The Supreme Court has stated, in general, that Section 1292(a) should be narrowly construed:

Because § 1292(a)(1) was intended to carve out only a limited exception to the final-judgment rule, we have construed the statute narrowly to ensure that appeal as of right under § 1292(a)(1) will be available only in circumstances where an appeal will further the statutory purpose of "permit[ting] litigants to effectually challenge interlocutory orders of serious, perhaps irreparable, consequence." Unless a litigant can show that an interlocutory order of the district court might have a "serious, perhaps irreparable, consequence," and that the order can be "effectually challenged" only by immediate appeal, the general congressional policy against piecemeal review will preclude interlocutory appeal.

Carson v. Am. Brands, Inc., 450 U.S. 79, 84, 101 S.Ct. 993, 67 L.Ed.2d 59 (1981) (internal citations omitted). Since Carson, at least one Supreme Court case acknowledged that the "serious, perhaps irreparable consequence" standard set forth in Carson is intended to apply to situations like this one, where a court order does not on its face modify, grant, refuse, dissolve, or continue an injunction but where it is alleged to have the same effective consequence as an interlocutory appeal in section 1292(a). Gulfstream Aerospace Corp. v. Mayacamas Corp., 485 U.S. 271, 287-88, 108 S.Ct. 1133, 99 L.Ed.2d 296 (1988) ("Section 1292(a)(1) will, of course, continue to provide appellate jurisdiction over orders that grant or deny injunctions and orders that have the practical effect of granting or denying injunctions and have `serious, perhaps irreparable, consequence.'").

In this case, Pall argues that the contempt order is an appealable interlocutory order that falls within section 1292(a)(1) because "in order to find Pall in...