General Plywood Corp. v. Georgia-Pacific Corp.

• Decision Date: 24 July 1973
• Docket Number: Civ. A. No. 1127.
• Citation: 362 F. Supp. 700
• Parties: GENERAL PLYWOOD CORPORATION, Plaintiff, v. GEORGIA-PACIFIC CORPORATION, Defendant.
• Court: U.S. District Court — Southern District of Georgia

362 F. Supp. 700

GENERAL PLYWOOD CORPORATION, Plaintiff, v. GEORGIA-PACIFIC CORPORATION, Defendant.

Civ. A. No. 1127.

United States District Court, S. D. Georgia, Savannah Division.

July 24, 1973.

W. Spencer Connerat, Jr., Connerat, Dunn, Hunter, Houlihan, Maclean & Exley, Savannah, Ga., John A. Blair, Harness, Dickey & Pierce, Detroit, Mich., for plaintiff.

Thomas H. Gignilliat, Gignilliat & Abbott, Savannah, Ga., John Vaughan Groner, Fish, Richardson & Neave, New York City, for defendant.

LAWRENCE, Chief Judge.

ORDER ON PLAINTIFF'S OBJECTIONS TO REPORT OF SPECIAL MASTER

1. History of Litigation

This canescent patent case was filed in 1959 and is now going on fourteen years old.

On December 9, 1959, General Plywood Corporation filed a complaint charging Georgia-Pacific Corporation (a) with infringement of United States patent No. 2,827,935 and (b) with violation of an alleged confidential disclosure of the patented process before the patent issued to General Plywood on March 25, 1958. Injunctive relief, accounting for profits, treble damages and attorney's fees were sought.

Georgia-Pacific filed an answer and counterclaim denying infringement and asserting invalidity of the patent.¹ It denied any use of the process disclosed by General Plywood. Defendant prayed that the complaint be dismissed and asked for declaratory and injunctive and other relief.

The patent relied on by General Plywood discloses and claims "certain new and useful improvements in wood products and in a method of and apparatus for treating wood surfaces." The principal object of the patent, as stated in the application of George E. Alexander, is "to provide a novel wood surface treating process which can be simply and inexpensively carried out and which results in the substantial improvement of that surface in one or more respects such as increased hardness, smoothness and reflectivity and reduced porosity and absorbency." "Microseal" is the name given to the process by General Plywood.

Between 1959 and November, 1961, voluminous depositions were taken in this case. At that time Judge Scarlett appointed John E. Simpson as Special Master with authority to pass upon all questions of law and fact.

Shortly thereafter, proceedings in the case were stayed by agreement of the parties pending determination of the same issues in United States Plywood Corporation v. General Plywood Corporation in the United States District Court for the Western District of Kentucky. In that litigation United States Plywood had sought a declaratory judgment as to the validity of the patent issued in 1958 to George E. Alexander which was owned by General Plywood under an assignment from the inventor. After a lengthy trial the District Judge, sitting without a jury, ruled that the Alexander patent was valid but not infringed. The Court said that all of the evidence from which infringement could be inferred involved the use of 8/0, 9/0 and 10/0 abrasives or sandpaper. "There is no proof that United States Plywood was using cork or non-metallic abrasives in any of the accused operations; hence, there is no foundation upon which an infringement could be based." 230 F.Supp. 831 at 836.

On appeal, the ruling was affirmed in 1966 by the Sixth Circuit. It pointed out that infringement is generally a question of fact and that the finding below was not "clearly erroneous." The Court of Appeals noted that "the 10/0 sanding employed by United States Plywood did remove significant amounts of stock" and pointed out that observers "testified to visible dust and the necessity of dust collectors on the `Micro-Fine' process where General Plywood contends such were not necessary in microsealing." United States Plywood Corporation v. General Plywood Corporation, 370 F.2d 500 (1966); cert. den. 389 U.S. 820, 88 S.Ct. 39, 19 L.Ed.2d 71.

As happens on occasion with the Patent Bar when a stay is granted in order to await a decision in another court the result of which is represented as important or even determinative, things did not turn out that way. Five years after the stay of proceedings General Plywood did not agree that the Sixth Circuit decision had any effect in the present litigation.²

Early in 1968 this case came out of hibernation. Georgia-Pacific moved for summary judgment on the non-infringement issue contending that the process used by it was exactly the same as that held not to infringe in the litigation in Kentucky between United States Plywood and General Plywood.

The Special Master held a hearing on the Motion for Summary Judgment April 9-11, 1969. Briefs and proposed Findings of Fact and Conclusions of Law were subsequently filed. After Mr. Simpson submitted his proposed findings and conclusions to the parties General Plywood asked for a hearing as to "newly discovered evidence." The request was granted and further evidence (260 pages of it) was received in September, 1970. The hearing included demonstrations by way of comparisons made on test panels between Georgia-Pacific's 10/0 "sanding" and General Plywood's 10/0 "Microsealing" processes.

2. The Patent Claims

General Plywood's patent 2,827,935 discloses and claims a process for treating the surface of plywood panels or doors to provide a glossy, relatively non-porous or densified surface. "Sanding" (use of sandpaper) is recognized in the patent and was acknowledged to the Patent Office to be well known in the prior art. Plaintiff contends that its patented process differs from a "sanding" operation in that a relatively nonabrasive frictional rubbing belt is used to soften and densify the wood at its surface. The accused process uses "a paper belt having a coat of aluminum oxide particles bonded to its surface, such particles being partially embedded in the bonding material, the grit having a degree of fineness of 10/0." Finding No. 10. The belt represents "a coated abrasive, i. e., `sandpaper'." Finding No. 26.

The core of the controversy appears to be whether such a belt is a "relatively nonabrasive" friction medium or rubbing surface as required by claims 1 to 11 or the "unabrasive" surface which is prescribed in claims 12 to 18 of the patent. If the process and rubbing surface is not "relatively nonabrasive" or "unabrasive", there is no infringement. A method or process claim is not infringed unless the accused process utilizes all steps, stages and elements of the method claimed in the patent. Conclusion of Law No. 16, citing Engelhard Industries Inc. v. Research Instrumental Corporation, 324 F.2d 347, 351 (9th Cir.); cert. den. 377 U.S. 923, 84 S.Ct. 1220, 12 L.Ed.2d 215; Texas Rubber & Specialty Corporation v. D. & M. Machine Works et al., 81 F.2d 206, 209 (5th Cir.); Getty v. Kinzbach Tool Co., Inc., 119 F.2d 249 (5th Cir.); FMC Corporation v. City of Greensboro, 208 F.Supp. 494, 503 (M.D.N.C.).

Claims are to be interpreted and read in the light of the description given in the specifications. United States v. Adams, 383 U.S. 39, 49, 86 S.Ct. 708, 15 L.Ed.2d 572.

After expressing preference for a belt having a cork surface as the rubbing medium, the patent says, "Any other flexible, yielding, relatively nonabrasive frictional rubbing medium or frictional belt material, such as canvas, or other cloth made of natural or synthetic fibers, may be employed. . . ." Finding No. 5. Sandpapers, coarse or fine, are not mentioned in the patent. "It should be noted also that my process does not make a rough surface smooth, nor does it involve the abrasive cutting or removal of any material." Finding No. 23. It "is essentially a nonabrasive process, as is clear from the fact that even a very light pencil mark made on a piece of wood before treatment is not removed therefrom during the surface treatment." (Apx. 2A, col. 4, lines 13-16). Clearly, the invention claimed in Alexander's patent describes a process that employs a relatively nonabrasive or an unabrasive rubbing medium involving no abrasive cutting or removal of any wood during the surface treatment.

Does the accused process of Georgia-Pacific which utilized a fine sanding operation (a coated abrasive) rather than cork, canvas or other cloth, to obtain essentially the same result as Microsealing, including densification,³ infringe on the patent? Does Georgia-Pacific's process utilize an abrasive rubbing medium or an unabrasive or relatively nonabrasive one? Does defendant's process involve removal or cutting of material during the surface treatment of plywood?

These are essentially questions of fact and remain such no matter how finely drawn the lines of demarcation may be. I reject the contention of plaintiff that the findings of fact, including No. 56, are mere, erroneous conclusions of law.

3. Report of Special Master

On March 19, 1971, the Special Master filed a report finding no infringement by Georgia-Pacific. Lengthy objections to the findings and conclusions were submitted by General Plywood. Argument thereon was had in August, 1971. At that time I remanded the case to the Master for additional findings.⁴

Following the remand, the Special Master held another evidentiary hearing at which additional evidence was presented. The testimony of Dr. Norman Charles Franz, Professor of Forestry at the University of British Columbia who testified as an expert witness for General Plywood, covers 223 pages of the transcript which is 290 pages overall. The record in this case, I will add, contains more than 16,500 pages of typewritten and printed matter.

Dr. Franz testified that "Sanding is . . . a machine process involving the actual cutting away of the material. The microsealing process is primarily a heating and deformation under pressure . . . the two are quite distinct in their operation." Tr., 25. He said that the demonstration panels clearly indicated "the similarity of the use of a cork microseal belt at patent conditions and the 10/0 glue-bonded belt at what is reputed to be Georgia-Pacific conditions. . . ." Tr., 66-67 (11/9/1971)....