Geo M. Martin Co. v. Alliance Mach. Sys. Int'l LLC

• Decision Date: 20 August 2010
• Docket Number: No. 2009-1132,2009-1151.,2009-1132
• Citation: 618 F.3d 1294
• Parties: GEO M. MARTIN COMPANY and the Martin Family Trust-1989, Plaintiffs-Appellants,v.ALLIANCE MACHINE SYSTEMS INTERNATIONAL LLC, Defendant-Cross Appellant.
• Court: U.S. Court of Appeals — Federal Circuit

618 F.3d 1294

GEO M. MARTIN COMPANY and the Martin Family Trust-1989, Plaintiffs-Appellants,v.ALLIANCE MACHINE SYSTEMS INTERNATIONAL LLC, Defendant-Cross Appellant.

Nos. 2009-1132, 2009-1151.

United States Court of Appeals Federal Circuit.

Aug. 20, 2010.

COPYRIGHT MATERIAL OMITTED

Kenneth E. Keller, Krieg Keller Sloan Reilley & Roman LLP, of San Francisco, CA, argued for plaintiffs-appellants. With him on the brief were Christopher T. Holland and Michael D. Lisi.

J. Thomas Vitt, Dorsey & Whitney LLP, of Minneapolis, MN, argued for defendant-cross appellant. With him on the brief were Sri K. Sankaran, John J. Brogan and Bart B. Torvik.

Before RADER,^* Chief Judge, ARCHER and PROST, Circuit Judges.

RADER, Chief Judge.

Following a trial for patent infringement that resulted in a hung jury, the United States District Court for the Northern District of California ruled as a matter of law that U.S. Patent No. 6,655,566 (the “'566 patent”) would have been obvious at the time of invention. Geo. M. Martin Co. v. Alliance Mach. Sys. Int'l, LLC, 634 F.Supp.2d 1024 (2008) ( JMOL Opinion ). Because the record supports the trial court's judgment, this court affirms.

I

A “bundle breaker” is a machine used to separate stacked sheets of corrugated board. The '566 patent claims an improvement over the traditional bundle breaker by providing “compliance structures,” which allow a bundle breaker to simultaneously break multiple stacks of corrugated board (logs) of different heights.

The assembly line in corrugated board manufacturing plants typically includes a number of machines that prepare stacks of corrugated board, or bundles.

First, a rotary die cutter scores a single sheet of corrugated board, creating a series of “weakened lines” so that the board can be separated later into individual boxes. Next, a stacker collects multiple sheets and stacks them into a “log.” The stacker aligns the sheets' weakened lines so that each log contains a series of “weakened planes.” The bundle breaker then separates a log into individual bundles by “breaking” the log along the weakened planes. Finally, a load former puts the bundles onto pallets.

The '566 patent, filed on August 28, 2002, and issued on December 2, 2003, shows a bundle breaker separating a log (4) into separate bundles (2 and 3):

A typical bundle breaker, as essentially shown in this Figure 14, has an upstream conveyor belt (10) and a downstream conveyor belt (13) separated by a gap. When the weakened plane (9) of a log straddles the gap, or “breaking line,” the conveyor belts are stopped, and independent clamps (16 and 17) are lowered to hold the log in position. The downstream portion of the bundle breaker then pivots about an axis (103) to break off a bundle. Unlike the bundle breaker shown above, a typical bundle breaker might transfer the separated bundle off of the downstream conveyor before advancing the remaining portion of the log to continue the breaking process.

Bundle breakers of this sort were well known in the art when the application for the '566 patent was filed. The '566 patent specification describes one prior art bundle breaker, the Pallmac machine, as one that would feed two or more logs through its bundle breaker side by side in order to speed production. As described in the '566 patent, however, this multiple-log approach came with problems. Specifically, if one or more of the side-by-side logs were higher than the others, due perhaps to a miscount in the number of sheets, the rigid clamps used to hold the logs in position while breaking would exert a different amount of pressure on each log. The '566 patent describes the result of unequal pressure:

[M]ore pressure is exerted on the taller logs which can damage compressible material like corrugated cardboard. If the logs are not compressible, then insufficient pressure is placed on the shorter logs and shifting of the logs can occur when the bundles are broken off from the log.... In the industry, this problem is called a ‘lack of compliance’ problem; i.e., the force on all the side by side logs is not substantially equal.

'566 patent, col.2 ll.16-31.

The inventors of the '566 patent, Merrill Martin and Daniel Talken, came up with an improved clamp structure to solve the lack of compliance problem, which they called a “compliance structure.” An example of the inventors' compliance structure is shown most clearly in Figure 20 of the patent:

The compliance structure (20) includes a fluid-pressurized structure (21) that is connected to a plurality of rigid members (46-55)-which the parties call “platens”-through a flexible member (22).

The '566 patent describes two identical compliance structures on both the upstream and downstream clamps. When each clamp is lowered during operation, the platens will contact the taller log (4') first. The fluid-pressurized structure will then deform the flexible member and allow the clamp to continue to lower until the platens contact the shorter log (4). The fluid pressurized structure allows every platen that touches a log to exert an equal amount of pressure on that log, regardless of its height.

Claim 1 of the '566 patent, the only independent claim, appears in Jepson form. In other words, the preamble describes prior art bundle breakers and then claims the compliance structure mounted on each upper clamp as an improvement. See The Manual of Patent Examining Procedure (“MPEP”) § 2129 ¶ III (8th ed., rev.8, July 2010) (explaining Jepson claims). Claim 1 recites (emphasis added):

An improvement in a bundle breaker for separating bundles from a log having a generally planar top surface, said log including a plurality of sheets each having a generally planar top surface and each sheet is formed with at least one weakened line, said weakened lines are vertically aligned in said log forming a weakened plane in said log, said bundle breaker including a first conveyor for conveying said log and having an upstream end for receiving said log and a downstream end, and a second conveyor having an upstream end positioned immediately adjacent to said downstream end of said first conveyor providing a gap therebetween defining a bundle breaking plane, said bundle breaker including first clamp means mounted for vertical reciprocating movement above said first conveyor, and second clamp means mounted above said second conveyor for vertical reciprocating movement in relation to said second conveyor and said second conveyor and said second clamp means mounted for conjoint pivotal movement in relation to said bundle breaking plane for progressively breaking a bundle from said log along said weakened plane in said log said improvement comprising:

a a first compliance structure mounted on said first clamp means including,

(1) a first fluid pressurized structure having a first flexible member presenting a first engagement area for operative engagement with an upstream portion of said generally planar top surface of said log and on the upstream side of said weakened plane in said log; and

b a second compliance structure mounted on said second clamp means including,

(1) a second fluid pressurized structure having a second flexible member presenting a second engagement area for operative engagement with a downstream portion of said generally planar top surface of said log and on the downstream side of said weakened plane in said log.

The dependent claims add various limitations that are in accordance with the description provided above. For example, Claim 2 requires that each conveyor have “a width sufficient to simultaneously transfer and support a plurality of logs in side by side relation.” Claim 3 further requires that the fluid pressurized structures engage the plurality of logs where “at least one log [has] a height greater than at least one other log.” Claim 4 requires the flexible members to extend “substantially the width of said logs” in the proximity of the weakened plane. Claim 7 requires each flexible member to have a plurality of “closely spaced rigid members ... for engaging said logs.” Claim 13 claims an indexing capability, which means that the downstream conveyor can “receive and hold at least two bundles broken successively” before discharging them from the conveyor. And claim 14 adds the same indexing improvement to a bundle breaker capable of breaking two or more logs simultaneously, meaning that the downstream conveyor is able “to receive and hold at least two or more rows of bundles broken successively from a plurality of logs in side by side relation.” Col.18 ll.33-38 (emphasis added).

II

Plaintiff The Martin Family Trust (the “Trust”) is the assignee of the '566 patent. Plaintiff George M. Martin Co. (“Martin”) sells the Quik-Break Nicked Bundle Separator (the “Quik-Break”), which incorporates the invention claimed in the '566 patent. Martin began offering the Quik-Break for sale in 2002 and has sold approximately 60 bundle breakers.

Martin has been in the stacker business for a great deal longer than the bundle breaking business-since 1960-and has sold nearly 2,900 stackers in North America alone. In all, Martin has about 90 percent of the stacker market.

Defendant Alliance Machine Systems International LLC (“Alliance”) is Martin's main competitor in the market for bundle breakers that break multiple bundles having uneven heights. Alliance typically sells between 10-15 bundle breakers per year.

The Trust and Martin sued Alliance in February of 2007, alleging that Alliance's bundle breaker infringed the '566 patent. As a part of its defense, Alliance alleged that Martin lacked standing to sue because Martin did not have a sufficient license to the '566 patent. Although the Trust's and Martin's interests are aligned as to liability, Alliance sought to dismiss Martin because Plaintiffs only sought damages based on Martin's lost profits (as opposed to damages based on a reasonable royalty for the '566 patent). The district court held a bench trial solely on the issue of...