Greenwood v. Hattori Seiko Co., Ltd.

• Decision Date: 03 April 1990
• Docket Number: Nos. 89-1619,89-1620,s. 89-1619
• Citation: 900 F.2d 238,14 USPQ2d 1474
• Parties: , 14 U.S.P.Q.2d 1474, 15 Fla. L. Week. D2619 Eugene C. GREENWOOD, Plaintiff-Appellant, v. HATTORI SEIKO CO., LTD., Defendant-Appellee. Eugene C. GREENWOOD, Plaintiff-Appellant, v. SEIKO INSTRUMENTS & ELECTRONICS, LTD., Defendant-Appellee.
• Court: U.S. Court of Appeals — Federal Circuit

Page 238

900 F.2d 238

58 USLW 2619, 14 U.S.P.Q.2d 1474, 15

Fla. L. Week. D2619

Eugene C. GREENWOOD, Plaintiff-Appellant, v.HATTORI SEIKO CO., LTD., Defendant-Appellee.

Eugene C. GREENWOOD, Plaintiff-Appellant, v.SEIKO INSTRUMENTS & ELECTRONICS, LTD., Defendant-Appellee.

Nos. 89-1619, 89-1620.

United States Court of Appeals Federal Circuit.

April 3, 1990.

Maurice U. Cahn, Washington, D.C., argued, for plaintiff-appellant.

Bruce L. Adams, Adams & Wilks, New York City, argued, for defendant-appellee.

Before NEWMAN and ARCHER, Circuit Judges, and DUFF, District Judge.^*

ARCHER, Circuit Judge.

Eugene C. Greenwood appeals from the summary judgment of the United States District Court for the District of Columbia, 711 F.Supp. 30, 13 USPQ2d 1245(D.D.C.1989), holdingU.S. PatentNo. 3,717,140('140 patent) invalid under 35 U.S.C. Sec. 103(1982 and Supp. II 1984) and unenforceable based on inequitable conduct.We vacate-in-part, reverse-in-part and remand.

Background

Greenwood is the owner and patentee of the '140 patent, entitled "Heart Rate Counter with Digital Storage and Numerical Readout," which relates to an apparatus that displays an individual's pulse rate using a combination of electronic elements.Seiko Instruments & Electronics, Ltd. and Hattori Seiko Co., Ltd.(collectively Seiko) are the manufacturer and U.S. distributor, respectively, of SEIKO-brand watches, two models of which are selectively operable in a "pulse-monitoring" mode to monitor and display the heart rate of the person wearing the watch.Believing the sale of these watches in the United States to be an infringement of his patent rights, Greenwood filed suit ¹ against Seiko for infringement of the '140 patent.In response, Seiko filed a request in the United States Patent & Trademark Office(PTO) for reexamination of '140 patent, see35 U.S.C. Secs. 301-307(1982), citing certain prior art which in its view raised a substantial new question as to the patentability of the invention claimed in the '140 patent.The prior art cited in Seiko's request disclosed the use of read-only memories as look-up tables for performing computations.According to Seiko, the examiner was without the benefit of that prior art during the original prosecution of the '140 patent.On June 26, 1987, the PTO granted Seiko's request for reexamination.

During the reexamination proceeding, the examiner rejected each claim of the '140 patent under 35 U.S.C. Sec. 103 as unpatentable over Abbenante, PatentNo. 3,599,628, in view of (1)Ottoway, PatentNo. 3,328,767, or (2) any one of three magazine publications.Greenwood responded to the examiner's rejection by traversing the merits of the Abbenante/Ottoway rejection and by filing an affidavit under 37 C.F.R Sec. 1.131(Rule 131) demonstrating conception of his invention prior to the publication date of the three magazine publications.Consequently, the examiner issued a Reexamination Certificate related to the '140 patent, stating with respect to the magazine publications that "it would appear that the claimed subject matter was conceived in early January 1970, at the latest, which antedates the three publications on which the rejection of the claims is based.Therefore the rejections of claims 1-10 based on those publications are withdrawn."

Following the conclusion of the reexamination proceeding, the district court on motion for summary judgment held that Greenwood's Rule 131 affidavit was insufficient to antedate the three magazine publications because the affidavit was "silent" as to the required showing of diligence between the asserted date of conception and reduction to practice, which Greenwood claimed had occurred approximately five to six months after conception of the invention.The court noted that the examiner apparently considered only the issue of conception and failed to consider the diligence question.Moreover, the court held that there had been no showing made before the PTO that Greenwood had been diligent as required by the regulation, see37 C.F.R. Sec. 1.131(b).711 F.Supp. at 32-33, 13 USPQ2d at 1247.

After finding the Rule 131 affidavit insufficient, the district court apparently felt constrained to reinstate the examiner's rejection.It held all of the claims of the '140 patent invalid under 35 U.S.C. Sec. 103 and, in doing so, stated:

The PTO decided against Greenwood on the basis of the original record, including Seiko's submissions.In Greenwood's affidavits and other materials on reexamination, no attempt was made to undermine the original showing made by Seiko.Instead, plaintiff's documentation at the reexamination was meant to go behind Seiko's evidence, to show that Greenwood had conceived of the patent [sic, invention] and put it into workable shape before Seiko [sic, the date of the publications].Thus, the evidence Seiko originally offered remains unchallenged.Therefore, if the affidavits are insufficient, the PTO's original finding in favor of Seiko [sic, rejection] should be restored, and this Court must reverse the finding based on the affidavits.

711 F.Supp. at 31, 13 USPQ2d at 1246.

OPINION

A.The Memorandum and Order of the district court filed April 28, 1989 is, in essence, an inappropriate review of the reexamination proceeding of the PTO.The court held that "the judgment [sic, presumably alluding to the Commissioner's action in issuing the Certificate of Reexamination] of the Patent and Trademark Office(PTO) is reversed"² and stated that "if the [Rule 131] affidavits are insufficient, the PTO's original finding [sic, first rejection by the examiner] ... should be restored."711 F.Supp. at 31, 13 USPQ2d at 1245, 1246.The district court has misperceived the purpose and effect of reexamination, see35 U.S.C. Secs. 301-307, and has treated the reexamination as if it were part of Greenwood's suit against Seiko.SeeIn re Etter, 756 F.2d 852, 857, 225 USPQ 1, 5(Fed.Cir.1985)(in banc )("litigation and reexamination are distinct proceedings, with distinct parties, purposes, procedures, and outcomes.").Because the court's misperceptions caused it to disregard the presumption that all patents are valid, see35 U.S.C. Sec. 282(1982), its judgment must be vacated.

In an infringement suit before a district court, the invalidity of a patent under 35 U.S.C. Sec. 103 must be decided on the basis of prior art adduced in the proceeding before the court.The issue cannot be decided merely by accepting or rejecting the adequacy of the positions taken by the patentee in order to obtain a Certificate of Reexamination for the patent.Once issued by the PTO, a patent is presumed valid and the burden of proving otherwise rests solely on the challenger.Here, the court's error was likely caused by Seiko, with possible assistance from Greenwood.In its brief on appeal, and presumably in the district court, Seiko's principal argument for invalidating the '140 patent was that the reexamination certificate should not have issued because Greenwood's Rule 131 affidavit was insufficient to antedate the three magazine publications cited in the reexamination.Greenwood's brief is similarly directed in large part to the adequacy of his affidavit.After establishing to the satisfaction of the district court that its position on the affidavit was correct, Seiko then apparently persuaded the court that it could reinstate the examiner's initial rejection for obviousness, which had been grounded in part on the three publications.The district court followed this approach and held the patent invalid under 35 U.S.C. Sec. 103 based on the initial action of the examiner.As a result, the court did not analyze the publications, in conjunction with the other prior art references relied on by Seiko, in the manner required by the Supreme Court, and decisions of this court, to determine whether they would have rendered the invention obvious under section 103.Graham v. John Deere Co., 383 U.S. 1, 86 S.Ct. 684, 15 L.Ed.2d 545, 148 USPQ 459(1966);see, e.g., Allen Archery v. Browning Mfg. Co.,...