Jerabek, In re
| Decision Date | 24 April 1986 |
| Docket Number | 85-2009,Nos. 85-2008,s. 85-2008 |
| Parties | , 229 U.S.P.Q. 530 In re Robert D. JERABEK. Appeal |
| Court | U.S. Court of Appeals — Federal Circuit |
Edward M. O'Toole, Marshall, O'Toole, Gerstein, Murray & Bicknell, of Chicago, Ill., argued for appellant. With him on the brief was Carl E. Moore, Jr.
Henry W. Tarring, II, Associate Sol., U.S. Patent & Trademark Office, of Arlington, Va., argued for appellee. With him on the brief were Joseph F. Nakamura, Sol. and Fred E. McKelvey, Deputy Solicitor.
Herbert F. Schwartz, Fish & Neave, of New York City, argued for intervenor, Celanese Polymer Specialties Co. With him on the brief were David J. Lee, James F. Haley, Jr. and Ron E. Shulman.
Before FRIEDMAN, DAVIS and SMITH, Circuit Judges.
This is a consolidated appeal from two decisions of the United States Patent and Trademark Office (PTO) Board of Appeals (Board), sustaining the examiners' rejection of all claims in related reissue applications, Serial Nos. 198,291 (the '291 reissue application) and 198,526 (the '526 reissue application). All claims in the two applications were rejected as unpatentable under 35 U.S.C. Sec. 103 because of obviousness, and also as violative of the duty of disclosure, set forth in 37 C.F.R. Sec. 1.56(a), under 35 U.S.C. Secs. 131 and 132. Additionally, claim 11 of the '526 reissue application was rejected as anticipated under 35 U.S.C. Sec. 102. We affirm solely on the ground that all the claims of the reissue applications were properly rejected under 35 U.S.C. Secs. 131 and 132 because of a violation of the duty of disclosure through gross negligence in the prosecution of the applications resulting in the original patents.
Electrodeposition as a coating application method involves the deposition of a film forming material under the influence of an applied electrical potential, and has become of increasing commercial importance. Unlike conventional coating techniques, i.e., spraying and dipping, electrodeposition produces a commercially-useable film having such advantages as a uniform thickness and improved hardness, toughness, flexibility and solvent resistance. Other advantages of electrodeposited films include an excellent green (uncured) strength, due to its high solid content, and a better appearance and cure.
The present inventions relate to electrodeposition coating compositions having a cationic charge and to a method of electrodepositing those compositions. Generally, the '291 reissue application, which seeks reissue of U.S. Patent No. 4,031,050 (the '050 patent), 1 discloses an electrodeposition composition comprising an epoxy-amine adduct and a blocked or capped polyisocyanate curing agent. Claim 1, as originally filed, is representative:
1. A composition comprising:
A. a synthetic-hydroxyl-containing adduct which is the reaction product of a primary or secondary amine and a polyepoxide, said adduct being solubilized with acid to provide cationic groups in said adduct,
B. a blocked polyisocyanate stable at ordinary room temperature in the presence of said adduct and reactive with said adduct at elevated temperatures.
The '526 reissue application, which seeks reissue of U.S. Patent No. 3,984,299 (the '299 patent), 2 discloses a method of electrodepositing the composition disclosed in the '291 reissue application and to an article so electrocoated. Claims 1 and 11 are representative:
1. In a method of electrocoating an electrically-conductive surface serving as a cathode which comprises passing electric current between said cathode and an anode in contact with an aqueous electrodepositable composition, the improvement wherein said electrodepositable composition comprises:
A. a hydroxyl-containing adduct which is the reaction product of a primary or secondary amine and a polyepoxide, said adduct being solubilized with acid to provide cationic groups in said adduct,
B. a blocked organic polyisocyanate stable at room temperature in the presence of hydroxyl or amino groups but reactive with hydroxyl or amino groups at elevated temperatures.
11. An article electrocoated by the method of claim 1.
Both the '050 and the '299 patents were assigned to PPG Industries (PPG) and were prosecuted before the PTO by Mr. William J. Uhl, an attorney employed at PPG. In September 1978, PPG brought suit against the Celanese Polymer Specialties Company (CPSC), the intervenor in the present appeal, in the United States District Court for the Western District of Kentucky alleging infringement of the two patents. 3 During the initial stages of discovery, CPSC uncovered certain records from the Japanese Patent Office; these records revealed that in 1975 and 1976, PPG relied on Sattler, U.S. Patent No. 3,321,548 (the Sattler patent) 4 to successfully oppose a third party Japanese patent application which claimed subject matter similar to that claimed in the '050 and '299 patents. As a consequence of the Japanese records, CPSC moved for and was granted an extension of the discovery period. During further discovery, CPSC found other evidence which demonstrated that PPG knew of the Sattler patent during the time of the prosecution of the '050 and '299 patents.
On the eve of trial, PPG moved for a stay of all proceedings until it filed and completed prosecution of reissue applications '291 and '526 before the PTO. The district court granted PPG's motion and stayed further proceedings pending the outcome of the reissue proceedings.
PPG filed reissue applications '291 and '526 in the PTO on October 20, 1980. The applications were sent to the Office of the Assistant Commissioner for Patents for review on the issues of "fraud" and violation of the duty of disclosure. The Assistant Commissioner deferred consideration of these issues and sent the applications to the Examining Group for a decision on the patentability of the reissue claims in light of the Sattler patent as well as other references. In an initial office action, the examiner rejected all of the claims of the '291 reissue application as unpatentable under 35 U.S.C. Sec. 103 over the Sattler patent in combination with other references; claims 1, 4 and 5 were further rejected under 35 U.S.C. Sec. 102 over Sattler alone. PPG's response to the examiner's action was to amend independent claim 1 to overcome the Sec. 102 rejection. 5 Following entry of appellant's amendment, the examiner finally rejected all the claims of the '291 reissue application under 35 U.S.C. Sec. 103 over the Sattler patent in combination with other references.
All of the claims of the '526 reissue application were initially rejected under 35 U.S.C. Sec. 103 over the Sattler patent in combination with other references. Alternatively, claim 11 of the application was rejected under 35 U.S.C. Sec. 102 over Sattler alone. No amendments to the claims were made in appellant's response to the examiner's initial action. Maintaining his earlier rejections, the examiner finally rejected the reissue application.
Following the final rejection of both reissue applications, the applications were returned to the Assistant Commissioner for consideration of issues relating to fraud and misconduct. After nearly one year of examination, the Fraud Examiner found that Sattler was clearly material to the claims in the applications for both the '050 and '299 patents and that PPG's attorney was at least grossly negligent in failing to bring the Sattler patent to the attention of the examiner handling each application. Accordingly, the Fraud Examiner rejected both reissue applications under 35 U.S.C. Secs. 131 and 132 based on violation of the duty of disclosure as set forth in 37 C.F.R. Sec. 1.56(a) (1984). 6
On appeal to the Board, the Board unanimously affirmed the prior art rejections in both reissue applications. 7 Similarly, a unanimous Board affirmed the rejections based on "fraud" under sections 131 and 132 in both applications. PPG petitioned the Board for reconsideration of both decisions contending (1) that the Board erred in characterizing PPG's conduct during prosecution of the applications for the '299 and '050 patents as "fraud" and (2) that the Board improperly assessed the alleged commercial success of the claimed subject matter. On reconsideration of the '291 reissue application, the Board concluded that sufficient weight was given to the "secondary considerations" in the initial decision. With respect to the issue of fraud, the Board affirmed its initial determination but modified the language to be more in line with the judicially created doctrine of "inequitable conduct." The Board noted that it was "aware that the judicially created precedent in fraud in the [PTO] is broader than 'common law fraud'." Similarly, on reconsideration of the '526 reissue application, the Board upheld its initial decision.
On the appeal to this court, issues concerning the patentability of the reissue claims over prior art of record have been raised, in addition to the question of whether "inequitable conduct" occurred through violation of the duty of disclosure. Because our decision turns wholly on the question of "inequitable conduct" and that holding is sufficient to sustain the decision below, we do not find it necessary to pass on the remaining issues.
"Inequitable conduct" requires proof by clear and convincing evidence of a threshold of materiality of the nondisclosed information and of the prosecutor's intent. J.P. Stevens & Co. v. Lex Tex Ltd., 747 F.2d 1553, 1559, 223 USPQ 1089, 1094 (Fed.Cir.), cert. denied, --- U.S. ----, 106 S.Ct. 73, 88 L.Ed.2d 60 (1984). Materiality and intent are factual issues, American Hoist & Derrick Co. v. Sowa & Sons, 725 F.2d 1350, 1363, 220 USPQ 763, 773 (Fed.Cir.), cert. denied, --- U.S. ----, 105 S.Ct. 95, 83 L.Ed.2d 41 (1984), and we must affirm such...
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