Meridian Mfg., Inc. v. C&B Mfg., Inc.

• Decision Date: 05 October 2018
• Docket Number: No. C15-4238-LTS,C15-4238-LTS
• Citation: 340 F.Supp.3d 808
• Parties: MERIDIAN MANUFACTURING, INC., Plaintiff, v. C & B MANUFACTURING, INC., d/b/a HitchDoc, Defendant.
• Court: U.S. District Court — Northern District of Iowa

340 F.Supp.3d 808

MERIDIAN MANUFACTURING, INC., Plaintiff,

v.C & B MANUFACTURING, INC., d/b/a HitchDoc, Defendant.

No. C15-4238-LTS

United States District Court, N.D. Iowa, Western Division.

Signed October 5, 2018

Christine Lebron-Dykeman, Jonathan Lee Kennedy, R. Scott Johnson, Nicholas Krob, McKee Voorhees & Sease PLC, Des Moines, IA, for Plaintiff.

Jay Elliott Denne, Munger Reinschmidt & Denne, Sioux City, IA, Sander J. Morehead, Tim R. Shattuck, Woods Fuller Schutlz & Smith PC, Sioux Falls, SD, for Defendant.

MEMORANDUM OPINION AND ORDER ON MOTIONS FOR SUMMARY JUDGMENT

Leonard T. Strand, Chief Judge

I. INTRODUCTION

This patent case is before me on: (1) a motion (Doc. No. 90) for summary judgment on invalidity filed by defendant C & B Manufacturing, Inc. (HitchDoc), (2) a motion (Doc. No. 92) for summary judgment as to HitchDoc's affirmative defenses, filed by plaintiff Meridian Manufacturing Inc. (Meridian) and (3) a motion (Doc. No. 88) for summary judgment to limit damages filed by HitchDoc. Meridian filed resistances (Doc. Nos. 101, 107) to both of HitchDoc's motions and HitchDoc filed replies (Doc. Nos. 108, 109). HitchDoc filed a resistance (Doc. No. 99) to Meridian's motion for summary judgment but Meridian did not file a reply.¹

Meridian holds United States Patent No. 6,964,551 B1 ('551 Patent), which involves component claims for an agricultural trailer. In its complaint (Doc. No. 2), Meridian alleges that HitchDoc is a competitor that makes agricultural equipment, including trailers that infringe on the '551 Patent. On June 9, 2017, after conducting a Markman hearing, I filed an order (Doc. No. 52) in which I construed certain claims contained in the '551 patent (the Markman order). The parties then filed motions (Doc. Nos. 55, 56) for summary judgment on infringement. On October 27, 2017, I entered an order (Doc. No. 75) granting Meridian's motion for summary judgment and finding, as a matter of law, that HitchDoc's trailer infringes on claims 1, 2, 3, 9, 10 and 11 of the '551 Patent. The parties then filed the present motions addressing invalidity and damages.

Trial is scheduled to begin on November 5, 2018. The motions are fully briefed and ready for decision. I find that oral argument is not necessary.

II. RELEVANT FACTS

The following facts are undisputed, except where noted otherwise:

A. The '551 Patent

The '551 Patent, entitled "Trailer for Transporting Bulk Seed Boxes," is an invention designed to help farmers transport large seed bags or boxes to planters in the fields. The following embodiment is depicted in Figure 1:

Meridian filed its complaint of patent infringement on November 23, 2015. Of the 19 claims contained in the '551 patent, Meridian alleged that HitchDoc's product, the Travis Seed Cart, infringes claims 1, 2, 3, 9, 10 and 11. These claims are:

1. An improved trailer for transporting a bulk seed box, the box having first and second sidewalls, a bottom, a top, and a flange extending along the sidewalls adjacent the bottom of the box, the trailer comprising:

a wheeled bed for supporting a bulk seed box, the bed having a perimeter edge;

a hopper extending below the bed for receiving seed from the bulk seed box;

a conveyor operatively connected to the hopper for unloading seed from the hopper; and

the bed having guide plates inclining upwardly and outwardly from the perimeter edge of the bed to facilitate centering of the box on the bed.

2. The improved trailer of claim 1 wherein the bed has four corners and the guide plates are located at the corners of the bed.

3. The improved trailer of claim 1 further comprising lock bars on the bed to overlappingly engage the flange of the seed box to secure the seed box to the bed.

9. The improved trailer of claim 1 wherein the conveyor is an auger including a first inner section and a second outer section pivotally attached to the first section for movement between transport and discharge positions, and including a gas cylinder to facilitate movement of the second section between the transport and discharge positions.

10. The improved trailer of claim 1 wherein each guide plate extends outwardly at an obtuse angle from the bed.

11. The improved trailer of claim 1 wherein the guide plates define an enlarged box entrance sloping downwardly and inwardly toward the bed so that the box will automatically center on the bed when loaded onto the bed.

Doc. No. 31 at 7–8.

Claim 1 is the only independent claim at issue. The bulk of the parties' arguments focus on the guide plates "inclining upwardly and outwardly from the perimeter edge of the bed." An example of a Meridian guide plate is circled in Figure 2:

B. History of the '551 Patent

Garry Friesen, the inventor of the '551 Patent, has no engineering degree and had never observed a seed tender before he worked on the project that resulted in the '551 Patent. He believed there was an issue with loading and positioning seed boxes on a seed cart. Friesen initially used perpendicular guide plates and straps to secure the boxes. To improve the design, he decided to provide a bigger target for the forklift operator to hit and allow the seed box to slide into position. He then switched to plates that extend upwardly and outwardly from the bed of the cart and exchanged the straps for lock bars.

Friesen filed his application for the '551 Patent on December 12, 2001. At that time, Claim 1 described the guide plates as "extending upwardly and outwardly to facilitate centering the box on the bed." Doc. No. 107-1 at 4. The patent examiner rejected the application because of Patent No. 6,092,974 (the Roth Patent). The Roth Patent had guide plates around the perimeter extending straight upwardly, as depicted in Figure 3.

To overcome the Roth patent, Friesen amended Claim 1 to state, in relevant part, that the guide plates incline upwardly and outwardly from the bed. The patent examiner rejected this second attempt because of the Roth patent and Patent No. 1,675,701 (the Fitch patent). The Fitch Patent is depicted in Figure 4:

While difficult to see in this depiction, the interior surfaces of the plates incline upwardly and outwardly from the bed. The Fitch patent is not directed toward an agriculture-specific device, but to trucks used to transport general containers.

Friesen then amended Claim 1 to its present form, stating the guide plates inclined "upwardly and outwardly from the perimeter edge of the bed. " (emphasis added) The patent examiner rejected Friesen's application for a third time. On appeal, however, the Board of Patent Appeals and Interferences (the Board) overturned the examiner's rejection, noting that the Fitch brackets had inclined walls that were within the perimeter edge of the bed. The '551 Patent issued on November 15, 2005. Meridian is the current owner.

C. Infringement

In late 2001 or early 2002, before the '551 Patent issued, Friesen began selling his seed tenders with the patented features and showing them at farm shows under the "Seed Titan" name. Wyman Travis, creator of the Travis Seed Cart now sold by HitchDoc, often attended the same farm shows. He designed the Travis Seed Cart in late 2004 or early 2005. The guide plates of the Travis Seed Cart are depicted in Figure 5.

HitchDoc acquired the right to sell the Travis Seed Cart in 2009. HitchDoc has known about the '551 Patent since at least July 1, 2011, when it submitted the '551 Patent to the United States Patent and Trademark Office (USPTO) as part of an information disclosure statement.

Between November 20, 2005, and September 24, 2008, Meridian purchased 1,000 patent decals for its tenders.² Between 2005 and 2009, Meridian sold 2,283 box seed tenders. The parties dispute how many of the tenders sold had patent decals. On September 17, 2015, Meridian gave HitchDoc actual notice of infringement by sending HitchDoc a cease and desist letter.³ HitchDoc continued selling the Travis Seed Cart after receiving the cease and desist letter and did not seek counsel's opinion regarding infringement of the '551 Patent before Meridian filed its complaint. At no time has Meridian affirmatively consented to HitchDoc's infringement.

Meridian filed its complaint for patent infringement on November 23, 2015. At the Markman stage, I found that "perimeter edge of the bed" meant the planar boundary around the bed, rather than the physical point where the side and top surfaces of the bed intersect. With that understanding, I found that HitchDoc's seed tenders literally infringed on Claim 1 (and by extension claims 2, 9, 10 and 11) of the '551 Patent. Doc. No. 75 at 16. I also found that Claim 3, which describes lock bars that "overlappingly engage the flange of the seed box," was infringed. Id. at 18–19. After my ruling that the Travis Seed Cart infringed the '551 patent, HitchDoc started a redesign of its seed cart.⁴

Additional facts will be discussed below as necessary.

III. SUMMARY JUDGMENT STANDARDS

Any party may move for summary judgment regarding all or any part of the claims asserted in a case. Fed. R. Civ. P. 56(a). Summary judgment is appropriate when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to a judgment as a matter of law." Celotex Corp. v. Catrett , 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).

A material fact is one that " ‘might affect the outcome of the suit under the governing law.’ " Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Thus, "the substantive law will identify which facts are material." Id. Facts that are "critical" under the substantive law are material, while facts that are "irrelevant or unnecessary" are not. Id.

An issue of material fact is genuine if it has a real basis in the record, Hartnagel v. Norman , 953 F.2d 394, 395 (8th Cir. 1992) (citing Matsushita Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 586-87, 106 S.Ct....