Meyers v. Brooks Shoe Inc.

• Decision Date: 31 August 1990
• Docket Number: No. 90-1081,90-1081
• Citation: 912 F.2d 1459,16 USPQ2d 1055
• Parties: Stuart R. MEYERS, Plaintiff-Appellant, v. BROOKS SHOE INC. and Wolverine World Wide, Inc., Defendants-Appellees.
• Court: U.S. Court of Appeals — Federal Circuit

Page 1459

912 F.2d 1459

16 U.S.P.Q.2d 1055

Stuart R. MEYERS, Plaintiff-Appellant, v. BROOKS SHOE INC. and Wolverine World Wide, Inc., Defendants-Appellees.

No. 90-1081.

United States Court of Appeals, Federal Circuit.

Aug. 31, 1990.

Robert C. Faber, Ostrolenk, Faber, Gerb & Soffen, New York City, argued for plaintiff-appellant. With him on the brief were Samuel H. Weiner, Steven I. Weisburd and William O. Gray, III.

Terence J. Linn, Price, Heneveld, Cooper, Dewitt & Litton, Grand Rapids, Mich., argued for defendants-appellees. With him on the brief was Richard C. Cooper.

Before ARCHER and MAYER, Circuit Judges, and WEIGEL, Senior District Judge. ^*

OPINION

MAYER, Circuit Judge.

Stuart R. Meyers appeals an order of the United States District Court for the Southern District of New York, 721 F.Supp. 588 (1989), granting summary judgment for Brooks Shoe Inc. and Wolverine World Wide, Inc. on their defenses of laches and equitable estoppel to Meyers' suit for patent infringement. We reverse and remand.

Background

Meyers is a practicing podiatrist interested in the biomechanics of running. He has independently developed therapeutic sole structures for running shoes and obtained patents for his inventions, including U.S. Patents 4,297,797, 4,445,283 and 4,627,177, issued November 3, 1981, May 1, 1984 and December 9, 1986, respectively.

Beginning in 1983, Meyers contacted various shoe manufacturers, including Brooks Shoe Inc. and Wolverine World Wide, Inc. (Brooks), ¹ in an effort to commercialize his inventions. In a letter to Brooks dated November 9, 1983, referring to earlier telephone conversations with Brooks' general counsel, Meyers offered to negotiate licenses under his '797 patent, corresponding Canadian, Japanese and European patents, application no. 196,020 (which was a divisional of the '797 patent and issued as Meyers' '283 patent), and two continuation-in-part applications. Brooks' general counsel responded in a letter dated December 7, 1983 that Brooks was not interested in a license.

On November 2, 1987, Meyers filed an infringement suit based on his '797, '283 and '177 patents against various athletic shoe retailers, alleging that Brooks' CHARIOT running shoe infringed his '797 and '283 patents. The defendant retailers notified Brooks of the suit, and Brooks' outside counsel defended them.

Meyers filed the present suit against Brooks on June 2, 1988, alleging that it made, used and/or sold shoes that fell within the scope of each of the '797, '283 and '177 patents. The case was transferred to the Southern District of New York and consolidated with similar suits against two other shoe manufacturers pursuant to 28 U.S.C. Sec. 1407. On May 30, 1989, Brooks moved for summary judgment on the defenses of laches and equitable estoppel, and Meyers filed a cross-motion.

The district court granted Brooks' motion. The court wrote that Meyers first became aware of Brooks' alleged infringement in late 1982 or early 1983 and that Meyers contacted Brooks' general counsel by telephone in August 1983 and notified her of the alleged infringement. According to the court, between 1983 and 1987 Brooks expended a great deal of money and effort developing new shoes which included the allegedly infringing sole structure. The court rejected Meyers' contention that he could not have brought suit until the third patent issued and found that laches ran from late 1982 or early 1983 until 1988 when Meyers filed suit against Brooks, some five years. It held that Brooks had shown that Meyers had unreasonably and inexcusably delayed causing material prejudice, and that Meyers' silence following his "aggressive assertion" of infringement was so misleading as to amount to bad faith, resulting in equitable estoppel.

Discussion

The question before us is whether the district court erred in concluding that there is no genuine issue as to any material fact and that Brooks was entitled to judgment as a matter of law. Fed.R.Civ.Proc. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986); Jamesbury Corp. v. Litton Indus. Prods., Inc., 839 F.2d 1544, 1548, 5 USPQ2d 1779, 1782 (Fed.Cir.1988). The purpose of Rule 56 is to avoid an unnecessary trial, but it must be used carefully because an improper grant of summary judgment "may deny a party a chance to prove a worthy case." Lemelson v. TRW, Inc., 760 F.2d 1254, 1260, 225 USPQ 697, 700 (Fed.Cir.1983) (quoting D.L. Auld Co. v. Chroma Graphics Corp., 714 F.2d 1144, 1146, 219 USPQ 13, 15 (Fed.Cir.1983)). The district court cannot engage in fact-finding on a motion for summary judgment. Id. at 1260, 225 USPQ at 701. If there is a real dispute about a material fact or factual inference, summary judgment is inappropriate; the factual dispute should be reserved for trial. The moving party has the burden to demonstrate the absence of any genuine issue over all the material facts. Adickes v. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970). And where the moving party has the burden of proof on a claim or defense raised in a summary judgment motion, it must show that the undisputed facts establish every element of the claim or defense.

To establish laches, the defendant must show 1) unreasonable and inexcusable delay in filing suit and 2) material prejudice resulting from the delay. Jamesbury, 839 F.2d at 1551, 5 USPQ2d at 1785; Hottel Corp. v. Seaman Corp., 833 F.2d 1570, 1572, 4 USPQ2d 1939, 1940 (Fed.Cir.1987). Laches is presumed in patent infringement cases if the delay is longer than six years, but otherwise the defendant has the burden of proving both elements of the defense. Laches bars recovery of damages for any infringement occurring before suit was filed.

For the related defense of equitable estoppel, the defendant must show both elements of laches as well as 3) affirmative conduct by the patent owner inducing the belief that he had abandoned the claims against the alleged infringer and 4) detrimental reliance by the alleged infringer. Jamesbury, 839 F.2d at 1553, 5 USPQ2d at 1786; Hottel, 833 F.2d at 1573, 4 USPQ2d at 1941. Equitable estoppel bars all relief for patent infringement.

The district court should not have granted summary judgment on the laches defense because Brooks did not present undisputed facts showing that Meyers' delay in filing suit was unreasonable and that Brooks was prejudiced by the delay. Brooks was not entitled to judgment on its defense of equitable estoppel either, not only because it failed to show unreasonable delay and prejudice, but also because a mere verbal charge of infringement, if made, followed by silence was not sufficient affirmative conduct to induce a belief that Meyers had abandoned an infringement claim.

In determining laches, the court must consider when the patent owner knew or should have known of the defendant's alleged infringement. Jamesbury, 839 F.2d at 1552, 5 USPQ2d at 1785. But, like infringement, laches does not begin until the patent issues. Bott v. Four Star Corp., 807 F.2d 1567, 1575, 1 USPQ2d 1210, 1216 (Fed.Cir.1986). And where the plaintiff alleges infringement of more than one patent, laches must be determined separately for each. Id. at 1575, 1 USPQ2d at 1216.

We agree that Meyers did not raise a genuine issue of material fact about when he first believed Brooks' shoes infringed his '797 patent. He tells us in the brief that he did not have a patent attorney examine any of Brooks' products to determine whether they infringed until November of 1983, but he cites nothing in the record in support. Moreover, Meyers testified in his deposition that he was aware of Brooks' CHARIOT, the first of the allegedly infringing shoes, shortly after it hit the market, which was in September 1982, and that he then believed it incorporated his invention. We also do not agree with Meyers that filing suit against the retailers tolled the laches period. He did not give Brooks notice of the retailer litigation nor of his intent to enforce his patents against Brooks when it was concluded. That is necessary if delay is to be excused because of other litigation. Jamesbury, 839 F.2d at 1553, 5 USPQ2d at 1786; Hottel, 833 F.2d at 1573, 4 USPQ2d at 1940.

Nevertheless, we think the district court erred in basing its decision on a single laches period for all three patents, running from late 1982 or early 1983 to June of 1988. Meyers could not have filed suit on his second patent (the '283 patent) until after it issued in May 1984. Likewise, he could not have filed suit on his third patent (the '177 patent) until after it issued in December 1986. Therefore, the delay was at most 5 1/2 years for the '797 patent, but only 4 years for the '283 patent and 1 1/2 years for the '177 patent. Because each of these periods of delay was less than six years, Brooks had the burden to prove that each was unreasonable and that it was materially prejudiced. It did not adequately show undisputed facts supportive of either element.

It strikes us as reasonable for Meyers to have waited to sue on his first patent (the '797 patent) at least until he could sue on both the first and second patents at the same time. As the district court recognized, the '797 and '283 patents are related. The '283 is a divisional of the '797, and, even though the claims are different in scope, Meyers alleges that the same nine models of Brooks' shoes infringe both patents. When Meyers learned of Brooks' alleged infringement in late 1982, his second patent application was already pending, and by autumn 1983 he knew it would soon issue. Awaiting issuance of the second patent to sue on both at once conserved both the parties' and the courts' resources. It may be that there are times when a patentee must bring suit before the expected issuance of the second of two related patents, see, e.g., A.C. Aukerman Co. v. Miller Formless Co., 693 F.2d 697, 699 n. 4, 216 USPQ 863, 865 n. 4 (7th Cir.1982), but this is...