Midwest Industries, Inc. v. Karavan Trailers, Inc.

• Decision Date: 05 May 1999
• Docket Number: No. 98-1435,98-1435
• Citation: 175 F.3d 1356,1999 WL 270387,50 USPQ2d 1672
• Parties: MIDWEST INDUSTRIES, INC., Plaintiff-Appellant, v. KARAVAN TRAILERS, INC., Defendant-Appellee.
• Court: U.S. Court of Appeals — Federal Circuit

Page 1356

175 F.3d 1356

50 U.S.P.Q.2d 1672

MIDWEST INDUSTRIES, INC., Plaintiff-Appellant, v. KARAVAN TRAILERS, INC., Defendant-Appellee.

No. 98-1435.

United States Court of Appeals, Federal Circuit.

May 5, 1999.

Thomas J. Oppold, Henderson & Sturm, Des Moines, Iowa, argued for plaintiff-appellant. With him on the brief were H. Robert Henderson, and Michael O. Sturm. Of counsel was Curtis A. Bell.

G. Brian Pingel, Pingel & Templer, P.C., West Des Moines, Iowa, argued for defendant-appellee. Of counsel on the brief was Don Cayen, Fond du Lac, Wisconsin.

Before SCHALL, Circuit Judge, SMITH, Senior Circuit Judge, and BRYSON, Circuit Judge.

MAYER, Chief Judge, RICH, Circuit Judge, SMITH, Senior Circuit Judge, NEWMAN, MICHEL, PLAGER, LOURIE, CLEVENGER, RADER, SCHALL, BRYSON, and GAJARSA, Circuit Judges, have joined Part II-A of this opinion.

BRYSON, Circuit Judge.

Midwest Industries, Inc., appeals from the district court's order granting summary judgment to Karavan Trailers, Inc., on Midwest's state and federal trademark claims. The district court dismissed Midwest's claims, holding that they are barred by federal patent law. We hold that we will apply Federal Circuit law in determining whether patent law conflicts with other federal statutes or preempts state law causes of action. In so holding, the court overrules, en banc, those decisions in which we have held that regional circuit law governs in resolving such issues. On the merits, we hold that the record does not support the district court's order of summary judgment foreclosing Midwest from asserting its nonpatent claims. We therefore reverse the partial summary judgment in Karavan's favor and remand the case for further proceedings.

I

Midwest and Karavan manufacture and sell trailers for hauling watercraft behind automobiles. As is typically true of watercraft trailers, a winch mounted on a winch post at the front of each trailer serves to draw the watercraft onto the trailer and secure it in the correct position for traveling.

Midwest brought suit against Karavan in the United States District Court for the Southern District of Iowa, contending that Karavan's use of curved winch posts in certain of its watercraft trailers infringed two Midwest design patents and violated Midwest's rights under federal and state trademark law. In the nonpatent counts, Midwest alleged that Karavan committed trade dress infringement by copying its curved winch post design, in violation of section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), and the Iowa trademark statute, Iowa Code § 548. Midwest also alleged that Karavan's conduct violated Midwest's rights under the Iowa common law of trademarks.

Midwest is the exclusive licensee of U.S. Patent No. 5,518,261 (the '261 patent), which discloses a curved winch post as part of a trailer. In claim 10, one of the dependent claims, the '261 patent recites as a limitation, a winch post that "curve[s] forwardly and upwardly." Midwest has not alleged that any of Karavan's trailers infringe the '261 patent.

In the district court, Karavan filed a motion under Fed.R.Civ.P. 12(b)(6) to dismiss Midwest's nonpatent claims. Karavan argued that the nonpatent claims failed to state a claim on which relief could be granted because the '261 patent discloses and claims a curved winch post, and that it would improperly extend Midwest's patent rights to provide additional state and federal protection for the curved winch post design. The district court granted the motion, citing as its principal authority the Tenth Circuit's decision in Vornado Air Circulation Systems, Inc. v. Duracraft Corp., 58 F.3d 1498, 35 U.S.P.Q.2d 1332 (10th Cir.1995).

In the Vornado case, the Tenth Circuit refused to accord trade dress protection under section 43(a) of the Lanham Act to a fan having a grill with spiral vanes. The court based its ruling on the fact that the plaintiff held a utility patent that claimed a fan with multiple features, including a spiral grill. To offer trade dress protection to a product configuration that embodies "significant features of patented products," the court said, would interfere with "the public's ability to practice patented inventions after the patents have expired." Id. at 1508, 58 F.3d 1498, 35 U.S.P.Q.2d at 1340. Accordingly, the court held that a product configuration may not be accorded protection under the Lanham Act when the configuration is a "described, significant inventive component" of an issued utility patent. Id. at 1510, 35 U.S.P.Q.2d at 1342.

The district court did not address the question whether the curved winch post is "functional," as that term is used in trademark law. Instead, the court concluded that because the curved winch post is disclosed in the '261 patent and claimed in one of the dependent claims of that patent, it is "a significant inventive aspect" of the patent. For that reason, the district court concluded that Midwest was not entitled to Lanham Act protection for its trade dress. The court then concluded that Midwest's state law claims conflicted with patent policy for the same reasons. The court therefore held that those claims were preempted by federal patent law and had to be dismissed.

On Midwest's motion for reconsideration, the court vacated its order of dismissal. The court held that because Karavan's dismissal motion relied on material outside the pleadings, dismissal was inappropriate. The court, however, exercised its authority to convert Karavan's motion into a motion for summary judgment and granted summary judgment on the same grounds on which it had based its dismissal order. The court then entered final judgment on the nonpatent counts pursuant to Fed.R.Civ.P. 54(b), and Midwest took this appeal.

II

A

In Cable Electric Products, Inc. v. Genmark, Inc., 770 F.2d 1015, 1029, 1033, 226 U.S.P.Q. 881, 890, 892-93 (Fed.Cir.1985), we held that when called upon to determine whether patent law preempts particular state law causes of action or conflicts with rights created by other federal laws, we would apply the law of the circuit from which the case comes to us. We reiterated that holding in subsequent cases involving claims that patent law preempted particular state law claims. See Interpart Corp. v. Italia, 777 F.2d 678, 684, 228 U.S.P.Q. 124, 128 (Fed.Cir.1985); Hunter Douglas, Inc. v. Harmonic Design, Inc., 153 F.3d 1318, 1333, 47 U.S.P.Q.2d 1769, 1780 (Fed.Cir.1998), cert. denied, ---- U.S. ----, 119 S.Ct. 1037, 143 L.Ed.2d 45 (1999). Our consideration of this case, however, has led us to conclude that we should abandon our practice of applying regional circuit law in resolving questions involving the relationship between patent law and other federal and state law rights. Henceforth, we will apply our own law to such questions. To the extent that Cable Electric Products, Inc. v. Genmark, Inc., Interpart Corp. v. Italia, and Hunter Douglas, Inc. v. Harmonic Design, Inc., hold that we are required to apply regional circuit law to conflicts between patent law and other legal rights, we therefore overrule those decisions. ^*

In reviewing district court judgments in patent cases, we apply our own law with respect to patent law issues, but with respect to nonpatent issues we generally apply the law of the circuit in which the district court sits. See Atari, Inc. v. JS & A Group, Inc., 747 F.2d 1422, 1440, 223 U.S.P.Q. 1074, 1087 (Fed.Cir.1984) (in banc). We apply Federal Circuit law to patent issues in order to serve one of the principal purposes for the creation of this court: to promote uniformity in the law with regard to subject matter within our exclusive appellate jurisdiction. See S.Rep. No. 97-275, at 5 (1981), reprinted in 1982 U.S.C.C.A.N. 11, 15. When we apply regional circuit law to nonpatent issues, we do so in order to avoid the risk that district courts and litigants will be forced to select from two competing lines of authority based on which circuit may have jurisdiction over an appeal that may ultimately be taken, and to minimize the incentive for forum-shopping by parties who are in a position to determine, by their selection of claims, the court to which an appeal will go. See Atari, 747 F.2d at 1439, 223 U.S.P.Q. at 1087.

Distinguishing between "patent issues" and "nonpatent issues" has clarified the choice of law question for most purposes, but in some instances it has not been obvious whether a particular issue should be characterized as a "patent" issue or not. We have held that a procedural issue that is not itself a substantive patent law issue is nonetheless governed by Federal Circuit law if the issue "pertain[s] to patent law," Panduit Corp. v. All States Plastic Mfg. Co., 744 F.2d 1564, 1574-75, 223 U.S.P.Q. 465, 471 (Fed.Cir.1984), if it "bears an essential relationship to matters committed to our exclusive control by statute," Biodex Corp. v. Loredan Biomedical, Inc., 946 F.2d 850, 858-59, 20 U.S.P.Q.2d 1252, 1259 (Fed.Cir.1991), or if it "clearly implicates the jurisprudential responsibilities of this court in a field within its exclusive jurisdiction," Gardco Mfg., Inc. v. Herst Lighting Co., 820 F.2d 1209, 1212, 2 U.S.P.Q.2d 2015, 2018 (Fed.Cir.1987).

Applying those standards, we have held that Federal Circuit law applies to questions such as whether the district court has personal jurisdiction over the defendant in a patent suit, see Beverly Hills Fan Co. v. Royal Sovereign Corp., 21 F.3d 1558, 1564, 30 U.S.P.Q.2d 1001, 1006 (Fed.Cir.1994); whether the plaintiff has established its right to a preliminary injunction in a patent case, see Hybritech Inc. v. Abbott Lab., 849 F.2d 1446, 1451 n. 12, 7 U.S.P.Q.2d 1191, 1195 n. 12 (Fed.Cir.1988); whether there is a sufficient controversy between the parties to permit an accused infringer to bring an action seeking a declaratory judgment of patent noninfringement or invalidity, see Goodyear Tire & Rubber Co. v. Releasomers, Inc., 824 F.2d 953, 954-55 n. 3, 3 U.S.P.Q.2d 1310, 1311 n. 3 (Fed...