North American Oil Co. v. Star Brite Distributing
| Decision Date | 30 March 2001 |
| Docket Number | No. 1:98-CV-1589.,1:98-CV-1589. |
| Citation | 148 F.Supp.2d 1351 |
| Parties | NORTH AMERICAN OIL COMPANY, INC., Plaintiff, v. STAR BRITE DISTRIBUTING, INC., Defendant. |
| Court | U.S. District Court — Northern District of Georgia |
William Arthur Capp, Steven David Kerr, Michael Anthony Cicero, Womble, Carlyle, Sandridge & Rice, Atlanta, GA, for plaintiff.
Alan H. Bernstein phv, Caesar, Rivise, Bernstein, Cohen & Pokotilow, Philadelphia, PA, Stephen Robert Risley, Thomas, Kayden, Horstemeyer & Risley, Atlanta, GA, Leonard K. Samuels, phv, Jeffrey S. Wertman, phv, Berger, Davis & Singerman, Fort Lauderdale, FL, for defendants.
Before the Court for consideration are North American Oil Company, Inc.'s ("North American") Motion for Order Requiring Production of Dornau Transcript [0-0], North American's Motion for Partial Summary Judgment [262-1] and Star Brite Distributing, Inc.'s ("Star Brite") Motion for Attorney's Fees for September 13, 2000 motion to strike [333-1]. After reviewing the record and considering the arguments of the parties, the Court enters the following Order.
North American brings this action primarily seeking either a declaration that Star Brite's patent for a liquid electrical tape formulation is invalid or unenforceable or a declaration that North American's product does not infringe Star Brite's patent. Star Brite filed the patent application on April 10, 1991. The patented formulation forms "a durable vinyl coating or film on wires, junctions and objects." United States Patent 5,250,598 (issued Oct. 5, 1993) ("the '598 patent"). Star Brite's liquid electrical tape includes the following components: (1) a vinyl chloride copolymer consisting of vinyl chloride and vinyl acetate, (2) a vinyl toluene/acrylate copolymer thickener or thixotropic agent, (3) a plasticizer for flexibility, (4) an epoxy stabilizing agent to prevent acid release at elevated temperatures, and (5) at least one solvent. Id. The patent also claims that the "principal object" of the invention is to provide a product with a good shelf life. Id.
North American moves for partial summary judgment on the issues of invalidity and unenforceability of the '598 patent. North American offers evidence to show that Star Brite's invention was anticipated or obvious, that Star Brite misjoined inventors, and that Star Brite committed fraud on the patent office by failing to disclose relevant prior art to the United States Patent & Trademark Office ("PTO"). Pursuant to the Court's January 29, 2001 Order, the following evidence previously submitted will not be considered in ruling on this motion: Dr. Rubner's expert report, Harry Manbeck's expert report, Second Supplement to the Initial Expert Report of Patrick H. Woods, Ph.D., Certificate of Counsel Relating to Chain of Custody of Certain Physical Exhibits; Second Supplemental Affidavit of Cal Yudin, Affidavit of B.G. Dhake, Supplemental Affidavit of Frank Glinski, and Affidavit of Mark Alois Quade.
Rule 56(c) of the FEDERAL RULES OF CIVIL PROCEDURE provides that a district court shall grant summary judgment if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is (1) no genuine issue as to any material fact and that (2) the moving party is entitled to judgment as a matter of law." The moving party bears the burden of showing the absence of a genuine issue as to any material fact. The applicable substantive law identifies which facts are material, and a fact is not material if a dispute over that fact will not affect the outcome of the suit under the governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510 (1986). An issue is genuine when the evidence is such that a reasonable jury could return a verdict for the nonmovant. Id. at 249-50, 106 S.Ct. at 2510-11. The Court must view materials submitted in favor of the motion in the light most favorable to the non-moving party. Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970); Isenbergh v. Knight-Ridder Newspaper Sales, Inc., 97 F.3d 436 (11th Cir. 1996); Clark v. Coats & Clark, Inc., 929 F.2d 604 (11th Cir.1991).
For issues on which the movant would bear the burden of proof at trial, that party must show affirmatively the absence of a genuine issue of material fact: it must support its motion with credible evidence... that would entitle it to a directed verdict if not controverted at trial. In other words, the moving party must show that, on all essential elements of its case on which it bears the burden of proof at trial, no reasonable jury could find for the non-moving party. If the moving party makes such an affirmative showing, it is entitled to summary judgment unless the non-moving party, in response, come[s] forward with significant, probative evidence demonstrating the existence of a triable issue of fact.
Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115 (11th Cir.1993) quoting U.S. v. Four Parcels of Real Property, 941 F.2d 1428, 1438 (11th Cir.1991) (en banc). If the movant fails to satisfy this heavy initial burden, then the motion must be denied and the court need not consider what showing the non-movant has made. Coats & Clark, 929 F.2d at 608.
Once the movant has satisfied this burden, the non-moving party must show the presence of a disputed material fact. The non-moving party cannot rely on her pleadings, but must file a response which includes other evidence showing that there is a genuine issue for trial. FED. R. CIV. P. 56(e); Combs v. Plantation Patterns, 106 F.3d 1519 (11th Cir.1997); Isenbergh, 97 F.3d at 436. Mere conclusory allegations and assertions are insufficient to create a disputed issue of material fact. Earley v. Champion Int'l Corp., 907 F.2d 1077, 1081 (11th Cir.1990); Pelli v. Stone Savannah River Pulp and Paper Corp., 878 F.Supp. 1559, 1565 (S.D.Ga.1995); Mack v. W.R. Grace Co., 578 F.Supp. 626, 630 (N.D.Ga. 1983);. A genuine issue of material fact only exists if there is sufficient evidence favoring the non-moving party for a reasonable jury to return a verdict in its favor. Anderson, 477 U.S. at 249-51, 106 S.Ct. 2505; Thornton v. E.I. Du Pont De Nemours and Co., 22 F.3d 284, 288 (11th Cir.1994). One district court noted, "Even if the moving party comes forward with an abundance of evidence supporting its theory of the case, the nonmoving party may nevertheless defeat the motion by countering with evidence of his own, which, if credited by the fact-finder, would entitle the nonmoving party to a verdict in his favor." Ziolkowski v. Caterpillar, Inc., 800 F.Supp. 767, 778 (E.D.Wis.1992).
In this action, North American seeks a declaratory judgment as to the invalidity and/or unenforceability of Star Brite's patent. A patent holder may normally bring an infringement action against an alleged infringer, seeking injunctive relief and damages for patent infringement. In that situation, the alleged infringer might raise the affirmative defenses of invalidity and unenforceability to avoid liability for infringement. Here, the tables are turned. North American wishes to have the patent at issue declared invalid or unenforceable, and Star Brite counterclaims for infringement. However, the burdens of proof are allocated just as they would be in an infringement action-Star Brite bears the burden of proof on infringement and North American bears the burden of proof on its affirmative defenses of invalidity and unenforceability.
A patent is presumed valid. 35 U.S.C. § 282. The one challenging validity must show by clear and convincing evidence that the patent is invalid. Hybritech, Inc. v. Monoclonal Antibodies, Inc., 802 F.2d 1367, 1375 (Fed.Cir.1986), cert. denied, 480 U.S. 947, 107 S.Ct. 1606, 94 L.Ed.2d 792 (1987). All evidence bearing on the invalidity issue is to be considered whether it was presented to patent examiner or not. Structural Rubber Prods. v. Park Rubber, 749 F.2d 707, 714 (Fed.Cir.1984). Introducing prior art not before the examiner facilitates meeting the burden of proof on invalidity. Hybritech, 802 F.2d at 1375.
In an infringement action, the presumption of validity would allow Star Brite to avoid offering evidence to prove validity, novelty, and non-obviousness as a part of its prima facie case of infringement. However, the presumption would not protect the patent from affirmative defenses to infringement that North American might raise, including invalidity for lack of novelty or obviousness, if those affirmative defenses were proven by clear and convincing evidence. See Jervis B. Webb Co. v. Southern Sys., Inc., 742 F.2d 1388, 1392 n. 4 (Fed.Cir.1984) (). Therefore, if North American can prove its defenses to infringement by clear and convincing evidence, and Star Brite does not dispute this proof with its own evidence, then North American is entitled to summary judgment in spite of the presumption of validity. In other words, the presumption is rebuttable and can be overcome by undisputed clear and convincing evidence. Stratoflex, Inc. v. Aeroquip Corp., 713 F.2d 1530 (Fed.Cir.1983) ().
In the instant case, North American seeks to rebut the presumption of patent validity, arguing that there are three bases for declaring United States Patent 5,250,-598 ("the '598 patent") invalid: (1) anticipation or lack of novelty, (2) obviousness, and (3) misjoinder of inventors. These three legal theories will be considered in turn.
An invention is not entitled to a patent if it "was known or used by others in this country or patented or...
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