Northlake Marketing & Supply, Inc. v. Glaverbel, S.A., 92 C 2732.

• Decision Date: 13 November 1997
• Docket Number: No. 92 C 2732.,92 C 2732.
• Court: U.S. District Court — Northern District of Illinois
• Parties: NORTHLAKE MARKETING & SUPPLY, INC., et al., Plaintiffs, v. GLAVERBEL, S.A., et al., Defendants.

986 F.Supp. 471

NORTHLAKE MARKETING & SUPPLY, INC., et al., Plaintiffs, v. GLAVERBEL, S.A., et al., Defendants.

No. 92 C 2732.

United States District Court, N.D. Illinois, Eastern Division.

November 13, 1997.

Supplemental Opinion December 19, 1997.

John C. Brezina, Brezina & Ehrlich, Oak Brook, IL, Anthony S. DiVincenzo, Campbell & DiVincenzo, Chicago, IL, for plaintiff.

Jerold I. Schneider, Dorsey & Whitney, L.L.P., Washington, DC, for defendant.

MEMORANDUM OPINION AND ORDER

SHADUR, Senior District Judge.

This patent infringement battle between Northlake Marketing & Supply, Inc. ("Northlake") and its principals James Hamilton ("Hamilton") and Samuel May ("May") on the one hand and Glaverbel, S.A. ("Glaverbel") and Fosbel, Inc. ("Fosbel") on the other hand¹ has raged over many years, a number of courts and two continents. With this action having resulted in March of this year in a determination in this Court's "Opinion" (958 F.Supp. 373 (N.D.Ill.1997))² that Northlake's ceramic welding powder and process infringed the Glaverbel patents in suit (referred to here, as in the Opinion and other earlier opinions, as the "'468 Patent" and "'084 Patent"), this Court then conducted a May hearing (the "Hearing") into the question of patent validity. It is Northlake's contention that claims in both Patents (without, however, precisely specifying which claim or claims) are invalid on grounds of anticipation (35 U.S.C. § 102(a), "Section 102(a)") and obviousness (35 U.S.C. § 103, "Section 103").

Because Northlake and its principals are the attackers of the two patents in a declaratory judgment action, and because the presumptive validity of the patents under 35 U.S.C. § 282 places the burden of proving invalidity by clear and convincing evidence on such attackers (Trans-World Mfg. Corp. v. Al Nyman & Sons, Inc., 750 F.2d 1552, 1559-60 (Fed.Cir.1984)), Northlake put in its proof at the inception of the Hearing. Glaverbel-Fosbel then filed a Fed.R.Civ.P. ("Rule") 52(c) motion for a judgment as a matter of law, and some related motions as well, and the parties have since submitted their respective proposed findings of fact ("Findings") and conclusions of law ("Conclusions") to assist this Court in complying with Rule 52(c) and that Rule's incorporation of Rule 52(a).

This Court has regrettably been compelled to turn its efforts elsewhere for an extended period of time since receiving those submissions, thus delaying its ability to address the matters at issue here. But as it turns out, this Court's delayed return to the case has permitted a better perspective and, importantly, a simpler one. Instead of having to pick its way through the extended minutiae of the parties' submissions, this Court finds it possible to issue this memorandum opinion and order in that more straightforward and simplified light—at the end of which opinion this Court inquires of the litigants whether anything more is needed.

As one adjunct to the Glaverbel-Fosbel submissions, they have moved that the opinion evidence of Northlake's "expert" witness Professor Philip Nash ("Nash") be stricken in principal part because he lacks expertise in ceramic welding, though he may well be qualified—even eminently qualified—to opine in other areas in which he really qualifies as an expert (for another example of such a shortcoming, see Wintz v. Northrop Corp., 110 F.3d 508, 512-14 (7th Cir.1997)). And relatedly, Glaverbel-Fosbel seek to strike Northlake's Ex. 23-2 generated by Nash. Both aspects of that Glaverbel-Fosbel motion are quite persuasive, for Nash's testimony and the challenged exhibit certainly appear to present prototypical examples that call for rejection under the principles of Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993), as those principles extend to all types of testimony that come within the categories set out in Fed.R.Evid. ("Evid R.") 702 (our Court of Appeals has confirmed on a number of occasions that a Daubert-type analysis, perhaps with appropriate modifications, applies to all proposed expert testimony rather than its being confined to the hard sciences— see, e.g., Tyus v. Urban Search Management, 102 F.3d 256, 263 (7th Cir.1996), Sheehan v. Daily Racing Form, Inc., 104 F.3d 940, 942 (7th Cir.1997) and cases cited in both those decisions).³ But as the ensuing discussion reflects, Glaverbel-Fosbel prevail without any need for the formal striking of the Nash testimony and Northlake Ex. 23-2: Even when those things are considered "for what they are worth," Northlake has not carried its burden.

To turn to the principal issues at hand, Northlake's counsel had been extraordinarily elusive both before and during the Hearing in identifying precisely what they claim calls for the determinations of anticipation and obviousness for which they argue. This Court has therefore welcomed their proposed Findings and Conclusions as a means to pin down their real contentions. Although that document puts the cart before the horse by placing the proposed Conclusions first, when Northlake does gets around to the claimed factual assertions on which it relies, it speaks of three things as supporting its position:

1. Northlake's own ceramic welding for a single demonstration in 1984, and then its other asserted welding between 1984 and 1986, are said to anticipate the patents now in suit (proposed Findings 17-19 and 34).

2. Example VIII of one of Glaverbel's own earlier patents issued in December 1984 (United States Patent No. 4,489,022 ("'022 Patent")) is also said to constitute prior art anticipating the patents now in suit (proposed Findings 28-33).

3. When the '022 Patent is looked at in view of an even earlier 1972 patent of Glaverbel's (United States Patent No. 3,684,560 ("'560 Patent")) and a 1981 article published in the Journal of the Canadian Ceramic Society entitled "Repair of Glass Furnaces by Ceramic Welding Techniques," that combination is said to render obvious to a person skilled in the art the teaching of the two patents now in suit (proposed Findings 36-39).

Each of those three contentions fails.

Northlake's Activities

On this first of Northlake's arguments, the matter boils down to a failure of proof on Northlake's part. No one provided any evidence on its behalf, nor is there a legitimate basis for inference, as to the relevant particle size distributions in the 1984 demonstration that is said to have taken place at United States Steel. Northlake's use of oral testimony alone regarding that alleged demonstration (something that has been disfavored for more than a century (The Barbed Wire Patent Case, 143 U.S. 275, 284-85, 12 S.Ct. 443, 447, 36 L.Ed. 154 (1892)) and that continues to be looked at askance in current Federal Circuit case law, see, e.g., Sjolund v. Musland, 847 F.2d 1573, 1578 (Fed.Cir.1988) and Mahurkar v. C.R. Bard, Inc., 79 F.3d 1572, 1577 (Fed.Cir.1996) and earlier cases cited there) cannot properly be buttressed by testimony about Northlake's later efforts to purchase a silica product. And even apart from the serious doubt that the trial demonstration at United States Steel was "commercial"—that is, public—as is required by the relevant case law (see, e.g., Chester v. Miller, 906 F.2d 1574, 1577 n. 2 (Fed.Cir.1990)), there is no evidence to support either the participants' knowledge (May testified in that regard) or the facts as to the composition of the powder involved—and that composition of course is critical to the essence of the Glaverbel invention, and hence to any potential for anticipation of that invention. Northlake simply has not met any burden of proof (however measured) along those lines.

As for Northlake's claimed ceramic welding activity between that September 1984 date and 1986, it should first be said that Northlake's proposed Finding 18 creates an erroneous impression of continuous welding activity on its part. Instead May's testimony was that it began such activity in the spring of 1986. More importantly, however, again Northlake fails in evidentiary terms to tie its usage to powder providing the particle sizes and granulometry that the '468 and '084 Patents set out as the critical components of the Glaverbel invention. Again any claim of anticipation based on Northlake's pre-Patent activities fails.

Glaverbel's Prior Patents

As stated at the outset of this opinion, this is only the latest chapter in the protracted and wide-ranging war between the parties. Most critically for present purposes, Glaverbel-Fosbel correctly contend that Northlake is foreclosed by issue preclusion principles from relitigating a contention that they have earlier tried and lost in Belgian litigation between the same parties: Northlake's assertion that Glaverbel's two prior art patents (the '022 and '560 Patents, the only patents on which Northlake relies to sustain its position) disclose the same invention as the now-at-issue '468 and '084 Patents. Whether Seventh Circuit jurisprudence (see Havoco of Am., Ltd. v. Freeman, Atkins & Coleman, Ltd., 58 F.3d 303, 307-08 (7th Cir. 1995)) is to be looked to because the Federal Circuit would defer to it on substantive issues not unique to patent law (Hybritech Inc. v. Abbott Labs., 849 F.2d 1446, 1451 n. 12 (Fed.Cir.1988)), or whether the Federal Circuit's own case law (see In re Freeman, 30 F.3d 1459, 1465 (Fed.Cir.1994)) would control instead, the elements of issue preclusion are precisely the same: (1) each of the two lawsuits involved the issue that is now under consideration as potentially precluded from relitigation, (2) that issue was actually litigated in the earlier lawsuit, (3) determination of that issue was necessary to a final decision there and (4) the losing party had an opportunity to litigate that issue fully and fairly.

Although Northlake seeks to wriggle out of its own earlier acknowledgment to that effect, there is no dispute that the Belgian patents at issue (those involved in the Belgian...