Praxair, Inc. v. Atmi, Inc.

• Decision Date: 29 September 2008
• Docket Number: No. 2007-1509.,No. 2007-1483.,2007-1483.,2007-1509.
• Citation: 543 F.3d 1306
• Parties: PRAXAIR, INC. and Praxair Technology, Inc., Plaintiffs-Appellants, v. ATMI, INC. and Advanced Technology Materials, Inc., Defendants-Cross Appellants.
• Court: U.S. Court of Appeals — Federal Circuit

543 F.3d 1306

PRAXAIR, INC. and Praxair Technology, Inc., Plaintiffs-Appellants, v. ATMI, INC. and Advanced Technology Materials, Inc., Defendants-Cross Appellants.

No. 2007-1483.

No. 2007-1509.

United States Court of Appeals, Federal Circuit.

September 29, 2008.

Christopher J. Harnett, Ropes & Gray LLP, of New York, NY, argued for plaintiffs-appellants. With him on the brief were Herbert F. Schwartz, Steven Pepe, David A. Bergan, Brian P. Biddinger, and Moriah R. Agovino.

Matthew D. Powers, Weil, Gotshal & Manges LLP, of Redwood Shores, California, argued for defendants-cross-appellants. With him on the brief were Timothy E. DeMasi, and Michael B. Eisenberg of New York, NY. Of counsel were Aaron M. Frankel and Theodore J. Mlynar, Kramer, Levin, Naftalis & Frankel LLP, of New York, NY.

Before LOURIE, BRYSON, and DYK, Circuit Judges.

Opinion concurring in part and dissenting in part filed by Circuit Judge LOURIE.

DYK, Circuit Judge.

Plaintiffs Praxair, Inc. and Praxair Technology, Inc. (collectively "Praxair") brought suit alleging that defendants ATMI, Inc. and Advanced Technology Materials, Inc. (collectively "ATMI") had infringed three patents: U.S. Patent No. 6,007,609 (the "'609 patent"); U.S. Patent No. 6,045,115 (the "'115 patent"), and U.S. Patent No. 5,937,895 (the "'895 patent"). The district court entered a final judgment concluding that claims 1, 2, 6, 7, and 8 of the '609 patent and claims 18 and 20 of the '115 patent were not invalid and were infringed; declaring the '609 and '115 patents unenforceable due to inequitable conduct; and declaring claims 1, 3, 4, 5, 7, and 8 of the '895 patent invalid for indefiniteness. Praxair, Inc. v. ATMI, Inc., No. 03-1158-SLR (D.Del. July 2, 2007).

We affirm the district court's determination that the '115 patent is unenforceable due to inequitable conduct. We reverse the district court's unenforceability conclusion with respect to the '609 patent. We affirm the determination that the asserted claims of the '609 patent were not proven invalid, vacate the determination of infringement with respect to the '609 patent (because the district court used an incorrect claim construction), and remand for a determination as to infringement of the '609 patent under the correct claim construction. We also reverse the district court's judgment of invalidity for indefiniteness of the asserted claims of the '895 patent and remand for further proceedings. As to Praxair's appeal, we thus affirm-in-part, reverse-in-part, and remand. We dismiss ATMI's cross-appeal as improper.

BACKGROUND

I

Praxair is the present owner of the '609, '115, and '895 patents, all of which describe pressurized storage containers that limit potentially rapid accidental discharges of hazardous gasses that could otherwise pose a serious threat to health and safety. The gasses to which the patents relate, which are described in the claims as "fluids," are frequently used in the semiconductor industry and are ultimately used in their gas phase. However, they are often stored in pressurized cylinders that contain the chemical in a mix of its gas and liquid phases.

The asserted claims of the '609 patent, entitled "PRESSURIZED CONTAINER WITH RESTRICTOR TUBE HAVING MULTIPLE CAPILLARY PASSAGES," claim an apparatus with a flow restrictor comprised of multiple capillary passages in the "flow path" through which the chemical fluid, in either its gas or liquid phase, is dispensed.¹ One embodiment of the invention described in the '609 patent requires placement of this capillary flow restrictor inside the pressurized storage cylinder. The '115 patent, entitled "FAIL-SAFE DELIVERY ARRANGEMENT FOR PRESSURIZED CONTAINERS," also concerns the use of a capillary flow restrictor. Asserted claims 18 and 20 of the '115 patent require locating the capillary flow restrictor inside the pressurized tank near the axial-radial midpoint of the tank to prevent the discharge of liquid phase fluids, thereby avoiding corrosion of downstream equipment.²

The '895 patent, entitled "FAIL-SAFE DELIVERY VALVE FOR PRESSURIZED TANKS," teaches the use of a valve that allows the release of fluid from a pressurized container only when the downstream pressure falls below a preset limit. This automatically limits the discharge of the pressurized fluid from the container, because any rapid release would increase the downstream pressure, closing the valve until the pressure fell back below the preset limit.³

Praxair produces pressurized gas storage and delivery cylinders under the product name "Uptime," which the parties agree are a commercial embodiment of at least the '609 and '115 patents. Since 1997, ATMI has produced the accused products, a line of pressurized gas storage and delivery cylinders referred to as "Vacuum-Actuated Cylinder" ("VAC") products. The VAC product is designed with a pressure regulation device inside the pressurized cylinder. The pressure regulation device includes sealed bellows that contain an inert gas at a known pressure. When the pressure downstream from the bellows exceeds a preset pressure, the bellows close, stopping the discharge of fluid from the cylinder. When the downstream pressure falls below the preset pressure, the bellows expand, opening a path around the bellows that allows fluid to leave the pressurized cylinder. The VAC products also include two or three sintered metal filters, including at least one filter located inside the pressurized cylinder upstream from the bellows.⁴ Praxair's Uptime and ATMI's VAC products directly compete. Indeed, they are the only commercially available, mechanical systems to control delivery of hazardous gasses of the type used in the semiconductor industry.

II

On December 22, 2003, Praxair filed suit in the United States District Court for the District of Delaware alleging that ATMI's VAC products infringe the '609, '115, and '895 patents. Ultimately, Praxair asserted claims 1, 2, 6, 7, and 8 of the '609 patent; claims 18 and 20 of the '115 patent; and claims 1, 3, 4, 5, 7, and 8 of the '895 patent. On March 8, 2004, ATMI filed an answer asserting invalidity as an affirmative defense and asserting counterclaims for a declaratory judgment of noninfringment and invalidity as to the '609, '115, and '895 patents. ATMI subsequently filed an amended answer asserting an additional affirmative defense and counterclaim alleging unenforceability due to inequitable conduct with respect to all three patents.

On November 8, 2005, the district court entered a claim construction order, which, among other things, adopted Praxair's proposed constructions of the claim terms "flow restrictor" and "capillary" used in the '609 patent and the term "restrictor in the form of a restricted flow path" used in the '115 patent. On the same day, the district court entered partial summary judgment declaring claim 1 of the '895 patent, from which all of the other asserted claims of the '895 patent depend, invalid for indefiniteness. The district court reasoned that "the term `port body' [in the '895 patent claim 1] ... is not described, labeled, or coherently discussed in the patent. The meaning of the term `port body' is not discernable from the patent specification." Praxair, Inc. v. ATMI, Inc., 231 F.R.D. 457, 461 (D.Del.2005).

On December 7, 2005, after a five day jury trial on validity and infringement of the asserted claims of the '609 and '115 patents, the jury returned a verdict finding that ATMI's accused products infringed all of the asserted claims of the '115 and '609 patents. The jury also determined that ATMI had not proven invalidity of any of the asserted claims.

On May 9, 2006, Praxair moved for a permanent injunction. On March 27, 2007, the district court denied Praxair's motion. Although the district court found that ATMI's accused VAC products were the only mechanical products in direct competition with Praxair's commercial products, it concluded that Praxair had not met its burden to prove the inadequacy of money damages. However, the court stated that "Praxair may renew its motion for injunctive relief following appellate review of the jury verdict." Praxair, Inc. v. ATMI, Inc., 479 F.Supp.2d 440, 444 (D.Del.2007).

On December 12, 2005, the district court held a bench trial on ATMI's inequitable conduct defense and counterclaim with respect to the '609 and '115 patents. ATMI asserted inequitable conduct based on three types of prior art that it alleged the applicants withheld from the United State Patent and Trademark Office ("PTO"). On August 17, 2006, the district court issued an initial opinion on the issue of inequitable conduct, concluding that one item of prior art, the so-called "Max Light devices," was not material. The district court determined that two other items of prior art, U.S. Patent No. 5,409,526 (the "Zheng patent") and restricted flow orifice ("RFO") art were material, but deferred a final ruling on the issue of intent to deceive.⁵

On June 13, 2007, the district court issued a second inequitable conduct opinion. Although the district court determined that the Zheng patent was material and that the attorney who prosecuted the '609 and '115 patents, John Tolomei, had knowledge of the Zheng patent, the district court found that there had been no showing of intent to deceive the PTO with respect to the failure to disclose this reference. The district court instead credited Tolomei's testimony that he had a good faith basis for failing to disclose the Zheng patent because he believed that it was not material.

However, the district court found that RFOs were material. As to intent to deceive, the district court found that both the inventors of the '609 and '115 patents and Tolomei had knowledge of RFO devices, which were widely used prior to the applications that led to the '115 and '609 patents. The district court focused, in particular, on four statements made in the prosecution history of the '115 patent characterizing the prior art.⁶ The...