Rhenalu v. Alcoa, Inc., CIV.A.99-301-SLR.

• Court: U.S. District Court — District of Delaware
• Writing for the Court: Sue L. Robinson
• Citation: Rhenalu v. Alcoa, Inc., 224 F.Supp.2d 773 (D. Del. 2002)
• Decision Date: 19 September 2002
• Docket Number: No. CIV.A.99-301-SLR.,CIV.A.99-301-SLR.
• Parties: Pechiney RHENALU, Plaintiff, v. ALCOA INC., Defendant.

224 F.Supp.2d 773

Pechiney RHENALU, Plaintiff, v. ALCOA INC., Defendant.

No. CIV.A.99-301-SLR.

United States District Court, D. Delaware.

September 19, 2002.

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Richard L. Horwitz, Potter Anderson and Corroon LLP, Wilmington, DE Covington & Burling, Washington, D.C. (James R. Atwood, William D. Iverson, Christopher N. Sipes, of counsel), for plaintiff.

R. Franklin Balotti, Frederick L. Cottrell, III, Richards, Layton & Finger, Wilmington, DE, Cravath, Swaine & Moore, New York City (Evan R. Chesler, Daniel Slifkin), for defendant.

OPINION

SUE L. ROBINSON, Chief Judge.

I. INTRODUCTION

Plaintiff Pechiney Rhenalu ("Pechiney") filed this action against defendant Alcoa, Inc. ("Alcoa") on May 12, 1999, seeking a declaratory judgment that its 2024A aluminum alloy product ("2024A alloy") does not infringe Alcoa's United States Patent No. 5,213,639 (the "'639 patent") and that the '639 patent is invalid, as well as seeking damages for Alcoa's alleged tortious interference with Pechiney's prospective business relations.¹ (D.I.1) On February 29, 2000, Alcoa filed a counterclaim asserting that the 2024A alloy infringes the '639 patent. (D.I.174) Pechiney filed an amended complaint in March 2000 adding a claim of inequitable conduct. (D.I.175) The parties later stipulated that they "withdraw with prejudice their pending requests for monetary relief, and further agree that no monetary relief (including damages) will be sought in this litigation." (D.I.245)

Following discovery, Alcoa offered Pechiney a covenant not to sue for infringement of the process, product-by-process, and certain product claims of the '639 patent, consequently, these claims were dismissed from the case. (D.I.366) On December 22, 2000, the court held that claims 81 and 82 were invalid as to this action due to a typographical error. (D.I.385)

From January 8, 2001 through January 18, 2001, the parties tried the issues of validity and infringement to a jury, and the issue of inequitable conduct to the court. During the trial, Alcoa offered Pechiney a covenant not to sue on several additional product claims, which were also dismissed. (D.I.410) At the close of trial, Alcoa was asserting infringement of sixty product claims of the '639 patent.²

On January 18, 2001, the jury returned a verdict that the asserted claims are infringed by the 2024A alloy, not invalid as anticipated under the on-sale bar of 35 U.S.C. § 102(b), and not invalid as obvious under 35 U.S.C. § 103(a). (D.I.417) On March 29, 2001, the court entered judgment in favor of Alcoa and against Pechiney based on the jury's verdict. (D.I.455)

On September 28, 2001, following briefing and oral argument on post-trial motions, the court vacated the judgment based on the jury's verdict pursuant to Tegal Corp. v. Tokyo Electron Am., Inc., 257 F.3d 1331 (Fed.Cir.2001), cert. denied, ___ U.S. ___, 122 S.Ct. 1297, 152 L.Ed.2d 209 (2002), and ordered the parties to file proposed findings of fact and conclusions of law. (D.I.480)

The court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 1331, 1338(a), 2201 and 2202. The following are the court's findings of fact and conclusions of law pursuant to Fed.R.Civ.P. 52(a).

II. FINDINGS OF FACT

A. The Parties

1. Pechiney is a corporation organized and existing under the laws of France and having its principal place of business in Paris, France. Pechiney is a producer of aluminum and aluminum products, including aerospace alloys, which it sells in numerous countries, including the United States. (D.I. 424 at 1814).

2. Alcoa is a corporation organized and existing under the laws of the Commonwealth of Pennsylvania and having its principal place of business in Pittsburgh, Pennsylvania. Alcoa is the world's largest commercial producer of aluminum and aluminum alloys for aerospace applications, which it sells throughout the United States and the world. (Id. at 1814-15).

B. The Field of the Invention

3. Aluminum alloy products have long been used as the primary building material for commercial aircraft because of their strength and damage tolerance in relation to weight. (Id. at 1815).

4. Strength refers to the stress an alloy is able to withstand without breaking. (D.I. 418 at 151-52).

5. Damage tolerance refers to the ability of an alloy to resist failure due to the presence of flaws, cracks or other damage for a specified period of usage. (D.I. 423 at 1339) Fracture toughness and fatigue crack growth rate are the damage tolerance properties of an alloy. (D.I. 418 at 154-61).

6. Fracture toughness is the measurement of an alloy's ability to resist the extension of a crack, often measured in terms of the stress intensity factor (K) at which applying progressively greater stress to a structure that contains a pre-existing crack causes the onset of rapid catastrophic propagation of that crack. (DX 188, col. 9, Ins. 55-58; D.I. 418 at 154) The fracture toughness values reported in the '639 patent are referred to as K_c or K_app values and measured in units of ksi in. (DX 188, cols. 10-11) K_c values are slightly higher than K_app values for the same material because K_app is based on initial crack strength and final failure stress. (D.I. 418 at 157-58).

7. Fatigue cracks in an airplane fuselage result from cycles of stressing and relaxing, such as the repeated loading and unloading that might occur as a wing moves up and down or a fuselage swells with pressurization and contracts with depressurization. (DX 188, col. 11, Ins. 55-60; D.I. 418 at 153) Fatigue crack growth rate is the rate of crack extension caused by these cycles, measured in terms of average crack extension per cycle (da/dN). (DX 188, col. 11, Ins. 56-67; D.I. 418 at 160-61) "K" refers to the difference between the maximum and minimum loads (in ksi in), and the "R ratio" refers to the ratio of minimum to maximum load. (D.I. 418 at 162) A "T-L" crack is one that is oriented in the longitudinal direction of the airplane fuselage, and an "L-T" crack is one that is oriented wing to wing across the top of the fuselage.³ (Id. at 158-160).

8. Damage tolerance in aluminum alloy products is impaired by the presence of undissolved particles, which facilitate crack growth and thereby reduce fracture toughness and increase an alloy's fatigue crack growth rate. Iron (Fe) and Silicon (Si) particles are insoluble in aluminum, and can be reduced or minimized only by using a high-purity base aluminum material with smaller quantities of these impurities. (PX 585A; D.I. 421 at 813-17; D.I. 423 at 1342) Copper (Cu), Magnesium (Mg) and Manganese (Mn) are soluble in aluminum, but only up to a certain point. These particles may be reduced by controlling composition of the alloy so that the particles are limited to amounts that can be dissolved in the aluminum during the production process. (Id.) The soluble particles may also be reduced by using thermal treatments to dissolve them in the aluminum as much as possible. High-temperature heat treatments are desirable for this purpose because solubility limits are higher at higher temperatures. (PX 585A; D.I. 423 at 1346-47).

9. The typical production process for aluminum alloy products involves several steps. First, the aluminum elements are melted in a furnace and cast into solid ingots which, for aircraft applications, are typically 20 feet long, 14-16 inches thick, and 20,000 pounds in weight. (Id. at 365-67) Next, the ingot is heated in a furnace and, if desired, a layer of cladding is applied.⁴ (Id. at 369) Then, the heated ingot is "hot-rolled" to reduce its thickness. (Id. at 370, 380-81) Next, the material is subjected to a solution heat treatment, during which a high temperature is applied for a short time to move the elements within the material to their most beneficial positions. (Id. at 371-72) Finally, the material is "quenched" or rapidly cooled to lock the elements in those positions.⁵ (Id. at 372).

10. Aluminum alloy products are formed into either "sheet" or "plate." Sheet products have a maximum thickness of 1/4 inches, whereas plate products have a maximum thickness of 5/8 inches. (DX 188, col. 6, Ins. 55-58, col. 10, Ins. 5-40) Airplane fuselage is made of aluminum sheet. (D.I. 418 at 212).

11. The Aluminum Association in Washington, D.C. has developed an International Alloy Designation System to designate the allowable range of composition of various common aluminum alloys. (D.I. 424 at 1815-16) All "2XXX" series alloys are comprised of wrought aluminum alloys in which the major alloying ingredient is copper. (Id.) The "2X24" or "2024-type" alloys are those with the principal alloying elements being copper, magnesium and manganese, and the Aluminum Association designation has set upper and lower percentage limits for each of these elements. (Id.) Iron and silicon are also present as impurities, and the Aluminum Association designation has set an upper percentage limit for each. (Id.).

12. For at least fifty years, the fuselage skin of many commercial aircraft has been manufactured with clad 2024-T3 alloys. (D.I. 424 at 1815-16; D.I. 418 at 170; D.I. 423 at 1339) "T3" refers to the heat treatment of the alloy. (D.I. 418 at 164).

C. Development of Alcoa's 2524 Alloy

1. Boeing's Request for a New Alloy

13. Boeing is the only manufacturer of large commercial jet liners in the United States. (Id. at 183).

14. In late 1988, Boeing asked Alcoa to develop an improved aluminum alloy for use as the fuselage skin on the forthcoming new design 777 aircraft.⁶ (D.I. 424 at 1816; D.I. 418 at 205; DX 28) Boeing was looking for a material with improved fracture toughness and fatigue crack growth resistance to increase safety and reduce inspections and repair costs. The material had to be as strong and formable⁷ as 2024-T3, and resistant to corrosion. (DX 28; DX 35; DX 46; D.I. 418 at 208-10, 216, 222-23) Weight savings was also a concern for Boeing.⁸ (PX 2319)....