Standard Oil Co. v. Nippon Shokubai Kagaku Kogyo Co., Ltd., 84-1500

• Decision Date: 08 February 1985
• Docket Number: No. 84-1500,84-1500
• Citation: 754 F.2d 345,224 USPQ 863
• Parties: The STANDARD OIL COMPANY, Appellant, v. NIPPON SHOKUBAI KAGAKU KOGYO CO., LTD., Appellee. Appeal
• Court: U.S. Court of Appeals — Federal Circuit

Page 345

754 F.2d 345

224 U.S.P.Q. 863

The STANDARD OIL COMPANY, Appellant, v. NIPPON SHOKUBAI KAGAKU KOGYO CO., LTD., Appellee.

Appeal No. 84-1500.

United States Court of Appeals Federal Circuit.

Feb. 8, 1985.

Eben G. Crawford, Squire, Sanders & Dempsey, Cleveland, Ohio, argued for appellant. With him on brief was Daniel R. Cherry, Cleveland, Ohio; David J. Untener, Cleveland, Ohio, of counsel.

S. Leslie Misrock, Pennie & Edmonds, New York City, argued for appellee. With him on the brief were Rory J. Radding, New York City, and Joseph V. Colaianni, Pennie & Edmonds, Washington, D.C.

Before FRIEDMAN, RICH and DAVIS, Circuit Judges.

RICH, Circuit Judge.

This appeal is from the final judgment of May 25, 1984 (as amended June 29, 1984) ¹ of the District Court for the Southern District of Texas, Houston Division, granting appellee's motion for summary judgment and dismissing the cause of action as to Nippon Shokubai Kagaku Kogyo Co., Ltd. (Nippon), ² on the dual grounds of laches and a bar to any recovery by reason of 35 U.S.C. Sec. 286. We affirm on the latter ground.

Background

Plaintiff-appellant is an Ohio corporation and its counsel have referred to it as "Sohio." We shall do the same. This is a suit for infringement and contributory infringement of Sohio's Callahan et al. patent No. 2,941,007 ('007 patent) issued June 14, 1960, for PROCESS FOR THE OXIDATION OF OLEFINS.

The patent claims a process for making acrolein, in which process a bismuth molybdate catalyst is employed. Rohm and Haas Company and its subsidiary Rohm and Haas Texas, Incorporated (collectively R & H) have practiced the process, obtaining the catalyst from Nippon. The first use of the process by R & H was in 1973 in an experimental or pilot plant operation in Philadelphia in which a relatively small amount (about 200 pounds) of the catalyst was required. Subsequently R & H built a production plant in Texas and obtained from Nippon a large quantity of catalyst which has been described as "a full charge and one-half of catalyst" for the new Texas This so-called statute of limitations, referred to by counsel, is section 286 of the Patent Act of 1952, Title 35 U.S.C., which reads in pertinent part:

                plant.  This large quantity was shipped to R & H in Texas by Nippon in July, August, and November, 1975.  Operation of that Texas plant began on November 18, 1976.  The record shows no sale or delivery of catalyst by Nippon to R & H after 1975 and none is alleged.  This suit was commenced against R & H and Nippon on November 18, 1982, six years "to a day," as Sohio's counsel said, after the alleged infringement by R & H in Texas began by use of the Callahan process of the '007 patent. 3   Having delayed that long, Sohio counsel explained that suit was then brought because "the statute of limitations came upon us.  And that is the reason we ultimately did file it."    Another statement of counsel was, "We were forced by the statute of limitations to file this lawsuit against Rohm and Haas and N.S.K.K. else we would lose our right under the statute of limitations."
                

Sec. 286. Time limitation on damages

Except as otherwise provided by law, no recovery shall be had for any infringement committed more than six years prior to the filing of the complaint or counterclaim for infringement in the action.

It was derived from a similar provision in the prior statute, R.S. 4921, third paragraph, which read:

The court shall assess ... damages ...; but recovery shall not be had for any infringement committed more than six years prior to the filing of the complaint in the action.

About seven months after the R & H Texas plant went into production, the Callahan '007 patent expired on June 14, 1977, seventeen years after its issuance and more than five years before the commencement of this action.

OPINION

The only act of Nippon alleged to constitute any kind of infringement of the '007 patent is the selling to R & H of catalyst for use in the Callahan process covered by the patent. The sale of catalyst does not, of course, constitute practice of the patented process and is not direct infringement. Nippon has not been charged with direct infringement but only with "inducing infringement" or "contributory infringement." See 35 U.S.C. Sec. 271(b) and (c). There is no discussion in the briefs of what, if anything, Nippon has done other than the sale of catalyst to constitute such forms of infringement and therefore we need not discuss these sometimes difficult questions.

The determinate fact here is that all of the acts of Nippon complained of took place and were over and done with before the end of 1975. This suit was filed November 18, 1982, at least six years, nine months, and eighteen days thereafter. At that time, the '007 patent had been long expired so no prospective relief, such as injunction or a holding of infringement by sale of catalyst subsequent to June 14, 1977, is a possibility. A possible award of damages by reason of the sales already affected is the only matter to be considered. Assuming infringement, arguendo, and consequent damage, we turn now to a discussion of the effect of Sec. 286, quoted above.

Black's law dictionary (4th Ed.1968) defines a statute of limitations thus:

A statute prescribing limitations to the right of action on certain described causes of action; that is, declaring that no suit shall be maintained on such causes of action unless brought within a specified period after the right accrued. Statutes of limitation are statutes of repose. [Emphasis ours.]

Reading Sec. 286 in light of this definition shows that this statute is not a statute of limitations barring suit in the usual meaning of the term. It does not say that "no suit shall be maintained." Take, for example the situation of R & H in this case as it was before the district court. R & H was allegedly continuing the use of the '007 patent process. Waiting for more than six years after that use commenced did not create a bar under Sec. 286 to the bringing of a suit for infringement or maintaining the suit. Assuming a finding of liability, the only effect Sec. 286 has is to prevent any "recovery ... for any infringement committed more than six years prior to the filing of the complaint...." Therefore, suit could be maintained and recovery of damages could be had for infringement taking place within the six years prior to the filing of the complaint. This assumes, of course, no other impediment to recovery or maintenance of the suit such as application of the doctrine of laches.

Since Sec. 286 cannot properly be called a "statute of limitations" in the sense that it defeats the right to bring suit, it cannot be said that the statute "begins to run" on some date or other. In the application of Sec. 286, one starts from the filing of a complaint or counterclaim and counts backward to determine the date before which infringing acts cannot give rise to a right to recover damages.

With respect to Nippon, the situation is different from that of R & H. No act of Nippon within the six years prior to suit is...