Tyler Refrigeration Corp. v. Kysor Indus., Civ. A. No. 79-497-JLL.

• Decision Date: 17 January 1985
• Docket Number: Civ. A. No. 79-497-JLL.
• Citation: 225 USPQ 492,601 F. Supp. 590
• Parties: TYLER REFRIGERATION CORPORATION, Plaintiff, v. KYSOR INDUSTRIAL CORPORATION, Defendant.
• Court: U.S. District Court — District of Delaware

601 F. Supp. 590

225 USPQ 492

TYLER REFRIGERATION CORPORATION, Plaintiff, v. KYSOR INDUSTRIAL CORPORATION, Defendant.

Civ. A. No. 79-497-JLL.

United States District Court, D. Delaware.

January 17, 1985.

William T. Allen of Morris, Nichols, Arsht & Tunnell, Wilmington, Del., and Robert E. LeBlanc, Charles Boukus and Henry Shur of LeBlanc, Nolan, Shur & Nies, Arlington, Va., of counsel, for plaintiff.

Steven J. Rothschild, Edward P. Welch and Stephen E. Jenkins of Skadden, Arps, Slate, Meagher & Flom, Wilmington, Del., Richard C. Cooper and Randall G. Litton of Price, Heneveld, Huizenga & Cooper, Grand Rapids, Mich., and David W. Crooks, Vice President and Gen. Counsel of Kysor Industrial, Cadillac, Mich., of counsel, for defendant.

OPINION

LATCHUM, Senior District Judge.

I. INTRODUCTION

This is a patent infringement suit in which the plaintiff and defendant each contends that the other infringes its patent or patents.¹ The complaint, originally filed by Tyler Refrigeration Corporation ("Tyler") against Kysor Industrial Corporation ("Kysor"), as supplemented, alleges Kysor's infringement of claims in Tyler's Subera et al. U.S. Patents Nos. 4,140,720, 4,207,747 and 4,283,922 (collectively called "the Subera patents" or "'720, '747 or '922 patents").² (Docket Item "D.I." 72.) Kysor, in its answer to Tyler's supplemented complaint, included an amended counterclaim, alleging that all three Tyler patents are invalid and not infringed and that they are unenforceable because of fraud practiced in their procurement. (D.I. 77.) In addition, Kysor alleges that Tyler infringes claims 3 and 6 of its U.S. Patent No. 4,026,121 (the "Aokage patent").³ (D.I. 77.) Tyler replied to Kysor's counterclaims and asserted that the contention that Kysor's Aokage patent is invalid and unenforceable with a number of various other defenses including a contingent antitrust claim. (D.I. 84.)

The case was tried on the validity and infringement issues to the Court without a jury from August 20 to 24, 1984.⁴ After carefully considering the sufficiency, weight and credibility of the testimony of the witnesses, their demeanor on the stand, the documentary evidence admitted at trial and the post-trial submissions of the parties, the Court enters the following findings of fact and conclusions of law which are embodied in this opinion as permitted by Rule 52(a), Fed.R.Civ.P.

II. THE FACTS

A. The Invention In Issue

The invention claimed by both parties is a new and unique technique for defrosting upright, open front refrigerated display cases of the type usually seen in supermarkets for merchandising frozen food products. (D.I. 290, III, ¶ 7; DX 1 & 3.)⁵ These types of display cases, as they developed during the 1960's and early 1970's, employed two or three adjacent and parallel air curtains flowing down out of upper outlets and across the front to lower return openings. The primary or innermost curtain is refrigerated. The secondary or guard air curtain is not. Both the primary and secondary air curtains are recirculated around the interior of the display case in internal ducts. If an optional third or outermost ambient air curtain is used, that curtain is formed by a partial duct at the top of the display case and is not recirculated but simply flows down across the face of the case onto the floor of the store. All of this technology was known prior to all the patents at issue in this action. (D.I. 290, III, ¶ 5.)

A refrigeration coil, located in the innermost duct of the case, is used to cool the air of the primary air curtain. Because of the build-up of frost, this coil requires periodic defrosting of its surface area several times a day. Prior practice of defrosting included using an electric heater to heat air flowing over the coil, using warm ambient room air for that surface, or using a hot gas flow inside the coil. (Id., ¶ 6.)

All of Tyler's Subera patents and Kysor's Aokage patent at issue here include embodiments which invoke reverse flow air defrost accomplished by reversing the normal flow of air circulation in the secondary or guard band conduit. (Id., ¶ 7.) This results in ambient air being drawn into the primary air band conduit so that during the defrost cycle, when the refrigeration mechanism is turned off, the primary air band flowing over the refrigeration coil is warmed sufficiently to defrost the coil. (Id.)

This "reverse flow air defrost" concept is advantageous in that it enables low cost construction of the display cases and, by using warm room air for defrosting, saves energy. (Id., ¶ 8.) The commercial display cases marketed by both Tyler and Kysor use reversible fans in the secondary or guard duct to achieve the reverse air flow. (Id.)

For purposes of determining infringement of claims 3 and 6 of the Aokage 121 patent (DX 1), the Tyler's model D6F display case (DX 3) is considered representative of all Tyler models charged by Kysor with infringement. (D.I. 290, III, ¶ 9.) For purposes of determining infringement of claims 35 and 36 of the Subera '720 patent, claims 1-3 of the Subera '747 patent, and claims 1-12 of the Subera '922 patent (T. 98, 99 & 100), the Kysor display case model L5FA (T. 95) is considered representative of all Kysor models charged by Tyler with infringement. (D.I. 290, III, ¶ 10.)

B. Development of Invention and Chronology of Activities of Kysor/Tyler/Fuji

Some decades ago, retail stores began to market refrigerated and frozen foods in self-service display cases. At that time, there were two types of commercially available display cases capable of holding the necessary low temperatures for frozen foods and ice cream. One type was an enclosed cabinet allowing temporary access by the customer through structural doors on the front or the top of the cabinet. The second type was an open top bin which used a gravity-retained pool of cold air in which the food products were immersed. Both of these types of units had the disadvantage of poor display and accessibility. In 1954, Edward Simons, becoming aware of the desirability of an open front display case comparable to old fashion open shelving but under low temperature refrigeration, conceived of, and was granted, United States Patent No. 2,862,369 on December 2, 1958, which was reissued to correct certain errors in 1973 as Re 27,566. The Simons basic invention was the first open front, multiple curtain, refrigerated display case. Prior to issue of the Simons patent, Simons had entered a license agreement with the Chicago Stock Yards enterprise, a predecessor of Kysor, in order to commercialize the invention and make improvements thereon. As a result of these improvement efforts, the first "Dual Jet" display case was placed on the market in 1962. By the mid-1970's, virtually every United States manufacturer involved with refrigerated display cases was marketing such cases in accordance with the "Dual Jet" technology developed by Dr. Sterling Beckwith. (DX 11; Tr. 576-77; 466; 19.)

One of the aspects of the Beckwith technology concerned velocity gradients among the refrigeration band, guard band, and ambient band. The testimony at trial was clear that the practice of having the refrigeration band operate at the greatest velocity, the guard band operate at the lower velocity, and the ambient band operate at the lowest capacity, was well-known. (Tr. 580; 466; 516; 348.) Thus, these techniques of how to construct a display case of the types involved, how to efficiently operate during the refrigeration cycle, and how to defrost it while maintaining a protective air curtain across the open front were all well known to those skilled in the art in the mid-1970's.

In 1974, Yoshitaka Aokage and Yoshio Yamana, design engineers of Fuji Denki Seizo ("Fuji"), a Japanese company, and Kysor's Japanese licensee⁶ (Tr. 461-65; 469; DX 265, at 6, 9), began working on the development of an air defrost system. (Tr. 466-71.) During this work, they conceived the idea of using reversible motor fans to reverse the air flow in certain of the recirculating air ducts while continuing the normal flow of air in the other ducts (Tr. 468; 471-72; 479; DX 265 at 9-11), in order to obtain air defrost of the refrigeration coil. This idea for the use of reversible motor fans in refrigerated display cases after testing blossomed into an application for a Japanese patent filed by Fuji on May 20, 1975 which resulted in the publication of the Japanese patent on June 6, 1977. (T. 224; D.I. 156, ¶ 91.)

The Aokage concept of air defrost was widely promoted at two trade shows in 1976. The first trade show, the 10th Japan Self-Service Association Show ("the 10th JSSA Show"), was held in Tokyo on March 3-6, 1976. (DX 156, ¶ 1.) The second trade show, known as the Third Tohoku Exhibition, occurred on April 9-11, 1976, in Sendai City, Japan. (DX 156, ¶ 33.) At both shows, the Aokage concept was publicly disclosed by means of a large photoprint drawing display panel and a related printed description panel. (DX 156, ¶ 3-73 and see photograph exhibits referred to therein.) Copies of the hand-printed and offset-printed brochures describing the Aokage air defrost concept were also available and distributed at the two trade shows. (Id., ¶¶ 28-32; 43-49.)

Among the many visitors at the 10th JSSA Show were representatives of Tyler's joint venturer and joint venture company in Japan. (DX 4, Adm. 1 & 7; DX 37; D.I. 156, ¶ 27.) At the time of the 10th JSSA Show, Okamura Tyler Co., Ltd. ("Okamura Tyler") was a Japanese corporation jointly owned by Okamura Seisakusho and Clark Equipment Company ("Clark Equipment") which then owned Tyler. (DX 156, ¶ 19.) Numerous agreements including joint venture, patent licensing, marketing and other agreements existed between these Japanese companies, Tyler's parent company and their affiliates. (Id., ¶ 19.) One of the licensing agreements required Okamura Tyler to disclose promptly to Clark Equipment "all improvements, inventions, Patents and patent...