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September 19, 2007

Unappreciated

OrthoAarm held patent 6,257,883, claiming a bracket for orthodontic braces. OrthoArm sued distributor American Orthodontics for infringement; they settled for a 4% royalty. American got manufacturer Adenta to chip in half of the royalty payment. Adenta then got it into its head that the patent was no good, and advised American and OrthoArm it was going to stop paying royalties. American replied by letter that would be naughty; that American would "pursue its available legal remedies to protect its rights." So Adenta filed for declaratory judgment in the Eastern District of Wisconsin, that '833 was invalid and unenforceable.

Adenta v. OrthoArm and American Orthodontics (CAFC 2006-1571, -1598)

OrthoArm moved to dismiss the suit for lack of subject matter jurisdiction on the ground that Adenta never had a reasonable apprehension that it would be sued by American, and that Adenta and American conspired to contest the validity of the ’883 patent.

OrthoArm's arguments that the DJ motion was hinky didn't fly with the district court, nor later at appeal; on with the trial.

Adenta's prior art find was an on-sale orthodontic bracket from a trade show, as well as other exhibits.

During trial, Adenta argued that the claims of the ’883 patent were invalid based on the public use or sale of its orthodontic bracket in 1994 at the 84th Annual Session of the American Association of Orthodontists in Orlando, Florida (the “Florida trade show”), which was held more than one year before the priority date of the ’883 patent. The parties agreed that Exhibit 61, which was a photo of a bracket, represented the type of Time bracket that was allegedly shown at the trade show. Adenta presented testimony from five witnesses to verify that the type of bracket as depicted in Exhibit 61 was in fact displayed at the 1994 Florida trade show. Those witnesses were Schendell and Heiser, who worked at Adenta; John Russell, who was a sales representative for Adenta’s brackets in England; Lee Tuneberg, who was a vice president at American; and ['833] inventor Voudouris.

Adenta also presented various documents to support its claim that the Time bracket of the type shown in Exhibit 61 was displayed at the 1994 Florida trade show. Those documents included: drawings of a bracket made by Heiser in 1992 and 1993 (Exhibit 23); a German patent application that disclosed the Time bracket filed March 3, 1994 (Exhibit 52); the Florida Conference Exhibitor Guide (Exhibit 77); a fax dated June 1994 from Russell to Schendell that asked if Heiser would come to Britain to discuss the Time bracket (Exhibit 12); a German article that included photos of the Time bracket (Exhibit 7); and a letter from Adenta’s German patent attorney to Adenta’s U.S. Patent attorney instructing the U.S. attorney to file an application on the Time bracket within a year of the 1994 Florida trade show (Exhibit 24).

Adenta's dog-and-pony show worked. The jury found potentially infringed claims invalid, but did not find inventor, and president of OrthoArm, Voudouris, guilty of inequitable conduct for withholding from the PTO.

Appeal, and cross-appeal; district court judges get no respect (except in their courtroom, under their nose, of course).

OrthoArm tried to belittle the invalidity evidence presented: everybody fessing up was an interested party, with no corroborating evidence. That dog didn't hunt.

We have held that a patent cannot be invalidated based on one person’s testimony alone without corroborating evidence, particularly documentary evidence. See Finnigan Corp. v. Int’l Trade Comm’n, 180 F.3d 1354, 1369 (Fed. Cir. 1999) (“[C]orroboration is required of any witness whose testimony alone is asserted to invalidate a patent, regardless of his or her level of interest.”). However, this is not a case where one person makes a naked, unsupported assertion years after the fact that he made an invention before a patentee. Such self-serving statements based only on memory and susceptible to interpretations favorable to the witness are properly discounted. Here there were a number of statements made by different witnesses, all corroborating each other, accompanied by various supportive and consistent documents. The testimony of the witnesses together with the documentary evidence provided a coherent and convincing story.

Contrary to what OrthoArm argues, this case does not present the question of the necessity of corroboration—there was both testimonial and documentary corroborating evidence here. Rather, this case questions the sufficiency of the corroborating evidence. Assessing the sufficiency of evidence which corroborates a witness’s testimony concerning invalidating activities has been analyzed under the “rule of reason” test, and it is a jury question. Woodland Trust v. Flowertree Nursery, Inc., 148 F.3d 1368, 1371 (Fed. Cir. 1998). A “rule of reason” analysis involves an assessment of the totality of the circumstances including an evaluation of all pertinent evidence. Id. OrthoArm attempts to discredit each piece of evidence, one by one, to show that clear and convincing evidence invalidating the patent was lacking. However, the jury considered all the evidence. We cannot say that the court erred in concluding that there was sufficient evidence corroborating Heiser’s and Schendell’s testimony to enable the jury to find that the Time bracket was publicly used and/or on sale at the 1994 Florida trade show.

The court noted that Voudouris was the named inventor of the ’883 patent and president of OrthoArm. He attended the 1994 trade show and testified that it was his understanding that Adenta’s patent covers the brackets displayed at the Florida trade show.

Voudouris had disclosed the prior art patent (5,562,444) that described the on-sale product that invalidated Voudouris' patent. Yep, after reading that last sentence a couple of times, you realize that the lights were on, but nobody home, in appreciating the prior art during prosecution; once again proving that the only real problem with the U.S. patent system was bad patent office management regarding examination rigor; that problem seemingly solved by a new-found overzealousness, hence creating a new problem of unlawfully limiting examination; even worse bad management. But I digress.

Dead patent affirmed.

Posted by Patent Hawk at September 19, 2007 10:54 AM | Prior Art

Comments

This has some implications on how trade shows are conducted, especially when it comes to custom displays and any copyright infringement.

Posted by: dan kenitz at September 21, 2007 8:27 AM

You've got to give it to the Adenta team for doing their due dilligence, albeit a little late, and uncovering the invalidity of the patent. But I do wonder if the individual(s) who originally agree to the payments took a little heat after the fact!

Posted by: San Jose Orthodontists at February 7, 2011 3:52 PM