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August 14, 2009

In the Weeds

Callaway Golf sued Acushnet over four golf ball patents. Acushnet teed itself up with an admission of infringement, but tried to whack the asserted claims into the sand trap of prior art invalidity. The district court judge granted summary judgment of no anticipation. A trial on obviousness found all but one claim in the fairway, Callaway seemingly a short pitch to the green. Acushnet appealed, wanting a mulligan over the anticipation bogie, and an inconsistent jury finding upheld by the district court. They got it.

Callaway Golf v. Acushnet (CAFC 2009-1076) precedential

Acushnet tried to introduce shady supposed prior art testimony, first through an expert witness, then through an Acushnet employee. Delaware district court Judge Sue L. Robinson blocked both attempts, and the CAFC panel let that stand.

Acushnet also tried to introduce its filing an inter partes reexamination into the proceedings.

Acushnet sought to introduce the re-examination at trial to counter Callaway's statements in opening arguments that, by approving the four Sullivan patents, "three patent examiners" had concluded that they were valid. The district court rejected Acushnet's request, stating that giving evidence of the re-examination to the jury would be "really confusing," not least because the results of the non-final parallel proceeding were "not binding" on the district court. Trial Tr. 354:16-17. The court did, however, preclude Callaway from further bolstering the validity of the patents by further repeating the "three examiners" statements.

The CAFC backed the district court judge there too.

On this point the district court did not err. The non-final re-examination determinations were of little relevance to the jury's independent deliberations on the factual issues underlying the question of obviousness. In contrast, the risk of jury confusion if evidence of the non-final PTO proceedings were introduced was high. The district court did not abuse its discretion in concluding that the prejudicial nature of evidence concerning the ongoing parallel re-examination proceeding outweighed whatever marginal probative or corrective value it might have had in this case.

The odd ball was that the jury had found a dependant claim invalid, but the independent claim upon which it relied valid, and the district court judge let that stand.

There is no dispute that the verdicts with respect to claim 5 of the '293 patent (invalid) and claim 4 of that patent (not invalid) were inconsistent. A broader independent claim cannot be nonobvious where a dependent claim stemming from that independent claim is invalid for obviousness. See Ormco Corp. v. Align Tech., Inc., 498 F.3d 1307, 1319 (Fed. Cir. 2007).

The district court recognized that under Third Circuit law a court faced with inconsistent general verdicts after the jury is dismissed has an obligation to attempt to read the verdicts in a manner that will resolve the inconsistencies. JMOL Order, 585 F. Supp. 2d at 616-17; see Mosely, 102 F.3d at 90. Although the district court agreed with Acushnet that the verdicts here were genuinely and irreconcilably inconsistent, it nevertheless denied Acushnet's motion for a new trial. The court noted that Acushnet "stipulated that it infringes each of the Sullivan patents; three of which were held valid by the jury without reservation," and that the inconsistency therefore was harmless. JMOL Order, 585 F. Supp. 2d at 617.

This reasoning is flawed. Although it is true that the jury found "without reservation" that eight claims were not invalid, it is equally true that the jury found claim 5 invalid without reservation. Moreover, the evidence at trial was such that the jury could have rationally reached either verdict with regard to the asserted claims; neither party was entitled to judgment as a matter of law. Under Third Circuit law, in a case where a reading of the verdicts that would solve the apparent inconsistency proves impossible and the evidence might support either of the two inconsistent verdicts, "'the appropriate remedy is ordinarily, not simply to accept one verdict and dismiss the other, but to order an entirely new trial.'" Mosely, 102 F.3d at 90 (quoting Los Angeles v. Heller, 475 U.S. 796, 806 (1986) (Stevens, J., dissenting)).

The flag leading to the hole in summary judgment over anticipation was over the lead prior art reference (Nesbitt) incorporating another patent (Molitor) by reference. The district court judge had bizarrely only allowed limited incorporation, a doctrine that has zero basis in law.

To incorporate matter by reference, a host document must contain language "clearly identifying the subject matter which is incorporated and where it is to be found"; a "mere reference to another application, or patent, or publication is not an incorporation of anything therein . . . ." In re de Seversky, 474 F.2d 671, 674 (CCPA 1973). Put differently, "the host document must identify with detailed particularity what specific material it incorporates and clearly indicate where that material is found in the various documents." Adv. Display Sys., 212 F.3d at 1282. Nesbitt identifies with specificity both what material is being incorporated by reference (foamable polymeric compositions suitable for golf ball cover layers) and where it may be found (the Molitor patent). Nesbitt col.3 ll.51-61. We have previously held that language nearly identical to that used in Nesbitt ("[r]eference is made to") can be sufficient to indicate to one of skill in the art that the referenced material is fully incorporated in the host document. See In re Voss, 557 F.2d 812, 815-16 (CCPA 1977); In re Hughes, 550 F.2d 1273, 1275-76 (CCPA 1977). Here, however, the district court held that Nesbitt satisfies the requirements for incorporation only with regard to the ionomer resins disclosed in Molitor, stating that "Molitor '673 is mentioned in Nesbitt to identify examples of suitable resins, preferably ionomer resins, and not to specifically incorporate polyurethane." Summary Judgment Order, 523 F. Supp. 2d at 396.

Because Nesbitt incorporates the compositions taught by Molitor '637, we reverse the judgment of the district court granting summary judgment to Callaway and remand for further proceedings on that issue.

Tee it up again, the CAFC ruled: a new trial.

Posted by Patent Hawk at August 14, 2009 11:28 PM | Prior Art


Patent Hawk --

Your introductory paragraph was very clever. Nice going.

Posted by: Michael G. Sullivan at August 15, 2009 6:50 AM

Hawk, you must be a golfer...

Posted by: Blimpy at August 17, 2009 7:54 AM