Cimline v. Crafco (CAFC 2010-1348) nonprecedential

The warm-up for when summary judgment is appropriate, which fits in this case.

We review a district court's grant of summary judgment de novo. Revolution Eyewear, Inc. v. Aspex Eyewear, Inc., 563 F.3d 1358, 1365 (Fed. Cir. 2009). Summary judgment is appropriate where there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c); AquaTex Indus., Inc. v. Techniche Solutions, 419 F.3d 1374, 1379 (Fed. Cir. 2005). Thus, summary judgment may be granted when no "reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

Here's a much rarer warm-up: for sua sponte CAFC ruling.

A court of appeals, in the absence of a formal counterclaim or cross-motion requesting relief, may nonetheless enter judgment in favor of the non-moving party when there are no material issues of fact in dispute and the parties have had the opportunity to argue all relevant issues. See First Nat'l Bank v. Md. Cas. Co., 290 F.2d 246 (2d Cir. 1961), cert. denied, 368 U.S. 939 (1961); Procter & Gamble Indep. Union v. Procter & Gamble Mfg. Co., 312 F.2d 181 (2d Cir. 1962), cert. denied, 374 U.S. 830 (1963); see, e.g., UMC Elecs. Co. v. United States, 816 F.2d 647, 657 (Fed. Cir. 1987), cert. denied, 484 U.S. 1025 (1988) (when facts are undisputed and issue is solely one of law, appellate court need not remand but may resolve issue); Genentech, Inc. v. Novo Nordisk A/S, 108 F.3d 1361, 1368 (Fed. Cir. 1997) (invalidating patent for failure to meet the enablement requirement when the parties' arguments had been fully vetted); see also Campaign for Family Farms v. Glickman, 200 F.3d 1180, 1186-87 (8th Cir. 2000); 28 U.S.C. § 2106 ("The Supreme Court or any other court of appellate jurisdiction may affirm, modify, vacate, set aside or reverse any judgment, decree, or order of a court lawfully brought before it for review, and may remand the cause and direct the entry of such appropriate judgment, decree, or order, or require such further proceedings to be had as may be just under the circumstances."); 10A Charles Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure §§ 2716, 2720 (3d ed. 1998).

Here's the tip-off to where this is going.

''Obviousness is a question of law based on underlying findings of fact.'' In re Kubin, 561 F.3d 1351, 1355 (Fed. Cir. 2009). A patent is invalid for obviousness "if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains." 35 U.S.C. § 103(a). The underlying factual inquiries are (1) the scope and content of the prior art, (2) the differences between the prior art and the claims at issue, (3) the level of ordinary skill in the art, and (4) any relevant secondary considerations, such as commercial success, long felt but unsolved needs, and the failure of others. KSR Int'l Co. v. Teleflex Inc., 550 U.S. 398, 406 (2007) (citing Graham v. John Deere Co., 383 U.S. 1, 17-18 (1966)).

The CAFC picks up on a pathetic presentation by Cimline.

The district court determined that Cimline failed to offer sufficient evidence of obviousness necessary to satisfy its burden of demonstrating a genuine issue of material fact to survive summary judgment. In particular, the district court noted that Cimline did "little more than point to the products Crafco sold in the 1980s and PennDOT's modifications and then assert, in a conclusory fashion, that the '375 patent must have been obvious in light of those products." Cimline, 672 F. Supp. 2d at 925. Though the issue of obviousness was scantly briefed to the district court, the parties' oral argument to this court focused primarily on the obviousness issue, with the parties agreeing that there are no material issues regarding the underlying factual inquiries on the legal determination of obviousness. See, e.g., Oral Argument at 4:27- 48, available at http://oralarguments.cafc.uscourts.gov/Audiomp3/2010-1348.MP3. We agree that there are no genuine issues of fact regarding the underlying factual inquiries of the obviousness analysis and address each factor in turn.

The reason that oral argument before the CAFC panel "focused primarily on the obviousness issue" was because the panel already had that in their sights. The oral arguments are a rude gem of rummy rhetoric, as CAFC Judge Prost notes.

The scope and content of the prior art and the differences between the prior art and the claims at issue are not in dispute. The prior art includes sealant melters built by Crafco in the 1980s and sold to the Texas Department of Transportation. Those sealant melters included splash boxes and manual conveyor belts. Likewise, the sealant melters modified by PennDOT in the mid-1990s included splash boxes and manual conveyor belts. The prior art also includes powered conveyor belts like those used in the mining industry. Mr. Barnes, the named inventor of the '375 patent, testified that powered conveyor belts existed for perhaps as many as seventyfive years. When compared to the prior art, the asserted claims of the '375 patent differ in only one way: the use of a powered conveyor controlled by a switch. Though Crafco asserts that the splash box limitations of claim 23 also differentiate its invention from the prior art, the testimony of inventor Barnes indicates that the splash box of the PennDOT sealant melter was the same as the splash box of the '375 patent.

There is no dispute regarding the level of ordinary skill in the art. Further, the parties do not dispute any evidence regarding secondary considerations. For instance, at oral argument, Cimline was questioned regarding the existence of factors such as long felt need and the delay in combining powered conveyor belts with sealant melters. Oral Argument at 5:28-7:00. Crafco, however, offered no response to Cimline's answers. Thus, no issue of fact exists regarding the underlying factual inquiries of the obviousness analysis.

While its argument base was thin, Cimline stated the implication of a simple combination.

Cimline argues that the '375 patent is obvious because it discloses an invention that is merely the combination of prior art sealant melters--having manual conveyor belts and splash guards--with powered conveyor belts. Citing the report of its expert, Cimline argues that powered conveyor belts were in the prior art since at least the 1980s and for at least seventy-five years, according to the inventor of the '375 patent. Cimline contends that Crafco's combination of prior art sealant melters with a powered conveyor belt yielded nothing "more than the predictable use of prior art elements according to their established functions." KSR, 550 U.S. at 417. Also, Cimline argues that the district court incorrectly suggested that "the focus instead must be on whether there exists 'a reason that would have prompted a person of ordinary skill in the relevant field to combine' a powered conveyor with a sealant melter." Id. at 418; Appellant Br. at 38. Cimline further asserts that the district court erred in failing to apply common sense to determine that the combination of prior art sealant melters with powered conveyor belts is obvious.

Crafco responds that the district court correctly determined that Cimline offered "almost no evidence to support its allegations of obviousness." Appellee Br. at 8.

The lesson for Minnesota district court judge Richard H. Kyle, and all across the land: put common sense at hand. That's a tough lesson, because sense really isn't very common, as shown repeatedly in this blog.

As a preliminary matter, we find fault with the district court's reliance on pre-KSR decisions and its focus on whether there existed explicit teachings as to "a reason that would have prompted a person of ordinary skill in the relevant field to combine" a powered conveyor with a sealant melter. Cimline, 672 F. Supp. 2d at 926. The Supreme Court set forth a flexible inquiry in KSR, which allows for a court "to take account of 'the inferences and creative steps,' or even routine steps, that an inventor would employ." Ball Aerosol & Spec. Container v. Ltd. Brands, 555 F.3d 984, 993 (Fed. Cir. 2009). When taking these inferences and creative or routine steps into account, it may be proper to conclude that the result of a "combination [of prior art] would have been entirely predictable and grounded in common sense" under the proper set of facts. Id.

Our cases which have relied on "common sense" consistently teach that "factfinders may use common sense in addition to record evidence" to determine the legal issue of obviousness. Perfect Web Tech., Inc. v. InfoUSA, Inc., 587 F.3d 1324, 1329 (Fed. Cir. 2009); see also Wyers v. Master Lock Co., 616 F.3d 1231, 1239 (Fed. Cir. 2010); Ball Aerosol, 555 F.3d at 993. In bridging the gap between prior art references and a conclusion of obviousness, the factfinder may rely on the prior art references themselves, the knowledge of those of ordinary skill in the art, the nature of the problem to be solved, market forces, design incentives, the "interrelated teachings of multiple patents," "any need or problem known in the field of endeavor at the time of invention and addressed by the patent," or the background knowledge, creativity, and common sense of the person of ordinary skill. KSR, 550 U.S. at 418-21; see also Ruiz v. A.B. Chance Co., 234 F.3d 654, 665 (Fed. Cir. 2000).

Sealing the patent's fate...

The combination of prior art sealant melters having a manual conveyor belt with a powered conveyor belt requires nothing more than common sense to appreciate the resultant advantage. The claimed invention of the '375 patent represents no more than "the predictable use of prior art elements according to their established functions." KSR, 550 U.S. at 417. Further, it is clear that a person of ordinary skill would have perceived a reasonable expectation of success in the combination of these two elements of the prior art. See In re O'Farrell, 853 F.2d 894, 904 (Fed. Cir. 1988) ("For obviousness under § 103, all that is required is a reasonable expectation of success."). None of Crafco's arguments to the contrary are convincing. The teachings of "common sense" in this case derive not only from the nature of the problem to be solved, but also from market forces themselves. As to the nature of the problem to be solved, the record evidence shows that it is common sense that an object, such as coal, can travel along a powered conveyor and will stop when the power to the conveyor is turned off. J.A. 384-86. As to market forces, these are clearly evidenced by the sales meeting and production request that PennDOT made of Crafco after Crafco witnessed PennDOT's modifications to early Crafco sealant melters.

It's always a dangerously obvious predicament for a patent holder when the technology is readily understood, as in: put a conveyer belt onto something that needs to be conveyed. The only thing this panel ruling missed in comment about experts was Bob Dylan ("you don't need a weatherman to know which way the wind blows...").

Crafco's argument that the district court correctly found a lack of evidence as to obviousness and properly discounted the evidentiary value of Cimline's expert report is likewise unavailing. The obviousness analysis may "include recourse [by the factfinder] to logic, judgment, and common sense available to the person of ordinary skill that do[es] not necessarily require explication in any reference or expert opinion." Perfect Web, 587 F.3d at 1329. By extension, expert reports--even credible experts reports--are not required when the underlying factual considerations are resolved by resort to common sense. Here, the technology is easily understandable, even without the assistance of expert opinion. Centricut, LLC v. Esab Group, Inc., 390 F.3d 1361, 1369 (Fed. Cir. 2004). Thus, the district court erred in concluding that a lack of evidence existed as to the underlying factual considerations of the obviousness analysis. Cimline, 672 F. Supp. 2d at 926-27. The court further erred in applying the heightened burden placed on expert reports opining as to obviousness by Innogenetics. 512 F.3d at 1363 (requiring a heightened burden of explanation in an expert report regarding motivation to combine references for a technology involving the detection and classification of hepatitis C genotypes in a biological sample). Our cases distinguish the need for and breadth of required expert disclosure when the underlying technology is "easily understandable." Compare Perfect Web, 587 F.3d at 1329-30 with Innogenetics, 512 F.3d at 1363.

While unnecessary in an obviousness analysis where the factual inquiries are resolved by application of common sense, Perfect Web, 587 F.3d at 1329, we note that Cimline's submitted expert report in this case acknowledges that conveyors are nothing new in the industry and powering a conveyor is something that has been done in the past and is not technically difficult to accomplish. We agree. The automation of mechanical equipment once operated manually is commonplace and reasonably obvious to one of ordinary skill. See, e.g., Leapfrog Enters. v. Fisher-Price, Inc., 485 F.3d 1157, 1161 (Fed. Cir. 2007) ("Accommodating a prior art mechanical device . . . to modern electronics would have been reasonably obvious to one of ordinary skill . . . ." and "has been commonplace in recent years."). This evidence fully supports our conclusion that the '375 patent is invalid for obviousness.

A gratuitous slap at Cimline for lame lawyering of a winning case.

This case presents the rare procedural occurrence in which the Appellant, Cimline, failed to file a cross-motion for summary judgment in response to Crafco's motion for summary judgment. The parties have had an opportunity to be fully heard, however, and there are no disputed issues of material fact regarding obviousness. Thus, the legal determination of obviousness is amenable to complete adjudication upon appellate review and we exercise our authority and discretion to decide this case in the interest of judicial economy. See Brown v. J.B. Hunt Transp. Servs., Inc., 586 F.3d 1079, 1088 n.6 (8th Cir. 2009) (disposing of appellant's claims on appellate review despite appellant's failure to file a cross-motion for summary judgment, where the facts were undisputed); 28 U.S.C. § 2106.

We conclude that it is a matter of common sense to combine a prior art sealant melter with a powered conveyor to create the sealant melter claimed in the '375 patent. The intended results achieved by this combination would be perceived as having a reasonable expectation of success to a person of ordinary skill. Therefore, the district court's dismissal with prejudice of Cimline's invalidity and noninfringement counts in its Amended Complaint is vacated. The district court's entry of stipulated damages and an injunction against Cimline is also vacated. The court's grant of summary judgment in favor of Crafco on validity and infringement is reversed. We affirm-in-part the district court's summary determination as to Cimline's antitrust and unfair competition claims. Judgment is entered in favor of Cimline on its invalidity and noninfringement counts because we hold that the '375 patent is invalid.