Patent Law Developments in the United States Court of Appeals for the Federal Circuit During 1992
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PATENT LAW DEVELOPMENTS IN THE UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT DURING 1992 KENDREW H. COLTON* MICHAEL W. HAAS** TABLE OF CONTENTS Introduction ................................................ 911 I. Jurisdiction, Procedure, and Practice ................. 912 A. Jurisdiction of the Federal Circuit ............... 912 1. The Federal Circuit's appellate jurisdiction... 912 2. Perfection of Federal Circuit jurisdiction- Rule 54(b) .................................. 919 B. Declaratory Judgments .......................... 921 C. Standing and Mootness ......................... 924 D. General Civil Procedure Issues .................. 937 1. Waiver of inconsistent jury findings .......... 938 2. Amending a complaint ....................... 939 3. Law of the case doctrine ..................... 941 4. Timeliness of general-verdict-multiple- defense argument ........................... 942 E. Judicial Estoppel and Settlement Estoppel ....... 942 F. Standard of Review for Rule 50(b) Motions ...... 944 G. Jury Trials-Seventh Amendment ............... 944 H. The Attorney-Client Privilege ................... 946 * Partner, Cushman Darby & Cushman, Washington, D.C.: J.D., Case Western Re- serve University; B.A., Colby College. ** Associate, Cushman Darby & Cushman, Washington, D.C.: J.D., University of Pitts- burgh School of Law; B.S.E.E., Ohio Northern University. The authors gratefully acknowledge the contributions and assistance provided by Adam R. Hess, Harlan B. Williams, Thomas M. Blasey, and Kenneth R. Corsello. 909 910 THE AMERICAN UNIVERSITY LAW REVIEW [Vol. 42:909 I. Sovereign Immunity-Eleventh Amendment ..... 947 J. Frivolous Appeals Under Rule 38 of the Federal Rules of Appellate Procedure ................... 948 K. Modifying Consent Decrees ..................... 950 II. Patentability and Validity ............................ 953 A. Patentable Subject Matter-35 U.S.C. § 101 ..... 953 B. Anticipation-35 U.S.C. § 102 ................... 957 1. Public use and on-sale bars .................. 957 2. Prior printed publication .................... 962 3. Identity of invention and claim interpretation 962 4. Jury findings with respect to patent validity .. 965 5. Foreign patents as prior art .................. 966 C. Obviousness-35 U.S.C. § 103 .................. 967 1. Analogous prior art .......................... 967 2. Suggestion to combine or modify the prior art .......................................... 969 3. Secondary considerations .................... 975 4. Admissions as to obviousness ................ 976 5. Design patents .............................. 977 D. Enablement, Written Description, Best Mode- 35 U.S.C. § 112 ................................. 977 1. W ritten description .......................... 978 2. Enablement ................................. 980 3. Best m ode ................................... 981 4. Means-plus-function claims .................. 983 E. Inventorship and Derivation-35 U.S.C. § 116 and § 102(f) .................................... 986 1. Joint inventorship under 35 U.S.C. § 116 .... 986 2. Derivation of invention under 35 U.S.C. § 102(f) ..................................... 987 F. Double Patenting ............................... 988 1. Claim interpretation ......................... 988 2. Terminal disclaimers ........................ 991 G. New Matter-35 U.S.C. § 132 ................... 994 III. Interferences Under 35 U.S.C. § 135 ................. 995 A. Application of Interference Rules ............... 995 B. /Preclusive Effect of Interference Judgments ...... 1001 IV. Infringement-35 U.S.C. § 271 ...................... 1003 A. Claim Interpretation and Construction .......... 1003 1. Interpreting claim terminology ............... 1004 2. Prosecution history estoppel ................. 1011 B. Literal Infringement ............................ 1014 1993] 1992 AREA SUMMARY: PATENTS 1. Establishing literal infringement ............. 1014 2. Evidentiary considerations ................... 1018 C. Doctrine of Equivalents ......................... 1021 D. Design Patent Infringement ..................... 1023 E. Product-by-Process Claims ...................... 1025 F. Exceptions to Infringement ..................... 1032 1. Experimental use under 35 U.S.C. § 271(e) .. 1032 2. "Crop exemption" under 7 U.S.C. § 2543 ... 1034 V. Rem edies ............................................ 1037 A. Lost Profits-35 U.S.C. § 284 ................... 1037 B. Willful Infringement and Exceptional Cases-35 U.S.C. § 284 and § 285 ......................... 1039 C. Design Patents-35 U.S.C. § 289 ................ 1047 D. Limitations on Damages-35 U.S.C. § 286 ....... 1048 E. Injunctions-35 U.S.C. § 283 ................... 1050 1. Preliminary injunctions ...................... 1050 2. Modifying permanent injunctions ............ 1052 VI. Equitable Defenses to Patent Infringement ........... 1053 A. Laches and Equitable Estoppel .................. 1053 B. Fraud and Inequitable Conduct ................. 1062 C. Patent Misuse ................................... 1067 INTRODUCTION During its 1992 term, the U.S. Court of Appeals for the Federal Circuit considered a broad range of patent-related subjects ranging from its appellate jurisdiction to equity-based factors affecting pat- ent enforceability. For the most part, the court preserved the status quo and continued to apply well-established patent law principles in reaching its decisions. However, there have been a number of inter- esting cases that have served to clarify for the practitioner various principles of patent law, such as the laches and equitable estoppel defenses to patent infringement. The court has also confronted new issues involving exemptions to patent infringement. Finally, the court's effort to grapple with certain jurisdictional and claim inter- pretation issues demonstrates that there will be more interesting de- cisions to come in succeeding years. This Article provides an overview of the 1992 Federal Circuit de- cisions in the area of patent law, highlighting the more significant aspects of those cases. For the purpose of discussion, the Article is divided into six major sections. Section I focuses on Federal Circuit decisions pertaining to its appellate jurisdiction, as well as practice before the court. In Section II, the discussion summarizes the Fed- 912 THE AMERICAN UNIVERSITY LAW REVIEW [Vol. 42:909 eral Circuit decisions relating to patentability and validity issues. Section III deals with interference practice and the effect of interfer- encejudgements. Section IV presents selected aspects of 1992 Fed- eral Circuit patent infringement decisions. Section V discusses the court's rulings on remedies for patent infringement. Finally, in Sec- tion VI, we conclude with a discussion of various Federal Circuit rulings involving application of equitable defenses to patent infringement. I. JURISDICTION, PROCEDURE, AND PRACTICE A. Jurisdiction of the Federal Circuit 1. The Federal Circuit's appellatejurisdiction The Federal Circuit has exclusive jurisdiction over an appeal from a final decision' or certain interlocutory orders or decrees2 of a dis- trict court if the jurisdiction of the district court was based, in whole or in part, on 28 U.S.C. § 1338.3 During the past year, the Federal Circuit announced no significant doctrinal shifts concerning its ap- pellate jurisdiction in patent cases. The Federal Circuit decisions show an acute awareness of the critical role § 1338 plays in its appel- late jurisdiction. Indeed, the Federal Circuit decisions suggest that the court will continue to review the basis for its appellate jurisdic- tion in accordance with established paradigms in ascertaining whether the district court from which an appeal is taken had juris- diction under § 1338. In Wang Laboratories,Inc. v. Applied Computer Sciences, Inc. ,4 the Fed- eral Circuit held that it had jurisdiction to enforce a patent infringe- ment settlement agreement because the district court retained jurisdiction under 28 U.S.C. § 1338(a) over the consent decree that concluded an earlier infringement action.5 The events leading to 1. 28 U.S.C. § 1295(a)(1) (1988) (providing that "Federal Circuit shall have exclusive jurisdiction of an appeal from a final judgement of a district court... if the jurisdiction of that court was based, in whole or in part, on section 1338"). 2. Id. § 1292(c)(1) ("Federal Circuit shall have exclusive jurisdiction of an appeal from an interlocutory order or decree over which ... the court would have jurisdiction of appeal under § 1295 .. "); id. § 1292(c)(2) ("Federal Circuit shall have exclusive jurisdiction of an appeal from a judgement in a civil action for patent infringement which would otherwise be appealable ... and is final except from an accounting."). 3. Id § 1338(a) (1988) ("District courts shall have original jurisdiction of any civil ac- tion arising under any Act of Congress relating to patents .... Such jurisdiction shall be exclusive of the courts of the states .... ). 4. 958 F.2d 355, 22 U.S.P.Q.2d (BNA) 1055 (Fed. Cir. 1992); see also infra notes 247-55 and accompanying text (discussing case with regard to judicial estoppel issue). 5. See Wang Lab., Inc. v. Applied Computer Sciences, Inc., 958 F.2d 355, 356, 22 U.S.P.Q.2d (BNA) 1055, 1056 (Fed. Cir. 1992) (reversing district court's enforcement of un- executed settlement agreement concerning patent infringement). 1993] 1992 AREA SUMMARY: PATENTS 913 the Federal Circuit's involvement in Wang began with Wang Labora- tories, Inc.'s 1986 patent infringement