General Mills v. Kraft Foods (Fed. Cir. 2007).
Fruit by the Foot is similar the more popular Fuit Roll Up. The product is essentially three-feet of mashed fruit mixed with corn-syrup. General Mills patented this new food (U.S. Patent No. 5,723,163) and then sued Farley Candy Company for infringement. The Farley case settled with an agreed lump-sum payment for General Mills and a covenant not to sue Farley or its successors on the patent. The settlement includes a provision that successors only have rights under the agreement if the entire business is transferred.
After the settlement, Kraft purchased Farley’s entire business, properly becoming a successor under the agreement. Kraft then sold-off most of Farley’s business to a third party, but attempted to hold-on to its right of continued infringement. General Mills then sued for infringement.
On appeal of a R.12(b)(6) dismissal, the CAFC gave a literal interpretation to the settlement agreement: First finding that Kraft had properly become a successor based on its purchase of the entire Farely business. Then, because the agreement did not specifically address the issue of divestiture of assets, the court held that Kraft maintained its right to infringe despite selling the Farley assets.
Dismissal affirmed
Notes:
- The case also includes a Civil Procedure gem for those of you thinking about responding to an amended complaint:
Here, the court held that a response to an amended complaint is still due within 10-days regardless filing of a R.12(b)(6) motion to dismiss. R.12(a)(1) and (a)(2) provide the rules regarding timing of responive pleadings; R.12(a)(4) allows a delay in filing a responsive pleading under certain conditions; and R.15 provides a 10-day window for responding to amended complaints in particular. The opinion focused on the the phrase “these periods of time” to limit the delay provision of 12(a)(4) so that it only applies the timing provisions of Rule 12 (and not Rule 15).
“Rule 12(a)(4) then provides that “[u]nless a different time is fixed by court order, the service of a motion permitted under this rule [including a Rule 12(b)(6) motion to dismiss] alters these periods of time” so as to extend the deadline until a motion is ruled upon. Fed. R. Civ. P. 12(a)(4) (emphasis added). However, the time for answering an amended complaint is not one of “these periods of time.” Rather, the deadline for responding to an amended complaint is established separately under Rule 15: “A party shall plead in response to an amended pleading within the time remaining for response to the original pleading or within 10 days after service of the amended pleading, whichever period may be the longer, unless the court otherwise orders.” Fed. R. Civ. P. 15(a).”
This decision confused me because the phrase “these periods of time” is not found in my version of Rule 12(a)(4). Rather, my version discusses “the periods of time . . . [for] responsive pleading,” which might then include a response to an amended complaint under Rule 15. As you can see below, my version is different than the CAFC’s! In the future, differences will be corrected by the Supreme Court’s upcoming amendment: Effective December 1, 2007, Rule 12 will be amended to “these periods.”
Various sources have different versions of the rule:
- Cornell Online Version: “the periods of time.”
- USCS Fed Rules Civ Proc R 12 (Lexis): “the periods of time.”
- Federal Rules (Thompson West 2005 Rev. Ed.): “these periods of time.”
- Federal Rules (Westlaw 2007): “these periods of time.”
- All cases found in Lexis & Westlaw cite to the rule as “these periods of time.”
Joi, sorry, no time at the moment for a full exposition on PSA. In a nutshell, you use an after the fact search to find a prior publication that would have represented a “realistic starting point” for a PHOSITA at the relevant date who was attacking the prior art deficiency identified by the inventor in his/her (before the fact) appln. Then compare the claim being put forward for issue with the disclosure of that single reference. Debate obviousness in the gap between those two fixed points. Conversely, in every other obviousness system, you debate the claim relative to the unfocussed ocean of the state of the art, so there’s no defined “gap” and the debate can go on for as long as your resources allow. There’s much more but other matters intrude.
“By the way, that happened to the picture of Sgt. Crouch with the stare that could melt steel?”
He has abandoned private practice for the sheltered workshop that is academia and is much more relaxed already.
Re: Contemporaneous Evidence et al.
MaxD, and I too agree with you. I think it is well settled and as of yet undisturbed by our Supremes that the best [maybe only?] evidence regarding obviousness would be contemporaneous-with-the-invention evidence (KSR mucked up things a bit but at least it did not disturb “at the time of the invention”).
Regarding affidavits: whether contemporaneous or not, affidavits from “professional” experts are like affidavits from any other henchmen for hire, they would swear to anything they are paid to swear to if they could get away with it.
Evidence, of course, needs to be something more than such affidavits.
In this vein, I’ll note that, in my limited experience, I have seen just how important it is at trial to have at least one credible witness. Nothing substitutes for a credible witness. Judges can smell phonies. That’s why they are called Judges. I saw your comment about juries and have a question: Would you think juries for the most part can sort out who to believe?
Insofar as I understand the EPO’s Problem and Solution Approach to which you refer, it sounds very much like the CAFC’s TSM test just as you suggested on May 6th. I’m a big fan of the CAFC’s TSM. I plan to read your PSA comment again. Soo much information on PatentlyO, soo little time.
Excluding “ex post facto analysis” to rule out hindsight is, of course, a good thing. But, given the observer effect, for example, it is difficult or impossible to stand clear of hindsight. After all, invention makes the non-obvious obvious — everything is obvious after it has been invented, at least to inventors. Evidence, hard evidence, evidence one way or the other, is the only way to go.
Yes, I look forward to your edifying, interesting and well written comments. Thank you.
Oh, JOI, I could not agree with you more, on the need for evidence, in order to settle obviousness objectively. The best evidence would be contemporaneous evidence, right, rather than that of affidavits crafted long after the event. The EPO Problem and Solution Approach proceeds on the exclusive basis of documents created before the date of the claim, and rigorously excludes ex post facto analysis. Can I therefore put you down as a supporter?
MaxDrei,
Copy that. Subjectively speaking,
“…when it comes to faces [and obviousness], we each see what we want to see.”
That is why some objective test is needed to determine obviousness, like evidence that speaks to obviousness or evidence that speaks to non-obviousness.
As to Dennis’s photo, great smile – winning, warm, rare qualities for a patent lawyer.
As to the photo of all-seeing Blogmeister Crouch, I like the new relaxed manifestation (goes with Missouri, maybe), but I think he is too modest, in depicting himself as having only one eye (or is that to fit with the title of the blog?). Malcolm, I didn’t find the previous two-eyed look to be in the nature of a stare that could melt steel but maybe, when it comes to faces, we each see what we want to see.
“How is it that Fruit Roll Ups do not anticipate or at least make obvious Fruit by the Foot?”
Did Farley even apply for patent protection? Naturally, if they didn’t apply for a patent on a Fruit-by-the-Foot-knock-off, then the issue of anticipation would never arise.
Anon E. Moose, I’m so glad you noticed that cite to oral argument audio. I’ve been wondering about whether it would proper to cite counsel’s admissions at oral argument, given that there is no longer any transcript.
Has anyone seen in a Supreme Court petition, brief or opinion a citation to the audio of an oral argument?
“How is it that Fruit Roll Ups do not anticipate or at least make obvious Fruit by the Foot?”
No one could have predicted the potent laxative effects of Fruit by the Foot.
By the way, that happened to the picture of Sgt. Crouch with the stare that could melt steel?
How is it that Fruit Roll Ups do not anticipate or at least make obvious Fruit by the Foot? No, I didn’t read the prosecution history, I’ll let someone else here do that and summarize it for me.
As for the Civil Procedure question, the decision seems very odd (at best). Imagine a scenario in which an amended complaint is served 15 days after service of the original complaint, and before any answer to the original complaint has been served. The CAFC opinion seems to suggest that this automatically kicks everything over to Rule 15, and 12(a)(4) would no longer apply. Thus, even if a motion to dismiss is served within 10 days of service of the amended complaint, the defendant must nevertheless serve an answer within the time limit set by Rule 15 (i.e., within 10 days of service of the amended complaint). At best, this CAFC opinion could be interpreted to mean that 12(a)(4) would toll the deadline for serving an answer to the amended complaint, but only if the motion to dismiss is served within 5 days after service of the amended complaint (i.e., within the time period remaining for answering the original complaint).
Is this the first opinion that cites to the oral argument by time stamp of the recorded audio vice a page of the transcript? Kudos to Judge Linn’s chambers for embracing the power of technology to make a point. Shadow of Scott v. Harris?
The decision with respect to successor rights under the Settlement Agreement seems rather unremarkable to me. Kraft purchased the entirety of Farley’s business, and thus stepped into the shoes of Farley with respect to that Settlement Agreement. While Kraft later sold off much of the original Farley assets to Catterton, the opinion states that “it appears to be undisputed that Kraft retained at least some portion of the original Farley assets and of Farley’s rolled food business.” And, perhaps most importantly, General Mills did not assert that Kraft transferred its rights under the Settlement Agreement to Catterton – in fact, the opinion indicates that there was little evidence of what assets were even transferred by Kraft to Catterton (other than “goodwill and trademarks”). Since Farley was free to sell off some of its assets and retain rights under the Settlement Agreement, Kraft was entitled to do the same thing.
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