Meyer Intellectual Properties Limited v. Bodum, Inc. (Fed. Cir. 2012) Panel: Dyk (concurring), Moore, O'Malley (author) Download 11-1329
At its heart, Meyer v. Bodum is essentially an obviousness case, although for reasons having to do with the procedural posture, the court never gets to the merits of that issue, instead remanding the case for further proceedings based on numerous errors committed by the district court, which the opinion portrays as misguided and lacking an understanding of the basics of patent law.
Judge Dyk's concurrence, reproduced in its entirety at the end of the post, goes even further, concluding that "this case is an example of what is wrong with our patent system…Such wasteful litigation does not serve the interests of the inventorship community, nor does it fulfill the purposes of the patent system." Slip Op. at 46-47.
Background: Frank Brady was an independent sales representative for Bodum from 1986-1996, during which time he marketed and sold products including Bodum's French press coffee makers. In the mid-1990's, Brady came up with the idea of a milk frother that used aeration instead of steam, and in 1996, he filed a patent application directed to a "Method for Frothing Liquids" that led to two issued patents, Nos. 5,780,087 and 5,939,122. The claims essentially involve four steps: "(1) providing a container that has a height to diameter aspect ratio of 2:1; (2) pouring liquid (e.g., milk) into the container; (3) introducing a plunger that includes at least a rod and plunger body with a screen; and (4) pumping the plunger to aerate the liquid." Slip Op. at 5. Brady also sold milk frothers through his company, BonJour, which was subsequently sold to Meyer.
In 1999, Bodum began selling the first generation of its accused milk frothers. The figures accompanying this post are the opinion's comparisons of Bodum's Version 1 frother with the '087 patent. Shortly after Meyer filed an infringement suit in 2006, Bodum changed its designs, removing the spring element holding the screen against the inside wall of the container and replacing it with an O-ring. The O-ring was later removed to create the Version 3 frother.
Following a jury trial in which the jury held the patents to be valid and willfully infringed, awarding $50,000 in damages, the district court trebled the damages, declared the case exceptional, and awarded Meyer its attorney fees of $756,487,56. Bodum appealed, alleging a panopoly of errors by the district court. The Federal Circuit agreed.
Infringement: The CAFC vacated the district court's grant of summary judgment of infringement due to a lack of any evidence of direct infringement in the record. Rather, the district court relied only on assumptions of direct infringement. "We find it troubling that the district court based its direct infringement analysis on what it assumed happened, rather than on actual evidence of record. This assumption contradicts our well-established law that a patentee must prove infringement by a preponderance of the evidence." Slip Op. at 26.
Evidentiary Rulings: Prior to and during trial, the district court made a number of evidentiary rulings that sharply limited Bodum's ability to present its case. In an uncommon move, the Federal Circuit concluded that the district court had abused its discretion in these rulings, holding that (1) the district court erroneously limited the scope of prior art to only two references (one of which was subsequently excluded), despite sufficient disclosure of several additional references; (2) the district court erroneously excluded Bodum's expert from testifying despite a report containing a sufficiently detailed statement of his opinions and the bases for his conclusions, especially given the non-complex nature of the technology; and (3) the district court erroneously precluded lay witnesses from testifying to authenticate one of the two allowed prior art references. The CAFC thus remanded for a new trial on obviousness.
Inequitable Conduct: The CAFC also held that the district court erred by dismissing Bodum's inequitable conduct claims on a motion in limine. Under Seventh Circuit law, "a motion in limine is not the appropriate vehicle for weighing the sufficiency of the evidence." Slip Op. at 41-42. The district court thus "erred in addressing the sufficiency of Bodum's inequitbale conduct defense on an evidentiary motion." Id. at 42.
Willful Infringement and Enhanced Damages: Because the CAFC remanded the case for a new trial on infringement and invalidity, it vacated the wilfulness verdict and enhanced damages award. In doing so, it suggested that the district court use Bard Peripheral Vascular, Inc. v. W.L. Gore & Associates, Inc., 682 F.3d 1003 (Fed. Cir. 2012) (in which the Federal Circuit held that threshold "objective prong" of the willfulness inquiry is a question of law) as a starting point.
Judge Dyk's Concurrence: Writing in concurrence, Judge Dyk questioned why this patent issued in the first place and why it was not found obvious on summary judgment:
While I agree with and join the thorough majority opinion, in looking at this case from a broader perspective, one cannot help but conclude that this case is an example of what is wrong with our patent system. The patents essentially claim the use of a prior art French press coffee maker to froth milk. Instead of making coffee by using the plunger to separate coffee from coffee grounds, the plunger is depressed to froth milk. The idea of frothing cold milk by the use of aeration rather than steam is not new as reflected in the prior art Ghidini patent. Under the Supreme Court’s decision in KSR International Co. v. Teleflex, Inc., 550 U.S. 398, 420 (2007), and its predecessors, it would be reasonable to expect that the claims would have been rejected as obvious by the examiner, and, if not, that they would have been found obvious on summary judgment by the district court. But no such thing. The parties have spent hundreds of thousand of dollars and several years litigating this issue, and are invited by us to have another go of it in a second trial. Such wasteful litigation does not serve the interests of the inventorship community, nor does it fulfill the purposes of the patent system.
Judge Dyk specifically refers to the private costs of this litigation – the hundreds of thousands (at least a million, if both parties' costs are taken into account) of dollars spent by the parties on legal fees. The public, too, has spent a substantial amount of resources on this case: the district court's time and resources, the jury's time (and perhaps a future second jury), and the Federal Circuit's own time spent correcting the errors – as evidenced by its thorough 44-page opinion. Beyond these monetary costs, Judge Dyk's concurrence hints at an even greater public cost: the undermining of public confidence in the ability of the patent office and the courts to get patentability decisions on even relatively technologically simple inventions right.