Carborundum Co. v. Molten Metal Equipment Innovations, Inc.

72 F.3d 872, 37 U.S.P.Q. 2d (BNA) 1169, 1995 U.S. App. LEXIS 35743, 1995 WL 749634
CourtCourt of Appeals for the Federal Circuit
DecidedDecember 19, 1995
DocketNos. 94-1298, 94-1342, 95-1015, 95-1024, 95-1032, 95-1033
StatusPublished
Cited by9 cases

This text of 72 F.3d 872 (Carborundum Co. v. Molten Metal Equipment Innovations, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Federal Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Carborundum Co. v. Molten Metal Equipment Innovations, Inc., 72 F.3d 872, 37 U.S.P.Q. 2d (BNA) 1169, 1995 U.S. App. LEXIS 35743, 1995 WL 749634 (Fed. Cir. 1995).

Opinion

LOURIE, Circuit Judge.

Molten Metal Equipment Innovations, Inc. and Paul V. Cooper (collectively “MMEI”) appeal from the decisions and orders of the United States District Court for the Northern District of Ohio in which the court entered a permanent injunction against MMEI based on a jury verdict of infringement of U.S. Patent 4,169,584 (the ’584 patent), which is owned by the Carborundum Company d/b/a Metaullics Systems Division and Me-taullics Systems Co. L.P. (collectively “Me-taullics”); granted Metaullics’ motion for judgment as a matter of law on MMEI’s implied license defense; denied MMEI’s motion to modify the permanent injunction; and held MMEI in civil contempt for violation of the court’s injunction. Carborundum Co. v. Molten Metal Equip. Innovations, Inc., No. 1:92 CV 2106 (N.D.Ohio April 21, 1994) (issuing permanent injunction against MMEI); Carborundum Co. v. Molten Metal Equip. Innovations, Inc., No. 1:92 CV 2106 (N.D.Ohio April 22, 1994) (granting judgment as a matter of law for Metaullics on MMEI’s implied license defense); Carborundum Co. v. Molten Metal Equip. Innovations, Inc., No. 1:92 CV 2106 (N.D.Ohio May 4, 1994) (denying MMEI’s motion to modify the permanent injunction); Carborundum Co. v. Molten Metal Equip. Innovations, Inc., No. 1:92 CV 2106 (N.D.Ohio September 6, 1994) (holding MMEI in civil contempt). Metaul-lics cross-appeals, challenging the amount of damages awarded based on the court’s contempt finding. We affirm.

BACKGROUND

Metaullics manufactures and sells equipment used in various systems in the aluminum industry, including molten metal purification systems. These purification systems introduce gases into molten metal in order to remove dissolved gases, such as hydrogen, or dissolved metals, such as magnesium, from the molten metal. These gases chemically react with the impurities to form a compound that either floats to the surface of the molten metal and is skimmed off or is released from the molten metal into the atmosphere.

Metaullics owns the ’584 patent for a “Gas Injection Apparatus,” which issued on October 2, 1979.1 The invention is directed to a complete system for melting scrap metal and removing impurities from the metal. Me-taullics does not have a patent on any of the individual elements of the claimed system. Claim 1, the only independent claim at issue, defines the invention as follows:

1. A gas injection apparatus for introducing gas into molten metal, comprising:
(1) a reverberatory furnace;
(2) means within said reverberatory furnace for pumping metal through a metal transfer conduit, said pumping means having a pumping capacity of at least 4000 lbs/min, said metal transfer conduit being at least partially submerged in a metallic bath;
(3) a two-ended gas injection conduit having one end submerged within the metallic bath and connected to the metal transfer conduit, the gas injection conduit being so constructed and arranged that the metal is pumped past the submerged end of the gas injection conduit so as to contact the gas within the gas injection conduit connected to the metal transfer conduit, the gas injection conduit having an unsubmerged end opposite the submerged end of the gas injection conduit; and
(4) means for providing gas to be introduced into the molten metal into the [876]*876unsubmerged end of the gas injection conduit.

Instead of selling the entire apparatus as claimed in the ’584 patent, Metaullies sells a pump with a metal transfer conduit and a gas injection conduit. The pump is designed specifically for use in the system described in the ’584 patent. Metaullies does not sell a reverberatory furnace or a gas supply. When it sells its pump, Metaullies does not provide any notice of the ’584 patent or place any restrictions on its customers’ use of the pump.

In addition to selling pumps, Metaullies sells replacement parts for its pumps. Because a portion of the pump is submerged in molten metal, certain parts of the pump must be made of a nonmetallic material, such as graphite or ceramic. Although these parts are more durable in molten metal than metal parts, they still require frequent replacement. In fact, Metaullies estimates that it costs about $35,000.00 a year in replacement parts for a pump that initially cost between $8,000.00 and $20,000.00.

MMEI also sells molten metal pumps, the “WORKHORSE” and “MONSTER” pumps, and replacement parts for those pumps.2 Most of MMEI’s pump sales in this ease were to customers who previously purchased a Metaullies pump and then replaced it with an MMEI pump.3 MMEI does not dispute that Metaullies’ customers substituted the MMEI pump for the Metaullies pump and continued to use the apparatus of the ’584 patent.

On October 7, 1992, Metaullies sued MMEI, alleging that the sale of MMEI’s pumps constituted contributory infringement and inducement of infringement under 35 U.S.C. §§ 271(b) and (c) (1988). Beginning on April 5, 1994, the court held a bifurcated trial in which the issues of infringement and damages were tried separately to the same jury. At the close of the evidence in the liability phase of the trial, Metaullies moved for judgment as a matter of law on MMEI’s defense that its customers did not directly infringe the ’584 patent.4 See Fed.R.Civ.P. 50. The court granted Metaullies’ motion and directed a verdict in favor of Metaullies on MMEI’s implied license defense. Carborundum, Co. v. Molten Metal Equip. Innovations, Inc., No. 1:92 CV 2106 (N.D.Ohio April 22, 1994). In particular, the court held that Metaullies’ initial sale of a pump did not grant its customers an implied license to use the apparatus of the ’584 patent for the life of the patent. Id., slip op. at 3. The court determined that when Metaullies sold a pump, the customer received an implied license under the ’584 patent for the life of the purchased pump. Id., slip op. at 5. Therefore, the court held that Metaullies’ customers would infringe the ’584 patent when they placed MMEI’s pump into their metal purification systems.

The jury then returned a verdict finding MMEI liable for contributory infringement and inducement to infringe independent claim 1 and dependent claims 4, 5, 6, 7, and 8. Before the damages phase of the trial, the court entered a permanent injunction pursuant to the jury’s verdict. Carborundum Co. v. Molten Metal Equip. Innovations, Inc., No. 1:92 CV 2106 (N.D.Ohio April 20, 1994). The injunction prevented MMEI from selling any pumps or replacement parts for those pumps used in infringing systems. Id., slip op. at 2. In response to concerns that MMEI’s customers would be unable to immediately convert their systems to noninfring-ing systems, the court modified the injunction to allow MMEI to sell replacement parts during a two-week grace period until May 4, 1994. Carborundum Co. v. Molten Metal Equip. Innovations, Inc., No. 1:92 CV 2106 (N.D.Ohio April 21, 1994). However, the court explicitly admonished the president of MMEI that “extending this time did not [877]*877mean that [the court] was condoning him ... to unload all of his graphite parts on [MMEI’s customers] between now and May 4th.”

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72 F.3d 872, 37 U.S.P.Q. 2d (BNA) 1169, 1995 U.S. App. LEXIS 35743, 1995 WL 749634, Counsel Stack Legal Research, https://law.counselstack.com/opinion/carborundum-co-v-molten-metal-equipment-innovations-inc-cafc-1995.