Heil Co. v. Snyder Industries, Inc.

763 F. Supp. 422, 18 U.S.P.Q. 2d (BNA) 2022, 1991 U.S. Dist. LEXIS 6024, 1991 WL 70487
CourtDistrict Court, D. Nebraska
DecidedApril 19, 1991
DocketCV88-L-671
StatusPublished
Cited by3 cases

This text of 763 F. Supp. 422 (Heil Co. v. Snyder Industries, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Nebraska primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Heil Co. v. Snyder Industries, Inc., 763 F. Supp. 422, 18 U.S.P.Q. 2d (BNA) 2022, 1991 U.S. Dist. LEXIS 6024, 1991 WL 70487 (D. Neb. 1991).

Opinion

MEMORANDUM AND ORDER ON DEFENDANT’S MOTION TO STRIKE

URBOM, Senior District Judge.

The plaintiff, the Heil Company, has filed this civil action pursuant to 35 U.S.C. § 146 complaining of the decision of the United States Patent and Trademark Office Board of Patent Appeals and Interferences (“Board”). In that proceeding the Board decided that the plaintiff’s assignor, Fred Smith, was not entitled to the patent because (1) the container invention had been offered for sale more than one year prior to the filing date of Smith’s application; and (2) that Snyder was entitled to prevail on the issue of priority of invention because Smith had not satisfied his burden of proving prior inventorship. The plaintiff contends that its assignor is entitled to priority of invention and a patent containing claims corresponding to the Interference Count.

At trial the plaintiff sought to introduce evidence which had not been presented to the Board during the Interference. The court permitted the evidence to be presented but reserved ruling on its admissibility. The plaintiff relies on the statutory language of section 146 to support admission of the additional evidence. The defendant, on the other hand, argues that various circuit courts have applied section 146 to exclude additional testimony if it was deliberately withheld from the Board or overlooked due to a lack of due diligence.

I. Limitations on New Evidence in Section US Proceedings

Section 146 provides:

“Any party to an interference dissatisfied with the decision of the Board of Patent Appeals and Interferences on the interference, may have remedy by civil action.... In such suits the record in the Patent and Trademark Office shall *424 be admitted on motion of either party upon the terms and conditions as to ... further cross-examination of the witnesses as the court imposes, without prejudice to the right of the parties to take further testimony.”

35 U.S.C. § 146 (1990). On its face, the statute authorizes testimony in addition to that presented to the Board. However, in the past, various circuit courts introduced limitations on the testimony which could be later admitted. The particular limitation recognized by the Eighth Circuit required exclusion of additional testimony which was deliberately, intentionally, or willfully withheld or suppressed from the Board. Kirschke v. Lamar, 426 F.2d 870, 874 (8th Cir.1970). According to the court:

“[T]he viability of the administrative process presupposes that pertinent and available testimony will be presented before the appropriate administrative body. The provision does not mean that a party can have free rein to look the other way at the administrative proceeding and then throw all its evidentiary eggs into the judicial basket in a § 146 suit.”

Id.

Nevertheless, Eighth Circuit law is not controlling in this case; rather, the Court of Appeals for the Federal Circuit has exclusive jurisdiction over appeals of section 146 district court decisions. 28 U.S.C. § 1295(a)(4)(C). The Federal Circuit was born, at least in part, from the need to provide “a new forum for the definitive adjudication of selected categories of cases” based upon topical, rather than geographical, jurisdiction. Federal Courts Improvement Act of 1982, S.Rep. No. 275, 97th Cong., 1st Sess., reprinted in 1982 U.S.Code Cong. & Admin.News 11. The legislative history of this act reveals the justification for exclusive jurisdiction in this area of the law:

“The establishment of the Court of Appeals for the Federal Circuit also provides a forum that will increase doctrinal stability in the field of patent law.... [T]he Hruska Commission singled out patent law as an area in which the application of the law to the facts of a case often produces different outcomes in different courtrooms in substantially similar cases. Furthermore, in a commission survey of practitioners, the patent bar indicated that uncertainty created by the lack of national law precedent was a significant problem, and the Commission singled out patent law as an area in which widespread forum-shopping is particularly acute.
The creation of the Court of Appeals for the Federal Circuit will produce desirable uniformity in this area of the law. Such uniformity will reduce the forum-shopping that is common to patent litigation ....
Likewise, uniformity in the law will be a significant improvement from the standpoint of the businesses that rely on the patent system.”

Id. Therefore, although it is perfectly proper for the Federal Circuit to consider the rules articulated in other circuits, it is in no way bound to adopt those rules. In order to fulfil its purpose, the Federal Circuit must apply one rule across all cases regardless of the district within which the case arose. It is apparent that a rule previously announced and applied by the Eighth Circuit is of no consequence if the Federal Circuit has adopted a different rule.

A rule applicable to this issue was announced by the Federal Circuit in Case v. CPC International, Inc., 730 F.2d 745 (Fed.Cir.), cert. denied 469 U.S. 872, 105 S.Ct. 223, 83 L.Ed.2d 152 (1984). In that case, the plaintiff asked that testimony not presented to the board be barred in the district court in light of the Eighth Circuit rule that “a deliberate, intentional or willful withholding or suppression of pertinent and available evidence from the Patent Office ... justifies exclusion of such evidence in a [35 U.S.C.] § 146 proceedings.” Id. at 752, citing Kirschke v. Lamar, 426 F.2d 870, 874 (8th Cir.1970). The dispute involved testimony of an expert witness who had not appeared before the board.

The Federal Circuit refused to bar the testimony, stating:

*425 “The provision of 35 U.S.C. § 146 which provides for review of the Board of Interferences by civil action in a district court explicitly states that the administrative record may be admitted ‘without prejudice to the right of the parties to take further testimony.’ We are aware that this provision has received varying interpretations in the circuits. In our view, since an action under 35 U.S.C. § 146

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Bluebook (online)
763 F. Supp. 422, 18 U.S.P.Q. 2d (BNA) 2022, 1991 U.S. Dist. LEXIS 6024, 1991 WL 70487, Counsel Stack Legal Research, https://law.counselstack.com/opinion/heil-co-v-snyder-industries-inc-ned-1991.