In Re Convertible Rowing Exerciser Patent Litigation

721 F. Supp. 596, 12 U.S.P.Q. 2d (BNA) 1275, 11 I.T.R.D. (BNA) 1580, 1989 U.S. Dist. LEXIS 11409, 1989 WL 110483
CourtDistrict Court, D. Delaware
DecidedAugust 31, 1989
DocketMisc. 85-14
StatusPublished
Cited by3 cases

This text of 721 F. Supp. 596 (In Re Convertible Rowing Exerciser Patent Litigation) is published on Counsel Stack Legal Research, covering District Court, D. Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Convertible Rowing Exerciser Patent Litigation, 721 F. Supp. 596, 12 U.S.P.Q. 2d (BNA) 1275, 11 I.T.R.D. (BNA) 1580, 1989 U.S. Dist. LEXIS 11409, 1989 WL 110483 (D. Del. 1989).

Opinion

OPINION

LONGOBARDI, Chief Judge.

This opinion addresses an issue of first impression raised in a summary judgment motion by Defendants Ajay Enterprises Corporation and Weslo, Inc. in a dispute involving the alleged validity and infringement of U.S. Patent No. 4,477,071 (the “ ’071 patent”). The ultimate determination of the issue may affect the emerging patent litigation strategy of “testing the water” on patent validity, enforceability and infringement issues 1 before the International Trade Commission (“ITC”). The precise question before the Court is whether the determination of the ITC invalidating the ’071 patent, affirmed by the Court of Appeals for the Federal Circuit (“Federal Circuit”), 2 made relative to a determination that no violation of section 337 of the Tariff Act of 1930 (19 U.S.C. § 1337 (1982)) occurred, should be given preclusive effect in this Court despite the grant of original jurisdiction over patent matters placed in the District Courts under 28 U.S.C. § 1338 (1982). 3

BACKGROUND

In October, 1984, nine separate patent infringement actions were instituted in districts throughout the country. The Judicial Panel on Multidistrict Litigation thereafter referred to this District the original cases and four more cases involving the ’071 patent. The cases are now consolidated for pretrial proceedings. Plaintiffs are Diversified Products Corporation (“DP”) and Brown Fitzpatrick Lloyd Ltd. (“BFL”). The Defendants, each named in one of the actions, are Ajay Enterprises Corporation (“Ajay”), Allegheny International Exercise Company (“Allegheny”), Beacon Enterprises, Inc. and Saw Mill River Industries (“Beacon/Saw Mill”), Billard Barbell Company (“Billard”), Columbia Manufacturing Company (“Columbia”), Roadmaster, Inc. (“Roadmaster”), Rocket Industries, Inc. (“Rocket”), Walton Manufacturing Company (“Walton”) and Weslo, Inc. (“Weslo”). 4

On December 5, 1984, DP filed a Complaint with the ITC pursuant to 19 U.S.C. § 1337 (1982). The Complaint was amended twice. The Second Amended Complaint *598 alleged that Defendant Weslo committed acts of unfair trade practice in violation of section 337 by importing goods that infringe the ’071 patent. Weslo responded to the Complaint by asserting, inter alia, that the ’071 patent was invalid and not infringed. 5

The Administrative Law Judge (“ALJ”), after concluding all other aspects of an unfair trade practice had been established, held that the invention of the ’071 patent was anticipated and obvious in view of the prior art Beacon 3002 rowing machine. On review, the full Commission reversed the AU’s conclusion of anticipation but sustained the ALJ on all other grounds. In the Matter of Certain Convertible Rowing Exercisers, ITC Investigation No. 337-TA-212 (1985). DP appealed to the Federal Circuit for review of the obviousness finding of the ITC. The Federal Circuit in an unpublished opinion dealt exclusively with the obviousness issue. The appellate court affirmed the determination by the ITC that the ’071 patent was invalid and thus no violation of section 337 occurred. Diversified Products Corp. v. United States Intern. Trade Com’n, 824 F.2d 980 (Fed.Cir. 1987). 6

DISCUSSION

The Defendants argue that summary judgment on the issue of patent validity should be entered for them based upon the affirmance by the Federal Circuit of the ITC determination that the ’071 patent is invalid by reason of obviousness. Obviousness is a legal conclusion based on factual determinations and not a factual determination itself. Karlstads Mekaniska Werkstad v. ITC, 705 F.2d 1565 (Fed.Cir.1983). Defendants assert that the rule promulgated by the Supreme Court in Blonder-Tongue v. University Foundation, 402 U.S. 313, 91 S.Ct. 1434, 28 L.Ed.2d 788 (1971), bars Plaintiffs from relitigating the validity of the ’071 patent. In Blonder-Tongue, the Supreme Court held that once a court determines a patent is invalid in a proceeding where the patent owner had a full and fair opportunity to adjudicate, the patent owner is precluded from relitigating the validity of the patent against all others. Id. The Supreme Court thus eliminated the mutuality requirement in the use of collateral estoppel in cases finding patent invalidity.

Defendants also urge that the doctrine of “administrative res judicata ” prevents further judicial review of the ’071 patent. In United States v. Utah Constr. Co., 384 U.S. 394, 86 S.Ct. 1545, 16 L.Ed.2d 642 (1966), the Supreme Court held that findings of federal agencies shall be given pre-clusive effect when those agencies are acting in a judicial capacity. Id. at 422, 86 S.Ct. at 1560. Defendants argue the ITC is a federal agency; it acted in a judicial capacity in the proceeding declaring the ’071 patent invalid; therefore, the findings of the ITC in this matter should be *599 given preclusive effect. 7

Failure to grant preclusive effect to the Federal Circuit’s affirmance of the ’071 patent gives rise to prudential as well as practical problems. First, if the Court does not grant preclusive effect to the ITC determination that the ’071 patent is invalid, this Court might find, as the Canadian court found with the benefit of additional evidence, that the ’071 patent is not invalid. 8 This Court then would be placed in the awkward position of disagreeing with a Federal Circuit decision upholding the invalidity of the '071 patent and the same Court of Appeals would be asked to hear the appeal of the decision by this Court finding the ’071 patent not invalid. 9 (The implications of such circumstances need not be discussed in detail at this point.)

Unlike the prudential problems posed above, the issue posed by conflicting decisions — one finding the ’071 patent invalid affirmed by the Federal Circuit and one holding the ’071 patent not invalid — is a practical problem courts and commentators have addressed although not in this specific context.

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In Re Convertible Rowing Exerciser Patent Litigation
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721 F. Supp. 596, 12 U.S.P.Q. 2d (BNA) 1275, 11 I.T.R.D. (BNA) 1580, 1989 U.S. Dist. LEXIS 11409, 1989 WL 110483, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-convertible-rowing-exerciser-patent-litigation-ded-1989.