Ksm Fastening Systems, Inc. v. H.A. Jones Company, Inc. And Erico Jones Company

776 F.2d 1522, 227 U.S.P.Q. (BNA) 676, 1985 U.S. App. LEXIS 15311
CourtCourt of Appeals for the Federal Circuit
DecidedOctober 29, 1985
DocketAppeal 84-1568
StatusPublished
Cited by106 cases

This text of 776 F.2d 1522 (Ksm Fastening Systems, Inc. v. H.A. Jones Company, Inc. And Erico Jones Company) 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
Ksm Fastening Systems, Inc. v. H.A. Jones Company, Inc. And Erico Jones Company, 776 F.2d 1522, 227 U.S.P.Q. (BNA) 676, 1985 U.S. App. LEXIS 15311 (Fed. Cir. 1985).

Opinions

NIES, Circuit Judge.

This appeal is from an order of the United States District Court for the District of New Jersey (Judge John F. Gerry presiding) holding H.A. Jones Company, Inc. and Erico Jones Company (hereinafter collectively Jones) in civil contempt of court for violation of the terms of a consent decree entered in a patent infringement suit. On April 30, 1979, a predecessor of KSM Fastening Systems, Inc., brought suit against Jones alleging infringement of U.S. Patent No. 3,738,217, which claims a particular hanger assembly or anchor for securing refractory linings to furnace walls (KSM’s INSULTWIST), by reason of Jones’ manufacture and sale of a device of that type (Jones’ THERMAL-LOCK device). Pursuant to a settlement agreement between the parties, which was entered as a consent decree on March 6, 1980, Jones acknowledged the validity of the KSM patent, admitted infringement thereof by its THER[1524]*1524MAL-LOCK device, and was enjoined from further infringement.

Jones subsequently put out a modified refractory anchor (ULTRA-LOK I) and on September 22, 1981, KSM moved the court to punish Jones for contempt for violation of the injunction. On July 17, 1984, the court found Jones in contempt by reason of Jones’ manufacture and sale of the ULTRA-LOK I device and another model, ULTRA-LOK II, which Jones began marketing in late 1983 or early 1984. This appeal followed.1

Under the standard we conclude is appropriate, the judgment must be set aside as a matter of law because of the refusal of the district court to consider whether the Jones ULTRA-LOK devices infringed the claims of the ’217 patent. Moreover, the question whether contempt proceedings involving the ULTRA-LOK devices are appropriate must also be reexamined. Therefore, upon remand, the district court is directed to reconsider whether, under the standard set forth herein, infringement with respect to the ULTRA-LOK devices should be tested in contempt proceedings.

I.

Under the Patent Act of 1952, as part of the relief available to a prevailing patent owner, 35 U.S.C. § 283 provides:

The several courts having jurisdiction of cases under this title may grant injunctions in accordance with the principles of equity to prevent the violation of any right secured by patent, on such terms as the court deems reasonable.

While the grant of injunctive authority is clearly in discretionary terms, Roche Products, Inc. v. Bolar Pharmaceutical Co., Inc., 733 F.2d 858, 865, 221 USPQ 937, 942 (Fed.Cir.), cert. denied, - U.S. -, 105 S.Ct. 183, 83 L.Ed.2d 117 (1984), injunctive relief against an infringer is the norm. See Smith International, Inc. v. Hughes Tool Company, 718 F.2d 1573, 219 USPQ 686 (Fed.Cir.), cert. denied, 464 U.S. 996, 104 S.Ct. 493, 78 L.Ed.2d 687 (1983).

Having enjoined the infringer, a patent owner who is confronted with another possible infringement by that party in the form of a modified device will very likely seek to invoke the power of the court to punish the adjudged infringer for contempt in violating the court’s injunctive order. While a patent owner, in such circumstances, could institute a separate suit to enjoin the modified device, the advantages of proceeding on a motion to hold his adversary in contempt are substantial. The adjudged infringer is already under the jurisdiction of the court and may be summoned to appear to respond on the merits, the contempt motion being merely part of the original action. Leman v. Krentler-Arnold Hinge Last Co., 284 U.S. 448, 52 S.Ct. 238, 76 L.Ed. 389 (1932). Contempt proceedings are generally summary in nature and may be decided by the court on affidavits and exhibits without the formalities of a full trial, although the movant bears the heavy burden of proving violation by clear and convincing evidence. See 11 Wright & Miller, Federal Practice and Procedure: Civil § 2960 at 591, and cases cited therein; see also Quinter v. Volkswagen of America, 676 F.2d 969, 974 (3rd Cir.1982); A.H. Robins Co., Inc. v. Fadely, 299 F.2d 557, 559 (5th Cir.1962); Fox v. Capitol Co., 96 F.2d 684, 686 (3rd Cir.1938). If violation is found, the contemnor may be punished by fine (payable to the patent owner) and imprisonment, even in civil contempt. Wright & Miller, supra, at 584-85.2

A civil contempt proceeding for violation of an injunction issued after patent litigation, while primarily for the benefit of the patent owner, nevertheless, involves also the concept of an affront to the court for failure to obey its order. As explained in American Foundry & Manufacturing Co. v. Josam Manufacturing Co., 79 F.2d 116, 118, 26 USPQ 338, 339 (8th Cir.1935):

[1525]*1525A decision adjudging infringement necessarily finds the particular accused device to be within the valid boundary of the patent. The decree usually carries a prohibition against further infringement — not as to any and every possible infringement, but as to the particular device found to be infringement and as to all other devices which are merely “colorable” changes of the infringing one or of the patent. This limitation of the effect of such a decree is occasioned somewhat by the indefinite character of the boundaries of a patent, but more by the character of the remedy — summary contempt proceedings — used to enforce such provisions of a decree. This is merely an application to patent injunction contempt proceedings of the general rule as to all civil contempt proceedings. Oriel v. Russell, 278 U.S. 358, 365, 49 S.Ct. 173 [175] 73 L.Ed. 419; City of Campbell v. Arkansas-Missouri Power Co., 65 Fed.(2d) 425, 428 (C.C.A.8). That rule was stated by this Court to be that “when it is doubtful whether a decree of injunction has been violated, a court is not justified in punishing for contempt, either criminal or civil, for the reason that no one can say with any degree of certainty that the authority of the court needs vindication or that the aggrieved party is entitled to remedial punishment” City of Campbell v. Arkansas-Missouri Power Co., 65 Fed.(2d) 425, 427, 428.

In view of these and other considerations to be discussed, where the patent owner seeks to enforce an injunction against an enjoined infringer by reason of a manufacture which was not the subject of the original litigation, the courts have been uniform in exercising restraint in affording the patent owner the benefit of contempt proceedings.

In MAC Corp. of America v. Williams Patent Crusher & Pulverizer Co., 767 F.2d 882, 226 USPQ 515 (Fed.Cir.1985), this court affirmed the denial of proceedings in contempt where the district court found a “fair ground of doubt” that the injunction against infringement had been violated because of differences between the adjudged and accused devices. In so holding, the court followed the Supreme Court’s directive in California Artificial Stone Paving Co. v. Molitor, 113 U.S. 609, 618, 5 S.Ct. 618, 622, 28 L.Ed. 1106 (1885):

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776 F.2d 1522, 227 U.S.P.Q. (BNA) 676, 1985 U.S. App. LEXIS 15311, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ksm-fastening-systems-inc-v-ha-jones-company-inc-and-erico-jones-cafc-1985.