Metso Minerals, Inc. v. Powerscreen International Distribution Ltd.

833 F. Supp. 2d 321, 2011 U.S. Dist. LEXIS 141694, 2011 WL 6225371
District Court, E.D. New York·Decided December 8, 2011·No. No. 06-cv-1446 (ADS)(ETB)·Published·Cited by 4 cases

Opinion

MEMORANDUM OF DECISION AND ORDER

SPATT, District Judge.

The Plaintiff Metso Minerals commenced the present law suit in 2006, alleging that the Defendants Powerscreen International Distribution Limited (“Powerscreen”), Terex Corporation (“Terex”), Powerscreen New York, Inc. (“PSNY”), and Emerald Equipment Systems, Inc. (“Emerald”), manufactured and sold prod[325]*325uets that infringed United States Patent 5,577,618 (the “'618 patent”). Following discovery, claim construction, and summary judgment, the Plaintiff tried its case to a jury in late 2010. At the seven-week trial, among other defenses, the Defendants challenged the validity of the '618 patent, but on December 6, 2010, the jury returned a verdict rejecting this challenge. The jury found, in part, that no asserted claim of the '618 patent would have been obvious to a person of ordinary skill in the art at the time of the invention. The jury concluded that the Defendants had willfully infringed, either literally or by equivalents, claims 1, 2, 3 and 7 of the '618 patent with respect to the manufacture and sale of eleven screening machines in the United States over a ten year period. In addition, the jury rendered an advisory verdict denying the defenses of laches and inequitable conduct.

On March 3, 2011, the Court entered Judgment on the jury verdict, including the jury’s two advisory verdicts. With regard to the defense of laches, the Court entered judgment that “[t]he defendants did not prove that the plaintiff is not entitled to recover damages for acts that occurred before it filed this lawsuit on March 29, 2006 because: (1) plaintiff delayed filing this lawsuit for an unreasonably long and inexcusable period of time, and (2) the defendants have been prejudiced in a significant way as a result of the plaintiffs delay in filing this lawsuit.”

With regard to the defense and counterclaim of inequitable conduct, the Court entered judgment that “[t]he defendants did not prove that the inventor, Malachy Rafferty, breached the duty of candor and good faith and committed inequitable conduct in the United States Patent and Trademark Office during the prosecution of the application for the '618 patent by failing to disclose material information with the intent to mislead the U.S. Patent Office Examiner.”

Federal Rule of Civil Procedure 52(a)(1) (“Fed.R.Civ.P. 52(a)(1)”) provides that “[i]n an action tried on the facts without a jury or with an advisory jury, the court must find the facts specially and state its conclusions of law separately. The findings and conclusions may be stated on the record after the close of the evidence or may appear in an opinion or a memorandum of decision filed by the court.” Fed.R.Civ.P. 52(a)(1); See N.A.A.C.P. v. AcuSport, Inc., 271 F.Supp.2d 435, 471 (E.D.N.Y.2003) (“Under the modern Federal Rules of Civil Procedure, the court is required to make and explain its own independent findings of fact and conclusions of law in an equitable action even where an advisory jury has rendered a verdict.”) DeFelice v. Am. Int’l Life Assurance Co. of New York, 112 F.3d 61, 65 (2d Cir.1997) (noting that a trial court that uses an advisory jury must make both “its own factual findings and conclusions, in reliance upon the advisory jury’s verdict if the court so chooses, and ... explain how it arrived at those findings and conclusions”).

An advisory verdict is not binding on the court making those findings. See Ragin v. Harry Macklowe Real Estate Co., 6 F.3d 898, 907 (2d Cir.1993) (“A district court is not bound by the findings of the advisory jury, which it is free to adopt in whole or in part or to totally disregard.” (quoting Sheila’s Shine Prods., Inc. v. Sheila Shine, Inc., 486 F.2d 114, 122 (5th Cir.1973))); Felker v. Pepsi-Cola Co., 101 F.3d 109 (2d Cir.1996) (unpublished opinion) (upholding trial court’s rejection of advisory jury findings). The Court “need only make brief, definite, pertinent findings and conclusions upon the contested matters; there is no necessity for over-elaboration of detail or particularization of facts.” See the Adviso[326]*326ry Committee Note to 1946 Amendment of Fed.R.Civ.P. 52.

Therefore, according to the provision of Fed.R.Civ.P. 52(a)(1), the Court makes the following findings of fact and conclusions of law and thereby modifies the final entry of judgment as set forth below.

I. LACHES

The Defendants assert that the doctrine of laches should be applied in the present case to limit the Plaintiffs recovery, if any, to damages from sales after the lawsuit was commenced because (1) Metso delayed filing this lawsuit for an unreasonably long and inexcusable period of time, and (2) the Defendants were prejudiced in a significant or material evidentiary way due to Metso’s delay in filing this lawsuit. The Defendants state that they began selling the accused screening plants in the United States in 2000, and that despite the Plaintiffs knowledge of this, the Plaintiff did not file the present suit until 2006. The Defendants assert that during this time, the Plaintiff lost and destroyed files relevant to the litigation, and that this caused material prejudice. The Plaintiff states that any document destruction during this period was routine and immaterial, and that much of the delay in filing suit was due to settlement negotiations.

Previously, this Court found that summary judgment on this issue was inappropriate.

Here, even considering settlement negotiations, the period between discovery of the alleged infringement and the filing of suit is significant. Further, the Plaintiff admits to having permitted the destruction in 2005 of the entirety of the patent prosecution file held by the U.S. attorney who filed the '618 application. While the Plaintiff claims that all of the documents in this file were duplicates of those held by others, the Court finds that the destruction of this file alone raises genuine issues of fact with respect to the Defendants’ assertion of laches.

Metso Minerals, Inc. v. Powerscreen Int’l Distribution Ltd., 681 F.Supp.2d 309, 339-340 (E.D.N.Y.2010) ("Metso I").

The Court now finds that the Defendants have failed to establish the first element of the laches defense; namely, an unreasonable delay by the Plaintiff Metso in bringing suit. In addition, even if it is assumed that this first element was established, the Court finds that the Defendants have suffered neither economic nor evidentiary prejudice.

A. Relevant Law

The defense of laches is a “question primarily addressed to the discretion of the trial court which must consider the equities of the parties.” Gardner v. Panama R.R. Co., 342 U.S. 29, 30, 31, 72 S.Ct.

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Metso Minerals, Inc. v. Powerscreen International Distribution Ltd., 833 F. Supp. 2d 321, 2011 U.S. Dist. LEXIS 141694, 2011 WL 6225371 (E.D.N.Y. 2011).

833 F. Supp. 2d 321 (Metso Minerals, Inc. v. Powerscreen International Distribution Ltd.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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