Panduit Corporation v. Dennison Manufacturing Co.

810 F.2d 1561, 1 U.S.P.Q. 2d (BNA) 1593, 1987 U.S. App. LEXIS 4
CourtCourt of Appeals for the Federal Circuit
DecidedJanuary 23, 1987
DocketAppeal 85-1144
StatusPublished
Cited by237 cases

This text of 810 F.2d 1561 (Panduit Corporation v. Dennison Manufacturing Co.) 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
Panduit Corporation v. Dennison Manufacturing Co., 810 F.2d 1561, 1 U.S.P.Q. 2d (BNA) 1593, 1987 U.S. App. LEXIS 4 (Fed. Cir. 1987).

Opinion

MARKEY, Chief Judge.

On remand from the Supreme Court. Having considered the record, appealed judgment, district court’s findings and application of law, arguments in this court and the Supreme Court, and invited briefs of the parties and amicus American Intellectual Property Law Association, we respond to the remand and again affirm the judgment on the 35 U.S.C. § 102(g) defense and reverse the judgment on the 35 U.S.C. § 103 defense.

The Remand

In remanding, Dennison Manufacturing Co. v. Panduit Corp., — U.S.-, 106 S.Ct. 1578, 89 L.Ed.2d 817, 229 USPQ 478 (1986), vacating, 774 F.2d 1082, 227 USPQ 337 (Fed.Cir.1985), the Supreme Court said:

Petitioner contends that the Federal Circuit ignored Federal Rule of Civil Procedure 52(a) in substituting its view of factual issues for that of the District Court. In particular, petitioner complains of the rejection of the District Court’s determination of what the prior art revealed and its findings that the differences identified between respondent’s patents and the prior art were obvious.
Petitioner’s claims are not insubstantial. As this Court observed in Graham v. John Deere Co., 383 U.S. 1, 17-18 [86 S.Ct. 684, 693-94, 15 L.Ed.2d 545, 556-57], 148 USPQ 459, 467 (1966):
“While the ultimate question of patent validity is one of law, ... the § 103 condition [that is, nonobviousness] ... lends itself to several basic factual inquiries. Under § 103, the scope and content of the prior art are to be determined; differences between the prior art and the claims at issue are to be ascertained; and the level of ordinary skill in the pertinent art resolved. Against this background, the obviousness or nonobviousness of the subject matter is determined. Such secondary considerations as commercial success, long felt but unresolved needs, failure of others, etc., might be utilized to give light to the circumstances surrounding the origin of the subject matter sought to be patented. As indicia of obviousness or nonobviousness, these inquiries may have relevancy.”
This description of the obviousness inquiry makes it clear that whether or not the ultimate question of obviousness is a question of fact subject to Rule 52(a), the subsidiary determinations of the District Court, at the least, ought to be subject to the Rule.
The Federal Circuit, however, did not mention Rule 52(a), did not explicitly apply the clearly-erroneous standard to any of the District Court’s findings on obviousness and did not explain why, if it was of that view, Rule 52(a) had no applicability to this issue. We therefore lack an adequate explanation of the basis for the Court of Appeals’ judgment: most importantly, we lack the benefit of the Federal Circuit’s informed opinion on the complex issue of the degree to which the obviousness determination is one of fact. In the absence of an opinion clearly setting forth the views of the Court of Appeals on these matters, we are not prepared to give plenary consideration to petitioner’s claim that the decision below cannot be squared with Rule 52(a). Instead, we grant the petition for certiora-ri, vacate the judgment and remand the *1565 case to the Court of Appeals for further consideration in light of Rule 52(a).

106 S.Ct. at 1579, 89 L.Ed.2d at 821, 229 USPQ at 479.

Opinion on Remand

Reversal of the district court’s judgment on the § 103 defense was and is compelled because of legal error, because a first set of clearly correct and unchallenged findings requires that the conclusion of nonob-viousness, 35 U.S.C. § 282, 1 must remain untrammeled and because a second set of findings, some nonprobative, some clearly erroneous, is unable to support, intrinsically and in light of the first set, the district court’s conclusion of obviousness.

The Background section of our earlier opinion noted error in the second set of findings but did not label it clearly erroneous, Rule 52(a), and did not expressly indicate that the noted error was not the basis for reversal set forth in the Opinion section, thus raising a question respecting the basis for our judgment. That circumstance, regrettable because it has delayed a just end to this litigation, is here rectified.

On review of a judgment based on a conclusion of obviousness under 35 U.S.C. § 103 2 , this court must consider not only whether there is legal error, but also whether the underlying findings are either nonprobative, or clearly erroneous, or both. If, unlike the present case, a district court had not made findings necessary to resolution of the § 103 question, and legal error were present, an appellate court would vacate in view of that legal error and remand for the district court to make the missing findings. Loctite Corp. v. Ultraseal Ltd., 781 F.2d 861, 872-75, 228 USPQ 90, 97-99 (Fed.Cir.1985). If unassailable findings were made but could not support the appealed judgment under a proper application of law, an appellate court may vacate or reverse, but not make its own findings. Icicle Seafoods, Inc. v. Worthington, — U.S. -, -, 106 S.Ct. 1527, 1530, 89 L.Ed.2d 739, 743 (1986).

If findings necessary to support a legal conclusion are clearly erroneous, the conclusion cannot stand. If those facts were such as to permit only one of two possibilities, or if the burden of proving those necessary facts had been on appellee, reversal would not mean the appellate court found facts in defiance of Rule 52(a). 3 If, unlike the present case, appellee did not bear the burden below, a remand-requiring fact-finding function might remain.

To obtain reversal without remand, an appellant-patentee must convince this court that the patent challenger failed at trial to carry its statutory burden, 35 U.S.C. § 282, of proving by clear and convincing evidence sufficient facts to support the obviousness conclusion. One way to do that is to show that a proper application of the law to unassailable findings compels reversal. Another is to show that the findings on which the obviousness conclusion rested are clearly erroneous and that nothing of record warrants a further exercise of the fact-finding function or indicates any *1566 possibility that the appealed judgment might be sustained by such exercise.

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Bluebook (online)
810 F.2d 1561, 1 U.S.P.Q. 2d (BNA) 1593, 1987 U.S. App. LEXIS 4, Counsel Stack Legal Research, https://law.counselstack.com/opinion/panduit-corporation-v-dennison-manufacturing-co-cafc-1987.