292 F.2d 668
130 U.S.P.Q. 90
THERMO KING CORPORATION and Dawes Manufacturing Company,
Appellants-Appellees,
v.
WHITE'S TRUCKING SERVICE, INC. and Transicold Corporation,
Appellees-Appellants.
WHITE'S TRUCKING SERVICE, INC. and Transicold Corporation,
Appellees-Appellants,
v.
THERMO KING CORPORATION and Dawes Manufacturing Company,
Appellants-Appellees.
No. 18214.
United States Court of Appeals Fifth Circuit.
June 27, 1961.
Harold D. Field, Jr., Benedict Deinard, Minneapolis, Minn., Eugene C. Heiman, Miami, Fla., Leonard Street & Deinard, Minneapolis, Minn., Myers, Heiman & Kaplan, Miami, Fla., of counsel, for appellants.
Francis Browne, Washington, D.C., Bart L. Cohen, Miami, Fla., Schwarz & Cohen, Miami, Fla., William E. Schuyler, Jr., Andrew B. Beveridge, Mead, Browne, Schuyler & Beveridge, Washington, D.C., of counsel, for appellees.
Before RIVES, BROWN and WISDOM, Circuit Judges.
JOHN R. BROWN, Circuit Judge.
This case illustrates again that the shortest way through may be the longest way around. Through a combination of circumstances, none of which was finally within the control of either counsel nor caused by initial error on the part of the particular Judge trying the case, the Trial Court countenanced the complete disregard of a procedural statute. The loser contends that this error infected the whole proceeding so much so that its harmful consequences are clearly demonstrated. In any event, it is further urged, such a substantial doubt is cast upon the reliability of the Court's findings that a retrial free from the influences of this error is imperatively required. We agree and reverse.
The suit was by the patentee, Thermo King, against Transicold for infringement of three patents relating to mechanical refrigeration of automotive trucks.
The Trial Judge, in his own words, 'reluctantly' held the patents valid but then found no infringement. The Patentee was denied all relief and the alleged Infringer was granted a sweeping injunction against further suits anywhere, anytime at any place against Transicold or any of its dealers or customers.
Since we do not deal with the substantive merits of the controversy, it is enough to describe the patents very broadly. A basic problem in refrigeration of trucks is to provide some means by which the operation of a freezer unit may be effectively regulated to maintain desired temperature levels. An automatic mechanical system is needed because of the practical inability of the truck driver, whose hands are already full, to care for this manually. In this area, the most acute single problem is defrosting the evaporator coils. Heat has to be somehow applied to the coils. And since the automatic systems use a gas refrigerant, whatever plan is employed has to assure that condensed liquids do not get back to the inlet side of the gas compressor.
These patents, and especially No. 2, are hailed by the Patentee as revolutionary discoveries which found the answers to the problems which so long made mechanical automotive refrigeration impracticable. No. 1 is a temperature control device that regulates the gasoline compressor engine at idle or full speed. No. 2 is a means of introducing so-called super-heat gas out of the stream of compressed gas into the evaporator coils to melt the accumulated frost on the exterior of the coils. This includes, of course, devices actuated by pressure or temperature differential controls to begin and end the defrost operation. No 3 discloses primarily an electric control circuit for use in a No. 2 super-heat system.
The pivotal factor is the notice provision of 282 of the Patent Act, 35 U.S.C.A. 282. This section first provides that the patent, when issued, is presumptively valid. It then permits, if pleaded, the defenses of non-infringement, invalidity for failure to comply with any of the specified requirements of the Act or any other defense specified in the Act. Of decisive importance here is the last portion which provides that in actions involving validity or infringement, the party asserting invalidity or non-infringement must give 30-day written notice of the prior art.
The defendant-infringer, both in answer and counter-claim, denied validity and infringement. In the most general terms, it alleged that the patentee, Jones, 'was not * * * the inventor * * *'; that the claimed inventions 'were known or used by others in this country, or patented or described in a printed publication * * *' prior to Jones; that they 'were patented or described in printed publications * * * and/or were in public use or on sale * * * more than one year prior to * * * application * * * by * * * Jones * * *'; they 'were described in patents granted * * * others * * * before * * * Jones'; prior to Jones the inventions claimed were 'made in this country by others who have not abandoned, suppressed or concealed them;' the differences between prior art and invention 'would have been obvious to a person having ordinary skill in the * * * arts * * *' of 'the refrigeration and/or electrical arts'; the claims are inadequate under 35 U.S.C.A. 112 for want of particularity.
Not a single prior patent was cited in the infringer's pleadings and down to the commencement of trial no written notice of any kind was given of prior patents, prior publications, prior use, or prior art.
In many ways this case is the unintended victim of court congestion typical of many metropolitan areas such as Miami. It demonstrates also that the use of designated visiting judges not only does not offer a panacea, but brings on some special problems of its own. Experience has indicated that for efficient utilization of visiting judges, the resident presiding judge must make up the calendar in advance to supply a docket of cases fixed and ready for trial. Of course, the visiting judge still has the responsibility of taking action as subsequent developments require, but there is an understandable reluctance on his part to continue or postpone or abjourn a case thus fixed. Since visiting judges normally are designated for a limited period of time, to do so frequently means that the case must then fall back on the overcongested resident judge or upon some later visiting judge. Of course, one practical safeguard is an adequate and thorough pretrial to determine whether the case is really ready. These problems in court administration have much to do with the action in this case.
This case was not really very old.
The complaint was filed August 5, 1958, amended August 14. The defendants answered and counter-claimed on November 4, 1958. On December 22, 1958, the patentee filed its responsive pleading. On January 15, 1959, the Clerk sent written notice fixing the trial for February 15, 1959. Counsel did not receive this until January 17. Neither party was ready as the joint motion for continuance of January 28, 1959, attested. This was overruled by the presiding resident judge February 5. On the date (January 17, 1959) counsel received notice of the setting for February 15, there were, of course, less than 30 days remaining. The defendant could not have complied with 282. But no effort was made to give as much notice as the remaining time made possible. There were other pretrial maneuvers before the Court but in none was the possibility suggested that defendant had specific prior patents and prior art to offer on the trial.
The trial commenced February 18, 1959, before the visiting judge. In the opening moments of the trial the defendants for the first time tendered a written notice under 282.
That written notice listed 8 patents, 6 pieces of literature from the carrier corporation, 1 from another refrigerator manufacturer, and the names (and cities but no addresses) of two persons under the broad heading of 'Prior Invention Knowledge or Use.' The patentee objected vigorously to this belated tender. Its counsel pointed out the difficulties, if not impossibilities, of obtaining file wrapper histories and other data from the patent office and stated emphatically that it 'is utterly impossible' and 'we could not be afforded a fair trial.'
Except to recite the short notice of trial date, the unsuccessful mutual efforts to postpone the trial, and the relative newness of the case, the defendant could offer no reasons why notice had been so long delayed. Defendants called the Court's attention to Fairchild v. Poe, 5 Cir., 1958, 259 F.2d 329, 332-333, urged before us as well 'in support of the court's invoking its discretion and waiving the requirement of the rule.' Defendants offered also that 'subsequent to trial we will be happy to allow any amount of time that the plaintiff may wish.' The visiting trial judge after hearing this extended argument rejected all of these suggestions by the defendants and sustained the plaintiff's objection without qualification of any kind. The judge's reasons went to the very heart of the statute. 'It wouldn't be fair to require the plaintiff to meet this.'
By this ruling the Patentee was informed that the trial would proceed without the necessity of meeting any prior art evidence of the type which the notice statute 282 and the case law construing it required a defendant to specify in writing. The defendants understood the full import of it, for they moved immediately for a continuance. The Court denied this out of hand.
But the trial, then just in its opening phases, was to turn out to be something quite different. For by the time the final going was rung in this 9-day trial, the judge admitted over vigorous objection of the Patentee, a total of 34 patents not a single one of which had ever been cited by the defendants before the trial began. In addition the Court allowed prior use testimony of two of the defendant's witnesses Swinburne and Kirkpatrick and supporting prior printed publication exhibits specified in the rejected belated written notice.
The admission of these specific patents in evidence cannot be passed off as cumulative or innocuous. The trial judge's lengthy formal opinion lists 20 patents as being relied on by defendants to establish the prior art. These 20 so listed include all four of Class D and six out of the seven of Class B, note 7, supra. Of the 20, he discussed at some length ten patents. These ten included five out of the seven of Class B and one out of the four of Class D. That means that the judge thought significant five patents out of the same Patent Office classification, but of which neither Thermo King nor its counsel had knowledge and at least one patent neither in the same class nor within Thermo King's actual knowledge. Also treated as significant were two of the patents in group 2 and two in group C as patents cited against patent No. 2 or against other Thermo King patents not in suit. How much the whole trial changed from its opening character is graphically portrayed by comparing this list of 34 patents with the belated notice tendered at the start of the trial. That list specified eight patents six of which were in the list of 34 admitted in evidence.
It is difficult to understand how the judge was ever led to admit those patents in groups B and D. The record never reflects any specific reason. Presumably the bars were let down altogether once the judge, perhaps unwittingly changing the rules in the middle of the game, Laird v. Air Carrier Engine Service, Inc., 5 Cir., 1959, 263 F.2d 948, reached the conclusion that those in groups 1, 2, 3, A and perhaps C were admissible despite 282. We think this pinpoints the source of the judge's error. Apparently he reasoned that 282 was intended merely to alert a patentee to the existence of prior art of which he would not have knowledge. Consequently, the argument continues, since a patentee knows about the prior patent cited by the patent office against the patent (or its predecessor applications), there is no need to give the statutory notice.
But this statutory notice has a more fundamental purpose than that, important though that be. In a day when we unconsciously think that pretrial discovery and preparation is a latter day contribution to jurisprudence, this statute is indeed interesting. Section 282 is an extension of former 69, formerly R.S. 4920, and traces its origin actually back to the Patent Act of 1790. Liquidometer Corporation v. Capital Airlines, Inc., D.C.D.Del.1959, 24 F.R.D. 319, 321. About one predecessor statute, 15 of the Patent Act of 1836, Justice Story had this to say: 'The object of this most salutary provision is to prevent patentees being surprised at the trial of the cause by evidence of a nature which they could not be presumed to know, or be prepared to meet, and thereby to subject them either to most expensive delay, or to a loss of their cause * * *.' Philadelphia & Trenton R. Co. v. Stimpson, 1840, 14 Pet. 448, 459, 39 U.S. 448, 459, 10 L.Ed. 535.
Intervening events have perhaps been a transfusion of restore full vigor to it. After the adoption of the Federal Rules of Civil Procedure in 1938, many courts held that the discovery rules superseded 69. Liquidometer Corporation v. Capital Airlines, Inc., D.C., 24 F.R.D. 319, 321 and note 4. But by the Patent Act of 1952, Congress deliberately intended to revive the statute as an effective regulation of patent trial procedure. The result is that the statute and the Federal Rules on discovery now coexist. The one does not exclude or supersede the other. The statute, subject always, of course, to the discretion reserved to the court to allow matters not specified in a notice to be received 'on such terms as the court requires' operates as a minimum. Liquidometer Corporation v. Capital Airlines, Inc., supra, 24 F.R.D. 319, at page 323.
In its deliberate re-enactment, the additions to the statute reflect an increased, not lessened, importance in its application. As re-enacted it covers both the defenses of invalidity and non-infringement. It was also expanded to cover not only directly anticipatory prior art references, but also prior art references to show the state of the art. And, of great importance, it added the last sentence, see note 3, supra, investing the trial court with discretion to admit non-noticed matters on such terms as the court requires. The objective of this statute in its expanded version has been summed up in C. S. Johnson Co. v. Stromberg, 9 Cir., 1957, 242 F.2d 793, 797. 'It is obvious that the purpose of the thirty day notice rule is to prevent surprise at the trial; to enable both sides to better understand adversarys' case; and to cut down on 'expensive delays,' or to prevent 'a loss of a cause' (Philadelphia & T.R. Co. v. Stimpson, 1840, 14 Pet. 448, at page 459, 39 U.S. 448, at page 459, 10 L.Ed. 535). The very purpose of the exception, as cast by Congress, was to permit and aid the ascertainment of the truth 'on such terms as the court requires.' * * * The notice provision in the statute is salutary. It should be encouraged * * *.' 3 Walker, Patents 660 at 1966, 1968 (Deller ed. 1937), Vol. 4 887D at 2768, 2771 and 1960 supp. to Vol. 4 at 58; see also Gere v. Canal Boiler Works, D.C.Wash., 33 F.Supp. 558.
This statute, just as interrogatories, requests for admissions, and the like under the Rules, is intended to do more than alert an adversary to the existence of evidence. It enables the plaintiff to know what sort of defense is going to be asserted. In a very real sense it determines what is to be tried. It has like value to the court either in trial or in the management of the serious administrative problems in determining what cases are ready for trial and capable of being submitted within the available time. The nature of patent litigation makes this of unusual importance. Judges trained in the law are confronted with baffling devices applying esoteric principles of all branches of higher mathematics and science. Long before the current interest in demonstrative evidence as it is sometimes used (or misused) in damage suits, the patent bar, with its generally high state of professional competence and extraordinary thoroughness in preparation, has found helpful ways to make the judges' task manageable and intelligible. Large multi-colored elaborate charts, diagrams, models and other exhibits, oftentimes costly and complicated, are prepared. They are used both on examination and serve with unusual effectiveness in cross-examination of experts and others skilled in the particular field. To the problem of understanding the substantive nature of the patented device or method may be added the further, if not more basic, one of communication: just what do these words-- often a long, prolix combination with a liberal sprinkling of adverbs and almost no punctuation -- of this claim mean? It is seldom safe to be a literalist. Bryan v. Sid W. Richardson, Inc., 5 Cir., 1958, 254 F.2d 191, 192. The meaning generally calls for a search into the practical considerations of the particular art. Inglett & Co., Inc. v. Everglades Fertilizer Co., 5 Cir., 1958, 255 F.2d 342, 347-48. This is a necessary consequence of the handy apothegm that a patentee is his own grammarian and lexicographer. And all of this naturally leads to the use of experts who, matching element by element, either as between the accused device and the patent, or as between the patent in suit and those asserted to anticipate, undertake to translate the problem into understandable, tangible, specific terms for the judge.
This whole search for truth in a specialized field where matters seldom turn on credibility in its cruder sense-- who is telling the unvarnished truth?-- is impeded unless the adversaries are fully prepared. Preparation, quite obviously, requires knowledge of what principal, specific, factual issues are to be examined.
Hence it is unrealistic to suggest as does the defendant that the Patentee could have overcome the impact of the court's disregard of 282 by asking for a continuance at the trial's end in order to meet or refute the prior art evidence admitted. There is, first, no indication that it would have been granted. The court had already denied two such motions, the last one in the context of this very problem. But in any event, a trial is something more than a truncated parade of one group of witnesses who swear 'yea' and another who respond 'nay.' The time to demonstrate effectively that the factual thesis advanced by a witness is not worthy of acceptance is while he is on the stand. But cross-examination in a technical area frequently requires the availability of material or at least effective demonstrative aids. Consequently, it is one thing to assert as do the defendants that counsel for the Patentee knew of a patent or a series of patents, or for that matter perhaps all of the patents in this patent office classification. It is quite a different matter to contend that by reason of such imputed knowledge such counsel, on the opening of the trial, had to contemplate that every one of such patents would be the subject of close examination and adversary contention.
Nothing we have said is to be understood as holding that whenever 282 is breached the judgment must be reversed. We have previously stated, and now reaffirm, the basic proposition that much discretion is committed to the trial judge. Fairchild v. Poe, 5 Cir., 1958, 259 F.2d 329, 333; Edward Valves, Inc. v. Cameron Iron Works, Inc., 5 Cir., 1961, 286 F.2d 933, 949. From like considerations the statute itself allows evidence to be admitted 'on such terms as the Court requires.' What we deal with here is the same one faced where procedural rules are not followed. On the one side is the command of the statute, reflected in the Rules themselves that cases are not to be reversed if such error is harmless, F.R.Civ.P. 61, 28 U.S.C.A.; 28 U.S.C.A. 2111.
But on the other side is the positive principle expressed in the rule under scrutiny reflecting deliberate judgment by the Judiciary or Congress, or both, of those considerations which experience teaches to be of relevant significance in the administration of justice. Those aims-- those objectives-- become then a part of the inquiry whether transgression of the rule has been hurtful. As in any other area of court administration depending so much on the wise and sound discretion of the judge as he presides over the process leading finally to adjudication, the element of judgment cannot be supplanted by some ready mechanical formula. Hence, it would be a mistake to attempt to simplify it by casting the problem in terms either of who has the burden of demonstrating injury or proposing terms, or the necessity of demonstrating affirmatively that harm has resulted. As a rule 282 operates directly on the court. It is the court which is to impose terms as a condition to admissibility. The judge may not, therefore, passively wait on counsel. At the same time, a wise judge depends greatly on counsel and their suggestions on terms is deserving of a careful study. Likewise, on the element of harmfulness, the situation rarely permits an objective demonstration. Where the operation of the rule bears directly, as it does in 282, on the simultaneous fact impressions being made by evidence on the judge's mind, there is hardly any means of proving that the conclusions would have been otherwise. Indeed, erroneous exclusion of evidence does not demand such showing as a condition of reversal. It is sufficient if in context the evidence excluded has such persuasiveness that it might have led to a different result. In this aspect a factor of great importance is the insulation which surrounds fact findings by the judge as they come to us with the buckler and shield of F.R.Civ.P. 52(a). That so much is committed to the judge as he makes fact findings which may well dispose of serious controversy over complex and baffling patents makes it essential that in the fact finding process the judge, in a fundamental way, has applied those rules which lead to the full development of the truth.
Violation of procedural rules does not often compel reversal. But where we are left with the certain conviction, or more often an abiding impression, that a party was not afforded a fair and adequate opportunity to present his cause, we do not hesitate to reverse. See, e.g., Laird v. Air Carrier Engine Service, Inc., 5 Cir., 1959, 263 F.2d 948; Mitchell v. Johnson, 5 Cir., 1960, 274 F.2d 394; cf. Mitchell v. E-Z Way Towers, Inc., 5 Cir., 1959, 269 F.2d 126.
We have purposely refrained from discussing the merits lest something said or unsaid might influence decision on the merits as the case undergoes the new trial which we order. This litigation presents matters of great importance with substantial consequences in terms of money to these parties. Moreover it is a matter of great concern to the public interest. Consequently, we take pains to make plain that nothing said or unsaid, nothing included or omitted, nothing implied or expressed is to be regarded as a determination or even an intimation, one way or the other, on how this Court thinks this case or any of its numerous issues should be determined. The slate is literally wiped clean. The trial is about to commence. When the new trial is had and judgment reached, but not before, will it be for us to say whether the case ought to have been decided in a particular way.
Reversed and remanded for a new trial.