Virginia Panel Corp. v. MAC Panel Co.

139 F. Supp. 2d 753, 2001 U.S. Dist. LEXIS 8959, 2001 WL 396975
CourtDistrict Court, W.D. Virginia
DecidedApril 17, 2001
DocketCIV.A. 5:93CV00006
StatusPublished

This text of 139 F. Supp. 2d 753 (Virginia Panel Corp. v. MAC Panel Co.) is published on Counsel Stack Legal Research, covering District Court, W.D. Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Virginia Panel Corp. v. MAC Panel Co., 139 F. Supp. 2d 753, 2001 U.S. Dist. LEXIS 8959, 2001 WL 396975 (W.D. Va. 2001).

Opinion

MEMORANDUM OPINION

MICHAEL, Senior District Judge

This patent infringement case comes before the court on the motion of plaintiff *755 Virginia Panel Corporation (Virginia Panel), to hold defendant MAC Panel Company (MAC Panel) in contempt of the court’s permanent injunction. On May 29, 1996, the court permanently enjoined MAC Panel from infringing Virginia Panel’s U.S. Patent No. 4,329,005 (“the ’005 patent”) by manufacturing, using, or selling products that a jury previously adjudged to infringe the ’005 patent. Virginia Panel alleges MAC Panel violated the injunction by selling and offering to sell the very products found to infringe, as well as a redesigned product that, due to a failed engineering effort, does not avoid infringement. Because the court does not find clear and convincing evidence that MAC Panel violated the injunction, Virginia Panel’s motion shall be denied.

I. BACKGROUND

Virginia Panel and MAC Panel are in the business of manufacturing and selling components, assemblies, and systems used in support of automatic test equipment (ATE), which is used to test systems— such as airplane black boxes — that have thousands of electronic connections. Some of the sales are for end-use by the Government, and some are for commercial, nongovernmental end-use.

The two primary components of ATE are “interchangeable test adapters” (ITAs), which have male plugs, and “receivers,” which have female receptacles. ITAs and receivers must be electrically connected together before a unit may be tested. The patent at issue claims a mechanism for engaging an ITA and a receiver. “The claimed mechanism requires that the ITA be suspended from ‘fixed hanger plates’ on opposite sides of the receiver,” and that the contacts of the ITA “be drawn into contact with the receiver contacts through ‘reciprocating’ movement of ‘slide plates’ relative to the hanger plates.” Virginia Panel Corp. v. MAC Panel Co., 133 F.3d 860, 862-63 (Fed.Cir.1997). MAC Panel also makes an ITA/receiver interface, “which uses a ‘rotating latch mechanism’ to push the ITA into contact with the receiver and to achieve proper alignment between the components’ electrical contacts.” Id. at 863.

On January 19, 1993, Virginia Panel sued MAC Panel, alleging that MAC Panel’s sales of its ITA/receiver interface mechanism directly infringed the ’005 patent. It also alleged that because ITAs constitute a material part of Virginia Panel’s patented mechanism, MAC Panel’s sales of MAC Panel ITAs for use in Virginia Panel receivers contributed to and induced infringement of the ’005 patent. The case ultimately proceeded to trial, and on March 6, 1995, the jury rendered its verdict. The jury found that certain MAC Panel ITAs and receivers directly infringed the ’005 patent under the doctrine of equivalents, and that MAC Panel eontribu-torily infringed the ’005 patent by selling MAC Panel ITAs for use in Virginia Panel receivers. Thereafter, the court issued a permanent injunction, which provides:

Defendant MAC Panel Company is hereby ... enjoined from infringing U.S. Patent No. 4,329,005 by manufacturing, using, or selling for commercial, non-government, purposes the adjudged infringing receivers or ITAs it was making, using, and selling as of March 6, 1995, and before, namely its Series 96 receivers and ITAs and its rotating hanger/latch receivers in combination with fixed guide slots or ITAs therefor in the form being made and sold as of March 6, 1995, and before; or ... devic'es no more than eolorably different from such infringing devices. This injunction does not apply to the manufacture and sale of ITAs for use with Virginia Panel Corporation receivers purchased prior to January 1993. 1

(July 27, 1995, Order (temporary injunction); May 29, 1996 Order, reprinted at *756 1996 WL 335381 (converting temporary injunction into permanent injunction).) The parties do not dispute that the permanent injunction proscribes all types of infringement, including direct infringement, inducement of infringement, and contributory infringement. Following an appeal, the Federal Circuit Court of Appeals affirmed the judgment of infringement. See 133 F.3d 860 (1997).

On June 11, 1999, Virginia Panel moved the court to adjudge MAC Panel in contempt of the court’s permanent injunction. The court determined that additional discovery was required on these matters, and the parties engaged in a limited period of discovery. On July 14, 2000, Virginia Panel filed its “Post-Discovery Brief in Support of its Motion for Order Adjudging Defendant MAC Panel Company in Contempt for Violating this Court’s Injunction.” This brief, MAC Panel’s opposition, Virginia Panel’s reply, and the exhibits attached thereto, are the record documents currently pending before the court. 2

II. DISCUSSION

“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.” KSM Fastening Sys., Inc. v. H.A. Jones Co., 776 F.2d 1522, 1524 (Fed.Cir.1985). The court accordingly has jurisdiction over this contempt proceeding pursuant to the court’s inherent power to enforce its own orders. See 18 U.S.C.A. § 401 (West 2000); KSM, 776 F.2d at 1525 n. 3, 1526. While the enjoined party bears the practical burden “of avoiding infringement at the risk of contempt,” Smith Int’l, Inc. v. Hughes Tool Co., 718 F.2d 1573, 1581 n. 8 (Fed.Cir.1983), it is the movant who bears the burden of proof in a contempt proceeding, to “prov[e] violation by clear and convincing evidence.” KSM, 776 F.2d at 1524.

Virginia Panel asserts that MAC Panel should be held in contempt for conduct falling within three categories:

1. Offers for sale and sales of old-design receivers that previously were adjudged to infringe;
2. Offers for sale and sales of MAC Panel ITAs for use in Virginia Panel receivers, which use, Virginia Panel alleges, constitutes inducement of and contributory infringement; and
3. Sales of a redesigned product, “Series 64” receivers, which Virginia Panel alleges constitute direct infringement.

A. OLD DESIGN RECEIVERS

The first category of allegedly infringing and contemptuous conduct concerns MAC Panel’s manufacture, offers for sale, and sales of “old-design” receivers.

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139 F. Supp. 2d 753, 2001 U.S. Dist. LEXIS 8959, 2001 WL 396975, Counsel Stack Legal Research, https://law.counselstack.com/opinion/virginia-panel-corp-v-mac-panel-co-vawd-2001.