Zoltek Corp. v. United States

815 F.3d 1302, 117 U.S.P.Q. 2d (BNA) 1866, 2016 U.S. App. LEXIS 2863, 2016 WL 683819
CourtCourt of Appeals for the Federal Circuit
DecidedFebruary 19, 2016
Docket2014-5082
StatusPublished
Cited by5 cases

This text of 815 F.3d 1302 (Zoltek Corp. v. United States) 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.

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Zoltek Corp. v. United States, 815 F.3d 1302, 117 U.S.P.Q. 2d (BNA) 1866, 2016 U.S. App. LEXIS 2863, 2016 WL 683819 (Fed. Cir. 2016).

Opinion

*1304 NEWMAN, Circuit Judge.

Zoltek Corporation seeks compensation from the United States for use, with the authorization and consent of the Departments of the Air Force and Navy, of the patented method of producing carbon fiber sheet products as claimed in United States Reissue Patent No. Re 34,162 issued January 19,1993 (“the '162 patent”). The 162 patent is a reissue of U.S. Patent No. 4,728,395, issued March 1,1988 to inventor George Boyd and assigned to Mr. Boyd’s employer Stackpole Fibers Company. The patent was acquired by Zoltek Corporation with its acquisition of Stackpole in 1988.

Litigation history

On March 25, 1996, Zoltek filed suit in the United States Court of Federal Claims (CFC) alleging that the process used to produce carbon fiber sheet materials for the B-2 Bomber and the F-22 Fighter Plane infringed the 162 patent. This is the third appeal in this action. The factual background is set forth in the prior opinions of the CFC and this court.

In the first appeal, this court answered a certified question to hold that the patentee has no cause of action against the United States when any step of the patented method is practiced outside of the United States, as for the F-22 Fighter. Zoltek Corporation v. United States, 442 F.3d 1345, 1353 (Fed.Cir.2006) (Plager, J., dissenting) (Zoltek I).

On remand, the CFC granted Zoltek’s request for leave to amend its complaint to substitute as defendant Lockheed Martin, the general contractor for the F-22 Fighter, and then granted Zoltek’s motion to transfer the count relating to the F-22 Fighter to the United States District Court for the Northern District of Georgia, where it was “reasonably plausible” that the court had jurisdiction over an infringement suit against Lockheed. Zoltek Corporation v. United States, 85 Fed.Cl. 409, 422 (2009). On Lockheed’s motion, this aspect was certified for appeal.

The Federal Circuit then acted en banc (in part) and reversed its ruling in Zoltek I. This court recognized the liability of the United States for infringement by acts that are performed with its authorization and consent. 28 U.S.C. § 1498(a) (“Whenever an invention described in and covered by a patent of the United States is used or manufactured by or for the United States without license of the owner thereof or lawful right to use or manufacture the same, the owner’s remedy shall be by action against the United States in the United States Court of Federal Claims for the recovery of his reasonable and entire compensation for such use and manufacture.”). By statute the contractor is immunized from liability. Id. (“use or manufacture ... by a contractor ... shall be construed as use or manufacture for the United States”). This court dismissed Lockheed as a party, negated the proposed transfer to Georgia, and remanded to the Court of Federal Claims for inclusion of counts for infringement with respect to both the F-22 Fighter and the B-2 Bomber, Zoltek Corporation v. United States, 672 F.3d 1309, 1311 (Fed.Cir.2012) (en banc) (Zoltek II).

On remand, the CFC separated trial of the issues of validity and infringement, and denied discovery as to infringement with respect to the F-22 Fighter. Zoltek sought mandamus from this court concerning these actions; the petition was denied. In re Zoltek Corporation, 526 Fed.Appx. 956, 957 (Fed.Cir.2013) (non-precedential). Trial proceeded in the CFC, limited to validity. The government challenged the '162 patent under sections 101, 103, and 112 of Title 35. The CFC sustained patent eligibility under section 101; that ruling is not appealed.

At trial, each side presented an expert witness, Dr. Brian Sullivan for the government and Mr. Zsolt Rumy for Zoltek. The *1305 CFC held the asserted claims invalid on the grounds of obviousness and inadequate written description. Zoltek Corporation v. United States, No. 96-166 C, 2014 WL 1279162 (Fed.Cl. Mar. 31, 2014) (“CFC Op.”). Zoltek appeals, arguing that the CFC applied incorrect laws of written description and obviousness, that the CFC did not apply the appropriate burdens and standards of proof, and that the CFC erred in its conclusions.

Zoltek also argues that the issues were improperly bifurcated. We conclude that in the circumstances of this case, taking note of the government’s official invocation of state secret privilege, the CFC acted within its discretion in limiting trial initially to the issues of validity. However, as we next discuss, we conclude that the trial court erred in its judgment of patent invalidity.

The Boyd Invention

The '162 patent is directed to a method of manufacturing carbon fiber sheet products whose electrical resistivity is pre-se-lected and value-controlled by the described method. This method is based on Boyd’s discovery of a non-linear relationship among the heat treatment conditions, partial carbonization, and surface resistivity 1 of sheet products.

The method as claimed in the reissue patent starts with a previously oxidized and stabilized carbonizable fiber, a product known in the prior art and commercially available. This oxidized fiber is then partially carbonized in accordance with the relationship discovered by Boyd, to produce a partially carbonized fiber whose sheet products have the desired pre-select-ed surface electrical resistance.

This method permits production of carbonized sheets of pre-selected and uniform electrical resistance, and thus uniform preselected insulating properties. The '162 specification states that theretofore carbon fiber sheets having specified surface electrical resistance were available only by including other materials, such as glass or aluminum filaments, with the carbonized fibers. '162 patent, col. 111.49-60.

Patent Figure 4 shows the foundation discovery of resistivity as a function of carbonizing temperature:

*1306 [[Image here]]

The lower curve represents the volume resistivity for single fibers at the carbonizing temperature, and upper curves A and B show surface resistivities for one half ounce per square yard and one ounce per square yard sheet products incorporating the designated partially carbonized fibers. The patent describes and exemplifies the preparation of fibers having the preselected partial carbonization, and the production of sheet products having the desired-electrical properties. Id., col.4 11.19-23 (“[T]he temperature-resistivity of the single carbonized fiber is translated into the preselected desired surface resistance of the resultant partially carbonized fiber sheet product produced with such fibers.”).

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815 F.3d 1302, 117 U.S.P.Q. 2d (BNA) 1866, 2016 U.S. App. LEXIS 2863, 2016 WL 683819, Counsel Stack Legal Research, https://law.counselstack.com/opinion/zoltek-corp-v-united-states-cafc-2016.