Canon, Inc. v. Color Imaging, Inc.
227 F. Supp. 3d 1303
N.D. Ga.2016Background
- Canon moved in limine to exclude five categories of evidence and testimony from Defendants, including evidence of GPI’s own patent (the ’910 patent), communications with counsel, two non-infringement theories ("radially inward" and "free end"), and expert Dr. Springett’s ultimate opinions on exhaustion, implied license, and repair.
- Defendants sought to introduce the ’910 patent and related evidence to rebut willfulness by showing a corporate culture of innovation, and to present theories and expert opinions denying infringement and asserting exhaustion/implied license/repair.
- The court reviewed relevance and prejudice under FRE 401/403, the interplay of claim construction rulings, Patent Local Rules, Rule 26(e) supplementation, and Rule 37(c)(1) exclusion/sanctions.
- The Special Master previously construed Claim 24 to use the plain meaning of "inward direction" (not "radially inward").
- Disputes over disclosure: Defendants did not supplement discovery, non-infringement contentions, or expert reports to disclose the "free end" theory; Dr. Springett’s expert reports did not explicitly treat implied license and did not opine on the "non-infringing uses" element of exhaustion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility of GPI’s ’910 patent/patent application evidence | Irrelevant and misleading; cannot show non-infringement and was issued after conduct, so not probative of willfulness | Relevant to willfulness as evidence of corporate innovation and design-around efforts; harmless because Canon knew about it | Granted in part: limited admission for narrow testimony about corporate culture/innovation; actual patent documents and arguments implying it negates infringement or should be in opening/closing are excluded; pretrial preview required |
| Evidence/argument about legal advice and Chinese translation of patent | Communications with counsel and translation bear on state of mind and should be excluded; Chinese translation should be excluded | Business practices, including consulting counsel, are relevant to corporate practices; but cannot use advice to claim non-willfulness without waiving privilege | Granted in part: Chinese translation excluded; narrowly allow testimony about general business practices (including consulting counsel) but not actions specific to the ’012 patent or advice-based defenses without waiving privilege |
| "Radially inward" non-infringement theory (Claim 24) | Precluded because Special Master already rejected the narrower construction; expert testimony cannot contradict claim construction | Theory differs from prior construction and is consistent with embodiments | Granted: court excludes evidence and argument that Type B bottles do not infringe for failing to move "radially inward" because it conflicts with adopted construction of "inward direction" |
| "Free end" non-infringement theory | Exclude as untimely and undisclosed under Rule 26(e)/Patent Local Rules; Defendants sandbagged Canon | Theory arose from facts developed in expert deposition and claim construction; claim terms can be revisited | Granted: excluded for failure to timely disclose and prejudice under Rule 37(c)(1); parties must not interpret "free end" inconsistent with court’s plain-meaning reading |
| Dr. Springett’s ultimate opinions on exhaustion, implied license, and repair | Exclude because he failed to analyze required legal elements (e.g., reasonable non-infringing uses) making opinions unreliable and unhelpful | Opinions address essential-feature element; will disclaim lack of opinion on non-infringing-uses; implied license facts were disclosed and related to other defenses | Denied: Dr. Springett may testify on exhaustion and repair; implied license testimony allowed but Defendants must amend his report to address implied license by a set date and permit limited deposition; he must state legal elements and may state he has no opinion on non-infringing-uses |
Key Cases Cited
- Abbott Point of Care, Inc. v. Epocal, Inc., 868 F. Supp. 2d 1310 (N.D. Ala. 2012) (defendant’s own patent may be relevant to willfulness though not a defense to infringement)
- Rolls-Royce Ltd. v. GTE Valeron Corp., 800 F.2d 1101 (Fed. Cir. 1986) (willfulness is fact-specific; no per se rules)
- King Instrument Corp. v. Otari Corp., 767 F.2d 853 (Fed. Cir. 1985) (factors for willfulness inquiry)
- Gustafson, Inc. v. Intersystems Indus. Prod., Inc., 897 F.2d 508 (Fed. Cir. 1990) (willfulness considerations)
- Union Carbide Corp. v. Tarancon Corp., 742 F. Supp. 1565 (N.D. Ga. 1990) (willfulness factors and evidence)
- State Indus., Inc. v. A.O. Smith Corp., 751 F.2d 1226 (Fed. Cir. 1985) (design-around and competition context)
- Finjan, Inc. v. Secure Computing Corp., 626 F.3d 1197 (Fed. Cir. 2010) (experts may be precluded from contradicting claim construction)
- O2 Micro Int’l Ltd. v. Beyond Innovation Tech. Co., 521 F.3d 1351 (Fed. Cir. 2008) (parties cannot present inconsistent claim constructions to the jury)
- Quanta Computer, Inc. v. LG Elecs., Inc., 553 U.S. 617 (U.S. 2008) (exhaustion requires that the sold product substantially embody essential features)
- Aro Mfg. Co. v. Convertible Top Replacement Co., 365 U.S. 336 (U.S. 1961) (combination-patent repair/exhaustion principles)
- Anton/Bauer, Inc. v. PAG, Ltd., 329 F.3d 1343 (Fed. Cir. 2003) (implied license requires circumstances of sale indicating a license)
- Cox v. Administrator U.S. Steel & Carnegie, 17 F.3d 1386 (11th Cir. 1994) (waiver of attorney-client privilege when party injects advice-of-counsel into defense)