*1 CONCLUSION the court is judgment of
The
AFFIRMED-IN-PART, REVERSED-
IN-PART, AND REMANDED.
COSTS
No costs. SIMPSONVILLE,
BBA NONWOVENS
INC., Reemay, Inc., and Fiberweb SA, Appel- Plaintiffs-Cross
lants, NONWOVENS,
SUPERIOR LLC and Trimble,
Lloyd E. Defendants-
Appellants. 02-1053, 02-1059 and 02-1101.
Nos. Appeals,
United States Court
Federal Circuit. Aug. 2002.
DECIDED: Denied Oct.
Rehearing *2 appellants. him plaintiffs-cross With P. Higgins
on the brief were John Bradley. Kirk T. *3 II, Mabry, Haynsworth
H. Sinkler Sam P.A., Greenville, Carolina, Boyd, South argued defendants-appellants. for With him on the brief were W. David Conner A. and Kevin Kauer. Of counsel on the L. brief were Albert Underhill and James Withers, Gould, P.C., D. Merchant & Minneapolis, MN. NEWMAN, LINN, DYK,
Before Judges. Circuit Opinion for the court filed Circuit Judge Dissenting opinion LINN. filed Judge Circuit DYK.
LINN, Judge. Circuit Nonwovens, Superior LLC and Lloyd (“Superior”) E. appeal Trimble denying Supe decision of the district court post-trial rior’s motions for judgment as (“JMOL”) matter of law and for a new trial. The judgment district court’s fol jury lowed a verdict in favor of Fiberweb (“Fiberweb France”) France SA on its claim in favor BBA secret (“BBA”) Simpsonville, Nonwovens Inc. on patent infringement Superior claim. appeals further the district court’s order permanently enjoining Superior from us ing, selling, disclosing or otherwise trade secrets of Fiberweb France. Ree may, (“Reemay”) cross-appeals Inc. denying district court’s order Reema/s motion trial. new Fiberweb France seeks modification of the district court’s percent order net placed appeal. pending sales be escrow Because the district court did not err in (jenying Superior’s Atkinson, Bird, motions for JMOL and William M. Alston & LLP, trial, Charlotte, Carolina, argued North a new and because the district court did not abuse its discretion in declining consolidator, using sometimes and wound on the Servo case or in for later conversion jury instruct products. into end order, forming the escrow we affirm 1 disputes, Three distinct relating to three technologies
distinct
used in the manufac-
BACKGROUND
turing process, are at issue in
appeal.
First, Fiberweb France asserted that Su-
BBA,
France, Reemay,
perior willfully«misappropriated its trade
Superior are commercial manufacturers of
technology.
chamber
Sec-
spunbond nonwoven fabrics used in the
ond, BBA
asserted that
willfully
production of
products,
such as
infringed
5,397,413
its U.S. Patent No.
*4
sheets, filters,
dryer
carpet underlay.
and
(“the
patent”)
'413
appara-
directed to an
BBA, formerly known
Fiberweb North
as
tus and method for producing a web of
America,
is affiliated with Fiberweb
thermoplastic filaments,
including claims
Reemay,
France and
as all
compa-
three
reciting a slot-draw attenuator with a coro-
(a
are
BBA
by
Group
nies
owned
PLC UK
positioned
na device
to electrostatically
corporation).
charge
Third,
the filaments.
Reemay as-
serted that
willfully misappropri-
Superior was
in early
by
formed
ated its trade
steam
secret
consolidator
employees
several former
and consultants
technology.
France,
of Fiberweb
BBA and Reemay.
employees
former
include
These
President
BBA and Reemay brought
against
suit
E.
Lloyd
Trimble and Vice-President
Superior in the U.S. District Court for the
Superior’s goal
Scott Gessner.
pro-
was to
District of
September 6,
South Carolina on
duce nonwoven
in competition
fabric
with 2000, alleging trade
misappropria-
France, BBA,
Fiberweb
Reemay.
and
patent
and
infringement.
tion
France was
plaintiff
later added as a
The
at issue relates to the
misappropriation.
trade secret
Following
manufacture of spunbond nonwoven fabric.
expedited discovery, the district court on
The manufacturing process begins with
9,
August
2001 held a Markman hearing,
polymer pellets that are melted and ex-
17,
August
and on
issued Markman
a
through
spinneret
truded
a
long
to form
1, 8, 9,
ruling construing claims
and 13 of
polymer
discrete
The
filaments.
filaments
patent.
20-31,
BBA’s '413
On August
are cooled with air
“quench
from
cham-
2001,
jury
a
trial was conducted.
bers,”
provide
stretched to
strength, elec-
trostatically charged so the filaments don’t
The jury returned a verdict in favor of
together,
deposited
bunch
onto a mov-
claim,
Fiberweb France on its trade secret
ing “laydown belt” to
a
form nonwoven in favor BBA
patent
of
on
infringement
bonded,
(claims
web of fabric.
1, 8,
The
is
13),
web
then
9,
claim
against
but
“Motion,
parties
(1975). Thus,
1. The
have submitted a
Re-
public
"the beneficial effects of
questing Issuance
Any
Opinion
of
Written
scrutiny upon
justice”
the administration of
Under Seal or Without
support
Disclosure of Confi-
presumption
public
a
in favor of
ac-
id.;
requesting
dential Information.”
judicial
The motion
cess to
records. See
Nixon v.
opinion
Communications, Inc.,
issuance
this
under seal is denied. Warner
435 U.S.
open
"Official records and
(1978).
documents
to the
98 S.Ct.
1337 (4th 182, Corp., hem Steel or further contends that the record lacks Cir.1994). (i) substantial evidence of misappropriation (ii)
of a by Superior, trade secret apply Federal courts the trade se “willful, wanton, or reckless” misappropri- appropriate cret law of the state. See by Superior, ation support sufficient to Calco, Ltd., Corp. Water Techs. v. 850 F.2d jury’s verdict. (Fed.Cir. USPQ2d 1097, 1988). bar, In at the case the defendants- 1. Existence of Trade Secret
appellants principal place have a of busi argues that Fiberweb Carolina, ness reside South -and and/or (cid:127) prove France failed to at trial alleged misappro all acts of satisfied each of Carolina, priation occurred South thus statutory requirements for existence of apply we the trade secret law of the State a trade secret under South Studs, Carolina law. of South Carolina. See Sun Inc. v. In particular, Superior Assocs., Inc., contends Applied Theory that the 772 F.2d (Fed.Cir. record lacks substantial evidence showing 1985). France’s chamber tech
nology makes a “substantial
difference
interpretation
Claim
raises issues
the efficiency
process
of a
produc
or the
of law that
this court reviews de novo.
product”
tion of a
require
and that
Techs., Inc.,
Cybor Corp. v. FAS
39-8-20(5)(b)
ments of
Ann.
S.C.Code
(Fed.
USPQ2d
(Law.Co-op.Supp.2001) are not satisfied.
Cir.1998) (en banc);
Markman West According
Superior,
because Fiberweb
*6
Inc.,
Instruments,
967, 979,
view
52 F.3d
France had the burden' of
proving
(Fed.Cir.1995)
1321,
(en
USPQ2d
34
1329
technology qualified as a trade
un
banc),
370,
1384,
aff'd, 517 U.S.
116 S.Ct.
law,
der South Carolina
see Louwndes
(1996).
S.Eüd 1972), and because evidence at trial Superior’s Appeals I. showed that quench Fiberweb France’s Superior appeals the district court’s de- chamber technology composed of a denying Superior’s cisions motions for elements, combination of well-known then JMOL or for a new trial regard with required Fiberweb France was to demon willful, wanton, Fiberweb France’s claim of strate pursuant “substantial difference” misappropriation or reckless of trade se- 39-8-20(5)(b). crets, and to BBA’s claim willful in- responds Fiberweb France that this ar- fringement patent. of the '413 We first gument was not before the district court address Fiberweb France’s trade secret merits, and is thus waived. On the Fiber- claim, patent and then discuss BBA’s web argues France its trade secret fringement claim.
technology composed is not in fact of a combination of known elements. Fiber- A. Fiberweb France’s Trade Secret web argues France that substantial evi- Superior argues that Fiberweb France dence of record establishes that each of failed to show existence of a trade quench individual elements of its secret under Superi- South Carolina law. chamber technology qualifies for trade se- veys §Ann. 39- a clear and definite protection meaning, under S.C.Code there is
cret 8-20(5)(a). for employing France ar- no occasion rules of statuto- further ” 8—20(5)(b) ry interpretation.... Ray Bell Constr. impose does not gues that 39— County, v. Sch. Dist. Co. Greenville requirement, asserted the additional (1998). S.C. 501 S.E.2d But secret, qualify as a trade Superior, that “plain language where the of the statute known elements must be a combination of equally logical interpre- lends itself to two a to “make substantial difference shown tations,” apply courts “must the rules of process produc- or the efficiency of statutory interpretation to the am- resolve product.” Finally, Fiberweb tion of a biguity and to discover the intent of the 39-8-20(5)(b) §if that even argues Assembly.” Kennedy General v. Ret. S.C. “substantial differ- imposes an additional 243, 247 Sys., 345 S.C. 549 S.E.2d evidence of requirement, ence” substantial (2001). testimony and documen- including record
tary evidence demonstrates that its governing South Carolina statutes require- satisfies this chamber secrets are modeled after the Uniform ment. (“UTSA”). Trade Secrets Act The UTSA phrase defines the “trade secret:” matter, briefly we As threshold (4) information, “Trade secret” means argu Fiberweb France’s waiver address formula, including pattern, compila- Although may ment. the court decline to tion, device, method, program, tech- “fairly address issues not raised” before nique, process or that: plain the trial court the absence of (i) independent derives economic val- Seidlitz, error, v. United States 589 F.2d ue, potential, being actual or from not (4th Cir.1978), the Fourth Circuit to, generally known being and not readi- application has endorsed the “liberal ly by proper by, ascertainable means 50(b)” Singer Dungan, v. Rule persons who can obtain economic Cir.1995). (4th See Harrison 828-29 use, from value its disclosure or Stores, Inc., Apparel Edison Bros. (4th Cir.1998). (ii) subject is the of efforts that are *7 plaintiffs at the close of moved for JMOL reasonable under the to circumstances evidence, of all of case and at the close the secrecy. maintain its challenging the of a trade existence secret (amended Unif. Trade Secrets Act 1 France. While as 1985). initially adopted South Carolina the argument in the district court was some UTSA, but later enacted the South Car- general, question what it did the raise the (“SCTSA”), olina Trade Secrets Act proven France had of whether Fiberweb to-130, §§ S.C.Code Ann. in 39-8-10 protectable the of a trade secret. existence Riedman, See Williams v. 339 S.C. standard, applicable In of the we light 28, 42 (App.2000). 529 S.E.2d n. 3 The decline to find waiver of the issue of expands SCTSA the definition of trade whether Fiberweb France satisfied the by adding types to the of informa- statutory requirements. may qualify tion that as a trade secret: (5) “Trade secret” means: begin analysis
We our with the lan (a) guage of the “If a lan statute. statute’s lim- including, information but not to, formula, guage plain unambiguous, pattern, compilation, and and con- ited (1998); device, method, Lawyer Thig Mark V. technique, olina program, pen, Age Discovery: A New Your Trade pro- process, design, system, or product, of Carolina, Are In Secrets South or code that: totype, procedure, Safe (1998). S.C. L.Rev. (i) independent economic derives SCTSA, protectability Prior the the value, potential, from not actual or by governed combination trade secrets was to, and not be- known being generally Products, Loumdes which stated: by proper readily ascertainable ing per- public any or means the in the unique A trade secret can exist value can obtain economic son who compo- combination of otherwise known use, and disclosure or from its nents; parts, by although each of its simple reasonable maintain its (b) (ii) A trade secret fact, item, is the under the circumstances secrecy. subject of efforts that or may consist of a procedure, or a are itself, the combination unified the secret. [*] may process, design % be in v may public be the essence of [*] operation domain, [*] [*] proce- or sequence or of items series generally unique [A]n combination which, individually could although dures steps can as a qualify known elements or relatively minor or sim- perceived be as secret, represents if a valuable trade it make a substantial ple, collectively can indepen- attributable to the contribution efficiency process of a difference claiming the one to have dent efforts of product, may or production or the conceived it. The combination must dif- marketing or commer- be the basis of re- materially fer from other methods effect of strategy. cial The collective prior art.... vealed con- procedures must be the items USPQ 211 (quot at at 191 S.E.2d any analysis of whether a sidered Callman, Compe The Law ing Unfair general secret exists and not tition, Trademarks, Monopolies, individual item or knowledge of each (3d ed.1968)). 52.1, §§ Federal courts 53.3 procedure. have applying Carolina law been South Am. Ins. accord. Wilkes v. Pioneer See 39-8-20(5) (Law Co-op. Ann. S.C.Code (D.S.C.1974) Co., F.Supp. enu- Beyond adding to the Supp.2001). (“It law that the fact is well settled types of information meration of all, compo of the part, eventually or even secret, a trade the SCTSA may qualify as matters of a trade secret are nents of definition, i.e., “in- provides open-ended an knowledge does not public public law or limited to.” Id. *8 cluding, but not secret.”) (citing claim of trade prohibit a enactment of the SCTSA The 1997 Distillers, v. Nat’l Imperial Chem. Indus. expand protection sought to (2d Cir.1965) (“A 737, trade 342 F.2d 742 pro-business implement to other and of charac can exist in a combination secret to make the state changes to the statute which, by components, each of teristics manu- in the more attractive businesses domain, itself, the public in but is Philip technology areas. See facturing and operation process, design unified III, combination, Trade Kilgore which, A. & Charles N. Griffin in affords unique protectable New Act and is a competitive advantage in Carolina: Secrets South secret.”)). Changes Employers, 9 S. Car- Outlook for
1340 applying
Courts the law of other states strict the definition of “trade secret” set 39-8-20(5)(a), § law basis for com forth in have cited common or to narrow the secrets, passage even after definition bination trade to exclude trade other- secrets See, e.g., Capital protectable Re of the Asset wise under that definition. UTSA. 683, Finnegan, search v. Corp. argues quench that its (11th Cir.1998) 686, USPQ2d 1855 48 technology protectable chamber aas law); Georgia Rivendell Forest (applying 39-8-20(5)(a). § trade secret under We Prods., Georgia-Pacific Corp., 28 Ltd. agree. Substantial evidence of record 1042, 1045, USPQ2d 1472, F.3d 31 1475 demonstrates that at least one of the indi- (10th Cir.1994) law); (applying Colorado vidual quench elements of its chamber de- Co., Servo Am. v. Gen. Elec. 393 Corp. of sign qualifies protection. for trade secret (4th 551, 554, 157 473 At expert least one witness testified Cir.1968) law); BioCore, Virginia (applying the individual quench elements of the Khosrowshahi, F.Supp.2d Inc. v. 96 chamber technology “very at issue were (D.Kan.2000) law); (applying Kansas novel,” unusual,” “really quite “very, Motorola, Inc., F.Supp. Nilssen v. very unusual.” (N.D.Ill.1997) law); (applying Illinois Ehmke, Leasing Enter. Phoenix v. Co. Further substantial evidence the rec- 197 Ariz. 3 P.3d supports finding ord that the combina- USPQ2d (App.1999) (applying qualifies protection tion itself under law). Many Arizona of the cases from Although Lowndes Products. Superior jurisdictions Imperial cite for its published cites various showing references Rivendell, definition of trade secret. See summary descriptions of similar technolo- 1045, USPQ2d 1475; 28 F.3d at at Nils gy, substantial evidence of record estab- sen, 677; F.Supp. Imperial, at particular lishes that the combination used F.2d at 742.. by Fiberweb generally France was not readily known or pub- ascertainable pointed provision has to no lic. We decline to find that the SCTSA statute, none, and we can find indicat- narrowed the definition of “trade secret” ing legislature that the South Carolina from that existing under the common law. to narrow the definition of a tended trade enunciated in Lowndes Products. Moreover, substantial evidence of record 39-8-20(5)(b), § Superior cites but this supports protection of Fiberweb France’s narrows, provision expands, than rather quench technology chamber under 39-8- protection 20(5)(b). trade Contrary secrets. Documentary evidence and testi- assertions, 39-8-20(5)(b) is mony appears showing record permissive not restrictive. Use lan- Superior’s officers considered the details of (i.e., of’), “may guage consist rather than design impor- chamber to be “must”), mandatory language (e.g., production, tant to implying that Fiberweb provision demonstrates the intent of the France’s does make a differ- legislature expand South Carolina production ence in the of the nonwoven fact, secret protection simple to “a product, item or fabric end and that difference is *9 procedure, a sequence or series or of Superior items cites no evidence substantial. procedures” or which tending meet certain condi- contrary. to show the Under tions. provi- circumstances, There is no indication in this these we decline to find a sion that the legislature intended to re- lack of support substantial evidence to (a) of a trade secret of an- acquisition that Fiberweb finding presumed jury’s means; person by improper aby of a trade the existence established Corp. v. Com Perkin-Elmer secret. See (b) of acquisition of a trade secret 888, 893, 221 Corp., putervision person a who knows or has another (absent (Fed.Cir.1984) in USPQ to know that the trade secret was reason necessary sup to findings terrogatories, means; by improper or acquired presumed); ac are jury verdict port (c) a trade secret disclosure or use of Acme-McCrary Corp., Tights, Inc. cord express implied without or of another by person a who: consent (4th Cir.1976).
(i) improper acquire used means to Misappropriation secret; 2. Evidence of the trade or knowledge (ii) use, at the time of disclosure or jury that the ver Superior argues know that his knew had reason to or of Fiberweb misappropriation dict of secret was: knowledge of cannot stand for lack trade secret France’s misappropria evidence of substantial (A) per- through derived from or a it became argues that tion. improper son who had utilized information trade secret aware of the it; acquire means to contractor Scott independent through (B) by mistake or under acquired Gessner, rela had no master-servant who duty a giving circumstances rise to Superior contends Superior. tionship with secrecy or limit its passed while to maintain its information was consultant, use; merely a or was Scott Gessner becoming an officer of prior to his (C) per- through from or derived Superior of thereby relieving corporation, person duty to the son owed who liability. any secre- relief to maintain its seeking use; limit or cy evidence or argues that no Superior further had an en- that Gessner was introduced (iii) change of his a material before with agreement forceable nondisclosure to know knew or had reason position, existed, if France. Even one and that a trade secret it was it was nullified according Superior, acquired it had been knowledge of reply failed to Fiberweb France when accident or mistake. requesting clarification letter Gessner’s (Law 39-8-20(2) Co-op. Ann. S.C.Code secret. was considered what information Supp.2001). Trimble that Dr. Superior contends under the SCTSA does Misappropriation the infor-' misappropriated could not have any master- turn on the existence not evi- there was insufficient because mation The definition relationship. servant know had reason to that he knew or dence aóf “acquisition includes misappropriation considered the tech- that Fiberweb France who knows or by person ... a trade secret. to be nology question that the trade reason to know has in the “Misappropriation” is defined Id. improper means.” acquired by SCTSA: argu- Superior’s master-servant findWe dispositive irrelevant (2) ment to be “Misappropriation” means: *10 Wanton, Willful, or quench chamber Reckless issue of whether (i.e., by person a acquired formation was willful, Superior argues that wan Trimble) who knew or had or Gessner misappropriation requires ton or reckless by acquired that it was reason to know aggravation some element of or malice. improper means. Superior contends that the evidence in this suggests case the defendants were moti an enforceable nondisclosure As for by competition vated and not malice or an record shows that Gessner agreement, the by aggravation. argues element of he was bound nondisclosure believed good that in faith includes Gessner acted when agreement. The record Gessner’s not “Confidentiality sharing the information because he did acknowledging letter personally technology believe that the signed,” request- which I and Agreements a trade for question what was asked ing a clarification of Fiberweb secrets, clarification before the informa sharing which France considered its Thus, than tion. response. rather received no of an enforceable non- showing an absence argues Fiberweb the statute agreement, the record instead disclosure willful, wanton, has a or reckless standard evidence of existence shows substantial aggravation and no or malice need be agreement. such an Fiberweb France’s agree. shown. We S.C.Code Ann. 39- hardly letter reply
failure to to Gessner’s 8-40 states: agree- to rescind the signifies an intention (A) complainant A is entitled to recover ment, Fi- contrary may on the show damages misappropriation actual preserve France’s intention to berweb trade secrets. trade secret. ij; :]s misappropriation by Trim
As for ble, the record includes substantial evi (C) wanton, Upon finding willful, showing that Trimble had reason to dence plaintiffs disregard or reckless of the information secret and had know the rights, may separate the court award by improper Trim acquired been means. exemplary damages in an amount not employed by ble had been any twice award made under exceeding France and hence knew or should have (A). subsection known that Fiberweb France maintained (Law Co-op. S.C.Code Ann. 39-8-40 technology quench chamber as se added). Supp.2001) (emphasis No malice cret. Trimble admitted that he had ac aggravation appears or standard in this during employ his cess to the information provision. Although Superior cites cases documents, Company ment Fiberweb. standard, support of a including malice testimony, per confirmed show that he Railway, Eberle v. Southern 98 S.C. sonally the transfer of the infor directed (1913), S.E. v. Allen Cohen contractors, pur mation to outside for the Co., Bottling dale Coca-Cola 291 S.C. pose including Fiberweb France’s (App.1986), pre 351 S.E.2d those chamber interpret governing cedents do not production facility. We find substan statute. supports jury tial evidence verdict of Moreover, misappropriation of supports Fiberweb France’s the record a find- ing misappropriation. trade secrets. of willful Trimble
1343 The district Superior appeal. on infor- raised to the had access that he admitted he corona means of agreed shows that court that the evidence and the mation limitation, of the means-plus-function transfer directed the claim 1 is a personally contractors, the for outside to includes fur- formation that the claim also but found France’s including Fiberweb purpose location, “posi- language designating ther Superior’s in chamber quench fil- electrostatically charging the tioned to continued facility. Gessner production deposited ... are on they before aments Germany LTG project the when support court surface.” The district said collection fa- Superior’s help design to tapped per- of the claim language that the found knew that though cility, even Gessner outside, albeit mits the corona means to be with Fiber- Germany was familiar LTG to, the The district connected attenuator. design. Su- chamber France’s secret web Superior’s prosecution court addressed design, the pursue continued perior prose- that the history argument but found by its contractor being after told even limit in history failed to the claims cution the whether not confirm that it could by Superior. way argued the the same were designs chamber alia, recites, inter because Claim as Fiberweb France’s We find were secret. designs France’s d) cooperating with said corona means jury’s willful- to the challenge positioned for electro- attenuator and up- verdict, court’s order ness the filaments so that statically charging the it, merit. holding to be without in the fila- repelling forces are induced the fila- uniformly spread ments to more B. Patent BBA deposited on said they ments before are surface to form web. collection the district that Superior argues the claims of construing in erred court 9,11. col. 32-37. patent, ’413 Superior argues that patent. BBA’s '413 correctly con court As the district means,” means-plus-function as a “corona cluded, means” is limitation “corona the limitation, embodiments dis limited to is form, and thus is sub equivalents, plus function specification in the means closed in the disclosed only the embodiment of 35 U.S.C. requirements the ject Med., within the corona means patent shows 112, '413 B. Braun six. See paragraph of the 1424, the four walls attenuator. Labs., 1419, F.3d Inc. v. Abbott appli during prosecution, argues (Fed.Cir.1997) 1896, USPQ2d limiting the prior art distinguished cant (“Because expressed limitation is to be “within” the corona means position of be language and plus function’ ‘means at a location the slot draw attenuator definite structure it does not recite cause Su slot of the attenuator. the exit above function, subject to its it is support in accused device perior argues ¶ of 35 U.S.C. requirements positioned device an electrostatic cludes (1994).”). a limitation of such Construction attenuator, and the exit slot of below identify the first the court requires claims, a col require that which thus limita means-plus-function function of the adjacent the positioned be lection surface corresponding identify next tion and slot, the accused device. fail to read on exit description neces written in the structure Micro function. perform that sary to claim construction The district court’s Co., 194 Chem., Chem. Inc. v. Great Plains arguments August addressed USPQ2d “adjacent” limitation, similarly unper- *12 (Fed.Cir.1999). recites, suasive. Claim 1 “a collection sur- positioned face adjacent said exit slot of Superior argues that the recited function 9,11. said attenuator.” patent, '413 col. 28- electrostatically charging includes “for the contention, Superior’s 29. that the collec- they deposited filaments ... before are on adjacent tion surface cannot be the exit said to form a collection surface web.” We slot if the corona means not is within the disagree. correctly The district court attenuator, is without merit. Just because identified the recited function: the corona means is located outside the corresponds The “function that to the attenuator, and connected to the attenua- portion “means” of Claim 1 stems tor, does not mean that the collection sur- “corona”; is, from the word that the precluded face adjacent is from being to properly claim if read as it said the attenuator exit slot. Again, Superior forming “means corona.” invites ignore “positioned” us to the limita- tion in favor of restricting the corona Superior’s proposed ignores construction “positioned” the word in claim means to that patent as the shown the figures. district court observed. Rather than recit- Superior’s Because construction reads a means, ing the function of the corona the claims, limitation out of the we decline expression following “positioned” the word Superior’s invitation. describes where the corona means is locat- We find arguments concern- separate ed and is a subject limitation not ing claims unpersuasive and 13 to be paragraph section 6. What the “co- for similar reasons.
rona means” is and where it is located are two things. different II. Cross-Appeals
Superior’s argument that the “corona means” must be “within” the slot draw Reemay A. Trade Secret misplaced. attenuator is The “within” lim- proposed by Superior itation ap- does not Reemay argues pursuant pear prosecution in the claim. The history the holding court’s in Servo Corp. Amer applicant shows that the prior described a Co., ica v. General Electric reference, Japanese 60-94663, art Pat. No. (4th USPQ Cir.1968), the district by noting that it applying “discloses a co- court was required to exclude from the rona to filaments after the filaments have evidence certain expired patents not relied attenuator,” an applicant exited but the did upon by Superior in developing the ac not distinguish this on reference that basis. cused technology. Reemay argues that Instead, applicant the distinguished this requires Servo exclusion of references that referring reference as “tube-type round do not “completely ]” disclosef attenuators and not to a slot draw attenua- secret or make the trade secret “so obvi tor,” having a different filament con- ous as to render meaningless the confiden figuration. canWe find no error in the tial relationship” parties, between the if district finding court’s the intrinsic the reference was not actually upon relied evidence require does not that the corona by the accused. Id. at at means be “within” the attenuator. 474. Reemay argues that the district
Superior’s argument that the
court
claims fail
abused its
discretion
admitting
device,
to read on the accused
due to the
expired patents
refusing to
mation,
and remanded for
determination
concerning the Servo
jury
instruct
an instruction that
damages,
with
case.
was to base
determination
district court
ad-
did not
that Servo
Superior argues
portion
proprietary
on that
Servo’s
case,
in this
presented
the issue
dress
had not been
dis-
publicly
formation which
crite-
satisfied the
whether
10, 1958, the
April
closed as of
date
Supe-
a trade secret.
protection as
ria for
at
misappropriation by GE. Id.
that substantial evidence
rior contends
remand,
USPQ at
On
district
*13
trial,
limited to the ex-
at
not
presented
in
that “the
detector
court
Servo
concluded
issue,
Ree-
showing that
at
patents
pired
publicly dis-
entirety had not been
its
pro-
qualify
not
for
technology did
may’s
$50,000.
closed,”
damages
and awarded
of
a trade secret.
tection as
Id.
case is
that the Servo
Initially, we note
and
again
The Fourth Circuit
reversed
in-
involved
Servo
binding precedent.
not
found
Id. The court
that
remanded.
law, not South
Virginia
terpretation of
findings lacked sufficient
district court’s
in
law,
court
thus the district
and
Carolina
which information
specificity regarding
necessarily
by
not
bound
case
556,
disclosed.
Id. at
publicly
had been
of substantive
interpretation
USPQ
474. The court also com-
157
at
Elec.
Am. v.
Corp.
Gen.
law. See Servo
every signifi-
defense that
mented on GE’s
2,
USPQ n.
Co.,
n.
85
F.2d
device
been
aspect
the detector
had
cant
Cir.1964).
(4th
April
1958:
prior
publicly disclosed
allegation that GE
involved an
Servo
in
that
those instances
We do not believe
for
box
patents
two
“hot
infringed
had
argua-
where the extent of disclosure
detectors,”
“in
railroad
devices used
ble,
not
the information had
and where
abnormal
industry
quantity
to detect an
domain,
public
clearly placed
been
journal
emanating
freight
from
car
heat
be allowed to
should
General Electric
552,
These statements the Fourth Circuit were made in Servo the context of “a B. Fiberweb France Royalty breach confidential relationship.” of a Id Escrow Order The court considered the confidential rela- tionship to be central to the cause of ac- Fiberweb France challenges the dis- tion, any ‘public disclosure’ defense trict court’s order staying imposition of necessity would of have to be so sweeping injunction prohibiting Superior from negate relationship, as to to avoid the misappropriating Fiberweb France’s consequences of breach: secret, directing per- that 10 cent of
Servo cannot recover for net appropriation placed sales be escrow pending appeal. of information which had been so com- *14 pletely public argues disclosed to the that this as to dis- order fails to ac- count pel the existence of a trade secret during sales two negate thus period the confidential months of misappropriation, relation- ship September which had been established Ser- October of 2001. Wheth- vo er and Southern between and to what injunction themselves. extent an awarded in this case are firmly matters (citations omitted). Id within the discretion of the district court. case, present In the the determination 39-8-50(A) (Law See S.C.Code Ann. whether Reemay’s consolidator technology (“Actual Co-op. Supp.2001) or threatened qualifies for protection does (em- misappropriation may enjoined.” be not turn on the breach of a confidential added)). phasis We find no abuse of that Thus, relationship. inapposite Servo is un- discretion here. circumstances,
der these and the district court did not abuse discretiomby refus- CONCLUSION ing jury to instruct concerning the case. Because the district court did not err in denying Superior’s motions for JMOL and Reemay’s argument that Servo man- trial, a new we affirm appeal. on Because dates exclusion of unexpired pat- certain the district court did not abuse its discre- similarly unpersuasive. ents is tion in admitting certain evidence and de- Reemay’s introduced evidence that consoli- clining to instruct jury on the Servo dator technology was available in prior case, order, or in forming the escrow we art, and thus was not secret. Although affirm on cross-appeal. Reemay contends that Servo decrees such evidence to be irrelevant if not sufficient to AFFIRMED. “render meaningless” a confidential rela- tionship, Servo establishes no such rule DYK, Judge, Circuit dissenting-in-part. outside the context of breach of a confiden- tial relationship. join The I expired patents the majority opinion are insofar as it relevant to the question of the existence of holds that the district court properly de- a trade secret under Superior Nonwovens, the SCTSA. nied See L.L.C.’s motion 39-8-20(5) (Law S.C.Code Ann. Co-op. for JMOL and a new trial as to infringe- Simpsonville, independently that can be controlled. Id. BBA Nonwovens ment of 5,397,413 Figs. at Patent patent, U.S. No. Inc.’s (“the properly denied Ree- patent”), '413 A Synthetic book entitled Formation of for a new trial as to
may, Inc.’s motion systems Fibers states that of cool- “[t]wo secret, and of its trade misappropriation ing they emerge the hot filaments after respect its discretion with did not abuse spinnerette from the are common use. However, respectfully I order. the escrow The older still more often used method majority’s up- from the decision dissent commonly bears the name of cross-flow that Fiber- holding jury determination Wakzak, quench.” Zbigniew K. Forma- France”) (“Fiberweb dem- web France SA (1977). Synthetic Fig- tion Fibers protectable of a onstrated the existence depicts 5.1 of ure the book cross-flow view, my In should trade secret. JMOL quench chamber with six horizontal zones. no reasonable granted have been because undisputed Id. at 152. It is that the use properly conclude that Fiber- jury could multiple zones in quench chamber was pro- proven expert that it had a known. generally web France had Plaintiffs own Dr. acknowledged: Smorada trade secret. tectable
COUNSEL: 1. The number zones particular Smorada, you agree Dr. do that the is not a trade secret. itself expired patents you materials reviewed in this case on the *15 majority opinion that Fiber- The finds independently chamber show con- a trade secret web demonstrated anywhere trolled zones from to 6 to 15 respect particular to the number of with quenches spunbond zones on in the quench range in the chamber the zones industry? (I identify- refrain from of six to fifteen. DR. SMORADA: particular the number because of the ing majority’s particular conclusion that the mul- There are a number of claims of secret). I number of is a trade zones tiple quenches. zone disagree particular that the number of sure, testimony that the To be there was in the chamber is a trade zones by particular number of zones selected patent An expired secret. United States and “very Fiberweb France was novel” prior publication plainly art dis- and “very, very unusual.” To establish a trade in a multiple the use of zones closed law, however, secret under South Carolina quench chamber. than that the one must do more assert is “novel.” Rath- question information 3,274,644 Patent No. United States er, must show that the information one Massey (“Massey”) depicts et al. value, independent economic ac- “derives quenching molten fil- quench chamber “for potential, being generally or from not tual aments” with fifteen horizontal zones to, being readily and not ascertain- known sliding plate dampers describes use public any by proper by able means or independently control air flow each person who can obtain economic val- other spinning filamentary zone in “the melt ue from its disclosure or use.” S.C.Code polymeric Massey, materials nature.” added). 8—20(5)(a)(i)(emphasis Ann. 39— 12-17, Fig. patent 11. 4. The col. figures illustrating quench showing particu- two There no that the shows independent had eco- multiple with horizontal zones lar number chosen chambers qualify 39-8-20(5)(b) (Law nomic value that would it as a S.C.Code Ann. Co added). secret. op. Supp.2001) (emphasis Thus the “material difference” standard re quires showing alleged combina no showing There was that the combi- tion represents a “valuable contri materially” nation secret “differfs] ie., bution,” superior it has economic methods revealed in the from prior value over the art. This is in accord prior art. general with trade secret law. See Riven- Alternatively majority concludes Prods., dell Forest Ltd. v. Georgia-Pacific that Fiberweb France demonstrated the Corp., USPQ2d existence of a combination trade secret (10th Cir.1994) (“[A] trade se consisting particular of the number of system cret can include a where the ele quench chamber zones combined with oth- domain, ments are in public but there er known elements. Ante at 1340-41. has accomplished effective, been an suc Again I disagree. majority must The rec- cessful and integration valuable of the Products, ognizes that ” Lowndes Inc. v. public domain (emphasis elements .... Brower, 259 S.C. 191 S.E.2d 177 added)); Integrated Servs., Mgmt. Cash (1972), USPQ governs In case. Transactions, Inc., Inc. v. Digital Lowndes, accordance with a “unique com- 171, 174, (2d USPQ2d Cir. of generally bination known elements or 1990) (“[A] trade secret can exist in a steps secret, qualify can a trade as if it combination of compo characteristics and represents a valuable contribution attrib- nents, which, itself, each is in the independent utable to the efforts of the public domain, process, but the unified de claiming one to have conceived it. The sign operation which, in unique combination must materially differ from combination, competitive affords a advan other methods revealed prior art. ....”) added) tage (citation (emphasis ...” 191 S.E.2d at at 211 omitted); Servs., Water Inc. v. Tesco *16 Coliman, (citing The Law of Unfair Chems., Inc., Trademarks, Competition, and Monopo- (5th Cir.1969) (finding combina (3d ed.1968)) added). (emphases lies 53.3 tion trade secret where the combination of appears This standard also in essence in generally known “unique elements was the South Carolina Trade Secrets Act: a substantial competitive advan conferred ” A may trade secret simple consist of a tage in that company enjoyed “the unpar fact, item, procedure, or or a series or alleled financial success during the four- sequence which, procedures, of items or years competitors were unsuccessfully try although individually perceived could be secret].”) (em ing duplicate [trade relatively as minor or simple, collectively added). phasis can make a substantial in the difference The record here shows that there was a efficiency a process production or the of complete proof absence of that the use of a a or product, may be the basis particular number of zones within the marketing strategy. or commercial The quench chambers in collective effect of the combination with oth- proce- items and er qualified dures must be considered in elements any analy- as a trade secret sis of whether a trade under secret exists and materially” “differ[s] test. not general knowledge of each indi- There testimony was no making here vidual procedure. item or comparison between this combination and they “differ[ed] how to show art prior Walcek, Stanley Al- WALCEK, Delores At value. economic in terms materially” Ammons, Regina Walcek, and bert admitted counsel plaintiffs argument oral Plaintiffs-Appellants, be- been made had comparison no that here and alleged tween methods: any other Defendant-Appellee. STATES, UNITED
THE COURT: testimony this any there Is No. 01-5108. compared as process, Appeals, Court States United dif- a substantial made technologies, Circuit. Federal ference?
COUNSEL: Sept. words they used those know if I don’t said Dr. Eschbach but
specifically, which profile,” the best “this was mind. his comparison
suggests comparing evidence submit didn’t
We
A B. added).
(Emphasis to is referred testimony counsel
The Eschbach, that: testified who Dr.
that of
COUNSEL: the number is contention your
So the hori- vertical side in the
zones secret? also trade
zontal is
MR. ESCHBACH: com- It’s us, secret. it’s a trade
For experience our from
ing outside profile it that defined
we have one.
the best added).
(Emphasis plain- relied on evidence
The record to establish inadequate quite
tiff is “dif- trade secret combination alleged already known materially” from
fer[s] plain- I hold that Thus would
technology. aof the existence establish
tiff failed law. under South Carolina