Litton Industrial Products, Inc. (“Littón”) appeals from the decisions 1 of the United States District Court for the Western District of Washington (“district court”) that U.S. Patent No. 3,368,280 2 (“ '280 patent”) is invalid and that Litton violated the Washington Consumer Protection Act, Washington Revised Code § 19.-86.020. Solid State Systems Corp. (“Solid State”) cross-appeals the district court’s decjsion 3 denying an award of damages and attorney fees for Litton’s violation of Washington Revised Code § 19.86.020. We reverse ¡n part> and vacate and remand in part
BACKGROUND
The ’280 patent, as shown in Figure 2 below, is drawn to an ultrasonic device 11 for cleaning teeth with a vibrating work tool 12. Liquid, such as water, is directed through passages 32 and 34 in housing 14 and bores 46 and 50 of shank 44. From bore 50, the liquid bridges across bent portion 54 to impinge distal end 52. Shank 44 is connected to housing 14 by threaded end 48.
Claims 1, 2, and 3 are illustrative:
1. A work tool for an ultrasonic dental device comprising a shank portion adapted to be connected to a connecting body m the device and a single portion : ® . projecting from the shank and termmat-ing in an angled distal work tool end, said shank having a fluid path there-through with a mouth arranged to direct a stream of water flowing through the shank to impinge on the distal end.
2. A work tool as set forth in claim 2 [sic, claim 1] wherein the said shank is provided with a first and a second recess, J 1 ® “j? Recess comprising a seat to hold the portion and the second recess . . ,, , , , comprising a through bore to commum-cate with an axia] bore in the shank of the tool, whereby a stream of water is adapted to be directed to the second bore to impinge on the distal end of the tool,
3. A work tool as set forth in claim 2 wherein said angled tool end is formed *160 by a dog leg bend intermediate the distal end and its connection to the shank so that the stream of water bridges the dog leg in flight to impinge on the distal end.
Two weeks prior to the filing date of the '729 application, 4 Robert J. Blank and Bruce Richman filed patent application No. 533,362 5 (“Blank application”), which was also assigned to C & B. On July 26, 1967, before any prior art was cited against the claims of the ’729 application, Bruce Rich-man received a letter from his patent attorney, Theodore Bishoff, regarding the Blank application (“Bishoff-Richman letter”). One portion of this letter discussed the pertinence of U.S. Patent No. 3,075,288 to Lewis Balamuth, et al. (“Balamuth ’288”) 6 to the ’729 application as follows:
It should be clear that Balamuth [’288]’s Figure 9 anticipates the structure of the liquid passage not only in the transformer or work tool support, but his showing of a slot 138 in the work tool also appears to substantially anticipate your joint and 2nd application with Dr. Charles Friedman [the ’729 application].
Despite this letter, Balamuth ’288 was not cited to the U.S. Patent and Trademark Office (“PTO”) during prosecution of the ’729 application.
As shown below, Figure 9 of Bala-muth ’288 depicts internal passages in ultrasonic dental tool 6 for supplying water to tool 30. By pressing button 136, collar 132 moves against the bias of spring 134 to lift valve plug 130 away from its normally closed position so that water within the tool flows through passages 128 and 127. Slot 138 permits water to leak from passage 127 to tool 30.
In issuing the ’280 patent, the PTO did, however, consider, inter alia, U.S. Patent No. 2,874,470 to James R. Richards (“Richards patent”) 7 and U.S. Patent No. 2,792,-674 to Lewis Balamuth, et al. (“Bala-muth ’674”). 8
Richards, as shown below in Figure 1, discloses a dental tool 10, which oscillates at high frequency for drilling teeth and filling cavities. Work end wall 31 of tool 10 is provided with a hole 32 through which water from the interior 28 flows to the working area 33 of a tooth. As an alternative to the straight work tip 34 in Figure 1, Richards also suggests angled work tips.
*161
Balamuth ’674 discloses an ultrasonic machine tool, as shown in Figure 1 below, for cutting, grinding, or boring. The tool comprises a mechanical vibration generator 2, a tool holder 6, and a tool 8. Flange 7 of tool holder 6 has a transverse passage 46, which communicates with longitudinal passages 48, to deliver water to work area 50 via grooves 44.
On September 23, 1970, Litton purchased all the stock and assets of C & B including the ’280 patent. In 1974, Litton brought actions against Sybron Corporation (“Sy-bron”) 9 and against Johnson & Johnson, Inc. and Key Pharmaceuticals, Inc. (“Johnson & Johnson”) 10 for infringement of the ’280 patent. In the former action, Sy-bron sought to invalidate the ’280 patent for failure to disclose Balamuth ’288 to the PTO. In the latter action, when Johnson & Johnson requested the production of documents, including the Bishoff-Richman letter, Litton’s outside counsel read the letter to determine whether it was privileged.
On November 6, 1973, Litton sent Solid State a notice of infringement and a copy of the ’280 patent. In June, 1979, Litton brought suit against Solid State for infringement of the ’280 patent. In answering Litton’s complaint, Solid State denied infringement and raised, inter alia, the following affirmative defenses with respect to the claims of the ’280 patent: invalidity under 35 U.S.C. §§ 102 and 103 and unen-forceability for fraudulently withholding Balamuth ’288 from the PTO. In addition, Solid State counterclaimed for a declaratory judgment that the ’280 patent was invalid, unenforceable, and not infringed. An injunction, damages, costs, and attorney fees were sought by Solid State.
On October 25, 1979, Solid State moved for summary judgment on the grounds that the ’280 patent was invalid under 35 U.S.C. §§ 102 and 103. The district court denied the motion under 35 U.S.C. § 102, because it found that the requirements for anticipation were not met. The motion under 35 U.S.C. § 103 was, however, granted with respect to claims 1-4 of the ’280 patent, the
*162
court finding that there was no genuine issue with respect to the factual inquiries mandated by
Graham v. John Deere Co.,
Litton filed a notice of appeal with the United States Court of Appeals for the Ninth Circuit, but later withdrew it.
On May 25, 1982, Solid State filed an amended answer and counterclaim, which added counterclaims alleging that Litton engaged in unfair competition under the Lanham Act, 15 U.S.C. § 1125(a), and Washington Revised Code § 19.86.020. 12 The unfair competition counterclaims were based on Solid State’s allegation that Litton refused to sell the invention of the ’280 patent and that Litton threatened to file and did file infringement suits, all with knowledge that the ’280 patent was obtained by inequitably failing to disclose Ba-lamuth ’288 to the PTO.
The Lanham Act claim was dismissed on summary judgment, but, after a trial on the claim under Washington Revised Code § 19.86.020, the district court issued a memorandum decision holding Litton liable. Based on the Bishoff-Richman letter, it held that the examiner would have considered Balamuth '288 important in deciding whether to allow the ’729 application, and that the '280 patent would not have issued had Balamuth ’288 been disclosed. Accordingly, the failure to call Bala-muth ’288 to the examiner’s attention was held to constitute fraud 13 on the PTO, which Litton became aware of during the infringement actions against Sybron and Johnson & Johnson. In view of Litton’s refusal to sell the claimed invention, its threats to enforce the ’280 patent, and its commencement of suit against Solid State, all with the knowledge that the ’280 patent was obtained by inequitable conduct, the district court held that Litton engaged in unfair competition under Washington Revised Code § 19.86.020.
In a separate memorandum opinion on damages, the district court concluded that Solid State's alleged loss of sales to Inter-nat Services, Pelton & Crane Co., and S.S. White Dental Products Company were not due to Litton’s violation of Washington Revised Code § 19.86.020. Solid State was, however, awarded $7,000 (plus interest) in costs and attorney fees incurred while defending against Litton’s patent infringement action.
Litton and Solid State filed notices of appeal and cross-appeal, respectively. Subsequently, Solid State moved to dismiss Litton’s appeal from the district court’s order granting summary judgment and holding claims 1-4 of the ’280 patent invalid, because Litton did not appeal within 30 days of that order. Fed.R.App.P. 4. The *163 motion was denied in an unpublished order, dated March 13, 1984, because the district court’s order was not a final judgment and, therefore, was subject to revision at any time prior to such judgment.
ANALYSIS
_ . 1. Summary Judgment on Obviousness
It is well settled that obviousness is a question of law based on the following factual determinations: (1) Scope and content of the prior art; (2) The differences between the prior art and the claimed invention; (3) The level of ordinary skill in the pertinent art; and (4) Other (“secondary”) considerations, which may serve as indicia of unobviousness.
Graham v. John Deere Co.,
Although patent infringement suits often involve numerous complex factual issues, trial courts may decide an obviousness question by summary judgment under Federal Rule of Civil Procedure 56 where there is no dispute over the underlying factual determinations.
Chore-Time Equipment, Inc. v. Cumberland,
Litton attempts to raise issues of fact with respect to the scope and content of the prior art by referring to the testimony of Litton’s former project engineer for dental scalers, Dale 0. Cranston (“Cranston”), at the unfair competition trial. Such testimony, coming after the motion for summary judgment was granted, cannot retroactively raise an issue of material fact. In attempting to overturn the district court’s decision on summary judgment, Litton must point to an evidentiary conflict created on the record at least by a counterstatement of fact jn its opposition to the motion for summary judgment.
See Barmag Barmer Maschinenfabrik AG v. Murata Machinery Ltd.,
Further, there is no dispute with respect to the differences between the prior art and the claimed invention. Although Litton cites various deficiencies in the teach-ings of Richards, Balamuth ’288, and the Ewen and Sorrin articles, these shortcomings were noted by the district court and, of course, not disputed by Solid State. It appears that Litton’s problem with the dis-trict court’s decision on differences be-tween the prior art and the claimed invention goes only to the ultimate question of obviousness. This being a question of law, a dispute on its ultimate resolution cannot raise a genuine issue of fact needed to prevent summary judgment,
Litton also faults the trial court for not making a specific finding on the level 0f or<jinary skip in the art, relying instead on the level of skill of a common layman as the standard most favorable to Litton. A specific finding on the level of skill in the art is not, however, required where the prior art itself reflects an appropriate level
*164
and a need for testimony is not shown,
Chore-Time Equipment, Inc.,
As to other considerations, Litton’s opposition to the motion for summary judgment stated that it would be urged at trial that the invention claimed in the '280 patent had been a commercial success; however, such conclusory statements are not alone sufficient to raise a genuine issue of fact.
Barmag Barmer Maschinenfabrik,
Although technically the district court’s decision on summary judgment was correct because of Litton's failure to raise any factual issue, it must be overturned if the court engaged in a faulty analysis in applying the law to the facts and a correct application of the law to those facts might bring a different result.
Union Carbide Corp.,
It is elementary that the claimed
invention
must be considered as a
whole
in deciding the question of obviousness.
E.g., Stratoflex, Inc. v. Aeroquip Corp.,
In view of the district court’s failure to consider the claimed invention as a whole, we vacate its holding of invalidity and award of attorney fees and costs incurred by Solid State in defending against Litton’s infringement action, and remand for further proceedings.
We recognize that, in some cases, it may proper for an appellate court which disagrees with a district court’s decision grant-jng summary judgment in favor of the movjng party, to reverse and remand with instructions to award summary judgment ¡n favor 0f the nonmoving party. 6 J. Moore, W. Taggart & J. Wicker, Moore’s Federal Practice § 56.12 (2d ed. 1984); 6 Part 2 J. Moore & J. Wicker, Moore’s Federal Practice § 56.27[1] (2d ed. 1984). However, we believe it is more appropriate in this case to vacate the district court’s decision and remand for further proceedings, because it is not clear that all facts bearing on obviousness are before us. 14 Id.
*165
On remand, the district court should determine whether Solid State has established that the claimed invention as a whole would have been obvious to one of ordinary skill in the art rather than to the judge or to the common layman.
Environmental Designs, Ltd.,
2. Unfair Competition under Washington Revised Code § 19.86.020
As noted earlier, Solid State’s unfair competition claim is based entirely on the allegation that Litton asserted the ’280 patent knowing that it was procured by inequitably failing to disclose Balamuth ’288 to the PTO. Accordingly, if the failure to disclose Balamuth ’288 was not inequitable conduct, Solid State’s claim under Washington Revised Code § 19.86.020 cannot succeed.
Having arisen under Washington State law, Solid State’s unfair competition claim must be decided by looking to the law of that state as declared by its legislature in a statute or by its highest court in a decision.
15
Erie Railroad Co. v. Tompkins,
We are not, however, completely without guidance in deciding how the Supreme Court of Washington would rule, because the Washington Consumer Protection Act, Washington Revised Code § 19.86.920, provides;
Purpose — Interpretation — Liberal construction — Saving. The legislature hereby declares that the purpose of this act is to complement the body of federal law governing restraints of trade, unfair competition and unfair, deceptive, and fraudulent acts or practices in order to protect the public and foster fair and honest competition. It is the intent of the legislature that, in construing this act, the courts be guided by final decisions of the federal courts and final orders of the federal trade commission interpreting the various federal statutes dealing with the same or similar matters and that in deciding whether conduct restrains or monopolizes trade or commerce or may substantially lessen competition, determination of the relevant market or effective area of competition shall not be limited by the boundaries of the state of Washington. To this end this act shall be liberally construed that its beneficial purposes may be served.
It is, however, the intent of the legislature that this act shall not be construed to prohibit acts or practices which are reasonable in relation to the development and preservation of business or which are not injurious to the public interest.
This Act has been judicially recognized as indicating to state courts that they should be guided by the interpretation federal courts give to corresponding federal statutes.
State v. Black,
As to cases involving the alleged maintenance and enforcement of a patent obtained by inequitable conduct before the PTO, the relevant starting point in federal law is
Walker Process Equipment, Inc. v. Food Machinery & Chemical Corp.,
(1) the relevant patent is shown to have been procured by knowing and willful [inequitable conduct] practiced by the defendant on the Patent Office or, if the defendant was not the original patent applicant, he had been enforcing the patent with knowledge of the [inequitable conduct] in which it was obtained; and
(2) all the elements otherwise necessary to establish a § 2 [of the Sherman Act] monopolization charge are proved.
Where the above conditions are proven, treble damages under Section 4 of the Clayton Act are recoverable from the patentee or an assignee who maintains and enforces the patent, knowing of its infirmity. Id.
The State of Washington being located within the Ninth Circuit, the Supreme Court of Washington would be guided by that circuit’s pronouncements on
Walker Process
in order to “complement” federal law, as suggested by Washington Revised Code § 19.86.920. Under Ninth Circuit case law, establishing that a patent was procured by knowing and willful inequitable conduct before the PTO for
Walker Process
claims requires a showing of materiality and intent by clear and convincing evidence.
17
Cataphote Corp. v. DeSoto Chemical Coatings, Inc.,
Although the district court made no express finding on the intent underlying
*167
Bruce Richman’s failure to cite Balamuth ’288 to the PTO when he received the Bishoff-Riehman letter, we need not be concerned with the question of intent, because the district court’s finding of materiality was clearly erroneous. Both Balamuth ’674, which was cited by the examiner, and Balamuth ’288 disclose ultrasonic tools having internal fluid passages through which liquid flows onto the exteri- or of the tools working tip. While the precise structural arrangements of the devices disclosed by these references differ, they have the same relative degree of materiality with respect to the claimed invention. Given the cumulative nature of Balamuth ’288 compared to Balamuth ’674, Bruf ,o^Chmaí?’S t0 diS'l0S®. Bai!' muth ’288 to the PTO, despite the Bishoff-Richman letter, does not reach the thresh-oM leve of materiality under PTO Rule 1.56(a), let alone the but for standard required by the Ninth Circuit for
Walker Process
claims.
See J.P. Stevens & Co. v Lex Tex Ltd.,
Due to its similarity to Washington Revised Code § 19.86.020, Section 5 of the Federal Trade Commission Act may alternatively be considered.
See Tradewell Stores, Inc. v. T.B. & M., Inc.
We recognize that Section 5 of the Federal Trade Commission Act has been held applicable to actions that do not violate the Sherman and Clayton Acts.
F.T.C. v. Sperry & Hutchinson Co.
jn view of the lack of materiality, the district court erred in holding that there was inequitable conduct, and, therefore, its conclusion that Litton is liable for unfair competition under Washington Revised Code § 19.86.020 must be reversed. 20
SUMMARY
The district court’s decision that the ’280 patent is inva]id and that SoM State is entitled to attorney feeg and cogtg ig vacaP ed and that t of the cage ig remanded for further proceedings consistent with this inion- Itg decigion that Litton violated Washington Revised Code § 19.86.020 is Jf
Each Party wil1 bear its own costs-
REVERSED IN PART AND VACATED AND REMANDED IN PART,
Notes
. Litton Industrial Products, Inc. v. Solid State Systems Corp., No. C79-812V (W.D.Wash. June 18, 1983); Litton Industrial Products, Inc. v. Solid State Systems Corp., No. C79-812V (W.D. Wash. March 12, 1980).
. Issued February 13, 1968, on application No. 536,729 ("*729 application”), filed March 23, 1966, for a "Dental Tool,” which was invented by Charles M. Friedman and Bruce Richman and initially assigned to C & B, Inc. ("C & B”).
. Litton Industrial Products, Inc. v. Solid State Systems Corp., No. C79-812V (W.D.Wash. Nov. 22, 1983).
. See note 2 supra.
. Filed March 10, 1966, and issued April 2, 1968, as U.S. Patent No. 3,375,583, for an "Ultrasonic Dental Tool.”
. Issued January 29, 1963, on application No. 477,530, filed on December 24, 1954, for a “Dental Instrument."
. Issued February 24, 1959, on application No. 433,310, filed May 28, 1954, for a “High Frequency Dental Tool.”
. Issued May 21, 1957, on application No. 417,-407, filed on March 19, 1954, for a “Vibratory Machine Tool.”
. Litton Medical Products, Inc. v. Sybron Corp., No. Civ-74-99 (W.D.N.Y., filed Feb. 28, 1974).
. Litton Medical Products, Inc. v. Johnson & Johnson, Inc., No. 74-1406-CIV-CA. (S.D.Fla., filed Oct. 31, 1974).
. The Ewen and Sorrin articles teach an ultrasonic scaler comprising a hypodermic needle soldered to a magnetostricter base, wherein water flows through the hypodermic needle.
. Washington Revised Code § 19.86:020 provides:
Unfair Competition, practices, declared unlawful. Unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful.
. Hereinafter the term "inequitable conduct" will be used instead of "fraud."
See J.P. Stevens & Co. v. Lex Tex Ltd.,
. For example, evidence from expert witnesses for Solid State might establish that the differ-enees between the claimed invention and the references were known to those skilled in the art. Such additional evidence could affect the conclusion of nonobviousness.
. Under
Klaxon Co. v. Stentor Electric Mfg. Co.,
. There has also been no decision by the Ninth Circuit Court of Appeals which would have bound the district court.
. The Federal Circuit likewise requires examination of materiality and intent in deciding whether a patent should be held unenforceable for inequitable conduct.
E.g., Driscoll v. Cebalo,
. This level of intent for
Walker Process
actions, where inequitable conduct before the PTO is used offensively for recovering damages, apparently corresponds to the level of intent required under Federal Circuit case law for asserting inequitable conduct defensively to render a .patent unenforceable.
J.P. Stevens & Co. v. Lex Tex Ltd., 747
F.2d at 1560,
. To establish the threshold level of materiality for the defensive purpose of rendering a patent unenforceable, the Federal Circuit permits using four tests: (1) objective "but for"; (2) subjective "but for”; (3) "but it may have been”; (4) PTO Rule 1.56(a), i.e., whether there is a substantial likelihood that a reasonable examiner would have considered the omitted reference or false information important in deciding whether to allow the application to issue as a patent.
J.P. Stevens & Co. v. Lex Tex Ltd.,
. In view of Litton's nonliability, we need not consider Solid State's cross-appeal on the district court’s failure to award damages and attorney fees based on its unfair competition claim.