*1 that “in the Finally, appellants contend 240(c) case, § con- PLC, Plaintiff-Appellant, can be
present U.S.C. MOLINS au- conferring transfer strued as a statute Education,” thority Department of Coventry Smith, Jr., John thereby enabling fund section 237 at DOE to Plaintiff-Appellant, disagree. The of entitlements. We 100% necessary language support such conclu- lacking from the statute. Section sion is INC., TEXTRON, Kearney & Trecker provides that amount available “[a]n Corporation, Corporation, and Avco ap- under law be withdrawn from one Defendants-Appellees. to another propriation account and credited Nos. 94-1199 to and 94-1215. only ... law.” In view 94-1201 when authorized at language appropriations laws Appeals, United States Court prohibition issue here Federal Circuit. 1341(a)(1)(A) agency spending against § money program for a than has been more Feb. 1995. appropriated program, for that we are Rehearing Denied March accept proposition that the prepared to argue appellants funds for transfer of which
was “authorized law.”
CONCLUSION reasons, foregoing hold that
For the we Chevron, 467
Congress directly spoken,” “has 842,104 question
U.S. at S.Ct. at allocating funds for
of whether DOE erred in
§ upon entitlements based the amounts respective section
earmarked §
appropriations funding laws instead in accordance with
entitlements 100% 240(c). that, following also We hold did, “g[a]ve
approach it DOE effect to the
unambiguously expressed of Con- intent
gress.” Id. at at 2781. Ac- 104 S.Ct.
cordingly, judgment of Fed- of the Court complaint dismissing appellants’
eral Claims upon to state a relief
for failure claim granted
could
AFFIRMED.
H75 Darby Cushman, DC, Washington, & counsel. Sehuurman, Arnold,
Willem G. &White Durkee, TX, Austin, argued for defen- dants-appellees. him on the With brief was Egan. Richard D. counsel B. Of was Eric Pacocha, Meyertons. John Law S. Offices Harris, IL, Chicago, argued Dick & defendants-appellees. With him on the brief were Richard E. Dick and Howard E. Silver- *4 man.
Opinion for filed the court Circuit Judge LOURIE, in which Judge Circuit joined NIES Al as to and filed a separate A2, opinion dissenting parte as to A3, A4, B; Judge and and Circuit PAULINE joined except NEWMAN that she filed a separate opinion concurring in judgment to; part as A4. LOURIE, Judge. Circuit Smith, Coventry Molins PLC and John Jr. appeal judgment from a of the United States District Court for the District of Delaware 4,369,563 holding 4,621,410 U.S..Patents unenforceable due to fees, costs, awarding attorney expenses Smith, against jointly Molins and and sever- Textron, Inc., ally. Molins PLC v. Civ. Nos. 87-275-JjF, 86-446-JJF, and 87-163-JJF (D.Del. (amended 1994) 1, judg- Feb. final ment).1 affirm-in-part, vacate-in-part, We and remand.
BACKGROUND Kingdom Molins ais United limited liabili- Bove, Rudolph Hutz, Connolly, Lodge E. ty corporation, having principal office Hutz, DE, argued Wilmington, plain- for & Keynes, England. Milton Between 1963 and Molins, tiff-appellant, With him on the PLC. 1973, operated Molins machine tool division Jr., Connolly, brief were Arthur G. and Patri- manufacture, design, ma- for sale of Rogowki. cia Also brief was Smink machining high speed chine tools used Sacks, Pfund, E. & Charles Greenfield Bos- light alloys. Nelson, Miller, ton, Cassidy, L. MA. Scott Lewin, DC, Director, Washington, argued In Research Dr. Larroca & Molins’ Smith, Williamson, developed Coventry David for plaintiff-appellant, for John method improving machining involving plu- him on were R. batch Jr. With the brief Stan arranged Burget. rality of to accommo- and Lisa D. Also on the machine tools Mortenson West, Jr., Cushman, transport pallet-mounted was William K. date the manual brief incorporated opinion judgment amended final the memorandum December Inc., Textron, opinion reported PLC as Molins memorandum of November Textron, Inc., (D.Del. F.Supp. U.S.P.Q.2d reported as Molins PLC v. (D.Del.1992), 1993). F.Supp. U.S.P.Q.2d 1889 indicating signals from monitors machine tools ceives to and from the workpieces pallets, magazines, and bins. location of tool (the a British filed process”). Molins “batch process batch application for the patent working began for Molins Dennis Whitson applica- counterpart and filed fall of 1965 British in 1967 as one several chartered countries, including number agents working tions in a in Molins’ in-house patent managed department. He Molins’ patent States. United through department patent from 1974 fully auto- invented In Williamson responsible prosecution of all and was for the system machining that allows several mated patent applications directed to the of Molins’ parts machined si- to be families related process system 24 batch inventions. (the 24”). “system multaneously filed Hirsh, Ivan Whitson retired in When 24 in system applications for the employed by assumed the Molins since States, and in Kingdom, United United responsibilities manager of Molins’ during 1966-67. manager, other countries becoming department. After responsibility was combined process application prosecuting for U.S. batch Hirsh assumed applications relating suit system application in with- the U.S. conducting litigation involving continuation-in-part. later *5 patents. Molins’ continuation-in-part a of the from matured pat- applicatiоn.2 Before the combined U.S. primary Smith served the United States 1983, however, January in Molins, ent issued representing Molins at counsel to only cancelled and process claims were Trademark batch United States Patent and Office (“PTO”) apparatus through relevant system to the time drawn claims 1967, Beginning in period in this case.3 patent a divi- issued from issued. The patent applications prosecuted the Smith sys- application and is directed sional leading to the issuance of the ’563 and ’410 machining. 24 method of tem 1980, patents. January In Molins as- system com- patent a The ’563 discloses appli- signed patent a one-half in the interest numerically-controlled plementary, machine exchange cations to Smith in for Smith’s machined, or “work- Materials tools. agreement further undertake subjected machining pieces,” are to selected 1988, expense. July In at his own tools in operations on selected machine a reassigned patents his to Mo- interest by delivery common order selected to one-half lins. Smith remained entitled workpieces. royalty pallets loaded with the all income received Molins from form patents prior under the into the ma- licenses entered Transporters pallets deliver between 1, July 1988. rack, tools, storage a and work stations chine automatically workpieces de- are where the 1968, April fall Between the of 1967 and in bins from a bin store livered applications patent the rеlevant while Ü.S. magazines are pallets. Tool loaded on pending, patent department, Molins’ and the machine Whitson, delivered between rack specifically aware became computer by transporter. ‘Wagenseil A controls prior tools art referred here as the 4 Upon evaluating Wagenseil re- machining operations, and reference.” transport and 25, Watson, patent January law firm issued 1983. It 3. Smith was member of the 2.The'563 Cole, Watson, firm, applica- following series of Grindle and but left the tak- matured from 1970, 29, 85,289, him, ing including No. filed October Molins tions: Serial several matters continuation-in-part applications subsequently of Serial No. which is the Williamson is- 695,817, 4, 1967, which is a patents. filed December as the '563 and '410 sued 578,318, continuation-in-part of Serial No. filed "Wagenseil "Wagenseil,” 636,993, By we 4. reference” or September 1966 and Serial No. filed articles, one or more written refer to of several May patent Novem- The issued on '410 al., Wagenseil published by William et between and is Serial No. a division of ber 1962, which, case, purposes 85,289. of this 1958 and Throughout prosecution of the ser- subject the same relevant matter. applications ultimately disclose The issued ies manufacturing suit, sys- disclose an foreign priority was articles automatic in as the parts using tem used to make a number of the United under 35 U.S.C. 119 from claimed Kingdom patent applications delivery system of a under the direction central filed years control. 1965-1967. reexаmination, reference, fully During Whitson concluded that Molins referred process” anticipated the “batch claims the examiner the Rule 501 state- art Kingdom initially filed in previously Molins the United filed in ment the ’563 file. many including other countries that, indicated examiner order Accordingly, United in 1968 record, States. make the art of Molins was foreign pat- abandoned all Whitson required English language to submit transla- applications process. ent to the batch How- foreign language tions of the Ac- references. ever, decided Whitson not to abandon cordingly, filed Molins and a translations pending it contained because brief statement the relevance of cited process system both batch 24 claims. art. The examiner initialed each reference listed, indicating Molins had that he had system Prosecution U.S. and considered it. examiner’s final office applications Wagenseil continued. action in reexamination stated that he offices, foreign patent cited to and several had all of the considered cited references. not cited Molins to PTO. In rejected No claims were based on told Smith that there were Whitson during the reexamination. Re-Examination oppositions system patent to the German 4,369,563 May B1 Certificate was issued on application, but he did not Smith of inform 13, 1986. Germany, which included the Eventually, reference. Late Molins and suit Smith filed foreign system all applications. abandoned Textron, against Incorporated, Kearney & States, In issued the United the ’563 Treeker, Corporation (collectively Avco January prevailed after Molins “Textron”),5 alleging infringement of the ’563 an interference with two parties. patents.' February and ’410 after years approximately discovery, three Tex- Later in Hirsh the files of reviewed *6 summary system judgment 24 tron filed foreign applications, all of motion as- serting patents been which had abandoned the late 1970s. that the were unenforceable inequitable due to conduct with Hirsh found references that had been in connection foreign patent prosecution, patent, particu- cited in of the ’563 PTO, lar, including Wagenseil of in- refer- concealment and other correspon- also found formation from the PTO. The ence. Hirsh Whitson’s motion was relating discovery, dence to the to their denied. After more of references and June n 1990, again summary foreign patent citation to and offices. Textron moved for adding foreign judgment, allegations inequita- new Hirsh then informed Smith of the Together, they relating ble citations. consulted with out- conduct Smith’s failure and, 21, 1984, allegedly infor- September side disclose to the PTO material counsel already issued, although regarding copending patent applica- had mation Lemelson, lengthy prior filed a art under tion in whom statement 37 the.name Jerome (Rule 501) represented. Again, § 1.501 of Mo- Smith also court C.F.R. on behalf lins, summary listing Wagenseil together judgment. denied The court sev- reference conduct, inequitable with all other that had ered the issue references held a trial. prosecution. been cited bench 1984, Treeker, 24,1992, In In- October Cross & On the court November held corporated, parent corporation patents ineq- defen- both unenforceable due to Kearney Corporation, supra dant & Treeker filed a See The uitable conduct. note -1. request “exceptional” reexamination of case to with- for the ’563 court found the meaning several or- view of IBM references. Cross & 35 U.S.C. 285 and listing Wag- attorney briefing Treeker filed a Form PTO-1449 dered further whether enseil, 30, which initialed the examiner as fees should be awarded. On December 1993, having jointly considered in of 1985. held Molins been June the court and Smith Milacron, Incorpo- companies sued 5. Molins also Cincinnati missed from the case. The German companies. several rated and West German Cin- voluntarily appeal dismissed their here. cinnati Milacron settled after trial and was dis- 1178 information withholding all the severally defendants’ liable materiality and fees, thresholds of both costs, expenses. Id. An must meet
attorney
Int’l,
issued,
Organ Co. v. Kimball
intent. Allen
judgment was
defer-
final
amended
1769,
Inc.,
1556, 1567, USPQ2d
until
F.2d
5
fees
after the
839
ring the calculation
(Fed.Cir.)
pre
(“[M]ateriality does not
1778
present
and Smith’s
of Molins’
disposition
intent,
separate
is a
and essen
sume
judgment.
appeals from that
conduct.”),
inequitable
cert.
component
tial
denied,
850,
132, 102
488 U.S.
109 S.Ct.
DISCUSSION
(1988).
findings
L.Ed.2d 104
Once threshold
еstablished,
materiality
intent
are
Conduct
Inequitable
A.
weigh
court must
them to determine whether
re
Applicants6 for
are
equities
inequi
warrant
conclusion
applications
Stevens,
prosecute patent
quired to
747
table conduct occurred.
J.P.
faith,
honesty.
candor,
good
1559-60,
PTO with
223
F.2d at
Mfg.
circumstances,
Co. v. Auto
equitable judg
Precision Instrument
See
of all
Co.,
U.S.
Mach.
concerning
motive Maintenance
ment must be made
whether
806, 818,
resentative ineq ultimate determination constitutes A of this breach uitable to the trial committed conduct. judge’s and is discretion reviewed an abuse of discretion standard. under Inequitable Consultants, conduct includes affir Kingsdown Ltd. Medical fact, misrepresentation Hollister, Inc., 867, 876, USPQ2d of material mative information, denied, (Fed.Cir.1988), material failure to disclose cert. information, cou material submission false 109 S.Ct. 104 L.Ed.2d (1989). determination, pled an intent to deceive. See J.P. such To overturn *7 Tex, Ltd., ruling F.2d is appellant Lex 747 must that the Stevens & Co. v. establish (Fed.Cir. 1553, 1559, USPQ clearly findings 1092 fact or 223 based erroneous on 822, 106 denied, 1984), misinterpretation or misapplication S.Ct. on cert. 474 (1985).7 law, ineq applicable or clear error оf alleges who evidences a L.Ed.2d 60 One 88 judgment part of the district court. arising from failure to dis uitable conduct materiality Findings clear Id. and intent prior art offer and convinc close must art, subject clearly materiality standard prior of the to the erroneous ing proof 52(a) applicant of that Federal Rule of Civil Procedure knowledge chargeable materiality, appeal will this appli and the not be unless prior art and disturbed n art, that a -prior cou court has a definite and firm conviction failure to cant’s disclose 872,. Id. at 9 to mislead PTO. mistake has been committed. pled with an intent USPQ2d FMC, 1415, USPQ2d at 1115. at 1389. 835 F.2d at rules, proper PTO as to 7. The conduct in the 6. Under PTO disclose informa- standard patentability applicable to rests on the inven- tion material tor, in J.P. as summarized Stevens agent prepares attorney 1973-74, who or on each or early Corp. v. see Manville Sales prosecutes application every 551-52, Inc., Sys., 917 F.2d Paramount substantively individual who preparation involved in is (Fed.Cir.1990), in USPQ2d application or period significant portion the time cludes a inventor, who is associated with the with the patent leading during applications to which the assignee, anyone to there is an whom patent pending. '563 obligation assign application. to See 37 convenience, (1983). we C.F.R. 1.56 For sim- opinion. ply "applicant” to refer
H79 Jerabek, Wagenseil 886, 890, 1. Whitson’s Nondisclosure re 789 F.2d USPQ (Fed.Cir.1986).8 During Original Prosecution If the alleg information edly pertinent withheld is hot as as that Calling exceptional this case “the examiner, considered merely or is cases,” among case the district exceptional cumulative to that considered the examin Whitson, concluded Molins’ in- er, such information is not material. See. patent agent, engaged inequita house had Scripps Clinic & Research Found procurement ble conduct of the ’563 Genentech, Inc., 1565, 1582, 927 F.2d USPQ2d Wagen because he to failed disclose (Fed.Cir.1991). 1014-15 PTO, though seil to the even he knew was highly material. The court stated that “[al We have held that' the result of a though has], produced [Textron direct proceeding PTO patentability that assesses deceive, evidence of Whitson’s intent to i.e. of information not originally disclosed ‘smoking implicating there are no memos’ strong probative can be of value determin Whitson, bad faith on the the over ing whether the undisclosed information was whelming presented circumstantial evidence Stevens, material. See J.P. 747 F.2d at in this case leaves little doubt that Whitson (reasonable rejection intentionally Wagenseil concealed the refer claims in during reliance on a reference reis knowing ence from the U.S. PTO that it was proceeding sue materiality established highly applications.” material to the U.S. reference). However, the standard to Although Wagenseil Molins concedes that applied in determining whether a refer highly material to the batch process inven- ence is particu “material” is not whether the tion, Molins asserts that the court erred in' lar application examiner of the at issue con was material to sidered the reference important; to be rath claims, only the ’563 which relate er, it is that of a “reasonable examiner.” system 24 points invention. Molins out Tech., Inc., Western Electric Co. v. Piezo that, although Wagenseil was cited to and (Fed. during considered the examiner reexami- Cir.1988). Nor ais reference immaterial nation of the ’563 examina- simply because eventually the claims are patent, tion of the divisional by' deemed an examiner patentable to be upon by was not reject relied examiner thereover. Danbury Merck & Co. v. Phar Molins, pending According Wag- claims. macol, Inc., 1418, 1421, 10USPQ2d ipso enseil was not material. facto (Fed.Cir.1989) (“That the claimed
Information is
“material”
may
when
invention
superior
have been
...
to both
there is a substantial likelihood that a rea
cited and withheld
art
be a
sonable examiner would
patentability;
have considered the
basis for
it cannot serve auto
important
deciding
information
matically
whether
render the withheld
allow the
patent.
immaterial.”);
issue as a
either cumulative or
A.B. Dick
*8
information,
duty
8. The
to disclose
prima
information material
to
unpatentabilily
a
facie case of
patentability
claim;
(2)
refutes,
has been codified in 37 C.F.R.
of a
or
It
or is inconsistent
(Rule 56),
§
promulgated pursu-
1.56
with,
whiсh was
(i)
position
applicant
Oppos-
a
takes in:
§§
ant to 35 U.S.C.
6 and 131. From 1977 to
ing
argument
unpatentability
an
Office,
relied on
1992,
56
Rule
defined information as "material”
(ii) Asserting
argument
pat-
or
when "there is a substantial likelihood that a
entability.
important
reasonable examiner would consider it
(1992).
§
37 C.F.R. 1.56
"[A]dministrative rules
deciding
application
in
whether to allow the
to
will not be construed to have retroactive effect
patent.”
adopted
issue
aas
We have
this stan-
language requires
unless their
this result.” Bow-
materiality.
dard as the threshold standard of
204, 208,
Georgetown
Hosp.,
en v.
Univ.
488 U.S.
LaBounty Mfg.,
See
Inc. v. United States Int’l
468, 471,
(1988);
Comm'n,
109 S.Ct.
H81
surrounding
light
ap
facts
circumstances
of all
the evidence’ and must
deter-
then
Lab.,
plicant’s
Paragon Podiatry
conduct.
mine
totality
whether
that
conduct
its
Inc.,
Lab.,
1182,
Inc. v. KLM
984 F.2d
1189-
sufficiently culpable
manifests a
state of
5
1561,
(Fed.Cir.1993).
90,
USPQ2d
1567
2
mind to warrant a determination
that was
inequitable.”
Corp.
Consolidated Aluminum
inferences, particu
drawing
“The
Int’l, Ltd.,
809,
v.
804,
Foseco
910 F.2d
15
larly
respect
ques
intent-implicating
of an
1481,
(Fed.Cir.1990).
USPQ2d
1484
peculiarly
province
tion ...
is
within the
the fact finder that
observed
witnesses.”
Thus,
alleged
conduct must
Corp.,
Rolls-Royce Ltd. v.
Valeron
800
GTE
merely
improper perfor
amount
(Fed.Cir.
1101, 1110,
185,
USPQ
F.2d
of,
of,
mance
ought
or omission
an act one
1986).
personally
the fact-finder
Since
has
Rather,
performed.
have
clear and convinc
testimony
heard
observed the de
ing
prove
must
applicant
evidence
that an
witnesses,
meanor of the
we accord defer
specific
accomplish
had the
intent
an
act
ence to the
of a
fact-finder’s assessment
wit
applicant ought
per
to have
.not
credibility
ness’s
character.
See General
formed, viz.,
deceiving
or
misleading
Corp.
Corp.,
Electro Music
v. Samick Music
involving
PTO.
case
nondisclosure
1405, 1411,
1149,
USPQ2d
19 F.3d
information, clear
convincing
evidence
(Fed.Cir.1994). However, “[g]iven the ease
must
applicant
show that the
made a deliber
with
a relatively
routine act of
ate decision to withhold a known material
prosecution
portrayed
can be
as intended to
reference.
deceive,
convincing
mislead or
clear
evi
support
dence of conduct sufficient to
finding
The court based its
intent
culpable
required.”
intent
inference
Whitson,
following
pat-
evidence.
a seasoned
Telecom,
Datapoint Corp.,
Northern
Inc. v.
practitioner,
ent
who
was aware of the
931, 939,
USPQ2d
908 F.2d
1327 to
PTO,
disclose material information to the
denied,
(Fed.Cir.),
cert.
highly
knew of a
material reference
did
(1990).
296, 112
S.Ct.
L.Ed.2d 250
See also
it,
any
reference,
cite
Tol-O-Matic,
Inc.
Proma
Produkt-Und
during
years
PTO
the entire 13
in which he
m.b.H.,
Marketing
Gesellschaft
in prosecuting
was involved
the U.S.
(Fed.Cir.
20 USPQ2d
applications
patent.
that led to
Dur-
1991) (“Forfeiture
enforceability]
[of
is not
ing
applications
pending,
the time the
remedy
favored
aas
for actions not shown to
represented
foreign patent
Whitson
offices
culpable.”).
be
was
art.
the closest
Whitsоn
several occasions
reminded
While intent to deceive the PTO
Wagenseil’s
materiality through
promi-
found as matter
from cir
inference
evidence,
nence in
cumstantial
several
circumstantial evidence
merely
counterpart applications
gross negligence.
cannot
indicate
with which Whitson
intimately
Kingsdown,
rejected
863 F.2d at
involved. The court
(“[A] finding
particular
argument
Molins’
that Whitson had acted in
‘gross negligence’
good
simply
Wagenseil,
amounts to
does not of
faith and
overlooked
deceive;
justify
itself
an inference of intent to
since he or his associates had
focused on
conduct,
during
involved
viewed in
of all
reference several times
more than ten
evidence,
including
years
foreign prosecution
évidenee
indicative of
never
good faith,
must
culpability
years
indicate sufficient
prosecution.
deceive.”).11
require
circumstances,
a finding
intent
say
Under these
we cannot
“[C]ourts must
‘in
improperly
view
involved conduct
that the court
inferred that Whit-
intent,
Kingsdown
negligence
prove
11. This court's in
decision
banc
was sufficient to
where-
conflicting precedent regarding
simple negligence, oversight,
resolved
whether
or an erroneous
insufficient)
finding
gross negligence compels
judgment
good
made in
faith was
Co.,
Compare
Corp.
of intent to deceive.
J.P.
&
Stevens Co.
FMC
v. Manitowoc
Tex,Ltd.,
*10
v. Lex
747 F.2d
223
n.
5
n. 9
(Fed.Cir.1984),
denied,
(Fed.Cir.1987) (gross negligence
cert.
474 U.S.
alone did not
(1985)
mislead).
(gross
finding
106 S.Ct.
H83
intentionally
patent
of the ’563
Hirsh and Smith
Upon issuance
Janu-
withheld it
1983,
Hirsh
a
of the
ary
undertook
review
from the PTO because this manner of disclo
prosecution
corresponding
files from the
for-
sure
was tantamount
a failure to disclose.
cases,
eign
all of which Molins had aban-
Boats,
Citing Penn Yan
Inc. v. Sea Lark
by
Hirsh reviewed the
doned
1976. When
Boats, Inc.,
948,
F.Supp.
USPQ
175
German, Dutch,
Japanese prosecution
and
(S.D.Fla.1972),
aff'd, 479 F.2d
files,
prior
he became aware of a number of
(5th Cir.),
denied,
USPQ 577
cert.
414 U.S.
references, including Wagenseil,
ait
that had
(1973),
94 S.Ct.
letter to PTO issue, tice, liability to which stated: “Before the as matter about and not a of strict tion filed, pre- a applicant made application was the the whatever the nature of action before search, and liminary patentability Telecom, at-939, discovered PTO.” Northern ” 359 following pertinent references.... the USPQ2d at 1327. 964,175 USPQ Following at 271. F.Supp. at Hirsh and Smith discovered a multitude statement, a of thir- appeared there list uncited references in related files inequi- held that references. teen They after ’563 issued. disclosed the thir- had occurred because table conduct relatively the references within a short time listed, patent, not in a was teenth reference subsequently under Rule 501 and cited preexamina- of a as result fact discovered pat- in the references reexamination ’410 search, than one had issued more tion prosecution. Putting for now ent aside Whit- year filing appli- the patent after the date of impropriety citing prior in not art son’s 963-66, at Id. at at cation issue. earlier, Hirsh did make an at- and Smith purpose 271-72. The court found that tempt repair The examiner to the situation. “bury misrepresentation [thir- was to reference, indicating his initialed each consid- allegedly a long list of reference] teenth same, eration of the and stated that he had hope patents in the prior old art prior considered all of the cited art. Absent Examiner, already having allowed the Patent contrary, proof to the we assume that issue], ignore would the list and [claims Id., examiner did consider references. 965,175 permit [patent] to Id. at issue.” (“It 908 F.2d at at 1327 is Thus, Yan, USPQ at in Penn the refer- 272. public presumed that their as- officials do way in such ence was characterized signed jobs.”).14 These circumstances there- Here, the PTO. the reference was mislead present convincing fore do not clear and mischaracterized, but was submitted evidence of intent on the of Hirsh or along with a multitude of references. conceal Smith to PTO prior the time of the Rule 501 art At Thus, during the reexamination. .the court’s submission, practice, but not it was desirable erroneous, clearly regard in this is out the ex- required, particularly point determination that method prior of cited material aminer relevance disclosure constituted inequitable conduct (4th ed., § Compare art. MPEP 2002.03 rev. cannot be sustained. (failure 1980) Apr. to comment on the art or failure prior relevance.of submitted 3. Whitson’s and Smith’s Nondisclosure identify passage especially an relevant buried the Lemelson Patents may otherwise less or nonrelevant text an During prosecution of the claims comply failure with the constitute ultimately patent, in the issued ’563 disclosure) (1992) § with C.F.R. 1.98 principal cited the examiner references (no necessary for explanation of relevance against patents claims certain included English language). More- information issued in the name of Jerome Lemelson. over, particularly refer- “burying” a material patents These automatic stor described containing in a ence statement (U.S. system 3,049,247) age Patent and an proba- multiplicity of other references can be (U.S. production apparatus automatic Patent MPEP Item 13 tive of bad faith. Cf. 3,313,014 (4th 1981) (“Don’t 26,770). and its ’014 ed., Reissue rev. Jan. submit in an the examiner office long lists of art if it can avoided. Subsequently, action in 1969. marginally the examiner clearly Eliminate irrelevant patents. cited the ’770 The court pertinent prior art, long If list cumulative submitted, highlight engaged determined that and Smith those references Whitson they significance.”). which most How- knew of be of because comport proper procedure. Presumably, could the examiner have refused PTO to consider the references if their submission did
H85 ’247, ’014, patents, and ’770 ble conduct because the the Lemelson court found that material, they did not claim 11 of the Lemelson highly patentability material to the claim 160 of disclose those the PTO. *13 (cid:127) application, the ’563 it and because the сourt that the court erred Smith assert when inferred an intent to engaged deceive the PTO from concluded that Whitson Smith the fact of Smith’s representation dual inequitable failing in in to cite the Molins and Lemelson. Smith asserts that patents patents because Lemelson the were finding the court erred in that information actually by the PTO and considered regarding the application Lemelson would during prosecution, patent the ’563 were used have been material to the examiner of reject claims, pending to and were overcome the patent ’563 and that Smith intended to patent. to of the ’563 issuance disclosing deceive the examiner not such was “When reference before the examin- information. er, through whether the examiner’s search position in which placed Smith himself disclosure, applicant’s the it cannot be fraught possible was with one conflict of in- deemed to withheld ex-: have been from the terest representation because Smith’s dual Scripps, aminer.” 927 F.2d at seeking patents closely two in clients related 1015; Orthopedic Equipment at Co. technologies sacrificing created a risk of the Inc., Appliances, Orthopedic All interest of one client for that of other and (Fed.Cir. USPQ. failing discharge duty to his of candor to 1983) (nondisclosure not material because respect the PTO with to each cíient. Wheth- independently examiner the exis- ascertained interest, er or there not was a conflict of art). tence of the The Le- undisclosed however, us, express before and we no patents melson were indeed of record opinion express Nor any thereon. do we patent application. agree ’563 We with opinion regarding apparent conflict be- finding Molins and that Smith court’s attorney’s obligations tween an to the PTO that the Lemelson were withheld was attorney’s obligation and the to clients. Thus, clearly erroneous. the failure of Hirsh to Smith to cite these references However, regarding obligation Smith’s inequitable PTO did not constitute conduct. PTO, us, agree which is before we that Textron
Smith failed to establish 4. Smith’s Nondisclosure the Lemel- convincing inequita- clear and evidence that Application son ble conduct occurred in the nondisclosure of claim 11 application. Lemelson Le- During the time that the ’563 melson claim not material was being prose prosecuted, was Smith was also patentability of the claims ’563 because was cuting application, num machine tool serial already to art cumulative record made 107,357, ber that named Lemelson inven as patent. prosecution of A the ’563 trial, argued tor. At Textron that Lemelson reference that is cumulative to refer- claim 11 and Williamson' claim 160 defined ences of does not record meet threshold invention, patentable the same materiality prove inequitable needed to Smith his violated candоr Scripps, See conduct. disclosing application the Lemelson to the USPQ2d at 1015. Claim 11 no was more responsible examiner for the William pertinent to Williamson claim 160 than was 2001.06(b) application. son See MPEP claim patent, 26 of Lemelson ’770 (4th 1981) ed., (duty rev. Oct. disclose already was of record in ’563 bring material “duty information includes prosecution. finding Thus the court’s to the attention ... examiner informa claim 11 material Lemelson was [applicant’s] tion within knowledge to oth clearly erroneous and the court’s determina- co-pending er applications United States inequitable tion of conduct based on that which are ‘material examination’ an abuse of discretion. application question.”). found that Smith’s copending failure disclose the Textron also asserts that took incon- inequita- positions of Lemelson constituted sistent before the PTO system Although 24 invention after prosecution of the representation. his dual
course of contemplating litigation, begun Molins had in itself not assert does Textron any potential con- conduct, precluding defendant from Textron amounted discovery. ducting and fair The court full examiner “[t]he Williamson states that Smith acted in bad faith know also found very interested to been would have discovery testifying incon- obstructing had, prosecuting the Lemelson that Smith sistently. grand- that the applications, [1954 admitted very combi- parent] application disclosed the records that Molins stаtes that argued thrice [in had nation which Smith pat destroyed were abandoned *14 suggest- applications] was neither Williamson files, any and that citations of references ent and by application, [that] ed disclosed nor correspondence and relevant with the argued was had ‘abandoned’
which Smith patent offices were sent to counsel However, in did not fact Smith Lemelson.” concerning fail United States for advice the prosecuting the make admission. that PTO. ure to cite these references the only he asserted that application, Williamson Companies are maintain file de entitled to nor patents of record the Lemelson neither being found to programs without struction combination suggested the grandparent their How improperly destroyed have evidence. warehousing system and an anof automatic ever, judge in the district court the best During apparatus. production automatic position parties’ litigation conduct to monitor on prosecution applications, the Lemelson any and can best determine whether destruc hand, urged patentability the the other part legitimate of an tion established production line in recited of claim which program. In disposal records See Beckman device controlled which a master control AB, struments, Inc. v. LKB Produkter tools, and ar- and machine transfer devices (Fed. 1301, 1305 1547, 1552, 13USPQ2d F.2d grandparent provid- gued that the Lemelson Cir.1989). Furthermоre, the district court is These for such a claim. are support ed injured by pre at “the most misconduct the assertions. different stages.” Rolls-Royce, trial trial F.2d at at 192. The court Exceptional B. Case here, making judged parties’ the conduct that Molins and Smith assert the findings adverse Molins and Smith. Nei finding this to district court erred us of ther Molins nor Smith has convinced warranting at exceptional case an award of findings regarding clear error in the court’s re However, under U.S.C. 285. We torney litigation fees their conduct. because findings underlying view court’s factual finding the partly the court also based its that clearly standard and its under the erroneous exceptional “pattern the the case was on de Reac underlying legal novo. conclusions repeated inequitable on instances ESM, Inc., Corp. v. Alloys Smith, Whitson, Hirsh,” tive & Metals part the (Fed.Cir. 1578, 1583, 226USPQ litigation F.2d con addition to Hirsh’s Smith’s 1985). underpin legal duct, If these factual and' we for the court to reconsider remand scrutiny, nings' we review the withstand finding exceptional its that the case is i.e., fees, attorney whether attorney award of fees award of of our conclu rea appropriate and the amount specific award was regarding types of conduct sions Id., sonable, of discretion. for abuse involved. 1582-83, USPQ at On take into ac- Such reconsideration should hand, underpinnings partially if the count fact that have affirmed the we reversed, for further evalua we remand holding inequitable conduct Whitson’s tion trial court. Wagenseil during original failure to cite finding patent, reversed partially based its holding of un- that Hirsh’s and Smith’s method exceptional evidence case in- citing post-issuance constituted fair of Molins. references litigation conduct conduct, holding Specifically, equitable Hirsh selec- reversed the court found tively destroyed pertaining to and Smith’s nondisclosure the Whitson’s records H87 inequitable Subsequent carry heavy constituted counsel Lemelson burden conduct, holding culpable known reversed Smith’s overcome acts of coun- , of the Lemelson sel. The district court nondisclosure found that further conduct, inequitable affirmed concealment of actions ran constituted Whitson’s afoul of findings regarding litigation court’s and Smith’s of candor. Hirsh’s We are Thus, liberty and Smith. not at to overturn misconduct Hirsh the district court’s holding jointly severally credibility that counsel that Smith is lack and acted having clearly bad faith. Under liable cannot be based Smith’s erroneous applicable and abuse of engaged conduct before the discretion standards here, findings district PTO. court’s and conclu- regarding inequitable sions conduct and the Although explicitly we have not discussed exceptional nature of this case must be sus- arguments parties, each of the raised tained. carefully have considered each of them. we disposition changes None of the several Inequitable I. Conduct issues detailed herein. *15 and Hirsh’s Smith’s Failure To Disclose
CONCLUSION Wagenseil The References judgment holding The of the district court The court found that in the manner which 4,369,563 4,621,410 Patents and unen- Hirsh and Smith Wagenseil disclosed the inequitable due to is af- forceable conduct during references reexamination of the ’563 (cid:127) attorney that basis Molins’ firmed patent failing was tantamount to to disclose intentionally withheld Whitson a material all, them at and that and Hirsh Smith there- of reference from the The at- PTO. award by intentionally deceived the PTO.1 The ma- torney fees, costs, expenses and is vacated however, jority, the court clearly concludes remanded for and reconsideration on the ba- finding in erred that and Smith Hirsh intend- of the sis various conclusions we have ed to support deceive the PTO. of Hirsh reached. Smith, majority and the notes:
Hirsh and Smith a discovered multitude of COSTS uneited references in related files patent They after the ’563 issued. dis- party Each will bear its own costs. relatively closed the references within AFFIRMED-IN-PART, VACATED-IN- subsequent- short under and time Rule 501 PART, and REMANDED. ly cited the references reexamina- patent prosecution. tion ’410 Putting and NIES, Judge, Circuit dissenting-in-part. impropriety aside for now in Whitson’s earlier, judgment citing prior would the I affirm the of art and the district Hirsh attempt repair in did make an entirety. appellants The are Smith the guilty pattern during The of misconduct the situation. examiner initialed each ref- erence, indicating patent, his consideration of the the subse- same, quent patent, of that and stated that he had considered all reexamination and the art_ below, prior litigation during These circum- which documents the destroyed. present therefore do not clear These acts are interrelated stances convincing part and cannot in be evidence of intent on the this case isolated from each Wagenseil Hirsh Smith to conceal other. during PTO the the reexamination. majority The affirms Whitson, True, by respectfully disagree. but creates a Chinese be- I Hirsh Wall (Whitson’s Whitson, replace- prior purportedly tween list Hirsh Smith did file art ment), Smith, 1.501, § filing Molins’ local C.F.R. that counsel. under 37 can- Duty by applicants 1. The owed of Candor C.F.R. 1.555. PTO reexamination is set forth in 37 files, comments, ing Hirsh saw Whitson’s realistically as a “disclo- characterized be beliefs, actions, knowledge regarding MPEP, According such sure.” by Wagenseil.” in an Examiner art not considered list is but, already-issued patent of an the case requested, and PTO & Trecker Cross patent’s placed file. simply is rather^ granted, the reexamination on basis 1983)2 (5th ed., Aug. § 2202 See MPEP publications. six Molins then filed a IBM (“Prior patents printed or the form art response It is page to those references. Patent publications may cited to the notes, true, majority that Hirsh and as placement pat- into the Office Trademark for subsequently Smith did cite the listed art purpose citing basic ent .files act, the reexamination. candor inform the files is to however, severely man- diminished public general owner and ner noted the dis- disclosure —as publications printed such trict citation was made court. The - and should be considered when existence response 783-page Office massive claims.”) validity evaluating literally put The Examiner was Action. added.) is no indication (Emphasis There haystack. finding a in a Further- needle list Examiner reviewed the more, description refer- Sep- it in time submitted Hirsh response in their provided ences list, filing if 1984. The tember of (i.e., comprising tape-controlled “Transfer supports district court’s anything, tools”), cryptic, and Molins machine were aware of the and Smith Hirsh patentability identify any failed claims materiality of references. might by Wagenseil be affected *16 references. list, art prior I note that Molins’ as also submitted, comply did not with the After the Examiner contacted Molins re-
originally explanation, garding inadequacy § the requirements of the statuto- of its 35 U.S.C- authorizing Supplemental of with a Re- ry provision inclusion the list Molins answered sponse they in part the official file.3 Molins’ which reiterated the same patent’s of given any description Wagenseil of original expla- cryptic did not include be- submission art, any Regarding Wag- the of of the cited let alone the fore. the nation of - claims, requisite explanation pertinency the to the Molins’ re- of both enseil references merely particular sponse may be and the cited art to stated: “This consid- application of length, applicable plurality at of pages The and ered least the сlaims. list was numerically art. tools pieces prior over of Aside controlled machine recited identified (Em- as, example, 1.” Wagenseil the claims claim entry of refer- the the bald added.) list, phasis knowledge Molins’ of page on 4 of the Hirsh Smith Given ences materiality Wagenseil undisputed Wagenseil the of the nothing bring did atten- references, “may” of example, tion For Molins could the use the word of the PTO. (out only list reference to one claim of the requested reexamination when the the have not, however, request pending) 294 then render this statement both was filed. Molins did reexamination, disingenuous unsatisfactory. Equally di- explan- the no and there were accompanying singenuous following the statement atory the list. The statements prefaced Wagen- Supplemental Response undisputed fact that Molins knew the is art, description including than of the cited seil was more relevant the art —if the prior Wagenseil: references, the taken not most art.on the list. “None the relevant of combination, individually pertinent or in “[a]s court noted that a result review- bearing any promulgat- on patentability 2. the MPEP was to have The Fifth Edition of patent. August particular of a person ed in The first revisions to that claim 1983. If until writing pertinency edition did occur October explains and manner applying prior art to at least one claim such recites, pertinent part: 3. Section 301 prior patent, the citation such art of the "Any persоn any explanation time Office will become cite thereof writing prior consisting patents 35 U.S.C. patent." file of official (1988) [Emphasis printed publications person added.] which that believes
H89 any of applied nor can it be the claimed art. IBM The summaries both Examiner which define the combinations inventive sub- that only Interviews reveal the IBM articles added.) ject (Emphasis as a matter whole.” during were discussed the Examiner not, faith, simply in good could make simply interviews. There is no indication- statement, given ef- devastating such a that Hirsh anything Smith did and/or already fect the references had meaningful Wag- ensure consideration of the prosecution on wrought Molins’ worldwide enseil references reexamination. efforts.4 To Molins’ Failure Disclose The Lemelson Although majority states that “[t]he Application Patents and reference, indicating examiner initialed each The district court found Whitson same, his consideration of the and stated that Smith patents withheld several Lemelson art,” he had considered all the cited during prosecution from the PTO of the ’563 provides an insufficient basis for rever- patent application. The district court found reexamination, completion sal. Upon that Whitson and knew of patents, Smith all of references were listed highly knew material Indeed, the reexamination certificate. Mo- pending application, did not disclose request lins for a filed Certificate of Cor- them with an intent to deсeive the PTO. art, rection to ensure the cited includ- also found that the ’357 Lemelson references, ing appeared patent application “highly material” to the face the reexamination certificate. application, ’563patent Moreover, entry page # 19 on 4 of list and that Smith’s nondisclosure of the ’357 (Wagenseil’s Tape-Con- “America’s First application resulted from an intent to deceive publication) trolled Production Line” has the PTO. The court concluded that Whitson therethrough, indicating line drawn that the had, by actions, and Smith their committed reference was not considered the Examin- majority disagrees conduct. The Furthermore, er. there are no Examiner because the Examiner independently found indicating initials his consideration of that patents. and considered the reference. Inasmuch as Hirsh and Smith provided separate description never of that To absolve Whitson for their *17 reference, Wagenseil surprising.5 this is not failure to patents, disclose the Lemelson Having supply failed to us with the Certifi- majority Scripps relies on Clinic & Research Correction, cate of do Found, we not know what art Genentech, Inc., 1565, v. 927 F.2d must be deemed considered. 1582, 1001, USPQ2d (Fed.Cir.1991), 18 1015 proposition for the that a Despite knowledge “[w]hen of reference signifi- Molins’ examiner, through was before Wagenseil, whether cance of the reexamination file applicant’s or history, spanned examiner’s sеarch dis- pages almost 1800 closure, it Appendix, clearly cannot be deemed to been indicates that the focus have only of withheld from the communications between the the examiner.” Not PTO and art, dicta,6 Wagenseil. overly Molins was the IBM not For the statement relied broad example, rejections all of the claim contained conflicts with an decision earlier of this solely both Actions are Office based court.7 Thus, 4. The differences in U.S. and law does ence was cumulative. the court's discus- materiality Wagenseil not affect of the disclo- sion on or not whether the reference was with- -i.e., sures. the court's discussion of how the man- held— ner in which a reference comes before an Exam- inequitable analysis by iner affects an art list submitted Hirsh and conduct —was necessaty Wagenseil publications, two resolution the issue and identified listed as ' is, therefore, entry entry dicta. # 16 and # 19 under “Other Docu- However, provided ments.” both time Molins art, description they provided only of the cited Scripps, 7.Prior to our decision in court entry description publication. inequitable of the #16 found conduct on a based failure eventually independently disclose art that statement, making by 6. Prior to Scripps that discovered made record. Examiner and 1392, inequi- Burroughs Corp., court addressed and resolved the issue of A.B. Dick Co. v. 798 F.2d (Fed.Cir.1986) by concluding (concluding table conduct the withheld refer- 230 849 non- 1190 however, opportunity, such Molins’ apрlication, At each Respecting Lemelson (cid:127) operated just opposite, al- of clients with con- to do representation actions
Smith’s justification guaranteeing no that the refer- flicting provides interests most required obviously him to Ethics in a far deceiving the PTO. ences would be lost sea amply supports the simply The record art. withdraw. relevant Molins was less finding pattern posses- court’s forthcoming district with information its concerted, ongo- appellants reflects by that sion. prior art from withhold material ing effort to findings materiality The district court’s to deceive. with an intent the PTO subject clearly errone and intent are agree with the district help I cannot but 52(a) Federal ous standard Rule undisputed of the evidence. & Rules of Procedure. J.P. Stevens Co. Civil by appellants, carefully of actions series Ltd., v. 223 Lex Tex 747 F.2d the district court fully articulated (Fed.Cir.1984), USPQ 1089, cert. de pres totalling pages, opinions almost two nied, 106 S.Ct. 88 L.Ed.2d convincing evidence of intent ents clear (1985). clearly The district court did not Whitson, Hirsh and to deceive found, err when it of all of the Smith, “smoking in the absence even Whitson, Hirsh, circumstances, Dynamics Corp. Inc. v. gun”. Braun See with intent to deceive the Smith acted PTO!
America,
USPQ2d
F.2d
materiality
of the
undisputed
(Fed.Cir.1992) (intent
element
references, when balanced
and Lemelson
convincing
evi
proved
be
clear
must
with the cumulative nature of their actions
Lab.,
dence).
Podiatry
Paragon
See also
deceive, compelled
evidencing an intent
Inc.,
.,
1189-
v. ELM Lab
Inc.
equitable
the district court’s
determinations
(Fed.Cir.1993)
Whitson', Hirsh, and Smith violated
then-
required
is not
(“[S]moldng gun evidence
inequitable
duties of candor and committed
an intent
deceive....
order to establish
concluding,
conduct.
the court did not
so
conduct,
Rather,
this element
law,
discretion,
misapply
and this
abuse
generally
inferred from the facts
must
court should therefore affirm.
surrounding
appli
circumstances
conduct.”); LaBounty Mfg.,
cant’s overall
Exceptional
II.
Case
Comm’n,
Int’l Trade
Inc.
United States
1066, 1076, USPQ2d
I would also affirm the court’s
(“Direct
(Fed.Cir.1992)
wrongful
proof of
in
exceptional
this case is
and the court’s dis
rarely
be inferred
tent is
available
costs, fees,
cretionary award of
interest and
convincing
evidence
clear
findings
expenses. The
made
the court
*18
circumstances.”).
surrounding
erroneous,
Gear,
clearly
not
L.A.
Inc.
v.
Co.,
1117, 1128,
McAn Shoe
F.2d
Thom
988
Hirsh and Smith character-
The actions of
(Fed.Cir.) (whether
1913,
USPQ2d
1921
a
25
by
majority
“attempt
the
an
re-
ized
determination,
exceptional
ease is
is
factual
filing
of the
list
the
pair” —the
denied,
error),
and is reviewed for clear
cert.
subsequent
list in
reexam-
citation of that
the
—
-,
291,
all,
114
were,
U.S.
S.Ct.
126
attempt at
if an
feeble
ination —
(1993),
L.Ed.2d 240
and there was no abuse
unacceptable given their
knowl-
attempt,
Corp.
Shatterproof
of discretion.
v.
high materiality
of
Glass
edge of the
Co.,
613, 629,
Libbey-Owens Ford
758 F.2d
presented
Molins was
with am-
references.
634,
(Fed.Cir.)
ensure,
USPQ
(awarding
or at least in- 225
644
at
plе opportunities to
likelihood,
torney’s
of
ref-
fees is within the discretion
crease the
that
dismissed,
976, 106
court), cert.
474
given the attention due
trial
erences would be
(1985).
during the
S.Ct.
H91 majority unnecessarily The orders re evidence and bad unfairness faith partly also based its part mand “because court that convinces the Court finding exceptional case exceptional that this is an ease. ‘pattern repeated inequitable instances of majority’s unnecessary is remand be- Smith, Whitson, part conduct on the unfairness, faith, inequita- ” cause the bad removing Hirsh.’ Even from consideration by ble conduct cited as the basis for inequitable the instances of reversed conduct finding exceptional this case was majority, clear there remains majority’s remain despite the reversals on convincing excep evidence that this ease inequitable some instances of conduct.- The v. tional. Advance Co. Levin Transformеr unfairness was based on Hirsh’s destruction son, 1081, 1085, USPQ2d 1600, 837 F.2d 5 documents, which the district court noted (“An (Fed.Cir.1988) exceptional 1603 case “was litigation the sort bad faith miscon- convincing must established clear and attorneys duct that would warrant an .fee evidence.”). Indeed, noted, judge as the finding award.” The court’s of bad faith was among is the exceptional “this case case ex based on Hirsh’s destruction of documents ceptional eases.” coupled inequitable conduct on the justifying Exceptional circumstances majority’s Molins. The reversal does not precedent, our award of fees noted in such as inequitable exonerate Molins. Molins’ con- Bayer Aktiengesellschaft Duphar v. Int’l Re duct included Whitson’s dis- B.V., 1237, 1242, USPQ search 738 222 F.2d closing Wagenseil, majority which the af- (Fed.Cir.1984), unfairness, 652 include Thus, firmed. there remains a basis faith, conduct, bad vexatious or finding. court’s bad faith The court’s unjustified litigation, and misconduct exceptional clearly this case was is not exhaustive, litigation. This list is erroneous. any existence one circumstance make Portec, exceptional. Read v. Corp. case necessary regarding Nor is a remand Inc., USPQ2d 1426, 970 F.2d award of did fees. The court not abuse its (Fed.Cir.1992) (“[Ljitigation misconduct making discretion in award. The court may in itself ‘exceptional.’”); make a case appropriate chose three factors —closeness of Inc., Coherent, Spectra-Physics v. Inc. case, counsel, tactics the conduct (Fed. 1524, 1537, USPQ2d 1737, F.2d plaintiff of the list of factors delin —from Cir.) (bad during litigation may faith conduct precedent. eated in Corp. our See Delta-X 285), exceptional make a case under cert. Tools, Inc., Hughes v. Baker Prod. denied, 484 U.S. 108 S.Ct. 98 410, (Fed.Cir.1993); J.P. (1987). Regarding excep L.Ed.2d 372 Ltd., v. Stevens Co. Lex Tex 822 F.2d case, tional nature the district court (Fed.Cir.1987); USPQ2d 1235, stated: Son, Carter-Wallace, S.C. & Johnson Inc. persuaded Court this is an Inc., exceptional sys- case. Hirsh and Smith (Fed.Cir.1986). listed, Of the three factors tematically all reviewed of Molins’ files is clear that the court was most influenced relating System faith, stating Molins’ bad “[i]n *19 24 invention. Hirsh selected out some rec- faith, scope significance and of Plaintiffs bad ords, eventually destroyed and remain- the the Court will and exercise discretion destroyed der. The files were after Molins attorneys award Defendants reasonable began litigation. contemplating At a mini- fees....” mum, Hirsh’s of files destruction the is In particular, the district court made nu- of evidence “unfairness”. The destruction findings regarding any merous Smith’s conduct precluded potential defendant from “persuasive which attor- conducting discovery. full fair were on the issue of and When neys which not light actions fees but considered as Hirsh’s are considered in of respect- of relevant the other evidence to the Court’s conclusions” Molins, ing inequitable light of part conduct. this destruction statement, majority’s the files faith. It is constitutes bad this it seems clear further action must be regarding inequi to cases in which revеrsals, Smith’s ed at least little, in by the district court which conduct, any, bearing if taken have will table way open to it to attorneys appellate court has no judge’s to award decision Furthermore, district court’s action this court affirm reverse the fees on remand. “judgments of district court under review. has stated that easily good faith are concerning and bad Corp. v. Foseco Aluminum Consolidated at 827 F.2d Spectral-Physics, overturned.” Ltd., USPQ2d 910 F.2d Int'l 1746, citing Marine USPQ2d at Western (Fed.Cir.1990). Here, no further ecs, Co., Elec. v. Furuno El required by the district aetion should be (Fed.Cir.1985). court. identify in on to court went The district majority to If the wishes reheve Smith destruction of documents particular Hirsh’s individually, liability it could so hold identify produce to failure Smith’s without a remand. faith. instances bad documents as further instances of incon- The also noted court three NEWMAN, Judge, Circuit PAULINE testimony in Smith’s sistencies concurring joining judgment, litigation. Additionally, the district court’s opinion to A4. except part court’s as replete case are with refer- opinions join judgment I concur in the court’s credibility and lack of over- ences to Smith’s except part A4. In opinion the court’s veracity. specifically The court stated all following join I view of concerns do testimony throughout litiga- that Smith’s reasoning A4 as attor- the court’s was, best, at tion, particularly at trial obligation ney to disclose to the PTO Smith’s than truthful.” “less the confidential information of unrelated documents, which Hirsh’s destruction client. discovery, outright precluded full and fаir majority appears assume identify produce failure to Smith’s required information Smith was to disclose documents, certainly obstructed dis concerning application to pending Lemelsoris covery, kinds of ac themselves PTO, subject fact that this attorneys warranting an award fees tions already matter cumulative to justice and the fair alloca the interests and that did not before examiner litigation. Brook tion of the burdens See positions really take asserted the inconsistent Devices, Inc., Corp. tree v. Advanced Micro had Textron. I do not see that Smith USPQ2d Indeed, obligation to obligation. such an his (“The (Fed.Cir.1992) statutory purpose [an confidentiality preserve of his client Le- attorney reach where award is to cases fee] had neither au- melson absolute. Smith justice the interest of warrants fee-shift obligation thority nor to breach the confiden- Gear, ing.”); F.2d at L.A. application, on tiality pending of that chent’s (trial judge weighs factors behalf of a different client. a fair contribute to allocation of totality litigation burdens 2001.06(b) of the Manual Patent Section circumstances). The litigation district court Examining applicant, requires an Procedure prevent the defendants to awarded fees to attorney, bring his or her injustice, majority’s gross and the remand is of the examiner “as to attention information unjustified abundant evidence applications copending United States —there findings support district patentability’ which are ‘material to regarding of Molins and Smith the actions authority question.” individually remain untouched 2001.06(b), & in M.P.E.P. Co. Armour *20 majority’s As we have stated: reversals. Co., 779, 175 USPQ & Swift (7th remand, Cir.1972), copending expendi- applica accompanying involved A with corporation. by the How judicial in a tions owned same
ture of additional resources 2001.06(b) ever, § not confi thought completed, step is a not does reach case to be entirely application that an that should be limit- dential lightly taken one However, happened to regulations unrelated client entrust to the taken. I stress that lawyer. attorney’s An same ethical obli- the M.P.E.P. can not attorney’s override an gations client not a obligation preserve to each are erased when to the confidences of the possible although conflict That I occurs PTO.1 client. Thus share the conclusion client’s, privilege lawyer’s. not that there was no breach of Smith’s to PTO, interpreted can I PTO rules to reach that conclusion not because require otherwise. of the substantive differences between the matter, subject Lemelson I appear accept am concerned lest we because Smith and Molins could not have possibility required that Mr. Smith was charged improper been behavior and pending applica- disclose client Lemelson’s thereof, consequences simply because PTO, tion to the on behalf of client Molins. respected Lemеlson’s confidences. Indeed, contrary such behavior is to the PTO professional code responsibility. 4: Canon practitioner
“A preserve should the confi-
dences and secrets of a client.” 37 C.F.R.
§ 10.56. disciplinary implement- rules
ing require Canon 4 INDUSTRIES, INC., HILL SUN practitioner knowingly: shall not Plaintiff/Cross-Appellant, (1) or of a Reveal confidence secret
client. (2) aUse confidence or secret of a client UNLIMITED, EASTER INC. Fun d/b/a disadvantage of the client. World, Defendant-Appellant, (3) Use a confidence or secret of a client advantage practitioner for the or of the person, third unless the client consents Fay’s Incorporated Syndicated full after disclosure. Co., Sales Inc. Defendants. 10.57(b). 37 C.F.R. The American Bar 94-1235, Nos. 94-1256. Association Model Rules of Professional Con- impose duty: duct a similar United Appeals, States Court of Confidentiality Federal Circuit. of Information (a) lawyer A shall not reveal information Feb. 1995. relating representation of a client Denied; Rehearing Suggestion for unless the client consents after consulta- Rehearing In Banc Declined tion, except impli- disclosures April 1995. edly carry authorized in order out the representation, except as stated (b).2
paragraph (1983).
A.B.A. 1.6 Rule application ap-
The facts as to Lemelson’s
pear to have been before the trial court.
Considering appeal this basis us,
which it reaches I share this con- court’s subject
clusion that this matter was cumula-
tive to the references of record positions
inconsistent 1. committing likely Whether Smith had a conflict interest and if act client criminal so how he handled it is not an issue in case. bodily result imminent death or substantial charge There is no warrant for the serious ethical harm, or to a claim defense establish and conviction levelled the dissent. lawyer arising in an behalf action out of representation. It has no here. (b) Paragraph provides for unconsented revela- necessary prevent tion of information