Trojan, Inc. v. Shat-R-Shield, Inc.
885 F.2d 854
Fed. Cir.
1989
Check Treatment

*1 Conclusion Corporation holding the judgment under Code excise taxes

liable for shall recover Corporation

is reversed. provided paid taxes with interest

law. cross-appeal, the government’s

On granting refund of the interest

judgment interest thereon affirmed.

paid with

Costs Corporation.

Costs PART, IN IN REVERSED

AFFIRMED

PART.

TROJAN, INC., Plaintiff-Appellee,

v.

SHAT-R-SHIELD, INC.,

Defendant-Appellant. Fitch, Even, Jones, Tabin & Robert B. Ill., Chicago, argued, plain- Flannery,

No. 89-1027. brief, him on the tiff-appellee. With Appeals, David A. Crossman. Court of United States Federal Circuit. Evans, Rhodes, Jr., Osborne & R. Gale Bank, N.J., Kreizman, Charles Red L. Sept. 1989. Elser, Moskowitz, Thomason, Wilson, Edel- Newark, N.J., Dicker, argued, for &man defendant-appellant. NEWMAN, NIES,

Before MICHEL, Judges. Circuit NIES, Judge.. Circuit Shat-R-Shield, (SRS) moved for ad- Inc. against Trojan, injunctive relief ditional (1982), Inc., invoking 28 U.S.C. § preclude Trojan specifically Tro- under which contracts have lamps which been jan would infringe United States Patent held to Inc. (’189). See 4,506,189 No. Shat-R-Shield, Inc., F.Supp. *2 855 USPQ2d (E.D.Ky.1988).1 ry judgments 1391 The district equitable and such and ex- court denied SRS’s motion. Inc. v. traordinary relief as it deems proper, in- Shat-R-Shield, Inc., 85-143, ‍​​​‌‌‌​‌​‌‌‌‌‌​‌‌​‌‌‌​‌‌‌​​​​‌​​‌‌‌​​‌​​​‌‌‌​‌​​‍slip op. No. cluding but not limited injunctive to re- 2, 1988) (E.D.Ky. Seрt. (Suhrheinrich, J.). exercising lief. jurisdiction, the affirm. We give regard court shall to due the inter-

ests of national defense and national se- I curity. entirety The analy- of the district court’s argues 1491(a)(3) SRS refusing enjoin sis to permits a grant district court to “comрlete on contracts is as follows: relief,” including injunctive against relief injunctive motion for relief under infringer’s bidding an activity, when the 1491(a)(3) 28 hereby be and is U.S.C. § product at issue is not crucial to the nation however, denied; the Court finds that sought al defеnse relief and is before a Shat-R-Shield is entitled to the relief contract is disagree. awarded. We anAs requested, but the Court is constrained matter, initial section 1491 is limited by its deny to Shat-R-Shield’s motion for an terms to the United States Claims Court. injunction against Trojan’s bidding in That is appropriate limitation because a the in view of decision W.L. Gore & already district court comparable had au Associates, Garlock, Inc., Inc. v. 842 thority before that section was enacted. (Fеd.Cir.1988). F.2d 1275 See, e.g., Corp. Wheelabrator Chafee, Slip op. at 2. F.Supp. (D.D.C.1970), 319 87 rev’d on mer urges that the district court correct its, (D.C.Cir.1971); 455 F.2d 1306 A.G. ly 1491(a)(3) found that 28 U.S.C. entitled § Resor, Co. v. F.Supp. Schoonmaker 319 requested SRS to the relief in but erred (D.D.C.1970), 933 rev’d & remanded on holding that the decision of this court merits, (D.C.Cir.1971). 445 726 F.2d More Associates, Garlock, W.L. Gore & Inc. v. over, neither type court can exercise the of

Inc., (Fed. USPQ2d 842 F.2d 6 1277 injunctive power by authorized Cir.1988), precluded such relief. dis We 1491(a)(3)in patent infringement ‍​​​‌‌‌​‌​‌‌‌‌‌​‌‌​‌‌‌​‌‌‌​​​​‌​​‌‌‌​​‌​​​‌‌‌​‌​​‍litigation. agree points on both raised SRS. Whether in the Claims Court or a district сourt, equitable power the grant to in an

II junction 1491(a)(3) as referenced in section 1491(a)(3) A. applicable only Section Is is Inapplicable the context of a suit on against a contract claim the United States. 1491(a) prоvides, Section in pertinent part: phrase any “on contract claim” in against 1491. Claims the United § “establishes and limits generally; States ... types of juris cases within court’s (a)(1) The United power may States Claims Court diction which the [remedial] jurisdiction judg- shаll have to render be exercised.” United States v. John C. upon any against ment claim the United (Fed. Grimberg upon any express States founded or Cir.1983). ... 1491(a)(3)gives Subsection implied contract with the United power grant particular court the a rеme States.... relief, dy, only such equitable as when the nature, i.e., particular

claim in suit is a claim,” distinguished “contract as from the (3) complete any afford To relief types against govern brought other of claims contract claim bеfore the con- 1491(a)(1). awarded, tract the court have ment listed subsection shall jurisdiction grant exclusive n. declarato- 1366 & 6. improvidently granted refusing modify

1. We the order An order an vacate Appeal immediately appealable which under 28 U.S.C. § March consolidated (1982) Appeals ordinarily separate pri- No. with receives and 89-1027 No. 88-1528 and 88- (taken merits). judgment ority from the on the treatment. 85 (1982) pre- that 28 U.S.C. contract held Moreover, limits the section agree We injunctive relief.2 contrаct “brought before the cludes one

claim to court ambiguous language of the district That that conclusion is awarded.” mo- it is understood that SRS's meaningful consequent becomes has contract aon that a bidder to be denied. tion hаd government, with the contract implied an Garlock, that it court held *3 fairly government the will assuring that to modify injunction an al- unnecessary to the its bid “before honestly consider and participate on and infringer “to an bid ‍​​​‌‌‌​‌​‌‌‌‌‌​‌‌​‌‌‌​‌‌‌​​​​‌​​‌‌‌​​‌​​​‌‌‌​‌​​‍low id. is awarded.” See contract [express] government the sale to [in- in the Indus., 11; Inc. United n. Keco 1368-69 1282, 6 Id. at fringing] products." (1970). 773, 428 F.2d 1233 States, 192 Ct.Cl. potential supplier A or USPQ2d at 1283. implied asserting of an breach is not infringing product the of an supplier for fairly con- SRS bid to have an сontract injunctive from is “immune” government Trojan, not against claim is SRS’s sidered. sale, manufacture, or barring relief government. the 1281-82, 6 product. Id. at supply such a to in seeks is an relief SRS Similarly, the 1498 “is Because section at 1284. USPQ2d govern against Trojаn, not the junction always sub- injunctive relief is paramount,” history for section legislative The ment. patent owner’s a ject the condition that to however, Congress clear, that 1491 makes infringer is deal- “only recourse” an the jurisdiction on intеnded to confer is to “sue the ing government the relief injunctive award Claims Court to in the United States Claims States United preaward government in the against the compensation.” Id. at its Court for entire process. Such procurement stage of the 1498(a) 1283, USPQ2d Section at 1284. “arbitrary prevent authority to was meant patent if a holder be emasculated would contracting capricious by the or action of infringing enjoin bidding could to firms deny qualified would which ficials explained As Gаrlock: products. we compete for the fairly to opportunity the patent from the patentee takes his S.Rep. No. 97th procurement award.” govern- subject States United added), (1981)(emphasis Cong., 1st Sess. rights to obtain eminent ment’s dоmain Cong. Ad & reprinted in 1982 U.S.Code manufacturers and to it needs from what 11, 33; C. Grim min.News see also John gra- has government use the same. 1372. The district 702 F.2d at berg statute, consented, in same to ciously the was entitled to that SRS court’s statement reason- Court fоr the Claims be sued under requested” the “relief for compensation, entire what and able error, 1491(a)(3) legal but harmless infringement by private if a be would ruling. view of its ultimate apply principles to person. The same sum, equitable power type of In the nothing more are than injunctions which 1491(a)(3) appli- no by has granted to aid of the courts the giving the of the litigation. infringement cability patent to right patentee’s of the enforcement Though injunctions may seem exclude. 1498(a) Precludes B. Section selling to making and the say that for Injunction an forbidden, [sic, in- government are] held it could The district court that patent rights cannot junctions based govern bidding on enjoin Trojan from not 1498(a). reality that because do deci view of court’s ment contracts in may not short, patent owner use a Garlock, sion in off patent to cut the USPQ2d unequivocally which against by remedy action be 1498(a) owner’s shall provides: the 2. Section United States Claims States in United in and invention described Whenever an recovery of his reasonable and for the Court by patent States is of the United covered use and compensation manu- United or used or manufactured entire thereof or of the owner without liсense States facture. same, right use or manufacture lawful supply, stage 1491(a)(3), sources of either at the bid or argues mentions section during performance of a con- holding that we should refine the in that tract. case, regards which it overly broad. Although unequivocally we find SRS’s ar- SRS seeks to avoid or restrict the above gument merit, reject without Trojan’s we ground on the that Garlock did not view that appeal is frivolous. injunctive mention authority of section 1491(a)(3),so that a issue” is “new raised. Ill SRS, Per that issue complex, involves the statutory interplay between section sum, 1491(a)(3) hold we that section 1491(a)(3), urges and section that sec- inapplicable patent to a infringement suit. tion should held be to restrict the аgree Because we with the district court 1498(a). scope Although of section 1498(a)precludes an specifically court did not address section against infringer’s an bidding to supply the *4 1491(a)(3) Garlock, it did address the infringing devices, we af- 1498(a) interрlay between and in- firm. Finally, Trojan’s request for attor- junctive relief in connection with on ney fees is denied. prevail- as the contract, specifically holding ing party, shall receive its costs. infringer that an could not enjoined be AFFIRMED. thеrein, bidding. As stated paramount “1498 is making when the is for NEWMAN, Judge, concurring. Circuit selling or the is to the United States join panel I opinion as to sections A Government and the is necessar- and C of Part I II. concur in the result ily subject to says that condition whether it B, reached in section separately but write or not.” so view of our panel because I majority’s believe state- inapplicable is to an respect 1498(a) ments with to 28 U.S.C. § infringement private suit parties, between broad, unduly are as unnecessary well as argument SRS’s that the Garlock decision to the result. rejected. should be modified is 1498(a) 28 U.S.C. is an eminent domain Appeal C. States, SRS’s Is Not Frivolous Corp. law. Leesona v. United 220 234, 958, (1979). 599 Ct.Cl. F.2d 966 Its Characterizing appeal as aрplication possible wherein, to all cases “frivolous,” Trojan requests an of award patents may infringed by be or on behalf of attorney opposing fees and costs in government, grounded whether or not appeal part of sanctions under Fed.R. “public meaning use” within the of the App.P. Although recog 38.3 this court has amendment, fifth has not been tested in the nized that definition of what consti “[t]he Further, aspect courts. is not at issue. difficult,” appeal tutes a frivolous civil is challenge No governmental to “essential Sears, Co., v. Connell Roebuck & exigency public necessity”, or in the 1542, 1554, 193, USPQ (Fed.Cir. 220 203 in Cramp Court’s words & Sons v. Curtis 1983), under present circumstances 28, 41, 271, 246 Turbine ‍​​​‌‌‌​‌​‌‌‌‌‌​‌‌​‌‌‌​‌‌‌​​​​‌​​‌‌‌​​‌​​​‌‌‌​‌​​‍U.S. 38 S.Ct. appeal here we do not find SRS’s frivolous. 274, (1917), 62 L.Ed. 560 raised Shat- Trojan contends that SRS “does not even R-Shield. pretend distinguish this case from Gore disagree. specifi original legislative premise v. Garlock.”4 We was to cally notes appeal, remedy patentees. Garlock its briefs on assurе a Act of June 25, 1910, 423, (amended correctly opinion contends that the never ch. 36 Stat. 851 provides: ap- 3. Rule 38 sanctions under Rule 38 a frivolous peal appeals was filed. If a court of shall determine that an frivolous, appеal may just damages it award Indeed, distinguish precedent any 4. failure to single appellee. or double costs to the meaningful way grounds Service, for sanctions. has been Asberry v. United States Postal 692 See, 1378, 1382, 921, e.g., Toepfer Departmеnt Transp., (Fed.Cir. USPQ v. F.2d 215 921 of F.A.A., 1102, (Fed.Cir.1986). 1982), impose F.2d 1102 this court warned that it would 792 1288, Cong., 1918); 2d H.R.Rep. No. 61st FAHRZEUGWERK Sess., (1910); supra, at Cramp, GOLDHOFER at CO., & not GmbH Congress did 274. S.Ct. Plaintiff-Appellant, possible additional cost discuss the flow, example, government, as would purchase of the government’s

from the STATES, The UNITED paying “reason- lamps from while Defendant-Appellee. compensation” to Shat-R- able and entire No. 89-1298. legislative his- is clear from the Shield. It not enacted tory Appeals, that Section Court United States cheаper procurement. See to enable Federal Circuit. the 1918 sponsor of the that

statement Sept. 1989. urgent” as “necessary and amendment was Rehearing 1989. Denied Oct. “expedite the manufacture of war it would Rehearing In Banc Suggestion Leesona, F.2d at 967 materials.” 1, 1989. Dec. Declined (remarks (1918) Cong.Rec. 7961 (quoting 56 Further, in 1910 Rep. Padgett)). even the effect Congress was concerned about tak- innovation of such

on inventors and Thus, presented for

ings. until the issue is imply,

adjudication inappropriate it is *5 dictum, is of

even that Section scope.

unlimited simply question panel before ‍​​​‌‌‌​‌​‌‌‌‌‌​‌‌​‌‌‌​‌‌‌​​​​‌​​‌‌‌​​‌​​​‌‌‌​‌​​‍amendment, in the 1918 enacted

answered insulating express purpose of from

for the infringing

suit those who

goods government, by providing that to the compensation shall come from the

“entire” Act of

government. Appropriations Naval

July 40 Stat. 705. This ch. in, upheld

legislative purpose e.g., has been Anchor Co. v. United

Richmond Screw

States, 331, 345, 48 S.Ct. 275 U.S.

197-98, (1928); 72 L.Ed. 303 Gore & W.L.

Associates, Garlock, Inc., 842 F.2d Inc. v. (Fed.Cir.

1275, 1282, USPQ2d

1988). 1498(a)in accord Applying Section terms, I would affirm the

ance with enjoin refusal

district court’s lamps offering infringing

Department of Defense. Geraghty,

James A. Donohue & Dono- hue, City, argued plaintiff- York New appellant. Sochaczewsky,

Mark S. Commercial Liti- Branch, Justice, gation Dept, of New York City, argued defendant-appellee. With Schiffer, him on the brief were Stuart E.