Lack of Intentional Concealment Derails Best Mode Defense in Patent Challenge

By Tony Dutra

There was no proof that a patent holder intentionally concealed the best mode of implementing its claimed apparatus, the U.S. Court of Appeals for the Federal Circuit ruled May 21 in a 2-1 decision (Ateliers de la Haute-Garonne v. Broetje Automation USA Inc., Fed. Cir., No. 2012-1038, 5/21/13).

The majority, reversing a lower court’s invalidity judgment, held that a 1962 decision by the Court of Customs and Patent Appeals–the predecessor to the Federal Circuit–requiring intentionality was still good law. The dissent contended that subsequent decisions by the CCPA rejected the requirement.

The America Invents Act eliminated the best mode defense in litigation for any action filed on or after the AIA enactment date, Sept. 16, 2011, so the court’s opinion has a short life in any case.

How Many Grooves Is Best?

Ateliers de la Haute-Garonne filed a patent infringement lawsuit against Brötje Automation GmbH in the U.S. District Court for the District of Delaware.

AHG asserted two patents (U.S. Patent Nos. 5,011,339 and 5,143,21) directed to a rivet-dispensing device used in aircraft assembly. The rivets are dispensed through a pressurized tube with grooves along its inner surface. The question at issue in this case was whether the inventor disclosed the best mode in terms of the number of grooves.

The patent specification cites three grooves as a preferred embodiment. At the time of the invention, the inventors believed that only an odd number of grooves works properly, but that was not disclosed. Ultimately, they determined that five grooves was optimal, and they introduced a product for sale with five grooves.

Judge Leonard P. Stark granted summary judgment of invalidity for failure to disclose the best mode, and AHG appealed.

Majority Says 1962 Precedent Still Good Law

Judge Pauline Newman said that a violation of the best mode requirement, 35 U.S.C. §112, ¶1, “requires intentional concealment; innocent or inadvertent failure of disclosure does not of itself invalidate the patent.” She traced that requirement to In re Gay, 309 F.2d 769, 772, 135 U.S.P.Q. 311 (C.C.P.A. 1962).

Though the inventors had experimented with five grooves, the majority said that, at the time the patent application was filed, they believed the three-groove solution was the preferred embodiment.

Further, the court said, “The general statement that an odd number is better than an even number is not a statement of a better mode than the preferred embodiment shown in the specification.”

Quoting the inventors’ statements in the record liberally, the court determined that AHG did not intentionally conceal a better mode than the three-groove embodiment, and reversed the judgment of invalidity accordingly.

After rejecting a separate argument that AHG had abandoned the application by paying a maintenance fee late, the court remanded for further proceedings.

Dissent Disputes Which Precedent Applies

Judge Sharon Prost said that the intentionality requirement was overridden by the CCPA in In re Sherwood, 613 F.2d 809, 204 U.S.P.Q. 537 (C.C.P.A. 1980), which held that concealment can be “accidental or intentional.”

The majority had argued that Gay, decided earlier than Sherwood, should take precedence when there is a conflict, but Prost said that the opposite was true of CCPA decisions, since that court was always sitting en banc.

The majority and dissent disagreed on Federal Circuit holdings as well, with Prost claiming the majority relied on dicta in Brooktree Corp. v. Advanced Micro Devices Inc., 977 F.2d 1555, 24 U.S.P.Q.2d 1401 (Fed. Cir. 1992). She cited four subsequent cases in saying that “this court has repeatedly acknowledged the error in the Brooktree dicta and recognized that we are bound to follow our earlier precedent that intent is not an element of a best mode violation.”

In the instant case, Prost claimed that, even if the three-groove embodiment was described in the specification, the inventors did not distinguish it as the best mode and in fact, “buried it amongst many embodiments that they knew did not work.”

She relied on Randomex Inc. v. Scopus Corp., 849 F.2d 585, 7 U.S.P.Q.2d 1050 (Fed. Cir. 1988), for the proposition that “a disclosure can be ‘so poor as to effectively result in concealment.’ ”

Though that was not the result in Randomex, it was the case here, she said, because “one of ordinary skill in the art would have to build and test three other systems … to tell which was the best mode.”

Scott G. Lindvall of Kaye Scholer, New York, represented AHG. Patrick J. Kelleher of Drinker Biddle & Reath, Chicago, represented Brötje.

Text is available at http://www.bloomberglaw.com/public/document/Ateliers_De_La_HauteGaronne_v_Broetje_Automation_USA_Inc_Docket_N.