Outside the Box Innovations, LLC v. Travel Caddy, Inc.

United States Court of Appeals
for the Federal Circuit
__________________________

OUTSIDE THE BOX INNOVATIONS, LLC (doing
business as Union Rich USA),
Plaintiff-Appellee,

AND

BONAKA LIMITED BONAKA, PLASTIC
MANUFACTURING CO., LTD.,
AND UNION RICH PLASTIC FACTORY, LTD.,
Counterclaim Defendants-Appellees,

AND

CHRISTOPHER URE, MATT WILLIAMS, TERRY
KINSKEY AND LYNN MARTINEAU,
Counterclaim Defendants,

v.
TRAVEL CADDY, INC.
Defendant/Counterclaimant-
Appellant,

AND

ROOSTER PRODUCTS (doing business as The Rooster
Group),
Defendant/Counterclaimant.
__________________________

2009-1171
__________________________
OUTSIDE THE BOX v. TRAVEL CADDY 2

Appeal from the United States District Court for the
Northern District of Georgia in Case No. 1:05-CV-2482,
Senior Judge Orinda D. Evans.
___________________________

Decided: September 21, 2012
___________________________

PATRICK D. MCPHERSON, Duane Morris LLP, of Wash-
ington, DC, argued for plaintiff-appellee and counterclaim
defendants-appellees. On the brief were ROBERT L. BYER
and MATTHEW C. MOUSLEY, of Philadelphia, Pennsylvania,
and J. RODMAN STEELE, JR. and GREGORY M. LEFKOWITZ, of
Boca Raton, Florida. Of counsel were WILLIAM BLAKE
COBLENTZ, of Washington, DC, and BARRY P. GOLOB, of San
Francisco, California; GREGORY L. HILLYER, Feldman Gale,
P.A., of Philadelphia, Pennsylvania; and JEROLD I.
SCHNEIDER, Novak Druce + Quigg LLP, of West Palm
Beach, Florida.

TIMOTHY P. MALONEY, Fitch, Even, Tabin & Flannery, of
Chicago, Illinois, argued for defendant/counterclaimant-
appellant. With him on the brief was MARK W. HETZLER. Of
counsel on the brief were VANCE L. LIEBMAN, GLENN A. RICE,
ORLEY MOSKOVITS DESSER, and SETH A. STERN, Funkhouser
Vegosen Liebman & Dunn, Ltd., of Chicago, Illinois.
__________________________

Before NEWMAN, PROST, and O’MALLEY, Circuit Judges.
Opinion for the court filed PER CURIAM. Opinion concur-
ring in part and dissenting in part filed by Circuit Judge
NEWMAN.
3 OUTSIDE THE BOX v. TRAVEL CADDY

PER CURIAM.

This declaratory judgment patent suit was filed by Out-
side the Box Innovations, LLC, doing business as Union
Rich USA (herein “Union Rich”) against Travel Caddy, Inc.
and its distributor/sales agent for Travel Caddy’s patented
tool carry cases, Rooster Products (doing business as The
Rooster Group). The issues, duly presented by claim and
counterclaim, were infringement, patent validity, enforce-
ability, and unfair competition.

The United States District Court for the Northern Dis-
trict of Georgia held that Travel Caddy’s United States
Patent No. 6,823,992 (the ’992 patent) and its continuation
Patent No. 6,991,104 (the ’104 patent) are unenforceable in
their entirety, based on inequitable conduct in the United
States Patent and Trademark Office (PTO). The district
court sustained the validity of claims 5, 12, 23, and 30 of the
’104 patent, but held the other claims of the ’104 patent and
all the claims of the ’992 patent invalid on the ground of
obviousness. The court held on summary judgment that the
version of the Union Rich tool carry case called the Electri-
cians Carryalls (Electricians Bag I) infringes various patent
claims, but that a modified version called Electricians Bag
II and the tool carry case called Heavy-Duty ProTool Bag do
not infringe. The court also dismissed Union Rich’s unfair-
competition claims against Travel Caddy. 1 On Travel
Caddy’s appeal, we reverse the judgment of unenforceability
based on inequitable conduct, vacate the rulings of invalid-

1 Outside the Box Innovations, LLC v. Travel Caddy,
Inc., No. 05-cv-2482, 2007 U.S. Dist. LEXIS 102167 (N.D.
Ga. Aug. 7, 2007) (Infringement); 2008 U.S. Dist. LEXIS
123218 (N.D. Ga. Dec. 19, 2008) (Inequitable Conduct and
Validity); 2009 U.S. Dist. LEXIS 131341 (N.D. Ga. Aug. 3,
2009) (Reconsideration).
OUTSIDE THE BOX v. TRAVEL CADDY 4

ity, affirm the rulings of noninfringement, and remand for
further proceedings.

We start with the district court’s rulings of inequitable
conduct in the PTO, for these rulings voided all claims of
both patents.

I

INEQUITABLE CONDUCT

The district court held the ’992 and ’104 patents unen-
forceable on the grounds that (1) Travel Caddy did not
disclose to the PTO the existence of the litigation on the ’992
patent during prosecution of the ’104 application, and (2)
Travel Caddy paid small entity fees to the PTO but was not
entitled to small entity status.

To establish unenforceability based on inequitable con-
duct in the PTO, it must be shown that information mate-
rial to patentability was withheld from the PTO, or material
misinformation was provided to the PTO, with the intent to
deceive or mislead the patent examiner into granting the
patent. Therasense, Inc. v. Becton, Dickinson & Co., 649
F.3d 1276, 1290-92 (Fed. Cir. 2011) (en banc). Withholding
of material information and intent to deceive or mislead
must be established by clear and convincing evidence. Id. at
1287 (citing Star Scientific, Inc. v. R.J. Reynolds Tobacco
Co., 537 F.3d 1357, 1365 (Fed. Cir. 2008)).

A. Non-disclosure of the ’992 litigation in the re-
cord of the ’104 application

The district court held that Travel Caddy committed in-
equitable conduct in failing to notify the examiner of the
’104 application that the parent ’992 patent was in litiga-
5 OUTSIDE THE BOX v. TRAVEL CADDY

tion. The district court held that Travel Caddy had the
obligation to inform the ’104 examiner of the ’992 litigation,
and that this was material information, citing Manual of
Patent Examining Procedure (MPEP) §2001.06(c):

Where the subject matter for which a patent is
being sought is or has been involved in litigation,
the existence of such litigation and any other mate-
rial information arising therefrom must be brought
to the attention of the U.S. Patent and Trademark
Office. Examples of such material information in-
clude evidence of possible prior public use or sales,
questions of inventorship, prior art, allegations of
“fraud,” “inequitable conduct,” and “violation of duty
of disclosure.” Another example of such material in-
formation is any assertion that is made during liti-
gation which is contradictory to assertions made to
the examiner.

The district court held that, although only infringement of
the ’992 patent had been placed at issue, “it was clear that
the issue of validity would likely arise in the litigation.”
Inequitable Conduct and Validity op., at *39. The court
inferred deceptive intent from the fact of non-disclosure,
stating:

The Court infers from the facts in evidence that
Travel Caddy intended to deceive the PTO when it
failed to disclose the current litigation during the
pendency of the ’104 Patent. Nelson drafted the
’104 and ’992 Patents, was the prosecuting attorney
for both patents, and has been heavily involved as
counsel in the current litigation. Furthermore, Nel-
son is clearly an experienced patent attorney and
testified as to his awareness of Rule 56 and Section
2001 of the MPEP.
OUTSIDE THE BOX v. TRAVEL CADDY 6

Inequitable Conduct and Validity op., at *41.

MPEP §2001.05 states that “[i]f information is not ma-
terial, there is no duty to disclose the information to the
Office.” Travel Caddy argues that it violated no law or
regulation or rule, that there was no withholding of infor-
mation material to patentability, and no intent to deceive
the PTO. Travel Caddy points out that validity of the ’992
patent had not been included in the Union Rich complaint
nor otherwise placed at issue during the time when the ’104
application was pending, and that no prior art or other
information had been presented by Union Rich, even infor-
mally, during the brief period of overlapping pendency of the
’104 application and the ’992 litigation. The ’104 application
was filed on November 4, 2004, and this complaint was filed
by Union Rich on September 23, 2005, requesting only a
declaration of noninfringement. The ’104 patent was al-
lowed on October 31, 2005 and issued on January 31, 2006.

No information now asserted to be relevant to pat-
entability of the ’104 application had been provided in the
’992 litigation while the ’104 application was pending. No
ground of invalidity was included in the complaint against
the ’992 patent, or communicated informally despite Travel
Caddy’s inquiries. Travel Caddy’s patent attorney Nelson
testified that he did not file notice of the ’992 litigation in
the prosecution of the ’104 application because “[t]here was
nothing in there that was what I understood to be material
under Rule 56. There was nothing that related to pat-
entability, enforceability or validity.” T. Tr. 230:11-13 (Feb.
5, 2008), J.A. 5572. See Therasense, 649 F.3d at 1291 (in-
formation is material “if the PTO would not have allowed a
claim had it been aware of the undisclosed prior art”).

The district court found that, “[g]iven the number of in-
dicators that validity could arise as an issue and Nelson’s
7 OUTSIDE THE BOX v. TRAVEL CADDY

involvement in both the application for the ’104 Patent and
the current litigation, the Court finds it incredible that
Nelson believed the current litigation to be irrelevant to the
prosecution of the ’104 patent.” Inequitable Conduct and
Validity op., at *42. However, the issue was not whether
the ’992 litigation was irrelevant; the issue was whether the
existence of the ’992 litigation was material to patentability
of the ’104 application, when there was no citation of prior
art, nor any pleading of invalidity or unpatentability in the
’992 complaint as it existed during pendency of the ’104
application. Although a later challenge to the validity of the
’992 patent was surely possible, it did not then exist. We
conclude that the district court’s ruling was in error, for
there was not clear and convincing evidence of withholding
of information material to patentability of the claims in the
’104 application during the pendency of that application.

Nor was there clear and convincing evidence of intent to
deceive the examiner of the ’104 application. The district
court stated that it “made this inference [of deceptive intent]
because it found this inference to be the single most reason-
able inference based on the evidence.” Reconsideration op.,
at *13. The district court stated that its “finding that Travel
Caddy intended to deceive the PTO when it failed to disclose
the current litigation to the PTO is in keeping with the law
recited in Star Scientific.” Id. In Star Scientific the court
held that to draw an inference of deceptive intent it must be
“the single most reasonable inference able to be drawn from
the evidence to meet the clear and convincing standard.”
537 F.3d at 1366. There was no evidence on which to base
an inference of deceptive intent.

The court in Therasense sought to restore objectivity and
consistency to the law of inequitable conduct, by requiring
that “the accused infringer must prove that the patentee
acted with the specific intent to deceive the PTO.” 649 F.3d
OUTSIDE THE BOX v. TRAVEL CADDY 8

at 1290. Specific intent to deceive the PTO requires “knowl-
edge and deliberate action”:

This requirement of knowledge and deliberate
action has origins in the trio of Supreme Court cases
that set in motion the development of the inequita-
ble conduct doctrine. In each of those cases, the
patentee acted knowingly and deliberately with the
purpose of defrauding the PTO and the courts.

Id. (citing Precision Instrument Mfg. Co. v. Auto. Maint.
Mach. Co., 324 U.S. 806 (1945); Hazel-Atlas Glass Co. v.
Hartford-Empire Co., 322 U.S. 238 (1944); Keystone Driller
Co. v. Gen. Excavator Co., 290 U.S. 240 (1933)). Here, the
record contains no suggestion of how the withholding of the
information concerning the ’992 litigation could have de-
ceived the examiner and no suggestion of deliberate action
to withhold it in order to deceive the examiner. Union Rich
offered no such evidence, nor presented any support for any
inference of intent to deceive.

The district court ruled that the non-disclosure itself
was material to patentability, although there was no sug-
gestion of how Travel Caddy may have benefitted from the
non-disclosure. Even on this erroneous ruling as to materi-
ality, deceptive intent must be separately established by
clear and convincing evidence. Therasense, 649 F.3d at
1290. The district court rejected Travel Caddy’s argument
that if notification of the existence of the ’992 suit were
indeed required during prosecution of the ’104 application,
any omission was due to oversight or error or negligence,
not deceptive intent. Negligence, however, even gross
negligence, is not sufficient to establish deceptive intent.
See Kingsdown Med. Consultants, Ltd. v. Hollister Inc., 863
F.2d 867, 876 (Fed. Cir. 1988) (en banc in relevant part) (“a
finding that particular conduct amounts to ‘gross negligence’
9 OUTSIDE THE BOX v. TRAVEL CADDY

does not of itself justify an inference of intent to deceive”);
see also Lazare Kaplan Int’l, Inc. v. Photoscribe Techs., Inc.,
628 F.3d 1359, 1379 (Fed. Cir. 2010) (“mistake or exercise of
poor judgment . . . does not support an inference of intent to
deceive”); Molins PLC v. Textron, Inc., 48 F.3d 1172, 1181
(Fed. Cir. 1995) (“[T]he alleged conduct must not amount
merely to the improper performance of, or omission of, an
act one ought to have performed.”).

There was not clear and convincing evidence of specific
intent to deceive the examiner into granting the ’104 appli-
cation. The district court’s ruling of inequitable conduct
based on non-disclosure of the ’992 litigation cannot stand.
That ruling is reversed.

B. Incorrect claim of “small entity” status

The district court held that Travel Caddy had also com-
mitted inequitable conduct by claiming small entity status
and paying reduced PTO fees, and that this conduct ren-
dered both the ’992 and ’104 patents permanently unen-
forceable. The court held that small entity status was not
available to Travel Caddy, although it met the small entity
definition of having fewer than 500 employees, because of
Travel Caddy’s commercial arrangement with a large entity,
The Rooster Group. 13 C.F.R §§121.801-805 defines a small
entity as a concern whose employees, including affiliates, do
not exceed 500 persons. The Rooster Group had more than
500 employees counting its Mexican affiliate. 37 C.F.R.
§1.27 provides for small entity status in the PTO when the
entity:

Has not assigned, granted, conveyed, or licensed,
and is under no obligation under contract or law to
assign, grant, convey, or license, any rights in the
invention to any person, concern, or organization
OUTSIDE THE BOX v. TRAVEL CADDY 10

which would not qualify for small entity status as a
person, small business concern, or nonprofit organi-
zation.

37 C.F.R. §1.27(a)(2)(i).

Travel Caddy states that The Rooster Group is its dis-
tributor and seller of the patented tool cases, and is not a
licensee. The district court found that the Rooster sales
agreement is also a patent license, because the agreement
authorizes Rooster to obtain the Travel Caddy products
from other producers if Travel Caddy does not provide the
products on the same terms. This agreement, entitled “An
Agreement between Rooster Products International, Inc.
and Travel Caddy Inc. dba as Travelon,” includes provisions
relating to supply, delivery, price, quantity, and other terms
appropriate to commercial sales and distribution arrange-
ments. The sales rights are exclusive to Rooster, as pro-
vided in ¶4, provided that minimum sales volumes are met
(¶5).

¶4. . . . Travelon grants Rooster the Exclusive
worldwide rights and license as provided in this
Agreement, to the sale of the Products in the Chan-
nels. During the term of this Agreement, any cur-
rent or future products within the Category
developed or sourced by Travelon can only be sold to
the Channels by Rooster with the exception of the
specific products currently being distributed by
other companies in the Channels that are listed in
Attachment F.

Paragraph 9 is cited by Union Rich as providing a patent
license:
11 OUTSIDE THE BOX v. TRAVEL CADDY

¶9. Rooster reserves the right to source the Prod-
ucts from other manufacturers upon timely notice of
such sourcing to Travelon. Rooster will not contract
for manufacture of the Product(s) directly or
through any third parties with manufacturers who
have made or are then currently making the Prod-
uct(s) for Travelon. Travelon will always have the
opportunity to meet the price, delivery terms and
other terms for any Travelon designed items.
Rooster will provide Travelon with the competing
manufacturer’s price and a sample from that manu-
facturer for comparison at least 10 days prior to
Rooster contracting with another third party manu-
facturer. If Travelon is unable to meet these prices
and terms then Rooster will pay a Royalty of 2.5%
for jointly owned products; 3% for non-patented
Travelon designed items; and 5% for patented and
patent pending items. If within three years from
the date of first filing, the patent has not been ap-
proved on a patent pending item, then 1% of the
Royalty (that is an amount equal to 20% of the
original 5%) will be refunded to Rooster, provided
that if the Patent is ultimately approved between
three and four and one-half years from the date of
first filing, then Rooster shall repay Travelon this
additional 1% within 90 days of such approval.
Royalty payments will be based on the Cost of
Goods, that is, the Purchase Price to Rooster. Prod-
ucts that Rooster sources from other manufacturers
pursuant to this paragraph will count toward the
Minimum.

Union Rich argues that the agreement is a patent license
and Travel Caddy maintains that it is a distribution agree-
ment with a fallback safeguard that permits Rooster to seek
other sources of supply if Travel Caddy cannot supply
OUTSIDE THE BOX v. TRAVEL CADDY 12

Rooster’s needs at a competitive price. Indeed, the district
court had previously recognized that the agreement terms
were insufficient to give Rooster standing to join in the suit.
Outside the Box Innovations, LLC v. Travel Caddy, Inc., No.
05-cv-2482, 2007 U.S. Dist. LEXIS 96069, at *23-26 (N.D.
Ga. Mar. 27, 2007) (denying Union Rich’s motion for joinder
pursuant to Rule 19 of the Federal Rules of Civil Procedure).

The district court held, however, that this agreement
was a patent license for purposes of 37 C.F.R. §1.27(a)(2).
The court rejected Travel Caddy’s description of ¶9 as a
contingency provision, and held that ¶9 was a license,
although never invoked, and that this deprived Travel
Caddy of its small entity status. Thus the court found that
“Travel Caddy’s false claim of small entity status was un-
doubtedly material,” and found intent to deceive because
“Nelson, an experienced patent attorney, is responsible for
being familiar with such standards. Under these circum-
stances, the Court finds that an inference of Travel Caddy’s
intent to deceive the PTO has been established.” Inequita-
ble Conduct and Validity op., at *55-56.

As noted, materiality and intent are two separate and
distinct requirements in a proper inequitable conduct analy-
sis, and both must be shown by clear and convincing evi-
dence. We turn first to the level of materiality required. In
this court’s recent Therasense decision – which issued
during the pendency of this appeal – the court held that, “as
a general matter, the materiality required to establish
inequitable conduct is but-for materiality.” 649 F.3d at
1291. The court recognized an exception to this general
rule, however, stating that: “[w]here the patentee has
engaged in affirmative acts of egregious misconduct, such as
the filing of an unmistakably false affidavit, the misconduct
is material.” Id. at 1292 (citations omitted). In other words,
a false affidavit or declaration is per se material. Although
13 OUTSIDE THE BOX v. TRAVEL CADDY

on its face, it appears that a false declaration of small entity
status would fall within the definition of an “unmistakably
false affidavit,” particularly since a party that claims enti-
tlement to small entity status does so in a sworn written
declaration, we need not decide that question. 2 Even if a
false assertion of small entity status were per se material,
the requirements of Therasense are not met here because
there was no clear and convincing evidence of intent to
deceive the PTO. Specifically, there was no evidence that
anyone involved in the patent prosecution knew that a
patent license had been granted to a large entity and delib-
erately withheld that information in order to pay small
entity fees. It was not unreasonable for Travel Caddy to
view the Rooster agreement as a distributorship of products
made by Travel Caddy, with protection to Rooster to obtain
alternative supply if Travel Caddy failed to provide the
product.

Where there is no evidence that small entity status was
deliberately falsely claimed, a finding of unenforceability is
inappropriate. Importantly, the regulations do not contem-
plate that an incorrect claim of small entity status, with no
evidence of bad faith, is punishable by loss of the patent.
Instead, 37 C.F.R. §1.28 provides that good faith mistakes
can be remedied by making a deficiency payment. 3 In other

2 Indeed, when asked whether he agreed that “the na-
ture of the certification is essentially an affidavit,” counsel
for Travel Caddy responded “I do. It’s a sworn statement. I
do your honor.” Oral Argument at 11:30, available at
http://www.cafc.uscourts.gov/oral-argument-recordings
/2009-1171/all.
3 37 C.F.R. §1.28 states that:

(c) How errors in small entity status are excused. If
status as a small entity is established in good faith,
and fees as a small entity are paid in good faith, in
OUTSIDE THE BOX v. TRAVEL CADDY 14

words, the regulations specifically contemplate that there
can be good faith errors in asserting entitlement to small
entity status. Thus, where, as here, there is no specific
intent to deceive, underpayment of the fee can be remedied
by payment of the deficiency, not by eradication of the
patent.

The district court erred in holding the Travel Caddy
patents unenforceable based on Travel Caddy’s purported
loss of small entity status. The ruling of inequitable conduct
on this ground is reversed.

II

VALIDITY

The district court held claims 1-4 (all the claims) of the
’992 patent, and claims 1-4, 6-11, 13-22, 24-29, and 31-32 of
the ’104 patent, invalid on the ground of obviousness. The
court relied on various combinations of five references: U.S.
Patents Nos. 6,161,665 (“Hoover”), 5,813,445 (“Christman”),

any application or patent, and it is later discovered
that such status as a small entity was established in
error, or that through error the Office was not noti-
fied of a loss of entitlement to small entity status as
required by §1.27(g)(2), the error will be excused
upon: compliance with the separate submission and
itemization requirements of paragraphs (c)(1) and
(c)(2) of this section, and the deficiency payment re-
quirement of paragraph (c)(2) of this section . . . .

The regulations state that the deficiency payment “is the
difference between the current fee amount (for other than a
small entity) on the date the deficiency is paid in full and
the amount of the previous erroneous (small entity) fee
payment.” 37 C.F.R. §1.28(c)(2)(i). The provision for defi-
ciency payment does not include a penalty amount.
15 OUTSIDE THE BOX v. TRAVEL CADDY

D474,891 (“Huang”), 4 2,960,136 (“Ziff”), and 5,813,530
(“Kornblatt”). The district court excluded the testimony of
Travel Caddy’s technical expert, and ruled that Travel
Caddy’s patents are invalid on the ground of obviousness.

Obviousness is a question of law, KSR International Co.
v. Teleflex Inc., 550 U.S. 398, 427 (2007), based on four
factual inquiries: the scope and content of the prior art, the
differences between the prior art and the claimed invention,
the level of ordinary skill in the field of the invention, and
any relevant objective considerations. Id. at 406 (citing
Graham v. John Deere Co., 383 U.S. 1, 17-18 (1966)). The
Court in Graham explained that these factual inquiries
promote “uniformity and definiteness,” for “[w]hat is obvious
is not a question upon which there is likely to be uniformity
of thought in every given factual context.” 383 U.S. at 18.
The patent challenger must establish obviousness by clear
and convincing evidence. Microsoft Corp. v. i4i Ltd. P’ship,
_ U.S. _, 131 S. Ct. 2238, 2242 (2011).

The district court ruled that Travel Caddy’s structure
“was an obvious solution to simple problems inherent in the
prior art patents.” Inequitable Conduct and Validity op., at
*76. Travel Caddy argues that the prior art does not show
all of the elements and limitations set forth in the claims,
and that it would not have been obvious to a skilled artisan
to select assorted parts of the various references to arrive at
the novel structures and solutions in the ’992 and ’104
patents. Travel Caddy states that such selection and com-
bination is achieved only with the hindsight knowledge of
the Travel Caddy structures and the advantages that they

4 Travel Caddy states that the Huang reference is not
prior art, because the patent priority date antedates the
reference.
OUTSIDE THE BOX v. TRAVEL CADDY 16

achieve. Union Rich responds that the district court did not
err in fact or law.

A. Exclusion of expert witness

The determination of obviousness requires determina-
tion of whether the invention as a whole would have been
obvious “to a person having ordinary skill in the art to
which said subject matter pertains.” 35 U.S.C. §103(a).
Union Rich argued that the invention was obvious, and
presented attorney argument of several prior art references.
Travel Caddy sought to rebut this argument through the
testimony of a witness having experience in this technical
field, Mr. Michael Korchmar. The district court excluded
Mr. Korchmar from testifying, stating:

Well, I’m going to rule out Mr. Korchmar’s testi-
mony as an expert, and it’s not -- I do believe that
he is very knowledgeable about the products in his
field, but I do know not see how he would be able to
address what claims mean if he’s not a lawyer. It
seems to me that is within the province of a lawyer.

T.Tr. 328:9-14 (Feb. 5, 2008), J.A. 5670. Travel Caddy
requested reconsideration, and the district court repeated
that:

This Court found that because Korchmar is not a
lawyer, he was not qualified as an expert to testify
as to what the prior art teaches and the correct in-
terpretation of patent claims in the prior art. This
ruling was not error under Sundance [Sundance,
Inc. v. DeMonte Fabricating Ltd., 550 F.3d 1356
(Fed. Cir. 2008)].

Reconsideration op., at *22. In Sundance this court held
that it was an abuse of discretion to permit an attorney to
17 OUTSIDE THE BOX v. TRAVEL CADDY

testify as an expert on issues of infringement and validity,
when the attorney was not qualified as an expert in the
technical subject matter. Travel Caddy argues that Sun-
dance reinforces the position that it was an abuse of discre-
tion to disqualify the technical expert because he is not a
lawyer.

Applying the procedural law of the regional circuit, the
Eleventh Circuit reviews the exclusion of expert testimony
on the ground of abuse of discretion. Deference is given to
the district court’s discretion in trial management “unless
the ruling is manifestly erroneous.” United States v. Fra-
zier, 387 F.3d 1244, 1258 (11th Cir. 2004) (en banc) (quoting
Gen. Elec. Co. v. Joiner, 522 U.S. 136, 142 (1997)). The
Eleventh Circuit has explained that “basing an evidentiary
ruling on an erroneous view of the law constitutes an abuse
of discretion per se.” United States v. Henderson, 409 F.3d
1293, 1297 (11th Cir. 2005).

Although this court has sustained the absence of expert
testimony in appropriate cases, see Union Carbide Corp. v.
Am. Can Co., 724 F.2d 1567, 1573 (Fed. Cir. 1984) (prior art
references and the appellant’s invention were “easily under-
standable without the need for expert explanatory testi-
mony”), the exclusion of a technical expert for the reason
that he is not a lawyer is contrary to Federal Rule of Evi-
dence 702 and the benefits of technological assistance in
resolution of technological issues.

Despite the complexity of patent law, patents are not for
inventions of law; they are for inventions of technology. The
exclusion of a technical expert may deprive the decision-
maker of knowledge and perspective relevant to the adjudi-
cation, as recognized in Rule 702:
OUTSIDE THE BOX v. TRAVEL CADDY 18

R. 702. A witness who is qualified as an expert by
knowledge, skill, experience, training, or education
may testify in the form of an opinion or otherwise if:

(a) the expert’s scientific, technical, or other knowl-
edge will help the trier of fact to understand the
evidence or to determine a fact in issue;

(b) the testimony is based on sufficient facts or data;

(c) the testimony is the product of reliable principles
and methods; and

(d) the expert has reliably applied the principles and
methods to the facts of the case.

In Endress + Hauser, Inc. v. Hawk Measurement Sys. Pty.
Ltd., 122 F.3d 1040, 1042 (Fed. Cir. 1997), the court stated
that “[i]t is of course nonsense to contend that only lawyers
or patent lawyers can be expert witnesses in a patent suit.”
In Sundance the court stated:

Admitting testimony from a person such as [at-
torney] Bliss, with no skill in the pertinent art,
serves only to cause mischief and confuse the fact-
finder. Unless a patent lawyer is also a qualified
technical expert, his testimony on these kinds of
technical issues is improper and thus inadmissible.
Because Mr. Bliss was never offered as a technical
expert, and in fact was not qualified as a technical
expert, it was an abuse of discretion for the district
court to permit him to testify as an expert on the is-
sues of noninfringement or invalidity.

550 F.3d at 1362.
19 OUTSIDE THE BOX v. TRAVEL CADDY

The courts have recognized that, although advances in
technology may in retrospect appear obvious to a judge,
stimulated by advocacy, it is relevant that the advance
eluded persons in the field. The distortions flowing from
judicial hindsight have often been remarked. See Diamond
Rubber Co. of NY v. Consol. Rubber Tire Co., 220 U.S. 428,
435 (1911) (“Knowledge after the event is always easy, and
problems once solved present no difficulties, indeed, may be
represented as never having had any . . . .”). The foil to
judicial hindsight is the testimony of persons experienced in
the field of the invention.

The exclusion of Mr. Korchmar’s expert testimony can-
not be reconciled with the Federal Rules and the guidance of
precedent. To be sure, many lawyers have technical train-
ing, but it is technological experience in the field of the
invention that guides the determination of obviousness, not
the rhetorical skill or nuanced advocacy of the lawyer. We
conclude that the exclusion of Mr. Korchmar’s testimony
because he is not a lawyer was an abuse of discretion, and
may have materially affected the district court’s ruling of
obviousness.

B. The ruling of obviousness

Union Rich argues that any error was harmless because,
whatever Mr. Korchmar might have presented if he had
been allowed to testify, the claims are invalid for obvious-
ness. The Eleventh Circuit guides that errors in admission
or exclusion of evidence may be tolerated unless they affect
the substantial rights of the parties; that is, unless the
errors “have a ‘substantial influence’ on the outcome of a
case or leave ‘grave doubt’ as to whether they affected the
outcome of a case.” Frazier, 387 F.3d at 1266 n.20 (quoting
Kotteakos v. United States, 328 U.S. 750, 764-65 (1946)). 28
U.S.C. §2111 states that courts “shall give judgment after
OUTSIDE THE BOX v. TRAVEL CADDY 20

an examination of the record without regard to errors or
defects which do not affect the substantial rights of the
parties.” See also Fed. R. Evid. 103(a) (“A party may claim
error in a ruling to admit or exclude evidence only if the
error affects a substantial right of the party . . . .”). In
Medtronic Inc. v. Intermedics, Inc., 799 F.2d 734, 741 (Fed.
Cir. 1986), this court sustained the district court’s exclusion
of some testimony of the defendant’s expert on issues of
obviousness and infringement, for although the district
court excluded the testimony on the criticized ground that
the expert “did not personally have knowledge of the prose-
cution of the patents in suit,” the exclusion was not prejudi-
cial because the testimony was cumulative.

In contrast, all of the testimony of Mr. Korchmar was
excluded. The testimony related to evidence that could have
affected the outcome, for the patents were held invalid on
the very ground for which Mr. Korchmar’s testimony was
proffered. There is no suggestion that the excluded testi-
mony was cumulative. A substantial right was indeed
affected, for obviousness depends on evidentiary facts found
and evaluated from the viewpoint of a person in the field of
the invention, as of the time of the invention. Precedent
recognizes the pitfalls of judicial hindsight exercised at the
time of litigation, the Court cautioning in KSR that “[a]
factfinder should be aware, of course, of the distortion
caused by hindsight bias and must be cautious of arguments
reliant upon ex post reasoning.” 550 U.S. at 421. See also,
e.g., Diamond Rubber, 220 U.S. at 434-35 (“Many things,
and the patent law abounds in illustrations, seem obvious
after they have been done, and, in the light of the accom-
plished result, it is often a matter of wonder how they so
long eluded the search of the discoverer and set at defiance
the speculations of inventive genius.” (quotation omitted));
Arkie Lures, Inc. v. Gene Larew Tackle, Inc., 119 F.3d 953,
956 (Fed. Cir. 1997) (“Good ideas may well appear ‘obvious’
21 OUTSIDE THE BOX v. TRAVEL CADDY

after they have been disclosed, despite having been previ-
ously unrecognized.”).

In determining whether it would have been obvious to
structure the Travel Caddy tool carry cases by selecting and
combining components from nearly half a dozen different
designs, the perspective of a person in this field of technol-
ogy can be significant. For example, the patents state that
these tool carry cases are structured to carry heavy tools,
and attribute this strength to the novel use of a continuous
closed-loop binding, an adaptation that the district court
found to be described by the continuous beading in the Ziff
reference, which is not concerned with heavy tools. Travel
Caddy points to its combination of structural strength with
economical assembly and a pleasing appearance, the com-
mercial success of its product, and the ultimate tribute of
copying by a competitor.

Travel Caddy’s offer of proof stated that Mr. Korchmar
would have testified that the cited references not only did
not show all the elements of the claims, but also that they
did not suggest the selection and combination achieved by
Travel Caddy. T.Tr. 329:3 to 331:7 (Feb. 5, 2008), J.A. 5671-
73. Such evidence is relevant to the question of obviousness
particularly in crowded fields, where small differences may
produce a nonobvious advance and commensurate commer-
cial success. Such pragmatic considerations are better
understood by artisans in the field, than by judges. See In
re Meng, 492 F.2d 843, 848 (CCPA 1974) (“[S]implicity,
particularly in an old and crowded art, may argue for rather
than against patentability. Progress in the crowded arts,
usually made in small increments, is as important as it is in
arts at the pioneer stage.” (citation omitted)). See also
Unigene Labs., Inc. v. Apotex, Inc., 655 F.3d 1352, 1360-61
(Fed. Cir. 2011) (the inquiry under §103 is not whether the
OUTSIDE THE BOX v. TRAVEL CADDY 22

claimed invention is “sufficiently simple to appear obvious
to judges after the discovery is finally made”).

The Court has explained that “[t]he emphasis on non-
obviousness is one of inquiry, not quality” of the advance.
Graham, 383 U.S. at 17. The uniform thread of such in-
quiry is that it must be made in the context of the field of
the invention. While “the common sense of those skilled in
the art demonstrates why some combinations would have
been obvious where others would not,” Leapfrog Enters., Inc.
v. Fisher-Price, Inc., 485 F.3d 1157, 1161 (Fed. Cir. 2007)
(citing KSR, 550 U.S. at 416), the determination is made not
after observing what the inventor actually did, but in light
of the state of the art before the invention was made.

Travel Caddy argues that, although many others have
designed tool carry cases, the design achieved by Travel
Caddy provided characteristics new to this crowded field,
characteristics that were recognized by the market success
of these products. To properly weigh that argument, evi-
dence of commercial response may be the most probative.
See Ashland Oil, Inc. v. Delta Resins & Refractories, Inc.,
776 F.2d 281, 306 (Fed. Cir. 1985) (“Secondary considera-
tions may be the most pertinent, probative, and revealing
evidence available to the decision maker in reaching a
conclusion on the obviousness/nonobviousness issue.”).
Although Union Rich asks this court to decide the question
of nonobviousness on our own, the exclusion of the expert’s
testimony leaves us with no better basis for decision than
was available to the trial court. Thus we remand for rede-
termination of the issue of obviousness, on the entirety of
the evidence includingexpert testimony. 5 The district

5 On appeal, Travel Caddy argues that it was de-
prived of its right to trial by jury on the factual issues
underlying the court’s obviousness determination. Specifi-
cally, Travel Caddy argues that the district court sua sponte
23 OUTSIDE THE BOX v. TRAVEL CADDY

court’s rulings of invalidity of all of the claims of the ’992
patent and claims 1-4, 6-11, 13-22, 24-29, and 31-32 of the
’104 patent are vacated.

III

INFRINGEMENT

A. Electricians Bag I

Union Rich conceded that its first tool carry case, Elec-
tricians Bag I, infringes the Travel Caddy patents. Since
some claims were held valid and are not disputed, the
remedy for infringement remains to be determined for
Electricians Bag I.

B. The ProTool Bag and Electricians Bag II

Travel Caddy appeals the district court’s summary
judgment of noninfringement by the Union Rich ProTool

ordered a non-jury evidentiary hearing on obviousness and
inequitable conduct. The record reveals that both Union
Rich and Travel Caddy requested trial by jury in their
respective pleadings and that, on August 20, 2007, Travel
Caddy requested an evidentiary hearing before the court on
inequitable conduct prior to a jury trial on the remaining
issues. The record also reveals that: (1) the district court
ordered a non-jury evidentiary hearing on validity and
enforceability of Travel Caddy’s Patents; (2) Travel Caddy
actively participated in the two-day hearing, presenting
evidence and arguments on validity; and (3) it was not until
January 6, 2009 – eleven months after the hearing – that
Travel Caddy filed a motion for reconsideration alleging
that it was deprived of its right to a jury trial on validity.
See J.A. 6008. Given our decision to remand with respect to
obviousness, we need not address this issue on appeal.
Travel Caddy is free to reassert its right to trial by jury
upon remand.
OUTSIDE THE BOX v. TRAVEL CADDY 24

Bag and the succeeding model of tool carry bags, the Elec-
tricians Bag II (CarryAlls Bag). The record shows the
Travel Caddy patent drawings and the accused ProTool Bag
and Electrician Bag:

Travel Caddy Br. 10.

Travel Caddy challenges the district court’s claim con-
struction and argues that even if that construction were
correct, summary judgment of noninfringement was im-
properly granted. The grant of summary judgment receives
plenary review on appeal.
25 OUTSIDE THE BOX v. TRAVEL CADDY

The district court construed thirteen terms in the as-
serted claims: “between,” “connecting between,” “joined
between,” “extending substantially entirely between the . . .
side edges,” “intermediate,” “continuous, closed loop bind-
ing,“ “flexible fabric . . . panel,” “generally rigid, fabric
covered . . . panel,” “generally semi-rigid, fabric-covered . . .
panel,” “three-sided generally rigid fabric covered box,”
“sewn into,” “margin,” and “rectangular perimeter shaped.”
Outside the Box Innovations, LLC v. Travel Caddy, Inc., No.
05-cv-2482, 2006 U.S. Dist. LEXIS 100640 (N.D. Ga. Sept.
18, 2006) (Claim Construction). On this appeal the parties
dispute only the terms shown in boldface, for example, in
claims 1 and 19 of the ’104 patent:

1. A case for carrying tools or other items compris-
ing, in combination:

[a] planar, generally rigid, fabric covered first
end panel having a generally rectangular lower sec-
tion with a bottom side edge, a front side edge and a
back side edge and a generally triangular upper sec-
tion;

a second, planar, generally rigid, fabric covered
end panel having a configuration congruent with
the first end panel and parallel to and spaced from
the first end panel and with a bottom edge, a front
side edge and a back side edge;

a planar, generally rigid, fabric covered, rectan-
gular bottom panel connecting between the first
and second panels to form a three sided, generally
rigid fabric covered box;
OUTSIDE THE BOX v. TRAVEL CADDY 26

a first, flexible, fabric front panel having a
top edge and joined between the front side edges
of the first and second end panels;

a second, flexible fabric back panel having a
top edge and joined between the back side edges
of the first and second end panels;

a single continuous, closed loop binding joining
the fabric covering the generally rigid panels and
the flexible panels, said binding extending over the
joined fabric and stitched thereto along the side
edges and bottom edges of the end panels and the
top edges of the flexible panels.

19. A case for carrying tools or other items compris-
ing, in combination:

a planar, fabric covered first end panel having a
generally rigid lower section with a bottom side
edge, a front side edge and a back side edge, and an
upper section;

a second, planar, fabric covered end panel con-
structed substantially identical to the first end
panel and having a configuration generally congru-
ent with the first end panel and parallel to and
spaced from the first end panel and, said second
panel also including a bottom edge, a front side edge
and a back side edge;

a planar, generally rigid, fabric covered, rectan-
gular perimeter shaped, bottom panel between the
first and second end panels to form a generally
three sided, generally rigid, fabric covered box with
the first and second end panels extending upwardly
from the bottom panel, said bottom panel including
27 OUTSIDE THE BOX v. TRAVEL CADDY

a front edge, a back edge, and first and second side
edges;

a first, flexible, fabric front panel having a
top edge and joined between the front side edges
of the first and second end panels;

a second, flexible fabric back panel having a
top edge and joined between the backside edges of
the first and second end panels; and

a continuous, closed loop binding extending over
fabric covering the bottom panel and the flexible
panels, said binding stitched thereto along the side
edges of the bottom panel and the side edges and
top edges of the flexible panels.

This court had previously reviewed the construction of these
terms, in an interlocutory appeal from the denial of Travel
Caddy’s request for a preliminary injunction. Outside the
Box Innovations, LLC v. Travel Caddy, Inc., 260 F. App’x
316 (Fed. Cir. 2008).

On appeal, Union Rich argues that the claim construc-
tion then presented to and accepted by the Federal Circuit
is the law of this case, and is not subject to further review.
In response, Travel Caddy contends that the district court’s
previous claim construction was not final and that “claim
construction rendered on appeal from a preliminary injunc-
tion ruling is not binding on this Court.” Travel Caddy
Reply Br. 25.

As a general rule, the law of the case doctrine “prohibits
a court from revisiting an issue once it has been decided in
pending litigation.” Transonic Sys., Inc. v. Non-Invasive
Med. Techs. Corp., 75 F. App’x 765, 774 (Fed. Cir. 2003)
OUTSIDE THE BOX v. TRAVEL CADDY 28

(citing Arizona v. California, 460 U.S. 605, 618 (1983)). The
doctrine provides that

as a matter of sound judicial practice, . . . a court
generally adheres to a decision in a prior appeal in
the case unless one of three “exceptional circum-
stances” exists: “the evidence on a subsequent trial
was substantially different, controlling authority
has since made a contrary decision of the law appli-
cable to such issues, or the decision was clearly er-
roneous and would work a manifest injustice.”

Smith Int’l, Inc. v. Hughes Tool Co., 759 F.2d 1572, 1576
(Fed. Cir. 1985) (citations omitted); see also Mendenhall v.
Barber-Greene Co., 26 F.3d 1573, 1582 (Fed. Cir. 1994)
(“The law of the case does not involve preclusion after final
judgment, but rather it regulates judicial affairs before final
judgment. It is a doctrine resting on the need for judicial
economy. A court will not generally revisit an issue once
decided in the litigation.”) (citation omitted).

The Supreme Court has made clear that “findings of fact
and conclusions of law made by a court during a preliminary
injunction proceeding are not binding on the court during
trial.” Transonic, 75 F. App’x at 774 (citing Univ. of Tex. v.
Camenisch, 451 U.S. 390, 395 (1981)). Consistent with this
principle, we have previously held that “a claim construction
reached during an appeal from a grant of preliminary
injunction is tentative and is not binding on the district
court in subsequent proceedings.” Id.; see also Glaxo Grp.
Ltd. v. Apotex, Inc., 376 F.3d 1339, 1346 (Fed. Cir. 2004)
(“An appellate court’s preliminary injunction opinion has no
conclusive bearing at the trial on the merits and is not
binding on a subsequent panel.”).
29 OUTSIDE THE BOX v. TRAVEL CADDY

This issue most often arises in cases where the district
court engages in an initial, tentative claim construction
specifically for purposes of the preliminary injunction with-
out a hearing and without significant discovery. See Gutt-
man, Inc. v. Kopykake Enters., 302 F.3d 1352, 1361 (Fed.
Cir. 2002) (district courts can “engage in a rolling claim
construction,” particularly where the issues involved are
complex and that construction at the preliminary injunction
stage may evolve at later stages because “motions for a
preliminary injunction may come for decision before signifi-
cant discovery has occurred”); see also Transonic, 75 F.
App’x at 774 (“A district court therefore is at liberty to
change the construction of a claim term as the record in a
case evolves after a preliminary injunction appeal.”). In
contrast, where the district court has conducted a separate
full Markman hearing prior to rendering its claim construc-
tion at the preliminary injunction stage, and there is no new
evidence that would alter that construction, arguments
concerning the preliminary or tentative nature of the claim
construction are less availing. See Ecolab Inc. v. John-
sonDiversey, Inc., 95 F. App’x 322, 331 (Fed. Cir. 2004)
(recognizing that, “in a preliminary injunction proceeding,
claim construction is often tentative and is subject to revi-
sion following more plenary proceedings” and that “further
proceedings in this case, such as a claim construction hear-
ing, may shed additional light on the claim construction
inquiry”).

Although the general rule is that tentative claim con-
struction for preliminary injunction purposes does not
remove the issue from later review after the facts are elabo-
rated, here, the district court’s claim construction decision
issued after a full Markman hearing, and the parties have
OUTSIDE THE BOX v. TRAVEL CADDY 30

not identified any new factual findings. 6 Given this posture,
there is some force to Union Rich’s position that this court’s
prior decision affirming the district court’s claim construc-
tion constitutes law of the case. We need not decide this
issue, however, because, even if the law of the case doctrine
does not apply, we find that the district court correctly
construed the disputed claim terms. 7

C. ProTool Bag

The district court construed the terms “between,”
“joined between,” and “connecting between,” and granted
summary judgment of noninfringement. The court con-
strued “between” to mean “[i]n the interval defined by two
end points; here, the outer edge of the end panels of the
case.” Infringement op., at *19 (quoting Claim Construction
op., at *3). The court construed “joined between” to mean

6 Tellingly, in its motion to stay proceedings pending
appeal of the district court’s preliminary injunction decision,
Travel Caddy argued that the district court’s claim con-
struction constituted law of the case:

In as much as the issues on appeal are directed to
the Markman definitions adopted by the Court and
their application to the accused products, a stay is
appropriate. These definitions constitute the law of
the case, are ripe for appeal as a matter of right and
the outcome will directly affect any future trial.

Outside the Box Innovations, LLC v. Travel Caddy, No. 1:05-
cv-2482 (N.D. Ga. April 5, 2007), ECF No. 399 at 3; J.A.
4674.
7 The dissent mischaracterizes our discussion of the
law of the case, suggesting that we have somehow created a
broad rule that claim construction at the preliminary in-
junction stage is always the law of the case. We have done
no such thing. Because the dissent’s concerns are premised
on inaccurate representations, we need not address them.
31 OUTSIDE THE BOX v. TRAVEL CADDY

“[f]astened in and through the interval defined by two end
points; here, the outer edge of the end panels of the case.”
Id. The court construed “connecting between” to mean
“[l]inking or bridging the interval defined by two end points;
here, the outer edge of the end panels of the case.” Id. The
district court held that this means that all of the asserted
claims of the ’992 and ’104 patents require that the bottom
and front and back panels do not extend beyond the end
panels, and found that “[t]he bottom panel, as well as the
front and back panels, of the ProTool Bag, all extend beyond
the edges of the end panels.” Infringement op., at *20.

On appeal, Travel Caddy argues that the district court’s
construction of “between,” “joined between,” and “connecting
between” is erroneous, and that these terms, correctly
construed, encompass the structure of the ProTool Bag.
Specifically, Travel Caddy argues that: (1) “between” actu-
ally means “between and extending beyond”; and (2) Figure
10 of the ’104 patent embodies a bag where the bottom panel
extends beyond the end panel. 8

8 Travel Caddy argues that Union Rich’s technical ex-
pert, Dr. Radhakrishnaiah Parachuru, admitted that Figure
10 shows a bag with a bottom panel extending beyond the
end panels and labeled the diagram with the words “exten-
sion of bottom panel.” Parachuru Dep. 235:10-236:15 (June
6, 2006), J.A. 2194-2195. In response, Union Rich argues
that “Dr. Parachuru’s mark-up of Fig. 10 is consistent with
this Court’s explanation of Fig. 4 as an explanation that the
binding wraps around a terminal portion of the front panel
that is coterminous with the terminal portion of the fabric-
covered bottom panel.” Union Rich Br. 52. Regardless of
whose theory they support, Dr. Parachuru’s deposition
testimony and handwritten notation are insufficient to
overcome the language in the specification which, as ex-
plained below, identifies the area in question as the binding.
OUTSIDE THE BOX v. TRAVEL CADDY 32

The prior panel addressed these same issues and found
that, although “Travel Caddy is correct that the preposition
‘between’ could be used to describe something that extends
beyond the bounds of the objects of the preposition . . . the
written description and drawings of the ’104 patent do not
support such a broad interpretation of the term ‘between’ in
the claims.” Outside the Box, 260 F. App’x at 319. We
agree.

A careful review of the relevant patent figures and the
corresponding written description reveals that the portion of
Figure 10 that seems to protrude beyond the end panel is
not part of the bottom panel but instead is the binding
connecting the fabric panels, as shown in Figure 4.

The written description for the embodiment in Figure 10
provides that “[a]ll of the described panels are fabric cov-
ered, preferably by two layers of fabric which are sewn
together and retained along their edges by a binding 210.”
’104 Patent, col.6, ll.11-14. The written description further
indicates that the binding used “is substantially similar to
33 OUTSIDE THE BOX v. TRAVEL CADDY

or the same as previously described with respect to the
other embodiments of the invention.” Id. at col.6, ll.39-43.

Figure 4 of the ’104 patent is the only figure depicting
the binding used in the claimed invention. The specification
states that “[a]n important aspect of the invention is the
utilization of a single closed loop binding 40 in FIG. 4 which
serves to join all of the flexible fabric component panels or
parts 20, 22, 28 of the carrying case.” ’104 patent, col.3,
ll.36-39 (emphasis added). As Union Rich correctly notes,
the specification does not disclose any other way to join the
panels. Because Figure 4 is the only representation of
binding of the panels, and the written description states
that the binding used for the embodiment in Figure 10 is
“substantially similar to or the same” as that previously
described, it follows that the binding in Figure 10 is the
same as that described in Figure 4. In other words, the
portion of Figure 10 that appears to stick out from the end
panel – which Travel Caddy points to as evidence that the
bottom panel extends beyond the end panel – is actually the
binding of the panels.

Given the language in the specification, we agree with
the district court’s construction of “between” to exclude
embodiments where the bottom, front, or back panels extend
beyond the edges of the end panels. We decline the dissent’s
invitation to substitute its own claim construction for that of
the district court and a prior panel of this court and to
engage in appellate fact-finding. Because we find that the
district court’s claim construction was correct, we affirm its
decision granting summary judgment of noninfringement
with respect to the ProTool bag.
OUTSIDE THE BOX v. TRAVEL CADDY 34

D. Electricians Bag II

The district court granted summary judgment of no in-
fringement as to Electricians Bag II; this is the modified
design to which Union Rich switched after controversy arose
concerning Electricians Bag I. The Electricians Bag II has
“reinforced boards placed in between the fabric of the front
and back panels.” Infringement op., at *6 n.2. These rein-
forced boards are made of plywood. The district court
construed “flexible fabric . . . panel” to mean “[a] panel made
of a fabric that is capable of being bent or flexed.” Id. at *22
(quoting Claim Construction op., at *3), and held that the
rigid plywood boards, although covered by fabric, precluded
infringement by the Electricians Bag II.

Travel Caddy argues that the district court’s construc-
tion of “flexible fabric front panel” is erroneous, for the front
and back panels are made of fabric, and the use of “compris-
ing” in the claim does not exclude the addition of plywood to
the fabric panels. We do not discern such error, for we
agree with the district court that “flexible fabric front panel”
is not reasonably construed to include a plywood-stiffened
fabric panel. Although “[i]t is fundamental that one cannot
avoid infringement merely by adding elements if each
element recited in the claims is found in the accused device,”
A.B. Dick Co. v. Burroughs Corporation, 713 F.2d 700, 703
(Fed. Cir. 1983), here the addition of plywood to the fabric
panels removed the flexibility of the fabric. The usage
“comprising” means that additional components may be
present in the device, but does not change the elements that
are stated in the claim. Power Mosfet Techs., L.L.C. v.
Siemens AG, 378 F.3d 1396, 1409 (Fed. Cir. 2004). The
plywood is not simply an additional element, but a material
change in the fabric panel. We agree that the plywood
board is “an additional element [that] changed the structure
35 OUTSIDE THE BOX v. TRAVEL CADDY

of the purported infringing object such that it could not
infringe.” Outside the Box, 260 F. App’x at 321.

The summary judgment of noninfringement as to Elec-
tricians Bag II is affirmed.

SUMMARY

The judgment that the ’992 and ’104 patents are unen-
forceable for inequitable conduct is reversed. The rulings of
invalidity of claims of the ’992 and ’104 patents are vacated;
we remand for redetermination of the issue of obviousness
of the ’992 patent and claims 1-4, 6-11, 13-22, 24-29, and 31-
32 of the ’104 patent. 9 We affirm: (1) the unchallenged
judgment of infringement by Union Rich’s Electricians Bag
I; and (2) the judgment of noninfringement by the ProTool
Bag and the Electricians Bag II. We remand for determina-
tion of remedy with respect to infringement by the Electri-
cians Bag I.

Each party shall bear its costs on this appeal.

AFFIRMED IN PART, VACATED IN PART,
REVERSED IN PART, and REMANDED

9 Of course, we recognize that, given our ruling re-
garding noninfringement, Union Rich may choose not to
pursue its counterclaim of invalidity on obviousness
grounds.
 United States Court of Appeals
for the Federal Circuit
__________________________

OUTSIDE THE BOX INNOVATIONS, LLC (doing
business as Union Rich USA),
Plaintiff-Appellee,
AND

BONAKA LIMITED BONAKA, PLASTIC
MANUFACTURING CO., LTD.,
AND UNION RICH PLASTIC FACTORY, LTD.,
Counterclaim Defendants-Appellees,
AND

CHRISTOPHER URE, MATT WILLIAMS, TERRY
KINSKEY AND LYNN MARTINEAU,
Counterclaim Defendants,
v.
TRAVEL CADDY, INC.
Defendant/Counterclaimant-
Appellant,
AND

ROOSTER PRODUCTS (doing business as The Rooster
Group),
Defendant/Counterclaimant.
__________________________

2009-1171
__________________________
OUTSIDE THE BOX v. TRAVEL CADDY 2

Appeal from the United States District Court for the
Northern District of Georgia in Case No. 1:05-CV-2482,
Senior Judge Orinda D. Evans.
__________________________

NEWMAN, Circuit Judge, concurring in part, dissenting in
part.
I concur in much of the court’s decision, but respect-
fully dissent in three areas, summarized as follows:
First, the panel majority states that misstatement of
small entity status is per se material to patentability, and
thus can render the patent permanently unenforceable for
“inequitable conduct.” Although the panel majority
correctly acts to reverse the district court’s factual finding
of intent to deceive, my colleagues leave intact the district
court’s flawed criterion of per se materiality. Thus the
panel majority continues to endorse the principle of
elimination of patent rights based on miscalculation of a
fee. Statute, regulation, and precedent do not support
this treatment.
Second, the panel majority states that the pretrial
claim construction on interlocutory appeal of a prelimi-
nary injunction is the “law of the case,” and cannot be
reviewed on final appeal of the district court’s final judg-
ment. However, a preliminary injunction ruling is based
on likelihoods and equities, and does not insulate the
issues from appeal of the final judgment. The panel
majority is incorrect in suggesting that such preliminary
rulings are the law of the case.
Third, the panel majority construes the patent claims
to exclude the preferred embodiment shown in Figure 10
of the patent. The accused ProTool Bag is identical to the
bag in Figure 10. However, the court construes the claims
to exclude Figure 10, and thus to avoid infringement.
3 OUTSIDE THE BOX v. TRAVEL CADDY

That construction is incorrect, as is the decision of nonin-
fringement based on that construction.
I
THE SMALL ENTITY FEE
Travel Caddy has fewer than five hundred employees.
However, the small entity fee-reduction regulation pro-
vides an exception to fee reduction when the small entity
has licensed the patent to a large entity. Travel Caddy
had a distributorship agreement with The Rooster Group,
which was not a small entity when the employees of its
Mexican subsidiary are counted. This distributorship
agreement, in addition to the commercial terms of supply,
price, payment, etc., authorized The Rooster Group to
obtain the Travel Caddy products from an alternate
source if Travel Caddy can not meet the alternative
source’s price terms; the distributorship agreement pro-
vided that if this occurred “Rooster will pay a Royalty of . .
. 5% for patented and patent pending items.” This contin-
gent arrangement was held by the district court to defeat
Travel Caddy’s small entity status.
A
On reviewing the district court’s ruling of inequitable
conduct, the panel majority holds that “a false assertion of
small entity status [is] per se material.” Maj. op. at 13.
Although the panel majority also states that “we need not
decide that question” of materiality, id., they do decide
the question of materiality, for they decline to correct the
district court’s ruling that improper payment of the small
entity fee is material to patentability.
On the question of intent to deceive, the panel major-
ity correctly rules that deceptive intent was not estab-
lished. The district court’s ruling that attorney error
establishes deceptive intent when the attorney is experi-
OUTSIDE THE BOX v. TRAVEL CADDY 4

enced is surely not supportable as applied to the payment
of an incorrect fee. The principle of Therasense, Inc. v.
Becton, Dickinson & Co., 649 F.3d 1276 (Fed. Cir. 2011)
(en banc) should be applied, for the “affirmative acts of
egregious misconduct” contemplated in Therasense relate
to the substance of patentability, not the payment of an
incorrect fee. In addition, the policy embodied in 37
C.F.R. §1.28(c) shows recognition of the possibility of
error, and the intention that such error would be correct-
able without penalty. This court should be mindful of
opening another path whereby “[l]eft unfettered, the
inequitable conduct doctrine has plagued not only the
courts but also the entire patent system.” Therasense,
649 F.3d at 1289.
My colleagues err in ruling that the filing of the small
entity statement by affidavit renders the incorrect state-
ment “per se material.” Immateriality of an affidavit that
is not the basis of the patent grant was long ago estab-
lished. In Corona Cord Tire Co. v. Dovan Chem. Corp.,
276 U.S. 358, 374 (1928), the Court stated the inappropri-
ateness of extinguishing a patent for a misrepresentation
that did not affect patentability, stating that
the affidavits, though perhaps reckless, were not
the basis for [the grant of the patent] or essen-
tially material to its issue. The reasonable pre-
sumption of validity furnished by the grant of the
patent, therefore, would not seem to be destroyed.
The en banc court reiterated in Therasense that “this
doctrine [inequitable conduct] should only be applied in
instances where the patentee’s misconduct resulted in the
unfair benefit of receiving an unwarranted claim.” 649
F.3d at 1292; see id. (“[E]nforcement of an otherwise valid
patent does not injure the public merely because of mis-
conduct, lurking somewhere in patent prosecution, that
5 OUTSIDE THE BOX v. TRAVEL CADDY

was immaterial to the patent’s issuance.”). The court’s
equivocation on materiality and intent based on error in
small entity status simply adds uncertainty when such is
unwarranted.
B
The underlying question is whether a contingent pat-
ent license to a distributor, although not implemented,
defeats small entity status as a matter of statutory inter-
pretation. The district court so held. The panel majority
does not discuss this holding; leaving it as a cloud on
possibly many small businesses. This issue warrants
review.
II
LAW OF THE CASE
The “law of the case” does not apply to preliminary
rulings made on pretrial motion. My colleagues hold that
this court’s prior review of a pretrial denial of a motion for
injunction pendente lite may be treated as the law of the
case, without review of the information adduced at trial.
That is not the rule, and for sound reason, as illustrated
herein. The result of the majority’s shortcut is its failure
to rethink the application of the claims to the patented
tool bag leading to the majority’s retention of an errone-
ous claim construction.
The district court’s ruling on motion for a preliminary
injunction is based on likelihoods, equities, and discretion,
and receives interlocutory review on those grounds. The
preliminary decision and its premises are not the “law of
the case,” and these issues cannot be refused appellate
review on final judgment. See Glaxo Grp. Ltd. v. Apotex,
Inc., 376 F.3d 1339, 1346 (Fed. Cir. 2004) (“An appellate
court’s preliminary injunction opinion has no conclusive
bearing at the trial on the merits and is not binding on a
OUTSIDE THE BOX v. TRAVEL CADDY 6

subsequent panel.”); Mendenhall v. Barber–Greene Co., 26
F.3d 1573, 1581 (Fed. Cir. 1994) (“[A] decision by an
appellate court on an interlocutory appeal is no more final
than the appealed decision itself.”); cf. Bio–Technology
Gen. Corp. v. Genentech, Inc., 267 F.3d 1325, 1329 (Fed.
Cir. 2001) (stating that the court was bound by two inter-
locutory appeals of the same issues of claim construction).
Before final judgment, a court may “reconsider any
portion of its decision and reopen any part of the case.”
Marconi Wireless Tel. Co. v. United States, 320 U.S. 1, 47
(1943). This rule recognizes that interim rulings may be
appropriate as the proceedings unfold, although interim
findings and conclusions may be changed by the revela-
tions of trial. A pretrial motion for injunction pendente
lite requires an estimation of likelihoods; it does not
pretend to be a final decision. I need not belabor the
judicial experience whereby witnesses and documents and
argument may affect the outcome of a situation whose
“likelihood” may have appeared otherwise at the pretrial
preliminary injunction stage.
Thus the Court has reiterated that findings of fact
and conclusions of law at the preliminary injunction stage
are not binding. Univ. of Texas v. Camenisch, 451 U.S.
390, 395 (1981) (“The purpose of a preliminary injunction
is merely to preserve the relative positions of the parties
until a trial on the merits can be held. Given this limited
purpose, and given the haste that is often necessary if
those positions are to be preserved, a preliminary injunc-
tion is customarily granted on the basis of procedures that
are less formal and evidence that is less complete than in
a trial on the merits.”). This protocol recognizes that such
motions are decided on likelihoods and equities before all
the evidence is in.
7 OUTSIDE THE BOX v. TRAVEL CADDY

Nonetheless, the panel majority declines to revisit
this court’s pretrial ruling on claim construction. Prece-
dent counsels otherwise. In SEB S.A. v. Montgomery
Ward & Co., Inc., 594 F.3d 1360, 1368 (Fed. Cir. 2010),
the court held that the “prior affirmance of the district
court’s preliminary injunction order does not make the
district court’s claim construction in its 1999 opinion the
law of the case.”
My colleagues propose to avoid precedent by stating
that there was a Markman hearing and “the parties have
not identified any new factual findings.” Maj. op. 29–30.
However, this court in SEB v. Montgomery Ward rejected
that position, for the district court in SEB had explained
that “[t]he application for the preliminary injunction was
combined with the Markman hearing.” 77 F. Supp. 2d
399, 400 (S.D.N.Y. 1999), aff’d, 243 F.3d 566 (Fed. Cir.
2000) (Table). My colleagues’ equivocal ruling today
simply creates conflict with precedent, as well as moves
patent cases further from standard litigation practices
and safeguards.
III
INFRINGEMENT
The panel majority holds that the accused ProTool
Bag, which is a copy of Travel Caddy’s bag shown in
Figure 10 of the ’104 patent, does not infringe the claims
directed to Figure 10. The panel majority construes the
claims of the patents to exclude the bag in Figure 10, and
thus to exclude infringement by the bag that Union Rich
copied from Travel Caddy’s embodiment of Figure 10:
OUTSIDE THE BOX v. TRAVEL CADDY 8

The question of infringement related principally to the
terms “panels” and “continuous closed loop binding,” in
claim 19 of the ’104 patent:
19. A case for car[ry]ing tools or other items
comprising, in combination:
a planar, fabric covered first end panel having
a generally rigid lower section with a bottom side
edge, a front side edge and a back side edge, and
an upper section;
a second, planar, fabric covered end panel
constructed substantially identical to the first end
panel and having a configuration generally con-
gruent with the first end panel and parallel to and
spaced from the first end panel and, said second
panel also including a bottom edge, a front side
edge and a back side edge;
a planar, generally rigid, fabric covered, rec-
tangular perimeter shaped, bottom panel between
the first and second end panels to form a gener-
ally three sided, generally rigid, fabric covered box
with the first and second end panels extending
upwardly from the bottom panel, said bottom
9 OUTSIDE THE BOX v. TRAVEL CADDY

panel including a front edge, a back edge, and first
and second side edges;
a first, flexible, fabric front panel having a top
edge and joined between the front side edges of
the first and second end panels;
a second, flexible fabric back panel having a
top edge and joined between the backside edges of
the first and second end panels; and
a continuous, closed loop binding extending
over fabric covering the bottom panel and the
flexible panels, said binding stitched thereto along
the side edges of the bottom panel and the side
edges and top edges of the flexible panels.
Viewing “panels” and “binding” as technical terms, “[a]
technical term used in a patent document is interpreted
as having the meaning that it would be given by persons
experienced in the field of invention, unless it is apparent
from the patent and the prosecution history that the
inventor used the term with a different meaning.”
Hoechst Celanese Corp. v. BP Chems. Ltd., 78 F.3d 1575,
1578 (Fed. Cir. 1996).
Union Rich argued that the ProTool Bag does not
have the claimed edges of the bottom panel and front and
back panels as described in the specification as extending
beyond the end panels. However, even Union Rich’s
expert, Dr. R. Parachuru, agreed that Figure 10 shows a
bag whose bottom panel extends beyond the end panel:
Q. But as you sit here -- and would this portion
that extends beyond the end panel that appears at
the bottom of item 202 of Figure 10, does this ap-
pear to be a part of the bottom panel?
A. Yes, to me, that’s part of the bottom panel.
OUTSIDE THE BOX v. TRAVEL CADDY 10

Q. And again, it extends beyond the end panels?
A. End panels, yes.
Q. Is that a yes?
A. Yes.
Parachuru Dep. 235:10–20 (June 6, 2006), J.A. 2194.
This is not complex technology, and the invention is
illustrated in the drawing of the device that is the subject
of the claims. The district court construed “continuous,
closed loop binding” of claim 19 to mean “[a] binding that
is folded over and stretched to provide a means to join the
fabric edges of component parts of the case in a closed
loop; a ‘continuous’ closed loop binding extends uninter-
rupted with no apparent beginning or ending point.”
Outside the Box Innovations, LLC v. Travel Caddy, Inc.,
No. 05-cv-2482, 2006 U.S. Dist. LEXIS 100640, at *3
(N.D. Ga. Sept. 18, 2006). The parties do not dispute this
definition. The binding is defined in the specification as
“extending over fabric covering the bottom panel and the
flexible [front and back] panels” and stitched to the panels
“along the side edges of the bottom panel and the side
edges and top edges of the flexible panels.” ’104 patent,
col.8 ll.57-61. It does not conflict with the description of
the edges of the panels, as the patent drawings make
clear. My colleagues’ view that the binding cannot be an
edge is contrary to the rules of construction.
The patent drawings illustrate the invention, and
generally represent preferred embodiments of the inven-
tion. See Primos, Inc. v. Hunter’s Specialties, Inc., 451
F.3d 841, 848 (Fed. Cir. 2006) (the patent drawings are
evidence of the claimed invention). A claim construction
that excludes a preferred embodiment “is rarely the
correct interpretation; such an interpretation requires
highly persuasive evidentiary support.” Modine Mfg. Co.
11 OUTSIDE THE BOX v. TRAVEL CADDY

v. Int’l Trade Comm’n, 75 F.3d 1545, 1550 (Fed. Cir.
1996). As stated in Hoechst, 78 F.3d at 1581 “it is
unlikely that an inventor would define the invention in a
way that excluded the preferred embodiment, or that
persons of skill in this field would read the specification in
such a way.”
It is highly unusual to construe routine patent claims
so as to exclude the embodiments in the drawings, when
there is no prosecution disclaimer. The purpose of patent
drawings is to focus the subject matter on which a patent
is sought. See Oatey Co. v. IPS Corp., 514 F.3d 1271,
1277 (Fed. Cir. 2008) (rejecting claim construction that
excluded the embodiment in the patent drawing); MBO
Labs., Inc. v. Becton, Dickinson & Co., 474 F.3d 1323,
1333 (Fed. Cir. 2007) (rejecting claim construction of
“adjacent” to mean contiguous or connected when patent
drawings illustrated parts next to each other but not
connected); Funai Elec. Co. Ltd. v. Daewoo Elecs. Corp.,
616 F.3d 1357, 1371 (Fed. Cir. 2010) (declining to require
that a series circuit junction point lie between the erasing
heads when the patent drawing shows a series junction
point not located between the two erasing heads); Primos,
451 F.3d at 848 (declining to require the term “engaging”
to mean interlocking when patent drawings illustrated
touching).
The panel majority’s claim construction to exclude the
embodiment in Figure 10 is incorrect. On the correct
claim construction, there is no dispute that the ProTool
Bag infringes claim 19. I respectfully dissent.