Kearney & Trecker Corporation v. Giddings & Lewis, Inc.

PELL, Circuit Judge

(dissenting).

While appreciating the closely reasoned, analytical opinion of Judge Stevens, I find that I am unable to concur in the result reached. Therefore I respectfully dissent.

Condensing the majority opinion to its pivotal point, although admittedly not an easy task considering its breadth, it appears to me that it imposes punishment for misconduct not legally related to patent claims sought to be enforced.

We have here patent claims in suit which the district court found to be valid and infringed. The majority opinion does not reach an opposite result other than upon the matter of the alleged misconduct, yet the claims are cut off as a basis for judicial enforcement because of ex post facto circumstances.

I cannot help but feel that this court, although not purporting to do so, is nevertheless using this litigation as a vehicle for punishing conduct which it finds reprehensible.

Today’s climate of lack of public confidence in governmental officials is not conducive to judicial condonation of any unethical or otherwise improper behavior on the part of such officials. Nothing I say herein is to be taken as any approval of the conduct of either the plaintiff or *601Beall subsequent to the latter’s retirement and prior to the plaintiff’s abandonment of the claims acquired by reissue. Although plaintiff in taking its “extensive remedial action” did not concede any impropriety in the employment of Beall nor that any advantage was obtained through the use of his services on the two reissues, the majority opinion. terms Beall’s conduct indefensible. For the purposes of this dissent, I am accepting this categorization.

However, the indefensible conduct occurred subsequent to the granting of the original patent which included claims 15, 19 and 20. The district court found no irregularity in any prior conduct and the majority opinion accepts the finding. Instead of letting the matter stand there and proceeding to the impact of 35 U.S.C. § 288 on the situation, the majority opinion relates the prior events as relevant “background.” How so ? I would like to dispel my lingering suspicion that the majority feels that the prior conduct itself constituted some crippling irregularity.

At most, the activity in question might have caused Beall to feel that he was suspect and perhaps it should have indicated to him that he should have no post-retirement connection with the patent, thereby making having the connection in fact more reprehensible. But the point of subsequent reprehensibility is not herein denied; rather, my thesis is that subsequent activity should not be retroactively applied to invalidate that which was otherwise validly achieved without found irregularity.

The majority opinion achieves retrospective invalidation via 35 U.S.C. § 288 in the words “without deceptive intention” but ignores the clear mandate of 35 U.S.C. § 252 that the claims of the original patent “have effect continuously from the date of the original patent.”

The specific matter before us appears to be one of first impression and because of this country’s historical, and properly founded, animadversion to legislation smacking of ex post facto characteristics, I am unable to construe 35 U.S.C. § 288 as meaning that Congress intended any more than that the “deceptive intention” applied to patent claims of a contemporaneously effective date, some of which are invalid because of deceptive intention. The result, however, of the majority opinion is to carry back the taint to earlier claims, to visit the sins of the son upon the father.

Properly, it seems to me, the patent claims once found valid should be clothed with protective immunity not subject to being pierced by subsequent misconduct of the collateral type here involved. This, of course, would not attach where subsequent direct misuse was involved.

While the issue of deceptive intention was not before the court in Foxboro Co. v. Taylor Instrument Companies, 157 F.2d 226, 228 (2d Cir. 1946), cert. denied, 329 U.S. 800, 67 S.Ct. 494, 91 L.Ed. 684 (1947), the principle enunciated by Judge Learned Hand in that case would seem to me to be applicable: “ * * * the surrender of the original patent, resulting from the acceptance of the reissue, did not invalidate any claims which he [the original patentee] carried over into the reissue.”

Judge Hand was of the opinion, as I am, that the matter was set at rest by the amendment of the precursor of 35 U.S.C. § 252. Section 252 was taken from Section 64 of Title 351 and it is of interest to note that the prior section refers to “fraudulent or deceptive intention” but relates this only to error in connection with the original patent.

We have here in the original patent, claims of an invention filling a much needed want, one entering into immediate use and one meeting with substantial commercial success. See England v. Deere & Co., 284 F.2d 460, 463 (7th Cir. *6021960), cert. denied, 365 U.S. 870, 81 S.Ct. 904, 5 L.Ed.2d 860 (1961).

In my opinion, the plaintiff having effectively abandoned all claims other than the three which were based on the original patent, 35 U.S.C. § 252 is a proper basis for the bringing of the present action and makes proper the decision reached by the district court.

Further, in any event, I think the district court’s decision should be affirmed because of the positive ameliorating steps taken by the plaintiff. The majority opinion properly refrains from drawing any inference of misconduct from the curative actions taken. To do otherwise would be highly inconsistent with a desirable public policy. Analogies such as the lack of admission in offers to compromise and in repairing faulty premises subsequent to an accident come to mind.

Those analogies also should remind us of the underlying policy rationale that action such as that taken by plaintiff here would be discouraged if it were to be the basis of any admissions of liability (misconduct here). Instead, public policy dictates that such action should be encouraged.

It seems to me that the majority opinion, even though no inference of admission of misconduct is per se drawn from the retractive steps, nevertheless cannot but tend to discourage others from attempting to set their own houses in order. The alternative obviously is a vigorous litigative defense.

For these reasons I think the district court’s conclusion is correct “that by reason of the plaintiff’s formal abandonment of the reissue claims, any illegality in connection with the prosecution of the reissue applications does not, as a matter of law, make the original patent [claims] invalid.” Kearney & Trecker Corp. v. Giddings & Lewis, Inc., 306 F.Supp. 189, 197 (E.D.Wis.1969).

The majority opinion seems to suggest a fault in the abandonment as being belated in that it only occurred after pretrial discovery. However, there is cause from the record as a whole to believe that plaintiff, and its special trial counsel who had not been previously involved in the matters herein, considering all aspects of the matter including the termination of the employment of the long time house counsel, did act with reasonable promptitude in causing the purging steps to be taken when the pretrial discovery revealed the true state of affairs.

In any event, there is authority that purging steps may be effective at any stage of the proceedings. See, e. g., White Cap Co. v. Owens-Illinois Glass Co., 203 F.2d 694, 698 (6th Cir.), cert. denied, 346 U.S. 876, 74 S.Ct. 128, 98 L.Ed. 384 (1953); cf., Standard Oil Co. v. United States, 283 U.S. 163, 51 S.Ct. 421, 75 L.Ed. 926 (1931).

“These issues present questions of fact. * * * Whether a purge has been effected under the facts of a given case is largely discretionary with the trial court.” Preformed Line Products Co. v. Fanner Mfg. Co., 328 F.2d 265, 279 (6th Cir.), cert. denied, 379 U.S. 846, 85 S.Ct. 56, 13 L.Ed.2d 51 (1964).

I would find no abuse of discretion here, and on the issues as a whole it seems to me that we are not in a position to hold the findings on which the district court’s decision was based to be clearly erroneous. Rule 52(a), Fed.R. Civ.P., G. Leblanc Corp. v. H. & A. Selmer, Inc., 310 F.2d 449, 459 (7th Cir. 1962), cert. denied, 373 U.S. 910, 83 S.Ct. 1299, 10 L.Ed.2d 412 (1963).

Accordingly, I would affirm the judgment of the district court.

. Act of July 8, 1870, ch. 230, § 53, 16 Stat. 205, amended May 24, 1928, ch. 730, 45 Stat. 732. Section 64, as amended, is set out in 35 U.S.C.A. Appendix II at 833.