Henkel Corp. v. Procter & Gamble Co.

United States Court of Appeals for the Federal Circuit

2008-1447
(Interference No. 105, 174)

HENKEL CORPORATION,

Appellant,

v.

THE PROCTER & GAMBLE COMPANY,

Appellee.

Rudolf E. Hutz, Connolly Bove Lodge & Hutz LLP, of Wilmington, Delaware,
argued for appellant. With him on the brief were Mark E. Freeman, and Aaron R.
Ettelman.

Mark A. Charles, The Proctor & Gamble Company, of Cincinnati, Ohio, argued
for appellee.

Appealed from: United States Patent and Trademark Office,
Board of Patent Appeals and Interferences
 United States Court of Appeals for the Federal Circuit
2008-1447
(Interference No. 105,174)

HENKEL CORPORATION,

Appellant,

v.

THE PROCTER & GAMBLE COMPANY,

Appellee.

Appeal from the United States Patent and Trademark Office, Board of Patent Appeals
and Interferences.
__________________________

DECIDED: March 18, 2009
__________________________

Before LINN, PROST, and MOORE, Circuit Judges.

LINN, Circuit Judge.

Henkel Corporation (“Henkel”) appeals from a final decision of the Board of

Patent Appeals and Interferences (“the Board”), Henkel Corp. v. Procter & Gamble Co.,

Patent Interference No. 105,174 (B.P.A.I. Mar. 28, 2008) (“Board Decision”), which

awarded priority of invention to The Procter & Gamble Company (“P&G”). Because the

Board’s decision is supported by substantial evidence, we affirm.
 I. BACKGROUND 1

The technology at issue in this case relates to two-region dishwasher detergent

tablets having certain properties. Claim 1 of P&G’s U.S. Patent No. 6,399,564 is

representative of Count 2, the only count at issue in the interference:

A detergent tablet comprising a compressed portion and a non-
compressed portion wherein:
a) said compressed portion comprises a mould and dissolves at a
faster rate than said non-compressed portion on a weight by weight basis,
measured using a SOTAX dissolution test method;
b) said non-compressed portion is in solid, gel or liquid form;
c) said non-compressed portion is delivered onto said mould of said
compressed portion; and
d) said non-compressed portion is partially retained within said
mould; and wherein said non-compressed portion is affixed to said
compressed portion by forming a coating over the non-compressed layer
to secure it to the compressed portion or by hardening.

At issue in this appeal is limitation a), which requires that the compressed portion of the

tablet dissolve at a faster rate than the non-compressed portion. In Henkel Corp. v.

Proctor & Gamble Co., 485 F.3d 1370, 1375 (Fed. Cir. 2007) (“Henkel I”), we rejected

the Board’s overly restrictive interpretation of the limitation and concluded that the

limitation required “an appreciation by the inventors simply that the dissolution rate of

the compressed region is greater than the dissolution rate of the other region.” We also

concluded that Henkel had demonstrated an appreciation of this disputed limitation no

later than May 1997. Id. at 1376. Accordingly, we vacated the Board’s denial of

Henkel’s motion for priority as well as the Board’s denial (as moot) of P&G’s motions for

priority, and remanded to the Board for further proceedings. See id.

1
This is the second appeal in this case. In Henkel Corp. v. Proctor &
Gamble Co., 485 F.3d 1370 (Fed. Cir. 2007) (“Henkel I”), we discussed at length both
the background of the technology at issue and the procedural posture leading to our
vacatur and remand of the Board’s decision. We omit the bulk of those details in this
opinion, discussing only what is relevant for disposition of this appeal.

2008-1447 2
 On remand, the Board entertained P&G’s motions for priority and held, based on

the evidence of record, that “P&G has proved by at least a preponderance of the

evidence that it made, and at least one inventor appreciated, an embodiment within the

scope of Count 2, the sole count in the interference, prior to Henkel’s earliest reduction

to practice.” Board Decision at 3. Consequently, the Board awarded priority of

invention to P&G.

Henkel timely appealed. We have jurisdiction under 28 U.S.C. § 1295(a)(4)(A).

II. DISCUSSION

A. Standard of Review

Whether an invention has been reduced to practice is a question of law based on

underlying facts. Cooper v. Goldfarb, 154 F.3d 1321, 1327 (Fed. Cir. 1998).

Accordingly, the Board’s ultimate conclusion of reduction to practice is reviewed de

novo, while its underlying factual findings are reviewed for substantial evidence.

Henkel I, 485 F.3d at 1374. “Substantial evidence is more than a mere scintilla. It

means such relevant evidence as a reasonable mind might accept as adequate to

support a conclusion.” Consol. Edison Co. v. NLRB, 305 U.S. 197, 229 (1938).

B. Analysis

Following our remand in Henkel I, the Board found that P&G demonstrated an

actual reduction to practice in February 1997, Board Decision at 10, predating Henkel’s

reduction to practice in May 1997, and thus awarded priority of invention to P&G, id. at

69. In so doing, the Board made a key factual determination—that P&G inventors

appreciated by February 1997 the limitation in the count requiring that the compressed

region of the tablet dissolve at a greater rate than the non-compressed region. Id. at

2008-1447 3
61-62. Whether substantial evidence supports this finding of fact is the only issue on

appeal. Henkel contends that “the objective evidence before the Board fails to record or

establish that any P&G inventor contemporaneously appreciated, or even conceived of,

an embodiment meeting the express comparative dissolution rate limitation of Count 2

prior to Henkel’s accorded actual reduction to practice date.” Henkel’s Opening Br. at

19. P&G counters that its inventors did, in fact, appreciate the differential dissolution

rate limitation, and that the record evidence supports the Board’s decision.

“In order to establish an actual reduction to practice, the inventor must prove that:

(1) he constructed an embodiment or performed a process that met all the limitations of

the interference count; and (2) he determined that the invention would work for its

intended purpose.” Cooper, 154 F.3d at 1327. The inventor must also

“contemporaneously appreciate that the embodiment worked and that it met all the

limitations of the interference count.” Id.; see also Henkel I, 485 F.3d at 1374. As we

held in Henkel I, to demonstrate a reduction to practice of the invention at issue here the

inventors need only appreciate “that the dissolution rate of the compressed region is

greater than the dissolution rate of the other region.” Henkel I, 485 F.3d at 1375.

The Board relied primarily upon three pieces of evidence for its conclusion that

P&G inventors reduced the invention to practice prior to Henkel: a Record of Invention

by Alasdair McGregor dated November 22, 1996 (“the McGregor Record of Invention”),

J.A. 321-29, McGregor’s subsequent declaration, id. at 386-92, and a January 1997

Monthly Report by Sabine Metzger-Groom (“the Metzger-Groom Report”), id. at 371;

see also Board Decision at 53-54 (“[O]ur focus for actual reduction to practice is on

Metzger-Groom’s making and testing of the tablet [described in the McGregor Record of

2008-1447 4
Invention] and [McGregor’s] purported appreciation that the invention worked for its

intended purpose.”). In particular, the Board found that although the McGregor Record

of Invention does not itself demonstrate an appreciation for the contested comparative

dissolution rate limitation, McGregor’s subsequent testimony that he appreciated that

limitation at the time, as corroborated by the Metzger-Groom Report, was sufficient to

demonstrate appreciation for the comparative dissolution rate and thus to demonstrate

an actual reduction to practice. 2 Board Decision at 61-62, 68-69; see also id. at 3.

Because our review is confined to the question of whether the Board’s

determination is supported by substantial evidence, we turn to the evidence the Board

relied upon to determine whether it is adequate to support the Board’s conclusion. The

McGregor Record of Invention describes a “dimple” tablet—i.e., a compressed tablet

with a dimple, into which a molten mixture comprising an inert carrier and a detergent

2
We note that the Board also considered the declaration of David J. Smith
(“the Smith Declaration”), which documents Smith’s reproduction and testing—many
years after the relevant time frame for reduction to practice—of a tablet made according
to the McGregor Record of Invention. Board Decision at 22-23; see J.A. at 346-361.
According to the Smith Declaration, a tablet made according to the McGregor Record of
Invention possesses all the limitations of Count 2, including the relative dissolution rate
limitation. J.A. at 347 ¶ 9. Smith’s later recognition of this property of the dimple tablet
is irrelevant, however, to whether the inventors contemporaneously appreciated the
limitation at the time of the alleged reduction to practice. The Board appeared to
recognize as much, noting specifically that it “g[a]ve Mr. Smith’s testimony no weight as
to the question of whether the inventors’ [sic] conceived of this tablet property or
contemporaneously appreciated this property.” Board Decision at 57. Nevertheless,
the Board gave contradictory indications in the same discussion, noting that
appreciation of the comparative dissolution rate limitation was “confirmed by the
testimony of David Smith,” id., and “credit[ing] Smith’s testimony, for . . . it is consistent
with the contents of the [McGregor Record of Invention],” id. The Board’s inconsistent
and inappropriate treatment of the irrelevant Smith Declaration in this highly fact specific
case is not helpful. That fact notwithstanding, the Board’s error is harmless given the
Board’s explicit disavowal of any reliance upon it. It is clear that what was determinative
at the Board was its interpretation of the Metzger-Groom Report as being corroborative
of McGregor’s testimony.

2008-1447 5
additive is poured and allowed to harden. J.A. 322. The parties do not dispute that the

McGregor Record of Invention describes a detergent tablet including all limitations of

the count except for the limitation relating to comparative dissolution rates. Although

that limitation is absent from the McGregor Record of Invention, McGregor subsequently

testified that he appreciated, no later than February 14, 1997, that the compressed

region of the tablet dissolved more quickly than the non-compressed region. Board

Decision at 14; J.A. 387 ¶ 4. The Metzger-Groom Report documents the preparation

and testing of the tablet discussed in the McGregor Record of Invention. In the course

of discussing the test results, Metzger-Groom states that “the performance of dimple

tablets is slightly worse than that of regular tablets,” noting that the loss of performance

could be a result of “slower release of NB-base from the dimple vs. regular tablets.”

J.A. 371.

The Board read this last statement—i.e., “slower release of NB-base from the

dimple vs. regular tablets”—as an appreciation that the compressed region (i.e., the

“regular” region) of the dimple tablet dissolved at a faster rate than the non-compressed

region (i.e., the “dimple” region). Consequently, the Board concluded that it

corroborated McGregor’s testimony that he appreciated the comparative dissolution

rates. See Board Decision at 61-62 (“We credit McGregor’s testimony regarding

appreciation as it is sufficiently corroborated by, and consistent with, the evidence of

record. For example, Metzger-Groom’s monthly report identifies the tested tablets as

successfully removing carotenoid stains and as having a slower dissolution rate for the

noncompressed region (dimple) as opposed to the compressed region.”).

2008-1447 6
 P&G argues that the Board’s interpretation of the Metzger-Groom Report is

correct and that the Board did not err in awarding priority to P&G. Henkel counters,

however, with its own interpretation of this evidence. According to Henkel, the

statement under examination does not reveal an appreciation of differential dissolution

rates of the compressed and non-compressed regions of the same tablet, but instead

“implies a potentially slower release of the untablettable active ingredient from the

dimple inert carrier than the release of the same active ingredient tabletted in a regular

tablet, i.e., a single-region tablet.” Henkel’s Opening Br. at 11. Henkel therefore

contends that the Board erred by awarding priority to P&G.

The interpretation of the critical portion of the Metzger-Groom Report is a very

close call, and can reasonably go either way. But our inquiry in this case is not how we

would interpret this statement in the Metzger-Groom Report were we to do so in the first

instance. Rather, our task is to determine whether the Board’s interpretation is

supported by substantial evidence. We conclude that it is. In light of the focus of the

Metzger-Groom Report on testing the two-region dimple tablet conceived in the

McGregor Record of Invention, as well as the numerous references in the report to

dissolution rates in general, e.g., J.A. 371 (noting goal of concept was to “improve

stability and rate of delivery” of cleaning agents (emphasis added)), we find the Board’s

interpretation—that this statement demonstrates an appreciation that the dissolution

rate of the dimple, or non-compressed region of the tablet, was slower than the

“regular,” or compressed region of the tablet—reasonable. Thus, even if we were to

assume for the sake of this appeal that Henkel’s interpretation of the Metzger-Groom

Report is also reasonable, the substantial evidence standard of review compels

2008-1447 7
affirmance of the Board’s interpretation. See Guise v. Dep’t of Justice, 330 F.3d 1376,

1381 (Fed. Cir. 2003) (finding Merit System Protection Board’s interpretation of

evidence supported by substantial evidence where the interpretation was reasonable);

see also NLRB v. Augusta Bakery Corp., 957 F.2d 1467, 1473 (7th Cir. 1992) (“Where

two inferences are possible, we cannot substitute our own inference for that of the

Board, so long as the Board’s is supported by substantial evidence in the record as a

whole.”); Midland Transp. Co. v. NLRB, 962 F.2d 1323, 1326 (8th Cir. 1992) (“We may

not substitute our interpretation of the evidence for the Board’s reasonable inferences.”).

Because Henkel challenges only the Board’s interpretation of the Metzger-Groom

Report and not the Board’s conclusion of corroboration based on that interpretation, we

affirm the Board’s award of priority of invention to P&G.

III. CONCLUSION

The decision of the Board is AFFIRMED.

COSTS

No costs.

2008-1447 8