The Read Corporation and F.t. Read & Sons, Inc., Plaintiffs-appellees, v. Portec, Inc., D/b/a Portec/kolberg Division, Defendant-appellant, 970 F.2d 816 (Fed. Cir. 1992)

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U.S. Court of Appeals for the Federal Circuit - 970 F.2d 816 (Fed. Cir. 1992)

July 10, 1992.Rehearing Denied and Suggestionfor Rehearing In Banc DeclinedSept. 23, 1992

Jack R. Pirozzolo, Willcox, Pirozzolo & McCarthy, Boston, Mass., argued for plaintiffs-appellees. With him on the brief was Richard L. Binder. Also on the brief was Donald F. Parsons, Jr., Morris, Nichols, Arsht & Tunnell, of Wilmington, Delaware.

Donald R. Dunner, Finnegan, Henderson, Farabow, Garrett & Dunner, Washington, D.C., argued for defendant-appellant. With him on the brief was Barry W. Graham.

Before NIES, Chief Judge, ARCHER, and MICHEL, Circuit Judges.

NIES, Chief Judge.


Portec, Inc., appeals from the May 25, 1990, final judgment, entered upon a jury verdict, of the United States District Court for the District of Delaware, Civil Action No. 88-29-JRR, holding Portec liable for infringement of U.S. Patent No. 4,197,194 (the '194 patent) and U.S. Design Patent No. 263,836 (the '836 patent), and awarding The Read Corporation and F.T. Read & Sons, Inc. (collectively Read) treble damages and attorney fees. The district court's opinion denying Portec's motion for JNOV is reported at Read Corp. v. Portec, Inc., 748 F.Supp. 1078 (D.Del.1990). The district court's opinion granting Read's motion for treble damages and attorney fees is reported at Read Corp. v. Portec Inc., 17 USPQ2d 1243, 1990 WL 265979 (D.Del.1990). We affirm the judgment with respect to liability for infringement of the '194 patent, reverse the judgment with respect to liability for infringement of the '836 patent and the enhancement of damages, vacate the award with respect to attorney fees, and remand for modification of the injunction and reconsideration of the award of Read's attorney fees in light of this opinion.




James L. Read is the president of Read and the named inventor in both the '194 and '836 patents. The '194 patent is directed to a portable loam screening apparatus for separating fine earth material from coarser materials. The '836 patent is directed to an ornamental design of such a screening apparatus. Below are figures from each of the patents:




Read pointed out differences not only respecting the wheels, including that they were not collapsible and were in a different location (on the side, not the end) but also marked differences in other parts of the structure. Thus, any estoppel created by Portec's argument encompasses all of these combined distinctions of Deister and not an estoppel respecting each of the individual differences, e.g., that any device with non-movable wheels cannot infringe.4 That feature in itself was never asserted to be the basis for patentability over Deister. Thus, there is no basis for an assertion that Read is seeking to recapture anything which was surrendered to obtain the patent, the essence of the prosecution history estoppel. Vaupel Textilmaschinen KG v. Meccanica Euro Italia S.P.A., 944 F.2d 870, 882, 20 USPQ2d 1045, 1054 (Fed.Cir.1991).


In sum, nowhere in the prosecution history does Read limit its claims so as not to extend to equivalents of the movable wheels limitation.


Inasmuch as all but one of the limitations of the asserted claims is met literally, and that one is met equivalently, the accused structures satisfy the "same way" requirement of Graver Tank. See Laitram Corp. v. Rexnord, Inc., 939 F.2d 1533, 1539, 19 USPQ2d 1367, 1372 (Fed.Cir.1991). No argument is made that the Portec device does not perform the same overall work to achieve the same overall result. The denial of the motion for JNOV to overturn the verdict of infringement of the '194 patent must be affirmed.


Portec asserts that the district court erred in denying JNOV on the issues of validity and infringement of the '836 patent. Having reviewed the evidence of record, we agree with Portec that substantial evidence does not support the jury's verdict of infringement under the correct legal standard for infringement of a design patent.


The patent statute in 35 U.S.C. § 171 provides for patentability of "new, original and ornamental designs." The nonornamentality or functionality of the parts of a device does not necessarily preclude patentability of the overall design. Avia Group Int'l, Inc. v. L.A. Gear California, Inc., 853 F.2d 1557, 1563, 7 USPQ2d 1548, 1553 (Fed.Cir.1988). Nevertheless, in that case, "it is the non-functional, design aspects that are pertinent to determinations of infringement." Lee v. Dayton-Hudson Corp., 838 F.2d 1186, 1188, 5 USPQ2d 1625, 1627 (Fed.Cir.1988) (footnote omitted).


Portec argues that Mr. Read admitted that the design of the device was functional except for the shape of the fenders, that Read submitted no evidence comparing ornamental features, that the only features in common are functional, and, thus, infringement was not proved. Read counters that the testimony of its witness, Mr. Read,5 and the Portec device which was observed by the jury constitute substantial evidence sufficient to support the verdict under the standard set out in Gorham Co. v. White, 81 U.S. (14 Wall.) 511, 528, 20 L.Ed. 731 (1872), namely that:


[I]f, in the eye of an ordinary observer, giving such attention as a purchaser usually gives, two designs are substantially the same, if the resemblance is such as to deceive such an observer, inducing him to purchase on supposing it to be the other, the first one patented is infringed by the other.


Read misperceives the holding of Gorham. Gorham sets forth the standard of infringement of an ornamental design. In Gorham, however, there was no preliminary issue respecting what the ornamental features of the design in issue were. The Gorham design patent claimed only the scroll work on the handle portion of table flatware. The tines or the bowl of the utensils did not appear in the patent. Thus, all elements forming the claimed design were ornamental. Where this is not the case, that is, a design is composed of functional as well as ornamental features, to prove infringement a patent owner must establish that an ordinary person would be deceived by reason of the common features in the claimed and accused designs which are ornamental. Lee, 838 F.2d at 1188, 5 USPQ2d at 1627.


Infringement of the '836 patent, thus, depends upon (1) the similarity of the ornamental features of the Portec device and the patented design, and (2) the likelihood that an ordinary person would be confused because of such ornamental similarity. A verdict for the plaintiff cannot stand where the plaintiff failed wholly to offer proof respecting an element of its cause of action. See Celotex Corp. v. Catrett, 477 U.S. 317, 323-25, 106 S.Ct. 2548, 2552-54, 91 L.Ed.2d 265 (1986) (summary judgment, like directed verdict, appropriate in the absence of proof of an essential element of plaintiff's case). Because Read failed to submit any evidence directed to either element of infringement, no substantial evidence supports the jury's finding that Portec infringed the '836 design patent.6 Thus, the court erred in denying Portec's motion for JNOV.


The verdict form of record shows that the amount of damages was attributed to infringement of the '194 patent; nothing was awarded for infringement of the '836 patent. Inasmuch as the quantum of damages prior to enhancement is not at issue, we need not remand for redetermination of damages. However, the injunction must be modified on remand.


Under section 284 of Title 35, damages may be enhanced up to three times the compensatory award. An award of enhanced damages for infringement, as well as the extent of the enhancement, is committed to the discretion of the trial court. While no statutory standard dictates the circumstances under which the district court may exercise its discretion, this court has approved such awards where the infringer acted in wanton disregard of the patentee's patent rights, that is, where the infringement is willful. Great Northern Corp. v. Davis Core & Pad Co., 782 F.2d 159, 166, 228 USPQ 356, 360 (Fed.Cir.1986). See also Mathis v. Spears, 857 F.2d 749, 754, 8 USPQ2d 1029, 1033 (Fed.Cir.1988) ("Provisions for increased damages ... are available as deterrents to blatant, blind, willful infringement of valid patents."). On the other hand, a finding of willful infringement does not mandate that damages be enhanced, much less mandate treble damages. Modine Mfg. Co. v. Allen Group, Inc., 917 F.2d 538, 543, 16 USPQ2d 1622, 1625 (Fed.Cir.1990), cert. denied, --- U.S. ----, 111 S.Ct. 2017, 114 L.Ed.2d 103 (1991).


The paramount determination in deciding to grant enhancement and the amount thereof is the egregiousness of the defendant's conduct based on all the facts and circumstances. See Rite-Hite Corp. v. Kelley Co., 819 F.2d 1120, 1125-24, 2 USPQ2d 1915, 1919 (Fed.Cir.1987). The court must consider factors that render defendant's conduct more culpable, as well as factors that are mitigating or ameliorating. Compare Ivac Corp. v. Terumo Corp., 18 USPQ2d 1637, 1639-40, 1990 WL 180202 (S.D.Cal.1990) (Treble damages are appropriate when it is clear that defendant showed no good faith at the time infringement commenced, made no effort to follow the advice of patent counsel or alter the infringing device, and showed bad faith in litigation.); with Datascope Corp. v. SMEC, Inc., 14 USPQ2d 1071, 1074, 1990 WL 10345 (D.N.J.1990) ("A fifty-percent enhancement of damages is appropriate here. Although SMEC's infringement was willful, it was not blatant."); and Chisum v. Brewco Sales & Mfg., 726 F.Supp. 1499, 13 USPQ2d 1657, 1668 (W.D.Ky.1989) ("The lost profits will however be doubled rather than tripled, since we find that Brewer's actions were willful, but not so egregious as to warrant trebling of the damages."). In Bott v. Four Star Corp., 807 F.2d 1567, 1572, 1 USPQ2d 1210, 1213 (Fed.Cir.1986), three factors were identified for consideration in determining when an infringer "acted in [such] bad faith as to merit an increase in damages awarded against him":(1) whether the infringer deliberately copied the ideas or design of another;7


(2) whether the infringer, when he knew of the other's patent protection, investigated the scope of the patent and formed a good-faith belief that it was invalid or that it was not infringed; and


(3) the infringer's behavior as a party to the litigation.


The Bott factors are not all inclusive. In addition, other circumstances which courts appropriately have considered, particularly in deciding on the extent of enhancement, are:


(4) Defendant's size and financial condition. St. Regis Paper Co. v. Winchester Carton Corp., 410 F.Supp. 1304, 1309, 189 USPQ 514, 518 (D.Mass.1976) ("[D]ouble damages [appropriate]. If defendant were the giant and plaintiff the small independent, I would make it treble...."); Bott v. Four Star Corp., 229 USPQ 241, 254 (E.D.Mich.1985) ("[a] threefold increase in damages would severely affect [defendant's] financial condition."), vacated and remanded for clarification of damage amount, 807, F.2d 1567, 1 USPQ2d 1210 (Fed.Cir.1986); Lightwave Technologies, Inc. v. Corning Glass Works, 19 USPQ2d 1838, 1849 (S.D.N.Y.1991) (Defendant "can withstand some increase in damages, but not treble damages."); Kori Corp. v. Wilco Marsh Buggies and Draglines, Inc., 561 F.Supp. 512, 533, 217 USPQ 1302, 1312 (E.D.La.1982) (Exemplary damages "should not unduly prejudice the defendants' non-infringing business."), aff'd, 761 F.2d 649, 225 USPQ 985 (Fed.Cir.), cert. denied, 474 U.S. 902 [106 S.Ct. 230, 88 L.Ed.2d 229] (1985).


(5) Closeness of the case. Modine Mfg. Co. v. The Allen Group, 917 F.2d at 543, 16 USPQ2d at 1626 (No abuse of discretion to award no enhanced damages on the ground that willfulness was "sufficiently close on the evidence."); Crucible, Inc. v. Stora Kopparbergs Bergslags AB, 701 F.Supp. 1157, 1164, 10 USPQ2d 1190, 1196 (W.D.Pa.1988) ("[B]ecause the court still considers the [willfulness] question to be a close one ... double, and not treble damages are appropriate.").


(6) Duration of defendant's misconduct. Bott v. Four Star Corp., 229 USPQ 241, 255 (E.D.Mich.1985) (For sales prior to the appellate court's affirmance of the liability judgment, damages increased by 20%; for sales after the affirmance, damages doubled.), vacated and remanded for clarification of damage amount, 807 F.2d 1567, 1 USPQ2d 1210 (Fed.Cir.1986).


(7) Remedial action by the defendant. Intra Corp. v. Hamar Laser Instruments, Inc., 662 F.Supp. 1420, 1439, 4 USPQ2d 1337, 1351 (E.D.Mich.1987) (Damages only doubled because defendant "voluntarily ceased manufacture and sale of infringing systems during the pendency of this litigation...."), aff'd without opinion, 862 F.2d 320 (Fed.Cir.1988), cert. denied, 490 U.S. 1021 [109 S.Ct. 1746, 104 L.Ed.2d 183] (1989).


(8) Defendant's motivation for harm. American Safety Table Co. v. Schreiber, 415 F.2d 373, 379, 163 USPQ 129, 133 (2d Cir.1969) ("[D]efendants' infringing acts, although deliberate and with knowledge of plaintiff's rights, could not be termed pernicious due to prevailing 'economic pressure in the form of customer dissatisfaction.' "), cert. denied, 396 U.S. 1038 [90 S.Ct. 683, 24 L.Ed.2d 682] (1970).


(9) Whether defendant attempted to conceal its misconduct. Russell Box Co. v. Grant Paper Box Co., 203 F.2d 177, 183, 97 USPQ 19, 23 (1st Cir.) (Enhanced damages supported in part by findings "that the defendant had failed to preserve its records and had failed to cooperate as it should at the trial on the issue of damages."), cert. denied, 346 U.S. 821 [74 S.Ct. 37, 98 L.Ed. 347] (1953).


Use of these factors in patent cases is in line with punitive damage considerations in other tort contexts.8


Inasmuch as a finding of willful infringement does not mandate enhancement of damages, the above factors taken together assist the trial court in evaluating the degree of the infringer's culpability and in determining whether to exercise its discretion to award enhanced damages and how much the damages should be increased. To enable appellate review, a district court is obligated to explain the basis for the award, particularly where the maximum amount is imposed. For the latter, the court's assessment of the level of culpability must be high. 5 Donald S. Chisum, Patents § 20.03[b][vi] (1991).


In its award of enhanced damages, the district court here relied on Portec's "copying," the willful nature of Portec's infringement, and Portec's "manipulative" litigation strategy, which the court said was "reflective of the dubiousness of Portec's assertions that it produced its devices with a good faith belief in the innocence of its action." 17 USPQ2d at 1247.


Throughout its brief to this court, Read stresses Portec's "copying" of the Read Screen-All as evidence of willful and wanton infringement. The district court also characterized Portec's activity as "copying," and criticized Portec heavily for doing so. Such a characterization is unwarranted. Certainly the Read Screen-All served as the starting point for Portec's design efforts. And certainly the purpose of Portec's efforts was to make a device which would compete with the Read Screen-All. However, the undisputed evidence of record shows that Portec made specific changes deemed adequate by counsel to avoid infringement of both of Read's patents. We have often noted that one of the benefits of the patent system is the incentive it provides for "designing around" patented inventions, thus creating new innovations. See Slimfold Mfg. Co. v. Kinkead Indus., Inc., 932 F.2d 1453, 1457, 18 USPQ2d 1842, 1845-46 (Fed.Cir.1991); State Indus., Inc. v. A.O. Smith Corp., 751 F.2d 1226, 1235-36, 224 USPQ 418, 424 (Fed.Cir.1985).


Of course, determining when a patented device has been "designed around" enough to avoid infringement is a difficult determination to make. One cannot know for certain that changes are sufficient to avoid infringement until a judge or a jury has made that determination. In the present case, the jury found that the changes made by Portec were not sufficient to avoid infringement of either patent, and we have herein reversed the judgment respecting infringement of the '836 patent and affirmed the judgment respecting infringement of the '194 patent. Portec is thus liable for damages caused by its miscalculation respecting infringement of the '194 patent. The question which must first be answered here with respect to enhanced damages is whether Portec proceeded without a reasonable belief that it would not be held liable for infringement.


Willfulness is a determination as to a state of mind. One who has actual notice of another's patent rights has an affirmative duty to respect those rights. Rolls-Royce, Ltd. v. GTE Valeron Corp., 800 F.2d 1101, 1109, 231 USPQ 185, 191 (Fed.Cir.1986). That affirmative duty normally entails obtaining advice of legal counsel although the absence of such advice does not mandate a finding of willfulness. See Kloster Speedsteel AB v. Crucible, Inc., 793 F.2d 1565, 1579, 230 USPQ 81, 91 (Fed.Cir.1986) ("Though it is an important consideration, not every failure to seek an opinion of competent counsel will mandate an ultimate finding of willfulness."), cert. denied, 479 U.S. 1034, 107 S.Ct. 882, 93 L.Ed.2d 836 (1987). Those cases where willful infringement is found despite the presence of an opinion of counsel generally involve situations where opinion of counsel was either ignored or found to be incompetent. See Datascope Corp. v. SMEC, Inc., 879 F.2d 820, 828-29, 11 USPQ2d 1321, 1326-27 (Fed.Cir.1989), cert. denied, 493 U.S. 1024, 110 S.Ct. 729, 107 L.Ed.2d 747 (1990); Kori Corp. v. Wilco Marsh Buggies & Draglines, Inc., 761 F.2d 649, 656-57, 225 USPQ 985, 989 (Fed.Cir.), cert. denied, 474 U.S. 902, 106 S.Ct. 230, 88 L.Ed.2d 229 (1985). This precedent does not mean a client must itself be able to evaluate the legal competence of its attorney's advice to avoid a finding of willfulness. The client would not need the attorney's advice at all in that event. That an opinion is "incompetent" must be shown by objective evidence. For example, an attorney may not have looked into the necessary facts, and, thus, there would be no foundation for his opinion. Datascope, 879 F.2d at 828-29, 11 USPQ2d at 1326-27. A written opinion may be incompetent on its face by reason of its containing merely conclusory statements without discussion of facts or obviously presenting only a superficial or off-the-cuff analysis. Underwater Devices, Inc. v. Morrison-Knudsen Co., 717 F.2d 1380, 1390, 219 USPQ 569, 577 (Fed.Cir.1983).


In the present case, Portec obtained at least two independent written detailed opinions of unrelated patent counsel and engaged in numerous conferences with its lawyers on the matter. The defenses put forth by Portec in this suit track defenses set forth in these opinions and required full trial, which supports their good faith.9 Despite these facts, the jury found that Portec had willfully infringed both the '194 and the '836 patents. The district court, in its opinion granting Read's motion for treble damages and attorney fees, discussed at length Portec's conduct relating to the willfulness issue. Reviewing the "evidence" which the district court relied on as allegedly showing the willfulness of Portec's conduct, as well as other evidence cited by Read in support of the jury verdict, we can only conclude that the jury's finding of willfulness is not supported by substantial evidence. No reasonable juror could find the asserted proof of willfulness rose to the quantum of clear and convincing evidence.


The district court indicated that Portec failed to heed the advice of its counsel. In support of this contention, the district court cites the January 1985 opinion of Groff as advising Portec that he "doubted" whether a device sufficiently modified to avoid infringement would be "as efficient and commercially appealing." This appears to be a misunderstanding of Groff's opinion. Groff stated unequivocally the patents "could be circumvented," but said it was questionable whether a device modified to avoid infringement would be as efficient or commercially appealing. However, the fact is that at the time Groff rendered his opinion, Portec had not yet begun design of any device, and thus Groff had no idea whether Portec could design a commercially acceptable device that avoided infringement.


The district court criticized the opinion of Valiquet because Valiquet admitted at trial that he performed no specific legal research prior to rendering the opinion. The district court was also of the view that Valiquet's opinion was incompetent because it failed to discuss infringement under the doctrine of equivalents. Further, the district court criticized Portec for not giving Groff's opinion to Valiquet.


None of these criticisms are justified. Valiquet was a patent attorney with many years of experience. Failure to perform legal research on the basic concepts of literal infringement, the doctrine of equivalents, and prosecution history estoppel does not per se make the opinion of a lawyer who specializes in patents incompetent.


Moreover, the district court was incorrect when it stated that Valiquet did not consider the doctrine of equivalents. Valiquet's opinion included the following:


During prosecution before the U.S. patent office, Read was required by the patent office to add the limitation to his claims that the short end extends to the ground. Also, Read voluntarily added to his patent claims the concept of moving the frame so that is could be flush on the ground through use of movable wheels. Since these distinctions were added in view of prior art cited by the Examiner, Read cannot argue that Portec has any type of equivalent structure. [Emphasis added.]


The district court maintained that this portion of Valiquet's opinion was directed solely to the question of literal infringement. We disagree. The substance of this analysis with its reference to "prior art" and "equivalent structure" can only relate to infringement under the doctrine of equivalents.


Further, the failure to give the first lawyer's opinion to Valiquet is a plus, not a minus. Valiquet was not influenced thereby and was able to make his own independent evaluation.


The most important consideration, however, is that nothing in Valiquet's letter would alert a client to reject the letter as an obviously bad opinion. Indeed, his opinion on infringement of the '836 patent was on the mark. More importantly, the opinion was detailed not merely conclusory. On finalization of the drawings, Valiquet reviewed the matters again. Portec sought professional advice on making a competing device which avoided the patent. The monetary exposure of his client required no less from Valiquet than the soundest advice he could offer, not merely to avoid enhanced damages, but all damages. Counsel's opinion, in effect, has been treated inappropriately and unfairly as part of a scheme to avoid enhanced damages only.


Finally, the district court criticized Valiquet's September 25, 1987, opinion, because it was allegedly inconsistent with an "opinion" given in February of 1987. Specifically, the district court noted that in February, Valiquet and Dahlinger of Portec were discussing the use of a "completely" open short end to avoid infringement. In contrast, the September 25, 1987, opinion letter concluded that a device with only about a six-inch opening on the short end avoided infringement.


In February of 1987, Portec had developed no specific designs for a device. Whatever discussions Valiquet had with Dahlinger in February of 1987 can hardly be characterized as an "opinion" on the structure in issue; hand-written notes made during the discussions merely describe general avenues by which the '194 patent could be avoided. In fact, those notes describe other possibilities for avoiding infringement of the '194 patent, such as the use of a horizontal shaker screen. The fact that Portec later designed a device which incorporated some, but not all, of the design modifications first discussed by Valiquet and Dahlinger, and that Valiquet concluded that the resulting device was not an infringement, does not render his final opinion inconsistent.


In sum, upon review of the record before us, we hold that there is insufficient evidence from which a reasonable jury could find that Portec's infringement was willful. Inasmuch as there is no infringement of the '836 patent, a finding of willful infringement with respect to that patent necessarily drops out of the case. That counsel's opinion turned out to be contrary to our judgment with respect to the '194 patent does not make his advice regarding that patent incompetent. Read cannot point to any substantial evidence which indicates that Portec did not have a good faith belief that it was not infringing, because it had successfully "designed around" the '194 patent. Thus, the factors of willful infringement and copying are not present.


The district court also relied upon instances of what it characterized as Portec's improper litigation strategy which the court stated demonstrated Portec's lack of a good faith belief in its defenses. Absent willful infringement, however, there is no basis in this case for enhanced damages. As indicated, bad faith behavior as a party to the litigation is a factor to be weighed in assessing the level of a defendant's culpability where an infringement is found willful. While dicta suggest that infringement damages may be enhanced solely by reason of misconduct during litigation,10 such dictum is contrary to our precedent that "[i]f infringement [is] ... innocent, increased damages are not awardable for the infringement." Kloster Speedsteel, 793 F.2d at 1580, 230 USPQ at 91. Thus, applying Kloster Speedsteel to this case, we reverse the award of enhanced damages.


With respect to making its award of attorney fees under 35 U.S.C. § 285, the district court again relied on the willfulness of Portec's infringement to find the case was exceptional. Thus, this award cannot stand. However, litigation misconduct may in itself make a case "exceptional." Kloster Speedsteel, 793 F.2d at 1580-81, 230 USPQ at 91; Rohm & Haas Co. v. Crystal Chem. Co., 736 F.2d 688, 691-92, 222 USPQ 97, 99 (Fed.Cir.1984). The district court found misconduct first by reason of Portec's creation, during litigation, of what the district court termed as an "aberrant model" of its device in order to avoid infringement of the '836 design patent. Even had we not reversed the finding of infringement of the '836 patent, this basis for enhancement would be meritless. Although Portec already had an opinion of noninfringement from its counsel on the device in suit, Portec made further design changes in its device in order to make sure that it had a noninfringing device. Such a "litigation strategy" should be encouraged, not viewed as misconduct. See State Indus., 751 F.2d at 1235-36, 224 USPQ at 424.


The second example concerned a screening device referred to at trial as the "Hoehn device." Portec introduced evidence of the Hoehn device, in an attempt to show that the claims of the '194 patent were invalid, including two spatially-consecutive photographs showing the Hoehn device. Read discovered that part of the first photograph had been covered by the second photograph so that it could not be seen that the device in the first photograph had no hitch. The missing hitch seriously undermined the testimony which had already been presented by Portec concerning the chronology of the development of the Hoehn device. Portec asked the district court to allow it to present surrebuttal evidence to explain the absence of the hitch, but the district court denied its request, explaining that Portec should have presented this evidence in its case in chief.


We cannot say that the district court abused its discretion in not allowing Portec to present additional evidence to explain away the missing hitch on the Hoehn exhibit in connection with the issue of validity. On the other hand, where the question is improper conduct to support an award of attorney fees, we conclude that the evidence must be considered by the court before finding misconduct and that the finding that this incident constituted improper litigation strategy cannot stand. Accordingly, we remand for a re-determination by the district court whether Portec did engage in litigation misconduct and, if so, whether it was sufficiently culpable as to make the case exceptional. We point out that, when attorney fees under 35 U.S.C. § 285 are awarded solely on the basis of litigation misconduct, the amount of the award must bear some relation to the extent of the misconduct. See Beckman Instruments, 892 F.2d at 1553-54, 13 USPQ2d at 1306-07.




The judgment with respect to liability for infringement of the '194 patent is affirmed. The judgment with respect to liability for infringement of the '836 patent and enhanced damages is reversed. The award of attorney fees is vacated and the case is remanded for modification of the injunction and for reconsideration of the award of attorney fees in light of this opinion.




Each party to bear its own costs.






Portec's original device




Portec's modified device


The only difference between claims 2 and 7 is the additional requirement in claim 7 of "a table" within the frame. Since this additional limitation is irrelevant to the issues in this case, we will limit our discussion to claim 2 only


See Jamesbury Corp. v. Litton Indus. Prods., Inc., 756 F.2d 1556, 1564-65, 225 USPQ 253, 259-60 (Fed.Cir.1985) ("[district] court should instruct the jury on what the claim means"); Structural Rubber Prods. Co. v. Park Rubber Co., 749 F.2d 707, 721, 223 USPQ 1264, 1275 (Fed.Cir.1984) ("claim interpretation [is] matter for the court to decide and to make known to the jury by its instructions"). But see Tol-O-Matic, Inc. v. Proma Produkt-Und Marketing Gesellschaft M.b.H., 945 F.2d 1546, 20 USPQ2d 1332 (Fed.Cir.1991). We endorse the earlier precedent


Acceptance of Portec's argument respecting estoppel for each item in a patentee's list of distinctions between the invention and a prior art reference would mean that the less material a prior art reference, the more the estoppel merely by a patentee's pointing out numerous differences. This turns an equitable doctrine into an illogical mechanical rule and would allow easily distinguishable prior art, here Deister, to emasculate the doctrine of equivalents


The testimony of Mr. Read, respecting infringement consists of the following:

Counsel for Read: In the eye of an ordinary observer, giving such attention as a purchaser usually gives, is the resemblance of [Portec's device] to the design disclosed in your '836 design patent such as to cause or induce such an observer to purchase [Portec's device] thinking it to be the design disclosed in your design patent?

Mr. Read: Yes.


Portec's arguments do not require us to address the denial of its motion for JNOV respecting the issue of validity of the patent after a finding of noninfringement


"Ideas" and "design" would encompass, for example, copying the commercial embodiment, not merely the elements of a patent claim


See, e.g., the recent case of Hodges v. S.C. Toof & Co., 833 S.W.2d 896, 900-01 (Tenn.1992), where the court stated that, in determining the amount of a punitive damage award, the factfinder should consider, among other factors: defendant's size and financial condition; the reprehensibility of defendant's conduct; the duration of defendant's misconduct; whether defendant attempted to conceal his misconduct; whether defendant had been punitively sanctioned previously for the same acts; and defendant's motivation for harm


An opinion of counsel, of course, need not unequivocally state that the client will not be held liable for infringement. An honest opinion is more likely to speak of probabilities than certainties. A good test that the advice given is genuine and not merely self-serving is whether the asserted defenses are backed up with viable proof during trial which raises substantial questions, as here


State Indus., Inc. v. Mor-Flo Indus., Inc., 948 F.2d 1573, 1577, 20 USPQ2d 1738, 1741 (Fed.Cir.1991); Beatrice Foods Co. v. New England Printing and Lithographing Co., 923 F.2d 1576, 1578-79, 17 USPQ2d 1553, 1555-56 (Fed.Cir.1991). We note, in this connection, that other sanctions are generally available for litigation misconduct. See, e.g., Beckman Instruments, Inc. v. LKB Produkter AB, 892 F.2d 1547, 1553-54, 13 USPQ2d 1301, 1306-07 (Fed.Cir.1989); 28 U.S.C. 1927