By Brian Craig, J.D.
Jury will decide whether indirect infringement took place; factual issues existed on the requisite intent and knowledge.
In an infringement case between two competing hardware companies, over a drawer release system, the federal district court in Milwaukee has concluded that defendant Allegis Corporation directly infringed two patents owned by Austin Hardware & Supply Inc., but will let a jury decide indirect infringement. In granting partial summary judgment, the court concluded that the evidence of direct infringement is overwhelmingly in Austin’s favor based on the claim construction. The court determined, however, that a jury must decide the issue of indirect infringement by induced infringement and contributory infringement because the evidence shows Allegis attempted to seek counsel from a patent attorney in order to avoid infringement and attempted to change its product to avoid infringement (Austin Hardware & Supply Inc., v. Allegis Corp.,September 29, 2020,Stadtmueller, J.).
Austin Hardware & Supply Inc. owns two patents for a drawer release mechanism: U.S. Patent No. 10,004,331 patent (the ’331 Patent) and U.S. Patent No. 10,455,937 (the ’937 Patent). The drawer release system allows users to open a drawer, lock it into place, unlock it, and close it—all with one hand. Austin brought suit against Allegis Corporation, alleging infringement of the two patents. The parties filed cross-motions for summary judgment.
Claim construction. The court first construed the meaning of certain language in the patent claims. The court concluded that "spring assembly" means "a spring that assembles the handle portion into a closed position." The court also adopted Austin’s term for "lever engaging member" to mean "structure that engages a lever, actuator, or trigger."
Direct infringement. Based on the claim construction, the court found that the evidence of direct infringement is overwhelmingly in Austin’s favor. While Allegis claimed that its device does not include a drawer slide, there is no evidence in the record suggesting it can be used without a drawer slide. As a practical matter, the accused device requires a drawer slide, and therefore comprises a drawer slide. The court found that Allegis’s argument is a "needlessly tortured reading" of one claim. The handle moves the drawer open. The handle moves the drawer closed. The handle, which is connected to the drawer, thus moves between open and closed positions. Therefore, the court found that the accused product directly infringements the claims for both patents and granted summary judgement in favor of Auston on that issue.
Indirect infringement. The court concluded that a jury must decide whether Allegis indirectly infringed the patents by induced infringement and contributory infringement. To establish induced infringement, the patent holder must prove that once the defendants knew of the patent, the defendants actively and knowingly aided and abetted another’s direct infringement. Here, the deposition testimony from Allegis’s employees suggests that it was conscious that there was a risk of infringing the patents. This is not, however, evidence that Allegis actively and knowingly aided in infringing a patent by instructing others to infringe. To the contrary, there is deposition testimony from Allegis’s patent attorney that Allegis thoroughly conferred with him specifically to avoid infringement. Allegis contacted Austin’s patent attorney several times and made design changes in order to avoid infringement. This creates a genuine issue of material fact as to whether Allegis had the requisite intent to infringe. Therefore, the issue of whether Allegis induced infringement must be left for the jury to decide.
As to contributory infringement, while there is evidence Allegis knew of the ’331 Patent and the ’937 Patent, Allegis’s demonstrated attempts to seek counsel from a patent attorney in order to avoid infringement, as well as Allegis’s attempts to change its product to avoid infringement. This raises a question of intent for the jury to answer. Therefore, the court denied the motion for summary judgment on indirect infringement.
Inequitable conduct. The court granted summary judgment in favor of Austin on the defense of inequitable conduct. Allegis argued that Austin failed to disclose a material prior art during the patent application process. The court could infer that a lengthy patent application process, absent more, gives rise to an intent to deceive during the application process. No reasonable jury could reach such a conclusion on facts. Therefore, the court dismissed the inequitable conduct defense.
Validity of patents. Finally, the court upheld the validity of the patents over arguments based on indefiniteness, nonsensicality, and obviousness. Based on the court’s claim construction, the court granted summary judgment in favor of Austin on the issue of definiteness. The court acknowledged that while the first element may raise confusion—it does not rob the claim of clarity such that it fails to inform, with reasonable certainty, those skilled in the art about the scope of the invention.
The also court rejected the argument that the ’937 Patent is invalid based on a nonsensicality theory. The court concluded that a drawer slide is a required part of the whole assembly, and the claim is not rendered nonsensical for its inclusion. The court found that Allegis’s argument on nonsensicality invites "nonsensical logic."
The court also rejected the obviousness argument asserted by Allegis. The court found that Allegis failed to meet its burden to provide clear and convincing evidence that the patents are obvious based on the prior art. The court could not genuine issue of material fact where a party relies solely on the same prior art considered by the PTO.
Therefore, the court upheld the validity of both patents and granted summary judgement in favor of Austin on those issues.
This case is No. 2:19-cv-00785-JPS.
Attorneys: Thomas L. Gemmell (Polsinelli PC) for Austin Hardware & Supply, Inc. Randall Thomas Skaar (Skaar Ulbrich Macari, P.A.) for Allegis Corp
Companies: Austin Hardware & Supply, Inc.; Allegis Corp.
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