## United States Court of Appeals for the Federal Circuit

05-1337

PANDUIT CORPORATION, Plaintiff-Appellant,

v.

HELLERMANNTYTON CORPORATION, Defendant-Appellee.

Richard E. Rice , Oliff & Berridge, PLC, of Alexa ndria, Virginia, argued for plaintiffappellant. With him on the brief were James A. Oliff , Eric W. Schweibenz , and Vu Q. Bui . Of counsel on the brief were Patrick G. Burns , Greer, Burns & Crain, Ltd., of Chicago, Illinois, and Robert A. McCann , Panduit Corporation, of Tinley Park, Illinois. Joseph A. Kromholz , Ryan, Kromholz & Manion, S.C., of Milwaukee, Wisconsin, argued for defendant-appellee. Wi th him on the brief was Daniel R. Johnson

. Appealed from: United States District C ourt for the Northern District of Illinois Senior Judge Harry D. Leinenweber

## United States Court of Appeals for the Federal Circuit

05-1337

PANDUIT CORPORATION, Plaintiff-Appellant,

v.

HELLERMANNTYTON CORPORATION, Defendant-Appellee.

__________________________ DECIDED: June 12, 2006

_______________ ___________ Before MICHEL, Chief Judge , GAJARSA, and LINN, Circuit Judges

. LINN, Circuit Judge

. Panduit Corporation (“Panduit”) appeals from a final order dismissing its claims with prejudice after the district cour t granted HellermannTyt on Corporation’s (“HellermannTyton”) motion for summary judgment that He llermannTyton did not breach provisions of the Settlement Agreement that ended a prior infringement suit involving U.S Patent No. 5,998, 732 (“the ’732 patent”). See Panduit Corp. v. HellermannTyton Corp. , No. 03 C 8100 (N.D. Ill. Mar. 22, 2005) (final order); Panduit Corp. v. HellermannTyton Corp. , No. 03 C 8100 (N.D. Ill. Feb. 9, 2005) (summary judgment). Because no genuine issue of material fact exists and HellermannT yton is entitled to judgment as a matter of law, we affirm.I. BACKGROUND The ’732 patent inv o lves a “modular of fset power bo x and communication
extens ion” for a “multi-channel power and c o mmunication wiring and raceway system.” Multi-channel wiring raceway s ystems are commonly used whe n installing power and communications conductors within the same duct running throughout the walls of an office building. Raceway systems help provide work spac es with power outlets and phone lines to run equipm ent lik e computers, fax mac h ines, phones, and printers. The present invention facilitates adjustment wit hin the raceway system to add or re move outlets or wiring at a given wor k space as desired. In prior a r t raceway systems, adjustments to accommodate c hanges in business needs or technology were diffic u lt and time consuming. One advantage of the raceway s ystem discl osed in the ’732 pat ent is to allow power conductors disposed in the raceway to be quick ly and eas ily routed into a power box 12 while keeping the pow er conductors isolated from the communication channel 18. This s ystem of routing avoids interfer ence and helps speed installation. A v i ew of this system is shown in Figure 2 of the ’732 patent, reproduced below.

05-1337 2The system is recited in clai m 1, which is repr esentative of the claims on appeal. At issue are the structural limit ations of t he offset power box, which are highlighted below. 1. A modular raceway outlet station for use with a trunking duct which has a divider wall and a top access opening comprising: an offset power box having, a projection extending late rally from a top wall of the offset power box having a t op portion and an abut ment portion depending from a furthest extent of the top po rtion adapted to be disp osed substantially aligned with an adjacent edge of the top access opening; and an opening formed in the abutment porti on of the projection is in communication with an aperture form ed in a side wall of the offs et power box adjacent the duct ; and a communication extension adapted to be disposed over the duct top access opening hav ing, an abutment surface dependin g from a top surface of the extension adapted to be dis pos ed flush agains t the abutment portion of the projection; a routing notch formed in the abutment surface and a guide wall depending from the extens ion interiorly adjacent the routing notch, adapted to be substantially ve rtically aligned with a div i der wall, wherein power conductors may be routed out of and over the duct, through the routing notch, and opening, and into the offset power box before installation of the ex tension, such that the power

05-1337 3conductors are isolated from communication conductors when the extens ion is installed. ’732 patent , col. 7, ll. 14 -41 (emphasis added). The preferred embodiment depicts the offset power box 12 with a top wall 38, a pair of s i dewalls 40, a pair of end walls 42, a pair of interior end walls 43, an interior sidewall 41 opposite the duct 18 and a bottom wa ll 44. The interior of the box 46 accommodates the installation of a power outlet 50. Projecti on 66 laterally extends from the box 12 toward the trunking duct 18. T he “abutment portion ” 74 vertically depends from the furthest lateral extent of the “top portion” 68 such that it is s ubstantially vertically aligned with the adjacent edge 29 of the duc t top access opening 28. The opening in the side wall, or “aperture” as the claim recites, abuts the trunking duct when the box is in place and, along with the opening in the abut ment portion, allows the electrical wires to pas s out of the box and into the duct, as se en in Figure 4 of the ’732 patent, reproduced below.

FIG. 4

05-1337 4In 2001, Panduit filed suit against Hell ermannTyton a lleging infringement of the ’732 patent in view of a power bo x that Helle rmannTyton was then sellin g lab e led “Part No. MCR- SEB,” dep icted in the drawin g figur e be low and referred to as the “previous design.” Shortly thereafter, the parti es entered into a Settlement Agreement (“Agreement”) to end the litigatio n, whereby Hellerman n Tyton agr eed not to make or sell “Subject Products.” The Agreement defined “S ubject Products” in ¶ 1(b)(i) as “the HellermannTyton Multi-Channe l Raceway Side Electr ic Bo x (HellermannTyton Part No. MCR-SEB) ” and in ¶ 1(b)(ii) as “all products, existing now or in t he future, covered by any claim of the Panduit Patent.” In exchange, Panduit waiv ed its claims against HellermannTyton for infringement of the ’732 patent prior to the date of the Agreement.

In 2003, Panduit filed suit against Helle rmannTyton for breach of ¶ 1(b)(i) and ¶ 1(b)(ii) of the Agreement and for in fringement of the ’7 32 patent based on HellermannTyton’s sale of the product depicted in the drawing below and designated as the “revised design.” The only difference between the previous design and the revised

05-1337 5design is that the wall abutting the trunking duc t in the revised design is so lid with no cutaway.

In February 2004, the district court stay ed litigation of the infringement claim pending the outcome of a reex amination proceeding at the United States Patent and Trademark Office. However, the district court allowed the breach of contract claim t o proceed. On August 10, 2004, the district court construed seve ral limitations of claim 1, including the phrases “a projection extending laterally from a t op wall of the offset power box” (the “projection” limitation); “a projection . . . having . . . an abutment portion depending from a furthest extent of the top portion adapted to be disposed s ubstantially aligned with an adjacent edge of the to p access opening” (the “abutment portion” limitation); “an opening formed in the abut ment portion of the projection” (the “open i ng” limitation); and “an aperture formed in a side wall of the offset power box” (the “aperture formed in a side wall” limitation). On February 9, 2005, the distri ct court issued an o r der granting HellermannTyton’s motion for summary judgm ent on the contract claim. First, the

05-1337 6district court ruled as a matter of law that the accused device was not the same as the previous design and thus was not covered by ¶ (1)(b)(i) of the Agreement, dismissing Panduit’s argument that the accused device wa s the same “in all material respects” as the 2001 device. Sec ond, the di strict court ruled as a matte r of l a w that the accus ed device did not infringe t he ’732 patent either literally or under the do ctrine of equiva lents and thus did not breach ¶ (1)(b)( ii) of the Agreement. The di stric t court found that the accused device was missing t he “project ion,” “abutment porti on,” and “opening” limitations. Although briefed to the district court by both parties, the court did not address the issue of whether t he “aperture formed in a side wall” limitation read on the accused device. The district court then enter ed a final order dis posing of all remaining claims. Panduit timely appealed. We have ju risdiction under 28 U.S.C. § 1295(a)(1). On appeal, Panduit challenges t he distri ct court’s grant of summary judgment that HellermannTyton did not breach either ¶ (1)(b )(i) or ¶ (1)(b)(ii) of the Agreement. II. DISCUSSION A. Standard of Review “Generally, interpretation of a settlem ent agreement is not an issue uniq u e to patent law, even if arisi ng in the context of a pat ent infringement suit.” Nov a medix, Ltd. v. NDM Ac quisition Corp. , 166 F

. 3d 1177, 1180 (Fed. Cir. 1999) . Accordingly, we apply the law of the appropriate ci rcuit, which in this cas e is the Seventh Cir cuit. See Waymark Corp. v. Porta Sys. Corp. , 334 F.3d 1358, 1362 (F ed. Cir. 2003). In the Seventh Circuit, a district court’s gr ant of summary judgment is rev i ewed de nov o

. Davis v. Con-Way Transp. Cent. Express, Inc. , 368 F.3d 776, 782 (7th Cir. 2004). Summary judgment is proper only if there are no genu ine issues of material fact and the

05-1337 7movant is entitled to judgment as a matter of law. Se e Fed. R. Civ. P. 56(c); Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 250 (1986). In determining whether there is a genuine is sue of material fact, all facts and inferences are viewed in the light most favorable to the party oppos ing the motion. Davis , 368 F.3d at 782. Summary judgment is appropriate only when there is no genuine issue as to any material fact and where the moving party is entitled to judgment as a matter of law. Id. Contract interpretation is ordi narily governed by state law. Unova, Inc. v. Acer Inc. , 363 F.3d 1278, 1280 (Fed. Cir. 2004) (quoting Volt Info. Scis., Inc. v

. Bd. of Trs. of the Leland Stanford J r . Univ. , 489 U.S. 468 (1989)). He re, the Agreement expressly provides that Illinois la w governs interpretati on. We therefore apply Illino i s contract law principles to our interpre tation of the A g reement. See id. Under Illinois law, interpretation of a contract is a question of law, which appellate courts review de nov o

. See Lumpk in v. Envirodyne Indus., Inc. , 933 F.2d 449, 456 (7th Cir. 1991). The breac h determination requires that we assess whether HellermannT yton’s redesigned product infringes the ’732 patent. Claim construction is an issue of law, see Markman v. Westview Instruments, Inc. , 52 F.3d 967, 970-71 (Fed. Cir. 1995) ( en banc ), aff’d , 517 U.S. 370 (1996), that we review de novo

. See Cybor Cor p . v. FAS Techs., Inc. , 138 F.3d 1448, 1456 (Fed. Cir . 1998) ( en banc ); Phillips v. AW H Corp. , 415 F.3d 1303, 1328 (F ed. Cir. 2005) ( en banc ). Infri ngement, whether literal or under the doctrine of equivalents, is a question of fact. Ferguson Beauregard v. Mega Sys., Inc. , 350 F.3d 1327, 1338 (Fed. Cir. 2003). The det er mination of infringement under the doctrine of equivalents is limit ed by two primary legal doc trines, prosecution history

05-1337 8estoppel and the “all elements” rule, the applications of wh ich are questions of law. Seachange Int’l, In c. v. C-COR, Inc. , 413 F.3d 1361, 1378 (Fed. Cir. 2005). B. Analysis 1. Agreement ¶ 1(b)(i ) The distric t court found that because ¶ 1( b)(i) of the Agreeme n t clearly and unambigu o u sly define s “Subject Product” as one, specific produc t (Part No. MCR-SEB) , and because Panduit “does not dispute that the Accused Product is not physically the same product as [Part No. MCR-SEB],” He llermann Tyton was entitled to summary judgment that it did not breach ¶ 1(b)(i). Panduit points first to Foster v. Hallco Manufacturing Co. , 947 F.2d 469 (Fed . Cir. 1991) and KSM Fastening Systems, In c. v. H.A. Jones Co. , 776 F.2d 1522 (Fed. Cir. 1985), to argue that the district court should have read ¶ 1(b)(i) to encompass the Part No. MCR-SEB produ ct and “any accused product having only colorable changes or changes unrelated to the patent claim.” P anduit ass e rts that the accused product is only “colorably different” from P a rt No . MCR-SEB, and that ac cording to Foster and KSM , it is covered by ¶ 1(b)(i). Alternativ ely, Panduit argues t hat the agreement is ambiguous and that to effectuate the parties’ in tent to settle the litigation, we must interpret ¶ 1(b)(i) to encompass the accuse d product. HellermannTyton counters that because the Agreement did not follow an adjudic a tion on the merits, because no injunction issued, and becaus e no consent judgment was entered, Foster and KSM are distinguishable, the patent doctrine of “insubstantial differences” does not apply, and there should be no compariso n between the Part No. MCR-SEB prod uct and the

05-1337 9accused device. HellermannTy t on also count ers that there is no dispute that the accused device is not Part No. MCR-SEB and that the district court’s ruling was correct. We disagr ee with Panduit’s c ontention that Foster and KSM apply to the Agreement, and conclude that these cases are distinguishable. In KSM , an injunction barred products “of the type and nature identifi ed by the Plaintiff in its Com p laint,” and the parties did not dis pute t hat the injunction “is enforce abl e against devices other than the specific [] device of the original suit.” 776 F.2d at 1527. We held that it would no t be appropr iate to bring contempt proceedings for violating such an injunction if there was more than a colorable difference between an accused and adjudged dev ice. Id. at 1530-32. Similarly, the parties in Foster agreed to a consent judgment that found infringement, but made no reference to a specif ic pr oduct or device. 9 4 7 F.2d at 422. In that case, we noted that a new caus e of action was not presented if an accus ed device and an adjudged dev ice we re essentially the s a me. Id. at 479-80. Here, unlik e in KSM and Foster , the parties entered into a settl ement agreement that expressly addressed a spec ific product , Part No. MCR-SEB, in ¶ 1(b )(i) of the Agree m ent. O u r inquiry is not a comparison between an acc u s ed and an adjudged device, but rather the interpretation of that express provision. Under Illinois law, the plain language of the Agreement governs. Lumpkin , 933 F.2d at 456. If contract terms are unambiguous, then the inquiry is over. Id. However, if the language of the contra ct is ambiguous, then the c ourt may consider extrinsic evidenc e to determine the intent of the parties. Id. In this case, ¶ 1(b)(i) of the Agreement states that HellermannTyton must cease marketing “Subject Products,” which incl udes “the HellermannT yton Multi-Channel

05-1337 10Raceway Side Electric Bo x (He llermannTy t on Part No. MCR-SEB).” The question is what is meant by reference in the agreement to Part No. MCR-SEB. Pan duit asserts that the contract contempl ates that Part No. MCR-SEB inc l ude s not only that exact product, but also devices with “merely colorabl e” differences from Part No. MCR-SEB. HellermannTyton inter p rets ¶ 1(b)(i) as incl uding only the spec ific devic e identified as Part No. MCR-SEB. We agree with the district court and Heller m annTyton that ¶ 1(b)(i) covers only the specific devic e ide n tified as Part No. MCR-SEB. T he langua g e of the Ag reement is unambiguous. By its express t e rms, ¶ 1( b)(i) does not include “colorable changes,” modificatio n s, or variations, bu t ment ions only Part No. MCR-SEB. Settlement agreements, like c o nsent judgments, reflect an agreement by hostile litiga n ts on more than just contract terms; they reflect a co mpromise of contested legal positions in matters that are the subject of litigation. See United States v. Armour & Co. , 402 U.S. 673, 681-82 (1971) (“Consent decrees are entered int o by partie s to a cas e after careful negotiation has produced agreement on their precise terms.”); Thatcher v. Kohl’s Dep’t Stores, Inc. , 397 F.3d 1370, 1373-75 (Fed. Cir. 2005) (applying Illinois law, “[t]he consent judgment serves as a carefully crafted settlement agreement between the parties”). Because the language of the Agreement is not am biguous, we do not look t o the parties’ intent to include terms that are absent. [T]he parties have purposes, genera lly opposed to each other, and the resultant [settlement agreement] embodies as much of those opposing purposes as the respective parties have the bargaining power a nd skill to achieve. F o r these reasons, the sc ope of a [settlement agreement] must be discerned within it s four corners, and not by reference to what might satisfy the purposes of one of the parties to i t.

05-1337 11Armour , 402 U.S. at 681-82 (“settlement agreement ” substituted for “consent decree”); see also Thatcher , 397 F.3d at 1375 (“[S] ilence [ on ass i gnment] is the functional equivalent of the parties’ ex pres s intent to exc l ude languag e of assignment.”). The precise an d unambig uous terms of ¶ 1(b)(i) in clu de on ly Part No. MCR-SEB; the district court therefore did not err in in terpreting that provision. We also agree with the district court t hat there is no genuine is sue of material fact that the accused device is not Part No. MCR-SEB. Panduit does not dispute that the accused devic e is not physically the same product as Part No. MCR-SEB. HellermannTyton made the wall abutting the tr unking duct in the accused device solid with no cutaway. Even viewed in a light most favorable to Panduit, there is no question that the accused prod uct is not Part No. MC R-SEB. The district court therefore did not err in granting summary judgment that the a ccused dev ice is not a “Subject P r oduct” as defined by ¶ 1(b)(i) of the Agreement. 2. Agreement ¶ 1(b)(ii) The district court ruled as a matter of la w that the accused device did not infringe the ’732 patent because it was missing the “opening,” “projection,” and “abutment portion” lim itations. On appeal , Panduit argues that each li mitation can be f ound in th e accused product as shown below in Panduit’s Figure 3:

05-1337 12Because we conclude that the accused device does not contain the “opening” limitation, and because the grant of summ ary judgment of no breach of ¶ 1(b)(ii) based on n o ninfringement was proper on that basis alone, we need not reach the other disputed claim terms

. With respect to the “opening” limitation, the district court stated in its sum m ary judgment opinion that “the opening must be in the desc e nded portion [of the abutment portion], and cannot be in the top portion’s end por tion.” The court also concluded that the limitation requires a solid abutment porti on and solid side wall; and that “while the ’732 Patent permits substantial leniency in how wide or narrow the opening must be, the term ‘formed in’ means that ‘the aperture and opening cannot be so wide s u ch that the corresponding abutm ent portion or side wall ceas es to exist.’” Alth ough in its claim construction order the district court hel d that the opening need not be bounded on all sides (inc luding the t op), in analyzing the accused pr oduct, t he district court held that

05-1337 13“the open space identified by Pl aintiff clearly does not descend or hang down from any structure, and is not ‘formed in’ the pr ojection’s abutment portion as construed.” Panduit argues that the claims do not require that the opening descend or hang down from any structure and that the district court improper ly imported this limitation from the preferred embodime nt, in which the opening is bounded at the top. Specifically , Panduit argues that we must c onstrue “formed in” consistently throughou t the specification, that “formed in” means “made within a cross-sect ion of” or “created within an exterior surface or di m ension of,” and that n o thing requires the op ening to be bounded at its top. Panduit ass e rts that th e opening in the accused dev ice is bounde d by the two “ П ”-shaped surfaces and the horizontal secti on, or between the inner legs of the two “ П ”-shaped surfaces. Citing the preferred em bodiment, HellermannTyton c ounters that the opening must hang off of the top porti on of the projection bec ause it must be in the abutment portion of the projection, which itself must hang. HellermannTyton asserts that what Panduit refers to as an opening is not in a hanging portion of the structure becaus e there is nothing from whic h the abutment portion hangs. Moreover, HellermannTyton argues that because the horiz ontal structure and two “ П ”-shaped surfaces are not coplanar, there is no “opening formed in” the abutment. In determining the meaning of the disputed claim limita t ion, we look principally to the intrinsic evidenc e of record, examini ng the claim language itself, the written description, and the prosecution history, if i n evidence. See Phillips , 415 F.3d at 1312- 17. Here, the “opening” limitat ion is defined by two recitati ons in the claim language. First, the opening must be form ed in an abutment portion of the projection. To be

05-1337 14“formed in” an abutment portion of the projection requires us to determine the location of an abutment portion. According to the cl aim, an abutment portion is located to “depend[] from the furthest extent of t he top portion” of the projection. See ’732 patent, col. 7, ll. 19-21. Although Panduit challen ges what constitutes an abutment portion, it does not dispute that to depend from the top portion, an abutment portion must hang down or descend from such top portion. We agree. Therefore, to be “formed in” an abutment portion, the openi ng must be formed in an area that hangs down— i.e. , extends downward—from a top portion of th e projectio n . Sec ond, the claim lan g uage requires that the opening be “in communicati on” with an aperture formed in the side wall. We agree with the district court— and the parties do not dispute—that “in communication” simply requires a passage through whic h wires may be routed. This construction is c onsistent with t he written description, whic h describes “an opening formed in the abutment por tion of the projection which is in communication with an aperture formed in a s i de wall” and an abutment portion “which depends from the furthest extent of the top por tion.” ’732 patent, col. 2, ll. 30-36. Although in the preferred embodiment depict ed in Figure 4, the apertu re 82 formed in the s i d e wa ll 40 is not bounded at the top, this does not s uggest that the opening 80 formed in the abutment portion 74 does not require a top portion. See ’732 patent, col. 4, ll. 46-52. An “abutment portion,” unlike a “side wall,” is described cons istently by both the claim language and the written descript i on as depending— i.e

. , extending downwar d —from a top portion of the projection. ’732 patent, col. 2, ll. 30-31, col. 7, ll . 19-21. To be “formed in” an area that extends downward from a top portion of the projection

05-1337 15necessarily requires that the opening be bounded at top. The pros ecution history is consistent with this interpretati on and provides no further guidanc e. For the foregoing reasons, we conclude that the “opening” mu st be formed i n an area that extends downward fr om a top portion of the projection and mus t provide a passage through whic h wires may pass. Comparing the properly construed claim to the accused devic e, see Cybor Corp. , 138 F.3d at 1454, we note that neither of the two openings argued by Panduit qualify as an “opening” according to t he language of the clai m. First, the openings bounded on three sides by each “ П ”-shaped surface fail to meet the “opening” limitation. Although these openings are “formed in ” an abutment portion, the openings and the aperture are not “in communication” because wires cannot pass through either of these openings and into an aperture in the side wall. Second, the open space between each of the “ П ”- shaped surfaces fails. Although this open space may be “in co mmunication” with an aperture in the side wall, it does not ex t end downward from a top portion of the projection, and therefor e is not “formed in” the abutment portion. Moreover, even if the horiz ontal surface argued by Pandui t is included as part of the abutment portion, the accused device woul d still not meet this limitation. The abutment portion is located extending downward from a top portion of the projection. Accordingly, for the horizontal s u rface to be consider ed an “abutment portion,” the top surface of the curved flange must be cons idered a top portion of the projection. The opening argued by Panduit would t herefore occur abov e the top portion of the projection and not be formed in the abutment portion at all. We agree wit h the district court that

05-1337 16there is no genuine issue of material fact that the accused devi ce does not literally infringe the ’732 patent. Moreover, the doctrine of equivalents canno t be applied here. Application of the doctrine of equivalent s is limit ed by the “all elements rule,” which provides that “the doctrine of equivalent s does not apply if appl ying the doctrine would vitiat e an entire claim limitation.” Asyst Techs., Inc. v. Emtrak, Inc. , 402 F.3d 1188, 1195 (Fed. Cir

. 2005) (citing Warner-Jenkinso n Co. v. Hilton Davis Ch e m . Co. , 520 U.S. 17, 29 (1997)). Claim 1 of the ’732 patent requires an opening in an abutment portion through wh ic h wires may pass from a trunking duct into an o ffset power box. To e x tend the scope of the claim to encompass an accused device in whic h wires bypass the abutment portion altogether would necessarily read the “ opening” limitation out of the claim. See Novartis Pharm. Corp. v. Eon Labs Mfg. , 363 F.3d 1306, 1312 (Fed. Cir . 2004) (holding that a particulate dispersion inside the body cannot infringe under the doctrine of equivalents because it would vitiat e the cl aimed requirement that the disp ersion be prepared outside the body). The doctrine of equiv a lents cannot be applied because it would vitiate the “opening” limitation of the claim. Because we conclude that the accused device does not infringe claim 1 of the ’732 patent, the district court did not err in granting summary judgm ent that the accused device is not a “Subject Product” as def ined by ¶ 1(b)(ii) of the Agreement. III. CONCLUSION Because we find that there is no genuine is sue of materi al fact that the accused device does not meet the plain language of ¶ 1(b)(i), or infringe claim 1 of the ’732

05-1337 17patent as specified in ¶ 1(b )(ii), the district court’s gr ant of summary judgment that HellermannTyton did not breach the Agreement is AFFIRMED

.

05-1337 18