Source: https://caselaw.findlaw.com/us-supreme-court/535/722.html
Timestamp: 2019-05-19 08:36:14
Document Index: 184199418

Matched Legal Cases: ['§112', '§112', '§112', '§112', '§112', '§112', '§132', '§112', 'art. 37', '§1', '§8', '§112', '§101', '§112', '§112', '§112', '§112', '§112', '§112', '§112', '§112', '§112']

FESTO CORP. v. SHOKETSU KINZOKU KOGYO KABUSHIKI CO. | FindLaw
FESTO CORP. v. SHOKETSU KINZOKU KOGYO KABUSHIKI CO., LTD., et al.(2002)
Argued: January 8, 2002 Decided: May 28, 2002
Petitioner Festo Corporation owns two patents for an industrial device. When the patent examiner rejected the initial application for the first patent because of defects in description, 35 U. S. C. §112, the application was amended to add the new limitations that the device would contain a pair of one-way sealing rings and that its outer sleeve would be made of a magnetizable material. The second patent was also amended during a reexamination proceeding to add the sealing rings limitation . After Festo began selling its device, respondents (hereinafter SMC) entered the market with a similar device that uses one two-way sealing ring and a nonmagnetizable sleeve . Festo filed suit, claiming that SMC's device is so similar that it infringes Festo's patents under the doctrine of equivalents. The District Court ruled for Festo, rejecting SMC's argument that the prosecution history estopped Festo from saying that SMC's device is equivalent . A Federal Circuit panel initially affirmed, but this Court granted certiorari, vacated, and remanded in light of Warner-Jenkinson Co. v. Hilton Davis Chemical Co., 520 U. S. 17, 29, which had acknowledged that competitors may rely on the prosecution history to estop the patentee from recapturing subject matter surrendered by amendment as a condition of obtaining the patent. On remand, the en banc Federal Circuit reversed, holding that prosecution history estoppel applied. The court ruled that estoppel arises from any amendment that narrows a claim to comply with the Patent Act, not only from amendments made to avoid the prior art, as the District Court had held. The Federal Circuit also held that, when estoppel applies, it bars any claim of equivalence for the element that was amended. The court acknowledged that, under its prior cases, prosecution history estoppel constituted a flexible bar, foreclosing some, but not all, claims of equivalence, depending on the purpose of the amendment and the alterations in the text. However, the court overruled its precedents on the ground that their case-by-case approach had proved unworkable.
Held: Prosecution history estoppel may apply to any claim amendment made to satisfy the Patent Act's requirements, not just to amendments made to avoid the prior art, but estoppel need not bar suit against every equivalent to the amended claim element. Pp. 5-17.
(a) To enable a patent holder to know what he owns, and the public to know what he does not, the inventor must describe his work in "full, clear, concise, and exact terms." §112. However, patent claim language may not describe with complete precision the range of an invention's novelty. If patents were always interpreted by their literal terms, their value would be greatly diminished. Insubstantial substitutes for certain elements could defeat the patent, and its value to inventors could be destroyed by simple acts of copying. Thus, a patent's scope is not limited to its literal terms, but embraces all equivalents to the claims described. See Winans v. Denmead, 15 How. 330, 347. Nevertheless, because it may be difficult to determine what is, or is not, an equivalent, competitors may be deterred from engaging in legitimate manufactures outside the patent's limits, or lulled into developing competing products that the patent secures, thereby prompting wasteful litigation. Each time the Court has considered the doctrine of equivalents, it has acknowledged this uncertainty as the price of ensuring the appropriate incentives for innovation, and it has affirmed the doctrine over dissents that urged a more certain rule. See, e.g., id., at 343, 347. Most recently, Warner-Jenkinson, supra, at 28, reaffirmed the doctrine. Pp. 5-8.
(b) Prosecution history estoppel requires that patent claims be interpreted in light of the proceedings before the Patent and Trademark Office (PTO). When the patentee originally claimed the subject matter alleged to infringe but then narrowed the claim in response to a rejection, he may not argue that the surrendered territory comprised an unforeseen equivalent. See Exhibit Supply Co. v. Ace Patents Corp., 315 U. S. 126, 136-137. The rejection indicates that the patent examiner does not believe the original claim could be patented. While the patentee has the right to appeal, his decision to forgo an appeal and submit an amended claim is taken as a concession that the invention as patented does not reach as far as the original claim. See, e.g., Goodyear Dental Vulcanite Co. v. Davis, 102 U. S. 222, 228. Were it otherwise, the inventor might avoid the PTO's gatekeeping role and seek to recapture in an infringement action the very subject matter surrendered as a condition of receiving the patent. Pp. 8-9.
(c) Prosecution history estoppel is not limited to amendments intended to narrow the patented invention's subject matter, e.g., to avoid prior art, but may apply to a narrowing amendment made to satisfy any Patent Act requirement, including §112's requirements concerning the patent application's form. In Warner-Jenkinson, the Court made clear that estoppel applies to amendments made for a "substantial reason related to patentability," 520 U. S., at 33, but did not purport to catalog every reason that might raise an estoppel. Indeed, it stated that even if the amendment's purpose were unrelated to patentability, the court might consider whether it was the kind of reason that nonetheless might require estoppel. Id., at 40-41. Simply because estoppel has been discussed most often in the context of amendments made to avoid the prior art, see, e.g., id., at 30, it does not follow that amendments made for other purposes will not give rise to estoppel. Section 112 requires that the application describe, enable, and set forth the best mode of carrying out the invention. The patent should not issue if these requirements are not satisfied, and an applicant's failure to meet them could lead to the issued patent being held invalid in later litigation. Festo's argument that amendments made to comply with §112 concern the application's form and not the invention's subject matter conflates the patentee's reason for making the amendment with the impact the amendment has on the subject matter. Estoppel arises when an amendment is made to secure the patent and the amendment narrows the patent's scope. If a §112 amendment is truly cosmetic, it would not narrow the patent's scope or raise an estoppel. But if a §112 amendment is necessary and narrows the patent's scope--even if only for better description--estoppel may apply. Pp. 10-12.
(d) Prosecution history estoppel does not bar the inventor from asserting infringement against every equivalent to the narrowed element. Though estoppel can bar challenges to a wide range of equivalents, its reach requires an examination of the subject matter surrendered by the narrowing amendment. The Federal Circuit's complete bar rule is inconsistent with the purpose of applying the estoppel in the first place--to hold the inventor to the representations made during the application process and the inferences that may be reasonably drawn from the amendment. By amending the application, the inventor is deemed to concede that the patent does not extend as far as the original claim, not that the amended claim is so perfect in its description that no one could devise an equivalent. The Court's view is consistent with precedent and PTO practice . The Court has consistently applied the doctrine in a flexible way, considering what equivalents were surrendered during a patent's prosecution, rather than imposing a complete bar that resorts to the very literalism the equivalents rule is designed to overcome. E.g., Goodyear Dental Vulcanite Co. v. Davis, 102 U. S. 222, 230. The Federal Circuit ignored Warner-Jenkinson 's instruction that courts must be cautious before adopting changes that disrupt the settled expectations of the inventing community. See 520 U. S., at 28. Inventors who amended their claims under the previous case law had no reason to believe they were conceding all equivalents. Had they known, they might have appealed the rejection instead. Warner-Jenkinson struck the appropriate balance by placing the burden on the patentee to prove that an amendment was not made for a reason that would give rise to estoppel. Id., at 33. Similarly, the patentee should bear the burden of showing that the amendment does not surrender the particular equivalent in question. As the author of the claim language, his decision to narrow his claims through amendment may be presumed to be a general disclaimer of the territory between the original claim and the amended claim. Exhibit Supply, supra, at 136-137. However, in cases in which the amendment cannot reasonably be viewed as surrendering a particular equivalent--e.g., where the equivalent was unforeseeable at the time of the application or the rationale underlying the amendment bears but a tangential relation to the equivalent--the patentee can rebut the presumption that prosecution history estoppel bars a finding of equivalence by showing that at the time of the amendment one skilled in the art could not reasonably be expected to have drafted a claim that would have literally encompassed the alleged equivalent. Pp. 12-16.
(e) Whether Festo has rebutted the presumptions that estoppel applies and that the equivalents at issue have been surrendered should be determined in the first instance by further proceedings below. Pp. 16-17.
KINZOKU KOGYO KABUSHIKI CO., LTD., et al.
To reduce the uncertainty, Warner-Jenkinson acknowledged that competitors may rely on the prosecution history, the public record of the patent proceedings. In some cases the Patent and Trademark Office (PTO) may have rejected an earlier version of the patent application on the ground that a claim does not meet a statutory requirement for patentability. 35 U. S. C. §132 (1994 ed., Supp. V). When the patentee responds to the rejection by narrowing his claims, this prosecution history estops him from later arguing that the subject matter covered by the original, broader claim was nothing more than an equivalent. Competitors may rely on the estoppel to ensure that their own devices will not be found to infringe by equivalence.
Petitioner Festo Corporation owns two patents for an improved magnetic rodless cylinder, a piston-driven device that relies on magnets to move objects in a conveying system. The device has many industrial uses and has been employed in machinery as diverse as sewing equipment and the Thunder Mountain ride at Disney World. Although the precise details of the cylinder's operation are not essential here, the prosecution history must be
Petitioner's patent applications, as often occurs, were amended during the prosecution proceedings. The application for the first patent, the Stoll Patent (U. S. Patent No. 4,354,125), was amended after the patent examiner rejected the initial application because the exact method of operation was unclear and some claims were made in an impermissible way. (They were multiply dependent.) 35 U. S. C. §112 (1994 ed.). The inventor, Dr. Stoll, submitted a new application designed to meet the examiner's objections and also added certain references to prior art. 37 CFR §1.56 (2000). The second patent, the Carroll Patent (U. S. Patent No. 3,779,401), was also amended during a reexamination proceeding. The prior art references were added to this amended application as well. Both amended patents added a new limitation--that the inventions contain a pair of sealing rings, each having a lip on one side, which would prevent impurities from getting on the piston assembly. The amended Stoll Patent added the further limitation that the outer shell of the device, the sleeve, be made of a magnetizable material.
SMC contends that Festo is estopped from making this argument because of the prosecution history of its patents. The sealing rings and the magnetized alloy in the Festo product were both disclosed for the first time in the amended applications. In SMC's view, these amendments narrowed the earlier applications, surrendering alternatives that are the very points of difference in the competing devices--the sealing rings and the type of alloy used to make the sleeve. As Festo narrowed its claims in these ways in order to obtain the patents, says SMC, Festo is now estopped from saying that these features are immaterial and that SMC's device is an equivalent of its own.
The United States District Court for the District of Massachusetts disagreed. It held that Festo's amendments were not made to avoid prior art, and therefore the amendments were not the kind that give rise to estoppel. A panel of the Court of Appeals for the Federal Circuit affirmed. 72 F. 3d 857 (1995). We granted certiorari, vacated, and remanded in light of our intervening decision in Warner-Jenkinson v. Hilton Davis Chemical Co., 520 U. S. 17 (1997). After a decision by the original panel on remand, 172 F. 3d 1361 (1999), the Court of Appeals ordered rehearing en banc to address questions that had divided its judges since our decision in Warner-Jenkinson. 187 F. 3d 1381 (1999).
The patent laws "promote the Progress of Science and useful Arts" by rewarding innovation with a temporary monopoly. U. S. Const., Art. I, §8, cl. 8. The monopoly is a property right; and like any property right, its boundaries should be clear. This clarity is essential to promote progress, because it enables efficient investment in innovation. A patent holder should know what he owns, and the public should know what he does not. For this reason, the patent laws require inventors to describe their work in "full, clear, concise, and exact terms," 35 U. S. C. §112, as part of the delicate balance the law attempts to maintain between inventors, who rely on the promise of the law to bring the invention forth, and the public, which should be encouraged to pursue innovations, creations, and new ideas beyond the inventor's exclusive rights. Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U. S. 141, 150 (1989).
The debate continued in Graver Tank & Mfg. Co. v. Linde Air Products Co., 339 U. S. 605 (1950), where the Court reaffirmed the doctrine. Graver Tank held that patent claims must protect the inventor not only from those who produce devices falling within the literal claims of the patent but also from copyists who "make unimportant and insubstantial changes and substitutions in the patent which, though adding nothing, would be enough to take the copied matter outside the claim, and hence outside the reach of law." Id., at 607. Justice Black, in dissent, objected that under the doctrine of equivalents a competitor "cannot rely on what the language of a patent claims. He must be able, at the peril of heavy infringement damages, to forecast how far a court relatively unversed in a particular technological field will expand the claim's language ... ." Id., at 617.
The first question in this case concerns the kinds of amendments that may give rise to estoppel. Petitioner argues that estoppel should arise when amendments are intended to narrow the subject matter of the patented invention, for instance, amendments to avoid prior art, but not when the amendments are made to comply with requirements concerning the form of the patent application. In Warner-Jenkinson we recognized that prosecution history estoppel does not arise in every instance when a patent application is amended. Our "prior cases have consistently applied prosecution history estoppel only where claims have been amended for a limited set of reasons," such as "to avoid the prior art, or otherwise to address a specific concern--such as obviousness--that arguably would have rendered the claimed subject matter unpatentable." 520 U. S., at 30-32. While we made clear that estoppel applies to amendments made for a "substantial reason related to patentability," id., at 33, we did not purport to define that term or to catalog every reason that might raise an estoppel. Indeed, we stated that even if the amendment's purpose were unrelated to patentability, the court might consider whether it was the kind of reason that nonetheless might require resort to the estoppel doctrine. Id., at 40-41.
We agree with the Court of Appeals that a narrowing amendment made to satisfy any requirement of the Patent Act may give rise to an estoppel. As that court explained, a number of statutory requirements must be satisfied before a patent can issue. The claimed subject matter must be useful, novel, and not obvious. 35 U. S. C. §§101-103 (1994 ed. and Supp. V). In addition, the patent application must describe, enable, and set forth the best mode of carrying out the invention. §112 (1994 ed.). These latter requirements must be satisfied before issuance of the patent, for exclusive patent rights are given in exchange for disclosing the invention to the public. See Bonito Boats, 489 U. S., at 150-151. What is claimed by the patent application must be the same as what is disclosed in the specification; otherwise the patent should not issue. The patent also should not issue if the other requirements of §112 are not satisfied, and an applicant's failure to meet these requirements could lead to the issued patent being held invalid in later litigation.
Petitioner contends that amendments made to comply with §112 concern the form of the application and not the subject matter of the invention. The PTO might require the applicant to clarify an ambiguous term, to improve the translation of a foreign word, or to rewrite a dependent claim as an independent one. In these cases, petitioner argues, the applicant has no intention of surrendering subject matter and should not be estopped from challenging equivalent devices. While this may be true in some cases, petitioner's argument conflates the patentee's reason for making the amendment with the impact the amendment has on the subject matter.
Estoppel arises when an amendment is made to secure the patent and the amendment narrows the patent's scope. If a §112 amendment is truly cosmetic, then it would not narrow the patent's scope or raise an estoppel. On the other hand, if a §112 amendment is necessary and narrows the patent's scope--even if only for the purpose of better description--estoppel may apply. A patentee who narrows a claim as a condition for obtaining a patent disavows his claim to the broader subject matter, whether the amendment was made to avoid the prior art or to comply with §112. We must regard the patentee as having conceded an inability to claim the broader subject matter or at least as having abandoned his right to appeal a rejection. In either case estoppel may apply.
Petitioner concedes that the limitations at issue--the sealing rings and the composition of the sleeve--were made for reasons related to §112, if not also to avoid the prior art. Our conclusion that prosecution history estoppel arises when a claim is narrowed to comply with §112 gives rise to the second question presented: Does the estoppel bar the inventor from asserting infringement against any equivalent to the narrowed element or might some equivalents still infringe? The Court of Appeals held that prosecution history estoppel is a complete bar, and so the narrowed element must be limited to its strict literal terms. Based upon its experience the Court of Appeals decided that the flexible-bar rule is unworkable because it leads to excessive uncertainty and burdens legitimate innovation. For the reasons that follow, we disagree with the decision to adopt the complete bar.
Though prosecution history estoppel can bar challenges to a wide range of equivalents, its reach requires an examination of the subject matter surrendered by the narrowing amendment. The complete bar avoids this inquiry by establishing a per se rule; but that approach is inconsistent with the purpose of applying the estoppel in the first place--to hold the inventor to the representations made during the application process and to the inferences that may reasonably be drawn from the amendment. By amending the application, the inventor is deemed to concede that the patent does not extend as far as the original claim. It does not follow, however, that the amended claim becomes so perfect in its description that no one could devise an equivalent. After amendment, as before, language remains an imperfect fit for invention. The narrowing amendment may demonstrate what the claim is not; but it may still fail to capture precisely what the claim is. There is no reason why a narrowing amendment should be deemed to relinquish equivalents unforeseeable at the time of the amendment and beyond a fair interpretation of what was surrendered. Nor is there any call to foreclose claims of equivalence for aspects of the invention that have only a peripheral relation to the reason the amendment was submitted. The amendment does not show that the inventor suddenly had more foresight in the drafting of claims than an inventor whose application was granted without amendments having been submitted. It shows only that he was familiar with the broader text and with the difference between the two. As a result, there is no more reason for holding the patentee to the literal terms of an amended claim than there is for abolishing the doctrine of equivalents altogether and holding every patentee to the literal terms of the patent.
This view of prosecution history estoppel is consistent with our precedents and respectful of the real practice before the PTO. While this Court has not weighed the merits of the complete bar against the flexible bar in its prior cases, we have consistently applied the doctrine in a flexible way, not a rigid one. We have considered what equivalents were surrendered during the prosecution of the patent, rather than imposing a complete bar that resorts to the very literalism the equivalents rule is designed to overcome. E.g., Goodyear Dental Vulcanite Co., 130 U. S. 456, 465 (1889).
When the patentee is unable to explain the reason for amendment, estoppel not only applies but also "bar[s] the application of the doctrine of equivalents as to that element." Ibid. These words do not mandate a complete bar; they are limited to the circumstance where "no explanation is established." They do provide, however, that when the court is unable to determine the purpose underlying a narrowing amendment--and hence a rationale for limiting the estoppel to the surrender of particular equivalents--the court should presume that the patentee surrendered all subject matter between the broader and the narrower language.
On the record before us, we cannot say petitioner has rebutted the presumptions that estoppel applies and that the equivalents at issue have been surrendered. Petitioner concedes that the limitations at issue--the sealing rings and the composition of the sleeve--were made in response to a rejection for reasons under §112, if not also because of the prior art references. As the amendments were made for a reason relating to patentability, the question is not whether estoppel applies but what territory the amendments surrendered. While estoppel does not effect a complete bar, the question remains whether petitioner can demonstrate that the narrowing amendments did not surrender the particular equivalents at issue. On these questions, respondents may well prevail, for the sealing rings and the composition of the sleeve both were noted expressly in the prosecution history. These matters, however, should be determined in the first instance by further proceedings in the Court of Appeals or the District Court.