Opinion ID: 413317
Heading Depth: 3
Heading Rank: 2

Heading: Immediate Intention and Ability.

Text: 60 Although we have found that Trans Tech reasonably feared a contempt or an infringement proceeding brought by Interdynamics, we still must determine whether Trans Tech possessed the  'immediate intention and ability'  to produce the second Trans Tech product, 16 Rengo Co. Ltd. v. Molins Machine Co., Inc., supra, 657 F.2d at 539 (quoting Wembley, Inc. v. Superba Cravats, Inc., supra, 315 F.2d at 89). This immediate intention and ability must have existed at the time Trans Tech filed its motion in the district court and must have been evident from the papers submitted to that court. International Harvester Co. v. Deere & Co., supra, 623 F.2d at 1215. 17 61 Trans Tech submitted to the district court the affidavit of its attorney, Lloyd McAulay, who stressed Trans Tech's desire to proceed immediately with its plans for the second Trans Tech product. McAulay discussed the demise of Trans Tech's previous two attempts to market a rear-window defroster and stated that, at the time of this Court's decision in Interdynamics I, supra, Trans Tech had accepted substantial orders for the first Trans Tech product. McAulay Aff. at p 13. Much of this business can be retained if Trans Tech can immediately provide an alternate product which will permit the installation of a rear window defroster as an after market item. Id. But, in order to accommodate these orders, 62 the dispenser design has to be improved, the product has to be fabricated, orders have to be placed with a supplie[r] for the tape component of the product and shipments have to be made. Yet the heavy marketing season for Trans Tech, as a manufacturer of rear window defrosters, is August through December. Every day that passes from here on in is liekly [sic] to mean lost business. 63 Id. at p 14. 18 Thus, McAulay concluded, Trans Tech is in a position of having to fill orders for its product within the next few weeks or going out of business. 19 Id. at p 10. We believe that this affidavit, coupled with Trans Tech's prior conduct, amply demonstrates an immediate intention to produce the second Trans Tech product. 64 Interdynamics, however, argues that Trans Tech lacked the ability immediately to manufacture the proposed defroster because the product was only in an experimental stage. The McAulay affidavit itself referred to Exhibit C (the second Trans Tech product) as an experimental sample, McAulay Aff. at p 7, and detailed various expected changes in the current version: (1) the dispenser would be modified; (2) a dual tape will probably be used, but the design could entail a single tape or a triple tape; (3) the tape's width would be approximately one-sixteenth of an inch and not one-quarter of an inch, as on the sample, and (4) the adhesive employed to apply the tape to the automobile window would have a red-brown color. Id. at paragraphs 11A-D. However, [a]part form [sic] the width of the tape (and the addition of the coloring mentioned above), the tape is identical to a product presently being manufactured as a sensing tape for use with recording tape on tape recorders. Id. at p 11E. McAulay further stated that Trans Tech planned to purchase this tape from a manufacturer who made it for other usage and thus Trans Tech is not one hundred percent familiar with the exact constituents of the tape, id. at p 11F, but McAulay did convey Trans Tech's understand[ing] of the composition of that tape. Id. at paragraphs 11F-G. According to Interdynamics, however, these uncertainties and modifications placed the district court in the position of render[ing] a decision with respect to an experimental product that admittedly will not be commercially produced or sold. As such the issue is non-justiciable. Brief for Appellees at 11-12. 65 The district court, displaying considerable knowledge and sophistication, engaged in extensive colloquy with counsel on technical matters and emphatically rejected Interdynamics' argument. Far from viewing the experimental sample's design as too indefinite to permit adjudication, the judge found the product's essence to be perfectly unambiguous: 66 THE COURT: You're going to have a mandrel on which you're going to mount two rolls of tape at a given spacing, and the mandrel will go in some sort of holder to enable the two stripes to come out at the end and be applied in approximately parallel position at that spacing. 67 MR. MC AULAY: That's correct. 68 THE COURT: All right [sic]. 69 Interdynamics, Inc. v. Firma Wolf, No. 78-647, Tr. of Hearing (Hearing) 17 (D.N.J. Sept. 9, 1981), App. 365. 70 Throughout the hearing on the show-cause order, the court demonstrated its skepticism about the importance of the details offered by Interdynamics as evidence of the second Trans Tech product's allegedly tentative and amorphous state. 20 First, the court dismissed Interdynamics' contention that the experimental sample provided no clue as to the ultimate design of the dispenser that would house the mandrel. 21 Furthermore, the court noted, the dispenser is not an essential feature of the product as measured against either the Barnard patent or the Wolf product. 22 Nor did the court find potential changes in tape width 23 or composition 24 to be significant. 71 Moreover, Interdynamics itself admitted that the only two critical components of the Barnard patent were the method of maintaining appropriate space relationships between the conductors 25 and the use of some kind of double-layer, sandwich device to accomplish the packaging and application of the electrical elements. 26 Thus, of all the various changes between the experimental model and the final product, only one--the dual tape--related to an essential element of the Barnard patent, spacing. And yet, as to this feature, there actually was little uncertainty: 72 THE COURT: ... 73 Is [the dispenser] going to dispense one or two stripes at the same time? 74 MR. MC AULAY: It will dispense two stripes. Those are the present plans. 75 THE COURT: Spaced? 76 MR. MC AULAY: Spaced from one another. That spacing and showing of two stripes being dispensed, is embodied in this product that was submitted. 77 THE COURT: The sample? 78 MR. MC AULAY: Yes. 79 Hearing at 8, App. 356. 27 Thus, the court saw no obstacle to its ruling on the order to show cause. 80 We cannot say either that the district court committed clear error in finding the second Trans Tech product to be sufficiently developed or that the court abused its discretion in adjudicating the dispute. Nor can we say, on the facts before us, that Trans Tech has failed as a matter of law to demonstrate its ability immediately to produce and market the proposed device. The history of this litigation reveals that Trans Tech has had considerable experience in dealing with rear-window defrosters; indeed, the facts establish the existence of a business enterprise specifically directed to the manufacture and sale of a potentially infringing product, Super Products Corp. v. D P Way Corp., supra, 546 F.2d at 753. 28 We note in passing our decision in Rengo Co. Ltd. v. Molins Machine Co., Inc., supra, in which we held that a company that had done no more than advertise and solicit orders for its new instant order change apparatus [but] had not yet begun the manufacture or sale of the equipment, 657 F.2d at 538, could challenge the validity of a competitor's patent. We believe that Trans Tech's situation fits within the spirit, if not the letter, of Rengo. 29 81 The cases cited to us by Interdynamics do not compel a different conclusion. Interdynamics has relied heavily on the recent decision in International Harvester Co. v. Deere & Co., supra, a suit in which International Harvester (Harvester) sought a declaratory judgment that its CX-41 corn head did not infringe a patent held by Deere. 623 F.2d at 1210. The Seventh Circuit held that Harvester could not maintain the action because it had failed to show an immediate intention and ability to produce the CX-41. 623 F.2d at 1215-17. 30 82 We believe that the key to International Harvester lies in the following language: 83 Our concern is not that the CX-41 will never be produced, but rather that because of the relatively early stage of its development, the design which is before us now may not be the design which is ultimately produced and marketed. For a decision in a case such as this to be anything other than an advisory opinion, the plaintiff must establish that the product presented to the court is the same product which will be produced if a declaration of noninfringement is obtained. 84 623 F.2d at 1216. Harvester's CX-41 was a big, complex machine. 31 Development involved three stages: basic design, testing, and production, including revised tooling. 623 F.2d at 1215. As of May 25, 1979, the date on which Harvester filed its suit, the CX-41 had gone through the design stage and had entered the experimental stage. Id. One gear case already had been subjected to 1500 hours of laboratory testing, but Harvester had yet to perform similar tests on two to five more gear cases. Id. Furthermore, the complete CX-41 had not yet been field-tested in the United States. 623 F.2d at 1216. The testing stage was expected to continue into 1980, and Harvester generally required a full-season test before sending the model into the production stage. Id. Thus, as of May 25, 1979: 85 [n]o production CX-41 had been built, although a complete experimental model had been constructed; no production parts had been made; [Harvester] had provided no description of the CX-41 to its dealers or customers nor had it begun efforts to solicit orders; no maintenance manuals, operator's manuals or advertising materials had been compiled; and tooling was in its early stages. 86 Id. 87 The case before us is far different from International Harvester. Trans Tech does not seek an adjudication with respect to a complicated piece of machinery; it has brought before the Court only some strips of an adhesive-coated conductor wound around a spindle and contained in a dispenser. As the district court opined: This is about as primitive a type of object as I can imagine. This is not like a harvesting machine. Hearing at 19, App. 367. Because of the primitiveness of the design, the court found far less danger than there was in International Harvester that the final product would differ significantly from the experimental model. 32 We agree. 88 Second, because of the difference in complexity between the CX-41 and the second Trans Tech product, actual production of the final model was much less imminent in International Harvester than in the case at bar. Harvester's complaint, filed on May 25, 1979, alleged that the company  'presently plans to begin production of the CX-41 in early 1981,'  623 F.2d at 1215, almost two years after the commencement of the lawsuit. Trans Tech, on the other hand, expressed its intention to begin production within several weeks of filing suit if it were to receive judicial clearance of its proposed product. See McAulay Aff. at paragraphs 10, 13. 89 Third, the Seventh Circuit noted that Harvester had not yet solicited any orders for its CX-41. 623 F.2d at 1216. As we have discussed, however, Trans Tech already had orders on file. These orders had been submitted for the first Trans Tech product, but Trans Tech believed that it would be able to fill the orders by providing the second Trans Tech product as a suitable alternative. See McAulay Aff. at paragraphs 10, 13. There is no reason to doubt Trans Tech's belief. 90 For all of these reasons, we deem International Harvester inapposite to the set of facts before us. Wembley, Inc. v. Superba Cravats, Inc., supra, and Sweetheart Plastics, Inc. v. Illinois Tool Works, Inc., supra, are similarly distinguishable. 33 We thus find that the district court did not abuse its discretion in determining that there was an actual controversy between the parties and in entertaining Trans Tech's essentially declaratory action. 91