Court Opinion

ID: 9473244
Source: CourtListenerOpinion
Date Created: 2023-08-05 04:24:00.611261+00
Date Added: 2024-06-11T17:43:24.604468
License: Public Domain

NICHOLS, Senior Circuit Judge,
concurring and dissenting.
I agree with and join in Part IV of the court’s opinion, captioned Lost Profits. I do not agree with Parts II and III, The District Court’s Action on Remand, and Intervening Rights, and I dissent from those parts.
With respect to the alleged defective procedure below, I am satisfied that by use of three words from 5A Moore’s Federal Practice, 11 52.06[2] (2d ed. 1984) alluding to “dereliction of duty” the panel’s intent is only to impute legal error to that court, not reprehensible misconduct. The entire sentence from which the three words are quoted reads—
The failure of the trial court to comply with Rule 52, while characterized as a dereliction of duty, does not demand a reversal “if a full understanding of the question presented may be had without the aid of separate findings.” [Footnote omitted.]
The use of such “fighting words” by the learned author therefore does not even imply. that the omission of Rule 52 fact finding, when on paper required, is necessarily even reversible error. The panel here obviously has no difficulty, in its own view, in understanding the question presented, since it proceeds to decide it, though erroneously.
The obligation to make such findings under Rule 52(a) springs into being after an action tried on the facts without a jury, or the grant or refusal of an interlocutory injunction. None of those had occurred after remand. The judge did make elaborate findings after the original trial. For example, he found that Industrial knew of the existence of the reissue patent and of the original, that Industrial copied Seattle-Tacoma’s patented pipe bundle, and that Industrial acted upon advice of counsel. The court also found that Industrial contended it had intervening rights, but had failed to establish any facts which would entitle it to intervening rights. He could very well not recognize that anything had happened to require him to make more findings. If our panel really misses anything that would be helpful, it is not more facts, but an opinion or memo on the requirements of the law of equity applicable to this case. As the only new evidence was Mr. Zier’s affidavit, which is undenied, we can read that as readily as we could the court’s findings had it made any. Where the facts are clear and undisputed, the absence of findings may not be fatal. See generally, Featherstone v. Barash, 345 F.2d 246, 250 (10th Cir.1965). Conclusions of law are not subject to Rule 52(a). Moore’s Federal Practice, 1152.03[2].
Unlike my brethren I, as author, did not recognize or perceive anything in our original opinion to demand detailed findings in the event, which occurred, that the judge saw no reason to reduce damages for infringement of the reissue patent on account of intervening rights, the question being, of course, subsumed as to the original patent. No doubt the author of words for a panel is the last one capable of interpreting them objectively. Reading the words in the judge’s order of July 19, 1984, I thought them sufficient, if only barely so, to show that he had, as we asked, considered the facts as divulged in new evidence which he reopened his record to receive. He elicited only the Zier affidavit. He concluded that Industrial had pointed to no equities worth further discussion. It is very debatable whether the judge, after remand, was under any duty to find any more facts but, if he was, his breach of duty was formal only.
Actually, putting this in context, the only new equitable considerations placed before him were that Industrial had on hand on the reissue date orders for 114 bundles and inventory sufficient to make 224 bundles, *1583with a total investment of $30,539.36. As a source of § 252 equitable considerations, however, nothing in the inventory but the peculiar concave blocks were so processed as to be dedicated to this infringing use alone. They were worth 60 cents each, and being 12,100 in number, all were worth $7,260. They have a powerful leverage indeed as they reduce the liability by approximately $43,000, for the panel clears Industrial of infringement of all 224 bundles because of them.
As Industrial went right on infringing after filling 114 orders and using up the 12,100 blocks, and other items in its inventory on the reissue date, necessarily purchasing more as needed, it is apparent it never intended to exercise equitable intervening rights as such. It does not come into equity with clean hands. Its attitude was one of complete contempt for both the original patent and the reissue. In these circumstances, I do not think the district judge abused his discretion in not making any adjustment for the unfilled orders or the blocks or other inventory items. If he had done so, it would have been, I think, also within his discretion, but if he had given Industrial, as the panel does, a free pass for as many as 224 infringements, I would have thought that an abuse of his discretion. Our suggested possible options in the first opinion respecting application of § 252 were predicated, at least in this author’s mind, on Industrial’s making a far more impressive show of its equities than it did in fact make. The statute, too, seems to me to visualize equities more impressive than unfilled orders and the mere existence in Industrial’s inventory of so many 60 cent blocks, bought in face of the plainest warnings. It seems to contemplate plants built, and matters of that sort.
The statute is so worded that the most obvious equitable adjustment is very likely unauthorized. That would be to credit the infringer with the cost, $7,260, of the blocks in inventory on the reissue date. Assuming, as the panel does, that relief for “intervening rights” must be at a minimum a free license to infringe for some duration, the most equitable duration would be that required to fill the orders for 114 bundles. There would be difficulties in that the customers, who placed the orders, certainly were not asked to excuse Industrial from delivery. If they were asked, persuasion should not have been difficult to obtain since by accepting and using the 114 bundles, they apparently became infringers themselves, a status they might have wished to avoid. I cannot call refusal to make this adjustment an abuse of discretion any more than a decision to make it would be. It is a matter for the district judge to decide, which he has decided.