Court Opinion

ID: 211777
Source: CourtListenerOpinion
Date Created: 2011-03-13 08:31:29+00
Date Added: 2024-06-11T17:28:08.530917
License: Public Domain

NOTE: Pursuant to Fed. Cir. R. 47.6, this disposition is not
             citable as precedent. It is a public record.

United States Court of Appeals for the Federal Circuit

                                     04-1510, -1538

                                CARL LANDERS
                      and LANDERS HORIZONTAL DRILL, INC.,

                                                 Plaintiffs-Appellants,

                                            v.

                                   SIDEWAYS, LLC,

                                                 Defendant-Cross Appellant.

                            __________________________

                               DECIDED: July 27, 2005
                            __________________________

Before LOURIE, RADER, and GAJARSA, Circuit Judges.

LOURIE, Circuit Judge.

      Carl Landers and Landers Horizontal Drill, Inc. (collectively “Landers”) appeal

from the decision of the United States District Court for the Western District of Kentucky

granting judgment of noninfringement of United States Patents 5,413,184, 5,853,056,

and 6,125,949 in favor of Sideways, LLC (“Sideways”). Landers v. Sideways, LLC, No.

4:00CV-35-M (W.D. Ky. Mar. 11, 2004) (“Final Decision”). Landers also appeals from

the grant of summary judgment denying enforcement of the license agreement’s

litigation indemnity provision. Landers v. Sideways, LLC, No. 4:00CV-35-M (W.D. Ky.

Oct. 1, 2003). Sideways cross-appeals from the decision of the court granting judgment
that the asserted patents have not been proved to be invalid and that Sideways is liable

for the cost of replacement equipment. Because we agree with the district court that (1)

Sideways does not infringe the ’184 patent, (2) Landers is not entitled to litigation

expenses under the license agreement, (3) the ’184, ’056, and ’949 patents have not

been proved to be invalid, and (4) Sideways is liable for the cost of replacement

equipment, we affirm in part. Because the district court improperly construed the “cutter

head” limitation of the ’949 patent and the “guide tracks” limitation of the ’056 patent, we

vacate in part the court’s decision granting judgment of noninfringement and remand for

further proceedings consistent with this opinion.

                                     BACKGROUND

         The ’184, ’056, and ’949 patents are each entitled “Method of and Apparatus for

Horizontal Well Drilling,” and were issued to Carl Landers as inventor. The ’056 and

’949 patents issued from continuation-in-part applications of the application that also led

to the ’184 patent. The invention relates to a drill that can penetrate through a well

casing and the surrounding earth in a horizontal direction. By drilling horizontally, the

patented drill can remove oil and gas from reservoirs surrounding pre-existing wells.

’184 Patent, col. 1, ll. 21-26. The preferred embodiment of the patented drill is shown

below.

         The basic components of the patented invention include upset tubing (18) which

extends down the well casing (12). The upset tubing is connected to an elbow (20) that

redirects either a ball cutter (22) or a nozzle blaster (46) from a vertical to a horizontal

orientation. The drill operates by having the ball cutter first cut through the well casing

and surrounding earth. Id., col. 1, ll. 61-66. The ball cutter is removed from the upset

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tubing and replaced with a nozzle blaster. By ejecting high pressure fluid into the initial

cut made by a ball cutter, the nozzle blaster further extends the cut into the earth. Id.,

col. 1, l. 61 to col. 2, l. 5.

        Appellant Carl Landers is a resident of Kentucky and president of Landers

Horizontal Drill, Inc., a Kentucky corporation.     Landers has been involved in the

exploration and production of oil and gas since the 1970’s.         On March 14, 1997,

Landers and Appellee Sideways entered into a license agreement, under which

Sideways was provided drilling equipment and granted the right to use the patented

technology. Sideways eventually stopped making payments required by the license

agreement and the agreement expired. On January 14, 2000, Landers filed suit against

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Sideways, alleging use of the patented technology without permission.1          Sideways

denied Landers’ allegations and counterclaimed, inter alia, that the patents were invalid.

       After completing a bench trial, the district court entered judgment that Sideways

did not infringe Landers’ patents and that the patents were not proved to be invalid. But

the court also held that Sideways was liable for failing to pay for replacement equipment

that it had received from Landers during the term of the license agreement. In an earlier

proceeding, on summary judgment, the court held that the license agreement did not

require Sideways to indemnify Landers for expenses that Landers incurred in defending

itself in a separate litigation (the “Howell litigation”).

       Addressing Landers’ claim of infringement of the ’184 patent, the district court

noted that all claims in the patent contained the means-plus-function limitation “cutting

means.” After reviewing the patent specification, the court determined that the only

disclosed structure capable of performing the “cutting means” function was a ball cutter.

The accused device, however, used a hole saw, which is a cylindrical structure with a

serrated edge.      The court concluded that the two structures were not equivalent

because, although the structures performed the same function, in order to create a hole

in the well casing, they performed the function in substantially different ways. Final

Decision, slip op. at 31. As the court observed, a ball cutter mills away at the well

casing, whereas a hole saw cuts circumferentially through the casing, creating a disc.

       With respect to the ’056 patent, the district court determined whether the accused

device met the “guide tracks” limitation in claim 1. In attempting to construe the term

       1
              The suit was originally filed in state court for nonpayment and
repossession of the technology covered by the license agreement, but removed to
federal court based on diversity jurisdiction.

04-1510, -1538                                   4
“guide tracks,” the court first noted that neither the specification nor the prosecution

history provided any guidance concerning what that term means. Therefore, the court

construed the claim “so as to sustain its validity.” Upon review of the prior art, namely,

United States Patents 2,345,816 and 4,007,797, the court concluded that the term

“guide tracks” cannot cover a pin and groove structure, otherwise the ’056 patent would

be invalid for obviousness. Id., slip op. at 38. Because the accused device had a pin

and groove structure, the court held that claim 1 was not infringed, literally or

equivalently.

      With respect to the ’949 patent, the district court determined whether the accused

device met the “cutter head” limitation. In construing the term, the court stated that,

although a person of ordinary skill in the art would have understood the term “cutter

head” as encompassing a number of different cutting mechanisms, it did “not believe

that they would have known which particular mechanism would be capable of

performing the claimed function—i.e., penetrating through well casing.” Id., slip op. at

45. Otherwise finding the term indefinable, the court construed the term as a means-

plus-function limitation and identified the corresponding structure in the specification to

be a ball cutter. For the same reasons that it found the accused device’s hole saw not

to meet the “cutting means” limitation of the ’184 patent, the court also found the

accused device did not meet the “cutter head” limitation. Id., slip op. at 46.

      The district court also addressed whether the patents were invalid for lack of

enablement. In rejecting Sideways’ claim of lack of enablement, i.e., that the patents

were inoperative because the disclosed ball cutter could not penetrate the well casing,

the court cited conflicting evidence presented by the litigants. According to the court,

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the evidence indicted that the ball cutter was successful part of the time. With this

factual finding, the court held that Sideways did not meet its burden of proving facts

constituting clear and convincing evidence that the patents were invalid.

      The district court entered final judgment on May 4, 2004.             Landers timely

appealed and Sideways timely cross-appealed to this court.           We have jurisdiction

pursuant to 28 U.S.C. § 1295(a)(1).

                                      DISCUSSION

       Claim construction is an issue of law, Markman v. Westview Instruments, Inc., 52

F.3d 967, 970-71 (Fed. Cir. 1995) (en banc), that we review de novo, Cybor Corp. v.

FAS Techs., Inc., 138 F.3d 1448, 1456 (Fed. Cir. 1998) (en banc). Whether an accused

device infringes a claim, either literally or under the doctrine of equivalents, is an issue

of fact that, following a bench trial, we review for clear error. WMS Gaming, Inc. v. Int’l

Game Tech., 184 F.3d 1339, 1346 (Fed. Cir. 1999). Enablement is a question of law,

based on underlying factual inquiries, that we review de novo. Enzo Biochem, Inc. v.

Calgene, Inc., 188 F.3d 1362, 1369 (Fed. Cir. 1999).

I.     Infringement

       A.     The ’949 Patent

       Landers asserts that the district court erred in construing the “cutter head”

limitation of claim 33 as a means-plus-function limitation.       Landers notes that the

limitation does not contain the term “means,” which presumptively indicates that it is not

a means-plus-function limitation.     Moreover, Landers argues that Sideways did not

provide any evidence demonstrating that the term “cutter head” lacks sufficiently definite

structure to justify its construction as a means-plus-function limitation. Instead, Landers

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contends that the court should have given the limitation its ordinary and customary

meaning.

       We agree with Landers that the district court improperly construed the term

“cutter head” as a means-plus-function limitation. “A claim limitation that does not use

‘means’ will trigger the rebuttable presumption that § 112, ¶ 6 does not apply.” CCS

Fitness, Inc. v. Brunswick Corp., 288 F.3d 1359, 1369 (Fed. Cir. 2002) (citations

omitted). The presumption may be rebutted by demonstrating that the claim term fails

to recite sufficiently definite structure. Id. Despite Sideways’ argument to the contrary,

however, the presumption has not been rebutted here.          Indeed, claim 33 contains

several limitations providing structure to the cutter head, e.g., the cutter head must

rotate, it is connected at one end to a “flexible shaft,” and it must be moveable through

the “inlet” and “outlet” of an L-shaped “passageway.” Moreover, the court found that a

person of ordinary skill in the art would have understood the term to “encompass[] a

number of different cutting mechanisms.” See Watts v. XL Sys., Inc., 232 F.3d 877,

880-81 (Fed. Cir. 2000) (“To help determine whether a claim term recites sufficient

structure, we examine whether it has an understood meaning in the art.”).

       That the district court’s construction, which limited “cutter head” to a ball cutter

and its equivalents, is erroneous is further supported by dependent claim 34. Under the

doctrine of claim differentiation, it is presumed that different claims will have different

scopes. See Phillips v. AWH Corp., Nos. 03-1269, -1286, slip op. at 13 (Fed. Cir. July

12, 2005) (“the presence of a dependent claim that adds a particular limitation gives rise

to a presumption that the limitation in question is not present in the independent claim”).

Claim 34 limits the “cutter head” recited in independent claim 33 to “a ball cutter.” Thus,

04-1510, -1538                              7
while the doctrine of claim differentiation is not absolute, it works against the court’s

interpretation, which gives claims 33 and 34 the same scope.

       To support the district court’s interpretation of the term “cutter head” as a means-

plus-function limitation, Sideways argues that the term should not be given its ordinary

meaning. According to Sideways, the patentee experimented unsuccessfully with many

different types of cutter heads and succeeded only with a ball cutter. This argument,

however, misses the point. The relevant inquiry is how a person of ordinary skill in the

art would have understood the simple term “cutter head,” not whether other cutter heads

succeeded or failed in cutting well casings.       Moreover, we note that the patent

specification does not indicate that only a ball cutter is capable of making a hole in a

well casing.

       We also reject Sideways’ contention that the term “cutter head” was properly

construed as a means-plus-function limitation because it lacks sufficiently definite

structure. Specifically, Sideways argues that the patent specification and claims do not

provide any structural detail concerning the cutter head. The law does not require,

however, that the specification and claims contain exacting details of every structure

recited in the claims. As we explained above, the relevant inquiry focuses on whether a

person of ordinary skill in the art would have understood the limitation “cutter head” to

have a sufficiently definite structure.

       Unless the intrinsic evidence compels a contrary result, a claim limitation should

be given its ordinary and customary meaning. Phillips, slip op. at 9. We note that

Landers, in its appellate briefing, has provided a good starting point for this task on

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remand by providing examples of “cutter heads” in the prior art.2 Appellants’ Opening

Br., at 23-25. Accordingly, we vacate the district court’s finding of noninfringement of

the ’949 patent, to the extent that that finding was based on an erroneous claim

construction of the term “cutter head.” Furthermore, we remand for the court to give the

term “cutter head” its ordinary and customary meaning,3 and redetermine whether

Sideways’ device meets that limitation.

      B.     The ’056 Patent

      Landers assigns error to the district court for giving the limitation “guide tracks,”

as it appears in claim 1, the same construction as it did in claim 2.        According to

Landers, the guide tracks in claim 1 guide a nozzle blaster down the well casing,

whereas the guide tracks in claim 2 guide a ball cutter. Landers contends that because

the claims cover different inventions, the limitation “guide tracks” should also be

construed differently.    Landers also argues that the court erred in finding no

infringement of claim 1 under the doctrine of equivalents. Landers asserts that the

court, in making that finding, improperly assumed that claim 1 would be invalid for

obviousness if the scope of the term “guide tracks” was broad enough to cover the

accused device’s pin and groove structure.

      2
              Sideways argues that the district court did attempt to construe, to no avail,
the term “cutter head” by applying its ordinary and customary meaning. Appellee’s
Opposition Br., at 17 n.7. But Sideways provides no citation showing, nor can we
discern any from the record ourselves, the court engaging in any relevant analysis.
      3
             On remand, we caution the district court regarding its reliance on
testimony from any patent attorney on technical issues, as opposed to issues
concerning legal procedure. In particular, a patent expert should not be permitted to
construe claim terms unless he is first qualified as an expert in the pertinent art.

04-1510, -1538                               9
       We do not agree with Landers that the district court erred by not construing the

“guide tracks” limitation differently for claims 1 and 2. In fact, our case law explicitly

states that “the meaning of a term in a claim must be defined in a manner that is

consistent with its appearance in other claims in the same patent.” CVI/Beta Ventures,

Inc. v. Tura LP, 112 F.3d 1146, 1159 (Fed. Cir. 1997). Indeed, Landers provides no

persuasive reasoning, nor can we discern from the patent ourselves, why the guide

tracks used to guide a nozzle blaster, as required by claim 1, cannot also guide a motor

for movement of the ball cutter, as required by claim 2.

       We do, however, conclude that the district court clearly erred in finding that a pin

and groove structure would not meet the “guide tracks” limitation under the doctrine of

equivalents. The court’s error stems from its not construing the “guide tracks” term

before concluding that the accused device’s pin and groove structure does not meet

that limitation, either literally or equivalently. The court’s rationale for proceeding in

such a manner appears to be that claim construction was unnecessary because any

construction in favor of Landers on “guide tracks” would invalidate the claim. As we

explained in Nazomi Communications, Inc. v. ARM Holdings, PLC, 403 F.3d 1364 (Fed.

Cir. 2005), however, this rationale is critically flawed.4

       In Nazomi, the district court adopted a narrower claim interpretation in order to

preserve the claim’s validity. Id. at 1367-68. We criticized this approach of focusing on

validity, and, in the process, glossing over the intrinsic evidence that must inform the

court’s claim construction. Id. at 1368. Pertinent to this appeal, we advised that “it is

essential to understand the claims before their breath is limited for purposes of

       4
              Although Nazomi issued after the district court rendered its decision on
appeal, the case law expounded upon in Nazomi was established prior to its issuance.

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preserving validity. “Otherwise the construing court has put the validity cart before the

claim construction horse.” Id., at 1368-69. Here, the court clearly did not construe the

term. Thus, it should not have proceeded to narrow the limitation’s construction for

purposes of preserving validity. To borrow the Nazomi court’s adage, there is a validity

cart, but no claim construction horse.

       Indeed, the flaw in the district court’s analysis is further exposed by the possibility

that there is only one sustainable construction for claim 1. Under such a circumstance it

would be inappropriate for the district court to construe the claim to preserve its validity.

See Rhine v. Casio, Inc., 183 F.3d 1342, 1345 (Fed. Cir. 1999) (claims should not be

interpreted to preserve their validity if such an interpretation is contrary to the claim’s

language and the written description).         Only after the court completes its claim

construction analysis, which it has not done here, can it determine whether competing

interpretations of “guide tracks” even exist, and only then is it permissible for the court to

choose an interpretation that may preserve the claim’s validity.

       Accordingly, we vacate the district court’s finding of noninfringement, both literally

and under the doctrine of equivalents, of claim 1 of the ’056 patent and remand for the

court to give the “guide tracks” limitation its ordinary and customary meaning consistent

with the intrinsic evidence. Moreover, the limitation “guide tracks” is not indefinable

merely because the patent specification and the prosecution history do not provide a

“clear description” of the term, as the district court appears to conclude. Final Decision,

slip op. at 35.

       C.

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              The ’184 Patent

      Landers asserts that the district court erred in its means-plus-function analysis of

the “cutting means” limitation. According to Landers, the court unduly limited the range

of equivalents for structures corresponding to the “cutting means” limitation to a

tungsten carbide ball cutter. Under the proper analysis, taking into consideration that

the claimed function is merely to “cut a hole,” Landers argues that the accused device’s

hole saw is an equivalent structure.

      Contending that insubstantial differences exist between the ball cutter and the

hole saw, Landers notes that both cutters rotate, have roughened edges to facilitate

cutting, and, due to those structural features, the result is a round hole being cut.

Moreover, Landers assigns error to the district court’s emphasis on how the two

structures mechanically operate to cut a hole, namely, that a ball cutter mills a hole,

whereas a hole saw cuts at the circumferential edge. According to Landers, nothing in

the ’184 patent places any importance on how a hole is cut through the well casing.

Landers also argues that the court did not give enough weight to evidence

demonstrating that a ball cutter and a hole saw were interchangeable structures.

      We conclude that the district court did not clearly err in finding that the hole saw

of the accused device does not meet the “cutting means” limitation.           As the court

recognized, a ball cutter and a hole saw are not identical structures. Moreover, the

court properly found that milling is a significantly different way of cutting through a well

casing from cutting a solid disc. Landers’ remark that the patent does not stress the

importance of the way a hole is cut through the well casing is not persuasive; indeed, it

is not uncommon that one finds a patent without explicit statements limiting its range of

04-1510, -1538                              12
equivalents.   Moreover, as the court noted, evidence of interchangeability does not

necessarily warrant a finding of equivalents under 35 U.S.C. § 112, ¶ 6. Thus, we affirm

the district court’s final judgment of noninfringement of the ’184 patent.

       II.     Invalidity

       On cross-appeal, Sideways challenges the district court’s determination that the

patents in suit are not invalid for lack of enablement under 35 U.S.C. § 112, ¶ 1.

According to Sideways, the patents are invalid because a person of ordinary skill in the

art would not have been able to successfully mill a hole through a well casing with the

ball cutter disclosed in the patents. As support for its position, Sideways makes the

factual contention that not a single person of skill in the art, including Landers and

Sideways, has ever successfully made and used a ball cutter to mill a hole through a

well casing.

       For Sideways to prevail on its claim of invalidity for lack of enablement, however,

it must demonstrate, at a minimum, that the district court’s underlying finding of fact that

“the ball cutter was successful some of the time” was clearly erroneous. Sideways has

not met its burden. In reaching its finding of fact, the district court properly considered

Messrs Pomeroy’s and Woolridge’s testimonies regarding their observations of the

patented drill in the field and their accompanying inference that the drill was working

successfully, i.e., that it increased production of oil. Sideways does not challenge the

truth of these observations, but rather it quibbles with the fact that the two witnesses did

not actually see the ball cutter drill a hole through the well casing. Sideways’ quibble,

however, does not leave us with a firm conviction that the district court has made an

error in its finding of fact. Moreover, aside from recounting specific instances when the

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ball cutter purportedly did not work, Sideways does not point to any evidence in the

record proving that a ball cutter would be inoperative under all drilling conditions,

confirming Sideways’ failure of proof. We thus affirm the court’s determination that the

patents have not been shown to be invalid.

      III.   Contract Disputes

      We have considered Landers’ remaining arguments on appeal, including those

supporting its appeal of the district court’s grant of summary judgment denying Landers’

claim for expenses that it incurred in the Howell litigation, and we find them not

persuasive. We have also considered Sideways’ remaining arguments on cross-appeal,

including those supporting its cross-appeal of the court’s decision holding Sideways

liable for the cost of replacement equipment, and we find them not persuasive as well.

Thus, the district court’s decision on these appealed issues arising from the license

agreement is affirmed.

                                        COSTS

      Each party shall bear its own costs.

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