Court Opinion

ID: 9478679
Source: CourtListenerOpinion
Date Created: 2023-08-05 06:54:44.749302+00
Date Added: 2024-06-11T17:46:33.123665
License: Public Domain

NICHOLS, Senior Circuit Judge,
concurring in part and dissenting in part.
I dissent from the holding that the case is moot because of settlement and that the decision of the district court is not required to be vacated. I concur that the present case is moot on the basis that Patlex is the dominus litis on both sides of the litigation.
Patlex has made the argument that “[i]n subsequent litigation, other infringers of Patlex’s patents are certain to rely on Blonder-Tongue [Laboratories v. University of Illinois Foundation, 402 U.S. 313, 91 S.Ct. 1434, 28 L.Ed.2d 788 (1971)] to claim that the jury’s finding [of invalidity] in this case is entitled to collateral estoppel effect. Thus, if Patlex is unable to achieve reversal, it faces the possibility that it will be forever foreclosed from asserting these claims.”
I think that it would be eminently unfair to leave the trial court’s judgment undisturbed and permit future accused infring-ers to raise the Blonder-Tongue collateral estoppel argument. Admittedly, Blonder-Tongue, by its own terms, does not give collateral estoppel effect to judgments of patent invalidity from earlier litigation where the patentee did not have a fair opportunity to litigate the validity of his patent. Blonder-Tongue, 402 U.S. at 332-34, 91 S.Ct. at 1439-40. But what constitutes a fair opportunity? The Blonder-Tongue decision identifies a number of factors relevant to this determination, but concludes that “no one set of facts, no one collection of words or phrases, will provide an automatic formula for proper rulings on estoppel pleas.” Blonder-Tongue, 402 U.S. at 333-34, 91 S.Ct. at 1445.
The Blonder-Tongue issue is of speculative effect until any subsequent litigation is undertaken. In Hall v. U.S. Fiber & Plastics Corp., 476 F.2d 418 (3d Cir.1973), the court rejected Blonder-Tongue considerations as a reason for deciding an otherwise moot appeal, but I am not urging we decide such an issue, only that we vacate a decision below that there decided a moot issue our majority would leave standing. Nonetheless, the present appeal has seen the vigorous participation of three amici curiae, all members of the laser industry to which the subject patent is relevant.
This court and its predecessors have never squarely faced the question of whether the inability to obtain appellate review necessarily falls short of a fair opportunity to litigate. The Restatement (Second) of Judgments § 29 (1982) provides:
§ 29. Issue Preclusion in Subsequent Litigation with Others
A party precluded from relitigating an issue with an opposing party, in accordance with §§ 27 and 28, is also precluded from doing so with another person unless the fact that he lacked full and fair opportunity to litigate the issue in the first action or other circumstances justify affording him an opportunity to relitigate the issue. The circumstances to which *1396consideration should be given include those enumerated in § 28.
Among the circumstances listed in section 28 is the circumstance that:
(1) The party against whom preclusion is sought could not, as a matter of law, have obtained review of the judgment in the initial action.
The Restatement also takes the position, however, that “[w]ith respect to controversies that have become moot, it is a procedural requirement in some jurisdictions, in order to avoid the impact of issue preclusion, that the appellate court reverse or vacate the judgment below and remand with directions to dismiss.” Restatement (Second) of Judgments § 28 comment a (1982). In general, efforts to escape Blonder-Tongue collateral estoppel have not been met with success. See generally, 4 D. Chisum, Patents § 19.02[2], n. 12 (1988).
While we need not resolve the Blonder-Tongue issue now pressed, we should be conscious of it in deciding this case. I am convinced that our own precedent requires us to vacate the invalidity judgment, for reasons discussed infra, thus bypassing the Blonder-Tongue issue because it affords us no clear answer.
The majority reasons that the present case is moot because of settlement. The majority rests its analysis on the following syllogism: settlement moots an action; the present action was settled; therefore the present action is moot. A flaw in this syllogism is that it allows no room for the possibility of partial settlement.
If there is a partial settlement, there remains a case or controversy as to those issues which are not settled and not inherently mooted by the settlement. Cf. CTS Corp. v. Dynamics Corp. of America, 481 U.S. 69, 107 S.Ct. 1687, 1644, n. 5, 95 L.Ed.2d 67 (1987) (partial settlement does not moot the case because the judgment may still affect the parties’ rights). See generally Wright, Miller & Cooper, Federal Practice and Procedure: Jurisdiction 2d § 3533.2 at 234 (1984). Patlex argues, in effect, that it did not settle the issues of the validity of claims 1, 6, 8, and 10. Pat-lex’s brief states that: “[t]he settlement agreement did not address or affect the jury’s finding that claims 1, 6, 8, and 10 were invalid. However, in the agreement, Patlex reserved its right to attack those findings through a motion for judgment notwithstanding the verdict and then an appeal.”
Clearly, if the issues were not in fact settled, the majority’s conclusion of mootness on this basis cannot stand. Amici and the majority leap to the conclusion that these issues were settled, notwithstanding Patlex’s assertions to the contrary, without examining the document which purportedly expresses the settlement and moots the appeal. Patlex represents that it did not settle the issue of these claims’ validity, and we have no basis for challenging this statement. We cannot accept or reject this contention blindly; if our decision is to rest upon belief or disbelief of this premise, resort to the settlement agreement, in un-redacted form, is required.
Despite the foregoing, I believe that the case is moot for other reasons and that resort to the settlement agreement is inappropriate and unnecessary. Specifically, I concur in the majority’s holding that Patlex has the ability to control both sides of this litigation and that this ability removes the heretofore presence of a case or controversy. Although there was a genuine controversy at the onset of the litigation, the controversy must continue throughout the litigation. See, e.g., United States Parole Commission v. Geraghty, 445 U.S. 388, 397, 100 S.Ct. 1202, 1209, 63 L.Ed.2d 479 (1980). Because there is no longer a controversy by virtue of the common control of the parties, I agree that the case is moot. See, e.g., American Wood-Paper Co. v. Heft, 75 U.S. (8 Wall.) 333, 19 L.Ed. 379 (1869) (plaintiff and defendant to patent infringement action having come under common control, the case is moot).
While the majority shows, correctly, that full settlement of a case does not preclude subsequent entry of a consent judgment effectuating the settlement, I believe the rule should be otherwise when plaintiff and defendant pass under common control. In the former case, the judgment still serves *1397the ends of justice as it precludes action by either party contrary to the judgment, and each party will be alert to move against a violation by the other. In the latter case, the court does not retain any control over anybody or thing, and the new commonly controlled entity can violate the judgment with impunity. I venture to state, therefore, that a consent judgment is improper if, as here, it purports to state the rights and duties of only the commonly controlled components of one new entity, toward one another. Such a judgment can now affect only the rights of persons not parties to it who had no voice in making it. It is improper and should be vacated.
It is the established procedure of this court to vacate an invalidity determination of a trial court if, on appeal, the accused devices are found noninfringing. Sun-Tek Industries, Inc. v. Kennedy Sky Lites, Inc. 848 F.2d 179, 183, 6 USPQ2d 2017, 2020 (Fed.Cir.1988); Advance Transformer Co. v. Levinson, 837 F.2d 1081, 1084, 5 USPQ2d 1600, 1603 (Fed.Cir.1988); Vieau v. Japax, Inc., 823 F.2d 1510, 1517, 3 USPQ2d 1094, 1100 (Fed.Cir.1987); Fonar Corp. v. Johnson & Johnson, 821 F.2d 627, 634, 3 USPQ2d 1109, 1114 (Fed.Cir.1987) cert. denied, — U.S.-, 108 S.Ct. 751, 98 L.Ed.2d 764 (1988); Teledyne McCormick Selph v. United States, 558 F.2d 1000, 1001, 214 Ct.Cl. 672, 195 USPQ 261, 262 (1977). Cf. Altvater v. Freeman, 319 U.S. 359, 363-65, 63 S.Ct. 1115, 1117-19, 87 L.Ed. 1450 (1943) (“to hold a patent valid if it is not infringed is to decide a hypothetical case”). The reasoning behind this practice is that in such situations the issues are moot and to decide them would be the unconstitutional rendering of an opinion where no case or controversy exists. Sun-Tek, 848 F.2d at 183, 6 USPQ2d at 2020.
In the present case, the judgment that Control Laser infringes claims 1-3 and 7-12 has become final, and the issue of infringement has been conclusively laid to rest. If the challenged district court judgment had laid the infringement issue to rest by finding Control Laser’s devices non-infringing, clearly we would be bound to vacate the holding of invalidity. Thus, the majority inferentially attaches significance to the fact that the infringement issue has been laid to rest other than by a finding of noninfringement.
I do not believe that the circumstances which make the validity issue a dead one control whether an unnecessary judgment of invalidity is to be vacated. This case was already moot when the trial court entered its final judgment and the judgment was therefore improperly entered. Where a judgment is rendered without an underlying controversy to support it, the judgment must be vacated, whether the lack of a controversy appeared after judgment and pending appeal, United States v. Munsingwear, Inc., 340 U.S. 36, 71 S.Ct. 104, 95 L.Ed. 36 (1950), or before entry of the trial court judgment, United States v. Johnson, 319 U.S. 302, 63 S.Ct. 1075, 87 L.Ed. 1413 (1943) (where litigation was collusive and lacked a true case or controversy at its inception, the trial court judgment is vacated). Accord Lord v. Veazie, 49 U.S. (8 How.) 251, 12 L.Ed. 1067 (1850), cited with approval in Cleveland v. Chamberlain, 66 U.S. (1 Black) 419, 17 L.Ed. 93 (1861).
In Jervis B. Webb Co. v. Southern Systems, Inc., 742 F.2d 1388, 222 USPQ 943 (Fed.Cir.1984), Webb asserted infringement of some of the claims contained in its patent. Southern counterclaimed for a declaratory judgment that all of the patent’s claims were invalid. The district court held that all of the claims were invalid for obviousness. On appeal, this court held not only that the case was moot on appeal, but that there was never at any time a case or controversy between the parties with regard to some of the claims invalidated by the district court. The validity of these claims was a moot issue at all stages of the litigation, including the trial level, as is the situation in the present case. “Since * * * the evidence in the record is inadequate to indicate the existence of a case or controversy regarding the remaining claims in the invalidity declaratory judgment counterclaim, we vacate that portion of the district court’s holding regarding the invalidity of [those claims].” Webb, 742 F.2d at 1399, 222 USPQ at 950.
*1398“The basis for the court’s decision to vacate in Webb was the inability of the declaratory plaintiff to meet the [case or controversy] requirement.” Vieau v. Japan, Inc., 823 F.2d 1510, 1520, 3 USPQ2d 1094,1102 (Fed.Cir.1987) (Bennett, S.J. concurring). The same operative circumstances are present here. Control Laser, the declaratory plaintiff, cannot now, and could not in the district court, meet the case or controversy requirement of article III of the Constitution.
Accordingly, under the principles announced in the case law of this court and that of the Supreme Court discussed above, I would vacate the district court judgment of invalidity.