Panduit Corp. v. Hellermanntyton Corp.

Citations: 451 F.3d 819; 79 U.S.P.Q. 2d (BNA) 1053; 2006 U.S. App. LEXIS 14383; 2006 WL 1586327Docket: 2005-1337

Court: Court of Appeals for the Federal Circuit; June 12, 2006; Federal Appellate Court

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Panduit Corporation appeals a dismissal of its claims against HellermannTyton Corporation, following a summary judgment that HellermannTyton did not breach a Settlement Agreement related to U.S. Patent No. 5,998,732. The case was decided by the United States Court of Appeals for the Federal Circuit on June 12, 2006, after being appealed from the Northern District of Illinois. The court, led by Circuit Judge Linn, affirmed the lower court's decision, stating there were no genuine issues of material fact and that HellermannTyton was entitled to judgment as a matter of law.

The ’732 patent pertains to a “modular offset power box and communication extension” designed for multi-channel power and communication wiring systems used in office buildings. These systems facilitate the installation of power outlets and communication lines, allowing for flexible adjustments to accommodate changing business needs or technological advancements. The invention aims to simplify the routing of power conductors into the power box while keeping them isolated from communication channels, thus preventing interference and expediting installation.

Claim 1 describes a modular raceway outlet station featuring an offset power box designed for integration with a trunking duct, which includes specific structural elements. The offset power box has a top wall, lateral projection, and an abutment portion that aligns with the duct's top access opening. An opening in the projection connects with an aperture in the box’s side wall, allowing electrical wires to pass into the duct. The preferred embodiment illustrates these components, including the installation of a power outlet within the box. In 2001, Panduit filed a lawsuit against HellermannTyton for infringing the ’732 patent due to their product, the MCR-SEB. A Settlement Agreement was reached, prohibiting HellermannTyton from selling defined "Subject Products," which included the MCR-SEB and any products covered by the patent. Panduit waived prior infringement claims in exchange. In 2003, Panduit sued HellermannTyton again for breach of this Agreement and for infringement regarding a revised design, differing only in that the wall adjacent to the duct was solid. The district court stayed the infringement litigation pending a reexamination at the USPTO but allowed the breach of contract claim to move forward.

On August 10, 2004, the district court interpreted various limitations of claim 1 related to a patent, including definitions of "projection," "abutment portion," "opening," and "aperture formed in a side wall." On February 9, 2005, the court granted HellermannTyton's motion for summary judgment on a contract claim, determining that the accused device did not match the previous design under section 1(b)(i) of the Agreement, rejecting Panduit's argument of material similarity. The court ruled that the accused device did not infringe the ’732 patent, either literally or under the doctrine of equivalents, thus not breaching section 1(b)(ii) of the Agreement. The court noted that the accused device lacked the "projection," "abutment portion," and "opening" limitations, but did not address the "aperture formed in a side wall" limitation. A final order was issued, resolving all claims, and Panduit appealed, challenging the summary judgment regarding the alleged breaches of the Agreement. The appellate court has jurisdiction under 28 U.S.C. 1295(a)(1). The standard of review for the summary judgment grant is de novo, applying Seventh Circuit law, which stipulates that summary judgment is only appropriate if no genuine issues of material fact exist. The interpretation of the Agreement is governed by Illinois law, which treats contract interpretation as a legal question subject to de novo review, while infringement issues are factual determinations.

Infringement under the doctrine of equivalents is constrained by prosecution history estoppel and the “all elements” rule, both of which are legal questions. The district court ruled that Panduit did not dispute that the accused product is not physically the same as Part No. MCR-SEB, thus HellermannTyton was granted summary judgment for not breaching the Agreement’s clause 1(b)(i) which defines “Subject Product” as Part No. MCR-SEB. Panduit argued that prior case law (Foster v. Hallco and KSM Fastening Systems) warranted a broader interpretation that could include “colorably different” products. However, HellermannTyton contended that these cases were distinguishable due to the lack of an adjudication on the merits and no injunction or consent judgment being in place, asserting that the "insubstantial differences" doctrine was not applicable. The court found that the Agreement explicitly addressed Part No. MCR-SEB, making it distinct from the precedents cited. Under Illinois law, the clear language of the Agreement prevails. The court concluded that clause 1(b)(i) pertains only to the specific product Part No. MCR-SEB, rejecting Panduit's interpretation that it encompassed devices with minor differences.

The Agreement's language is clear, specifically stating in section 1(b)(i) that it only pertains to Part No. MCR-SEB, excluding any changes or variations. Settlement agreements represent compromises in legal disputes, and consent decrees arise from thorough negotiations. Since the Agreement's terms are unambiguous, the parties' intent regarding absent terms is irrelevant. The district court correctly interpreted section 1(b)(i) as exclusively including Part No. MCR-SEB and ruled that the accused device does not qualify as a “Subject Product” under this definition. Panduit did not contest that the accused device is not the same as Part No. MCR-SEB, and the modifications made to the accused device by HellermannTyton eliminate its similarity. 

In section 1(b)(ii), the district court found that the accused device did not infringe the ’732 patent, as it lacked the “opening, projection, and abutment portion” limitations. Panduit challenged this ruling, claiming the limitations were present in their Figure 3. However, the court concluded that the accused device does not meet the “opening” limitation criterion, justifying the summary judgment without needing to address other disputed terms. The court clarified that the “opening” must be located in the descended portion of the abutment and not at the top. It emphasized that while the patent allows flexibility in the width of the opening, it must not be so wide that the abutment portion loses its structural integrity. The district court ruled that the alleged opening in the accused product does not satisfy the requirement of being "formed in" the abutment portion. Panduit countered that the claims do not necessitate a descending opening and argued for a broader interpretation of “formed in,” while HellermannTyton maintained that the opening must extend from the top of the projection.

HellermannTyton contends that Panduit's interpretation of an "opening" is incorrect, arguing it does not exist in a hanging part of the structure, as there is no supporting element for the abutment portion. HellermannTyton emphasizes that the horizontal structure and two shaped surfaces are not co-planar, thus an "opening formed in" the abutment cannot be established. The determination of the claim limitation's meaning relies on intrinsic evidence, including claim language, written description, and prosecution history.

The claim stipulates that an "opening" must be in an abutment portion of the projection, which is defined as depending from the top portion of the projection. Both parties agree that this implies the abutment must hang down from the top portion. Thus, for an opening to be "formed in" the abutment, it must be in a downward-extending area. Additionally, the claim necessitates that the opening be “in communication” with an aperture in the side wall, interpreted as a passage for routing wires.

HellermannTyton supports this interpretation with the written description and asserts that, despite the preferred embodiment not showing a bounded top for the aperture, the definition of an abutment portion consistently indicates that it must extend downward. The prosecution history aligns with this understanding.

Upon comparing the construed claim with Panduit's accused device, HellermannTyton concludes that neither of Panduit's openings satisfies the claim's requirements. The first set of openings, while in an abutment portion, does not allow wires to pass into the side wall's aperture, failing the "in communication" requirement. The second opening, an open space between shaped surfaces, also does not extend downward from the projection's top and therefore cannot be considered "formed in" the abutment portion. Even if the horizontal surface were deemed part of the abutment, it would still not meet the claim's limitations, as it would be located above the top portion of the projection. Consequently, the district court's finding that there is no genuine issue of material fact regarding non-infringement of the ’732 patent is upheld.

The doctrine of equivalents is inapplicable due to the "all elements rule," which states that it cannot be used if it would eliminate an entire claim limitation. In this case, Claim 1 of the ’732 patent mandates an opening in an abutment portion for wires to pass from a trunking duct into an offset power box. If the claim were extended to include a device where wires bypass the abutment, it would effectively remove the “opening” limitation from the claim. Thus, the doctrine cannot be applied, leading to the conclusion that the accused device does not infringe Claim 1 of the ’732 patent. Consequently, the district court correctly granted summary judgment, ruling that the accused device is not a “Subject Product” under the Agreement. The court affirmed that there is no genuine issue of material fact regarding the accused device's compliance with the Agreement, confirming that HellermannTyton did not breach the Agreement.