Broad Range In Prior Art Anticipates Narrow Range In Claims

Last Month at the Federal Circuit - March 2012

Judges: Prost, Schall, Moore (author)

[Appealed from E.D. Tex., Judge Davis]

In ClearValue, Inc. v. Pearl River Polymers, Inc., Nos. 11-1078, -1100 (Fed. Cir. Feb. 17, 2012), the Federal Circuit reversed the district court's denial of ClearValue, Inc. and Richard Alan Haase's (collectively "ClearValue") motion for JMOL that the patent-in-suit was anticipated by the prior art. The Court also affirmed the district court's grant of JMOL that Pearl River Polymers, Inc., Polychemie, Inc., SNF, Inc., Polydyne, Inc., and SNF Holding Company (collectively "Pearl River") did not misappropriate ClearValue's trade secret.

U.S. Patent No. 6,120,690 ("the '690 patent") is directed to a process for clarifying water with alkalinity below 50 ppm using a combination of a high-molecular-weight polymer and an aluminum polymer. ClearValue alleged that Pearl River indirectly infringed the '690 patent by selling high-molecular-weight polymers, which customers used with aluminum polymers to clarify low alkalinity water. ClearValue also alleged that Pearl River misappropriated a trade secret covering a water-clarification process like that of claim 1.

Pearl River argued that a prior patent, the Hassick reference, anticipated the '690 patent because it taught the use of a blend of a high-molecular-weight polymer and an aluminum polymer to clarify water with alkalinity less than 150 ppm. Hassick included examples, including one with water alkalinity of 60-70 ppm.

The jury found Pearl River liable for induced and contributory infringement, and the district court denied Pearl River's motions for JMOL of noninfringement and invalidity. The jury also found that Pearl River misappropriated ClearValue's Trade Secret #1. The district court, however, granted Pearl River's motion for JMOL of no trade secret misappropriation, finding that the prior art disclosed every element of the trade secret before any alleged misappropriation by Pearl River.

On appeal of the invalidity issue, ClearValue first argued that Pearl River waived its invalidity defense by including them in its motion under Fed. R. Civ. P. 50(b), but not in its motion under Fed. R. Civ. P. 50(a). Following Fifth Circuit law, the Federal Circuit held that Pearl River was not barred from presenting its invalidity arguments because ClearValue did not raise waiver in opposing Pearl River's Rule 50(b) motion. Moreover, the Federal Circuit determined that the district...