Opinion
Cause No. 3:04-CV-637 JTM.
September 1, 2005
REPORT AND RECOMMENDATION ON PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION
Plaintiff Hickory Springs Manufacturing Company, a manufacturer of recreational vehicle ("RV") steps, filed this action on October 7, 2004, alleging that Defendant infringed its patented parallelogram linkage system which is the subject of U.S. Patent 6,082,751 (the "751 patent"). On April 6, 2005, Plaintiff filed a motion for preliminary injunction to enjoin Defendant's alleged infringement of Claim 1 and Claim 9 of the '751 patent. Pursuant to 28 U.S.C. § 636(b)(3), this matter was referred to the undersigned to conduct such proceedings as are required and enter into the record proposed findings of fact and conclusions of law on Plaintiff's motion for preliminary injunction. On June 1, 2005, this Court held an evidentiary hearing regarding Plaintiff's alleged irreparable harm. On July 20, 2005, this Court conducted a two-day evidentiary hearing on the issue of likelihood of success on the merits. At the conclusion of the hearing, this Court ordered both parties to submit proposed findings of fact and conclusions of law. Parties have since complied with this Court's order and this Court now enters into the record its proposed findings of fact and conclusions of law.
I. PRELIMINARY MATTERS
In its motion for preliminary injunction, Plaintiff initially asserted that Defendant infringed Claim 9 of the '751 patent. However, during the evidentiary hearing held on July 20, 2005, Plaintiff voluntarily withdrew its motion as it pertained to Claim 9. Therefore, this Court RECOMMENDS that Plaintiff's motion for preliminary injunction as to Claim 9 of the '751 patent be DENIED AS MOOT.
II. FINDINGS OF FACT
Most RVs sit higher off the ground than the conventional automobile, requiring either a two or three-step RV step to assist passenger ingress to and egress from the RV. Early models of manual RV steps relied on a sliding rivet that moved within two slots on the side plates of the frame. When the steps were extended from the storage area to facilitate ingress and egress, the steps had to be pulled evenly from both ends of the frame in order to ensure that the rivet on each side plate of the frame would slide evenly through the slots. Failure to pull the steps in an even manner often resulted in the steps becoming wedged or stuck, and thus, disabled for use. Consequently, pre-existing manual RV steps were often very difficult to operate.
Almost ten years ago, Plaintiff developed a new mountable manual RV step unit. Allen Williams and Fred Hanes, two of Plaintiff's engineers, developed a RV step, the operation of which featured a parallelogram arrangement of linkages for extending and retracting the step tread or treads from the frame of the structure. By replacing the rivet with a parallel arrangement of linkages, Plaintiff effectively circumvented the disadvantages associated with existing manual RV steps. The parallel linkage arrangement facilitated even movement of the steps between the retracted and extended positions and allowed users to extend the steps using only one hand. In addition to the parallelogram linkage system, Plaintiff's scissor step was comprised of a step tread which was mounted to separate end brackets that were located at the end of the step tread. The end brackets were mounted to extension brackets that were located on the sides of the step structure.
Parties referred to the new genre of the manual RV steps as scissor steps. This Court will use the same reference.
Plaintiff introduced its scissor steps, which came in either one, two, or three step units, into the market in 1996. Although the steps sold at levels approximately eighteen percent higher than the then-current market prices for other RV steps, the steps were well-received by customers. Transcript of June 1, 2005 Hearing (Thayer Testimony), p. 152. After only a year on the market, Plaintiff had captured approximately ninety percent of the three step market. From 1997 to 2004, Plaintiff increased its overall sales of the scissor steps by 550%. In addition, between 1998 and 2004, Plaintiff increased its market share of the triple step RV steps to ninety-eight percent. Transcript of July 20-21 Hearing (Thayer Testimony), pg. 251-3. Due to the success of the scissor steps, Plaintiff applied for a patent. On July 4, 2000, the U.S. Patent Trademark Office ("PTO") issued the '751 patent which covered Plaintiff's scissor steps.
Although Plaintiff was the predominant manufacturer and seller of the scissor steps, from May 2002 through February 2004, Zieman Manufacturing Company ("Zieman"), a producer of various RV chassis components, sold approximately 2,100 scissor steps in which it had imported from India. On May 4, 2004, Defendant acquired Zieman. Defendant, the largest manufacturer of steel chassis and components for RVs, had been Plaintiff's customer for approximately seven years and had purchased approximately $806,500 a year worth of Plaintiff's scissor steps between 2002 and 2004. After acquiring Zieman, Defendant made a few modifications to Zieman's scissor steps. Unlike Plaintiff's scissor steps, Defendant's modified scissor step did not contain distinct separate end brackets on the sides of the step tread. Rather, the ends of Defendant's step treads are turned down, creating an integral flange. The integral flange is attached to the extension brackets that are located on the sides of the step structure. Defendant began selling its modified scissor steps, which it still imported from India, around July or August 2004. Defendant's scissor steps cost approximately seven to fifteen percent less than Plaintiff's scissor steps.
After Defendant introduced its scissor steps, Plaintiff's market share for the three step scissor step fell from ninety percent in November 2004 to less than seventy-five percent in March 2005. Thayer Decl. ¶ 15. In addition, Plaintiff's monthly revenue decreased by more than thirty percent since January 2005. Thayer Decl. ¶ 15. Plaintiff believes that its revenues will continue to decrease. Furthermore, Plaintiff contends that there have been quality control issues which have caused customer confusion regarding who is the manufacturer of a particular set of steps. Thus, Plaintiff filed its motion for preliminary injunction.
III. CONCLUSIONS OF LAW
A. Legal Standards
A preliminary injunction in a patent infringement case is a drastic and extraordinary remedy that is not to be routinely granted. Nat'l Steel Car, Ltd. v. Canadian Pacific Railway, Ltd., 357 F.3d 1319, 1324 (Fed. Cir. 2004). A plaintiff must prove four factors before a court may grant a preliminary injunction. Those factors are: 1) a likelihood of success on the merits; 2) the threat of irreparable harm in the absence of injunctive relief; 3) the balance of hardships favors the grant of injunctive relief; and 4) the grant of injunctive relief will not adversely affect the public interest. Oakley, Inc. v. Sunglass Hut Int'l, 316 F.3d 1331, 1338-39 (Fed. Cir. 2003). While none of these factors alone is dispositive, a court cannot grant a preliminary injunction unless a plaintiff establishes both a reasonable likelihood of success on the merits and the threat of irreparable harm. Anton/Bauer, Inc. v. PAG, Ltd., 329 F.3d 1343, 1348 (Fed. Cir. 2003).
To prove a likelihood of success on the merits a plaintiff must prove, in light of the burdens that will inhere at trial, that it will likely prove infringement at trial and that any challenges to the validity of the patent lack substantial merit. Id. In proving infringement, one must first interpret the claim and determine the scope and the meaning of the claim. The construed claim must then be compared against the alleged infringing product. Liquid Dynamics Corp. v. Vaughan Co., 355 F.3d 1361, 1367 (Fed. Cir. 2004). For there to be literal infringement, each and every feature of the patent's claims must be present. Id. at 1369. A court need not definitely define the claims at the preliminary injunction stage, but must preliminary construe the claim in order to determine whether the product infringes on the patent. Purdue Pharma L.P. v. Boehringer Ingelheim GmbH, 237 F.3d 1359, 1363 (Fed. Cir. 2001).
In construing the claims of a patent, the "bedrock principle" of patent law is that "the claims of the patent define the invention to which the patentee is entitled the right to exclude." Phillips v. AWH Corp., No. 03-1269, 2005 U.S. App. LEXIS 13954, at *20 (Fed. Cir. July 12, 2005). The words of a claim "are generally given their ordinary and customary meaning."Id. at *22. However, the ordinary and customary meaning of a word is the meaning that a person of ordinary skill in the art in question at the time of the invention would have given the term.Id. Generally, a person of ordinary skill is deemed to read the claim term not only in the context of the particular claim in which the disputed term appears, but in the context of the entire patent, including the specification. Id. See also Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed. Cir. 1996) (holding "the court should look first to the intrinsic evidence of record, i.e., the patent itself, including the claims, the specification, and if in evidence, the prosecution history.").
B. Analysis
The first factor this Court must examine is whether Plaintiff has proven a likelihood of success on the merits. Although this Court need not definitely construe the '751 patent's claims at this stage of the proceedings, this Court must make a preliminary construction in order to determine whether Defendant's scissor steps infringe on Plaintiff's patent. Claim 1 of the '751 patent recites:
An extendable and retractable step structure mountable to a recreational vehicle for facilitating ingress thereto and egress therefrom, the step structure comprising
• a frame defining a step storage area for mounting to the vehicle beneath a passenger ingress-egress location,
• at least one step tread mounted between end brackets, and
• a movable linkage arrangement supporting the step tread from the frame for controlling movement thereof between a retracted position wherein the step tread and the linkage arrangement are withdrawn into the step storage area of the frame and an extended position wherein the step tread and the linkage arrangement are extended outwardly from the frame for use by passengers to obtain ingress and egress to and from the vehicle, the linkage arrangement comprising
• an extenion [sic] bracket at opposite ends of the step tread and
• a parallelogram arrangement comprising respective pairs of primary support links pivotably connected between opposite ends of the frame and the extension bracket.
As both parties acknowledged at the hearing and in their post-hearing submissions, the only portion of the claim that needs to be construed is the element that requires that there be "at least one step tread mounted between end brackets." Defendant's own expert, Dr. David Parks, testified at the hearing that Defendant's scissor steps probably embody all of the remaining elements. Thus, this Court will limit its construction to the phrase "mounted between end brackets." When construing this phrase, the ultimate question this Court must decide is whether an integral flange fits within the description "mounted between end brackets." This Court concludes that it does not.
Using the plain language in the claim, Plaintiff's expert, Dr. Henry Stoll, testified that "bracket" is a support member which provides the opportunity to attach or provide attachment locations and "mounted" means attached or connected to a support. Dr. Stoll further opined that it does not matter how a bracket is attached to a structure in order for it to be a bracket. Thus, Dr. Stoll concluded that Defendant's integral flange constitutes an end bracket, and therefore, the step tread was mounted, by way of the integral flange, between end brackets. However, in Dr. Stoll's April 25, 2005 deposition, he stated that the patent's claim required three separate features, a step tread, end brackets, and extension brackets. Furthermore, in his deposition, Dr. Stoll indicated that he had never before used the word mounted when referring to integral flanges, nor did he think that in the business of manufacturing steel steps, a mechanical designer would use the word "mounted" to describe an integral flange.
Defendant's expert, Dr. Parks, testified that according to the claim's plain language, the structures must be separate and could be attached by bolting, riveting, welding, etc. Dr. Parks concluded that an integral flange does not fit within the ordinary meaning of "mounted between." Plaintiff's specification supports Dr. Parks' construction. The specification states
[t]he step tread 14 in the present structure is fabricated as a flat elongate metal plant of rectangular configuration to present an upwardly facing tread surface 24, with integral front and back flanges 26 and riveted end brackets extending downwardly in perpendicular relation from the respective edges of the tread surface to facilitate connection of the step tread to the linkage system. (Emphasis added).
Plaintiff's specification illustrates that Plaintiff contemplated separate end brackets by using the word riveted. Furthermore, Plaintiff adequately described the use of front and back flanges. If Plaintiff had intended "mounted between end brackets" to incorporate integral side flanges, Plaintiff could have used more specific language in the specification. Thus, the silence of the words side flange and the use of riveted end brackets tends to support Dr. Parks claim construction.
Therefore, the plain language of the claim and the patent's specification provide this Court with adequate information to preliminary construe the claim. Because Dr. Stoll had previously testified that he probably was not using the term "mounted" consistent with how he would typically use it, this Court finds Dr. Stoll's claim interpretation unpersuasive. However, Dr. Parks claim construction is supported by the patent specification. Thus, this Court finds that the ordinary and customary meaning of the term "mounted" to a person of ordinary skill in the art means attached or affixed, whether by using rivets, bolts, screws, or by welding or some other manner of fastening one thing to another. Furthermore, the '751 patent requires three separate features, a step tread, end brackets, and extension brackets. Because Defendant's integral flanges are not separate end brackets which the step tread was mounted between by either rivets, bolts, screws, or welding, this Court concludes that Plaintiff has not provided sufficient evidence at this time to establish that Defendant's scissor steps infringed Plaintiff's patent.
Even if Plaintiff had been able to prove a likelihood of success on the merits, this Court has serious reservations that Plaintiff could establish irreparable harm. The majority of the testimony on the irreparable harm issue related to lost units of sales. Lost sales are calculable damages and do not constitute irreparable harm. Consequently, this Court recommends that Plaintiff's motion for preliminary injunction be denied.
IV. ANCILLARY MATTERS
Plaintiff also asserted a second theory of infringement, namely that Defendant used spacers between the flanges and the extension brackets, which constitutes a separate end bracket. Defendant asserted that the spacers were used because some of the step treads were smaller than the other step treads and the spacer allowed Defendant to reduce the number of unique step treads it had to manufacture. Defendant notified this Court at the hearing that as of July 21, 2005, Defendant had notified its supplier that it must stop manufacturing the steps with the spacers. In Defendant's post-hearing submission, it again assured this Court that as of July 21, 2005, it no longer manufactured scissor steps with the spacer. Thus, because Defendant's scissor steps no longer contain the spacer which Plaintiff alleged constituted an infringement, Plaintiff's second infringement theory is moot for the purposes of a preliminary injunction.
Because Defendant contends that it only learned of Plaintiff's second infringement theory at the hearing, on July 21, 2005, Defendant filed a motion to strike evidence related to Plaintiff's second theory. However, because this Court did not rely on Plaintiff's second argument since the issue, as it relates to a preliminary injunction, is now moot, Defendant's motion to strike [Doc. No. 55] is DENIED.
V. CONCLUSION
For the aforementioned reasons, this Court RECOMMENDS that Plaintiff's motion for preliminary injunction [Doc. No. 18] be DENIED IN PART AS MOOT and DENIED IN PART. Specifically this Court RECOMMENDS that the court DENY AS MOOT Plaintiff's motion as it relates to Claim 9 of the '751 patent and DENY Plaintiff's motion as it relates to Claim 1 of the '751 patent. In addition, this Court DENIES Defendant's motion to strike [Doc. No. 55].
NOTICE IS HEREBY GIVEN that within ten (10) days after being served with a copy of this recommended disposition a party may serve and file specific, written objections to the proposed findings and/or recommendations. Fed.R.Civ.P. 72(b). FAILURE TO FILE OBJECTIONS WITHIN THE SPECIFIED TIME WAIVES THE RIGHT TO APPEAL THE DISTRICT COURT'S ORDER.
SO ORDERED.