Last week, the U.S. Court of Appeals for the Federal Circuit issued an order in John Bean Technologies Corp. v. Morris & Associates, Inc., Nos. 20-1090, -1148 (Feb. 19, 2021), affirming a district court’s decision as to equitable intervening rights.
In 2002, a patent directed to an auger-type poultry chiller for use in poultry processing issued to John Bean. Shortly thereafter, a competitor, Morris, wrote a demand letter to John Bean explaining its belief that the patent was invalid. Morris received no response and proceeded to develop and sell chillers that included the patented features. In 2013, John Bean sought ex parte reexamination of its patent. During reexamination, John Bean amended existing claims and added new claims. A reexamination certificate issued in 2014, and John Bean sued Morris for patent infringement shortly after.
Morris moved for summary judgment on laches and equitable estoppel. The motion was granted, and on a first appeal the Federal Circuit reversed and remanded. On remand, Morris again moved for summary judgment, this time asserting John Bean’s claims were barred by equitable intervening rights and prosecution laches. The district court denied the motion as to prosecution laches, holding that doctrine applies only to a patent applicant’s conduct before the patent’s issuance, not to later conduct such as initiation of reexamination. The district court granted the motion, however, as to equitable intervening rights. John Bean appealed, and Morris cross appealed.
On appeal, the Federal Circuit affirmed the judgment on intervening rights and, therefore, declined to reach the issue of prosecution laches. The Court explained equitable intervening rights is a matter of judicial discretion. Where applicable, the doctrine allows an infringer to “continue what would otherwise be infringing activity after a reissue or reexamination.” Reviewing the district court’s decision for abuse of discretion, the Court rejected John Bean’s argument that a positive finding on one of the several relevant factors—the infringer’s monetary recoupment of investments made prior to issuance of new or amended claims—alone is sufficient to defeat the grant of the equitable remedy. The Court explained “recoupment is not the sole objective of § 252’s protection of ‘investments made or business commenced’ before the claims’ alteration.” The Court also rejected John Bean’s assertion that genuine issues of material fact remained as to willful infringement, explaining that if there is no infringement, then there can be no willful infringement.