The U.S. Court of Appeals for the Federal Circuit affirmed the International Trade Commission's (ITC or Commission) final determination of infringement of three patents directed to a mechanism for coupling adjacent floor panels of laminate flooring without requiring permanent attachment (i.e., without use of adhesives and/or nails). Yingbin-Nature (Guangdong) Wood Industry Co. v. International Trade Commission, Case No. 07-1311 (Fed. Cir., July 31, 2008) (Michel, C.J.).
Unilin Beheer B.V. Flooring Industries, Ltd. (Unilin) filed a complaint with the ITC, under 19 U.S.C. § 1337(a)(1)(B) § 337, alleging that Power Dekor Group Co. Ltd., Yingbin-Nature Wood Industry Co., Jiangsu Lodgi Wood Industry Co. (collectively Power Dekor) and several other companies imported and sold laminate floor panels that infringed certain claims of Unilin's patents. Following an investigation, the presiding administrative law judge (ALJ) concluded that the Power Dekor accused products did not infringe certain of the asserted claims (the lower lip claims); that other claims (the clearance claims) are invalid for lack of written description support; and each of the Power Dekor accused products infringed certain other claims (the snap action claims).
The Commission reviewed the ALJ's Initial Determination (ID) in part and reversed the ALJ's conclusions as to the first two issues, concluding that the Power Dekor accused products did infringe the lower lip claims; and the clearance claims satisfied the written description requirement (and were therefore not invalid). The Commission took no position on the ALJ's findings that each of the Power Dekor accused products infringed one or more of the snap action claims. Thus, the ALJ's ID became the final determination of the Commission with respect to the snap action claims. Accordingly, the Commission terminated the investigation with a finding of violation of § 337 and entered a general exclusion order (GEO) excluding the Power Dekor accused products. Power Dekor appealed in-part the Commission's conclusions of Power Dekor's infringement of the lower lip claims and upholding the validity of the clearance claims.
Prior to oral argument, the Federal Circuit requested that the parties brief the issue of whether Power Dekor appeal to the Federal Circuit was moot because the accused Power Dekor products all infringe at least one of the snap action claims and the GEO is supported by the infringement of those claims. At oral argument, Unilin contended that the appeal was moot because even if the Federal Circuit agreed with Power Dekor on its issues with respect to infringement of the lower lip claims and validity of the clearance claims, Power Dekor's accused products would still be excluded from the United States based on the unappealed finding by the Commission that those products infringe the snap action claims.
Power Dekor and the Commission argued that the appeal was not moot. Power Dekor contended that the controversy on appeal was not whether the seven Power Dekor products found to infringe would be excluded from importation, but rather related to the scope of the GEO that affects the type of products that Power Dekor will be permitted to import in the future. According to Power Dekor, based on the ITC rulings, it will import products that, under the Commission's rulings, do not infringe the snap action claims, but would infringe the lower lip claims (i.e., products similar to Respondent Vohringer's "Lock 7" product) and the clearance claims (i.e., products similar to Respondent Yekalon's "Engagement 2" product). Essentially, Power Dekor argued that under the Commission's rulings, it would be collaterally estopped from arguing in future proceedings, whether before Customs or the Commission, that products similar to the "Lock 7" and "Engagement 2" products do not infringe the lower lip claims. The Commission agreed with Power Dekor that the appeal was not moot because there is a live controversy about the scope of the GEO.
Power Dekor also contended that the clearance claims are invalid for lack of adequate written description in the originally-filed disclosure of the concept of "clearances." Power Dekor argued that the concept of "clearances" was introduced as new matter in the application leading to the patent through alterations to 14 paragraphs, the introduction of new reference numbers in certain figures and the addition of two completely new paragraphs. Power Dekor also contended that the Commission was incorrect in concluding that the patentee merely introduced the word "clearances" as a generic term that encompasses the "recesses," "chambers/dust chambers" and "spaces/intermediate spaces" that were disclosed in the original disclosure. Power Dekor argued that those three terms were used in the original disclosure to describe three different types of spaces and that nothing in the original disclosure indicates to one of ordinary skill that those terms can be treated the same. The Commission and Unilin responded that the Commission's conclusions regarding validity were supported by substantial evidence. They also contended that merely adding the generic word "clearance" to describe those spaces did not constitute new matter and that there is nothing improper about using the term "clearance" in two different ways within the patent.
The Federal Circuit held that Power Dekor's challenge to the validity of the clearance claims was not moot. However, the Federal Circuit concluded that the portion of Power Dekor's appeal regarding infringement of the lower lip claims was moot because the exclusion of the Power Dekor products was supported by the unappealed Commission decision finding that those products infringed the snap action claims. Thus the Court reasoned that any injury caused by the exclusion of those products could not be redressed by any Federal Circuit determination on the lower lip claims. The Federal Circuit also concluded that there was no showing that collateral estoppel would apply to Power Dekor's future products because the Commission's factual findings regarding the "Lock 7" and "Engagement 2" products are only preclusive as to Vohringer and Yekalon, respectively.
On review of the validity of the clearance claims, the Federal Circuit agreed with the Commission and Unilin that the Commissions conclusion regarding validity was supported by substantial evidence. The Federal Circuit also found that the term "clearances" was supported by the originally filed disclosure.
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