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Swartz v. Sealed Power Corp.

United States District Court, M.D. Pennsylvania

January 25, 2018

KEVIN EUGENE SWARTZ, Plaintiff,
v.
SEALED POWER CORPORATION, et al, Defendants.

          BRANN, J.

          REPORT AND RECOMMENDATION

          KAROLINE MEHALCHICK, UNITED STATES MAGISTRATE JUDGE

         Before the Court are two motions for summary judgment: the first filed by pro se Plaintiff, Kevin Eugene Swartz (hereinafter "Swartz"), seeking partial summary judgment (Doc. 58); and the second filed by SPX Corporation ("SPX"), seeking summary judgment. (Doc. 60). Swartz moves for partial summary judgment on the grounds that he is the sole and exclusive owner of the patent at issue, United State Patent No. 7, 434, 679 (the "'679 Patent"). SPX moves for summary judgment on the grounds that their accused product does not infringe the '679 Patent.

         For the following reasons, the Court will GRANT SPX's Motion for Summary Judgment, and DENY Swartz's Motion for Partial Summary Judgment.

         I. Background and Procedural History

         As a preliminary matter, the Court recognizes that Swartz has failed to provide a concise statement of facts in support of his motion for partial summary judgment (Doc. 58) and in opposition to SPX's motion for summary judgment. (Doc. 63). Both constitute a violation of Local Rule 56.1, which provides in pertinent part:

         LR 56.1 Motions for Summary Judgment.

A motion for summary judgment filed pursuant to Fed.R.Civ.P.56, shall be accompanied by a separate, short and concise statement of the material facts, in numbered paragraphs, as to which the moving party contends there is no genuine issue to be tried.
The papers opposing a motion for summary judgment shall include a separate, short and concise statement of the material facts, responding to the numbered paragraphs set forth in the statement required in the foregoing paragraph, as to which it is contended that there exists a genuine issue to be tried.
Statements of material facts in support of, or in opposition to, a motion shall include references to the parts of the record that support the statements.

All material facts set forth in the statement required to be served by the moving party will be deemed to be admitted unless controverted by the statement required to be served by the opposing party.

Local Rule 56.1 (emphasis added).

         As such, the factual background is largely taken from SPX's Answer to Swartz's Statement of Facts[1] (Doc. 65) and SPX's Statement of Material and Undisputed Facts in support of its Motion for Summary Judgment. (Doc. 62). Further, to the extent Swartz has denied any facts in his Brief in Opposition to SPX's Motion for Summary Judgment (Doc. 63) and provided supporting citations to the evidentiary record, those objections are noted.[2] Otherwise, in accordance with Local Rule 56.1, the Court has deemed the facts in SPX's statement of material facts (Doc. 62) as admitted by Swartz. Such facts have been taken in the light most favorable to Swartz as the non-moving party, with all reasonable inferences drawn in his favor.

         The instant infringement claim stems from the '679 Patent filed by Swartz with the United Stated Patent and Trademark Office on September 1, 2006. (Doc. 65, at 4). The '679 Patent describes a vertical conveyor, which carries "a stream of closely spaced articles along a conveyor path" by utilizing at least one pair of roller chain assemblies. (Doc. 27-1, at 4). The allegedly infringing product is a conveyor that was sold by the Thermal Product Solutions division of SPX[3] to Southern Graphic Systems, Inc. ("SGSI") on or about January 24, 2012. (Doc. 62, at 2, ¶2). The conveyor sold to SGSI bore the model number MM45VD106M (the "SGSI Conveyor"), and had an overall length of about 167.990 inches. (Doc. 62, at 2, ¶2). The SGSI Conveyor was custom made, and SPX did not manufacture any other conveyors with the same design. (Doc. 62, at 2, ¶3). Besides the SGSI Conveyor, Swartz does not allege any other products of SPX infringed on the '679 Patent. (Doc. 62, at 1-2, ¶1).

         Swartz, who was an employee of SPX when the SGSI Conveyor was manufactured and sold, further avers that he maintains sole and exclusive ownership over the rights to the '679 Patent. (Doc. 27, at 6, ¶17; Doc. 38, at 5, ¶17; Doc. 58, at 3, ¶2). However, in connection with his employment contract with SPX, Swartz signed a Confidentiality Agreement on August 17, 2006. (Doc. 65, at 4). The Confidentiality Agreement contained the following assignment clause:

Inventions/Developments.
"...I hereby assign, and agree to assign to SPX during my employment and thereafter, all my rights to and evidence of such rights to the Developments, whether or not patent applications are filed thereon. I agree, whenever requested to do so by SPX during my employment or thereafter...to grant SPX or its nominee my entire interest in any or all such Developments by executing, acknowledging, and delivering all documents...in support of a particular invention, which SPX may deem necessary or proper for that purpose and for the purpose of perfecting in SPX title to patents..."

(Doc. 59-5, at 3).

         Notwithstanding the assignment clause, Swartz avers that the '679 Patent does not contain new matter from his previous United States patent application 10/974, 058 (the '"058 Application") filed on October 27, 2004. (Doc. 58, at 3, 5-7). Specifically, Swartz claims that the '679 Patent was based off of the '058 Application, which was filed before the Confidentiality Agreement with SPX was executed. (Doc. 58, at 3). SPX counters, however, that new matter was indeed added to the application that actually led to the '679 patent-U.S. Patent No. 11/469, 494 (the '"494 Application"). (Doc. 65, at 6).

         On February 24, 2015, Swartz filed the instant patent infringement action pursuant to 35 U.S.C. § 101. (Doc. 1). After a lengthy procedural history, Swartz filed an amended complaint against SPX on February 12, 2016. (Doc. 27). In the amended complaint, Swartz alleged that the SGSI Conveyor infringed on independent claims 12 ("Claim 12") and 25 ("Claim 25") of the '679 Patent, and their dependent claims[4]13-21 and 26-27. (Doc. 27, at 8, ¶22; Doc. 62, at 3, ¶¶6-7). Alternatively, Swartz argued that the SGSI Conveyor infringed the '679 Patent under the doctrine of equivalents. (Doc. 27, at 8, ¶22). On July 20, 2016, SPX moved to dismiss the amended complaint for failure to effect timely service under Federal Rule of Civil Procedure 4(m). (Doc. 32). On December 8, 2016, the undersigned Federal United States Magistrate Judge issued a Report and Recommendation allowing Swartz to correct service on SPX. (Doc. 35). The District Court adopted the Report and Recommendation on January 13, 2017 (Doc. 37), and SPX filed an answer to Swartz's amended complaint on January 26, 2017. (Doc. 38). Therein, SPX asserted a number of counterclaims against Swartz, including a declaration of non-infringement of Claims 12 and 25, a declaration of invalidity of the '697 Patent, and specific performance for the assignment of the '679 Patent under the terms of the Confidentiality Agreement. (Doc. 38, at 17-21, ¶¶14-35). Swartz filed an answer to SPX's counterclaims on February 6, 2017 (Doc. 44), and moved for partial summary judgment on June 26, 2017. (Doc. 58). In his motion for partial summary judgment, Swartz argues that he retained sole and exclusive ownership over the '679 Patent, in apparent response to SPX's counterclaim. (Doc. 38; Doc. 58). SPX filed a brief in opposition to Swartz's motion on July 17, 2017 (Doc. 64), and Swartz filed a reply brief on July 25, 2017.[5] (Doc. 67).

         On June 29, 2017, SPX filed a Motion for Summary Judgment on the grounds of noninfringement of the '679 Patent. (Doc. 60). SPX filed a brief in support of the Motion for Summary Judgment on the same day (Doc. 61), as well as a statement of undisputed material facts. (Doc. 62). Swartz filed a brief in opposition to SPX's Motion for Summary Judgment on July 7, 2017 (Doc. 63), and SPX submitted their reply brief on July 19, 2017. (Doc. 66).

         Having been fully briefed, the matter is now ripe for disposition.

         II. Standard of Review

         Under Rule 56 of the Federal Rules of Civil Procedure, summary judgment should be granted only if "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). A fact is "material" only if it might affect the outcome of the case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute of material fact is "genuine" only if the evidence "is such that a reasonable jury could return a verdict for the non-moving party." Anderson, 477 U.S. at 248. In deciding a summary judgment motion, all inferences "should be drawn in the light most favorable to the non-moving party, and where the non-moving party's evidence contradicts the movant's, then the non-movant's must be taken as true." Pastore v. Bell Tel. Co. of Pa., 24 F.3d 508, 512 (3d Cir. 1994). However, the Court need not accept mere conclusory allegations. Lujan v. Nat'l Wildlife Fed'n, 497 U.S. 871, 888(1990).

         At the summary judgment stage, the Court's function is not to make credibility determinations, weigh evidence, or draw inferences from the facts. Anderson, 477 U.S. at 249. Rather, the court must simply "determine whether there is a genuine issue for trial." Anderson, 477 U.S. at 249. The party seeking summary judgment "bears the initial responsibility of informing the district court of the basis for its motion, " and demonstrating the absence of a genuine dispute of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the movant makes such a showing, the non-movant must set forth specific facts, supported by the record, demonstrating that "the evidence presents a sufficient disagreement to require submission to the jury." Anderson, 477 U.S. at 251-52.

         In evaluating a motion for summary judgment, the Court must first determine if the moving party has made a prima facie showing that it is entitled to summary judgment. See Fed. R. Civ. P. 56(a); Celotex, 477 U.S. at 331. Once that prima facie showing has been made, the burden shifts to the nonmoving party to demonstrate the existence of a genuine dispute of material fact. See Fed. R. Civ. P. 56(a); Celotex, 477 U.S. at 331. With respect to cross-motions for summary judgment, "[e]ach movant must demonstrate that no genuine issue of material fact exists; if both parties fail to carry their respective burdens, the court must deny [both] motions. Quarks v. Palakovich, 736 F.Supp.2d 941, 946 (M.D. Pa. 2010) (citing Facenda v. N.F.L. Films, Inc., 542 F.3d 1007, 1023 (3d Cir. 2008)). However, a federal court should grant summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Farrell v. Planters Lifesavers Co., 206 F.3d 271, 278 (3d Cir. 2000).

         III. Discussion

         A. SPX's Motion for Summary Judgment Against Swartz

         SPX moves for summary judgment on the grounds that the accused product has not infringed claims 12-21 or 25-27 of the '679 Patent. (Doc. 61, at 8-21). Specifically, SPX argues that the SGSI Conveyor neither satisfies the elements of (1) an "elongate rail" on which the "first and second sprockets are rotatably mounted" nor (2) a rail that is "surrounded" by the roller chain. (Doc. 61, at 8-21; Doc. 62, at 12, ¶¶27-28). SPX further argues that the SGSI Conveyor does not infringe under the doctrine of equivalents, as the result achieved by Claims 12 and 25 is vitiated by the accused conveyor's configuration. (Doc. 61, at 21-23; Doc. 62, at 20, ¶46).

         1. Non-infringement of the'679 Patent

         Under 35 U.S.C. § 271, a patent is infringed when a party, "without authority, makes, uses, offers to sell, sells, within the United States or imports into the United States any patented invention during the term of the patent." In a motion for summary judgment, determination of patent infringement (or, non-infringement) requires the Court to engage in a two-part inquiry. See Markman v. Westview Instruments, Inc., 52 F.3d 967, 976 (Fed. Cir. 1995). First, the Court must interpret the claims at issue to determine their meaning and scope. Markman, 52 F.3d at 976. Second, the Court must compare the construed claim's terms to the accused product. Markman, 52 F.3d at 976. For there to be direct infringement, the accused invention must "perform each and every step or element of a claimed method or product." Paymentech, LP, 498 F.3d 1373, 1378 (Fed. Cir. 2007). Thus, although the question of infringement is usually one for a jury, a Court may grant summary judgment of noninfringement "if no reasonable jury could determine that every limitation recited in the properly construed claim either is not, or is, found in the accused device...." See Karlin Tech., Inc. v. Surgical Dynamics, Inc., Ill. F.3d 968, 974-75 (Fed. Cir. 1999).

         2. Claim Construction

         An inventor may only assert ownership "over those designs encompassed within the claims section of the patent." See 35 U.S.C. § 112; Pfaff v. Wells Elecs., Inc., 525 U.S. 55, 63, 119 S.Ct. 304, 142L.Ed.2d261 (1998); Phillips v. AWH Corp., 415 F.3d 1303, 1312 (Fed. Cir. 2005). As such, the first step in a non-infringement analysis is for the Court to properly construe the claims at issue, thereby ascertaining their meaning and scope. Markman, 52 F.3d at 976. This determination, referred to as "claim construction, " is a question of law solely within the purview the Court. See CyborCorp. v. FAS Techs., 138 F.3d 1448, 1454 (Fed. Cir. 1998). Further, to engage in proper construction, the Court must "determine the 'ordinary and customary meaning' of the claim terms as they would be understood by a 'person of ordinary skill in the art ("POSITA").'" Rhino Assocs., LP. v. Berg Mfg. & Sales Corp., 482 F.Supp.2d 537, 544-45 (M.D. Pa. 2007) (citing Phillips, 415 F.3d at 1312-13).

         Upon interpreting the disputed claim, the Court may properly rely on a number of evidentiary sources for guidance. First, the Court must look to the "intrinsic evidence" of the record, which includes the language of the claim, the patent's specification, and prosecution history where available. Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576, 1582 (Fed. Cir. 1996). Thereafter, "if needed to assist in determining the meaning or scope of technical terms in the claims, " the Court may consult the extrinsic evidence of the record. Vitronics Corp., 90 F.3d at 1583 (citing Pall Corp. v. Micron Separations, Inc.,66 F.3d 1211, 1216 (Fed. Cir. 1995)). Such extrinsic evidence may include "all ...


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