Callaway Golf Co. v. Acushnet Co.
2009 U.S. App. LEXIS 18142, 576 F.3d 1331, 91 U.S.P.Q. 2d (BNA) 1705 (2009)
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Rule of Law:
A jury verdict finding a dependent patent claim invalid for obviousness while finding the independent claim from which it depends not invalid is irreconcilably inconsistent and requires a new trial. Additionally, a prior art document incorporates material by reference when it clearly identifies the subject matter to be incorporated and where that subject matter is found, even if the host document describes some of that material as merely 'preferable'.
Facts:
- Callaway Golf Company ('Callaway') owns several 'Sullivan patents' for a multi-layer golf ball with a 'dual personality' designed for both distance and playability.
- The patented golf ball construction involves a core, a hard inner cover layer made from an ionomer resin blend, and a soft outer cover layer made from a polyurethane material.
- The patent claims specify certain hardness values for the inner and outer cover layers, measured by a 'Shore D hardness' standard.
- Acushnet Company ('Acushnet') manufactures and sells the Titleist Pro V1, Pro V1 (discontinued), and Pro V1x lines of golf balls.
- Acushnet's accused golf balls feature a multi-layer construction, including an ionomer-blend inner cover and a polyurethane outer cover.
Procedural Posture:
- Callaway sued Acushnet for patent infringement in the U.S. District Court for the District of Delaware.
- The district court construed the claim term 'cover layer having a Shore D hardness' to mean the hardness must be measured on the golf ball itself.
- Following the claim construction ruling, Acushnet stipulated that its products infringed the asserted claims.
- The district court granted summary judgment to Callaway, finding the patents were not anticipated by the 'Nesbitt' patent because Nesbitt did not properly incorporate another reference, 'Molitor ‘637'.
- A jury trial was held solely on Acushnet's defense of obviousness.
- The jury returned a verdict finding dependent claim 5 of the '293 patent invalid for obviousness, but finding the other eight asserted claims, including independent claim 4 from which claim 5 depends, not invalid.
- The district court entered judgment consistent with the jury's verdict and denied Acushnet's post-trial motion for judgment as a matter of law or for a new trial.
- Acushnet appealed the judgment to the U.S. Court of Appeals for the Federal Circuit.
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Issue:
Is a new trial on the issue of obviousness required when a jury returns a verdict finding a dependent patent claim invalid but finds the independent claim from which it depends not invalid?
Opinions:
Majority - Dyk, Circuit Judge
Yes, a new trial is required. A jury verdict that finds an independent claim nonobvious while simultaneously finding a dependent claim stemming from it obvious is irreconcilably inconsistent as a matter of law. A dependent claim, by definition, includes all the limitations of the independent claim plus at least one additional limitation; therefore, an independent claim cannot be nonobvious if a narrower dependent claim is obvious. The court rejected Callaway's attempts to reconcile the verdict by distinguishing between claims based on a 'blend' limitation, as the parties had treated the patents as a group at trial. The district court's rationale that the inconsistency was harmless because other patents were found valid was flawed, as the jury could have rationally reached either verdict on all claims. The proper remedy for such an irreconcilable inconsistency, where the evidence could support either outcome, is to order a new trial, not to accept one part of the verdict and dismiss the other. The court also affirmed the district court's claim construction, holding that 'cover layer having a Shore D hardness' requires an on-the-ball measurement. The specification and testimony from Acushnet's own witnesses showed that measuring hardness on the finished ball was standard industry practice, despite the ASTM standard's general preference for flat surfaces. Furthermore, the court reversed the district court's summary judgment of no anticipation. It held that the Nesbitt prior art patent did incorporate the Molitor '637 patent by reference because Nesbitt's language—'[r]eference is made to...a number of foamable compositions'—was sufficient to incorporate all listed compositions in Molitor, including polyurethane and ionomer blends, not just the 'preferable' ionomer resins. This reversal required remanding the anticipation issue for further proceedings.
Analysis:
This decision reinforces a fundamental principle of patent law: a dependent claim cannot be obvious if the independent claim from which it derives is not. By mandating a new trial for such an inconsistent verdict, the court underscores the importance of logical consistency in jury findings and limits a trial court's ability to salvage contradictory outcomes. The ruling on incorporation by reference also carries significant weight, clarifying that a host document's reference to a 'number of compositions' in another document incorporates the entire list, preventing parties from narrowly reading such references to exclude non-preferred embodiments. This broadens the scope of material that can be considered part of a single prior art reference for anticipation purposes.
