Evans Cooling Systems, Inc. v. General Motors Corp.
125 F.3d 1448 (1997)
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Rule of Law:
The on-sale bar of 35 U.S.C. § 102(b) invalidates a patent if the invention was offered for sale more than one year prior to the patent application filing date, regardless of whether the seller was the inventor or a third party who allegedly misappropriated the invention.
Facts:
- John Evans conceived an aqueous reverse flow cooling system for engines in 1984 and reduced it to practice in 1986.
- In the spring of 1989, Evans demonstrated the cooling system to General Motors (GM) at a GM test facility.
- Evans alleged that GM stole the invention during this demonstration.
- In late April or early May of 1991, GM sent order guides and brochures for its 1992 Corvette, which contained an engine with a reverse flow cooling system, to its independent dealers.
- On June 13, 1991, a retail customer, Aram Najarían, entered into a contract with a GM dealer to purchase a 1992 Corvette with the new engine and placed a deposit.
- John Evans filed his patent application for the cooling system on July 1, 1992.
Procedural Posture:
- Evans Cooling Systems, Inc. sued General Motors Corporation (GM) in the United States District Court for the District of Connecticut for patent infringement.
- GM filed a counterclaim seeking a declaration that the patent was invalid and not infringed.
- GM moved for summary judgment, arguing the patent was invalid under the on-sale bar of 35 U.S.C. § 102(b).
- The district court granted GM's motion for summary judgment, holding the patent invalid.
- Evans appealed the district court's decision to the United States Court of Appeals for the Federal Circuit.
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Issue:
Does the on-sale bar of 35 U.S.C. § 102(b) invalidate a patent when a third party, who allegedly misappropriated the invention, places the invention on sale more than one year before the patent application's filing date?
Opinions:
Majority - Michel, Circuit Judge.
Yes. The on-sale bar invalidates a patent when the invention is placed on sale by any party, including an alleged thief, more than one year before the patent application filing date. The court first determined that a legally cognizable offer for sale occurred. The purchase agreement between the GM dealer and Mr. Najarían on June 13, 1991—before the critical date of July 1, 1991—was a specific and definite offer for sale of a successfully tested device, which is sufficient to trigger the on-sale bar. The court then refused to create an exception to the on-sale bar for instances of misappropriation. Citing persuasive precedent from the Third Circuit in Lorenz, the court held that the language of § 102(b) is absolute and does not depend on the identity of the seller or the circumstances of the sale. Even if an exception existed for the misappropriating party itself, the sale here was made by innocent third parties (the dealer and the retail customer), which is sufficient to bar the patent under the reasoning of In re Martin. The inventor's proper remedy for theft is a state-law claim for trade secret misappropriation, not an exception to the strict, Congressionally-mandated timeline for filing a patent application.
Analysis:
This decision reinforces the strict and absolute nature of the on-sale bar in patent law, clarifying that its application is not dependent on the inventor's actions or consent. By rejecting an equitable exception for theft, the court places the full burden of diligence on the inventor to file a patent application promptly after an invention is ready for patenting. The ruling signals that public policy favoring prompt disclosure and the finality of the one-year grace period outweighs concerns about unfairness from a third party's unauthorized commercialization. This precedent forces inventors who disclose their technology to potential business partners to be acutely aware that any subsequent sale, authorized or not, starts the one-year clock to file for a patent.
