IP Law Daily, PATENT—D. Del.: AK Steel obtains invalidation of one ArcelorMittal patent, but faces new infringement charges, (Dec 7, 2015)

By Cheryl Beise, J.D.

The federal district court in Wilmington, Delaware, has invalidated the remaining two claims in a reissue patent directed to the fabrication of type of mechanically-resistant steel sheet that ArcelorMittal had asserted against competitor AK Steel Corporation. The court’s decision put an end to the older of two consolidated infringement actions, which had begun in 2010 and twice made its way to the Federal Circuit (ArcelorMittal France v. AK Steel Corp., December 4, 2015, Robinson, S.). Although the court granted AK Steel’s motion for summary judgment of non-infringement and invalidity in Civ. No. 10-050, it also granted ArcelorMittal’s motion for leave to amend its complaint in Civ. No. 13-685, to assert infringement of a related patent.

Procedural background. In January 2010, ArcelorMittal France and ArcelorMittal Atlantique et Lorraine filed suit (Civ. No. 10-050) against AK Steel Corporation (“AK Steel”), Severstal Dearborn, Inc., and Wheeling­Nisshin, Inc., asserting infringement of U.S. Patent No. 6,296,805 (the ’805 patent). The litigation proceeded to claim construction and trial, ending in a jury verdict in the defendants’ favor.

However, on November 30, 2012, the Federal Circuit (“ArcelorMittal I,” 700 F.3d 1314) reversed in part the court’s claim construction and vacated the jury’s infringement verdict and obviousness finding as possibly tainted by erroneous construction of the term the term “hot-rolled steel sheet.” The jury’s verdict of anticipation was also vacated as unsupported by the evidence. The district court’s construction of the term “very high mechanical resistance” in claim 1—meaning an ultimate tensile strength of 1500 MPa or greater—was upheld on appeal. The case was remanded for a new trial addressing infringement under the correct claim construction and the commercial success aspect of obviousness.

While the appeal was pending, in order to “correct” the construction of the claim term “very high mechanical resistance,” ArcelorMittal on April 16, 2013, obtained U.S. Patent No. RE44,153E (the RE153 patent). The RE153 patent contained claims 1-16, which originally appeared in the ’805 patent, as well as new claims 17-25. Claim 23 attempted to broaden claim 1, by stating, “The coated steel sheet of claim 1, wherein said mechanical resistance is in excess of 1000 MPa.”

On April 16, 2013, the plaintiffs in Civ. No. 10-050, together with ArcelorMittal USA LLC, filed a new complaint (Civ. No. 13-685) against AK Steel only, asserting infringement of the RE153 patent. The plaintiffs alleged that the new complaint substituted 1, 2, 5, 7, and 16 of the RE153 patent for the same claims in the surrendered ’805 patent, and asserted infringement of new claim 23.

With the substitution of the RE153 patent for the ’805 patent, the defendants moved for entry of summary judgment in Civ. No. 10-050, arguing that claims 1-23 of the RE153 patent were invalid as improperly broadened. On October 25, 2013, the court granted the motion, and sua sponte invalidated claims 24 and 25, concluding that the RE153 patent was impermissibly broadened, in violation of 35 U.S.C. § 251(d).

In June 2015, the Federal Circuit affirmed (“ArcelorMittal II,” 786 F.3d 885) the district court’s judgment that claims 1 through 23 of the RE153 patent were improperly broadened under § 251 and therefore were invalid. However, the appeals court reversed as to claims 24 and 25, which the parties had conceded maintained the same scope as the original claims. The case was remanded for further proceedings.

Present motions. Presently before the court were the following motions: (1) in Civ. No. 10-050, the defendants’ motion for summary judgment as to non-infringement and invalidity of claims 24 and 25 of the RE153 patent; (2) the plaintiffs’ motion to dismiss Civ. No. 10-050 for lack of subject matter jurisdiction; and (3) the plaintiffs’ motion for leave to file a first amended complaint in Civ. No. 13-685, to assert infringement of a third, related patent, RE44,940 (the RE940 patent). The plaintiffs also proposed to file a covenant not to sue on the RE153 patent, conditioned on the approval of their pending motion to amend.

Jurisdiction over claims 24 and 25. Following the Federal Circuit’s decision in ArcelorMittal II, only claims 24 and 25 of the RE153 patent remained at issue in the case. The defendants’ motion to dismiss Civ. No. 10-050 was based on the theory that claims 24 and 25 of the RE153 patent were no longer “in play.” The court disagreed. The court observed that claims 24 and 25 of the RE153 patent were “substantially identical” to claim 1 of the ’805 patent, as established by the Federal Circuit in ArcelorMittal II and consistent with the parties’ concession. Concluding that claims 24 and 25 of the RE153 patent were asserted in Civ. No. 10-050 as a matter of law, the court denied the plaintiffs’ motion to dismiss for lack of subject matter jurisdiction.

Infringement of claims 24 and 25. The court observed that the trial record contained no evidence of the defendants’ past infringement of claim 1 of the ’805 patent as construed by the Federal Circuit, i.e., hot-rolled coated steel sheet having an ultimate tensile strength of 1500 MPa or greater.” Because the jury found no infringement under the doctrine of equivalents, and ArcelorMittal did not challenge that aspect of the verdict, any infringement analysis was limited to literal infringement, the court noted. In addition, the plaintiffs were not now asserting pre-trial acts of infringement, but only new acts of infringement since the January 2011 trial. Under these circumstances, the court concluded that there were no genuine issues of material fact as to infringement of claims 24 and 25 of the RE153 patent. The court accordingly granted the defendants’ motion of summary judgment of non-infringement.

Validity of claims 24 and 25. The court also concluded that claims 24 and 25 were invalid for obviousness. On the issue of obviousness, the Federal Circuit in ArcelorMittal I remanded for reconsideration of the limited factual issue of commercial success. The defendants contended, and the plaintiffs did not dispute, that ArcelorMittal only sold flat-rolled steel sheets that had not undergone additional heat treating and had not attained an ultimate tensile strength of 1500 MPa or higher, as required by claim 24. Neither party addressed claim 25 with respect to commercial success. The court accordingly granted the defendants’ motion of summary judgment of invalidity of the RE153 patent.

Covenant not to sue. The court’s judgment of no infringement and invalidity of the RE153 patent in Civ. No. 10-050 effectively mooted the plaintiffs' proposed covenant not to sue. “Of course, if plaintiffs had simply filed the covenant instead of making it conditional, they could have avoided the entry of judgment—once again, hoisted by their own petard,” the court said.

Motion to amend. The court, however, granted the plaintiffs’ motion to file a first amended complaint in Civ. No. 13-685.

The case is Nos. 1:13-cv-00685-SLR and 1:10-cv-00050-SLR.

Attorneys: Jeffrey B. Bove (Novak Druce Connolly Bove + Quigg LLP) for ArcelorMittal France and ArcelorMittal Atlantique et Lorraine. Adam Wyatt Poff (Young, Conaway, Stargatt & Taylor LLP) for AK Steel Corp.

Companies: ArcelorMittal France; ArcelorMittal Atlantique et Lorraine; ArcelorMittal USA LLC; AK Steel Corp.; Severstal Dearborn, Inc.; Wheeling-Nisshin, Inc.

Cases: Patent DelawareNews