IP Law Daily, PATENT—S.D. Cal.: Equipment maker did not infringe upon patent involving adjustable wrenches, (Oct 3, 2022)

By Ursula Furi-Perry, J.D., MBA

Patent holder failed to establish that the allegedly infringing wrenches met the limitations of the patent claims as constructed by the court; false marking was not per se infringement.

A patent holder brought suit against an equipment company, his former employer and business partner, alleging patent infringement arising from the sale of adjustable wrenches. The court granted summary judgment for the equipment company, holding that the patent holder failed to establish that the allegedly infringing wrenches met the limitations of the patent claims as constructed by the court; also, false marking was not per se infringement. Moreover, the false marking claim was decided in the equipment company’s favor, as the patent holder failed to show any evidence of a loss of sales, reputation, or the ability to compete as a result of the marking of the wrenches (Hebert v. Allied Rubber & Gasket Co., September 30, 2022, Ohta, J).

Background. The case arose from a failed business partnership between a plumbing and fire sprinkler equipment company and the inventor and patent holder of a wrench that adjusts to varying widths for use on fire sprinklers of all sizes. The patent holder entered into a partnership that allowed the equipment company to distribute his wrenches exclusively. Pursuant to that contract, the company paid the patent holder $25 per wrench, and the patent holder applied the company’s logo to his wrenches and directed customers to purchase the wrenches directly from the company. The patent number was placed on the wrenches.

The patent holder subsequently transitioned from being a partner to being an employee of the company, responsible for working with a mutually found new manufacturer to make the wrenches. The equipment company then began purchasing the wrenches directly from that manufacturer, and it also manufactured three other models of adjustable wrench, but those three models were never ultimately sold for various reasons.

About two years later, disputes began to arise between the patent holder and the equipment company, and the patent holder’s employment was terminated. The company did not order any additional wrenches from the manufacturer, and its executive expressed frustration, stating that the wrenches required modifications in order to “really work.” The company sent an offer of settlement to the patent holder, but he filed a claim in the U.S. District Court for the Southern District of California in 2020, claiming patent infringement, false marking, and unfair competition.

Both parties filed summary judgment motions, focused on whether the company sold wrenches protected by three claims of the patent. In 2021, a claim construction hearing was held where the parties disputed and the court decided on the meanings of four terms and phrases from the patent claims, namely dealing with the wrench’s threaded collar for adjusting a distance between a fixed jaw and an adjustable jaw.

Analysis. The federal district court addressed the procedural issue of the parties’ cross-motions for summary judgment under Rule 56 of the Federal Rules of Civil Procedure, analyzing whether there was a genuine dispute as to any material fact, and whether either party was entitled to judgment as a matter of law.

Patent infringement claims. The court held that the company did not infringe upon the patent, as the patent holder failed to establish that the allegedly infringing wrenches met the limitations of the claims, as required for a finding of infringement. Specifically, the patent holder failed to submit evidence that the infringing wrenches contained a “threaded collar” with a “helical-shaped groove or ridge,” nor did he prove that the allegedly infringing wrenches contained an actuator wheel with a smooth bar, which would be required for the court to find infringement based on the claim construction language.

Next, the court addressed the patent holder’s argument that the company’s marking of the wrenches with the patent number constituted per se infringement, warranting summary judgment in his favor. The court disagreed, noting that the company’s agreement to marking the wrenches was a result of its business relationship with the patent holder, rather than a reasoned conclusion of patent coverage. The patent holder directed the manufacturer to include the patent number on the wrenches, and the company simply assumed that the patent had covered the wrenches it was manufacturing, then later came to discover that it did not, the court stated.

False marking. The court also sided with the equipment company on the false marking claims brought by the patent holder. While the law prohibits false marking of devices, the court reasoned, only a plaintiff who has suffered a competitive injury may bring suit. The patent holder in this case failed to show any evidence of a loss of sales, reputation, or the ability to compete as a result of the marking of the wrenches; moreover, the court held that the patent holder consented to the patent marking.

Unfair competition. The court again sided with the equipment company on the patent holder’s unfair competition claim. The patent holder failed to raise a triable issue on the false markings claim as a predicate issue to unfair competition, and the company’s actions during litigation did not constitute unfair or deceptive conduct. Moreover, the patent holder did not submit evidence regarding alleged “bullying” or “disparaging” statements made by the company.

Conclusion. The federal district court denied the patent holder’s motion for partial summary judgment and granted the equipment company’s motion for summary judgment.

The Case is No. 3:20-cv-01350-JO-MDD.

Attorneys: Matthew M. Wawrzyn (Wawrzyn LLC) for Leland J. Hebert. Jason Swartz (Knobbe Martens) for Allied Rubber & Gasket Co.

Companies: Allied Rubber & Gasket Co.

Cases: Patent CaliforniaNews