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This case presents three issues: (1) whether there was corroborating evidence of a prior public use by the accused infringer Transweb; (2) whether 3M committed inequitable conduct in obtaining the patent-in-suit; and (3) whether Transweb’s attorneys fees are a proper measure of damages on a Walker Process antitrust claim. 

On the first issue, the Federal Circuit agreed with the district court that Transweb’s founder’s testimony was sufficiently corroborated to prove that invalidating prior art was supplied at a trade show more than one year prior to the filing of 3M’s patent.  The court applied a “rule of reason” analysis for corroboration, i.e., that all pertinent evidence is examined in order to determine whether the inventor’s story is credible.  Here, the founder’s testimony that the new filter material was presented at the trade show was corroborated by the evidence that such material was produced three months prior to the trade show and that Transweb was sending out samples of the material shortly after the show and offering it for sale within two months after the show. 

On the second issue, the Federal Circuit affirmed the inequitable conduct finding.  Here, 3M had some of the Transweb samples and submitted them to the PTO in connection with the prosecution of the patent.  But, 3M informed the Examiner, incorrectly, that the Transweb samples were received after signing a confidentiality agreement and therefore were not prior art.  Because the Examiner would have rejected the claims if the samples were properly disclosed as prior art, the samples were but-for material.  As to intent, the district court and the Federal Circuit found the prosecuting attorneys’ testimony to demonstrate a scheme to deceive the PTO and found the testimony at trial to be “incredible.”  Accordingly, there was no error in the district court’s inequitable conduct holding. 

On the third issue, the Federal Circuit held that an accused infringer’s attorneys fees are a proper measure of antitrust damages.  There was a connection between Transweb’s fees and an impact on competition.  3M’s lawsuit was an attempt to reduce competition and would have done so if it was successful.  Therefore Transweb’s attorney fees, incurred to foster competition, therefore are an antitrust injury. 

Transweb, LLC v. 3M Innovative Properties Company, Case No. 2014-1646 (February 10, 2016); Opinion by: Hughes, joined by Wallach and Bryson; Appealed From: United States District Court for the District of New Jersey, Hochberg, J.  Read the full opinion here.

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