Everpure, Inc. v. Cuno, Inc., Defendant/cross-Appellant ( 1989 )

MARKEY, Chief Judge.

Everpure, Inc. (Everpure) appeals from a July 21, 1988 summary judgment of the United States District Court for the District of Connecticut, No. CIVIL N-88-170 PCD (Dorsey, J.), based on a finding that Cuno Inc. (Cuno) did not infringe claims 1, 4, 5, and 6 of Everpure’s United States Patent No. 3,746,171 (’171). Cuno cross-appeals the denial of attorney fees and Rule 11 sanctions and requests attorney fees on appeal. We affirm in all respects and deny Cuno’s request for attorney fees on appeal.

BACKGROUND

The asserted claims of Everpure’s ’171 patent are drawn to the combination of a head and an attached filter cartridge. The neck of the cartridge is removably inserted into the head and has channels for directing fluid to and from a filter sealed within the cartridge. When Everpure’s filter wears out, it sells entire cartridges for periodic replacement during the much longer life span of the head.

Cuno supplies, free of charge to its customers, an adapter that enables attachment of a Cuno cartridge to an Everpure head. The adapter performs the function of the neck of Everpure’s cartridge.

District Court Opinion

Everpure sued Cuno for contributory and induced infringement. Cuno moved for summary judgment of non-infringement, alleging that replacement of Everpure’s cartridges constituted permissible repair.¹ The district court granted Cuno’s motion as a matter of law, finding no genuine issue of material fact as to contributory or induced infringement of the asserted claims. The district court reasoned:

It is not without significance that the cartridge consists of the internal material which accomplishes the filtering process. Specifically, the casing contains the filtering element which receives, filters, and discharges the fluid from and to the filter head to which it interconnects. It is the filtering element, not the casing, which eventually wears out. Yet, the patent speaks of “a replaceable filter unit.” The objects of the patent are a quickly and easily removable filter unit achieved by a clamping collar which connects the filter unit and head. When used in conjunction with the pressure vessel, the clamping collar allows for the assembly and disassembly of the filter unit and head while it is under pressure without the loss of fluid.

* # >k # * *

Here it is the combination that is protected. The cartridge is not. Defendant is neither contributing to nor inducing a direct infringement of plaintiff’s product. A purchaser of plaintiff’s filter unit is free to replace the worn out filter cartridge and the fact that it requires a particular cartridge configuration to mate it to the head does not alter the legal principle. The filter cartridge is simply a component in a patented combination and the owner has the right to preserve the useful life of the combination by replacement of worn, unpatented components. Defendant’s sale of a unit with an adapter to permit that mating is no different than selling a single cartridge that conforms to the configuration of the head. This does not constitute infringement as a matter of law. Special Equip. Co. v. Coe, 824 U.S. 370, 376, 65 S.Ct. 741, 744, 89 L.Ed. 1006 (1925) (unpatented part of a combination patent may be appropriated by anyone).

The district court denied Cuno’s motion for attorney fees, finding this not an “exceptional case”, 35 U.S.C. § 285 (1982) because Everpure’s position was not “so unsound as to have been frivolous.” The district court denied Cuno’s request for sanctions under Rule 11, Fed.R.Civ.P., because Cuno failed to show that a reasonable inquiry was not made before suit was brought.

ISSUES

1. Whether the district court erred in granting summary judgment of non-infringement.

2. Whether the district court erred in denying Cuno’s motion for attorney fees and sanctions.

3. Whether Cuno is entitled to attorney fees on appeal.

OPINION

Summary Judgment

Summary judgment may be granted where “there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law.” Fed. R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986). Summary judgment is appropriate here because there can be neither contributory nor induced infringement when, because of the permissible repair doctrine, there has been no direct infringement. Aro Mfg. Co. v. Convertible Top Replacement Co., 365 U.S. 336, 341, 81 S.Ct. 599, 602, 5 L.Ed.2d 592, 128 USPQ 354, 357 (1961); Met-Coil Sys. Corp. v. Korners Unlimited, Inc., 803 F.2d 684, 687, 231 USPQ 474, 477 (Fed.Cir.1986). The doctrine of permissible repair allows one lawfully using a patented combination to preserve and maintain the combination by making repairs or replacing unpatented component parts necessary for continued use. Porter v. Farmers Supply Serv., Inc., 790 F.2d 882, 885-86, 229 USPQ 814, 816 (Fed.Cir.1986).²

Everpure says summary judgment was inappropriate because the repair/reconstruction dispute raises a genuine issue of material fact, namely, whether the filter is itself replaceable. Everpure argues that the permissible repair doctrine would permit replacement of only a worn part, such as the filter. It also says Cuno’s adapter constitutes impermissible reconstruction because: (1) the adapter replaces an unworn part (the neck) of Everpure’s cartridge; and (2) the adapter changes the structure and operation of the patented combination by rearranging the direction of water flow through the cartridge.

Everpure correctly states that it is replacement of worn or spent parts in a patented combination that constitutes repair and not reconstruction. Porter, 790 F.2d at 886, 229 USPQ at 816 (collecting authorities). Everpure, however, is “hoist on its own petard”, for it seals its filter into its cartridge. Everpure and Everpure alone made the business decision to sell disposable cartridges and to render its filter irreplaceable without replacement of the entire cartridge. Everpure submitted no affidavit that would raise a material fact question on whether owners of Ever-pure’s assembly could expose and replace the filter without cutting, bending, distorting, and then rebuilding, the cartridge. That such action by the owner of the combination is neither practical nor feasible is illustrated by the label on Everpure’s disposable cartridge. That label emphasizes “Quick Change Cartridge”, instructs owners to “Service with a new cartridge ... at least once a year”, and contains illustrated instructions on changing the cartridge, not the filter. Thus Everpure has designed and conducts a business scenario in which the entire cartridge, including its sealed-in neck and filter, is spent when the filter wears out.³ It is at least difficult to accept the notion that one who purchases a disposable cartridge under instructions to replace it at least yearly is guilty of infringement when the buyer does precisely that.

Replacement of the spent cartridges in this case is clearly repair and not reconstruction. See Payne v. Dickinson, 109 F.2d 52, 54, 44 USPQ 181, 183 (3d Cir.), cert. denied, 310 U.S. 637, 60 S.Ct. 1080, 84 L.Ed. 1406 (1940) (not practicable for owner to replace worn needle securely inserted in hub; possible at factory but “well nigh impossible” with facilities at owner’s command); Electric Auto-Lite Co. v. P. & D. Mfg. Co., 109 F.2d 566, 567, 44 USPQ 377, 379 (2d Cir.1940) (Circuit Judges L. Hand, A. Hand, and Chase writing per curiam) (buyer entitled to replace entire breaker arm, not just the worn-out contact points attached to the arm; repair theory rests on patentee’s intent that buyer have longer use than the life of the shortest-lived part).⁴

That the channels in the neck of Ever-pure’s unpatented cartridge and those in the adapter are different is inconsequential. First, the neck is part of the spent cartridge. Second, “there is no legally recognizable or protected 'essential’ element, ‘gist’ or ‘heart’ of an invention in a combination patent.” Aro, 365 U.S. at 345, 81 S.Ct. at 604, 128 USPQ at 359. As the district court indicated, it is of no moment that Cuno chose to supply an adapter with its cartridge, rather than supplying a cartridge otherwise compatible with Ever-pure’s head. The change in water flow does not constitute reconstruction because the direction of flow is irrelevant to the nature and function of the patented combination.

In sum, a buyer commits no direct infringement of claims 1, 4, 5, or 6 when replacing Everpure’s spent cartridge with an adapter-cum-cartridge, and, as above indicated, without direct infringement there can be no contributory or induced infringement.

Attorney Fees and Sanctions

In view of the novelty of the present fact pattern, i. e., use of an adapter to facilitate repair by replacement of a spent, disposable part of a patented combination, we cannot say the district court abused its discretion in denying Cuno’s motion for attorney fees and Cuno’s request for Rule 11 sanctions. See Pennwalt Corp. v. Akzona Inc., 740 F.2d 1573, 1582, 222 USPQ 833, 839 (Fed.Cir.1984); Woodcrest Nursing Home v. Local 144, Hotel, Hospital, Nursing Home and Allied Services Union, 788 F.2d 894, 899 (2d Cir.1986).

Though Everpure’s effort to force a trial to determine whether its filter is itself replaceable is regrettable in the face of all the undisputed facts, its argument on the adapter moves this appeal just over the line marked “frivolous”. Hence, we can neither declare this appeal frivolous nor award attorney fees. Fed.R.App.P. 38.

AFFIRMED.

1 . Everpure moved for preliminary injunction. Cuno's motion for summary judgment included allegations of patent misuse, inequitable conduct, and invalidity. Everpure’s motion and Cuno's allegations were not considered by the district court and thus are not before us.

2 . Non-asserted claims 7-12 are drawn to the details of Everpure's unitary cartridge and to its closure. Everpure has not challenged the district court’s reference to replacement of "unpat-ented” parts.

3 . The ’171 patent specification says the entire cartridge is preferably disposable but could be made in three separate parts (casing, closure, and filter), in which case only the filter would be replaced. The latter circumstance is not present here.

4 .Everpure puts much store by Automotive Equipment Co. v. Connecticut Telephone & Electric Co., 19 F.2d 990 (3d Cir.), cert. denied, 275 U.S. 564, 48 S.Ct. 121, 72 L.Ed. 428 (1927). We agree with the courts in Payne, which ignored, and Electric Auto-Lite, which declined to follow, Connecticut Telephone.