Cargill, Inc. v. Sears Petroleum & Transport Corp. (388 F. Supp. 2d 37, 2005)

DECISION AND ORDER

PEEBLES, United States Magistrate Judge.

This action arises out of a commercial dispute between Cargill, Inc. (“Cargill”), a Delaware corporation with a principal place of business in Wayzata, Minnesota and engaged principally in the manufacture and sale of agricultural, food, and industrial products and services, and defendant Sears Petroleum & Transport Corporation (“Sears Petroleum”) and its affiliate, Sears Ecological Applications Co., LLC (“SEACO”) (collectively “Sears”), both headquartered in Upstate New York and historically operating in the gasoline and industrial fuel industry, though with relatively recent efforts toward expansion into the commercial de-icing market. Central to the dispute is a patent, issued in October of 2001 and assigned to Sears Petroleum, as well as the commercial deicing invention which it teaches. At trial Sears claimed, and the jury found, that after meeting with Sears representatives to discuss the prospect of a joint venture for the development and sale of a commercial de-icing product, utilizing Sears’ technology and Cargill’s dominant position in the industry and access to rock salt from its mines, Cargill employees misappropriated trade secret information divulged during the session by Sears concerning its new, innovative liquid de-icer, and thereafter developed and marketed a pre-treated rock salt de-icing product utilizing, as an ingredient, a liquid formulation derived from Sears’ formulation, thereby infringing the claims set forth in its later-acquired patent.

In the wake of the entry of judgment based upon the jury’s verdict and certain additional findings by the court, both sides have filed post-trial motions seeking various relief. Because I find no basis to disturb either the jury’s findings or my rulings prior to, during and following the trial, -the several cross-motions seeking judgment as a matter of law (“JMOL”) notwithstanding the jury’s verdict and/or a new trial are denied. In light of my finding that this represents an exceptional case, however, I am granting Sears’ application for an award of attorney fees and nontaxable costs.

I. BACKGROUND

The factual circumstances surrounding the parties’ claims and defenses in this action were addressed in detail in several decisions, familiarity with which is presumed, rendered earlier in this action, including Cargill, Inc. v. Sears Petroleum & Transport Corp., 334 F.Supp.2d 197 (N.D.N.Y.2004). I will recount only so much of the background as is necessary to provide context to my rulings, including with regard to the judgment which was entered.

In or prior to 1998 David Wood, an officer and employee of defendant Sears Petroleum, set out to explore development of an improved de-icing agent which would minimize or eliminate some of the inherently undesirable traits associated with then-existing formulations, including the presence of high molecular weight organic materials, phosphorus compounds and heavy metals, as well as difficulties associated with stratification during storage and the plugging of filters and nozzles resulting from product inconsistencies. To assist in the formulation of an improved deicing agent, Sears engaged the services of Robert A. Hartley, a Canadian chemist.

In December of 1998, inventors Wood and Hartley received test results from Bo-dyCote Ortech, Inc. (“BodyCote”), a Canadian laboratory retained to perform various analyses associated with their efforts, disclosing a synergistic freezing point depressive effect experienced by combining low molecular weight carbohydrates and magnesium chloride. Inventors Wood and Hartley followed this discovery with the filing of a utility patent application on January 4, 1999, and later a continuation-in-part (“CIP”) application on January 5, 2001, ultimately leading to the issuance on October 9, 2001 of United States Patent No. 6,299,793 (the ’793 patent) to inventors Wood and Hartley, and assignment of that patent to Sears Petroleum.

On July 29, 1999 a meeting was held in Rome, New York, where Sears Petroleum maintains its offices, between representatives of Sears, including David Wood, and Cargill, a leading commercial producer of rock salt. The purpose of that meeting was to explore the formation of a joint business relationship between the two companies to operate in the de-icing arena. Following that session, which was relatively brief, the parties met again on August 25, 1999 at Cargill’s offices in North Olmsted, Ohio to continue their discussions regarding the prospects of a joint business relationship. Prior to that second meeting, which was considerably lengthier than the earlier one, the parties entered into a written confidentiality agreement drafted by Cargill representatives, and intended to govern the exchange of information during those talks and protect the integrity of any confidential information disclosed by either of the parties.

Shortly after the 1999 meetings, Cargill began researching the use of cane molasses, a source of low molecular weight carbohydrates discussed by Wood with Car-gill representatives at the second session, as a liquid de-icing agent ingredient. These newly directed exploration efforts led to Cargill’s development of a product line bearing the ClearLane label including, inter alia, ClearLane Treated Salt and ClearLane PNS Treated Salt, two de-icers manufactured utilizing a liquid comprised of cane molasses, magnesium chloride, and other constituents as a pre-wetting agent to be sprayed onto rock salt prior to its application upon roadways and other surfaces where ice may form, in order to reduce scatter and enhance the salt’s ice melting capability. Cargill began selling the ClearLane Treated Salt products in October of 2000, and since then has experienced a significant rise in the sales of those products, to a point where in its fiscal year ending May 31, 2004 it sold 318, 140 tons of the treated salt, as compared to the 22,957 tons marketed in the first year after introduction of the new product.

II. PROCEDURAL HISTORY

This case, which is before me based upon consent of the parties pursuant to 28 U.S.C. § 636(c), see Dkt. No. 61, was tried before a jury, beginning on February 7, 2005. On March 10, 2005, following a protracted period of deliberation, the jury returned a unanimous verdict, utilizing a jury verdict form which was supplied for its use. In its verdict, the jury addressed Cargill’s declaratory judgment claims, asserting both non-infringement and patent invalidity/unenforceability, and various patent and common law counterclaims asserted by the Sears parties. Rejecting the several defenses offered by Cargill to Sears’ infringement claims, the jury found that each of the claims of the ’793 patent was infringed by Cargill’s manufacture and use of ClearLane Liquid and ClearLane PNS Liquid in its ClearLane Treated Salt products, either literally or under the doctrine of equivalents. The jury declined Sears’ invitation, however, to find that Cargill’s infringement was willful. On the issue of patent damages, the jury found that Sears Petroleum had experienced lost profits in the amount of $355,422 as a result of Cargill’s infringing conduct, and affixed a reasonable royalty for Cargill’s use of Sears’ patented technology at $1,777,113, calculated utilizing a royalty rate of $.1875 per gallon of liquid.

With respect to the various common law counterclaims asserted by the Sears parties, the jury found that Cargill had unlawfully misappropriated trade secrets from Sears Petroleum, and engaged in unfair competition with that entity. The jury also found that by its actions, Cargill breached a confidentiality agreement entered into between the parties in August of 1999, but rejected Sears’ request for an award of punitive damages with regard to the trade secret misappropriation and unfair competition claims. The jury awarded damages in varying amounts in connection with the common law claims upon which liability was found.

On April 12, 2005, following extensive briefing by the parties, I issued a decision and order addressing the jury’s verdict and JMOL motions made by the parties at various stages of the trial, pursuant to Rule 50 of the Federal Rules of Civil Procedure. Dkt. Nos. 358, 384. Judgment was thereafter entered on that same date in which, inter alia, Sears was awarded a total of $2,841,029.03 in damages as well as equitable relief, although the injunction issued to prohibit Cargill’s continued infringement of the ’793 patent was conditionally stayed pending appeal. Dkt. No. 359:

On April 26, 2005 both sides filed post-judgment motions, seeking various forms of relief. For its part, Cargill filed three motions seeking 1) JMOL or, alternatively, a new trial on the Sears common law counterclaims, Dkt. No. 370; 2) a new trial, based upon the conduct of defendants’ counsel and the court during the course of the trial, Dkt. No. 371; and 3) a motion for JMOL or, in the alternative, a new trial on the defendants’ patent law claims, Dkt. No. 373. The motions filed by the Sears parties on that date included 1) a motion for alteration of the judgment to include an award of enhanced patent damages, Dkt. No. 367; 2) an application for a finding of an exceptional case and an award of attorney fees, expert fees and non-taxable costs, Dkt. No. 368; and 3) a motion to amend/correct the judgment to include an award of lost profits pursuant to the jury’s verdict. Dkt. No. 369. Those motions, which have been fully briefed and orally argued, are now ripe for determination.

III. DISCUSSION

A. Standards of Review

Various of the motions currently pending before the court seek JMOL and/or a new trial. The standards which govern such motions, while not entirely dissimilar, are distinctly different. Despite their differences, however, both are tempered by Rule 61 of the Federal Rules of Civil Procedure, which provides that

[n]o error in either the admission or the exclusion of evidence and no error or defect in any ruling or order or in anything done or omitted by the court or by any of the parties is ground for granting a new trial or for setting aside a verdict or for vacating, modifying, or otherwise disturbing a judgment or order, unless refusal to take such action appears to the court inconsistent with substantial justice. The court at every stage of the proceeding must disregard any error or defect in the proceeding which does not affect the substantial rights of the parties.

Fed.R.Civ.P. 61; McDonough Power Equip., Inc. v. Greenwood, 464 U.S. 548, 553-54, 104 S.Ct. 845, 848-49, 78 L.Ed.2d 663 (1984); 11 Charles A. Wright, Arthur R. Miller and Mary Kay Kane, Federal Practice & Procedure § 2882 (2d ed.1995).

1. JMOL

Motions seeking JMOL, following a jury trial, are governed by Rule 50(b) of the Federal Rules of Civil Procedure. That rule provides, in relevant part, that

[i]f, for any reason, the court does not grant a motion for judgment as a matter of law made at the close of all the evidence, the court is considered to have submitted the action to the jury subject to the court’s later deciding the legal questions raised by the motion. The movant may renew its request for judgment as a matter of law by filing a motion no later than 10 days after entry of judgment — and may alternatively request a new trial or join a motion for a new trial under Rule 59.

Fed.R.Civ.P. 50(b). The rule goes on to provide that in ruling upon such a motion a court may allow the judgment to stand, order a new trial, or direct the entry of judgment as a matter of law notwithstanding that a verdict was returned against the moving party. Id.; 9A Charles A. Wright & Arthur R. Miller, Federal Practice & Procedure § 2538 (2d ed.1995).

The burden which a litigant faces when seeking JMOL in the face of an adverse jury verdict, while not insurmountable, is substantial. The entry of JMOL notwithstanding a contrary jury verdict is appropriately granted only when the evidence, viewed in a light most favorable to the non-moving party, is susceptible to only one possible verdict. Jund v. Town of Hempstead, 941 F.2d 1271, 1290 (2d Cir.1991) (citations omitted); Chang v. City of Albany, 150 F.R.D. 456, 459 (N.D.N.Y.1993) (McAvoy, C.J.) (citing, inter alia, Jund). The granting of such relief is warranted when

(1) there is such a complete absence of evidence supporting the verdict that the jury’s findings could only have been the result of sheer surmise and conjecture, or (2) there is such an overwhelming amount of evidence in favor of the mov-ant that reasonable and fair minded men could not arrive at a verdict against him.

Jund, 941 F.2d at 1290 (quoting, inter alia, Mattivi v. South African Marine Corp., 618 F.2d 163, 168 (2d Cir.1980)); see also Nimely v. City of New York, 414 F.3d 381, 390 (2d Cir.2005). In deciding a motion for JMOL, the court must draw all reasonable inferences in favor of the non-moving party and may not make credibility determinations or weigh the evidence, those functions properly falling within the jury’s province. Jund, 941 F.2d at 1290; 9A Wright & Miller, Federal Practice & Procedure § 2527; see also Mickle v. Mo rin, 297 F.3d 114, 120 (2d Cir.2002) (citations omitted).

2. New Trial

Post-trial motions seeking a new trial are governed by Rule 59 of the Federal Rules of Civil Procedure. That rule provides, in pertinent part, that

[a] new trial may be granted to all or any of the parties and on all or part of the issues ... in an action in which there has been a trial by jury, for any of the reasons for which new trials have heretofore been granted in actions at law in the courts of the United States[.]

Fed.R.Civ.P. 59(a).

While any appeal from the judgment entered in this case will go to the Federal Circuit, whose position on matters involving patent law are binding upon this court, to the extent that either party’s motion for a new trial is based upon matters not involving issues of pure patent law, it is addressed to “the established, discernable law of the involved cireuit[,]” in this case the Second Circuit. Atari, Inc. v. JS & A Group, Inc., 747 F.2d 1422, 1440 (Fed.Cir.1984), overruled on other grounds, Nobelpharma AB v. Implant Innovations, Inc., 141 F.3d 1059 (Fed.Cir.1998). In this circuit, a new trial is warranted only when the court is convinced that the jury has reached a “seriously erroneous result” or that the verdict represents a “miscarriage of justice.” Nimely, 414 F.3d at 392 (internal quotations and citations omitted); Sorlucco v. New York City Police Dept., 971 F.2d 864, 875 (2d Cir.1992); see also DLC Mgmt. Corp. v. Town of Hyde Park, 163 F.3d 124, 133 (2d Cir.1998); Atkins v. New York City, 143 F.3d 100, 102 (2d Cir.1998) (citation omitted); 11 Wright, et al., Federal Practice & Procedure § 2805.

Unlike the case with regard to a motion for JMOL under Rule 50(b), when addressing a new trial motion a court is permitted to weigh the evidence adduced at trial, and is not necessarily bound to view it in a light most favorable to the non-moving party. DLC Mgmt. Corp., 163 F.3d at 133-34. A jury’s credibility determinations, however, are entitled to great deference, and mere disagreement by the court with a jury’s verdict, without more, does not entitle a party to relief under Rule 59. Meiselman v. Byrom, 207 F.Supp.2d 40, 42 (E.D.N.Y.2002). A court should generally be indisposed to disturb a jury’s verdict on a Rule 59 motion unless the verdict is considered to have been “ ‘egregious.’ ” Id. (quoting, inter alia, DLC Mgmt. Corp., 163 F.3d at 134).

B. Cargill’s Motion For a New Trial

The centerpiece of Cargill’s quest for post-trial relief is its application for a new trial, based principally upon the claim that it was denied a fair trial. In that motion, Cargill complains of errors committed by the court — errors which, as will be seen, it describes as transcending the type of trial court error typically complained of, and the stuff of which appeals are made, instead rising to a level tantamount to court misconduct. Cargill also criticizes the conduct of Sears’ counsel throughout the litigation, and additionally raises concerns over the court’s instructions to the jury and the verdict form submitted for its use, and challenges certain portions of the jury’s verdict which, in its view, are inconsistent with the evidence adduced at trial.

1. Fair Trial

Before turning to the specifics of Car-gill’s new trial motion, one point must be made. It is virtually certain that neither party in this case received a perfect trial. Both prior to and throughout the course of the trial, which was permeated with contentiousness, the court was called upon to make many evidentiary, in limine, and substantive rulings, some of which implicated complex intellectual property law concepts. A showing that a party has not received a perfect trial, however, falls far short of the significant threshold which that party must surpass in order to demonstrate entitlement to a new trial. As the Supreme Court has observed,

[t]his Court has long held that a litigant is entitled to a fair trial, but not a perfect one, for there are no perfect trials. Trials are costly, not only for the parties, but also for the jurors performing their civic duty and for society which pays the judges and support personnel who manage the trials. It seems doubtful that our judicial system would have the resources to provide litigants with perfect trials, were they possible, and still keep abreast of its constantly increasing caseload.

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We have also come a long way from the time when all trial error was presumed prejudicial and reviewing courts were considered “citadels of technicality.” The harmless error rules adopted by this Court and Congress embody the principle that courts should exercise judgment in preference to the automatic reversal for “error” and ignore errors that do not affect the essential fairness of the trial.

McDonough Power Equip., Inc., 464 U.S. at 553-54, 104 S.Ct. at 848-49 (internal citations and some quotation marks omitted). Having reviewed Cargill’s new trial motion carefully against this backdrop, I discern no substantial and unfairly prejudicial errors which deprived it of a fundamentally fair trial.

The bases articulated by Cargill in its motion for seeking a new trial fall into four main categories, each of which will be separately addressed.

a. Reference to Size and Location of the Parties

In its new trial motion, Cargill complains of the efforts of Sears’ counsel to taint the jury by stressing both defendants’ connections to the Upstate New York region and the disparity, in terms of both relative size and financial resources, between the respective parties. Cargill contends that those efforts, notwithstanding the court’s curative instructions — characterized by Cargill as “bland” — resulted in undue prejudice and effectively denied Cargill its right to a fair trial.

The issue of relative size of the parties was raised by Cargill in one of sixteen motions in limine which were fully briefed and decided by the court in advance of trial. See Dkt. No. 156. That motion was denied, though without prejudice, based upon my finding that the motion lacked context, and that the financial resources and number of employees available to Car-gill was potentially relevant to at least some of the issues which could arise at trial. See Transcript of January 12, 2005 Proceedings (Dkt. No. 234) at 82-90. Employing the reasoning articulated in TVT Records v. Island Def Jam Music Group, 250 F.Supp.2d 341, 344 (S.D.N.Y.2003), in which another court was confronted with what it characterized as improper in li-mine motions seeking preemptively “to strike in shotgun fashion at whole topics and sources of prospective evidence,” I denied the motion, but indicated that I would police the trial to guard against undue prejudice, and would instruct the jury that every party, regardless of size, is entitled to the same fair consideration when litigating in the courts. Transcript of January 12, 2005 Proceedings (Dkt. No. 234) at 89-90.

During opening statements Sears’ counsel in fact did make reference to the relative size of the parties, as apparently anticipated by Cargill. Rather than registering a contemporaneous objection, Cargill’s counsel instead chose to present the issue in the form of a motion for a mistrial. Trial Transcript 2/8/05 (Dkt. No. 291) at 158-60. While that mistrial motion was denied, I provided the jury with a curative instruction, as follows:

First, statements were made during the Sears parties’ opening regarding the size of Cargill and the relative size of Cargill and the Sears entities. As I stated at the outset to you, you must perform your duty as jurors without bias or prejudice as to any party. The law does not permit you to be governed by sympathy, prejudice or public opinion. Your verdict must be based solely upon the evidence developed at trial or the lack of evidence considered in light of my instructions concerning the applicable law. In reaching your decision, it would be improper for you to consider any personal feelings you may have about any party’s status or size. All parties expect that you will carefully and impartially consider all of the evidence, follow the law as it is being given to you at the close of the case, and reach a verdict regardless of the consequences. Simply stated, the parties in this case are entitled to be treated equally. All persons are equal before the law, of equal worth and station in life, and each party is therefore entitled to the same fair and conscientious consideration by you as any other party.

Trial Transcript 2/9/05 (Dkt. No. 292) at 200-01. This remedial instruction was augmented by the customary, prophylactic charge, administered both prior to and at the close of the case, to the effect, in substance, that each party, regardless of size, is entitled to the same fair consideration, Trial Transcript 2/9/05 (Dkt. No. 292) at 200-01; Trial Transcript 3/3/05 (Dkt. No. 397) at 3204, and additionally that arguments of counsel do not constitute evidence, Trial Transcript 2/7/05 (Dkt. No. 290) at 64, 84; Trial Transcript 2/9/05 (Dkt. No. 292) at 201-02; Trial Transcript 3/3/05 (Dkt. No. 397) at 3205-07. These instructions, which the jury is presumed to have followed, see Richardson v. Marsh, 481 U.S. 200, 206, 107 S.Ct. 1702, 1707, 95 L.Ed.2d 176 (1987), eliminated any prejudice potentially suffered by Cargill as a result of comments by defendants’ counsel regarding relative size.

b. The Court’s Conduct at Trial

While breathing life into the cold record upon which appellate review of this case will be based is impossible, I will attempt to inject at least some context into the discussion of Cargill’s claim of misconduct on the part of the court by first setting the stage. Anyone who participated in or witnessed the trial in this matter appreciates that it involved highly complex legal and factual issues which presented daunting challenges to the jury, comprised as it was of seven hardworking and attentive individuals with no particular technical expertise in the subject matters involved, and quite frankly, to the' court as well. And, as is often the case with litigated matters involving intellectual property-rights, the atmosphere was at times tense, and pressure packed, with hotly contested issues presented at every turn.

Seemingly taking a cue from recent events suggesting an open season for unprecedented levels of criticism of the judiciary, Cargill has chosen to turn its sights on the court, arguing that as a result of my efforts to control the level of intensity at trial through occasional use of benign humor, and additionally by making various adverse evidentiary rulings, I deprived Cargill of a fundamentally fair trial. The essence of plaintiffs court misconduct argument is that through my actions and comments, I effectively signaled to the jury that it should rule in favor of the Sears parties.

The arguments of court misconduct which Cargill now makes in support of its new trial motion are new to the scene. At no time during the course of the trial, during which the court’s relationship with counsel for the parties seemed both professional and collegial, with virtually daily conferences conducted in chambers after the jury was released, did Cargill’s attorneys suggest or even intimate their belief that either they or their client had been unfairly treated by the court. Not until the jury returned its adverse verdict did Cargill resort to making this claim.

Having reflected on the matter and carefully reviewed the trial record, in the light of Cargill’s claims of court misconduct, I find no basis to conclude that a new trial is warranted. None of the comments now seized upon by Cargill in support of its motion were intended to influence the jury, nor is there any reason to believe that they were construed otherwise. Moreover, the jury was specifically instructed to the effect that nothing said by the court should be considered as indicating a belief as to what its verdict should be. Trial Transcript 2/7/05 (Dkt. No. 290) at 64; Trial Transcript 3/3/05 (Dkt. No. 397) at 3203-04.

The cases relied upon by Cargill in the portion of its motion addressed to the court’s conduct are wholly inapposite, involving conduct not at all comparable to the matters alluded to in its motion. In Caskey v. Village of Wayland, for example, the Second Circuit found that in its jury instructions the court had made statements, characterized as “pejorative in nature”, regarding remarks of plaintiffs counsel on the question of damages, conveying the court’s impression that in requesting a large award “counsel somehow had acted improperly and ... the damages being sought were exorbitant.]” 375 F.2d 1004, 1009 (2d Cir.1967). Similarly, the statements relied upon by the court in Rivas v. Brattesani, 94 F.3d 802, 803, 807-08 (2d Cir.1996), in ordering a new trial, were caustic and direct, and plainly conveyed the court’s negative impressions regarding both the defendants and their counsel. In this instance, by contrast, none of the comments relied upon by Cargill in its motion were either intended, or could be reasonably construed, to disparage Cargill or its counsel.

In sum, while on appellate review the Federal Circuit may well take issue with some of the many rulings made during the course of the trial, I am unable to say that based upon those rulings or the court’s various offhand and innocuous remarks, none of which were directed at or derogatory to either Cargill or its counsel, plaintiff was deprived of a fair trial.

c. The Conduct of Sears’ Counsel at Trial

In its motion, Cargill complains of various conduct on the part of Sears’ counsel, extending beyond mere reference to the relative sizes and resources of the parties, including 1) making of “speaking objections”; 2) vouching for witness credibility; 3) suggestions of impropriety on the part of Cargill’s counsel; and 4) generally engaging in “grandstanding”.

A party seeking a new trial on the basis of the conduct of trial counsel, and in particular allegedly improper statements in the jury’s presence, is confronted with a substantial burden; “[rjarely will an attorney’s conduct so infect a trial with undue prejudice or passion as to require reversal.” Reilly v. Natwest Markets Group Inc., 181 F.3d 253, 271 (2d Cir.1999) (citation and internal quotation marks omitted), cert. denied, 528 U.S. 1119, 120 S.Ct. 940, 145 L.Ed.2d 818 (2000). When a jury’s verdict is supported by the evidence at trial, statements improperly made by trial counsel are generally regarded as de minimis when placed in the context of the trial as a whole. Marcic v. Reinauer Transp. Cos., 397 F.3d 120, 124 (2d Cir.2005) (citing Pappas v. Middle Earth Condo., Ass’n, 963 F.2d 534, 540 (2d Cir.1992)).

As I have already noted, this matter was fiercely litigated. Both counsel at times challenged the court’s patience and endeavored to test boundaries that had previously been set. While Cargill complains of such conduct on the part of Sears’ counsel, that conduct was no more egregious than the litigation strategy employed by Cargill, whose counsel made a fair share of the objections at trial and was equally critical of Sears and its witnesses as, it now contends, was Sears’ counsel of witnesses testifying on behalf of Cargill.

Having reviewed the specifics offered by Cargill in support of its claim of misconduct on the part of Sears’ counsel, I can find no basis to conclude that a new trial is warranted. While Sears’ counsel did offer fair comment on certain matters, including witness credibility, at no time did any of its attorneys cross the line and vouch for the credibility of any witnesses. Moreover, while it is true that various statements were made concerning Cargill and its motivations, in many respects those were in response to, and no more egregious than, Cargill’s attempt to portray the Sears parties as unduly litigious in their efforts to protect and enforce the ’793 patent. Accordingly, and based upon my finding that the jury’s verdict is amply supported by the evidence in the record and none of the conduct alluded in Cargill’s motion so infected the process as to deny Cargill its right to a fair trial, this portion of Cargill’s motion will be denied.

d. Various Alleged Emrs in Eviden-tiary Rulings and Jury Instructions

In support of its contention that it did not receive a fair trial, Cargill advances several contentions, many of which seek merely to rehash arguments already made and rejected — in some instances on multiple occasions. Other portions of Cargill’s motion address evidentiary rulings made during the course of the trial, and jury instructions now claimed by plaintiff to have been erroneous. Having reviewed the matter, I find that none of the issues now raised in this portion of Cargills motion rise to a level sufficient to support the request for a new trial, those arguments instead being more appropriately reserved for presentment to an appellate court.

2. Weight of the Evidence

Among the arguments now raised by Cargill is its claim that the finding that Sears disclosed trade secret information during the August, 1999 meeting is against the weight of the evidence. While the evidence is conflicting on this score, with certain of Cargill’s witnesses having denied receiving trade secret information during the August, 1999 meeting that was not freely disclosed earlier, when no confidentiality agreement was in place, there was evidence, including in the form of David Wood’s testimony, to support the jury’s finding. E.g., Trial Transcript 2/17/05 (Dkt. No. 364) at 1558, 1570-71, 1587-88. Wood’s testimony in this regard is buttressed by the fact that immediately following the meeting, Cargill researchers markedly shifted their course and began exploration of the use of cane molasses as a source of low molecular weight carbohydrates to be utilized in a liquid de-icer. These facts provide a sufficient basis to uphold the jury’s verdict with regard to the trade secret misappropriation.

3. Correction of the Jury’s Damage Calculation

In its motion, Cargill also implores the court to rectify what it characterizes as an obvious miscalculation reflected in the jury’s award of patent damages based upon a reasonable royalty theory. Cargill argues that the evidence presented at trial reflected its sale of ClearLane Treated Salt only through January 31, 2005, and quarrels with what appears to be the jury’s extrapolation of available figures to account for sales between February 1, 2005 and the date of its verdict on March 10, 2005. Cargill maintains that the error can be explained by speculation on the part of the jury that it sold 200,000 tons of ClearLane Salt between February 1, 2005 and the date of the verdict, yielding a royalty of $300,000, and asserts, based upon information which was not made available to the jury or defendants’ counsel during the trial, that the figure is unduly inflated in light of the fact it sold only 101,193 tons of the accused product during that time period. See Plaintiffs Reply Memorandum (Dkt. No. 415) at 1.

The fact that information regarding Car-gill’s pre-verdict sales is now available stands in marked contrast to the situation presented at trial. Both prior to and during the course of the trial Sears was forced to elicit the court’s assistance in order to receive even the most basic of information, undoubtedly at Cargill’s ready disposal, concerning the sales of the infringing ClearLane Treated Salt products. Dkt. Nos. 254; 290, at 11-16. In light of its recalcitrance to provide the requested information, which would perhaps have allowed the jury to make a more precise and informed calculation of reasonable royalties, Cargill cannot now be heard to challenge the jury’s verdict and its reasonable assumption concerning the continued level of sales of the accused products, based upon evidence developed only after return of the jury’s verdict. Compare Jay Edwards Inc. v. New England Toyota Distributor, Inc., 708 F.2d 814, 821-22 (1st Cir.), cert. denied, 464 U.S. 894, 104 S.Ct. 241, 78 L.Ed.2d 231 (1983) (defendant could not object to jury’s reasonable interpretation of plaintiffs damages evidence after the fact when it could have come forward with its own evidence) with Sequa Corp. v. GBJ Corp., 156 F.3d 136, 142-45 (2d Cir.1998) (allowing remand for recalculation of damages when district court based calculation on unforeseen theory and neither party had opportunity to present evidence; distinguishing situation where a party objects after the fact when it had opportunity to present its own evidence). Accordingly, I find no basis to invade the jury’s province and usurp its function by recalculating damages.

In sum, I have carefully reviewed the record in light of Cargill’s various arguments, and find no basis to conclude that it was denied a fundamentally fair trial, or that there is a basis to vacate the judgment entered and order a new trial.

C. Cargill’s Motion for JMOL on Patent-Related Issues

In one of its post-trial motions, plaintiff has sought relief from certain patent-related aspects of the jury’s verdict. Cargill’s motion calls upon the court to address a variety of issues, most of which have been thoroughly aired in prior settings, surrounding the Sears parties’ patent infringement claims and its defenses to those claims.

1. Vagueness Of Claim Construction

In its motion, Cargill renews its complaints regarding the vagueness of the court’s construction of the claims contained within the ’793 patent. Echoing. arguments rejected prior to trial, see Decision and Order dated January 18, 2005 (Dkt. No. 205) at 9-12, Cargill essentially requests that I redraft the ’793 patent to import into it bright lines of demarcation for various of the chemical constituents described in the patent claims by extrapolation from examples cited by the inventors. Urging the court to do its duty under Markman v. Westview Instruments, Inc., 517 U.S. 370, 116 S.Ct. 1384, 134 L.Ed.2d 577 (1996), Cargill requests quantification of such terms of “incidental impurities”, “harmless ingredients”, “refined and consistent source” and “incidental amounts of insoluble components” and suggest that the failure to more adequately define those terms for the jury requires the entry of JMOL in its favor.

For the reasons set forth in my earlier decision I decline Cargill’s invitation, finding it inappropriate for the court to engage in claim drafting, as opposed to claim construction.,

2. Infringement Under Doctrine of Equivalents

Renewing its earlier argument that by operation of prosecution history estoppel Sears has relinquished its ability to assert infringement under the doctrine of equivalents, Cargill seeks the entry of JMOL setting aside the jury’s finding of infringement of claims four, five, six and eight. The essence of plaintiffs argument is that by virtue of representations by the ’793 inventors to the patent examiner, Sears has essentially forfeited its right to claim that the thickener referenced in claims four, five, six and eight of the ’793 patent could be inherent in, rather than added to, the other ingredients of the de-icing agent at issue.

As Cargill now argues, a patentee may be estopped from alleging infringement under the doctrine of equivalents when, in response to rejection of an initial application for reasons related to patenta-bility, including based upon prior art, the rejection results in a subsequent narrowing of a claim by the inventors. Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co., Ltd., 535 U.S. 722, 733-34, 122 S.Ct. 1831, 1838, 152 L.Ed.2d 944 (2002); Glaxo Wellcome, Inc. v. Impax Labs., Inc., 356 F.3d 1348, 1351-53 (Fed.Cir.2004) (discussing Festo). The mere fact of such a narrowing amendment, however, does not automatically preclude the paten-tee from claiming infringement by equivalents; instead, careful examination of the circumstances surrounding the narrowing amendment is required before invoking prosecution history estoppel. Festo Corp., 535 U.S. at 735-37, 122 S.Ct. at 1839-40; Glaxo Wellcome, Inc., 356 F.3d at 1353-56.

The question of whether claims four, five, six and/or eight were infringed under the doctrine of equivalents by plaintiffs ClearLane Treated Salt products was submitted to the jury, along with an explanation of the concept of prosecution history estoppel and its potential impact upon infringement under the doctrine of equivalents. Trial Transcript 3/3/05 (Dkt. No. 397) at 3225-27. The jury’s verdict, finding infringement of the relevant claims under the doctrine of equivalents, reflects its rejection of Cargill’s prosecution history estoppel argument. That portion of the jury’s verdict is amply supported by the evidence adduced at trial, including chiefly the testimony of defendants’ expert, Professor Bruce Nauman.

The question of whether the examiner’s criticism of the patent application as not sufficiently distinguishing between the low molecular weight carbohydrates specified as one of the key ingredients in the patent invention and the thickeners claimed, coupled with the subsequent placing of limits upon those thickeners in order to provide a clear line of demarcation, should result in preclusion of a finding of infringement under the doctrine of equivalents, was addressed in my first post-trial decision and order, dated April 12, 2005. Dkt. No. 358, at 16-18. In that decision I also reviewed the record and concluded that the jury’s finding of infringement of claims four, five, six and eight under the doctrine of equivalents by Cargill’s Clear-Lane Treated Salt products was adequately supported by evidence in the record. Id. Having reviewed those findings once again in the context of Cargill’s most recent submissions, I find no basis to override my earlier determination on the issue now presented.

3. Dedication of Composition Containing Molasses, Salt and Water to the Public

In its motion addressed to patent law issues, Cargill also raises an argument which has not been prominent in its prior submissions. In essence, Cargill argues that through reference to the use of molasses as a thickener in their January, 1999 patent application, coupled with their failure to disclose or claim any composition specifically containing molasses in the ’793 patent, the inventors have effectively dedicated de-icing compositions comprising in part of molasses into the public domain. As support for this position Cargill cites several cases, including Maxwell v. J. Baker, Inc., 86 F.3d 1098, 1106 (Fed.Cir.1996), cert. denied, 520 U.S. 1115, 117 S.Ct. 1244, 137 L.Ed.2d 327 (1997).

As a relative newcomer to the scene, this argument was not raised during the course of the trial in any motion advanced by Cargill for JMOL under Rule 50 of the Federal Rules of Civil Procedure. Since the argument was not properly preserved in such a fashion or otherwise, Car-gill is precluded from now seeking JMOL on this “dedicated to the public” argument. Nadel v. Isaksson, 321 F.3d 266, 271-72 (2d Cir.2003).

Turning to the substance of Car-gill’s belated dedication argument, I find that it lacks merit and that the Federal Circuit’s decision in Maxwell is readily distinguishable. That case dealt with subject matter disclosed in a patent specification but not included in the patent claims. 86 F.3d at 1106-07. Responding to that set of circumstances, the Federal Circuit observed that it has “frequently applied [the dedication] rule to prohibit a finding of literal infringement when an accused infringer practices disclosed but unclaimed subject matter.” Id. at 1107 (citing Environmental Instruments, Inc. v. Sutron Corp., 877 F.2d 1561, 1564 (Fed.Cir.1989)).

The rationale for invoking such a dedication rule is readily apparent from the court’s decision in Maxwell; the rule was intended to prevent a patentee from narrowly claiming an invention and later being permitted, whether under a claim of literal infringement or under the doctrine of equivalents, to contend that it also covers far broader subject matters than those disclosed, but not claimed. Maxwell, 86 F.3d at 1107. This case presents the inverse situation, where Cargill challenges a broad specification of low molecular carbohydrates, of which cane molasses is one of many potential sources, claiming that by the more narrow citing of cane molasses as an example of such a source without specifically referencing that source in the patent claims, it has been dedicated to the public. This, then, is not a situation where subject matter such as the use of cane molasses is disclosed in a specification but not encompassed within a specific patent claim. This portion of Cargill’s motion is therefore also subject to denial, both procedurally and on the merits.

4. Sufficiency of Evidence of Infringement

Despite a wealth of evidence to the contrary, Cargill argues for JMOL claiming that its ClearLane Treated Salt products do not infringe claims one, two, three, five and seven of the ’793 patent, and that no reasonable jury could conclude otherwise. Cargill’s challenge to the finding of infringement centers upon its contention that 1) the cane molasses which serves as an ingredient of its ClearLane products is not a refined and consistent source of low molecular weight carbohydrates, as contemplated in the ’793 patent; 2) its product also contains carbohydrates falling outside of the molecular weight ranges specified in the patent; 3) Clear-Lane Liquid does not meet the aqueous solution requirement of the patent; and 4) its accused products do not satisfy the “balance” requirement as set forth in the court’s construction of the ’793 patent claims.

Cargill’s arguments relating to non-infringement must be examined in the context of the position which it took at trial, as illuminated by its counsel’s opening statement, readily acknowledging that the accused Cargill products contain carbohydrates, chloride salts and water falling within the ranges specified in the ’793 patent. Trial Transcript 2/7/05 (Dkt. No. 290) at 103. Had this concession not been made, moreover, the jury’s finding of infringement would nonetheless be supported. The evidence presented at trial, including though not limited to the testimony of Professor Bruce Nauman, demonstrated that not only does the accused ClearLane Liquid contain low molecular weight carbohydrates, chloride salts, and water falling within the ranges specified in the ’793 patent, but that it meets the other requirements of claims one, two, three and seven of that patent, as construed by the court. Drawing upon information provided concerning its ClearLane products including in its material safety data sheets (“MSDS”) and interrogatory answers, as well as independent laboratory testing conducted by BodyCote, Professor Nauman observed that the cane molasses utilized to make Cargill’s infringing ClearLane products represented a consistent and refined source and provided low molecular weight carbohydrates within the ranges claimed in the ’793 patent. Professor Nauman also testified that plaintiffs product meets the court’s definition of an aqueous solution as representing “a uniformly disbursed liquid mixture of two or more components, one of which is water, and which can contain incidental amounts of insoluble components.”

Cargill’s argument with regard to evidence concerning the “balance” constituent is equally unavailing. While Cargill contends that according to the testimony at trial, the cane molasses utilized to manufacture its ClearLane products contains at least twenty-five percent of soluble materials other than low molecular weight carbohydrates, including inorganic materials and other carbohydrates, as well as additional constituents, it overlooks the court’s construction of the term “balance” which can include “incidental impurities or harmless ingredients associated with the commercial sources of the key components in the inventionf.]” Cargill, 334 F.Supp.2d at 220-21.

In sum, the arguments now raised by Cargill to challenge the finding of direct infringement of claims one, two, three and seven of the ’793 patent provide no basis to set aside that portion of the jury’s verdict.

5. Patent Invalidity/Priority Date

Characterizing the question of priority date as an affirmative defense asserted by the Sears parties to counter plaintiffs own anticipation and obviousness invalidity defenses, on which it acknowledges it bears the burden of proof by clear and convincing evidence, Cargill argues that at trial it was incumbent upon Sears to prove entitlement to the January 4, 1999 priority date with respect to the ’793 patent by a preponderance of the evidence. Cargill claims that the court therefore improperly allocated the burden of proof with regard to priority date, asking the jury to measure priority date utilizing the clear and convincing evidence standard applicable to Cargill’s invalidity defense. Cargill further asserts that the matter of priority date is one of law addressed to the court, rather than for the jury to decide.

This and Cargill’s other invalidity argument must be analyzed against the backdrop of the independent presumption of validity which, by statute, attaches to each claim contained within a regularly issued patent under 35 U.S.C. § 282. Continental Can Co., USA, Inc. v. Monsanto Co., 948 F.2d 1264, 1266-67 (Fed.Cir.1991). Under section 282, a “party asserting invalidity not only has the procedural burden of proceeding first and establishing a prima facie case, but the burden of persuasion on the merits remains with that party until final decision.” Stratoflex, Inc. v. Aeroquip Corp., 713 F.2d 1530, 1534 (Fed.Cir.1983); see also ConMed Corp. v. Erbe Electromedizin GmbH, 241 F.Supp.2d 187, 192 (N.D.N.Y.2003) (citing, inter alia, Stratoflex), vacated due to settlement, No. 00-CV-987, 2004 WL 1576596 (N.D.N.Y. June 29, 2004). Any party seeking to overcome this presumption of validity must do so by clear and convincing evidence. Rosco, Inc. v. Mirror Lite Co., 304 F.3d 1373, 1377 (Fed.Cir.2002) (citations omitted); see also Ralston Purina Co. v. Far-Mar-Co., Inc., 712 F.2d 1570, 1573-74 (Fed.Cir.1985).

Plaintiffs invalidity challenges implicate the sufficiency of the written description of the earlier applications under 35 U.S.C. § 112. “A party asserting invalidity based on 35 U.S.C. § 112 bears no less a burden and no fewer responsibilities then any other patent challenger.” Ralston Purina, 772 F.2d at 1574.

Cargill's priority date argument conflates the concepts of burden of proof with the shifting burdens of production implicated in this case. As plaintiff correctly notes, a party such as Cargill who asserts patent invalidity bears the initial procedural burden of establishing a prima facie case of invalidity. Ralston Purina Co., 772 F.2d at 1573-74. When this burden has been successfully shouldered, the burden of production turns to the patentee to demonstrate patent validity. Id. Nothing in the Federal Circuit’s decision in Ralston Purina or any subsequent decision suggests that the ultimate burden of proof is also shifted upon a showing of a prima facie case of invalidity, as is now asserted by Cargill.

In its post-trial motion related to priority date, Cargill also stubbornly adheres to its position that Federal Circuit decisions involving interference proceedings may be applied to invalidity claims asserted in defense of infringement claims such as this, citing such cases, inter alia, as Cooper v. Goldfarb, 154 F.3d 1321 (Fed.Cir.1998). Those interference proceeding cases, however, are inapposite in infringement actions where invalidity is asserted as an affirmative defense. See Ralston Purina Co., 772 F.2d at 1574 n. 2.

Cargill’s motion also challenges the sufficiency of evidence to support the jury’s finding of defendants’ entitlement to the January 4, 1999 priority date even assuming that it retains the burden on the question of priority date. The evidence adduced at trial, however, demonstrates that the jury’s finding that Cargill had not satisfied its burden of discounting the January 4, 1999 priority date by clear and convincing evidence is supported. Sears’ expert, Professor Nauman, explained the usage of the critical terms in the January 4,1999 and January 5, 2001 patent applications. Utilization of the term “sugars (hexoses, saccharides)” in the earlier application instead of the low molecular weight language and images in the later, CIP application, according to Professor Nau-man, would have been understood by a person of ordinary skill in the art to reference carbohydrates with molecular weights ranging from 180 (hexoses) to about 1476 (oligosaccharides). This is consistent with the claims of the ’793 patent, which disclosed carbohydrates in the same approximate low molecular weight ranges. The testimony of such an expert may constitute “substantial evidence” on the question of validity. E.g., Teleflex, Inc. v. Ficosa N. Am. Corp., 299 F.3d 1313, 1333-34 (Fed.Cir.2002).

6. Anticipation and Obviousness

In the verdict form provided for its use the jury was asked, on a claim by claim basis, whether the ’793 patent was anticipated and/or obvious. In its response, the jury uniformly found that the ’793 patent claims were neither obvious nor anticipated. Renewing arguments fully vented on several prior occasions, Cargill again argues that no reasonable jury could have reached this conclusion based upon the evidence adduced at trial.

One way in which a patent may be found to be invalid is through anticipation. A patent claim is invalid if “the invention was patented or described in a printed publication in this ... country ... more than one year prior to the date of the application for patent in the United States[.]” 35 U.S.C. § 102(b). Under this statutory provision addressing anticipation, “[a] patent is invalid for anticipation if a single prior art reference discloses each and every limitation of the claimed invention.” Schering v. Geneva Pharms., Inc., 339 F.3d 1373, 1377 (Fed.Cir.2003) (citing Lewmar Marine, Inc. v. Barient, Inc., 827 F.2d 744, 747 (Fed.Cir.1987)). As the Federal Circuit has noted,

invalidity by anticipation requires that the four corners of a single, prior art document describe every element of the claimed invention, either expressly or inherently, such that a person of ordinary skill in the art could practice the invention without undue experimentation.

Advanced Display Sys., Inc. v. Kent State Univ., 212 F.3d 1272, 1282 (Fed.Cir.2000), cert. denied, 532 U.S. 904, 121 S.Ct. 1226, 149 L.Ed.2d 136 (2001). Whether a patent claim is anticipated is a question of fact. Advanced Display Sys., Inc., 212 F.3d at 1281. And, because it implicates invalidity, an anticipation defense interposed by an accused infringer is subject to a clear and convincing evidence burden of proof. See Ralston Purina Co., 772 F.2d at 1574.

Cargill’s claim of anticipation is based upon cited prior art references which have been discussed previously, and distinguished. Uniformly, those prior art references address the manufacture of deicing products using a variety of agricultural waste products including brewers condensed solubles (“BCS”), distillers condensed solubles (“DCS”), and cornsteep — a product remaining after the wet milling of corn. The prior usage of such products to manufacture de-icing agents was disclosed and discussed in the ’793 patent application, and distinguished based upon the fact that those products did not represent a source of low molecular weight carbohydrates meeting the court’s requirement that it be refined and consistent. None of the prior art references reiterated by Car-gill in support of its motion undermine the jury’s verdict and establish that no reasonable factfinder could have concluded that it did not establish anticipation by clear and convincing evidence.

As a related but distinct axiom of patent law, an inventor is also not entitled to a patent if his or her invention would have been obvious to a person of ordinary skill in the field of the invention at the time the invention was made. 35 U.S.C. § 103. As the standard implies, unlike anticipation the obviousness test “is whether the combined teachings of the prior art, taken as a whole, would have rendered the claimed invention obvious to one of ordinary skill in the art.” In re Napier, 55 F.3d 610, 613 (Fed.Cir.1995).

The prior art references offered by Cargill in support of its obviousness claim are essentially those urged in its anticipation defense. All of the cited references, however, address de-icing products derived from waste materials. Rather than rendering the ’793 patent obvious, these references teach away from reliance upon a refined and consistent source of low molecular weight carbohydrates such as cane molasses. There was ample evidence rejecting Cargill’s obviousness defense, and the jury’s verdict in this regard was therefore well supported.

7. Inventorship

At trial, Cargill challenged the validity of the ’793 patent based upon the failure of the applicants to accurately name the inventors of the subject matter disclosed. In support of that argument, Car-gill argued that David Wood was not truly an inventor of any of the subject matter disclosed in the patent, and that Bodycote Ortech contributed to the invention in a sufficiently significant way as to require its inclusion on the patent application as a named inventor. In its motion, Cargill maintains that no reasonable factfinder could have concluded that it did not carry its burden of demonstrating invalidity based upon improper inventorship by clear and convincing evidence.

The evidence at trial, interpreted in a light most favorable to Sears, plainly demonstrated David Wood’s collaboration and contribution to the process leading to the invention forming the basis of the ’793 patent. Having identified a need for an improved de-icing product Wood, in collaboration with Robert Hartley, a chemist hired by him to consult regarding the issue, through testing conducted by Body-cote Ortech at Hartley’s directive, determined that carbohydrates from a refined and consistent source, as David Wood sought to achieve, could, when combined with a chloride salt and water, provide a synergistic freezing point depressive effect. David Wood thus had more than merely passing involvement with the invention leading to the ’793 patent.

In contrast Bodycote Ortech, which Car-gill asserts was a co-inventor, served as no more than a commercial laboratory performing testing at the request of, and in consultation with, both Robert Hartley and David Wood. Such activities do not render Bodycote Ortech “inventors” within the meaning of the patent law. Burroughs Wellcome Co. v. Barr Labs., Inc., 40 F.3d 1223, 1229-31 (Fed.Cir.1994), cert. denied, 516 U.S. 1070, 116 S.Ct. 771, 133 L.Ed.2d 724 (1996).

In sum, the jury’s verdict regarding the inventorship issue is adequately supported by the evidence in the record.

8. Inequitable Conduct

In its motion, Cargill also challenges the court’s rejection of its claim of inequitable conduct on the part of the ’793 inventors, as well as the jury’s finding upon which that determination was predicated.

The defense of patent unen-forceability, based upon inequitable conduct, is “entirely equitable in nature, and thus not an issue for a jury to decide.” Perseptive Biosystems, Inc. v. Pharmacia Biotech, Inc., 225 F.3d 1315, 1318 (Fed.Cir.2000). When addressing a claim of inequitable conduct based upon a patentee’s failure to disclose information to the patent examiner, the court must focus upon whether 1) information not revealed was material and, additionally, 2) in failing to communicate the information, the inventors intended to deceive or mislead the PTO. See Molins PLC v. Textron, Inc., 48 F.3d 1172, 1178 (Fed.Cir.1995). Unen-forceability based upon inequitable conduct must be proven to the court’s satisfaction by clear and convincing evidence. Seiko Epson Corp. v. Nu-Kote Int'l, Inc., 190 F.3d 1360, 1367 (Fed.Cir.1999).

Confronted with Cargill’s claim of inequitable conduct, I followed the procedure outlined in Herman v. William Brooks Shoe Co., No. 95 CIV. 1324, 1998 WL 832609, at *5 (S.D.N.Y. Dec. 1, 1998), initially asking the jury, in an advisory capacity, to address the threshold questions of materiality and intent to deceive, with the aim of determining, based upon the jury’s findings and after weighing the questions of materiality and intent to deceive, whether the patent should be declared unenforceable based upon inequitable conduct.

In its verdict the jury found that material and non-cumulative information, to the effect that Caliber — a product similar to that disclosed in the ’793 patent — was being offered for sale and had in fact been sold, was known to the inventors prior to issuance of the patent and should have been disclosed to the PTO, but was not. The jury went on to find, however, the lack of any intent on the part of inventors Wood and Hartley to deceive the PTO by their failure to disclose their awareness of the Caliber product sales. Based upon those findings, and particularly the absence of any intent to deceive — which finding is well supported by the record — I concluded that the patent was not unenforceable on the basis of inequitable conduct. See Decision and Order dated April 12, 2005 (Dkt. No. 358) at 29. Having reviewed the record in light of Cargill’s arguments, I find no basis to set aside my ruling on this defense.

9. Equitable Ownership By SEACO

In its motion Cargill argues that SEACO, which benefited from the jury’s verdict on the patent-related counterclaim only to the extent of the imposition of equitable relief, did not own the ’793 patent and thus lacked standing to sue under the patent.

As I noted in my earlier post-trial decision, from a purely corporate law point of view SEACO and Sears Petroleum are unquestionably distinct entities. Nonetheless, SEACO, Sears Petroleum and Sears Oil are significantly intertwined, with considerable commonality of officers and personnel, including David Wood, as well as ownership. SEACO is a wholly owned subsidiary of Sears Petroleum, and the two companies file a single, combined tax return.

During the course of the trial SEACO, while not allowed to recover damages, was permitted to participate in the pursuit of the patent infringement counterclaims and to enjoy the benefit of the equitable relief entered by the court, based upon the jury’s finding of infringement. My decision to permit SEACO’s pursuit of those claims was in recognition of the fact that equitable title to a patent has been recognized by the Federal Circuit to exist in circumstances involving “the beneficial interest of one person whom equity regards as the real owner, although the legal title is vested in another.” Arachnid, Inc. v. Merit Indus., Inc.,