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February 27, 1959


The opinion of the court was delivered by: Juergens, District Judge.

This litigation was commenced by the plaintiff Armour Research Foundation of Illinois Institute of Technology (hereinafter referred to as Armour) against C.K. Williams & Co., Inc. (hereinafter referred to as Williams), defendant in Civil Action No. 3200 and plaintiff Armour against Technical Tape Corporation (hereinafter referred to as Technical Tape), defendant in Civil Action No. 3438. Minnesota Mining and Manufacturing Company (hereinafter referred to as Minnesota) was subsequently, by order of this Court, brought in as a necessary party plaintiff. The two suits were consolidated for trial.

The plaintiffs charge infringement by the defendants of United States Letters Patent No. 2,694,656, issued to Marvin Camras, who filed his application with the United States Patent Office on July 25, 1947. The patent issued November 16, 1954. The inventor Marvin Camras assigned the patent to Armour. Minnesota is an Armour licensee and has the exclusive right to grant sub-licenses under the patent.

The defendants filed their separate answers to the respective complaints, alleging invalidity and unenforceability of the patent and denying infringement. In addition, Williams filed its counterclaim seeking an adjudication of the invalidity and non-infringement of the patent in suit and counterclaimed against both plaintiffs for violation of the Anti-Trust Law.

This Court has jurisdiction under the patent laws of the United States.

In support of their allegations of infringement the plaintiffs rely on claims 3, 8, 10, 14, 25 and 26 of the patent in suit. These claims are as follows:

    "3. A ferromagnetic iron oxide material adapted to
  form an element of a magnetic impulse record member,
  said material consisting essentially of acicular
  crystalline particles uniformly small in size and not
  over 6 microns in their greatest dimension of a
  synthetic magnetic oxide of iron selected from the
  group consisting of magnetic ferrosoferric oxide
  Fe3O4, and magnetic gamma ferric oxide,
  Fe2O3, the selected synthetic magnetic oxide
  of iron having a cubic lattice structure, and said
  material having a coercive force value of between 200
  and 550 oersteds and a ratio of Bfm/Br at
  H-1000 of not over 3 to 1.
    "8. The method of making permanent magnet material
  which comprises precipitating a non-magnetic ferric
  oxide from solution in acicular crystalline form,
  heating said non-magnetic ferric oxide in a reducing
  hydrogen atmosphere to a temperature of about 750° F.
  for a sufficient length of time to reduce said ferric
  oxide to a magnetic ferrosoferric oxide, cooling the
  ferrosoferric oxide in the presence of a reducing
  atmosphere to room temperature and then exposing said
  ferrosoferric oxide to the air to recover a
  ferrosoferric oxide having a coercive force value
  between 200 and 550.
    "14. The method of making magnetic iron oxide which
  comprises providing a synthetic non-magnetic ferric
  oxide in acicular crystalline form and of particle
  size not over 6 microns in its greatest dimension,
  reducing said non-magnetic oxide at elevated
  temperatures to produce a ferrosoferric oxide and
  oxidizing said ferrosoferric oxide to gamma ferric
  oxide having permanent magnet properties including a
  coercive force of at least 200 oersteds.
    "25. Ferromagnetic iron oxide selected from the
  group consisting of a synthetic ferrosoferric oxide,
  Fe3O4, and of a synthetic gamma ferric oxide,
  Fe2O3, adapted to form an element of a
  magnetic impulse record member, said iron oxide
  consisting essentially of uniformly small elongated
  crystals of less than about 1.5 microns maximum
  dimension having a length-to-width ratio of about 2.5
  to 1 and higher, and having a cubic crystal lattice
  structure and a coercive force, Hc, within the
  range of 245 to 330 and remanence, Br, of above
  about 500 gauss.
    "26. A magnetic impulse record member having a
  non-magnetic carrier and a coating adherently bonded
  thereto of a binder and magnetic material, said
  magnetic material being the ferromagnetic iron oxide
  defined in claim 25 and having a Br versus H
  characteristic that rises most rapidly at fields
  between 200 and 600 oersteds and relatively slowly at
  fields between 0 and 200 oersteds and at fields above
  600 oersteds."

The patent in suit relates to a permanent magnetic material and to a method of making same. This permanent magnetic material is then impregnated or coated on a non-magnetic carrier to produce a magnetic impulse record member.

Magnetic recording was first discovered prior to the beginning of the present century by Valdemar Poulsen, a Danish physicist. He found that a mass of magnetizable material may be impressed with impulses varying in intensity in successive adjacent portions of the magnetizable mass which will retain these impulses. It was learned that a sound wave could be converted into a varying electric signal and it was further determined that by energizing an electromagnet with the electric signal a corresponding magnetic signal would be impressed on the record member as the record member was caused to pass over the electromagnet. It was further observed that when the same record member was again moved past the same or a similar electromagnet, an electric signal would be introduced into the electromagnet corresponding to the magnetic signal which had been impressed on the record member by its prior exposure to the effects of the electromagnet. These early experiments were in great part conducted using wire or metal tapes as the record member.

During the period referred to above the magnetic recording art in the United States was limited to the use of wire or tape. Iron oxides were not generally used as recording media in the United States until after the conclusion of World War II when the Brush Development Company of Cleveland, Ohio, placed on the market the Brush "Soundmirror". This machine used as a recording media a low coercive force magnetic oxide tape similar to that used by the Germans in their Magnetophon and Tonschreiber. The basic difference between the German and Brush machines was that the Soundmirror operated at a speed of 7½ inches per second. This speed has become the standard speed of American tape recorders.

While the work on the Soundmirror was progressing — it became the first American machine for home use — the Indiana Steel Products Company had produced a tape recorder designed to use high coercive force tapes in order to obtain high frequency response at low speeds. The tape used with this machine had a coercive force of around 250 oersteds and utilized a magnetic powder having particle sizes in the 1 micron range for the recording media. The coating material used on this tape was not the magnetic iron oxides claimed as an invention in the patent in suit nor was it similar to that used on the German tapes.

On June 1, 1946 Marvin Camras, the inventor of the patent in suit, applied for a patent on an "apparatus for magnetic recording" and on October 31, 1950 Patent No. 2,528,261 issued (Dx. N). In that patent he claimed as his invention a magnetic recorder designed to use a recording media having a permeability of less than 50 and a coercive force of over 100 oersteds, preferably over 250 oersteds. With the advent of this magnetic recorder the first great need for high coercive force and low permeability tapes arose.

On July 25, 1947 Marvin Camras filed his application and on November 16, 1954 the patent in suit was issued.

The important criteria of his patent, according to Mr. Camras, are:

(1) A relatively high coercive force, generally between 200 and 550 oersteds.

(2) Initial magnetization curve with a relatively gentle slope to an Ho point of about 250 gauss.

(3) A rapid rise from about 200 to 600 oersteds.

(4) A high remanence above about 500 gauss and a Bfm/Br ratio of less than 3 to 1.

(5) A synthetic material comprised of particles of preferably less than 1.5 microns and not more than 6 microns in maximum dimensions and consisting of acicular or elongated particles.

The defendants assert the invalidity of the patent and declare that the patent should not have been issued.

One of the asserted grounds of invalidity is that the oxides claimed as an invention by Camras are old in the art, as was also the use of magnetic iron oxides for magnetic impulse record members.

    "A suitable process for the preparation of the
  oxides in a very finely divided state consists in the
  decomposition of complex metal salts, as for example
  iron ammonium salts, or complex metal compounds which
  contain organic radicals such as pyridine. Such
  methods of preparing oxides are known per se, but it
  was hitherto not known that magnetic metal oxides
  when prepared in such a way are highly suitable for
  sound recording purposes * * *
    "It has been found that the oxides to be used
  according to this invention fulfil the said
  requirements to a high degree. The main reason for
  this is the extreme fineness and the very great
  uniformity in the size of the particles. For example
  it is possible to incorporate the magnetic material
  according to this invention in the sound record
  carrier in a particle size of 1/1000 millimetre or
  less; with the processes hitherto proposed for the
  purpose this is either impossible or only possible
  with difficulty. The magnetic properties of the
  oxides, in particular their induction and remanence
  with low field strengths, are favourable for their
  use as sound record carriers. The high coercive force
  ensures a good stability of the sound recording. * *
    "The following Examples will further illustrate how
  the said invention may be carried out in practice but
  the invention is not restricted to these Examples."

Johnson sets out five examples of methods of preparing oxides for use in the invention. However, the patent clearly indicates that the method of preparation of the oxide is not restricted to the examples.

The Patent Examiner rejected several claims of the Camras patent as being unpatentable over the Johnson British patent (p. 48, Dx. G). To overcome this objection (p. 48, Dx. G) Camras conducted experiments of three examples of the British patent. By following these methods low coercive force materials were obtained (pp. 63, 64, Dx. G).

On page 64 of this exhibit the effect of temperature upon the magnetic properties of hydroxides was illustrated. Crystals of Fe2O3.H2O in the form of light yellow acicular crystals of a particle size from ¼ to about 1½ microns in length and 1/10 to 3/10 microns in width were produced according to the reactions described in the Camras application. The resulting particles were then reduced in an atmosphere of hydrogen at temperatures of 300° F., 400° F. and 1200° for varying periods of time. The resulting oxides proved in the case of the 300° F. and 400° F. reductions to have coercive force values and remanence values too low to obtain a measurement, and in the case of the 1200° F. reduction a coercive force of 30 was attained.

Since Camras in his experiments failed to follow the teachings of the prior publications for the method of reducing both synthetic and natural iron oxides, it is not surprising that he obtained the low coercive force above indicated.

At the Inter-Partes demonstration at Easton, Pennsylvania, the Williams and Thewlis publication was followed in conducting the H series demonstration. In this demonstration the hydrate was reduced at 350° C. (R. 2049). The particles of the oxide produced in the H demonstration were found to be acicular and smaller than 1 micron in maximum dimension (R. 2051) (Dx. 1-B-1, p. 33). The oxides produced in this demonstration showed a coercive force of over 200 oersteds and a Bfm/Br ratio of less than 3 to 1 (R. 3166, 3167).

By following the teachings of the Williams and Thewlis publication, as was done at the Inter-Partes H demonstrations, an oxide clearly conforming to the patented oxide was obtained.

Another prior publication showing the effect of heat treatment on magnetic properties of iron oxides is found in the Kraeber and Luyken publication (Dx. 1-Z-1 and 1-Z-2).

This article was published in Germany in 1936 by the German-Kaiser-Wilhelm Institute. It discloses methods by which iron oxides may be reduced and oxidized in order to provide certain magnetic properties. At the Easton Inter-Partes demonstrations an oxide, identical to Camras' oxide, was produced by following the disclosures of the publication.

The plaintiffs contend that the article fails to anticipate the Camras patent, notwithstanding the fact that oxides identical to those disclosed in the Camras patent were produced by following the teachings of Kraeber and Luyken at the Easton demonstrations. They assert that the publication does not disclose the use of these oxides for magnetic recording media; that the Camras measurements, which are necessary in order to determine that the oxide sought has been obtained, are not disclosed anywhere in the article; and that the starting material used at the Easton demonstration was not the Merck iron hydroxide but rather was a product of the defendant Williams Company. This latter objection is strongly urged by the plaintiffs in their claim that the Camras oxide was not anticipated by this publication.

The defendants used a substitute hydroxide (a commercial product of defendant Williams known as YLO-1788); this iron hydroxide corresponds to the Merck iron hydroxide prescribed as a starting material in the publication. The Court finds that the defendants have justified their use of the substitute hydroxide by showing that:

(1) They attempted to obtain the Merck iron hydroxide as prescribed by Kraeber and Luyken, but none was available. (p. 73, Dx. 3-E).

(2) The substitute starting material (YLO-1788) was of the same extremely small particle size as Merck iron hydroxide. The evidence discloses that the particle size of the prescribed and the substitute hydroxides are the same. (p. 11, Dx. 3-E) (pp. 16, 17, Dx. 1-Z (2)) (p. 14, Dx. 3-E).

(3) The Merck and the YLO-1788 hydroxides both consisted of acicular particles. This is borne out by the evidence. (pp. 62 and 69, Dx. 3-E, and pp. 8, 16 and 17, Dx. 1-Z-2).

Except for the use of a substitute starting material, the procedures outlined in the Kraeber and Luyken article were followed in producing the P series demonstration oxides. The starting material (p. 11, Dx. 3-E) was roasted at a temperature of 400° C. for one-half hour in the presence of carbon monoxide gas (pp. 8, 9, Dx. 3-E). The kiln was then removed from the heating blanket with nitrogen continually passing through and was placed on the floor to cool down to room temperature (pp. 18, 19, Dx. 3-E). This procedure follows test No. 3, table 5, page 30 of the Kraeber and Luyken article (Dx. 1-Z (2), p. 8, Dx. 3-E). In the second step in the procedure materials produced in the first step were placed in a rotary kiln and heated to 200° C. This temperature was maintained for a period of one hour as air passed through the kiln. The kiln was then removed from the heating blanket and cooled down to room temperature (p. 27, Dx. 3-E). The second step of the procedure follows the procedure outlined in experiment 7, table 6, page 36 of the publication (Dx. 1-Z(2)).

The oxide and tapes produced correspond in all respects to the Camras patent material (pp. 2-5, Dx. 1-B-3) pp. 1-3, Dx. 1-B-4).

The United States Department of Interior Bureau of Mines Bulletin No. 425, dealing with the Magnetic Separation of Ores, at page 136, teaches the Effect of Heat Treatment on Iron Oxides, Ferrites and Ilmenite and provides as follows:

"Properties of Gamma Fe2O3 and Ferrites

    "It has long been known that under certain
  conditions Fe2O3 is ferromagnetic. This form
  has been shown by X-ray spectrometry to be cubic,
  whereas the ordinary para-magnetic form is hexagonal.
    "Of the various methods for preparing this
  ferromagnetic Fe2O3 two may be used to treat
  minerals for magnetic separation. By the first method
  Fe3O4, regardless of its method of formation,
  may be the starting point. Reactive varieties
  resulting from the gaseous reduction of ordinary
  Fe2O3 or from drying precipitated, hydrated
  Fe3O4 are readily converted by heating in air
  at 220° to 550° C. or by subjecting them to the
  action of oxidizing solutions to gamma Fe2O3.
  Heating at higher temperatures forms ordinary
  Fe2O3. Nonreactive Fe3O4, exemplified
  by most natural magnetities, may be converted to the
  reactive type by oxidation to the ordinary
  Fe2O3 followed by gaseous reduction.
    "By the second method gamma ferric oxide hydrate is
  heated at 250° to 300°C. (347) so as to produce the
  ferromagnetic gamma Fe2O3. The transformation
  temperature is not sharp, but overheating must be
  avoided to prevent further conversion to ordinary
    "Gamma ferric oxide hydrate may be formed by the
  oxidation of ferrous hydroxide or of mixtures of
  ferrous and ferric hydroxides (210); its preparation
  may be favored by the use of certain organic
  nitrogen-containing compounds (15)."

The teachings of the above article disclose to one skilled in the art that in order to obtain a high coercive force oxide, reduction temperatures of between 220 to 500°C. must be followed and that overheating will destroy these magnetic properties.

In the demonstration Camras (Camras' affidavit, pp. 62, 63, 64, Dx. G) conducted for the benefit of the Patent Examiner it is important to note that the temperatures prescribed above were not followed. Although the Bureau of Mines Bulletin No. 425 was used as a reference by the Examiner in determining the validity of the Camras application, only pages 88 to 95 were considered, notwithstanding the fact that at page 136 the effect of heat treatment on iron oxides is disclosed. Could it be that Camras "religiously avoided" conducting an experiment based on this page of the publication?

The Court finds that the Williams and Thewlis, the Kraeber and Luyken, and the Bureau of Mines publications anticipated the oxide claimed by Camras as his invention. The Camras file wrapper (Dx. G) discloses that these publications were not cited to nor considered by the Patent Office as prior art publications. The Patent Examiner did not have the benefit of these publications when he considered the validity of the Camras application.

The Court further finds that the Johnson British patent clearly teaches the use of magnetic iron oxides, both Fe3O4 and gamma Fe2O3, in a finely divided state and of a small particle size and of a high coercive force to be especially suited for use as a magnetic recording media. Although the examples of the method of preparing the oxide contained in the Johnson patent do not disclose the exact method of preparing the oxide claimed by Camras as his invention, yet by following the Johnson teachings and referring, as the patent teaches, to the magnetic oxide art as known and disclosed in prior publications, the Camras oxide is anticipated, as is the use of these oxides for magnetic recording members.

The Welo and Baudisch article published in August, 1934, (Dx. B) discloses a method whereby synthetic magnetite may be obtained by the reduction of gamma monohydrate and alpha monohydrate.

The starting material for the gamma ferric oxide of Welo and Baudisch is obtained by burning iron carbonyl in a plentiful supply of air, then reducing the material in sodium acetate or potassium nitrate at 320°C. for 10 minutes (p. 73, Dx. B). This article was followed at the Easton demonstrations. Reduction at 460°C. in acetate resulted in the production of oxides having Hc of over 200 oersteds, Bfm/Br of 3 to 1, rapid rise from 200 to 600. Reduction at 360°C. in potassium nitrate produced oxides having Bfm/Br of 3 to 1 and a coercive force of 200. (Dx. 1-B-1, pp. 34, 35, 36).

Electron micrographs taken of the demonstration oxides produced by following Welo and Baudisch show the presence of some particles with a length to width ratio of more than 2 to 1 (Dx. 1-R-5 and 1-R-6).

When viewing the particles under the definition of acicular, meaning 2 to 1 or more in length to width ratio, defendants' Exhibits 1-R-5 and 1-R-6 show the presence of acicular particles. However, the oxide produced by following Welo and Baudisch does not produce predominantly acicular particles as does the Williams IRN-210 oxides, claimed to infringe the patent.

Camras claims and places much stress on acicularity as one of the important criteria of his oxide. It should therefore be particularly noted and emphasized that he did not produce or offer in evidence a photomicrograph which would show to what extent the Camras oxide is more acicular than the oxides produced at the Easton demonstrations, if in fact such is true. Photomicrographs of the Welo and Baudisch oxides produced at the Easton demonstrations are in evidence (Dx. 1-R-5, 1-R-6). Photomicrographs of IRN-210 are also in evidence, having been offered by the plaintiff (Px. 26).

An article by J. Huggett of the University of British Columbia, published in 1929, discloses a method of precipitating Fe2O3 by reacting a solution of ferric nitrate with ammonia and then reducing the Fe2O3 in a mixture of hydrogen and water vapor. The reference teaches how to control the concentration of hydrogen and water vapor in relation to the temperature so as to obtain ferrosoferric oxide ...

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