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Sloan Valve Company v. Zurn Industries

March 8, 2011

SLOAN VALVE COMPANY
v.
ZURN INDUSTRIES



Name of Assigned Judge Sitting Judge if Other or Magistrate Judge Amy J. St. Eve than Assigned Judge

CASE TITLE

DOCKET ENTRY TEXT

Plaintiff's motion to reopen case for the limited purpose of amending the protective order to expressly allow submission of information required by the Patent Office and to rule on Defendants' objections to the submission of information [158] is granted. The stay remains in place in this case given the reexamination.

O[ For further details see text below.] Notices mailed by Judicial staff.

STATEMENT

On December 16, 2010, the Court stayed this patent-infringement case pending the outcome of the PTO's reexamination of U.S. Patent No. 7,607,635 ("the '635 patent"). (R. 157.) On February 22, 2011, Plaintiff, Sloan Valve Company, filed a motion to reopen the case for the limited purpose of amending the Protective Order to allow submission of information required by the PTO. (R. 158.) Sloan contends that federal regulations require it to disclose in the reexamination proceedings all information that may be material to the patentability of the '635 patent. (R. 159 at 2.) Sloan also observes that the Protective Order in this case does not "expressly permit submission of Confidential information to the Patent Office." (Id. at 3.) Plaintiff thus submits that it faces conflicting obligations. (Id.) Observing that the PTO's Manual of Patent Examining Procedure (MPEP) provides that "[i]t matters not whether the 'material' information . . . is subject to a protective order" (MPEP § 724), Sloan requests that the Court reopen the case, amend the Protective Order to allow Plaintiff to submit information designated as "confidential" or "highly confidential," and rule that Plaintiff's attorneys who have a duty to disclose material information to the PTO have the right to determine which information is material. (R. 159 at 3.)

Courtroom Deputy KF

Defendants (collectively "Zurn") oppose Sloan's motion. (R. 165.) They argue that Plaintiff's sought-after ruling would nullify the protective order. Relying on Telecomm. Sys., Inc. v. Mobile 365, Inc., No. 3:06-CV-485, 2009 WL 5943235 (E.D. Va. Mar. 31, 2009), Zurn contends that "submission of another's confidential materials is improper and sanctionable." (R. 165 at 4.) Zurn further argues that documents submitted under MPEP § 724 "will inevitably become available to the public if a reexamination certificate is issued." (Id. at 5 (citing MPEP § 724.04(c)). Zurn specifically objects to Plaintiff's introducing confidential documents that contain information favorable to patentability, for the MPEP makes clear that the PTO will not treat that information as confidential. (Id. at 5-6.) Finally, Zurn points out that "the vast majority of documents that Sloan has thus far identified as material are manifestly not prior art 'patents or printed publications'" and, so, "even if an agreement were to be reached as to their confidentiality designations, these references . . . would not be considered by the Examiner in the context of a reexamination." (Id. at 6.).

For the reasons discussed below, the Court grants Sloan's motion.

DISCUSSION

The first issue is whether federal regulations indeed require Sloan to disclose all material information to the PTO. 37 C.F.R. § 1.555 provides that "[t]he individuals who have a duty to disclose to the Office all information known to them to be material to patentability in a reexamination proceeding are the patent owner, each attorney or agent who represents the patent owner, and every other individual who is substantively involved on behalf of the patent owner in a reexamination proceeding." Sloan is the relevant patentee (R. 1 at 5-6), and thus 37 C.F.R. § 1.555 clearly imposes a duty on it and its attorneys to disclose all material information to the PTO during reexamination of the '635 patent.

Second, it is true that MPEP § 724 purports to impose a conflicting duty on Sloan, by providing that "[i]t matters not whether the 'material' information . . . is subject to a protective order."

The Court agrees that the Protective Order does not explicitly authorize Sloan to submit to the PTO confidential documents produced by Zurn. "[T]he Court does not intend to preclude another Court from requiring the disclosure of documents . . . in another case or proceeding." (R. 32 at 9) (emphasis added).

The PTO has a specific procedure for submitting confidential documents, and the Court sees no reason for the Protective Order to preclude the submission. See, e.g., Spine Solutions, Inc. v. Medtronic Sofamor Danek, Inc., No. 07-CV-2175, 2009 WL 5205381, at *3 (W.D. Tenn. Dec. 23, 2009) (rejecting the argument that "unsealing the orders is necessary to facilitate. . . reexamination . . . by the PTO" and observing that "Section 724 of the [MPEP] deals with submitting materials subject to a protective order. Section 724.02 describes in detail how to label confidential materials 'Subject to Protective Order' upon submission to the examiner so that they will not be disclosed to the public," and finally noting that "confidential information found not to be material to patentability may be expunged under MPEP 724.05 and 37 C.F.R. § 1.59"). In light of MPEP § 724's provision that a protective order does not alleviate a person of the duty to disclose material information, and because of the PTO's confidentiality procedures contained in that same section, the Court amends the Protective Order in the manner that Sloan suggests, with the exception that the ...


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