Lisle Corporation v. A.J. Manufacturing Compan

398 F.3d 1306 (2005)

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Nature of the Case

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Facts

Most automobiles are equipped with a rack and pinion steering control system. Due to the location of the tie rods and the variety of nut shapes holding the tie rods in place, removal of that component can be tedious with prior art tools. P's invention alleviates the need for automobile mechanics to completely dismantle steering control systems and keep multiple prior art tie rod tools for various inner tie rod designs. P and D are manufacturers and competitors in the field of automotive tools. Lisle owns the '776 patent. P filed suit accusing D of infringing the patent by manufacturing and selling its YA3000A tool. D denied infringing and asserted that the patent was invalid. The undisputed facts are that on or about December 12, 1989, P delivered the prototype tool to four different automobile repair shops in Omaha, Nebraska. P did not receive any payment for those tools. P did not require any of the mechanics to enter into a formal confidentiality agreement. On June 26, 1992, over thirty months after the first prototype tool was delivered, P filed the application leading to the '776 patent. D claims that P failed to demonstrate the requisite level of control over the work of the mechanics with the prototype tool to support an experimental use defense. D cites the lack of a formal confidentiality agreement, the lack of restrictions placed on the use of the prototype tool by the mechanics, and the absence of any documentary evidence regarding the actual testing of the prototype tool. Eventually, a jury trial was held on the single issue of whether the '776 patent was invalid on the ground of public use under §102(b). Williams, the coinventor, testified that he needed to know how well the wrench disc would fit on the inner tie rod socket and whether the prototype tool would fit in the confined location of the tie rod in different automobile models. Williams contacted the mechanics who were given the prototype tool every two to four weeks by telephone or in-person to receive testing feedback. Williams modified the design of the retainer in the prototype tool and added additional wrench disc sizes based on the comments he received from the outside mechanics. Williams also believed that the mechanics knew that the prototype tool was given to them for experimental purposes. 'General Meeting Reports' were drafted by the president of D which gave updates on the then-current status of the tie rod tool project, plans for future testing, concerns regarding the commercial viability of the tools, and suggestions from outside mechanics regarding how to improve the design of the tool. The jury found the '776 patent was not shown to be invalid on the ground of public use. The district court denied D's motion for JMOL of invalidity of the '776 patent after the jury rendered its verdict. D appealed.