Hamilton Beach Brands, Inc. v. Sunbeam Products, Inc.


Docket No. 2012-1581

O’MALLEY, BRYSON, REYNA(d)
August 14, 2013

Brief Summary: Communication from supplier that it “was ready to fulfill” order “upon Hamilton Beach’s ‘release’” determined to be a commercial offer for sale because it could have been “made into a binding contract by simple acceptance” which is “enough under Pfaff’s first prong”.

Summary: Hamilton appealed from USDC ED VA grant of SJ to Sunbeam that claims 1 and 3-7 of Hamilton’s US 7,947,928 related to “slow cooker” pots are invalid for anticipation (on-sale bar) and no literal infringement. Parent US 7,845,831 claimed a device with clips for the lid on the cooker body. After issuance of the ‘831 patent, Sunbeam developed a product with clips on the lid. Hamilton obtained claims in the ‘928 patent with clips on the lid (the opinion noting that this was “[a]s could be predicted”). For anticipation, the critical / priority date is March 1, 2005. The opinion explained that Hamilton Beach issued a purchase order for almost 2000 cookers to its non-U.S. supplier listing its Tennessee office as the shipping address and its Virginia office as the billing address, and the supplier confirmed receipt by email and stated that it “was ready to fulfill” the order “upon Hamilton Beach’s ‘release’”. As this exchange occurred before the critical date, this scenario presents “an offer to buy” which is invalidating under “§ 102(b) as long as the offer is accepted and a binding contract to sell is formed” (Pfaff US 1998) (on-sale bar where claimed invention is subject of commercial offer for sale and invention is “ready for patenting”); Linear Tech., FC 2001 (no anticipation because LTC did not communicate acceptance of distributor’s offer to buy) or where “the other party could make into a binding contract by simple acceptance” (Grp. One Ltd. (FC 2003)). Hamilton argued that “the supplier made an offer to sell” the cookers to it but that it did not make an offer to sell the cookers to the supplier. Hamilton also admitted that “had it provided a ‘release’ any time after received that email, a binding contract would have been formed”. The FC panel determined that this was “a commercial offer for sale that Hamilton Beach could have made into a binding contract by simple acceptance” which “is enough under Pfaff’s first prong without the need for a binding contract”. Hamilton also unsuccessfully argued that the DC erred by failing “to conduct an element-by-element analysis of the precise subject that was the subject of the purchase order”. It argued that its engineers were unable to produce the “sealing engagement” limitation “until ‘months’ after the critical date.” However, it was determined that customers had been provided descriptions and CAD drawings of the cooker and that, therefore, the “ready for patenting” Pfaff prong was also satisfied (“more than enough to enable a person of ordinary skill in the art to practice the claimed invention”). Accordingly, the DC findings were affirmed. The dissent argued that this analysis was incorrect because there of the experimental-use exception (decision would render exception “useless…for a significant class of innovators”).

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