Enka B. V. v. E. I. Du Pont De Nemours & Co.
Enka B. V. v. E. I. Du Pont De Nemours & Co.
Opinion of the Court
OPINION
This opinion treats two closely allied actions under the Declaratory Judgment Act, 28 U.S.C. §§ 2201 and 2202, for determination of the validity and enforceability of United States patents. No answers have been filed, defendant having instead moved to dismiss on jurisdictional grounds. Plaintiffs are Dutch producers of industrial fibers potentially within the scope of claims of American patents owned by E. I. duPont de Nemours & Co. Although they manufacture and do most of their marketing in Europe, each company alleges some stake in the American market that it regards as threatened by duPont’s U.S. patents. Consequently, plaintiffs wish to challenge those patents. The issue before this Court is whether the stakes alleged and the threats perceived create a case or controversy that may vest jurisdiction in a federal district court. Finding that the requisite concrete interest has not been shown, the Court will dismiss the complaints for lack of subject matter jurisdiction.
I. PROCEDURAL POSTURE
DuPont has grounded its motions on both Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). The latter rule appears inapposite. A Rule 12(b)(6) motion goes to the merits of the substantive claims and may be converted into summary judgment under Federal Rule of Civil Procedure 56. A Rule 12(b)(1) motion, on the other hand, attacks subject matter jurisdiction and may require examination of factual issues wholly distinct from the case on the merits. Johnsrud v. Carter, 620 F.2d 29, 32-33 (3d Cir. 1980); Mortensen v. First Federal Savings & Loan Assoc., 549 F.2d 884, 891 (3d Cir. 1977). The motions presently before this Court fit the Rule 12(b)(1) category. DuPont’s arguments concern not the patent validity issues, but the question whether plaintiffs’ ties to the United States are sufficient to create an immediate apprehension of harm so as to warrant exercise of jurisdiction under the Declaratory Judgment Act. Therefore, today’s decisions will be based on Rule 12(b)(1).
Treatment of these motions under Rule 12(b)(1) raises evidentiary issues that should be resolved preliminarily. A motion to dismiss generally requires that the well-pleaded factual allegations of the complaint be regarded as true. Third Circuit precedent establishes, however, that when the motion creates a factual issue regarding subject matter jurisdiction, “no presumptive truthfulness attaches to plaintiff’s allegations, and the existence of disputed material facts will not preclude the trial court from evaluating for itself the merits of jurisdictional claims. Moreover, the plaintiff will have the burden of proof that jurisdiction does in fact exist.” Mortensen, supra, 549 F.2d at 891 (dictum) [footnote omitted]. See also Nelson v. Keefer, 451 F.2d 289, 296 (3d Cir. 1971); Groh v. Brooks, 421 F.2d 589, 594-95 (3d Cir. 1970). It is believed that this rule should govern the
A corollary of the procedure outlined above is the conclusion that the Court may view the evidentiary record as a whole, rather than restrict itself to scrutiny of the complaint. See Mortensen, supra, 549 F.2d at 891; Grafon Corp. v. Hausermann, 602 F.2d 781, 783 (7th Cir. 1979); Phoenix Canada Oil Co. v. Texaco, Inc., 78 F.R.D. 445, 452 (D.Del. 1978). One limitation attaches to this principle: because jurisdiction must be determined as of the date the complaints were filed, July 30,1980, the Court will not consider evidence of subsequent events alleged to create the concrete adversity needed for federal jurisdiction.
II. LEGAL PRINCIPLES
Under the Declaratory Judgment Act, this Court may declare the “rights and other legal relations” of parties to a “case of actual controversy within its jurisdiction.” 28 U.S.C. § 2201.
The Declaratory Judgment Act has a broad, remedial purpose and should be interpreted liberally. See, e. g., Aetna Life Insurance Co. v. Haworth, 300 U.S. 227, 57 S.Ct. 461, 81 L.Ed. 617 (1937); Treemond Co. v. Schering Corp., 122 F.2d 702, 703 (3d Cir. 1941). In patent litigation, a declarato
These admirable policies do not, however, constitute the courts as roving inquirers into patent validity. The Declaratory Judgment Act established a new procedure and a new remedy only for conflicts within the bounds of Article III of the United States Constitution. The rights claimed by a declaratory judgment plaintiff must be in existence and at risk before there is a case or controversy for judicial resolution. See Maryland Casualty Co. v. Pacific Coal & Oil Co., 312 U.S. 270, 61 S.Ct. 510, 85 L.Ed. 826 (1941); Aetna Life, supra, 300 U.S. at 239-41, 57 S.Ct. at 463-64.
The courts have developed a form of jurisdictional inquiry appropriate to declaratory judgment patent cases. First it must be determined that the case properly arises under federal laws so as to permit invocation of federal jurisdiction. This requirement is met if the adverse action that plaintiff seeks to prevent would arise under federal laws. See Thiokol Chemical Corp. v. Burlington Industries, 448 F.2d 1328 (3d Cir. 1971), cert. denied, 404 U.S. 1019, 92 S.Ct. 684, 30 L.Ed.2d 668 (1972). Second, live adversity between the two parties must be established by evidence that the defendant has acted so as to cause plaintiff “reasonable apprehension” of legal action if it continues to pursue its commercial course. See, e. g., Dewey & Almy Chemical Co. v. American Anode, Inc., 137 F.2d 68 (3d Cir.), cert. denied, 320 U.S. 761, 64 S.Ct. 70, 88 L.Ed. 454 (1943); Polaroid Corp. v. Berkey Photo, Inc., 425 F.Supp. 605 (D.Del. 1976); Japan Gas Lighter Assoc. v. Ronson Corp., 257 F.Supp. 219 (D.N.J. 1966). Third, plaintiff must show that its claim is concrete rather than academic by credible allegations of immediate intent and ability to undertake the business that must bring it into collision with defendant’s patent claims. See, e. g., Super Products Corp. v. D P Way Corp., 546 F.2d 748 (7th Cir. 1976); Aralac, Inc. v. Hat Corp. of America, 166 F.2d 286 (3d Cir. 1948); Atlas Imperial Diesel Engine Co. v. Lanova Corp., 79 F.Supp. 1002 (D.Del. 1948). In short, Congress’ liberal grant of jurisdiction to anticipate legal injury is confined within constitutional limits by judicial inquiry into imminent events that must grow out of existing situations. Examination of the instant motions will proceed according to these general guidelines.
III. AKZO PLASTICS
Akzo Plastics B.V. (“Akzo”) is a Dutch subsidiary of Akzo N.V., a holding company that encompasses a multi-national network of manufacturing companies. Akzo produces an industrial fiber, marketed under the tradename Arnitel, that is comparable to duPont’s patented Hytrel. Both are polyetherester elastomers used in manufacturing a variety of molded products such as soccer balls, cable and the soles of sports shoes. DuPont has refused to enter into licensing arrangements with Akzo, instead commencing a world-wide patent battle joined by Akzo in other countries and now in this Court.
A. Does the Case Arise Under the Patent Laws.
The first question is whether the case arises under the patent laws cognizable
Akzo challenges 14 duPont patents covering the substance Hytrel, processes for manufacturing it, and chemical “intermediates” used in production. Because its own product, Arnitel, and its means of production are arguably within certain of duPont’s patent claims, Akzo fears liability for patent infringement. DuPont might, plaintiff asserts, bring actions against Akzo either for direct infringement of the product patents on the basis of sales of Arnitel in this country or for knowingly contributing to infringement by supplying customers who will here use or sell products made from Arnitel. Without purporting to comment on the merits of such hypothetical suits by duPont, the Court finds it clear that the cases would arise under 35 U.S.C. § 271, which defines and prohibits patent infringement. Thus the requirements of 28 U.S.C. § 1338 are met with regard to the product patents in suit.
The next question is whether claims regarding duPont’s process and intermediate patents meet the test. Akzo currently produces Arnitel in Holland, and has no intention of manufacturing in the United States.
B. Is there a Case or Controversy?
Because the possibility of infringement suits regarding the U.S. product patents satisfies the requirements of 28 U.S.C. § 1338, the Court will proceed to determine whether the facts establish the additional case or controversy requirements necessary to a final conclusion that it possesses subject matter jurisdiction over those patents. Akzo must show that it has begun or will undertake commercial activity now jeopardized by a reasonable apprehension of infringement litigation based on duPont’s U.S. patents. It will be seen that Akzo has satisfied one element of the test, threat of infringement action by duPont. The evidence does not, however, establish the imminence of arguably infringing activity in the United States. Consequently, the second element of the test is not satisfied and jurisdiction does not exist.
1. The Customer Liability Theory
Plaintiff has offered a number of theories of imminent or current harm attributable to duPont’s aggressive assertion of its patent rights. First, Akzo fears that its customers will be subject to suit should they export Arnitel or products made with it to the United States. Second, Akzo foresees direct action against itself should it decide to manufacture or sell Arnitel in the U.S. Third, counsel offered at oral argument the theory that Akzo itself might be sued for inducing direct infringement by customers who ship infringing articles to this country.
Akzo relies primarily on the customer liability theory. Stated in terms of injury to plaintiff, the theory is that customers are being, or will be, deterred from dealing with Akzo by the prospect of liability for business done in the U.S. What follows reflects this Court’s record knowledge of current relations between duPont and Akzo regarding use of United States patents in the competition for customers.
Akzo maintains a plant in Arnhem, Holland, that has produced commercial quantities of Arnitel for at least two years.
Akzo’s approach to the indemnity problem has changed over the years. The first documented request for indemnity met with outright rejection on the ground that “Akzo Plastic b. v. are not offering Arnitel in the USA and they are not willing to be exposed to infringement litigation in that country.”
The prospect of liability through expanded legal action by duPont appears in memoranda and letters outlining the breakdown of attempts by Akzo and duPont to resolve their competitive positions by means short of world-wide litigation. In June, 1979, representatives of duPont and Akzo met in London to canvass the possibility of limiting the number of legal battles that need be fought. At this meeting, Akzo’s René Sieders stated the position that plaintiff has taken in this Court: Akzo’s real concern is to ensure that its European customers will feel secured against the threat of litigation should they export to the United States products incorporating Arnitel.
The factual case for a finding of justiciability may be summarized thus: Plaintiff is now offering its product to customers who are worried about infringement liability in the United States. Although those customers have not been directly threatened by duPont, they have, arguably, felt the force of duPont’s threatening posture. At the same time duPont became more adamant about its U.S. patent rights, Akzo reassessed its prior policy of refusing to indemnify Arnitel purchasers and has undertaken at least one negotiation that may result in an indemnification agreement although none has yet been consummated. The question for decision is whether this evidence of duPont’s patent enforcement stance and Akzo’s business interest represent a concrete clash of legal rights arising from U.S. product patents.
a. DuPont’s Threats of Infringement Action
To find a genuine controversy, the Court must have evidence that defendant has asserted its patent rights by words or conduct that cause plaintiff reasonably to fear adverse action based on those patents. See, e. g., Dewey & Almy Chemical Co. v. American Anode, Inc., 137 F.2d 68, 70 (3d Cir.), cert. denied, 320 U.S. 761, 64 S.Ct. 70, 88 L.Ed. 454 (1943); Japan Gas Lighter Assoc. v. Ronson Corp., 257 F.Supp. 219, 237—43 (D.N.J. 1966). In advancing the the ory presently under discussion, Akzo claims that it labors under a threat of infringement litigation against customers who export to the United States articles containing Arnitel. The issue, then, is whether duPont has created a reasonable fear of such litigation. The Court finds that it has.
This conclusion is dictated by the liberality of interpretation consistently observed in this Circuit. In a seminal case, jurisdiction was found where the only form of threat to plaintiff consisted of the patentee’s suit of a different competitor for use of a different infringing process and a conversation in which defendant’s agent informed plaintiff that it intended to “put a stop to” infringement. Dewey & Almy, supra, 137 F.2d at 69-70. Relying principally on the institution of the lawsuit, the court found that defendant had publicly asserted its patent rights, thereby creating a justiciable controversy. It was of no moment that there had been no direct threat to Dewey & Almy or that defendant denied knowledge of Dewey & Almy’s intent to use an infringing process. The counterpart lawsuit made the patent an “economic weapon” against plaintiff because “customers and prospective customers may also be scared off by suits against other alleged infringers.” Id. at 71.
Numerous cases restate the proposition that a justiciable controversy exists where the threat of infringement action is indirect and unspecific. See, e. g., Simmonds Aerocessories, Ltd. v. Elastic Stop Nut Corp. of America, 257 F.2d 485, 490 (3d Cir. 1958); Federal Telephone & Radio Corp. v. Associated Telephone & Telegraph Co., 169 F.2d 1012 (3d Cir.), cert. denied, 335 U.S. 859, 69 S.Ct. 133, 93 L.Ed. 406 (1948); Ethicon, Inc. v. American Cyanamid Co., 369 F.Supp. 934, 937 (D.N.J. 1973); Japan Gas Lighter Assoc. v. Ronson Corp., 257 F.Supp. 219, 238 (D.N.J. 1966). Ethicon is particularly pertinent here. In that case, a justiciable controversy existed on the basis of defendant’s suit in Great Britain against plaintiff’s sister corporation for infringement of a British patent corresponding to a U.S. patent. “The suit in Britain constitutes ample notice both to plaintiff and to those with whom plaintiff does business, of an existing controversy.” Ethicon, supra, 369 F.Supp. at 937.
The record in this case brings it within the line of precedent discussed above. As in Ethicon, foreign litigation has given notice that duPont considers Arnitel an infringing product sufficiently dangerous to warrant legal action. The instant case presents an even stronger claim to justiciability than Dewey & Almy. There, the other lawsuit concerned a process different from the one plaintiff planned to use, while in this case, customers are on notice that the very product they purchase is under attack. It is concluded that duPont created a threat that fulfills the first element of the justiciability test under a customer liability theory.
b. Probability that Arnitel Customers Will Enter the American Market
The inquiry does not end with this finding, however. This Court has unequiv
Polaroid clearly denies justiciability in these circumstances. That case is consonant with earlier holdings that the mere wish to enter a particular market does not constitute a concrete legal interest deserving of vindication by declaratory judgment.
As plaintiff points out, the courts often use broad language to describe the harm done by threatening customers. Such far-reaching dictum cannot support the conclusion that threats alone create a justiciable controversy, for the courts’ language is generally qualified by some reference to the presence of actual or imminent infringement by the plaintiff or his customers. In Dewey & Almy, for example, the court expressed lively anxiety that customers might vanish in the face of infringement litigation. Dewey & Almy, supra, 137 F.2d at 71. Nevertheless, it also stated: “It is obvious that a person not now engaged in possible infringing conduct, and having no immediate intention of doing so, but having an academic interest in the law of patents, could not obtain a declaratory judgment.” Id. at 70. Similarly, in Ethicon, the plaintiff whose sister corporation had been sued in England was held to have shown “compelling circumstances” favoring justiciability since it had already manufactured the infringing articles in the United States. Ethicon, supra, 369 F.Supp. at 939.
In sum, the failure to allege or proffer facts indicative of the imminence of in
2. Alternative Theories of Justiciability
Akzo’s other theories of justiciability fare equally badly and may be disposed of much more briefly. This Court is in no position to rule on counsel’s suggestion that jurisdiction may rest on Akzo’s possible liability for inducing infringement by customers who sell Arnitel based products in the United States.
Finally, Akzo claims that actual controversy beclouds its own right to sell Arnitel directly to American buyers. The complaint alleges that Akzo will pursue its business “in an even more intensive manner in the United States.”
The short answer to all proffered theories of justiciability lies in the flimsiness of the evidence that Arnitel will shortly become a competitor in the American market. The evidentiary weakness cannot diminish the fact that U.S. patents exert considerable economic effect on the European competi
The complaint in Civil Action No. 80-359 will be dismissed.
IV. ENKA
Enka B.V. of Arnhem, Holland (“Enka”), stands in much the same relation to defendant duPont as does Akzo. Enka is a Dutch subsidiary of the European chemical concern that also encompasses Akzo. Enka manufactures “Arenka,” an industrial aramid fiber used in such products as automotive tires. The complaint alleges sufficient similarity between Arenka and duPont’s patented “Kevlar” to create a possible problem of infringement.
The Enka case differs from Akzo’s in the extent of plaintiff's current development: The European operation is considerably smaller than Akzo’s, but it’s American contacts are more extensive. Enka’s current production is relatively slight, being limited to the output of a Dutch pilot plant not now operating at full capacity. Plaintiff is attempting to obtain funds for commercial-scale plants. However, it is undisputed that these plans depend on the Dutch government’s willingness to participate in the venture to the extent of more than $50,000,000.
Despite its small size, Enka has made overtures to potential American customers.
The inquiry into justiciability of Enka’s suit will follow the pattern set above.
A. Does the Case Arise Under the Patent Laws?
Enka seeks a judgment declaring the invalidity and unenforceability of a
B. Is There a Case or Controversy?
1. Threats of Infringement Action
The submissions of both parties establish that Enka passes one phase of the test for subject matter jurisdiction: Enka had a reasonable apprehension of a duPont lawsuit based on the U.S. patents at issue. In his affidavit Donald A. Hoes, a duPont patent attorney, avows that “[defendant has told Enka of its intention to protect its patent rights relating to aramid fibers in those countries where it has such patents when and if Enka becomes commercial in such country.” The affiant further acknowledges that duPont has sued Enka in several European countries on the basis of counterparts of the U.S. patents.
This history of threatened litigation on U.S. patents, backed up by the contemporaneous example of suits on foreign counterpart patents, amply justifies Enka’s claim that it has a reasonable apprehension of infringement litigation. Indeed, comparable cases indicate that a less fully-documented showing would be adequate. See, e. g., Treemond Co. v. Schering Corp., 122 F.2d 702 (3d Cir. 1941) (advertisement in trade magazine stating that declaratory judgment defendant intended to protect its patent rights was sufficient threat to support jurisdiction); Ethicon, Inc. v. American Cyanamid Co., 369 F.Supp. 934 (D.N.J. 1973) (suit on foreign counterpart patent sufficient threat).
Defendant argues that the threat it acknowledges is merely to sue “when and if Enka becomes commercial” in the U.S.
2. Enka’s Intent and Capacity to Enter the American Market
Enka’s case falters at the issue of its intent and capacity to undertake infringing sales in the United States. Enka first argues that its present level of activity— based on the pilot plant’s production — is sufficient to show existing controversy in the United States as well as the intent and capacity to increase American sales. It then points to the plans for future commercialization to support the need for immediate relief.
Enka’s current position will be examined first. This opinion has already touched on some of the relevant facts. To recapitulate, plaintiff operates a small pilot plant in Holland. It has distributed Arenka samples to a number of U.S. companies and made at least one sale.
In order to hold that Enka faces actual controversy with duPont, this Court must find that plaintiff has serious and immediate plans to undertake the infringing activity — sale in the United States.
Under this standard, plaintiff’s arguments must fail. The shipments over five years total only 640 pounds. These are mere tokens, not indicative of a genuine market presence in this country.
Plaintiff points out that some courts have found justiciable controversy where commercial-scale infringement had not yet occurred. Those cases are distinguishable from the present circumstances, however, in the extent to which those plaintiffs had prepared to enter the American market. In Simmonds Aerocessories, Ltd. v. Elastic Stop Nut Corp. of America, 257 F.2d 485 (3d Cir. 1958), not only had the British plaintiff previously exported “substantial quantities” of the disputed device, but, just prior to the lawsuit, 143 drums of the product were withdrawn from the United States after being seized at Customs. The volume of Simmonds’ exports showed that it was a far more serious competitor in the American market than is Enka. Other cases in which pre-commercial activities were held to create actual controversy all involve plaintiffs who had built prototypes and commenced testing and sales promotions in the United States. See Super Products, supra; Sherwood Medical Industries, Inc. v. Deknatel, Inc., 512 F.2d 724 (8th Cir. 1975); Ethicon, Inc. v. American Cyanamid Co., 369 F.Supp. 934 (D.N.J. 1973). In each of these cases, there was no doubt that production was ultimately intended for a U.S. market. Enka, by contrast, has conducted its pilot project in Europe with only the most tentative incursions into the United States and no clear plans for a more substantial invasion. These cases do not stand in the way of holding that no actual controversy appears from the facts alleged here.
The final issue is whether Enka’s plans to build commercial-scale Arenka plants can fulfill the case or controversy requirement. Having found that Enka’s current position fails to support subject matter jurisdiction, the Court must conclude that future prospects also fail. The plan for a joint venture in commercialization calls for very substantial participation by the Dutch development agency, NOM. According to a member of plaintiff’s board of directors, NOM’s participation is a condition precedent to commencement of the plan. The agency has yet to decide whether it will undertake the investment.
The Court concludes that plaintiff’s current level of American business and its hopes for the immediate future do not meet the jurisdictional requirement of the Declaratory Judgment Act. Further, it appears that this is an appropriate case for exercise of the district judge’s discretion to decline declaratory judgment jurisdiction. See Public Affairs Assoc. v. Rickover, 369 U. S. 111, 82 S.Ct. 580, 7 L.Ed.2d 604 (1962); Stamicarbon, N.V. v. Chemical Construction Co., 355 F.Supp. 228 (D.Del. 1973). Where the evidence of plaintiff’s plans for serious business in the United States is so equivocal, there is no assurance that judgment will effect a tangible change in the parties’ affairs rather than merely serve as an advisory opinion to be filed for future reference. To avoid the latter, prohibited result, the Court invokes its discretion. See Dr. Beck & Co. v. General Electric Co., 317 F.2d 538, 539 (2d Cir. 1963).
V. CONCLUSION
The two cases before this Court test the limits of justiciability in the declaratory judgment context. Examination of the facts has led to the conclusion that controversy over duPont’s U.S. patents has not yet crystallized. Plaintiffs have not shown the genuine stake in the American market that would vest in them the right to compete free of constraint by invalid patents. Absent a concrete legal interest in the result, plaintiffs cannot state an actual controversy of which this Court may take cognizance. Accordingly, an order will be entered dismissing the complaints without prejudice.
. Mortensen itself departed from the standard just quoted. The appellate court reversed a trial judge’s jurisdictional dismissal that had been granted on the basis of the analysis that will be used here. The Third Circuit Court of Appeals found this analysis appropriate in the usual factual challenge to jurisdiction, but not in Mortensen because plaintiff had had no clear opportunity to be heard on the jurisdictional facts and because those facts were also crucial to its case on the merits. 549 F.2d at 892, n.18. Since these two distinguishing factors are not present here, the usual rule identified in Mortensen should apply.
. In this respect, too, this case differs from Mortensen. There the court stated that filing of an answer should precede jurisdictional fact-finding because it is necessary that plaintiffs allegations be controverted. Mortensen, supra, 549 F.2d at 892, n.17. Here no answer has been filed, but plaintiffs’ jurisdictional claims are controverted in defendant’s motions and the issues have been joined by submissions from both parties. It is well established that if the plaintiffs “allegations of jurisdictional facts are challenged by his adversary in any appropriate manner, he must support them by competent proof.” McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 189, 56 S.Ct. 780, 785, 80 L.Ed. 1135 (1936) [emphasis supplied].
. At oral argument both counsel agreed “that the Complaint must be tested for justiciable controversy as of the time it was filed, but that later written documents can be used to evidence the plaintiffs intent at the time of filing.” Transcript at 43. The date of the original complaint is adopted because the amendments, filed October 24, 1980, in no way concern any issues briefed on these motions and discussed by the Court.
. The provision reads in full:
In a case of actual controversy within its jurisdiction, except with respect to Federal taxes other than actions brought under section 7428 of the Internal Revenue Code of 1954 or a proceeding under section 505 or 1146 of title 11, any court of the United States, upon the filing of an appropriate pleading, may declare the rights and other legal relations of any interested party seeking such declaration, whether or not further relief is or could be sought. Any such declaration shall have the force and effect of a final judgment or decree and shall be reviewable as such.
28 U.S.C. § 2201.
. See Affidavit of James T. Corle in Support of Defendant’s Motion to Dismiss Plaintiffs Complaint at 2. (Doc. No. 16).
. (a) The district courts shall have original jurisdiction of any civil action arising under any Act of Congress relating to patents, plant variety protection, copyrights and trade-marks. Such jurisdiction shall be exclusive of the courts of the states in patent, plant variety protection and copyright cases.
(b) The district courts shall have original jurisdiction of any civil action asserting a claim of unfair competition when joined with a substantial and related claim under the copyright, patent, plant variety protection or trade-mark laws.
28 U.S.C. § 1338.
. See Stohr deposition at 87-89.
. Akzo also has argued that jurisdiction may be predicated on 19 U.S.C. § 1337 and 1337a, provisions of the customs law that could permit duPont to seek exclusion of imports made abroad by processes patented in the United States. This statute, however, confers jurisdiction not upon a federal district court, but upon the United States International Trade Commission, empowering it to investigate and prevent importation of articles made by an infringing process which significantly damages United States industry. It is true that section 1337a explicitly confers the status of “unfair competition” on certain importations of products made by U.S. patented methods. That statute does not extend the reach of the patent laws generally. It defines unfair competition only “for the
. Stohr deposition at 89. The exact extent of Arnitel production appears in the sealed portion of Dr. Stohr’s deposition at 7-8.
. Sealed Appendix to Plaintiffs Brief in Opposition to Defendant’s Motion to Dismiss (Doc. No. 26A) at A37 & A41-43 [hereinafter “Akzo Appendix”].
. Akzo Appendix at A44.
. Akzo Appendix at A40.
. Akzo Appendix at A41-43.
. No finalized agreement appears in the Appendix. At oral argument, counsel for Akzo stated that he knew of no existing agreement. Transcript at 52.
. Akzo Appendix at A32 (minutes of June 15, 1979 meeting).
. Id. at A35.
. On February 12, 1980, duPont’s James T. Corle wrote to Akzo’s René Sieders:
In my letter of September 7, 1979, I mentioned that we were having difficulty formulating terms for settling our various patent conflicts. The situation was complicated by parties other than Akzo joining in the same opposition. It has now become more complicated by your company’s filing additional oppositions and the introduction of a complete line of products in apparent disregard of Du Pont’s patent rights in a number of countries. Du Pont has spent millions of dollars on research and market development in this field, and has obtained a number of patents protecting this development. We do not plan to grant licenses under these patents at this time.
Akzo Appendix at A25.
. Affidavit of W. H. Meyberg, General Manager of Akzo. Akzo Appendix at A27.
. Id. Meyberg’s statement that the threat was made goes unchallenged. DuPont’s only response to the claim was a post-argument affidavit averring that it has not been duPont’s practice to sue customers of infringers. Affidavit of Robert C. Kline. (Doc.No.31). This description of a general policy does not undercut the sworn statement that, on one occasion, there was a threat to break with that policy.
Kline’s affidavit dated December 16, 1980, was filed in response to the Court’s questioning at oral argument. It is considered only to the extent that it purports to describe duPont’s intentions at the time the complaint was filed. This decision is consistent with the ruling that jurisdiction must be determined as of the filing date. See supra at 3.
. Stohr deposition at 90.
. Complaint at ¶ 8 [emphasis supplied].
. Akzo Appendix at A37-41.
. Cases upholding jurisdiction where customer sales were threatened are not to the contrary. In each such case, plaintiff or his customers had either undertaken the infringing activity or alleged definite preparations to do so. See, e. g., Graf on Corp. v. Hausermann, 602 F.2d 781 (7th Cir. 1979) (plaintiff had manufactured infringing machines for several years); Alfred Hofmann, Inc. v. Knitting Machines Corp., 123 F.2d 458 (3d Cir. 1941) (infringing machines were in use by plaintiffs customer); Girdler Corp. v. E. I. duPont de Nemours & Co., 56 F.Supp. 871 (D.Del. 1944) (plaintiff already made and sold to U.S. customers machines whose use allegedly infringed defendant’s process patent).
. Similar circumstances appear in other patent cases urging liberal recourse to the Declaratory Judgment Act. See Super Products Corp. v. D P Way Corp., 546 F.2d 748 (7th Cir. 1976); Sherwood Medical Indus, v. Deknatel, Inc., 512 F.2d 724 (8th Cir. 1975); Treemond Co. v. Schering Corp., 122 F.2d 702 (3d Cir. 1941); Japan Gas Lighter Assoc. v. Ronson Corp., 257 F.Supp. 219 (D.N.J. 1966).
. See Transcript at 51-55.
. Complaint at ¶ 31.
. Akzo Appendix at A45, A54-58.
. Id. at A45 & A59. In addition to the indication that Arnitel samples have been used by at least one American manufacturer, the correspondence at A46-51 suggests that Akzo and that manufacturer are in the process of negotiating an agreement for direct American marketing by Akzo. Since the evidence contains no hint at the outcome of these negotiations, it does not show the imminence of arguably infringing sales in this country.
. See Sweetheart Plastics, Inc. v. Illinois Tool Works, Inc., 439 F.2d 871 (1st Cir. 1971); Wembley, Inc. v. Superba Cravats, Inc., 315 F.2d 87 (2d Cir. 1963). But see Super Products Corp. v. D P Way Corp., 546 F.2d 748 (7th Cir. 1976).
. Akzo Appendix at A32.
. Stohr deposition at 89.
. See discussion supra at 2.
. Consider, for example, a duPont internal memorandum on Hytrel’s foreign competitors. Akzo Appendix at A173.
. Complaint at ¶21. Confidential documents produced during discovery and submitted under seal by Enka convince the Court that duPont agrees with the plaintiffs allegation that Arenka may be covered by the duPont patents. See sealed Appendix to Opposition to Defendant’s Motion to Dismiss Plaintiffs Complaint at A43 & A50. (Doc.No.26A) [hereinafter “Enka Appendix”].
. Complaint at ¶¶ 9 & 10.
. See Stohr deposition at 34-37; Affidavit of Donald A. Hoes in Support of Defendant’s Motion to Dismiss Plaintiffs Complaint at 3. (Doc.No.18).
. See Stohr deposition at 27.
. See Enka Appendix at A25.
. See Stohr deposition at 24-27; Exhibit I attached to sealed Stipulation of December 16, 1980. (Doc.No.31).
. Complaint at ¶¶ 21-23.
. See supra at 3-5.
. Complaint at ¶ 14 (specifying Patent No. 3,767,756, entitled Dry-Jet Wet Spinning Process).
. See supra at 6-8.
. Affidavit at 2.
. Enka Appendix at A27. Many of the documents speak of Akzo rather than Enka as the maker of Arenka. The reference comes from the fact that Akzo N.V. (not Akzo, B.V., plaintiff in the allied action) is the parent of Enka B.V.
. Enka Appendix at A50.
. Hoes Affidavit at 2.
. Documents recording the 1977 discussion between duPont and Akzo/Enka representatives and a 1979 talk given by a duPont spokesman before the Dutch body currently considering a joint venture in Arenka make clear that
. Stohr deposition at 26-27; Exhibit I to sealed Stipulation of December 16, 1980.
. Complaint at ¶ 23.
. Stohr deposition at 72-76. Working out of the North Carolina headquarters of another subsidiary of Enka’s parent company, Akzo, N.V., this representative has some contacts with U.S. purchasers. Evidently he does not make actual sales; these are handled by a European Product Group.
. This analysis differs from that in Akzo’s case because different theories of justiciability were advanced. Akzo relied primarily upon the potential for U.S. sales by its European customers, while Enka asserts its own American dealings as a jurisdictional basis.
. To appreciate the slightness of Enka’s American sales, compare the 640 pounds of Arenka with the production capacity of duPont’s Kevlar plant, 15,000,000 pounds per year. (Hoes Affidavit at 2). Although the record does not permit precise comparison of the parties’ U.S. sales, the figure cited supports the inference that 640 pounds over five years is a minuscule contribution to the American aramid fiber industry.
. Stohr deposition at 27-30; sealed portion of Stohr deposition at 6.
. Stohr deposition at 25-26. After the filing of this complaint, an American concern made inquiries about the possibility of purchasing quantities of Arenka in the 100-500,000 lbs./yr. range. See Exhibits G & H to Stipulation of December 16, 1980; sealed portion of Stohr deposition at 10-12. Enka has submitted no evidence of the outcome of this inquiry.
. Stohr deposition at 38.
. Stohr deposition at 34-37; sealed portion of Stohr deposition at 8-10.
. Stohr deposition at 45; sealed portion,of Stohr deposition at 10.
Reference
- Full Case Name
- ENKA B. V. OF ARNHEM, HOLLAND v. E. I. DU PONT DE NEMOURS & CO., Defendant AKZO PLASTICS B. V. OF ARNHEM, HOLLAND v. E. I. DU PONT DE NEMOURS & CO.
- Cited By
- 11 cases
- Status
- Published