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American Calcar, Inc v. American Honda Motor Co.

April 17, 2012

AMERICAN CALCAR, INC.,
PLAINTIFF,
v.
AMERICAN HONDA MOTOR CO., INC.; HONDA OF AMERICA MANUFACTURING, INC., DEFENDANTS.



The opinion of the court was delivered by: Hon. Dana M. Sabraw United States District Judge

AND RELATED COUNTERCLAIM.

FINDINGS OF FACT AND CONCLUSIONS OF LAW ON INEQUITABLE CONDUCT

On November 3, 2008, this Court issued findings of fact and conclusions of law on the issue of inequitable conduct, finding Plaintiff American Calcar, Inc. ("Calcar") committed inequitable conduct during the prosecution of United States Patent Numbers 6,330,497 ("the '497 Patent"), 6,438,465 ("the '465 Patent") and 6,542,795 ("the '795 Patent"). Calcar appealed that decision to the Federal Circuit, and while that appeal was pending, the Federal Circuit decided Therasense, Inc. v. Becton Dickinson and Co., 649 F.3d 1276 (Fed. Cir. 2011) (en banc), which modified the standards for inequitable conduct. In light of Therasense, the Federal Circuit vacated this Court's finding of inequitable conduct and remanded the case for further proceedings. See Am. Calcar, Inc. v. Am. Honda Motor Co., Inc., 651 F.3d 1318 (Fed. Cir. 2011).

After remand, the parties submitted an additional round of briefs and refined their arguments. Honda now limits its accusations of inequitable conduct to Michael Obradovich, the founder of Calcar, and the parties focus on the specific issues identified by the Federal Circuit, namely whether Mr. Obradovich knew that withheld information was material to his invention and whether he made a deliberate decision to withhold that information. The matter came on for hearing on March 16, 2012. Robert Maier, Jennifer Tempesta and Richard Clegg appeared on behalf of Calcar, and Robert Hillman, John Johnson, Michael Autuoro and Michael Rosen appeared on behalf of American Honda Motor Co., Inc. and Honda of America Manufacturing, Inc. ("Honda").

I.

FINDINGS OF FACT

1. Michael Obradovich is the founder of Calcar. (Trial Tr. at 251.)

2. In the 1990s, Calcar had an editorial department and an art department. John Dinkel supervised the editorial department, and Michael Kent assisted Mr. Dinkel. (Dep. of Michael Obradovich ("Obradovich Dep.") at 9, Nov. 14, 2007.)*fn1 Michael Lasting managed the art department, which usually consisted of five or six employees. Mr. Obradovich and his wife Karen also worked at Calcar.

3. During this time, Calcar developed and sold vehicle booklets that provided information specific to the vehicle and were included by some automobile manufacturers in the glove boxes of their vehicles. These booklets were called "Quick Tips." "Quick Tips" were four-by-six inch booklets that included "everything you want to know about your new car in ten seconds or less." (Trial Tr. at 251.) In essence, "Quick Tips" was a condensed version of the owner's manual.

4. Calcar employees would use the owner's manuals to create "Quick Tips." Indeed, Calcar's business model was based on copying the owner's manuals and condensing them into "Quick Tips" booklets. As Mr. Kent stated, employees in the editorial department "would cut out or copy the owner's manual, put the numbers on them, and then write all this stuff out and send it down to [the art department], and they'd do the art, and they'd send it back, and we'd check it." (Decl. of Robert Maier in Supp. of Opp'n Br. ("Maier Decl."), Ex. 5 at 17.)

5. Calcar employees also took photographs of the vehicles for use in making "Quick Tips." (Id. at 43; Obradovich Dep. at 326, Aug. 30, 2005.)

6. In 1996, Calcar created "Quick Tips" for the Acura RL. (Obradovich Dep. at 82-83, May 25, 2005.)

7. In May of 1996, Honda added the navigation system feature as an option for the Acura RL. (Trial Tr. at 600.) This was the first in-dash navigation system introduced in North America. (Id. at 608.) The system included a display screen that the user could control either by touch or by using a joystick. (Id. at 620.) Available options were presented to the user on the display screen, and the display changed according to the status of the option. Unselected options were presented in one color, selected options were highlighted in yellow, and activated options were highlighted in blue and indicated audibly with a "beep." (Id. at 620-23; 1066-67.) The system also included an input screen whereby the user could enter information that would cause the system to search for and display information related to the user input. (Id. at 627-29.)

8. During the summer of 1996, someone from Calcar took photographs of the dashboard of an Acura vehicle with a navigation system, including the display screen. (Decl. of Michael Rosen in Supp. of Opening Br. ("Rosen Decl."), Ex. L.) Each photograph captures a different display screen. In one of the photographs, the words "Find Calcar" appear in one of the boxes on the display screen. (Id.) Another photograph shows a list of options on the display screen, one of which is highlighted in yellow, along with information about that option in a separate box on the display. (Id.) The back sides of the photographs are stamped with Kodak insignias, including one that reflects Kodak's status as a sponsor of the Olympic games.*fn2

9. In August of 1996, Mr. Dinkel borrowed an Acura RL that was equipped with a navigation system. (Trial Tr. at 266-67.) Mr. Dinkel, Mr. Kent and Mr. Obradovich spent between "30 minutes to an hour" in that car, during which they operated the navigation system and drove the automobile.

(Id. at 266-68.) That experience led to the conception of the inventions at issue in this case. (Obradovich Dep. at 237, May 26, 2005.)

10. The following month, September 1996, Mr. Obradovich contacted a patent attorney, Alex Yip. (Obradovich Dep. at 285, Aug. 30, 2005.)

11. A few months later, on November 15, 1996, Mr. Dinkel wrote to Jack Yamuguchi regarding navigation systems. Mr. Yamaguchi had authored an article entitled, "Honda in-car navigation system for the U.S.," that was published in the June 1996 edition of Automotive Engineering magazine. (Rosen Decl., Ex. N.) In his letter to Mr. Yamaguchi, Mr. Dinkel stated:

Right now I'm in the process of gathering information on vehicle on-board navigation systems like the one in the Acura RL. Realizing that Japan is the home of such systems, I was wondering if you could direct me to any sources of information on the newest systems. Have you written any articles for the SAE on the subject? I have copies of all current and back issues of Automotive Engineering, but I can't remember any extensive articles.

(Id.)

12. Mr. Obradovich worked closely and exclusively with Mr. Yip on the patent application. (Obradovich Dep. at 351, Aug. 30, 2005.) Although Messrs. Dinkel and Kent are named as inventors on the patents at issue, neither was involved in preparing the patent application. (Id.; Decl. of Michael Rosen in Supp. of Reply Br. ("Rosen Reply Decl."), Ex. AB at 28-30; Rosen Reply Decl., Ex. AA at 57.)

13. Rather, Mr. Obradovich drafted the application and gave it to Mr. Yip. (Obradovich Dep. at 282, 285-86, Aug. 30, 2005; Obradovich Dep. at 26, February 13, 2008.)

14. Mr. Obradovich also participated in preparing the drawings that were part of the patent application. (Obradovich Dep. at 302-06, Aug. 30, 2005.)

15. The application includes two explicit references to the navigation system of the 1996 Acura RL ("the 96RL"). First, it states in the section ...


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