June 7, 2006
Federal Circuit Affirms Jury Verdict of Willful Patent Infringement And Judgment Awarding Treble Damages and Attorneys' Fees

On June 1, 2006, the United States Court of Appeals for the Federal Circuit affirmed a judgment of the United States District Court for the Northern District of Illinois in favor of FETF’s client, Liquid Dynamics, in its patent infringement lawsuit against Vaughan Company, Inc. The judgment included a finding of willful patent infringement, and compensatory damages awarded by a jury, as well as enhanced damages, attorneys' fees, and a permanent injunction entered by the District Court. The decision also rejected Vaughan’s defenses alleging prior art invalidity, non-enablement, best mode violations, and inequitable conduct. The Federal Circuit’s precedential opinion affirmed the District Court judgment in favor of Liquid Dynamics in all respects.

Liquid Dynamics’ "'414 patent" is directed to storing and mixing system technology commonly employed in wastewater treatment facilities. The technology of the '414 patent has achieved industry award winning status and significant commercial success. Vaughan originally supplied pumps incorporated into Liquid Dynamics’ patented JetMix system. The jury, the District Court, and the Federal Circuit were persuaded by evidence that Vaughan later copied Liquid Dynamics’ patented design in Vaughan’s competitive "RotaMix" system, which Vaughan introduced to the market after Liquid Dynamics’ early commercial successes. The jury and the Federal Circuit found that Vaughan had infringed Liquid Dynamics’ patent in connection with the sale of 47 RotaMix systems installed as of April 2002, including 11 systems in Canada and the United Kingdom.

The June 1, 2006, decision was the second victory for FETF and Liquid Dynamics before the Federal Circuit. In July of 2002, the District Court had granted Vaughan summary judgment on the issue of infringement, but in an appeal prosecuted by FETF, the Federal Circuit reversed the summary judgment because the District Court had erred in interpreting certain claim language (Liquid Dynamics Corporation v. Vaughan Company, Inc., 355 F.3d 1361 (Fed. Cir. 2004)). As a result, the lawsuit was remanded to the District Court for the jury trial which was ultimately held in October 2004.

The Liquid Dynamics trial and appeal team at FETF was led by Steve Schroer, Mark Hetzler and Jon Birmingham. For more information about the firm of Fitch, Even, Tabin & Flannery please see their web site at http://www.fitcheven.com

The two Federal Circuit opinions in the noted case can be accessed via the following links: Liquid Dynamics Corporation v. Vaughan Company, Inc., 05-1105, -1325, -1366, -1399 and Liquid Dynamics Corporation v. Vaughan Company, Inc., 355 F.3d 1361 (Fed. Cir. 2004).