CHARLES F. LETTOW, Judge.
In this patent case, plaintiff, FastShip LLC ("FastShip"), alleges that the United States ("the government") through the Department of the Navy ("the Navy") has infringed Claims 1 and 19 of its U.S. Patent No. 5,080,032 ("the '032 patent") and Claims 1, 3, 5, and 7 of its U.S. Patent No. 5,231,946 ("the '946 patent") and thus is liable for damages under 28 U.S.C. § 1498(a). Compl. ¶ 18. FastShip claims patent infringement regarding the Freedom class of Littoral Combat Ships ("LCS"), specifically LCS-1 (USS Freedom), LCS-3 (USS Fort Worth), and later ships in the class (LCS-5, -7, -9, and -11). Compl. ¶18. Before the court is the government's motion for partial summary judgment pursuant to RCFC 56. Def.'s Mot. for Partial Summary Judgment ("Def.'s Mot."), ECF No. 65. The government avers that LCS-3 and the later allegedly infringing ships were not "manufactured" by or for the government within the meaning of 28 U.S.C. § 1498 prior to the expiration of the patents-in-suit, and they thus provide no basis for FastShip's recovery as to those ships. Def.'s Mot. at 1.
FastShip's allegations of infringement are directed to a class of Navy vessels, specifically littoral combat ships that combine semi-planing monohulls with the use of waterjets for propulsion. Compl. ¶¶ 16-18.
FastShip's '032 patent was issued on January 14, 1992, and the '946 patent, a continuation of the '032 patent, was issued on August 3, 1993. Def.'s Opening Claim Construction Br. Exs. A (U.S. Patent No. 5,080,032) ("'032 patent"), & B (U.S. Patent No. 5,231,946) ("'946 patent"), ECF No. 26. Both patents expired on May 18, 2010.
The '032 patent consists of 20 claims, of which Claim 1 pertains to an apparatus, device, or assembly, stating hull and waterjet limitations. Claim 1 describes:
'032 patent, Claim 1 (emphasis added); see also id., Claim 19 ("[a] vessel conveying method" with similar limitations); '946 patent, Claims 1, 3, 5, & 7 (describing similar limitations with both method and apparatus claims).
LCS-3 is powered by a combination of two diesel engines and two gas turbines that are connected to four waterjets using shafts and gearboxes. Def.'s Mot. Ex. C (Preliminary Technical Manual for LCS-3, Vol. 1 (Nov. 1, 2013)), at 11; see also Def.'s Mot. at 6, Figure 1 (depicting LCS-3 components). Inlets on the bottom portion of the ship's hull draw in water, and the waterjets discharge the water at high velocity, providing propulsive force to the ship. Def.'s Mot. Ex. C, at 66. The monohull of LCS-3 includes the bow (the forward [front] portion), the midships portion, and the stern (the aft [back] portion), with port (left, looking forward) and starboard (right, looking forward) sides. See Hr'g Tr. 31:16-19; see also Pl.'s Opp'n Ex. C (Dep. of Captain Casey J. Moton (Apr. 16, 2015)) ("Moton Dep.") 75:17 to 76:22;
Def.'s Mot. at 6, Figure 1.
Both the superstructure above the main deck of the ship and the hull that supports the superstructure are built in a modular fashion. See Moton Dep. 49:1-3; see also Def.'s Mot. Ex. B (Decl. of Captain Moton (Nov. 17, 2014)) ("Moton Decl.") ¶ 14. The Freedom class ships are constructed in modules, which are then assembled or erected. Moton Dep. 49:14-19. Individual elements of each ship's warfighting system are also modular, allowing components to be interchanged to provide various combat capabilities. Moton Dep. 11:22 to 13:5, 49:9-14.
The modules are developed via a phased process that includes material fabrication, paneling, construction, painting, pre-outfitting, and erection. See Moton Dep. 49:20 to 52:4; see also Moton Decl. ¶ 14; Def.'s Mot. Ex. H (LCS-3 Module Status Chart (May 26, 2010)). Material fabrication consists of the process for building the ship's pieces, and construction requires putting those pieces together to form the structure of a module. Moton Dep. 51:1-4. Pre-outfitting prepares a module for the outfitting process that includes installing insulation, piping, and electrical cabling. Moton Dep. 51:7-15. Erection, the final assembly step, consists of welding individual modules together to comprise either a larger portion of the ship, called a "Grand Module," or the ship itself. Moton Dep. 51:18 to 52:4; Def.'s Mot. at 8. The status of the modules and Grand Modules for LCS-3 as of May 26, 2010, eight days after the '032 and '946 patents expired, are depicted in the figure below.
Def.'s Mot. Ex. H. The bow portion of the hull, comprised of Modules 801, 802, and 803, was still under construction. Id. Similarly, the transom, Module 866, to be secured to the stern section of the hull, was still under construction. Id.
Lockheed Martin and Gibbs & Cox were contracted by the Navy to design and build the Freedom class of LCS. Compl. ¶¶ 12-13. As part of its performance, Lockheed Martin was required to maintain detailed documentation of the design and construction of each LCS. See Pl.'s Opp'n Exs. B (LCS Weekly Report (June 2, 2010)), F (LCS Weekly Report (May 12, 2010)), & H (LCS Weekly Report (Apr. 14, 2010)); see also Def.'s Mot. Ex. A (U.S. Navy Base Contract & Modifications (Feb. 28, 2003 and July 17, 2003, respectively)). Lockheed Martin was also required to "establish, maintain[,] and use an Earned Value Management System (EVMS) meeting the criteria set forth in [Defense Federal Acquisition Regulation Supplement (`DFARS') §] 252.234-7001 . . . as a management tool for cost, schedule[,] and technical performance." See Def.'s Mot. Ex. A, at 81. Further, the contract required submission of a monthly Cost Performance Report, which included a description of the previous month's accomplishments, the Program Cost Status, and the Program Schedule Status. See id. Exs. A, at 97, & E (Excerpts of Cost Performance Reports (June 29, 2009 through June 24, 2012)). An officer in the Navy, Captain Moton, served as the LCS Program Manager's Representative who "was responsible for on-site contract management and oversight for LCS shipbuilding," which included LCS-3. Moton Decl. ¶ 8.
LCS-3 was "on-order" by the Navy on June 26, 2006, to be built at the shipyard of Marinette Marine, Inc. in Marinette, Wisconsin. See Def.'s Mot. at 10.
During September 2009, the two gas turbine engines "were delivered and landed," meaning that they were placed in their ultimate destination in the ship. See Def.'s Mot. at 10; see also id. Exs. E, at 4, & G. The two diesel engines were landed in December 2009. Id. Ex. E, at 6. At least one, but "most likely" all four, of the impellers and housings for the waterjets were present, assembled, and awaiting installation as of April 14, 2010. See Moton Dep. 82:6-20; see also Pl.'s Opp'n Ex. H, at 13. At this time, the impellers and housings had not yet been bolted inside the waterjet tunnels. See Pl.'s Opp'n Ex. H, at 13; see also Hr'g Tr. 28:12-21.
"[A]t the same time that the LCS[-]3 was being constructed," corrosion was detected in waterjet tunnels on LCS-1, located in San Diego. Moton Dep. 57:22 to 58:2, 60:8 to 61:6.
All four waterjet impeller systems were installed in LCS-3 during July 2010, after the expiration of the patents-in-suit on May 18, 2010. Def.'s Mot. Exs. E, at 12, G (Timeline of Events), & J (Photographs of Stern and Bow Modules (July 7, 2010 through Dec. 4, 2010)), at 1; see also Moton Dep. 98:20 to 99:20.
On December 4, 2010, LCS-3 was christened and "launched," although "[a]lignment and connection of the propulsion system continued throughout 2011," as did testing of the ship. Def.'s Mot. Exs. E, at 22-37, & G. On June 6, 2012, LCS-3, USS Fort Worth, was delivered to the Navy. See id. Exs. E, at 38, & G.
FastShip informed the government of the alleged infringement of the patents-in-suit by the Freedom class of LCS on April 11, 2008, when FastShip sent a letter to the Navy setting out an administrative claim demanding compensation for patent infringement. Pl.'s Opp'n Ex. G (Letter from FastShip to the Navy (Apr. 11, 2008)). Two years later, on April 28, 2010, the Navy sent a reply to FastShip's counsel, informing FastShip that the Navy had investigated the claim and had chosen to deny the claim because it did not believe that the Freedom class of ships infringed the patents owned by FastShip. Id. Ex. I (Letter from the Navy to FastShip (Apr. 28, 2010)). On June 15, 2010, FastShip reiterated the "allegations of patent infringement." Id. Ex. J (Letter from FastShip to the Navy (June 15, 2010)).
FastShip filed suit in this court on August 1, 2012, alleging that the Navy's "unlicensed use and manufacture" of LCS-1 and LCS-3 infringed its '032 and '946 patents. Compl. ¶ 18. FastShip further claimed that LCS-5, -7, -9, and -11, "under construction or on order," potentially constituted an infringement of its patents. Compl. ¶ 14. The parties briefed claim construction in August and September of 2013 and conducted a technological tutorial for the court on August 27, 2013. On September 13, 2013, the parties presented arguments at a Markman hearing, and the court issued an order on October 9, 2013, construing seven terms of the patents. See FastShip, LLC v. United States, 114 Fed. Cl. 499 (2013).
On November 26, 2014, the government filed its motion for partial summary judgment of non-liability on FastShip's claims for patent infringement with regard to LCS-3, -5, -7, -9, and — 11. Def.'s Mot. at 1. This motion has now been thoroughly briefed and was argued at a hearing held on June 8, 2015.
As explicated in 28 U.S.C. § 1498, the United States has waived sovereign immunity and granted this court exclusive jurisdiction to adjudicate patent infringement claims against the federal government "[w]henever an invention described in and covered by a patent of the United States is used or manufactured by or for the United States without license of the owner thereof or lawful right to use or manufacture the same." 28 U.S.C. § 1498(a); see also Martin v. United States, 99 Fed. Cl. 627, 632-33 (2011) (recognizing that Section 1498, rather than the Tucker Act, 28 U.S.C. § 1491(a), grants this court jurisdiction over patent infringement claims against the United States). The statute further states, in relevant part, that "the use or manufacture of an invention described in and covered by a patent of the United States by a contractor, a subcontractor, or any person, firm, or corporation for the Government and with the authorization or consent of the Government, shall be construed as use or manufacture for the United States." 28 U.S.C. § 1498(a) (emphasis added). The unauthorized "use or manufacture of an invention" under Section 1498(a) is analogous to a taking of property under the Fifth Amendment of the United States Constitution. See Motorola, Inc. v. United States, 729 F.2d 765, 768 (Fed. Cir. 1984); see also Hughes Aircraft Co. v. United States, 29 Fed. Cl. 197, 208 (1993). In this respect, the government "takes" a non-exclusive and compulsory license to any United States patent "as of the instant the invention is first used or manufactured by [or for] the [g]overnment." Decca Ltd. v. United States, 640 F.2d 1156, 1166 (Ct. Cl. 1980); see also Liberty Ammunition, Inc. v. United States, 119 Fed. Cl. 368, 385 (2014), appeals pending, Nos. 15-5054, 15-5061 (Fed. Cir.).
Given that the government has waived sovereign immunity only for the compulsory taking of a non-exclusive patent license, government liability under 28 U.S.C. § 1498 diverges from private liability under 35 U.S.C. § 271:
de Graffenried v. United States, 25 Cl. Ct. 209, 215 (1992) (alteration in original); compare 28
U.S.C. § 1498, with 35 U.S.C. § 271.
"The court determines whether the government has engaged in direct infringement [of a patent] using a two-step process that parallels the analysis for infringement litigation between private parties." Liberty Ammunition, 119 Fed. Cl. at 385 (citing Lemelson v. United States, 752 F.2d 1538, 1548 (Fed. Cir. 1985)); see also Casler v. United States, 15 Cl. Ct. 717, 731 (1988), aff'd, 883 F.2d 1026 (Fed. Cir. 1989). Initially, the court construes the claims of the patent and then compares those claims to the characteristics of the accused product or process. See JVW Enters. v. Interact Accessories, Inc., 424 F.3d 1324, 1329 (Fed. Cir. 2005). When comparing the patent claims to the accused device or process, the plaintiff has the burden of proving by a preponderance of the evidence that every limitation set forth in a patent claim is present in the accused device or process either literally or by a substantial equivalent. Boeing Co. v. United States, 69 Fed. Cl. 397, 426 (2006) ("[E]ach element of a claim is material and essential, and . . . for a court to find infringement, the plaintiff must show the presence of every element [for literal infringement] or its substantial equivalent [for infringement under the doctrine of equivalents] in the accused device.") (alteration in original) (quoting Lemelson, 752 F.2d at 1551). This standard is commonly referred to as the "all elements" rule. See TDM Am., LLC v. United States, 92 Fed. Cl. 761, 768 (2010), aff'd, 471 Fed. Appx. 903 (Fed. Cir. 2012); see also Warner-Jenkinson Co. v. Hilton Davis Chem. Co., 520 U.S. 17, 29 (1997). The plaintiff's failure to meet even one element within a claim, literally or by its substantial equivalent, negates a finding of infringement. See Laitram Corp. v. Rexnord, Inc., 939 F.2d 1533, 1535 (Fed. Cir. 1991).
A grant of summary judgment is appropriate when the pleadings, affidavits, and evidentiary materials filed in a case demonstrate that "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." RCFC 56(a). A material fact is one "that might affect the outcome of the suit under the governing law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A genuine dispute is one that might "return a verdict for the nonmoving party." Id. If "the record taken as a whole [cannot] lead a rational trier of fact to find for the non-moving party, there is no `genuine issue for trial,'" and summary judgment is appropriate. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (quoting First Nat. Bank of Ariz. v. Cities Serv. Co., 391 U.S. 253, 288 (1968)).
The moving party has the burden of demonstrating the absence of genuine disputes. In that respect, "the inferences to be drawn from the underlying facts . . . must be viewed in the light most favorable to the party opposing the motion." Matsushita, 475 U.S. at 587-88 (quoting United States v. Diebold, Inc., 369 U.S. 654, 655 (1962)); see also Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The non-moving party may defeat summary judgment by presenting material facts of its own, more than "[m]ere denials or conclusory statements," that indicate "an evidentiary conflict created on the record." Barmag Barmer Maschinenfabrik AG v. Murata Mach., Ltd., 731 F.2d 831, 836 (Fed. Cir. 1984). To establish "that a fact cannot be or is genuinely disputed," a party must "cite[] to particular parts of materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations (including those made for purposes of the motion only), admissions, interrogatory answers, or other materials." RCFC 56(c)(1)(A).
The salient elements required for a vessel subject to the claimed invention include: (1) "a hull," (2) "at least one inlet," (3) "at least one waterjet coupled to the at least one inlet," and (4) "a power source coupled to the at least one waterjet." See, e.g., '032 patent, col. 14, lines 1-18 (Claim 1); see also Def.'s Reply at 8-9. The dispositive issue before the court on the government's motion is whether these allegedly infringing elements of LCS-3 were "manufactured" during the term of the '032 and '946 patents. See Hr'g Tr. 12:12-17; see also 28 U.S.C. § 1498(a).
The term "manufacture" has not been defined in patent law; instead, its meaning has been developed by courts based on the circumstances at hand. See Hughes Aircraft, 29 Fed. Cl. at 226 ("We glean from [case] precedents that the question of what constitutes `use' [and `manufacture'] is a mixed question of fact and law to be determined on a case-by-case basis.") (emphasis added).
In 1972, "the question of manufacture" under 35 U.S.C. § 271 was considered by the Supreme Court in Deepsouth Packing Co. v. Laitram Corp., 406 U.S. 518, 527 (1972). At issue in Deepsouth was whether the sale to foreign customers of subassemblies of a patented shrimp deveiner with the intent that the recipients would assemble the components abroad constituted infringement of two combination patents under 35 U.S.C. § 271. See id. at 523-24 (explaining that Deepsouth Packing Co. was "shipping deveining equipment to foreign customers in three separate boxes, each containing only parts of the 1 3/4-ton machines," that could be fully assembled "in less than one hour"). The majority opinion by Justice White answered that question in the negative. Id. at 532. In finding non-infringement, Justice White relied on general principles of patent law:
Id. at 528 (emphasis added) (quoting Mercoid Corp. v. Minneapolis-Honeywell Regulator Co., 320 U.S. 680, 684 (1944)); see also Aro Mfg. Co. v. Convertible Top Replacement Co., 365 U.S. 336, 344 (1961) ("For if anything is settled in the patent law, it is that the combination patent covers only the totality of the elements in the claim and that no element, separately viewed, is within the grant."); Leeds & Catlin Co. v. Victor Talking Mach. Co., 213 U.S. 301, 320 (1909) ("To be that,—to be identical with the invention of the combination,—they must be united by the same operative law."). In Deepsouth, Justice Blackmun, joined by Chief Justice Burger and Justices Powell and Rehnquist, dissented on the ground that the majority had taken "too narrow a reading of 35 U.S.C. § . . . 271(a)." 406 U.S. at 532.
Twelve years later, the Federal Circuit also addressed the meaning of the term "make" for purposes of 35 U.S.C. § 271 in Paper Converting Mach. Co. v. Magna-Graphics Corp., 745 F.2d 11 (Fed. Cir. 1984). At issue in that case was "the extent to which a competitor of a patentee can manufacture and test during the life of a patent a machine intended solely for post-patent use." Id. at 16 (emphasis in original). The patent-in-suit was for an automatic rewinder used to make rolls of toilet tissue and paper towels, and the machine at issue operated as follows:
Id. at 15.
Although the accused infringer, Magna-Graphics, "normally fully tested machines at its plant before shipment," the company engaged in a "scheme to avoid patent infringement" by conducting its tests in two noninfringing stages. Paper Converting, 745 F.2d at 15 (emphasis in original). In the first stage of testing, Magna-Graphics "checked the bedroll to determine whether the pushers actuated properly . . .[, but] no cutoff blades or pins were installed." Id. In the second stage of testing, Magna-Graphics "checked the cutoff roll to determine whether the cutting blade actuated as intended . . .[, but no] pins, pushers, and blade [were] installed." Id. Then, after negotiating a shipment agreement with the purchaser, Magna-Graphics shipped "the basic rewinder machine . . . and cutoff roll and bedroll" in separate packages on different dates. Id. at 15-16. The purchaser had agreed not to fully assemble the machine until two days after the patent had expired. Id. "Given the amount of testing performed [t]here, coupled with the sale and delivery during the patent-term of a `completed' machine (completed by being ready for assembly and with no useful noninfringing purpose)," the Federal Circuit found Magna-Graphics' machine to be infringing. Id. at 19. The court of appeals reasoned that "a contrary result would emasculate the congressional intent [of] prevent[ing] the making of a patented item during the patent's full term" and would allow an "unscrupulous competitor [to] aggressively market[] its own product and construct[] it to all but the final screws and bolts." Id.
Several judges of this court have sought to limn "the boundaries of the problem" posed in deciding when "a device has been `manufactured' for purposes of [28 U.S.C. § 1498]." Hughes Aircraft, 29 Fed. Cl. at 219. In Hughes Aircraft, the government was accused of infringing a patent "for controlling the attitude of a spin-stabilized spacecraft." Id. at 201. The government disputed liability, arguing that some of the spacecraft at issue had not been manufactured before the patent expired because they contained inoperable test parts (or "dummy parts"). Id. at 220. "The test parts would not have been used when the spacecraft was launched and, in many cases, were . . . included only to give the spacecraft the appropriate mass and balance during the testing process." Id. Since the "dummy parts [were] not intended to be launched into space, the government reason[ed], their inclusion on the spacecraft render[ed] the spacecraft inoperable" under Deepsouth. Id. The court disagreed with the government, holding:
Id. (emphasis added).
Alternatively, the government in Hughes Aircraft averred that the spacecraft had not been "manufactured" based "on the fact that the full testing process . . . was not complete on any of the spacecraft in issue by the expiration date." 29 Fed. Cl. at 221. The court also rejected that argument. It concluded that testing, while important, see id. ("The importance of testing to these spacecraft cannot be overstated."), was not part of the manufacturing process, id. at 221-22. Rather, it was "part of a later process for perfecting the ability of the object to perform its intended use . . ., [which] simply d[id] not fall within any fair usage of the term `manufacture.'" Id. at 222. To hold otherwise, as the court observed, would "obliterate[] the distinction in § 1498 between `use' and `manufacture.'" Id.
Although there are factual differences between the status and condition of LCS-3 at issue in this case and the accused products in Deepsouth, Paper Converting, and Hughes Aircraft, the legal principles pertinent to those prior decisions still apply. See, e.g., East Coast Sheet Metal Fabricating Corp. v. Autodesk, Inc., No. 12-CV-517-LM, 2015 WL 226084, at *15 (D.N.H. Jan. 15, 2015), amended in part, No. 12-CV-517-LM, 2015 WL 925614 (D.N.H. Mar. 3, 2015), appeal pending, No. 15-1717 (Fed. Cir.) (recognizing the distinct factual situation in Deepsouth but relying on the general principles of patent law applied by the Supreme Court in that decision). Accordingly, the court finds it appropriate to draw on these cases for guidance when analyzing the government's motion for partial summary judgment.
The government focuses on two key elements of LCS-3, the waterjet impeller assemblies and the hull, which it contends were incompletely fabricated or assembled by the expiration of the FastShip patents.
The patents at issue required "at least one waterjet coupled to the at least one inlet" and "a power source coupled to the at least one waterjet." See, e.g., '032 patent, col. 14, lines 15-18. Because the waterjet impeller assemblies were not installed in the waterjet tunnels before the patents-in-suit expired, the government maintains "that the waterjet element has not been `coupled' to the inlet [or the power source] as required by the claims." Def.'s Reply at 9. FastShip concedes that the waterjet impeller assemblies were not installed before the patents expired, Pl.'s Opp'n at 6, but points out that at least one waterjet impeller assembly was available on-site waiting to be bolted to a waterjet power shaft, see id. Ex. H, at 13. According to FastShip, "[t]he actual bolting on of the available [waterjet] impeller assembly was not a significant event in the completion of the patented assembly," id. at 12, and therefore, "the letter and spirit of the claimed inventions had been manufactured by [the government] by the expiration date," id. at 13, of the patents.
FastShip's argument would sidestep the requirement of an "operable assembly of the whole." Deepsouth, 406 U.S. at 528. Bolting may have been a relatively straightforward and quick process, but the fact remains that this final installation step for any of the four waterjet impeller assemblies did not occur until after the expiration date of the '032 and '946 patents. As of May 18, 2010, no "waterjet" was "coupled" to an "inlet" or a "power source," see '032 patent, col. 14, lines 15-18, and instead, each of the four waterjet impeller assemblies remained uninstalled and incapable of propulsion, see Def.'s Mot. at 19. On these facts, Deepsouth's legal principle of an "operable assembly of the whole" has not been met. 406 U.S. at 528; cf. Hughes Aircraft, 29 Fed. Cl. at 220 (finding spacecraft at issue to be an operable assembly where the spacecraft "had completed systems installation as of the expiration date [of the patent]") (emphasis added).
FastShip endorses the rationale of Paper Converting because it considers the factual circumstances of Paper Converting to be analogous to the present situation. See Pl.'s Opp'n at 25. According to FastShip, the court should be guided by the Federal Circuit's decision in Paper Converting because "[the Navy] knew of the existence of [p]laintiff's patents and [p]laintiff's claims of infringement of those patents years before those patents expired. Nevertheless, by the time the patents expired, [the Navy had] engaged in substantial manufacture of the LCS-3, a long leadtime article, to the point of assembly of all parts that are alleged to correspond to the claimed invention." Id. In essence, FastShip inferentially suggests that the Navy did not move with alacrity to fully assemble LCS-3 because it was aware that FastShip's patents were expiring.
The court is not persuaded by FastShip's arguments. Unlike in Paper Converting, where Magna-Graphics intended to manufacture a patented machine and attempted to circumvent infringement by purposefully selling the machine in non-infringing components to be combined after the patent had expired, 745 F.2d at 15-16, FastShip has offered no sound evidence to show that the Navy intentionally delayed installation of waterjet impeller assemblies on LCS-3 for the similar purpose of avoiding infringement.
Portions of the bow of the vessel had also not been installed prior to the expiration date of the patents-in-suit. FastShip argues that it is not appropriate for the court to consider the status of the bow because that portion of the vessel is "not specifically claimed in the asserted patent claims and is not a material limitation." Pl.'s Opp'n at 12. The patents-in-suit claim "a vessel comprising . . . a hull . . . having a length in excess of 200 feet [and] a displacement in excess of 2000 tons" that generates "high pressure" in the stern area. See, e.g., '032 patent, col. 13, line 68 to col. 14, line 9 (emphasis added).
The Grand Bow Module was transported for erection to the rest of the hull in mid-August of 2010. Prior to that time, the modules of the bow were under construction, waiting to be combined into the Grand Bow Module and then to be welded to the rest of the vessel, see Moton Dep. 102:7 to 105:11; see also Def.'s Mot. Ex. H, as seen in the photographs below:
Def.'s Mot. Ex. I, at 2 (LCS-3 Photographs (May 19, 2010)) (showing status of Module 803, a component of the bow, the day after the patents-in-suit had expired). Id. Ex. I, at 3 (depicting status of Modules 801 and 802, parts of the bow, one day after the '032 and '946 patents had expired).
Even after completing the "construction" stage of assembly, the modules for the bow still needed to go through the process of "pre-outfitting" before being "erected" to the rest of the hull. See Def.'s Reply at 10 (citing Moton Decl. at ¶ 14); see also Def.'s Mot. Ex. J, at 2. Based on these facts, those modules were not ready to be assembled into the Grand Bow Module or installed to the other portions of the hull on the date when the patents-in-suit expired. Cf. Paper Converting, 745 F.2d at 19 (defining "completed machine" as "being ready for assembly and with no useful noninfringing purpose") (emphasis added); Hughes Aircraft, 29 Fed. Cl. at 220 (ruling where the spacecraft at issue had completed a systems installation stage that was "the final assembly stage during which all of the components, subsystems[,] and systems ordinarily would be installed") (emphasis added). Instead, "[t]he photographs of the state of assembly on or shortly after that date [i.e., the patent expiration date,] show that LCS-3 could not possibly float by May 18, 2010," Def.'s Reply at 7, and the "hull" element of the claims remained incomplete and inoperable, see Deepsouth, 406 U.S. at 528.
In sum, based on general tenets of patent law and in light of the distinct facts presented in this case, the court finds that the allegedly infringing LCS-3 was not "manufactured" for purposes of Section 1498(a) by the date the pertinent patents expired.
For the reasons provided, the government's motion for partial summary judgment is GRANTED because there are no genuine issues of material fact with regard to manufacture of LCS-3. The pertinent vessel, USS Fort Worth, and the later constructed LCS-5, -7, -9, and -11 shall be dismissed from, and not given further consideration in, this action.
The parties are requested to provide by July 22, 2015, a plan and schedule for completing preparations of this case for trial.
It is so ORDERED.
As of May 18, 2010, Captain Moton estimated that LCS-3 was 74.5% complete, based upon the percentage completion of each of the modules combined to form "a ship level summary number." Moton Dep. 69:8 to 71:15. This completion estimate was for LCS-3 overall, including unpatented features and structures. The completion of the patented assembly would have exceeded this estimate. Pl.'s Opp'n at 5-6. As discussed infra, however, the percentage completion values are immaterial to the court's decision in this case.
35 U.S.C. § 271(a) (emphasis added).
35 U.S.C. § 271(f)(1). While the amendment countermanded the Supreme Court's decision "not to make it infringement where the final assembly and sale is abroad," S. Rep. No. 98-663, the statute "neither defined the terms `make,' `use' or `sell' nor overruled Deepsouth's interpretation of those terms," Hughes Aircraft, 29 Fed. Cl. at 218 n.22.
