Claims Not Anticipated
AMP Report & Burks Article
Fraud on Patent Office
25 Other Patents & Apps.
SR-IBM 8/21/56 Agreement
SR-IBM Settlement of Interferences
SR-BTL 1961 Agreement
SR-IBM 1965 Agreement
Pending Application Royalties
Section 7, Clayton Act
Statute of Limitations
Infringement of ENIAC
Declaratory and Injunctive Relief
Order for Judgment
Table of Authorities
14. 25 Other Patents and Patent Applications
- These are the so-called 30A patents and patent applications.
- Honeywell amended its Amended Complaint (by Order of Court entered September 19, 1969) to add paragraph 30A, alleging that SR claimed to own or control a "Patent Portfolio" containing issued patents and pending patent applications that are subject to the same types of infirmities as the ENIAC Patent, and that the procurement, licensing and attempted enforcement by SR of these additional patents and applications constituted a further part of the originally alleged fraudulent and conspiratorial pattern of conduct by SR in restraint of trade.
- Honeywell contends that these applications and patents (hereinafter "the 30A patents and applications") evidence a pattern of conduct calculated to procure and maintain a patent portfolio of dominance over the computer industry, and that the 30A patents and applications have been and are being procured in disregard of the uncompromising duty of fairness and full disclosure to the Patent Office and the courts in patent matters.
- During the discovery stage of this lawsuit, SR produced for Honeywell's inspection and copying hundreds of SR patent application files.
- Several have been abandoned, several have expired, and two --- BINAC and UNIVAC --- are still pending.
- Honeywell has offered evidence with respect to twenty-five 30A patents and applications to establish SR's pattern of prosecuting applications and procuring patents known to be barred by printed publications, public uses, sales, or other invalidating infirmities.
- In addition to its charges concerning the ENIAC patent, Honeywell has charged fraud on the Patent Office in connection with two pending patent applications, two abandoned patent applications, and 19 patents (ten of which have expired).
- These other patents and patent applications within SR's EDP portfolio are as follows:
|Patent No. or Application No. If No Patent Has Issued|
|Name||Issue Date or Condition If No Patent Has Issued|
|8||2,969,478||6/10/49||Electrostatic Storage Memory||1/24/61|
|19||2,708,554||7/29/50||Uniservo Tape Unit||5/17/55|
|19a||3,189,290||7/29/50||Uniservo Tape Unit||6/15/65|
|19b||2,901,734||7/29/50||Uniservo Tape Unit||8/25/59|
|20||2,686,299||6/24/50||BINAC Function Table||8/19/54|
|21||2,600,744||10/21/50||Serial Binary Adder||6/17/52|
|22||S.N. 179,782||8/16/50||BINAC System||Still Pending|
|25||2,673,293||10/21/50||Serial Binary Full Adder||3/23/54|
|26||2,655,598||10/21/50||Parallel Binary Adder||10/13/53|
|27||S.N. 194,112||11/4/50||Excess-3 Binary Coded Decimal Adder||Abandoned|
|28||S.N. 213,072||2/28/51||Parallel Excess-3 Binary Coded Decimal Adder||Abandoned|
|29||2,590,950||11/16/50||Function Table Full Adder||4/1/52|
|39 ||S.N. 279,710||3/31/52||UNIVAC System||Still pending|
|42||3,133,190||3/31/52||UNIVAC Arithmetic Unit||5/12/64|
|43||2,781,446||3/28/52||UNIVAC Cycling Unit||2/12/57|
|44||3,056,947||3/31/52||Card to Tape Unit||10/2/62|
|48||2,748,270||3/31/52||UNIVAC Clock Gate and Pulse Former||5/29/56|
|--||2,842,663||6/10/55||Binary Signal Comparator||7/8/58|
|--||2,915,966||6/13/55||High Speed Printer||12/8/59|
|--||2,938,193||6/10/55||Binary Signal Encoder||5/4/60|
- Plaintiff has not been directly charged with infringement of any of the issued patents.
- SR has raised no counterclaim in this case charging Honeywell with infringement of any patents, but ISD has raised a counterclaim for infringement of the ENIAC patent.
- SR and ISD have represented to this Court that no charge of infringement has been directed against Honeywell under any patents other than the ENIAC patent.
- Plaintiff claims, however, that these patents and patent applications were referred to as part of defendant's portfolio in the negotiations which preceded this lawsuit.
- When Honeywell and other competitors within the EDP industry raised their own patents against SR as trading material to offset ISD's charges of infringement of the ENIAC patent, SR responded by correspondingly raising other patents and patent applications, including its 30A patents and applications, for bargaining purposes in the negotiation of any possible overall cross-license settlement of the ENIAC patent controversy.
- For example, ISD had sought a one and one-half percent royalty from National Cash Register Co. (NCR) for license rights under the ENIAC patent; and in the negotiation for a possible overall cross-license between NCR and SR, including the ENIAC patent being asserted by ISD, SR contended that an equal exchange was inappropriate because additional royalties should be accorded to the weight of its EDP patent portfolio including its 30A patents and applications, over NCR's portfolio.
- SR had called over 1000 of its patents to the attention of GE, including the ENIAC patent and its 30A patents and applications, and sought royalties of 8.5 million dollars; SR internally registered doubt as to the enforceability of the ENIAC patent, and estimated that the "Chance of winning in court is less than 50%."
- When a one and one-half percent royalty was sought from RCA under the ENIAC patent, SR contended that the rest of its EDP portfolio, including its 30A patents and applications, had "a greater value than the ENIAC patent."
- SR and ISD had contended in their negotiations with RCA that SR's portfolio of other patents, including the 30A patents and such 30A applications as BINAC and UNIVAC I, gave SR the "basic position in the systems area."
- During negotiations with Honeywell, SR discussed ten patents from its EDP portfolio, including the EM-1 regenerative memory or '827 patent and the high-speed printer of '966 patent among the 30A group; the fact of the pendency of SR's UNIVAC application, within the 30A group, was also considered, SR contended that its patent portfolio, exclusive of ENIAC but including the 30A patents and applications, was at least as valuable as the entirety of Honeywell's EDP patent rights.
- Plaintiff claims also that they were used as leverage in obtaining the IBM and BTL license agreements.
- On August 21, 1956, IBM and Sperry Rand entered into an agreement including:
.1 a cross-license under all of their respective EDP and tabulating (TAB) equipment patents and patent applications, including the ENIAC application and the 30A patents and applications;
.2 a settlement of all EDP and TAB Patent Office interferences; and
.3 an exchange of secret and proprietary EDP and TAB equipment know-how.
- BTL and Western Electric entered into a cross-license with SR dated July 1, 1961.
- Plaintiff claims that the fraudulent procurement of the portfolio was part of an overall scheme to monopolize and restrain trade.
- The emphasis in plaintiff's claim of infirmities is on public use and on sale.
- Other claims rest on derivation from Atanasoff, incomplete application at time of execution, and omission of co-inventors.
- As to publication, plaintiff relies on the First Draft Report (already found to be a printed publication before the critical date) [Findings 7.1-7.1.6 above], the EDVAC report of September 30, 1945, the EDVAC report of June 30, 1946, three lectures of the Moore School lecture series, and the report on the UNIVAC.
- I find that as part of an action in antitrust that plaintiff has standing to assert these claims, that no claims of infringement have been made by defendants on the issued patents, and that defendants have made no demands for royalties on the applications.
- I find that the publications referred to above (In Finding 14.9) were printed publications before the critical dates, that the claims as to public use and on sale before the critical date have been proved, that the claims as to derivation from Atanasoff as to EM-1 have been proved, that the claims as to incomplete execution have been proved, and that the claims as to the omission of a certain inventor has been proved.
The June 30, 1946, EDVAC Report
- The Progress Report on the EDVAC, dated June 30, 1946, (hereafter called the EDVAC Report) became a printed publication more than one year prior to June 10, 1949, the filing date of the EM-8 application.
- The Court notes that in prior litigation, SR swore in answer to an interrogatory that the publications date of the EDVAC Report was June 30, 1946.
- The EDVAC Report was completely declassified on or before February 13, 1947.
- During the spring of 1947, persons skilled in the computer art were notified about the declassification of the EDVAC Report.
- The declassification of EDVAC information, such as the EDVAC Report, was widely publicized during March of 1947, including press reports in the New York Times, Philadelphia Bulletin, and Philadelphia Inquirer.
- By the spring of 1947, Eckert and Mauchly were aware of the declassification of the EDVAC Report.
- By March 1948, the EDVAC Report had been widely distributed and was available to all persons having an interest in the computing arts, as a result of its unrestricted classification, its availability to persons attending the 1946 Moore School Lecture Series and its availability in the Library of Congress.
- By the end of June, 1948, copies of the EDVAC Report were available in the Moore School Library and were being loaned by that library to other institutions, including Johns Hopkins University; a review of the EDVAC Report was published in the January 1949 edition of Mathematical Tables and Other Aids to Computation, and Eckert cited the EDVAC Report in an article (which he co-authored) published in the August 1949 edition of the Proceedings of the I.R.E.
- In 1957, SR's patent agent, English who was assigned to an EM-8 interference, withheld the existence of the EDVAC Report from the Patent Office "since it might be used as an anticipating publication against our application EM-8."
- The stated purpose of the EDVAC Report was to serve as a disclosure to the Patent Office of possibly patentable ideas, and Eckert, Mauchly and defendants' predecessors and lawyers used the EDVAC Report to this end; in October 1946, Eckert and Mauchly asked for and received permission to inspect the EDVAC Report for the purpose of preparing patent applications; the following applications or patents were derived from portions of the EDVAC Report by Mr. Eltgroth, a patent attorney for Eckert-Mauchly Computer Corporation team (EMCC) and Remington Rand (RR), both predecessors of SR: EM-21, 23, 25, 26, 27, 28, and 29; two attorneys, Messrs. Eltgroth and Light, handled the prosecution of each of these patent applications; examples of the correspondence of the EDVAC Report with the applications or patents are hereinafter found and set forth.
- Figure 1 of the EM-21 patent has a one-for-one relationship in all significant respects to EDVAC Report drawing PY-0-105, described at pages 1-1-2 through 1-1-5 of the EDVAC Report; Figure 1 of the EM-23 patent shows the same circuit, except for immaterial variations, as that shown and described in EDVAC Report drawing PY-0-105 and pp. 1-1-2 through 1-1-5; Figures 5, 6, and 7 of the EM-25 patent show the same circuits as are shown and described in EDVAC Report drawings PY-0-177; PY-0-178 and PY-0-174 and at pp. 1-1-11 through 1-1-13; Figure 2 of the EM-26 patent shows the same circuit as that shown and described in EDVAC Report drawing PY-0-177 and page 1-111 of the EDVAC Report.
- During August, 1952, the patent examiner assigned to the EM-27 application located that EDVAC Report unaided by defendants or their attorneys and found that: "This reference [the EDVAC Report] discloses a circuit which is manifestly identical in all respects to the instant alleged invention"; the Court concurs with the examiner's finding; Figure 1 of the EM-27 application shows the same circuit as that shown and described in Report drawing PY-0-108 and pages 1-1-27 through 1-1-29 of the EDVAC Report; RR's attorney prosecuting EM-27, E.J. Light, also concurred, stating that the EDVAC Report was "a publication identical to the disclosure" of EM-27.
- Figure 1 of the EM-28 application illustrates the same circuit shown and described in EDVAC Report drawing py-0-181 and pages 1-1-29 through 1-1-30 of the EDVAC Report.
- Figures 1 and 2 of the EM-29 case were based upon drawings PY-0-101 and PY-0-102 of the EDVAC Report; when the EM-29 application was drawn into an interference (No. 85, 958), RR's patent attorney, Light, reported to Eckert and Mauchly that the adder described in the EM-29 patent was described in the EDVAC Report.
- Yet RR's attorneys failed to state to the Patent Office at any time during the EM-29 prosecution and interference that the EM-27 examiner had found the EDVAC Report to be a printed publication more than one year prior to the EM-29 filing date.
The Moore School Lecture Series
- During July and August of 1946, a lecture series was held at the Moore School entitle "Theory and Techniques for Design of Electronic Digital Computers."
- The lectures were recorded and edited by the respective lecturers for publications, and were published in four volumes between September 10, 1947 and June 30, 1948.
- These published lectures (hereinafter called the "Lecture Series") were made available in the Moore School Library, and Lecture 1 through 48 in fact were checked out by borrowers prior to October 17, 1949; this same Lecture Series was also made available at the Library of Congress on or before November 12, 1948.
- The following applications or patents were based substantially on portions of the Lecture Series, published before the earliest critical date of the applications or patents: EM-21, 25 and 26, all filed on October 21, 1950; and EM-28, filed February 28, 1951.
.1 Figure 1 of EM-21 shows the same circuit as that shown and described by Eckert in Lecture 23.
.2 Figure 5 of the EM-25 case is also shown and described by Eckert in Lecture No. 23.
.3 Figure 1 of the EM-26 case is derived from Figure 6 of Lecture No. 46, and Figure 2 of EM-26 shows the same circuit shown and described in Lecture 23.
.4 The alleged invention of EM-28 is shown and described in Lecture No. 46; this is the case in which the examiner found the published Lecture and rejected the application, stating: "Claims 1-7 are rejected as fully met by the Moore School Publication"; RR did not contest the rejection, but instead abandoned the case.
- By summer of 1949, more than one year before Eckert and Mauchly filed EM-21, 25, 26, or 28, they both were aware that the published Lecture Series was publicly available; Mauchly observed as much to his attorney Eltgroth, writing, on May 2, 1949, that as a result of the published review of the Lecture Series "a larger segment of the public will now be aware of their existence. I believe that these lectures should be on file in the patent department"; Mauchly also noted in the same communication that the publication announced the "availability of the lecture course" and "that these lectures are now available at $5.00 per volume as long as the supply holds out."
- Of the EM-21, 25, 26 and 28 applications, only EM-28 failed to issue because the EM-28 examiner found the published Lecture Series on his own initiative and rejected the applications "as fully met by the Moore School Publication [Lecture No. 46] cited above"; however, the Examiners of the EM-21, 25, and 26 applications (all of which ultimately issued as patents) failed to find the published Lecture Series, and defendants' predecessors' attorneys, Eltgroth and Light, did not inform those examiners about the Lecture Series or the rejection of the EM-28 application thereon.
The First Draft Report
- In addition to the barring of the valid issuance of the ENIAC patent, the publication of the von Neumann First Draft Report also anticipates the claims of the EM-1 patent No. 2,629,827 entitled "Regenerative Memory."
The Report on the UNIVAC
- During the fall of 1947, Eckert and Mauchly submitted under contract to the Bureau of Standards a Report on the UNIVAC. This report discussed all phases of a proposed UNIVAC computer and included many detailed schematic diagrams of circuits to be employed in the UNIVAC computer.
- In 1947 and 1948, copies of the Report on the UNIVAC were widely distributed and effectively "published" with the knowledge and consent of high-ranking officers of SR's predecessor, the Eckert-Mauchly Computer Corporation (EMCC); the distribution included: making the report available to the Prudential Insurance Company, circulating the Report, according to Mauchly, "rather widely through governmental agencies"; and making the Report available at the library at Harvard University.
- An employee of EMCC, Isaac Auerbach, assessed the widespread distribution of the Report in an April 8, 1948 memo, stating with respect to a suggestion to limit its further reproduction: "What a laugh at this late date!...Our report already received widespread circulation."
- During April 1948, EMCC requested an opinion from its patent attorneys, Busser and Harding, about the steps which it might take to call in copies of the Report on the UNIVAC which the Bureau of Standards had already published.
- With regard to the testimony of McPherson (a disinterested non-party witness) and Mauchly relating to Mauchly's statement to McPherson that the Report on the UNIVAC was studied at the Harvard University Library, the Court finds McPherson credible.
- SR and ISD admit that the Report on the UNIVAC was made available to Prudential; on October 12, 1948, EMCC was informed by Cannon of the Bureau of Standards that the Report on the UNIVAC shall be "available to all governmental agencies requesting it, unless you [EMCC] can furnish us with a sound reason for refusing the request"; EMCC replied that it had no such objection; on July 8, 1949, attorney Eltgroth informed Mauchly that the Report "will be available on a reciprocal basis to parties having a legitimated interest therein."
- Many patent applications describing the UNIVAC computer were filed by RR. These applications are anticipated by the Report on the UNIVAC which provided a detailed description of the same UNIVAC computer. These applications include EM-14 (filed April 13, 1950), and EM-39 through 44 and 48 (all filed March 31, 1952, except EM-43, filed March 28, 1952).
- RR's patent attorney, Eltgroth, admitted that the computer described in the EM-22 application is disclosed in the Report on the UNIVAC, stating that "the computer described in that application [EM-22] is operable and embodies all the essential material of the study report"; Eltgroth earlier indicated that "applications have been filed or are now being filed for a considerable portion of the inventive material disclosed in these reports..."; while Eltgroth went on the conclude that the reports had not been published, the Court finds that this was not correct.
- SR admits that the EM-20 application purported to cover the encoding and decoding function tables used with the BINAC system shipped to Northrop during 1949; in order to prove prior inventorship, Eckert filed an affidavit claiming such an invention prior to May 6, 1948, and supported the affidavit with drawing D69-1077 entitled "Tank Selector Circuit of Memory Switch"; this drawing was a part of the Report on the UNIVAC; the subject matter of the EM-20 is disclosed in, and therefore anticipated by, the Report on the UNIVAC but such Report was not brought to the attention of the EM-20 examiner by defendants or their predecessors.
- SR has admitted that the subject matter claimed in the EM-39 through 44 and 48 applications was embodied in the Census Univac system turned over to the U.S. Census Bureau during March, 1951; the Report on the UNIVAC described the Census Univac system in comprehensive detail; there were some changes made to the Census Univac system after the Report was made; however, these changes do not materially affect the Report's disclosure of the subject matter of EM-39-44 and 48; in view of the foregoing, the Court finds that the Report on the UNIVAC anticipates the EM-39 application and the EM-40-44 and 48 patents.
- Public Use and On Sale
- Eckert, Mauchly and EMCC placed an electrostatic information storage system claimed in the EM-8 application and patent in public use and on sale in the United States more than one year prior to the application filing date.
- During January, 1948, EMCC demonstrated to personnel of the U.S. Bureau of Standards and the U.S. Bureau of Census a model of an electrostatic information storage system which Eckert and Herman Lukoff had built.
- During January, 1948, the electrostatic information storage system was demonstrated to Standards and Census personnel, including Messrs. Cannon and Alexander, to induce them to enter into a contract with EMCC for the purchase of a UNIVAC computer.
- During the demonstration, the storage system was operated, and Cannon and Alexander observed the memory effects achieved by the storage system.
- During the period of time in which EMCC was demonstrating the electrostatic information storage system, it was negotiating with the Bureau of Standards for additional contracts to develop a computer having an information storage system.
- The demonstration of the electrostatic information storage system for the commercial purpose of inducing Standards and Census officials to enter into a contract to develop a computer put the system on sale and in public use.
- On June 10, 1949, Eckert filed an application describing the electrostatic information storage system demonstrated during January, 1948, designated Case EM-8, that resulted in U.S. Patent No. 2,969,478 (the '478 Patent).
- On June 10, 1949, Eckert knew that subject matter claimed in the EM-8 application was embodied in the electrostatic information storage system demonstrated to the Bureau of Standards personnel during January, 1948.
- EMCC placed a binary adder claimed in the EM-14 application and patent in public use and on sale in the United States more than one year prior to the application filing date.
- By December 23, 1947, EMCC had built a demonstration model of a binary adder of the type described in a Report on the UNIVAC.
- The binary adder demonstration model also comprised a cycling unit in the form of a test word generator that generated pulses representing numbers for the binary adder to count.
- On or about December 23, 1947, Mauchly informed the Bureau of Standards that it was possible to demonstrate the binary adder model.
- During January, 1948, a large number of people from the U.S. Bureau of Census and the U.S. Bureau of Standards visited EMCC and observed demonstrations of the binary adder model.
- During March, 1948, the binary adder model was publicly demonstrated by EMCC to numerous persons at a convention of the Institute of Radio Engineers held in New York, New York.
- The purpose of the demonstration of the binary adder model was to interest the viewers in the purchase of the BINAC or UNIVAC computers then being developed by EMCC.
- The demonstrations of the binary adder model put the subject matter of the model in public use and on sale in the United States.
- On April 13, 1950, Eckert filed an application designated Case EM-14 that resulted in U.S. Patent No. 2, 687, 473 (the '473 Patent).
- The binary adder demonstration model included apparatus essentially the same as the apparatus described and claimed in the EM-14 application and patent.
- On April 13, 1950, Eckert knew that the binary adder model had been publicly demonstrated during March 1948, and that the test word generator of the adder was essentially the same as the apparatus described and claimed in the EM-14 application.
- EMCC placed the BINAC computer claimed in the EM-22 application in public use and on sale in the United States more than one year prior to the application filing date.
- During October 1947, Electronic Control Company, a partnership of Eckert and Mauchly and a predecessor of EMCC and SR, entered into a contract to manufacture and sell a BINAC computer system to Northrop Aircraft, Inc.
- The BINAC computer system consisted of two identical BINAC computers capable of simultaneous and independent operation upon the same problem in such a way that their reliability could be tested by direct comparison of their outputs.
- Beginning in late August, 1948, EMCC periodically offered BINAC computers for sale and demonstrated the Northrop BINAC computers to prospective customers, thereby putting subject matter embodied in each Northrop BINAC computer on sale and in public use in the United States.
- On or about August 12, 1948, the production of the first Northrop BINAC computer was complete.
- On or about September 9, 1948, the production of the second Northrop BINAC computer was complete.
- On September 10, 1948, Mauchly, president of EMCC, offered to sell to the University of Illinois a BINAV computer identical to the Northrop BINAC computers.
- Eckert was informed at the time about this offer to sell a BINAC computer to the University of Illinois.
- During November, 1948, a Northrop BINAC computer was demonstrated to representative of the U.S. Air Controllers Office and the Council of Economic Advisors to the President of the United States.
- During the spring of 1948, EMCC asked for and received permission from Northrop to demonstrate the Northrop BINAC computers to additional prospective customers.
- During the spring and summer of 1949, prior to August 16, 1949, the Northrop BINAC computers were demonstrated to many potential customers by EMCC for the purpose of selling computers.
- Prior to August 16, 1949, visitors at the EMCC plant viewed the same type of BINAC demonstrations later given to the press and invited guests at public administrations held during the third week of August, 1949.
- One of the demonstrations involved the solution of a Poisson equation which was a real and practical problem.
- Prior to August 14, 1949, the purpose of the BINAC demonstrations to visitors was to sell computers.
- During the BINAC demonstrations to visitors, the entire EMCC plant was used as "a gigantic salesroom."
- During the demonstrations, the engineers employed by EMCC cooperated with the attempts of management to sell computers.
- The engineers gave the potential customers any information that they wanted about the Northrop BINAC computers.
- During May, 1949, a Northrop BINAC computer was demonstrated to representatives of Hughes Aircraft Company in an attempt to sell Hughes a computer.
- During the week of June 12, 1949, the Northrop BINAC computer system was visited by R.A. Meagher of the University of Illinois.
- During July, 1949, a Northrop BINAC computer was demonstrated to representatives of Fairchild Engine and Aircraft Corporation in an attempt to sell Fairchild a computer.
- On or about July 27, 1949, a Northrop BINAC computer was demonstrated to representatives of A.C. Neilsen Company for commercial purposes.
- Prior to August 16, 1949, EMCC received $20,000 for demonstrating a Northrop BINAC computer to the Prudential Insurance Company of America (Prudential) and for making drawings and specifications of the BINAC computer available to Prudential.
- During December, 1948, EMCC agreed to sell a computer to Prudential on the condition that it be paid $20,000 for disclosing and demonstrating a binary computer to Prudential.
- In order to receive the $20,000 payment, EMCC made available to Prudential complete drawings of a Northrop BINAC computer.
- In order to receive the $20,000 payment, a Northrop BINAC computer was demonstrated to representatives of Prudential on July 29 and August 2, 1949.
- On or about August 3, 1949, EMCC received the $20,000 payment for disclosing and demonstrating a Northrop BINAC computer to Prudential in accordance with the December, 1948 Agreement.
- On August 16, 1950, Eckert and Mauchly filed U.S. Application Serial No. 179,782, still pending, designated Case EM-22, that purported to describe and claim one of the two identical Northrop BINAC computers.
- On August 16, 1950, Eckert and Mauchly knew that a BINAC computer had been offered for sale to the University of Illinois in September, 1948, and that the Northrop BINAC computers had been demonstrated to potential customers in the Eckert-Mauchly Computer Corporation plant salesroom on numerous occasions prior to August 16, 1949.
- EMCC placed a selecting network incorporated in the Northrop BINAC Computer System and described and claimed in the EM-20 application and patent on sale in the United States more than one year prior to the application filing date.
- On June 24, 1950, Eckert filed an application, designated Case EM-20, that resulted in the U.S. Patent No. 2,686,299.
- The EM-20 application described and claimed the encoding and decoding function tables used in the Northrop BINAC computers.
- On June 24, 1950, Eckert knew that the subject matter claimed in the EM-20 application covered equipment used in the Northrop BINAC computers and that a BINAC computer identical to the Northrop BINAC computers was offered for sale to the University of Illinois during September, 1948.
- EMCC placed a UNISERVO tape drive and recording device described and claimed in the EM-19 application and patent in public use and on sale in this country more than one year prior to the application filing date.
- EMCC entered into a Purchase Agreement with Prudential, dated December 8, 1948, for the sale of a UNIVAC system including 12 UNISERVO tape drive and recording devices.
- On May 5, 1949, representatives of Prudential witnessed a demonstration of the UNISERVO device at the EMCC plant and expressed satisfaction with the device.
- On or about May 5, 1949, Eckert was notified that the UNISERVO device had been successfully demonstrated to Prudential, and that EMCC would receive $20,000 for having completed the apparatus.
- On or about May 6, 1949, Prudential accepted a UNISERVO device as complying with Exhibit C of the December 8, 1948 Agreement and paid EMCC $20,000 for having completed the UNISERVO device, thereby placing the UNISERVO device on sale and in public use.
- On July 29, 1950, Eckert filed an application, designated Case EM-1, describing and claiming the UNISERVO device accepted by Prudential in May 1949.
- Preparations for the May 1949, UNISERVO demonstration received priority from EMCC, because completion of the demonstration would generate some income for the corporation.
- SR's predecessor placed a Census UNIVAC System described and claimed in the EM-39 — EM-44 and EM-48 applications and patents on sale and in public use in the United States more than one year prior to the application filing dates.
- During 1948, EMCC entered into an agreement to sell a UNIVAC System (hereinafter the Census UNIVAC System) to the U.S. Government for use by the U.S. Census Bureau; the Census UNIVAC System included a UNIVAC Computer, a UNIPRINTER, a UNITYPER, a CARD-TO-TAPE CONVERTER and other UNIVAC equipment.
- By February 2, 1951, the Census UNIVAC System was completely assembled and under test.
- Prior to March 28, 1951, the Census UNIVAC System was demonstrated to a continual flow of potential customers in the EMCC plant for the purposes of selling UNIVAC Systems.
- During the demonstrations, there was every intent to make the customers aware of the capabilities of the UNIVAC system and there were no orders for secrecy.
- Prior to March 28, 1951, Dr. Albert Auerbach programmed the Census UNIVAC System to solve a genetics problem which was run on the Census UNIVAC System as a demonstration for visitors; the program for solving the genetics problem was of the type actually used in genetics field work.
- Prior to March 15, 1951, SR's predecessor turned over the Census UNIVAC System to the U.S. Government for acceptance testing, thereby placing the system on sale.
- While the acceptance tests were being planned, the Census Bureau dealt with employee's of RR.
- There was general agreement between the U.S. Government and RR that passage of any acceptance test meant that the corresponding equipment became the property of the U.S. Government.
- UNIVAC System test A was passed March 15, 1951; the UNIPRINTER acceptance test was passed during the period of time from March 19 through March 25, 1951; the CARD-TO-TAPE Unit acceptance test was passed and the CARD-TO-TAPE unit was accepted for payment by at least March 27, 1951; UNIVAC System Test B was passed March 30, 1951, thereby completing the last of the acceptance tests.
- Beginning at least by March 20 or March 21, 1951, Census Bureau employees commenced work on actual Census tabulations using the Census UNIVAC System.
- On March 31, 1951, after all the acceptance tests had been passed, the Census Bureau employees just continued to do the same type of tabulations they had been doing before with the help, permission and assistance of employees of SR's predecessor.
- By turning the Census UNIVAC System over to the U.S. Government for acceptance testing, SR's predecessor put the system on sale.
- On March 28, 1952, Eckert filed an application describing the Census UNIVAC System Pulse Cycling Circuit, designated Case EM-43 that resulted in U.S. Patent No. 2,781,446.
- On March 31, 1952, Eckert filed application Serial No. 279,730 (EM-39), still pending, and other applications describing various portions of the Census UNIVAC System designated cases EM-40, EM-41, EM-42, EM-44 and EM-48, that resulted in U.S. Patent Nos. 2,860,756; 2,860,325; 3,133,190; 3,056,947; and 2,748,723.
- Subject matter claimed in each of these applications and patents was embodied in the Census UNIVAC System.
- On March 28 and March 31, 1952, Eckert was aware that the Census UNIVAC System had been sold to the U.S. Government under a contract executed in 1948, that the System had been turned over to the U.S. Government for acceptance testing by March 15, 1951, that the System had been used by Census Bureau employees to run census tabulations prior to March 28, 1951, and that the UNIPRINTER and CARD-TO-TAPE Units had been accepted for payment by the U.S. Government prior to March 28, 1951.
- The Census UNIVAC System was on sale and in public use in the United States prior to March 28, 1951.
- SR's predecessor placed a high-speed printer described and claimed in U.S. Patent Nos. 2,842,663; 2,915,966; and 2,938,193 on sale and in public use in the United States more than one year prior to June 10, 1955, the earliest filing date of the applications resulting in these patents.
- Prior to March 31, 1954, units of the high-speed printer were delivered for installation in customers' offices thereby putting the high-speed printer on sale and in public use.
- The high-speed printer claimed in U.S. Patent Nos. 2,842,663; 2,915,966; 2,938,193 was placed on sale and in public use prior to March 31, 1954.
- Subject matter claimed in the EM-1 patent was derived from Atanasoff.
- On October 31, 1947, Eckert and Mauchly filed an application describing various memory systems, designated case EM-1, that resulted in U.S. Patent No. 2,629,827 (the '827 patent).
- Subject matter claimed in the EM-1 application as the joint invention of Eckert and Mauchly was disclosed to Mauchly by Atanasoff in June of 1941.
- In one embodiment of the EM-1 application, information is stored in a coded sequence of pulses, the pulses being temporarily recorded on a rotating carrier as electrostatic charges, carried by rotation to another station where they give rise to electrical potential pulses which are handled through an external feedback circuit for replacement or reinforcement of the pulses on the carrier.
- This subject matter as claimed in the '827 patent was anticipated by the disclosure contained in the Atanasoff manuscript disclosed to Mauchly.
- Atanasoff's concept of the recirculating or regenerative memory was used in the EDVAC program, with Atanasoff's rotating electrostatic charge carrier being replaced by the recirculation of pulses through an electrical delay line; this delay line version of a recirculating memory was disclosed in the EM-1 application as an embodiment of Eckert and Mauchly's invention.
- The Atanasoff electrostatic charge version of a recirculating memory was also disclosed in the EM-1 application as yet another embodiment of Eckert and Mauchly's alleged invention.
- In October 1953, after the '827 patent was granted on the EM-1 application, Eckert stated that prior to 1942, Atanasoff has developed what was probably the first example of what could generally be termed regenerative memory; Eckert's knowledge of Atanasoff's prior work was based on what Mauchly had earlier told him.
- On April 1, 1964, SR charged Control Data Corporation with infringement of the '827 patent (EM-1).
- On February 2, 1965, SR charged Potter Instrument Company with infringement of the '827 patent (EM-1).
- SR also called the '827 patent (EM-1) to other computer manufacturers' attention, including Honeywell, as a part of its basic EDP patent portfolio.
- Incomplete Execution of the EM-14 and EM-22 Applications
- Albert Auerbach, an engineer formerly employed by EMCC, was misled by the legal department of SR's predecessor into signing the EM-14 oath of inventorship without being given an opportunity to determine what was claimed in the EM-14 application; Auerbach was not provided with the claims of the EM-14 application before he was asked to sign and did sign the EM-14 application oath; as of September 10, 1971, Auerbach had never seen the claims filed with the EM-14 application.
- Albert Auerbach and Wilson, another engineer formerly employed by EMCC, were misled by the legal department of SR's predecessor into signing the EM-22 oath of inventorship without being given an opportunity to determine what was claimed in the EM-22 application; neither Auerbach nor Wilson was provided with the claims of the EM-22 application before each was asked to and did sign the EM-22 application oath.
- Co-inventor omitted from the EM-43 patent.
- Part of the subject matter claimed in the EM-43 patent was invented by Paul Winsor who was not named therein and whom the Court finds to be a credible witness.
- Paul Winsor invented some of the apparatus described and claimed in the EM-43 patent.
- Paul Winsor invented the 27 Pulse Delay Line arrangement shown in Figures 5 and 13 of the EM-43 patent.
- In view of the statement by plaintiff that the court need not decide that any individual patent is invalid, I make no such finding of invalidity.
- Honeywell has stated that the Court need not decide that any of these 30A patents and applications is invalid.
- Accordingly, the Court expresses no opinion on the technical validity or invalidity of these 30A patents and applications and confines itself to the questions of unenforceability of the 30A patents issued and pending against Honeywell, and whether Honeywell has proven the Sherman Act violation based on alleged willful and intentional fraud on the Patent Office concerning these patent applications.
- I find disturbing the fact that with the rejection and abandonment of EM-27 based on the June 30, 1946 EDVAC Report the applicants or their counsel did not call this report to the attention of other examiners in Division 23.
- The EM-21, 23 and 25-29 patent applications all were prepared from the EDVAC Report by attorney Eltgroth who represented SR's predecessors.
- The earliest of the EM-21, 23 and 25-29 applications to be filed was not received by the Patent Office until October 21, 1950.
- The EM-27 and EM-28 applications were both assigned to Division 23 of the Patent Office for examination; the EM-21, 23, 25, 26 and 29 applications were assigned to Division 51 of the Patent Office for examination.
- Attorneys for SR's predecessors, Eltgroth and Light, handled all the prosecution of these applications.
- Through his own efforts, the EM-27 patent examiner in Division 23 uncovered the EDVAC Report and found that the EDVAC Report was a printed publication within the meaning of the patent statute prior to October 21, 1949, thereby barring patent protection for the EM-27 application.
- This finding of the EM-27 Examiner was agreed to by Light and was confirmed by information from RR's ERA subsidiary and from Libman; nonetheless, an amendment attempting to eliminate the report as reference was filed.
- A second examiner repeated the rejection, affirmed the finding that the EDVAC Report anticipated EM-27, and stated that the materials submitted with the amendment were "incomplete and consequently misleading"; no further action was taken and EM-27 was abandoned.
- After the critical nature of the EDVAC Report had been pointed out to them by the EM-27 examiner, Light and Eltgroth continued prosecution of the EM-23, 25, 26 and 29 applications which Eltgroth had based directly on the anticipatory EDVAC Report.
- The EM-21, 23, 25, 26 and 29 applications were handled by Examiners outside Division 23 who did not locate and cite the EDVAC Report against these applications; there is no evidence that these Examiners were aware of the EDVAC Report; neither Eltgroth nor Light informed such Examiners about the EDVAC Report or of the EM-27 Examiner's adverse ruling based on the EDVAC Report.
- When the EM-29 patent was drawn into an interference, Light and Elthgroth relied on the EDVAC Report to establish prior inventorship but withheld information which they had of the fact of the Report's publication.
- Light and Eltgroth relied on the EDVAC Report as proof of invention of EM-28, but withheld information about the fact of its publication and the EM-27 examiner's prior adverse ruling based on it; despite the reliance upon the EDVAC Report as a publication by the EM-27 Examiner, Light and Eltgroth submitted an affidavit to the EM-28 Examiner to antedate and avoid a prior art reference cited in the EM-28 case; in the affidavit in the respect, Eckert and Mauchly attempted to establish prior invention by relying on the drawing copied from the EDVAC Report; the EM-28 Examiner was never told, however, that the EDVAC Report had already been found to be a printed publication by the EM-27 Examiner in Division 23.
- Based on the affidavit, the EM-28 examiner withdrew his rejection and relied instead on another prior art reference (Moore School Lecture Series No. 46) as anticipating all claims of the EM-28 case; this was on June 16, 1953, and Eckert and Mauchly and RR then abandoned the EM-28 application.
- The published Moore School Lecture Series also anticipated cases EM-21, 25, and 26; yet, even after the fact of publication was established by the EM-28 Examiner, Eckert and Mauchly's attorneys continued to withhold knowledge of the Lecture Series from one Division 51 Examiner handling EM-25 and from another Division 51 Examiner handling EM-26.
- EM-21 had already issued when the EM-28 Examiner uncovered the published Lecture Series; however, neither Eckert nor Mauchly nor their successors have ever made any attempt to call the published Lecture Series to the attention of the Patent Office in connection with the EM-21 patent or to dedicate or disclaim the patent or any portion thereof.
- I find and conclude that as yet defendants have threatened no harm to plaintiff, that plaintiff has not proved injury, that plaintiff has failed to prove willful and intentional fraud on the Patent Office by clear and convincing evidence, and that plaintiff has failed to prove and illegal monopoly in restraint of trade.
- Honeywell has proven no actual or threatened injury to its business or property cause by any of the 30A patents and applications it has challenged.
- Defendants have not directly charged Honeywell with infringement of, or specifically demanded royalties on any of the 30A patents and applications.
- Honeywell offered no evidence that it tried to design around any SR patent or altered its conduct because of an SR patent or application. Honeywell has not admitted that it designed any of its EDP machines to avoid any of the claims of the 30A patents and applications.
- Honeywell has failed to prove willful and intentional fraud on the Patnet Office in connection with any of the 30A patents and applications.
- Findings 14.11-126.96.36.199 and 14.13-14.13.14 as to the infirmities in the 30A patents and applications and evidence tendered by Honeywell with respect to the SR-IBM August 21, 1956 cross-licensing and exchanging technical information which included the 30A patents and applications and which was an unreasonable restraint of trade in violation of Section 1 of the Sherman Act as found in 15.25 and 15.37 provide grounds for declaring the issued and pending 30A patents unenforceable.
- "It is not the mere obtaining of a fraudulent patent which brings antitrust liability to its owner; it is the assertion or enforcement of the issued patent acquired by fraud which creates antitrust liability.
- One who has not yet been charged with infringing a patent may have standing as private attorney general to seek a declaration that it is invalid or unenforceable as may necessary fit the exigencies.
- Honeywell has proven that SR violated Section 1 of the Sherman Act in connection with the August 21, 1956 Agreement with IBM which licensed the 30A patents and patent applications, but has not proven that any of these 30A patents or patent applications has injured Honeywell in its business or property.