A manufacturer failed to show a "substantial controversy" supporting a declaratory judgment action because the manufacturer did not take steps to perform the patented method and there was no evidence about the manufacturer’s customers' use of the manufacturer’s products to perform the patented methods.
A manufacturer of alkaline hydrolysis equipment for disposal of human remains brought a declaratory judgment action for non-infringement, invalidity, and unenforceability against a holder of method patents relating to alkaline hydrolysis waste disposal, who had asserted by phone, letter, and communications to the manufacturer’s customers that the sale and use of the manufacturer’s equipment would infringe on its method patents. The district court granted the patentee’s motion to dismiss, concluding that the constitutional requirements for declaratory judgment jurisdiction were lacking because the licensee’s equipment could be operated with parameters outside the methods specified in the patents.
The Federal Circuit affirmed the district court’s determination, holding that the manufacturer failed to show a "substantial controversy" that was "of sufficient immediacy and reality to warrant the issuance of a declaratory judgment." Specifically, the dispute lacked immediacy because the manufacturer did not practice any of the methods disclosed in the patents and had presented no evidence that its products would be used in a manner that could potentially infringe the patents. Any potential future infringement by the [manufacturer’s] customers was "too remote and speculative" to support a declaratory judgment action.
In addition, the dispute lacked sufficient reality because the manufacturer failed to provide information regarding the specific parameters under which its units would be operated, making it impossible to determine whether operation of the equipment could meet claim limitations in the patents. Rather than being "substantially fixed," the technology under dispute was "fluid and indeterminate," and any judicial determination as to whether the operation of the manufacturer’s products would infringe the patents "would constitute an advisory opinion based upon a hypothetical set of facts."
A copy of the opinion can be found here.