Lazare Kaplan International, Inc. v. Photoscribe Technologies, Inc. , 714 F.3d 1289 ( 2013 )

United States Court of Appeals
for the Federal Circuit
______________________
LAZARE KAPLAN INTERNATIONAL, INC.,
Plaintiff-Appellant,
v.
PHOTOSCRIBE TECHNOLOGIES, INC. AND
GEMOLOGICAL INSTITUTE OF AMERICA,
Defendants-Appellees.
______________________
2012-1247
______________________
Appeal from the United States District Court for the
Southern District of New York in No. 06-CV-4005, Judge
Thomas P. Griesa.
______________________
Decided: April 19, 2013
______________________
DEANNE E. MAYNARD, Morrison & Foerster, LLP, of
Washington, DC, argued for plaintiff-appellant. With her
on the brief were MARC A. HEARRON and NATALIE R. RAM;
HAROLD J. MCELHINNY, of San Francisco, California;
JAMES E. HOUGH, of New York, New York.
JOHN ALLCOCK, DLA Piper, LLP, of San Diego, Cali-
fornia, argued for defendants-appellees. With him on the
brief were NANCY O. DIX and STANLEY J. PANIKOWSKI. Of
counsel was JOHN DAVID KINTON.
2 LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC.
______________________
Before LOURIE, DYK, and REYNA, Circuit Judges.
Opinion for the court filed by Circuit Judge LOURIE.
Dissenting opinion filed by Circuit Judge DYK.
LOURIE, Circuit Judge.
Lazare Kaplan International, Inc. (“Lazare Kaplan”)
appeals from the order of the United States District Court
for the Southern District of New York granting summary
judgment of invalidity of claims 1 and 7 of U.S. Patent
6,476,351 (the “’351 patent”) and granting a motion under
Federal Rule of Civil Procedure 60(b) filed by Photoscribe
Technologies, Inc. and the Gemological Institute of Amer-
ica (collectively “Photoscribe”) seeking to vacate the
district court’s prior judgment finding the same claims not
invalid. Lazare Kaplan Int’l, Inc. v. Photoscribe Techs.,
Inc., No. 06 Civ. 4005 (TPG), 2012 WL 505742, at *14
(S.D.N.Y. Feb. 15, 2012) (“Lazare Kaplan IV”). Lazare
Kaplan requests that, if remanded, the case be reassigned
to a different judge. For the reasons set forth below, we
reverse the grant of relief under Rule 60(b), vacate the
finding of invalidity with instructions to reinstate the
original judgment of “not invalid,” and decline the request
to reassign.
BACKGROUND
Lazare Kaplan owns the ’351 patent, which claims
methods and systems for using lasers to make microin-
scriptions on gemstones. In 2006, Lazare Kaplan brought
suit for infringement of two patents, including the ’351
patent, against Photoscribe in the United States District
Court for the Southern District of New York. In response,
Photoscribe filed counterclaims seeking declarations of
invalidity.
LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC. 3
Only claims 1 and 7 of the ’351 patent are at issue in
this appeal. Claim 1 recites a method of microinscribing a
gemstone, with the final limitation requiring “controlling
the directing of the focused laser energy based on the
marking instructions and the imaging, to selectively
generate a marking on the gemstone based on the instruc-
tions.” ’351 patent col.26 ll.62–65. Claim 7 recites a
corresponding system claim with a similar final limita-
tion. See id. col.27 ll.17–35. The district court construed
these “controlling the directing” limitations in claims 1
and 7 as follows: “controlling is based on the marking
instructions generated by the operator of the machine,
and automatic feedback derived from optical images of the
gemstone during the laser burn process.” Lazare Kaplan
Int’l, Inc. v. Photoscribe Techs., Inc., No. 06 Civ. 4005
(TPG), 2008 WL 355605, at *1 (S.D.N.Y. Feb. 5, 2008)
(“Lazare Kaplan I”). Finding that the accused machines
did not use automatic feedback derived during the laser
burn process, the district court granted summary judg-
ment of no literal infringement of claims 1 and 7. Id. The
district court found that disputed issues of fact precluded
summary judgment of infringement under the doctrine of
equivalents. Id.
After a trial held in 2008, the jury returned a verdict
that Photoscribe did not infringe claims 1 or 7 under the
doctrine of equivalents. Lazare Kaplan Int’l, Inc. v.
Photoscribe Techs., Inc., No. 06 Civ. 4005 (TPG), slip op.
at 3 (S.D.N.Y. Jan. 22, 2009) (“Lazare Kaplan II”). The
district court then issued a final judgment that claims 1
and 7 were not invalid and not infringed, either literally
or under the doctrine of equivalents. Id. at 4 ¶¶ 1, 2, 5.
Lazare Kaplan filed a notice of appeal from the judgment
of noninfringement. Photoscribe, however, did not file a
notice of appeal from the judgment that the asserted
claims were not invalid.
In that prior appeal, we broadened the district court’s
construction of the “controlling the directing” limitations,
4 LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC.
finding that those limitations “include control based on
either automated or manual feedback derived from optical
images of a gemstone, before or during the laser burn
process.” Lazare Kaplan Int’l, Inc. v. Photoscribe Techs.,
Inc., 628 F.3d 1359, 1369 (Fed. Cir. 2010) (“Lazare Kaplan
III”). We vacated both the grant of summary judgment of
no literal infringement and the jury verdict of nonin-
fringement under the doctrine of equivalents, as both
were based on the district court’s erroneous construction.
Id. at 1370. In addition, we explicitly remanded the issue
of infringement to the district court because we could not
“determine with any certainty that the accused machines
infringe the asserted claims under this new construction.”
Id.
On remand, the district court held a case manage-
ment conference, in which Lazare Kaplan argued that
only infringement should be retried, not validity. Lazare
Kaplan IV, 2012 WL 505742, at *4. Photoscribe respond-
ed that both infringement and validity were at issue
because of the broadened claim construction. Id. The
district court agreed with Photoscribe, stating, “we are
going to retry it on validity, because the validity decision
of the jury in the first trial was on the basis of a claim
construction which the Court of Appeals has reversed.”
Id. The court stated that it “makes no sense” to do other-
wise. Id. Photoscribe later moved for summary judgment
of invalidity of claims 1 and 7, while Lazare Kaplan
moved for summary judgment of infringement. Id. at *1.
Photoscribe also moved under Rule 60(b) for relief from
the district court’s prior judgment, in Lazare Kaplan II,
finding the claims not invalid. Id. The district court
granted both of Photoscribe’s motions and denied Lazare
Kaplan’s motion as moot. Id. at *14.
Lazare Kaplan timely appealed from the district
court’s rulings. We have jurisdiction under 28 U.S.C. §
1295(a)(1).
LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC. 5
DISCUSSION
I. REOPENING VALIDITY IN THE PRIOR REMAND
When reviewing a ruling under Rule 60(b), 1 we gener-
ally defer to the law of the regional circuit in which the
district court sits, here the Second Circuit, because that
rule is procedural in nature and not unique to patent law.
See, e.g., Louisville Bedding Co. v. Pillowtex Corp., 455
F.3d 1377, 1379–81 (Fed. Cir. 2006) (applying Sixth
Circuit law to review a ruling on a Rule 60(b) motion);
Univ. of W. Va., Bd. of Trs. v. VanVoorhies, 342 F.3d 1290,
1294 (Fed. Cir. 2003) (applying Fourth Circuit law); Engel
Indus., Inc. v. Lockformer Co., 166 F.3d 1379, 1384 (Fed.
Cir. 1999) (applying Eighth Circuit law); Amstar Corp. v.
Envirotech Corp., 823 F.2d 1538, 1550 (Fed. Cir. 1987)
(applying Tenth Circuit law). We do not accord such
deference, however, when a district court’s ruling under
Rule 60(b) turns on substantive issues unique to patent
law. See, e.g., Fiskars, Inc. v. Hunt Mfg. Co., 279 F.3d
1378, 1381 (Fed. Cir. 2002) (“[T]he issue before us—
whether a lost profits damages award should be set aside
because post-trial sales data may show the acceptability
of a non-infringing alternative product—turns on a sub-
stantive area of patent law.”); Broyhill Furniture Indus.,
Inc. v. Craftmaster Furniture Corp., 12 F.3d 1080, 1083
(Fed. Cir. 1993) (“The issues before us are whether a
consent judgment enjoining infringement of a patent
should be set aside pursuant to certain subsections of
Rule 60(b) following a judicial determination that the
1 Rule 60(b) provides, in relevant part, as follows:
“On motion and just terms, the court may relieve a party
or its legal representative from a final judgment, order, or
proceeding for the following reasons: . . . (5) the judgment
. . . is based on an earlier judgment that has been re-
versed or vacated . . . ; or (6) any other reason that justi-
fies relief.”
6 LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC.
patent was procured through inequitable conduct in the
[U.S. Patent and Trademark Office].”).
Here, the issue is whether, on remand, a district court
may reopen a prior final judgment as to patent validity,
not appealed by either party, based on a claim construc-
tion modified by this court. Because this issue requires
consistent and uniform application by district courts when
handling patent cases, we resolve it as an issue of the law
of this court. Fiskars, 279 F.3d at 1381; Broyhill, 12 F.3d
at 1083. We find persuasive, however, certain decisions of
our sister circuits, particularly the Second Circuit, on
issues relevant to this appeal. Broyhill, 12 F.3d at 1083
n.1.
We review a district court’s ruling under Rule 60(b)
for an abuse of discretion. Browder v. Dir., Ill. Dept. of
Corrections, 434 U.S. 257, 263 n.7 (1978). An abuse of
discretion exists “when the trial court’s decision is clearly
unreasonable, arbitrary or fanciful, or is based on clearly
erroneous findings of fact or erroneous conclusions of
law.” Fiskars, 279 F.3d at 1382 (citing Cybor Corp. v.
FAS Techs., Inc., 138 F.3d 1448, 1460 (Fed. Cir. 1998) (en
banc)).
It is well-settled that a party must file a cross-appeal
if, although successful in the overall outcome in the
district court, the party seeks, on appeal, to lessen the
rights of its adversary or to enlarge its own rights. El
Paso Natural Gas Co. v. Neztsosie, 526 U.S. 473, 479
(1999) (“Absent a cross-appeal, an appellee . . . may not
‘attack the decree with a view either to enlarging his own
rights thereunder or of lessening the rights of his adver-
sary.’”) (quoting United States v. Am. Ry. Express Co., 265
U.S. 425, 435 (1924)); see also Bailey v. Dart Container
Corp. of Mich., 292 F.3d 1360, 1362 (Fed. Cir. 2002) (“It is
only necessary and appropriate to file a cross-appeal
when a party seeks to enlarge its own rights under the
judgment or to lessen the rights of its adversary under the
LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC. 7
judgment.”). The Supreme Court has long recognized this
cross-appeal rule as “inveterate and certain,” Morley
Constr. Co v. Md. Cas. Co., 300 U.S. 185, 191 (1937), and
the rule’s application has been noted since the Court’s
earliest years, McDonough v. Dannery, 3 U.S. 188, 198
(1796). See Greenlaw v. United States, 554 U.S. 237, 244–
45 (2008); El Paso, 526 U.S. at 479. Application of the
rule promotes orderly functioning of the appellate courts
by providing “notice of issues to be litigated and encourag-
ing repose of those that are not.” El Paso, 526 U.S. at
481–82.
Not long after the creation of this court, we clarified
the application of the cross-appeal rule in Radio Steel &
Manufacturing Co. v. MTD Products, Inc., 731 F.2d 840(Fed. Cir. 1984). In that case, the district court found the
asserted claims not invalid and not infringed, with the
patent owner appealing from the judgment of nonin-
fringement, but with the alleged infringer taking no cross-
appeal. Radio Steel, 731 F.2d at 842–43. Acknowledging
lack of uniformity in the prior practice of the regional
circuits on whether a cross-appeal must be filed by a
similarly situated alleged infringer arguing invalidity, we
set forth our current rule: “[A] party will not be permitted
to argue before us an issue on which it has lost and on
which it has not appealed, where the result of acceptance
of its argument would be reversal or modification of the
judgment rather than affirmance.” Id. at 844.
More recently, we applied the cross-appeal rule in
Odetics, Inc. v. Storage Technology Corp., 185 F.3d 1259(Fed. Cir. 1999). Prior to the first of two appeals in that
litigation, the district court entered judgment that the
asserted claims were not invalid and not infringed.
Odetics, Inc. v. Storage Tech. Corp., Nos. 96-1261, -1301,
1997 WL 357598, at *2 (Fed. Cir. June 25, 1997). In the
first appeal, we broadened the construction of a claim
term and remanded to assess infringement under the new
construction. Id. at *5, *7. Because the alleged infringer
8 LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC.
had failed to file a cross-appeal, we declined to address
certain invalidity arguments. Id. at *6 (citing Radio
Steel, 731 F.2d at 844). Following remand, in which the
district court found the invalidity arguments barred, the
alleged infringer filed a cross-appeal. Odetics, 185 F.3d at
1263. In the second appeal, we affirmed the district
court’s decision not to address invalidity, finding that, by
failing to file a cross-appeal from the distinct judgment of
“not invalid” after the first trial, the alleged infringer was
precluded from further raising the issue. Id. at 1275.
In both Odetics and Radio Steel, we highlighted the
distinctness of the judgments of “not infringed” and “not
invalid.” Odetics, 185 F.3d at 1275; Radio Steel, 731 F.2d
at 843. Here, the district court found that “[i]n this case,
the issues of invalidity and infringement cannot be said to
be distinct; they are closely interrelated.” Lazare Kaplan
IV, 2012 WL 505742, at *9. The district court concluded
that, because the issues of validity and infringement
“cannot be said to be distinct, it was not necessary for
defendants to appeal the validity issue in order for the
court to hear the issue on remand.” Id. Based on that
reasoning, the district court granted relief under Rule
60(b).
Lazare Kaplan argues that the cross-appeal rule
should have barred reopening the prior judgment on
validity because Photoscribe seeks to lessen the rights of
Lazare Kaplan under that prior judgment but failed to file
a cross-appeal. In addition, Lazare Kaplan asserts that
the cross-appeal rule has no equitable exceptions permit-
ting the relief granted by the district court. Photoscribe
responds that prior decisions of this court permitted the
district court to address validity on remand. Further,
Photoscribe asserts that the granted relief was proper
under either Rule 60(b)(5) or 60(b)(6).
We agree with Lazare Kaplan and conclude that the
district court erred by allowing Photoscribe to address
LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC. 9
validity on remand despite its failure to file a cross-appeal
from the adverse final judgment on validity in Lazare
Kaplan II.
The cross-appeal rule is normally applied not by
district courts, but by appellate courts to assess the
availability of arguments before those tribunals. See, e.g.,
El Paso, 526 U.S. at 479–82. To the extent that the cross-
appeal rule can be applied to preclude certain arguments
in a district court on remand after a failure to file a cross-
appeal, however, we find the district court’s application to
be in error. Whether or not the concepts of invalidity and
infringement are “closely interrelated” is irrelevant; the
relevant issue is whether a ruling reversing the validity
holding would expand Photoscribe’s rights or lessen
Lazare Kaplan’s rights. It certainly would, as a holding of
invalidity would extend beyond the determination that
Photoscribe’s accused machines do not infringe the as-
serted claims of the ’351 patent. Indeed, no accused
products can be found liable for infringement of an invalid
claim. See Medtronic, Inc. v. Cardiac Pacemakers, Inc.,
721 F.2d 1563, 1583 (Fed. Cir. 1983) (“[A]n invalid claim
cannot give rise to liability for infringement . . . .”).
Both before the district court and in this appeal,
Photoscribe has sought relief under Rule 60(b)(5) and
60(b)(6), although the district court did not specify which
section of Rule 60(b) provided the basis for its ruling.
Lazare Kaplan IV, 2012 WL 505742, at *8–9.
The Second Circuit has stated that “Rule 60 of the
Federal Rules of Civil Procedure prescribes procedures by
which a party may seek relief from a final judgment.”
House v. Sec’y of Health & Human Servs., 688 F.2d 7, 9
(2d Cir. 1982). Rule 60(b)(5) provides, in relevant part,
that a district court “may relieve a party . . . from a final
judgment, order, or proceeding” that “is based on an
earlier judgment that has been reversed or vacated.”
Under Rule 60(b)(6), a district court may relieve a party
10 LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC.
from a final judgment for “any other reason that justifies
relief.” The Second Circuit has characterized Rule
60(b)(6) as a “grand reservoir of equitable power to do
justice in a particular case,” but cautioned that the “res-
ervoir is not bottomless.” Stevens v. Miller, 676 F.3d 62,
67 (2d Cir. 2012). Relief under this provision has long
been limited to “extraordinary circumstances.” Acker-
mann v. United States, 340 U.S. 193, 199 (1950); see also
CTS Corp. v. Piher Int’l Corp., 727 F.2d 1550, 1555 (Fed.
Cir. 1984) (“Unless exceptional or extraordinary circum-
stances are shown, a Rule 60(b)(6) motion is generally not
granted.”).
Under the facts presented here, we conclude that Rule
60(b) cannot provide the relief granted by the district
court. As the language of the rule indicates, any relief
provided by a district court is discretionary. See Fed. R.
Civ. P. 60(b) (“On motion and just terms, the court may
relieve a party or its legal representative from a final
judgment, order, or proceeding for the following reasons . .
. .”) (emphasis added); see also Stevens, 676 F.3d at 67
(“The decision whether to grant a party’s Rule 60(b)
motion is committed to the ‘sound discretion’ of the dis-
trict court.”). Both the cross-appeal rule and Rule 60(b),
however, share a common underlying rationale of promot-
ing repose. See El Paso, 526 U.S. at 481–82 (noting that
the cross-appeal rule puts “opposing parties and appellate
courts on notice of the issues to be litigated and encour-
ag[es] repose of those that are not”); House, 688 F.2d at 9
(“Properly applied, [Rule 60(b)] preserves a balance
between serving the ends of justice and ensuring that
litigation reaches an end within a finite period of time.”).
When the potential outcomes of applying Rule 60(b)
and the cross-appeal rule conflict, failure to steadfastly
apply the cross-appeal rule invites unjustified relief under
Rule 60(b), thereby undermining the common repose
rationale underlying both of those rules. Moreover, it
would allow a movant to circumvent the cross-appeal rule
LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC. 11
in a manner contrary to its well-established history. See
El Paso, 526 U.S. at 480 (“[I]n more than two centuries of
repeatedly endorsing the cross-appeal requirement, not a
single one of our holdings has ever recognized an excep-
tion to the rule.”).
Photoscribe does not argue that any factors precluded
it from appealing from the adverse judgment on validity
in Lazare Kaplan II. Instead, Photoscribe asserts that the
possibility that a different claim construction could be
applied to assessing validity and infringement inherently
presents an “extraordinary circumstance.” Appellee Br.
22. The cases cited by Photoscribe, however, do not
involve Rule 60(b)(6), and only recite the familiar axiom
that “claims are construed the same way for both invalidi-
ty and infringement.” Id. at 21 (quoting Amgen Inc. v.
Hoechst Marion Roussel, Inc., 314 F.3d 1313, 1330 (Fed.
Cir. 2003)). That axiom, however, does not trump the
Federal Rules or the cross-appeal rule, and cannot save
Photoscribe from its deliberate decision not to file a cross-
appeal from an adverse judgment. See El Paso, 526 U.S.
at 480. Moreover, reversal of a claim construction is
hardly an “extraordinary circumstance.”
In similar situations, in which a movant under Rule
60(b)(6) made a deliberate choice not to appeal or to
pursue a particular litigation strategy, courts have found
relief unwarranted. For example, in Ackermann v. United
States, 340 U.S. 193, 194–95 (1950), the Supreme Court
addressed whether the Fifth Circuit properly affirmed
denial of the Ackermanns’ motion under Rule 60(b)(6)
seeking to vacate a district court’s judgment cancelling
their certificates of naturalization. After entry of judg-
ment, a co-defendant appealed while the Ackermanns did
not. Id. at 195. The Fifth Circuit reversed the judgment
against the co-defendant, and the Ackermanns sought
relief. Id. The Supreme Court affirmed the denial of
relief, noting that Ackermann “made a considered choice
not to appeal” and that he “cannot be relieved of such a
12 LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC.
choice because hindsight seems to indicate to him that his
decision not to appeal was probably wrong.” Id. at 198;
see also Cruickshank & Co. v. Dutchess Shipping Co., 805
F.2d 465, 468 (2d Cir. 1986) (“Failure to properly assess
the risks and potential gains of taking an appeal is not an
extraordinary circumstance that would justify relief under
rule 60(b)(6).”); House, 688 F.2d at 10 (noting that revers-
ing the grant of relief under Rule 60(b)(6) was “particular-
ly appropriate” where the movant could have appealed
but did not); Rinieri v. News Syndicate Co., 385 F.2d 818,
823 (2d Cir. 1967) (reversing the grant of relief under
Rule 60(b)(6) where the movant chose not to appeal or
present reasons for not prosecuting his prior claim);
Whiteleather v. United States, 264 F.2d 861, 863 (6th Cir.
1959) (“Rule 60(b)(6) . . . has no application to a case such
as this, where a defendant is represented by counsel, is
not deprived of the opportunity of appealing from an
adverse judgment, and voluntarily for reasons of his own
elects not to appeal.”); see also Fiskars, 279 F.3d at 1383
(finding Rule 60(b)(6) did not apply, in part, because the
alleged infringer could have put on its best available
evidence of noninfringing alternatives but “apparently
chose not to do so”).
Photoscribe asserts that two decisions of this court
support the requested relief, aside from the application of
Rule 60(b). See Cardiac Pacemakers, Inc. v. St. Jude
Med., Inc., 576 F.3d 1348, 1355–57 (Fed. Cir. 2009) (en
banc); Exxon Chem. Patents, Inc. v. Lubrizol Corp., 137
F.3d 1475, 1477–79 (Fed. Cir. 1998). We disagree. Both
of those decisions involve the mandate rule—a concept
relating to, but distinct from, the cross-appeal rule. The
mandate rule dictates that “an appellate mandate governs
only that which was actually decided.” Exxon, 137 F.3d at
1478. Photoscribe seeks to broaden this rule in arguing
that, because we did not address validity in Lazare
Kaplan III, that issue must have been eligible for review
on remand. That interpretation, however, would enable
LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC. 13
appellees to revive any issue not addressed in an appel-
late decision, thereby rendering nugatory the cross-appeal
rule. Indeed, here, the reason validity was not addressed
in Lazare Kaplan III was that Photoscribe failed to file a
cross-appeal from the judgment adverse to it. For these
reasons, we see no conflict between the decisions concern-
ing the mandate rule relied on by Photoscribe and those
concerning the cross-appeal rule discussed above.
In addition, Photoscribe asserts that it should be
excused from failing to appeal because it could not have
known the issues to raise in a cross-appeal. Photoscribe
acknowledges, however, the importance of the “controlling
the directing” limitations to both infringement and validi-
ty. Claim construction is crucial to any analysis of validi-
ty over prior art. Photoscribe admits that “the sole basis
of [Lazare Kaplan’s] challenge to the noninfringement
judgment was the construction of ‘controlling the direct-
ing.’” Appellee Br. 17–18. Photoscribe also admitted that
those limitations were “the only disputed claim element
for anticipation” by one of the alleged prior art machines.
Id. at 18–19. In addition, the district court’s construction
of those limitations provided the sole basis for summary
judgment of no literal infringement. Lazare Kaplan I,
2008 WL 355605, at *1. With such focus on those limita-
tions, the issues relevant to Lazare Kaplan’s then-
upcoming appeal—and any cross-appeal potentially filed
by Photoscribe—were apparent. After Lazare Kaplan II,
Photoscribe could have filed a conditional cross-appeal
arguing that the asserted claims of the ’351 patent would
be invalid if we broadened the construction of the “control-
ling the directing” limitations. The outcome of the claim
construction issues would have determined whether that
conditional cross-appeal was reached. See Power Mosfet
Techs., Inc. v. Siemens AG, 378 F.3d 1396, 1414 n.3 (Fed.
Cir. 2004).
We recognize the logic of the district court’s decision
to entertain the validity challenge on remand in light of
14 LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC.
the broadened claim construction by this court, based on
which the district court stated that it “makes no sense”
not to. Lazare Kaplan IV, 2012 WL 505742, at *4. After
all, a new claim construction potentially raises new
validity issues. Nonetheless, rules are rules, and the
cross-appeal rule is firmly established in our law. The
district court thus erred in relying on Rule 60(b) as a
substitute for a cross-appeal. See Stevens, 676 F.3d at 67
(“In no circumstances . . . may a party use a Rule 60(b)
motion as a substitute for an appeal it failed to take in a
timely fashion.”); see also Cruickshank, 805 F.2d at 468
(“Having failed to appeal, movants cannot achieve the
same result under the guise of a rule 60(b)(5) motion.”);
Rinieri, 385 F.2d at 822 (“[Rule 60(b)(6)] is not to be used
as a substitute for appeal when appeal would have been
proper . . . .”); 11 Charles A. Wright et al., Federal Prac-
tice and Procedure § 2851 (3d ed. 1998).
Because the district court abused its discretion by
granting relief under Rule 60(b), we reverse that ruling.
We also vacate the finding of invalidity, and remand with
instructions to reinstate the original judgment on validity.
II. PENDING ISSUES ON REMAND
Lazare Kaplan requests this court to enter judgment
on the issue of infringement. We cannot do so. See Gold-
en Bridge Tech., Inc. v. Nokia, Inc., 527 F.3d 1318, 1323
(Fed. Cir. 2008) (“Appellate courts review district court
judgments; we do not find facts.”). In Lazare Kaplan III,
we instructed the district court to assess infringement on
remand because “we cannot determine with any certainty
that the accused machines infringe the asserted claims
under this new construction.” Lazare Kaplan III, 628
F.3d at 1370. On remand, the district court made no
findings of fact as to infringement under the revised
construction and instead dismissed Lazare Kaplan’s
motion for summary judgment of infringement as moot.
Lazare Kaplan IV, 2012 WL 505742, at *14. On this
LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC. 15
second remand, we again instruct the district court to
assess infringement under the construction we set forth in
Lazare Kaplan III.
III. REASSIGNMENT
Lazare Kaplan asserts that, if remanded, this case
should be reassigned to a different judge in the district
court. We evaluate such requests under the law of the
regional circuit in which the district court sits. Micro
Chem., Inc. v. Lextron, Inc., 318 F.3d 1119, 1122 (Fed. Cir.
2003). When assessing a request for reassignment, the
Second Circuit considers three factors: “(1) whether the
original judge would reasonably be expected upon remand
to have substantial difficulty in putting out of his or her
mind previously-expressed views or findings determined
to be erroneous or based on evidence that must be reject-
ed, (2) whether reassignment is advisable to preserve the
appearance of justice, and (3) whether reassignment
would entail waste and duplication out of proportion to
any gain in preserving the appearance of fairness.”
Shcherbakovskiy v. Da Capo Al Fine, Ltd., 490 F.3d 130,
142 (2d Cir. 2007).
As to the first factor, Lazare Kaplan has only raised
alleged improprieties that relate to either the enforceabil-
ity or validity of the ’351 patent. Appellant Br. 51–53.
Those issues, however, will not be addressed on remand,
and Lazare Kaplan has not shown that any statements
relating to those issues indicate that the district judge
will have difficulty assessing the narrow aspects of this
litigation now remanded. Lazare Kaplan does not address
the second factor. On the record before us, however, we
do not perceive circumstances that “might reasonably
cause an objective observer to question [the judge’s]
impartiality.” Vincent v. Comm’r of Soc. Sec., 651 F.3d
299, 308 (2d Cir. 2011) (alteration in original). Finally,
we believe that preservation of judicial resources favors
denying the reassignment request, especially given the
16 LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC.
narrow scope of the remand—to assess infringement and,
if necessary, damages. The district judge already has
intimate knowledge of the accused machines and the
technology at issue. On this second remand, he should
apply that knowledge to address the infringement issues
still undecided in this litigation.
CONCLUSION
For the reasons set forth above, we reverse the dis-
trict court’s grant of relief under Rule 60(b) and vacate
the finding of invalidity on summary judgment. On
remand, the district court is instructed to reinstate its
original judgment on validity, assess infringement, and, if
necessary, determine damages. The judgment of the
district court is therefore
REVERSED IN PART, VACATED IN PART, AND
REMANDED.
United States Court of Appeals
for the Federal Circuit
______________________
LAZARE KAPLAN INTERNATIONAL, INC.,
Plaintiff-Appellant,
v.
PHOTOSCRIBE TECHNOLOGIES, INC. AND
GEMOLOGICAL INSTITUTE OF AMERICA,
Defendants-Appellees.
______________________
2012-1247
______________________
Appeal from the United States District Court for the
Southern District of New York in No. 06-CV-4005, Judge
Thomas P. Griesa.
______________________
DYK, Circuit Judge, dissenting.
No principle of patent law is better established than
that “claims must be interpreted and given the same
meaning for purposes of both validity and infringement
analyses.” Amazon.com, Inc. v. Barnesandnoble.com, Inc.,
239 F.3d 1343, 1351 (Fed. Cir. 2001). Here the majority
declines to enforce that basic stricture, allowing the
patentee to assert infringement on a broad claim con-
struction while permitting it to defend against invalidity
using a different and far narrower claim construction.
The majority reverses the district court’s effort to elimi-
2 LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC.
nate this inconsistency through Federal Rule of Civil
Procedure 60(b)(5). I respectfully dissent.
I
The relevant facts are undisputed. In defending
against an invalidity challenge in the district court, the
patentee, Lazare Kaplan International, Inc. (“Lazare”),
successfully relied on the construction of the term “con-
trolling the directing . . . based on . . . the imaging.” U.S.
Patent No. 6,476,351, col.26 ll.62-63; see Lazare Kaplan
Int’l, Inc. v. Photoscribe Techs., Inc., 2012 WL 505742, at
*3 (S.D.N.Y. Feb. 15, 2012). The district court had inter-
preted that claim language narrowly, requiring “automat-
ic feedback derived from optical images of the gemstone
during the laser burn process.” Lazare, 2012 WL 505742,
at *3. Based on that narrow claim construction, a jury
found that the accused infringers, Photoscribe Technolo-
gies, Inc. and the Gemological Institute of America (collec-
tively “Photoscribe”), had not proven the pertinent claims
invalid. Id. Based on the same narrow claim construc-
tion, the district court, on summary judgment, found that
there was no literal infringement. Id. Relying on the
same claim construction, a jury found no infringement
under the doctrine of equivalents. Id.
Lazare appealed to this court, urging a broader claim
construction which also encompassed manual feedback.
Lazare Kaplan Int’l, Inc. v. Photoscribe Techs., Inc., 628
F.3d 1359, 1367 (Fed. Cir. 2010). Photoscribe did not
appeal from the invalidity determination because it
agreed with the district court’s narrow claim construction
(which resulted in a finding of noninfringement) and
supported the district court’s judgment in full. We agreed
with Lazare and vacated the noninfringement judgment,
remanding for further proceedings on the issue of in-
fringement under the correct claim construction. See id.
at 1370.
LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC. 3
II
This court’s mandate in the first appeal did not reo-
pen the issue of invalidity since invalidity had not been
addressed on appeal. See Odetics, Inc. v. Storage Tech.
Corp., 185 F.3d 1259, 1275 (Fed. Cir. 1999).
However, the Supreme Court has held that an appel-
late mandate generally does not constrain a district
court’s power under Rule 60(b). See Standard Oil Co. of
Cal. v. United States, 429 U.S. 17, 18–19 (1976) (holding
that a party need not obtain leave from an appellate court
prior to filing a Rule 60(b) motion in the district court).
Here, Photoscribe sought to reconcile the two inconsistent
judgments on invalidity and infringement using Rule
60(b). 1
1 Rule 60(b) provides:
On motion and just terms, the court may re-
lieve a party . . . from a final judgment . . . for the
following reasons:
...
(5) the judgment . . . is based on an earlier
judgment that has been reversed or vacated . . . .
Fed. R. Civ. P. 60(b)(5). Moreover, Rule 60(b)(5) per-
mits relief from a judgment when “applying it prospec-
tively is no longer equitable.” Id. That latter portion of
the rule also appears to allow relief from a judgment
where circumstances have changed such that continued
application of the judgment would be inequitable. See,
e.g., Theriault v. Smith, 523 F.2d 601, 601–02 (1st Cir.
1975) (finding Rule 60(b)(5) relief appropriate because an
intervening Supreme Court decision “represented a
fundamental change in the legal predicates of the consent
decree”).
4 LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC.
The majority’s sole reason for finding Rule 60(b) relief
unavailable is the well-established rule that Rule 60(b)
cannot be used as a substitute for an appeal. See, e.g.,
Cruickshank & Co. v. Dutchess Shipping Co., 805 F.2d
465, 468 (2d Cir. 1986) (finding “no merit” to a Rule 60(b)
motion where the movant failed to appeal and sought to
use the Rule 60(b) vehicle to advance previously-litigated
claims on “the same facts” that had already been before
the district court). The majority appears to hold that the
accused infringer cannot secure Rule 60(b) relief because
it is attempting to use Rule 60(b) as a substitute for a
contingent cross-appeal. But the majority identifies no
case holding that a failure to file a contingent cross-appeal
bars Rule 60(b) relief. Rather, the cases cited by the
majority involved situations in which the Rule 60(b)
movant had lost entirely and failed to appeal. E.g.,
Cruickshank, 805 F.2d at 466–67 (movant had lost on a
default judgment, failed to appeal, and sought relief
under Rule 60(b) only after a co-defendant prevailed on a
related appeal); Rineri v. News Syndicate Co., 385 F.2d
818, 820 (2d Cir. 1967) (movant’s complaint was dis-
missed for lack of prosecution and movant sought to
reinstate the original action on the merits). Here, in
contrast, Photoscribe never objected to the district court’s
claim construction or judgment in any respect. It was
only after this court altered the district court’s original
judgment that the accused infringer had any objection.
This is thus not a situation governed by the tradition-
al “cross-appeal rule”—that is, the rule that “a party must
file a cross-appeal if . . . [it] seeks, on appeal, to lessen the
rights of its adversary or to enlarge its own rights.” Maj.
Op. 6 (citing El Paso Natural Gas Co. v. Neztsosie, 526
U.S. 473, 479 (1999)) (emphasis added). Here, Pho-
toscribe sought on appeal not to modify the rights estab-
lished by the district court judgment but to preserve
them.
LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC. 5
In such circumstances, there is no requirement that a
party file a conditional cross-appeal. See United States v.
Bohn, 959 F.2d 389, 393–94 (2d Cir. 1992) (“We conclude
that a conditional cross-appeal is not required . . . to
permit us to entertain a Government request to augment
one component of a sentence on one count in response to
an appellate ruling decreasing another component.”);
Dalle-Tezze v. Dir., Office of Workers’ Comp. Programs,
U.S. Dep’t of Labor, 814 F.2d 129, 133 (3d Cir. 1987)
(noting that “the policy underlying [the cross-appeal] rule”
does not require “that a party who is satisfied with the
judgment below . . . appeal from it, even if his adversary
does pursue an appeal”); see also 15A Charles Alan
Wright & Arthur R. Miller, Federal Practice and Proce-
dure § 3904 (3d ed. 2004) (“Cross-appeal also is not re-
quired to preserve the right to orderly disposition of
issues that become relevant only because of reversal.”).
As the Second Circuit noted in Bohn:
[r]equiring conditional cross-appeals . . . would
oblige [parties] to file conditional cross-appeals re-
flexively, anticipating all possible appellate ad-
justments of the [judgment] in advance of
knowing precisely the nature of the appellant’s
challenge. That would burden appellees (and
courts) with no appreciable benefit to appellate
practice.
Bohn, 959 F.2d at 394.
The Supreme Court’s decision in Bowen v. United
States Postal Service, 459 U.S. 212 (1983), is almost
directly on point. Bowen involved an action by a former
Postal Service employee against both the Service and the
American Postal Workers Union, to which the employee
had belonged during his employment. 459 U.S. at 214. A
jury found the Service had wrongfully discharged Bowen
and that the Union had breached its duty of fair represen-
tation. Id. at 214–215. In accordance with the jury’s
6 LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC.
special verdict, the district court apportioned $30,000 of
Bowen’s damages to the Union and the remaining $22,954
to the Service. Id. at 216–217.
On appeal, the Fourth Circuit held that because Bow-
en’s compensation was owed to him by the Service rather
than the Union, the lost earnings could not be charged to
the Union. Bowen v. United States Postal Serv., 642 F.2d
79, 82 (4th Cir. 1981). Despite reversing the $30,000
judgment against the Union, the Fourth Circuit refused to
increase the judgment against the Postal Service on the
grounds that Bowen had not cross-appealed. Id. at 82 n.6.
The Supreme Court held that this application of the cross-
appeal rule was “erroneous,” because “Bowen had no
reason to be unhappy with the award.” Bowen, 459 U.S.
at 217–18 n.7. Then-Justice Rehnquist wrote separately
on that point, suggesting that, contrary to the majority, a
conditional cross-appeal may have been required. See id.
at 246–47 (Rehnquist, J., dissenting). There was no
requirement here that Photoscribe file a conditional cross-
appeal.
Rule 60(b)(5) has been applied in situations similar to
this case. For example, in Jackson v. Jackson, the court
found Rule 60(b)(5) relief applicable to a judgment based
on a prior judgment that had been corrected pursuant to
Rule 60(a). 276 F.2d 501, 503–04 (D.C. Cir. 1960). Simi-
larly, in Evans v. City of Chicago, the Seventh Circuit
held Rule 60(b)(5) applicable to a consent decree based on
the outcome of a prior appeal when a subsequent appeal
regarding damages overruled the first panel decision’s
conclusion of liability. 10 F.3d 474, 475–77 (7th Cir. 1993)
(en banc). The court held that “Rule 60(b)(5) calls on the
court to ascertain whether a judgment is ‘based’ on some
earlier decision,” and that, in that case, the “consent
decree [was] ‘based’ on” the earlier panel decision on
liability. Id. at 476–77. The situation here is not mean-
ingfully different. The earlier judgment regarding validi-
LAZARE KAPLAN INT’L, INC. v. PHOTOSCRIBE TECHS., INC. 7
ty was “based on [an] earlier decision”—here, the district
court’s decision as to claim construction. And, as in
Evans, that earlier decision was ultimately reversed.
In my view we should recognize that Rule 60(b)(5)
may be utilized to reopen the invalidity judgment for
reconsideration based on the correct claim construction. I
respectfully dissent.