Dimplex North America Ltd. v. CFM Corporation

Dimplex North America Ltd. v. CFM Corporation
Court (s) Database
Federal Court Decisions
Date
2006-05-11
Neutral citation
2006 FC 586
File numbers
T-1348-01
Decision Content
Date: 20060511
Docket: T-1348-01
Citation: 2006 FC 586
Ottawa, Ontario, May 11, 2006
PRESENT: THE HONOURABLE MR. JUSTICE MOSLEY
BETWEEN:
DIMPLEX NORTH AMERICA LTD.
Plaintiff
and
CFM CORPORATION
Defendant
REASONS FOR JUDGMENT ANDJUDGMENT
INTRODUCTION
[1] Electric simulations of wood or coal fuelled fireplaces and stoves have been marketed for many years but, until recently, lacked a realistic "flame effect". Dimplex North America Limited., developed an improved flame simulating assembly and achieved success in the marketplace with electric fireplaces and stoves employing that device. The firm obtained patent protection for its innovation. Dimplex brought this action against CFM Corporation for infringing that patent. I find that the patent is valid, that CFM's products are infringing and that the defendant is liable in damages or to account for its profits from use of the Dimplex technology.
BACKGROUND
[2] The plaintiff, Dimplex North America Limited ("Dimplex"), is the Cambridge, Ontario based subsidiary of a group of Irish companies known as "Glen Dimplex". Dimplex manufactures and sells electric fireplaces and stoves. The defendant, CFM Corporation ("CFM"), formerly CFM Majestic Inc., is also an Ontario company with a principal office at Mississauga. CFM was founded in 1986 and manufactures and sells a broad range of home-related products including fireplaces and barbecues.
[3] Dimplex is the owner of Canadian Patent 2,175,442 (the "'442" or "Hess" patent) entitled "Flame Simulating Assembly". The application was filed on April 30, 1996, published on October 31, 1997 and the patent was issued on December 22, 1998 naming Kristoffer Hess, David Miller MacPherson and Ignazio Gallo as co-inventors. It will expire on April 30, 2116. Dimplex obtained a corresponding United States Patent, No. 5, 647,580 (the "'580 patent" or "U.S. Hess" patent) on July 1, 1997. U.S. patent 4,965,707 (the "'707" or "Butterfield" patent) was incorporated as prior art in both Hess patents. CFM has manufactured and sold in Canada and exported from Canada for sale, including to the United States, electric fireplaces and stoves alleged to infringe the '442 patent.
[4] This action was commenced by a Statement of Claim filed on July 24, 2001 claiming infringement and seeking a permanent injunction, damages or an accounting of profits, with interest and costs. As Dimplex has alleged that CFM's infringement has been reckless or wilful, it is also seeking aggravated, punitive or exemplary damages.
[5] On consent, a Bifurcation Order was issued on January 8, 2002. As a result of that Order, the trial of this action was limited to a determination of the issues of liability and of eligibility for the remedies sought including entitlement to any punitive, exemplary or aggravated damages. Determination of the quantum of the damages or of the profits, as the plaintiff may elect, will be the subject of a reference after all appeals have been resolved or the time for appeal has expired. If entitlement to punitive, exemplary or aggravated damages is decided in favour of Dimplex, the parties agreed that the quantum of such damages will be referred back to the Court for determination.
[6] In the United States, CFM filed suit against Dimplex in the U.S. District Court for the Northern District of Illinois for a declaratory judgment of non-infringement, invalidity and unenforceability over the '580 patent. Dimplex counterclaimed for infringement. The U.S. proceedings were concluded by a jury verdict in favour of Dimplex on March 8, 2005, including a finding of wilful infringement. A permanent injunction was granted by the presiding judge on May 11, 2005. Under U.S. patent law (35 U.S.C.A. § 284) the Court had the discretion to consider enhancement of damages of up to three times the amount of compensatory damages because of the finding of wilful infringement. Dimplex was granted a 50% enhancement. The judgment in favour of Dimplex was affirmed by the U.S. Circuit Court of Appeals for the Federal Circuit on May 3, 2006.
APPLICABLE LEGISLATION
[7] As the '442 patent application was filed on April 30, 1996, published on October 31, 1997 and issued on December 22, 1998, all issues in this case are governed by the current version of the Patent Act, in effect as of October 1, 1996, by reason of the transitional provisions set out in sections 78.4 and 78.5 of the Patent Act R.S.C. 1985 c.P-4.
THE ISSUES
[8] The following are the issues addressed in these proceedings:
1. What construction ought to be given to the claims of the '442 Patent by the Court?
2. Based on the Court's construction, is the '442 Patent invalid for any of the reasons of anticipation, obviousness or ambiguity?
3. If the '442 Patent is valid, do CFM's electric fireplace products infringe the patent?
4. If the patent is valid and was infringed, is Dimplex entitled to all of the remedies it has claimed?
THE FACT EVIDENCE
[9] Dimplex relied upon the testimony of Mr. Martyn Champ, President of Dimplex North America, Mr. Kristoffer Hess, Dimplex Vice-President Engineering, documentary productions and evidence read in from the examination for discovery of Mr. Colin Adamson, President and Chief Executive Officer of CFM at the material times. CFM relied primarily upon the cross-examinations of the Dimplex witnesses, the documentary evidence and the testimony of Donald Jamieson, CFM's Director of Research and Development.
[10] Champ and Hess testified about the background leading to the development of Dimplex's fireplace technology, to the introduction of the firm's products into the marketplace and their commercial success and to the issuance of the '442 patent. They also described events relating to the alleged infringement by CFM. I found them to be credible and reliable witnesses and base this account of the facts largely on their evidence.
[11] Champ joined Dimplex as president in December 1993 at which time gross sales were approximately $30-31 million annually of low-margin commodity electric heating products, such as fan and baseboard heaters. Dimplex annual sales are currently in the range of $130 million of which approximately 89% comes from electric fireplaces and related products. As of its 2005 fiscal year, Dimplex has sold over 190,000 electric fireplace units in Canada, as well as over
648,000 units in the U.S. I find that this increased business was due primarily to the successful introduction of the improved flame simulating apparatus described in the '442 patent.
[12] In 1993, Dimplex was faced with declining sales of its commodity heating products, partially as a result of increased electricity rates and an increase in the use of natural gas heating. Sales were stagnant and profit margins were squeezed. The firm operated at a loss in fiscal years 1993-1995. Champ's mandate was to rejuvenate the firm and to diversify the product line.
[13] Glen Dimplex had, for many years, sold electric fireplaces in the United Kingdom and Ireland where there was an established market for such products. Through another subsidiary, the company attempted, unsuccessfully, to sell similar fireplaces in North America. They were left with an inventory of some 9,000 units in 1994 which Champ was asked to try to liquidate.
He managed to unload about 400 before abandoning the project and shipping the remainder back to Ireland for distribution in that market.
[14] These "Manhattan" models employed a screen with a partially reflecting surface and a diffusing surface and illuminated ribbons that fluttered under the influence of a fan. As demonstrated in the courtroom, the "fire" in the Manhattan unit does glow somewhat like a coal fire but the visual effects bear little resemblance to the wood or gas flames familiar to North Americans.
[15] Champ thought that a different product could succeed in this hemisphere if it had a flame effect that resembled that of a log fire. He put his staff to work on the project and they developed a prototype based on the Manhattan model. Early in 1995, Champ hired Kristoffer Hess as Vice-President, Engineering, with a mandate to improve on the prototype. Hess came to Dimplex with a proven track record in consumer product development with other companies such as Black & Decker.
[16] Mr. Hess began his work by experimenting with lights, Christmas tinsel and garland, screens and gift wrap to try to get a realistic flame effect. He demonstrated these efforts in court. The effect he was seeking was that of a bright light with varying intensity moving in an upward direction. To achieve that result, he retained some of the elements of the Manhattan unit and the subsequent prototype notably the diffusing screen, disclosed in the Butterfield Patent, and adopted a rotisserie like rod with reflective strips termed the "flicker" element to reflect light back through the flame effect element. When rotated, the appearance in the screen was of rising flames.
[17] By September, 1995 Hess and his team had a rough working model. The basic elements were an array of light bulbs on the bottom producing light that shone up onto the flicker element and was reflected through the screen with the diffusing layer on the back and a partially reflective front surface. In front of that is a simulated fuel bed. Theytook this prototype to the annual Home Hardware Company show at St. Jacob's, Ontario and were encouraged by the interest the unit attracted from hardware store dealers. The decision was made to go into commercial production and to seek patent protection for the flame simulating assembly.
[18] About twenty sales of the prototype were made through a municipal electrical utility before commercial production was begun. About 4000 units of that product, the SIA 1400-120 were manufactured. It employed the black cloth and a fan to make it move. As demonstrated in the courtroom, this model had a much more realistic flame effect than the Manhattan unit.
[19] However, the movable black cloth flame effect element frayed in operation and was costly to produce. It was replaced by static sheet metal. The electric fireplace (trial exhibit P-14), Dimplex introduced at the annual Hearth Products Association (now the Hearth Patio and Barbeque Association [HPBA]) in March 1996, generated considerable interest from the industry, including over 600 sales leads, and positive media attention. Dimplex filed its patent application the next month.
[20] As described in an industry publication in May 1996, the Dimplex fireplace created the "ultimate illusion". The flames were brighter and more the colour of flames in a real wood burning fire. The flames appeared to be coming from within the logs. This was achieved through the reflection of the log set, actually a half log set, in the partially reflecting screen, leaving an impression of depth. The flames appear to be moving upward and not just wavering side to side as in the Manhattan unit employing the Butterfield assembly.
[21] Without having any real sales force at the outset, Dimplex managed to sell about 1000 DIA units by the end of 1996. When exhibited in the competitive U.K. market, the product won awards for "best appearance" and "best of class". It is clear from the evidence that Dimplex had developed an attractive new product that was a commercial success.
[22] At the National Association of Home Builders (NAHB) show at Houston, Texas in January, 1997 Dimplex presented the DIA 1500-120 model electric fireplace under the Symphony brand. CFM did not have a competing product on display at that show but its CEO, Colin Adamson, was present and spent some time watching the traffic at the Dimplex booth.
[23] Shortly after the Houston show, Adamson went to Ireland in an effort to purchase Dimplex from its parent company. He was not successful. In March 1997, Adamson invited Champ to visit the CFM head office in Mississauga to follow up on the discussions in Ireland. During that meeting, Adamson asked Champ to license the fireplace technology to CFM. Champ refused but countered with an offer that Dimplex would manufacture electric fireplaces under an original equipment manufacturer's ("OEM") arrangement to be sold under the CFM brand. Adamson did not pursue that offer.
[24] Champ received two follow up calls from CFM management seeking a licensing arrangement. These approaches ended when CFM learned that Dimplex had concluded an OEM arrangement with Hearth Technologies International (HTI), to produce fireplaces to be sold in the U.S. under the Heat-n-Glo brand. CFM then pursued other options, including the attempted acquisition of electric fireplace technology from another manufacturer and the purchase of a company with an established dealer network in the U.S.
[25] The first electric fireplace that CFM put on display was presented at a HPBA show held at St. Louis, Missouri in March 1998. That fireplace unit was manufactured by a U.S. company, Electro Industries Inc. CFM labeled the Electro fireplace as its own product. Electro had, in the immediately preceding months, reached an agreement with Dimplex to cease production of fireplaces that might infringe the Hess patents. CFM was aware of this and modified the Electro unit's reflecting screen in an attempt to avoid the patent issue. CFM and Electro were considering a joint venture. However, the fireplace model displayed was not successful, perhaps as a result of the modification, and was not put into production. By mid-1998, CFM did not have an electric fireplace on the market.
[26] Donald Jamieson joined CFM in August 1998. He had worked at Lennox Industries for 15 years primarily on gas appliances, furnaces and fireplaces. While at Lennox, he had designed an electric glowing ember bed device that was could be placed in a gas unit. He also worked on an electric fireplace model comprising a flat-screen panel television which was displayed at the 1998 HPBA show.
[27] At CFM, among other duties, Mr. Jamieson was responsible for ensuring that a prototype of a new electric fireplace would be ready for presentation at the 1999 shows. During the development of this prototype in the fall of 1998, several competitor units were purchased and brought to the laboratory. The items were observed while in and out of operation and then disassembled for examination. One of the units dismantled and examined was a Dimplex Symphony unit.
[28] When Mr. Jamieson joined CFM, he reviewed a folder containing electric fireplace patents, including the U.S. Hess '580 patent. Jamieson testified that in developing products for CFM, he and his team avoided what were thought to be the essential components described in the Hess '580 patent. The first electric fireplace they developed was the AE 1000 model displayed at the March 1999 HPBA show in St. Louis. Champ testified that from his observation of its performance, the AE 1000 was not a competitive threat to his products. The marketplace evidently agreed as few units were sold.
[29] However by the time of the March 2000 HPBA show held in Baltimore, Maryland, CFM had developed a greatly improved product, the AE 2000. In the opinion of the Dimplex witnesses and from the Court's own observation from the courtroom demonstration, the flame effect in that product was much improved from that of CFM's earlier effort. Dimplex acquired one of the AE 2000 models from a retailer when they went on sale in the fall of 2000. Hess took it apart and concluded that it incorporated the technology described in the '442 patent.
[30] What led to the improvement of the CFM technology between the AE 1000 model and the AE 2000 model and subsequent CFM electric fireplaces?
[31] Much was made at this trial about the role a Mr. Colm Martin may have played in the improvement of CFM's electric fireplaces. As this is largely the basis for Dimplex's claim for aggravated, or punitive and exemplary damages, I will describe it in some detail.
[32] Mr. Martin, an engineer employed by Glen Dimplex in Ireland, joined Dimplex North America on secondment briefly in the fall of 1996. He returned in the fall of 1997 and remained until early September 1998. During this time he reported to Kristoffer Hess and worked on the design of Dimplex models incorporating the '442 patent technology. At this stage Dimplex was exploiting its success with variations on the Symphony model but the core technology remained the same.
[33] Dimplex employees were allowed to buy discontinued and prototype fireplace models for personal use. Mr. Martin purchased one fireplace from Dimplex on January 30, 1998, ostensibly for his landlord's use and another on September 3, 1998. The fireplace purchased in September 1998 was the most up to date model, intended to be launched in the marketplace in November 1998. Dimplex policy allowed the selling of such prototypes solely to employees. One or more had already been sold to other employees in August 1998. There is no evidence of what Mr. Martin did with that fireplace.
[34] Martin knew when he bought the fireplace on September 3rd, that he was leaving Dimplex to go to CFM. Approached initially by a head-hunter, he had received an offer of employment in July 1998 following an interview with the CEO, Colin Adamson, and CFM's then president, James Lutes. His experience with electric fireplaces was undoubtedly a major factor in this hiring. Martin began working at CFM effective September 8, 1998. By November, 1998 he was manager of the electric fireplace development project.
[35] Early on the morning of his last day at Dimplex, Mr. Champ confronted Martin and asked him to sign a document acknowledging that he was not taking with him any proprietary information, trade secrets, drawings or technical information that could potentially harm Dimplex's business. Martin refused.
[36] On September 24, 1998 Dimplex's solicitors wrote to CFM expressing concern that Mr. Martin had been hired by CFM, given his intimate knowledge of Dimplex's product design and development processes and plans, and the overtures which had been made by CFM to acquire or enter into a business relationship with Dimplex. CFM refused to provide any undertakings to Dimplex in reply but offered an assurance that there would be no misuse of confidential information. There is no evidence that Martin breached Dimplex confidence.
[37] Mr. Martin worked on many aspects of the AE 1000, including general design of the cabinet, tinted light screen, plastic light filter screen, and a rotating chrome reflector described as the "soup can" analogous to Hess' rotisserie but not infringing. Martin was listed as the sole inventor on CFM's initial U.S. and Canadian patent applications for the AE 1000. But his performance at CFM was not satisfactory, according to Mr. Jamieson, and he was encouraged to seek other opportunities. Martin resigned on April 9, 1999, giving two weeks' notice. He left with a positive reference signed by Jamieson.
[38] Jamieson testified that CFM began working on the AE 2000 electric fireplace unit, the first allegedly infringing model, in June 1999, several months after Martin's departure. The AE 2000 design included a sheet-metal screen with flame shaped cut outs and a flicker element, which CFM called a "Flame Generating Assembly". Jamieson could not recall who came up with the idea of using the flicker element. The minutes of CFM's research and development committee for the relevant time-period have not been produced. The AE 2000 was released in November 1999. According to CFM's 2001 Annual Report, while the AE 1000 was not a big seller, CFM saw a fivefold increase in sales of the AE 2000 over the prior model.
[39] CFM has produced several fireplace and stove models subsequent to the AE 2000, mostly differentiated by changes in aesthetic elements such as door sets and cast-iron fronts. Features such as remote controls were also added. However, the core technology of the CFM fireplaces and stoves remained the same from the AE 2000 model forward until the outcome of the U.S. infringement proceedings. As of CFM's fiscal year 2004, the defendant had sold over 310,000 units employing the technology initially presented in the AE 2000. CFM continued to sell fireplaces employing the same technology until March 2005 when, in response to the U.S. ruling, it replaced the screen with a partially reflecting surface that it was employing with a matte screen.
[40] Having considered the evidence in this trial, I have no difficulty finding that CFM's success in the electric fireplace marketplace stemmed largely from the changes it made to its flame effect technology in June - September, 1999. As I will discuss below, those changes infringed the '442 and '580 Hess patents.
THE EXPERTS
[41] Dimplex tendered the opinion evidence of Mr. Samuel R. Phillips, of Portola Valley, California, as an expert in optical systems, mechanical engineering and manufacturing.
Mr. Phillips is a professional engineer and a graduate of the California Institute of Technology with a Master of Science in Mechanical Engineering and a Bachelor of Science in Engineering. He has some 40 years of experience in optics and in the development and manufacture of a broad range of products including those constructed with sheet metal. Mr. Phillips has worked as a consulting engineer since 1985 and, for about six years, as an expert witness in technical litigation. Prior to being retained by Dimplex in May, 2004 he had had no experience with electric fireplaces.
[42] Mr. Phillips is very knowledgeable and experienced in the fields of mechanical engineering and optical systems. The lack of direct experience with electric fireplaces did not diminish his ability to explain how they functioned or to comment on how a person skilled in the art, which he defined as a vocational school graduate with knowledge or experience in sheet metal work and electrical systems, would read the patent in question.
[43] It became apparent during cross-examination that Mr. Phillips, in preparing his affidavit, copied or paraphrased some 29 passages from a brief submitted by Dimplex's counsel in the U.S. proceedings, including the dictionary definitions of eight terms. CFM urged me to conclude from this that Mr. Phillips was a professional witness, a "hired gun", an advocate for Dimplex and that his opinion evidence was not independent in the sense described by Cresswell J., in the "Ikarian Reefer" case, that is, the "product of the expert uninfluenced as to form or content by the exigencies of the litigation": National Justice Compania Riviera S.A. v. Prudential Assurance Company Ltd., [1993] 2 Lloyd's Rep. 68 at 81.
[44] It is regrettable that Mr. Phillips chose to rely upon the terms and phrases employed in the U.S. brief to convey his views but I am not convinced that in so doing he lost the objectivity and impartiality required to assist the court with his expertise. In effect, he adopted the language in that brief as his own in writing his report as it accorded with his understanding of the technology at issue and used it to describe his opinion. While I do not condone this practice, I doubt that there are many expert reports that are not, to some extent, the product of collaboration between counsel and the expert if only to conform to varying legal requirements in different jurisdictions or to focus the report on the issues. I am unable to conclude that Mr. Phillips' evidence lacked such objectivity that I should ignore it or give it little weight. I found his evidence, generally, to be helpful, clear and precise.
[45] CFM relied upon the opinion evidence of Dr. Samir Barudi of Huntington Beach, California. Dr. Barudi has a Doctorate in Chemical Engineering from the California Institute of Technology and other degrees in mechanical engineering and business engineering. He has 25 years of engineering experience, including more recently, experience with "hearth products", i.e., fireplaces and barbecues.
[46] Dr. Barudi has industry related experience which Mr. Phillips has not. However, he had not worked with optics or electric fireplaces prior to 1993 when he joined Superior Fireplace, primarily a wood and gas fireplace company. While with Superior, Dr. Barudi attempted to improve its electric fireplace product. The result was not a success. Indeed during his tenure, as VP Engineering, Superior sought an OEM arrangement with Dimplex. Subsequently, Dr. Barudi was involved with several other enterprises attempting to gain a foothold in the hearth products marketplace. Dr. Barudi currently works as a college lecturer in chemistry, as a consultant, as an expert witness in litigation, and owns and operates an automotive service franchise.
[47] I found Dr. Barudi's evidence to be generally helpful but had difficulty with certain of his views as they did not accord with the evidence as I saw it, or with the terms of the patent. Where the evidence of the two experts was in conflict, I tended to prefer that of Mr. Phillips.
[48] Among the difficulties I had with Dr. Barudi's evidence was his insistence that the reflected image of the fuel bed must be "crisp" to fall within the claims, and his testimony that he could only see shadows of the logs in the CFM screen. Mr. Phillips had no difficulty in seeing the reflection of the ember bed and logs in the screen and neither did I when invited by counsel to observe the CFM demonstration units in operation in the courtroom. I concluded that Dr. Barudi shaped his opinion to support a finding on construction that a "crisp image" was an essential element of the claims.
CONSTRUCTION OF THE PATENT AT ISSUE
[49] As frequently stated, the first step in analysing validity and infringement issues in a patent suit is to construe the claims. The relevant date for conducting the construction analysis in these proceedings is October 31, 1997when the '442 Patent was published. The principles to be applied by the Court were reiterated by the Supreme Court in Whirlpool Corp. v. Camco Inc., [2000] 2 S.C.R. 1067, 2000 SCC 67 [Whirlpool ]and the concurrently released Free World Trust v. Électro-Santé Inc., [2000] 2 S.C.R. 1024, 2000 SCC 66 [Free World Trust]. In essence, claims are to be read in an informed and purposive way to achieve fairness and predictability and to define the limits of the monopoly.
[50] The key to purposive construction is the identification by the Court, with the assistance of the skilled reader, of the particular words or phrases in the claims that describe what the inventor considered to be the "essential elements" of his invention (Whirlpool, above, at para. 45). A patent "must be read by a mind willing to understand, not by a mind desirous of misunderstanding", per Chitty J. in Lister v. Norton Brothers and Co. (1886), 3 R.P.C. 199 at 203 (Ch. D.). A "mind willing to understand" necessarily pays close attention to the purpose and intent of the author. A patent must be given such interpretation "as best ensures the attainment of its objects": Whirlpool, above, at para.49.
[51] The Court may have regard to the patent specification, including the drawings, in order to understand the sense in which certain terms are used, but the specification cannot be used to enlarge or reduce the scope of the claims, properly understood: Metalliflex Ltd. v. Wienenberger Aktiengesellschaft, [1961] S.C.R. 117 at 122, (1960), 35 C.P.R. 49; Whirlpool, above, at para.52.
[52] A patent is notionally addressed to a person skilled in the art or science of the subject-matter and is to be read as such a person would have read it when it first became public. This hypothetical person possesses the ordinary skill and knowledge of the particular art to which the invention relates and a mind willing to understand a specification addressed to him. He is a man who is going to try to achieve success and not one who is looking for difficulties or seeking failure: Free World Trust, above, at paragraph 44, drawing on H.G. Fox in The Canadian Patent Law and Practice Relating to Letters Patent for Inventions, 4th ed. (Toronto: Carswell, 1969) at 184).
[53] In these proceedings, the patent in question relates to the assembly of fairly common devices and materials to create the illusion of fire and flames in a sheet metal box. The expert witnesses agreed that the ordinary person skilled in the art would have to have some knowledge or equivalent experience in electrical services and sheet metal work. Mr. Phillips placed the degree of skill and knowledge at the vocational school level. Dr. Barudi would require some understanding of mathematics and some experience in the hearth industry, particularly with electric fireplaces. In my view, Dr. Barudi set too high a standard. Having viewed the innards of the several models exhibited in the courtroom and having heard the testimony of Messrs Hess and Jamieson as to how their respective products were developed, I think Mr. Phillips was more on the mark.
[54] The '442 patent has 39 claims. Of these, Dimplex asserts that claims 1, 5, 7, 13, 14, 15, 16, 24, 25, 31, 32, and 33 have been infringed by CFM. Of the asserted claims, claims 1 and 31 are independent claims. Claims 5, 7, 13, 14, 15, 16, 24 and 25 are dependent upon claim 1; claim 32 is dependent on claim 31; claim 33 is dependent upon claims 1 through 25, 31 and 32.
[55] There is substantial agreement between the parties on the meaning of the claims. The terminology in dispute in the independent claims 1 and 31 is highlighted below:
1. A flame simulating assembly comprising:
a light source;
a flame effect element having means for transmitting light from said light source to produce a moving flame effect;
at least one flicker element having at least one reflective surface, said flicker element being positioned intermediate of said light source and said flame effect element to reflect light from said light source for subsequent transmission by said flame effect element;
a screen having a partially reflecting surface and a diffusing surface, said flame effect element extending proximate to said diffusing surface wherein said transmitted light produces an image on the screen which resembles moving flames; and
a simulated fuel bed positioned adjacent to said partially reflecting surface wherein an image of the fuel bed is displayed on the screen and wherein the image of moving flames appears to emanate between the simulated fuel bed and its image in the screen.
31. A flame simulating assembly, comprising:
a light source;
at least one flicker element having at least one reflective surface for reflecting light from said light source;
a rotor for rotating said flicker element about an axis;
a screen having a partially reflecting surface and a diffusing surface, wherein light reflected from said rotating flicker element onto said diffusing surface produces an image which resembles moving gasses from a fire; and
a simulated fuel bed positioned adjacent to said partially reflecting surface wherein an image of the fuel bed is displayed on the screen and wherein the image of moving gasses appears to emanate between the simulated fuel bed and its image on the screen.
[56] The significant differences between these claims are that claim 31 does not require a flame effect element and refers to moving gasses instead of moving flames.
[57] The background portion of the '442 patent identifies U.S. patent 4, 965,707 (the '707 or Butterfield patent) as prior art. The Butterfield assembly uses a system of billowing ribbons and a diffusion screen to produce a flame effect as if from a coal fuel source. The background to the '442 Patent notes the need for an assembly to produce a flame effect that more closely resembles real flames from a wood log fire and with greater light intensity.
[58] In the detailed description of the preferred embodiment, the inventors describe one means for achieving that impression in a simulated firebox housing. The simulated fuel bed would be supported on a platform at the lower front portion of the housing. The fuel bed itself is a translucent plastic shell vacuum formed and coloured to resemble logs and embers. Beneath it are three 60 watt light bulbs. Immediately behind the fuel bed is a transparent vertical screen with a partially reflecting surface and a diffusing surface. The fuel bed is reflected in the reflecting surface of that screen.
[59] The preferred embodiment also speaks of using both a flicker element and a moving flame effect element formed from a lightweight, substantially opaque material such as polyester, supported loosely between horizontal supports. Slits are cut into it to permit the passage of light as it billows under the influence of air from a blower. Alternatively, as described in Butterfield it could consist of discrete elements (i.e., ribbons). The flicker element is a rod turned on its axis horizontally by an electric motor. The rod bears reflective strips which extend radially and when moved by the rotation of the rod gives the appearance of upward motion on the reflected light. While both the flicker element and the flame effect element would be used in the preferred embodiment, the inventors contemplated that the flicker element could be used alone. They also indicate that a screen as described in Butterfield could be employed, of which more will be said below.
The Disputed Terms:
"a flame effect element having means for transmitting light from said light source to produce a moving flame effect"
[60] The issue with respect to this phrase is whether, as CFM contends, the flame effect element itself must move to produce a "moving flame effect". This is of significance because both the Dimplex and the CFM products produce a moving flame effect through the rotating flicker element rather than the flame effect element which remains stationary.
[61] The detailed description of the preferred embodiment in the '442 Patent indicated that the flame effect element would be formed from a single thin sheet of a lightweight material such as polyester and would billow or ripple under the influence of air currents. As noted above, Dimplex initially used a sheet of black silk which frayed in operation and replaced it with static sheet metal for cost and quality control reasons.
[62] Dr. Barudi read the specification, in conjunction with the concluding words of the phrase in the claim, as requiring the "flame effect element" to be movable. He supported that interpretation by references to the limitations set out in claims 2, 3 and 4. Claim 2 adds a limitation that the assembly claimed in claim 1 comprises means for moving the flame effect element to produce the moving flame effect. Claim 3 says that means is a airflow generator and claim 4 requires that the flame effect element be adapted to move in response to an airflow. Claims 2, 3 and 4 are not asserted by Dimplex in these proceedings.
[63] In Mr. Phillips' opinion, the claim for the flame effect element in claim 1 is broadly stated and the element could either move or remain stationary in transmitting the light that produces a moving flame effect.
[64] In closing argument, the defendant did not take the position that the flame effect element must move. It acknowledged the possibility that the necessary motion in claim 1 may come from the flicker element rather than the flame effect element. However, it argues that the flame effect element must at least be capable of motion to give meaning to the dependent claims. In support of that proposition, it relies on the concession by Mr. Phillips, on cross-examination, that while he believed claim 1 could read on a flame effect element that was made of glass, that interpretation would render claim 4 inoperable if the glass were immovable. Further, the defendant submits, claim 14 which requires movement of the flicker element is redundant if that movement is an essential element of claim 1.
[65] Pelletier J., as he then was, discussed the relationship of dependent and independent claims in Halford et al.v. Seed Hawk Inc.et al. (2004), 46 F.T.R. 1, 2004 FC 88 at paragraphs 90-95. Justice Pelletier observed that it is clear from section 87 of the Patent Rules SOR/96-423 that a dependent claim includes all the features and limitations of the claim which it incorporates by reference. As a corollary to that principle, the independent claim cannot be given a construction which is inconsistent with the claims which are dependent upon it.
[66] A construction of the flame effect element in claim 1 as either movable or immovable is not, in my view, inconsistent with the claims that depend upon it. A person skilled in the art would understand from a fair reading of the patent as a whole that a "flame effect element having means for transmitting light to produce a moving flame effect" could be one that moves or does not move, as the circumstances dictate. The key is that it is capable of transmitting light to produce a moving flame effect which it does through the flame shaped and other holes that pierce the element. Movement of that light is achieved by the rotation of the flicker element as claimed in claim 14.
[67] The structure of claims 1 through 4 of the Hess patent, when read together supports this construction. The only limitation on the flame effect element in claim 1 is that it has the means for transmitting light. The further limitations requiring that it be adapted to move in response to an airflow are introduced in the dependent claims. There is no reference in claim 2 to any particular means for moving the flame effect element. Claim 3 defines the means as comprising an airflow generator and claim 4 specifies an additional property, that being the airflow response.
"a screen having a partially reflecting surface"
[68] Mr. Phillips construed these terms as referring to a screen with a surface that partially bends light as that is what in his view a person of ordinary skill would understand from the meaning of "reflecting." A reflecting surface bends light. A partially reflecting surface therefore is one that partially bends light; the rest of the light gets through it. Again, this is an interpretation that was used by Dimplex counsel in the U.S. proceedings. That does not render it inaccurate.
[69] The '442 patent specification incorporates by reference the '707 Butterfield patent as describing a suitably partially reflecting screen that could be successfully used as part of the invention. Dr. Barudi reads Butterfield as always requiring a partly or lightly silvered surface and reads that limitation into the meaning of "partially reflecting surface" in claim 1. However, he does not seem to have considered that Butterfield describes a number of acceptable embodiments for a partially reflecting screen ranging from plain glass to a semi-silvered surface.
[70] Phillips views this range as consistent with the meaning of partially reflecting surface as each would have that effect, albeit to varying degrees. That is, in my view, a correct reading of Butterfield. A variety of materials may be used for the screen claimed including glass or plastics, such as the tinted "acrylite" product used by CFM. What is essential is a screen that is sufficiently reflective to create an illusion of depth in the displayed image of the fuel bed. Screens with a gloss finish would have that effect whatever their material. CFM's acrylite screens had a gloss finish.
[71] The meaning of diffusing surface in the patent is clear. The experts agree that diffusion means dispersion in the scattering sense (i.e. dispersion and softening of light as by passage through frosted glass). Therefore, according to the plain and ordinary meaning of that term, claim 1 and claim 31 recite a screen with a surface that disperses and softens light.
"image of the fuel bed is displayed on the screen"
[72] In