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Source Vagabond Systems Ltd. v. Hydrapak, Inc.

United States Court of Appeals, Federal Circuit

June 5, 2014

SOURCE VAGABOND SYSTEMS LTD., Plaintiff-Appellant,
v.
HYDRAPAK, INC., Defendant-Appellee AND PEARL COHEN ZEDEK LATZER LLP, Sanctioned Party-Appellant,

Page 1292

Appeals from the United States District Court for the Southern District of New York in No. 11-CV-5379, Judge Colleen McMahon.

AFFIRMED.

WILLIAM G. JENKS, Jenks IP Law, PLLC, of Washington, DC, argued for plaintiff-appellant and sanctioned party-appellant. With him on the brief was GUY YONAY, Pearl Cohen Zedek Latzer, LLP, of New York, New York.

ERIC S. WALTERS, Davis Wright Tremaine LLP, of San Francisco, California, argued for defendant-appellee. With him on the brief was ERICA D. WILSON. Of counsel was BENJAMIN J. BYER, of Seattle, Washington.

Before MOORE, REYNA, and WALLACH, Circuit Judges.

OPINION

Page 1293

Wallach, Circuit Judge .

Source Vagabond Systems, Ltd., Pearl Cohen Zedek Latzer LLP, Guy Yonay, and Clyde Shuman (collectively, " Source" or " Appellants" ) appeal the decision of the district court sanctioning Source under Federal Rule of Civil Procedure 11 (" Rule 11" ) for bringing a frivolous patent infringement suit against Hydrapak, Inc. (" Hydrapak" ). For the reasons set forth below, this court affirms.

Background

Source manufactures water reservoirs in which drinking water can be stored inside backpacks for use in outdoor activities. Source is the assignee of U.S. Patent No. 7,648,276 (the " '276 patent" ), which covers Source's Widepac reservoir.

Guy Yonay and Clyde Shuman are partners in the law firm Pearl Cohen Zedek Latzer LLP. Prior to the present action, Mr. Yonay prosecuted the '276 patent application. In the underlying district court litigation, Mr. Yonay signed the original Complaint on behalf of Source, and Mr. Shuman signed the Amended Complaint.

I. The '276 Patent

The '276 patent, in which Yoram Gill is the named inventor, relates to flexible hydration reservoirs and focuses specifically on the sealing mechanisms for reservoirs.

Page 1294

The reservoir includes a hermetic seal to prevent leakage and a large opening to facilitate the filling and cleaning of the container. '276 patent col. 6 ll. 17-24. The only claim at issue is claim 1, reproduced below:

1. A sealable flexible liquid container system comprising:
a flexible liquid container having a cavity for receiving liquids, said cavity formed of two films having the majority of their perimeter fused, and a portion of the perimeter unfused so as to present a lateral opening for filling the container with liquids, and a liquid dispensing outlet;
a rod having a first end and a second end, fixedly attached to the container laterally across the lateral opening of the flexible container so that a portion of the container adjacent the lateral opening can be folded over the rod and substantially overlap an adjacent portion of the container; and
a sealer comprising an elongated rigid member having two opposite sides along which a hollow cavity is extended with a longitudinal slot wherein said slot is adapted to accommodate said two films, wherein the sealer is provided with an opening on at least one of the opposite sides with a broadening for inserting an end of the rod into the cavity when the portion of the container is folded over the rod into the hollow passage, the slot being narrower than the diameter of the rod, so that the sealer is only to be slidingly mounted sideways over the rod .

Id. col. 10. ll. 20-42 (emphases added).

The closure disclosed in the '276 patent includes a rod, over which the top portion of the container is folded, and a sealer that is slidingly mounted over the rod when the container is folded over the rod. Id. col. 7 ll. 20-28. Figures 2, 3A, and 3B, reproduced below, are illustrative.

Page 1295

(Image Omitted)

Id. figs. 2, 3A, 3B. After water fills the container ((10) in Figures 3A and 3B), the opening has to be hermetically sealed. Id. col. 7 ll. 1-2. Figure 2 illustrates an isometric view of the sealer. Id. col. 7 ll. 3-5.

Figure 3A depicts the water container (10) that is folded so that extension (16) is wrapped over the opening and a fold (62) is formed. Id. col. 7 ll. 20-21. Rod (60) protrudes from the hollow cylinder (52) in order to ease the insertion of the fold between the rod and the cylinder. Id. col. 7 ll. 28-30. " Sealer (50) cannot be removed from the fold unless it slides in an opposite direction to the direction it has been put on since slot (54) is narrower than the diameter of rod (60) ." I ...


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