Free Motion to Amend/Correct - District Court of Delaware - Delaware

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

: : : Plaintiff, : : : v. : : SCHLEGEL ELECTRONIC MATERIALS, : INC., : : : Defendant. : __________________________________________: : SCHLEGEL ELECTRONIC MATERIALS, : INC., : Plaintiff, : : : v. : : PARKER-HANNIFIN CORPORATION, : : : Counter-Defendant. : __________________________________________:

PARKER-HANNIFIN CORPORATION, and PARKER INTANGIBLES, LLC,

Civil Action No 1:07-cv-00266 - ***

DEFENDANT SCHLEGEL ELECTRONIC MATERIALS' UNOPPOSED MOTION FOR LEAVE TO FILE AN AMENDED ANSWER AND COUNTERCLAIM Defendant Schlegel Electronic Materials ("Schlegel"), through counsel, hereby moves the Court, pursuant to Fed.R.Civ.P. 15(a) , for leave to file and serve an Amended Answer and Counterclaim, attached hereto as Exhibit 1.

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A second copy ("Redlined") of this pleading "which ... indicate[s] in what respect it differs from the pleading which it amends," as required by Local Rule 15.1, is attached hereto as Exhibit 2. This motion is filed within the time frame set by the Court's Scheduling Order for motions to amend pleadings. (D.I., 21, ¶ 2). Schlegel conferred with counsel for Plaintiffs, as required under Local Rule 7.1.1, and Plaintiffs do not oppose this motion.

WHEREFORE, defendant requests leave to file the attached Amended Answer and Counterclaims. Respectfully submitted, this 18th day of December, 2007.

WOMBLE CARLYLE SANDRIDGE & RICE, PLLC A Professional Limited Liability Company

/s/ James M. Lennon George Pazuniak (#478) James M. Lennon (# 4570) Anna Martina Tyreus (# 4771) 222 Delaware Avenue, Suite 1501 Wilmington, DE 19801 Tel: (302) 252-4326 Fax: (302) 661-7726 [email protected] [email protected] [email protected] Attorneys for Schlegel Electronic Materials, Inc.

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CERTIFICATE OF SERVICE I hereby certify that on December 18, 2007, I caused the foregoing motion and attached exhibits to be served upon the following in the manner so indicated:

VIA HAND DELIVERY AND EMAIL Steve Nash Connolly Bove Lodge & Hutz LLP The Nemours Building 1007 N. Orange Street Wilmington, DE 19899 This 18th day of December, 2007.

/s/ James M. Lennon James M. Lennon (DE # 4570)

WCSR 3795053v1

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

PARKER-HANNIFIN CORPORATION, and PARKER INTANGIBLES, LLC Plaintiff, v. SCHLEGEL ELECTRONIC MATERIALS, INC., Defendant. SCHLEGEL ELECTRONIC MATERIALS, INC., Counterclaimant, v. PARKER-HANNIFIN CORPORATION, Counter-Defendant.

) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )

C.A. No. 1:07-cv-266 JURY TRIAL DEMANDED

AMENDED ANSWER AND COUNTERCLAIM OF DEFENDANT

SCHLEGEL ELECTRONIC MATERIALS, INC.
Defendant Schlegel Electronic Materials, Inc. ("Schlegel") hereby answers the Complaint of Plaintiff Parker-Hannifin Corporation and Parker Intangibles, LLC (collectively "Parker") as follows: 1. Schlegel lacks knowledge or information sufficient to form a belief as to

the truth of the allegations contained in Paragraph 1 of the Complaint. 2. Schlegel lacks knowledge or information sufficient to form a belief as to

the truth of the allegations contained in Paragraph 2 of the Complaint.

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3.

Schlegel denies that it is a corporation organized and existing under the

laws of the State of New York, and denies that its principle place of business is 1555 Jefferson Road, but admits the remaining allegations contained in Paragraph 3 of the Complaint. JURISDICTION AND VENUE 4. Schlegel admits subject matter jurisdiction of this Court as alleged in

Paragraph 4 of the Complaint and waives objection to personal jurisdiction. 5. Schlegel waives objection to venue of this Court as alleged in Paragraph 5

of the Complaint. PARKER-HANNIFIN'S PATENTS 6. Schlegel admits that U.S. Patent No. 6,387,523 ("the '523 patent") issued

on May 14, 2002, but denies that it was duly and legally issued. Schlegel denies that Parker has standing to assert the '523 patent. Schlegel is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations contained in paragraph 6 of the Complaint. 7. Schlegel admits that U.S. Patent No. 6,521,348 ("the '348 patent") issued

on February 18, 2003, but denies that it was duly and legally issued. Schlegel denies that Parker has standing to assert the '348 patent. Schlegel is without information or knowledge sufficient to form a belief as to the truth of the remaining allegations contained in paragraph 7 of the Complaint. 8. Schlegel admits that U.S. Patent No. 6,716,536 ("the '536 patent") issued

on April 6, 2004, but denies that it was duly and legally issued. Schlegel denies that Parker has standing to assert the '536 patent. Schlegel is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations -2-

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contained in paragraph 8 of the Complaint. 9. Schlegel admits that U.S. Patent No. 6,777,095 ("the '095 patent") issued

on August 17, 2004, but denies that it was duly and legally issued. Schlegel denies that Parker has standing to assert the '095 patent. Schlegel is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations contained in paragraph 9 of the Complaint. 10. Schlegel admits that U.S. Patent No. 6,248,393 ("the '393 patent") issued

on June 19, 2001, but denies that it was duly and legally issued. Schlegel denies that Parker has standing to assert the '393 patent. Schlegel is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations contained in paragraph 10 of the Complaint. PARKER-HANNIFIN'S ALLEGATIONS OF INFRINGEMENT 11. Complaint. 12. Complaint. SCHLEGEL'S AFFIRMATIVE DEFENSES 13. Upon information and belief, Schlegel has not infringed and is not Schlegel denies each and every allegation of Paragraph 12 of the Schlegel denies each and every allegation of Paragraph 11 of the

infringing any claim of Parker's `523, `348, `536, `095, and `393 patents, either directly or by inducing or contributing to their infringement by others. 14. Upon information and belief, the claims of Parker's `523, `348, `536, `095,

and `393 patents are invalid for failure to satisfy the requirements of the United States patent laws, 35 U.S.C. §§ 101 et seq., including but not limited to 35 U.S.C. §§ 101, 102, 103, and 112. -3-

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15.

Upon information and belief, Parker's `523, `348, `536, `095, and `393

patents are invalid as a result of obviousness-type double patenting. 16. Upon information and belief, Parker is estopped by virtue of amendments

and statements made during the course of prosecution of Parker's `523, `348, `536, `095, and `393 patents from obtaining any construction of the claims of these patents that could cover any of Schlegel's products and the methods by which those products are made. 17. On information and belief, Parker and Parker Intangibles LLC have failed

to comply with the provisions of 35 U.S.C. § 287(a) and are therefore barred from recovery of any damages prior to service of the Complaint. 18. Upon information and belief, Parker's `523, `348, `536, `095, and `393

patents ("Parker Patents") are unenforceable, because of at least three instances of inequitable conduct by applicants in the United States Patent and Trademark Office ("PTO" or "Patent Office"), each of which separately, independently and collectively establishes a basis for unenforceability. The particular bases for the inequitable conduct defenses are as follows: a. Erma Cameron was the PTO examiner ("Examiner Cameron") for all of the applications leading to the Parker Patents (hereinafter called the applications leading to, and the resultant, Parker Patents are collectively referred to as the "Cameron Applications"). b. John A. Molnar, Jr. ("Molnar") was the prosecuting attorney for each of the Cameron Applications, c. Michael H. Bunyan ("Bunyan") and William I. Flanders ("Flanders") are the named inventors in each of the Cameron Applications.

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d. Upon information and belief, Molnar, Bunyan, and Flanders were at all times during the prosecution of these applications employed by Parker Hannifin Corporation. e. The history and relationship of the Cameron Applications is as follows: The `393 patent issued on June 19, 2001 as the result of patent application No. 09/250,338 filed on February 16, 1999 claiming priority from provisional application No. 60/076,370 filed on February 27, 1998. The `523 patent issued on May 14, 2002 as the result of patent application No. 09/883,785 filed on June 18, 2001 as a continuation of the above patent application No. 09/250,338 filed on February 16, 1999, now U.S. Pat. No. 6,248,393, and claiming priority from provisional application No. 60/076,370 filed on February 27, 1998. The `348 patent issued on February 18, 2003 as the result of patent application No. 10/142,803 filed on May 9, 2002 as a continuation of application No. 09/883,785, filed on June 18, 2001, now Pat. No. 6,387,523, which is a continuation of application No. 09/250,338, filed on February 16, 1999, now Pat. No. 6,428,393, which claims priority from provisional application No. 60/076,370 filed on February 27, 1998. The `536 patent issued April 6, 2004 as the result of patent application No. 10/318,609 filed on December 11, 2002 as a continuation of application No. 10/142,803, filed on May 9, 2002, now Pat. No. 6,521,348, which is a continuation of application No. 09/883,785, filed on June 18, 2001, now Pat. No. 6,387,523, which is a continuation of application No. 09/250,338, filed on February 16, 1999, now Pat. No. 6,248,393, which claims priority from provisional application No. 60/076,370 filed on February 27, 1998. The `095 patent issued August 17, 2004 as the result of patent application No.

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10/753,016 filed on January 7, 2004 as a continuation of application No. 10/318,609, filed on December 11, 2002, now Pat. No. 6,716,536, which is a continuation of application No. 10/142,803, filed on May 9, 2002, now Pat. No. 6,521,348, which is a continuation of application No. 09/883,785, filed on June 18, 2001, now Pat. No. 6,387,523, which is a continuation of application No. 09/250,338, filed on February 16, 1999, now Pat. No. 6,248,393, which claims priority from provisional application No. 60/076,370 filed on February 27, 1998. The application sequence is shown in the following chart: Provisional Patent App. Serial No. 60/076,370 Filed Feb. 27, 1998
|

(converted)
|

Patent App. Serial No. 09/250,338 Filed Feb. 16, 1999 (issued as `393 patent on June 19, 2001)
|

(continuation)
|

Patent App. Serial No. 09/883,785 Filed June 18, 2001 (issued as `523 patent on May 14, 2002)
|

(continuation)
|

Patent App. Serial No. 10/142,803 Filed May 9, 2002 (issued as `348 patent on Feb. 18, 2003)
|

(continuation)
|

Patent App. Serial No. 10/318,609 Filed Dec. 11, 2002 (issued as `536 patent on Apr. 6, 2004)
|

(continuation)
|

Patent App. Serial No. 10/753,016 Filed Jan. 7, 2004 (issued as `095 patent on Aug. 17, 2004) f. At the time the first Cameron Application was filed, the PTO regulations,

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37 C.F.R. § 1.56 (1992), provided in part, as follows: Section 1.56 Duty to disclose information material to patentability. (a) A patent by its very nature is affected with a public interest. The public interest is best served, and the most effective patent examination occurs when, at the time an application is being examined, the Office is aware of and evaluates the teachings of all information material to patentability. Each individual associated with the filing and prosecution of a patent application has a duty of candor and good faith in dealing with the Office, which includes a duty to disclose to the Office all information known to that individual to be material to patentability as defined in this section. The duty to disclose information exists with respect to each pending claim until the claim is cancelled or withdrawn from consideration, or the application becomes abandoned. Information material to the patentability of a claim that is cancelled or withdrawn from consideration need not be submitted if the information is not material to the patentability of any claim remaining under consideration in the application. There is no duty to submit information which is not material to the patentability of any existing claim. The duty to disclose all information known to be material to patentability is deemed to be satisfied if all information known to be material to patentability of any claim issued in a patent was cited by the Office or submitted to the Office in the manner prescribed by Secs. 1.97(b)-(d) and 1.98. However, no patent will be granted on an application in connection with which fraud on the Office was practiced or attempted or the duty of disclosure was violated through bad faith or intentional misconduct. The Office encourages applicants to carefully examine: (1) Prior art cited in search reports of a foreign patent office in a counterpart application, and (2) The closest information over which individuals associated with the filing or prosecution of a patent application believe any pending claim patentably defines, to make sure that any material information contained therein is disclosed to the Office. (b) Under this section, information is material to patentability when it is not cumulative to information already of record or being made of record in the application, and (1) It establishes, by itself or in combination with other information, a prima facie case of unpatentability of a claim; or (2) It refutes, or is inconsistent with, a position the applicant takes in: (i) Opposing an argument of unpatentability relied on by the Office, or (ii) Asserting an argument of patentability.

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A prima facie case of unpatentability is established when the information compels a conclusion that a claim is unpatentable under the preponderance of evidence, burden-of-proof standard, giving each term in the claim its broadest reasonable construction consistent with the specification, and before any consideration is given to evidence which may be submitted in an attempt to establish a contrary conclusion of patentability. (c) Individuals associated with the filing or prosecution of a patent application within the meaning of this section are: (1) Each inventor named in the application; (2) Each attorney or agent who prepares or prosecutes the application; and (3) Every other person who is substantively involved in the preparation or prosecution of the application and who is associated with the inventor, with the assignee or with anyone to whom there is an obligation to assign the application. (d) Individuals other than the attorney, agent or inventor may comply with this section by disclosing information to the attorney, agent, or inventor. g. The above provisions of Rule 56 continue to this day, and Rule 56 has been amended only to add an additional sub-section (e) [65 FR 54666, Sept. 8, 2000], which provides: (e) In any continuation-in-part application, the duty under this section includes the duty to disclose to the Office all information known to the person to be material to patentability, as defined in paragraph (b) of this section, which became available between the filing date of the prior application and the national or PCT international filing date of the continuation-in-part application. h. Hereinafter, the terms "Applicant" or "Applicants" means anyone under a duty to disclose material information to the PTO pursuant to 37 C.F.R. § 1.56, including Molnar, Bunyan, Flanders and any other person substantively involved in the preparation or prosecution of one or more of the Cameron Applications. i. On October 22, 1998, in addition to the Cameron Applications, Applicants filed provisional application No. 60/105,271. This provisional was converted into application No. 09/412,059 on October 4, 1999. The prosecuting attorney on behalf of Parker was Molnar and the named inventor is Bunyan. The PTO examiner for these -8-

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applications was Duc Truong (Examiner Troung). This application issued on June 25, 2002 as U.S. Patent No. 6,410,137 ("the `137 Patent"). Collectively this provisional, the converted application, and the `137 Patent will be referred to hereinafter as "Truong Application." j. The timeline of the Applicants' Cameron and Truong Applications is as follows:

Cameron Applications Timeline Feb. 27, 1998 Filed Provisional Patent App. Serial No. 60/076,370

Truong Application Timeline

Oct. 22, 1998 Filed Provisional Patent App. Serial No. 60/105,271

Feb. 16, 1999 Patent App. Serial No. 09/250,338 (issued as `393 patent on June 19, 2001) Oct. 4, 1999 Patent App. Serial No. 09/250,338 (issued as `393 patent on June 25, 2002) June 18, 2001 Filed Continuation Patent App. Serial No. 09/883,785 (issued as `523 patent on May 14, 2002) May 9, 2002 Filed continuation Patent App. Serial No. 10/142,803 (issued as `348 patent on Feb. 18, 2003) Dec. 11, 2002 Filed continuation Patent App. Serial No. 10/318,609 (issued as `536 patent on Apr. 6, 2004) Jan. 7, 2004 Filed continuation Patent App. Serial No. 10/753,016 (issued as `095 patent on Aug. 17, 2004)

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k. The Truong Application, as filed October 22, 1998characterized the invention as follows: [T]he present invention is directed to an intumescent, flame-retardant pressure-sensitive adhesive (PSA) composition particularly adapted for use in foil or fabric-over-foam EMI shielding gasket constructions for bonding an electrically-conductive foam or fabric sheath or jacket to a polyurethane or other foam core. ... Gaskets of such construction advantageously have been observed to achieve a UL94 rating of V-0 over a range of cross-section (`137 patent, Col 3 lines 27-42). l. The above statement of the invention from the Truong Application is nearly identical to the statement of the invention from the Cameron Applications: The present invention is directed to an electrically-conductive, flame retardant material for use in fabric-over-foam EMI shielding gaskets, and to a method of manufacturing the same. In having a layer of a flame retardant coating applied to one side of an electrically-conductive, generally porous fabric, the material of the invention affords UL94 V-0 protection when used as a jacketing in a fabric-over-foam gasket construction. (`393 patent, Col 3 lines 25-32). m. The Cameron Applications define "flame retardant" gaskets as those "achieving a rating of V-0 under UL Std. No. 94, 'Tests for Flammability of Plastic Materials for Parts in Devices and Appliances` (1991)" n. The Truong and Cameron Applications are both directed to an EMI shielding material that meets the Underwriters Laboratory 94 V-0 vertical burn rating standard for flame retardance ("UL 94 V-0") by applying a layer with flame retardant additives between an exterior conductive fabric/sheath and an interior foam core. o. This similarity, standing alone, makes the Truong Application material information to the prosecution of the Cameron Applications that should have been disclosed to the PTO. - 10 -

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p. Upon information and belief, the existence of the co-pending Truong Application was never disclosed to Examiner in the Cameron Applications. q. The Truong Application further discloses that a "unique combination of flame retardant additives" is required to achieve a rating of V-0 under UL Std. No. 94. The three components of this mixture are: "a halogenated first flame retardant component, an metal oxide-based second flame retardant component, and a filler component of expandable, intercalated graphite particles." (`137 patent, Col 3 lines 52-55). r. The Truong Application further teaches that it was "unexpected" that this three-part mixture was "critical" to achieve a UL 94 V-0 rating: [t]he ... results confirm that the EMI shielding material of the present invention is UL94 V-0 compliant when used as a jacketing in a fabricover-foam gasket construction. Unexpectedly, it was found that the use of a unique combination of three different flame retardant additives was critical in the use of any of the additives alone or without one of the other additives was insufficient to meet the required UL-V0 criteria. (`137 patent, Col. 12 lines 21-28). On January 25, 2002, Molnar filed an Amendment and Response in which he distinguished certain prior art on the sole basis that the prior art did not disclose the graphite component and further argued, as a basis for patentability, that: [u]nexpectedly, it has been observed that such flame retardant additive combination functions synergistic. In this regard, each of the components separately has been observed not to impart flame retardancy to the PSA composition effective to achieve UL 94 V-0 protection within a fabric or foil over foam EMI shielding gasket construction. s. The above representation in the Truong Application manifests that Applicants not only knew that a special three-part mixture was critical to achieving a ULV0 rating, but that Applicants possessed test data and results, as of October 22, 1998, - 11 -

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which demonstrated that halogenated or metal-oxide based flame retardant additives in the interior layer between the fabric/sheath and foam, individually or in combination with each other, were insufficient to produce a product meeting the UL 94 V-0 criteria. The above data and results identified in the Truong Application is hereafter referred to as the "Test Results." t. Despite the representation in the Truong Application that a graphite-based chemical mixture of flame retardant additives was necessary to achieve a V-0 rating, the Applicant's subsequent February 16, 1999 application, Serial No. 09/250,338, and subsequent Cameron Applications do not mention graphite and do not disclose that graphite was necessary to achieve a V-0 rating. In direct contradiction to their representations in the Truong Application, the Applicants represented in the Cameron Applications that only a single flame retardant additive was required to obtain the preferred results: Flame retardancy may be imparted by loading the emulsion with ... one or more conventional flame retardant additives such as aluminum hydrate, antimony trioxide, phosphate esters, or halogenated compounds such as polybrominated diphenyl oxides. (`393 patent, Col. 6 lines 59-63). u. Further, despite Applicant's representation in the Truong Application regarding Applicant's Test Results, their subsequent February 16, 1999 application, Serial No. 09/250,338, and subsequent Cameron Applications do not disclose that formulations without graphite failed to achieve a V-0 rating. v. The Test Results are inconsistent with the Cameron Applications that describe "preferred formulations" without mentioning either graphite or that a three-part formulation was critical for UL-V0 rating. The Test Results were undisclosed even - 12 -

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though the Cameron Applications included at least three issued claims directed to the chemical composition of the interior layer: wherein said one or more flame retardant additives are selected from the group consisting of aluminum hydrate, antimony trioxide, phosphate esters, and halogenated compounds (`348 patent claim 18; `536 patent claim 9; and `095 patent claim 9). w. The disclosure of the three-part formulation in the Truong Application and the Test Results should have been disclosed to the Examiner in the Cameron Applications, because such information would have been considered important by a reasonable examiner in determining issues of patentability, including whether Applicants had met the enablement and best mode requirements of 35 U.S.C. §112. x. In an August 7, 2001 Office Action in the Truong Application, The Patent Office rejected all pending claims in view of a prior art patent to Petras, U.S. Patent No. 4,061,826 (hereinafter "the Petras Prior Art"). The Petras Prior Art discloses the use of both halogenated and a metal oxide flame retardant additives in a coating to impart flame retardance to an EMI shielding material. Examiner Truong explained: Claims 1-27 are rejected under 35 U.S.C. § 103(a) as being unpatentable over Petras et al in view of Krassowski ... Petras discloses halogen containing flame retardant pressure sensitive adhesive tapes can be used to cover certain magnet wire wound components of electrical or electronic equipment. ... The reference further discloses othe [sic] additives ... such as antimony oxide. On January 25, 2002, Molnar filed an Amendment and Response in which he distinguished the Petras Prior Art on the sole basis that it does not disclose the graphite component of the flame-retardant composition. y. In view of the fact that another examiner had rejected claims in a related application based on the Petras Prior Art, Petras was clearly material information to the - 13 -

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prosecution of the Cameron Applications that should have been disclosed to the PTO. Petras was not cumulative to any other information before the Examiner, and it discloses EMI shielding material with flame retardance imparted by a coating that includes halogenated and metal oxides flame retardant additives as claimed in at least some of the pending and issued claims of the Cameron Applications.. z. The Petras Prior Art was never disclosed in the Cameron Applications. aa. Despite the materiality of the Truong Application, the Test Results, and the Petras Prior Art, Applicants did not disclose this material information. Upon information and belief, Applicants failures to disclose the Truong Application, the Test Results, and the Petras Prior Art, were done with deceptive intent, or, at least, with such gross negligence as to be equivalent to deceptive intent. bb. Each of the Parker Patents is unenforceable in view of the conduct set forth above. Each of the breaches of the Applicants' duty of good faith and candor, individually and collectively, constitute a basis for rendering unenforceable each of the Parker Patents, and the totality of Applicants' conduct demonstrates inequitable conduct. Each Parker Patent after the first is further unenforceable in view of the infectious unenforceability of the inequitable conduct during the course of the prosecution of the Cameron Applications. RESERVATION OF RIGHTS 19. Schlegel is still investigating this matter and has not yet had an

opportunity to conduct any discovery, and therefore reserves the right to raise such additional defenses as may be appropriate upon further investigation and discovery.

COUNTERCLAIM
Counterclaimant, Schlegel Electronic Materials, Inc. ("Schlegel"), as and for its - 14 -

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counterclaim against counter-defendant, Parker-Hannifin Corporation ("Parker"), hereby alleges as follows: 20. Schlegel is a corporation organized and existing under the laws of the

State of Delaware, having its principle place of business at 806 Linden Avenue, Suite 100, Rochester, New York 14602. 21. As Parker admits in paragraph 1 of its complaint, Parker is a corporation

organized and existing under the laws of the State of Ohio having a principal place of business at 6035 Parkland Blvd., Cleveland Ohio. JURISDICTION AND VENUE 22. As Parker admits in paragraph 3 of its complaint, jurisdiction in this Court

is proper pursuant to 28 U.S.C. §§ 1331 and 1338(a). Jurisdiction over the declaratory judgment counterclaims is also proper under 28 U.S.C. § 2201. 23. As Parker admits in paragraph 4 of its complaint, venue is proper in this

Court pursuant to 28 U.S.C. §§ 1391(b) and (c), and 1400(b). SCHLEGEL'S PATENTS 24. On September 3, 1991, United States Letter Patent No. 5,045,635 (the '635

patent) (attached hereto as Exhibit "A") was duly and legally issued. The '635 patent is owned by Schlegel. 25. On April 14, 1992, United States Letter Patent No. 5,105,056 (the '056

patent) (attached hereto as Exhibit "B") was duly and legally issued. The '056 patent is owned by Schlegel.
SCHLEGEL'S ALLEGATIONS OF INFRINGEMENT

26. patent.

Parker has been and still is infringing one or more claims of the `635

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27. patent. 28.

Parker has been and still is infringing one or more claims of the `056

Parker's infringing activities have included direct infringement,

contributory infringement and/or active inducement of infringement within the meaning of 35 U.S.C. §§ 271(a) through (c). 29. Parker has committed the acts of infringement in disregard of Schlegel's

rights in Schlegel's `635 and `056 patents. Upon information and belief, Parker's infringement has been willful, deliberate and intentional, and will continue, to Schlegel's irreparable harm, unless enjoined by this Court.
DECLARATION OF INVALIDTY

30.

Upon information and belief, the claims of Parker's `523, `348, `536, `095,

and `393 patents are invalid for failure to satisfy the requirements of the United States patent laws, 35 U.S.C. §§ 101 et seq., including but not limited to 35 U.S.C. §§ 101, 102, 103, and 112. DECLARATION OF UNENFORCEABILITY 31. Upon information and belief, the Parker Patents are unenforceable for the

reasons detailed in ¶ 18 of the Affirmative Defense set forth above and incorporated here by reference.

WHEREFORE, Schlegel prays as follows: A. That Parker take nothing by reason of its Complaint, and that judgment be entered for Schlegel;

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B. That Parker's `523, `348, `536, `095, and `393 patents and each and every claim thereof be adjudged to be and declared invalid and unenforceable, and that Schlegel be adjudged not to infringe such patent; C. That the Court declare this an exceptional case and award Schlegel its attorneys' fees and costs pursuant to 35 U.S.C. § 285; D. That Parker has infringed Schlegel's `635 and `056 patents; E. That Parker be permanently enjoined from further conduct which infringes Schlegel's `635 and `056 patents; F. That Schlegel be awarded damages adequate to compensate it for Parker's infringement, and that the damages be trebled because of the willful nature of Parker's infringement, together with interest, pursuant to 35 U.S.C. § 284; and G. That the Court grant such other and further relief as is just and proper.

Dated: December 18, 2007

WOMBLE CARLYLE SANDRIDGE & RICE, PLLC By: s/ George Pazuniak George Pazuniak (DE # 478) James M. Lennon (DE # 4570) Martina Tyreus (DE # 4771) 222 Delaware Avenue, Suite 1501 Wilmington, DE 19801 (302) 252-4320

Of Counsel: Dan O'Brien, Esq. Woods Oviatt Gilman LLP 700 Crossroads Bldg 2 State Street Rochester, NY 14614 Attorneys for Defendant/Counterclaimant SCHLEGEL ELECTRONIC MATERIALS, INC.

WCSR 3801292v1

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

PARKER-HANNIFIN CORPORATION, and PARKER INTANGIBLES, LLC Plaintiff, v. SCHLEGEL ELECTRONIC MATERIALS, INC., Defendant. SCHLEGEL ELECTRONIC MATERIALS, INC., Counterclaimant, v. PARKER-HANNIFIN CORPORATION, Counter-Defendant.

) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )

C.A. No. 1:07-cv-266 JURY TRIAL DEMANDED

AMENDED ANSWER AND COUNTERCLAIM OF DEFENDANT

SCHLEGEL ELECTRONIC MATERIALS, INC.
Defendant Schlegel Electronic Materials, Inc. ("Schlegel") hereby answers the Complaint of Plaintiff Parker-Hannifin Corporation and Parker Intangibles, LLC (collectively "Parker") as follows: 1. Schlegel lacks knowledge or information sufficient to form a belief as to

the truth of the allegations contained in Paragraph 1 of the Complaint. 2. Schlegel lacks knowledge or information sufficient to form a belief as to

the truth of the allegations contained in Paragraph 2 of the Complaint.

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3.

Schlegel denies that it is a corporation organized and existing under the

laws of the State of New York, and denies that its principle place of business is 1555 Jefferson Road, but admits the remaining allegations contained in Paragraph 3 of the Complaint. JURISDICTION AND VENUE 4. Schlegel admits subject matter jurisdiction of this Court as alleged in

Paragraph 4 of the Complaint and waives objection to personal jurisdiction. 5. Schlegel waives objection to venue of this Court as alleged in Paragraph 5

of the Complaint. PARKER-HANNIFIN'S PATENTS 6. Schlegel admits that U.S. Patent No. 6,387,523 ("the '523 patent") issued

on May 14, 2002, but denies that it was duly and legally issued. Schlegel denies that Parker has standing to assert the '523 patent. Schlegel is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations contained in paragraph 6 of the Complaint. 7. Schlegel admits that U.S. Patent No. 6,521,348 ("the '348 patent") issued

on February 18, 2003, but denies that it was duly and legally issued. Schlegel denies that Parker has standing to assert the '348 patent. Schlegel is without information or knowledge sufficient to form a belief as to the truth of the remaining allegations contained in paragraph 7 of the Complaint. 8. Schlegel admits that U.S. Patent No. 6,716,536 ("the '536 patent") issued

on April 6, 2004, but denies that it was duly and legally issued. Schlegel denies that Parker has standing to assert the '536 patent. Schlegel is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations -2-

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contained in paragraph 8 of the Complaint. 9. Schlegel admits that U.S. Patent No. 6,777,095 ("the '095 patent") issued

on August 17, 2004, but denies that it was duly and legally issued. Schlegel denies that Parker has standing to assert the '095 patent. Schlegel is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations contained in paragraph 9 of the Complaint. 10. Schlegel admits that U.S. Patent No. 6,248,393 ("the '393 patent") issued

on June 19, 2001, but denies that it was duly and legally issued. Schlegel denies that Parker has standing to assert the '393 patent. Schlegel is without knowledge or information sufficient to form a belief as to the truth of the remaining allegations contained in paragraph 10 of the Complaint. PARKER-HANNIFIN'S ALLEGATIONS OF INFRINGEMENT 11. Complaint. 12. Complaint. SCHLEGEL'S AFFIRMATIVE DEFENSES 13. Upon information and belief, Schlegel has not infringed and is not Schlegel denies each and every allegation of Paragraph 12 of the Schlegel denies each and every allegation of Paragraph 11 of the

infringing any claim of Parker's `523, `348, `536, `095, and `393 patents, either directly or by inducing or contributing to their infringement by others. 14. Upon information and belief, the claims of Parker's `523, `348, `536, `095,

and `393 patents are invalid for failure to satisfy the requirements of the United States patent laws, 35 U.S.C. §§ 101 et seq., including but not limited to 35 U.S.C. §§ 101, 102, 103, and 112. -3-

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15.

Upon information and belief, Parker's `523, `348, `536, `095, and `393

patents are invalid as a result of obviousness-type double patenting. 16. Upon information and belief, Parker is estopped by virtue of amendments

and statements made during the course of prosecution of Parker's `523, `348, `536, `095, and `393 patents from obtaining any construction of the claims of these patents that could cover any of Schlegel's products and the methods by which those products are made. 17. On information and belief, Parker and Parker Intangibles LLC have failed

to comply with the provisions of 35 U.S.C. § 287(a) and are therefore barred from recovery of any damages prior to service of the Complaint. 18. Upon information and belief, Parker's `523, `348, `536, `095, and `393

patents ("Parker Patents") are unenforceable, because of at least three instances of inequitable conduct by applicants in the United States Patent and Trademark Office ("PTO" or "Patent Office"), each of which separately, independently and collectively establishes a basis for unenforceability. The particular bases for the inequitable conduct defenses are as follows: a. Erma Cameron was the PTO examiner ("Examiner Cameron") for all of the applications leading to the Parker Patents (hereinafter called the applications leading to, and the resultant, Parker Patents are collectively referred to as the "Cameron Applications"). b. John A. Molnar, Jr. ("Molnar") was the prosecuting attorney for each of the Cameron Applications, c. Michael H. Bunyan ("Bunyan") and William I. Flanders ("Flanders") are the named inventors in each of the Cameron Applications.

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d. Upon information and belief, Molnar, Bunyan, and Flanders were at all times during the prosecution of these applications employed by Parker Hannifin Corporation. e. The history and relationship of the Cameron Applications is as follows: The `393 patent issued on June 19, 2001 as the result of patent application No. 09/250,338 filed on February 16, 1999 claiming priority from provisional application No. 60/076,370 filed on February 27, 1998. The `523 patent issued on May 14, 2002 as the result of patent application No. 09/883,785 filed on June 18, 2001 as a continuation of the above patent application No. 09/250,338 filed on February 16, 1999, now U.S. Pat. No. 6,248,393, and claiming priority from provisional application No. 60/076,370 filed on February 27, 1998. The `348 patent issued on February 18, 2003 as the result of patent application No. 10/142,803 filed on May 9, 2002 as a continuation of application No. 09/883,785, filed on June 18, 2001, now Pat. No. 6,387,523, which is a continuation of application No. 09/250,338, filed on February 16, 1999, now Pat. No. 6,428,393, which claims priority from provisional application No. 60/076,370 filed on February 27, 1998. The `536 patent issued April 6, 2004 as the result of patent application No. 10/318,609 filed on December 11, 2002 as a continuation of application No. 10/142,803, filed on May 9, 2002, now Pat. No. 6,521,348, which is a continuation of application No. 09/883,785, filed on June 18, 2001, now Pat. No. 6,387,523, which is a continuation of application No. 09/250,338, filed on February 16, 1999, now Pat. No. 6,248,393, which claims priority from provisional application No. 60/076,370 filed on February 27, 1998. The `095 patent issued August 17, 2004 as the result of patent application No.

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10/753,016 filed on January 7, 2004 as a continuation of application No. 10/318,609, filed on December 11, 2002, now Pat. No. 6,716,536, which is a continuation of application No. 10/142,803, filed on May 9, 2002, now Pat. No. 6,521,348, which is a continuation of application No. 09/883,785, filed on June 18, 2001, now Pat. No. 6,387,523, which is a continuation of application No. 09/250,338, filed on February 16, 1999, now Pat. No. 6,248,393, which claims priority from provisional application No. 60/076,370 filed on February 27, 1998. The application sequence is shown in the following chart: Provisional Patent App. Serial No. 60/076,370 Filed Feb. 27, 1998
|

(converted)
|

Patent App. Serial No. 09/250,338 Filed Feb. 16, 1999 (issued as `393 patent on June 19, 2001)
|

(continuation)
|

Patent App. Serial No. 09/883,785 Filed June 18, 2001 (issued as `523 patent on May 14, 2002)
|

(continuation)
|

Patent App. Serial No. 10/142,803 Filed May 9, 2002 (issued as `348 patent on Feb. 18, 2003)
|

(continuation)
|

Patent App. Serial No. 10/318,609 Filed Dec. 11, 2002 (issued as `536 patent on Apr. 6, 2004)
|

(continuation)
|

Patent App. Serial No. 10/753,016 Filed Jan. 7, 2004 (issued as `095 patent on Aug. 17, 2004) f. At the time the first Cameron Application was filed, the PTO regulations,

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37 C.F.R. § 1.56 (1992), provided in part, as follows: Section 1.56 Duty to disclose information material to patentability. (a) A patent by its very nature is affected with a public interest. The public interest is best served, and the most effective patent examination occurs when, at the time an application is being examined, the Office is aware of and evaluates the teachings of all information material to patentability. Each individual associated with the filing and prosecution of a patent application has a duty of candor and good faith in dealing with the Office, which includes a duty to disclose to the Office all information known to that individual to be material to patentability as defined in this section. The duty to disclose information exists with respect to each pending claim until the claim is cancelled or withdrawn from consideration, or the application becomes abandoned. Information material to the patentability of a claim that is cancelled or withdrawn from consideration need not be submitted if the information is not material to the patentability of any claim remaining under consideration in the application. There is no duty to submit information which is not material to the patentability of any existing claim. The duty to disclose all information known to be material to patentability is deemed to be satisfied if all information known to be material to patentability of any claim issued in a patent was cited by the Office or submitted to the Office in the manner prescribed by Secs. 1.97(b)-(d) and 1.98. However, no patent will be granted on an application in connection with which fraud on the Office was practiced or attempted or the duty of disclosure was violated through bad faith or intentional misconduct. The Office encourages applicants to carefully examine: (1) Prior art cited in search reports of a foreign patent office in a counterpart application, and (2) The closest information over which individuals associated with the filing or prosecution of a patent application believe any pending claim patentably defines, to make sure that any material information contained therein is disclosed to the Office. (b) Under this section, information is material to patentability when it is not cumulative to information already of record or being made of record in the application, and (1) It establishes, by itself or in combination with other information, a prima facie case of unpatentability of a claim; or (2) It refutes, or is inconsistent with, a position the applicant takes in: (i) Opposing an argument of unpatentability relied on by the Office, or (ii) Asserting an argument of patentability.

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A prima facie case of unpatentability is established when the information compels a conclusion that a claim is unpatentable under the preponderance of evidence, burden-of-proof standard, giving each term in the claim its broadest reasonable construction consistent with the specification, and before any consideration is given to evidence which may be submitted in an attempt to establish a contrary conclusion of patentability. (c) Individuals associated with the filing or prosecution of a patent application within the meaning of this section are: (1) Each inventor named in the application; (2) Each attorney or agent who prepares or prosecutes the application; and (3) Every other person who is substantively involved in the preparation or prosecution of the application and who is associated with the inventor, with the assignee or with anyone to whom there is an obligation to assign the application. (d) Individuals other than the attorney, agent or inventor may comply with this section by disclosing information to the attorney, agent, or inventor. g. The above provisions of Rule 56 continue to this day, and Rule 56 has been amended only to add an additional sub-section (e) [65 FR 54666, Sept. 8, 2000], which provides: (e) In any continuation-in-part application, the duty under this section includes the duty to disclose to the Office all information known to the person to be material to patentability, as defined in paragraph (b) of this section, which became available between the filing date of the prior application and the national or PCT international filing date of the continuation-in-part application. h. Hereinafter, the terms "Applicant" or "Applicants" means anyone under a duty to disclose material information to the PTO pursuant to 37 C.F.R. § 1.56, including Molnar, Bunyan, Flanders and any other person substantively involved in the preparation or prosecution of one or more of the Cameron Applications. i. On October 22, 1998, in addition to the Cameron Applications, Applicants filed provisional application No. 60/105,271. This provisional was converted into application No. 09/412,059 on October 4, 1999. The prosecuting attorney on behalf of Parker was Molnar and the named inventor is Bunyan. The PTO examiner for these -8-

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applications was Duc Truong (Examiner Troung). This application issued on June 25, 2002 as U.S. Patent No. 6,410,137 ("the `137 Patent"). Collectively this provisional, the converted application, and the `137 Patent will be referred to hereinafter as "Truong Application." j. The timeline of the Applicants' Cameron and Truong Applications is as follows:

Cameron Applications Timeline Feb. 27, 1998 Filed Provisional Patent App. Serial No. 60/076,370

Truong Application Timeline

Oct. 22, 1998 Filed Provisional Patent App. Serial No. 60/105,271

Feb. 16, 1999 Patent App. Serial No. 09/250,338 (issued as `393 patent on June 19, 2001)

Oct. 4, 1999 Patent App. Serial No. 09/250,338 (issued as `393 patent on June 25, 2002)

June 18, 2001 Filed Continuation Patent App. Serial No. 09/883,785 (issued as `523 patent on May 14, 2002) May 9, 2002 Filed continuation Patent App. Serial No. 10/142,803 (issued as `348 patent on Feb. 18, 2003) Dec. 11, 2002 Filed continuation Patent App. Serial No. 10/318,609 (issued as `536 patent on Apr. 6, 2004)

Jan. 7, 2004 Filed continuation Patent App. Serial No. 10/753,016 -9-

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(issued as `095 patent on Aug. 17, 2004)

k. The Truong Application, as filed October 22, 1998characterized the invention as follows: [T]he present invention is directed to an intumescent, flame-retardant pressure-sensitive adhesive (PSA) composition particularly adapted for use in foil or fabric-over-foam EMI shielding gasket constructions for bonding an electrically-conductive foam or fabric sheath or jacket to a polyurethane or other foam core. ... Gaskets of such construction advantageously have been observed to achieve a UL94 rating of V-0 over a range of cross-section (`137 patent, Col 3 lines 27-42). l. The above statement of the invention from the Truong Application is - 10 -

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nearly identical to the statement of the invention from the Cameron Applications: The present invention is directed to an electrically-conductive, flame retardant material for use in fabric-over-foam EMI shielding gaskets, and to a method of manufacturing the same. In having a layer of a flame retardant coating applied to one side of an electrically-conductive, generally porous fabric, the material of the invention affords UL94 V-0 protection when used as a jacketing in a fabric-over-foam gasket construction. (`393 patent, Col 3 lines 25-32). m. The Cameron Applications define "flame retardant" gaskets as those "achieving a rating of V-0 under UL Std. No. 94, 'Tests for Flammability of Plastic Materials for Parts in Devices and Appliances` (1991)" n. The Truong and Cameron Applications are both directed to an EMI shielding material that meets the Underwriters Laboratory 94 V-0 vertical burn rating standard for flame retardance ("UL 94 V-0") by applying a layer with flame retardant additives between an exterior conductive fabric/sheath and an interior foam core. o. This similarity, standing alone, makes the Truong Application material information to the prosecution of the Cameron Applications that should have been disclosed to the PTO. p. Upon information and belief, the existence of the co-pending Truong Application was never disclosed to Examiner in the Cameron Applications. q. The Truong Application further discloses that a "unique combination of flame retardant additives" is required to achieve a rating of V-0 under UL Std. No. 94. The three components of this mixture are: "a halogenated first flame retardant component, an metal oxide-based second flame retardant component, and a filler component of expandable, intercalated graphite particles." (`137 patent, Col 3 lines 52-55). - 11 -

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r. The Truong Application further teaches that it was "unexpected" that this three-part mixture was "critical" to achieve a UL 94 V-0 rating: [t]he ... results confirm that the EMI shielding material of the present invention is UL94 V-0 compliant when used as a jacketing in a fabricover-foam gasket construction. Unexpectedly, it was found that the use of a unique combination of three different flame retardant additives was critical in the use of any of the additives alone or without one of the other additives was insufficient to meet the required UL-V0 criteria. (`137 patent, Col. 12 lines 21-28). On January 25, 2002, Molnar filed an Amendment and Response in which he distinguished certain prior art on the sole basis that the prior art did not disclose the graphite component and further argued, as a basis for patentability, that: [u]nexpectedly, it has been observed that such flame retardant additive combination functions synergistic. In this regard, each of the components separately has been observed not to impart flame retardancy to the PSA composition effective to achieve UL 94 V-0 protection within a fabric or foil over foam EMI shielding gasket construction. s. The above representation in the Truong Application manifests that Applicants not only knew that a special three-part mixture was critical to achieving a ULV0 rating, but that Applicants possessed test data and results, as of October 22, 1998, which demonstrated that halogenated or metal-oxide based flame retardant additives in the interior layer between the fabric/sheath and foam, individually or in combination with each other, were insufficient to produce a product meeting the UL 94 V-0 criteria. The above data and results identified in the Truong Application is hereafter referred to as the "Test Results." t. Despite the representation in the Truong Application that a graphite-based chemical mixture of flame retardant additives was necessary to achieve a V-0 rating, the Applicant's subsequent February 16, 1999 application, Serial No. 09/250,338, and - 12 -

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subsequent Cameron Applications do not mention graphite and do not disclose that graphite was necessary to achieve a V-0 rating. In direct contradiction to their representations in the Truong Application, the Applicants represented in the Cameron Applications that only a single flame retardant additive was required to obtain the preferred results: Flame retardancy may be imparted by loading the emulsion with ... one or more conventional flame retardant additives such as aluminum hydrate, antimony trioxide, phosphate esters, or halogenated compounds such as polybrominated diphenyl oxides. (`393 patent, Col. 6 lines 59-63). u. Further, despite Applicant's representation in the Truong Application regarding Applicant's Test Results, their subsequent February 16, 1999 application, Serial No. 09/250,338, and subsequent Cameron Applications do not disclose that formulations without graphite failed to achieve a V-0 rating. v. The Test Results are inconsistent with the Cameron Applications that describe "preferred formulations" without mentioning either graphite or that a three-part formulation was critical for UL-V0 rating. The Test Results were undisclosed even though the Cameron Applications included at least three issued claims directed to the chemical composition of the interior layer: wherein said one or more flame retardant additives are selected from the group consisting of aluminum hydrate, antimony trioxide, phosphate esters, and halogenated compounds (`348 patent claim 18; `536 patent claim 9; and `095 patent claim 9). w. The disclosure of the three-part formulation in the Truong Application and the Test Results should have been disclosed to the Examiner in the Cameron Applications, because such information would have been considered important by a - 13 -

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reasonable examiner in determining issues of patentability, including whether Applicants had met the enablement and best mode requirements of 35 U.S.C. §112. x. In an August 7, 2001 Office Action in the Truong Application, The Patent Office rejected all pending claims in view of a prior art patent to Petras, U.S. Patent No. 4,061,826 (hereinafter "the Petras Prior Art"). The Petras Prior Art discloses the use of both halogenated and a metal oxide flame retardant additives in a coating to impart flame retardance to an EMI shielding material. Examiner Truong explained: Claims 1-27 are rejected under 35 U.S.C. § 103(a) as being unpatentable over Petras et al in view of Krassowski ... Petras discloses halogen containing flame retardant pressure sensitive adhesive tapes can be used to cover certain magnet wire wound components of electrical or electronic equipment. ... The reference further discloses othe [sic] additives ... such as antimony oxide. On January 25, 2002, Molnar filed an Amendment and Response in which he distinguished the Petras Prior Art on the sole basis that it does not disclose the graphite component of the flame-retardant composition. y. In view of the fact that another examiner had rejected claims in a related application based on the Petras Prior Art, Petras was clearly material information to the prosecution of the Cameron Applications that should have been disclosed to the PTO. Petras was not cumulative to any other information before the Examiner, and it discloses EMI shielding material with flame retardance imparted by a coating that includes halogenated and metal oxides flame retardant additives as claimed in at least some of the pending and issued claims of the Cameron Applications.. z. The Petras Prior Art was never disclosed in the Cameron Applications. aa. Despite the materiality of the Truong Application, the Test Results, and the Petras Prior Art, Applicants did not disclose this material information. Upon - 14 -

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information and belief, Applicants failures to disclose the Truong Application, the Test Results, and the Petras Prior Art, were done with deceptive intent, or, at least, with such gross negligence as to be equivalent to deceptive intent. bb. Each of the Parker Patents is unenforceable in view of the conduct set forth above. Each of the breaches of the Applicants' duty of good faith and candor, individually and collectively, constitute a basis for rendering unenforceable each of the Parker Patents, and the totality of Applicants' conduct demonstrates inequitable conduct. Each Parker Patent after the first is further unenforceable in view of the infectious unenforceability of the inequitable conduct during the course of the prosecution of the Cameron Applications. RESERVATION OF RIGHTS 18.19. Schlegel is still investigating this matter and has not yet had an opportunity to conduct any discovery, and therefore reserves the right to raise such additional defenses as may be appropriate upon further investigation and discovery.

COUNTERCLAIM
Counterclaimant, Schlegel Electronic Materials, Inc. ("Schlegel"), as and for its counterclaim against counter-defendant, Parker-Hannifin Corporation ("Parker"), hereby alleges as follows: 19.20. Schlegel is a corporation organized and existing under the laws of the State of Delaware, having its principle place of business at 806 Linden Avenue, Suite 100, Rochester, New York 14602. 20.21. As Parker admits in paragraph 1 of its complaint, Parker is a corporation organized and existing under the laws of the State of Ohio having a principal place of business at 6035 Parkland Blvd., Cleveland Ohio. - 15 -

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JURISDICTION AND VENUE 21.22. As Parker admits in paragraph 3 of its complaint, jurisdiction in this Court is proper pursuant to 28 U.S.C. §§ 1331 and 1338(a). Jurisdiction over the declaratory judgment counterclaims is also proper under 28 U.S.C. § 2201. 22.23. As Parker admits in paragraph 4 of its complaint, venue is proper in this Court pursuant to 28 U.S.C. §§ 1391(b) and (c), and 1400(b). SCHLEGEL'S PATENTS 23.On August 15, 1989, United States Patent Letter No. 4,857,668 (the '668 patent) (attached hereto as Exhibit "A") was duly and legally issued. The '668 patent is owned by Schlegel. 24. On September 3, 1991, United States Letter Patent No. 5,045,635 (the '635

patent) (attached hereto as Exhibit "BA") was duly and legally issued. The '635 patent is owned by Schlegel. 25. On April 14, 1992, United States Letter Patent No. 5,105,056 (the '056

patent) (attached hereto as Exhibit "CB") was duly and legally issued. The '056 patent is owned by Schlegel.
SCHLEGEL'S ALLEGATIONS OF INFRINGEMENT

26.Parker has been and still is infringing at least claim 16 of the `668 patent. 27.26. Parker has been and still is infringing one or more claims of the `635 patent. 28.27. Parker has been and still is infringing one or more claims of the `056 patent. 29.28. Parker's infringing activities have included direct infringement, contributory infringement and/or active inducement of infringement within the meaning - 16 -

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of 35 U.S.C. §§ 271(a) through (c). 30.29. Parker has committed the acts of infringement in disregard of Schlegel's rights in Schlegel's `668, `635, and `056 patents. Upon information and belief, Parker's infringement has been willful, deliberate and intentional, and will continue, to Schlegel's irreparable harm, unless enjoined by this Court.
DECLARATION OF INVALIDTY

31.30. Upon information and belief, the claims of Parker's `523, `348, `536, `095, and `393 patents are invalid for failure to satisfy the requirements of the United States patent laws, 35 U.S.C. §§ 101 et seq., including but not limited to 35 U.S.C. §§ 101, 102, 103, and 112. DECLARATION OF UNENFORCEABILITY 31. Upon information and belief, the Parker Patents are unenforceable for the

reasons detailed in ¶ 18 of the Affirmative Defense set forth above and incorporated here by reference.

WHEREFORE, Schlegel prays as follows: A. That Parker take nothing by reason of its Complaint, and that judgment be entered for Schlegel; B. That Parker's `523, `348, `536, `095, and `393 patents and each and every claim thereof be adjudged to be and declared invalid and unenforceable, and that Schlegel be adjudged not to infringe such patent;

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C. That the Court declare this an exceptional case and award Schlegel its attorneys' fees and costs pursuant to 35 U.S.C. § 285; D. That Parker has infringed Schlegel's `668, `635, and `056 patents; E. That Parker be permanently enjoined from further conduct which infringes Schlegel's `668, `635, and `056 patents; F. That Schlegel be awarded damages adequate to compensate it for Parker's infringement, and that the damages be trebled because of the willful nature of Parker's infringement, together with interest, pursuant to 35 U.S.C. § 284; and G. That the Court grant such other and further relief as is just and proper.

Dated: December 18September 10, 2007

WOMBLE CARLYLE SANDRIDGE & RICE, PLLC By: s/ George Pazuniak George Pazuniak (DE # 478) James M. Lennon (DE # 4570) Martina Tyreus (DE # 4771) 222 Delaware Avenue, Suite 1501 Wilmington, DE 19801 (302) 252-4320

Of Counsel: Dan O'Brien, Esq. Woods Oviatt Gilman LLP 700 Crossroads Bldg 2 State Street Rochester, NY 14614 Attorneys for Defendant/Counterclaimant SCHLEGEL ELECTRONIC MATERIALS, INC.

WCSR 3799752v6

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EXHIBIT A ('635 Patent) to EXHIBIT 1 (Amended Answer and Counterclaim of Schlegel)

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EXHIBIT B ('056 Patent) to EXHIBIT 1 (Amended Answer and Counterclaim of Schlegel)

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Case 1:07-cv-00266-MPT

Document 29-5

Filed 12/18/2007

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