Holding: A communication that requires written acceptance by the offeror does not prohibit the offer from being a commercial offer for sale, the communication should be reviewed as a whole. An offer for sale originating from a foreign country but directed to an American entity at its United States place of business qualifies as an offer “made in this country” as required by pre-AIA Section 102(b).
Crown Packaging, a corporation based in England, owns several United States patents related to necking machines that are used to reduce the diameter of metal beverage cans. Crown sued Belvac for infringement of a total of three of its patents. Belvac alleged that the patents are invalid, asserting that Crown had sold, in the United States, a necking machine that embodied the asserted claims of these patents before the critical date of the patents.
The critical date for the on-sale bar for the Crown patents is April 24, 2007. On November 14, 2006, Crown sent a letter to a third party based in Colorado, Complete Packaging Machinery titled “Quotation Number Q22764” and including a description and price for a 13 stage 3400 Die Necker machine. The letter further specified delivery to Complete’s nominated point of delivery or at Crown’s premises, and included payment terms and an estimated delivery time upon receipt of the order. The district court found that the letter was an invitation to make an offer, and not an offer in itself, and therefore did not create an on-sale bar.
The Federal Circuit reversed the district court’s decision, finding the letter to Complete to be an invalidating offer for sale in this country prior to the critical date of the patents under pre-AIA Section 102(b). Pre-AIA Section 102(b) requires that the (1) subject of an offer for sale embody the claims of the asserted patent; (2) the offer for sale occurred within the United States; and (3) the offer for sale occurred before the critical date of the asserted patent. The Supreme Court’s decision in Pfaff v. Wells Electronics, Inc., 525 U.S. 55 (1998) further states that the invention must also be (4) the subject of a commercial offer for sale and (5) ready for patenting. Both parties agreed that the Crown necking machine was ready for patenting at the time the letter was sent to Complete and that the necking machine embodied the claimed invention.
For the purpose of Section 102(b), a proposed offer qualifies as an offer for sale as long as the offer is sufficiently definite to allow the other party to make a binding contract by simple acceptance. Despite the fact that Crown’s letter was titled as a “Quotation” and not specifically labeled as an offer, the label used on the communication is not controlling. Instead, the court examines the specific terms of the alleged offer for sale. In finding that Crown’s letter was an offer for sale, the Federal Circuit cited several factors. First, the quotation was not widely disseminated, but instead sent specifically to Complete and signed by Crown’s representative. Additionally, the text of the letter itself stated that it was an “offer.” The letter also provided a detailed description of the machine and the price and the terms for payment. The letter also included delivery terms and additional conditions of sale. The Federal Circuit found that all of these terms made Crown’s letter sufficiently definite to qualify as an offer for sale under Section 102(b).
The fact that the letter required Crown’s written acceptance of the order does not prevent the letter from being a commercial offer for sale. Complete was obligated to pay half of the purchase price immediately with receipt of the order, and the indication that Crown would have the necking machine ready 30 weeks after receipt of the order indicated that Crown would fill requests upon order. Additionally, for other similar letters sent to third parties, Crown did not send back acceptance of the orders, but instead sent back order acknowledgments, implying that the order was effective on receipt.
Crown also argued that its letter did not qualify as an offer “made in this country” as required for the pre-AIA Section 102(b), since Crown sent the letter from England. However, a commercial offer for sale made by a foreign entity directed to a United States customer at its place of business in the United States can trigger the on-sale bar. Crown sent the letter to Complete at its address in Arvada, Colorado, so the letter represents an offer for sale in the United States.
Federal Circuit Precedential 
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