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District Court Has Authority to Clarify Claim Construction Following Jury Verdict

10-1311
September 28, 2011

Decision icon Decision

Last Month at the Federal Circuit - October 2011

Judges: Bryson, Mayer, Gajarsa (author)

[Appealed from: D. Del., Judge Robinson]

In Cordis Corp. v. Boston Scientific Corp., Nos. 10-1311, -1316 (Fed. Cir. Sept. 28, 2011), the Federal Circuit affirmed the district court’s grant of JMOL that Boston Scientific Corporation and Boston Scientific Scimed, Inc. (collectively “BSC”) do not literally infringe U.S. Patent No. 5,879,370 (“the ’370 patent”) and that the ’370 patent and U.S. Patent No. 5,643,312 (“the ’312 patent”) are not unenforceable due to inequitable conduct.

Cordis Corporation (“Cordis”) owns the ’312 and ’370 patents, which relate to balloon-expandable coronary stents, having undulating longitudinal sections, used to treat occluded blood vessels. Robert Fischell prosecuted the application issuing as the ’312 patent pro se. He retained an attorney, Morton Rosenberg, to prosecute foreign counterparts. During prosecution of the ’312 patent, Rosenberg sent Fischell an EPO Search Report regarding a European counterpart to the ’312 patent. The EPO Search Report identified and categorized six references, where “category X” documents were “particularly relevant if taken alone,” and “category Y” documents were “particularly relevant if combined with another document of the same category.” Slip op. at 3 (citation omitted). Although U.S. Patent No. 4,856,516 (“Hillstead”), one of the four Y references, was directed to a stent “constructed from an elongated wire bent to define a series of relatively tightly spaced convolutions or bends,” Mr. Rosenberg’s accompanying letter focused on the X reference. Id. at 4.

In the course of the case, Fischell testified that it was his practice to “look at the pictures and see if the pictures [in the references] look like the invention.” Id. at 5 (alteration in original) (citation omitted). Rosenberg testified that his practice was to “carefully” review the “X” references in EPO search reports, but to “just scan” “Y” references. Rosenberg and Fischell, however, testified that they did not recall looking at Hillstead until April 1998, even though it was in the EPO Search Report and their files since at least July 1995. Hillstead was not disclosed to the PTO during prosecution of the ’312 patent, but was disclosed in an IDS while prosecuting the ’370 patent, which issued from a continuation application from the ’312 patent application. Hillstead was one of about seventy references disclosed in the IDS, and the IDS did not emphasize Hillstead as being of particular interest.

Cordis sued BSC for infringing the ’370 and ’312 patents. A jury found some of the asserted claims invalid and others not invalid. It also found no literal infringement of some claims, and no infringement of other claims by virtue of the reverse DOE. The parties moved for JMOL, and the district court granted BSC’s motion for JMOL of no literal infringement, denied Cordis’s motion for JMOL on the reverse DOE as moot, and denied BSC’s JMOL of invalidity. Finally, following a separate bench trial, the district court held both patents unenforceable due to inequitable conduct in light of Hillstead.

On appeal, the Federal Circuit affirmed the district court’s holding that the ’370 patent was not invalid, and agreed that the Hillstead reference was material, but remanded for additional findings regarding intent to deceive. On remand, the district court found that BSC failed to prove (1) deceptive intent and (2) that the nondisclosure of Hillstead during the ’312 patent prosecution carried over and affected the later ’370 patent, by clear and convincing evidence, and thus reversed the inequitable conduct judgment. The district court also denied BSC’s motion for reconsideration. Cordis appealed the district court’s JMOL grant of no literal infringement and denial of JMOL on the issue of noninfringement by the reverse DOE, and BSC cross-appealed the district court’s finding that the ’312 and ’370 patents are not unenforceable due to inequitable conduct.

On appeal, the Federal Circuit first considered claim 25 of the ’370 patent, the only claim-at-issue with respect to the JMOL of no infringement. Claim 25 covers a predeployment balloon-expandable stent wherein “the undulating section of each closed perimeter cell comprises a ‘U’ shaped curve.” Id. at 10 (citation omitted). The district court construed “undulating” according to BSC’s proposed construction to mean “rising and falling in waves, thus having at least a crest and a trough.” Id. at 11 (citation omitted). The district court later clarified that its “use of the plural ‘waves’ implies a change in direction” and entered JMOL of noninfringement. Id. (citation omitted). Cordis’s appeal raised two challenges: (1) that BSC improperly urged a narrower and erroneous claim construction on the district court after the court had construed the claims; and (2) even if the district court’s claim construction did imply “arcing curves” and “a change in direction,” a reasonable jury could find that BSC’s stent infringed claim 25. Id. at 11-12.

Addressing Cordis’s first challenge, the Federal Circuit found no error in the district court’s post-jury-verdict clarification regarding whether the terms “crest” and “trough” implicated changes of direction. “No rule of law restricted BSC from seeking to clarify or defend the original scope of its claim construction.” Id. at 12. The Court indicated that it was apparent that the construction requires multiple “waves,” and the terms “crest” and “trough” implicate changes of direction. “The district court’s post-verdict elaboration on this point only clarified what was inherent in the construction. Doing so was not error; it merely made plain what . . . should have been obvious to the jury.” Id. at 13.

Further, the Court indicated that Cordis could not plead surprise at the trial court’s clarification because, during claim construction, BSC specifically pointed to arguments made during the prosecution of the ’312 patent in which Fischell distinguished the claimed “undulating” structures from those that were merely curved; thus, “Cordis’s suggestion that a single curve can satisfy the ‘undulating’ limitation of the asserted claims was thereby foreclosed.” Id. at 14.

The Federal Circuit similarly rejected Cordis’s second challenge, finding that since Cordis’s expert’s testimony was based on an incorrect claim construction, it should be disregarded. Thus, “absent the testimony of Cordis’s expert regarding troughs and crests, and the corresponding testimony concluding infringement, [the Court found] very little evidence to support the jury’s verdict that claim 25 was literally infringed.” Id. at 17-18. Accordingly, the Court affirmed the district court’s grant of JMOL of no literal infringement and declined to reach the issue of noninfringement by the reverse DOE.

Addressing BSC’s cross-appeal, the Federal Circuit first rejected BSC’s argument that Cordis waived any challenge to the district court’s initial inequitable conduct finding with respect to the ’312 patent because the Court can address waived issues “when they are necessary to the resolution of other issues directly before it on appeal.” Id. at 18. In this instance, the “enforceability of the two patents [was] inextricably linked” because “the enforceability of the ’312 patent [was] a predicate issue necessary to [the] determination of the enforceability of the ’370 patent” under BSC’s taint theory of inequitable conduct. Id. at 19.

The Court similarly rejected BSC’s additional arguments, finding no error in the district court’s decision to issue supplemental findings of fact and no clear error in the findings themselves. The district court found that Rosenberg’s letter forwarding the EPO Search Report called attention to a different reference, not Hillstead, and that when Hillstead was later brought to Fischell’s attention, he promptly disclosed it to the PTO. Although Fischell did not emphasize Hillstead in the IDS he submitted, the district court found that Fischell had relied on Rosenberg’s advice. Thus, the Federal Circuit noted that “[t]his appears to be a case where BSC proved the threshold level of intent to deceive, but that proof was rebutted by . . . Fischell’s good faith explanation.” Id. at 23 n.6 (citing Therasense, Inc. v. Benton, Dickinson & Co., ---F.3d---, 2011 WL 2028255, at *10 (Fed. Cir. May 25, 2011) (en banc)). Further, while the Court found “substantial evidence calling into question” Fischell’s veracity, the Court “gives great deference to the district court’s decisions regarding credibility of witnesses.” Id. (citation omitted). Accordingly, the Federal Circuit affirmed the district court’s conclusion that BSC failed to prove inequitable conduct in the ’312 and ’370 patent prosecutions.

Summary authored by Victoria S. Lee, Esq.