March 2011
Burden of Proof for Infringement Under the DOE Is Not Heightened in Cases of Separate Patentability
| Judges: Lourie (author), Linn, Prost (dissenting) |
| [Appealed from D. Del., Judge Robinson] |
In Siemens Medical Solutions USA, Inc. v. Saint-Gobain Ceramics & Plastics, Inc., Nos. 10-1145,
-1177 (Fed. Cir. Feb. 24, 2011), the Federal Circuit affirmed the district court’s denial of a motion by
Saint-Gobain Ceramics & Plastics, Inc. (“Saint-Gobain”) for JMOL or a new trial based on erroneous jury instructions and excluded evidence. The Court also vacated and remanded on the issue of damages.
Siemens Medical Solutions USA, Inc. (“Siemens”) owns U.S. Patent No. 4,958,080 (“the ’080 patent”), which is directed to radiation detectors comprising a lutetium oxyorthosilicate (“LSO”) crystal. The radiation detectors are used in positron emission tomography (“PET”) scanners. Siemens sued
Saint-Gobain for contributory and induced infringement of the ’080 patent based on Saint-Gobain’s sale of lutetium-yttrium orthosilicate (“LYSO”) crystals to Philips Medical Systems (“Philips”) for use in PET scanners.
Saint-Gobain moved for JMOL or a new trial after the jury awarded Siemens $52.3 million in damages for infringement under the DOE. The district court denied Saint-Gobain’s motion but reduced the jury award to over $44.9 million, because the sale of some of the scanner products was “wholly speculative.” The parties appealed and cross-appealed.
Saint-Gobain challenged the district court’s jury instructions with regard to the burden of proof; its jury instructions with regard to the presumption of validity of U.S. Patent No. 6,624,420 (“the ’420 patent”), which is licensed to Saint-Gobain; its decision to exclude certain evidence; and its decision to permit the jury to consider lost profit damages. Siemens argued that the damages challenged the district court’s reduction of the jury’s damages award.
On appeal, the Federal Circuit took each of Saint-Gobain’s and Siemens’s challenges in turn. With regard to the jury instructions, the Court held that the district court did not err in instructing that infringement may be proved by a preponderance of the evidence, even in cases of separate patentability. The Court reasoned that “separate patentability, while potentially relevant to the equivalence issue and deserving of due weight in the infringement analysis, does not merit a heightened evidentiary burden.” Slip op. at 15. The Court noted that finding equivalence does not constructively invalidate a separate patent for being obvious, because of the validity presumption and the differences between equivalence and obviousness.
“[S]eparate patentability, while potentially relevant to the equivalence issue and deserving of due weight in the infringement analysis, does not merit a heightened evidentiary burden.” Slip op. at 15.
The Federal Circuit also held that the district court did not err in not instructing the jury that the ’420 patent was presumed valid. The Court reasoned that the ’080 patent’s validity was not at issue and that an infringement verdict would not affect the ’420 patent’s validity. The Court further noted that the instructional video and subsequent testimony provided the jury with notice of the validity presumption.
With regard to the excluded evidence, the Federal Circuit held that the district court did not err in excluding U.S. Patent No. 6,323,489 (“the ’489 patent”). The Court reasoned that Saint-Gobain used their license of the ’489 patent as evidence, and only after the trial did Saint-Gobain argue that the ’489 patent was relevant to the patentability of LYSO crystals. The Court noted that any error associated with the district court’s ruling was harmless, because the ’489 patent would have been largely cumulative of evidence of record, and because the jury was presented with a text reference to the issuance of the ’489 patent and an image of the patent itself.
The Federal Circuit also held that the district court did not err in excluding testimony by Saint-Gobain’s expert regarding the use of LYSO crystals in other applications, because the expert could not testify on matters not disclosed in his expert report or deposition, and could not rely on testing that was not disclosed during discovery.
With regard to lost profits damages, the Federal Circuit held that the district court did not err in permitting the jury to make an award as it was based on substantial evidence.
Regarding Siemen’s cross-appeal, the Federal Circuit held that the district court did not err in reducing the jury’s damages award as the evidence did not suggest that Philips sold the additional scanners. The Court held, however, that the district court erred by failing to consider any damages on the additional scanners, because the evidence indicated that Philips made them. The Federal Circuit stated that a district court that “eliminates a lost profits award with regard to a portion of the infringing devices . . . must then determine an appropriate measure of damages for that portion.” Id. at 32. The Court vacated and remanded on the issue of damages from the additional scanners that were made.
In a dissenting opinion, Judge Prost stated that the jury instructions should have addressed the overlap between the tests for obviousness and equivalence. Specifically, Judge Prost stated that the district court erred in not instructing the jury that it could find equivalence if, and only if, the state of the art had advanced from the time of the ’420 patent’s invention to the time of the alleged infringement.
