By Peter Reap, J.D., LL.M.
On vacatur and remand from the U.S. Supreme Court, a reasonable jury could have inferred that Medtronic Sofamor Danek USA (“MSD”) must have known, or was willfully blind to the fact, that doctors using MSD’s “NIM-Eclipse” device were infringing the asserted claims of NuVasive’s asserted U.S. Patent No. 7,470,236 (“the ’236 patent”), the U.S. Court of Appeals for the Federal Circuit has decided (Warsaw Orthopedic, Inc. v. NuVasive, Inc., June 3, 2016, Dyk, T.). Thus, the court reaffirmed a judgment of the federal district court in San Diego with respect to the ‘236 patent and reinstated its earlier judgment in other respects.
The vacated decision began as a patent infringement suit by Warsaw Orthopedic and related company MSD (collectively, “MSD”) against NuVasive. NuVasive counterclaimed for infringement of its ‘236 patent. Only the Federal Circuit’s decision with respect to the ’236 patent was affected by the Supreme Court’s remand. That aspect of the decision affirmed a jury verdict of infringement, holding that the asserted claims of NuVasive’s ’236 patent were directly infringed by users of MSD’s “NIM-Eclipse” device and that MSD induced this infringement.
MSD subsequently petitioned for certiorari, requesting that the Court grant certiorari, vacate, and remand (“GVR”) on the basis that the Federal Circuit did not correctly apply the test for induced infringement under 35 U.S.C. §271(b) articulated in Commil USA, LLC v. Cisco Systems, Inc., 135 S. Ct. 1920 (2015), and the Court’s earlier decision in Global-Tech Appliances, Inc. v. SEB S.A., 563 U.S. 754 (2011). Commil, like Global-Tech, held that proof of induced infringement requires not “only knowledge of the patent” but also “proof the defendant knew the [induced] acts were infringing.” Id. at 1926, 1928. Commil, in reaffirmingGlobal-Tech, also necessarily reaffirmed that willful blindness can satisfy the knowledge requirement for active inducement. The Supreme Court granted certiorari and issued its GVR order on January 19, 2016.
Analysis. The ’236 patent is directed to a method for detecting the presence of and measuring distance to a nerve during surgery. The patented method requires sending a series of electrical pulses that gradually increase in strength until a pulse reaches sufficient strength to elicit a nerve response.
Only 1 limitation of Claim 1, the “stopping” step, is relevant to this case on remand, the court noted. The “stopping” step of claim 1 is step (c), which requires “increasing the intensity level of said stimulus signal until said predetermined neuro-muscular response is elicited by said stimulus pulse and stopping the emission of said stimulus signal immediately after said predetermined neuromuscular response is detected.” In the earlier appeal the Federal Circuit held that substantial evidence supported the jury’s finding of direct infringement of claim 1 of the ’236 patent by surgeons using MSD’s device, the “NIM-Eclipse.” That determination was not reopened by the Supreme Court’s remand.
The question before the court now was a limited one: whether the jury was presented with substantial evidence that MSD knew (or was willfully blind to the fact) that it was instructing doctors to infringe the ’236 patent. The jury’s verdict must be sustained if there was substantial evidence before the jury to support an inference that MSD knew (or was willfully blind to the fact) that doctors’ use of its device infringed the ’236 patent, the court observed.
MSD argued that no reasonable jury could have inferred from the evidence before it that MSD had knowledge of (or was willfully blind to) its customers’ infringement of the ’236 patent. However, there was substantial evidence that MSD’s infringement position was objectively unreasonable and that the jury, based on this evidence, could reasonably have concluded that MSD had knowledge (or was willfully blind to the fact) that it was infringing, the Federal Circuit ruled.
The central premise of MSD’s non-infringement position was that it reasonably construed narrowly the “stopping” limitation of the claims of the ’236 patent to require a complete termination of emission of any and all electrical pulses. After the NIM-Eclipse emits a stimulus signal that detects a nerve, it continues emitting electrical pulses at a lower energy rather than stopping emission of all electrical signals. MSD argued that this property of the NIM-Eclipse led MSD to believe that the device did not infringe the ’236 patent.
On its face, however, claim 1 of the ’236 patent says something different, according to the appellate court. Claim 1 requires “stopping the emission of said stimulus signal immediately after said predetermined neuro-muscular response is detected.” That is, claim 1 requires stopping a particular kind of signal, “said stimulus signal,” and does not require stopping any and all electrical signals emitted by the device.
The language of claim 1 clearly requires stopping the emission not of any or all stimulus signals but of one particular stimulus signal: “said stimulus signal,” the signal that triggered a response from the nerve being probed, the court reasoned. In MSD’s words, under “the very clear language of claim 1,” “the steps contemplate emission of one signal to elicit one neuro-muscular response, with that same signal stopping upon the detection of that response.”
MSD’s argument was that the “stopping” limitation requires total cessation of any and all electrical stimulus pulses emitted by the nerve-monitoring device. It insisted that “[s]topping the emission of the signal thus means the electrode – i.e., the device – must stop emitting any signal.” This theory was clearly inconsistent with the construction of “said stimulus signal” that MSD itself propounded, the court explained.
MSD also argued that the prosecution history of the ’236 patent, which was before the jury, supported MSD’s interpretation of the “stopping” step and its theory that the jury could not have found the knowledge (or willful blindness) necessary for induced infringement. Contrary to MSD’s argument, the prosecution history demonstrated that “stopping” refers to stoppage of the stimulus signal capable of eliciting a neuromuscular response, not necessarily stoppage of any and all electrical stimulus, the court said.
Undisputed evidence before the jury showed that, immediately after nerve stimulation, the NIM-Eclipse reduced the strength of the electrical stimulus pulses it emitted to a level that was not capable of stimulating the nerve that had provided the neuromuscular response. Given the strength of the evidence NuVasive presented, a reasonable jury could have concluded that MSD must have known that its NIM-Eclipse device “stopped” emitting “said stimulus signal” immediately after that signal elicited a neuromuscular response. Further, MSD’s knowledge of the ’236 patent was undisputed. As such, under these circumstances, a reasonable jury could have concluded that MSD’s non-infringement position was objectively unreasonable and that MSD must have known that NIM-Eclipse meets the limitations of the claims of the ’236 patent. A reasonable jury could therefore have inferred that MSD must have known, or was willfully blind to the fact, that doctors using the device infringe those claims.
Concurring opinion. In a concurring opinion, Judge Reyna agreed with the result reached by the majority but expressed several concerns regarding how the result was reached and its future implications.
The case is Nos. 2013-1576 and 2013-1577.
Attorneys: Luke Dauchot (Kirkland & Ellis LLP) for Warsaw Orthopedic, Inc. and Medtronic Sofamor Denek USA, Inc. Deanne Maynard (Morrison & Foerster LLP) for NuVasive, Inc.
Companies: Warsaw Orthopedic, Inc.; Medtronic Sofamor Denek USA, Inc.; NuVasive, Inc.
MainStory: TopStory Patent FedCirNews
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