664 F.3d 907 (Fed. Cir. 2012), 2010-1285, MarcTec, LLC v. Johnson & Johnson

Docket Nº:2010-1285.
Citation:664 F.3d 907, 101 U.S.P.Q.2d 1177
Opinion Judge:O'MALLEY, Circuit Judge.
Party Name:MARCTEC, LLC, Plaintiff-Appellant, v. JOHNSON & JOHNSON and Cordis Corporation, Defendants-Appellees.
Attorney:William L. Mentlik, Lerner, David, Littenberg, Krumholz & Mentlik, LLP, of Westfield, NJ, argued for plaintiff-appellant. With him on the brief was Roy H. Wepner. Of counsel were Robert G. Krupka and Christopher R. Liro, Kirkland & Ellis LLP, of Chicago, IL. Gregory L. Diskant, Patterson Belknap ...
Judge Panel:Before NEWMAN, PROST, and O'MALLEY, Circuit Judges.
Case Date:January 03, 2012
Court:United States Courts of Appeals, Court of Appeals for the Federal Circuit
 
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Page 907

664 F.3d 907 (Fed. Cir. 2012)

101 U.S.P.Q.2d 1177

MARCTEC, LLC, Plaintiff-Appellant,

v.

JOHNSON & JOHNSON and Cordis Corporation, Defendants-Appellees.

No. 2010-1285.

United States Court of Appeals, Federal Circuit.

January 3, 2012

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[Copyrighted Material Omitted]

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William L. Mentlik, Lerner, David, Littenberg, Krumholz & Mentlik, LLP, of

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Westfield, NJ, argued for plaintiff-appellant. With him on the brief was Roy H. Wepner. Of counsel were Robert G. Krupka and Christopher R. Liro, Kirkland & Ellis LLP, of Chicago, IL.

Gregory L. Diskant, Patterson Belknap Webb & Tyler LLP, of New York, NY, argued for defendants-appellees. With him on the brief were Eugene M. Gelernter, Irena Royzman, and Charles D. Hoffmann.

Before NEWMAN, PROST, and O'MALLEY, Circuit Judges.

O'MALLEY, Circuit Judge.

In this patent case, MarcTec, LLC (" MarcTec" ) filed suit in the Southern District of Illinois against Cordis Corporation and Johnson & Johnson (collectively, " Cordis" ) 1 alleging infringement of U.S. Patent Nos. 7,128,753 (" the '753 Patent" ) and 7,217,290 (" the '290 Patent" ) (collectively, " the patents-in-suit" ). After claim construction, the district court granted Cordis's motion for summary judgment of noninfringement. MarcTec, LLC v. Johnson & Johnson, 638 F.Supp.2d 987 (S.D.Ill.2009) ( " Noninfringement Order " ). On appeal, this court affirmed the district court's construction of the term " bonded" in the patents-in-suit and its judgment of noninfringement based on that construction. MarcTec, LLC v. Johnson & Johnson, 394 Fed.Appx. 685 (Fed.Cir.2010) (" Prior Appeal " ). On February 23, 2010, the district court granted Cordis's motion to: (1) declare this case exceptional under 35 U.S.C. § 285; and (2) award Cordis its reasonable attorney and expert witness fees. Specifically, the district court awarded Cordis attorney fees and expenses in the amount of $3,873,865.01, and expert fees and expenses of $809,788.02, for a total award of $4,683,653.03. MarcTec, LLC v. Johnson & Johnson, No. 07cv825, 2010 WL 680490, 2010 U.S. Dist. LEXIS 15789 (S.D.Ill. Feb. 23, 2010) (" Exceptional Case Order " ). MarcTec appeals only from the district court's final judgment declaring this case exceptional and awarding attorney and expert fees to Cordis— it does not challenge the reasonableness of the amount of fees awarded. Because the district court did not err in finding this case exceptional under 35 U.S.C. § 285, and did not abuse its discretion in awarding expert witness fees under its inherent authority, we affirm.

BACKGROUND

A. Factual Background

1. The Patents-in-Suit

Dr. Peter Bonutti is an orthopedic surgeon and is a named inventor on numerous patents, including the patents-in-suit. The '753 Patent, which is entitled " Surgical Devices Having a Polymeric Material with a Therapeutic Agent and Methods for Making Same," issued on October 31, 2006. The '290 Patent, which issued on May 15, 2007, is entitled " Surgical Devices Containing a Heat Bondable Material with a Therapeutic Agent." The patents-in-suit have been assigned to Dr. Bonutti's research company— MarcTec.

As this court noted in the prior appeal, the patents-in-suit have identical specifications and are " directed to a surgical implant in which a polymeric material is bonded by heat to an expandable implant, where the polymer includes a therapeutic agent such as an antibiotic." Prior Appeal, 394 Fed.Appx. at 686. Importantly, both patents provide for " heat bondable

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material" that is " bonded" to a surgical device or implant.

a. The Claims at Issue

MarcTec alleged that Cordis infringed at least Claims 1, 3, and 4 of the ' 753 Patent. Claim 1, the only independent claim of the '753 Patent, recites:

A surgical device for implantation in a body comprising: an implant, at least a portion of which is expandable; and a polymeric material bonded to the implant, wherein the polymeric material is thermoplastic, includes a therapeutic agent, is non-flowable and non-adherent at room temperature, and becomes flowable, tacky, and adherent upon the application of heat.

'753 Patent col. 16 ll.7-14 (emphases added).

With respect to the '290 Patent, MarcTec alleged that Cordis infringed at least Claims 1-8, 10 and 14. Claim 1, the only independent claim of the ' 290 Patent, recites, in pertinent part:

An implant for implantation in a human body comprising: a tubular member having a channel and mechanically expandable upon activation of a delivery mechanism ... and a first component bonded to at least a portion of the tubular member and formed of a heat bondable material that includes a therapeutic agent selected from the group consisting of a tissue ingrowth promoter and an antibiotic, wherein the heat bondable material is non-flowable and non-adherent at room temperature and becomes flowable, tacky, and adherent upon the application of heat.

'290 Patent col. 16 ll.5-26 (emphases added). The parties' dispute focused, in large part, on the emphasized limitations and the proper construction of the term " bonded." The specifications explain that the terms " bondable" or " bondable material" refer " to any material, suitable for use in surgical applications, which can be softened and made flowable by the application of heat, and which, when softened, will become tacky and bond to other materials and will flow to fill available space." '753 Patent col. 3 ll.52-57; '290 Patent col. 3 ll.48-53.

b. The Prosecution History

Dr. Bonutti, through his attorneys, filed the applications that led to the patents-in-suit in 2002 and 2003. These applications claimed priority from Dr. Bonutti's 1990 patent application, which was entitled " Surgical Devices Assembled Using Heat Bondable Materials." Exceptional Case Order, 2010 WL 680490, at *2, 2010 U.S. Dist. LEXIS 15789, at *5. During prosecution, the Patent and Trademark Office (" PTO" ) rejected Dr. Bonutti's proposed claims as invalid over U.S. Patent No. 5,102,417 (" the '417 Patent" ), which issued to Dr. Julio Palmaz, " the inventor of the balloon-expandable stent." Id.

In response to the examiner's rejection, Dr. Bonutti explained that the ' 417 Patent teaches " an absorbable polymer coating placed upon wall surfaces of tubular shaped members." Joint Appendix (" J.A." ) 929. In contrast, Dr. Bonutti's claimed " implant includes a heat bondable material which is bonded to an implant by the application of heat." Id. Based on the rejection, Dr. Bonutti, through his attorneys, amended his patent claims to highlight the fact that the material bonded to the claimed implant " is non-flowable and non-adherent at room temperature and becomes flowable, tacky, and adherent upon the application of heat." Exceptional Case Order, 2010 WL 680490, at *2, 2010 U.S. Dist. LEXIS 15789, at *6.

Dr. Bonutti also distinguished the '417 Patent on grounds that it discloses " an expandable intraluminal vascular graft, or

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expandable prosthesis for a body passageway.... Applicants, on the other hand, disclose, inter alia, an assembly for use in surgical applications in humans." J.A. 928. During claim construction, the district court construed this distinction as a representation that Dr. Bonutti's invention did not include " intraluminal grafts" (i.e., stents). Exceptional Case Order, 2010 WL 680490, at *9, 2010 U.S. Dist. LEXIS 15789, at *5.

2. The Cypher Stent

Cordis develops, manufactures, and sells products that are used to treat coronary artery disease, including the accused Cypher stent. The Cypher stent is a balloon expandable drug-eluting stent which utilizes technology invented by Dr. Palmaz— " the same technology that Dr. Bonutti disclaimed to obtain allowance." Exceptional Case Order, 2010 WL 680490, at *2, 2010 U.S. Dist. LEXIS 15789, at *7. At this stage of the proceedings, it is undisputed that the Cypher's drug/polymer coating is sprayed onto the stent at room temperature and bonds to it at room temperature— not by the application of heat. Prior Appeal, 394 Fed.Appx. at 686.

B. Procedural History

On November 27, 2007, MarcTec filed suit against Cordis alleging that the Cypher stent infringes the '753 Patent and the '290 Patent. In response, Cordis: (1) denied infringement; and (2) asserted counterclaims seeking declaratory judgment that the patents-in-suit are invalid and not infringed.

1. Claim Construction

On February 19, 2009, the district court conducted a Markman hearing. In its claim construction briefing and at the hearing, MarcTec told the court that no construction of the disputed claim terms was needed because each term had a plain and ordinary meaning. In fact, during the Markman hearing, counsel for MarcTec instructed the court that it should focus on the claim language and look to the specification only if there is ambiguity in that language.

On March 31, 2009, the district court issued its claim construction order. MarcTec, LLC v. Johnson & Johnson, No. 07cv825, 2009 WL 910200, 2009 U.S. Dist. LEXIS 27011 (S.D.Ill. Mar. 31, 2009) (" Claim Construction Order " ). Consistent with our guidance in Phillips v. AWH Corp., 415 F.3d 1303, 1313-19 (Fed.Cir.2005) (en banc), the district court considered the language of the claims, the specification, and statements made during the prosecution history in reaching its conclusions regarding the proper construction of the claims. The district court rejected MarcTec's attempts to minimize the role of the specification, noting that, in Phillips, we indicated that the specification " is the single best guide to the meaning of a disputed term." Claim Construction Order, 2009 WL 910200, at *7, 2009 U.S. Dist. LEXIS 27011, at *9 (quoting Phillips,...

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