Baxter Intern., Inc. v. COBE Laboratories, Inc.

• Decision Date: 10 July 1996
• Docket Number: No. 95-1407,95-1407
• Citation: 88 F.3d 1054,39 USPQ2d 1437
• Parties: BAXTER INTERNATIONAL, INC. and Baxter Healthcare Corporation, Plaintiffs-Appellants, v. COBE LABORATORIES, INC. and Cobe BCT, Inc., Defendants-Appellees.
• Court: U.S. Court of Appeals — Federal Circuit

Page 1054

88 F.3d 1054

39 U.S.P.Q.2d 1437

BAXTER INTERNATIONAL, INC. and Baxter Healthcare Corporation, Plaintiffs-Appellants, v. COBE LABORATORIES, INC. and Cobe BCT, Inc., Defendants-Appellees.

No. 95-1407.

United States Court of Appeals Federal Circuit.

July 10, 1996.

Rehearing Denied; Suggestion for Rehearing In Banc Declined

Sept. 4, 1996.

Gary W. McFarron, Cook, Egan, McFarron & Manzo, Ltd., Chicago, Illinois, argued for plaintiffs-appellants. With him on the brief were Granger Cook, Jr. and Andrew G. Kolomayets. Of counsel were Paul C. Flattery and Bradford R.L. Price, Baxter International, Inc., Deerfield, Illinois.

Willem G. Schuurman, Arnold, White & Durkee, Austin, Texas, argued for defendants-appellees. With him on the brief were David D. Bahler and Michael S. Metteauer.

Before NEWMAN, LOURIE, and SCHALL, Circuit Judges.

LOURIE, Circuit Judge.

Baxter International, Inc. and Baxter Healthcare Corporation (collectively "Baxter") appeal from the decision of the United States District Court for the Northern District of Illinois holding on summary judgment that the asserted claims of U.S. Patent 4,734,089 are invalid under 35 U.S.C. § 102(b) on the ground of a prior public use. Baxter Int'l, Inc. v. Cobe Lab., Inc., Nos. 89 C 9460, 93 C 3390 (N.D. Ill. June 1, 1995). Because the district court did not err in holding that there were no genuine issues of material fact regarding the disputed public use and because COBE was entitled to judgment as a matter of law, we affirm.

BACKGROUND

The '089 patent concerns a sealless centrifuge for separating blood into its components. The application for the patent was filed on May 14, 1976 and it therefore had a critical date of May 14, 1975 for purposes of 35 U.S.C. § 102(b). The alleged prior public use involved the activities of Dr. Jacques Suaudeau, ¹ who was a research scientist for the National Institutes of Health (NIH). Suaudeau was studying isolated heart preservation by perfusion, which involved the pumping of whole blood and platelet-rich plasma that had been separated from whole blood through a heart. The centrifuge he had been using damaged platelets in the blood and he found that the damage was caused by rotating seals in the centrifuge. He approached Dr. Yoichiro Ito, another scientist at NIH, for advice in solving this problem, and Ito recommended that Suaudeau try using a sealless centrifuge that Ito had designed. Neither Suaudeau nor Ito had any relationship or connection with Herbert M. Cullis, the inventor named in the '089 patent. ²

Suaudeau had the centrifuge built by the machine shop at NIH using Ito's drawings. Suaudeau balanced the centrifuge with water and then with blood, and tested it, all before the critical date. It was immediately apparent to Suaudeau that the centrifuge worked properly for its original purpose, as a separator, and that the centrifuge separated blood into its components. He also tested the suitability of the centrifuge for his own purposes, by performing experiments in order to determine if the centrifuge would produce platelet-rich plasma with a platelet count satisfactory for perfusion. These tests involved operating the centrifuge for as long as forty-three hours. All of this occurred in Suaudeau's laboratory at the NIH campus in Bethesda, Maryland. Suaudeau also balanced and tested the centrifuge at Massachusetts General Hospital, where he went to work after leaving NIH.

Baxter sued COBE Laboratories, Inc. for infringement of the '089 patent; it later amended its complaint to add COBE BCT, Inc. as a co-defendant (these companies will be collectively referred to as "COBE"). Baxter asserted infringement of claims 1, 2, 4, 5, 7, 9-11, 13, 17, 25, and 26 of the '089 patent, and stipulated that claims 10, 17, and 25 were representative claims. See Miles Labs., Inc.

v. Shandon Inc., 997 F.2d 870, 879, 27 USPQ2d 1123, 1129 (Fed.Cir.1993) ("Where the parties stipulate to 'representative' claims, ... a validity resolution for the representative claims applies to the other claims as well."), cert. denied, --- U.S. ----, 114 S.Ct. 943, 127 L.Ed.2d 232 (1994).

The representative claims read in pertinent part as follows:

10. A centrifugal blood processing apparatus for use in conjunction with a flow system including at least one blood processing chamber and a flexible umbilical cable segment having a plurality of integral passageways for establishing fluid communication with said blood processing chamber, said apparatus comprising, in combination:

....

17. The method of centrifugally processing biological fluid with reduced risk of contamination of the fluids of the outside environment using a closed leak-proof envelope which envelope includes an umbilical having input and output at one side thereof and defining passageways there through, which umbilical includes a flexible segment which is capable of repeated axial twisting and untwisting, and which envelope also includes at least one processing chamber connected at the other side of the umbilical which chamber is in communication with the passageways thereof, comprising the steps of:

....

25. A disposable flow system for use in processing fluids in a centrifugal apparatus of the type having a stationary base, an orbiting assembly mounted to the base for orbiting about an axis at a first rotational speed, and a centrifugating rotor assembly for revolving about said axis at twice the rotational speed of said orbiting assembly, said unit comprising:

....

COBE filed a motion for summary judgment of invalidity, asserting that there were no genuine issues of material fact and that the claimed invention had been in public use before the critical date. On December 21, 1994, the district court conducted a hearing on COBE's motion. It then held that Suaudeau had publicly used the claimed invention before the critical date and that the use was not experimental. The court stated that "a use by a single person not under the control of the inventor and in public, as that term of art is used, is a[use] sufficient" to invalidate a patent. The court found that the invention here had been reduced to practice before the critical date, and that others at NIH and Mass. General had observed the centrifuge in operation. Regarding Baxter's assertion that Suaudeau's use was experimental, the court stated that "the experimental use exception is limited to the inventor or people working for the inventor or under the direction and control of the inventor," but that neither Suaudeau nor Ito were acting under the direction or control of Cullis, the inventor. Furthermore, the court found that Suaudeau was not experimenting to perfect or test the invention but, rather, was making modifications for his own particular requirements. Accordingly, the district court held that there were no genuine issues of material fact, that the claimed invention had been in public use before the critical date, and that the asserted claims of the '089 patent were invalid. Baxter now appeals.

DISCUSSION

Summary judgment is appropriate when there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Johnston v. IVAC Corp., 885 F.2d 1574, 1576-77, 12 USPQ2d 1382, 1383 (Fed.Cir.1989). Thus, summary judgment may be granted when no "reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). In determining whether there is a genuine issue of material fact, we view the evidence in the light most favorable to the party opposing the motion, with doubts resolved in favor of the nonmovant. Transmatic, Inc. v. Gulton Indus., Inc., 53 F.3d 1270, 1274, 35 USPQ2d 1035, 1038 (Fed.Cir.1995). The party challenging validity must prove its case by clear and convincing evidence. Ryko Mfg. Co. v. Nu-Star, Inc. Baxter argues that the district erred by not considering the totality of the circumstances or the policies underlying the public use bar. According to Baxter, Suaudeau's use of the centrifuge was not publicly known or accessible, and ethical constraints would have limited or precluded those who saw the centrifuge in operation from disclosing their knowledge of it. Baxter asserts that the most applicable policy involved here is the removal of inventions from the public domain that the public believes are freely available; according to Baxter, the public had no reason to believe that the centrifuge was freely available.

                950 F.2d 714, 716, 21 USPQ2d 1053, 1055 (Fed.Cir.1991).   We review a district court's grant of summary judgment de novo.  Conroy v. Reebok Int'l, Ltd., 14 F.3d 1570, 1575, 29 USPQ2d 1373, 1377 (Fed.Cir.1994)
                

COBE responds that the district court correctly applied the law, considering the relevant policies underlying the public use bar. According to COBE, the centrifuge in Suaudeau's laboratory at NIH and at Mass. General was publicly accessible and those who saw it in operation were under no duty of confidentiality. Furthermore, COBE argues that the relevant policies support the district court's decision, as those who saw the centrifuge in operation would have reasonably believed the centrifuge was publicly available. COBE also asserts that NIH had an interest in continuing to use the technology that its employees, Ito and Suaudeau, began using without restriction before the critical date.

Under section 102, a person is entitled to a patent, inter alia, unless "the invention was ... in public use ... in this country, more than one year prior to the date of the application for patent in the United States." 35 U.S.C. § 102(b) (1994). We have described "public use" as including "any use of [the claimed] invention by a person other than the inventor who is under no limitation, restriction or obligation of secrecy to the inventor." In re Smith, 714 F.2d 1127, 1134, 218 USPQ 976, 983 (Fed.Cir.1983) (citing Egbert v. Lippmann, ...