Cave Consulting Grp. v. OptumInsight
| Decision Date | 28 August 2019 |
| Docket Number | Case No. 15-cv-03424-JCS |
| Parties | CAVE CONSULTING GROUP, INC., Plaintiff, v. OPTUMINSIGHT, INC., Defendant. |
| Court | U.S. District Court — Northern District of California |
I. INTRODUCTION
Plaintiff Cave Consulting Group, Inc. ("CCGroup") alleges that Defendant OptumInsight, Inc. obtained patents, which are related to software used to group medical claims, through fraud on the U.S. Patent and Trademark Office (the "PTO") and used those patents to exclude CCGroup from the market, through sham litigation and other efforts to advertise, assert, or enforce the patents. CCGroup's claims are based on federal antitrust law and California's malicious prosecution doctrine. OptumInsight and CCGroup each move to exclude certain opinions of each other's expert witnesses and for summary judgment on some or all of the claims at issue. The Court held a hearing on August 12, 2019. For the reasons discussed below, OptumInsight's motion for summary judgment based on statutes of limitations is DENIED, and the parties' other motions are GRANTED in part and DENIED in part. CCGroup's malicious prosecution and antitrust claims may largely proceed—although CCGroup may recover damages only based on litigation costs and fees, not based on market effects—but the Court grants summary judgment in favor of OptumInsight as to CCGroup's Lanham Act claim.1
This order is provisionally filed under seal and the parties are ordered to restrict its contents to attorneys' eyes only, in the same manner as provided for the most confidential information governed by the protective order in this case. Either party may file narrowly tailored proposed redactions no later than fourteen days after the date of this order, with accompanying declarations establishing compelling reasons to maintain the redacted information under seal. The declarations must be filed in the public record, while the proposed redactions must be filed under seal. The declarations should also address whether opposing counsel should be permitted to disclose the redacted information to their clients. In presenting reasons for sealing, the parties may not rely on the Court previously having granted permission to file underlying documents under seal, and may not incorporate by reference their previous submissions in support of sealing such documents. If neither party proposes redactions by that deadline, the order will be filed in the public record.
A case management conference to set trial dates and pretrial deadlines will occur on October 4, 2019 at 2:00 PM. The parties shall file an updated joint case management statement no later than September 27, 2019.
II. TABLE OF CONTENTS
I. Introduction ............................................................................................................................... 1
II. Table of Contents ...................................................................................................................... 2
III. Background ............................................................................................................................ 4
IV. Motions to Exclude Expert Testimony ................................................................................... 9
V. Motions for Summary Judgment ............................................................................................. 45
VI. Conclusion .......................................................................................................................... 102
III. BACKGROUND
This background section is provided solely for the convenience of the reader and is intended as a brief and uncontroversial timeline and summary of claims, leaving discussion of more specific facts and evidence for the analysis sections below. Nothing in this section, as opposed to the separate analysis sections below, should be construed as resolving any question of fact or of the sufficiency of the parties' evidence.
In 1993, Dennis Dang began developing a concept for episode-of-care groupers, in conjunction with his partner Mitchell Portnoy and programmer Daniel Gardiner, while working for Symmetry Inc. (which, much later, would become OptumInsight through a merger2). Symmetry received a request for proposal ("RFP") from the insurance company Aetna in 1994,and provided a response to the RFP in June of that year describing its grouper product and offering to license it to Aetna. There is some evidence that in August of 1994 Symmetry altered the method that its product used to group claims, resulting in improved performance. Symmetry licensed its product to a different customer later that year.
In August of 1995, Dang applied for a patent that would eventually be issued as U.S. Patent No. 5,835,897.3 The parties dispute whether Symmetry's June 1994 response to Aetna's RFP constitutes an invalidating offer of sale more than one year before the application date. Symmetry did not disclose the RFP response to the U.S. Patent and Trademark Office (the "PTO") in its application.
Around the same time, OptumInsight's predecessor Ingenix, Inc. and inventor ...
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