Cedars-Sinai Medical Center v. Watkins, CEDARS-SINAI

CourtUnited States Courts of Appeals. United States Court of Appeals for the Federal Circuit
Writing for the CourtBefore ARCHER, MICHEL and CLEVENGER; CLEVENGER
Citation11 F.3d 1573,29 USPQ2d 1188
PartiesMEDICAL CENTER, Warren S. Grundfest, M.D., James S. Forrester, M.D., and Frank Litvack, M.D., Plaintiffs-Appellants, v. James D. WATKINS, Secretary, United States Department of Energy, Defendant-Appellee.
Docket NumberCEDARS-SINAI,No. 92-1410,92-1410
Decision Date13 December 1993

Page 1573

11 F.3d 1573
29 U.S.P.Q.2d 1188
James S. Forrester, M.D., and Frank Litvack, M.D.,
James D. WATKINS, Secretary, United States Department of
Energy, Defendant-Appellee.
No. 92-1410.
United States Court of Appeals, Federal Circuit.
Dec. 13, 1993.

Page 1575

Coe A. Bloomberg, Lyon & Lyon, of Los Angeles, CA, argued for plaintiffs-appellants. With him on the brief, was David A. Randall.

William C. Bergmann, Atty., Commercial Litigation Branch, Dept. of Justice, of Washington, DC, argued, for defendant-appellee. With him on the brief were Stuart E. Schiffer, Acting Asst. Atty. Gen. and Vito J. DePietro, Director. Also on the brief, was Thomas J. Byrnes, Asst. Director, Dept. of Justice, of counsel.

Before ARCHER, MICHEL and CLEVENGER, Circuit Judges.

CLEVENGER, Circuit Judge.

Cedars-Sinai Medical Center, a non-profit corporation, and Drs. Grundfest, Forrester, and Litvack, all of whom are employed at the Medical Center (collectively Cedars), appeal from the May 19, 1992 order of the United States District Court for the Central District of California 1 dismissing Cedars' cause of action without prejudice for lack of subject matter jurisdiction on ripeness grounds. After concluding that we have statutory jurisdiction over this appeal, we affirm the district court's dismissal.


In June 1983, Dr. Grundfest conducted certain experiments in the area of laser angioplasty 2 at the Argonne National Laboratory (Argonne), a government-owned facility operated by the University of Chicago under contract with the United States Department of Energy (Energy). After the work at Argonne, Grundfest et al. on December 8, 1983 filed U.S. Patent application Serial No. 06/559,430 entitled "Method of Medical Treatment Using an Excimer Laser on Organic Tissue" with Cedars as the assignee thereof. Foreign patents encompassing the subject matter of Grundfest's original U.S. application have since been procured by Cedars in at least eleven foreign countries.

On January 9, 1984, Dr. Gruen, an employee at Argonne with whom Grundfest had

Page 1576

performed his experiments, filed U.S. Patent application Serial No. 06/569,088 claiming the same subject matter as Grundfest's application. U.S. Patent No. 4,686,979, entitled "Excimer Laser Phototherapy for the Dissolution of Abnormal Growth," ultimately issued to Gruen et al. on August 18, 1987 from a continuation-in-part of the original application, 3 and is presently owned by the United States as assignee.

The same subject matter was also claimed by a third party, Mr. Ralph Linsker, who filed U.S. Patent application Serial No. 07/198,424 entitled "In vivo Ablation of Blood Vessel Lesions Employing Laser Energy at a Wavelength of 210 to 320 Nanometers" on May 25, 1988.

On September 10, 1991, as a result of Cedars' efforts, Interference No. 102,459 was declared between Grundfest (Senior Party), 4 Gruen, and Linsker, wherein priority of invention under 35 U.S.C. Sec. 102(g) will be initially determined by the Board of Patent Appeals and Interferences (Board).

On December 10, 1991, Energy served upon Cedars a document entitled "Determination Under 42 U.S.C. Sec. 5908" (Determination) which asserted title to any invention Grundfest may have made. The Determination stated, in part, that the Secretary of Energy

had] determined that the activities of Grundfest ... in relation to the invention were carried out with a contribution by the Government of the use of Government facilities, equipment, materials and allocated funds and that the invention is related to the arrangement or understanding under which the participants in the research operated and the work they performed and therefore that the invention, if it was made by Grundfest ..., was made in the manner specified in 42 U.S.C. [Sec.] 5908

The Determination thus implicitly concluded that "title to [any] invention [made by Grundfest et al.] shall vest in the United States." 42 U.S.C. Sec. 5908. The Determination also provided that any request by Cedars for reconsideration of the administrative action "shall be submitted to [Energy] within thirty (30) days" of issuance. Cedars, however, did not request reconsideration. 5 After expiration of the 30-day period, Energy issued a declaration of finality on February 4, 1992 informing the Board that the Determination was a final agency action.

Meanwhile, Cedars had filed suit in the United States District Court for the Central District of California asserting two causes of action. In its first cause of action, Cedars sought to set aside the Determination under the Administrative Procedure Act (APA), 5 U.S.C. Secs. 701-706 (1988), as invalid and without force or effect because, inter alia : The Determination violated Cedars' Fifth Amendment right to due process; it was generated in a procedurally defective manner; and the issuance thereof exceeded the Secretary of Energy's statutory authority. Cedars' second cause of action sought a declaratory judgment under 28 U.S.C. Sec. 2201 (1988) on several issues: Whether the doctrines of laches, waiver and estoppel bar the government from asserting title to Cedars' invention under section 5908; whether section 5908 applies to Cedars; whether section 5908 is superseded by chapter 18 of Title 35 of the United States Code, 35 U.S.C. Secs. 200-212 (1988) (35 U.S.C. ch. 18); and whether the Determination was unlawfully issued.

After considering Cedars' complaint and the parties' various motions, the district court granted the government's motion to dismiss for lack of subject matter jurisdiction under Rule 12(b)(1) of the Federal Rules of

Page 1577

Civil Procedure. 6 The court concluded that the entire controversy between the parties was not ripe for adjudication, reasoning that the Board could reach a result in the pending Interference that would eliminate any need to address Cedars' arguments:

[T]he issues are not fit for judicial decision since the interference action is still pending and the Board has not yet issued an opinion....

... It is possible that the Board could decide that the patent belongs to the Gruen group, which currently holds the patent.... [or to] Linsker.... [in which case Energy's] Determination would be of absolutely no consequence because it only says that in the event the Board awards the patent to the Grundfest group, the United States would still own the patent....

The court found insufficient to render the case ripe for adjudication Cedars' allegation that the Determination had immediately impacted Cedars' rights by placing a cloud upon the title to its foreign patents, thereby affecting Cedars' ability to successfully license its intellectual property. Cedars timely appealed the district court's dismissal to this court. The government then filed a motion to dismiss the appeal for lack of subject matter jurisdiction, arguing that the appeal belonged in the United States Court of Appeals for the Ninth Circuit. This motion is presently pending, Cedars' suggestion for an in banc hearing on this issue having been declined on October 7, 1992.


In response to the government's motion to dismiss, we turn first to the issue of whether this court possesses statutory jurisdiction over the subject matter of this appeal before reviewing arguments on the constitutional ripeness issue.

Our jurisdiction is circumscribed by statute, and is specifically limited to certain catalogued fields of the law. Pertinent to this case, 28 U.S.C. Sec. 1295(a)(1) (1988) grants to this court exclusive jurisdiction over an appeal from a federal district court "if the jurisdiction of that court was based, in whole or in part, on [28 U.S.C. Sec. 1338 (1988) ]." Thus, under section 1295(a)(1), the determination of whether this court has jurisdiction to hear an appeal is necessarily driven by whether a district court's jurisdiction was based at least in part on 28 U.S.C. Sec. 1338. This presents a pure question of law. See Speedco, Inc. v. Estes, 853 F.2d 909, 911, 7 USPQ2d 1637, 1639-40 (Fed.Cir.1988); Christianson v. Colt Indus. Operating Corp., 822 F.2d 1544, 1550, 3 USPQ2d 1241, 1245-46 (Fed.Cir.1987), vacated, 486 U.S. 800, 108 S.Ct. 2166, 100 L.Ed.2d 811, 7 USPQ2d 1109 (1988).

28 U.S.C. Sec. 1338(a) reads, in pertinent part: "The district courts shall have original jurisdiction of any civil action arising under any Act of Congress relating to patents...." (emphasis added). In determining whether section 1338(a) is satisfied, the failure of a complaint to reference section 1338 is not dispositive. Morganroth v. Quigg, 885 F.2d 843, 846, 12 USPQ2d 1125, 1127 (Fed.Cir.1989). Rather, "[t]he critical inquiry is whether in fact the complaint asserted a claim arising under the patent laws." Id., 885 F.2d at 846, 12 USPQ2d at 1127.

In Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 108 S.Ct. 2166, 100 L.Ed.2d 811, 7 USPQ2d 1109 (1988), the Supreme Court interpreted the "arising under" language of section 1338(a) in the same fashion as that of 28 U.S.C. Sec. 1331 (1988), which governs the federal district courts' original jurisdiction over "federal questions." The Court thereby incorporated the principles underlying the "well pleaded complaint" rule into the root of our patent law jurisdiction, stating:

[Section] 1338 jurisdiction ... extend[s] only to those cases in which a well-pleaded complaint establishes either that federal patent law creates the cause of action or that the plaintiff's right to relief necessarily depends on resolution of a substantial

Page 1578

question of federal patent law, in that patent law is a necessary element of one of the well-pleaded claims.

486 U.S. at 808-09, 108 S.Ct. at 2173-74, 7 USPQ2d at 1113 (citations omitted). Either determination under Christianson requires that this court identify the statute(s) pursuant to which the present causes of action are brought.

Cedars' second cause of action seeks a...

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