Fonar Corp. v. General Elec. Co., CV 92-4196.

• Decision Date: 30 September 1995
• Docket Number: No. CV 92-4196.,CV 92-4196.
• Citation: 902 F. Supp. 330
• Parties: FONAR CORPORATION, a Delaware corporation, and Dr. Raymond V. Damadian, an individual, Plaintiffs, v. GENERAL ELECTRIC COMPANY, a New York corporation, and Drucker & Genuth, MDS, P.C., D/B/A South Shore Imaging Associates, a New York corporation, Defendants.
• Court: U.S. District Court — Eastern District of New York

902 F. Supp. 330

FONAR CORPORATION, a Delaware corporation, and Dr. Raymond V. Damadian, an individual, Plaintiffs, v. GENERAL ELECTRIC COMPANY, a New York corporation, and Drucker & Genuth, MDS, P.C., D/B/A South Shore Imaging Associates, a New York corporation, Defendants.

No. CV 92-4196.

United States District Court, E.D. New York.

September 30, 1995.

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Robins, Kaplan, Miller & Ciresi by Ronald J. Schutz, Martin R. Lueck, William L. Norine, Allison A. Johnson, Minneapolis, Minnesota, for Plaintiffs.

Morgan, Lewis & Bockius by Richard A. Mescon, Laurie E. Foster, New York City, Wyatt, Gerber, Burke & Badie by Douglas W. Wyatt, Frederick J. Dorchak, David M. McConoughey, New York City, Bracken & Margolin by John P. Bracken, Islandia, New York, for Defendants.

WEXLER, District Judge.

Fonar Corporation and its founder Dr. Raymond V. Damadian ("Damadian") (collectively, "Fonar") brought the above-referenced patent infringement action, by summons and complaint dated September 1, 1992, against General Electric Corporation and Drucker & Genuth, MDs, P.C., d/b/a South Shore Imaging Associates ("South Shore") (collectively, "GE").¹ On May 19, 1995, after a thirteen-day trial on liability, a jury returned a verdict in favor of plaintiffs wherein it found that the two patents in suit were not invalid and infringed. On May 26, 1995, after hearing three days of testimony on damages, the same jury awarded plaintiffs $110,575,000. Presently before the Court is GE's motion, pursuant to Fed.R.Civ.P. 50 and 59, for judgment as a matter of law ("JMOL") and, in the alternative, for a new trial.

I. THE '832 PATENT

A. Background

Fonar Corporation is the exclusive licensee of U.S. Patent No. 3,789,832 (the "'832 patent"), entitled "Apparatus and Method for Detecting Cancer in Tissue," issued February 5, 1974 to Damadian, on application filed March 17, 1972. The method by which cancer may be detected, as claimed by the '832 patent, employs the use of nuclear magnetic resonance ("NMR" or "MR"). Some technological background is necessary.²

Nuclei in the body's atoms generate magnetic fields at varying energy levels. Under normal conditions, the north and south poles of the body's nuclei point in various directions. When placed in an external magnetic field, however, nuclei align with or against the direction of the external field depending on the degree of their own magnetic strength — nuclei in a low-energy state align with the external field; those in a high-energy state point away from the field. Exposure to an external magnetic field also causes nuclei to wobble, or precess, as they spin on their own axes.

A radio frequency ("RF") wave, when pulsed into a body exposed to an external magnetic field, produces two effects in nuclei: first, the RF energy causes low-energy nuclei to flip into a high-energy state and align in a direction opposite to the magnetic field; second, it causes nuclei to precess in synch, or "in phase." When the RF pulse is eliminated, the effected nuclei return to their natural magnetic state. This is called "relaxation." Relaxation is quick, but not instantaneous.

During relaxation, effected nuclei emit a detectable RF signal of their own as they return to their low energy state. Their signal comprises three elements. First, the strength of the signal depends on the number of nuclei that flipped into high energy state when the RF pulse was turned on. This element is called proton density. Second, the strength of the signal depends on the rate at which the effected nuclei return to their low energy state, or, to use the proper term, the rate at which they achieve "spin-lattice" relaxation. This time is specified by "T1". The last element effecting the strength of the emitted signal is the rate at which the effected nuclei loose "phase" among their respective wobbles, or, achieve "spin-spin" relaxation. This time is specified by "T2".

Trial testimony revealed that, in 1970, Damadian conducted research to test his theory that T1 and T2 relaxation times were different in healthy and diseased tissue of the same tissue type. After obtaining encouraging results, Damadian applied for and obtained the '832 patent. Claims 1 and 2 of the '832 patent read:

1. A method for detecting cancer comprising:

a. measuring and establishing standard NMR spin-lattice relaxation times and spin-spin relaxation times for both normal and cancerous tissue of the type under analysis using as an indicator nuclei at least one nuclei which exhibits deviant behavior in cancerous tissue;

b. measuring the NMR spin-lattice relaxation times and spin-spin relaxation times for the suspected tissue to determine the extent of deviant behavior of the indicator nuclei; and

c. comparing the values obtained in (b) against the standards obtained in (a).

2. The method of claim 1, wherein the indicator nuclei are cell water protons.

In the instant action, Fonar alleged that, between September 1986 and February 3, 1991, GE infringed or induced infringement of Claim 1 and dependent Claim 2 of the '832 patent by the manufacture, use, and/or sale of magnetic resonance imaging ("MRI") scanners.

MRI scanners read the RF signal emitted from nuclei during relaxation and produce an image therefrom. The image represents a view of a slice of the body at a particular point along a particular plane. The scanner selects the slice of the body to be imaged and subdivides it into tiny squares of tissue, or voxels, through the use of gradient magnetic fields. After the RF pulse is introduced, the scanner's antenna collects an RF signal emitted from each voxel during relaxation. The electric signals are then converted into values to be read by a computer. For each voxel there is a corresponding pixel on an imaging screen. The computer displays the value, or RF signal strength, for each voxel as a shade of gray on the corresponding pixel. How dark or light a pixel is depends on the strength or weakness of the RF signal emitted by its corresponding voxel.

The scanner cannot produce a useful image, however, without some assistance from the operating technician. Nuclei of a given tissue type generally emit RF signals of the same strength during relaxation. As such, that tissue type should appear in the MR image as a single shade of gray. An abnormality in that tissue, however, will produce an RF signal of a different strength and a different shade of gray on the screen. As such, a dark spot on an otherwise light image of brain tissue, for example, would indicate to a physician that there is an abnormality in the patient's brain. This being so, it is essential that the scanner obtain the maximum contrast between the varying degrees of gray. The scanner accomplishes this by repeating the gradient-RF pulse process many times. If the pulsing is done with the proper timing, the contrast will increase and the image will become sharper with every repetition. The technician sets the timing, or, pulse sequence, as it is called. This task actually involves two settings: time echo ("TE") and time to repeat ("TR"). TE and TR are called pulse protocols or timing parameters.

Fonar contended that GE infringed the '832 patent because MRI scanners manufactured and sold by GE determine whether cancer may be present in suspect tissue by comparing the T1 or T2 relaxation times of the suspect tissue with predetermined standard T1 or T2 relaxation times for normal and cancerous tissue of the same tissue type. The jury agreed, finding that GE infringed Claims 1 and 2 of the '832 patent. As to validity, the jury found that "Damadian invented the subject matter claimed by the '832 patent." The jury awarded Fonar $35 million in damages. The Court reserved decision on GE's post-trial motion for JMOL. The instant motion for JMOL is made on renewal.

B. Claim Construction and Infringement

On a motion for JMOL, a district court may not disregard a jury verdict unless it is convinced that the trial record contains no evidence "`upon which a jury might properly have returned a verdict in the non-movant's favor when the correct legal standard is applied.'" Markman v. Westview Instruments, Inc., 52 F.3d 967, 975 (Fed.Cir. 1995) (en banc) (quoting Jamesbury Corp. v. Litton Indus. Prods., Inc., 756 F.2d 1556, 1560 (Fed.Cir.1985)) (emphasis omitted). "Factual findings made by the jury in arriving at its verdict are to be upheld unless the party moving for JMOL shows that (when the correct legal standard is applied) there is not substantial evidence to support a finding in favor of the nonmovant." Id. (citing Read Corp. v. Portec, Inc., 970 F.2d 816, 821 (Fed. Cir.1992)). Whether the correct legal standards have been applied by the jury, either expressly or by implication, is a question considered by the district court de novo. Id. (citations omitted).

"Substantial" evidence is such relevant evidence, taken from the record as a whole, as might be accepted by a reasonable mind as adequate to support the finding under review. Dana Corp. v. IPC Ltd. Partnership, 860 F.2d 415, 417 (Fed.Cir.1988), cert. denied, 490 U.S. 1067, 109 S.Ct. 2068, 104 L.Ed.2d 633 (1989). In determining whether substantial evidence is present, "a court must: (1) consider all the evidence, (2) in a light most favorable to the non-mover; (3) drawing all reasonable inferences favorable to the non-mover; (4) without determining credibility of witnesses, and (5) without substituting its choice for that of the jury between conflicting elements in the evidence." Id. (quoting Connell v. Sears, Roebuck & Co., 722 F.2d 1542, 1546 (Fed.Cir. 1983)) (other citations omitted).

A jury's infringement verdict must stand where a court finds substantial evidence supporting the finding that the accused process or product performs each element of at least one of the properly construed patent claims. See Read Corp. v. Portec, Inc., 970 F.2d 816, 821 (Fed.Cir. 199...