Medtronic Inc. v. Bos. Scientific Corp.

• Citation: 695 F.3d 1266
• Decision Date: 14 December 2012
• Docket Number: 2011–1372.,Nos. 2011–1313,s. 2011–1313
• Parties: MEDTRONIC INC., Plaintiff–Cross Appellant, v. BOSTON SCIENTIFIC CORPORATION and Guidant Corporation, Defendants, and Mirowski Family Ventures, LLC, Defendant–Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals for the Federal Circuit

695 F.3d 1266

MEDTRONIC INC., Plaintiff–Cross Appellant,

v. BOSTON SCIENTIFIC CORPORATION and Guidant Corporation, Defendants,andMirowski Family Ventures, LLC, Defendant–Appellant.

Nos. 2011–1313, 2011–1372.

United States Court of Appeals, Federal Circuit.

Sept. 18, 2012.

Rehearing and Rehearing En Banc Denied Dec. 14, 2012.

38,119, 39,897. Cited.Martin R. Lueck, Robins, Kaplan, Miller & Ciresi L.L.P., of Minneapolis, MN, argued for plaintiff-cross appellant. With him on the brief were Jan M. Conlin and Stacie E. Oberts.

Arthur I. Neustadt, Oblon, Spivak, McClelland, Maier & Neustadt, LLP, of Alexandria, VA, argued for defendant-appellant. With him on the brief were Thomas J. Fisher and John F. Presper.

Before LOURIE, LINN, and PROST, Circuit Judges.

LINN, Circuit Judge.

Medtronic, Inc. (“Medtronic”) filed a complaint in the United States District Court for the District of Delaware seeking declaratory judgment of noninfringement and invalidity of Mirowski Family Ventures, LLC's (“MFV”) U.S. Reissue Patents No. RE38,119 (“RE'119 Patent”) and No. RE39,897 (“RE'897 Patent”). The district court entered judgment of noninfringement in favor of Medtronic and judgment of validity and enforceability in favor of MFV. Medtronic, Inc. v. Boston Scientific Corp., 777 F.Supp.2d 750 (D.Del.2011). MFV appeals the district court's judgment of noninfringement and Medtronic cross appeals the district court's claim construction on which its judgment of validity is based.¹ Because the district court relied on a legally incorrect allocation of the burden of proof to find noninfringement in the limited circumstances of this case and incorrectly construed the claim terms in question, this court vacates and remands.

I. Background

Between 1969 and 1980, Dr. Morton Mower (“Mower”) worked with Dr. Mieczyslaw Mirowski to develop the first implantable cardioverter defibrillator (“ICD”). An ICD is a device that is implanted into a patient's chest to monitor the patient's heartbeat. When the ICD detects a very rapid heartbeat that could cause cardiac arrest, it shocks the heart causing all muscle fibers to contract and resynchronize with the sinus node. Thus, the ICD is intended to prevent sudden death from heart attack, but is not designed to improve the general efficacy of the heart. The ICD is therefore not effective for treating heart conditions like congestive heart failure, where the underlying problem is the heart's decreasing ability to pump enough blood.

Between the 1960's and 1980's, Mower also analyzed EKG readings from congestive heart failure patients. Mower realized that slow conduction from one side of the heart to the other might be the cause of the incoordinate contractions that play a role in heart failure. Based on this observation, Mower developed what he called a biventricular pacer, a device that ultimately became known as a cardiac resynchronization therapy (“CRT”) device. Mower's CRT device increases the heart's efficacy by causing both the patient's left and right ventricles to contract simultaneously as the heart beats. Mower ultimately patented the CRT device in what are now the RE'119 and RE'897 Patents, both assigned to MFV. MFV exclusively licenses both patents to Guidant Corp.

Medtronic is a leading manufacturer of medical devices and equipment. In 1991, Medtronic entered into a sublicense agreement covering the RE'119 Patent with Eli Lilly & Co., Guidant's predecessor-in-interest of the patents-in-suit. That agreement allowed Medtronic to challenge the RE'119 Patent's validity, enforceability, and scope via a declaratory judgment action. In 2003, as required by the sublicense, Medtronic began paying royalties into escrow while challenging the validity of the RE'119 Patent. Ultimately the parties entered into a Litigation Tolling Agreement (“LTA”) that tolled litigation and obligated MFV to inform Medtronic of which Medtronic products MFV deemed were covered by the RE'119 Patent, or subsequent reissue patents claiming priority from the RE'119 Patent (here, the RE'897 Patent), and subject to royalty payments. If Medtronic disagreed, the LTA gave Medtronic the right to retain its license and obligated Medtronic to seek a declaratory judgment of noninfringement in the United States District Court for the District of Delaware. In October and November of 2007, MFV identified several Medtronic products that MFV thought practiced its patents. Pursuant to the LTA, on December 17, 2007, Medtronic filed the complaint giving rise to this declaratory judgment action. Because Medtronic remained MFV's licensee, MFV could not counterclaim for infringement of either patent.

Throughout this litigation the parties have disagreed over whether MFV, the patentee, bore the burden of proving infringement, or whether Medtronic, the declaratory judgment plaintiff, bore the burden of proving noninfringement. During discovery, MFV propounded an interrogatory requesting Medtronic to state the basis for its allegation in paragraph twenty-four of its complaint that “Medtronic's Accused Devices do not infringe any valid claim of the '119 Reissue Patent or the '897 Reissue Patent.” Complaint at 6, Medtronic, Inc. v. Boston Scientific Corp., 777 F.Supp.2d 750 (D.Del.2011), ECF No. 1. Medtronic objected to MFV's interrogatory, maintaining that the burden to prove infringement rested on MFV and that MFV had failed to provide its infringement contentions. Medtronic ultimately responded to the interrogatory with reasons why it felt that its products do not infringe MFV's patents. On the date expert reports were due, Medtronic served the report of its expert, Dr. Charles Love (“Love”). MFV subsequently served the report of its expert, Dr. Ronald Berger (“Berger”). Consistent with MFV's contention that Medtronic bore the burden to prove noninfringement as it alleged in its complaint, Berger's report was largely responsive to Love's report, and Berger admitted that he did not expressly map the products in question to every limitation of the relevant claims. Medtronic, Inc. v. Boston Scientific Corp., 777 F.Supp.2d 750, 768–69 (D.Del.2011) (“Opinion ”).

The district court held a bench trial on January 25–28, 2010, and March 13, 2010. The court relied on Under Sea Industries, Inc. v. Dacor Corp., 833 F.2d 1551, 1557 (Fed.Cir.1987), which states that “[t]he burden always is on the patentee to show infringement,” and thus held that “[a]s the parties asserting infringement, defendants bear the burden of proof by a preponderance of the evidence.” Opinion at 766. “Having determined that defendants, as patentees, have the burden to prove infringement,” id. at 767, the court found that Berger's testimony lacked sufficient foundation because of his failure to consider “each limitation of each asserted claim in comparison to each accused product before rendering his infringement opinions,” and that defendants “failed to prove literal infringement by a preponderance of the evidence,” id. at 769. The court also found Berger's report and testimony conclusory and insufficient to show that the products infringe the patents under the doctrine of equivalents. Id. at 769–70.

Finally, the district court, in conducting its claim construction, relied on portions of the specification that describe the invention in the context of treating congestive heart failure to construe the preamble terms “improving the hemodynamic efficiency of a heart,” RE'119 Patent col. 10 ll. 1–2, 25–26, and “bi-ventricular pacemaker,” RE'119 Patent col. 11 l. 1, col. 12 l. 1, as limited to the treatment of congestive heart failure. Opinion at 763–64; see, e.g., RE'119 Patent col. 1 ll. 18–22 (stating in the specification that “[t]his invention pertains to ... a method for increasing the cardiac output of a patient suffering from congestive heart failure by stimulating the heart of the patient at multiple sites simultaneously”), col. 3 ll. 13–15 (stating in the specification that “an objective of the present invention is to provide a cardiac pacer for increasing hemodynamic efficiency of a heart experiencing a conduction deficiency.”).

MFV appeals the district court's grant of declaratory judgment of no literal infringement and no infringement under the doctrine of equivalents. Medtronic cross appeals the district court's claim construction ruling. This court has jurisdiction pursuant to 28 U.S.C. § 1295(a)(1).

II. Discussion

A. Standard of Review

Claim construction is a question of law that this court reviews de novo. Cybor Corp. v. FAS Techs., 138 F.3d 1448, 1451 (Fed.Cir.1998) (en banc). This court also reviews a district court's other legal conclusions, such as who bears the burden of proof, de novo. Madey v. Duke Univ., 307 F.3d 1351, 1358 (Fed.Cir.2002).

B. Burden of Proof

MFV argues that because Medtronic is the declaratory judgment plaintiff—the party seeking court action—Medtronic bore the burden of proving noninfringement, a burden it failed to carry. MFV further explains that because of the parties' licensing agreement, it could not have filed a counterclaim for infringement and the court erred by viewing MFV as a party “asserting infringement.” Opinion at 766. MFV points out that all of the cases the district court relied on to conclude that MFV bore the burden to prove infringement are conventional claims for patent infringement by the patentee as contrasted with declaratory judgment actions by licensees. MFV also points out that the parties' agreement requires Medtronic to initiate litigation by filing a declaratory judgment action, as it has done in this case, making Medtronic the party seeking relief from the court. Thus, according to MFV, because Medtronic filed a complaint seeking a judgment that its products do not infringe MFV's patents, Medtronic should have to prove that at least one limitation of each claim of MFV's patents is not met by Medtronic's products.

Medtronic counters that, as the district court held, the burden of proving patent infringement...