W.L. Gore & Assocs., Inc. v. Medtronic, Inc.

• Citation: 850 F.Supp.2d 630
• Decision Date: 03 February 2012
• Docket Number: Civil Action No. 2:10cv441.
• Court: United States District Courts. 4th Circuit. United States District Court (Eastern District of Virginia)
• Parties: W.L. GORE & ASSOCIATES, INC., and Gore Enterprise Holdings, Inc., Plaintiffs, v. MEDTRONIC, INC., Medtronic USA, Inc., and Medtronic Vascular, Inc., Defendants.

850 F.Supp.2d 630

W.L. GORE & ASSOCIATES, INC., and Gore Enterprise Holdings, Inc., Plaintiffs,
v.
MEDTRONIC, INC., Medtronic USA, Inc., and Medtronic Vascular, Inc., Defendants.

Civil Action No. 2:10cv441.

United States District Court,
E.D. Virginia,
Norfolk Division.

Feb. 3, 2012.

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Ahmed Jamal Davis, Fish & Richardson P.C. (DC), Washington, DC, Juanita Rose Brooks, Fish & Richardson P.C. (CA–NA), San Diego, CA, Robert M. Oakes, Susan Morrison Coletti, Timothy Devlin, Fish & Richardson (DE NA), Wilmington, DE, for Plaintiffs.

Dabney Jefferson Carr, IV, Rachel Clark Hughey, Richmond, VA, Ahmed Jamal Davis, Fish & Richardson P.C. (DC), Washington, DC, Daniel William McDonald, Karen Diane McDaniel, Rachel Clark Hughey, Thomas Joseph Leach, Merchant & Gould P.C., Minneapolis, MN,

[850 F.Supp.2d 632]

James Joseph Elacqua, Palo Alto, CA, Peter Attila Gergely, Ryan James Fletcher, Merchant & Gould P.C., Denver, CO, for Defendants.

OPINION AND ORDER
MARK S. DAVIS, District Judge.

Plaintiffs W.L. Gore & Associates, Inc. and Gore Enterprise Holdings, Inc. (collectively “Gore”) filed this action against Defendants, Medtronic, Inc., Medtronic USA, Inc., and Medtronic Vascular, Inc. (collectively “Medtronic”), alleging that Medtronic infringed upon Gore's U.S. Patent No. 5,810,870 (“the '870 patent”), entitled “Intraluminal Stent Graft.” Medtronic, in turn, has asserted various affirmative defenses and counterclaims. Gore's Motion to Dismiss Medtronic's Inequitable Conduct Counterclaim, under Federal Rule of Civil Procedure 12(b)(6), is presently before the Court. For the reasons discussed below, the motion will be DENIED.

I. FACTUAL AND PROCEDURAL BACKGROUND

On September 3, 2010, Gore filed a complaint against Medtronic alleging patent infringement. Gore alleges that Medtronic's Talent Thoracic Stent Graft and its Talent Abdominal Stent Grafts infringe claims 12, 16 and 19 of the ' 870 patent which are directed to methods of making a tubular intraluminal graft disclosed in the patent. On November 19, 2010, Medtronic filed a Motion to Dismiss Plaintiff's Complaint. On April 20, 2011, 778 F.Supp.2d 667 (E.D.Va.2011), this Court denied the Defendant's Motion to Dismiss. Gore then filed an Amended Complaint on April 26, 2011, and Medtronic filed an Answer and Counterclaim on May 10, 2011.

Medtronic has asserted three counts in its counterclaim: (1) non-infringement, (2) invalidity, and (3) unenforceability due to inequitable conduct. Gore now moves to dismiss Medtronic's inequitable conduct count under Federal Rule of Civil Procedure 12(b)(6). Medtronic's inequitable conduct count can be broken into three allegations:

(1) House and Myers (the inventors named in the '870 patent) intentionally withheld material prior art (specifically U.S. Patent Nos. 5,358,516 (the ' 516 patent) and 5,397,628 (the '628 patent)).

(2) House and Myers intentionally mischaracterized references they disclosed to the Patent Office (specifically, U.S. Patent Nos. 5,123,917 (the '917 patent), 5,107,852 (the '852 patent), 4,768,507 (the '507 patent), and German Patent No. 3,918,736 (the'736 patent)).

(3) House and Myers submitted a false affidavit to the patent office by signing the standard inventor oath (stating they believed they were the “original, first and joint inventors”) required to be filed with the patent application.

II. STANDARD OF REVIEW

Application of Rule 12(b)(6) in patent cases is a procedural question and is therefore governed by the law of the regional circuits. McZeal v. Sprint Nextel Corp., 501 F.3d 1354, 1355–56 (Fed.Cir.2007) (“A motion to dismiss for failure to state a claim upon which relief can be granted is a purely procedural question not pertaining to patent law. Thus, on review [this Court must] apply the law of the regional circuit.”); Polymer Indus. Prods. Co v. Bridgestone/Firestone, Inc., 347 F.3d 935, 937 (Fed.Cir.2003) (same). In the Fourth Circuit, “[t]o survive a motion to dismiss pursuant to 12(b)(6), plaintiffs' ‘[f]actual allegations must be enough to raise a right to relief above the speculative level,’ thereby

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‘nudg[ing] their claims across the line from conceivable to plausible.’ ” Aziz v. Alcolac, Inc., 658 F.3d 388, 391 (4th Cir.2011)(quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). Although a court must accept the material facts alleged as true, statements of bare legal conclusions will be insufficient to state a claim. Id.

Although most unenforceability defenses need not be pled with particularity, the defense of inequitable conduct is an exception. Rule 9(b) of the Federal Rules of Civil Procedure states that: “In alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake. Malice, intent, knowledge, and other conditions of a person's mind may be alleged generally.” Fed.R.Civ.P. 9(b); see Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 1949–50, 173 L.Ed.2d 868 (2009) (although intent may be averred generally, “threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice”). Whether inequitable conduct has been adequately pleaded is a question of Federal Circuit law, not the law of the regional circuit, because it “pertains to or is unique to patent law.” Exergen Corp. v. Wal–Mart Stores, Inc., 575 F.3d 1312, 1326 (Fed.Cir.2009) (citing Cent. Admixture Pharm. Servs. v. Advanced Cardiac Solutions, P.C., 482 F.3d 1347, 1356 (Fed.Cir.2007)). Thus, to survive a motion to dismiss under Fed.R.Civ.P. 12(b)(6), an inequitable conduct counterclaim or affirmative defense must satisfy Fed.R.Civ.P. 9(b)'s particularity standard and “identify the specific who, what, when, where and how of the material misrepresentation or omission committed before the PTO.” Exergen, 575 F.3d at 1328 (emphasis added). Although under Rule 9(b), “knowledge” and “intent” may be alleged generally, a pleading of inequitable conduct must include sufficient facts from which a Court can “reasonably infer that a specific individual both knew of invalidating information that was withheld from the PTO and withheld that information with a specific intent to deceive the PTO.” Delano Farms Co. v. Cal. Table Grape Comm'n, 655 F.3d 1337, 1350 (Fed.Cir.2011).¹ “A reasonable inference is one

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that is plausible and that flows logically from the facts alleged, including any objective indications of candor and good faith.” Exergen, 575 F.3d at 1329. The Court must accept all allegations of material fact and construe them in the light most favorable to the nonmoving party. See Nemet Chevrolet, Ltd. v. Consumeraffairs.com, Inc., 591 F.3d 250, 253 (4th Cir.2009) (noting that in ruling on a motion to dismiss, the district court must assume all well-pleaded facts to be true).

Thus, with the above standards in mind, the Court will now assess Medtronic's three theories of inequitable conduct.

III. DISCUSSION A. Undisclosed Prior Art

Medtronic first alleges that Wayne D. House, a Gore employee and the prosecuting attorney/agent for the '870 patent, intentionally withheld U.S. Patent No. 5,358,516 (the '516 patent) and U.S. Patent No. 5,397,628 (the '628 patent) with specific intent to deceive the PTO. (Def.'s Answer and Counterclaim ¶ 45, Docket No. 69). Medtronic similarly alleges that David J. Myers, a Gore employee and the listed inventor of the '870 patent, intentionally withheld the...