Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_06-cv-00333/USCOURTS-cand-3_06-cv-00333-4/pdf.json

Parties Involved:
Cook Incorporated
Plaintiff
Medtronic Vascular, Inc.
Defendant
Medtronic, Inc.
Defendant

Document Text:

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

COOK INCORPORATED,

Plaintiff,

 v.

MEDTRONIC, INC., and MEDTRONIC

VASCULAR, INC.,

Defendants.

 /

No. C 06-00333 JSW

NOTICE OF TENTATIVE

RULING AND QUESTIONS FOR

HEARING

TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD, PLEASE TAKE

NOTICE OF THE FOLLOWING TENTATIVE RULING AND QUESTIONS FOR THE

HEARING SCHEDULED ON JUNE 2, 2006, AT 9:00 A.M.:

The Court has reviewed the parties’ memoranda of points and authorities and, thus, does

not wish to hear the parties reargue matters addressed in those pleadings. If the parties intend to

rely on authorities not cited in their briefs, they are ORDERED to notify the Court and opposing

counsel of these authorities reasonably in advance of the hearing and to make copies available at

the hearing. If the parties submit such additional authorities, they are ORDERED to submit the

citations to the authorities only, without argument or additional briefing. Cf. N.D. Civil Local

Rule 7-3(d). The parties will be given the opportunity at oral argument to explain their reliance

on such authority.

The parties each shall have twenty-five (25) minutes to address the following questions:

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Motion to Dismiss Pursuant to Rule 12(b)(1)

The Court tentatively DENIES Medtronic’s Motion to Dismiss for Lack of Subject

Matter Jurisdiction.

1. The Court’s understanding of the relief Cook seeks by way of declaratory relief is

as follows: (1) an interpretation of paragraphs 4.1.2 and 4.8 of the Settlement

Agreement; (2) a declaration that Medtronic’s warranties regarding ownership

were untrue because Fogarty may not have been the first to invent; (3) a

declaration that Medtronic’s representations that it listed all of the patents that it

owned within the field of use were untrue because it did not list the White/Yu

patents; and (4) a declaration that because of these alleged misrepresentations,

Medtronic is required to indemnify and/or defend Cook because it did not keep

the patent rights Medtronic licensed to Cook free from encumbrances. Is this

understanding of Cook’s position correct?

a. If the Court is correct in its understanding, why would the Court not have

jurisdiction to consider and resolve at least the first and third issues,

which would not require any determination of who was the first to invent

the subject matter of the patents and/or patent applications?

b. As to Medtronic’s contention that this Court has no jurisdiction to

conduct an interference, Cook’s Complaint and Exhibit B to the

Takenouchi declaration refer to patents that claim priority to the Fogarty

application. As such, what is the impact of the issuance of patents on

Medtronic’s argument that what Cook seeks is an interference, rather than

an intefering patent suit? See, Albert v. Kevex Corp., 729 F.2d 757, 758

n.1 (Fed. Cir. 1984).

c. Does Cook concede that with respect to the second issue set forth in the

preamble to this question, it asks the Court to make a declaration as to

who has priority of invention with respect to the subject matter of the

patents and/or patent applications? To resolve the “first to invent”

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question, would Cook concede that the Court would have to determine

that issued patents are, in fact, interfering patents? If so, as to issued

patents why is Cook not, in effect, asking the Court to conduct an

interference action, albeit one over which it would have jurisdiction? 

2. At page 5 of its Opposition to Medtronic’s motion to dismiss, Cook contends that

the issue in this case is “when and where White/Yu first invented the modular,

bifurcated, stent-graft device, and whether it occurred before Fogarty’s alleged

invention of the same device. The main difference between the two actions is

that, instead of just looking at White/Yu’s inventive activities, as was done in the

L.A. Biomed action, here the inventive activities of both White/Yu and Fogarty

need to be considered.” It is the Court’s understanding that Cook intends to

raise that question as a defense to the Edwards litigation. 

a. Is the Court’s understanding correct?

b. Would Cook concede that to resolve what it claims to be a dispute

over ownership is, in fact, a request that the Court determine

inventorship? 

c. Would Cook concede that if the question of inventorship is

resolved in its favor in the Edwards litigation, than this action

becomes moot? If so, why is this action not premature?

3. What language in the Settlement Agreement supports Cook’s position that it is

entitled to be indemnified for costs “incurred in securing and maintaining a

license from L.A. Biomed under the ‘485 and ‘073 patents, including all

litigation support amounts paid by Cook to, or on behalf of L.A. Biomed?” (See

Complaint ¶ 124; Opp. at 14.)

4. In light of the fact that the Complaint contends Cook is entitled to be indemnified

for amounts it incurred to obtain a license from L.A. Biomed, if the Court accepts

the allegations in the Complaint with respect to Medtronic’s potential liability as

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true, what is Medtronic’s best argument that the amount in controversy

requirement is not satisfied?

Motion to Dismiss Pursuant to Rule 12(b)(6)

The Court reserves issuing a tentative ruling on the motion to dismiss for failure to state

a claim, but tentatively DENIES Medtronic’s requests for a more definite statement and to

strike portions of Cook’s Complaint.

1. a. Does Cook contend that any of the provisions of the Settlement

Agreement are ambiguous? 

b. If so, which provisions and what is the specific interpretation that it

proposes? 

c. Will Cook rely on any extrinsic evidence to show that the purported

ambiguities or alternative interpretations exist? If so, what is that

evidence?

d. Does Medtronic agree that, to determine whether an ambiguity exists, the

Court can provisionally receive any extrinsic evidence Cook may wish to

offer? See Wolf v. Superior Court, 114 Cal. App. 4th 1343, 1350-51

(2004). If so, how can this matter be resolved by way of a motion to

dismiss? 

2. Is Cook asking the Court to interpret the first sentence of paragraph 4.8 as

follows: “Medtronic (on its own behalf and on behalf of each of its Affiliates)

hereby represents and warrants to Cook that, as of the Effective Date, the

Licensed Medtronic Patents constitute all of the patents and patent applications

owned by Medtronic within the Field of Use including those acquired by

Medtronic or its Affiliates as a result of Medtronic, Inc.’s acquisition of AneuRx,

Inc. And World Medical Manufacturing Corp.?” 

a. If not, what is Cook’s proposed interpretation of this sentence?

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b. Given the plain language of the Settlement Agreement as to the definition

of “Licensed Medtronic Patents,” what is Cook’s best argument that the

White/Yu patents fall within that definition?

3. a. If the Court rejects Cook’s interpretation of paragraph 4.8, does that

render its claims with respect to paragraph 4.1.2 moot? If not, why?

b. The Settlement Agreement provides that Medtronic warranted and

represented that “it owns all right and title to the patents licensed by it

hereunder,” not that Medtronic “owns all right and title to the subject

matter claimed by the patents licensed by it hereunder.” Is Cook’s

position that this is a distinction without a difference? If not, given this

language, what is Cook’s best argument that its “first to invent” position

can be reconciled with paragraph 4.3? 

c. Does Cook have any authority construing similar “all right and title”

language to mean that such a representation equates to a representation

regarding first to invent?

d. Can Cook represent to the Court that it was unaware of the White and Yu

patents at the time it entered into the Settlement Agreement? If not, why

should the Court not assume that those patents were not intended to be

included in the Settlement Agreement?

4. Cook appears to argue that many of the alleged representations and warranties

are implied, e.g., the exemption relating to a loss in the interference regarding the

Fogarty’s ‘836 application implies that other similar losses would constitute a

breach. How can Cook square such arguments with paragraph 4.4.2?

5. In reply Medtronic argues that, with respect to the interference proceeding

referenced in paragraph 4.1.2, “[t]he ultimate inquiry for the PTO in the course of

that proceeding was who among different individuals was entitled to a patent for

a particular subject matter.” (Reply at 7.) Was that proceeding based on a

priority dispute? If so, the Court does not appreciate the import of footnote 4, in

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which Medtronic attempts to distinguish the Novo Nordisk case on the ground

that it “relates to entitlement to a patent when there is a priority dispute, and not a

dispute over the title to an issued patent.”

7. Section 15.1 makes reference to a “Parent Guaranty.” Is that document in the

record? If not, does it contain representations that impact either party’s

arguments?

Dated: June 1, 2006 

JEFFREY S. WHITE

UNITED STATES DISTRICT JUDGE

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