## United States Court of Appeals for the Federal Circuit

05-1518, -1534, -1575

OPTIVUS TECHNOLOGY, INC., Plaintiff-Appellant, and LOMA LINDA UNIVERSITY MEDICAL CENTER, Plaintiff-Appellant,

v.
ION BEAM APPLICATIONS S.A., Defendant-Cross Appellant.

Howard B. Miller , Girardi & Keese, of Los Angeles, California, argued for plaintiffappellant Optivus Technology, Inc. John W. Holcomb , Knobbe, Martens, Olson & Bear, LLP, of Riverside, California, argued for plaintiff-appellant Loma Linda University Medical Center. With him on the brief were William B. Bunker , Paul A. Stewart , David G. Jankowski , and John N. Kandara , of Irvine, California. Of counsel was Abraham W. Chuang

. Brian E. Ferguson , McDermott Will & Emery LLP , of Washington, DC, and Mark P. Wine , of Los Angeles, California, argued for defendant-cross appellant. With them on the brief were Charles Rosenberg and Cynthia A. Lock , of Los Angeles, California. Appealed from: United States District Cour t for the Central Dis trict of California Judge S. James Otero

## United States Court of Appeals for the Federal Circuit

05-1518, -1534, -1575

OPTIVUS TECHNOLOGY, INC., Plaintiff-Appellant, and LOMA LINDA UNIVERSITY MEDICAL CENTER, Plaintiff-Appellant,

v.
ION BEAM APPLICATIONS S.A., Defendant-Cross Appellant.

__________________________ DECIDED: November 16, 2006

__________________________ Before BRYSON, Circuit Judge , ARCHER, Senior Circuit Judge , and LINN, Circuit Judge

. LINN, Circuit Judge

. Optivus Technology, Inc. (“Optivus”) and Loma Linda University Medical Center (“Loma Linda”) appeal from a fi nal judgment of the United St ates District Court for the Central District of California. Optivus challenges the district court’s order dismissing its claim under California unfair competition la w and granting summary judgment to Ion Beam Applications S.A. (“I BA”) on Optivus’s claims for a violation of the Florida Deceptive and Unfair Trade Practices Act, fo r a violation of the Lanham Act, and forintentional interference with pros pective economic advantage. Optivus Tech., Inc. v. Ion Beam Applications S.A. , No. CV 03-2052 SJ O (VBKx) (C.D. Cal. Dec. 30, 2004) (“ Unfair Competition Claims Order ”). Loma Linda challenges the di strict court’s order granting summary judgment of invalidity for U.S. Pa tent Nos. 4,870,287 (the “’287 patent”) and 5,260,581 (the “’581 patent”) and su mmary judgment holding that IBA did not infringe the ’287 patent. Optivus Tech., Inc. v. I on Beam Applications S.A. , No. CV 03-2052 SJO (VBKx) (C.D. Cal. Mar. 13, 2005) (“ Patent Claims Order ”). On cross-appeal, IB A challenges the distric t court’s denial of its motion to amend the pleadings. Optivus Tech., Inc. v. Ion Beam Applications S.A. , No. CV 03- 2052 SJO (VBK x) (C.D. Cal. Dec. 29, 2004) (“ Motion to Amend O r der ”). We conclude that t he district court erred in dismissing Optivus’s Californ ia unfair com petition law cl aim and in granting summary judgment on Optivus ’ s Lanham Act claim

. We otherwise affirm the district court’s rulings. Thus, we affirm-in-part, reverse-in-part, and remand. BACKGROUND Optivus and Loma Linda are the purport ed exc l usiv e licens ee and assig nee , respectively, of the ’287 and ’581 patents, wh ich relat e to the us e of proton beams in cancer therapy. The ’287 patent is direct ed to a proton beam therapy facility that generates a proton beam and deliv ers it to one of multiple treatm ent rooms. The
treatment rooms are equipped with movable gantries that enable an operator to direct the beam to a patient at a s pecific angle. The proton beam therapy system is illustrat ed in figure 1 of the ’287 patent, which is reproduced below.

05-1518, -1534, -1575 2Claim 1 of the ’287 pat ent is the only independent claim and pr ovides, in relevant part: 1. A proton beam therapy system comprising: a plurality of separate patient treat ment stations each having a patient support for orienting a patient in a fixed position; a source of protons; an acceler a tor for accelerating pr otons as a beam; an injector for transporting protons fr om the source to the acceler a tor ;

. . . a gantry at each treatment station each rot a table about a different axis of rotation and carrying optics for receiving a proton beam on its axis o f rotation, transporting the proton beam away from the axis of rotation and returning the proton beam on a path perpendicular to and intersecting the axis at a target isocenter within t he patient whereby with rotation of the gantry the prot on beam is delivered to the target isocenter from several different angles and

. . . a control system for the proton beam therapy syst em including an operator controllable means for (1) selectively s witchin g the first switching magnet between its first and s e cond st at es and (2) controlling the rotational position of the first gantry to direct the proton beam exiting the first switching magnet in its first state to the target isocenter for the first treatment station along on e or more controlled angles.

05-1518, -1534, -1575 3’287 patent , col. 14, ll. 1-40. The highlight ed limitations are at issue on appeal and ar e termed, respectively, as the “injecto r” and “controllable means” limitations. The ’581 patent is directed to a safety system for a multi -room proton beam therapy facility that verifies a treatment room selection befo re the proton beam is sent. A flow diagram of a preferr ed form of the safety system is depicted in figure 4 of the ’581 patent , which is reproduced below.

Claim 1 of the ’581 pat ent is the broadest claim and provides: 1. A method of treatment room sele ction verification in a radiation beam therapy system comprising radiatio n beam source, beam ac celerator, plurality of treatment r ooms and a s witchyard for directing acc e lerated beam from the accelerator to a select ed one of the treat ment rooms, the method comprising the steps of: (a) receiving a beam request signal fr om one or more of the treatment rooms; (b) verifying the authenticit y of one of the beam r equest signals from one of the treatment rooms ; and (c) authorizing beam transport to t he one of the treatment rooms. ’581 patent, col. 9, ll. 1-12. The highligh ted limitation is at is sue on appeal and is termed the “verifying” step. Also at iss ue is the “beam path co nfiguration signal” limitation, which is pr esent in claims 2-13. See id. , col. 9, ll. 15, 22, 38-39.

05-1518, -1534, -1575 4Optivus and IBA are competitors engage d in the business of marketing and selling proton beam therapy systems. The Univ ersity of Florida (“Florida”) was interested in such a system and signed a non-bi nding letter of inte nt with Optivus in 1999. That letter ulti mately expired on March 15, 2000. After expiration of the letter of intent, Florida gav e s e rious consideration to other vendors and eventually awarded a contract to IBA. In August 2002, Opti vus sued IBA for patent infringement. The complaint was later amended to add Loma Li nda as a co-plaintiff and to include additional claims for, inter alia , unfair competition under California law, see Cal. Bus. & Prof. Code §§ 17200-17210, (the “Califor nia unf air competition law” claim); unfair competition under the Flor ida Deceptive and Unfa ir Trade Practic e s Act, see Fla. Stat. §§ 501.201-501.213, (the “Florida Unfair Trade Act” claim); unfair competition under section 43( a) of the Lanham Act, see 15 U.S.C. § 1125(a), (the “Lanham Act” claim); and intentional interference wit h prospective economic advant age under Florida tort law (the “intentional interference” claim). IBA filed counterclaims seeking, inter alia , declaratory judgments of invalidit y and non-in fringement of the ’287 and ’581 patents. The district court held a claim construction hearing on August 6, 2004 and f iled an order construing the relevant limita tions of the ’287 a nd ’581 pat ents. Optivus Tech., Inc. v. Ion Beam Applications S.A. , No. CV 03-2052 SJO (VBKx) (C.D. Cal. Aug. 31, 2004) (“ Claim Construction Order ”). On November 24, 2004, IBA request ed leav e to amend its answer to add a defens e of unenforceability of th e patents at issue due t o inequitable conduct; the court denied IBA’s request. Motion to Amend Order , slip op. a t 7. On December 30, 2004, the district cour t dismissed the Califor nia unfair c o mpetition law cla i m for failure to exh aust administrative remedies. Unfair Competition Cla ims

05-1518, -1534, -1575 5Order , slip op. at 23-25, 36. The district court also granted summary judgment to IBA on the F l orida Unfair Trade Ac t claim, t he Lanham Act claim, and the intentiona l interference claim. Id

. , slip op. at 25-36. On March 13, 2005, the district court granted summary judgment that the ’287 and ’581 patents are in valid and that the accuse d products do not infringe the ’287 patent. Patent Claims Order , slip op. at 11-44, 53. On appeal, Optivus challenges the district court’s dismis sa l of its California unfair competition law claim and the court’s grant of summary judgment to IBA on its Florida Unfair Trade Act, Lanham Ac t, and intentiona l interference claims. Loma Lind a challenges the court’s grant of summary judgment of inva lidity of the ’287 and ’581 patents and summary judgment of non-infringement of t he ’287 patent. On cros sappeal, IBA challenges the district court’s denial of I BA’s motion to amend its answer to include a defense of inequitable conduct. 1 We have jurisdiction under 28 U.S.C. § 1295(a)(1). DISCUS SION I. Standard of Review “We review a district c our t’s grant of summary judgment de nov o .” Ethicon En doSurgery, In c. v. U.S. Surgical Corp. , 149 F.3d 1309, 1315 (Fed. Cir. 1998). Summa ry judgment is proper only if there are no genuine i ssues of material fa ct and the movant is entitled to judgment as a matter of law. Se e Fed. R. Civ. P. 56( c); Anders on v. Libert y Lobby, Inc. , 477 U.S. 242, 250 (1986).

1 IBA initially raised a conditiona l “cross-appeal” c h allen g ing the court’s construction of the “injector” limitation in the ’287 patent, but has conceded in its reply brief that such an argument is an alternat ive grounds for affirming the judgment of noninfringement and is not a proper cross-appeal. See, e.g. , Bailey v. Dart Con t ainer Corp. of Mich. , 292 F.3d 1360, 1362 (Fed. Cir. 2002).
05-1518, -1534, -1575 6Because the question of whether the adminis trative remedies in t h is cas e have been exhausted is a question not unique t o our ex c l usive jurisdiction, we apply the law of the regional circuit in whic h the district court sits. See Midwest Indus., Inc. v. Karavan Tr ailers Inc. , 175 F.3d 1356, 1359 (F ed. Cir. 1999) (en banc in relevant part). In the Nint h Circu it, on a d i smiss a l for failur e to exhaust non-judicial remedies, a district court’s underlying fact ual determinations are re viewed f o r clear error and its a p plic ation of substantive law is reviewed de novo

. Ritza v. Int’l Longshoremen’s & Warehousemen’s Union , 837 F.2d 365, 369 (9th Cir. 1988). Claim construction is an issue of law, see Markman v. Westview Instru ments, Inc. , 52 F.3d 967, 970-71 (Fed. Cir. 1995) (en banc), aff’d , 517 U.S. 370 (1996), that we review de novo

. See Phillips v. AWH Corp

. , 415 F.3d 1303, 1328 (Fed. Cir. 2005) (en banc); Cybor Corp. v. FAS Techs., Inc. , 138 F.3d 1448, 1456 (Fed. Cir. 1998) (en banc). Whether an invent ion would have been obvious is a legal conclus i on based o n underlying factual findings suc h as t he scope and content of the prior art, Graham v. John Deere Co. , 383 U.S. 1, 17 (1966), and the exis tence of a motivation to combine prior art references, In re Kahn , 441 F.3d 977, 985 (Fed. Cir. 2006). Infri n gement, whether literal or under the doctrine of equivalents, is a question of fact. Ferguson Beauregar d v. Mega Sys., Inc. , 350 F.3d 1327, 1338 (Fed. Cir. 2003). “In review of an order deny ing a motion to amend, a subj ect which is not unique to patent law, we look to the law of the r egional circuit court.” Kalman v. Berlyn Corp. , 914 F.2d 1473, 1480 (Fed. Cir. 1990). “In the Ninth Circuit, the denial of a motion to amend is reviewed for abuse of discretion.” Filmtec Corp. v. Hydranautics , 67 F.3d 931,

05-1518, -1534, -1575 7935 (Fed. Cir. 1995) (citing DCD Programs, Lt d. v. Leighton , 833 F.2d 183, 186 (9th Cir. 1987)). II. Unfair Competition Cla ims A. The California Unfair Competition Law Claim The distric t court noted that the gr avamen of Optivus’s California unfair competition law claim was that IBA mark eted a medical devic e that had not been approved by the Food and Drug Administrati on (“FDA”) as evidenced by a letter from the FDA to IBA. Unfair Competition Claim s Order , slip op. at 23. Although the court determined that Optivus could v a lidly bring s u ch a claim under California law “so long as [the claim] is not related to the requirements of the medical devic e, but is instead related to, for example, false advertising,” the court ultimately concluded that the FDA letter was not a final determination and that Optivus mu st first exhaust administrative remedies before it could pursue t he California unfair competition law claim. See id. , slip op. at 25 (“If Optivus is going to bring suit on the basis of FDA action, that su it must be based on a final agency determination and not an interim letter.”). Optivus argues that the district court e rred in dismiss i ng the California unf a ir competition law claim as “non-ju sticiable” based on a failure to exhaust administrative remedies, contending that ther e is no administrative proce ss that Optivus could have exh austed before filin g suit. IBA counters that the Califo rnia unfair competition la w cl ai m i s based on a FD A regul a tory l e tter to IBA, that the letter was not a final determination, and that the court was correc t in concluding that the administrative process must be exhausted before a Califor nia unfair competition law claim can proceed based on s u ch a letter. Alternativ ely, IBA argues that we should affir m

05-1518, -1534, -1575 8summary judgment because no pr ivate right of action exists to enforce the Federal Food, Drug, and Cos m etics Act (the “Act”). In reply, Optivus argues that a final FDA determination is not needed to prove that IBA violated the Act and that precedent in California establishes that a California unf air competition law cl aim can be based on a regulatory violation that could not be directly enforced by a private right of acti on. As support for its conclusion that Optivu s must first exhaus t administrative remedies, the district court cited Biotics Research Corp. v. Heckler , 710 F.2d 1375 (9t h Cir. 1983), Dietary Supplement al Coalit ion, Inc. v. Sullivan , 978 F.2d 560 (9th Cir. 1992), and Estee Lauder, Inc. v. United States Food & Drug Adminstration , 727 F. Supp. 1 (D. Colo. 1989). We find these case s inapposite to Optivu s’s California unfair competition law claim. All three cases involv e situations in whic h the plaintiffs sought judicial rev i ew of an FDA action that the court concluded was not final. See Biotics Research , 710 F.2d at 1376, 1378; Dietary Supplem e ntal , 978 F.2d at 562, 563-64; Estee Lauder , 727 F. Supp. at 1, 4-6. In such a situation, “one seeking to contest the agency’s determination must exhaust all adm inistrative remedies befor e seeking review.” Biotics Research , 710 F.2d at 1377. Here, Optivus is not seeking to contes t an agency determination; rather, it is claiming that IBA engaged in unfair competition under California law by m a rketing a medical device without FDA appr oval. In that respect, Optivus is not before an ag ency and has no administrative remedy to exhaust. Wh ile the significance of the FDA letter is an issue to be determined in ass e ssing whether California unfair competition law has been violat ed, the determination of that i ssue does not require the exhaus tion of an

05-1518, -1534, -1575 9administrative remedy. We ther efore conclude that the district court erred in dismissing the California unfair competition law claim for failure to ex haus t administrative remedies. We also find IBA’s alternative argument unpersuasive. Alt hough t he Act prov ides that no private right of action exists to redr ess alleged violations of the Act, 21 U.S.C. § 337, the California Supreme Court has inte rpreted California unf air competition la w such that “a private plaintiff may bring [an unfair competition law] action even whe n ‘the conduct alleged to constitute unfair competit ion violates a s t atute for the direct enforcement of which there is no private right of action.’” Kasky v. Nike, Inc. , 27 Cal. 4th 939, 950 ( 2002) (quoting St op Youth Addiction, In c. v. Lucky Stores, Inc. , 17 Cal. 4th 553, 565 (1998)). Accordingly, we r e vers e the district court’s dismissal of this claim. 2
B. The Florida Unfair Trade Act Claim The parties agree that prior to July 1, 2001, only a consumer could bring a claim under the Florida Dec eptive and Unfair Trade Practic e s Act. Se e Fla. Stat. § 501.211, Historical & Statutory Notes (not ing the ch ange in sect ion 501.211( 2) from “consumer” to “person,” effective July 1, 2001). The di strict court thus required Optivus to allege that IBA engaged in c onduct violating the Flor ida Deceptive and Unfa ir Trade Practices Act after that date in order to recover damages under its Flor ida Unfair Trad e Act cla i m. The district court noted that the only alle ged misconduct that occurred after July 1, 2001

2 IBA cites as supplemental authority the recent decision of a Court of Appeal of the State of California in Farm Raised Salm on Cases , 48 Cal. Rptr. 3d 449 (Cal. Ct. App. 2006), dismissing a suit filed under California unfair competition la w as preempted by the Act. Because IBA did not argue preemption in this appeal, the question of preemption is not before us, and we decline to address it on the merits. By declining t o address this issue, we do not mean to foreclose whatever right IBA may have to raise the issue of preemption before the district court on remand.
05-1518, -1534, -1575 10was that IBA marketed its device without FD A appr oval for eleven days. The court concluded that this marketing ac tivity was inconsequential bec au se Florida had already chosen IBA as its vendor for a new prot on therapy system in September 2000. Unfair Competitio n Claims Order , slip op. at 26-27. Optivus argues that summary judgment on the Florida Unfair Trade Act claim was not proper because the district court er red in conc luding that IBA’s misco nduct after July 1, 2001 was inc o nsequential. Specifically, Optivus argues that the loss it suffered occurred after July 1, 2001 when IBA and Florida entered into a binding purchase agreement on Decem ber 1, 2002. IBA coun ters that the alleged misconduct and harm both occurred before July 1, 2001 and thus are not compensab le under the statute that was effective at that ti me. Optivus’s focus on when the loss occurr ed, as opposed to when the conduct occurred, ignores the principle that legislatio n is presumed not to be retroactive and that “the legal effect of conduct should ordinar ily be assessed under the law that existed when the conduct took place.” See Lan d g raf v. USI Film Prod s. , 511 U.S. 244, 265 (1994) (quoting Kaiser Aluminum & Chem. Corp. v. Bonjorno , 494 U.S. 827, 855 (1990) (Scalia, J., concurring)). Op tivus does not identify, and we hav e not found, any reason to depart from this principle. Here, it is undisputed t hat Florida selected IBA as its vendor in September 2000. In th is case, it was that selecti on of IBA over Optivus that created Optivus’s loss , not the formal signing of a purchase agreement. Accordingly , the district court did not er r in awarding summary judgment to IB A on this claim.

05-1518, -1534, -1575 11C. The Lanham Act Claim The district noted that in order to pr evail on the Lanham Act claim, Optivus must demonstrate, inter alia , that IBA made a false statement of fact and the statement was material. Unfair Com petition Cla i ms Order , slip op. at 29 (quoting Southland Sod Farms v. Stover Seed Co. , 108 F.3d 1134, 1139 (9th Cir. 1997)). The c ourt ultimately concluded that the stat ements identified by Optivus were not material for purposes of the Lanham Act claim. Id. , slip op. at 30-34. Optivus argues that an issue of fact exis ts as to whether IBA made a materially false or misleading s t atement—an elemen t of its Lanham Act claim—that caused Optivus not to be awarded the contract with Fl orida. Optivus point s to IBA’s statement to Florida t hat it would fi nance $50 million of the technol ogy component of the proposed system (th e “financing statement ”), IBA’s price quote t o Florida (the “low-ball offer”), and IBA’s representations to Flor ida r egarding the number of pat ients that its system could treat in a year (the “patient through-put statement”) as false or misleading statements. IBA counters that Florida denies that IBA made any of t he alleged statements and that Optivus improperly relies on “self- serving and hearsay-laden” declarations and testimony to establish that su ch statements were made. With respect to the financing statem ent, Optivus presented declarations to support its allegation that IBA promised to provide or secu re financing for Florida’s proton therapy facility even thou gh it did n o t have the ability to follow thro ugh on tha t promise; IBA presented declarations and te stimony that no such offer was made. Unfair Competitio n Cla ims Order , slip op. at 33. The distr i ct court therefore concluded that “[t]he facts presented in the inst ant case are thus contested.” Id. Howev e r, the court

05-1518, -1534, -1575 12determined that ther e was no evidence that such a statement, even if made, was material to Florida’s choice of IBA over Optivus. The district court reached that conclus i on “given that Hitachi was ranked second and Optivus third in [Florida’s] order of preference for vendors,” which would pres umably result in a contract with Hitachi had IBA not been selected. Id. In reviewing the record, we conclude th at an issue of fact exists as to the materiality of the financing statement. Although a “Technology Workgroup” developed a rating system that ranked Hitac hi sec ond and Optivus last, t here is no indication that Florida adopted this ranking wit hout cons ideration of other factors. Indeed, evidenc e was introduced suggesting that Hitachi was no longer in consideration in June 2000 du e to price and communication is sues. Op tivus introduced evi dence s u ggesting that Dr. Tischer, a representative for Florida, made statements that indic a ted that the financing statement was a “signi ficant” or “major” factor in choosing a vendor for the proton bea m therapy facility. Th ese statements create a questi on of fact regarding the materiality of the alleged fi nancing statement. Although Dr . Tischer may deny that suc h statements were made, resolution of what was said is a credibility determination that i s resolved by the trier of fact. Because t he district court correctly i dentified that the fa cts surrounding the financing statement are cont ested, and because Optivus has presented evidence that creates a question of fact as to the materiality of that stat ement, we conclud e that the court erred in granting summary judgmen t to IBA on the issue of the financing statement. We hav e considered Optivus’s arguments regarding t h e low-ball offer and the patient throughput st atement and find them unpers uasive. Ac cordingly, we reverse

05-1518, -1534, -1575 13the district court’s summary judgment ruling on the Lanham Act claim only with res p ect to the financing statement. D. The Intentiona l Interference Claim To establis h intention a l interfer ence, Optivus must demonstrate: 1. the exis tence of an advantageous bus iness relationship under which that party has legal rights; 2. an intentional and unjustified interf erence with that relationship by the defendant; and 3. damage to the plaintiff as a result of the interference with the busines s rel a ti onshi p. Ahern v. Boeing Co. , 701 F.2d 142, 143-44 (11th Cir. 1983) (disc u ssing Florida law). The district court concluded that Optivus fa iled to show the existence of a business relationship with Florida after the letter of intent expir e d on March 15, 2000. Unfair Competitio n Claims Order , slip op. at 35. Optivus argues that t he district court erred in granting summary judgment to IBA on the intentional int e rference claim because issues of fact exist as to whether a business relations hip between Optivus and Florid a existed at the time of IBA’s c onduct and as to whether IBA’s conduc t was legitimate competition. IBA counters that after Optivus’s letter of intent expired on March 15, 2000, Optivus had no business relationship with Florida, and thus no legal right s, that would preclude IBA’s legitimate competition

. The district court’s conclus i on was not in error. A business relationsh i p is generally “evidenc ed by an actual and identifiable understanding or agree ment whic h in all probability would have been completed if the defendant had not interfered.” E t han Allen, Inc. v. Georgetown Manor , 647 So. 2d 812, 815 (Fla. 1994). Optivus’s arguments demonstrating a business relationship rely entirely on events and in ter a ctions that

05-1518, -1534, -1575 14occurred before March 15, 2000. To the ext ent these exchanges di d create a busines s relationship, that relationship c l early ended wit h the expiration of t he letter of intent. Optivus points to no evidence of an actual a nd identifiable understanding or agreement between it and Florida after the le tter of intent expired. Mor eover, Optivus points to n o conduct by IBA before the letter of intent expi red that could constitu te an intent ional and unjustified interference. Accordingly, the dis t rict court did not err in awarding summary judgment to IBA on this claim. II. The Patent Claims and Defens es A. The ’287 Patent Loma Linda argues that the di strict court erred in holdi ng that no issue of fact exists on the obvious ness of the ’287 pat ent over a neutron therapy facility at the University of Washin gton and a Conce p tual Desig n Report reference (the “CDR”). Specifically , Loma Linda argues that modifying the Universi ty of Washington facility as described by the district cour t would result in a “death ray” and t hus teaches away from an invention designed to treat patients; that there is no evidenc e supporting the court’s conclus i on that a motivation to combine references exists; and that no evidence supports that the CDR was public ly disseminated so as to qualify as prior art. Loma Linda also argues that the dist rict court erred in applying the law by deter mining the obvious nes s of limitations, rat her than the invention as a whole; by plac ing the burden of proving non-obviousness on Loma Linda; and by disregarding secondar y considerations of non-obvious nes s. IBA counters that the ’287 pat ent is obv ious over the Un iversity of Washington facility in v i ew of the CDR, that the CDR provides a n unquestionable motivation to

05-1518, -1534, -1575 15combine th e two references, and that Lom a Linda a n d Optivus admitted that the CDR was a publication and thus qua lifies as prior art. Loma Linda r eplies that it did not concede, but rather disputed, that the CDR qualified as prior art. As an initial matter, w e not e that Loma Linda does not argue in it s opening brief that the prior art combination utilized by the district c our t—the CDR and the University of Washington facility—fails to read on ev ery limit ation of the ’287 pa tent . Although Loma Linda argues in its reply br ief that IBA has not shown that the combination meets the “gantry” or “controllable means” limitati ons, we consider t h is argum ent waiv ed because it was not raised in Loma Linda’s opening brief. Becton Dickinson & Co. v. C.R. Bard, Inc. , 922 F.2d 792, 800 (Fed. Cir. 1990) (“[A ]n issue not raised by an appellant in its opening brief .

. . is waiv ed.”). We therefore focus on the is sues raised by Loma L i nda in its opening br ief: (1) whether the University of Washin gton facilit y teaches away from modification; (2) whether the CDR q u alifies as prior art; (3) whether evidenc e supports a motivation to combine; and (4) the propriety of the court’s application of the law. First, Loma Linda’s argument that the Univ ersity of Washington f a cility teaches away from modification is unpe rsuasive. T he Univ ersity of Washington fa cility uses neutrons, rather than protons, to treat cancer. The facility directs a proton beam at a beryllium plate to cause nuclear reactions that produce neutrons, which then travel towards the patient. Loma Linda makes m u ch of the f a ct that the proton beam used in the Univ ersity of Was h ington fac ility is of s u ch high in tensity that if it were modified b y removing the beryllium plate, it would kill pa tients rather than cure them. “A reference may be said to teach away whe n a person of ordinary skill, upon r eadin g the reference,

05-1518, -1534, -1575 16would be discouraged from following the path set out in the reference, or would be led in a direction divergent from the path that was taken by the applicant.” Kahn , 441 F.3d at 990 (quoting In re G u rley , 27 F

. 3d 551, 553 (Fed. Cir. 1994 )). As the district court noted, “the common denominator among the indiv i duals listed [by the parties as demonstrating ordin a ry skill] is a working familiarity with particle beam technolo gy, particularly as it applies to cancer treatment.” Patent Cla ims Order , slip op. at 10. Clearly, on e of ordina ry skill in t he art woul d not simply remove the berylliu m plate an d direct the high intensity pr oton beam at a patient without further calculation or adjustment. Nothing about th e Un iversity of Washington fa cility ca n be said to discourage a person having ordinary skill in t he art from modifying it to en able proton therapy or to lead the skille d artisan in a p a th diverge n t from the path taken by Loma Linda. Second, we decline Loma Linda’s invitation to question the stat us of the CDR as prior art. Loma Linda is corre ct that neither the “Transmittal of Publication” submitted during prosecution of the ’ 287 patent nor Optivus’s Statem ent of Genuine Issues of Material Fact (Optivus’s “genuine issues st atement”) characterize the CDR in such a way as to qualify as an admissi on that the CDR was prior art. However, in IBA’s motion for summary judgment of invalidity, it subm itted argument and eviden ce identifying the CDR as a prior art reference and utilizing that prior art to demonstrate obviousness. Loma Lind a’s respon se to that motion did not dispute that the CDR was prior art; in fact, its response made no reference to the CDR at all. Optivus’s resp onse to IBA’s motio n like wise d i d not dispu t e that the CDR was prior art; indeed, its response referred to and discussed the teachings of the CDR in t he context of discussing “prior art” and

05-1518, -1534, -1575 17“references.” Optivus’s genui ne issues statement—the only record citation that Loma Linda points to as evidence of it s position on the CDR’s prio r art s t atus—notes only that the CDR was not characterized as prior art during prosecution of the patent; it does not dispute that the CDR was prior art. H e re, IBA supported its motion for summary judgment of invalidity with evidence sufficien t, if unopposed, to establish that the CDR was prior art; the burden of production then shifted to Loma Linda to identify genuine issues that preclude s u mmary judgment. See Fe d. R. Civ. P. 56 (e ); 10A C. Wright, A. Miller, & M. Kane, Federal Practice and Procedur e § 2727 ( 3d ed. 19 98) (“[I]f th e movant makes out a prima facie case that w ould entitle him to a judgment as a matter of law if unco n troverted at tr ial, summary judgment will be granted unless the opposing party offers some competent evidence that could be presented at trial showing that there is a genuine issue as to a material fa ct.”). Because Loma Linda’s submissions t o the district court failed to id entify a genuine issue regar ding the publication st atus of the CDR, we d e clin e to c onsider the me rits of that argume n t on a ppe al. Singlet on v. Wulff , 428 U.S. 106, 120 (19 76) (“It is the general r u le, of cour se, that a federal appellate c ourt does not consider an issue not passed upon below.”). Third, Loma Linda’s argument that there is an i ssue of fact regarding the motivation to combine is unpersuasive. T he CDR provides an overview of pr oton beam cancer therapy from i t s first proposal in 1946 to the state of the ar t at the time of the study and notes that recent technological developments in diagnostic and alignment devices had reawakened interes t in proton beam therapy. A stated design goal of the proposed facility in the CDR wa s to create a facility with more treatment rooms, more advanced beam control, and the availability of different energies to treat different tissue

05-1518, -1534, -1575 18depths. The study discusses proton, neutron, and other particle therapy methods and specifica lly notes that a neutr on therapy facility was in operati on a t the time of the study. Howev e r, the CDR argues that protons have im portant advantages over neutron and other particle therapy methods. In considering motivat i on in an obviousness ana lysis, we ask “whether a per son of ordinary skill in the art, possessed with the unde rstandings and knowledge reflec ted in t he prior art, and motivated by the general problem faci ng the invent or, would have been led to make t he combination recited in the claims.” Kahn , 441 F.3d at 988. Here, there is no question that the CDR establishes that a person hav ing a working familiar i ty with particle b eam technology as it relate s to cancer treatment, motivated by the need for more effective and efficient proton therapy facilities, would hav e been le d to combine the University of Washington’s neutron therapy facility with th e prot on beam therapy design outline d in the CDR. We see no error in the district court’s conclusion that a motivation to combine the two references exists as a matter of law. Finally, the district court’s applic ation of the law does not warrant reversal. The court analy z ed the level of skill in the ar t, the scope and content of the prior art, the differences between t he claimed invention and the prior art, and the alleged secondary considerations of non-obviousness. See Patent Claims Order , slip op. at 9-32. The court determined that a motivation to comb ine the prior art references exist e d, id. , slip op. at 17, and that the references did not teach away from combination or modification, id. , slip op. at 30-32, thereby guarding against a hindsight reconstruction of the invention. See Kahn , 441 F.3d at 987 (holdi ng that the motivation-suggestion-teaching test, much like the analogous- a rt test, is used to defend against hinds ight). As

05-1518, -1534, -1575 19discussed above, the combinatio n of prior art references was proper, and Loma Linda’s opening brief does not contest the district court’s conclusion that the combination reads on every limitation in the ’287 pat ent. Loma Linda points to the cour t’s statement that “[t]here is no indication that the desire or ability to provide proton ther apy, as opposed to neutron therapy, was nonobvious,” Patent Claim s Order , slip op. at 17, as a misalloca tion of the burden of proof. That statement reflected t he court’s determination that the prior art indicated the motivation and ab ility to develo p proton the r apy facilities; it in no way demo n strates a misalloc a tion of the burden of pr oof. The whole of the dist rict c ourt’s opinion in dicates that, consistent with F ederal Rule of Civ il Procedure 56(e ), it placed the bur den on IBA to support its motion with credible evidenc e and, upon a prima facie showing, shifted the burden of production to Loma Linda to produce evidenc e demonstrating a genuine issue for trial. The district c ourt also did not disregard se condary considerations of obvious nes s. Patent Cla ims Order , slip op. at 24-30. We find Loma Linda’s arguments regarding skepticism in the art, commercial succ ess, and long-felt need to be unpersuasive. Because the district court co rrectly allocated the burden of proof and made the relevant inquiries into obvious ness law, and bec ause “[w]e sit to review judgments, not opinions,” Stratoflex, Inc. v. Aeroquip Corp. , 713 F.2d 1530, 1540 (Fed. Cir. 1983), we see nothing in t he district court’s application of the la w that warrants a reversal. Accordingly, we affirm the district c ourt’s summary judgment holding the ’287 patent invalid. Having affi rmed the judgment of invalidity, we need not address the

05-1518, -1534, -1575 20judgment of non-infringement. See id. at 1541 (“The claims hav ing been fo und invalid, the issue [of infringement] has been rendered moot.”). B. The ’581 Patent Loma Linda argues that the dist rict court erred in holdin g that no issue of fact exists on t he obv ious ness of the ’581 pat ent over the Fermilab National Accelerator Laboratory Neutron F a cility (the “Fermilab” fa cility). Specifica lly , Loma Lin da argues that there i s no evidence indicating that t he Fermilab facility employed a safety system with the “verifying” step or t he “beam path configuration sign al” limitation as required by claims of the ’581 patent. 3 IBA responds that the Fermilab facility possesses all of the claimed steps and limitations. IBA also r e sponds that Loma Linda did not argue in the district court that the Fermilab fa cility lack e d the “beam path confi guration s i gna l” limita t ion and sh ould not be permitted to do so on appeal. The “verifying” step in claim 1 of the ’581 patent requires “verifying the authenticity of one of t he beam request signals.” ’581 pat ent, col. 9, ll. 9- 10. Loma Linda does not disput e the court’s construction of this step, whic h was interpreted to mean “to confirm or establis h t he genuine or trustw orthy nature of one of the beam request signals from one of the treatment rooms.” Claim Construction Order , slip op. a t

3 Loma Linda als o argues that t he district court improperly “mined the record” and held the ’581 patent obvious in vi ew of the Harvard Cyclotron Laboratory, the details of which Loma Li nda argues were incomplete and uncorroborated. The district court, however, independently held t he ’581 pat ent invalid based on t h e Fermila b facility alo ne. Paten t Claims O r der , slip op. at 43. Further, Loma Linda presents a conditional appeal argui ng that we should address the construction of the “beam path configuration signal” limitation if we dec ide to remand. Be cause we affirm the district court’s judgment of invalidity b a sed on the Fermilab facility, we do not address these arguments.
05-1518, -1534, -1575 2131. IBA presented evidence de monstrating that the Fermil ab facility authenticated a beam request signal before sending the si gnal. Loma Linda’s arguments and exper t testimony assert that the “verif ying” step requires authentication after the signal has been sent, focusing on the proposit ion that a signal cannot be confirmed as genuine until it has been made. Such an analysis, howev er, ignores that the court i n terpreted the “verifyi ng” step as to confirm or establish authentication. Authenticatin g a signa l before it is sent establishes t he genuine nat ure of the s i gnal. As t he district court noted in respons e to the same argument below: “T he word ‘after’ appears nowher e in claim 1. There are no such lim itations on the terminology in the ’581 pa tent. The patent at issue is written with expansive and highly inc l usiv e language.” Patent Cla ims Order , slip op. at 43 n.31. Because Loma Linda’s evidence fa iled to address the ent irety of the court’s construction, it did not properly r ebut IBA’ s evidenc e d e monstrating that the Fermilab facility pos sessed the “verifying” step. We ther efore conclud e that the district court did not err in holding that the Fe rmilab facility employed a safe ty system with the “verifying” step. This c ourt does n o t n eed to rea c h the me rits of whe t her the F e rmilab fac ilit y employed a safety sy stem wit h the “beam path conf iguration signal” limitation becaus e Loma Linda waived t h is argument by failing to raise it below. Lo ma Linda argues that the signals used in the Fermilab facility fail to include information about the physical properties of the proton beam, as required by the court’s construction. IB A submitted evidenc e to demonstrate that the Fermilab facility possessed the “beam path configuration signal” limitation. Loma Linda fails to identify—and we fail t o find—any support in t he record to indicate that it cont ested this evidence before the dis t rict court.

05-1518, -1534, -1575 22We therefore decline Loma Lind a’s inv i tation to consider its arguments based on the “beam path configuration signal” limitation f o r the first time on appeal. Sing leton , 428 U.S. at 120. Accordingly, we affirm the di strict court’s summary judgment holding the ’581 patent invalid. C. The Motion to Amend On cross-appeal, IBA argues that the district cour t abused it s discretion in denying IBA’s motion to amend the pl eadings to add a defense of patent unenforceability due to inequitable conduct after the motion cut-off date had expired. Loma Linda counters that the court’s denial was proper becaus e IBA was not diligent and had filed the moti on for dilatory purposes. After a scheduling order has been enter ed, a party “must s how good cause for not having amended [its complaint] before the time specified in the scheduling order expired.” Coleman v

. Quaker Oats Co. , 232 F.3d 1271, 1294 (9th Cir. 2000). “This standard ‘primarily considers the diligence of the party seeking t he amendment.’” Id. (quoting Johnson v. Mammoth Recreations, Inc. , 975 F.2d 604 (9th Cir.1992)). The district court determined that IBA’s motion was not s upported by any ev idence, was inexcusably delay ed, would res u lt in prej udice to Loma Linda and Optivus, and was likely filed in bad faith. Motion to Amend Order , slip op . at 5-7. W e are not persuaded that these determinations were in error. Acco rdingly, we conclude th at the district court did not abuse its discretion in de nying IBA’s motion to amend. CONCLUS ION Because t he district court misapplied t he law in requiring Optivus to exhaust administrative remedies before pursuing the California unfair competition la w claim, we

05-1518, -1534, -1575 23reverse the court’s dis m issal of that claim and remand for further proceedings

. Becaus e a question of fact exists as to whether the fi nancing statement was material, the district court erred in granting summary judgment to IBA on the Lanham Act claim. We therefore reverse summary judgment on the Lanham Act claim only wi th respect to the financing statement and remand for further proceedings . We otherwise affirm. AFFIRMED-IN-PART, REV E R S E D -IN-PART , AND RE MANDE D. COSTS No costs.

05-1518, -1534, -1575 24