Source: https://patentlyo.com/patent/patent-cases-2011/page/2
Timestamp: 2019-04-26 06:28:33+00:00

Document:
Cordis v. BSC turns on an interpretation of a construction of the claim term "undulating." In this case, Cordis obtained a jury verdict of infringement of Patent No. 5,879,370 against Boston Scientific Corporation. Prior to trial, the district court construed the term "undulating" to mean "rising and falling in waves, thus having at least a crest and a trough." Slip Op. at 11. After Cordis obtained its favorable verdict, BSC renewed its motion for judgment as a matter of law on noninfringement, arguing that "Cordis inappropriately altered the parties' and the court's understanding of the term 'undulating'," and that under the "intended" construction the evidence presented at trial could not support a conclusion that this claim element was met by the accused product. Slip Op. at 11. The district court granted BSC's motion and Cordis appealed.
Construing Constructions: On appeal, the CAFC confirmed the propriety of BSC's argument. "The question here is whether BSC did, in fact, seek to alter the district court’s claim construction," a construction Cordis did not challenge. Slip Op. at 12. It did not. "No rule of law restricted BSC from seeking to clarify or defend the original scope of its claim construction." Slip Op. at 12. However, "because BSC did not object to the court’s jury instruction regarding the construction of the term “undulating,” “[t]he verdict must be tested by the charge actually given [under] the ordinary meaning of the language of the jury instruction,” Hewlett-Packard, 340 F.3d at 1321." Id.
In deciphering the "ordinary meaning" of the district court's construction, the CAFC first turned to a general purpose dictionary definition of 'waves' to conclude that 'crest' and 'trough,' "as used in the district court's claim construction, implicate changes of direction, with the curve extending beyond the point of inflection." Slip Op. at 13. Although Cordis cited expert testimony and dictionary entries of its own, the CAFC was not persuaded. The CAFC also looked to the prosecution history, which further suggested a construction of "undulating" that meant more than just a single curve.
Applying this interpretation of the district court's claim construction, the CAFC concluded that Cordis had indeed failed to offer substantial evidence of infringement.
Inequitable conduct: This case was involved in a prior appeal, Cordis Corp. v. Boston Scientific Corp., 188 F. App’x. 984, 985 (Fed. Cir. 2006), in which the CAFC addressed a district court finding of inequitable conduct. In that appeal, the CAFC affirmed the materiality of the conduct at issue but remanded to the district court for further findings of fact relating to intent. On remand, the district court reached an alternate conclusion, deciding that, on reflection, the evidence of record failed to support a finding of deceptive intent under a clear and convincing standard. On appeal, the CAFC affirmed the finding of no inequitable conduct, noting in particular the deference given to district courts on issues of credibility.
Interpretations of constructions raise a difficult issue for the Federal Circuit, and have implications for litigation predictability. While the panel in this case did not directly identify the standard of review it applied to the district court's interpretation of the construction, the analytic structure of the opinion follows the same approach that the CAFC has traditionally employed when construing claims generally: look at the evidence and arrive at its own conclusion, i.e. de novo. In this instance, the methodology used by the panel seems to harken back to the Texas Digital line of claim construction: start by determining the ordinary meaning of a word using tools such as dictionaries, then look to the intrinsic evidence to see if it compels a different result. Perhaps this approach may be more defensible in light of the subject being interpreted, but it seems at odds with the principles announced in Phillips.
The interpretation issue in this case also raises a possible red flag against the concept of routine interlocutory review of claim constructions, a proposal frequently offered as reducing litigation costs and enhancing the predictability of litigation. If a claim construction itself is subject to a subsequent interpretation, are efficiencies truly added by having the CAFC offer an early construction? There is a real possibility that, if such a proposal were implemented, the result would be a rise in appeals involving not just claim constructions, but interpretations of claim constructions.
When a patentee is faced with an judgment of invalidity or inequitable conduct, it is a relatively common tactic to settle with the accused infringer who, as a condition of the settlement agreement, then joins the patentee in a joint motion for vacatur of the adverse decision. Although vacatur requires exceptional circumstances, it is sometimes granted by the district court. See e.g., Gracenote, Inc. v. MusicMatch, Inc.; Block Financial v. LendingTree; New Medium v. Barco.
The situation becomes more complex, however, when settlement occurs while the case is on appeal. Willow Wood involves an appeal of an Eastern District of Texas judgment invalidating the asserted claims of Patent No. 7,291,182. While the appeal was pending, the parties settled and filed a motion for remand to the district court for consideration of a motion for vacatur. In July 2010, the CAFC issued an order pointing out the high standard for vacatur and ordered the parties to explain what extraordinary circumstances would be presented to the district court that would justify vacatur. Ohio Willow Wood Co. v. Thermo-Ply, Inc., (Fed. Cir. Order July 29, 2010) (nonprecedential).
After considering the parties' response, along with an intervention request by a third party also being sued for infringement of the patent, the panel granted the request for "the limited purpose of the district court's consideration of the parties' motion for vacatur." Ohio Willow Wood Co. v. Thermo-Play, Inc. (Fed. Cir. Order 2011) (Willow Wood II). The CAFC retained jurisdiction, however, "so that any of the parties may seek appellate review by notifying the Clerk of the Court within thirty days of entry of the district court’s decision on remand." Id. at 3.
In this case, for example, the patentee has already sued another party on the patent in question. If the decision that invalidated the patent at issue is not vacated, then the patentee will be collaterally estopped from asserting this patent in this and other suits, thereby saving courts and litigants the time and money it takes to proceed with patent litigation. Patent litigations are among the longest, most time-consuming types of civil actions. As of 2009, 384 patent cases had been pending in the district courts for three years or more. 2009 Admin. Off. U.S. Cts. Ann. Rep., at Table S-11. Moreover, the costs of patent litigation are enormous with an average patent case costing upwards of $3 million for each side. See American Intellectual Property Law Association, Report of the Economic Survey 2009 I-129 (2009). If the district court vacates its invalidity judgment then other defendants and other district courts will be forced to proceed with infringement suits, as there would likely be no collateral estoppel. Even if there were no other suits pending, these concerns should still weigh heavily against vacatur, as the only reason the patentee would want an invalidity judgment vacated is to potentially enforce the patent against others.
Judge Moore's decision to weigh in on the merits of the vacatur issue was criticized by Judge Newman, however, who wrote separately "to point out that the views of our colleague in separate concurrence are not the court’s remand order." Willow Wood II, additional views at 2. Although favoring the remand on the basis that the district court is in the better position to rule on the issue of vacatur, Judge Newman declined to endorse Judge Moore's proffer of judicial advice, commenting that "[o]ur remand should be unencumbered by even the appearance of prejudgment or of the weight to be given to various considerations. Indeed, the issues on which our colleague in concurrence offers judicial advice are more complex than is here recognized." Id.

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