Pre-KSR obviousness instruction does not result in plain error post-KSR
January 10, 2008

In a decision this week, the Federal Circuit affirmed findings of infringement of two patents by two defendants. The court also reversed an invalidity ruling of one of one claim that had been the subject of reexamination, but remanded the case to the district court for a determination of the obviousness of one claim based on a revised claim construction and for a determination of damages.While the case went to the jury pre-KSR, the court held that the district court's jury instructions on obviousness, which focused on the teaching-suggestion-motivation test, including that a motivation to combine references may be found in the nature of the problem to be solved, did not warrant reversal. This indicates that the effect of KSR on the obviousness analysis may not be as dramatic as some have predicted, at least outside the USPTO.In addition, the court held that the requirements in 35 U.S.C. § 305 regarding new claims in reexamination proceedings need not be specifically noted by the applicant when adding new claims. Instead, the court confirmed that the limit on new and amended claims in reexamination is that they may not enlarge the scope of the original claims.More detail of Cordis Corp. v. Medtronic AVE, Inc. after the jump.

These consolidated appeals are between competing manufacturers of coronary stents, and relate to two patents, 4,739,762 and 5,195,984. The '762 patent discloses a coronary stent mountable on an angioplasty balloon and delivered to a target location intraluminally via catheter. At issue is claim 23, which covers an expandable intraluminal vascular stent comprising a "tubular member having . . . a wall surface . . . the wall surface having a substantially uniform thickness and a plurality of slots formed therein." The claim also requires the wall surface to be "smooth." The '984 patent discloses a flexible stent manufactured by joining tubular members by a connector providing "necessary flexibility to negotiate the bends and curves in tortious body passageways, such as the vascular system." Cordis is the owner of the patents, and brought suit against Medtronic AVE and Boston Scientific for infringement.

Cordis first alleged that three of Medtronic's stents infringed the patents. A jury found in favor of Cordis, deciding that Medtronic's stents did infringe the patents under the doctrine of equivalents. However, the district court granted Medtronic's motion for judgment as a matter of law of non-infringement under the doctrines of equivalents and granted a new trial on the issue of literal infringement. In a previous appeal, the Federal Circuit reversed the district court's construction of the claim "plurality of slots formed therein" and "substantially uniform thickness," holding that the slots did not require a particular formation process and that the district court erred in narrowly construing the "uniform thickness" limitation. The Federal Circuit construed the term "substantially uniform thickness" to mean that the "walls must be of largely or approximately uniform thickness" as based on the prosecution history showing that Cordis had previously disclaimed stents having varying thickness of its walls. On remand, the jury found infringement based on the revised construction, and Medtronic appealed again. Medtronic argued that its stents fail to meet the "substantially uniform thickness" limitation because its walls diminish in thickness in the tapered end of the crown portion of the device. A diagram of the Medtronic stent is shown below, with the "crown" portion circled:Medtronic stentMedtronic argued that based on the Federal Circuit's construction in the previous appeal, its stents could not infringe because the thickness of the stent decreased to zero at the tip of the "crowns" on the stent. The Federal Circuit disagreed, finding this method of measuring the thickness of the stent inconsistent with its earlier construction. The court held that the jury's verdict of infringement of this limitation was supported by substantial evidence, and therefore affirmed this finding.

Medtronic also argued that it was entitled to judgment as a matter of law of noninfringement of the '984 patent because its stents do not meet the "flexibly connect" limitation. Medtronic argued that its stents' connectors were not flexible, and therefore did not meet this limitation. The Federal Circuit disagreed, noting that the claim language only required that the stent itself be flexible, not that the connectors be flexible in and of themselves. Medtronic also took issue with one of Cordis's experts who testified at trial as to the simulated bending in Medtronic's stents to meet the "flexibly connect" limitation, arguing that the testimony should have been excluded as unreliable. The Federal Circuit disagreed, noting the expert had a doctoral degree in mechanical engineering and extensive experience, and was therefore adequately qualified under Rule 702. Moreover, Medtronic had adequate opportunity to present their concerns about the data and the expert to jury. Medtronic further contended it was entitled to a new trial on several grounds, but the Federal Circuit rejected these challenges as well.

A final challenge that Medtronic presented related to the district court's instruction to the jury on obviousness, alleging that it conflicted with KSR, which was decided between the time the instruction was given and the time of the appeal. The instruction was as follows, in relevant part:

A suggestion to combine references may also flow from the nature of the problem or from the ordinary knowledge of those skilled in the art that certain references are of special importance. If the prior art references as a whole do not teach, suggest or motivate that combination, then they may not be combined. The mere fact that the prior art can be modified does not make the modification obvious unless the prior art suggests the desirability of the modification.
The Federal Circuit stated that Medtronic failed to show that the jury instruction in its entirety conflicts with the Supreme Court's language in KSR indicating the teaching-suggestion-motivation test was not to be rigidly applied. As a result, the instruction did not result in plain error. Having disagreed with all of Medtronic's bases for appeal, the finding of infringement against Medtronic was affirmed.

Turning to Boston Scientific's appeal, Cordis asserted that one of its stents infringed claim 23 of the '762 patent. An original jury verdict found Boston Scientific liable for infringement under the doctrine of equivalents, however the district court granted Boston Scientific's motion for a new trial as a result of its failure to instruct the jury regarding prosecution history estoppel for the "substantially uniform thickness" limitation. At the new trial, the district court used the claim interpretation from Medtronic's original appeal and ultimately a jury again found infringement. Boston Scientific's current appeal involved the construction of the term "slots," the jury verdict relating to infringement of the "wall surface" and "smooth surface" limitations, and obviousness.

Boston Scientific first argued that the claim construction of "slots" results in an inoperable embodiment as well as is contrary to the language of the specification. The district court's construction permitted both "complete" slots and "half" slots (slots not completely bounded). The Federal Circuit affirmed the district court's claim construction, as the patent used the terms "half-slot" and "complete slot," implying that the use of the term "slot" in the claim encompassed both.

Boston Scientific also argued the jury verdict from the first trial should be overturned because no reasonable jury could have found that their stents literally infringe the "wall surface" and "smooth surface" limitations, because prosecution history estoppel barring the doctrine of equivalents for those limitations. The Federal Circuit determined that the jury properly returned a verdict of infringement. For the "wall surface" limitation, the court stated there was substantial evidence to support the finding of literal infringement, and thus the doctrine of equivalents was not necessary. However, because the jury returned a general verdict of infringement under the doctrine of equivalents, the court still examined whether prosecution history estoppel applied. The form of estoppel argued for this limitation was argument-based estoppel; Boston Scientific argued that in distinguishing the prior art, Cordis disclaimed certain equivalents to the "wall surface" limitation. The court disagreed, holding the statements made were not the "clear and unmistakable surrenders of subject matter" necessary for argument-based estoppel to apply. As a result, the jury's finding regarding this claim element was affirmed. For the "smooth surface" limitation, the court affirmed the verdict on a different ground than the district court. The Federal Circuit noted the district court gave an unnecessarily restrictive construction to the limitation, stating that it should be defined functionally, namely that the surface must be smooth enough to permit intraluminal delivery. As it was undisputed that Boston Scientific's stent was sufficiently smooth, it was not necessary to address the doctrine of equivalents for this element. However, Boston Scientific successfully argued that it was entitled to a new trial on the issue of obviousness based on the new, broader construction applied to this term, and the court remanded this issue to the district court.

Finally, Cordis challenged the district court's invalidation of claim 44 of the '762 patent under 35 U.S.C. § 305. During reexamination, a patent owner, pursuant to § 305, may propose amendments and new claims to distinguish the invention from the prior art cited. However, § 305 presents limitations that new amendments or claims cannot enlarge the scope of a patent claim. Cordis added multiple claims during the reexamination procedure which ultimately lead to a district court's determination of invalidity under § 305 because one of the claims was not added to either "(1) distinguish the invention as claimed from the prior art or (2) in response to a decision adverse to the patentability of a claim of patent" as required by § 305. The district court determined that the claim was added solely to cover infringement for a competitor's stent which is not a permissible ground under § 305. The Federal Circuit reversed, holding the district court improperly interpreted § 305. This case shows how the Federal Circuit is likely to handle appeals in cases where the issue of obviousness was decided before KSR but the appeal happened after KSR. Alleged infringers will apparently have to satisfy the "plain error" standard of review, unless they lodged a challenge to the obviousness jury instruction (without knowing the outcome of KSR at the time, of course). This more deferential standard should presumably permit the Federal Circuit to affirm more pre-KSR nonobviousness decisions post-KSR.To read the full decision in Cordis Corp. v. Medtronic AVE, Inc., click here.
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