Intent to infringe

December 27, 2016
Patterson Thuente IP

Verdict goes against medical device maker

When the U.S. Supreme Court agreed that an appellate court’s infringement ruling should be reconsidered, it probably seemed like good news to the medical device maker that had been found liable in the initial ruling. Alas, the new ruling that followed reconsideration also went against the company. The Federal Circuit Court of Appeals found the position in the company’s defense “objectively unreasonable.”

Device maker charges infringement

NuVasive, Inc., holds a patent on a method for detecting the presence of and measuring the distance to a nerve during surgery. Its device uses a series of electrical pulses that gradually increase in strength until a pulse reaches sufficient strength to elicit a nerve response. The stimulus signal stops immediately after the response is detected (the patent’s “stopping limitation”).

When Warsaw Orthopedic, Inc., and Medtronic Sofamor Danek USA (collectively, MSD) sued NuVasive for patent infringement, NuVasive counterclaimed, accusing MSD of infringing its patent. In March 2015, the appeals court affirmed a trial court’s verdict that MSD infringed the NuVasive patent, holding that users of MSD’s device (doctors) directly infringed the patent and that MSD induced this infringement.nervecell

Commil prompts reconsideration

Three months later, the Supreme Court decided Commil USA, LLC v. Cisco Systems, Inc. In that case, it held that proof of induced infringement requires not only knowledge of the patent but also proof that the defendant knew the induced acts were infringing. According to the Federal Circuit, the ruling also necessarily reaffirmed that willful blindness can satisfy the knowledge requirement, even in the absence of actual knowledge.

The Commil decision prompted MSD to ask the Supreme Court to vacate the appellate court’s ruling. MSD contended that NuVasive had failed to prove that MSD had the requisite knowledge to induce infringement. The Supreme Court sent the case back to the appellate court for reconsideration.

Court signals its skepticism

On reconsideration, the appellate court focused on whether the jury had enough evidence to infer that MSD knew — or was willfully blind to the fact — that doctors’ use of its device infringed NuVasive’s patent. MSD asserted that the patent’s stopping limitation required a complete termination of any and all electrical pulses. Therefore, MSD argued, its device didn’t infringe the patent because the device doesn’t terminate all electrical pulses after detecting a nerve. Instead, it continues to emit pulses at lower energy levels.

The appellate court found this position “objectively unreasonable.” It concluded that the stopping limitation requires stopping a particular kind of signal — “said stimulus signal,” or the signal that elicited a response from the nerve being probed. This doesn’t require stopping any and all electrical signals emitted by the device. According to the court, neither the language in the patent nor its prosecution history supported MSD’s position that the patent required complete termination of all electrical stimulus pulses.

And the original jury heard undisputed evidence that, immediately after nerve stimulation, MSD’s device reduced the strength of the electrical stimulus pulses it emitted to a level that wasn’t capable of stimulating the nerve that had provided the response. In other words, the court said, the “said stimulus signal” emitted by the device stopped immediately after the nerve response was detected.

MSD’s knowledge of the patent was also undisputed. Based on this evidence, the jury could reasonably have concluded that MSD had the requisite knowledge of infringement.

Stimulating conclusion

The appellate court made an important clarification during its reconsideration. It stated that its opinion in this case didn’t mean that any time a defendant’s products are found to directly infringe, the plaintiff has sufficiently established an intent to induce infringement. Rather, the court explained, the plaintiff can show that a defendant’s asserted belief in noninfringement was unreasonable.

Warsaw Orthopedic, Inc. v. NuVasive, Inc., No. 2013-1576, -1577, June 3, 2016 (Fed. Cir.), Commil USA, LLC v. Cisco Sys., Inc., No. 13-896, 2015 (U.S.)

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