Abbott Point of Care Inc. v. Epocal, Inc.
666 F.3d 1299
Fed. Cir.2012Background
- Abbott sued Epocal for infringement of the '328 and '772 patents in the Northern District of Alabama; the district court dismissed for lack of standing and Abbott appealed.
- Lauks, Epocal’s founder, previously worked for Abbott’s predecessors (Integrated Ionics and i-STAT) under multiple agreements including the 1984 Assignment Covenant in the untitled 1984 agreement.
- The 1992 Employment Agreement incorporated the 1984 covenants; Lauks resigned from i-STAT in 1999 and began a consulting period under the 1999 Consulting Agreement.
- The 1999 Consulting Agreement acknowledged Lauks’ consulting work and preserved confidentiality/non-solicitation/non-competition covenants but did not explicitly retain the 1984 Agreement’s assignment obligation.
- In 2003 Lauks assigned the patents to Epocal; Abbott acquired i-STAT in 2004; Abbott asserted ownership based on the 1984/1992/1999 agreements, which the court found did not convey the invention assignments during the consulting period.
- The appellate court affirmed the district court’s dismissal, holding Abbott lacked standing to sue for infringement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does Abbott have standing to sue for infringement? | Abbott asserts ownership under the 1984 Agreement carried forward by the 1999 Consulting Agreement. | Epocal argues the 1999 Agreement did not continue the assignment covenant; there is no ongoing obligation to assign inventions. | Abbott lacks standing; contracts do not convey invention rights during the consulting period. |
| Did the 1999 Consulting Agreement incorporate the 1984 and 1992 assignment covenants? | The continued references to the 1984/1992 agreements imply incorporation of the assignment obligation. | The 1999 Agreement is silent on assignment and explicitly limits covenants to confidentiality/non-solicitation/non-competition. | No clear incorporation; the majority held no continued assignment obligation. |
| Is extrinsic evidence admissible to interpret the contract terms? | Extrinsic evidence should be available to interpret potential incorporation of prior covenants. | Extrinsic evidence cannot modify or contradict clear contract language when unambiguous. | Extrinsic evidence not used to alter unambiguous terms; district court did not err in denying discovery. |
| What law governs contract interpretation? | New Jersey law should govern the agreements. | Same; New Jersey law governs contract interpretation. | New Jersey law governs interpretation; contract language unambiguously conveyed the parties’ intention. |
Key Cases Cited
- Rite-Hite Corp. v. Kelley Co., 56 F.3d 1538 (Fed.Cir.1995 (en banc)) (standing to sue; requires patentee or successor to sue for infringement)
- Mentor H/S, Inc. v. Medical Device Alliance, Inc., 240 F.3d 1016 (Fed.Cir.2001) (assignment/ownership via patent title transfers)
- Spring Creek Holding Co. v. Shinnihon U.S.A. Co., 399 N.J. Super. 158, 943 A.2d 881 (N.J. Super. Ct. App. Div. 2008) (contract interpretation; no deference to trial court for interpretation)
- United Technologies Corp. v. Mazer, 556 F.3d 1260 (11th Cir. 2009) (review of district court’s denial of discovery for abuse of discretion)
- Metabolite Labs., Inc. v. Lab. Corp. of Am. Holdings, 370 F.3d 1354 (Fed.Cir. 2004) (choice of law; contract interpretation; extrinsic evidence context)