MEDISIM LTD., Plaintiff-Appellant, v. BESTMED, LLC, Defendant-Appellee.
No. 2013-1451.
United States Court of Appeals, Federal Circuit.
July 14, 2014.
1352
Dan L. Bagatell, Perkins Coie, LLP, of Phoenix, AZ, argued for defendant-appellee. With him on the brief were Matthew B. Du Mée; and David R. Pekarek Krohn, of Madison, WI.
Before PROST, Chief Judge, TARANTO and CHEN, Circuit Judges.
PROST, Chief Judge.
Plaintiff-Appellant Medisim Ltd. (“Medisim“) appeals the grant of judgment as a matter of law (“JMOL“) by the United States District Court for the District of New York that U.S. Patent No. 7,597,668 (“‘668 patent“) is anticipated by Medisim‘s own prior art FHT-1 thermometer. See Medisim Ltd. v. BestMed LLC, 959 F.Supp.2d 396, 425 (S.D.N.Y.2013). It also appeals the district court‘s grant of JMOL in BestMed, LLC‘s (“BestMed“) favor on Medisim‘s unjust enrichment claim. Id. at 426. Because BestMed failed to preserve its right to JMOL on anticipation under
I. BACKGROUND
Medisim owns the ‘668 patent, which is directed to a fast non-invasive thermometric device that displays a core body temperature. ‘668 patent col. 2 ll. 13-15. The claimed device is placed against an external skin surface, takes temperature readings from one or more temperature sensors, determines time-dependent parameters of temperature change responsive to those readings, and calculates a deep tissue temperature. Id. at col. 1 l. 57-col. 2 l. 5. Thе claimed device then calculates a core body temperature by correcting for the difference between the deep tissue temperature and the core body temperature. Id. at col. 2 ll. 6-12. Claim 1 is representative:
1. A thermometric device, comprising:
a probe, comprising:
a membrane configured to be applied to an external surface of a body of a subject; and
one or more temperature sensors located within the probe in thermal contact with the membrane; and
a processing unit configured to receive a plurality of tеmperature readings from the one or more temperature sensors, to determine time-dependent parameters of temperature change responsively to the plurality of temperature readings, to calculate, a deep tissue temperature of the body at a location under the skin that is a source of heat conducted to the one or more temperature sensors, and to calculate a core body temperature by correcting fоr a difference between the core body temperature and the deep tissue temperature.
Id. at col. 10 ll. 2-18. The other independent claim, 21, recites the same concept in method format. Id. at col. 11 ll. 25-41.
More than a year before filing the application that eventually issued as the ‘668 patent, Medisim marketed and sold the FHT-1 thermometer. Therefore, Medisim‘s own product qualifies as prior art to the ‘668 patent under
From November 2004 to May 2007, BestMed marketed and sold several of Medisim‘s thermometers in the United States under an “International Distribution Agreement” (“IDA“). While the IDA was in effect, BestMed was privy to technical information concerning many of Medisim‘s thermometers and its testing procedures, including its water bath testing protocol. This water bath testing protocol enabled Medisim‘s thermometers to be approved by the Food and Drug Administration for sale in the United States.
In 2008, the parties entered into a new “Purchase and Sale Agreement” (“PSA“), which set out the terms governing the parties’ separation. The PSA authorized the parties to offer competing products to current customers as long as delivery occurred after May 1, 2009. The parties also released all claims that had arisen or might arise out of their past performance or disputes regarding the IDA.
After the exрiration of the PSA, BestMed began selling competing thermometer products made by K-Jump Health Co. Ltd.
II. PROCEDURAL HISTORY
Medisim filed suit against BestMed in the Southern District of New York on March 17, 2010, accusing BestMed, inter alia, of directly and indirectly infringing the ‘668 patent by selling the K-Jump thermometers and of benefitting from unjust enrichment. Before the case was submitted to the jury, both parties made several motions requesting JMOL under
In addition, BestMed expressly moved for JMOL under
Following the jury verdict, BestMed moved for JMOL of anticipation and no unjust enrichment under
The district court‘s ruling vacated Medisim‘s entire damages award, and Medisim has appealed to this court. We have jurisdiction pursuant to
III. DISCUSSION
This appeal concerns Medisim‘s challenges to the district court‘s grant of JMOL on anticipation and unjust enrichment. Medisim argues that BestMed forfeited its right to JMOL under
A. Forfeiture of JMOL
In the past we have found that parties forfeited the right to move under
1. Forfeiture of JMOL on Anticipation
Medisim first argues that BestMed failed to move for JMOL on anticipation under
BestMed denies such forfeiture. In support of its argument, it points to a statement it made on the record at the close of evidence in opposition to Medisim‘s JMOL motion for no anticipation. Its cоunsel stated: “On ... anticipation, I submit that the jury can readily find that the FHT-1 product, Medisim‘s own product, is anticipatory. There‘s clear and convincing evidence, we submit, on that issue. Also [Medisim‘s witnesses‘] testimony support[s] that position. But, again, it‘s definitely something for the jury.” J.A. 4530.
While BestMed concedes that this statement was “not a model of clarity,” it argues that Medisim was on notice of BestMed‘s position. Appellant‘s Br. 59. Further, BestMed notes that when Medisim moved to strike BestMed‘s
[T]he rule of Duro-Last, Inc. v. Custom Seal, Inc., which i4i Partnership applies, is based on the proposition that it would be impermissible under the Seventh Amendment to re-examine the jury‘s verdict upon grounds not raised prior to
the verdict. Here, this rule is easily met: BestMed has prеssed its invalidity contentions since well before the jury was sworn, the jury was instructed as to invalidity, and BestMed presented its present invalidity contentions, and its supporting evidence, on the record.
Id. at 4.
While Medisim may not have been surprised by BestMed‘s invalidity contentions, the Supreme Court has held previously that our Federal Rules of Civil Procedure are to be strictly followed in circumstances such as this one. In Unitherm, for example, a party moved for a directed verdict under
With that principle in mind, we conclude that BestMed forfeited its right to move for JMOL on anticipation. The statement that BestMed now relies on as evidence of a motion for JMOL actually indicates the opposite—BestMed‘s counsel stated that anticipation was “definitely something for the jury.” J.A. 4530. Further, BestMed‘s counsel made this statement in opposition to Medisim‘s motion for JMOL under
Because we vacate the district court‘s grant of JMOL on anticipation due to forfeiture, we need not consider whether the district cоurt erred in granting JMOL on anticipation on the merits.
2. No Forfeiture of JMOL on Unjust Enrichment
We next turn to Medisim‘s procedural challenge to the district court‘s grant of JMOL on unjust enrichment. Again, Medisim argues that BestMed forfeited its right to move for JMOL under
BestMed responds that it expressly moved for JMOL of no unjust enrichment at the close of Medisim‘s case-in-chief, generally contending that “[t]here is no evidence of unjust enriсhment” and particularly challenging Medisim‘s evidence on each element of the claim. J.A. 4141. BestMed alleges that the district court cut BestMed‘s counsel off and denied the motion. When BestMed‘s counsel tried to renew BestMed‘s JMOL motions later, the district court barred any further discussion, saying “you preserved the record.” J.A. 4398.
We conclude that BestMed did not forfeit its right to move for JMOL on unjust enrichment under
B. Grant of JMOL on Unjust Enrichment
The Second Circuit reviews “a district court‘s resolution of a motion for judgment as a matter of law” de novo and applies “the same standard as the district court itself was required to apply.” Diesel v. Town of Lewisboro, 232 F.3d 92, 103 (2d Cir.2000). In doing so, the Second Circuit will “consider the evidence in the light most favorable to the non-moving party and give that party the benefit of all reasonable inferences from the evidence that the jury might have drawn in that party‘s favor,” id., but “cannot assess the weight of conflicting evidence, pass on the credibility of the witnesses, or substitute its judgment for that of the jury,” LeBlanc-Sternberg v. Fletcher, 67 F.3d 412, 429 (2d Cir.1995). Unjust enrichment requires “1) that the defendant benefited; 2) at the plaintiff‘s expense; and 3) that equity and good conscience require restitution.” Kaye v. Grossman, 202 F.3d 611, 616 (2d Cir.2000).
Below, the district court found that there was no еvidence in the record to support the jury‘s award of damages to Medisim for unjust enrichment. Medisim, 959 F.Supp.2d at 425-26. It noted that
Medisim argues that its unjust enrichment claim is based on the enrichment that BestMed obtained from selling thermometers developed through the unauthorized use of Medisim‘s proprietary, non-public information, to Medisim‘s detriment. Specifically, Medisim argues that it developed a successful water bath testing procedure, which was a prerequisite to selling thermometers in the United States. It claims that it was particularly difficult to develop a reliable procedure for devices that calculated approximations of core body temperatures rather than temperаtures measured at the surface of the skin.
BestMed responds that although Medisim now makes water bath testing the focus of its unjust enrichment case, that issue was only a small part of Medisim‘s overall unfair competition case below, and Medisim never asked the jury to find unjust enrichment on that basis. Indeed, BestMed argues that the unjust enrichment claim “fell in the interstices” of Medisim‘s other claims. See Medisim, 959 F.Supp.2d at 417.
We agree with BestMed. During trial, Medisim failed to present any evidence to support a finding that BestMed received an incremental benefit from Medisim‘s allegedly proprietary water bath testing procedure over that compensable by the patent laws. It grouped together its patent and non-patent damages claims, relying on BestMed‘s profits from all of the accused products. See Medisim, 959 F.Supp.2d at 426 n. 182. Medisim offered no evidence to show why BestMed had reason to think that Medisim‘s procedures for water bath testing were confidential or otherwise proprietary. Thus, even when viewing all the evidence in the light most favorable to Medisim, we cannot conclude that equity and good conscience require restitution.
C. Conditional Grant of New Trial on Anticipation
Finally, we turn to the district court‘s conditional grant of a new trial. A court may set aside the verdict and order a new trial even if no motion for JMOL was made under
Below, the district court did not elaborate on its reasons for granting BestMed‘s motion for a new trial, conditioned on our determination that BestMed failed to preserve its right to bring a post-trial motion for JMOL on anticipation. Instead, it made its ruling in a footnote. See Medisim, 959 F.Supp.2d at 421 n. 158.
Medisim challenges the district court‘s reasoning, or more accurately the lack
However, BestMed argues this was not a case where the court found the verdict against the weight of the evidence without further elaboration. It notes that the district court provided a detailed explanation as to why it found that BestMed had proven anticipation. See Medisim, 959 F.Supp.2d at 420-25.
We agree with BestMed. Given the context and the surrounding discussion, the district court‘s reasoning is clear enough to pass
The record shows that Medisim‘s expert witness, Dr. Lipson, conceded that the FHT-1 calculated an intermediate temperature and that if “the intermediate temperature calculated by the prior art FHT-1 thermometer, is a deep tissue temperature,” then the FHT-1 anticipates claim 1 of the ‘668 patent and “whatever [other claims] require[] the deep tissue limitation.” J.A. 4442-43. Therefore, as the district court correctly noted, anticipation turns on one issue in this case: whether the intermediate temperature concededly calculated by the FHT-1 using the heat-flux algorithm of the ‘397 patent qualifies as a deep tissue temperature as claimed in the ‘668 patent.
The specification of the ‘668 patеnt relies on the ‘397 patent to provide the algorithm to compute its deep-tissue temperature. The ‘668 patent defines a local, deep-tissue temperature as “a temperature at a location under the skin that is the source of heat conducted to the sensors in the probe.” ‘668 patent col. 6 ll. 59-62. It also expressly describes the “heat flux calculation” of the ‘397 patent as a method “to rapidly compute a deep tissue temperature of the body.” Id. at сol. 1 ll. 65-67 (emphasis added). The specification further describes a processing unit that uses the heat-flux algorithm of the ‘397 patent to generate the deep-tissue temperature. Id. at col. 6 ll. 55-59 (“Using the heat flux algorithm described in the above-mentioned U.S. Pat. No. 6,280,397 ..., the processing unit calculates from the temperature readings a local temperature.“); col. 7 ll. 16-17 (“[T]he value of local body temperature determined by the ‘397 algorithm.“). In the preferred embodiment, the deep-tissue tempеrature is converted to a core-body temperature using an equation that includes the output of the heat-flux algorithm of the ‘397 patent, denoted Tavg. Id. at col. 9 ll. 34-36 (equation); col. 9 ll. 62-63 (defining Tavg as the output of the heat-flux algorithm of the ‘397 patent). This intrinsic evidence, all discussed by the district court, heavily supports the conclusion that the FHT-1 calculates a deep tissue temperature and, therefore, anticipates the ‘668 patent.
While we acknowledge that the district court‘s discussion of the aforementioned evidence ends with the grant of JMOL on anticipation, we conclude that this same reasoning is applicable to the conditional grant of a new trial. Therefore, the district court‘s conditional grant of a new trial was amply supported by the evidence. It did not abuse its discretion in granting BestMed‘s motion for a new trial.
Medisim also challenges the district court‘s statement that, should the case be remаnded for a new trial, it would “then entertain a motion for summary judgment on anticipation.” Medisim, 959 F.Supp.2d at 421 n. 158. It argues that the district court has already “pre-judged this summary judgment motion in BestMed‘s favor.” Appellant‘s Br. 57. But Medisim‘s contention is premature. We repeat, however, what we said in a previous case: “In remanding for a limited new trial [on literal infringement and obviousness] ... we do not foreclose the district court from entertaining a motion for summary judgment on these issues that might obviate the need for a further trial.” ArcelorMittal Fr. v. AK Steel Corp., 700 F.3d 1314, 1326 (Fed.Cir.2012).
IV. CONCLUSION
For the foregoing rеasons, we affirm the district court‘s grant of JMOL regarding Medisim‘s unjust enrichment claims. We vacate the district court‘s grant of JMOL regarding Medisim‘s anticipation claims but affirm its conditional grant of a new trial. We remand this case to the district court for further proceedings consistent with this opinion.
AFFIRMED-IN-PART, VACATED-IN-PART, AND REMANDED
