Judge Zobel Finds No Inequitable Conduct By Smith & Nephew And Refuses To Set Aside Jury Verdict Of Infringement And Validity

Smith & Nephew, Inc. v. Interlaced Medical, Inc., C.A. No. 10-10951-RWZ, 2013 WL 3289085 (D. Mass. June 27, 2013) (Zobel, D.J.) [Inequitable Conduct, Permanent Injunction, Damages]

Following a ten-day jury trial on infringement and validity and a two-day bench trial on inequitable conduct, the Court (Zobel, D.J.) denied Defendants' motions for judgment as a matter of law, found no inequitable conduct, and ordered that a permanent injunction shall enter if and when the patents-in-suit survive reexamination. In addition, the Court instructed the parties to report on how they wish to address the jury's hopelessly ambiguous damages award.

Smith and Nephew ("S&N") filed suit against Interlace Medical, Inc. and Hologic, Inc. (collectively, "Holigic") for infringing two patents—U.S. Patent No. 7,226,459 (the "'459 patent"), relating to an arthroscopic surgical instrument, and U.S. Patent No. 8,061,359 (the "'359 patent"), relating to a surgical endoscopic cutting instrument. The jury found all claims valid and infringed.

First, the Court summarily denied Holigic's motion for judgment as a matter of law. With little to no discussion, the Court concluded that it was "persuaded that the jury had a legally sufficient evidentiary basis for the factual determinations that underlie [the legal] conclusions."

Second, the Court detailed its findings of fact and conclusions of law with respect to inequitable conduct. Holigic asserted inequitable conduct claims against the inventor, Dr. Marc Hans Emanuel, and S&N's in-house prosecuting attorney, Norman Hainer. Applying the standard announced in Thereasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276 (2011), the Court analyzed the allegations against each individual separately.

As to Emanuel, Judge Zobel found that his statements during prosecution suggesting that a certain outlet channel was novel did not amount to "affirmative egregious conduct." Because there was no dispute that the described outlet channel was contained in the pre-existing Olympus endoscope, the Court found Emanuel's description of the invention "somewhat misleading." But it also found that the statements did not rise to the level of "false statements, manufactured evidence, or other blatant deceit." The Court further held that Emanuel's failure to disclose the Olympus endoscope did not amount to inequitable conduct. Judge Zobel pointed out that Hologic's evidence with regard to intent rested solely on circumstantial evidence. While...