Perfect Surgical Techniques, Inc. v. Olympus Surgical & Industrial America Inc.

Filing 113

ORDER by Judge Hamilton denying 81 Motion for Leave to File; denying 82 Motion to Amend/Correct; granting 72 Motion for Summary Judgment; granting 71 Administrative Motion to File Under Seal. (pjhlc2, COURT STAFF) (Filed on 12/16/2013)

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UNITED STATES DISTRICT COURT
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NORTHERN DISTRICT OF CALIFORNIA
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PERFECT SURGICAL TECHNIQUES,
INC.,

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Plaintiff,

No. C 12-5967 PJH

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v.
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OLYMPUS AMERICA, INC., et al.,
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For the Northern District of California

United States District Court

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Defendants.
_______________________________/

ORDER DENYING MOTIONS FOR
LEAVE TO AMEND INFRINGEMENT
CONTENTIONS AND TO FILE SECOND
AMENDED COMPLAINT; GRANTING
MOTION FOR SUMMARY JUDGMENT

Defendants’ motion for summary judgment of invalidity of the ’384 patent, plaintiff’s

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motion for leave to file amended infringement contentions, and plaintiff’s motion for leave to

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file a second amended complaint came on for hearing before this court on September 4,

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2013. Plaintiff Perfect Surgical Techniques, Inc. (“plaintiff” or “PST”) appeared through its

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counsel, Qudus Olaniran and Daniel Weinberg. Defendants Olympus America Inc., Gyrus

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Medical, Inc., and Gyrus ACMI, L.P. (“defendants”) appeared through their counsel,

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Deborah Fishman, Katie Scott, Eric Kurtycz, and Kiyoshi Miyake. Having read the papers

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filed in conjunction with the motions and carefully considered the arguments and the

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relevant legal authority, and good cause appearing, the court hereby DENIES plaintiff’s

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motion for leave to file amended infringement contentions, DENIES plaintiff’s motion for

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leave to file a second amended complaint, and GRANTS defendants’ motion for summary

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judgment as follows.

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Although defendants filed their motion for summary judgment before plaintiff filed its

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motions, the court will address plaintiff’s motion for leave to amend its infringement

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contentions first, as it presents a threshold issue that must be resolved before considering

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defendants’ motion for summary judgment.

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Patent Local Rule 3-6 allows a party to amend its infringement contentions only by

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order of the court upon a timely showing of good cause. Though Local Rule 3-6 does not

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expressly define the boundaries of what constitutes “good cause,” it provides the following

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non-exhaustive list: (1) a claim construction by the court different from that proposed by the

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party seeking amendment, (2) recent discovery of material, prior art despite earlier diligent

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search, or (3) recent discovery of non-public information about the accused instrumentality

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which was not discovered, despite diligent efforts, before the service of infringement

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contentions.

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In this case, plaintiff seeks to amend its infringement contentions to remove its

No. 6,030,384 (“the ’384 patent”). Specifically, plaintiff seeks to withdraw its infringement

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For the Northern District of California

infringement allegations against four of the five products accused of infringing U.S. Patent

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United States District Court

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allegations against the PKS Cutting Forceps, the PKS HALO Cutting Forceps, the PKS

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Omni, and the HiQ+ Johann Forceps, and seeks to serve amended infringement

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contentions accusing only one product, the Thunderbeat Forceps, of infringement.

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Plaintiff’s stated reason for seeking this amendment is that, at an Early Neutral Evaluation

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session on May 31, 2013, plaintiff “gained a better understanding of its case,” and after it

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“considered and evaluated the information presented by defendants in the ENE session

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and the analysis of the neutral evaluator,” it “concluded that its infringement contentions

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were not accurate and that it would need to narrow the scope of its allegations with respect

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to the ’384 patent.” See Dkt. 95 at 2, Dkt. 82 at 3. However, plaintiff does not identify any

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new information that it discovered at the ENE session. Instead, it explains that “its original

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construction of the disputed term ‘wherein electrode members lie parallel to and laterally

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spaced-apart from each other when the jaws are closed’ was too narrow and put too much

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emphasis on ‘parallel’ and not enough emphasis on ‘laterally spaced.’” Dkt. 95 at 2-3.

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However, it appears that plaintiff’s reevaluation of its claim construction position was not

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triggered by newly-discovered non-public information that it learned at the ENE session,

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and instead, could have been triggered by a simple examination of the product itself, which

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should have occurred before plaintiff served its infringement contentions in the first place.

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Defendants raise another possible explanation for plaintiff’s decision to seek leave to
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amend its infringement contentions – shortly before the ENE session, plaintiff was informed

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that a predecessor to one of the accused products (specifically, the BiCOAG Cutting

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Forceps, the predecessor product to the accused PKS Cutting Forceps) was on sale more

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than one year before the filing of the ’384 patent, thus exposing the ’384 patent to an

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invalidity challenge based on 35 U.S.C. § 102(b). Defendants argue that plaintiff seeks to

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amend its contentions solely to avoid a finding of invalidity.

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While the court cannot make a definitive determination as to plaintiff’s motives in

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seeking to amend its infringement contentions, the court does find it likely that plaintiff

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seeks this amendment in order to avoid a finding of invalidity. But more importantly, the
court finds that plaintiff has not satisfied its burden to show “good cause” under Patent

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For the Northern District of California

United States District Court

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Local Rule 3-6. If plaintiff had offered a competing explanation for its change of heart with

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regard to its claim construction position, the court might have been persuaded that plaintiff

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did not seek amendment as a strategy to avoid a finding of invalidity. Indeed, parties are

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permitted to change and refine their claim construction positions over the course of a case,

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especially when such changes would serve to narrow the scope of the suit. However, in

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the absence of any explanation as to why plaintiff could not have reconsidered its claim

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construction position earlier in the case, the court finds that plaintiff cannot meet the “good

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cause” requirement of Patent Local Rule 3-6, and thus DENIES plaintiff’s motion for leave

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to amend its infringement contentions. As plaintiff’s motion for leave to file a second

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amended complaint seeks the same relief (i.e., the withdrawal of infringement allegations

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against four of the products accused of infringing the ’384 patent), that motion is DENIED

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for the same reasons.

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Having determined that plaintiff cannot amend its infringement contentions, the court

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now turns to defendants’ motion for summary judgment of invalidity. Defendants argue that

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plaintiff accuses the PKS Cutting Forceps of infringing the ’384 patent, that the PKS Cutting

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Forceps are identical in all material respects to the predecessor BiCOAG Cutting Forceps,

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and that the BiCOAG Cutting Forceps were on sale more than one year before the filing of

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the ’384 patent, thus rendering the ’384 patent invalid under 35 U.S.C. § 102(b).
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Defendants further argue that they are relieved of their usual burden of showing that the

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BiCOAG Forceps anticipate the claims of the ’384 patent by conceding infringement by the

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PKS Cutting Forceps, and by showing that the PKS Cutting Forceps are indeed identical in

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all material respects to the BiCOAG Cutting Forceps. Defendants further point to the

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Federal Circuit decisions in Evans Cooling Systems v. General Motors Corp. and Vanmoor

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v. Wal-Mart Stores, Inc. as additional support for their position. Evans Cooling, 125 F.3d

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1448 (Fed. Cir. 1997); Vanmoor, 201 F.3d 1363 (Fed. Cir. 2000).

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Plaintiff does not dispute that the BiCOAG Cutting Forceps are identical in all

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material respects to the accused PKS Cutting Forceps, nor does it dispute that the BiCOAG
Cutting Forceps were on sale more than one year before the ’384 patent was filed.

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For the Northern District of California

United States District Court

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Instead, plaintiff’s opposition to defendants’ motion is based on the argument that it has

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withdrawn (or, attempted to withdraw) its infringement allegations against the PKS Cutting

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Forceps, and that the court must first construe the claims of the ’384 patent before finding it

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invalid.

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The court agrees that, without the benefit of a claim construction proceeding, a

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universal finding of invalidity would be premature. However, as discussed above, plaintiff

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has not shown good cause to amend its infringement contentions, so the PKS Cutting

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Forceps remain in the case. And, as a result, the reasoning of Evans Cooling and

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Vanmoor does apply in this case. Plaintiff has accused the PKS Cutting Forceps of

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infringement, and defendants have presented unopposed evidence that the BiCOAG

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Forceps (which were on sale more than one year before the filing of the ’384 patent) are

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identical in all material respects to the PKS Cutting Forceps. Thus, defendants are entitled

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to summary judgment. However, because the court has not issued a claim construction

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order, and thus has not compared the BiCOAG Cutting Forceps, on a limitation-by-

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limitation basis, to the construed claims of the ’384 patent, the court adopts an approach

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similar to that taken in Biogenex Labs. v. Ventana Medical Systems, Inc. and GRANTS

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defendants’ summary judgment of invalidity for purposes of this lawsuit only.

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In Biogenex, the plaintiff sought leave to amend its infringement contentions to
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assert an earlier priority date than was first asserted. 2005 U.S. Dist. LEXIS 45531, at *9

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(N.D. Cal. Feb. 24, 2005). The Biogenex defendant had previously filed a motion for

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summary judgment of invalidity based on section § 102(b), identifying a printed publication

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that described the subject matter of the asserted claims. Id. at *8. The Biogenex court

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noted that, like this case, plaintiff’s “motion for leave to amend constitutes the entirety of

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[plaintiff’s] opposition to [defendant’s] motion for summary judgment of invalidity,” and that

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“resolution of the motions . . . turns upon whether [plaintiff] has demonstrated good cause

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for amendment.” Id. at *9-10. The Biogenex court found that the plaintiff had not

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demonstrated good cause, and that allowing it to amend its infringement contentions
“would permit the very ‘shifting sands’ approach that the Patent Local Rules were designed

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For the Northern District of California

United States District Court

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to avoid,” and thus granted the defendant’s motion for summary judgment for purposes of

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that lawsuit only. Id. at *13.

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Like in Biogenex, the court finds that resolution of the motions turns on whether

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plaintiff has demonstrated good cause for amendment, and thus, reaches the same result

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as to both the motion for leave to amend and the motion for summary judgment. And as in

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Biogenex, the court’s grant of invalidity shall apply to this lawsuit only.

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Finally, the court GRANTS defendants’ motion to seal Ex. A to the Baden

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declaration, Ex. 13 to the Scott declaration, and those portions of the Baden declaration

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which describe Exhibit A.

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IT IS SO ORDERED.
Dated: December 16, 2013
______________________________
PHYLLIS J. HAMILTON
United States District Judge

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