Mobile Medical International Corporation v. Advanced Mobile Hospital Systems, Inc. et al

Filing 197

OPINION AND ORDER granting 146 Motion for Judgment on the Pleadings on Plaintiff's Affirmative Defense of Inequitable Conduct Before the United States Patent and Trademark Office. Signed by Judge William K. Sessions III on 10/29/2015. (law)

UNITED STATES DISTRICT COURT
FOR THE
DISTRICT OF VERMONT
MOBILE MEDICAL INTERNATIONAL
CORPORATION,
Plaintiff,
v.
ADVANCED MOBILE HOSPITAL
SYSTEMS, INC., TRACTUS
MEDICAL, INC., and JOHN
DOES 1-10,
Defendants.

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Case No. 2:07-cv-231

OPINION AND ORDER
Plaintiff Mobile Medical International Corporation (“MMIC”)
has filed suit seeking a declaratory judgment as to its alleged
infringement of U.S. Patent No. 4,915,435 (the “‘435 Patent”).
MMIC also challenges the validity of the ‘435 Patent.

Defendants

Tractus Medical, Inc., which allegedly owns the ‘435 Patent, and
Advanced Mobile Hospital Systems, Inc. (collectively “AMoHS”)
have filed a counterclaim for patent infringement.
Pending before the Court is AMoHS’s motion for judgment on
the pleadings with respect to MMIC’s affirmative defense of
inequitable conduct.

ECF No. 146.

MMIC claims that during a re-

examination of the ‘435 Patent by the United States Patent and
Trademark Office (“PTO”), AMoHS acted inequitably by failing to
disclose existing “prior art” of which it was aware.

The AMoHS

motion contends that MMIC’s affirmative defense is inadequately
pled.

The motion is unopposed.

For the reasons set forth below, the motion for judgment on
the pleadings is granted.
Factual Background
The ‘435 Patent describes a transportable van in which
invasive surgical procedures can be performed.

It includes a

laterally expandable portion that defines the operating room,
with an operating table that can remain in the vehicle when the
expandable portion is retracted.

The unit includes all essential

facilities for complete invasive surgical procedures, including
pre- and post-op areas.
MMIC is a manufacturer of temporary surgical units, known as
“mobile medical units.”

Having been accused by AMoHS of patent

infringement, MMIC filed this lawsuit on October 30, 2007
challenging both the infringement claim and the ‘435 Patent’s
validity.

AMoHS, of which Tractus Medical Inc. is a subsidiary,

responded with a counterclaim for infringement.

On February 25,

2008 and March 29, 2009, MMIC asked the PTO to reexamine the ‘435
Patent.

The instant litigation was stayed on August 27, 2008

pending the outcome of the reexaminations.
During the first reexamination, the PTO found the claims in
the ‘435 Patent unpatentable.

The decision was reversed by the

Board of Patent Appeals and Interferences, which found claims 118 and 30 valid.

The parties then returned to this Court, and

the instant litigation recommenced in 2012.
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On March 21, 2013, MMIC filed its most recent answer to the
infringement counterclaim.
“additional defenses.”

The answer included various

ECF No. 92 at 7-8.

Among those is a

defense of inequitable conduct, in which MMIC claims that AMoHS
and others, including Defendants’ counsel, failed to disclose
certain “prior art” during the reexaminations.

That defense

alleges in full as follows:
The ‘435 patent is unenforceable, at least because,
upon information and belief, at least as early as
February 2001, both the patentee and his counsel were
aware of multiple materially relevant prior art
references depicting medical vans with expandable or
telescoping sides, including but not limited to
publications cited to patentee by counsel for another
accused infringer. Upon information and belief, these
material prior art references were known to one or more
of Defendants and/or their alter egos and/or their
principals not later than 2001, and again in February
2005, as evidenced by correspondence finally produced
by Defendants in January 2013. These material prior
art references were not cited during the original
examination of the application that led to the ‘435
patent or during reexamination 90/009,055 or
reexamination 90/101,466 of the ‘435 patent. These
prior art references were more relevant than the
references cited during the original examination, and
would have been material to the reexamination of the
‘435 patent because they clearly depict an “operating
room” with mounted equipment not removed from the
operating room when the expandable sides of the van
expand or nest. The Defendants, their alter egos,
their agents, and the inventor also failed to provide
materially relevant information regarding expandable
mobile lithotripsy units and expandable cardiac
catheterization units to the USPTO, despite the
inventor’s knowledge that the alleged distinction
between the operating room of such prior art units and
the operating room or “invasive surgery room” of his
alleged invention was merely the intended use of the
room, i.e., that users of his alleged invention would
simply scrub their hands, clean surfaces carefully, and
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wear surgical clothes (“greens”) and surgical masks in
order to make the expandable room “sterile” for
surgical procedures.
ECF No. 92 at 7-8.

AMoHS now moves to dismiss this defense for

inadequate pleading.
Discussion
AMoHS submits its motion pursuant to Fed. R. Civ. P. 12(c)
seeking judgment on the pleadings.

As a preliminary matter, it

is not clear that the motion is filed under the appropriate rule.
Rule 12(c) generally applies to affirmative claims, while a
separate rule, Fed. R. Civ. P. 12(f), allows the Court to “strike
from a pleading an insufficient defense.”

As the current motion

seeks dismissal of an affirmative defense, the Court will apply
Rule 12(f).

See Wireless Inc. Corp. v. Facebook, Inc., 787 F.

Supp. 2d 298, 300 (S.D.N.Y. 2011) (construing motion to dismiss a
defense in a patent case as a motion to strike under Rule 12(f));
Bazazi v. Michaud, 856 F. Supp. 33, 34 (D.N.H. 1994) (construing
plaintiff’s motion for judgment on the pleadings as motion to
strike affirmative defenses pursuant to Rule 12(f)).
AMoHS argues that MMIC’s assertion of facts lacks the level
of specificity required for an inequitable conduct claim, and
should therefore be dismissed.1

In the context of a patent

1

AMoHS’s motion is unopposed. Notwithstanding the lack of
opposition, the Court has a duty to review the record to determine
whether the moving party has established its entitlement to judgment
as a matter of law. Vt. Teddy Bear Co. v. 1–800 Beargram Co., 373
F.3d 241, 246 (2d Cir. 2004).

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claim, Federal Circuit law determines the applicable pleading
standard.

Exergen Corp. v. Wal–Mart Stores, Inc., 575 F.3d 1312,

1326 (Fed. Cir. 2009).

A claim of patent unenforceability

premised upon inequitable conduct sounds in fraud.

Because it

sounds in fraud, the claim or defense must be pled with
particularity as required by Federal Rule of Civil Procedure
9(b).

Id. at 1331 (citing Ferguson Beauregard/Logic Controls,

Div. of Dover Res. v. Mega Systems, LLC, 350 F.3d 1327, 1344
(Fed. Cir. 2003)).

To plead inequitable conduct “with the

requisite ‘particularity’ under Rule 9(b), the pleading must
identify the specific who, what, when, where, and how of the
material misrepresentation or omission committed before the PTO.”
Id. at 1328; see also Evonik Degussa GmbH v. Materia Inc., 2012
WL 4503771, at *6 (D. Del. Oct. 1, 2012) (discussing Exergen as
the applicable heightened pleading standard for inequitable
conduct).
“The substantive elements of inequitable conduct are: (1) an
individual associated with the filing and prosecution of a patent
application made an affirmative misrepresentation of a material
fact, failed to disclose material information, or submitted false
material information; and (2) the individual did so with a
specific intent to deceive the PTO.”

Exergen, 575 F.3d at 1327

n.3; see also Delano Farms Co. v. California Table Grape Comm’n,
655 F.3d 1337, 1350 (Fed. Cir. 2011), cert. denied, 133 S. Ct.

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644 (2012).

While intent “may be averred generally” under Rule

9(b), a pleading of inequitable conduct “must include sufficient
allegations of underlying facts from which a court may reasonably
infer that a specific individual” acted with the requisite state
of mind.

Exergen, 575 F.3d at 1328.

In Exergen, the Federal Circuit found that the inequitable
conduct claim was insufficiently pled because it failed to “name
the specific individual associated with the filing or prosecution
of the application . . . who both knew of the material
information and deliberately withheld or misrepresented it.”
at 1329.

Id.

The complaint in that case alleged only that “‘Exergen,

its agents and/or attorneys’” had committed inequitable conduct.
Id.
AMoHS contends that MMIC’s pleading is similarly flawed.
Indeed, MMIC’s allegations claim that “[t]he Defendants, their
alter egos, their agents, and the inventor failed to provide
materially relevant information . . . .”

ECF No. 92 at 8.

In

Exergen, the Federal Circuit explicitly required that a “specific
individual” be identified.

575 F.3d at 1328.

Aside from the

inventor, who is not a defendant in this case, MMIC’s pleading
does not identify any such individual.
The time period of the alleged offense or offenses is also
vague.

MMIC claims that wrongful acts began “at least as early

as February 2001” and took place “again in February 2005.”

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ECF

No. 92 at 8.

The open-ended nature of the phrase “at least as

early as” requires guesswork as to how many times, and precisely
when, the alleged omissions would have taken place.
The contents of the alleged omissions are equally unclear.
In Exergen, the Federal Circuit noted that in a prior case
“inequitable conduct was alleged on the basis that an applicant
‘failed to disclose all the relevant prior art known to it,’
[and] we found this allegation deficient because it did not
identify the specific prior art that was allegedly known to the
applicant and not disclosed.”

575 F.3d at 1327 (quoting Cent.

Admixture Pharm. Servs., Inc., v. Advanced Cardiac Sols., P.C.,
482 F.3d 1347, 1356-67 (Fed. Cir. 2007)).

Here, MMIC makes vague

references to lithotripsy and catheterization units, but does not
identify with precision the prior art that depicted these units.
MMIC’s pleadings therefore fail to meet the requirements of Rule
9(b), as interpreted by the Federal Circuit.
In its briefing, AMoHS acknowledges that MMIC offered
greater specificity as to inequitable conduct in its Second
Supplemental Invalidity/Unenforceability Contentions.
146-1.

ECF No.

Those Contentions were served upon Defendants, but were

not provided to the Court until attached as an exhibit AMoHS’s
current motion.

The Federal Circuit has held that “inequitable

conduct, while a broader concept than fraud, must be pled with
particularity.”

Cent. Admixture Pharm. Servs., Inc., 482 F.3d at

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1356 (emphasis added).

MMIC submitted its contentions on April

3, 2014, but has not moved to amend its pleadings in the
approximately 18 months since that time.

Nor did MMIC file an

opposition to the current motion.
Given these facts, and the requirement for particularity
under Rule 9(b), the Court agrees that MMIC’s pleading is
insufficient.
Conclusion
For the reasons set forth above, AMoHS’s motion for judgment
on the pleadings on plaintiff’s affirmative defense of
inequitable conduct (ECF No. 146) is granted.
DATED at Burlington, in the District of Vermont, this 29th
day of October, 2015.
/s/ William K. Sessions III
William K. Sessions III
District Court Judge

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