Inguran, LLC et al v. ABS Global, Inc. et al

Filing 280

ORDER granting in part and denying in part 156 Motion for Partial Summary Judgment; denying 163 Motion for Partial Summary Judgment. This case and ABS v. Inguran, LLC, No. 14-cv-503, are consolidated for purposes of trial, commencing September 3, 2019. The court will hold a telephone scheduling conference on May 13, 2019 at 10:00 AM, counsel for plaintiff to establish the call to chambers at [phone]. Signed by District Judge William M. Conley on 4/29/2019. (arw)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF WISCONSIN
INGURAN, LLC, CYTONOME/ST,
LLC, and XY, LLC,
Plaintiffs and Counter Defendants,
OPINION AND ORDER
v.

17-cv-446-wmc

ABS GLOBAL, INC., GENUS PLC, and
PREMIUM GENETICS (UK) LTD,
Defendants and Counter Claimants.
This is the second of two opinions on the parties’ cross-motions for claims
construction and summary judgment in this patent lawsuit. As detailed in the court’s prior
order, plaintiffs Inguran, LLC, Cytonome/ST, LLC and XY, LLC, allege that the defendants
ABS Global, Inc., Genus PLC and Premium Genetics (UK) Ltd, have infringed six patents,
two owned by plaintiff XY and four owned by plaintiff Cytonome. In addition, all parties
assert claims and counterclaims under state law. In this opinion and order, the court
addresses the parties’ arguments as to the four Cytonome patents, as well as plaintiffs’
motion for summary judgment on defendants’ counterclaims for inequitable conduct and
breach of contract.
For the reasons that follow, the court will construe the “direction” terms in the
Cytonome patents consistent with defendants’ construction, requiring no overlap between
the direction or directions implicated in the first step and the direction or directions
implicated in the second step, but will adopt plaintiffs’ position with respect to the term
“focusing,” construing that term to include the prosecution disclaimer requiring
acceleration and to exclude the mere introducing of a sample fluid at a particular position

in a straight flow passage. As for the motions for summary judgment, the court will grant
defendants’ motion of noninfringement as to the ’161 and ’912 patents, finding that the
only disclosed infringement theory for those patents fails to meet the direction limitation.
The court will also grant, in part, defendants’ motion of noninfringement as to the ’476
and ’309 patents, finding any infringement theory based on Detail B as the primary
focusing or first step also fails to satisfy the direction limitation. Next, the court will also
deny defendants’ motion for summary judgment as to the three anticipation claims, finding
disputed issues of material fact. For the same reason, the court will deny plaintiffs’ motion
for a finding in their favor on defendants’ anticipation claims based on the prior art
reference Tashiro. Finally, the court will deny plaintiffs’ motion for summary judgment
on defendants’ counterclaims for inequitable conduct and breach of contract, finding
material factual disputes as to each.

UNDISPUTED FACTS 1
A. Patents-In-Suit
Plaintiff Cytonome asserts claims of infringement as to four of its patents: U.S.
Patent Nos. 7,311476 (“the ’476 patent”), 7,611,309 (“the ’309 patent”), 8,529,161 (“the
’161 patent”), and 9,446,912 (“the ’912 patent”). (Dkt. ##1-1 to 1-4.) The parties refer
to these four patents collectively as the “Cytonome patents.” All four share the same title,
“Multilayer Hydrodynamic Sheath Flow Structure,” each name the same three inventors:

The court also incorporates here the relevant facts from the prior summary judgment opinion and
order.

1

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John R. Gilbert, Manish Deshpande and Bernard Bunner, and they share a specification.
Generally speaking, the Cytonome patents are directed to microscale devices and
techniques for controlling the flow of particles and fluids in small channels, which is useful
for flow cytometry and particle-sorting applications. The Cytonome patents all claim
priority under the same provisional application, No. 60/516,033, filed on October 30,
2003, although plaintiffs assert an earlier date of invention of March 3, 2003.
Figure 1 of the ‘476 patent, as well as the other Cytonome patents, depicts a “sheath
flow structure” (10):

(’476 patent at Fig. 1.) “The sheath flow structure 10 includes a primary sheath flow
channel 12 for conveying sheath fluid through the sheath flow channel 10.” (Id. at 4:3840.) A sample inlet is identified as 15. (Id. at 4:44.) The “primary focusing region” is
identified as 17, and the specification provides that this region “accelerates and focuses the
sheath fluid around the injected sample.” (Id. at 4:64-65.) A “second focusing region” is

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disclosed at 19, with 19A disclosing an outlet.” (Id. at 4:67-5:1, 5:19.)
Plaintiffs propose several facts showing figures of the embodiments of the Cytonome
patents, purportedly showing a “horizontally-tapered channel in two regions.” (Pls.’ Add’l
PFOFs (dkt. #197) ¶ 97.) Defendants dispute this, pointing to Figure 4A, arguing that
there is “no tapering in the secondary focusing region.” (Defs.’ Resp. to Pls.’ Add’l PFOFs
(dkt. #219) ¶ 97.) Figure 4A “is a perspective cross-sectional view of the sheath flow
structure 100 illustrating the sheath fluid and suspending particle during the different
stages of producing a sheath flow.”

(’476 patent at Fig. 4A.)
The asserted independent claims of the Cytonome patents contain the same or
similar language involving a “direction” requirement or limitation that an action -- either
focusing, injecting or adjusting -- occurs in “at least a first direction,” and then at a second
region, focusing, injecting or adjusting occurs in “at least a second direction different from

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the first direction.” 2 Moreover, three of the Cytonome patents -- the ’476, ’309, and ’161
patents -- contain claims that require “focusing” of the sheath fluid around the particle or
sample.
Claim 1 of the ’476 patent requires:
1. A sheath flow structure for suspending a particle in a sheath
fluid, comprising:
a primary sheath flow channel for conveying a sheath fluid;
a sample inlet intersecting the primary sheath flow channel
at a sample injection site for injecting a particle into the
sheath fluid conveyed through the primary sheath flow
channel;
a primary focusing region extending downstream of the
sample injection site for focusing the sheath fluid around the
particle in at least a first direction; and
a secondary focusing region provided downstream of the
primary focusing region for focusing the sheath fluid around
the particle in at least a second direction different from the
first direction.
(’476 patent at 11:9-23 (emphasis added).)
Claim 14 of the ’309 patent provides:
14. A method of surrounding a particle on at least two sides by
a sheath fluid, comprising the steps of:
conveying the sheath fluid through a primary sheath flow
channel;
injecting the particle into the sheath fluid conveyed
through the primary sheath flow channel;
focusing the sheath flow around the particle in at least a first
direction; and
focusing the sheath fluid around the particle in at least a
second direction different from the first direction.
(’309 patent at 12:27-37 (emphasis added).)

As quoted below, the direction language in the ’912 patent differs slightly, requiring “a first
direction away from a first wall” and a “second direction away from a second wall.” (’912 patent
at 11:30-31, 35-36.)
2

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Claim 1 of the ’161 patent requires:
1. A microfluidic system comprising:
a primary flow channel for flowing a sample having one or
more particles suspended in a suspension medium;
a primary adjustment region including a first set of one or
more inlets intersecting the primary flow channel and
adapted for introducing additional suspension medium into
the primary flow channel, whereby the sample is adjusted
in at least a first direction; and
a secondary adjustment region downstream of the primary
alignment region and including a second set of one or more
inlets intersecting the primary flow channel downstream of
the first set of one or more inlets and adapted for
introducing additional suspension medium whereby the
sample is adjusted in at least a second direction different from
the first direction.
(’161 patent at 10:63-11:10.) For the ’161 patent, some of the independent claims, such
as claim 1 quoted above, “adjusting” is disclosed, rather than “focusing.” The dependent
claims, however, require “focusing.” (See, e.g., ’161 patent, Claim 6 (“The system of claim
1, wherein adjusting the sample in at least a first direction and adjusting the sample in at
least a second direction includes focusing the sample.” (emphasis added)).)
Finally, claim 1 of the ’912 patent provides:
1. A flow structure for suspending a particle in a sheath fluid,
comprising:
a primary flow channel provided within a substrate and
configured to convey fluid in a downstream direction; and
a sheath fluid distribution system including:
a first sheath fluid channel in fluid communication with
the primary flow channel at a first sheath fluid
introduction region for injecting sheath fluid into the
primary flow channel in a first direction away from a first
wall of the primary flow channel; and
a second sheath fluid channel in fluid communication
with the primary flow channel at a second sheath fluid
introduction region for injecting sheath fluid into the
primary flow channel in a second direction away from a

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second wall of the primary flow channel,
wherein the second sheath fluid introduction region is
located downstream from the first sheath fluid introduction
region, and
wherein a width of the primary flow channel at the first
sheath fluid introduction region is greater than a width of
the primary flow channel at the second sheath fluid
introduction region.
(’912 patent at 11:21-44.)

B. Accused Infringing Technology
Following entry of this court’s injunction in ABS I, ABS launched its GSS
technology in September 2017. Plaintiffs allege that the GSS technology (or chip) and
another ABS technology, the single sheath chip, infringe their patents. 3 ABS contracts
with fabricators who make the GSS chip and the single sheath chip. ABS also imports and
uses both chips.
A top-view schematic of the GSS chip is depicted below:

(Pls.’ Add’l PFOFs (dkt. #197) ¶ 191.) Sheath fluid enters the chip through a sheath fluid

There are two versions of the accused GSS chip, versions 1.0 and 1.1, but the differences between
these versions are not material.

3

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inlet (1) and flows to Detail C through branching channels. Sheath fluid also enters the
chip through another sheath fluid inlet (2) and flows to Detail B through branching
channels. Sample fluid enters the chip through sample fluid inlet (3) and flows to Detail
B, where it is introduced to sheath fluid originating from inlet 2. Sample fluid and sheath
fluid flow through Details B, C and D. The first focusing step is in the circled area marked
as Detail B. The second focusing step takes place at Detail C. Additional focusing occurs
at Detail D.
An enlarged version of Detail B is depicted below:

(Id. ¶ 230.) In Detail B, defendants contend that the GSS chip “focuses in all four
directions (i.e., away from the top, bottom, and sides of the channel).”

(Id. ¶ 231.)

Plaintiffs purportedly dispute this characterization, and instead represent that the GSS
chip “focuses in a single radially inward direction.” (Pls.’ Resp. to Defs.’ PFOFs (dkt.
#196) ¶ 231; see also Pls.’ Add’l PFOFs (dkt. #197) ¶ 217.) Since focusing away from
external walls would appear to be the same as focusing radially inward, this dispute appears

8

to be a distinction without a difference, as addressed further below. The parties also
dispute whether the above depiction shows that “the channel tapers horizontally just after
the point where the sample is introduced to the sheath fluid” -- plaintiffs’ position -- or
that the depiction simply shows “two subchannels coming together, not a taper” -defendants’ position. (Defs.’ Resp. to Pls.’ Add’l PFOFS (dkt. #219) ¶ 197.) The court
also takes up this dispute below.
An enlarged view of Detail C is depicted below:

(Defs.’ PFOFs (dkt. #161) ¶ 232.) In Detail C, the parties agree that the GSS chip focuses
from above, away from the top wall, in a vertical direction to position the sample in the
center of the flow for detection.
Finally, an enlarged view of Detail D is shown below:

9

(Id. ¶ 234.) The parties dispute the proper characterization of Detail D. Defendants
maintain that “the GSS chip employs a vertical ramp along the bottom wall and tapering
along the left and right walls to increase the sample velocity just before the detection zone.”
(Id. ¶ 235.) However, plaintiffs assert that the ramp and taper are not a “single region.”
(Pls.’ Resp. to Defs.’ PFOFs (dkt. #196) ¶ 235; see also Pl.’s Add’l PFOFs (dkt. #197) ¶¶
214-15.) The parties also dispute whether the combined ramp and taper focus in all four
directions, as defendants contend, or “the horizontal taper in Detail D focuses away from
the left and right-side walls and the vertical ramp in Detail D focuses away from the bottom
wall,” disputing that the ramp also focuses from the top, as plaintiffs contend. (Pls.’ Resp.
to Defs.’ PFOFs (dkt. #196) ¶ 235; see also Pl.’s Add’l PFOFs (dkt. #197) ¶¶ 214-15.)
As set forth in part above, the asserted claims of the Cytonome patents all require
two steps: (1) the introduction, adjustment or focusing of fluid “in at least a first direction”
and (2) a second introduction, adjustment or focusing of fluid “in at least a second
direction different from the first.” (Defs.’ PFOFs (dkt. #161) ¶¶ 241-44.) For the GSS
chip, plaintiffs’ expert describes infringement theories based on: (1) Detail B as the first

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step and Detail C as the second step; (2) Detail B as the first step and Detail D (including
both the ramp and taper regions) as the second step; (3) Detail C as the first step and
Detail D (again including both the ramp and taper regions) as the second step; and (4)
Detail D’s ramp as the first step and Detail D’s taper as the second step.
The accused single sheath chip, as depicted below, has essentially the same design
as the GSS chip, but omits the second focusing region identified as Detail C in the GSS
chip:

(Pls.’ Add’l PFOFs (dkt. #197) ¶ 208.) Detail B in the single sheath chip is the same as
Detail B in the GSS chip, while Detail C in the ingle sheath chip corresponds to Detail D
in the GSS chip. For the single sheath chip, plaintiffs’ expert describes infringement
theories based on: (1) Detail B as the first step and Detail C (which is the same as GSS
chip’s Detail D) as the second step; and (2) Detail C’s ramp as the first step and Detail C’s
taper as the second step. 4

Defendants purport to dispute whether plaintiffs’ expert described a theory based solely on Detail
C as fulfilling both steps in the single sheath chip. That theory, however, was disclosed in Dr.
Vacca’s supplemental report. (Vacca Suppl. Rept. (dkt. #144) ¶¶ 9, 11, 19.)
4

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C. Prior Art References
The Cytonome patents use hydrodynamic focusing. Hydrodynamic focusing relies
on laminar flow in which two fluid layers (sample and sheath) maintain their relative
positions without substantial mixing. More specifically, the Cytonome patents rely on a
type of laminar flow, called “sheath flow,” in which the sample fluid is surrounded by sheath
fluid on more than one side. Prior to the Cytonome patents, it was known that: (1)
increasing the flow rate of the sheath fluid relative to the flow rate of the sample fluid
would narrow the diameter of the sample fluid; and (2) narrowing the dimensions of the
channel in which both fluids flow would narrow the diameter of the fluids in the channel.
With that brief background, the parties’ motions concern three prior art references: Weigl,
Tashiro and Wada.
1. Weigl
U.S. Patent No. 6,159,739, identified by one of its inventors Bernhard Weigl and
entitled “Device and Methods for 3-Dimentional Alignment of Particles in Microfabricated
Flow Channels,” was filed on March 26, 1997, and issued on December 12, 2000.
(Safiullah Decl., Ex. 7 (dkt. #166-7).) Weigl discloses a sheath flow structure that uses a
microfabricated flow channel to create a sheath flow around a sample that contains
particles. As reproduced below, a side view of an exemplary embodiment is disclosed in
Figure 5A:

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(Defs.’ PFOFs (dkt. #161) ¶ 278.) This embodiment includes a sheath fluid inlet (10b)
to introduce sheath fluid into the sheath flow channel (8b) at the first inlet junction (11b).
Downstream of the sheath fluid inlet is a sample inlet (20b), though which a sample fluid
containing particles is introduced into the sheath flow channel (8b) at the second inlet
junction (21b). This embodiment also depicts a second sheath fluid inlet (40) further
downstream of the sample inlet, which introduces additional sheath fluid at the third inlet
injunction (41). Weigl notes that the inlets may be located on the top or bottom of the
channel, and that the embodiment as a whole may be oriented in any direction.
Defendants characterize this embodiment as “pinching” the sheath fluid “away from
the channel walls on three sides as it flows downstream,” with the third inlet used to
“introduce sheath fluid on the fourth and final side,” thus “pinch[ing] the sample away
from” the fourth wall. (Defs.’ PFOFs (dkt. #218) ¶¶ 283-84.) Plaintiffs dispute this
characterization, arguing among other things that there is no “focusing.”
Weigl also provides a top-view of this same embodiment, identified as Fig. 5B:

13

(Defs.’ PFOFs (dkt. #161) ¶ 287.) Figure 5B discloses a horizontally tapered region (26b)
downstream of the first sheath inlet (11b), the sample inlet (21b), and the second sheath
inlet (41). The horizontal taper “may or may not occur in conjunction with a decrease in
depth of the flow channel,” such as in conjunction with the vertical ramp shown in the side
view in the previous Figure 5A just downstream of the dashed line marked 5D. (Id. ¶ 288
(quoting Weigl at 12:45-47).)
While the exemplary embodiment at Figure 5A depicts “the tapered region
downstream of both the sample inlet and sheath fluid inlet,” defendants contend Weigl
discloses that the tapered portion can alternatively be located at the sample inlet. (Id. ¶
289 (citing Weigl at 10:3-4).) Indeed, the cited portion of Weigl states that: “In this
embodiment, the second inlet is positioned in the upstream portion. It can alternatively
be in the tapered portion. It is preferable to position the second inlet in the upstream
portion because this allows for greater and more precise horizontal hydrodynamic
focusing.” (Weigl at 10:3-6.) Purporting to dispute this, plaintiffs point to the rebuttal
report of their expert, Dr. Vacca, but he does not dispute -- nor could he -- that this
language is in Weigl. Instead, Dr. Vacca relies on other language in the specification to
contend that Weigl teaches away from this configuration. (Vacca Rept. (dkt. #131) ¶ 229.)
While this may be true, just as the last sentence just quoted explains that positioning

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upstream is “preferable,” that language does not foreclose Weigl’s configuration of the
second inlet in the tapered portion. Instead, Dr. Vacca opines that “a person of skill would
have no reason to relocate the fluid introductions downstream of any tapered region.” (Id.)
2. Tashiro
The second prior art reference is an article, titled “Design and Simulation of
Particles and Biomolecules Handling Micro Flow Cells with Three-Dimensional Sheath
Flow,” which appears to have been published in the Micro Total Analysis Systems 2000:
Proceedings of the µTAS 2000 Symposium held in Enschede, The Netherlands, 14-18 May
2000. The parties identify this piece of prior art by the last name of the lead author Koichi
Tashiro. (Safiullah Decl., Ex. 9 (dkt. #166-9) (“Tashiro”).) Tashiro discloses “[p]articles
and cell handling micro fluidic devices . . . using laminar behavior in microfabricated flow
channels.” (Defs.’ PFOFs (dkt. #161) ¶ 299 (citing Tashiro at 209).) In this design, sheath
fluid enters a wider inlet (“Carrier Inlet”) upstream of the sample inlet, as shown below.

(Defs.’ PFOFs (dkt. #161) ¶ 300 (citing Tashiro at 210, Fig. 2).) Tashiro explains “[t]o
realize the vertical sheath flow with simple inlet structure of carrier and sample, [a] two

15

step[] introduction of carrier flows was considered . . . to realize three-dimensional sheath
flow,” as shown in the above graphic. (Id. ¶ 303 (citing Tashiro at 209).) Tashiro also
contains the following illustration, which defendants contend illustrates that “the design
hydrodynamically focuses the sample in three dimensions away from all four walls of the
channel”:

(Id. ¶ 304 (citing Tashiro at 210, Fig. 1(b)).)
Plaintiffs dispute whether the design discloses “focusing” of the sample, but there is
no dispute that Tashiro states the design “is quite effective to put the sample flow away
from the channel wall.” (Pls.’ Resp. to Defs.’ PFOFs (dkt. #196) ¶ 305 (citing Tashiro at
209).) While defendants point out that Tashiro also states that the design realized “lateral
and vertical sheath flow” (Defs.’ PFOFs (dkt. #161) ¶ 306 (citing Tashiro at 211)),
plaintiffs challenge whether Tashiro actually discloses this, directing the court to their
expert Dr. Vacca’s report, in which he opines that Tashiro discloses “surrounding” the
sample with sheath flow, but not “focusing.” (Pls.’ Resp. to Defs.’ PFOFs (dkt. #196)
¶ 306 (citing Vacca Rept. (dkt. #131) ¶ 77).)
3. Wada
Finally, U.S. Patent No. 6,505,609, identified by one of its inventors H. Garrett
Wada, is entitled “Focusing of Microparticles of Microfluidic Systems” and was issued

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January 14, 2003. Although issued from an application filed on May 11, 2000, the actual
claims priority date is based on a provisional application filed on May 17, 1999. (Safiullah
Aff., Ex. 8 (dkt. #166-8) (“Wada”).) Wada is directed at “[m]ethods and systems for
particle focusing to increase assay throughput in microscale systems” and “it includes
methods for providing substantially uniform flow velocity to flowing particles in
microfluidic devices.” (Defs.’ PFOFs (dkt. #161) ¶ 307 (quoting Wada, abstract).) In
particular, Figure 1A of Wada is reproduced below, which depicts particles that “‘are
typically flowed from one microchannel into the cross-junction and focused by introducing
hydrodynamic flows 102 from the two orthogonal microchannels,’ such that the sheath
fluid surrounds the particles on at least two sides”:

(Defs.’ PFOFs (dkt. #161) ¶ 310 (quoting Wada at Fig. 1A, 9:8-11).)
Importantly for present purposes, Wada further discloses other embodiments in
which the design “us[es] a series of offset focusing microchannels to achieve focusing by
serial introduction of fluids from the offset channels.” (Id. ¶ 311 (quoting Wada at 9:1317); see also id. ¶ 313 (citing Wada at 11:61-63 (describing devices and methods that “focus
and/or sort the particles”)).) Even more particularly, defendants point to embodiments

17

that purported to show “second downstream focusing microchannel[s]” as depicted below.

(Defs.’ PFOFs (dkt. #161) ¶ 314 (citing Wada at Figs. 22 and 23).) As Wada explains,
“[i]n these embodiments, cells (2200 and 2300) flow into the main channel and are
surrounded on their left and/or right by hydrodynamic flows of sheath fluid from
microchannels (2202 and 2302).” (Id. ¶ 315 (citing Wada at 13:1-10, 21-24).) “The cells
then pass through a detector (2204 and 2304) and are sorted into one of two wells (2210
and 2312) by hydrodynamic flows of sheath fluid entering from at least one of a pair or
opposing microchannels (2202 and 2302) based on the detected properties of the cells.”
(Id. ¶ 316 (citing Wada at 13:1-16, 24-31).) Finally, Wada provides that “[t]he particles
. . . are optionally focused horizontally and/or vertically in the first microchannel to provide
substantially uniform flow velocity to the particles in the first microchannel.” (Pls.’ Resp.
to Defs.’ PFOFs (dkt. #196) ¶ 317).)
In response, plaintiffs do not -- and cannot -- dispute that Wada contains the
language and figures described above. Instead, they dispute that Wada actually discloses
these methods and devices, directing the court to their expert Dr. Vacca’s report in which
he opines that Wada is not enabling. (Pls. Resp. to Defs.’ PFOFs (dkt. #196) ¶¶ 312, 314,

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316-17 (citing Vacca Rept. (dkt. #131) ¶¶ 104-111).)

D. Facts Relevant to Defendants’ Inequitable Conduct Counterclaim
Defendants assert that plaintiffs engaged in inequitable conduct by failing to
disclose four prior art references to the USPTO in their applications for the Cytonome
patents: Tashiro (discussed above), Nieuwenhuis 2001, Nieuwenhuis 2002 and Larsen.
In response to plaintiffs’ motion for summary judgment on this counterclaim, defendants
proffer several pieces of evidence supporting a finding that the named inventors, Dr.
Bunner and Dr. Gilbert, were aware of these references during the patent application
process. In particular, the inventors appear to have attended conferences in 2000, 2001
and 2002 where Tashiro and the two Nieuwenhuis papers were presented and included in
conference materials. These references were also later found in the inventors’ personal files
or, at least, in Dr. Bunner’s files. (Defs.’ Add’l PFOFs (dkt. #188) ¶¶ 45-63.) While
plaintiffs dispute aspects of these findings, there appears to be no dispute that the inventors
collectively were aware of these four prior art references. At minimum, plaintiffs do not
dispute that the inventors were both aware of Tashiro during the Cytonome patent
application process. (See, e.g., id. ¶ 63 (undisputed that Bunner and Gilbert admitted that
“they were aware of Tashiro during prosecution of the Cytonome patents”).)
In their depositions, the named inventors of the Cytonome patents explained that
they believed it was unnecessary to provide the USPTO with Tashiro. Specifically, Dr.
Bunner testified that the applicants did not provide Tashiro to the patent office because:
“it was redundant. We felt it was redundant to what Weigl was disclosing.” (Pls.’ PFOFs
(dkt. #164) ¶ 93 (quoting Bunner Dep. (dkt. #93) 229).) Similarly, Dr. Gilbert testified

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that they did not provide Tashiro because it “is a derivative of Weigl,” and Weigl is
“earlier,” “bigger” and has a “more robust discussion.” (Id.at ¶ 102 (quoting Gilbert Dep.
(dkt. #92) 304-05).) Gilbert similarly testified that it was not necessary to disclose the
Nieuwenhuis 2001 and Nieuwenhuis 2002 references because they were, in turn,
derivative of Tashiro. (Id. ¶¶ 103-104 (citing Gilbert Dep. (dkt. #92) 306-07, 367.)
In submitting the application for the Cytonome patents, Dr. Bunner declared as
follows:
I hereby state that I have reviewed and understood the
contents of the above identified specification, including the
claims, as amended by an amendment, if any, specifically
referred to herein.
(Defs.’ Add’l PFOFs (dkt. #188) ¶ 71 (quoting Mulder Decl., Ex. 10 (dkt. #189-10) 2)
(emphasis added).) At his deposition, however, Dr. Bunner acknowledged that he “rarely
review[s] the claims of patents on which I’m an author. I always review the specification
but often have not reviewed the claims.” (Pls.’ PFOFs (dkt. #164) ¶ 94 (quoting Bunner
Dep. (dkt. #93) 184).) In fairness, when questioned further, Bunner clarified that he
“cannot say that I did not read the claims,” and further stated that he “understood the
claims,” and that he stood by the affidavit submitted to the USPTO that he understood
the claims. (Id.) Brunner also testified that it was “quite likely that I understood [the
claims], but poorly,” explaining that he did not understand the “legal ramifications” of the
claims, but he understood the invention. (Id. ¶ 95, 97 (quoting Bunner Dep. (dkt. #93)
188-89, 363.)

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E. Facts Relevant to Defendant ABS’s Breach of Contract Counterclaim
Defendant ABS also asserts a breach of contract counterclaim based on plaintiff
ST’s alleged failure to deliver sexed bull semen in compliance with an agreement between
ST and ABS, dated September 1, 2012. (Moreno Decl., Ex. A (“2012 Agreement”) (dkt.
#165-1).) 5 As part of that agreement, ABS provided bull semen to ST for sorting by Xchromosome or Y-chromosome. The sorted semen would then be packaged into “straws,”
and ABS would pay ST for those straws.
The 2012 Agreement required that the sorted semen sold to ABS meet a purity
threshold. 6 The contract defines “Purity” as “the ratio of the number of sperm cells of the
requested gender to the total number of sperms cells in such straw.” (2012 Agreement
(dkt. #165-1) § 1.)

The contract also defines “Primary Gender Straws” as “straws

containing a Purity of approximately 87%, but in no event, less than 85% Primary Gender
sperm.” (Id.) Similarly, “Secondary Gender Straws” are defined as “straws containing a
Purity of approximately 87%, but in no event, less than 85% Secondary Gender sperm.”
(Id.) Section 12 of the Agreement further states: “ST warrants only the purity of the
sorted semen products and makes no warranty as to the success rate with respect to gender
at birth.” (Id. § 12 (altered all caps).)
At the time the 2012 Agreement was executed, there were multiple ways of

5

The term of the 2012 Agreement was five years and, thus, ran through August 31, 2017.

In its counterclaim, ABS originally alleged that the sexed semen straws failed to meet contractual
requirements for (1) motility, (2) concentration, and (3) purity. In its brief in opposition to ST’s
motion for summary judgment, however, ABS abandons the motility and concentration portions of
its breach of contract counterclaim, so the court will only address the purity requirement.
6

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evaluating the purity of sorted semen, including flow cytometer reanalysis and fluorescent
insitu hybridization, and it was known that different purity-measuring techniques could
produce different, even potentially conflicting, results. Nevertheless, the Agreement did
not specify which methodology should be used to determine compliance. ABS does not
dispute this fact.

However, ABS points out that purity is “expressly defined in the

agreement with reference to a matter of objective fact, i.e., ‘the ratio of the number of sperm
cells of the requested gender to the total number of sperm[] cells in such straw.’” (Defs.’
Resp. to Pls.’ PFOFs (dkt. #187) ¶ 154 (quoting 2012 Agreement (dkt. #165-1) § 1).)
ABS contends, therefore, that while there may be conflicting evidence of whether this
requirement has been satisfied, “the requirement itself concerns actual purity, which turns
on the actual cells, not on any single ‘purity-testing methodology.’” (Id.)
Regardless, ST chose “flow cytometer reanalysis” as the sole method used to
evaluate purity for the purposes of determining compliance with the purity requirement
throughout the five year life of the 2012 Agreement. ABS was also aware that ST used
flow cytometer reanalysis for its purity valuations during the course of an earlier, long-term
agreement between the parties. Moreover, at no point leading up to or during the course
of the 2012 Agreement did ABS request that ST use a different purity measurement
method. Finally, during the course of performing under the 2012 Agreement, ST routinely
provided straws of sorted semen to ABS whose purity had been determined using flow
cytometer reanalysis, and ABS routinely accepted such straws. Moreover, ABS does not
dispute that this was the sole test run in the laboratory, but contends that ST also claimed
to be comparing its results against “actual customer experience in the field.” (Id. ¶ 155.)

22

On July 6, 2017 -- over four years and ten months into the five-year term of the
2012 Agreement -- ABS sent ST a letter asserting that four batches of straws purportedly
failed to meet the 2012 Agreement’s minimum purity requirement. 7 (Moreno Decl., Ex.
B (dkt. #165-2).) ABS neither disputes that these batches had passed ST’s quality control
testing, exceeding the minimum purity requirement, nor that ST retested straws from each
of these batches in response to ABS’s letter and found that all four of the batches retested
at greater than 90% purity. Nevertheless, ABS contends that its testing revealed that the
batches fell below the contractual 85% purity requirement. Even after sending this letter,
however, ABS continued to place orders with and accept straws of sorted semen from ST.
On September 1, 2017 -- one day after the 2012 Agreement ended -- ABS sent ST
another letter alleging that additional batches of straws failed to meet the minimum purity
requirement. In total, ABS identified thirty-two batches of straws, which ABS contends
do not meet the minimum purity requirement. Of those, ABS only returned straws from
ten batches. ST retested three straws from each of those ten batches, finding that all straws
exceeded the 85% minimum purity required by the 2012 Agreement. Again, ABS does not
dispute this, but contends that according to its tests, the straws fell below the contractual
85% purity requirement.
As further context, sometime in late 2016, but within the final year of the 2012
Agreement, ABS developed and began using a different, assay-based purity measurement

The letter also stated that another six batches failed to meet the motility standard, and one batch
of straws that failed to meet the purity requirement also failed to meet the motility requirement,
but ABS is no longer claiming a breach of contract based on insufficient mobility.
7

23

method called “ddPCR.” 8 In large part, ABS relies on this testing method in claiming that
the ST straws do not meet the minimum purity requirement. 9
ABS also points to ST’s internal documents, which purport to raise concerns about
the accuracy of ST’s purity testing. Specifically, in a series of ST internal emails from May
2015, ST’s Vice President of Flow Cytometry, Mike Evans, expressed his view that “a lot”
of the purity results reported as 87% “may actually [have] been below 87 and should have
failed.” (Defs.’ Add’l PFOFs (dkt. #188) ¶ 114.) In another email, Evans reports in May
2015 that some ST labs were “typically overestimating the purity by up to 5%.” (Id. ¶
116.) ST’s head of Research and Development Vish Vishawanath also considered it
“telling” that the number of straws tested by ST employees at its lab located at ABS
identified as having “exactly 87%” purity. (Id. ¶ 115.) In an August 2015 internal email,
ST’s Thom Gilligan raised similar concerns about ST employees’ overestimating purity,
“especially since the employees have an incentive not to fail on purity.” (Id. ¶ 120.) In
November 2015, ST generated an internal “Purity Assessment Audit,” which described
some concerns, including “[l]abs did not have a good handle on proper purity assessment
with some labs fudging to pass.” (Id. ¶ 123.) A September 2016 email from an ST
researcher, Dr. Leo Britto, attached a “Purity Analysis Review,” showing that 25% of the
purity analysis images at the ABS Deforest facility were “unsatisfactory” in June 2016. (Id.

While there appears to be a wider or more general application of this protocol, ABS acknowledged
that its use of this term refers to a “specific application of the ddPCR technology as a qualitative
control measure.” (Pls.’ Reply to Pls.’ PFOFs (dkt. #214) ¶ 183.)
8

ABS submits several facts about the reasons why it conducted its own testing in May or June
2017, which seems only tangentially related to the claim and the present motion. Thus, the court
has not included these facts.
9

24

¶ 127.)
Despite ABS’s claimed concerns about purity, it admits that ST straws from the
alleged non-compliant batch were sold “in the normal course” of business” and that “no
special discounts were given.” (Pls.’ PFOFs (dkt. #163) ¶ 192.) At the same time, there
is no dispute that ST offers its customers lower-purity sexed semen for a lower price. Under
at least one contract with a major U.S. bull stud, ST charged a bull stud $4 less per straw
for at least 75%-pure sexed semen than for 85%-pure sexed semen.

OPINION
I. Defendants’ Motion for Summary Judgment and Claims Construction
A. Claims Construction 10
1. “Direction” terms
As quoted above, the four Cytonome patents all contain claims involving a two-step
process: (1) focusing (or injecting or adjusting) sheath fluid “in at least a first direction,”
and (2) focusing (or injecting or adjusting) sheath fluid “in at least a second direction
different from the first direction.” The parties dispute whether the second focusing may
be in a direction that overlaps with one of the directions of the first step. Defendants
maintain that the focusing at the second step may not be in any of the same directions as
that in the first step. In other words, if at the first step, the sample was focused from the
right, from the left and from the bottom, the second step may not include focusing from
the right, from the left or from the bottom. On the other hand, plaintiffs contend that

10

The court adopts the same standard as described in its prior opinion and order.

25

focusing can happen in the same direction in both steps, so long as at least one of the
directions is different. In other words, the direction of focusing may not be exactly the
same at each step. For example, if at the first step, the sample was focused from the right,
from the left and from the bottom, the focusing at the second step could again be from the
right, from the left and from the bottom, provided it also came from the top as well.
Both sides claim that the embodiments support their respective positions.
Defendants relies on the text describing the preferred embodiments. Specifically, the text
describes an embodiment at the “primary focusing region,” which “focuses the sheath fluid
away from the sides and bottom of the sample,” and at the “secondary focusing region,”
which “focuses the sample in a vertical direction from above the sample.” (’476 patent at
4:63-5:7.) Another embodiment similarly describes “[i]n the primary focusing region 17,
the sample particles injected into the sheath flow are focused away from the sides and
bottom of the sheath flow,” whereas in the “secondary focusing region 19,” sheath fluid is
introduced “compressing the suspended sample away from the upper wall of the channel
12 (i.e., in the other direction from the main sheath of fluid around the particle).” (Id. at
6:9-11, 50-57.) So, too, in another embodiment, the sample in the primary focusing region
“is focused on three sides by accelerating sheath fluid,” and sheath fluid enters the “second
focusing region 19 to focus the suspended particles on the fourth side.” (Id. at 7:55-63.)
In all of the descriptions of the embodiments, there is no overlap in the direction or
directions at the first step and in the direction or directions at the second step.
Given that each of the embodiments contain no overlap in directions at the two
focusing steps, plaintiffs understandably choose not to address the language of the patents’

26

embodiments.

Instead, they contend that the figures in the specifications themselves

support their position that the claim contemplates some overlap in directions at the two
steps. In particular, plaintiffs contend that each of the figures shows “tapering” at both
the primary and secondary focusing regions, and, therefore, the patents’ preferred
embodiment as depicted in the figures disclose focusing on both the left and right sides at
both steps.

Moreover, because defendants’ construction would exclude each of these

figures, plaintiffs argue it cannot be correct. See Kaneka Corp. v. Xiamen Kingdomway Gro.
Co., 790 F.3d 1291, 1304 (Fed. Cir. 2015) (“A claim construction that excludes a preferred
embodiment is rarely, if ever, correct.

A construction that excludes all disclosed

embodiments . . . is especially disfavored.”) (internal citations and quotations omitted).
In making this argument, however, plaintiffs rely on “tapering” visible in the various
figures to argue that both steps or focusing regions -- depicted as 17 and 19 in the figure
below -- disclose focusing on both sides:

(’476 patent at Fig. 2A.) As depicted, the primary focusing region at 17, shows tapering

27

of the sheath flow channel. In other words, the channel “tapers from a relatively wide
width W at the outlets . . . to a small width W,” as does the secondary focusing region at
19. Defendants do no dispute that Figure 2A ostensibly shows tapering at both focusing
regions, but contend that Figure 4A -- depicted in the fact section above -- does not show
tapering at the second focusing region.
However, the reliance on “tapering” alone is a bit of red herring since tapering is
not the same as focusing, at least as used in the context of these patents. Instead, while
the specification describes how tapering may facilitate focusing (see, e.g., ’476 patent at
6:17-21), it primarily describes the injection or insertion of sheath fluid as focusing the
sample. (See, e.g., id. at 6:9-11 (“the sample particles injected into the sheath flow are
focused away from the sides and bottom by the sheath flow” (emphasis added)); id. at 6:2729 (“the secondary focusing region 19 utilizes sheath fluid to provide secondary focusing of
the sheath flow” (emphasis added)); id. at 7:55-58 (sample “is focused on three sides by
accelerating sheath fluid” (emphasis added); id. at 7:50-53 (“[a]dditional sheath fluid 130
enters the primary sheath flow channel 12 through a connector in the secondary focusing
region 19 to focus the suspended particles on the fourth side” (emphasis added)).)
Most critically, in the description of the figures, the specification does not describe
focusing on the sides at the secondary focusing region even though the figure shows
tapering. Rather, as quoted above, the specification describes focusing from above or top
or fourth side in the secondary focusing region of each embodiment. Although both sides
primarily rely on the specification to support their respective claims construction positions,
therefore, the court: (1) agrees with defendants that the text of the specification supports

28

a construction requiring no overlap in directions in the focusing (or injecting or adjusting)
of sheath fluid in the two steps; and (2) disagrees with plaintiffs that the patents’ figures
support (much less require) a different construction.
2. “Focusing” terms
The ’476, ’309, and ’161 patents all contain the term “focusing,” “focuses” or
“focus” in various claims. Defendants contend that the term means “narrowing, pinching,
or otherwise confining the particle stream with the sheath fluid.” (Defs.’ Opening Br. (dkt.
#62) 58.) Plaintiffs maintain that the term includes additional limitations. Indeed, in an
apparent effort to avoid an invalidity challenge, plaintiffs offer the following, cumbersome
definition for this seemingly straightforward verb:
Accelerating sheath fluid to exert a force on the particles, which
narrows and aligns the particle stream in a desired direction
relative to the boundaries of the channel, while achieving or
maintaining laminar flow. Merely introducing a sample fluid
at a particular position in a straight flow passage does not
constitute focusing.
(Id.)
In large part, the stark contrast in the parties’ dispute turns on whether the
Cytonome patent applicants made a disavowal of the broader definition proposed by
defendants in the prosecution of the patents. Prosecution disclaimer is a doctrine that
prevents “patentees from recapturing through claim interpretation specific meanings
disclaimed during prosecution.” Mass. Inst. of Tech. v. Shire Pharms., Inc., 839 F.3d 1111, 1119
(Fed. Cir. 2016) (quoting Omega Eng’g, Inc. v. Raytek Corp., 334 F.3d 1314, 1323 (Fed. Cir.

2003)). However, the doctrine only applies where the patentees’ disavowal is “both clear

29

and unmistakable.” Id. (quoting 3M Innovative Props. Co. v. Tredegar Corp., 725 F.3d 1315,
1325 (Fed. Cir. 2013)). Anything short of “clear and unmistakable,” which must be proved
by the party attempting to invoke prosecution disclaimer, does not warrant application of
the doctrine. Id.
During the prosecution of the Cytonome patents, the applicants responded to a
non-final office action rejecting certain claims based on the “Ohki reference” -- U.S. Patent
No. 4,983,038. In particular, the applicants distinguished how the Ohki reference from
the patented invention as follows:
Even if the sample fluid flow passage 10 and the opening 12
can be considered to position the same fluid at a certain
location of the capillary flow passage 6 of the ju[n]ction 11 of
the two flow passages 5, the opening 12 does not focus sheath
fluid around a particle, because a particle has not yet been
injected in the sheath fluid when it passes through the opening
12 and/or the projections 18 in the system of Ohki. Focusing
of a particle in sheath fluid requires acceleration and removal
of sheath fluid from around a particle, which does not occur
from the mere injection of a sample fluid in a flow passage.
Rather, the opening 12 and projections 18 of Ohki merely
position a sample fluid at a particular location within a
capillary flow passage, without performing focusing of sheath
fluid around a particle.
(Mulder Decl., Ex. 10 (dkt. #159-10) 12 (italics in original; underlying added for
emphasis).)
Defendants argue that this language is not a “clear disavowal” under applicable law.
Instead, defendants contend this passage is describing a prior art reference, rather than the
patented invention. However, statements about a prior art reference can still constitute a
disclaimer, at least when made in an effort to distinguish the prior art reference from the
patented invention. See Am. Piledriving Equip., Inc. v. Geoquip, Inc., 637 F.3d 1324, 1336

30

(Fed. Cir. 2011) (The Federal Circuit has “made clear . . . [that] an applicant’s argument
that a prior art reference is distinguishable on a particular ground can serve as a disclaimer
of claim scope even if the applicant distinguishes the reference on other grounds as well.”).
Defendants also argue that the thrust of this passage concerns the applicant’s effort to
clarify or correct the examiner’s understanding of the Ohki invention.

Specifically,

defendants argue that the applicant clarifies that in Ohki the sample has not yet been
injected and, therefore, there is no focusing at component 10. Fair enough. The court
agrees that the above paragraph -- along with the two paragraphs surrounding it -- primarily
concerns the placement of the focusing region vis-à-vis the sample injection site. But the
passage also contains an unambiguous statement of what focusing is -- “acceleration and
removal from around a particle” -- and more importantly, what focusing is not -- “mere
injection of a sample fluid in a flow passage.”
Plaintiffs also point to the PTAB’s finding of this same prosecution disclaimer as
part of the inter partes review. Specifically, PTAB decided that “merely introducing a
sample fluid at a particular position in a straight flow passage does not constitute focusing
because focusing required acceleration of the sheath fluid.” (Pls.’ Add’l PFOFs (dkt. #197)
¶ 73.) Neither party, however, directs the court to any case law describing what, if any,
deference this court should give to this preliminary decision. Indeed, without the benefit
of the full record before this court, including a named inventor’s deposition testimony that
“focusing” does not include the limitations plaintiffs now seek, there is little basis for
placing weight on the PTAB’s finding, either way. Still, the court independently comes to
the same conclusion because the statement quoted above does constitute a disclaimer in

31

the prosecution of Cytonome patents, whether the inventors intended it or not.

In

particular, the patent application defined focusing in the invention as requiring
“acceleration” and disclaimed “mere injection of a sample fluid in a flow passage” as
focusing. 11
In fairness, defendants persuasively point to portions of the specification, which
treats acceleration as distinct from focusing. (Defs.’ Opening Br. (dkt. #162) 62.) Absent
a disclaimer, this argument would be compelling, but a prosecutorial disclaimer trumps
other language in the specification. Uship Intellectual Properties, LLC v. United States, 714
F.3d 1311, 1316 (Fed. Cir. 2013) (“Even if the specification had disclosed an embodiment
where a human performed the entirety of the validation step, prosecution disclaimer could
result in that embodiment not being covered by the claims.”). In other words, the patent
applicant limited the term “focusing” to requiring acceleration.
Of course, plaintiffs’ proposed construction extends well beyond the purported
disclaimer to include limitations about aligning and acceleration itself.

The court is

unpersuaded that the definition of “focusing” should include any additional limitation.
Certainly, plaintiffs have failed to explain why the definition should extend beyond the
language of the disclaimer. Moreover, at the hearing, plaintiffs were primarily concerned

The quoted passage also contains language that focusing requires “removal of sheath fluid from
around a particle.” In their response, plaintiffs abandon their experts’ attempt to rewrite the
language of the disclaimer, and instead offer a plain reading: “removal of sheath fluid from around
the particle” occurs “as the sheath fluid accelerates and ‘stretches.’” (Pls.’ Opp’n (dkt. #191) 44.)
In their reply brief, defendants chose not to dispute this reading. Regardless, the court rejects
defendants’ argument that this part of the disclaimer is unclear, although it appears redundant of
the “narrowing, pinching or confining” language in the construction. Moreover, neither party is
arguing that the “removal” language is material to the construction of focusing.

11

32

about the inclusion of the “mere injection” language in the construction.
As such, the court will construe “focusing” to mean “narrowing, pinching or
confining the particle stream or sample fluid with the sheath fluid, causing acceleration of
the sheath flow. However, mere injection of a sample fluid in a flow passage does not
constitute focusing.” In adopting the latter disclaimer, the court clarifies that the “mere
injection” disclaimer does not mean that focusing cannot incur at the spot where a sample
is injected into a sheath flow, but rather that it would not satisfy focusing for purposes of
the Cytonome patents. In other words, focusing may well occur at the sample injection
spot, assuming there is either a structural basis for focusing, e.g., a taper or a ramp, or the
sample fluid is injected into sheath fluid moving at a rate that creates focusing.
3. ‘912 patent preamble
The parties next dispute whether the preamble of the ’912 patent is limiting.
“Generally, the preamble does not limit the claims.” Georgetown Rail Equip. Co. v. Holland
L.P., 867 F.3d 1229, 1236 (Fed. Cir. 2017) (citation omitted). The preamble “is not a
claim limitation if the claim body defines a structurally complete invention . . . and uses
the preamble only to state a purpose or intended use for the invention.” Id. (internal
quotation marks and citation omitted).
Here, each of the independent claims begin with the language: “A flow structure for
suspending a particle in a sheath fluid, comprising . . . .” (See, e.g., ’912 patent at 11:2122.) Defendants contend that this language is not limiting because the claims themselves
go on to define a “structurally complete invention.” (Defs.’ Opening Br. (dkt. #162) 69.)
In this context, defendants argue, the preamble language simply describes the purpose or

33

intended use of the invention. Plaintiffs respond that the preamble is limiting by its terms,
and they seek a construction that limits the invention to “a flow structure for placing a
particle in a smooth laminar sheath fluid flow, comprising” the claim elements. (Pls.’
Opp’n (dkt. #191) 56.) Specifically, plaintiffs argue that the preamble is necessary because
the other limitations in the claims do not mention the word “particle.” “A structure that
injects ‘sheath fluid’ into a channel that contains no particles serves no purpose and is
inconsistent with every embodiment provided in the Cytonome Patent specifications.”
(Id.)
As explained in the court’s preliminary pretrial conference order on patent cases,
parties are required to “show that construction is material to a disputed issue of
infringement or invalidity.” (Prelim. Pretrial Conf. Order (dkt. #53) ¶ 7.) Here, the parties
have failed to make such a showing. As such, the court declines, at this time at least, to
construe the preamble.

Moreover, the PTAB’s recent finding that the each of the

challenged claims of the ’912 is unpatentable (dkt. #275-1) and the court’s finding below
of non-infringement moots any need to construe the preamble.
4. “primary focusing region”
Next, defendants seek a construction of “primary focusing region” in all asserted
claims of the ’476 patent. Defendants contend that the term means “the first focusing
region downstream of the sample inlet.” (Defs.’ Opening Br. (dkt. #162) 71.) In contrast,
plaintiffs contend that the term simply means “a first focusing region.” (Id. (emphasis
added).) In other words, plaintiffs construe the term so that the meaning of “primary” is
relative to the “secondary focusing region,” but does not impose a limit as the relationship

34

to any other focusing regions, accordingly a “primary focusing region” could come after
another focusing region so long as it precedes the “secondary focusing region.” (Pls.’ Opp’n
(dkt. #191) 64.)12
In support of their more limited construction, defendants point to language in the
claims themselves describing the primary focusing region as “extending downstream of the
sample injection site.” (’476 patent at claim 1.) Defendants also point to language in the
specification that describes the “primarily focusing region” as “in the vicinity of a sample
channel connected to the sample inlet.” (Id. at 2:1-2.) While this language would appear
to be further support for finding that the sample injection site (or inlet) cannot be a
focusing region, neither the claim language nor the specification provide support for
requiring a further limitation that the “primary focusing region” be the first focusing region
after the sample inlet. Instead, the plain language of the claim and the use of “primary”
and “secondary” indicates that there must be a first focusing region preceding a second
focusing region. Accordingly, the court will adopt plaintiff’s construction that “primary
focusing region” simply means “a first focusing region” relative to a “secondary focusing
region.”
5. “primary flow channel”
Finally, defendants seek construction of the term “primary flow channel” in all

Plaintiffs further respond that the construction does not matter because a number of their
infringement theories rest on Detail B being deemed the primary focusing region, which the parties
agree is also the first focusing region. For the reasons explained below, however, any infringement
theory resting on Detail B fails as a matter of law in light of the court’s construction of the direction
terms. As such, this construction is material to plaintiffs’ claims of infringement.

12

35

asserted claims of the ’161 and ’912 patents. In what becomes a fairly rambling argument,
defendants maintain that this term is indefinite because plaintiffs’ expert, Dr. Vacca,
presumably one skilled in the art, treats “primary flow channel” and “primary sheath flow
channel” differently, even though the specification uses the “two terms interchangeably to
refer to the same elements of the disclosed embodiments.” (Defs.’ Opening Br. (dkt. #162)
74.) In other words, defendants do not argue so much that the claims “fail to inform, with
reasonable certainty, those skilled in the art about the scope of the invention” Nautilus,
Inc. v. Biosig Instruments, Inc., 572 U.S. 898, 901 (2014), but rather that plaintiffs’ expert
is misusing it. Indeed, defendants contend that the meaning of “primarily flow channel”
or “primarily sheath flow channel” is clear from the specification, and may be used
interchangeably, highlighting in their brief that portion of the embodiment in Figure 2A
shown below:

(Defs.’ Opening Br. (dkt. #162) 74 (citing ’161 patent at Fig. 2A).)
As such, this is not a proper claims construction request. Defendants are simply
challenging Vacca’s infringement opinion, which, if relevant at trial, they are welcome to
pursue. The court declines to construe this term, however, at least at this time.

36

B. Noninfringement
As described above in the facts section, there are two alleged infringing products:
GSS and single sheath chip. Plaintiffs pursue four infringement theories, across the four
patents, all of which are based on the location of the primarily focusing region and
secondary focusing region in each product: (1) for GSS, Detail B as the primary focusing
region and an Detail C as the secondary focusing region; (2) for GSS, Detail B as the
primary focusing region and Detail D as the secondary focusing region, (or for the single
sheath chip, Detail B as the primary focusing region and Detail C as the secondary focusing
region); (3) for GSS, Detail C as the primary focusing region and Detail D as the secondary
focusing region; (4) for GSS, Detail D as containing both the primary focusing region (the
ramp) and the secondary focusing region (the taper) (or for single sheath, Detail C
containing both the primary and secondary focusing regions -- the ramp and the taper as
separate regions). 13

For the ’161 and ’912 patents, however, plaintiffs’ theory of

infringement is limited to the first theory and only concerns the GSS technology.
1. Infringement Theories Based on Detail B as the Primary Focusing Region
For both products at Detail B, there appears to be no dispute that the sample is
focused away from all four walls, or focused “radially inward.” As a result, were Detail B
to be deemed the primary focusing region, then focusing in the secondary focusing region
would necessarily overlap, thus dooming plaintiffs’ first two theories of infringement.

Consistent with the parties’ arguments, the court primarily uses the claim language of the ’476
patent, recognizing that the claims in the other patents may use slightly different language in
requiring discuss this primary region or first step. For this reason, the court’s discussion of the
infringement theories applies generally to all four Cytonome patents.

13

37

Plaintiffs nevertheless argue that there is a factual dispute as to whether radially inward is
the same as focusing away from all four walls, but this is not a factual dispute that would
warrant jury consideration. At most, it is a semantics issue best left for the court to decide;
at least, it is a silly argument. Regardless, the court finds that for purposes of the Cytonome
patents, focusing radially inward is the same as focusing away from all four of the outer
walls. As such, any infringement theory premised on Detail B as the primary focusing
region (’476 patent), primary adjustment region (’161 patent), first step (’309 patent), or
first sheath fluid introduction region (’912 patent) fails as a matter of law under the court’s
construction of the “direction” terms. 14
2. Infringement Theories Based on Detail C as the Primary Focusing
Region and Detail D as the Secondary Focusing Region (’476 and ’309
patents)
As for the ’476 and ’309 patents, plaintiffs assert a third infringement theory as to
the GSS technology where Detail C is the primary focusing region and Detail D is the
secondary focusing region. As explained in the facts section above, there is no dispute that
at Detail C, sheath fluid is focused from above (also described as away from the top wall)
to position the sample in the center of the flow for detection. The parties, however, dispute
the directions at play in Detail D. Plaintiffs contend that the taper focuses from the left
and right sides and the ramp focuses from the bottom only, meaning that there would be
no overlap in directions between Detail C and Detail D (considering the ramp and taper

In light of this finding, the court also need not consider defendants’ motion for noninfringement
of dependent claim 18 of the ’912 patent because the accused infringing technology does not satisfy
the “substantially aligned” limitation.

14

38

collectively or as separate regions or steps). Defendants contend, however, that plaintiffs’
own expert conceded that Detail D’s ramp also focuses from the top. If so, the directions
of Detail D (all four sides) would obviously overlap with the direction of Detail C (from
the top).
As support, defendants point to Dr. Vacca’s invalidity report, which discusses a
ramp in the Weigl prior art reference and opines that the vertical ramp would squeeze the
sheath fluid and sample “from the top and bottom.” (Vacca Rebuttal Validity Rept. (dkt.
#131) ¶ 213.) In his infringement report, discussing the alleged infringing technology,
Vacca, however, consistently opined that the ramp in Detail D of the GSS chip solely
focused from the bottom. (Vacca Infringement Rept. (dkt. #130) ¶¶ 143, 600; Vacca
Suppl. Infringement Rept. (dkt. #144) ¶ 9.) Certainly, this appears to be a rich area for
cross-examination: why would the ramp in Weigl function differently than the ramp in
the accused infringing technology? However, plaintiffs have still done enough to create a
material issue of disputed fact as to the directions implicated in Detail D. Because a
reasonable fact finder could conclude that there is no overlap in the directions at Detail C
and Detail D, the court will deny summary judgment to defendants as to this infringement
theory under the court’s construction of the direction terms.
In addition, defendants seek summary judgment on the basis that Detail C cannot
be the primary focusing region because it is not the first focusing region after the sample
insertion site, Detail B is. For the reasons explained above, however, the court already
rejected defendants’ narrow construction of “primary focusing region.” Therefore, this
basis for summary judgment fails as a matter of law.

39

Accordingly, the court will deny defendants’ motion as to the infringement theory
for the GSS chips based on: (1) Detail C as the primary focusing region of the ’476 patent
or first step of the ’309 patent; and (2) Detail D as the secondary focusing region of the
’476 patent or second step of the ’309 patent.
3. Infringement Theories Based on Detail D for GSS and Detail C for
Single Sheath as Both the Primary and Secondary Focusing Regions (’476
patent)
Plaintiffs’ fourth theory of infringement, limited to the ’476 and ’309 patents,
concerns Detail D for the GSS technology and Detail C for the single sheath chip. 15 Under
this theory, the ramp is the primary focusing region or first step, and the taper is the
secondary focusing region or second step. As described above, the ramp focuses from the
bottom (and the top, according to defendants), while the taper focuses from the sides.
Accordingly, this theory meets the directional limitation under either parties’ views.
Defendants nevertheless makes a superficial, one paragraph argument that summary
judgment is warranted as to the ’476 patent because Detail D cannot constitute two
separate “regions as a matter of law,” apparently conceding for purposes of summary
judgment that Detail D can contain two separate “steps.” (Defs.’ Reply (dkt. #217) 74.)
Defendants make no attempt to explain why this is so, whether as a matter of law or fact.
Indeed, defendants do not even seek a construction of the word “regions” at all, much less
one that draws a meaningful distinction between “regions” and “steps” as used in the ‘476

For the reasons explained above, this theory fails as a matter of law for the ’912 patent given that
there is no injecting of sheath fluid at Detail D for the GSS technology or Detail C for the single
sheath chip.
15

40

and ‘309 patents, respectively, and certainly not a construction that would foreclose a finding
by the jury that Detail D’s ramp is located in a separate region from its taper. Even if
defendants had sought a construction of “region,” Figure 1 of the Cytonome patent
specification (depicted above in the fact section), describes two focusing regions, the
primary at 17 and the secondary at 19, with no apparent demarcation between the two
along the same narrowing channel. (’476 patent at Fig. 1.) Accordingly, whether someone
skilled in the art would understand that Detail D contains two focusing regions or steps
for purposes of infringement of the asserted claims of the ’476 and ‘309 patents is a factual
issue to be resolved by the jury. Accordingly, the court will deny this basis for summary
judgment.
4. Tapering
Defendants also seek a finding of noninfringement of claims 5, 27 and 28 of the
‘476 patent, all of which concern focusing regions formed by “tapering” the primary sheath
flow channel. 16 For example, claim 5 provides, “The sheath flow channel of claim 1,
wherein the primary focusing region is formed by tapering the primary sheath flow channel
in a direction along which fluid flows therethrough,” which results in fluid acceleration as
a basic principal of laminar flow. (’476 patent at claim 5.)
Defendants contend that the area plaintiffs identify as a taper in the alleged

Defendants also move on dependent claim 21. That claim, however, does not mention
“tapering.” Instead, it concerns the placement of the sample inlet vis-à-vis the primary sheath flow
channel. While claim 21 does refer to the sample inlet “intersect[ing] a relatively wide portion of
the primary sheath flow channel,” defendants’ arguments about “tapering” is too far afield to apply
to this limitation.
16

41

infringing technology is simply where “two subchannels of the primary sheath flow channel
come together,” as depicted in green below in an image from plaintiffs’ expert report:

(Defs.’ Opening Br. (dkt. #162) 193 (citing Vacca Rept. (dkt. #130) ¶ 135).) Defendants
then argue that the area marked in purple is the primary sheath flow channel downstream
of the primary focusing region, where there is no tapering, because the walls are parallel.
Therefore, defendants contend, there is no change in this region from a relatively wide
width to a smaller width, as the patent defines tapering. (Id.; see also Defs.’ Reply (dkt.
#217) 77-78.)
However, defendants offer no justification for concentrating on the parallel lines of
the purple area alone, much less why it is material. Nor can the court discern why it is
material whether the lines of the flow channel downstream of the focusing area are parallel,
and therefore do not taper, if focusing is satisfied in the green area just above. In other
words, claim 5 and the other claims concern forming focusing regions by tapering. Here,

42

according to the depiction above, the primary focusing region, shown in green, narrows
from a relatively wide width to a smaller width, or at least a reasonable jury could so fine.
The fact that two subchannels come together in this area does not foreclose a finding by a
reasonable jury that this area was formed by tapering. Accordingly, the court will deny
this basis for summary judgment.

C. Invalidity Due to Anticipation
In challenging the validity of the Cytonome patents based on three prior art
references -- Weigl, Tashiro and Wada -- defendants offer an astonishing 700 proposed
finding of facts specific to these three prior art references, marching through each asserted
claim of the Cytonome patents, virtually all of which plaintiffs purport to dispute. Rather
than trying to reconcile such a staggering number of disputed facts, much less scientific
propositions, the court will limit its analysis to whether these three prior art references
disclose “focusing” as previously construed. 17
To demonstrate anticipation, “the proponent must show ‘that the four corners of a
single, prior art document describe every element of the claimed invention.’” Net MoneyIN,
Inc. v. VeriSign, Inc., 545 F.3d 1359, 1369 (Fed. Cir. 2008) (quoting Xerox Corp. v. 3Com
Corp., 458 F.3d 1310, 1322 (Fed. Cir. 2006)). “Because the hallmark of anticipation is

The court recognizes that anticipation challenges to the ’912 patent, which involves “injecting”
sheath fluid, and to the independent claims of the ’161 patent, which involve “adjusting” sheath
fluid, may present easier questions. While the motions for summary judgment were under
advisement, PTAB issued decisions finding the asserted claims of the ’912 patent unpatentable,
and some of the asserted claims of the ’161 patent unpatentable. (Dkt. ##275-1, 277-1.) In
motions in limine, the parties should brief the import of these decisions on any anticipation or
obviousness challenges as to those two patents.

17

43

prior invention, the prior art reference . . . must also disclose those elements ‘arranged as
in the claim.’” Id. (quoting Connell v. Sears, Roebuck & Co., 722 F.2d 1542, 1548 (Fed. Cir.
1983)). This means that the prior art must detail all the limitations “arranged or combined
in the same way as in the claim.” Id. at 1370. Thus, “it is not enough that the prior art
reference discloses part of the claimed invention, which an ordinary artisan might
supplement to make the whole, or that it includes multiple, distinct teachings that the
artisan might somehow combine to achieve the claimed invention.” Id. at 1371.
As defendants emphasize, “[h]owever, a reference can anticipate a claim even if it
d[oes] not expressly spell out all the limitations arranged or combined as in the claim, if a
person of skill in the art, reading the reference, would at once envisage the claimed
arrangement or combination.” Blue Calypso, LLC v. Groupon, Inc., 815 F.3d. 1331, 1341
(Fed. Cir. 2016) (first alteration added) (internal citations and quotation marks omitted);
id. at 1344 (“[A] reference may still anticipate if that reference teaches that the disclosed
components or functionalities may be combined and one of skill in the art would be able
to implement the combination.” (internal citations omitted)); see also Purdue Pharma L.P.
v. Epic Pharma, LLC, 811 F.3d 1345, 1351 (Fed. Cir. 2016) (“A single prior art reference
may anticipate without disclosing a feature of the claimed invention if such feature is
necessarily present, or inherent, in that reference.” (internal citation omitted)).
Although anticipation is ultimately a question of fact, “it may be decided on
summary judgment if the record reveals no genuine dispute of material fact.” Leggett &
Platt, Inc. v. VUTEk, Inc., 537 F.3d 1349, 1352 (Fed. Cir. 2008) (quoting Golden Bridge
Tech., Inc. v. Nokia, Inc., 527 F.3d 1318, 1321 (Fed. Cir. 2008)). Still, “[e]vidence of

44

invalidity must be clear as well as convincing.” Schumer v. Laboratory Computer Sys., Inc.,
308 F.3d 1304, 1315 (Fed. Cir. 2002).

As such, “[t]ypically, testimony concerning

anticipation must be testimony from one skilled in the art and must identify each claim
element, state the witnesses’ interpretation of the claim element, and explain in detail how
each claim element is disclosed in the prior art reference.” Id. Conclusory statements by
experts (or attorneys) are insufficient. See id. at 1315-16.
1. Weigl
Defendants contend that Weigl discloses focusing in a primary focusing region.
Specifically, through their expert Dr. Di Carlo’s testimony, defendants argue that Weigl
discloses a “first focusing region extended downstream from the sample injection site that
can serve as a ‘primary focusing region,’ as highlighted in the annotated Figure 5B below:”

(Defs.’ Opening Br. (dkt. #162) 119 (citing Di Carlo Rept. (dkt. #129) ¶ 350; Weigl at
Fig. 5B).) Defendants contend that the sample injected at 21b is “surrounded horizontally,
i.e., on both sides by the sheath fluid from the first inlet,” and, therefore “[t]his focuses
the particles away from the left and right sides of the flow channel.” (Id. (citing Di Carlo
Rept. (dkt. #129) ¶ 351).) 18

Di Carlo also opines that there is focusing from the top wall as well because the sample enters
from the bottom of the channel. (Defs.’ Opening Br. (dkt. #162) 119 (citing Di Carlo Rept. (dkt.
#129) ¶ 352.)
18

45

Relying on their expert Dr. Vacca, plaintiffs respond that there is no focusing at this
junction, because the sample is merely being injected into the sheath flow, which was
disclaimed as previously explained. (Pls.’ Opp’n (dkt. #191) 89.) At least facially, this
argument has a certain logical appeal. Said another way, because this area lacks a structural
change, e.g., a ramp or a taper, or injection of additional sheath fluid, there is no focusing.
Indeed, the highlighted portion of the Weigl invention identified by defendants as the
primary focusing region or first focusing step, resembles the following image reproduced
from Vacca’s Rebuttal Report, showing a sample injection which is not focused:

(Vacca Rebuttal Rept. (dkt. #131) ¶ 152.) In contrast, Vacca opines that the inclusion of
either a taper or ramp or of additional sheath fluid at the sample insertion point would
satisfy the focusing requirement, as depicted in the two images below:

46

(Id. ¶¶ 149, 152.)
In their reply brief, therefore, defendants point the court to the excerpt from Weigl’s
specification that provides:
In FIG. 4B, the upstream portion (25a) is connected to the
downstream portion (27a) via the tapered portion (26a). In
this embodiment the second inlet is positioned in the upstream
portion. It can alternatively be in the tapered portion. It is
preferable to position the second inlet in the upstream portion
because this allows for greater and more precise horizontal
hydrodynamic focusing.
(Weigl at 9:67-10:6.) 19 If the sample inlet was placed in the taper -- depicted in the image
above at 26b -- then it appears that there would be focusing. Indeed, the tapering would
appear to match the image in Vacca’s Case 5’, showing a sample injection and focusing
because of the placement of a taper/ramp. Arguably, Weigl could then be read to disclose
a primary focusing area at (or immediately after) the second inlet, where the sample is
inserted.

Di Carlo also mentions this in his rebuttal report, albeit in passing. (Di Carlo Rebuttal Rept.
(dkt. #129) ¶ 478.)

19

47

Defendants rely on a second sheath fluid inlet injunction (41), which provides for
sheath fluid entering from below, to argue that the sheath flow is then focused from a
second direction. Alternatively, defendants contend that Weigl also discloses a vertical
tapering region (which the Cytonome patents would refer to as a ramp) downstream of
sheath fluid inlet (41) that can also constitute a secondary focusing area, as depicted in a
side image of Figure 5A below:

(Defs.’ Opening Br. (dkt. #162) 123 (citing Di Carlo Rept. (dkt. #129) ¶ 357); Weigl at
Fig. 5A).) Both the insertion of additional sheath fluid from the bottom and the ramp
could provide focusing, as Vacca appears to concede in his report. (Vacca Rebuttal Rept.
(dkt. #131) ¶ 145 (Case 2b, depicting focusing caused by insertion of sheath fluid from
above); id. ¶ 153 (Case 1a, depicting focusing cause by a taper or ramp).)
As described above, therefore, there is a solid argument that Weigl discloses two
focusing areas or steps, but for the fact that: (1) defendants failed to develop fully a theory
relying on the taper at the sample inlet to provide focusing at the primary focusing area or
first step; and (2) Weigl does not depict this configuration in the same embodiment as that
disclosing a third inlet (41), where additional sheath fluid is injected from below (or where
there is a vertical ramp similarly providing focusing from below).

Both of these

qualifications preclude the court from deciding as a matter of fact on this record that Weigl
disclosed the elements of the claim, at least “arranged as in the claim.” Net MoneyIN, 545

48

F.3d at 1369 (internal citations and quotation marks omitted). While this anticipation
claim may nevertheless succeed at trial -- and, indeed, the court would at least entertain a
motion for directed verdict at the appropriate time -- there remain material disputed issues
of fact that preclude summary judgment in defendants’ favor at this time.
2. Tashiro
Both sides move for summary judgment on defendants’ anticipation counterclaim
based on Tashiro. Defendants contend that Tashiro discloses “focusing the carrier flow
around the left, right, and top of the particles in the sample flow where the first carrier flow
meets the sample flow,” as depicted in blue below:

(Defs.’ Opening Br. (dkt. #162) 160 (citing Di Carlo Rept. (dkt. #129) ¶¶ 697); Defs.’
Reply (dkt. #217) 95.) 20
As plaintiffs initially point out, however, Tashiro does not mention “focusing” at

Defendants contend that Tashiro’s secondary focusing area is at the second carrier inlet, where
additional sheath fluid is inserted from the bottom. Plaintiffs principally argue that this cannot be
the secondary focusing area because there is no primary focusing area. Still, it appears that the area
identified as the secondary focusing region would satisfy plaintiffs’ expert Dr. Vacca’s depiction of
focusing in Case 4, showing additional focusing by injection of sheath fluid. (Vacca Rebuttal Rept.
(dkt. #131) ¶ 148.)

20

49

all, unlike Weigl and Wada. More fundamentally, at the location identified by defendants as
the primary focusing area or the first step, plaintiffs argue that Tashiro simply discloses
injecting or inserting a sample into a sheath flow.

Indeed, relying again on Vacca’s

depictions, Tashiro appears to disclose Case 3a, a sample injection which does not involve
focusing:

(Vacca Rebuttal Rept. (dkt. #131) ¶ 146.)
Defendants counter that plaintiffs’ description of Tashiro would foreclose a finding
of focusing in the Cytonome patents themselves: “The primary focusing region of Tashiro
identified by Defendants is no more ‘merely introducing a sample fluid at a particular
position [in] a straight flow passage’ than the devices in the Cytonome patents.” (Defs.’
Reply. (dkt. #217) 96.) However, under the court’s construction of “focusing” in the
asserted claims of the Cytonome patents, and specifically the court’s finding of a
prosecution disclaimer, this is a moot point. Moreover, the figures in the Cytonome
patents, as depicted above in construing the “direction” terms, disclose tapering at the
primary focusing region.

50

Even so, the court will decline to grant summary judgment to either party because
a reasonable fact finder could conclude that Tashiro discloses a structural narrowing at, or
immediately after, the sample inlet, which arguably causes focusing at the region identified
by defendants as the primary focusing region. (Pls.’ Add’l PFOFs (dkt. #188) ¶ 373
(disputing whether Tashiro discloses broadening of the sheath flow channel before or at
the sample injection site); see also Tashiro (dkt. #166-9) Fig. 3.)
3. Wada
Finally, defendants seek summary judgment on their anticipation claim based on
Wada. Specifically, defendants contend that Wada discloses a primary focusing region
where “a first microchannel intersects the primary sheath flow channel from the right to
introduce additional fluid in the primary sheath flow channel, focusing the sheath fluid
around the particles in a first direction, as shown below (with blue arrow showing the
direction of focusing:”

(Defs.’ Opening Br. (dkt. #162) 193 (citing Di Carlo Rept. (dkt. #129) ¶ 529; Wada (dkt.
#169-8) Fig. 23).)

51

As they did with Tashiro, plaintiffs again argue in response that this area does not
disclose focusing, because the region “constitutes mere injection of a sample into a straight
flow passage” as depicted in Vacca’s report at Case 3B, which shows a sample injection not
involving focusing:

(Pls.’ Opp’n (dkt. #191) 124 (citing Vacca Rebuttal Rept. (dkt. #131) ¶ 146).)
As with Tashiro, therefore, plaintiffs have established a genuine dispute of material
fact as to whether Wada discloses a primary focusing area. Moreover, plaintiffs cast doubt
on whether the area identified by defendants as the secondary focusing area focuses the
sheath fluid around the particle, or simply directs particles into two output channels. (Id.
at 125.) For both reasons, the court must also deny defendants’ motion as to their
anticipation counterclaim based on Wada.

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II. Plaintiffs’ Motion for Summary Judgment
This then leaves plaintiffs’ motion for summary judgment on defendants’ assertions
of inequitable conduct and breach of contract. 21

A. Defendants’ Inequitable Conduct Defense and Counterclaim
“Inequitable conduct is an equitable defense to patent infringement most
appropriately reserved for the court.” Rothman v. Target Corp., 556 F.3d 1310, 1322 (Fed.
Cir. 2009); see also Baxter Healthcare Corp. v. Spectramed, Inc., 49 F.3d 1575, 1584 (Fed. Cir.
1995) (noting that “inequitable conduct is a matter for the trial judge, and not the jury”).
“A party seeking to prove inequitable conduct must show by clear and convincing evidence
[1] that the patent applicant made misrepresentations or omissions material to
patentability, [2] that he did so with the specific intent to mislead or deceive the PTO, and
[3] that deceptive intent was the single most reasonable inference to be drawn from the
evidence.” Ohio Willow Wood Co. v. Alps S., LLC, 813 F.3d 1350, 1357 (Fed. Cir. 2016).
As to the first showing, defendants must show “but-for materiality,” which means proof
that “the PTO would not have allowed the claim had it been aware of the undisclosed prior
art.” Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276, 1291 (Fed. Cir. 2011) (en
banc). However, but-for materiality is not required for “cases of affirmative egregious
misconduct,” such as “the filing of an unmistakably false affidavit.” Id. at 1292. The
Federal Circuit has determined that such cases satisfy the materiality requirement on their

As indicated above, plaintiffs also moved for summary judgment on a finding that defendants’
invalidity defenses and counterclaims based on Tashiro fail as a matter of law. Having addressed
this argument above in conjunction with defendants’ motion for summary judgment based on
anticipation by Tashiro, the court need not address it again.

21

53

face. Id.
Here, defendants’ inequitable conduct defense and counterclaim is premised on two,
alleged acts of misconduct: (1) the intentional withholding of four prior art references by
the inventors, Dr. Bunner and Dr. Gilbert, each of which defendants maintain anticipate
the Cytonome patents; and (2) Dr. Bunner’s allegedly “egregious misconduct” of swearing
that he “reviewed and understood the claims” during the application process, but then
testifying inconsistently at his deposition as to whether he had actually read the claims and
understood them.
As to the first allegation, plaintiffs contend at summary judgment that Tashiro does
not anticipate the Cytonome patents because it does not disclose focusing. Accordingly,
plaintiffs argue, the inventors’ failure to disclose this prior art reference could not have
been with specific intent. Because this argument only concerns one of the four prior art
references, and only the Cytonome claims concerning focusing, this hardly serves as a basis
for summary judgment on defendants’ assertion of inequitable conduct in plaintiffs’ favor.
At most, it might narrow defendants’ bases for pursuing this claim. As previously noted,
however, defendants will face a steep burden in demonstrating that Tashiro discloses a
primary focusing region, making their chances of demonstrating materiality with respect
to this prior art reference appear limited. However, plaintiffs will still have an opportunity
to refine this argument in motions in limine or directed verdict.
Plaintiffs also contend that defendants lack clear and convincing evidence of the
inventors’ specific intent to defraud as to all four pieces of prior art, relying on the
inventors’ deposition testimony that they viewed the references as cumulative. As an initial

54

matter, there appears to be no basis for disputing that the inventors were aware of these
prior art references. Still, awareness does not by itself prove specific intent to deceive.
Therasense, 649 F.3d at 1290 (“Proving that the applicant knew of a reference, should have
known of its materiality, and decided not to submit it to the PTO does not prove specific
intent to deceive.”). Defendants also proffer evidence that the inventors were motivated
by monetary gain in seeking the Cytonome patents, but this would arguably cover most, if
not all, patent applicants, and is not enough to form a sufficient basis to infer specific
intent. Accordingly, defendants’ actual evidence of intent appears limited. Nonetheless,
the court will deny plaintiffs’ motion for summary judgment, finding that these types of
determinations are best made at trial after the benefit of hearing all the testimony and
assessing the credibility of the named inventors. See Key Pharm. v. Hercon Labs. Corp., 161
F.3d 709, 719 (Fed. Cir. 1998) (acknowledging that “the finding on intent in particular
depended heavily on the presentation of evidence and witness testimony at trial” and that
“[t]he trial court was able to hear these matters first hand and assess witness credibility”). 22
Moreover, the trial will also touch on whether Tashiro anticipates the Cytonome patents,
and, therefore, help determine whether the failure to disclose that prior art reference was
material.
As for defendants’ proof of affirmative egregious acts, defendants’ sole evidence is
Bunner’s contemporary affidavit supporting the patent application to the effect that he
understood the claims and his recent deposition testimony, which admittedly casts some

Because defendants’ inequitable conduct claim is a question for the court, see Rothman, 556 F.3d
at 1322, the court will hear this testimony outside of the presence of the jury, while the jury is
deliberating on liability.

22

55

doubt as to whether he read the claims and the extent of his understanding at the time of
application. Here, too, defendants’ evidence is thin given Bunner’s inconsistent deposition
testimony, which falls well short of demonstrating an “egregious act.” Nonetheless, the
court will also be better equipped after hearing Bunner’s testimony at trial to decide
whether he lied when he signed the affidavit supporting the patent application.
Accordingly, the court will deny plaintiffs’ motion for summary judgment on defendants’
inequitable conduct counterclaim, while noting that the evidence presented at summary
judgment suggests defendants will fall short of the high bar required for such a finding.

B. Defendant ABS’s Breach of Contract Counterclaim
Finally, plaintiff ST seeks summary judgment on defendant ABS’s breach of
contract counterclaim, based on defendant ST’s alleged failure to provide sexed semen
straws satisfying the 85% purity requirement in the 2012 Agreement.

ST argues

persuasively that the Agreement is “ambiguous as to the specific methodology to be
employed when testing purity,” and that ambiguity should be “resolved by the parties’
undisputed course of performance. Here, it is undisputed fact that the sole, agreed-upon
method for assessing purity throughout the five-year life of the Agreement is ST’s “flow
cytometry reanalysis.” (Pls.’ Opening Br. (dkt. #167) 38-39.)
To begin, the parties agree that Texas law governs ABS’s breach of contract claim.
“Whether a contract is ambiguous is a ‘question of law for the court to decide by looking
at the contract as a whole in light of the circumstances present when the contract was
entered.’” Amigo Broad., LP v. Spanish Broad. Sys., Inc., 521 F.3d 472, 488 (5th Cir. 2008)
(quoting Coker v. Coker, 650 S.W.2d 391, 394 (Tex. 1983)). “A latent ambiguity exists if

56

the meaning of language used in a written agreement becomes uncertain when applied to
the subject matter of the contract.” Id. (internal citation and quotation marks omitted).
“[I]n determining whether a latent ambiguity exists, courts may examine surrounding
circumstances and the subject matter of the contract.” Id. (internal citations and quotation
marks omitted).
ST maintains that the contract is ambiguous as to the purity-method measurement,
and analogizes this ambiguity to that at issue in Donahue v. Bowles, Troy, Donahue, Johnson,
Inc., 949 S.W.2d 746 (Tex. App. 1997). In Donahue, the contract provided that the value
of shares would be determined by a third-party appraiser. Id. at 753. When appraising
the shares, the third party, however, prepared two valuations, the later of which
incorporated new information received after the first valuation was completed.

Id.

Accordingly, the Texas Court of Appeals found the presence of a latent ambiguity because
the contract was silent on when the valuation was to be completed and whether the shares
could be reappraised in light of new information. Id.
In response, ABS argues that there is no ambiguity. More specifically, as alluded to
above in the facts section, ABS contends that “actual” purity does not change -- even if
there is some variance in any given measurement -- and that the contract unambiguously
requires that ST deliver straws that are at least 85% of the desired sex. (Defs.’ Opp’n (dkt.
#186) 36.) From this, ABS distinguishes Donahue, arguing that in the case of Donahue,
there was “no way to evaluate compliance without first determining . . . which evaluation
is ‘the valuation,’” while here the standard for compliance in the 2012 Agreement is clear.
(Id.)

57

ABS’s attempt to rely on an “actual” purity requirement separate from a
measurement of purity is unworkable at best and disingenuous at worst. How are the
parties to determine compliance other than by relying on a method of measuring purity?
Moreover, ABS does not dispute that even at the time the parties entered into the 2012
Agreement, different purity-measuring techniques could produce different, and potentially
conflicting, results. As such, the court agrees with ST that the Agreement’s silence as to
the appropriate method or technique for measuring purity is a classic example of a latent
ambiguity in a contract.
As ABS points out -- and as ST acknowledges in its briefing -- the presence of a
latent ambiguity typically requires a jury to resolve the ambiguity, determining the parties’
intent. See, e.g., Reilly v. Rangers Mgmt., Inc., 727 S.W.2d 527, 529 (Tex. 1987) (“When a
contract contains an ambiguity, the granting of a motion for summary judgment is
improper because the interpretation of the instrument is a question of fact for the jury.”).
Nevertheless, ST points out that the parties’ course of performance can be considered as
parol evidence in determining the parties’ intent, which it argues here supports a finding
that the parties intended for purity to be measured by ST’s flow cytometer reanalysis.
(Defs.’ Opening Br. (dkt. #167) 41-42.)
On this record, the court agrees that ST’s consistent use of this one method to
measure purity during the course of the 2012 Agreement (and predating it), coupled with
ABS’s acceptance of the sexed semen straws without raising any concern or question about
purity or the method for measurement for the majority of the contract supports a finding
that the parties intended for the flow cytometer reanalysis to be used to measure purity.

58

Even more compelling for the court is ABS’s reliance on this measurement during the entire
life of the Agreement in turning around and selling the same straws to its own customers,
relying on ST’s representation of purity. On this record, the court finds that no reasonable
jury would find such longstanding acceptance of performance did not establish the proper
measure of purity under the 2012 Agreement.
ABS does raise a separate fact issue as to whether the actual purity measurements
under the flow cytometry reanalysis method satisfied the 85% compliance standard. More
specifically, as detailed above, ABS has raised a fact issue as to whether ST’s testing was
“fudged” to demonstrate compliance. There are holes in this evidence, the largest being
that it is hard to discern why a test used without incident for almost the entire five year
life of the 2012 Agreement would suddenly deteriorate in the last few batches, but that is
what ABS’s evidence purports to show, and a reasonable jury might believe that ST decided
to cut corners at the end of a deteriorating business relationship, just as jurors might believe
ABS conjured up this latent quality concern as leverage in the parties’ bargaining dispute.
Regardless, this will be an issue for the jury to sort out.
ST also seeks summary judgment on the basis that the breach did not cause ABS
injury. Under Texas law, unlike Wisconsin law, injury is an element of a breach of contract
claim. See Wicker v. Seterus, Inc., No. EP-17-CV-99-DB, 2018 WL 4856771, at *13 (W.D.
Tex. Oct. 4, 2018) (“The elements of a breach of contract claim in Texas are: (1) there is
a valid and enforceable contract; (2) the plaintiff performed, tendered performance or was
excused from performing; (3) the defendant breached the contract; and (4) the defendant’s
breach caused the plaintiff’s injury.” (citing USAA Tex. Lyods Co. v. Menchaca, 545 S.W.3d

59

479, 501 n.21 (Tex. 2018)). In response, however, ABS argues that it was injured by
overpaying for sexed semen straws that did not meet the purity requirement, and can
pursue a “benefit-of-the-bargain” damages theory under Texas law based on the difference
in price between the “higher-purity sorting it was promised under the 2012 Agreement and
the lower-purity sorting it actually received.” (Defs.’ Opp’n (dkt. #186) 47.) ST rightly
points out the gaping hole in this theory of damages fails given ABS’s admission to selling
all of the allegedly noncompliant straws in the normal course of business, presumably at
the same or higher premium relying on ST’s representation of purity, either by selling them
to ABS customers or by use in its own business. While this is compelling evidence that
ABS was not injured by the breach, and suffered no damages, a reasonable jury might find
otherwise, in light of ABS’s evidence that its customers complained of the purity of STsorted product and ST allowed for discounted pricing or rebates if straws were shown to
be less pure than represented. (Id. at 48; see also Defs.’ Add’l PFOFs (dkt. #188) ¶¶ 13839.) 23

III. Trial Schedule
PTAB has now issued two final decisions with respect to the invalidity challenges of
the ’161 and ’912 patents. (Dkt. ##275-1, 277-1.) Moreover, the Seventh Circuit has

While this evidence may be deemed relevant to injury, ABS has waived any damages claim based
on injury to reputation or lost customers. (Defs.’ Opp’n (dkt. #186) 46 n.13.) ST also challenges
any damage theory based on ABS recouping a liquidated damages payment to ST for ABS’s failure
to purchase a required number of straws. The court need not reach this argument, however, finding
an adequate basis for a jury finding injury and awarded damages under a “benefit-of-the-bargain”
damages theory. Even so, the extent of ABS’s claim to damages will be cabined by its Rule 26
disclosures and any evidence that ABS actually broke even (or even profited) by reselling lower
quality straws. Indeed, both issues may be the proper subject of a motion in limine.
23

60

issued its mandate in ABS I, No. 14-cv-503 (’503 dkt. # 885), and the parties have
stipulated to the retrial proceeding to the same judge (’503 dkt. #886). As such, this case
and ABS I are ready to proceed to a consolidated trial, commencing September 3, 2019.
The court will hold a scheduling conference on May 13, 2019, at 10:00 a.m. The parties
are directed to meet and confer in advance of that hearing to consider any ways to
streamline matters for the jury at trial.

ORDER
IT IS ORDERED that:
1) The reserved portions of defendants’ motion for partial summary judgment (dkt.
#156) is GRANTED IN PART AND DENIED IN PART. Defendants’ motion
for a finding of noninfringement is granted as to (a) the ’161 and ’912 patents
and (b) some of plaintiffs’ infringement theories as to the ’476 and ’309 patents.
The motion is denied as to plaintiffs’ remaining infringement theories as to the
’476 and ’309 patents. The motion also is denied as to defendants’ invalidity
counterclaims.
2) Plaintiffs’ motion for partial summary judgment (dkt. #163) is DENIED.
3) This case and ABS v. Inguran, LLC, No. 14-cv-503, are consolidated for purposes
of trial, commencing September 3, 2019.
4) The court will hold a scheduling conference May 13, 2019, at 10:00 a.m.
Counsel for plaintiff to establish call to chambers at 608-264-5087.
Entered this 29th day of April, 2019.
BY THE COURT:

/s/
__________________________________
WILLIAM M. CONLEY
District Judge

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