Cook Biotech Inc. v. ACell, Inc. , 460 F.3d 1365 ( 2006 )

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United States Court of Appeals for the Federal Circuit
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COOK BIOTECH INCORPORATED,
Plaintiff-Cross Appellant,
and
PURDUE RESEARCH FOUNDATION,
Plaintiff-Cross Appellant,
v.
ACELL, INCORPORATED,
STEPHEN F. BADYLAK and ALAN R. SPIEVACK,
Defendants-Appellants.
Daniel J. Lueders, Woodard, Emhardt, Moriarty, McNett & Henry LLP, of
Indianapolis, Indiana, argued for plaintiff-cross appellant, Cook Biotech Incorporated.
With him on the brief was Holiday W. Banta.
William P. Kealey, Stuart & Branigin LLP, of Lafayette, Indiana, argued for
plaintiff-cross appellant, Purdue Research Foundation.
J. Alan Galbraith, Williams & Connolly LLP, of Washington, DC, argued for
defendants-appellants. With him on the brief were Thomas H. L. Selby, Shruti Rana,
and Jessamyn S. Berniker.
Appealed from: United States District Court for the Northern District of Indiana
Judge Allen Sharp
United States Court of Appeals for the Federal Circuit
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COOK BIOTECH INCORPORATED,
Plaintiff-Cross Appellant,
and
PURDUE RESEARCH FOUNDATION,
Plaintiff-Cross Appellant,
v.
ACELL, INCORPORATED,
STEPHEN F. BADYLAK and ALAN R. SPIEVACK,
Defendants-Appellants.
__________________________
DECIDED: August 18, 2006
__________________________
Before NEWMAN, LOURIE, and PROST, Circuit Judges.
PROST, Circuit Judge.
Defendant-appellants, ACell, Inc. (“ACell”), Stephen F. Badylak, and Alan R.
Spievack appeal the decision of the United States District Court for the Northern District
of Indiana denying ACell’s post-trial motions pertaining to claim construction,
infringement, and the adequacy of the jury verdict form following the jury’s finding that
ACell’s commercial product, ACell Vet™, infringed U.S. Patent No. 5,554,389 (the “’389
patent”) owned by Purdue Research Foundation and that Drs. Badylak and Spievack
willfully induced ACell to infringe. Cook Biotech Inc. v. ACell, Inc., No. 4:03-CV-0046
AS (N.D. Ind. Aug. 17, 2005) (“Post-Trial Order”). Plaintiffs-appellees, Cook Biotech
Inc. and Purdue Research Foundation (respectively, “Cook” and “PRF”; collectively,
“appellees” or “cross-appellants”), cross-appeal the district court’s grant of summary
judgment with respect to inventorship and the district court’s denial of their post-trial
motions pertaining to willful infringement and whether any relief should have been
awarded following the jury’s finding of infringement. Because the district court erred in
its claim construction which formed the basis for the jury’s finding of infringement and
because, under the correct construction, there is no material factual dispute that the
ACell Vet™ product cannot infringe claims 1, 7, and 8 of the ’389 patent literally or
under the doctrine of equivalents, the judgment of infringement is reversed. As a result,
the issues raised in Cook’s cross-appeal pertaining to its willful infringement case and
its requests for relief following the jury verdict in its favor are rendered moot. Finally,
because the district court did not err in determining on summary judgment that (1) Dr.
Badylak is not a co-inventor of U.S. Patent No. 6,576,265 (the “’265 patent”), (2) Dr.
Spievack is an inventor of the ’265 patent, and (3) PRF’s unjust enrichment claim must
fail, we affirm the district court’s rulings with respect to those issues as raised in PRF’s
cross-appeal.
I. BACKGROUND
A. Factual Background
1. Dr. Badylak’s activities and the ’389 patent
Dr. Badylak was employed by Purdue University from 1977 until October 6, 2002.
In the mid-1980s, Dr. Badylak and others in his laboratory at Purdue University
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discovered that certain tissue compositions could be used as scaffolds for tissue
reconstruction. As advancements were made using these tissue compositions, now
known as extracellular matrices or ECMs, the tissues came to be categorized according
to the source of the tissue, e.g., small intestinal submucosa (“SIS”), stomach
submucosa, liver basement membrane, urinary bladder submucosa (“UBS”), and
urinary bladder matrix (“UBM”). The two organ tissue sources relevant to this case are
UBS and UBM.
The ’389 patent, entitled “Urinary Bladder Submucosa Derived Tissue Graft,”
issued on September 10, 1996. The ’389 patent is directed to a urinary bladder
submucosa derived tissue graft composition comprising bladder submucosal tissue
“delaminated from the abluminal muscle layers and at least the luminal portion of the
tunica mucosa of the urinary bladder tissue,” ’389 patent, col. 1, ll. 56-58, that can be
implanted to replace or support damaged or diseased tissues. Claim 1 of the ’389
patent is representative of the claims at issue:
1. A composition comprising urinary bladder submucosa delaminated
from both the abluminal muscle layers and at least the luminal portion of
the tunica mucosa of a segment of a urinary bladder of a warm blooded
vertebrate.
’389 patent, col. 5, ll. 20-23 (emphasis added).
The ’389 patent names four inventors, one of whom is Dr. Badylak. Pursuant to
his employment contract, Dr. Badylak assigned the ’389 patent and the rights to other
patents on inventions he had developed to PRF. On February 9, 2003, PRF granted
Cook an exclusive license with respect to many of its patents in this field of tissue
engineering, including the ’389 patent for all non-orthopedic and non-cardiac
applications.
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2. Dr. Spievack, the ’265 patent, and ACell
Dr. Spievack, a Harvard University professor and surgeon, developed an interest
in the regenerative capabilities of the epithelial basement membrane during his studies
as a Fulbright scholar in the 1950s. In early 1996, Dr. Spievack first met Dr. Badylak at
a conference during a presentation given by Dr. Badylak pertaining to SIS.
According to Dr. Spievack, in March 1996, he tested techniques for removing
various tissue layers of the bladder wall and in July of that year, he successfully treated
poison ivy on one of his legs with a bladder basement membrane composition. Dr.
Spievack testified that between February and October 1996, he did not discuss the
results of his basement membrane tests with Dr. Badylak, but from the end of 1996
through the end of 1999, he visited Dr. Badylak at Purdue University and discussed his
work on graft compositions.
Beginning in 1998, Dr. Spievack sought to obtain a license from PRF for non-SIS
products. When PRF ultimately turned him down, Dr. Spievack continued to work on
what he considers to be his own UBM technology. In 1999, Dr. Spievack formed ACell,
Inc. to research and develop extracellular matrix technology. On December 22 of that
year, Dr. Spievack filed a provisional application on a UBM composition, which led to
the issuance of two patents naming him as the sole inventor, the ’265 patent and U.S.
Patent No. 6,579,538 (the “’538 patent”). The term UBM first appeared in the ’265
patent, which issued on June 10, 2003. UBM refers to a matrix of tissues including the
basement membrane and tunica propria of the urinary bladder of a mammal. The ’265
patent discloses and claims, inter alia, a tissue graft composition including the epithelial
basement membrane.
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On August 27, 2002, while the ’265 patent was still pending, PRF asked the
United States Patent and Trademark Office (the “PTO”) to declare an interference
pursuant to 37 C.F.R. § 1.47(a). In its petition, PRF asserted that four other individuals,
including Dr. Badylak, were co-inventors with Dr. Spievack of the invention claimed in
the ’265 patent.1
The accused product, ACell Vet™, is sold by ACell in three forms: hydrated,
lyophilized, and powdered. Since the issuance of the ’265 patent, ACell has
represented that its product includes the epithelial basement membrane as disclosed
and claimed in the ’265 patent.
B. Procedural History
1. Appellees’ infringement case
Cook and PRF sued ACell for, inter alia, patent infringement of claims 1, 7, and 8
of the ’389 patent, correction of inventorship for a number of issued patents2
(collectively, the “Disputed Patents”), and common law unjust enrichment for the
research and inventions disclosed in the Disputed Patents. On September 4, 2003,
appellees moved for a preliminary injunction, seeking to enjoin the sale of ACell Vet™.
The district court denied the motion based on the record before it, preliminarily finding
that claim 1 of the ’389 patent “does not . . . extend beyond an essentially submucosa
1
Although the actions to initiate the interference were discussed by the
parties, the ultimate resolution of the proceeding, if one in fact occurred, has not been
the subject of the parties’ briefs before us.
2
PRF sought correction of inventorship and ownership for the ’265 patent
and eleven other patents that claim priority to the December 22, 1999 filing date of the
provisional patent application that resulted in the ’265 patent including U.S. Patent Nos.
6,579,538, 6,783,776, 6,849,273, 6,852,339, 6,861,074, 6,869,619, 6,887,495,
6,890,562, 6,890,563, 6,890,564, 6,893,666.
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composition,” and emphasized that its findings were based on a preliminary record and
were not intended to be a Markman ruling on claim construction. Cook Biotech Inc. v.
ACell, Inc., No. 4:03-CV-0046 AS, slip op. at 10 (N.D. Ind. Dec. 22, 2003).
After conducting a Markman hearing, during which the district court solicited the
parties’ proposed constructions in the form of jury instructions, the district court adopted
appellees’ proposed instructions. See Cook Biotech Inc. v. ACell, Inc., No. 4:03-CV-
0046 AS (N.D. Ind. Oct. 25, 2004) (“Markman Order”). Of particular relevance, the
district court rejected ACell’s proposed construction for “urinary bladder submucosa”
and “at least the luminal portion of the tunica mucosa” and adopted appellees’ proposed
construction of the phrase “at least the luminal portion of the tunica mucosa.” The
district court rejected ACell’s proposed construction of “urinary bladder submucosa”
because it believed that the invention disclosed in the ’389 patent was broad enough to
include compositions that contained tissues other than submucosa. Id., slip op. at 9-10.
Further, because the district court believed that ACell’s proposed construction of
“urinary bladder submucosa” would rewrite the claims (i.e., change an open transition,
comprising, into a closed transition, consisting essentially of), it was unwilling to accept
that construction. The district court was also convinced by the evidence presented at
the hearing and the ordinary meaning of the tunica mucosa that “the luminal portion of
the tunica mucosa” refers only to the epithelial cells. Id., slip op. at 10-11.
On June 17, 2005, the district court considered a motion by appellees seeking
summary judgment of patent infringement or, in the alternative, partial summary
judgment that the only issue remaining for the jury with respect to whether ACell
infringes claims 1, 7, and 8 of the ’389 patent is whether ACell’s product contains
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submucosa. Based on the submissions of the parties, the district court granted
appellees’ alternative motion for partial summary judgment leaving only one issue for
trial with respect to infringement of those claims: whether the ACell product contained
any urinary bladder submucosa.3 Accordingly, the district court instructed the jury that
appellees must prove
[t]hat it is more likely than not that . . . [ACell’s] product includes any
amount of submucosa. In making this determination you should keep in
mind that submucosa, as I have defined it, does not require any particular
amount of submucosa, and that the presence of any submucosa in the
ACell product requires a finding of infringement.
In response, the jury returned a verdict finding that ACell infringed claims 1, 7, and 8 of
the ’389 patent, but found that the infringement was not willful.
With respect to damages, on the first day of trial, the district court granted ACell’s
motion in limine seeking to preclude appellees from presenting lost profits damages to
the jury because the district court found that appellees failed to establish an
“appropriate record” with respect to damages sufficient to raise a jury issue. That ruling
effectively precluded appellees from obtaining damages because they had sought only
lost profits damages, and not a reasonable royalty. Thus, even though the jury returned
a verdict in their favor, appellees were not awarded any damages.
Following the judgment, both parties filed post-trial motions. ACell moved the
district court to amend the judgment after this court issued its opinion in Phillips v. AWH
Corp., 415 F.3d 1303 (Fed. Cir. 2005) (en banc). ACell contended that this court’s
3
Apparently based on its rejection of ACell’s proposed construction for
claim 8, the district court did not require, as part of appellees’ infringement case, that
they prove that the accused ACell Vet™ product could in fact “induce endogenous
connective tissue growth” as required by claim 8.
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decision in Phillips made it clear that ACell’s proposed claim constructions were correct
and that a product that did not remove the lamina propria, basement membrane, and
epithelial cells could not infringe the ’389 patent. Appellees filed post-trial motions for
lost profits damages, willfulness as a matter of law, and attorney fees. While the district
court denied the parties’ motions, it also stayed enforcement of a permanent injunction
because it found that this court’s decision in Phillips “raises enough doubt at this point
under these under [sic] the totality of the circumstances of this case to cause this court
to stay its hand and grant the stay of enforcing a permanent injunction pending the
appeal in this case.” Post-Trial Order, slip op. at 3.
2. PRF’s Case and Inventorship
The district court also considered several motions for summary judgment relating
to inventorship issues filed by appellees and ACell. Specifically, appellees sought to
establish on summary judgment that Dr. Badylak is a joint inventor of the ’265 patent.
Appellees alleged that Dr. Badylak collaborated with Dr. Spievack in developing the
urinary bladder as a tissue graft composition as claimed in the ’265 patent, and that
because Dr. Badylak is under an obligation to assign the inventions he made while at
Purdue to PRF, PRF is a rightful owner of the ’265 patent. ACell filed its own summary
judgment motion on Count IV (“unjust enrichment”) of PRF’s complaint and a partial
summary judgment motion on Counterclaim Counts I (“rights to technology”) and II
(“inventorship”).
The district court first noted that appellees had failed to assert that Dr. Badylak is
the sole inventor of the ’265 patent in their complaint, their interrogatory responses, and
the Pretrial Order. Instead, the district court found that appellees’ assertions were
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limited to “omitted” inventors. Thus, the district court precluded appellees from
asserting that Dr. Badylak was the sole inventor or that Dr. Spievack was not a proper
inventor of the ’265 patent because of those failures.
Second, the district court found that appellees had failed to present clear and
convincing evidence that Dr. Badylak contributed in some significant manner to the
conception of the invention claimed in the ’265 patent. In reaching that conclusion, the
district court began its analysis with the presumption that the named inventors on a
patent are correct, and also found that: (1) Dr. Badylak had filed papers under oath with
the PTO in which he denied inventorship of the ’265 patent; (2) the evidence
demonstrated that Dr. Spievack conceived and reduced to practice the invention
claimed in the ’265 patent; (3) Dr. Spievack had completed the invention claimed in the
’265 patent by the summer of 1996 when he successfully treated his poison ivy with it;
and (4) any discussions between Drs. Badylak and Spievack after the summer of 1996
were irrelevant to the issue of inventorship because Dr. Spievack conceived the ’265
patented invention by that summer.
Finally, the district court found that the deposition excerpts cited by appellees, in
support of their assertion that Dr. Spievack discussed the use of the basement
membrane as a tissue graft material with Dr. Badylak at the 1996 conference, “fail[ed] to
show that [Dr.] Badylak contributed anything to [Dr.] Spievak’s [sic] conception of the
invention, let alone that [Dr.] Badylak contributed ‘in some significant manner’” as
required by our holding in BJ Services Co. v. Halliburton Energy Services, Inc., 338
F.3d 1368, 1373 (Fed. Cir. 2003). Cook Biotech Inc. v. ACell, Inc., No. 4:03-CV-0046
AS, slip op. at 9 (N.D. Ind. June 22, 2003) (“Inventorship Order”). Because the district
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court found that appellees’ evidence failed to meet the clear and convincing evidence
standard to correct inventorship, it denied appellees’ motion for summary judgment that
Dr. Badylak was a co-inventor of the ’265 patent.
In considering ACell’s partial summary judgment motion on Counterclaim Counts
I (“rights to technology”) and II (“inventorship”), the district court noted that it interpreted
ACell’s motion as a request for a declaration to the effect that Dr. Spievack is an
inventor of the ’265 patent. Relying on its previous determinations with respect to
inventorship, the district court granted ACell’s motion for a declaration that Dr. Spievack
is an inventor of the ’265 patent. See infra Part II.B.4.
With respect to ACell’s motion for summary judgment on appellees’ Counterclaim
Count IV (“unjust enrichment”) under Indiana law, the district court found that because
the rights of the parties were controlled by an express contract, recovery could not be
based upon a theory implied in law, e.g., unjust enrichment. Additionally, the district
court found that appellees’ chosen remedy, assuming they could prove unjust
enrichment, of a constructive trust was not available because they failed to assert either
actual or constructive fraud in their complaint.
ACell appeals the district court’s construction of “urinary bladder submucosa” and
“at least the luminal portion of the tunica mucosa,” the jury’s findings of infringement of
claims 1, 7, and 8 of the ’389 patent, and the adequacy of the verdict form. Cook cross-
appeals several rulings by the district court with respect to its willfulness case and the
district court’s decision to stay an award of a permanent injunction until after appeal to
this court. PRF cross-appeals several of the district court’s rulings pertaining to
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inventorship and its dismissal of PRF’s unjust enrichment claim. We have jurisdiction
pursuant to 28 U.S.C. § 1295(a)(1).
II. DISCUSSION
A. Standard of Review
We review a district court’s grant of summary judgment de novo, reapplying the
standard applicable at the district court. Rodime PLC v. Seagate Tech., Inc., 174 F.3d
1294, 1301 (Fed. Cir. 1999). Summary judgment is appropriate when it has been
shown “that there is no genuine issue as to any material fact and that the moving party
is entitled to a judgment as a matter of law.” Fed. R. Civ. P. 56(c); Scaife v. Cook
County, 446 F.3d 735, 739 (7th Cir. 2006).
We review the district court’s denial of a motion for JMOL de novo. Harris Corp.
v. Ericsson Inc., 417 F.3d 1241, 1248 (Fed. Cir. 2005). A court may grant JMOL on an
issue when “there is no legally sufficient evidentiary basis for a reasonable jury to find
for [the nonmoving] party on that issue . . . .” Fed. R. Civ. P. 50(a)(1).
Determining infringement generally requires two steps. “First, the claim must be
properly construed to determine its scope and meaning. Second, the claim as properly
construed must be compared to the accused device or process.” Carroll Touch, Inc. v.
Electro Mech. Sys., Inc., 15 F.3d 1573, 1576 (Fed. Cir. 1993).
Claim construction is an issue of law that we review de novo. Cybor Corp. v.
FAS Techs., Inc., 138 F.3d 1448, 1456 (Fed. Cir. 1998) (en banc); Markman v.
Westview Instruments, Inc., 52 F.3d 967, 979 (Fed. Cir. 1995) (en banc), aff’d, 517 U.S.
370 (1996). “When interpreting claims, we inquire into how a person of ordinary skill in
the art would have understood [the] claim terms at the time of the invention.” Pfizer, Inc.
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v. Teva Pharms., USA, Inc., 429 F.3d 1364, 1372-73 (Fed. Cir. 2005) (citing Phillips,
415 F.3d at 1313). “The inquiry into how a person of ordinary skill in the art
understands a claim term provides an objective baseline from which to begin claim
interpretation.” Id. “Importantly, the person of ordinary skill in the art is deemed to read
the claim term not only in the context of the particular claim in which the disputed term
appears, but in the context of the entire patent, including the specification.” Id. “[O]ur
cases recognize that the specification may reveal a special definition given to a claim
term by the patentee that differs from the meaning it would otherwise possess. In such
cases, the inventor’s lexicography governs.” Phillips, 415 F.3d at 1316.
Infringement, whether literal or under the doctrine of equivalents, is a question of
fact. Bai v. L & L Wings, Inc., 160 F.3d 1350, 1353 (Fed. Cir. 1998). The proper inquiry
is whether the evidence is such that a reasonable jury could return a verdict for the non-
movant. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986). We must draw
all justifiable inferences in favor of the non-movant. Id. When a district court’s
determination of infringement is premised on an erroneously construed claim, however,
that determination is not entitled to deference. Playtex Prods., Inc. v. Procter & Gamble
Co., 400 F.3d 901, 906 (Fed. Cir. 2005) (citing Elkay Mfg. Co. v. Ebco Mfg. Co.,192
F.3d 973, 976 (Fed. Cir. 1999)).
Evidentiary rulings are generally not unique to patent law and therefore we
review them under the law of the regional circuit. Advanced Cardiovascular Sys., Inc. v.
Medtronic, Inc., 265 F.3d 1294, 1308 (Fed. Cir. 2001). The Seventh Circuit reviews a
district court’s evidentiary rulings for an abuse of discretion. Wollenburg v. Comtech
Mfg. Co., 201 F.3d 973, 977 (7th Cir. 2000) (citations omitted).
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Generally, inventorship is a question of law that is reviewed de novo, subject to
review of underlying factual findings for clear error. Univ. of Colo. Found., Inc. v. Am.
Cyanamid Co., 342 F.3d 1298, 1308-09 (Fed. Cir. 2003). However, where the
inventorship issues were resolved on summary judgment, “such factual inferences as
are material to the grant [of summary judgment] are not reviewed under the clearly
erroneous standard, as if they were findings of fact made following a trial of issues[,]”
Lemelson v. TRW, Inc., 760 F.2d 1254, 1260 (Fed. Cir. 1985), but rather are reviewed
de novo, reapplying the standard applicable at the district court, see Rodime PLC, 174
F.3d at 1301 (Fed. Cir. 1999). “[T]o be a joint inventor, an individual must make a
contribution to the conception of the claimed invention that is not insignificant in quality,”
and the inventors must “have some open line of communication during or in temporal
proximity to their inventive efforts . . . .” Eli Lilly & Co. v. Aradigm, 376 F.3d 1352, 1358-
59 (Fed. Cir. 2004).
Assignment of ownership is governed by state law doctrines. Univ. of Colo., 342
F.3d at 1308.
B. Analysis
1. Claim Construction
a. “urinary bladder submucosa”
ACell asserts that the district court erred in construing the term “urinary bladder
submucosa” in claims 1, 7, and 8 of the ’389 patent. ACell asserts that the PTO did not
grant the ’389 patent inventors a patent to the naturally occurring submucosa layer of a
urinary bladder, but rather that it granted them a patent covering a tissue graft
composition derived from that layer. ACell argues that the ’389 specification makes
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clear that “urinary bladder submucosa” is a defined term which was defined to expressly
exclude other urinary bladder tissue layers, specifically the abluminal muscle cell layers
and at least the luminal portion of the tunica mucosa layer.
Cook argues that the ’389 patent specification, specifically in the “DETAILED
DESCRIPTION OF THE INVENTION” section, teaches that the term “urinary bladder
submucosa” is broader than ACell’s proposed construction because it states that the
resulting composition “typically” consists essentially of urinary bladder submucosa.
Cook thus asserts that the use of “typically” implies that there is another possible
embodiment of the claimed composition that merely comprises urinary bladder
submucosa, but may also include other tissues.
As noted above, claim 1 recites: “A composition comprising urinary bladder
submucosa delaminated from both the abluminal muscle layers and at least the luminal
portion of the tunica mucosa of a segment of a urinary bladder of a warm blooded
vertebrate.” ’389 patent, col. 5, ll. 20-23 (emphasis added). The ’389 patent
specification, in the “BACKGROUND AND SUMMARY OF THE INVENTION” section,
states that “[u]rinary bladder submucosa for use in accordance with the present
invention is delaminated from the abluminal muscle layers and at least the luminal
portion of the tunica mucosa of the urinary bladder tissue.” Id. at col. 1, ll. 55-58
(emphasis added). The first paragraph of the “DETAILED DESCRIPTION OF THE
INVENTION” section states:
The tissue graft of composition in accordance with the present invention
comprises urinary bladder submucosa of a warm-blooded vertebrate
delaminated from adjacent bladder tissue layers. The present tissue graft
composition thus comprises the bladder submucosa delaminated from
abluminal muscle cell layers and at least the luminal portion of the
mucosal layer of a segment of urinary bladder of a warm-blooded
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vertebrate. Typically the delamination technique described below provides
a tissue composition consisting essentially of urinary bladder submucosa.
These compositions are referred to herein generically as urinary bladder
submucosa (UBS).
Id. at col. 2, ll. 1-4 (emphases added).
“[T]he specification may reveal a special definition given to a claim term by the
patentee that differs from the meaning it would otherwise possess. In such cases, the
inventor's lexicography governs.” Phillips, 415 F.3d at 1316. We believe that this is
exactly what the ’389 patentees did in this case. As the above quoted portions of the
specification indicate, the composition invented was defined to be “urinary bladder
submucosa delaminated from abluminal muscle cell layers and at least the luminal
portion of the tunica mucosa of the urinary bladder tissue.” See, e.g., ’389 patent, col.
1, ll. 56-58. The specification also indicates that the resulting composition “typically”
consists essentially of urinary bladder submucosa. Thus, while the composition clearly
includes urinary bladder submucosa, it may also include other tissues, such as the non-
luminal portion of the tunica mucosal layer. However, it cannot include that which was
expressly excluded in the patentees’ definition, i.e., the “abluminal muscle cell layers
and at least the luminal portion of the tunica mucosa.” Therefore, we construe “urinary
bladder submucosa” as it is defined in the ’389 patent specification to mean “urinary
bladder submucosa delaminated from the abluminal muscle cell layers and at least the
luminal portion of the tunica mucosa of the urinary bladder tissue,” and it thus becomes
necessary to determine which tissue layers are encompassed by the phrase “at least
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the luminal portion of the tunica mucosa.”4
b. “the luminal portion of the tunica mucosa”
ACell argues that the district court erred in construing the term “the luminal
portion of the tunica mucosa.” ACell asserts that this term was defined by the patentee
through the ’389 patent’s incorporation by reference of the procedure for preparing
intestinal submucosa as detailed in U.S. Patent No. 4,902,508 (the “’508 patent”).
According to ACell, the ’508 patent specification defines “the luminal portion of the
tunica mucosa” as “layer G” which includes the lamina epithelialis mucosa (or the
epithelium layer) and its lamina propria. Thus, ACell asserts that the term “the luminal
portion of the tunica mucosa” in the ’389 patent should be given the same meaning, i.e.,
the epithelium layer and the tunica propria5 layer.
Appellees argue in response that the phrase “at least the luminal portion of the
tunica mucosa” does not require a special definition and accuse ACell of “fishing” for a
special definition. Further, appellees assert that there is no basis for importing a
definition, even assuming the term is defined as ACell alleges, of the term from the ’508
patent into the ’389 patent because the ’508 patent is directed to SIS whereas the ’389
patent is directed to UBS. Appellees assert that the district court’s construction of the
term as “the epithelial cells” should be affirmed.
4
Because the parties’ dispute does not involve the phrase “abluminal
muscle cell layers,” we do not address which tissue layers are referenced by that
language.
5
The parties and patents at issue refer to this layer as the tunica or lamina
propria and either reference is understood to refer to the same tissue layer.
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The phrase “urinary bladder submucosa” is present in all three claims at issue.
Based on our construction of that term as meaning “urinary bladder submucosa
delaminated from . . . at least the luminal portion of the tunica mucosa,” our construction
of “the luminal portion of the tunica mucosa” applies to all three claims with equal force.
We begin with the representative claim language from claim 1 of the ’389 patent, which
states:
1. A composition comprising urinary bladder submucosa delaminated
from both the abluminal muscle layers and at least the luminal portion of
the tunica mucosa of a segment of a urinary bladder of a warm blooded
vertebrate.
’389 patent, col. 5, ll. 20-23 (emphases added). The ’389 patent specification informs
our inquiry into the meaning of the claims. The “BACKGROUND AND SUMMARY OF
THE INVENTION” section discloses that “[t]he wall of the urinary bladder is composed
of the following layers: the tunica mucosa (including a transitional epithelium layer and
the tunica propria), a submucosa layer, up to three layers of muscle and the adventitia
(a loose connective tissue layer)―listed in thickness crossection from luminal to
abluminal sides.” Id. at col. 1, ll. 49-55. The “DETAILED DESCRIPTION OF THE
INVENTION” section sheds considerable light on the issue before us. It states:
The preparation of UBS from a segment of urinary bladder is similar to the
procedure for preparing intestinal submucosa detailed in U.S. Patent No.
4,902,508, the disclosure of which is expressly incorporated herein by
reference. A segment of urinary bladder tissue is first subjected to
abrasion using a longitudinal wiping motion to remove both the outer
layers (particularly the abluminal smooth muscle layers) and the luminal
portions of the tunica mucosa layers―the epithelial layers). The resulting
submucosa tissue has a thickness of about 80 micrometers, and consists
primarily (greater than 98%) of a cellular, eosinophilic staining (H&E stain)
extracellular matrix material.
05-1458, -1558, -1559 17
Id. at col. 2, ll. 17-28 (emphasis added). That paragraph makes clear that “the luminal
portions of the tunica mucosa layers”6 were defined by the patentee as the “epithelial
layers” and that “the procedure for preparing intestinal submucosa” as detailed in the
’508 patent is expressly incorporated by reference into the ’389 patent specification.
The term “epithelial layers” may arguably be subject to two interpretations. On
the one hand, it refers to “layers” which appears to reflect that it was meant to
encompass more than just the transitional epithelium layer, i.e., the transitional
epithelium layer and the tunica propria layer, the only other layer that the ’389 patent
teaches is part of the tunica mucosa. See id. at col. 1, ll. 51-52. On the other hand, as
recognized by the district court, the epithelium in the urinary bladder is made up of
multiple layers of epithelial cells. Markman Order, slip op. at 10. Even accepting that
the disclosure in the ’389 patent specification itself is less than clear as to which
interpretation is correct, the second important disclosure of the ’389 specification is
dispositive. As noted, the ’389 patent specification expressly incorporates by reference
the procedure for preparing intestinal submucosa from the ’508 patent.
“Incorporation by reference provides a method for integrating material from
various documents into a host document . . . by citing such material in a manner that
makes clear that the material is effectively part of the host document as if it were
explicitly contained therein.” Advanced Display Sys., Inc. v. Kent State Univ., 212 F.3d
1272, 1282 (Fed. Cir. 2000) (citations omitted). “To incorporate material by reference,
the host document must identify with detailed particularity what specific material it
6
While we recognize that the phrase in the specification refers to the
luminal portions and the claim language refers to the luminal portion, this section of the
specification sheds the most light on how the patentee chose to define the claim term.
05-1458, -1558, -1559 18
incorporates and clearly indicate where that material is found in the various documents.”
Id. (citations omitted). Whether and to what extent material has been incorporated by
reference into a host document is a question of law. Id.The relevant portions of the ’508 patent specification are as follows:
Layers E, F, and G collectively represent the so-called tunica mucosa.
Layer E is a layer of smooth muscle cells known as the lamina muscularis
mucosa. Layer F, the stratum compactum, consists of acellular collagen
and elastin fibers. Layer G consists of the lamina epithelialis mucosa and
its lamina propria, which together and arranged in villous processes, a
series of finger-like outgrowths of the mucous membrane.
....
The tissue graft material of this invention is prepared by abrading intestinal
tissue to remove the outer layers including both the tunica serosa and the
tunica muscularis (layers B and C in FIG. 1) and the inner layers including
at least the luminal portion (layer G) of the tunica mucosa (layers E
through G in FIG. 1).
’508 patent, col. 3, ll. 13-20, 53-58 (emphases added).
Id. at fig. 1.
As this disclosure makes clear: (1) “the luminal portion of the tunica mucosa” is
represented by “layer G” in Figure 1 of the ’508 patent, and (2) layer G in that figure
corresponds to the lamina epithelialis mucosa and its lamina propria. Id. Even
05-1458, -1558, -1559 19
acknowledging appellees’ argument that the layers of the wall of the intestine are
somewhat structurally different than the layers of the wall of the bladder, neither party
disputes that the basement membrane of the transitional epithelium is located between
the epithelialis mucosa layer and its lamina propria layer in both organs. Thus, because
the basement membrane is located between the two tissue layers explicitly identified,
“the luminal portion of the tunica mucosa” must also refer to the basement membrane.
Therefore, “the luminal portion of the tunica mucosa” means the lamina epithelialis
mucosa (or transitional epithelium layer), the basement membrane, and the lamina
propria.
The ’389 patent’s incorporation by reference of the ’508 patent’s procedure for
preparing intestinal submucosa, in combination with the ’508 patent’s disclosure
pertaining to which tissue layers are removed by that procedure, leads to the conclusion
that the patentee’s definition of the claim term as reflected in the ’389 patent as the
epithelial layers and in the ’508 patent as the lamina epithelialis mucosa and its lamina
propria was intended to refer to the same structures, i.e., the lamina epithelialis mucosa
(or transitional epithelium layer), the basement membrane, and the lamina propria.
The district court’s reasoning is contradicted by its own analysis. Relying on a
medical dictionary, the district court recognized that the tunica mucosa comprises the
epithelium, basement membrane, lamina propria mucosae, and lamina muscularis
mucosae. Markman Order, slip op. at 10-11. The court then rejected ACell’s proposed
construction that “the luminal portion of the tunica musoca” means the epithelial cells
(i.e., the transitional epithelium), the basement membrane, and the lamina propria
because the term “would not require the entire tunica mucosa including the basement
05-1458, -1558, -1559 20
membrane, tunica propria and all epithelial cells to be removed as ACell contends.” Id.,slip op. at 11.
That statement by the district court reflects that it believed ACell’s proposed
construction of that term encompassed the entire tunica mucosa, rather than just “the
luminal portion” as the claim requires. The district court’s reasoning, however,
overlooks the fact that ACell’s construction permits the retention of the lamina
muscularis mucosae layer of the tunica mucosa. This construction is consistent with
both the medical dictionary’s list of layers that comprise the tunica mucosa, and the
teachings of the ’508 patent, which specifically refer to that layer as “layer E” of the
tunica mucosa. ’508 patent, col. 3, ll. 14-15. As this discussion indicates, ACell’s
proposed construction does not require removal of the entire tunica mucosa as the
district court’s opinion suggests, but rather removal of only a portion of the tunica
mucosa.7 Therefore, we construe “the luminal portion of the tunica mucosa” to mean
“the lamina epithelialis mucosa (or transitional epithelium layer), the basement
membrane, and the lamina propria.”
2. Infringement
a. Literal Infringement
ACell asserts that if we agree that the district court erred in its claim construction,
a new trial is not necessary and we should reverse the judgment of literal infringement.
7
The district court also relied upon extrinsic evidence in the form of
testimony from a Dr. Harbin who convinced the court that there was no compelling
reason on the part of Cook to remove the basement membrane, lamina propria, or any
other non-cellular component of the bladder wall layers. Markman Order, slip op. at 11.
In light of the discussion above, however, such extrinsic evidence cannot override the
patentee’s definition of the term contained in the intrinsic evidence of the ’389 and ’508
patent disclosures.
05-1458, -1558, -1559 21
It submits that its ACell Vet™ product cannot infringe claims 1, 7, and 8 of the ’389
patent because those claims require that the urinary bladder submucosa in the claimed
compositions be delaminated from “the luminal portion of the tunica mucosa,” and its
product is not so delaminated. Rather, ACell’s product retains part of “the luminal
portion of the tunica mucosa” of a segment of a urinary bladder, i.e., the basement
membrane and the lamina propria. Thus, ACell argues that because “the luminal
portion of the tunica mucosa” is not delaminated as required by those claims, its product
cannot infringe the asserted claims. Appellees agree with ACell that if we were to
interpret any of the claims to exclude lamina propria, the ACell Vet™ product cannot
literally infringe the asserted claims.
We agree with the parties that the ACell Vet™ product cannot, as a matter of
law, literally infringe claims 1, 7, and 8 of the ’389 patent because it contains the
basement membrane and the lamina propria, tissue layers that are expressly excluded
by the terms “urinary bladder submucosa” and “the luminal portion of the tunica
mucosa” as the patentees have so defined them, and as we have thus construed them.
b. Infringement Under the Doctrine of Equivalents
Appellees assert, however, that even if summary judgment of non-infringement is
appropriate with respect to literal infringement, a new trial may be necessary on the
question of infringement under the doctrine of equivalents. They argue that the
evidence supports the theory that compositions that include lamina propria and
submucosa are equivalent to compositions that consist essentially of submucosa
because the two compositions perform the same function, in the same way, to achieve
the same result.
05-1458, -1558, -1559 22
ACell makes two arguments in response. First, it asserts that appellees did not
preserve any argument under the doctrine of equivalents because they failed to assert
any such theories of equivalents in the detailed portion of the pretrial order relating to
infringement. Second, ACell argues that the “all limitations rule” bars the capture, under
the doctrine of equivalents, of elements specifically excluded by a claim limitation.
Because claims 1, 7, and 8 claim a composition comprising urinary bladder submucosa,
and such submucosa must have been delaminated from “the luminal portion of the
tunica mucosa,” an accused product that contains some or all of “the luminal portion of
the tunica mucosa” cannot infringe under the doctrine of equivalents.
Assuming that appellees could overcome their failure to preserve an issue with
respect to infringement under the doctrine of equivalents, we conclude that applying
appellees’ theory of equivalence with respect to asserted claims would violate “a
corollary to the ‘all limitations rule[,]’ . . . that ‘the concept of equivalency cannot
embrace a structure that is specifically excluded from the scope of the claims.’” Athletic
Alternatives v. Prince Mfg., 73 F.3d 1573, 1582 (Fed. Cir. 1996) (quoting Dolly, Inc. v.
Spalding & Evenflo Cos., Inc., 16 F.3d 394, 400 (Fed. Cir. 1994)). The ACell Vet™
product consists of basement membrane and tunica propria, two tissue layers
specifically excluded from the claimed composition by delaminating “the luminal portion
of the tunica mucosa.” See supra Part II.B.1.b. A claim that specifically excludes an
element cannot through a theory of equivalence be used to capture a composition that
contains that expressly excluded element without violating the “all limitations rule.”
Permitting appellees to assert such a theory of equivalence would effectively remove
the requirement that the urinary bladder submucosa be delaminated from “the luminal
05-1458, -1558, -1559 23
portion of the tunica mucosa.” Thus, there is “no . . . material issue for the jury to
resolve,” see Warner-Jenkinson Co., Inc. v. Hilton Davis Chem. Co., 520 U.S. 17, 39
n.8 (1997), and a judgment of non-infringement under the doctrine of equivalents with
respect to the asserted claims of the ’389 patent is appropriate.
In addition, because we have concluded that there was no direct act of
infringement, the finding that Drs. Badylak and Spievack willfully induced ACell to
infringe must also be reversed. Lastly, because we have concluded that ACell does not
infringe claims 1, 7, and 8 of the ’389 patent as a matter of law, the other issues raised
by ACell with respect to the jury instructions and verdict form are rendered moot.
3. Cook’s Cross-Appeal
Because we have concluded that no genuine issue of material fact remains with
respect to whether ACell infringes claims 1, 7, and 8 of the ’389 patent, Cook’s cross-
appeal pertaining to the district court’s refusal to award a permanent injunction, and the
district court’s rulings with respect to its willful infringement case, including its challenge
to several evidentiary rulings by the district court,8 the jury instructions, and the verdict
form, are rendered moot.
8
The evidentiary issues pertain to the district court’s exclusion of the “pre-
September 2002” documents and grant proposals drafted by Drs. Spievack and
Badylak. The district court did not abuse its discretion in excluding those documents
and in limiting appellees’ infringement case to the ACell Vet™ commercial product
because that was the only allegedly infringing product identified by appellees in the
Pretrial Order: “Defendant ACell, Inc. manufactures, sells, uses, and offers for sale a
veterinary product under the trade name ACell Vet.” Cook Biotech Inc. v. ACell, Inc.,
No. 4:03-CV-0046 AS, slip op. at 19 (N.D. Ind. Apr. 14, 2005).
05-1458, -1558, -1559 24
4. PRF’s Cross-Appeal
In its cross-appeal, PRF raises two issues with respect to the district court’s
determination of inventorship and also challenges the district court’s dismissal of its
unjust enrichment claim. With respect to inventorship, PRF asserts that the district
court erred by summarily determining that Dr. Badylak is not an inventor of the Disputed
Patents and that Dr. Spievack is the sole inventor of the Disputed Patents.9 PRF
essentially asserts that the district court erred because the documentary evidence
showed that Dr. Badylak worked on a graft composition that included the basement
membrane as early as 1994 and that Dr. Badylak collaborated with Dr. Spievack before
the priority date of the Disputed Patents. Specifically, PRF argues that the district court
focused on the wrong time period, i.e., between 1994 and 1996, the date Dr. Spievack
allegedly conceived, and reduced to practice, the invention claimed in the ’265 patent,
9
Cross-appellants characterize the district court’s Inventorship Order as
having found on summary judgment that Dr. Spievack was the sole inventor of the ’265
patent. ACell reframes the issue in its reply to the cross-appeal as whether the district
court abused its discretion in holding that cross-appellants could not assert that Dr.
Spievack was not an inventor of the ’265 patent because cross-appellants failed to raise
that issue in the Pretrial Order. With respect to inventorship, the district court’s June 22,
2005 Order made the following determinations: (1) cross-appellants were precluded
from asserting that Dr. Badylak is the sole inventor of the ’265 patent because they
failed to raise that theory of inventorship in the their Complaint and the Pretrial Order,
Inventorship Order, slip op. at 6-7; (2) cross-appellants’ motion for summary judgment
that Dr. Badylak is an inventor of the ’265 patent was dismissed, id., slip op. at 10; and
(3) ACell’s Motion for Partial Summary Judgment on Counterclaim Count II
(inventorship) to the extent that the district court determined “that Spievak [sic] is an
inventor of the ’265 patent . . . ,” was granted, id., slip op. at 13 (emphasis added). As
can be seen by the quoted portion above, the district court summarily determined that
Dr. Spievack is an inventor of the ’265 patent, not necessarily the sole inventor. Thus,
we refer to the decision as finding that Dr. Spievack is an inventor of the ’265 patent.
Even if the district court had made the determination that Dr. Spievack is the sole
inventor of the ’265 patent, we do not find that cross-appellants have raised a genuine
issue of material fact such that summary judgment on that issue would not have been
appropriately granted for essentially the same reasons discussed herein.
05-1458, -1558, -1559 25
rather than the period from 1994 through December 22, 1999, the date Dr. Spievack
filed the provision application which led to the ’265 patent. The premise of PRF’s
argument is that the district court erred in acting as though Dr. Spievack had
established that he was entitled to a priority date earlier than the December 22, 1999
date on which the application leading to the ’265 patent was filed. While Dr. Spievack
testified that he had completed his invention by the summer of 1996, PRF asserts that
the only other evidence offered as corroboration of Dr. Spievack’s alleged completion
was Dr. Spievack’s unwitnessed laboratory notebooks. PRF asserts that under our
precedent, unwitnessed notebooks are legally insufficient corroboration and that
therefore there is a genuine issue of material fact as to whether Dr. Badylak
communicated his work associated with basement membranes, described in the 1994
Disclosure,10 to Dr. Spievack between 1994 and December 22, 1999.
ACell responds to PRF’s appeal with several factual assertions: (1) there is no
evidence that Dr. Badylak communicated a contribution to Dr. Spievack’s invention
during the relevant time period, (2) PRF admitted under oath that Dr. Spievack is an
inventor of the ’265 patent, (3) the 1994 Disclosure does not reveal a basement
membrane composition, and (4) Dr. Badylak disavowed any role in the conception of
the invention claimed in the ’265 patent in his testimony and in a letter he sent to the
PTO.
10
In 1994, Dr. Badylak prepared and submitted an “Invention Record and
Disclosure” dated “8-17-94” (the “1994 Disclosure”) describing some of his work on
tissue graft compositions. The “Summary of Invention” section of the 1994 Disclosure
discussed a tissue graft including basement membrane and submucosa delaminated
from the transitional epithelial cell layer of the tunica mucosa.
05-1458, -1558, -1559 26
We agree with the district court that Dr. Spievack is an inventor of the ’265 patent
and that PRF has failed to raise a genuine issue of material fact that survives summary
judgment on the issue of whether Dr. Badylak is a joint inventor. Even if we were to
accept that the district court may have focused on a more narrow time period, we agree
with the district court that PRF has failed to point to evidence sufficient to create a
genuine issue of material fact that Dr. Badylak “contributed in some significant manner”
to the conception of the invention claimed in the ’265 patent. See BJ Servs., 338 F.3d
at 1373.
First, we do not read PRF’s brief as challenging the district court’s determination
that Dr. Spievack is an inventor of the ’265 patent. In fact, PRF admitted as much when
it represented that Dr. Spievack was a co-inventor in an application it submitted to the
PTO to provoke an interference with the ’265 patent.
Second, the only record evidence argued by PRF to create a genuine issue of
material fact is the 1994 Disclosure and Dr. Spievack’s testimony in which he stated that
“[Dr. Badylak] and I had talked about the basement membrane stuff somewhere along
in ’97 and ’98, because I know at some point I had told him about my―the studies I had
done in Boston with the dog bladders that we were talking about.” (Spievack Dep. 38:4-
7, Aug. 24, 2004.) Dr. Spievack’s testimony, however, is not sufficient to create a
genuine issue of material fact as to whether Dr. Badylak contributed “to the conception
of the claimed invention that is not insignificant in quality” by sharing his knowledge of
graft compositions, some of which is reflected in the 1994 Disclosure. See Eli Lilly &
Co. v. Aradigm, 376 F.3d 1352, 1358-59 (Fed. Cir. 2004). This is especially so in light
of Dr. Badylak’s disavowal of having conceived of, reduced to practice, or recognized
05-1458, -1558, -1559 27
the importance of a basement membrane graft composition. The district court also
correctly recognized that even accepting Dr. Spievack’s testimony as true, because of
the other deficiencies noted, it was insufficient to overcome the presumption that the
named inventors on an issued patent are presumed to be the actual inventors of that
patent, such that summary judgment was appropriate. Thus, the district court’s grant of
summary judgment finding that Dr. Badylak is not a co-inventor of the ’265 patent and
that Dr. Spievack is an inventor of the ’265 patent was proper.
Finally, with respect to PRF’s unjust enrichment claim, PRF has not presented
evidence to raise a genuine issue of material fact with respect to the district court’s
grant of summary judgment in ACell’s favor. Without a viable claim for unjust
enrichment, there is no basis for us to consider whether or not a constructive trust is an
appropriate remedy in this case. Thus, there is no reason to disturb the district court’s
judgment with respect to those issues.
III. CONCLUSION
Because the district court erred in construing the terms “urinary bladder
submucosa” and “the luminal portion of the tunica mucosa” which formed the basis for
the jury’s finding of infringement and because, under the correct construction of those
terms, there is no material factual dispute that the ACell Vet™ product cannot literally
infringe claims 1, 7, and 8 of the ’389 patent, we therefore reverse the judgment of
infringement. Further, because the ACell Vet™ product cannot infringe those claims
under the doctrine of equivalents without violating the “all limitations rule,” it is not
necessary to remand for a new trial on infringement under the doctrine of equivalents.
In addition, without a direct act of infringement, the judgment finding that Drs. Badylak
05-1458, -1558, -1559 28
and Spievack willfully induced ACell to infringe must also be reversed. Because of our
conclusion with respect to those issues, Cook’s appeal with respect to willfulness and
relief are moot. Finally, because the district court did not err in determining on summary
judgment that Dr. Badylak is not a co-inventor of the ’265 patent, that Dr. Spievack is an
inventor of the ’265 patent, and that PRF’s unjust enrichment claim and consequently its
requested remedy of a constructive trust, must fail, we affirm the district court’s rulings
on those issues.
COSTS
Each party shall bear its own costs.
AFFIRMED-IN-PART AND REVERSED-IN-PART
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