June 18 (Reuters) - Chances are that any given juror in a
patent case has never before and will never again have to decide
a similar legal dispute. But because jurors sit through patent
trials and weigh the evidence they've heard, they've always been
charged with determining not only whether the plaintiff has a
valid patent that the defendant has infringed but also whether
the defendant's infringement was willful.
As of Thursday, that's no longer the case.
In a new appellate ruling in C.R. Bard v. W.L. Gore &
Associates, the Federal Circuit Court of Appeals wrested some of
that discretion away from jurors and placed it in the hands of
the federal judges who oversee patent disputes. The judge is in
the best position to determine whether a defendant's conduct was
reasonable, the court concluded.
The 38-year-old (yes, 38-year-old) Bard case has a long and contorted history. Just last February, a divided three-judge
panel of the Federal Circuit affirmed a $186 million jury
verdict against Gore-Tex maker W.L. Gore for willful
infringement, as well as post-trial rulings that doubled the
damages. It also tacked on $19 million in attorneys' fees, and
added a 12.5 percent to 20 percent royalty for Gore's ongoing
infringement of C.R. Bard's patent on vascular stents. That
brought the grand total of what Gore owed Bard to between $800
million and $900 million -- one of the largest patent awards
ever affirmed by the Federal Circuit.
But the panel backtracked last week, after the en banc court
called for reconsideration. On appeal, Gore had argued that the
company's own plant manager had come up with the idea for using
Gore-Tex as a possible prosthetic blood vessel and was at least
a co-inventor. What's more, Bard's patent was pending for 28
years, which raised doubts as to its validity.
The divided Federal Circuit panel concluded that trial judge
Mary Murguia (then a U.S. district judge in Arizona, now a
member of the 9th Circuit) used the wrong test to determine
whether Gore's alleged infringement was willful or not. Instead
of reviewing whether the jury had enough evidence to find
willfulness, she should have first determined on her own whether
Gore's actions were objectively reckless. In other words, was
Gore being reasonable in assuming that it was not infringing
"The objective determination of recklessness, even though
predicated on underlying mixed questions of law and fact, is
best decided by the judge as a question of law subject to de
novo review," Judge Arthur Gajarsa wrote for the two-judge
Paul Clement of Bancroft had filed an amicus brief on behalf
of Verizon, Google and Intel supporting Gore's request for a
rehearing en banc. John Thorne, Verizon's general counsel,
welcomed the panel's decision to make willfulness a question of
law for the judge. "This result will better achieve patent law's
aims by promoting innovation," he said in a statement.
But the result exposes a perennial tension in patent
litigation over who should have decision-making authority: the
jury or the judge?
"It's harder to persuade a lay jury that the patent office
made a mistake than it is to convince a federal district judge
that the patent office made a mistake. Therefore, the allocation
of authority really matters," said James Dabney, who heads Fried
Frank's IP practice.
The latest decision reflects a broader trend of shifting
that authority into the hands of the judge that started with the
1996 case Markman v. Westview Instruments, when the Supreme
Court ruled that judges, not juries, would decide what the words
used in patent claims meant. The same fight has also been
brewing over other elements of patent law, including the
requirements of non-obviousness and the sufficiency of a claim's
written description -- both of which still lie with the jury.
Frank Porcelli of Fish & Richardson, who represented Gore,
declined to comment. Bard counsel John O'Quinn of Kirkland &
Ellis did not respond to a request for comment.
(Reporting by Terry Baynes)
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