Federal Circuit Affirms $371 Million Judgment Against W.L. Gore
By Michael Hoven – Edited by Matt Gelfand
Bard Peripheral Vascular, Inc. v. W.L. Gore & Assocs., No. 2010-1050 (Fed. Cir. Feb. 10, 2012)
The Court of Appeals for the Federal Circuit affirmed a decision from the District of Arizona, which upheld a jury verdict that W.L. Gore & Associates’s employee had not jointly invented a vascular graft patented by Bard Peripheral Vascular, and that Gore had willfully infringed Bard’s patent. In addition, the Federal Circuit affirmed the lower court’s award of enhanced damages of $371 million, plus attorneys’ fees, costs, and an ongoing royalty to Bard.
The Federal Circuit held that there was substantial evidence to support the jury’s finding of willful infringement and that the district court had not abused its authority in awarding enhanced damages, fees, costs, and a royalty to Bard. Although Gore’s employee had supplied tubes of the substance ePTFE to the inventor behind the Bard patent so that ePTFE could be tested for suitability in vascular grafts, the court reasoned that the inventor of the Bard patent had the key insight into exactly how to fabricate ePTFE into successful vascular grafts, which was not anticipated by the work of Gore or other researchers investigating the use of ePTFE in such grafts. Further, the court rejected Gore’s argument that its employee was a joint inventor, pointing to evidence that the inventor of graft reduced the invention to practice without assistance from Gore. In so holding, the court stated that a researcher, if provided with a material to investigate a possible application, can claim an invention in his or her insight into the precise characteristics that make the material suitable for the application.
Bloomberg provides an overview of the case. The Patent Prospector says the patent at issue and its decades-long legal battle demonstrate that the patent system is broken. IP Biz noted the sharp exchange of words between the majority and the dissent. Peter Cooper, a plant manager for Gore, distributed ePTFE tubes to various researchers in the early 1970s to see if they could be used in vascular grafts. (Gore would go on to famously market ePTFE under the brand name Gore-Tex.) The ePTFE tubes consisted of solid nodes of ePTFE connected by thin fibers of ePTFE. Cooper discovered that tubes with a certain fibril length—five to ten microns—were suitable for vascular grafts, and filed a patent application in April 1974. However, one of the researchers who had received ePTFE tubes from Cooper, David Goldfarb, had also discovered that vascular grafts could be made using tubes of that fibril length, and filed for a patent in October 1974. In an earlier proceeding, the Federal Circuit concluded that Goldfarb had priority of invention because Cooper only conceived of the invention after sending the tubes to Goldfarb, and Goldfarb had reduced the conception to practice first. In 2002, a patent issued on Goldfarb’s invention, and Bard sued Gore the following year. In the majority opinion, the court stated that the invention was not the general idea of using ePTFE in a vascular graft, but the discovery of the specific fibril length that made ePTFE suitable in a vascular graft. The court reasoned that because Cooper and Goldfarb did not communicate or collaborate regarding any tests on the tubes or the importance of fibril length, Cooper did not make a significant contribution to Goldfarb’s invention, and thus did not meet the requirement to be a joint inventor.
Judge Newman dissented, accusing the majority opinion of “ratif[ying] . . . [an] insult to the judicial process.” The dissent called for a new trial, at a minimum, reasoning that Gore could not infringe Bard’s patent because it possessed ePTFE and conceived of using it in vascular grafts before it distributed the tubes to Goldfarb. In addition, the dissent noted that other researchers had experimented with using ePTFE in vascular grafts and some results had been published, and argued that this anticipated Bard’s patent. The dissent raised the fear that the majority decision could complicate and disrupt routine practices of letting researchers test proprietary materials.
This case represents the culmination of a 28-year-long dispute, and this long period of uncertainty—during which Gore continued to produce grafts using ePTFE—contributed to the staggering damages figure. This epic litigation suggests that the patent system is not functioning at optimal efficiency. Even more worrisome, the outcome arrived at by the Federal Circuit could, as the dissent notes, interfere with research and testing practices and thereby delay the discovery and development of medical advances.