Jang v. Boston Scientific Corp.

532 F.3d 1330

G. David JANG, M.D., Plaintiff-Appellant, v. BOSTON SCIENTIFIC CORPORATION and Scimed Life Systems, Inc., Defendants-Appellees.

No. 2007-1385.

United States Court of Appeals, Federal Circuit.

July 15, 2008.

Thomas C. Mundell, Mundell, Odlum & Haws, LLP of Westlake Village, CA, argued for Plaintiff-Appellant.

Matthew M. Wolf, Howrey LLP, of Washington, DC, argued for Defendants-Appellees.

Before GAJARSA, LINN, and DYK, Circuit Judges.

DYK, Circuit Judge.

In this contract case, plaintiff G. David Jang, M.D., alleges that defendants, Boston Scientific Corporation ("Boston Scientific") and Scimed Life Systems Incorporated ("Scimed") breached a contract with Jang by failing to make required payments. The right to these payments depends on whether the sale of certain devices by Boston Scientific and Scimed were "covered by" (i.e., would have infringed) U.S. Patents No. 5,922,021 and 5,954,743 ("the '021 patent" and "the '743 patent," respectively), originally issued to Jang and later assigned to defendants. The district court issued a claim construction order, and the parties entered into a stipulation conceding that infringement could not be shown if the district court's claim constructions were upheld on appeal. The stipulation did not explain whether Jang's success on appeal in overturning any particular claim construction issue would, in fact, affect the infringement dispute. At oral argument Jang conceded that resolution of the dispute, at least as to one of the district court's claim constructions, would not affect infringement, and defendants appeared to agree. Moreover, even as to those claim construction rulings that could affect infringement, it is not clear how the claim constructions would render the accused products infringing or noninfringing. As a result of the ambiguity both as to which claim construction rulings affect infringement and as to how those rulings relate to the accused product, we vacate the judgment and remand to the district court for clarification.

BACKGROUND

Jang is the named inventor of the '021 and '743 patents, relating to the design or architecture of intravascular stents, tube-shaped mesh devices used to treat certain forms of cardiac disease. Intravascular stents are inserted in a blood vessel and then expanded (usually by use of a balloon catheter) to prop open a blocked or weakened section of the vessel. In particular, the patents relate to the particular patterns of repeated shapes that make up the stents and that allow them, among other things, to exhibit radial strength when expanded, to be adequately flexible during insertion, and to avoid foreshortening in length during expansion. See '021 patent, col. 3, ll.23-46; '743 patent, col.3, ll.13-34.

Through a contract executed in 2002, Jang assigned the '021 and '743 patents to Boston Scientific and Scimed. In exchange, Boston Scientific and Scimed agreed to pay $50 million immediately and agreed to pay an additional amount (up to $110 million) based on the sales of commercial products covered by the assigned patents if such products were produced, or a noncommercialization payment of $10 million if such products were not produced. Boston Scientific and Scimed developed and sold several stent designs that they asserted were not covered by the assigned '021 and '743 patents, and paid Jang only the initial $50 million payment and the $10 million noncommercialization fee.

Jang filed his initial complaint in this action in the District Court for the Central District of California on May 19, 2005. Boston Scientific and Scimed answered and counterclaimed, and Jang filed a First Amended Complaint in March 2006. Jang's First Amended Complaint asserted, as the third alternative claim for relief, a claim for breach of contract against defendants. Jang's breach of contract claim asserted that four models of commercial intravascular stents sold by Boston Scientific and Scimed were "covered by" either or both of the '021 and '743 patents (i.e., would infringe the patents), and thus that Jang was entitled to an additional payment of $100 million under the assignment agreement.¹ The parties' briefs on appeal neglect to advise us which claims are asserted against the accused products. The district court held a claim construction hearing on May 30, 2006. By apparent agreement of the parties, the claim construction hearing focused on terms used in claim 1 of each of the asserted patents.

The district court issued a claim construction order on August 24, 2006, construing the contested claim terms: "expansion column," "connecting strut column," "connecting strut," "expansion strut," "expansion strut pair," "proximal," "distal," and "radius of curvature."

After the district court's claim construction order was issued, the parties entered a stipulation, agreeing that under the district court's claim construction, Jang could not prove that the accused products were "covered by" (i.e., infringed) the asserted patents. Accordingly, the parties agreed that partial summary judgment in favor of Boston Scientific and Scimed should be entered on Jang's breach of contract claim. The stipulation expressly preserved Jang's ability to challenge the claim construction order on appeal. The stipulation did not explain why the district court's claim construction resulted in non-liability, other than to state that, "under the Court's existing Claim Construction Order, Dr. Jang cannot prove that the Express stent is covered by any claims of U.S. Patent Nos 5,922,021 and 5,954,743. . . ." J.A. at 19.² On September 18, 2006, the district court entered partial summary judgment as to the breach of contract claim based on the parties' joint stipulation requesting this disposition. The judgment did not explain how any of the disputed claim construction rulings related to the accused devices.

This judgment was not yet final as to all claims, however, as other claims and counterclaims remained outstanding. On January 30, 2007, the district court entered partial summary judgment in favor of defendants as to two of Jang's claims seeking rescission of the agreement with respect to the ownership of certain other patents relating to balloon angioplasty that originally issued to Jang. On May 8, 2007, the district court signed a proposed consent judgment drafted by the parties which incorporated the two prior judgments into a final judgment and granted declaratory relief that the disputed balloon angioplasty patents "are not within the scope of Dr. Jang's assignment obligations to [Boston Scientific] under any current or past agreement between the parties." J.A. at 29. The consent judgment also preserved Jang's right to appeal the district court's claim construction rulings with respect to the '021 and '743 patents, and preserved Jang's "right to pursue his breach of fiduciary duty and rescission claims in the event the Court of Appeals reverses or vacates [the district court's] claim construction order." Id. at 30.³

Jang timely appealed from the final consent judgment, challenging only the district court's claim construction with respect to the '021 and '743 patents. At oral argument on appeal, counsel for plaintiff admitted that resolution of at least one of the claim construction disputes would not affect the issue of infringement.⁴ Defendants also acknowledged that the dispute as to whether "expansion column" includes a "vertical" or "tubular" requirement "is not crucial here" and would not affect the issue of infringement. Br. of Defendants-Appellees at 29 n. 5. Counsel for defendants again admitted at oral argument that that he did not consider resolution of this dispute relevant to the issue of infringement. Oral Argument at 34:50-35:04 ("[A]s to tubular, as I believe we suggested in our brief, we do not think that is a material dispute and we would not have addressed it [if Jang had not]. . . ."). We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(1).⁵

DISCUSSION

I

It is clear that a judgment entered based on a stipulation of the parties may in appropriate circumstances be reviewed on appeal. Indeed, this court has reviewed stipulated judgments based on claim construction when the judgments were entered with the express purpose of obtaining appellate review of the claim construction. See, e.g., Oatey Co. v. IPS Corp., 514 F.3d 1271, 1276 (Fed.Cir.2008); Ventana Med. Sys., Inc. v. Biogenex Labs., Inc., 473 F.3d 1173, 1177 (Fed.Cir.2006); Generation II Orthotics Inc. v. Med. Tech. Inc., 263 F.3d 1356, 1363 (Fed.Cir.2001); Interactive Gift Express, Inc. v. Compuserve Inc., 256 F.3d 1323, 1330 (Fed.Cir. 2001). However, a consent judgment must satisfy the same standards of appellate jurisdiction as any other judgment entered by the district court. See, e.g., United States v. Procter & Gamble Co., 356 U.S. 677, 680-81, 78 S.Ct. 983, 2 L.Ed.2d 1077 (1958). A judgment is reviewable only if it is possible for the appellate court to ascertain the basis for the judgment challenged on appeal.

The Supreme Court has recognized the authority to remand for clarification judgments that suffer from ambiguity, particularly when the ambiguity implicates jurisdictional concerns. See, e.g., Bush v. Palm Beach County Canvassing Bd., 531 U.S. 70, 78, 121 S.Ct. 471, 148 L.Ed.2d 366 (2000) (remanding because there was "`considerable uncertainty as to the precise grounds for the decision[ ]'" from which the appeal was taken (quoting Minnesota v. Nat'l Tea Co., 309 U.S. 551, 555, 60 S.Ct. 676, 84 L.Ed. 920 (1940))); see also Dennison Mfg. Co. v. Panduit Corp., 475 U.S. 809, 811, 106 S.Ct. 1578, 89 L.Ed.2d 817 (1986) (remanding for clarification due to the "lack [of] an adequate explanation of the basis for the Court of Appeals' judgment"). The Courts of Appeals in general and our court in particular have recognized that a remand for clarification is appropriate where a judgment is ambiguous.⁶

II

In this case, the consent judgment under review suffers from two...