Medgraph, Inc. v. Medtronic, Inc.

111 F.Supp.3d 346

MEDGRAPH, INC., Plaintiff,

v.MEDTRONIC, INC., Defendant.

No. 09–CV–6610L.

United States District Court, W.D. New York.

Signed June 29, 2015.

Dariush Keyhani, Sidney R. Bresnick, Meredith & Keyhani, PLLC, New York, NY, for Plaintiff.

Azar Mouzari, Wayne Barsky, Gibson Dunn & Crutcher LLP, Los Angeles, CA, Eric J. Ward, Jeffrey J. Harradine, Ward Greenberg Heller & Reidy LLP, Rochester, NY, for Defendant.

DECISION AND ORDER

DAVID G. LARIMER, District Judge.

Patent litigation often involves complex, abstruse matters, since the patents at issue often relate to cutting-edge technology. The case law governing such litigation can be similarly complex. This case is one example.

This case involves two patents concerning technology relating to health care. Many of the legal issues involved center on a particular case that has worked its way to the Federal Circuit and the Supreme Court, and back again to the Federal Circuit: Akamai Technologies, Inc. v. Limelight Networks, Inc. ("Akamai "). The lengthy history of this litigation is set forth in detail below, and involves appeals, remands, one en banc decision, and more than one split decision among the deciding judges.

Despite that extensive history, the relevant, controlling law on the issues presented in the instant case is clear. Based on that authority, and the facts of this case, defendant's motion for summary judgment must be granted. The complaint is therefore dismissed.

BACKGROUND

Medgraph is a New York corporation, which, according to the complaint, is "in the business of commercializing its patented inventions by offering for sale and licensing to third parties the methods and systems claimed in its patents...." Dkt. # 26 ¶ 2. Defendant Medtronic states that it "develops, manufactures, and markets a variety of medical devices and systems including therapies and solutions for ... diabetes...." Defendant's Statement of Undisputed Material Facts (Dkt. # 135–1) ¶ 15.

The two patents in suit, which are owned by plaintiff, are U.S. Patents No. 5,974,124 ("'124 Patent") and No. 6,122,351 ("'351 Patent"). Both patents are entitled "Method and system aiding medical diagnosis and treatment." The ' 351 Patent is a continuation in part of the '124 Patent. Both patents relate to the electronic collection and storage of patient data, and the transmission of such data to physicians and other health care professionals. Id.

The '124 and '351 patents both claim a "method for improving and facilitating diagnosis and treatment of patients having medical conditions requiring long-term profiles of specific variables...." The '124 Patent sets forth fifteen method claims, numbered 1–15, as well as a system claim, numbered claim 16. The '351 Patent contains a single method claim.¹ In many respects, the two patents share nearly identical language, and the '351 method claim mostly tracks the language of Claim 1 of the '124 patent ; to the extent that they differ, those differences are not materially significant for purposes of this Decision and Order.

In layman's terms, both patents relate to a method whereby medical practitioners or patients take readings of certain variable data (such as diabetes patients' blood sugar levels), input the data into a computer, and transmit the data to a central storage device, from which the data can be accessed by medical professionals who have been treating the patient. The ' 124 patent also claims a system that allows that method to be performed.

In other words, the method and system claimed by the patents enable patients and their physicians to store patients' medical data in a way that allows them, as well as other physicians and medical personnel, to access that data from a remote location, using a computer.

More specifically, Claim 1 of the '124 Patent claims:

A method for improving and facilitating diagnosis and treatment of patients having medical conditions requiring long-term profiles of specific variables, said method including the steps of

using at least one measuring device, periodically taking a measurement of at least one medically important variable that has been identified for a patient from a body of said patient;

ensuring said patient is separated from said at least one measuring device after taking each said measurement;

inputting said at least one medically important variable as raw data into a primary computer system after said step of ensuring said patient is separated and recording said raw data in a mass storage device integrated with said primary computer system;

compiling said raw data as data for said patient using the primary computer system, said data representing a history of values for said at least one medically important variable for said patient;

receiving a request for data of one of said patients from by a medical practitioner that is treating said one of said patients; and

outputting requested data for said one of said patients in the form of at least one of a chart and a graph to said medical practitioner;

said step of inputting comprising one of

transferring said raw data to a remote computer comprising an ordinary general purpose personal computer, then transferring said raw data to said primary computer;

telephoning an automatic telephone interface and employing one of speech recognition and touch-tone recognition software to input said raw data into said primary computer; and

telephoning a live receptionist, speaking the raw data to said live receptionist for entry into said primary computer.

Dkt. # 26–1 at 8. The '351 Patent sets forth a similar claim, with some differences that need not be elaborated upon here. See Dkt. # 26–2 at 9.

Claim 16 of the '124 Patent claims a "system for improving and facilitating diagnosis and treatment of patients having medical conditions requiring long-term profiles of at least one predetermined medically important variable...." Dkt. # 26–1 at 9, col. 10, lines 24–27. That claimed system allows the method claimed in Claims 1–15 to be performed.

What is alleged to infringe here is Medtronic's "CareLink System," a software-and internet-based system in which diabetes patients can upload blood glucose readings to Medtronic's central computer, which is located in Minnesota. Those readings can then be converted into graphs and charts that are accessible by both the patient (as part of Medtronic's "Carelink Personal" system) and the patient's physician (as part of the "Carelink Pro" system).

The amended complaint (Dkt. # 26) sets forth six counts: (1) direct infringement of Claims 1, 2, 3, 5, 11 and 16 of the '124 Patent ; (2) induced infringement of those claims in the '124 Patent ; (3) contributory infringement of those claims in the '124 Patent ; (4) direct infringement of the '351 Patent ; (5) induced infringement of the '351 Patent ; and (6) contributory infringement of the '351 Patent.

DISCUSSION

I. General Principles

A. Direct Infringement

Section 271(a) of the Patent Act, 35 U.S.C. § 271(a), provides that "whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent." Such infringement is commonly referred to as "direct" infringement.

All but one of the claims at issue in this case are "method" claims. "A ‘method’ in a claim, one of the most common and basic terms of patent drafting, is a ‘process,’ and ‘method’ and ‘process' have a clear, settled meaning: a set of actions, necessarily taken over time." Nassau Precision Casting Co., Inc. v. Acushnet Co., Inc., 566 Fed.Appx. 933, 939 (Fed.Cir.2014) (citations omitted).

"To [directly] infringe a method claim, a person must have practiced all steps of the claimed method." Lucent Technologies, Inc. v. Gateway, Inc., 580 F.3d 1301, 1317 (Fed.Cir.2009), cert. denied, 560 U.S. 935, 130 S.Ct. 3324, 176 L.Ed.2d 1240 (2010). A single actor-either the defendant or someone acting under the defendant's direction or control—must perform each step of the claimed method. See Aristocrat Technologies Australia Pty Ltd. v. International Game Technology, 709 F.3d 1348, 1353 (Fed.Cir.2013) ("direct infringement requires a single party to perform every step of a claimed method"); Medisim Ltd. v. BestMed LLC, 910 F.Supp.2d 591, 625 (S.D.N.Y.2012) ("In order to directly infringe a method claim, a party must perform every claimed step") (citing Joy Techs., Inc. v. Flakt, Inc., 6 F.3d 770, 773 (Fed.Cir.1993) ).

With respect to system claims, a party may be held liable for direct infringement only if the party makes or sells the "complete invention." Rotec Indus., Inc. v. Mitsubishi Corp., 215 F.3d 1246, 1252 n. 2 (Fed.Cir.2000). In addition, "[t]o prove literal infringement, the patentee must show that the accused device contains each and every limitation of the asserted claims." Ericsson, Inc. v. D–Link Systems, Inc., 773 F.3d 1201, 1215 (Fed.Cir.2014) (quoting Presidio Components, Inc. v. Am. Tech. Ceramics Corp., 702 F.3d 1351, 1358 (Fed.Cir.2012) ). See also Icon–IP Pty Ltd. v. Specialized Bicycle Components, Inc., 87 F.Supp.3d 928, 955, 2015 WL 1476399, at *16 (N.D.Cal. Mar. 31, 2015) ("To establish literal infringement, all of the elements of the claim, as correctly construed, must be present in the accused system") (quoting Netword, LLC v. Centraal Corp., 242 F.3d 1347, 1353 (Fed.Cir.2001) ).

B. Indirect Infringement

In addition to direct infringement, the patent statutes also create liability for so-called indirect infringement, which generally falls into two categories: induced and contributory infringement. Both types are alleged here, both as to the method claims and the one system claim.

Subsection (b) of 35 U.S.C. § 271 provides that "[w]hoever actively induces infringement of a patent shall be liable as an infringer." "In contrast to direct infringement, liability for inducing infringement attaches only if the defendant knew of the patent and that ‘the induced acts constitute patent...