Roche Diagnostics Corp. v. Meso Scale Diagnostics, LLC

503 F.Supp.3d 156

ROCHE DIAGNOSTICS CORPORATION, Plaintiff,

v.MESO SCALE DIAGNOSTICS, LLC, Defendant.

Meso Scale Diagnostics, LLC, Counterclaim-Plaintiff,

v.Roche Diagnostics Corporation and BioVeris Corporation, Counterclaim-Defendants.

C.A. No. 17-189-LPS

United States District Court, D. Delaware.

Filed November 30, 2020

Joel Friedlander, Christopher Foulds, FRIEDLANDER & GORRIS, P.A., Wilmington, DE, James T. McKeown, Jefferey N. Costakos, Eric L. Maasen, Kimberly K. Dodd, Rachel M. Blise, Phillip C. Babler, FOLEY & LARDNER, LLP, Milwaukee, WI, Attorneys for Roche Diagnostic Corporation and BioVeris Corporation.

Jack B. Blumenfeld, Jeremy A. Tigan, MORRIS, NICHOLS, ARSHT & TUNNELL LLP, Wilmington, DE, Steven E. Derringer, Anastasiya Maione, BARLITT BECK LLP, Chicago, IL, John M. Hughes, Nosson D. Knobloch, Daniel C. Taylor, BARLITT BECK LLP, Denver, CO, Attorneys for Meso Scale Diagnostics, LLC.

MEMORANDUM OPINION

STARK, U.S. District Judge:

Beginning on November 12, 2019, the Court held a six-day jury trial in this contract and patent-related infringement action. (See D.I. 296, 297, 298, 299, 300, 301, 302) ("Tr.")¹ The jury returned a verdict in favor of Meso Scale Diagnostics, LLC ("Meso" or "Plaintiff"), finding that Roche Diagnostics Corp. ("Roche") and BioVeris Corp. ("BioVeris") (collectively "Defendants") willfully infringed and/or induced infringement of U.S. Patent No. 6,808,939 ("the ’939 patent") claim 33, U.S. Patent No. 5,935,779 ("the ’779 patent") claim 1, and U.S. Patent No. 6,165,729 ("the ’729 patent") claims 38 and/or 44 – claims with respect to which the jury also found Meso had exclusive licenses. (D J. 276) The jury awarded Meso damages of $137,250,000. (Id. )

Pending before the Court are the parties’ various post-trial motions. (D.I. 287, 290) The parties submitted extensive briefing and related materials. (See D.I. 288-89, 291, 303-05, 307-08) The Court heard telephonic oral argument on May 6, 2020. (D.I. 315) ("Arg. Tr.")

I. BACKGROUND

This case involves patents for electrochemiluminescence (or ECL) technology that were once owned by IGEN International, Inc. ("IGEN") and are now owned by BioVeris. ECL is a kind of luminescence in which light is produced during electrochemical reactions in a solution. (D.I. 238 Ex. 1 at ¶ 15) (Pretrial Order Uncontested Facts) ("UF") One application of ECL is for the detection and quantification of specific substances in a test sample. (Id. )

IGEN was founded in 1982 by its CEO Samuel Wohlstadter and two business partners. (UF ¶ 16) In 1992, IGEN entered into a license agreement (the "1992 License") authorizing Boehringer Mannheim GmbH ("Boehringer") to develop, use, manufacture, and sell ECL assays and instruments limited to a specific "Field": "use in hospitals (except where the performance of the Assay takes place at the side of the patient), blood banks and clinical reference laboratories." (UF ¶ 18) In 1998, Roche purchased Boehringer, so Roche became the licensee under 1992 License. (D.I. 153 at 1-2) Beginning in 1994, IGEN and Roche had been selling ECL instruments. (Id. at 2)

At around the same time, Jacob Wohlstadter, the son of IGEN's CEO, was researching multi-array methodologies at another entity, Meso Scale Technologies ("MST"). (D.I. 153 at 2) In 1995, IGEN and MST signed a Joint Venture Agreement ("JVA") and formed Meso Scale Diagnostics, LLC – the party to this litigation (and the party referred to in this Memorandum Opinion as "Meso"). (UF ¶ 19; P11) The JVA provided that "MST and IGEN have jointly prepared a Research Outline for a program of research and development (the ‘Research Program’) to be conducted by" Meso. (P11 at *546) The Recitals section in the JVA further provided that Meso was "organized for the purpose of conducting this research and development and, if successful, developing, manufacturing, marketing and selling products, processes, and services." (Id. ) Under the JVA, MST contributed to Meso an exclusive license to its intellectual property while IGEN contributed an exclusive license, significant financial investment, office and laboratory facilities, and research personnel. (D.I. 153 at 2)

Attached to the JVA was a license agreement between IGEN and Meso ("the 1995 License"). (UF ¶ 20; P12) Section 2.1 of the 1995 License grants to Meso "an exclusive, worldwide, royalty-free license to practice the IGEN Technology to make, use, and sell products or processes (A) developed in the course of the Research Program, or (B) utilizing or related to the Research Technologies." (UF ¶ 20; P12 at *678)

"IGEN Technology" is defined in Section 1.3 of the 1995 License as "all inventions, know-how, methods, procedures and other technology, whether or not patented or patentable, now or hereafter owned by, licensed to, or otherwise obtained by, IGEN ... including IGEN Technology, and rights under all patents and patent applications relating to the foregoing." (P12 at *677-78) The "IGEN Technology" that Meso may practice includes the patents that Meso is asserting against Roche in this case. (UF ¶ 20)

"Research Technologies" is defined in Section 1.11 of the JVA as "(i) selection and screening methods, ... (ii) modified electrodes, ... and (iii) multi-array diagnostic ... ‘Research Technologies’ specifically include, but are not limited to, ... agents to extend the electrical potential of an electrode in the direction perpendicular to its surface ...." (P11 at *547)

On July 24, 2003, IGEN and Roche executed a new license agreement (the "2003 License") to give Roche a non-exclusive license to IGEN's ECL technology limited to the specific field of human patient diagnostics. (See UF ¶ 22; D.I. 153 at 3-4; P44 at *865-66) Meso consented to the 2003 License, and consented to and joined in the licenses granted by it. (UF ¶ 23) As part of the 2003 transaction, IGEN's patent and other intellectual property as well as IGEN's ownership interest in the Meso joint venture were transferred to a new company: BioVeris. (UF ¶ 25) Shareholders of IGEN stock received shares of Bio Veris stock. (Id. ) In 2007, a Roche affiliate acquired BioVeris and its 100+ patents for about $600 million. (See UF ¶ 26)

In June 2010, Meso sued Roche in the Delaware Court of Chancery. (See D.I. 153 at 4) Meso claimed, among other things, that Meso was a party to the 2003 License and had a right to enforce its provisions. (See D.I. 99 at 7) Following a one-week bench trial in early 2013, Vice Chancellor Parsons concluded that Meso had consented to but was not a party to the 2003 License Agreement between IGEN and Roche, and further that only BioVeris (as IGEN's successor-in-interest) could enforce the 2003 License Agreement against Roche for sales made outside the field defined in the 2003 License. See Meso Scale Diagnostics, LLC v. Roche Diagnostics GmbH , 2014 WL 2919333 (Del. Ch. June 25, 2014). In June 2015, the Delaware Supreme Court affirmed the Chancery decision. See Meso Scale Diagnostics, LLC v. Roche Diagnostics GmbH , 116 A.3d 1244 (Table) (Del. 2015).

Roche filed the instant action in this Court on February 22, 2017, seeking a declaration "confirming that Roche does not infringe any license rights of defendant Meso in a patented diagnostics detection technology known as electrochemiluminescence." (D.I. 1 ¶¶ 1, 30-39) In response, in April 2017, Meso filed counterclaims, including for patent infringement and breach of the 1995 License between IGEN and Meso. (D.I. 10) This case has been heavily litigated, resulting in, inter alia , decisions on motions for summary judgment and Daubert motions (see, e.g. , D.I. 153, 219, 235), and culminating in the November 2019 jury trial and the pending post-trial motions.

II. LEGAL STANDARDS

A post-trial motion for judgment as a matter of law ("JMOL") is appropriate if "the court finds that a reasonable jury would not have a legally sufficient evidentiary basis to find for a party on an issue." Fed. R. Civ. P. 50(a)(1). "Entry of judgment as a matter of law is a sparingly invoked remedy," one "granted only if, viewing the evidence in the light most favorable to the nonmovant and giving it the advantage of every fair and reasonable inference, there is insufficient evidence from which a jury reasonably could find liability." Marra v. Phila. Hous. Auth. , 497 F.3d 286, 300 (3d Cir. 2007) (internal quotation marks omitted).

To prevail on a renewed motion for judgment as a matter of following a jury trial, the moving party "must show that the jury's findings, presumed or express, are not supported by substantial evidence or, if they were, that the legal conclusion implied [by] the jury's verdict cannot in law be supported by those findings." Pannu v. Iolab Corp. , 155 F.3d 1344, 1348 (Fed. Cir. 1998) (internal quotation marks omitted). " ‘Substantial’ evidence is such relevant evidence from the record taken as a whole as might be accepted by a reasonable mind as adequate to support the finding under review." Perkin-Elmer Corp. v. Computervision Corp. , 732 F.2d 888, 893 (Fed. Cir. 1984).

In assessing the sufficiency of the evidence, the Court must give the non-moving party, "as [the] verdict winner, the benefit of all logical inferences that could be drawn from the evidence presented, resolve all conflicts in the evidence in his favor, and in general, view the records in light most favorable to him." Williamson v. Consol. Rail. Corp. , 926 F.2d 1344, 1348 (3d Cir. 1991) ; see also Perkin-Elmer Corp. , 732 F.2d at 893. The Court may not assess the credibility of witnesses nor "substitute its choice for that of the jury between conflicting elements of the evidence." Id. Rather, the Court must determine whether the evidence reasonably supports the jury's verdict. See Dawn Equip. Co. v. Ky. Farms Inc. , 140 F.3d 1009, 1014 (Fed. Cir. 1998) ; Gomez v. Allegheny Health Servs. Inc. , 71 F.3d 1079, 1083 (3d Cir. 1995) (describing standard as "whether there is evidence upon which a reasonable jury could properly have found its verdict"); 9B ...