DC decisions of induced infringement of patent asserted by Meso and non-infringement of non-asserted patents as requested by Roche vacated and remanded

Roche Diagnostics Corp., Bioveris Corp. v. Meso Scale Diagnostics, LLC

Docket No. 2021-1609, -1633 (https://cafc.uscourts.gov/opinions-orders/21-1609.OPINION.4-8-2022_1933410.pdf)

NEWMAN (D), PROST, TARANTO

April 8, 2022

Brief Summary:   DC findings of induced infringement of patents asserted by Meso and non-infringement of non-asserted patents as requested by Roche vacated and remanded.  Judge Newman’s dissent argued, e.g., “Roche cannot infringe patents it owns”.

Summary:  Roche and Bioveris (Roche) appealed final DC decision that Roche infringed Meso’s exclusive license rights and award of damages.  Meso cross-appealed the DC’s non-infringement decision regarding three other patents that were not asserted against Roche. The patents relate to electrochemiluminscence (ECL) technologies to which Meso obtained rights through a 1995 “Research Program” (RP) and license agreement with IGEN.  Roche obtained a field-restricted license with IGEN when it purchased Boehringer Mannheim GmbH that had that license.  Roche’s license also “permitted sales that resulted in incidental out-of-field use” in exchange for payments to IGEN.  IGEN then transferred the disputed ECL patents to BioVeris which was subsequently acquired by Roche which “began selling the products without field restrictions”.  Meso sued Roche in 2010 alleging Roche breached the 2003 license with IGEN by violating the field restriction but that court found that “Meso was not a party to the 2003 license agreement, such that only BioVeris (as IGEN’s successor-in-interest) could enforce the field restriction.”  In 2017, Roche brought the current suit seeking a declaratory judgment (DJ) that it does not infringe Meso’s rights arising from the Research Program.  The jury that Roche willfully infringed Meso’ exclusive rights and awarded Meso over $137 million in damages and that court determined Roche did not infringe three other non-asserted patents.  While the parties disputed the meaning of “developed” in Meso’s license agreement, the FC panel did not reach a conclusion on that point as it reversed the induced-infringement of the patents that predated the RP finding on other grounds but not the patent that does not predate the RP.  On induced infringement, Roche argued “that the district court in denying JMOL ‘incorrectly applied a negligence standard rather than requiring specific intent for inducement’” and the FC panel agreed and vacated the damages award (Global-Tech, US 2011; Commil, FC 2013; Takeda, FC 2015 (“not acts of inducement where, as here, the products have both in-field (non-infringing) and out-offield (infringing) applications); Standard Oil, FC 1995 not a “‘continuing-impact’ standard”); Omega, FC 2021 (“damages attributable to the infringing features”); Commonwealth, FC 2015 “separate the value of the allegedly infringing features from the value of all other features”)).  The FC panel also vacated the noninfringement finding as to the non-asserted patents as “the best understanding of the compulsory-counterclaim rule is that it bars future claims but does not authorize rendering adverse judgment on such claims in the same action” (FRCP 13; Baker, US 1974).  Judge Newman’s dissent argued that, e.g., “Roche cannot infringe patents it owns” and there is “undisputed evidence of MSD’s acceptance of Roche’s rights” (ConocoPhillips, FC 2007).