09/23/14

Medisim v. Bestmed: JMOL on Anticipation and Unjust Enrichment

Category: Civil Procedure 
 
 
 
 By: Karthik Subramanian, Contributor 
 
TitleMedism Ltd. v. Bestmed, LLC, No. 2013-1451 (Fed. Cir. July 14, 2014).
Issue“This appeal concerns Medisim’s challenges to the district court’s grant of JMOL on anticipation and unjust enrichment. Medisim argues that BestMed forfeited its right to JMOL under Rule 50(b) for both claims when it failed to properly move for JMOL under Rule 50(a) at the close of evidence. Medisim also challenges the district court’s grant of JMOL on anticipation and unjust enrichment on the merits. Finally, Medisim argues that the district court abused its discretion by granting a conditional new trial on anticipation. We address each of Medisim’s challenges in turn.”
Medisim at *6.
Holding“Because BestMed failed to preserve its right to JMOL on anticipation under Federal Rule of Civil Procedure 50, we vacate the district court’s grant of JMOL on that claim. However, we affirm the district court’s grant of JMOL on Medisim’s unjust enrichment claim and its conditional grant of a new trial on anticipation. We remand this case for further proceedings.”
Medisim at *2.
 
 
Procedural HistoryBestMed expressly moved for JMOL under Rule 50(a) of no unjust enrichment at the close of Medisim’s case-in-chief, generally contending that “[t]here is no evidence of unjust enrichment” and particularly challenging Medisim’s evidence on each element of the claim. [...]The district court denied all JMOL motions, and the jury found the ’668 patent to be not invalid and infringed. [...] The jury awarded Medisim $1.2 million in patent infringement damages and $2.29 million in damages for its unjust enrichment claim. [...] Following the jury verdict, BestMed moved for JMOL of anticipation and no unjust enrichment under Rule 50(b). [...] The district court granted those motions, overturning the verdict and finding that the asserted claims of the ’668 patent are anticipated by the FHT-1 thermometer. [...] Further, the district court noted that to the extent that BestMed’s sales of the accused products occurred during the operation of the contracts between the parties (i.e., before May 1, 2009), any claim for unjust enrichment was waived by those contracts. [...] It then found that Medisim’s remaining unjust enrichment claim for any period after May 1, 2009, was not grounded in the record, as “there was no evidence to support a finding that BestMed received an incremental benefit over that compensable by the patent laws.” [...] The district court also granted BestMed a new trial on anticipation, “conditioned on an appellate court determining that [BestMed] failed to preserve its right to bring a post-trial motion for JMOL.” [...]
Medisim at *5 (internal citations omitted).
 

 
 
Legal Reasoning (PROST, Taranto, Chen)
Forfeiture of JMOL under Rule 50(a) and (b)
1. Forfeiture of JMOL on Anticipation
“T]he Supreme Court has held previously that our Federal Rules of Civil Procedure are to be strictly followed in circumstances such as this one. In Unitherm, for example, a party moved for a directed verdict under Rule 50(a) prior to the district court’s submission of the case to the jury, but following the verdict the party failed to renew its motion for JMOL pursuant to Rule 50(b). See 546 U.S. at 398. In preventing the party from challenging the sufficiency of the evidence on appeal, the Supreme Court stated that “a party is not entitled to pursue a new trial on appeal unless that party makes an appropriate postverdict motion in the district court.” Id. at 404. While the issue here is whether BestMed failed to move under Rule 50(a), the principle of forfeiture articulated in Unitherm remains the same. See, e.g., Yakus v. United States, 321U.S. 414, 444 (1944) (“No procedural principle is more familiar to this Court than that a . . . right may be forfeited. . . by the failure to make timely assertion of the right before a tribunal having jurisdiction to determine it.”).
Medism at *8.
With that principle in mind, we conclude that Best-Med forfeited its right to move for JMOL on anticipation. The statement that BestMed now relies on as evidence of a motion for JMOL actually indicates the opposite—BestMed’s counsel stated that anticipation was “definitely something for the jury.” J.A. 4530.
Id. at *8-9.
2. No Forfeiture of JMOL on Unjust Enrichment“We conclude that BestMed did not forfeit its right to move for JMOL on unjust enrichment under Rule 50(b) because it adequately made such a motion under Rule 50(a).”
Id. at *10.
Grant of JMOL on Unjust Enrichment
BestMed responds that although Medisim now makes water bath testing the focus of its unjust enrichment case, that issue was only a small part of Medisim’s overall unfair competition case below, and Medisim never asked the jury to find unjust enrichment on that basis. Indeed, BestMed argues that the unjust enrichment claim “fell in the interstices” of Medisim’s other claims. See Medisim, 959 F. Supp. 2d at 417. We agree with BestMed. During trial, Medisim failed to present any evidence to support a finding that BestMed received an incremental benefit from Medisim’s allegedly proprietary water bath testing procedure over that compensable by the patent laws. It grouped together its patent and non-patent damages claims, relying on Best-Med’s profits from all of the accused products. See Medisim, 959 F. Supp. 2d at 426 n.182. Medisim offered no evidence to show why BestMed had reason to think that Medisim’s procedures for water bath testing were confidential or otherwise proprietary. Thus, even when viewing all the evidence in the light most favorable to Medisim, we cannot conclude that equity and good conscience require restitution.
Medisim at *12-13.
Grant of a New Trial on Anticipation under Rule 50(c)
“The record shows that Medisim’s expert witness, Dr. Lipson, conceded that the FHT-1 calculated an intermediate temperature and that if “the intermediate temperature calculated by . . . the prior art FHT-1 thermometer, is a deep tissue temperature,” then the FHT-1 anticipates claim 1 of the ’668 patent and “whatever [other claims] require[] the deep tissue limitation.” […] Therefore, as the district court correctly noted, anticipation turns on one issue in this case: whether the intermediate temperature concededly calculated by the FHT-1 using the heat-flux algorithm of the ’397 patent qualifies as a deep tissue temperature as claimed in the ’668 patent. The specification of the [7,597,]668 patent relies on the ’397 patent to provide the algorithm to compute its deep-tissue temperature. The ’668 patent defines a local, deep-tissue temperature as “a temperature at a location under the skin that is the source of heat conducted to the sensors in the probe.” […] It also expressly describes the “heat flux calculation” of the ’397 patent as a method “to rapidly compute a deep tissue temperature of the body.” […] The specification further describes a processing unit that uses the heat-flux algorithm of the ’397 patent to generate the deep-tissue temperature. […] In the preferred embodiment, the deep-tissue temperature is converted to a corebody temperature using an equation that includes the output of the heat-flux algorithm of the ’397 patent, denoted Tavg. […] This intrinsic evidence, all discussed by the district court, heavily supports the conclusion that the FHT-1 calculates a deep tissue temperature and, therefore, anticipates the ’668 patent.”
Medisim at *14-15 (internal citations omitted).
Conclusion
For the foregoing reasons, we affirm the district court’s grant of JMOL regarding Medisim’s unjust enrichment claims. We vacate the district court’s grant of JMOL regarding Medisim’s anticipation claims but affirm its conditional grant of a new trial. We remand this case to the district court for further proceedings consistent with this opinion.
Medisim at *17.
 
 
 Joseph Morewood Staniforth, “The difference-JMStaniforth,” available as a public domain image due to expired copyright, http://commons.wikimedia.org/wiki/File:The_difference_-_JM_Staniforth.png (image edited) (last visited Sept. 23, 2014).
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