In Hologic, Inc. v. Minerva Surgical, Inc., Case 19-2054 (Fed. Cir. Apr. 22, 2020), the Federal Circuit held that an assignor of a patent may rely on a PTAB unpatentability decision as a defense in infringement litigation, although the equitable doctrine of "assignor estoppel" prevents the assignor from directly challenging validity in the litigation. In Additional Views, Judge Stoll suggests that the en banc court reconsider the issue of assignor estoppel, because the court's precedent permits an assignor of a patent to "circumvent the doctrine of assignor estoppel by attacking the validity of a patent claim in the Patent Office."
Hologic sued Minerva Surgical for infringement of two patents directed to devices used to detect perforations in a patient's uterus (U.S. Patent Nos. 6,872,183 and 9,095,348). Minerva denied infringement, and also raised invalidity defenses, both in the district court proceeding and in two IPR petitions. Minerva's President and CEO was the inventor of the patents asserted against Minerva; he had earlier assigned the patents to Hologic's predecessor. Assignor estoppel did not prevent Minerva from filing the IPR petitions, because in Arista Networks, Inc. v. Cisco Sys., Inc., 908 F.3d 792, 804 (Fed. Cir. 2018), the court had determined that assignor estoppel does not preclude an assignor from filing an IPR petition challenging the assigned patent. The PTAB instituted review of one of the two Hologic patents (the '183 patent), and denied review of the other. A PTAB final decision holding the challenged claims of the '183 patent unpatentable for obviousness was ultimately affirmed by the Federal Circuit in a separate appeal.
The district court case proceeded concurrently with the PTAB proceedings, and the court granted Hologic's motion for summary judgment of no invalidity, on the basis of assignor estoppel. At trial on the issues of infringement and damages, a jury found that Minerva infringed both patents, and awarded Hologic damages of $4.8 million. After trial, the '348 patent expired, and a few months later the Federal Circuit affirmed the PTAB decision canceling the '183 patent claims. In post-trial motions decided after affirmance of the PTAB decision, the district court upheld the jury's damages award because the jury had found that Minerva infringed both patents, but in view of the affirmed IPR decision, the court denied as moot Hologic's motions for supplemental damages and ongoing royalties for infringement of the canceled '183 patent, and for a permanent injunction.
On appeal the Federal Circuit determined that the district court properly applied collateral estoppel based on the PTAB decision invalidating the '183 patent. In view of Arista Networks, Inc. v. Cisco Sys. and other precedent, the court concluded that assignor estoppel did not preclude Minerva from relying on the affirmed PTAB decision to argue that the '183 patent claims were void ab initio. According to the Federal Circuit, the district court properly denied Hologic's motions for injunctive and monetary relief following a finding of patent infringement. The court acknowledged the seeming unfairness to Hologic, in permitting the Minerva to "circumvent" assignor estoppel:
Although Minerva would have been estopped from challenging the validity of the '183 patent claims in district court, it was able to challenge their validity in an IPR proceeding and, hence, circumvent the assignor estoppel doctrine.
In Additional Views, Judge Stoll wrote separately to address the court's precedent on assignor estoppel, which the panel was bound to follow, and she suggested that the court reconsider this doctrine en banc:
We should seek to clarify this odd and seemingly illogical regime in which an assignor cannot present any invalidity defenses in district court but can present a limited set of invalidity grounds in an IPR proceeding.
Holigic illustrates the apparent contradictions of assignor estoppel law, which prohibits an assignor from directly challenging patent validity in district court proceedings, but permits the assignor to challenge validity before the PTAB, and then rely on a PTAB invalidity decision in district court. Time will tell if the Federal Circuit takes up Judge Stoll's suggestion to reconsider this "odd and seemingly illogical regime."
Originally published April 28, 2020
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