By Dennis Crouch
Medtronic Inc. v. Boston Scientific Corp., Docket No. 12-1128 (Supreme Court 2013)
The Supreme Court has granted a writ of certiorari in a license dispute involving giants of the medical device world – Medtronic and Boston Scientific. Medtronic has licensed defibrillator patents owned by Mirowski Family Ventures and now controlled by Boston Scientific as exclusive licensee. U.S. Reissue Patent Nos. RE38,119 and RE39,897. Medtronic's license gives it the right to challenge the patent in court even while still under license. That right to challenge is also supported by the Supreme Court's 2007 decision in MedImmune. And, in a 2007 court filing, Medtronic did challenge the license – alleging that its new products did not infringe the patents in question.
Normally, the patentee has the burden of proving infringement. The odd ruling in this case came when the Federal Circuit flipped that normal approach and held instead that the burden shifts to the DJ plaintiff when the case involves a licensee-in-good-standing suing for declaratory judgment of non-infringement. The Supreme Court will now consider whether that burden shift is appropriate – and in all likelihood will reject the Federal Circuit's decision 9-0.
Medtronic asks the following question:
In MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 137 (2007), this Court ruled that a patent licensee that believes that its products do not infringe the patent and accordingly are not subject to royalty payments is "not required … to break or terminate its … license agreement before seeking a declaratory judgment in federal court that the underlying patent is … not infringed."
The question presented is whether, in such a declaratory judgment action brought by a licensee under MedImmune, the licensee has the burden to prove that its products do not infringe the patent, or whether (as is the case in all other patent litigation, including other declaratory judgment actions), the patentee must prove infringement.
One question that the court needs to answer is whether its rules regarding licensee standing and burdens are hard-and-fast or instead whether they should be treated as default rules that can be altered by contracting parties.
Hal Wegner of Foley writes that the case will be briefed over the summer and heard early in the October 2013 Term.