CAFC invokes first Seagate prong to reverse WD Mich in Stryker v. Zimmer

The outcome in Stryker v. Zimmer:


Zimmer, Inc., Zimmer Surgical, Inc., and Zimmer Orthopaedic Surgical
Products (collectively “Zimmer”) appeal
from the final judgment of the United States District
Court for the Western District of Michigan that U.S. Patent Nos. 6,022,329
(“’329 patent”), 6,179,807 (“’807 patent”), and 7,144,383 (“
’383 patent”) were valid and willfully infringed. For the reasons stated below, we
affirm the jury’s findings that the patents were valid and
infringed, and the jury’s award of damages to plaintiff-
appellees Stryker Corporation, Stryker Puerto Rico, Ltd.,
and Stryker Sales Corporation (collectively “Stryker”).
However, we reverse the district court’s judgment that
Zimmer’s infringement was willful, and, accordingly, we
vacate its award of treble damages.
Finally, we vacate and remand the district court’s finding of exceptional case
and its award of
attorneys’ fees.



As to the appeal of the denial of JMOL:


On the issues of infringement and validity that the jury decided,
Zimmer appeals the district court’s denials of
its motion for JMOL.
Generally, a district court grants
JMOL and sets aside the jury’s verdict if it “finds that a
reasonable jury would not have a legally sufficient eviden-
tiary basis to find for the party
on that issue.” Fed. R. Civ. P. 50(a).



The basic determination here: the patents were valid and
infringed, but Zimmer's defense was not unreasonable, so no
sanctions.


For the reasons stated below, we affirm the district
court’s judgment on the various defenses of non-
infringement and invalidity that Zimmer raises across the
three asserted patents. However, we also find that each
of these defenses was not unreasonable.



link: http://www.cafc.uscourts.gov/images/stories/opinions-orders/2013-1668_3-23-2015_revised_opinion.pdf

As to differences in standards between courts and the USPTO,
note the text:



While persuasive, the examiner’s
proffered rejection is not on its own dispositive, in large
part because the U.S. Patent and Trademark Office (“PTO”)
and district courts “take different approaches in
determining invalidity and on the same evidence could
quite correctly come to different conclusions.”
Ethicon, Inc. v. Quigg, 849 F.2d 1422, 1428 (Fed. Cir. 1988).


Seagate is mentioned:


To establish willful infringement, the patentee has
the burden of showing “by clear and convincing evidence
that the infringer acted despite an objectively high likeli-
hood that its actions constituted infringement of a valid
patent.” In re Seagate Tech., LLC, 497 F.3d 1360, 1371
(Fed. Cir. 2007) (en banc). “The state of mind of the
accused infringer is not relevant to this objective inquiry.” Id.
Only if the patentee establishes this “threshold objec-
tive standard” does the inquiry then move on to whether
“this objectively-defined risk (determined by the record
developed in the infringement proceeding) was either
known or so obvious that it should have been known to
the accused infringer.” Id



The CAFC noted the failure of the district court:



The district court failed to undertake an objective as-
sessment of Zimmer’s specific defenses to Stryker’s
claims. Instead, the district court’s analysis of objective
reasonableness summarily asserted that the “jury heard
testimony” that Zimmer “all but instructed its design
team to copy Stryker’s products.” Post-Verdict Order at 23.

The district court further concluded that
the “pioneering” nature of Stryker’s inventions
and the secondary considerations of non-
obviousness “made it dramatically less likely that
Zimmer’s invalidity arguments were reasonable.”
Id.
An objective assessment of the case shows that Zim-
mer presented reasonable defenses to all of the asserted
claims of Stryker’s patents.