Hologic Wins $4.8M in Jury Verdict After Judge Determines Assignor Estoppel BarredPatent Invalidity Defenses

On July 27th, a jury verdict entered in the District of Delaware awarded $4.8 million in lost profit and reasonable royalty damages to Marlboro, MA-based medical technology company Hologic Inc. after the jury determined that two of its patents were infringed by Redwood City, CA-based medical device company Minerva Surgical. At issue in the case was a technology marketed by Minerva to treat women dealing with abnormal uterine bleeding (AUB).

The jury based the damages award in this case on two patents asserted by Hologic:

• U.S. Patent No. 6872183, titled System and Method for Detecting Perforation in a Body Cavity. Issued in March 2005, it covers a method of ablating a uterus involving the steps of inserting an ablation device into a uterus, flowing an inflation medium into the uterus, monitoring for the presence of a perforation in the uterus using a pressure sensor and treating the interior of the uterus with the ablation device.
• U.S. Patent No. 9095348, titled Moisture Transport System for Contact Electrocoagulation. Issued in August 2015, it covers a device for treating a uterus which includes an electrode array that remains in contact with the tissue to be ablated for proper dehydration and enables more precise tissue ablation than conventional radiofrequency (RF) devices existing in the prior art.

Hologic first filed suit alleging patent infringement against Minerva in November 2015, accusing Minerva’s Endometrial Ablation System of infringing upon Hologic’s patents. Hologic practiced the patented technology itself in its NovaSure ablation system which was first approved for use by the U.S. Food and Drug Administration in 2001.

During the course of the district court litigation, Minerva challenged the validity of the ‘183 patent through a petition for inter partes review (IPR) filed March 2016 at the Patent Trial and Appeal Board (PTAB). In a final written decision issued by the PTAB in December 2017, all 15 claims of the ‘183 patent were rendered invalid on grounds of obviousness. The PTAB also determined that eight substitute claims provided by Hologic in a motion to amend were unpatentable in light of the prior art record.

Minerva’s invalidation of the ‘183 patent at the PTAB, however, did not render the patent moot in the district court litigation. In a memorandum opinion filed this June by U.S. District Judge Joseph Bataillon, the judge rejected a motion made by Minerva to dismiss the case due to no viable cause of action as a result of the IPR proceedings. “The patent has not been cancelled,” Judge Bataillon wrote. “The PTAB finding is on appeal and does not have preclusive effect as to this action unless and until the appeal is resolved.”

Minerva’s invalidity defenses raised at district court were also dismissed by Judge Bataillon based on the theory of assignor estoppel raised in a motion by Hologic. Minerva was founded in 2008 by Csaba Truckai, an inventor listed on both of the patents asserted by Hologic. Previously, Truckai had co-founded NovaCept, a predecessor to Hologic, in 1993 and led the development of the NovaSure system. Truckai had assigned his interest to patent applications to which both the ‘348 and ‘183 patents claim priority by 2001 to NovaCept and the patents became Hologic’s property after a series of acquisitions, including a transaction worth $325 million through which both patents were transferred to Hologic’s predecessor. Citing to the Federal Circuit’s 1988 decision in Diamond Scientific v. Ambico, Judge Bataillon wrote that assignor estoppel prevents a person from transferring their rights to a patent and then later contending that the patent rights transferred were nulled. Because the court determined that Truckai was in privity with Minerva as its founder, assignor estoppel barred Minerva’s invalidity defenses.

In the verdict, the jury also found in favor of Hologic on Minerva’s counterclaims of both breach of contract as well as false advertising under the Lanham Act. The jury did, however, find in favor of Minerva regarding Hologic’s claims that the infringement of the ‘348 patent was willful.

In a press release issued after the jury verdict, Sean Daugherty, president of GYN surgical solutions at Hologic, made the following statement:

“We are extremely pleased with the Court’s ruling and the jury’s verdict, which together validate Hologic’s assertions of patent infringement by Minerva Surgical and recognize the value of our intellectual property. As the maker of the NovaSure system, we are committed to delivering best-in-class products backed by strong clinical data for our customers and their patients.”

Dave Clapper, CEO of Minerva, also offered a statement in a press release on the outcome of the trial:

“Although the jury apparently gave credit to Minerva for its own independent innovation, and awarded only a fraction of what Hologic was seeking in damages, we nevertheless intend to vigorously challenge infringement and that any award was warranted.  We also intend to support the Patent Office’s conclusion last December that Hologic’s ‘183 patent is invalid, and thus cannot be enforced against Minerva or anyone else. This is but one step in a multi-phase process and there remain issues to be decided by the Court of Appeals that could impact the applicability of this verdict.  We intend to continue selling the Minerva product and, if necessary, pursue the appellate process to ensure the right of women to have access to our best-in-class Minerva treatment, with statistically greater effectiveness compared to the other FDA approved endometrial ablation devices.”