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`UNITED STATES DISTRICT COURT
`DISTRICT OF NEW JERSEY
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`____________________________________
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`CURLIN MEDICAL INC. et al.,
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`::
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`Civil Action No. 16-2464 (SRC)
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` OPINION & ORDER
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`:
`Defendant.
`____________________________________:
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`CHESLER, U.S.D.J.
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`This matter comes before the Court on the motion for a preliminary injunction by
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`Plaintiffs Curlin Medical Inc. (“Curlin”), Zevex, Inc. and Moog Inc. (collectively, “Plaintiffs”)
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`against Defendant Acta Medical, LLC (“Acta.”) This Court held oral argument on this motion
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`on January 11, 2017. For the reasons stated below, the motion will be granted.
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`BACKGROUND
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`This case arises from a patent infringement dispute involving a medical device, a tubing
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`set for use with an infusion pump. Curlin owns U.S. Patent Nos. 6,164,921 (the “’921 patent”)
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`and 6,371,732 (the “’732 patent”), directed to, among other things, a tubing set for use with an
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`infusion pump. Plaintiffs manufacture and sell infusion pumps as well as tubing sets for use with
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`them. Acta manufactures and sells the “IV Administration Infusion Pump Set” (the “IVA Set.”)
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`In May of 2016, Plaintiffs filed a Complaint alleging patent infringement and, shortly
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`thereafter, a motion for a preliminary injunction and expedited discovery. The application for
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`expedited discovery was granted and, after the completion of the discovery for this motion, the
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`parties completed the briefing on the preliminary injunction motion.
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`::
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`::
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`Plaintiffs,
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`v.
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`ACTA MEDICAL, LLC,
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`Case 2:16-cv-02464-SRC-CLW Document 72 Filed 01/13/17 Page 2 of 12 PageID: 2291
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`APPLICABLE LEGAL STANDARDS
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`I.
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`Preliminary Injunction
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`“The grant of a preliminary injunction under 35 U.S.C. § 283 is within the discretion of
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`the district court.” Curtiss-Wright Flow Control Corp. v. Velan, Inc., 438 F.3d 1374, 1378 (Fed.
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`Cir. 2006). “A plaintiff seeking a preliminary injunction must establish that he is likely to
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`succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary
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`relief, that the balance of equities tips in his favor, and that an injunction is in the public
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`interest.” Winter v. NRDC, Inc., 129 S. Ct. 365, 374 (2008). The Supreme Court has held that
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`injunctive relief is “an extraordinary remedy that may only be awarded upon a clear showing that
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`the plaintiff is entitled to such relief.” Id. at 376.
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`As to the requirement that the movant establish that he is likely to succeed on the merits,
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`the Federal Circuit has held:
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`[T]he patentee seeking a preliminary injunction in a patent infringement suit must
`show that it will likely prove infringement, and that it will likely withstand
`challenges, if any, to the validity of the patent. In assessing whether the patentee
`is entitled to the injunction, the court views the matter in light of the burdens and
`presumptions that will inhere at trial. . . .
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`Titan Tire Corp. v. Case New Holland, Inc., 566 F.3d 1372, 1376 (Fed. Cir. 2009) (citation
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`omitted). “An accused infringer can defeat a showing of likelihood of success on the merits by
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`demonstrating a substantial question of validity or infringement.” Trebro Mfg. v. FireFly Equip.,
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`LLC, 748 F.3d 1159, 1165 (Fed. Cir. 2014). “A preliminary injunction should not issue if an
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`alleged infringer raises a substantial question regarding either infringement or validity, i.e., the
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`alleged infringer asserts an infringement or invalidity defense that the patentee has not shown
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`lacks substantial merit.” AstraZeneca LP v. Apotex, Inc., 633 F.3d 1042, 1050 (Fed. Cir. 2010).
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`2
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`Case 2:16-cv-02464-SRC-CLW Document 72 Filed 01/13/17 Page 3 of 12 PageID: 2292
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`At trial, the plaintiff bears the burden of proving infringement by a preponderance of the
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`evidence. Tech. Licensing Corp. v. Videotek, Inc., 545 F.3d 1316, 1327 (Fed. Cir. 2008).
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`ANALYSIS
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`I.
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`Plaintiffs have demonstrated that they are likely to succeed on the merits.
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`Plaintiffs contend that the IVA Set literally infringes claims 15-34 of the ’921 patent and
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`claims 1-3 of the ’732 patent. “In order to establish the first preliminary injunction factor,
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`[Plaintiff] must show that it will likely prove that [Defendant] infringes at least one valid and
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`enforceable patent claim.” Abbott Labs. v. Andrx Pharms., Inc., 473 F.3d 1196, 1201 (Fed. Cir.
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`2007). “To prove an accused product literally infringes the patent in suit, the product must
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`contain each and every limitation of the asserted claim(s).” Trebro, 748 F.3d at 1166.
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`Acta, in opposition, does not challenge the validity of the patents in suit, but argues that
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`they are unenforceable due to the inequitable conduct of the Plaintiffs in regard to the small
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`entity maintenance fee. Acta makes two arguments: 1) Plaintiffs “sought to deceive the PTO
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`about the circumstances surrounding the payment of the small entity maintenance fee so that
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`they PTO would accept their late payment and thereby restore the ‘732 patent” (Def.’s Opp. Br.
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`3); and 2) Plaintiffs “sought to deceive the PTO about the facts and circumstances surrounding
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`the erroneous payment of the small entity amount for the maintenance fee so that they PTO
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`would accept their late payment and thereby restore the ‘921 patent and the ‘732 patent.” (Def.’s
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`Opp. Br. 4.)
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`In Therasense, the Federal Circuit set forth the fundamental principles of the law of
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`inequitable conduct claims:
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`To prevail on the defense of inequitable conduct, the accused infringer must prove
`that the applicant misrepresented or omitted material information with the specific
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`3
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`Case 2:16-cv-02464-SRC-CLW Document 72 Filed 01/13/17 Page 4 of 12 PageID: 2293
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`intent to deceive the PTO. The accused infringer must prove both
`elements—intent and materiality—by clear and convincing evidence. If the
`accused infringer meets its burden, then the district court must weigh the equities
`to determine whether the applicant’s conduct before the PTO warrants rendering
`the entire patent unenforceable.
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`Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276, 1287 (Fed. Cir. 2011). Thus, at
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`trial, Acta must prove that Plaintiffs misrepresented or omitted material information with specific
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`intent to deceive the PTO. On the present record, this Court cannot discern an evidentiary basis
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`to conclude that Acta has raised a substantial question about unenforceability due to inequitable
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`conduct. At this juncture, Acta has deposed none of the relevant people involved, and there is
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`nothing in the present record from which this Court could infer that Plaintiffs acted with a
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`specific intent to deceive the PTO, much less that the evidence supports a finding of such by
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`clear and convincing evidence. Nor is there anything in the record to support a finding that the
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`omitted information was material. The only factual allegation Acta makes in support is that an
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`internal note has been found that the ’732 patent no longer qualifies for small entity status. The
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`Court has no information on who wrote this note, who saw it, when it was written, or anything
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`else. This factual allegation is insufficient to persuade this Court that Acta has raised a
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`substantial question of inequitable conduct under Therasense.
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`Acta argues as well that Plaintiffs cannot prove infringement. As to the ’732 patent, Acta
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`argues that the IVA Set does not contain each and every limitation of any of claims 1-3.
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`Specifically, Acta points to this limitation in independent claim 1: “at least one tubing sensor
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`disposed in a housing of the pump.” There is no dispute that the IVA Set does not contain this
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`element. At oral argument, the Court asked Plaintiffs how, then, Acta met this limitation.
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`Plaintiffs answered that, at sales demonstrations, Acta representatives placed the IVA Set into a
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`4
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`Case 2:16-cv-02464-SRC-CLW Document 72 Filed 01/13/17 Page 5 of 12 PageID: 2294
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`pump unit manufactured by Plaintiffs, thus using it in a way that meets every element of one or
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`more claims in the ’732 patent and so infringes. While this is conceivably true, the Court notes
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`that the briefs do not argue this and so they do not point to evidence supporting it, nor did
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`counsel point to evidence of record at the hearing. At this juncture, the Court has only attorney
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`argument to support this theory of infringement, and that is not sufficient to support a finding
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`that Plaintiffs are likely to succeed in proving that Acta infringes the ’732 patent by its acts at
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`sales demonstrations.
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`Acta next argues that the IVA Sets do not contain a positionable locating member, as
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`required by some of the claims, because the corresponding element of their set is in a fixed
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`position, and may not be repositioned. The Court observes that this claim term appears only in
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`independent claims 22, 26, and 30 in the ’921 patent; it does not appear in claims 15-21.
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`Because of this fact, the Court may not need – and, in fact, does not need – to reach this dispute,
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`because it finds a likelihood of success in proving infringement of at least one claim in the group
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`of claims 15-21.
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`Similarly, Acta argues that the IVA Sets do not contain “a length of straight line, resilient
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`tubing.” Again, the Court need not reach this issue, because this claim term appears only in
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`independent claims 22, 26, and 30 in the ’921 patent; it does not appear in claims 15-21.
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`Because of this fact, the Court may not need – and, in fact, does not need – to reach this dispute,
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`because it finds a likelihood of success in proving infringement of at least one claim in the group
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`of claims 15-21.
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`Acta also argues that the IVA sets do not contain “a length of resilient tubing,” which is a
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`limitation in claims 15-21, because the Court should import a further claim limitation from a
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`5
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`Case 2:16-cv-02464-SRC-CLW Document 72 Filed 01/13/17 Page 6 of 12 PageID: 2295
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`preferred embodiment in the specification.1 At oral argument, however, it appeared that Acta
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`applied this argument to all of the ’921 claims at issue. At the hearing, Acta pointed to this
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`language in the specification sections of both patents:
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`In the tubing assembly 12, the tubing locator pin 92 and shut-off valve 14 may be
`added or attached to lengths of resilient tubing of differing diameters.
`Additionally, the use of off-the-shelf straight line, continuous PVC tubing in the
`present tubing assembly 12 as opposed to a segment of silicone tubing having
`segments of PVC tubing mechanically secured thereto as is required by many
`prior art peristaltic pumps substantially reduces the costs associated with the
`present tubing assembly 12, in addition to providing increased reliability thereto
`due to the absence of any mechanical joints therein.
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`’921 patent, col.13 ll.23-33; ’732 patent, col.13 ll.21-31. Acta contends that this operates as a
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`disclaimer of claim scope, limiting all claims to tubing sets constructed from continuous,
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`unsegmented PVC tubing. This is not persuasive, when viewed in the context of the three claims
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`in the ’732 patent. Claim 1 includes this limitation: “a length of straight line, resilient tubing.”
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`Claim 3 states: “The administration set of claim 1 wherein the tubing is fabricated as a
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`continuous polyvinyl chloride member.” In construing the meaning of claim 1 and claim 3, the
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`doctrine of claim differentiation is helpful:
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`In the most specific sense, “claim differentiation” refers to the presumption that
`an independent claim should not be construed as requiring a limitation added by a
`dependent claim. Thus, the claim differentiation tool works best in the
`relationship between independent and dependent claims. Indeed the statute
`stresses that a dependent claim must add a limitation to those recited in the
`independent claim. Thus, reading an additional limitation from a dependent claim
`into an independent claim would not only make that additional limitation
`superfluous, it might render the dependent claim invalid.
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`Curtiss-Wright Flow Control Corp. v. Velan, Inc., 438 F.3d 1374, 1380 (Fed. Cir. 2006)
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`1 The Court notes that this is a perhaps overgenerous reading of Acta’s opposition brief,
`which does not in fact apply this argument to claims 15-21, but only to claims 22-33. (See
`Def.’s Opp. Br. at 11.)
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`6
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`Case 2:16-cv-02464-SRC-CLW Document 72 Filed 01/13/17 Page 7 of 12 PageID: 2296
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`(citations omitted). Thus, under the doctrine of claim differentiation, claim 3 presents this
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`additional limitation to independent claim 1: “the tubing is fabricated as a continuous polyvinyl
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`chloride member.” To differentiate these two claims, then, claim 1 does not require the tubing to
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`be “fabricated as a continuous polyvinyl chloride member.” As a consequence of this
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`interpretation, the specification language cited by Acta cannot limit every claim to “the use of
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`off-the-shelf straight line, continuous PVC tubing.” Continuous PVC tubing is required by claim
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`3 of the ’732 patent, but not claim 1.
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`Furthermore, not one of the claims in the ‘921 patent contains the word “continuous.”
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`Independent claims 22, 26, and 30 all require “a length of straight line, resilient tubing.” The
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`parties did not address the meaning of this phrase, and the Court sees no basis to construe it to
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`mean “only one continuous piece of PVC tubing.”
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`Furthermore, in asking the Court to import a limitation from the specification, Acta
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`follows a path well-worn by patent challengers, and Federal Circuit law disfavors this path:
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`The claims, not specification embodiments, define the scope of patent protection.
`The patentee is entitled to the full scope of his claims, and we will not limit him
`to his preferred embodiment or import a limitation from the specification into the
`claims.
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`Kara Tech. Inc. v. Stamps.com Inc., 582 F.3d 1341, 1348 (Fed. Cir. 2009). Furthermore:
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`It is likewise not enough that the only embodiments, or all of the embodiments,
`contain a particular limitation. We do not read limitations from the specification
`into claims; we do not redefine words. Only the patentee can do that. To
`constitute disclaimer, there must be a clear and unmistakable disclaimer.
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`Thorner v. Sony Computer Entm't Am. LLC, 669 F.3d 1362, 1366-67 (Fed. Cir. 2012).
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`Applying this standard, Acta has not raised a substantial question about infringement, as it has
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`not raised a substantial question that the “clear and unmistakable disclaimer” standard has been
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`7
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`Case 2:16-cv-02464-SRC-CLW Document 72 Filed 01/13/17 Page 8 of 12 PageID: 2297
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`met, so as to limit “a length of resilient tubing” to a single length of continuous PVC tubing
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`without any joints.
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`Acta next argues that the IVA Sets do not include the following element in claims 21 and
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`34: “a single pinch arm . . . being movable between an open position whereat the tubing passing
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`through the valve body is not compressed by the pinch arm.” Acta argues that Plaintiffs’ expert
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`conceded that the pinch arm slightly compresses the tubing even when disengaged, but this is not
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`correct: as Plaintiffs pointed out, their expert clarified on reply that it is his position that it is the
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`valve body, and not the pinch arm itself, that slightly compresses the tubing. (Meyst Reply Dec.
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`¶¶ 43-45.) This Court concludes that Acta’s argument on this point does not raise a substantial
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`question of the infringement of claims 21 and 34.
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`As to claims 15-20 in the ’921 patent, then, Acta’s only defense to infringement is the
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`argument that this Court should import the “continuous PVC” limitation from the specification
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`as a claim limitation. The Court finds no basis to conclude that Acta can meet the high bar set
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`by the Federal Circuit, that the patentees made a “clear and unmistakable disclaimer.” This
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`Court finds that, as to claims 15-21, Acta has made no substantial challenges to Plaintiff’s
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`infringement case, and thus that Plaintiffs have shown a likelihood of success on the merits in
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`proving that Acta has infringed claims 15-21 of the ’921 patent.
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`II.
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`Plaintiffs have demonstrated irreparable harm.
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`Plaintiffs have shown that they are likely to suffer irreparable harm in the absence of
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`preliminary relief, due to price erosion. There is no dispute that Acta has sold its product to
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`customers who would have otherwise purchased Plaintiffs’ tubing set, and that Acta sells its
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`product at a substantial discount. The Federal Circuit has recognized price erosion as an
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`8
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`Case 2:16-cv-02464-SRC-CLW Document 72 Filed 01/13/17 Page 9 of 12 PageID: 2298
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`irreparable injury in similar cases: “Under this court’s precedent, price erosion, loss of goodwill,
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`damage to reputation, and loss of business opportunities are all valid grounds for finding
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`irreparable harm.” Aria Diagnostics, Inc. v. Sequenom, Inc., 726 F.3d 1296, 1304 (Fed. Cir.
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`2013). The Federal Circuit has further explained:
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`Competitors change the marketplace. Years after infringement has begun, it may
`be impossible to restore a patentee’s (or an exclusive licensee’s) exclusive
`position by an award of damages and a permanent injunction. Customers may
`have established relationships with infringers. The market is rarely the same when
`a market of multiple sellers is suddenly converted to one with a single seller by
`legal fiat. Requiring purchasers to pay higher prices after years of paying lower
`prices to infringers is not a reliable business option.
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`Polymer Techs., Inc. v. Bridwell, 103 F.3d 970, 975-976 (Fed. Cir. 1996).
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`Plaintiffs have pointed to evidence that Acta has imported at least 10,000 units of the
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`IVA Set, and that it has sold at least 1,200 of these units. (See Pls.’ Supp. Br. at 5 n.7.)
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`Plaintiffs contend that Acta sells its competing product for as much as 35% less than Plaintiffs’
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`price. This suggests that, unless enjoined, Acta is poised to take a large chunk of Plaintiffs’
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`future administration set sales. This Court finds that Plaintiffs have demonstrated that, in the
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`absence of injunctive relief, they are likely to suffer this kind of harm, price erosion, a harm that
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`cannot be redressed by money damages alone.
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`III.
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`The balancing of the hardships weighs in Plaintiffs’ favor.
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`Acta argues that the balancing of hardships favors it because, in short, the IV sets at
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`issue, on a percentage basis, form a much larger share of its total business than of the combined
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`Plaintiffs’ total business. This implies that the balancing of hardships generally tilts in favor of
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`the small company over the large one, and rests on a misunderstanding of Federal Circuit law.
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`The Court does not weigh in a vacuum the harm to one party from the grant of the injunction
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`9
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`Case 2:16-cv-02464-SRC-CLW Document 72 Filed 01/13/17 Page 10 of 12 PageID: 2299
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`against the harm to the other party from the denial of the injunction. Rather, the Federal Circuit
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`has explained:
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`The magnitude of the threatened injury to the patent owner is weighed, in the
`light of the strength of the showing of likelihood of success on the merits, against
`the injury to the accused infringer if the preliminary decision is in error.
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`H.H. Robertson Co. v. United Steel Deck, Inc., 820 F.2d 384, 390 (Fed. Cir. 1987). Robertson
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`makes clear that the balancing of the harms must be performed in light of the strength of the
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`showing of likelihood of success on the merits. In this case, Plaintiffs have made a strong
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`showing of a likelihood of success on the merits, and the risk that the grant of a preliminary
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`injunction will later be found to have been in error appears small to this Court. Because this
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`Court has found that there is a strong likelihood that Plaintiffs will be irreparably injured were
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`the injunction denied in error, and a weak likelihood that Acta will be harmed were the
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`injunction granted in error, the balance of hardships weighs in Plaintiffs’ favor.
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`IV.
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`The public interest factor is neutral.
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`Here, both parties argue that the other’s product is potentially unsafe due to quality
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`control issues, and that it is in the public interest to protect people from unsafe medical products.
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`This Court finds that neither party has made a stronger case in support of this argument, and this
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`factor is neutral.
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`The Court finds that Plaintiffs have demonstrated that they are likely to succeed on the
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`merits of proving infringement, that they are likely to suffer irreparable harm in the absence of
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`preliminary relief, and that the balance of equities tips in their favor. The fourth factor, whether
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`an injunction is in the public interest, favors neither party. The Court therefore grants Plaintiffs’
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`application for a preliminary injunction against Acta.
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`10
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`Case 2:16-cv-02464-SRC-CLW Document 72 Filed 01/13/17 Page 11 of 12 PageID: 2300
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`The parties did not brief or address the issue of the amount of the bond. Federal Rule of
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`Civil Procedure 65(c) states:
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`Security. The court may issue a preliminary injunction or a temporary restraining
`order only if the movant gives security in an amount that the court considers
`proper to pay the costs and damages sustained by any party found to have been
`wrongfully enjoined or restrained.
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`Rule 65(c) requires the Court to set a bond amount that is proper to pay the costs and damages
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`sustained by any party found to have been wrongfully enjoined or restrained. In the absence of
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`any briefing or argument on this issue, this Court sets the bond amount at $25,000.00.
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`For these reasons,
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`IT IS on this 12th day of January, 2017 hereby
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`ORDERED that Plaintiffs’ motion for a preliminary injunction (Docket Entry Nos. 6, 49,
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`51) is GRANTED; and it is further
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`ORDERED that Defendant ACTA Medical, LLC, and its employees, agents,
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`officers, directors, subsidiaries, affiliates, parents, and all other persons or entities within its
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`control or supervision or acting in concert with it, during the pendency of this litigation, are
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`enjoined from making, selling, offering for sale, using and/or importing their “IV Administration
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`Infusion Pump Sets” or other products that infringe on plaintiffs’ patents, U.S. Patent Nos.
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`6,164,921 and 6,371,732, or from otherwise committing further acts of infringement on those
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`patents either directly or indirectly; and it is further
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`ORDERED that this Order shall remain in place unless and until modified by
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`further Order of this Court; and it is further
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`11
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`Case 2:16-cv-02464-SRC-CLW Document 72 Filed 01/13/17 Page 12 of 12 PageID: 2301
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`ORDERED that, pursuant to Federal Rule of Civil Procedure 65(c), Plaintiffs shall post
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`a preliminary injunction bond with the Clerk of the Court in the amount of $25,000.00.
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` s/ Stanley R. Chesler
`Stanley R. Chesler, U.S.D.J.
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`12
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