Gambro Lundia Ab v. Baxter Healthcare Corporation Defendant/cross-Appellant

110 F.3d 1573, 42 U.S.P.Q. 2d (BNA) 1378, 1997 U.S. App. LEXIS 6589, 1997 WL 164301
CourtCourt of Appeals for the Federal Circuit
DecidedApril 8, 1997
Docket95-1530, 96-1004
StatusPublished
Cited by91 cases

This text of 110 F.3d 1573 (Gambro Lundia Ab v. Baxter Healthcare Corporation Defendant/cross-Appellant) is published on Counsel Stack Legal Research, covering Court of Appeals for the Federal Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gambro Lundia Ab v. Baxter Healthcare Corporation Defendant/cross-Appellant, 110 F.3d 1573, 42 U.S.P.Q. 2d (BNA) 1378, 1997 U.S. App. LEXIS 6589, 1997 WL 164301 (Fed. Cir. 1997).

Opinion

RADER, Circuit Judge.

In this patent infringement case, Gambro Lundia AB (Gambro) appeals and Baxter Healthcare Corporation (Baxter) cross-appeals a final judgment of the United States District Court for the District of Colorado. The patent at issue, U.S. Patent No. 4,585,-552 (’552 patent), claims a “system for the measurement of the difference between two fluid flows in separate ducts.” This invention recalibrates sensors during hemodialysis to accurately measure the impurities removed from a patient’s blood. Due to error in the district court’s analyses of invalidity, unen-forceability, and infringement, this court reverses.

BACKGROUND

Hemodialysis, commonly called dialysis, removes contaminants and excess fluid from the patient’s blood when the kidneys do not function properly. Hemodialysis works by passing a dialysate solution through a machine, called a dialyzer, which functions as an *1575 artificial kidney. In the dialyzer, the dialy-sate passes on one side of a porous diffusion membrane, while the patient’s blood passes on the other side. Because of the pressure differential across the membrane, blood contaminants and excess fluid diffuse through the membrane from the patient’s blood into the dialysate. These impurities diffused from the patient’s blood are known as ultraf-iltrate.

After hemodialysis, the volume of the dia-lysate is greater. The difference between the initial and end volumes of dialysate can be used to calculate the amount of the ultraf-iltrate removed from a patient’s blood. This calculation is critical to the success of hemo-dialysis. Removal of too much or too little ultrafiltrate may lead to severe medical problems or even death.

Repgreen Limited (Repgreen), a British bioengineering company, improved ultrafil-trate calculation. Keith Wittingham, Rep-green’s chief designer, introduced the Rep-green monitoring system, the UFM 1000, in late 1977. Wittingham’s development relied on the research of Professor Michael Sander-son. The UFM 1000 used two electromagnetic flow sensors to measure the difference between the rate of dialysate flow into and out of the dialyzer. The difference in flow rates indicated the quantity of ultrafiltrate leaving the system. To calibrate the system for an accurate measurement of dialysate flow rates, the operator would direct clean dialysate through both sensors before dialysis. This calibration method, however, could not account for clogging in the outflow sensor during dialysis. Over time, the ultrafiltrate would build up behind the outflow sensor and disrupt the accuracy of the measurements. Experts refer to this increasing inaccuracy as “drift.”

In the late 1970s, Gambro sought to improve ultrafiltrate monitoring. During 1979, Wittingham met with Gambro engineers on two occasions to discuss Repgreen’s development of an ultrafiltrate monitor for Gambro. In July 1979, after Repgreen went bankrupt, Gambro purchased Repgreen’s hemodialysis technology, including the rights to the UFM 1000 monitor. After acquiring Repgreen’s technology, Gambro’s research team worked for three years on improving ultrafiltration monitors. In June 1982, four Gambro engineers, including Bengt-Ake Gummesson, refined the monitoring system. Their invention ultimately issued as the ’552 patent.

Gambro filed its initial patent application in Sweden on September 28, 1982. Gambro followed up with a U.S. application in September 1988. Gunnar Boberg, Repgreen’s in-house patent counsel, and Arnold Krum-holz, Repgreen’s U.S. patent counsel, prosecuted the U.S. application. The examiner rejected claim 1 as anticipated by a German patent application (German ’756). In response, Gambro provided the examiner with a German-language copy of German ’756, along with arguments prepared by Boberg (who is fluent in German). Based on this submission, the examiner withdrew the rejection. The ’552 patent issued on April 29, 1986.

The Gambro invention uses valves to direct clean dialysate around the dialyzer to recalibrate the sensors during dialysis. The invention’s valve system can direct clean dialysate through the first flow sensor, around the dialyzer, and through the second flow sensor. To recalibrate, the invention momentarily blocks passage of contaminated dialysate through the outflow sensor. Instead, clean dialysate flows through the outflow sensor and recalibrates the detectors with the same clean dialysate flowing through both intake and outflow sensors. After the brief recalibration, the hemodialysis continues with contaminated dialysate flowing through the second sensor. Claim 1 of the ’552 patent reads:

In dialysis equipment including a dial-yser, a system for measuring the difference in the rate of flow between first and second fluid streams, said first fluid stream comprising clean dialysis solution flowing to the dialyser and said second fluid stream comprising spent dialysis solution flowing from the dialyser, said system comprising
a first duct for receiving said first fluid stream flowing therethrough,
a second duct for receiving said second fluid stream flowing therethrough,
measuring means for measuring the difference in the rate of flow between said *1576 first and second fluid streams within said first and second ducts,
and transferring means for preventing the flow of said second fluid stream through said second duct while flowing said first fluid stream through both said first and second ducts without passing said first fluid stream through the dialyser and without altering said rate of flow of said first fluid stream between said first and second ducts such that said rate of flow of said first fluid stream through said first and second ducts is substantially equal,
whereby the measured difference of the rate of flow of said first fluid stream flowing through said first and second ducts is adaptable as a reference.

(Paragraph enumeration added.)

In 1984, Baxter acquired the dialysis equipment division of Extracorporeal, Inc. Dissatisfied with the accuracy of the Extra-corporeal technology, Baxter developed the Baxter SPS 550 and began marketing the device in December 1987. Gambro filed suit against Baxter in the District Court for the District of Colorado in March 1992 claiming the Baxter SPS 550 infringed the ’552 patent. In defense, Baxter asserted the invalidity and unenforceability of the ’552 patent.

After a ten-day bench trial on the issues of infringement, validity, and unenforeeability, the district court held claim 1 of the Gam-bro ’552 patent invalid for obviousness and derivation, and unenforceable for inequitable conduct. The district court also entered judgment in favor of Baxter on infringement, contributory infringement, inducing infringement, and willful infringement due to the invalidity and unenforceability of the ’552 patent. Further, the district court declined to award either party attorney fees or costs.

DISCUSSION

I. Derivation

The trial judge found that Gambro had derived the ’552 invention from a Wit-tingham proposal left in the files when Gam-bro acquired Repgreen’s dialysis technology.

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110 F.3d 1573, 42 U.S.P.Q. 2d (BNA) 1378, 1997 U.S. App. LEXIS 6589, 1997 WL 164301, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gambro-lundia-ab-v-baxter-healthcare-corporation-defendantcross-appellant-cafc-1997.