Insulet Corp. v. Eoflow, Co. Ltd.

104 F.4th 873
CourtCourt of Appeals for the Federal Circuit
DecidedJune 17, 2024
Docket24-1137
StatusPublished
Cited by3 cases

This text of 104 F.4th 873 (Insulet Corp. v. Eoflow, Co. Ltd.) 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
Insulet Corp. v. Eoflow, Co. Ltd., 104 F.4th 873 (Fed. Cir. 2024).

Opinion

Case: 24-1137 Document: 49 Page: 1 Filed: 06/17/2024

United States Court of Appeals for the Federal Circuit ______________________

INSULET CORP., Plaintiff-Appellee

v.

EOFLOW, CO. LTD., EOFLOW, INC., Defendants-Appellants

STEVEN DIIANNI, LUIS J. MALAVE, IAN G. WELSFORD, JESSE J. KIM, FLEXTRONICS MEDICAL SALES AND MARKETING LTD., Defendants ______________________

2024-1137 ______________________

Appeal from the United States District Court for the District of Massachusetts in No. 1:23-cv-11780-FDS, Judge F. Dennis Saylor, IV. ______________________

Decided: June 17, 2024 ______________________

WILLIAM M. JAY, Goodwin Procter LLP, Washington, DC, argued for plaintiff-appellee. Also represented by MATTHEW GINTHER, JENNY J. ZHANG; ROBERT CARROLL, GERARD J. CEDRONE, WILLIAM EVANS, ROBERT FREDERICKSON, III, Boston, MA; ALEXANDRA D. VALENTI, New York, NY. Case: 24-1137 Document: 49 Page: 2 Filed: 06/17/2024

ADAM GERSHENSON, Cooley LLP, Boston, MA, argued for defendants-appellants. Also represented by KIMBERLEY A. SCIMECA; ELIZABETH M. FLANAGAN, Minneapolis, MN; PATRICK HAYDEN, New York, NY; DUSTIN KNIGHT, Wash- ington, DC; LOWELL D. MEAD, Palo Alto, CA. ______________________

Before LOURIE, PROST, and STARK, Circuit Judges. LOURIE, Circuit Judge. EOFlow, Co. Ltd. and EOFlow, Inc. (collectively, “EOFlow”) appeal from an October 24, 2023 order of the United States District Court for the District of Massachu- setts granting a preliminary injunction sought by Insulet Corp. (“Insulet”). See Insulet Corp. v. EOFlow, Co., No. 1:23-cv-11780-FDS, 2023 WL 7647573 (D. Mass. Oct. 24, 2023) (“Order”); J.A. 38−41. The injunction enjoined EOFlow from manufacturing, marketing, or selling any product that was designed, developed, or manufactured, in whole or in part, using or relying on alleged trade secrets of Insulet. On May 7, 2024, we issued a temporary stay of the injunction pending this opinion. For the following rea- sons, we lift our stay and reverse the district court’s order. BACKGROUND Insulet and EOFlow are medical device manufacturers that make insulin pump patches. Insulet began developing the wearable insulin pump OmniPod® in the early 2000s. J.A. 190. The FDA approved the first OmniPod product in 2005, and a next-generation product, the OPI-2, came onto the market soon thereafter in 2007. Id. at 202. Insulet then began work on its next-generation Eros product, which obtained FDA approval in 2012 and commercially launched in 2013. Id. at 203. EOFlow began developing its own flagship product, an insulin pump patch called the EOPatch®, soon after the company’s founding in 2011. J.A. 1078. The EOPatch Case: 24-1137 Document: 49 Page: 3 Filed: 06/17/2024

INSULET CORP. v. EOFLOW, CO. LTD. 3

received regulatory approval in South Korea in 2017, after which EOFlow began developing its next-generation EOPatch 2. Id. at 1747. Around that time, four former Insulet employees joined EOFlow. See id. at 5, 230−31, 8979, 9079, 9744. In 2019 and 2022, respectively, the EOFlow 2 received regulatory approval in South Korea and Europe, after which it began commercial distribution in those select geographic markets. Id. at 1747−51. In early 2023, reports surfaced that Medtronic had started a diligence process to acquire EOFlow. J.A. 1072−73, 1077−78. Soon thereafter, Insulet sued EOFlow in the U.S. District Court for the District of Massachusetts for violations of, among other things, the Defend Trade Se- crets Act (“DTSA”), seeking a temporary restraining order and a preliminary injunction to enjoin all technical commu- nications between EOFlow and Medtronic in view of its trade secrets claims. On August 29, 2023, the district court temporarily re- strained EOFlow from “disclosing products or manufactur- ing technical information related to the EOPatch or Omni[P]od products.” J.A. 1254. On October 4, 2023, the court granted Insulet’s request for a preliminary injunc- tion, finding that (1) “there is strong evidence that Insulet is likely to succeed on the merits of its trade secrets claim at least in part,” (2) there was “strong evidence of misap- propriation” because EO Flow hired former Insulet employ- ees who retained “Insulet’s confidential documents” that “fall within the statutory definition of trade secret,” and (3) that irreparable harm to Insulet crystallized when EOFlow announced an intended acquisition by Medtronic, which “would be a source of capital for EOFlow” and in- crease competition with Insulet. Id. at 5−22. The resulting preliminary injunction issued on October 6, 2023, and enjoined EOFlow “from manufacturing, mar- keting, or selling any product that was designed, devel- oped, or manufactured, in whole or in part, using or relying Case: 24-1137 Document: 49 Page: 4 Filed: 06/17/2024

on the Trade Secrets of Insulet.” J.A. 35−37. EOFlow moved to modify that injunction, citing concerns regarding existing patient populations in international markets. The district court subsequently amended the injunction on Oc- tober 24, 2023, adding limited carveouts for certain patient populations in South Korea, the European Union, and the United Arab Emirates. EOFlow filed a notice of appeal shortly thereafter. Order at *1−2; J.A. 38−41. While this appeal was pending, both parties moved in the district court to further modify the injunction. As a re- sult, a second amended preliminary injunction issued on April 24, 2024, limiting the carveouts contained in the Oc- tober 24, 2023 order. Insulet Corp. v. EOFlow, Co., No. 1:23-cv-11780-FDS (D. Mass. Apr. 24, 2024), ECF No. 361. Oral argument was heard at this court on May 6, 2024. On May 7, 2024, we issued a temporary stay of the October 24, 2023 preliminary injunction pending this decision and further suggested that the district court consider entering a stay of the April 24, 2024 order that is not before us. The district court subsequently stayed the April 24, 2024 order on May 8, 2024. Id. at ECF No. 368. We have jurisdiction over the October 24, 2023 prelim- inary injunction order under 28 U.S.C. § 1292(c)(1). DISCUSSION A preliminary injunction is “an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief.” Winter v. NRDC, Inc., 555 U.S. 7, 22 (2008) (citing Mazurek v. Armstrong, 520 U.S. 968, 972 (1997) (per curiam)). To establish such entitlement, the court must find that “(1) the plaintiff has a likelihood of success on the merits of his claim; (2) the plaintiff does not have an adequate remedy at law such that it will suffer irreparable harm without the injunction; (3) this harm is greater than the injury the defendant will Case: 24-1137 Document: 49 Page: 5 Filed: 06/17/2024

INSULET CORP. v. EOFLOW, CO. LTD. 5

suffer if the injunction is granted; and (4) the injunction will not harm the public interest.” Concrete Mach. Co. v. Classic Lawn Ornaments, Inc., 843 F.2d 600, 611 (1st Cir. 1988). We review a district court’s grant of a preliminary in- junction under the law of the regional circuit. SoClean, Inc. v. Sunset Healthcare Sols., Inc., 52 F.4th 1363, 1367 (Fed. Cir. 2022). Here, that is the First Circuit, which reviews grants of preliminary injunctions for an abuse of discretion. Id.

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