Case: 19-2374 Document: 42 Page: 1 Filed: 04/03/2020
United States Court of Appeals for the Federal Circuit ______________________
MYCO INDUSTRIES, INC., Plaintiff/Counter Defendant-Appellee
JOHN R. CHOATE, Counter Defendant-Appellee
v.
BLEPHEX, LLC, Defendant/Counter Plaintiff-Appellant
JAMES RYNERSON, Defendant-Appellant ______________________
2019-2374 ______________________
Appeal from the United States District Court for the Eastern District of Michigan in No. 2:19-cv-10645-GAD- EAS, United States District Judge Gershwin A. Drain. ______________________
Decided: April 3, 2020 ______________________
PETER J. ARMENIO, Quinn Emanuel Urquhart & Sulli- van, LLP, New York, NY, argued for defendant/counter plaintiff-appellant and defendant-appellant. Also repre- sented by MATTHEW D. ROBSON, WILLIAM ADAMS.
CHRISTOPHER C. SMITH, Brooks Kushman PC, Case: 19-2374 Document: 42 Page: 2 Filed: 04/03/2020
Southfield, MI, argued for plaintiff/counter defendant-ap- pellee and counter defendant-appellee. Also represented by THOMAS A. LEWRY, REBECCA JAMIE CANTOR. ______________________
Before NEWMAN, O’MALLEY, and TARANTO, Circuit Judges. O’MALLEY, Circuit Judge. We have jurisdiction over this case because it arises out of allegations of patent infringement. But, in its current posture, it is a case about free speech and a district court’s authority to place prior restraints on that speech. Myco Industries, Inc. (“Myco”) believed its competitor BlephEx, LLC (“BlephEx”) engaged in unprotected speech—making false and misleading statements about Myco’s product and whether it infringed BlephEx’s patent covering such tech- nology, U.S. Patent No. 9,039,718 (the “’718 patent”). This appeal arises from the fact that, in response to Myco’s re- quest, the United States District Court for the Eastern Dis- trict of Michigan preliminarily enjoined BlephEx’s speech. The court granted Myco’s motion for a preliminary injunc- tion to enjoin BlephEx from making allegations of patent infringement and also from threatening litigation against Myco’s potential customers. Myco Indus., Inc. v. BlephEx, LLC, Case No. 19-cv-10645, 2019 WL 4023789 (E.D. Mich. Aug. 27, 2019). BlephEx appeals the district court’s order. Because we find that the court abused its discretion by entering that preliminary injunction, we reverse, vacate, and remand. I. BACKGROUND Because the speech at issue relates to allegations of pa- tent infringement and the good faith of any such allega- tions, we briefly describe the science involved and the ’718 patent claims. Case: 19-2374 Document: 42 Page: 3 Filed: 04/03/2020
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A. The Eyelid Margin and Ocular Disorders The eyelid margin is a portion of the edge of the eyelid which encompasses the site of the eyelashes, the meibo- mian gland orifices, and the gray line. J.A. 718. The eyelid margin is divided into two regions, as demarcated by the gray line: (1) a posterior eyelid margin (“inner edge mar- gin”) 1, including the meibomian gland orifices; and (2) an anterior eyelid margin (“outer edge margin”), including the eyelashes. J.A. 482–83.
J.A. 717.
1 There is an ongoing claim construction dispute be- fore the district court regarding the definition of “inner edge,” as recited by claim 1 of the ’718 patent. J.A. 1100, 1102. Myco concedes, however, that it “does not contest the definiteness of the phrases [in] this appeal” because the plain and ordinary meanings of these terms are “not rele- vant to the issues BlephEx raises in this appeal.” Appellee Br. 12 n.5. Case: 19-2374 Document: 42 Page: 4 Filed: 04/03/2020
There are several ocular diseases that affect the eyelid margin, such as blepharitis, meibomitis, and dry eye syn- drome. ’718 patent, Abstract. Blepharitis, which comes in two forms, is a condition characterized by inflammation of the eyelids and the formation of dandruff-like scales on the eyelashes. J.A. 2–3. Anterior blepharitis affects a portion of the outer edge margin while posterior blepharitis affects a portion of the inner edge margin. J.A. 3. If a patient is diagnosed with eyelid margin disease, a doctor may prescribe a home treatment procedure, possibly in conjunction with antibiotics and/or topical steroids until the disease subsides. ’718 patent, col. 1 ll. 27–32. Home treatment is typically a two-step process. Id., col. 1, ll. 40– 41. The patient first softens the eyelid margin debris by using a warm compress or a specialized liquid solution. Id., col. 1 ll. 40–50. The patient then removes the debris by physically scrubbing the eyelid margin. Id. By cleaning debris from the base of the eyelashes and unclogging the pores of the meibomian glands, the patient improves the overall health of the eyelid margin, thereby reducing symp- toms related to the disorder. Id., col. 1 ll. 50–54. Unfortu- nately, this home treatment procedure is often met with limited success due to the practical difficulties of cleaning one’s own eye with an imprecise instrument, such as a Q- tip or a fingertip. Id., col. 1 ll. 56–59. While attempted self- treatment can temporarily abate a patient’s symptoms, failure to completely treat the affected area allows for “sub- tle continuation of the disease.” Id., col. 2 ll. 3–5. B. U.S. Patent No. 9,039,718 The ’718 patent, entitled “Method and Device for Treating an Ocular Disorder,” is generally directed to a method for treating ocular disorders by “using an electro- mechanical device to move a swab relative to the eye to cre- ate cylindrical movement that impacts debris present at the eyelid margin and effectively removes the debris from the eye to encourage healing and prevent further Case: 19-2374 Document: 42 Page: 5 Filed: 04/03/2020
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digression of the health of the eye.” ’718 patent, Abstract. Put simply, the claimed method involves using an electro- mechanical device with a swab to remove debris from the affected eyelid margin area. Id. Figure 2A of the ’718 pa- tent illustrates the swab of the claimed device treating the lower eyelid margin of a patient:
’718 patent, Figure 2A. i. The ’718 Patent Claims Independent claims 1 and 17, along with dependent claims 14 and 15, are relevant to this appeal and recite: 1. A method for treating an eye for an ocular disor- der with a swab operably connected to an electro- mechanical device, wherein the eye has an eyelid margin and includes a removable debris, the method comprising; effecting movement of the swab relative to the electromechanical device, the swab having at least a portion thereof configured to access an inner edge portion of the eyelid margin; Case: 19-2374 Document: 42 Page: 6 Filed: 04/03/2020
while the swab is being moved by the elec- tromechanical device, contacting a portion of the eye between the eyelashes and the inner edge of the eyelid margin that in- cludes the removable debris from the swab thereby impacting the debris with the swab to remove debris from the eye. *** 14. The method of claim 1 further comprising: accessing at least an inner edge portion of the eyelid margin with swab. 15. The method of claim 14 further comprising: contacting the inner edge portion of the eyelid margin with the swab. *** 17. A method of treating an eye for an ocular disor- der with a swab operably connected to an electro- mechanical device, wherein the eye has an eyelid margin and includes a removable debris, the method comprising; effecting movement of the swab relative to the electromechanical device; while the swab is being moved by the elec- tromechanical device, contacting at least an inner edge portion of the eyelid margin that includes the removable debris with the swab thereby impacting the debris with the swab to remove debris from the eye. ’718 patent, col. 7 l. 30–col. 8 l. 57. ii. Prosecution History U.S. Patent Application No. 13/556,729, which issued as the ’718 patent, was filed on July 24, 2012. As originally Case: 19-2374 Document: 42 Page: 7 Filed: 04/03/2020
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filed, claim 1 recited a method for treating an eye for an ocular disorder with a swab connected to an electrome- chanical device, with the swab “contacting a portion of the eye that includes the removable debris.” J.A. 154 (empha- sis added). During prosecution, the examiner issued a non-final of- fice action rejecting claim 1 as anticipated by U.S. Patent Application No. 2007/0060988 (“Grenon”). J.A. 296–299. According to the examiner, the reference disclosed a method for treating an ocular disorder with a swab con- nected to an electromechanical device. J.A. 297. During an examiner interview, however, the applicant distin- guished its invention from Grenon, contending that, unlike Grenon, the claimed swab “contacts the inner surface of the eyelid or eyelid margin.” J.A. 321. The examiner “agreed that such a claim limitation would overcome Grennon [sic], since one would not use Grennon [sic] to contact the inner surface of the eyelid, as this would also result in the device in Grennon [sic] contacting the eyeball.” J.A. 321. Following the examiner interview, the applicant sub- mitted amendments to the original claims. One of those amendments added a limitation to claim 1: “the swab hav- ing at least a portion thereof configured to access an inner edge portion of the eyelid margin.” J.A. 324. The applicant explained that the added limitation overcame Grenon be- cause “Grenon fails to disclose a swab having a portion con- figured to access an inner edge portion of the eyelid margin of the eye,” and “as agreed during the [examiner interview,] the apparatus of Grenon is not capable of contacting an in- ner edge portion of an eyelid margin.” J.A. 331. The appli- cant also added new claims, including then-claim 28 (which issued as claim 15) and then-claim 29 (which issued as claim 17). J.A. 326. Then-claim 28 recited “contacting the inner edge portion of the eyelid margin with the swab,” while then-claim 19 included “contacting at least an inner edge portion of the eyelid margin.” J.A. 326. Case: 19-2374 Document: 42 Page: 8 Filed: 04/03/2020
Following submission of the amendments, the exam- iner conducted another interview and “discussed a poten- tial Examiner’s Amendment to incorporate the language regarding ‘contacting at least an inner edge portion of the eyelid margin’ of claim 29 into claim 1.” J.A. 338. The ap- plicant’s patent attorney, however, responded that he would need to discuss this potential amendment with his client and thus, “no agreement was reached on the Exam- iner’s Amendment at this time.” J.A. 338. Ultimately, the potential Examiner’s Amendment was not incorporated into claim 1. Instead, to receive a notice of allowance, the applicant added another limitation to claim 1: “contacting a portion of the eye between the eye lashes and the inner edge of the eyelid margin.” J.A. 392. The ’718 patent is- sued on May 26, 2015. C. Procedural History i. The History of Myco and BlephEx In August 2012, after filing U.S. Patent Application No. 13/556,729, the ’718 patent inventor, Dr. James Rynerson, contacted John Choate. J.A. 110. The men entered into a partnership. Choate agreed to help develop a commercial product based on the electromechanical device disclosed in the ’718 patent. J.A. 110–111. The final commercial prod- uct, a device used to clean the eyelid margin by practicing the methods claimed in the ’718 patent, was named the BlephEx (“the BlephEx product”) and was brought to mar- ket in 2013. J.A. 111, 723. In January 2014, Choate ended this relationship with Rynerson, apparently on less than cordial terms. J.A. 111. Sometime later, Choate became chairman of Myco Industries, Inc. J.A. 109. In 2019, Myco began marketing the AB Max. J.A. 88, 109. The AB Max is an FDA registered device used by med- ical practitioners to treat anterior blepharitis. J.A. 109– 110. The AB Max is an attachment for an Algerbrush II handle, which is “used by ophthalmologists, ER physicians and, [sic] optometrists who are trained and licensed to Case: 19-2374 Document: 42 Page: 9 Filed: 04/03/2020
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remove foreign bodies from the eye of a patient.” J.A. 109– 110. In 2019, Rynerson and Choate both hosted booths at the Southern Educational Congress of Optometry (“SECO”) 2019 trade show in New Orleans. J.A. 112. Dur- ing the trade show, Myco displayed its AB Max tool and handed out materials explaining the functionality and use of the tool to attendees. J.A. 112. None of the materials for the AB Max tool promoted or marketed the AB Max for treating posterior blepharitis, only anterior blepharitis. J.A. 112. Rynerson then approached the Myco booth and expressed concern about the AB Max device. J.A. 113. Choate contends that, upon observing the AB Max de- vice, Rynerson became hostile and accused the AB Max de- vice of infringing the ’718 patent. J.A. 113. According to Choate, Rynerson made loud accusations of infringement within earshot of prospective customers, while videotaping at least part of the encounter on his cell phone. J.A. 113. A third party, Dr. Adam Farkas, emailed Choate after SECO 2019, informing Choate that he overhead Rynerson at the BlephEx booth repeating his claims to potential cus- tomers that the AB Max infringed his ’718 patent and that he would be “taking action.” J.A. 113, 522. Rynerson’s version of the events is more subdued. Ryn- erson agrees that he saw Choate at the SECO 2019 show, but denies telling Choate that the AB Max infringed the ’718 patent. J.A. 575. Instead, Rynerson contends that he merely asked if Choate thought the AB Max product might infringe the ’718 patent. J.A. 575. Rynerson maintains that he did not threaten to sue anyone for patent infringe- ment and was only looking to gain information about the AB Max because he thought that it looked very similar to the BlephEx product. J.A. 575. Rynerson states that he accepted a Doctor’s Brochure for the AB Max from Choate, took photos of Myco’s display booth, and promptly left. J.A. 575. Rynerson further maintains that he did not make any Case: 19-2374 Document: 42 Page: 10 Filed: 04/03/2020
video recordings, send Myco or Choate any form of corre- spondence alleging that the AB Max product infringes the ’718 patent, or threaten any customer with patent infringe- ment. J.A. 575–76. ii. Myco’s Declaratory Judgment Action In March 2019, Myco filed a declaratory judgment ac- tion against BlephEx in the U.S. District Court for the Eastern District of Michigan. J.A. 29. Myco sought a de- claratory judgment that it has not been and is not directly, indirectly, or contributorily infringing the ’718 patent; a de- claratory judgment that the claims of the ’718 patent are invalid under 35 U.S.C. §§ 102, 103, and/or 112; and in- junctive and monetary relief under Michigan and federal unfair competition law on the basis that Rynerson made patent infringement allegations regarding the AB Max at SECO 2019 in bad faith. J.A. 51–55. Shortly after filing an amended complaint against BlephEx, Myco filed a motion for a preliminary injunction, seeking to bar BlephEx from (1) “Making false allegations that Myco’s AB Max infringes the ’718 patent” and; (2) “making baseless threats against Myco’s medical-prac- titioner potential customers of AB Max.” J.A. 104. In its motion, Myco alleged that it had a strong likelihood of suc- cess on the merits of its patent non-infringement claims be- cause, inter alia, (1) “[d]uring prosecution of the application for the ’718 patent, Rynerson expressly limited the patent claims to a method of treating posterior blepha- ritis,” whereas Myco sells and promotes the AB Max “only for treating anterior blepharitis”; and (2) Myco’s medical- practitioner customers are immune from liability under 35 U.S.C. § 287(c)(1). J.A. 92–99 (emphasis added). In re- sponse, BlephEx disputed Myco’s assertion that the claims of the ’718 patent are limited to treating posterior blepha- ritis, and argued that Myco’s § 287(c)(1) medical immunity argument improperly relied on the assumption that all di- rect infringers of the AB Max are medical professionals. Case: 19-2374 Document: 42 Page: 11 Filed: 04/03/2020
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J.A. 545–557. Briefing on the motion concluded in April 2019. J.A. 31. A few months later, BlephEx moved the district court for leave to file supplemental briefing. J.A. 32–33. In its supplemental briefing, BlephEx noted that federal law re- quires a showing of bad faith in order to bar patentee speech and argued that its counterclaims of infringement demonstrate its objective good faith. J.A. 774–79. Myco opposed BlephEx’s motion, arguing that it failed to raise any new facts justifying additional briefing and consisted primarily of new arguments and case law that BlephEx should have asserted during the briefing period. J.A. 1006–1008. The district court denied BlephEx’s motion for leave to file a supplemental brief. J.A. 2, 34. iii. The District Court’s Preliminary Injunction Opinion On August 27, 2019, the district court granted Myco’s amended motion for a preliminary injunction and enjoined BlephEx, its officers, agents, and those in active concert with BlephEx “from making allegations of patent infringe- ment and from threatening litigation against [Myco’s] po- tential customers.” Myco, 2019 WL 4023789, at *9. In its opinion, the district court identified and discussed four pre- liminary injunction factors, as enumerated by the 6th Cir- cuit: (1) likelihood of success on the merits; (2) irreparable injury without the injunction; (3) substantial harm to oth- ers; and (4) public interest. Id. at *3 (citing Certified Res- toration Dry Cleaning Network, L.L.C. v. Tenke Corp., 511 F.3d 535, 542 (6th Cir. 2007)). Under the first factor, likelihood of success on the mer- its, the district court discussed each of Myco’s non-infringe- ment and unfair competition claims. Myco, 2019 WL 4023789, at *3–7. The district court’s analysis of Myco’s non-infringement claim considered direct infringement, ac- tive inducement, and contributory infringement. Id. at *3– 6. With respect to its direct infringement discussion, the Case: 19-2374 Document: 42 Page: 12 Filed: 04/03/2020
district court focused almost entirely on whether the claimed method recited in claim 1 is limited to treating pos- terior blepharitis. Id. at *3–5. According to the court, “the ’718 patent routinely describes the swab of the Bleph[E]x contacting the ‘inner edge portion of the eyelid margin’” and “effectively describe[s] the treatment of posterior blepharitis, because posterior blepharitis affects the inner edge of the eyelid.” Id. at *4. The district court also noted that “adding the ‘inner edge portion of the eyelid margin’ language was necessary in order for the PTO to issue a pa- tent on the Bleph[E]x.” Id. Thus, the district court deter- mined that the ’718 patent claims are limited to “treatment of posterior blepharitis.” Id. at *5. Because the district court found that “the ’718 patent[] is for use for the treat- ment of posterior blepharitis” and “the AB Max is for the treatment of anterior blepharitis,” the district court con- cluded “that Myco has demonstrated a strong likelihood of success on its claim that it does not directly infringe the ’718 patent.” Id. at *4–5. The district court also determined that Myco had demonstrated a “strong likelihood of success” that Myco did not indirectly infringe any claims of the ’718 patent. As related to induced infringement, the district court held that “the record does not show that [Myco] or a third party di- rectly infringed the ’718 patent,” or that “[Myco] induced any infringing acts.” Id. at *5. This conclusion was de- pendent on the district court’s determination that the ’718 patent claims are limited to treatment of posterior blepha- ritis. In concluding that Myco did not induce any infring- ing act, the district court relied on a video of Choate’s statements at the SECO conference, which demonstrated Choate marketing the AB Max as a treatment for anterior blepharitis. Id. The court therefore concluded “that there Case: 19-2374 Document: 42 Page: 13 Filed: 04/03/2020
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is a strong likelihood of success on Plaintiff’s contention that it did not induce infringement.” Id. 2 Finally, the district court maintained that any custom- ers of the AB Max who are medical practitioners are not liable pursuant to § 287(c)(1) of the Patent Act. Id. at *6. And, because the court had already determined that “the AB Max does not directly or indirectly infringe the ’718 pa- tent,” it concluded that “there is also a strong likelihood of success on [Myco]’s contention that Myco customers who are not medical practitioners are also not liable for in- fringement.” Id. After determining that (1) Myco had demonstrated a strong likelihood of success on its non-infringement patent claim 3; (2) Myco had shown that it would suffer irreparable
2 With respect to contributory infringement, the dis- trict court determined that, although Myco’s AB Max de- vice could be used “for the treatment of posterior blepharitis, which would infringe” on certain claims of the ’718 patent, “practitioners could also solely use [it] for the treatment of anterior blepharitis, which does not infringe on the ’718 patent.” Myco, 2019 WL 4023789 at *6. “[B]ecause the AB Max has a substantial non-infringing use,” the district court concluded that Myco demonstrated a strong likelihood of success that it is not liable for con- tributory infringement. Id. While the district court also discussed concepts of contributory infringement, because BlephEx does not push that theory of infringement on ap- peal, we decline to address it. 3 With respect to Myco’s unfair competition claim, the district court found that “[t]he record does not establish that [Myco]’s version of the facts is more credible or accu- rate tha[n] [BlephEx]’s.” Myco, 2019 WL 4023789, at *7. Accordingly, the district court held that it could not “estab- lish that Defendant made any false or misleading state- ments about the AB Max” and concluded that Myco had Case: 19-2374 Document: 42 Page: 14 Filed: 04/03/2020
harm absent a preliminary injunction; (3) BlephEx had not shown that it would face substantial harm if a preliminary injunction issued; and (4) both parties’ public interest con- siderations were equal, the district court concluded that upon balance, a preliminary injunction was appropriate. Id. at *8–9. The district court issued a preliminary injunc- tion “enjoining [BlephEx], its officers, agents, and those in active concert with [BlephEx] from making allegations of patent infringement and threatening litigation against [Myco]’s potential customers.” Id. at *8. BlephEx timely appealed the district court’s prelimi- nary injunction order. We have jurisdiction over this ap- peal pursuant to 28 U.S.C. § 1292(a)(1). II. DISCUSSION We review a district court’s grant or denial of a prelim- inary injunction using the law of the regional circuit. Ma- com Tech. Sols. Holdings, Inc. v. Infineon Techs. AG, 881 F.3d 1323, 1328 (Fed. Cir. 2018). Under Sixth Circuit law, we review the district court’s ultimate determination as to whether the preliminary injunction factors weigh in favor of granting preliminary injunctive relief for an abuse of dis- cretion. Tumblebus Inc. v. Cranmer, 399 F.3d 754, 760 (6th Cir. 2005). The question of whether a movant is likely to succeed on the merits is a question of law, which the Sixth Circuit reviews de novo. Id.
“not demonstrate[d] a strong likelihood of success on its un- fair competition claims.” Id. The district court’s likelihood of success determination on Myco’s unfair competition claim is not at issue on appeal, though its factual finding regarding the nature of BlephEx’s statements is relevant to the questions we address. Case: 19-2374 Document: 42 Page: 15 Filed: 04/03/2020
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A. The Requirement of “Bad Faith” When considering a motion for a preliminary injunc- tion, courts must balance: (1) Whether the movant has a strong likelihood of success on the merits; (2) Whether the movant would suffer irreparable injury without the injunction; (3) Whether the issuance of the injunction would cause substantial harm to others; and (4) Whether the public interest would be served by issuance of the injunction. Id. But when a preliminary injunction prevents a patentee from communicating its patent rights, a court applies “fed- eral patent law and precedent relating to the giving of no- tice of patent rights.” GP Indus., Inc. v. Eran Indus., Inc., 500 F.3d 1369, 1373 (Fed. Cir. 2007). In such cases, the grant of a preliminary injunction is reviewed “in the con- text of whether, under applicable federal law, the notice of patent rights was properly given.” Id. We have further held that “federal law requires a showing of bad faith” be- fore a patentee can be enjoined from communicating his pa- tent rights. Id. A showing of “bad faith” must be supported by a finding that the claims asserted were objectively baseless. See id. at 1374. An asserted claim is objectively baseless if no rea- sonable litigant could realistically expect success on the merits. Id. (citing Prof’l Real Estate Investors, Inc. v. Co- lumbia Pictures Indus., Inc., 508 U.S. 49, 60 (1993)). i. The District Court Enjoined Patentee Speech Without a Finding of Bad Faith The district court abused its discretion when it granted a preliminary injunction enjoining patentee speech with- out a finding of bad faith. Although a district court’s Case: 19-2374 Document: 42 Page: 16 Filed: 04/03/2020
discretion to enter a preliminary injunction is entitled to substantial deference, the patent laws permit a patentee to inform a potential infringer of the existence of its patent. See, e.g., 35 U.S.C. § 287 (“Patentees . . . may give notice to the public that [a patented article] is patented . . . .”); Va. Panel Corp. v. MAC Panel Co., 133 F.3d 860, 869 (Fed. Cir. 1997) (“[A] patentee must be allowed to make its rights known to a potential infringer so that the latter can deter- mine whether to cease its allegedly infringing activities, negotiate a license if one is offered, or decide to run the risk of liability and/or the imposition of an injunction.”). There- fore, “communication to possible infringers concerning pa- tent rights is not improper if the patent holder has a good faith belief in the accuracy of the communication.” Mikohn Gaming Corp. v. Acres Gaming, Inc., 165 F.3d 891, 897 (Fed. Cir. 1998). In this case, the district court neither made a finding of bad faith nor even adverted to the re- quirement. To the extent the court made any factual find- ings relevant to bad faith, moreover, the court expressly declined to find that any of BlephEx’s statements were ei- ther false or misleading. Myco, 2019 WL 4023789, at *7. This alone warrants reversal. 4 See Coursey v. Comm’r of Soc. Sec., 843 F.3d 1095, 1097 (6th Cir. 2016) (“A district court abuses its discretion when it relies on clearly
4 Myco argues that BlephEx waived its argument that a showing of bad faith is a prerequisite to injunctive relief. Appellee Br. 26–28. We disagree. “While a party can waive his or her ability to appeal a ruling for failure to object, there can be no waiver here of the Judge’s duty to apply the correct legal standard.” United States v. Ali, 508 F.3d 136, 144 n.9 (3d Cir. 2007); see also Brown v. Smith, 551 F.3d 424, 428 n.2 (6th Cir. 2008) (“[T]he district court was ill-served in this regard by the petitioning party, who never argued that AEDPA deference did not apply until this appeal. Nevertheless, a party cannot ‘waive’ the proper standard of review by failing to argue it.”). Case: 19-2374 Document: 42 Page: 17 Filed: 04/03/2020
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erroneous findings of fact, when it improperly applies the law, or uses an erroneous legal standard.”). ii. Section 287(c) Does Not Mean That Allegations of Infringement Directed to Medical Practitioners Are Made in Bad Faith Myco does not dispute that the district court failed to make an express finding of bad faith. Myco maintains, however, that the district court’s analysis was appropriate because the injunction “merely precludes BlephEx from al- leging infringement and threatening litigation against Myco’s AB Max potential customers,” who are purportedly immune from infringement under 35 U.S.C. § 287(c). Ap- pellee Br. 23. Myco argues that, under this narrower scope, “threatening [Myco’s potential customers] with infringe- ment of the ’718 patent is objectively baseless and in bad faith.” Myco asks us to infer a finding of bad faith from the language of the injunction itself. But the injunction is not limited to allegations of patent infringement against Myco’s potential customers. Rather, the district court’s injunction enjoins BlephEx from both: (1) making allegations of patent infringement in general; and (2) threatening litigation against Myco’s potential cus- tomers. Myco, 2019 WL 4023789, at *8–9. In addressing whether Myco demonstrated a strong likelihood of success with respect to its ’718 patent non-infringement claims, the court considered whether “[Myco] or a third party” directly or indirectly infringed the method claims. Id. at *5. If the district court’s injunction was as narrow as Myco now claims, the court would have restricted its analysis to a dis- cussion of induced infringement based on the actions of Myco’s medical-practitioner customers. Indeed, the record reflects that Myco sought a broader injunction. For exam- ple, Myco’s motion for a preliminary injunction “asks the Court to enjoin Bleph[E]x, its officers, agents, and those in active concert with it, from (1) making false allegations that Myco’s AB Max infringes the ’718 patent, and Case: 19-2374 Document: 42 Page: 18 Filed: 04/03/2020
(2) making baseless threats to sue Myco’s medical-practi- tioner potential customers of AB Max.” J.A. 104. The plain text of Myco’s request makes clear that Myco not only sought to preclude BlephEx from communicating with its medical-practitioner customers, but from making any “false allegations that Myco’s AB Max infringes the ’718 patent.” Id. 5 Even assuming the district court’s injunction is nar- rowly tailored to allegations of infringement and threats of litigation against Myco’s potential customers, the “medical practitioner immunity” provision of § 287(c) does not blanketly preclude a patent owner from stating that a med- ical practitioner’s performance of a medical activity in- fringes a patent. Section 287(c) recites: With respect to a medical practitioner’s perfor- mance of a medical activity that constitutes an in- fringement under section 271(a) or (b), the provisions of sections 281, 283, 284, and 285 shall not apply against the medical practitioner or against a related health care entity with respect to such medical activity. 35 U.S.C. § 287(c)(1). The plain text of the statute does not state that a med- ical practitioner is “immune from infringement,” as the dis- trict court found and Myco urges. Rather, the text establishes that, if a medical practitioner’s performance of a medical activity infringes a patent claim, the patentee cannot seek a remedy for such infringement against the practitioner or related health care entity. See 35 U.S.C.
5 As noted above, while Myco only sought to enjoin false allegations regarding patent infringement, the dis- trict court expressly found that the record did not permit a conclusion that any of BlephEx’s claims were either false or misleading. Case: 19-2374 Document: 42 Page: 19 Filed: 04/03/2020
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§§ 281 (remedies), 283 (injunctions), 284 (damages), 285 (attorneys’ fees). The act provides immunity to certain in- fringers, but it does not render them non-infringers. As we have explained, moreover, a medical practitioner’s direct infringement of a method claim may form the basis for a claim of indirect infringement against a medical device manufacturer. Barry v. Medtronic, Inc., 914 F.3d 1310, 1334 (Fed. Cir. 2019) (finding that “[s]ubstantial evidence supports the jury’s finding of underlying direct infringe- ment by surgeons,” as relevant to the jury’s finding that Medtronic induced others to infringe). Accordingly, Myco cannot simply hide under the umbrella of § 287(c) and ar- gue that any alleged statements regarding medical practi- tioner infringement were made in bad faith. Rather, Myco must establish that BlephEx’s patent infringement state- ments, whether made generally or to medical practitioners, were objectively baseless. With respect to threats of litigation against Myco’s po- tential customers, there is no evidence that BlephEx or Rynerson ever made such a threat. The parties submitted conflicting testimony regarding Rynerson’s actions at the SECO 2019 trade show, but even Choate’s memory of the events fails to recall Rynerson threatening Myco’s potential customers with either patent infringement or litigation re- lating thereto. J.A. 113 (“Dr. Rynerson approached the Myco booth and became hostile and combative stating that the AB Max infringes Dr. Rynerson’s patent.”). And when Dr. Farkas, a fellow SECO 2019 attendee, sent an email to describe his observations of Rynerson’s statements, he could only report that “[Rynerson] said that the AB Max technology was ‘totally infringing on his patents’ and that he’d be ‘taking action.’” J.A. 522. Myco insists that Dr. Farkas’s email demonstrates that BlephEx threatened potential customers with litigation be- cause a customer, overhearing Rynerson’s intent to “take action,” would infer a threat of litigation. See Oral Arg. at 28:50 (“A doctor hearing a statement that ‘I’m going to take Case: 19-2374 Document: 42 Page: 20 Filed: 04/03/2020
action on this patent’ that covers exactly what [she does] in [her] office—I think . . . that would be a threat on a doctor, or could be taken as a threat on a doctor, certainly.”), http://oralarguments.cafc.uscourts.gov/default.aspx?fl= 2019-2374.mp3. But Myco’s argument asks the court to as- sume, without any supporting evidence, that a doctor would have interpreted Rynerson’s general statements about the AB Max as both an accusation of patent infringe- ment and a threat of litigation against the doctor herself. Because the record lacks any evidence that BlephEx or Rynerson “threaten[ed] [Myco’s potential customers] with infringement of the ’718 patent” or, more specifically, with litigation relating thereto, Myco’s implied “bad faith” ar- gument fails. Appellee Br. 23. Where there was no finding of bad faith, let alone an acknowledgment of that require- ment, the district court’s decision to enjoin BlephEx’s pa- tent speech was an abuse of discretion. Myco finally argues that, regardless of whether the dis- trict court made a finding of bad faith—either express or implied—the district court properly enjoined BlephEx from making general allegations of infringement because “[the Federal Circuit] has affirmed the grant of an injunction to plaintiffs in patent-based declaratory judgment cases.” Ap- pellee Resp. Br. 29. In support of its argument, Myco cites to Unitronics (1989) (R”G) Ltd. v. Gharb, 318 Fed. App’x 902 (Fed. Cir. 2008), where the district court granted Unitronics’ summary judgment motion of non-infringe- ment and, as part of the final judgment, enjoined Gharb from “threatening Unitronics and its customers with in- fringement litigation.” 318 Fed. Appx. at 903–04. In a non- precedential decision, we affirmed the district court’s final judgment of non-infringement, addressing the merits of the infringement issue—not the propriety of its injunction. Id. at 905. Unitronics does not address the injunction issue at all and does not establish precedent, contrary to GP Indus- tries, that a district court may enjoin patentee speech with- out a finding of bad faith. See, e.g., Elbit Sys. Land & C4I Case: 19-2374 Document: 42 Page: 21 Filed: 04/03/2020
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Ltd. v. Hughes Network Syst., LLC, 927 F.3d 1292, 1305 (Fed. Cir. 2019); Arthrex, Inc. v. Smith & Nephew, Inc., 880 F.3d 1345, 1349 (Fed. Cir. 2018); Special Devices, Inc. v. OEA, Inc., 269 F.3d 1340, 1346 (Fed. Cir. 2001). iii. The District Court’s Conclusion that Myco Has a “Strong Likelihood of Success on the Merits” of its Non-Infringement Claim Must Be Vacated To the extent the court enjoined general allegations of infringement—no matter where directed—that injunction is predicated on the court’s conclusion that use of Myco’s product likely does not directly infringe the claims of the ’718 patent. That conclusion, like all conclusions regarding infringement, could only be reached after a two-step pro- cess: a construction of the claims of the patent and a con- clusion that use of BlephEx’s product does not likely read on those claims. 6 Myco, 2019 WL 4023789, at *4–5. But the key predicate for the court’s finding that use of the AB Max likely does not directly infringe the ’718 patent is the conclusion that the AB Max is promoted for the treatment of anterior blepharitis, while the claims of ’718 patent are directed to posterior blepharitis. Id. at *5. There are sev- eral problems with that predicate. The court’s claim construction that limits the scope of the claims to the treatment of posterior blepharitis is faulty
6 Although Myco argues in its brief that the district court “did not construe any claim terms to decide the pre- liminary injunction motion,” Appellee Br. 30, it conceded during oral argument that the district court necessarily conducted claim construction in order to determine whether Myco directly or indirectly infringed the ’718 pa- tent claims. See Oral Arg. at 25:38 (“I don’t disagree that for purposes of finding whether the court erred in finding non-infringement, the court will have to look at the mean- ing of the term, the context of the limitation, specifically.”). Case: 19-2374 Document: 42 Page: 22 Filed: 04/03/2020
in a number of ways, ignoring key governing principles of law. In concluding that use of the AB Max likely does not infringe the ’718 patent, the district court determined that the ’718 patent claims are limited to “the treatment of pos- terior blepharitis” because “the ’718 patent routinely de- scribes the swab of the Bleph[E]x contacting the ‘inner edge portion of the eyelid margin.’” Id. at *4–5. But the plain language of the ’718 patent claims does not state that the swab must contact the inner edge or that the claimed method is limited to treatment of posterior blepharitis. For example, claim 1 recites a swab “having at least a portion thereof configured to access an inner edge portion of the eyelid margin,” but does not state that any contact by the swab must be limited to the inner edge portion of the eyelid margin. ’718 patent, col. 7 ll. 34–37. And unlike claims 14, 15, and 17, claim 1 does not require contacting or accessing “at least an inner edge portion of the eyelid margin.” Com- pare ’718 patent, col. 7 ll. 34–37, with ’718 patent, col. 8 l. 40, and ’718 patent, col. 8 l. 43, and ’718 patent, col. 8 ll. 54–55. Accordingly, reading such a limitation into claim 1 would appear to violate the doctrine of claim differentiation and render dependent claims 14, 15, and 17 superfluous. See Aspex Eyewear, Inc. v. Marchon Eyewear, Inc., 672 F.3d 1335, 1348 (Fed. Cir. 2012) (“[T]he presence of a dependent claim that adds a particular limitation gives rise to a pre- sumption that the limitation in question is not present in the independent claim.”). 7
7 We also remind the district court that limitations from different dependent claims should not be interpreted as if they were general statements of disavowal from the written description. Compare Myco, 2019 WL 4023789, at *2 (combining separate limitations from claims 1, 14, 15, and 17 as evidence that “the patent consistently states that the Bleph[E]x is for use with the ‘inner edge portion of the eyelid margin.’”). Case: 19-2374 Document: 42 Page: 23 Filed: 04/03/2020
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During prosecution of the patent application, the appli- cant rejected the examiner’s suggestion to add “contacting at least an inner edge portion of the eyelid margin” to claim 1. J.A. 331, 338, 392. Instead, the applicant and examiner compromised with the limitation, “contacting a portion of the eye between the eye lashes and the inner edge of the eyelid margin,” implying that claim 1 recites a method of using a device with the capability of accessing the inner edge, but not requiring such contact during use. J.A. 392. Based on this back-and-forth, the court concluded that the “inner edge portion of the eyelid” language was important to allowance of the patent claims, and determined that the applicant’s statements and amendments had narrowed the scope of the claims. J.A. 3, 12. But the court did not decide whether the patentee had clearly and unmistakably disa- vowed the claim scope, as would be required to depart from the meaning of the term provided in the claims and the written description. See Sorensen v. Int’l Trade Comm’n, 427 F.3d 1375, 1378–79 (Fed. Cir. 2005) (“Disclaimers based on disavowing actions or statements during prosecu- tion . . . must be both clear and unmistakable.”). Such a finding would be necessary before prosecution history may constitute a disclaimer of claim scope. 8
8 That is not to say that prosecution actions or state- ments must be “clear and unmistakable” in order to inform a court's claim construction. If a claim term is ambiguous based on the plain language of the claims and the written description, we may look to the prosecution history for guidance. For example, in Personalized Media Comm'cns, LLC v. Apple, Inc., Case No. 18-1936 (Fed. Cir. Mar. 13, 2020), we held that an applicant's ”repeated and consistent statements during prosecution, along with its amendment to the same effect, are decisive as to the meaning of the disputed claim term—even if those statements do not rise to the level of a disclaimer.” Slip op. at 18. Our precedent Case: 19-2374 Document: 42 Page: 24 Filed: 04/03/2020
The district court’s non-infringement analysis also fre- quently conflates the invention claimed in the ’718 patent with the BlephEx product. See, e.g., Myco, 2019 WL 4023789, at *4 (“However, the ’718 patent routinely de- scribes the swab of the Bleph[E]x contacting the ‘inner edge portion of the eyelid margin.’”); id. (“Further, adding the ‘inner edge portion of the eyelid margin’ language was nec- essary in order for the PTO to issue a patent on the Bleph[E]x.”); id. at *5 (“Defendant’s Bleph[Ex] tool, accord- ing to the ’718 patent, is for use for the treatment of poste- rior blepharitis.”). The law is clear, however, that “infringement is determined on the basis of the claims, not on the basis of a comparison with the patentee’s commer- cial embodiment of the claimed invention.” Int’l Visual Corp. v. Crown Metal Mfg. Co., 991 F.2d 768, 772 (quoting ACS Hosp. Sys., Inc. v. Montefiore Hosp., 732 F.2d 1572, 1578 (Fed. Cir. 1984)). Similarly, claim construction, from which an infringement analysis depends, focuses on the re- cited limitations of the claims, not on the features of a com- mercial embodiment of the invention. While we “will not lightly intrude upon a district court’s discretionary decision to issue only a tentative claim con- struction and to base its resolution of a preliminary injunc- tion motion upon that tentative claim construction,” Jack Guttman, Inc. v. Kopykake Enters., Inc., 302 F.3d 1352, 1361 (Fed. Cir. 2002), our conclusion that there are errors in the claim construction analysis employed requires that we vacate that claim construction and remand for further
addressing the general role of intrinsic evidence in claim construction, however, can be distinguished from the doc- trine of prosecution disclaimer, wherein a patentee may narrow the scope of a claim term after he has clearly and unmistakably disavowed a certain meaning to receive a no- tice of allowance. Tech. Props. Ltd. LLC v. Huawei Techs. Co., 849 F.3d 1349, 1357-58 (Fed. Cir. 2017). Case: 19-2374 Document: 42 Page: 25 Filed: 04/03/2020
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consideration of what precisely is claimed in the claims of the ’718 patent. Vacating the court’s claim construction ne- cessitates that we also vacate the court’s finding regarding Myco’s likelihood of success on its non-infringement con- tentions. In turn, that requires that we vacate the court’s preliminary injunction with respect to BlephEx’s ability to make generalized allegations of infringement with respect to the’718 patent. III. CONCLUSION Speech is not to be enjoined lightly. Here, there is not even a finding, let alone a finding supported by evidence and a correct view of the law, that the speech restrained was either false or misleading. The district court abused its discretion when it granted a preliminary injunction en- joining BlephEx from making allegations of patent in- fringement without a finding of bad faith and with no adequate basis to conclude that allegations of patent in- fringement would be false or misleading. It also abused its discretion in enjoining BlephEx from threatening Myco’s potential customers with litigation where there was not only no finding of bad faith but no evidence in the record that any such threats had even been made. We therefore reverse and vacate the district court’s preliminary injunc- tion, and remand. REVERSED, VACATED, AND REMANDED COSTS No costs.