Court to clarify burden of proof

Does burden lie with patentee or licensee?

By Pat Murphy
The Daily Record Newswire
 
BOSTON — The U.S. Supreme Court will decide whether a patentee bears the burden of proving infringement when its licensee brings a declaratory judgment action to establish non-infringement.

The court will review a decision from the U.S. Court of Appeals for the Federal Circuit. In Medtronic, Inc. v. Boston Scientific, Corp., the Federal Circuit decided that the licensee has the burden to prove that its products do not infringe the patent.

The case addresses the allocation of the burden of proof in patent cases brought under MedImmune, Inc. v. Genentech, Inc. (549 U.S. 118). In its 2007 decision, the court ruled that a patent licensee that believes that its products do not infringe the patent and accordingly are not subject to royalty payments is “not required … to break or terminate its … license agreement before seeking a declaratory judgment in federal court that the underlying patent is … not infringed.”

In the case before the Federal Circuit, medical device manufacturer Medtronic sublicensed a cardiac resynchronization therapy (CRT) device. Mirowski Family Ventures, LLC owned the patent on the device. In 2007, after Mirowski complained that several Medtronic devices impaired its CRT patent, Medtronic, in accordance with MedImmune, filed a declaratory judgment action in federal court to establish non -infringement.

Throughout the litigation, the parties disagreed over whether Mirowski, the patentee, bore the burden of proving infringement, or whether Medtronic, the declaratory judgment plaintiff, bore the burden of proving non-infringement.

In 2010, the district court entered a declaratory judgment of non-infringement in favor of Medtronic after applying the general rule that the burden is always on the patentee to show infringement.

However, in 2012 the Federal Circuit reversed, holding that the district court relied on a “legally incorrect” allocation of the burden of proof to find non-infringement.

Writing for a unanimous three-judge panel, Judge Richard Linn explained that relieving Medtronic of the burden of proof under these circumstances would establish a rule allowing licensees “to use MedImmune’s shield as a sword — haling licensors into court and forcing them to assert and prove what had already been resolved by license.”

Linn concluded that “because the declaratory judgment plaintiff is the only party seeking the aid of the court in the circumstances presented here, that party must bear the burden of persuasion. Therefore, this court holds that in the limited circumstance when an infringement counterclaim by a patentee is foreclosed by the continued existence of a license, a licensee seeking a declaratory judgment of noninfringement and of no consequent liability under the license bears the burden of persuasion.”

The U.S. Supreme Court is expected to decide the case next term.

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