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Thorne Research v. Atlantic Pro-Nutrients

United States District Court, D. Utah

May 29, 2018

THORNE RESEARCH, INC. and SOFTGEL FORMULATORS, INC., Plaintiffs,
v.
XYMOGEN, INC., Defendant.

          MEMORANDUM DECISION AND ORDER DENYING PLAINTIFFS' MOTIONS FOR NEW TRIAL, DENYING DEFENDANT'S MOTION TO STRIKE AND MOTION FOR ATTORNEY'S FEES, AND GRANTING PLAINTIFFS' MOTION TO ALTER JUDGMENT

          TED STEWART JUDGE

         This matter is before the Court on motions from both parties. Plaintiffs filed three motions for new trial (collectively, the “New Trial Motions”) and a Motion to Alter Judgment. Defendant filed a Motion to Strike Plaintiffs' Motions for New Trial for Failure to Comply with Page Limitations and a Motion for Attorney Fees. For the following reasons, the Court will deny the New Trial Motions and Defendant's Motions. However, the Court will grant Plaintiffs' Motion to Alter Judgment.

         I. BACKGROUND

         Softgel Formulators, Inc. owns United States Patent No. 8, 491, 888, titled “Highly Absorbable Coenzyme Q10 Composition and Method of Producing Same” (the “‘888 patent”). The patent was exclusively licensed to Thorne Research, Inc. (“Thorne”) by Softgel Formulators on August 1, 2011. The patent issued on July 23, 2013, and on August 22, 2013, Thorne and Softgel Formulators (collectively, “Thorne”) filed this lawsuit against Xymogen for infringement of the ‘888 patent.

         On February 20, 2018, following a six-day trial, the jury found that Xymogen's accused products did not infringe claim 1 or claim 5 of the ‘888 patent, and that both claims were invalid due to derivation and improper inventorship. Thorne now seeks a new trial based on: (1) the Court's rulings and instruction on the “non-crystalline” limitation; (2) insufficiency of the evidence to support derivation and noninfringement; and (3) inconsistency of the jury's verdict. Thorne also seeks to have the Judgment amended to state that claims 1 and 5 are invalid, rather than stating that the entire patent is invalid. In response, Xymogen filed a Motion to Strike the New Trial Motions for failure to comply with the page limitations set out in DUCivR 7-1(a)(3)(C). Xymogen is also seeking attorney's fees under 35 U.S.C. § 285.

         II. DISCUSSION

         A. Xymogen's Motion to Strike

         DUCivR 7-1(a)(3)(C) provides that a motion for new trial, “must not exceed 2, 500 words, or in the alternative, ten (10) pages.” “Exceptions are rarely granted and only upon a showing of good cause.”[1] “When there is no federal rule pertaining to a particular subject or issue, federal judges may regulate the practice of law in their courts ‘in any manner consistent with federal law . . . and local rules of the district.'”[2] “No sanction or other disadvantage may be imposed for noncompliance with any requirement not in federal law, federal rules, or the local rules unless the alleged violator has been furnished in the particular case with actual notice of the requirement.”[3]

         According to Xymogen, Thorne attempted to skirt the Court's page limitation by filing three motions for new trial. Xymogen argues that the New Trial Motions are brought under the same rules and the issues substantially overlap, so Thorne should have filed one motion and either adhered to the page-limitation rule or sought leave to file an overlength motion.

         Thorne argues, however, that the New Trial Motions were filed separately “in order to maintain conceptual clarity” as “[e]ach motion presents conceptually distinct legal and factual matters, and provides a separate and independent basis for a new trial.”[4] “Furthermore, nothing in the Federal Rules of Civil Procedure or this Court's Local Rules limits motions brought under Rule 59 to a single motion, or provides a basis to strike plaintiff's motions.”[5]

         First, there is no rule that states that a party may not file multiple motions for new trial under Rule 59. Second, while there is overlap between the motions, each one deals with a distinct issue for which a new trial may be granted. Finally, granting Xymogen's Motion would result in Thorne's inability to condense and re-file the New Trial Motions because a motion for a new trial “‘must be filed no later than 28 days after the entry of judgment, ' and a district court is not permitted to extend this deadline.”[6] Therefore, in the absence of a rule disallowing multiple Rule 59 motions, and in the interest of justice, the Court denies Xymogen's Motion to Strike

         B. The New Trial Motions

         Under Federal Rule of Civil Procedure 59(a)(1)(A), “[t]he court may, on motion, grant a new trial on all or some of the issues . . . after a jury trial, for any reason for which a new trial has heretofore been granted in an action at law in federal court.” “The decision to grant a motion for new trial is committed to the trial court's sound discretion.”[7] “[A] new trial may be granted if the district court concludes the ‘claimed error substantially and adversely' affected the party's rights.”[8]

         “Although a trial judge has broad discretion to order a new trial, the court should also ‘respect the collective wisdom of the jury' and ‘in most cases the judge should accept the finding of the jury, regardless of his own doubts in the matter.'”[9] “After giving the jury's findings full respect, the judge should grant a new trial only if ‘the judge on the entire evidence is left with the definite and firm conviction that a mistake has been committed.'”[10]

         1. The Court's Daubert Ruling and Curative Instruction

         The Court construed “non-crystalline” as “no CoQ10 crystals visible by light microscope at magnifications of 640X.”[11] Two years later, and less than two months before trial, Thorne argued for the first time that the term “light microscope” referred only to the use of a method of light microscopy known as bright field illumination. Thorne made this argument in an effort to exclude the portions of Dr. Prestwich's testimony in which he testified that his use of polarized light revealed crystals in the accused products.

         After a full review of the claim-construction briefing and the ‘888 patent, the Court found “no statements, definitions, or arguments limiting the use of a light microscope to one specific technique or type of light microscopy, ” and, therefore, concluded “that claim construction is not limited to one type of light microscopy and the use of both bright field illumination and polarized light microscopy comply with claim construction.”[12] “If Thorne wanted the Court to construe ‘Non-Crystalline' as limited to bright field illumination, it should have argued for the limitation before the Court's ruling on claim construction.”[13] Instead, Thorne argued that “Non-Crystalline” should be construed as, “lacking crystals visible by light microscope at magnifications of 640x, ”[14] a construction nearly identical to the one adopted by the Court. The Court also warned the parties against arguing or eliciting testimony on claim construction at trial and stated that it would “be the jury's role to decide how much weight to afford the use of the different techniques.”[15]

         Despite this warning, Dr. Brothers testified that he understood polarized light microscopy to be outside of the Court's claim construction. Due to the misleading nature of this testimony, the Court gave the following curative instruction:

You heard testimony from Dr. Brothers implying that the use of polarized light microscopy . . . is outside of the scope of the court's claim construction of the term non-crystalline. The court's construction of non-crystalline does not limit the use of a light microscope to one technique of light microscopy. The use of both bright field illumination and polarized light microscopy comply with claim construction.[16]

         Thorne now seeks a new trial on the issue of infringement, arguing that “multiple errors were made regarding the Court's construction of the term ‘non-crystalline, ' including with respect to rulings on the Daubert motions and a ‘curative' instruction during trial which confused the jury and further prejudiced Plaintiffs.”[17]

a. The Daubert Order

         Thorne argues that the Court's Order on the parties' motions to exclude parts of Dr. Brother's and Dr. Prestwich's expert testimonies (the “Daubert Order”), [18] was incorrect because it “improperly expanded the scope of the claim construction to include a modality-polarizing filters-for which there was no intrinsic evidence, and which was contrary to the method employed by one of skill in the relevant art, ” and “it placed the jury in the position of determining which modality complied with the claim construction.”[19]

         Thorne also argues that “the Court's holding in that regard was based upon Xymogen's incorrect argument to the Court that the standard to be applied in determining whether one ‘skilled in the art' would have used polarizing filters is one skilled ‘in the art of light microscopy.'”[20] According to Thorne, “the correct standard to be applied was whether one skilled in the art of manufacturing CoQ10 supplements would have used such a filter, ”[21] and “[t]he evidence of record demonstrated only that those of skill in the art of manufacturing CoQ10 supplements-Thomas Rumolo (via William Judy) and Don Steele-used light microscopes with no polarizing filter.”[22]

         Xymogen argues that Thorne is merely rehashing its arguments from the Daubert Order briefing despite the Court's rejection of those arguments. “The Court's claim construction ruling and subsequent clarifying order are supported by the intrinsic evidence, and should not be disturbed merely because Thorne regrets failing to have argued for a different construction during the claim construction process.”[23]

         The Court rejects Thorne's arguments. First, the scope of claim construction was not expanded by the Daubert Order. As with any category that contains sub-categories, the scope of light microscopy was not expanded by the Court's finding that two methods, or “sub-categories, ” of light microscopy fit within the definition. The scope of claim construction would only be expanded if the original construction specifically limited light microscopy to one method and then the Court allowed for a second method to be used. That is not the case here. Thorne failed to mention any method of light microscopy until their attempt to exclude Dr. Prestwich's testimony two months before trial, so no limitation was ever placed on “light microscopy.” Second, Thorne misunderstands the Daubert Order if it thinks that the Court based its findings on the argument that a person having ordinary skill in the art (“PHOSITA”) of light microscopy is the standard by which to determine whether a polarizing filter fell within claim construction. As the Court plainly stated, “[c]laim terms are generally given their ordinary and accustomed meaning as understood by one of ordinary skill in the art, ”[24] and in construing “non- crystalline, ” the Court considered how a PHOSITA of manufacturing CoQ10 supplements would understand the term. However, in addressing the admissibility of expert testimony, as was required in Thorne's attempt to exclude Dr. Prestwich's testimony, the standard is based on Federal Rule of Evidence 702. The Court was not revisiting claim construction two months before trial in its Daubert Order, but was considering whether the two methods were valid techniques of light microscopy and whether Dr. Prestwich and Dr. Brothers were qualified to testify as experts in those techniques.

         Further, Thorne provided no evidence that a PHOSITA of manufacturing CoQ10 supplements would only use bright field illumination, thereby warranting exclusion of Dr. Prestwich's testimony and a re-visiting of the Court's construal of “non-crystalline.” Thorne alleged that the inventor of the patented products only used bright field illumination, but provided no further evidence supporting this, and there is no special definition clearly stated in the patent specification or file history that a polarized filter cannot or should not be used.[25]

         Despite these findings, Thorne argues that the Daubert Order and curative instruction were made in error because Donald Steele and Thomas Rumolo, both PHOSITAs of manufacturing CoQ10 supplements, testified in favor of Thorne's construction at trial. According to Thorne, “Mr. Steele confirmed that, when creating the formulations that resulted in the ‘888 patent, he looked through a microscope to determine whether crystals were present.”[26]“Thomas Rumolo, similarly testified that, after he formulated his CoQ10 composition, he sent the formula to William Judy who ‘looked under the microscope' to determine if CoQ10 crystals were present.”[27]

         These statements from Mr. Rumolo and Mr. Steele, however, say nothing of the method of light microscopy used. They state that a microscope was used, but no further detail was elicited from them. Regardless, even if they specified the type of light microscopy used, they did not state that polarized light microscopy could not be used. And while that testimony may not have been appropriate in front of the jury, as it would be arguing claim construction, both parties had access to these witnesses long before trial.

         Further, evidence that a PHOSITA in manufacturing CoQ10 supplements would understand light microscopy as being limited to bright field illumination was not, and has not been provided to the Court. On the contrary, one of Thorne's earlier experts, Kent Rader, submitted an expert report on behalf of Eurofins Scientific Inc., Supplement Analysis Center in which Eurofins analyzed the accused products using a “light microscope with a polarizing filter.”[28] Finally, Dr. Prestwich stated that he has experience working with “biomaterials, pharmaceuticals, agrochemicals, cosmetics, and nutritional supplements companies, ” and not only understands “the term ‘light microscope' to include a microscope that utilizes any form of visible light as the source of illumination, ” but used a polarizing filter in his examination of the accused products.[29]

         For these reasons, the Court finds that the Daubert Order was correct in stating that bright field illumination and polarized light microscopy are both methods of light microscopy that comply with claim construction.

         b. Indefiniteness

         Thorne argues for the first time that the Court's construction of “non-crystalline” “would allow virtually any microscopic technique to be used, ” and is thus invalid due to its indefiniteness.[30]

         “[A] patent is invalid for indefiniteness if its claims, read in light of the specification delineating the patent, and the prosecution history, fail to inform, with reasonable certainty, those skilled in the art about the scope of the invention.”[31] “The definiteness requirement . . . mandates clarity, while recognizing that absolute precision is unattainable.”[32]

         Thorne argues that, with no limit to the methods of light microscopy that may be used under claim construction, “there would be no certainty whatsoever, and a potential infringer presumably must exhaust all of those techniques to determine whether it was infringing or not, as would a patentee.”[33]

         While the Court did not limit light microscopy to a specific method, the claim construction is not indefinite. First, Thorne has not provided evidence that a PHOSITA in the manufacturing of CoQ10 supplements could not determine whether a product was within the scope of the claims.

         Second, a PHOSITA in the manufacturing of CoQ10 supplements knows that the product must not contain CoQ10 crystals that are visible under a light microscope at 640X magnification. This PHOSITA, therefore, knows exactly what type of crystal he is looking for, the magnification to consider, and the type of microscope to use. This PHOSITA would also know the specific characteristics and qualities of CoQ10 crystals, including the color, whether the crystals are birefringent, and what the crystals look like under a microscope. He would, therefore, know the different methods of light microscopy that would be best for determining whether CoQ10 crystals are visible at the specified magnification, and it would be unnecessary for him to go through every single method of light microscopy in his search.

         Finally, Thorne argues that “[t]here is no reason Plaintiffs should have been tasked with excluding every possible light microscopy technique during claim construction, nor should they have been expected to foresee what technique Xymogen may have employed to avoid a finding of infringement.”[34]

         No party should be tasked with excluding everything that a definition at claim construction may cover. However, if a PHOSITA of manufacturing CoQ10 supplements would understand “light microscopy” as referring to only one method, then it was Thorne's duty to make the argument for that limitation during claim construction. Thorne did not. Instead, Thorne argued that the Court should construe non-crystalline as “lacking crystals visible by light microscope at magnifications of 640X, ” a definition that was less specific than the patent specification and was too ambiguous as it did not specify the type of crystals which must be lacking in the product. For these reasons, the Court finds that the original claim construction is not invalid due to indefiniteness.

         c. The Curative Instruction

         The Tenth Circuit has produced conflicting precedent regarding the standard for granting a new trial due to an erroneous instruction.[35] In some cases, the Tenth Circuit has “require[d] reversal when a jury might have based its decision on an erroneous instruction, even if that possibility was very unlikely.”[36] However, an earlier case held that a new trial should be granted “when it is more likely than not that the erroneous instruction affected a substantial right of the appellant.”[37] The Court finds that a new trial is not warranted under either standard.

         Thorne argues that the errors in the Daubert Order were “compounded when Xymogen sought to elicit testimony from Dr. Brothers regarding the use of polarized light, ” and the Court gave a curative instruction which “made it very clear that the scope of the construction had changed, prejudicing Plaintiffs and creating juror confusion.”[38]

         As previously stated, the scope of claim construction was not changed by the Daubert Order. The curative statement was only necessary because Thorne's expert, Dr. Brothers, did exactly what Thorne sought to keep Dr. Prestwich from doing when Dr. Brothers made misleading statements regarding the scope of claim construction. With the clarification that both methods of light microscopy fit within claim construction, the jury was able to properly weigh the strengths and weaknesses of the two methods presented by the parties as they sought to determine “whether further testing with the use of polarized light would have made Dr. Brothers' tests more reliable.”[39] Therefore, the Court finds that the instruction was not erroneous. Instead, it was necessary in order to cure any confusion caused by Thorne's witness.

         For these reasons, the Court finds that a new trial is not warranted as a result of the Daubert Order or the issuance of the curative instruction. Therefore, the Court denies this Motion.

         2. Insufficiency of the Evidence

         Thorne's second motion for new trial asserts that the evidence presented at trial was insufficient for the jury to find invalidity due to derivation under 35 U.S.C. § 102(f) because Xymogen failed “to prove by clear and convincing evidence that Thomas Rumolo conceived of every element of Claims 1 and 5 of the ‘888 patent as construed by the Court.”[40] Xymogen argues that “even if the Court were to accept Thorne's argument regarding the jury's finding of derivation, a new trial would not be warranted because the patent remains invalid under the jury's finding of improper inventorship.”[41] However, the procedure following a finding of improper inventorship is different, as Thorne would be given an opportunity to correct the inventorship. Therefore, the Court will consider whether there was sufficient evidence for the jury to find invalidity due to derivation.

         “A ‘motion for a new trial on the ground that the verdict of the jury is against the weight of the evidence is normally one of fact and not of law and is addressed to the discretion of the trial court.”[42] The moving party “bear[s] the heavy burden of demonstrating that the verdict was clearly, decidedly, or overwhelmingly against the weight of the evidence.”[43] But absent a result “so excessive or inadequate as to shock the judicial conscience and to raise an irresistible inference that passion, prejudice, corruption or other improper cause invaded the trial, the jury's determination of the fact is considered inviolate.”[44]

         Invalidity based on the “claim that a patentee derived an invention addresses originality . . . [and] asserts that the patentee did not ‘invent' the subject matter of the count because the patentee derived the invention from another.”[45] “To show derivation, the party asserting invalidity must prove both prior conception of the invention by another and communication of that conception to the patentee.”[46] The Court will address conception first.

         “Conception is the formation ‘in the mind of the inventor of a definite and permanent idea of the complete and operative invention, as it is therefore to be applied in practice.'”[47] It “must encompass all limitations of the claimed invention, and ‘is complete only when the idea is so clearly defined in the inventor's mind that only ordinary skill would be necessary to reduce the invention to practice, without extensive research or experimentation.'”[48] “Actual reduction to practice requires that the claimed invention work for its intended purposes, and . . . constructive reduction to practice occurs when a patent application on the claimed invention is filed.”[49]

         Thorne argues that “[t]here is no record evidence from which a rational juror could have concluded that Mr. Rumolo conceived of: (1) a non-crystalline CoQ10 composition, meaning no CoQ10 crystals visible by light microscope at magnifications of 640x; and (2) a carrier oil.”[50]According to Thorne, Xymogen represented that the accused products had crystals, and “Mr. Rumolo testified on direct examination that he created a formula that was stable, crystal free and highly absorbable, ” but “did not testify, that his formula . . . lacked CoQ10 crystals under a light microscope at 640x.”[51] Thorne also quotes Dr. Prestwich's testimony in which he testified that samples from Mr. Rumolo's first production lot contained crystals. Finally, Thorne quotes the following exchange between Thorne's counsel and Mr. Rumolo: “And so you don't contend that you created a formula where there are no crystals visible by light microscope at magnification of 640, do you? A: No.”[52]

         Xymogen argues that “Thorne incorrectly suggests that because Mr. Rumolo [reduced to practice one embodiment] of his invention that showed crystals under a light microscope, he could not have [conceived] of a ‘Non-Crystalline' CoQ10 formulation.”[53] “Mr. Rumolo testified that when he reduced to practice one embodiment of his invention-by mixing the physical formula that he recorded as T-7-53D-and allowed Dr. Judy to examine it by light microscope, this examination revealed some crystals. But this does not mean that Mr. Rumolo did not conceive of a “Non-Crystalline” formulation, as that term has been construed by the Court.”[54]

         The Court finds that there was evidence presented at trial from which the jury could find that Mr. Rumolo conceived of the patented formula. First, Dr. Judy's original examination of the product that came from Mr. Rumolo's formula was conducted prior to claim construction, so the statement that the examination revealed crystals was made without the limitations that the patent or claim construction set on the term “non-crystalline.”

Second, the jury was provided with the following testimony from Mr. Rumolo:
Q. Did you eventually create a CoQ10 formula that was stable, crystal [free] and highly absorbable?
A. I did.
A. Our CoQ10 and NVC's formula was roughly 7 percent of the total weight of the dosage. That lies between 5.3 and 12 percent meeting their requirement. Yes, indeed, we do have a solvent, which is Clarinol A80 and Capmul. The Clarinol Alpha-80 is conjugated linoleic acid or CLA that's listed in Claim 1. And we do have avocado oil in there. I'd rather call it an absorption facilitator, but I can understand what they're trying to convey there as a carrier oil. So, yes, it is.
Q. Okay. . . . Now here we put up Claim 5, which is what we call a dependent claim follows on Claim 1. Did you invent in your formula T-7-53-D the conjugated linoleic acid?
A. Yes.
Q. And what is that in your formula?
A. Clarinol Alpha-80.[55]

According to the evidence presented at trial, Dr. Judy and Mr. Steele then took this formula and reduced it to practice.

         Finally, while Mr. Rumolo's testimony alone is not enough to prove conception, [56] there was sufficient corroborating evidence presented at trial, including: (1) Mr. Rumolo's laboratory notebook with the “winner” formula in it; (2) correspondence from Mr. Rumolo to Dr. Judy and to National Vitamin Company employees detailing the ingredients and amounts in Mr. Rumolo's formula (evidence that also goes to the communication prong of derivation); (3) the results of a blood study report in which Dr. Judy analyzed the results of absorption studies performed using Mr. Rumolo's formulas; and (4) correspondence between Mr. Rumolo and management at National Vitamin Company regarding the filing of their own patent. From this evidence, a jury could find that Mr. Rumolo conceived of the formula that was used to create the “non-crystalline” product patented by Dr. Judy and Mr. Steele.

         The evidence presented at trial also supports the argument that the formula contained avocado oil that functioned as a “carrier oil.” There was disagreement regarding the scientifically correct description of how avocado oil functions in the intestines, but Thorne itself elicited testimony from Mr. Rumolo that what he called an “absorption facilitator” was the equivalent of a “carrier oil.”[57] There was also testimony from Thorne's expert, Dr. Abato, stating that avocado oil acts as a carrier oil.

However, Thorne argues that Xymogen cannot
rely upon the testimony from Plaintiffs' expert, Dr. Abato. If that were the case, then the jury's verdict is inherently insupportable because the testimony adduced by Plaintiffs indicated that the Accused Products were both non-crystalline and contained a carrier oil, and the jury could not simultaneously accept that testimony and find that those Accused Products, which were the same as the Rumolo formulation, were non-infringing.[58]

This argument, while best addressed in conjunction with Thorne's third new trial motion, ignores the fact that the jury could have relied on some of Dr. Abato's testimony, that avocado oil acted as a “carrier oil, ” but not other testimony.

         Therefore, the Court finds that that there was sufficient evidence presented at trial for the jury to find that Mr. Rumolo conceived of the original formula Dr. Judy and Mr. ...


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