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Greatbatch Ltd. v. AVX Corp.

United States District Court, D. Delaware

March 30, 2018


          Brian E. Farnan, FARNAN LLP, Wilmington, DE James R. Muldoon, HARRIS BEACH PLLC, Syracuse, NY Neal L. Slifkin, Laura W. Smalley, Steven P. Nonkes, HARRIS BEACH PLLC, Pittsford, NY Attorneys for Plaintiff.

          Robert W. Whetzel, Chad M. Shandler, Todd Coomes, Jason J. Rawnsley, RICHARDS, LAYTON & FINGER, PA., Wilmington, DE Ronald E. Cahill, Paul J. Cronin, James C. Hall, Heather B. Repicky, Alison C. Casey, NUTTER, MCCLENNEN & FISH LLP, Boston, MA Tim F. Williams, DORITY & MANNING, Greenville, SC Attorneys for Defendants.



         On April 25, 2013, Greatbatch filed this patent infringement action. To date it has involved (among other things) two jury trials on the validity of four patents - the '095 patent, the '627 patent, the '715 patent, and the '779 patent - and on infringement of those patents by AVX's Frontier, NG3, and Ingenio filtered feedthroughs ("FFTs"), some of which come in multiple versions.[1]

         On October 3, 2017, the Court held a bench trial on AVX's equitable defense of estoppel, by which AVX seeks to bar Greatbatch from recovering damages for infringement of U.S. Patent Nos. 5, 908, 627 and 5, 333, 095. (See D.I. 1090 (hereinafter, "Bench Tr."))

         Pending before the Court is AVX's request that Greatbatch be barred from recovery for infringement of the '627 and '095 patents, or at a minimum, barred from recovery on Greatbatch's price erosion theory due to estoppel. (D.I. 1084).

         Briefing was completed on November 21, 2017 (see D.I. 1084, 1098, 1103), and the Court heard oral argument on January 18, 2018 (see D.I.) ("Tr."). Having carefully considered the record and the parties' arguments, and for the reasons discussed below, the Court will deny AVX's request to bar Greatbatch. Pursuant to Federal Rule of Civil Procedure 52(a), and after having considered the entire record in this case and the applicable law, the Court concludes that AVX has failed to prove its affirmative defense of equitable estoppel.

         The Court's findings of fact and conclusions of law are set forth in detail below.

         FINDINGS OF FACT[2]

         A. The Parties, Patents, and Products

         1. Plaintiff Greatbatch Ltd. ("Greatbatch") has its principal place of business in Clarence, New York. (Frustaci 2016 Tr. at 259)[3]

         2. Defendant AVX Corporation has its principal place of business in Greenville, South Carolina. (Lawing 2016 Tr. at 1276) Defendant AVX Filters Corporation, a subsidiary of AVX Corporation, is located in Sun Valley, California. (See Id. at 1280, 1282, 1292)

         3. United States Patent No. 5, 905, 627 (the '"627 Patent"), entitled "Internally Grounded Feedthrough Filter Capacitor, " was issued by the United States Patent & Trademark Office to named inventors Richard L. Brendel ("Brendel") and Robert A. Stevenson ("Stevenson") on May 18, 1999. (PTX-1)

         4. United States Patent No. 5, 333, 095 (the '"095 Patent"), entitled "Feedthrough Filter Capacitor Assembly for Human Implant, " was issued by the United States Patent & Trademark Office to named inventors Robert A. Stevenson and Donald N. Pruett on July 26, 1994. (PTX-2)

         5. The accused products are filtered feedthroughs ("FFTs") made for Boston Scientific Corporation ("BSC") for the Frontier, Ingenio and NG3 programs. Frontier was a feedthrough for use in a defibrillator. (See Panlener 2016 Tr. at 511) Ingenio was a low-voltage filtered feedthrough for use in a pacemaker. (See Id. at 1412) NG3 was a feedthrough filter capacitor for a defibrillator. (See id.) NG3 had the same style of filtering array as Frontier, but with two more pins. (See Id. at 1409)

         B. The Parties' Prior Correspondence

         6. Prior to the commencement of this litigation on April 25, 2013, for nearly a decade Greatbatch and AVX had engaged in correspondence regarding Greatbatch's assertions of infringement. (See DTX-2008, DTX-2013, DTX-2015, DTX-2052, DTX-2055, DTX-2058, DTX-2060, DTX-2062, DTX-2067, DTX-2068)

         7. On December 5, 1997, Greatbatch's predecessor (Maxwell Technologies, Inc. (hereinafter, "Maxwell")) sent a letter advising AVX that a patent application unrelated to the patents in suit had been allowed by the U.S. Patent and Trademark Office. (DTX-2008; Slavitt Bench Tr. at 16) AVX concedes this was simply a notice letter. (See Slavitt Bench Tr. at 16)

         8. Over three years later, in January 2001, Maxwell sent AVX a letter advising it about: (1) the '627 patent, which covered an internally grounded filter; and (2) U.S. Pat. No. 5, 978, 204 (the '"204 patent"), which is not at issue in this litigation. (See DTX-2013; Slavitt Bench Tr. at 16-17) The letter requested AVX cease manufacture or explain why AVX believed its products did not fall within the scope of the claims. (DTX-2013) On January 17, 2001, AVX's outside counsel, Dority & Manning, advised Maxwell that its January 9 letter had been referred to it for a response. (DTX-2015; Slavitt Bench Tr. at 17)

         9. Upon receipt of the January 2001 letter, AVX reviewed the contentions with respect to a product that AVX was working on at that time for Guidant (a predecessor of BSC) and, after consultation with counsel, determined there was no infringement. (See PTX-4038; Slavitt Bench Tr. at 17, 44-45)

         10. There was no further correspondence between Greatbatch and AVX until 2004.

         11. On August 18, 2004, Greatbatch wrote AVX, noting that it had previously informed AVX regarding infringement concerns relating to the '204 patent and that the patent had undergone reexamination. (DTX-2052) The letter also raised a potential concern regarding an EMI filter AVX sold to St. Jude Medical for its Integrity and Victory product lines, relating to both the "204 patent and U.S. Patent No. 6, 765, 779 (the "779 patent"). (Id.)

         12. Greatbatch's August 18, 2004 letter also provided notice to AVX that it owned various other patents related to FFT assemblies, including the '095 patent and the '627 patent, among others. (DTX-2052) The letter did not accuse any AVX product of infringing those patents, but requested AVX "confirm whether or not [its] activities infringe [the '204 patent's] claims as well as those in [the '779 patent], among the others listed above." (Id.)

         13. On September 16, 2004, AVX responded, explaining that, according to AVX, its products made for St. Jude did not infringe the '204 or the '779 patent, as AVX believed both patents were invalid due to prior sales. (DTX-2055) The letter also informed Greatbatch that AVX had, in 2001, "diligently studied the issues with patent counsel, and determined that there was no infringement of the '627 patent...." (Id.) The letter did not address the '095 patent or allege that the '627 patent was invalid. (Id.)

         14. Greatbatch's responding letter, dated October 18, 2004, discussed the '204 and '779 patents, but did not mention either the '095 or the '627 patent. (See DTX-2058)

         15. The parties' correspondence continued through 2004 and 2005 (see, e.g., DTX- 2060; DTX-2062; DTX-2067; DTX-2068; Slavitt Bench Tr. at 20), but the last letter regarding alleged infringement of the '627 patent was in 2004, over four years before AVX sold a Frontier FFT with an internal ground. (See DTX-2055)

         16. In 2008, the parties exchanged letters regarding U.S. Patent No. 5, 973, 906. (DTX-2092; DTX-2097) These letters did not address infringement or validity of the '095 or '627 patents. (See id.)

         17. In its letter addressing the '906 patent on November 10, 2008, AVX also suggested that there was "an emerging pattern of the assertion of patent rights without a good faith basis to do so . . . [and] such action can constitute an unfair or deceptive trade practice." (DTX-2097; see Scalise Bench Tr. at 147) Greatbatch did not reply to this letter. (See Slavitt 2017 Bench Tr. at 23; Scalise 2017 Bench Tr. at 147)

         C. The Parties and BSC

         18. Greatbatch entered into a Supply Agreement with BSC in 2007. (PTX-82)

         19. In July of 2007, BSC approached AVX regarding work on developing new filter designs, and thereafter, AVX began design and development of the Frontier FFT. (See Panlener 2016 Tr. at 1388-89, 1391-92; DTX-147)

         20. In September 2007, BSC told AVX that AVX would be a second source to Greatbatch ...

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