Medinol Ltd. v. Cordis Corporation ( 2020 )

Case: 19-1826 Document: 41 Page: 1 Filed: 06/12/2020
NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
MEDINOL LTD.,
Plaintiff-Appellant
v.
CORDIS CORPORATION, JOHNSON & JOHNSON,
Defendants-Appellees
______________________
2019-1826
______________________
Appeal from the United States District Court for the
Southern District of New York in No. 1:13-cv-01408-ALC,
Judge Andrew L. Carter.
______________________
Decided: June 12, 2020
______________________
ELIZABETH GARDNER, Robins Kaplan LLP, New York,
NY, for plaintiff-appellant. Also represented by DANIELLE
ROSENTHAL; RICHARD PILDES, NYU School of Law, New
York, NY.
GREGORY DISKANT, Patterson Belknap Webb & Tyler
LLP, New York, NY, for defendants-appellees. Also repre-
sented by EUGENE M. GELERNTER.
______________________
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2 MEDINOL LTD. v. CORDIS CORPORATION
Before DYK, CLEVENGER, and HUGHES, Circuit Judges.
HUGHES, Circuit Judge.
This appeal challenges the denial of Medinol Ltd.’s re-
quest to reopen a 2014 adverse final judgment under Fed-
eral Rule of Civil Procedure 60(b)(6). Because the district
court did not abuse its discretion in denying such relief, we
affirm.
I
The parties are familiar with the long procedural his-
tory leading to this appeal. We described the bulk of it in
our last decision in this litigation, Medinol Ltd. v. Cordis
Corp., 719 F. App’x 1016 (Fed. Cir. 2018) (Medinol II).
There, on remand from the Supreme Court, we revisited
the district court’s first denial of Rule 60(b)(6) relief from a
2014 final judgment dismissing Medinol’s patent infringe-
ment claims as barred by the equitable defense of laches.
See Medinol Ltd. v. Cordis Corp., 137 S. Ct. 1372 (2017)
(summary opinion granting certiorari, vacating, and re-
manding); Medinol Ltd. v. Cordis Corp., 15 F. Supp. 3d 389(S.D.N.Y. 2014) (Laches Opinion). The Supreme Court re-
manded the case to us for further consideration in light of
its decision in SCA Hygiene. 1 In SCA Hygiene, the Court
held that laches is no longer a valid defense to bar damages
for patent infringement, 137 S. Ct. at 967, overruling
Aukerman, our longstanding precedent on which the dis-
trict court relied both in dismissing Medinol’s case and in
denying Medinol’s subsequent Rule 60(b)(6) motion.
After hearing oral argument, we in turn remanded the
case to the district court, vacating the denial of Rule 60(b)
1 SCA Hygiene Prods. Aktiebolag v. First Quality
Baby Prods., LLC, 137 S. Ct. 954 (2017), overruling A.C.
Aukerman Co. v. R.L. Chaides Constr. Co., 960 F.2d 1020(Fed. Cir. 1992) (en banc).
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MEDINOL LTD. v. CORDIS CORPORATION 3
relief, which rested solely on our Aukerman precedent. Me-
dinol II, 719 F. App’x at 1017; see J.A. 1166. We instructed
the district court on remand to “determine whether the ‘ex-
traordinary circumstances’ showing required under
Rule 60(b)(6) has been established,” and we specified that
as part of that analysis, the district court “should consider
Medinol’s failure to appeal” the original final judgment, un-
der the Supreme Court’s decision in Gonzalez v. Crosby,
545 U.S. 524, 536–38 (2005). Medinol II, 719 F. App’x
at 1017.
Back before the district court, 2 Medinol filed a renewed
Rule 60(b)(6) motion seeking to set aside the laches dismis-
sal judgment. Medinol argued that the Supreme Court’s
decisions rendered post-judgment in SCA Hygiene and Pet-
rella v. Metro-Goldwyn-Mayer, Inc., 572 U.S. 663, 667
(2014) (holding that laches is not a defense to damages for
copyright infringement), constituted “extraordinary cir-
cumstances” warranting such relief. J.A. 1607. Medinol
further argued that its failure to appeal from the original
judgment of dismissal should not preclude Rule 60(b) relief
because it reasonably believed at the time that any appeal
would be “futile” under existing Federal Circuit precedent.
J.A. 1626–27.
After receiving full briefing, the district court denied
the motion, finding that Medinol failed to show the requi-
site extraordinary circumstances. Medinol Ltd. v. Cordis
Corp., No. 13-CV-1408, 2019 WL 1428342 (S.D.N.Y.
Mar. 29, 2019) (District Court Decision). The district court
rejected Medinol’s argument that “the nature and magni-
tude of the change in law, the centrality of the changed law
to the case, and the extreme and undue prejudice [Medinol]
2 Following remand, the case was reassigned to Dis-
trict Judge Carter due to the retirement of District Judge
Scheindlin, who previously had presided over the district
court litigation.
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4 MEDINOL LTD. v. CORDIS CORPORATION
would suffer” justified relief from the judgment. Id. at *3.
Instead, analogizing to the circumstances in Gonzalez v.
Crosby, the district court found that Medinol exhibited a
lack of diligence in pursuing a direct appeal because, de-
spite understanding the potential significance of the Su-
preme Court’s imminent Petrella decision (regarding the
availability of laches as a defense to copyright infringe-
ment), Medinol voluntarily chose not to appeal. District
Court Decision at *3. Further, the district court concluded
that any undue prejudice or injustice Medinol might suffer
from leaving the judgment in place was not extraordinary
because (1) Medinol had not been denied the opportunity
to try its claims, but—as found in the original dismissal or-
der, see Laches Opinion, 15 F. Supp. 3d at 409—had de-
layed bringing its infringement action at numerous points
over 14 years, and then actively decided not to appeal the
laches dismissal; and (2) any prejudice Medinol might ex-
perience did not rise to the level faced by movants in prior
cases where relief had been granted. District Court Deci-
sion at *3. At root, the district court found this case pre-
sented “a change in decisional law, and nothing more”; the
court therefore denied Rule 60(b)(6) relief. Id. at *4.
Medinol appeals. We have jurisdiction under 28 U.S.C.
§ 1295(a)(1).
II
“When reviewing a ruling under Rule 60(b), we gener-
ally defer to the law of the regional circuit in which the dis-
trict court sits, here the Second Circuit, because that rule
is procedural in nature and not unique to patent law.” Laz-
are Kaplan Int’l, Inc. v. Photoscribe Techs., Inc.,
714 F.3d 1289, 1292 (Fed. Cir. 2013) (footnote omitted).
The Second Circuit reviews a district court’s decision on a
Rule 60(b) motion for abuse of discretion, which occurs
when “(1) its decision rests on an error of law or a clearly
erroneous factual finding; or (2) cannot be found within the
range of permissible decisions.” In re Terrorist Attacks on
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MEDINOL LTD. v. CORDIS CORPORATION 5
Sept. 11, 2001, 741 F.3d 353, 357 (2d Cir. 2013) (quotation
omitted).
Rule 60(b)(6) allows a district court to “relieve a
party . . . from a final judgment, order, or proceeding” for
“any . . . reason that justifies relief.” Fed. R. Civ.
P. 60(b)(6). “It is a grand reservoir of equitable power to do
justice in a particular case. But that reservoir is not bot-
tomless. Recognizing Rule 60(b)(6)’s potentially sweeping
reach, courts require the party seeking to avail itself of the
Rule to demonstrate that ‘extraordinary circumstances’
warrant relief.” In re Terrorist Attacks, 741 F.3d at 356
(quoting Stevens v. Miller, 676 F.3d 62, 67 (2d Cir. 2012));
see Buck v. Davis, 137 S. Ct. 759, 777–78 (2017) (citing Gon-
zalez, 545 U.S. at 535) (requiring a Rule 60(b)(6) movant to
show “extraordinary circumstances” justifying reopening a
final judgment). Relief is warranted under Rule 60(b)(6)
“where the judgment may work an extreme and undue
hardship, and [the Rule] should be liberally construed
when substantial justice will thus be served.” United Air-
lines, Inc. v. Brien, 588 F.3d 158, 176 (2d Cir. 2009) (quot-
ing Matarese v. LeFevre, 801 F.2d 98, 106 (2d Cir. 1986)).
But under no circumstances may a party “use a Rule 60(b)
motion as a substitute for an appeal it failed to take in a
timely fashion.” Stevens, 676 F.3d at 67.
In this appeal, Medinol argues—as it did before the dis-
trict court—that extraordinary circumstances are present
because of the nature and magnitude of the Petrella / SCA
Hygiene change of law regarding the availability of a laches
defense, and because it would work an undue hardship and
injustice for Medinol to be denied the opportunity to have
its patent infringement claims tried on the merits based on
the initial “ultra vires” district court judgment of dismissal.
Medinol argues that the district court abused its discretion
by concluding otherwise, and legally erred by (1) failing to
consider the import of the change of law, (2) “penalizing”
Medinol for not taking an initial appeal when any appeal
would have been “obviously futile,” and (3) violating SCA
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6 MEDINOL LTD. v. CORDIS CORPORATION
Hygiene by relying on the original laches finding that Me-
dinol delayed bringing suit.
We see no abuse of discretion or legal error here. We
can easily dispose of Medinol’s first and last ascriptions of
legal error. First, we find no support for Medinol’s conten-
tion that the district court failed to consider the “signifi-
cance, magnitude, or nature” of the Petrella / SCA Hygiene
change of law. Appellant’s Br. 20. There is no doubt that
the Supreme Court’s decisions in these cases dramatically
changed the legal landscape for statutory infringement ac-
tions. The parties fully briefed the district court on this
change of law, and the court specifically acknowledged Me-
dinol’s position on the cases’ enormity and significance for
the dismissed claims. District Court Decision at *3. But
the district court found those factors outweighed by Medi-
nol’s decision not to appeal and the absence of extraordi-
nary prejudice or undue hardship. Id. And Medinol has
identified no Second Circuit law requiring district courts to
expressly weigh the significance and nature of a change of
law when conducting Rule 60(b)(6) analyses.
Nor did the district court violate SCA Hygiene by fac-
toring the timing of Medinol’s suit into its undue hardship
analysis. As the district court recognized, under SCA Hy-
giene, “[l]aches cannot be interposed as a defense against
damages where the infringement occurred within the pe-
riod prescribed by [the Patent Act, 35 U.S.C.] § 286.” Dis-
trict Court Decision at *2 (quoting SCA Hygiene, 137 S. Ct.
at 967) (alterations in original). The district court found
that Medinol had not shown undue hardship or prejudice
from having been denied the opportunity to try its claims,
in part because Medinol delayed bringing its infringement
action. District Court Decision at *3 (citing Laches Opin-
ion, 15 F. Supp. 3d at 409). By relying on this unappealed
factual finding of delay the district court was not resurrect-
ing the laches defense in contravention of SCA Hygiene. Cf.
Petrella, 572 U.S. at 686–87 (concluding that it was error
to treat laches as a complete bar to plaintiff’s copyright
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MEDINOL LTD. v. CORDIS CORPORATION 7
infringement suit, but stating that if plaintiff ultimately
prevailed on the merits, the district court “may take ac-
count of her delay in commencing suit” when determining
appropriate injunctive relief and assessing profits). The
district court permissibly rejected Medinol’s argument that
Medinol had been prejudiced by circumstances completely
beyond its own control.
As its primary assertion of legal error, Medinol urges
us to set aside the denial of Rule 60(b) relief because the
district court impermissibly penalized Medinol for not tak-
ing a direct appeal that Medinol characterizes as having
been “futile” during the time period for seeking appellate
review. We decline to do so.
Appellees do not argue that a per se bar precludes
Rule 60(b)(6) relief where the movant did not timely appeal
the judgment sought to be vacated. And the district court
did not treat Medinol’s failure to appeal the laches judg-
ment as a per se bar to the Rule 60(b)(6) relief sought here.
Rather, in accordance with our remand instruction, see Me-
dinol II, 719 F. App’x at 1017, the district court weighed
Medinol’s decision not to appeal along with the other as-
serted factors in reaching its conclusion that extraordinary
circumstances were not present. District Court Decision
at *3 (identifying a plaintiff’s “‘lack of diligence in pursuing
review’ [as] a factor mitigating the extraordinary nature of
a case” (quoting Gonzalez, 545 U.S. at 537)).
In Gonzalez, the Supreme Court affirmed the denial of
Rule 60(b)(6) relief to a pro se prisoner seeking a certificate
of appealability (COA) to challenge the dismissal of his pur-
portedly untimely habeas corpus petition based on a post-
judgment change of law regarding the interpretation of the
federal habeas statute of limitations. 545 U.S. at 536–38.
The Court held that the post-judgment change of law was
not an extraordinary circumstance because Mr. Gonzalez
displayed a “lack of diligence in pursuing review of the stat-
ute-of-limitations issue” by failing to request rehearing
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8 MEDINOL LTD. v. CORDIS CORPORATION
of—or seek certiorari for—the Eleventh Circuit’s denial of
his COA, despite there being an active circuit conflict over
the issue. Id. at 537 & n.10. The Court analogized to
Ackermann v. United States, 340 U.S. 193, 195 (1950),
where the Court also “affirmed the denial of Rule 60(b) re-
lief, noting that the movant’s decision not to appeal had
been free and voluntary,” although “it appear[ed] mistaken
in hindsight.” Id. at 537–38.
Medinol contends that Gonzalez “has no bearing on the
issues here” because unlike Mr. Gonzalez, Medinol had “le-
gitimate, appropriate, and completely sensible reasons for
not pursuing what would have been an obviously futile ap-
peal.” Appellant’s Br. 26. Medinol stresses that, during
the time period for taking an appeal, it had no reason to
suspect that our long-standing en banc decision endorsing
laches as a defense to patent infringement, Aukerman, 960
F.2d at 1029–32, might soon be overturned. Thus, Medinol
says, it was error to construe its decision not to appeal as a
lack of diligence.
Initially, we question the wisdom of dismissing as in-
significant a case we expressly identified in Medinol II as
relevant to the “extraordinary circumstances” analysis.
And although there may have been fewer indicators moti-
vating Medinol to appeal its laches judgment here than
were present in Gonzalez, the district court did not err by
counting Medinol’s failure to appeal against it.
As the district court noted, even before the 2014 laches
judgment was rendered, Medinol recognized the potential
significance of the Petrella laches-copyright infringement
case that was being argued at the Supreme Court during
the district court’s laches-patent infringement bench trial.
Before that trial, Medinol alerted the court—in a footnote
following a citation to Aukerman—that the anticipated Pet-
rella decision “may have broad implications for the applica-
bility of laches to other continuing torts, including patent
infringement,” and it therefore reserved the right to argue
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MEDINOL LTD. v. CORDIS CORPORATION 9
that laches could not be applied to bar a legal claim for pa-
tent infringement damages. J.A. 195 & n.1 (Medinol’s Pre-
Trial Memorandum of Law). Medinol ultimately never as-
serted that argument at trial, nor did it appeal from the
final laches judgment. But throughout the window for di-
rect appeal, Medinol remained aware—as it had been pre-
judgment—that Petrella might undercut the foundation of
the district court’s judgment. That Medinol freely and vol-
untarily made the decision not to appeal, despite this
awareness, can properly be viewed as a lack of diligence
mitigating the claimed extraordinary nature of the case.
See Ackermann, 340 U.S. at 198 (“There must be an end to
litigation someday, and free, calculated, deliberate choices
are not to be relieved from.”); Lazare Kaplan,
714 F.3d at 1296 (noting that where Rule 60(b)(6) movants
have “made a deliberate choice not to appeal or to pursue a
particular litigation strategy, courts have found relief un-
warranted,” and collecting Second Circuit cases); Cruick-
shank & Co. v. Dutchess Shipping Co., 805 F.2d 465, 468
(2d Cir. 1986) (“Failure to properly assess the risks and po-
tential gains of taking an appeal is not an extraordinary
circumstance that would justify relief under
[R]ule 60(b)(6).”).
Medinol’s protestations of futility ring somewhat hol-
low against the hindsight knowledge that, if it had directly
appealed the laches judgment, the Supreme Court in all
likelihood would have taken the opportunity to overrule
Aukerman—as it ultimately did when SCA Hygiene ap-
pealed its similar laches judgment—thereby providing Me-
dinol the relief it has been seeking instead via Rule 60(b)(6)
for the past six years. Cf. Stevens, 676 F.3d at 67 (prohib-
iting Rule 60(b) motions as a substitute for direct appeal).
Of course, we do not expect parties to foresee the future
when deciding whether to appeal an adverse judgment. We
simply conclude that there were enough reasons support-
ing an appeal in this case for the district court to properly
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10 MEDINOL LTD. v. CORDIS CORPORATION
hold Medinol’s failure to appeal against it in the
Rule 60(b)(6) analysis. 3
Finally, the district court did not abuse its discretion in
weighing this failure to appeal alongside the factors Medi-
nol put forth as warranting relief from judgment. First, as
Medinol readily acknowledges, “a change of law, in itself,
does not constitute extraordinary circumstances.” Appel-
lant’s Br. 20. See Tapper v. Hearn, 833 F.3d 166, 172
(2d Cir. 2016) (“[A]s a general matter, a mere change in de-
cisional law does not constitute an ‘extraordinary circum-
stance’ for the purposes of Rule 60(b)(6)[.]” (first alteration
in original) (quoting Marrero Pichardo v. Ashcroft, 374 F.3d
46, 56 (2d Cir. 2004)); In re Terrorist Attacks, 741 F.3d
at 357 (“Whenever the law changes, parties who lost a prior
case because of the now-altered law may feel that justice
was not done. Generally, the interest in finality outweighs
that concern.”); see also Gonzalez, 545 U.S. at 536 (“It is
hardly extraordinary that subsequently, after petitioner’s
case was no longer pending, this Court arrived at a differ-
ent interpretation[ of the statute at issue].”). The district
court acted within its discretion in rejecting Medinol’s at-
tempt to spin the Petrella / SCA Hygiene change of law as
something more. That these decisions overturned our en
banc precedent is hardly unique. And we decline to read
these cases as especially significant because they rest on
separation-of-powers principles. Although it is now clear
that courts cannot entertain the equitable defense of laches
to override congressionally established timeliness limits,
see SCA Hygiene, 137 S. Ct. at 960; Petrella, 572 U.S.
at 667, in April 2014 the district court acted perfectly
within its authority by accepting a laches defense to
3 We also reject as inapposite Medinol’s reliance on
cases holding that a party does not forfeit its ability to chal-
lenge controlling precedent in a direct appeal by not raising
such a challenge in the district court.
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MEDINOL LTD. v. CORDIS CORPORATION 11
Medinol’s claims. That the district court could not permis-
sibly render the same judgment today just reinforces that
Medinol’s Rule 60(b)(6) request relies primarily on a mere
post-judgment change of law.
We also perceive no abuse of discretion in the district
court’s rejection of the remaining factors Medinol asserted.
We will not disturb the district court’s assessment of Medi-
nol’s inability to try its claims on the merits and loss of op-
portunity to recover large sums in damages as presenting
a lesser injustice than in cases involving judicial bias, ra-
cially tinged criminal convictions, or deportation conse-
quences. See District Court Decision at *3.
III
Because the district court did not abuse its discretion
in deciding that Medinol’s Rule 60(b)(6) motion fails to set
forth “extraordinary circumstances” justifying relief, we af-
firm the judgment of the district court.
AFFIRMED