UPDATED July 9, 2015, with correction of Law360 report, Boston Scientific comments.
A California jury today opened the door to a potential $200 million decision for Boston Scientific (NYSE:BSX) in a long-running royalties dispute with coronary stent pioneer Dr. David Jang, finding that the company infringed a patent and breached its licensing deal with Jang, according to Law360, which originally reported that the jury awarded the full amount to Jang.
The case dates back to 1999, when Jang won approval from the U.S. Patent & Trademark Office for a stent design featuring lateral struts. In 2002, Jang inked a deal worth up to $160 million to license the patents to Boston Scientific; Jang received $50 million up front, according to court documents, but only $10 million of the remaining $110 million in milestone payments.
Jang sued in 2005 in the U.S. District Court for Central California, alleging breach of contract and other claims. Boston Scientific denied the accusations and filed a counterclaim in 2006 “denying any obligation to make additional contingent payments to Jang on the ground that that the accused stents did not infringe,” and thus were not covered under the deal with Jang, according to court documents.
Judge Virginia Anne Phillips ruled that the Boston Scientific stents did not infringe the Jang patents, shooting down the breach of contract claim and deciding the other claims in Boston’s favor. After Jang appealed, the Federal Circuit in 2012 vacated the ruling and remanded it to Phillips.
A Patent Office re-examination in 2013 found the Jang patents invalid, prompting Marlborough, Mass.-based Boston Scientific to argue that it shouldn’t be required to pay royalties on invalid patents. Phillips denied that bid for summary judgment, ruling that Jang has the right to demand royalties covering the time up until Boston Scientific asked for the re-examination, according to court documents. Boston then filed its appeal asking the Federal Circuit to review the Phillips decision; the appeals court in September 2014 declined to hear the petition, setting the stage for the current trial.
Responding to the Law360 report that the jury in that trial today handed down a $200 million verdict in favor of Jang, Boston Scientific told MassDevice.com via email that there was no verdict mentioning any dollar amount.
“Judge Phillips made clear on the record yesterday that no judgment would be entered until the next phase of the trial in August. Further, the judge has set no dollar amount and no figures were discussed. We are pleased the jury found that Boston Scientific did not literally infringe the patent. We feel confident that we will prevail on the doctrine of equivalents claim, which is the only claim left to be resolved,” the company said in a statement.