JOHN M.J. MADEY, Plaintiff-Appellant, v. DUKE UNIVERSITY,
UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT
307 F.3d 1351; 2002 U.S. App. LEXIS 20823; 64 U.S.P.Q.2D (BNA) 1737
October 3, 2002, Decided
GAJARSA, and LINN, Circuit Judges.
GAJARSA, Circuit Judge.
Dr. John M.J. Madey ("Madey") appeals from a judgment of the United
States District Court for the Middle District of North Carolina. Madey
sued Duke University ("Duke"), bringing claims of patent infringement
and various other federal and state law claims. Pursuant to a motion
filed by Duke under Federal Rule of Civil Procedure ("FRCP") 12(b)(1),
the district [**2]
court dismissed-in-part certain patent infringement claims and
dismissed certain other claims. Madey v. Duke Univ., 1999 U.S. Dist.
LEXIS 21379, No. 1:97CV1170, slip op. at 12-14, 38-40 (M.D.N.C. Dec. 1,
1999) ("Dismissal Opinion"). After discovery, the district court
granted summary judgment in favor of Duke on the remaining claims. For
a first set of alleged infringing acts, it held that the experimental
use defense applied to Duke's use of Madey's patented laser technology.
For a second set of alleged infringing acts, it held that Duke was not
the infringing party because a third-party owned and controlled the
allegedly infringing laser equipment. Madey v. Duke Univ., No.
1:97CV1170, slip op. at 12-15, 18, 20 (M.D.N.C. June 15, 2001)
("Summary Judgment Opinion"). The district court erred in its partial
dismissal, erred in applying the experimental use defense, but, for the
second set of alleged infringing acts, correctly determined that Duke
did not infringe because it did not own or control the equipment.
Accordingly, we reverse-in-part, affirm-in-part, and remand.
In the mid-1980s Madey was a tenured research professor at Stanford
University. At Stanford, he had an innovative [**3]
research program, which was highly regarded in the scientific
community. An opportunity arose for Madey to consider leaving Stanford
and take a tenured position at Duke. Duke recruited Madey, and in 1988
he left Stanford for a position in Duke's physics department. In 1989
Madey moved his free electron laser ("FEL") research lab from Stanford
to Duke. The FEL lab contained substantial equipment, requiring Duke to
build an addition to its physics building to house the lab. In
addition, during his time at Stanford, Madey had obtained sole
ownership of two patents practiced by some of the equipment in the FEL
At Duke, Madey served for almost a decade as director of the FEL lab.
During that time the lab continued to achieve success in both research
funding and scientific breakthroughs. However, a dispute arose between
Madey and Duke. Duke contends that, despite his scientific prowess,
Madey ineffectively managed the lab. Madey contends that Duke sought to
use the lab's equipment for research areas outside the allocated scope
of certain government funding, and that when he objected, Duke sought
to remove him as lab director. [*1353]
Duke eventually did remove
Madey as director of the [**4]
lab in 1997. The removal is not at issue in this appeal, however, it is
the genesis of this unique patent infringement case. As a result of the
removal, Madey resigned from Duke in 1998. Duke, however, continued to
operate some of the equipment in the lab. Madey then sued Duke for
patent infringement of his two patents, and brought a variety of other
The Patents and Infringing Equipment
One of Madey's patents, U.S. Patent No. 4,641,103 ("the '103 patent"),
covers a "Microwave Electron Gun" used in connection with free electron
lasers. The other patent, U.S. Patent No. 5,130,994 ("the '994
patent"), is titled "Free-Electron Laser Oscillator For Simultaneous
Narrow Spectral Resolution And Fast Time Resolution Spectroscopy." The
details of these two patents are not material to the issues on appeal.
Their use in the lab, however, as embodied in certain equipment, is
central to this appeal.
The equipment at the Duke FEL lab that practices the subject matter
disclosed and claimed in the patents is set forth in the list below,
which first lists the equipment and then the patent(s) it embodies.
. An infrared FEL called the "Mark III FEL," embodying the
'994 patent and the [**5]
'103 patent (by incorporating the microwave electron gun in the
. A "Storage Ring FEL," embodying the same patents as the Mark III FEL
because it incorporates a Mark III FEL.
. A "Microwave Gun Test Stand," embodying the '103 patent (by
incorporating the microwave electron gun).
The three alleged infringing devices are the Mark III FEL, the Storage
Ring FEL, and the Microwave Gun Test Stand. Although it is not clear
from the record, perhaps because Duke defended by asserting
experimental use and government license defenses, Duke seems to concede
that the alleged infringing devices and methods read on the claims of
the patents. Although the three devices were housed in Duke's physics
facilities, the Microwave Gun Test Stand was not Duke's asset, but
rather belonged to North Carolina Central University ("NCCU").....
The District Court's Summary Judgment Opinion
Among Duke's motions for summary judgment, two are relevant on appeal,
entitled by the district court as: (i) the "Patent Motion;" and (ii)
the "Test Stand Gun Motion."
The Patent Motion and the Experimental Use Defense
The district court acknowledged a common law "exception" for patent
infringement liability for uses that, in the district court's words,
are "solely for research, academic or experimental purposes." Summary
Judgment Opinion at 9 (citing Deuterium Corp. v. United States, 19 Cl.
Ct. 624, 631, 14 U.S.P.Q.2D (BNA) 1636, 1642 (1990); Whittemore v.
Cutter, 1 Gall. 429, 29 F. Cas. 1120 (C.C.D. Mass. 1813) (No. 17,600);
and citing two commentators n2 ). The district court recognized the
debate over the scope of the experimental use defense, but cited this
court's opinion in Embrex, Inc. v. Service Engineering Corp., 216 F.3d
1343, 1349, 55 U.S.P.Q.2D (BNA) 1161, 1163 (Fed. Cir. 2000) to hold
that the defense was viable for experimental, non-profit purposes.
Summary Judgment Opinion at 9 (citing Embrex, 216 F.3d at 1349, 55
U.S.P.Q.2D (BNA) at 1163 (noting that courts should not [**11]
"construe the experimental use rule so broadly as to allow a violation
of the patent laws in the guise of 'scientific inquiry,' when that
inquiry has definite, cognizable, and not insubstantial commercial
purposes" (quoting Roche Prods., Inc. v. Bolar Pharm. Co., 733 F.2d
858, 863, 221 U.S.P.Q. (BNA) 937, 940 (Fed. Cir. 1984)) n3 )).
After having recognized the experimental use defense, the district
court then fashioned the defense for application to Madey in the
passage set forth below.
Given this standard [for experimental use], for [Madey] to overcome his
burden of establishing actionable infringement in this case, he must
establish that [Duke] has not used the equipment at issue "solely for
an experimental or other non-profit purpose." 5 Donald S. Chisum,
Chisum on Patents § 16.03 (2000). More specifically, [Madey] must
sufficiently establish that [Duke's] use of the patent had "definite,
cognizable, and not insubstantial commercial purposes." Roche Prods.,
Inc. v. Bolar Pharm. Co., 733 F.2d 858, 863 (Fed. Cir. 1984), cert.
denied, 469 U.S. 856, 83 L. Ed. 2d 117, 105 S. Ct. 183 (1984).
Summary Judgment Opinion at 10.
On appeal, Madey attacks this passage as improperly shifting the burden
to the plaintiff to allege and prove that the defendant's use was not
Before the district court, Madey argued that Duke's research in its FEL
lab was commercial in character and intent. Id. Madey relied on
Pitcairn v. United States, 212 Ct. Cl. 168, 547 F.2d 1106, 192 U.S.P.Q.
(BNA) 612 (Ct. Cl. [*1356]
where the government used patented rotor structures and control systems
for a helicopter to test the "lifting ability" and other attributes of
the patented technology. Pitcairn, 547 F.2d at 1125-26, 192 U.S.P.Q.
(BNA) at 625. The Pitcairn court held that the helicopters were not
built solely for experimental purposes because they were also built to
benefit the government in its legitimate business. Id. Based on
language in Duke's patent policy, Madey argues that Duke is in the
business of "obtaining grants and developing possible commercial
applications for the fruits of its 'academic research.'" Summary
Judgment Opinion at 11.
The district court rejected Madey's argument, relying on another
statement in the preamble of the Duke patent policy which stated that
Duke was "dedicated to teaching, research, and the expansion of
knowledge . . . [and] does not undertake research or development work
principally for the purpose of developing patents and commercial
applications." Id. The district court reasoned that these statements
from the patent policy refute any contention that Duke is "in the
business" of developing technology for commercial applications. Id.
at 12. According to the district court, Madey's "evidence" was mere
speculation, n4 and thus Madey did not meet his burden of proof to
create a genuine issue of material fact. n5 Id. The court went on to
state that "without more concrete evidence to rebut [Duke's] stated
purpose with respect to its research in the FEL lab, Plaintiff has
failed to meet its burden of establishing patent infringement by a
preponderance of the evidence." Id. at 13....
The District Court's Application of Experimental Use
On appeal, Madey asserts three primary errors related to experimental
use. First, Madey claims that the district court improperly shifted the
burden to Madey to prove that Duke's use was not experimental. Second,
Madey argues that the district court applied an overly broad version of
the very narrow experimental use defense inconsistent with our
precedent. Third, Madey attacks the supporting evidence relied on by
the district court as overly general and not indicative of the specific
propositions and findings required by the experimental use defense, and
further argues that there is no support in the record before us to
allow any court to apply the very narrow experimental use defense to
Duke's ongoing FEL lab operation. We substantially agree with Madey on
all three points. In addition, Madey makes a threshold argument
concerning the continued existence of the experimental use doctrine in
any form, which we turn to first.
precedent, to which we are bound, continues to recognize the judicially
experimental use defense, however, in a very limited form.
The Experimental Use Defense
Citing the concurring opinion in Embrex, Madey contends that the
Supreme Court's opinion in Warner-Jenkinson Co. v. Hilton-Davis Chem.
Co., 520 U.S. 17, 137 L. Ed. 2d 146, 117 S. Ct. 1040 (1997) eliminates
the experimental use defense. Embrex, 216 F.3d at 1352-53, 55
U.S.P.Q.2D (BNA) at 1166-67 (Rader, J., concurring). The Supreme Court
held in Warner-Jenkinson that intent plays no role in the application
of the doctrine of equivalents. Warner-Jenkinson, 520 U.S. at 36. Madey
implicitly argues that the experimental use defense necessarily
incorporates an intent inquiry, and thus is inconsistent with
Like the majority in Embrex, we do not view such an inconsistency as
inescapable, and conclude the experimental use defense persists albeit
in the very narrow form articulated by this court in Embrex, 216 F.3d
at 1349, 55 U.S.P.Q.2D (BNA) at 1163, and in Roche, 733 F.2d at 863,
221 U.S.P.Q. (BNA) at 940.
The District Court Improperly Shifted the Burden to Madey
As a precursor to the burden-shifting issue, [**28]
argues that the experimental use defense is an affirmative defense that
Duke must plead or lose. We disagree. Madey points to no source of
authority for its assertion that experimental use is an affirmative
defense. Indeed, we have referred to the defense in a variety of ways.
See Roche, 733 F.2d at 862, 221 U.S.P.Q. (BNA) at 939-40 (referring to
experimental use as both an exception and a
defense). Given this lack of precise treatment in the precedent, Madey
has no basis to support its affirmative defense argument. The district
court and the parties in the present case joined the issue during the
summary judgment briefing.
We see no mandate
from our precedent, nor any compelling reason from other
considerations, why the opportunity to raise the defense if not raised
in the responsive pleading should not also be available at the later
stages of a case, within the procedural discretion typically afforded
the trial court judge.
The district court held that in order for Madey to overcome his burden
to establish actionable infringement, he must establish that Duke did
not use the patent-covered free electron laser equipment solely for
experimental or other non-profit purposes. [**29]
Judgment Opinion at 10. Madey argues that this improperly shifts the
burden to the patentee and conflates the experimental use defense with
the initial infringement inquiry.
We agree with Madey that the district court improperly shifted the
burden to him. The district court folded the experimental use defense
into the baseline assessment as to whether Duke infringed the patents.
Duke characterizes the district court's holding as expressing the
following sequence: first, the court recognized that Madey carried his
burden of proof on infringement; second, the court held that Duke
carried its burden of proof on the experimental use defense; and third,
the court held that Madey was unable to marshal sufficient evidence to
rebut Duke's shifting of the burden. We disagree with Duke's reading of
the district court's opinion. See Summary Judgment Opinion at 8-14. The
district court explicitly contradicts Duke's argument by stating that
Madey failed to "meet its burden to establish patent infringement by a
preponderance of the evidence." Id. at 13. This statement is an
assessment of whether Madey supported his initial infringement claim.
It is not an assessment of which [**30]
party carried or shifted the
burden of evidence related to the experimental use defense. Thus, the
district court did not conclude that Madey failed to rebut Duke's
assertion of the experimental use defense. Instead, it erroneously
required Madey to show as a part of his initial claim that Duke's use
was not experimental.
The defense, if available
at all, must be established by Duke.
The District Court's Overly Broad Conception of Experimental Use
Madey argues, and we agree, that the district court had an overly broad
conception of the very narrow and strictly limited experimental use
defense. The district court stated that the experimental use defense
inoculated uses that "were solely for research, academic, or
experimental purposes," and that the defense covered use that "is made
for experimental, non-profit purposes only." Id. at 9. Both
formulations are too broad and stand in sharp [*1362]
contrast to our admonitions in Embrex and Roche that
experimental use defense is very narrow and strictly limited. In
Embrex, we followed the teachings of Roche and Pitcairn to hold that
the defense was very narrow and limited to actions performed "for
amusement, to [**31]
satisfy idle curiosity, or for strictly philosophical inquiry." Embrex,
216 F.3d at 1349, 55 U.S.P.Q.2D (BNA) at 1163. Further, use does not
qualify for the experimental use defense when it is undertaken in the
"guise of scientific inquiry" but has "definite, cognizable, and not
insubstantial commercial purposes." Id. (quoting Roche, 733 F.2d at
863, 221 U.S.P.Q. (BNA) at 941). The concurring opinion in Embrex
expresses a similar view: use is disqualified from the defense if it
has the "slightest commercial implication." 216 F.3d at 1353, 55
U.S.P.Q.2D (BNA) at 1166. Moreover, use in keeping with the legitimate
business of the alleged infringer does not qualify for the experimental
use defense. See Pitcairn, 547 F.2d at 1125-26, 192 U.S.P.Q. (BNA) at
625. The district court supported its conclusion with a citation to
Ruth v. Stearns-Roger Mfg. Co., 13 F. Supp. 697, 713 (D. Colo. 1935), a
case that is not binding precedent for this court.
The Ruth case represents the conceptual dilemma that may have led the
district court astray. Cases evaluating the experimental use defense
are few, and those involving non-profit, educational alleged
are even fewer. In Ruth, the court concluded that a manufacturer of
equipment covered by patents was not liable for contributory
infringement because the end-user purchaser was the Colorado School of
Mines, which used the equipment in furtherance of its educational
purpose. Id. Thus, the combination of apparent lack of commerciality,
with the non-profit status of an educational institution, prompted the
court in Ruth, without any detailed analysis of the character, nature
and effect of the use, to hold that the experimental use defense
applied. Id. This is not consistent with the binding precedent of our
case law postulated by Embrex, Roche and Pitcairn.
Our precedent clearly does not immunize use that
is in any way commercial in nature. Similarly, our precedent does not
immunize any conduct that is in keeping with the alleged infringer's
legitimate business, regardless of commercial implications. For
example, major research universities, such as Duke, often sanction and
fund research projects with arguably no commercial application
whatsoever. However, these projects unmistakably further the
institution's legitimate business objectives, including educating [**33]
enlightening students and faculty participating in these projects.
These projects also serve, for example, to increase the status of the
institution and lure lucrative research grants, students and faculty.
regardless of whether a particular
institution or entity is engaged in an endeavor for commercial gain, so
long as the act is in furtherance of the alleged infringer's legitimate
business and is not solely for amusement, to satisfy idle curiosity, or
for strictly philosophical inquiry, the act does not qualify for the
very narrow and strictly limited experimental use defense. Moreover,
the profit or non-profit status of the user is not determinative.
In the present case, the district court attached too great a weight to
the non-profit, educational status of Duke, effectively suppressing the
fact that Duke's acts appear to be in accordance with any reasonable
interpretation of Duke's legitimate business objectives. n7 On remand,
the district [*1363]
court will have to significantly narrow and limit its conception of the
experimental use defense. The correct focus should not be on the
non-profit status of Duke but on the legitimate business Duke is
involved in and whether [**34]
or not the use was solely for amusement, to satisfy idle curiosity, or
for strictly philosophical inquiry....
The district court erred in its application of the common law
experimental use defense, and, consequently, incorrectly found that
there was no genuine issue of material fact upon which Madey could
prevail.... Due to these errors, further proceedings are
necessary.... Accordingly, we affirm-in-part and reverse-in-part the
district court's decision and remand for additional proceedings
consistent with this opinion.
AFFIRMED-IN-PART, REVERSED-IN-PART, AND REMANDED.