In an extraordinary turn, a mistrial was declared in a patent-infringement case in Waco on Friday when the jury was deadlocked and sent home after barely four hours of deliberation.
“A hung jury in a patent case is rarer than a hen’s tooth,” said Thomas M. Melsheimer, managing partner of the Dallas office of Winston & Strawn and one of the lawyers for the defendant in the case, Medtronic Inc., a world leader in the medical devices industry.
Medtronic is being sued for patent infringement by TMT Systems Inc. of Ohio and its owner and founder, Dr. Timur Sarac, chief of vascular surgery at Ohio State University’s Wexner Medical Center. The case is before U.S. District Judge Alan D. Albright of Waco.
Attorneys for TMT Systems declined to comment on the case, including on whether they will seek a new trial.
Melsheimer, a trial lawyer with 37 years’ experience, said of the jury deadlock: “It’s fairly amazing, actually. I’ve never seen one, ever, in a patent case. It’s not that the stakes aren’t important, but it’s hard to imagine someone getting so convicted one way or another on an issue of patent infringement. Not life and death. Not freedom or incarceration. Not grave personal injury or loss.”
Hung juries are uncommon throughout the U.S. judicial system. Statistics are scant — in part because most courts don’t flag a hung jury as a final disposition but rather as just another intermediate step in the life of a case — but an often-cited report by the National Center for State Courts found that 6.2 percent of jury trials in state felony cases ended with a hung jury. In federal courts, the rate was under 2 percent for civil and criminal cases combined, the study said, and closer to 1 percent for civil trials alone.
The Waco case involves a claim by TMT Systems and Sarac that Medtronic, a 75-year-old company with operations in more than 150 countries, used Sarac’s patented design in its stent grafts, devices used to treat abdominal aortic aneurysms, or enlargements in the lower part of the body’s main artery, the aorta.
TMT Systems is represented by a team of Milbank lawyers from New York City, Washington, D.C., and Los Angeles; and by Elizabeth L. DeRieux of Capshaw DeRieux in Gladewater, a city in East Texas.
In addition to Melsheimer, Medtronic is represented by Winston & Strawn lawyers from Dallas and Chicago, including, from Dallas, partners Rex Mann and Chad Walker; and by Kelly Ransom of Kelly Hart and Hallman, who practices in the firm’s New Orleans and Austin offices.
Any lawyer who packed a week’s work of clothes for the trial left Waco in clean underwear. A jury was picked in one day on April 19. Opening statements and the start of testimony took place on April 22. After closing arguments on April 26, the seven jurors began their deliberations. The case required a unanimous verdict.
After four hours and change, a juror sent Judge Albright a note. “I am not going to be convinced to change mind,” it said. “Do we need to deliberate until I do? Because if we do, I’m voting against what I feel.” The judge, quickly deciding the deadlock was insurmountable, declared a mistrial and ordered the two sides to meet to discuss a new trial date.
The singular pronoun — “I am not going to be convinced …” — suggests that the juror who sent out the note was a minority of one. The only other note to the judge was the standard one sent at the start of deliberations informing him that a presiding juror had been chosen.
TMT Systems sued Medtronic in October 2020 for what it claimed was “longstanding, ongoing, and willful” patent infringement, involving the use of technology invented by Sarac, in its stent grafts. The latest amended version of the suit, filed in May 2023, said the grafts “have generated billions of dollars in revenue” for Medtronic.
The aorta runs from the heart through the center of the chest and abdomen. An abdominal aneurysm, a balloon-like bulge in the artery, can cause pain in the belly, sides, back and groin. A rupture at the aneurysm can cause life-threatening internal bleeding.
A common treatment is to surgically insert a tube-like stent graft into the aneurysm, attaching it to the healthy arteries above and below to create a stable channel for blood to flow through.
Sarac’s invention, the suit said, was a design that creates a more secure fit where the stent graft is anchored to the arteries and allows adjustment for use in an anatomically broader variety of patients than earlier devices, thereby reducing the risk that the graft will leak or fail. He applied for a U.S. patent on his stent in July 2002 and received it in September 2006.
In 2008, the suit said, Medtronic introduced a stent graft in Europe that, through “knowing usurpation of his invention,” incorporated novel elements of Sarac’s design. Two years later, the U.S. Food and Drug Administration approved the Medtronic device for use in the United States. Medtronic’s stent grafts have since become “wildly successful, eventually capturing over 50 percent” of the U.S. market, the suit said.
Last September, Medtronic moved for dismissal of the suit, citing its “major deficiencies,” foremost among them that Medtronic, the only defendant in the case, “does not make, use, sell, offer for sale or import” the stent grafts at the heart of the dispute.
All of those things, the motion said, are done by different companies related to Medtronic Inc. “none of which are named defendants because they are not subject to venue in this court.”
TMT Systems claimed those other companies — Medtronic USA Inc., Medtronic Vascular Inc., Medtronic Logistics, Medtronic Perfusion Systems, Medtronic Ireland, a couple of Medtronic Mexicos and others — are either wholly owned subsidiaries of Medtronic Inc. or entities otherwise owned, directed or controlled by Medtronic Inc. The suit characterized them as “the Medtronic family.”
Medtronic Inc. countered that despite having had more than a year to conduct discovery, and despite amending its suit four times, TMT Systems could not produce sufficient facts to show that Medtronic Inc. is “vicariously liable” for any acts of infringement by the other companies. Under the law, they’re neither Medtronic Inc.’s alter ego nor its agents, the motion to dismiss said. It cited as “a bedrock principle of corporate law” that “a parent corporation … is not liable for actions taken by its subsidiaries.”
“Activities of one corporate entity are not attributable to another corporate entity,” the motion said, “unless the lines between them are so blurred” that they “become one.”
The case number in the Western District of Texas is 6:20-cv-00973.