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Vol. 34 • No. 3 • March 2015
Of Counsel Interview…
Litigating for the Greater Good: Knobbe Martens
Lawyer Scores Big Wins
Recently patent litigator Joseph Re was
handling a major case for a prominent
medical device manufacturer. Gerard von
Hoffmann, Re’s friend and partner at Irvine,
CA-based Knobbe Martens Olson & Bear,
one of the nation’s largest intellectual prop-
erty firms, got a call from one of the com-
pany’s board members.
“I knew a number of the board members
and they wanted to know about Joe—a lot
was at stake in this case,” von Hoffmann
recalls. The board member told him this about
Re: “‘I don’t know if he’s right or not, but he
sure does have a lot of confidence.’ Well, Joe
was right and he won,” von Hoffmann adds.
Re tends to win a lot of victories, including
a $467 million jury award in a patent infringe-
ment suit brought by his long-standing client,
the bio-tech company Masimo Corp., against
Philips Electronics North America Corp. It
was the third-largest legal judgment in the
United States in 2014. But Re is most proud
that the victory means more hospitals will
be able to offer patients Masimo’s highly
acclaimed pulse oximetery monitoring tech-
nology, which has improved health care while
reducing the costs of care.
Von Hoffmann takes responsibility for
recruiting Re, or at least helping recruit
the charismatic New York native in the
mid-1980s, that is, once the other Knobbe
Martens attorneys agreed that Re would be a
good fit for the partnership.
“Joe can articulate his views with refreshing
clarity and he certainly fills the room,” von
Hoffmann says. “And when we were discuss-
ing whether to hire him or not, his qualifica-
tions were never in question. The discussion
centered around whether his strong presence
would affect the firm, because back then,
there were under 20 of us and at least eight
or 10 of him. We decided that we should hire
him and we did, and we figured he would
affect the firm and he did.”
Not only did Re fit into the culture of
the Southern California-based firm, he soon
became one of its leaders, helping hire attor-
neys to build its ranks from 21 lawyers when
he came aboard to some 275 today. But
mostly he’s known for the dynamic (and often
witty) personality, legal expertise, and trial
experience he brings to the courtroom. “Joe
is in control of his environment completely,”
von Hoffmann says. “He’s also, to some
extent, the class clown. The reason he gets
away with that is because he delivers. He does
his homework, he gets it right, and he wins.”
Recently, Of Counsel talked with Re about
his upbringing, legal career, hiring experi-
ence, the Masimo litigation, and other topics.
What follows is that excerpted interview.
Of Counsel: What made you decide to
become a lawyer, Joe?
Joseph Re: First of all, my parents met in
law school and were both lawyers. My father
was a law professor at St. John’s University,
where he taught for 55 years. When I was
growing up, he was with the government,
adjudicating cases in Washington, DC. So I
grew up in a very law-oriented house. I am
Of Counsel, March 20152
one of 12 children, from the same set of par-
ents. I have seen trials since I was nine years
old, and my father would bring home the
work almost every day, asking for opinions
from the gallery [laughter] about his cases.
OC: You went to Rutgers University to
get your engineering degree with the intent
of going to law school. Did you think that
intellectual property law would be the right
course for you?
JR: No doubt about it. My brothers and I
were into construction. I’m the youngest of
five boys and my older brothers ran a con-
struction company, which is still going on to
this day. So I worked my way through school
working construction, and civil engineering,
of the technical [fields of study], seemed like
the one I found the most interesting and that
I could understand.
And then, lo and behold, when I started
law school, they created the Federal Circuit
and all the patent cases were going to one
appellate courthouse. Right from the begin-
ning, my father said to me, “You’ve got to
gun for a clerkship at that courthouse.”
OC: You clerked for Judge Markey.
JR: Yes, Chief Judge Markey was the first
judge of that court, and he knew my father
well. He gave me one piece of advice. He
said, “I can’t hire you because it will look
unfair, unless you make editor of your law
review. You’ve got to become the editor of
your law review.” So I knew as a freshman
that I had to become the editor, which I did
and then the next day he called me up and
said, “I’ve got a clerkship for you.”
OC: You clerked for him for a couple of
years, and then where did you go?
JR: I went to Knobbe and I’ve been here
ever since. They recruited me because some
of the other law clerks were coming here,
including Gerard von Hoffmann, who is still
a partner here. So Gerard and I have known
each other since 1985.
Influencing the Rule
of Patent Law
OC: When you think of some of the early
work you did, what one or two of the cases
stand out to you and why?
JR: As a young lawyer, I worked with
Don Martens on a patent case for American
Airlines. That jumps out because the Supreme
Court of the United States granted certiorari
for that case, on the right to trial by jury on
the validity of patents. That case actually set
up what became, the next year, the grant of
certiorari in the Markman case [Markman v.
Westview Instruments, Inc.], which was the
Seventh Amendment right of trial by jury on
claim construction on a patent case.
That was a very significant case and I felt
like we helped pave the way to further define
the right of trial by jury in a patent case. I got
to work closely with Don Martens for many
years on that case; he was obviously one of
my mentors. He has since retired but he was
one of the founders and really was the first
litigation lawyer in this firm.
In another one that stands out, I helped get
a case before the Supreme Court, and I par-
ticipated in writing an amicus brief to get the
Supreme Court interested in fixing another
rule in patent law.
OC: You mentioned writing the amicus
brief and that you were the editor of the law
review. Do you advise young attorneys about
the importance of writing? And if so, are
they receptive?
JR: The answer is absolutely yes, and the
receptivity—varies [laughter]. I always try to
remind the young lawyers that I started out
exactly like them. In fact, sometimes they
have a head start on me because they prob-
ably went to more prestigious schools. The
kind of associates that our firm gets today
are superior to any of those we used to see 30
years ago. These are top-of-the-class, top law
school people who come to the firm today.
3Of Counsel, Vol. 34, No. 3
But the thing that separates the success-
ful young lawyer from the unsuccessful one
is that the successful one always branches
out and does things professionally beyond
the actual billable hour. So if two associates
start out and they both bill nine hours a
day, the person who succeeds is the one who
volunteers to assist in the writing of articles,
speeches, chapters, books, whatever. That
person is showing much more of an interest
and is working harder and really rounding
out their writing skills. I think that’s key. And
not just writing, but speaking too. Usually
good writers are good speakers. They go
hand-in-hand a lot of the time, so I really
encourage everybody to improve their writ-
ing skills.
OC: How long did you help with recruiting?
JR: I did that for 16 years. I became a
partner in 1990 and the first question you get
when you become a partner is: “How would
you like to help in the firm management?”
I said I’d like to get involved in recruiting.
The firm at that time had about 30 lawyers.
And the partners were happy to have me help
recruit. So I started working on recruiting
with a few other lawyers and our job was
to build the firm and diversify the lawyer
population.
When I got here the firm was very Midwest.
All the founding partners and a lot of the
senior lawyers came from flyover states, as
far as I’m concerned [chuckles]. They came
from places like Illinois, Wisconsin, North
Dakota, Minnesota, Ohio—places I had
never been. I was determined, along with
some of the other lawyers, to really get
people from throughout the country, other
countries as well, and we went on a recruit-
ing push throughout the 90s to visit all these
campuses.
I remember at one recruiting meeting in
1993 we discussed what campuses we should
go to. I said, “Let’s start with Harvard.”
Everybody laughed and said, “We can’t get
Harvard lawyers interested in patent law
to come here.” And I said, “Why not?”
One of the senior partners, Louis Knobbe,
said, “Yeah, why not?” We insulted his firm
when we said no one would come here from
Harvard. Well, we went to Harvard, and the
first time we came back with two recruits, two
new associates, both from Harvard, because,
in the early 90s, firms weren’t hiring but
we were. That’s what started the explosion of
the firm and by the time I finished recruiting
we had well over 200 lawyers, which means we
must’ve hired 300 to 400 to get to 200 and
something.
Now I’ve got tremendous support in all my
cases because many of these lawyers who are
in their 40s or late 30s I helped hire. I know
them well.
OC: Of course in the early 90s, IP was just
beginning to grow and so the need for IP
attorneys was also beginning to grow.
JR: Yes, in the early 90s, because firms like
ours were hiring, the general practice firms
noticed and thought that maybe this IP area
is recession proof. So, throughout the 90s
the general practice firms started building
or expanding their IP groups. Consequently,
many of the firms that were referring cases to
us all of a sudden became our competitors.
And, that’s where we are today. But you’re
right: I come from an era when not a lot of
lawyers wanted to do this work. My patent
law class had four people in it. The Ivy League
schools did not offer patent law classes in the
1980s. So the change has been remarkable.
Watching the Growth
OC: In terms of recruiting and maybe
more broadly in terms of the management
side of being a partner, what is really satisfy-
ing and then what is really challenging?
JR: Well, the most satisfying thing is when
I see someone who started at the firm and I
look at them 10 years later and say, “Wow,
look at this person now.” I like sports. I like
scouting. I like to see talent. I really get a
charge out of seeing somebody who’s a little
Of Counsel, March 20154
rough around the edges but has great brain-
power and has some charisma and I say this
person is outgoing and has a great career
ahead of him or her and doesn’t even know
it. And they doubt it when I tell them [that
they have a lot of potential and a great career
ahead of them] when they’re 25. They say,
“Really? Really?”
But then I get to talk to them when they’re
35 and 38 and 40 and I say, “Do you remem-
ber that conversation we had?” And they say,
“Yeah, I can’t believe I said that to you.”
I know these people really, really well and
nothing is more satisfying than watching the
development of a young lawyer.
OC: Thank you. Now about the other side.
What keeps you up at night? What are the
problem areas?
JR: The problem areas are the lawyers
who’ve been told by their mothers that they
are the greatest person ever, the people who
go to law school for the wrong reasons, those
who are interested in money and nothing
else, those were not dedicated to the profes-
sion, those who think they can do it part-
time. Those are the problem areas. They
look at me sometimes and they think I’m
a madman by how much I work, but I tell
them that they can’t do this part-time. You
have to stay current. Every day when you
wake up you have to ask, what’s new? What
can I do today? How can I prove my clients’
cases? You have to be obsessed otherwise
some lawyer will just take the case from you
[laughter].
OC: To shift gears here a little bit, how
much has your engineering degree helped
you in your IP practice?
JR: Tremendously. First of all, you need
a science background to get admitted to
the patent office. The first thing I did in law
school was get admitted to the patent office
because I want to make sure I would get a
job. It was the early 80s and jobs weren’t that
great yet. So I got admitted to the patent
office to show interest in the field.
But in general I can really tell those who
fear technology and those who don’t. The
problem is, many people who don’t have
technical backgrounds sometimes have this
reluctance to really dig down and learn tech-
nology. You have to learn the technology. An
engineering background gives you the apti-
tude. I’m not concerned about whether some-
one has a degree in chemical engineering or
electrical engineering or civil engineering or
mechanical engineering. If you went through
engineering school and you did well in law
school, I’ll take you. You’re pretty smart. So
in our firm 95 percent of our lawyers have
technical backgrounds. That gives us the
depth that many firms simply don’t have.
The Gold Standard
OC: Great. So let’s get to this big victory
that was handed down recently in the case
involving your client Masimo. What’s impor-
tant about that case? Why is it a headline
maker?
JR: It’s probably a headline maker for the
wrong reason. It’s probably a headline maker
because it’s one of the largest verdicts in 2014
at $467 million. But it’s really not about the
money.
OC: What should the headline be?
JR: Well, the real goal of the litigation is
to get the Masimo technology to serve as the
gold standard, the default, because it’s truly
the best technology. It’s life-saving, and it’s
an absolute shame that many hospitals do
not adopt it at first. It’s such a complicated
story, and there will be books written about
it, I promise you. For Masimo to break
through the hospital market with this innova-
tion was a story of unbelievable perseverance
by Joe Kiani.
OC: He’s the CEO.
JR: Yes, he founded the company back in
’89 and he had this great technology. He just
assumed that because it was so great and
life-saving and cost-saving that people would
want it. But he discovered that many hospi-
tals couldn’t buy it. They were prohibited
from buying it. That was a head-scratcher
for him, and then he realized the hospitals
were beholden to the large GPO’s, group
purchasing organizations, with contracts
that force hospitals to buy all their goods
from certain suppliers to keep the prices at
certain levels.
He said, “This doesn’t sound right to me.
We have to change the laws.” So he liter-
ally went to Congress and started knocking
on the senators’ doors. And in mid-2002
on the front page of The New York Times
was Joe’s story. The Times ran a series of
articles about this issue. All of a sudden the
GPO’s backed off and said we promise we
won’t do it anymore. And then Masimo and
some of my other clients were able to sell
directly to the hospitals, without penalizing
the hospitals, so they could improve their
technology.
[Except that Phillips, the defendant in the
case, was not offering the Masimo technol-
ogy as the standard.] They were selling their
imitation infringement as the default. So if
hospitals didn’t know Masimo by brand,
they weren’t getting it. They were getting the
infringing module.
So what we were trying to do with these
cases is to get Philips to finally offer Masimo
as the gold standard at least in proportion to
Masimo’s market share. What had been hap-
pening was that they were offering Masimo
in small quantities and pushing their own
infringement. That’s why the damages were
so high.
OC: Obviously, you’re competitive, you
want to win, you want to help your client, but
I’m sensing that you knew there was a greater
good at stake in this case.
JR: Oh, definitely. I understand that it’s
often not just about passing around the
money from one corporation to another.
And, what’s most important about this tech-
nology is that the health benefits have been
enormous. It saves lives, eliminates prema-
ture blindness in babies, and reduces health
care costs. It’s really been remarkable. And
it’s now becoming the standard of care in
all hospitals. So yes, this is about the greater
good. ■
—Steven T. Taylor
Copyright © 2015 CCH Incorporated. All Rights Reserved.
Reprinted from Of Counsel, March 2015, Volume 34, Number 3, pages 20–24
with permission from Wolters Kluwer, New York, NY,
1-800-638-8437, www.wklawbusiness.com

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Litigating for the Greater Good: Knobbe Martens Lawyer Scores Big Wins

  • 1. Vol. 34 • No. 3 • March 2015 Of Counsel Interview… Litigating for the Greater Good: Knobbe Martens Lawyer Scores Big Wins Recently patent litigator Joseph Re was handling a major case for a prominent medical device manufacturer. Gerard von Hoffmann, Re’s friend and partner at Irvine, CA-based Knobbe Martens Olson & Bear, one of the nation’s largest intellectual prop- erty firms, got a call from one of the com- pany’s board members. “I knew a number of the board members and they wanted to know about Joe—a lot was at stake in this case,” von Hoffmann recalls. The board member told him this about Re: “‘I don’t know if he’s right or not, but he sure does have a lot of confidence.’ Well, Joe was right and he won,” von Hoffmann adds. Re tends to win a lot of victories, including a $467 million jury award in a patent infringe- ment suit brought by his long-standing client, the bio-tech company Masimo Corp., against Philips Electronics North America Corp. It was the third-largest legal judgment in the United States in 2014. But Re is most proud that the victory means more hospitals will be able to offer patients Masimo’s highly acclaimed pulse oximetery monitoring tech- nology, which has improved health care while reducing the costs of care. Von Hoffmann takes responsibility for recruiting Re, or at least helping recruit the charismatic New York native in the mid-1980s, that is, once the other Knobbe Martens attorneys agreed that Re would be a good fit for the partnership. “Joe can articulate his views with refreshing clarity and he certainly fills the room,” von Hoffmann says. “And when we were discuss- ing whether to hire him or not, his qualifica- tions were never in question. The discussion centered around whether his strong presence would affect the firm, because back then, there were under 20 of us and at least eight or 10 of him. We decided that we should hire him and we did, and we figured he would affect the firm and he did.” Not only did Re fit into the culture of the Southern California-based firm, he soon became one of its leaders, helping hire attor- neys to build its ranks from 21 lawyers when he came aboard to some 275 today. But mostly he’s known for the dynamic (and often witty) personality, legal expertise, and trial experience he brings to the courtroom. “Joe is in control of his environment completely,” von Hoffmann says. “He’s also, to some extent, the class clown. The reason he gets away with that is because he delivers. He does his homework, he gets it right, and he wins.” Recently, Of Counsel talked with Re about his upbringing, legal career, hiring experi- ence, the Masimo litigation, and other topics. What follows is that excerpted interview. Of Counsel: What made you decide to become a lawyer, Joe? Joseph Re: First of all, my parents met in law school and were both lawyers. My father was a law professor at St. John’s University, where he taught for 55 years. When I was growing up, he was with the government, adjudicating cases in Washington, DC. So I grew up in a very law-oriented house. I am
  • 2. Of Counsel, March 20152 one of 12 children, from the same set of par- ents. I have seen trials since I was nine years old, and my father would bring home the work almost every day, asking for opinions from the gallery [laughter] about his cases. OC: You went to Rutgers University to get your engineering degree with the intent of going to law school. Did you think that intellectual property law would be the right course for you? JR: No doubt about it. My brothers and I were into construction. I’m the youngest of five boys and my older brothers ran a con- struction company, which is still going on to this day. So I worked my way through school working construction, and civil engineering, of the technical [fields of study], seemed like the one I found the most interesting and that I could understand. And then, lo and behold, when I started law school, they created the Federal Circuit and all the patent cases were going to one appellate courthouse. Right from the begin- ning, my father said to me, “You’ve got to gun for a clerkship at that courthouse.” OC: You clerked for Judge Markey. JR: Yes, Chief Judge Markey was the first judge of that court, and he knew my father well. He gave me one piece of advice. He said, “I can’t hire you because it will look unfair, unless you make editor of your law review. You’ve got to become the editor of your law review.” So I knew as a freshman that I had to become the editor, which I did and then the next day he called me up and said, “I’ve got a clerkship for you.” OC: You clerked for him for a couple of years, and then where did you go? JR: I went to Knobbe and I’ve been here ever since. They recruited me because some of the other law clerks were coming here, including Gerard von Hoffmann, who is still a partner here. So Gerard and I have known each other since 1985. Influencing the Rule of Patent Law OC: When you think of some of the early work you did, what one or two of the cases stand out to you and why? JR: As a young lawyer, I worked with Don Martens on a patent case for American Airlines. That jumps out because the Supreme Court of the United States granted certiorari for that case, on the right to trial by jury on the validity of patents. That case actually set up what became, the next year, the grant of certiorari in the Markman case [Markman v. Westview Instruments, Inc.], which was the Seventh Amendment right of trial by jury on claim construction on a patent case. That was a very significant case and I felt like we helped pave the way to further define the right of trial by jury in a patent case. I got to work closely with Don Martens for many years on that case; he was obviously one of my mentors. He has since retired but he was one of the founders and really was the first litigation lawyer in this firm. In another one that stands out, I helped get a case before the Supreme Court, and I par- ticipated in writing an amicus brief to get the Supreme Court interested in fixing another rule in patent law. OC: You mentioned writing the amicus brief and that you were the editor of the law review. Do you advise young attorneys about the importance of writing? And if so, are they receptive? JR: The answer is absolutely yes, and the receptivity—varies [laughter]. I always try to remind the young lawyers that I started out exactly like them. In fact, sometimes they have a head start on me because they prob- ably went to more prestigious schools. The kind of associates that our firm gets today are superior to any of those we used to see 30 years ago. These are top-of-the-class, top law school people who come to the firm today.
  • 3. 3Of Counsel, Vol. 34, No. 3 But the thing that separates the success- ful young lawyer from the unsuccessful one is that the successful one always branches out and does things professionally beyond the actual billable hour. So if two associates start out and they both bill nine hours a day, the person who succeeds is the one who volunteers to assist in the writing of articles, speeches, chapters, books, whatever. That person is showing much more of an interest and is working harder and really rounding out their writing skills. I think that’s key. And not just writing, but speaking too. Usually good writers are good speakers. They go hand-in-hand a lot of the time, so I really encourage everybody to improve their writ- ing skills. OC: How long did you help with recruiting? JR: I did that for 16 years. I became a partner in 1990 and the first question you get when you become a partner is: “How would you like to help in the firm management?” I said I’d like to get involved in recruiting. The firm at that time had about 30 lawyers. And the partners were happy to have me help recruit. So I started working on recruiting with a few other lawyers and our job was to build the firm and diversify the lawyer population. When I got here the firm was very Midwest. All the founding partners and a lot of the senior lawyers came from flyover states, as far as I’m concerned [chuckles]. They came from places like Illinois, Wisconsin, North Dakota, Minnesota, Ohio—places I had never been. I was determined, along with some of the other lawyers, to really get people from throughout the country, other countries as well, and we went on a recruit- ing push throughout the 90s to visit all these campuses. I remember at one recruiting meeting in 1993 we discussed what campuses we should go to. I said, “Let’s start with Harvard.” Everybody laughed and said, “We can’t get Harvard lawyers interested in patent law to come here.” And I said, “Why not?” One of the senior partners, Louis Knobbe, said, “Yeah, why not?” We insulted his firm when we said no one would come here from Harvard. Well, we went to Harvard, and the first time we came back with two recruits, two new associates, both from Harvard, because, in the early 90s, firms weren’t hiring but we were. That’s what started the explosion of the firm and by the time I finished recruiting we had well over 200 lawyers, which means we must’ve hired 300 to 400 to get to 200 and something. Now I’ve got tremendous support in all my cases because many of these lawyers who are in their 40s or late 30s I helped hire. I know them well. OC: Of course in the early 90s, IP was just beginning to grow and so the need for IP attorneys was also beginning to grow. JR: Yes, in the early 90s, because firms like ours were hiring, the general practice firms noticed and thought that maybe this IP area is recession proof. So, throughout the 90s the general practice firms started building or expanding their IP groups. Consequently, many of the firms that were referring cases to us all of a sudden became our competitors. And, that’s where we are today. But you’re right: I come from an era when not a lot of lawyers wanted to do this work. My patent law class had four people in it. The Ivy League schools did not offer patent law classes in the 1980s. So the change has been remarkable. Watching the Growth OC: In terms of recruiting and maybe more broadly in terms of the management side of being a partner, what is really satisfy- ing and then what is really challenging? JR: Well, the most satisfying thing is when I see someone who started at the firm and I look at them 10 years later and say, “Wow, look at this person now.” I like sports. I like scouting. I like to see talent. I really get a charge out of seeing somebody who’s a little
  • 4. Of Counsel, March 20154 rough around the edges but has great brain- power and has some charisma and I say this person is outgoing and has a great career ahead of him or her and doesn’t even know it. And they doubt it when I tell them [that they have a lot of potential and a great career ahead of them] when they’re 25. They say, “Really? Really?” But then I get to talk to them when they’re 35 and 38 and 40 and I say, “Do you remem- ber that conversation we had?” And they say, “Yeah, I can’t believe I said that to you.” I know these people really, really well and nothing is more satisfying than watching the development of a young lawyer. OC: Thank you. Now about the other side. What keeps you up at night? What are the problem areas? JR: The problem areas are the lawyers who’ve been told by their mothers that they are the greatest person ever, the people who go to law school for the wrong reasons, those who are interested in money and nothing else, those were not dedicated to the profes- sion, those who think they can do it part- time. Those are the problem areas. They look at me sometimes and they think I’m a madman by how much I work, but I tell them that they can’t do this part-time. You have to stay current. Every day when you wake up you have to ask, what’s new? What can I do today? How can I prove my clients’ cases? You have to be obsessed otherwise some lawyer will just take the case from you [laughter]. OC: To shift gears here a little bit, how much has your engineering degree helped you in your IP practice? JR: Tremendously. First of all, you need a science background to get admitted to the patent office. The first thing I did in law school was get admitted to the patent office because I want to make sure I would get a job. It was the early 80s and jobs weren’t that great yet. So I got admitted to the patent office to show interest in the field. But in general I can really tell those who fear technology and those who don’t. The problem is, many people who don’t have technical backgrounds sometimes have this reluctance to really dig down and learn tech- nology. You have to learn the technology. An engineering background gives you the apti- tude. I’m not concerned about whether some- one has a degree in chemical engineering or electrical engineering or civil engineering or mechanical engineering. If you went through engineering school and you did well in law school, I’ll take you. You’re pretty smart. So in our firm 95 percent of our lawyers have technical backgrounds. That gives us the depth that many firms simply don’t have. The Gold Standard OC: Great. So let’s get to this big victory that was handed down recently in the case involving your client Masimo. What’s impor- tant about that case? Why is it a headline maker? JR: It’s probably a headline maker for the wrong reason. It’s probably a headline maker because it’s one of the largest verdicts in 2014 at $467 million. But it’s really not about the money. OC: What should the headline be? JR: Well, the real goal of the litigation is to get the Masimo technology to serve as the gold standard, the default, because it’s truly the best technology. It’s life-saving, and it’s an absolute shame that many hospitals do not adopt it at first. It’s such a complicated story, and there will be books written about it, I promise you. For Masimo to break through the hospital market with this innova- tion was a story of unbelievable perseverance by Joe Kiani. OC: He’s the CEO. JR: Yes, he founded the company back in ’89 and he had this great technology. He just assumed that because it was so great and
  • 5. life-saving and cost-saving that people would want it. But he discovered that many hospi- tals couldn’t buy it. They were prohibited from buying it. That was a head-scratcher for him, and then he realized the hospitals were beholden to the large GPO’s, group purchasing organizations, with contracts that force hospitals to buy all their goods from certain suppliers to keep the prices at certain levels. He said, “This doesn’t sound right to me. We have to change the laws.” So he liter- ally went to Congress and started knocking on the senators’ doors. And in mid-2002 on the front page of The New York Times was Joe’s story. The Times ran a series of articles about this issue. All of a sudden the GPO’s backed off and said we promise we won’t do it anymore. And then Masimo and some of my other clients were able to sell directly to the hospitals, without penalizing the hospitals, so they could improve their technology. [Except that Phillips, the defendant in the case, was not offering the Masimo technol- ogy as the standard.] They were selling their imitation infringement as the default. So if hospitals didn’t know Masimo by brand, they weren’t getting it. They were getting the infringing module. So what we were trying to do with these cases is to get Philips to finally offer Masimo as the gold standard at least in proportion to Masimo’s market share. What had been hap- pening was that they were offering Masimo in small quantities and pushing their own infringement. That’s why the damages were so high. OC: Obviously, you’re competitive, you want to win, you want to help your client, but I’m sensing that you knew there was a greater good at stake in this case. JR: Oh, definitely. I understand that it’s often not just about passing around the money from one corporation to another. And, what’s most important about this tech- nology is that the health benefits have been enormous. It saves lives, eliminates prema- ture blindness in babies, and reduces health care costs. It’s really been remarkable. And it’s now becoming the standard of care in all hospitals. So yes, this is about the greater good. ■ —Steven T. Taylor Copyright © 2015 CCH Incorporated. All Rights Reserved. Reprinted from Of Counsel, March 2015, Volume 34, Number 3, pages 20–24 with permission from Wolters Kluwer, New York, NY, 1-800-638-8437, www.wklawbusiness.com