Patents as Product Liability Admissions: A Cert Petition Highlights Novel Use of Patent Filings in Whistleblower Case

by Dennis Crouch

A fascinating cert petition filed last week (Peterson v. Minerva Surgical) uses Minerva’s patents in an innovative way — attempting to use the company’s patent filings as evidence of prior knowledge of product safety issues. The petition, filed by former Minerva Surgical area sales director Dan Peterson, argues that the company’s patent application for an improved surgical device directly contradicted testimony it later gave in whistleblower retaliation arbitration proceedings.

According to the petition, in January 2017, Minerva filed Patent Application No. 15/418,635 seeking protection for a modified endometrial ablation device. The application disclosed that the original design had a defect that could “plug” uterine perforations, potentially leading to serious patient injuries. The USPTO ultimately granted the patent (No. 10,213,151) in February 2019, with claims explicitly discussing how the new design solved these safety issues.

After reviewing the patent document, I see several points that support Peterson’s argument:

1. Problem Identification: The patent explicitly describes a safety issue with the original device: when the device penetrates the uterine wall (creating a perforation), it can actually plug or seal that perforation, leading to a dangerous misdiagnosis. Specifically, the patent explains that if the energy applicator penetrates and “effectively occludes or seals the perforation”, this could result in the uterine cavity being incorrectly “characterized as non-perforated, when in fact there is a perforation.”
2. Safety Implications: The patent is remarkably direct about the serious risks this design flaw posed. It states that if the perforation is masked by the device and energy delivery proceeds, it “would likely cause thermal injury to organs within the abdominal cavity. . . .  Such an injury to organs in the patient’s abdominal cavity could be very serious and potentially life-threatening.”
3. Solution Description: The patent then describes their new design solution: adding flow channels with multiple outlets along the entire length of the device. This modification ensures that even if the device penetrates the uterine wall, gas will still flow through outlets into the abdominal cavity, making the perforation “detected easily”.

This documentation strongly supports Peterson’s central claim – that Minerva knew its original device had a dangerous defect that could mask perforations and put patients at risk.

Taking a step back: The case here is fundamentally a whistleblower retaliation case that arose under California Labor Code § 1102.5.  The underlying case enfolded as follows — noting that these facts come from Peterson’s documents and so may be biased:

Peterson worked as a sales director for Minerva Surgical. When Minerva discovered their original device had a defect that could mask uterine perforations and potentially cause serious patient injuries, they developed an improved device (the “ES”). However, rather than recall the original device, Minerva continued selling both versions simultaneously.

Peterson, concerned about patient safety, advocated for replacing the original devices with the newer ES model. When Minerva retaliated against him for raising these safety concerns, Peterson filed a whistleblower claim under California Labor Code § 1102.5. This statute prohibits employers from retaliating against employees who report suspected violations of law or safety regulations.

Due to an arbitration clause in his employment agreement, Peterson’s case was compelled to arbitration. During the arbitration proceedings, Minerva testified that “there was nothing unsafe about the original device.” The arbitrator, applying the wrong legal standard according to Peterson, ruled against him on all claims and awarded Minerva nearly $200,000 in fees and costs.

Under the Federal Arbitration Act (FAA), arbitration awards cannot be appealed, but there are limited options for challenging an award. Here, Peterson challenged the award under Section 10(a)(1) — alleging that the perjured testimony shows that the award was procured by “corruption, fraud, or undue means” — and also under the judge made theory of “manifest disregard of law.”  A difficulty here for Peterson is that the fraud claim generally requires showing it couldn’t have been discovered during arbitration and that it directly affected the arbitrator’s decision.  Manifest disregard of law is also rarely found — recognizing that legal error is not enough to satisfy that standard.

What makes this case particularly interesting is how it illustrates the practical difficulty of meeting any of these standards. Even with documentary evidence that appeared to show false testimony (the patent filings), and clear evidence the arbitrator applied the wrong legal standard to the whistleblower claim, neither the district court nor the Tenth Circuit felt they had the power to vacate the award.

This extraordinary deference to arbitrators is what Peterson challenges in his Supreme Court petition, arguing that courts have transformed limited review into essentially no review at all, raising serious constitutional concerns about the judiciary’s Article III responsibilities.

The case thus presents an opportunity to reconsider whether the current extremely narrow standard of review adequately serves the purposes of both the FAA and the Constitution, particularly in cases involving public safety and documented false testimony.

When Peterson sought to vacate the arbitration award in federal court, both the district court and Tenth Circuit declined to intervene, citing the extremely limited scope of judicial review over arbitration decisions. This has led to Peterson’s current petition to the Supreme Court, which frames the issue as a constitutional challenge to the courts’ extreme deference to arbitrators.

The case thus presents multiple layers:
1. The underlying whistleblower retaliation claim under California law
2. The arbitration proceedings where Peterson alleges Minerva prevailed through false testimony
3. The federal courts’ refusal to meaningfully review the arbitration award
4. The current constitutional challenge regarding judicial review of arbitration

This progression shows how what began as a state law whistleblower case has evolved into a broader challenge to the federal courts’ handling of arbitration awards, particularly in cases involving public safety and potential perjury.

The key element that makes this case particularly compelling is that Peterson has documentary evidence – Minerva’s own patent filings – that appears to directly contradict their arbitration testimony about device safety. This creates a stark example of how extreme deference to arbitrators may allow parties to prevail through contradictory sworn statements without meaningful judicial oversight.

The district court acknowledged at the outset that courts “must afford maximum deference to the decisions of the arbitrator” and that this deference must be “extreme” since “the standard of review of arbitral awards is among the narrowest known to law.” The court then rejected Peterson’s arguments for vacating the award — finding that Minerva’s testimony about device safety was merely a factual dispute resolved by the arbitrator, not evidence of misconduct warranting vacatur.  The 10th Circuit affirmed — repeatedly emphasizing the courts’ lack of power to review arbitration awards.  Peterson argues generally that courts’ extreme deference to arbitrators has evolved to the point where they disclaim any meaningful power of review, even in cases involving public safety and documented false testimony.