Intellectual Property – Post-Trial

June 6, 2012

Publication| Intellectual Property

Judge Robinson Rules that Patents Are Not Invalid

In OSI Pharmaceuticals, Inc. v. Mylan Pharmaceuticals Inc., C.A. No. 09-185-SLR (D. Del. May 1, 2012), Judge Robinson concluded after a bench trial that defendant Mylan Pharmaceuticals, Inc. failed to prove that the patents-in-suit, which concerned a compound for treating a particular kind of lung cancer, were invalid. The Court found that the first patent-in-suit, a reissue, was not proven to be obvious. Judge Robinson noted that the Patent & Trademark Office had reissued this patent even after considering the reference that Mylan relied on as prior art. The Court also concluded that Mylan failed to show that the other patent-in-suit was invalid: one of the prior art references relied on by Mylan disclosed too many compounds for the treatment of too many different kinds of cancers, as compared with the patent-in-suit, which disclosed a single compound for the treatment of a particular kind of lung cancer. Judge Robinson found that the other reference, an abstract presented at a conference, did not inherently disclose the use of a carrier for the compound. In addition, the tests disclosed in the abstract were performed on tumor models and not patients. For largely the same reasons, these same references did not render the patent obvious. Judge Robinson also credited as a secondary consideration of non-obviousness the “almost insurmountable” failure rate for new drugs to treat this kind of lung cancer.

Chief Judge Sleet Invalidates Patents on Finding of Obviousness

In Allergan, Inc. v. Watson Laboratories, Inc.-Florida, 2012 WL 1133684 (D. Del. Mar. 31, 2012), Chief Judge Sleet ruled on the parties’ post-trial proposed findings of fact and conclusions of law. The Court concluded that: (1) all asserted claims of the patents-in-suit were invalid due to obviousness; (2) the asserted claims of the patents-in-suit were not invalid due to anticipation; (3) certain claims of the patents were not invalid due to indefiniteness; (4) no claim of the patents was invalid due to written description; (5) defendants’ proposed products infringed the asserted claims of the patents-in-suit; and (6) each of the parties’ Rule 52(c) motions were granted in part and denied in part. The Court found that all asserted claims of the asserted patents were obvious after examining the prior art and finding a motivation to develop a once-a-day formulation of the drug at issue. In making this determination, the Court held that defendants’ alleged copying of the patented invention did not rebut the prima facie case of obviousness.

Judge Robinson Denies Motion to Reargue and Modify Injunction

In In re Cyclobenzaprine Hydrochloride Extended-Release Capsule Patent Litigation, C.A. No. 09-MD-2118-SLR (D. Del. Mar. 15, 2012), Judge Robinson denied defendant Impax Laboratories, Inc.’s motion to reargue and modify an injunction preventing it from launching a generic version of plaintiff Eurand, Inc.’s AMRIX® pain drug. Impax had settled with Eurand and its exclusive licensee Anesta AG, the other plaintiff, before trial, receiving a license to manufacture a generic version of AMRIX® once any third party not entitled to first-to-file exclusivity or licensed by Eurand began to market a generic version of the drug. After trial, the jury returned a verdict that the patents-in-suit were invalid, and Mylan Pharmaceuticals, Inc., one of the other defendants, launched its generic product. Eurand, in turn, began to sell a generic version of AMRIX® through Watson Pharmaceuticals. Relying on the license provided for in the settlement agreement and the sale by Watson, Impax began to sell its generic product as well, but upon motion by plaintiffs Judge Robinson enjoined Mylan and, after amendment, Impax from selling their generics.

Impax moved to reargue and modify the injunction to allow it to sell its generic product under the license from Eurand, but the Court, declining to give Impax a “windfall,” found that the clause at issue in the settlement agreement was not triggered by Eurand’s sale of its own product through a sales agent. Hence, the injunction stood as ordered, but the Court noted that even without the injunction the terms of the settlement itself prevented Impax from marketing its product.

Judge Robinson Denies Renewed Motion for Judgment as a Matter of Law

In Boston Scientific Corp. v. Cordis Corp., C.A. No. 10-315-SLR (D. Del. Mar. 13, 2012), Judge Robinson ruled on the parties’ post-trial motions following a trial in which Cordis Corp.’s infringement of patents held by plaintiffs Boston Scientific Corp. and Boston Scientific Scimed, Inc. (together, “BSC”) was found to be willful. Cordis renewed its motion for judgment as a matter of law on the availability of lost profits damages, arguing that insufficient evidence supported the jury’s necessarily implied finding that Cordis’ sale of a 2.25mm drug-eluting stent was a but-for cause of 44% of the lost sales on one of BSC’s stents. Noting that “Cordis’s challenge of the lost profit award focused on the availability of lost profits damages, rather than the amount,” Judge Robinson concluded that sufficient evidence supported the jury’s verdict and denied Cordis’ motion.

Recognizing that courts have been hesitant to order permanent injunctions in stent cases, BSC moved instead for ongoing reasonable royalty damages, which the Court granted. The Court declined to award attorneys’ fees to BSC under 35 U.S.C. § 285, since it did not show any evidence of misconduct on the part of Cordis during the litigation, and it was “the court’s view that attorney fees are more aptly awarded for abusive litigation tactics.” Upon considering the factors set forth in Read Corp. v. Portec Inc., 970 F.2d 816, 826–27 (Fed. Cir. 1992), for determining whether to enhance damages, Judge Robinson doubled the jury’s award.

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