Pitt appeals from the order of Judge Schwab dismissing its complaint without prejudice instead of allowing it to file an amended complaint alleging its standing to sue.  The case was just back to the district court after the Federal Circuit ruled for Pitt in 2008-1441 that the district court erred in dismissing with prejudice.  You can read our coverage of Judge Schwab’s earlier decision, and Dennis Crouch at Patently-O covered the first CAFC decision here.

Underlying both dismissals is the fact that Pitt was not the sole owner of the patent when it first filed the complaint, but a co-owner with Carnegie-Mellon.  Because Carnegie-Mellon was not a party, the action violated the rule that all co-owners of the patent must join in the suit.  Isr. Bio-Eng’g Project v. Amgen Inc., 475 F.3d 1256, 1264–65 (Fed. Cir. 2007).   Since then, however, Pitt acquired Carnegie-Mellon’s interest and is now the sole owner.

The Federal Circuit wrote in the first appeal:

Pitt also asserts that the district court further erred when it designated its dismissal as a dismissal “with prejudice.” We find that argument persuasive. Namely, we hold that even if Carnegie Mellon is a necessary party, and even if dismissal is a proper consequence for Pitt’s failure to join Carnegie Mellon, the dismissal should have been without prejudice.

Following the CAFC’s mandate, Judge Schwab amended the judgment to dismiss Pitt’s case without prejudice.

But because Pitt is now the sole owner and can sue by itself, it moved the court for leave to amend its complaint to add the allegations that it is the sole owner.  The court declined, finding that the Federal Circuit’s mandate did not allow for it:

After careful consideration of plaintiff’s motion and brief in support, defendant Varian Medical Systems Inc.’s response and brief in opposition, and the Opinion and Mandate of the Court of Appeals for the Federal Circuit, the Court agrees with defendant that plaintiff’s motion must be dismissed. Although plaintiff’s legal position with respect to the effect of a dismissal without prejudice is not without appeal, in the abstract, the Court deems the Opinion and Mandate of the Court of Appeals to foreclose the relief plaintiff requests in this case.

Opinion, p. 2.

PATracer Note: It appears to me that the court could have allowed Pitt to amend.  While standing to sue is normally based on the facts that existed at the time of filing and cannot be retroactively cured or fixed, Paradise Creations v. UV Sales, 315 F.3d 1304, 1309 (Fed. Cir. 2003), requiring all patentees to join in the suit is not a constitutional requirement, but a prudential one.  Unlike constitutional standing issues, problems with prudential standing can be cured post-filing.

Also, it is not clear from these materials why Pitt didn’t just file a new complaint?  Perhaps the 6 year limitation on damages comes into play.  If so, maybe they should have filed a new action when it first became the sole owner.

2010-1157 Order

Pantentee Sorensen again attempts to appeal from the Order of Judge Barry Moskowitz granting defendants’ motion to stay the case pending reexamination of patent no. 4,935,184.  This is the same plaintiff, patent, judge, and subject as on appeal in 2010-1142.  Defendant in the 2010-1142 action have moved to dismiss the appeal for lack of jurisdiction, but no decision as of yet.

Stay: Orders granting motions to stay pending reexamination are not generally considered “final” and are therefore not generally appealable.  See, e.g., Gould v. Control Laser Corp., 705 F.2d 1340 (Fed. Cir. 1983); Soliami v. Kennametal, 2008-1345 (Fed. Cir. 2008).

However, an exception exists where the stay “effectively could put one of the appellants out of court” or if some “patent issue would escape review by a federal court if the case is stayed.”  See, e.g., Slip Track Sys., Inc. v. Metal Lite, Inc., 159 F.3d 1337, 1340 (Fed. Cir. 1998).  There is nothing in the record to indicate whether any facts supporting the exception exists here, so the appeal may not stick around.

Dismissing/Striking Counterclaims: Before staying the case the Court did grant Sorensen’s motion to dismiss Spectrum’s counterclaims and to strike affirmative defenses on invalidity.  On the counterclaim, the Court used the standard from Ashcroft v. Iqbal, — U.S. –, 129 S.Ct. 1937 (2009) to find the allegations insufficient to state a claim:

Here, Count II of Defendant’s counterclaim is nearly devoid of factual assertions. Defendant only alleges that “[t]he claim of the ‘184 patent are invalid under 35 U.S.C. §§ 101, 102, 103, and/or 112.” This threadbare statement is precisely the type of allegation that is insufficient to state a claim under the Iqbal standard. Accordingly, Count II of Defendant’s counterclaim is DISMISSED without prejudice.

Order, p. 2.  For the motion to strike, the Court applied a similar standard to reach the same result:

Under Rule 8 of the Federal Rules of Civil Procedure, an affirmative defense must be pled with the minimal specificity to give the plaintiff “fair notice” of the defense. Wyshak v. City Nat’l Bank, 607 F.2d 824, 827 (9th Cir. 1979). Here, Defendant’s Affirmative Defense D merely states, “One or more claims of the ‘184 patent are invalid for failure to comply with the conditions of patentability set forth in title 35 of the United States Code, including §§ 101, 102, 103 and/or 112.” Sections 101, 102, 103, and 112 provide several grounds for finding a patent invalid, and Defendant has failed to give Plaintiff fair notice of the basis of its affirmative defense.  Advanced Cardiovascular Syss., Inc. v. Medtronic, Inc., No. C-96-0942, 1996 WL 467273, at *3 (July 24, 1996). Accordingly, Plaintiff’s motion to strike is GRANTED, and the Court strikes Affirmative Defense D from Defendant’s answer without prejudice.

Id. Although these ruling are not on appeal, it is further evidence of what appears to be a trend around the country against accused infringers simply alleging invalidity without any factual allegations in support.  This shouldn’t be a big deal, however, if scheduling orders give some time for discovery and prior art searching before invalidity contentions are due and pleadings closed.

2010-1155 Order on Motion to Stay

2010-1130 Inventorprise v. Target

Inventorprise appeals from the order of Judge Thomas McAvoy dismissing for lack of subject matter jurisdiction its complaint against Target for false marking under 35 U.S.C. § 292. 

Although it sounds to me more like an issue under 12(b)(6) for failure to state a claim, the court found it lacked subject matter jurisdiction to hear the case because there was no colorable § 292 claim alleged against Target.

35 U.S.C. § 292 prohibits the false marking of a unpatented article so as to deceive the public into thinking it is patented:

Whoever marks upon, or affixes to, or uses in advertising in connection with any unpatented article, the word “patent” or any word or number importing that the same is patented for the purpose of deceiving the public shall be fined not more than $ 500 for every such offense.

Target, however, apparently only sold the "Closet Cedar Storage Accessories Set," and did not mark, affix, advertise or package the product–that all was done by Cedar Fresh Home Products, LLC, a non-party to the action.

The court summarized the relevant law as follows:

To state a claim under 35 U.S.C. § 292(a) against a party that has had no role in the actual marking of a product, a plaintiff must show that the defendant (1) used the word “patent” (or any word or number importing that the product is patented) “in  advertising in connection with any unpatented article;” and (2) acted with the intent to deceive the public.  35 U.S.C. § 292(a); see Clontech Labs., Inc. v. Invitrogen Corp., 406 F.3d 1347, 1352 (Fed. Cir. 2005); Chamilia, LLC v. Pandora Jewelry, LLC, 2007 U.S. Dist. LEXIS 71246, *29 (S.D.N.Y. Sept. 24, 2007); Max Impact, LLC., 2009 U.S. Dist. LEXIS 71013, at *2 – *3; see also Juniper Works v. Shipley, 2009 U.S. Dist. LEXIS 40978, at *7 (N.D. Cal. May 14, 2009).

Order, p. 8.

The court went on to conclude that the marking on the product itself does not constitute "advertising" (at least where the marking is on the back of the packaging and not normally visible to potential customers while strolling the aisles).  The court further noted that there were insufficient allegations to support an intent to deceive.  The court concluded:

First, there is no allegation that Target used the false mark in advertising with the intent to deceive the public. Second, assuming arguendo that the mark was used in advertising, there are insufficient allegations that Target acted with the requisite intent to deceive the public. Unlike the cases where a party mis-marks an item and then claims mistake or inadvertence, here there is no dispute that Target played no role in the marking of the Product. It is mere supposition to conclude that, because Target is a sophisticated corporation, it knew that the Product was not patented and that the patent number printed on back of the package belonged to another item. It is even more speculative to conclude that, because Target supposedly had this knowledge, it offered the Product for sale in the packaging provided by Cedar Fresh with the specific intent to deceive the public.

2010-1130 Marking Order

Kawasaki appeals from the order of Judge David Folson denying its FRCP 60(b)(3) motion to set aside a stipulated dismissal and to enforce the terms of a settlement agreement.  The dismissal was entered after the parties had resolved a patent infringement dispute and entered into a settlement agreement.

Judge Folsom concluded that the court lacked subject matter jurisdiction over the matter, which he characterized as purely a contract case in which Bombardier had allegedly breached the terms of the settlement by failing to have certain of its security agreements subordinated to the Kawasaki agreement.

The Court relied primarily on the Supreme Court’s decision in Kokkonen v. Guardian Life Ins. Co., 511 U.S. 375 (1994), which essentially held that where neither the parties’ stipulation nor the Court’s order of dismissal incorporated the settlement agreement (and where the Court did not expressly reserve jurisdiction over the settlement), any subsequent disagreement over its terms “is more than just a continuation or renewal of the dismissed suit, and hence requires its own basis for jurisdiction.” Id. at 378. 

Finding here that the Court neither incorporated the settlement terms into its order nor expressly retained jurisdiction, Judge Folsom denied the motion (after also noting the apparent inconsistency of seeking to both undue the dismissal for fraud (FRCP 60(b)(3)) and also to enforce the terms of the settlement.)

2008-1496 Saint Gobain v. Wang

Plaintiff Saint Gobain Ceramics & Plastics appeals from Judge F. Dennis Saylor’s dismissal of its claims regarding ownership of a pending patent application for lack of subject matter jurisdiction.

Wang was a former employee of Saint Gobain.  After leaving he went to defendant Planar Solutions where he filed a patent application with a co-inventor–allegedly on something that he invented, by himself, while at Saint Gobain.  Saint Gobain filed suit, alleging a various state law claims as well as claims to strike the co-inventor from the application.

Wang moved to dismiss the case, arguing that the district court did not have subject matter jurisdiction over a claim to change inventorship of a pending application.  The court summarized the patent laws on correcting inventorship:

The law generally requires that all joint inventors be listed on a patent application. See 35 U.S.C. § 116. Two federal statutes govern disputes as to patent inventorship. The first, 35 U.S.C. § 256, provides:

Whenever through error a person is named in an issued patent as the inventor, or through error is not named in an issued patent and such error arose without any deceptive intention on his part, [the PTO shall correct the error]. . . . The court before which such matter is called into question may order correction of the patent on notice and hearing of all parties concerned and [the PTO] shall issue a certificate accordingly.

Id. (emphasis added). This statute explicitly contemplates a role for the federal courts in hearing inventorship disputes concerning issued patents.

In contrast, 35 U.S.C. § 116 provides as follows:

Whenever through error a person in named in an application for patent as the inventor, or through error an inventor is not named in an application, and such error arose without any deceptive intention on his part, the [PTO] may permit the application to be amended accordingly, under such terms as he prescribes.

Id. (emphasis added). Notably, the latter statute does not mention the availability of judicial relief.

Thus, on their face  § 256 addresses "issued patents" while  § 116 covers "applications." 

The court noted a split in authorities–in Federal Circuit, regional circuit, and district court cases–as to whether  § 116 created a right of action in the courts.  Ultimately, however, the court found that while an inventorship dispute over an application "arose under the Patent laws," it did not state a cause of action for the federal courts:

The Court finds the view expressed in Simonton and Sagoma Plastics persuasive—that is, while the Court has subject-matter jurisdiction under § 1338(a) to hear a pending patent inventorship claim, § 116 does not provide a private right of action for such a claim. The standard for subject-matter jurisdiction under Christianson is whether “plaintiff’s right to relief necessarily depends on resolution of a substantial question of federal patent law, in that patent law is a necessary element of one of the well-pleaded claims.” Christianson, 486 U.S. at 808-809. This test is “lenient,” U.S. Valves, 212 F.3d at 1372, and the Court agrees with the authorities that have held a pending patent inventorship claim meets its requirements. See, e.g., Simonton, 2008 WL 901797 at *6; Concrete Washout Sys., 2005 WL 1683930 at *4; Sagoma Plastics, 366 F. Supp. 2d at 189; Heineken, 103 F. Supp. 2d at 478-80; Duke Univ., 2006 WL 267185 at *4; but see DuPont, 344 F.3d at 583-84.

The court likewise declined to change the inventorship on the pending PCT application, distinguishing Chou v. Univ. of Chicago because, in that case, the US patent had already issued and inventorship determined by the court under § 256.

This language [from Chou] clearly limits a district court’s ability to correct pending PCT inventorship claims to situations where a court has already determined the inventorship of an issued United States patent. Inventorship on PCT applications “normally follows the inventorship designation in the originating country.” Id. Because the inventorship designation on the United States patent at issue in this case has not yet been settled (and cannot be settled by this Court while the United States application is pending) the Court has no basis upon which to correct the pending PCT application.

The court then declined to exercise jurisdiction over the state law claims and dismissed.

More reading:

Opinion

Counsel:

Saint Gobain: Lowrie, Lando and Anastasi, LLP, Cambridge, MA (Matthew B. Lowrie, Thomas P. McNulty).

Wang: Dwyer & Collora LLP, Boston (Daniel J. Cloherty).

2008-1458 Icon Health v. Keys Fitness

Icon appeals from the order of Judge Tena Campbell dismissing the case for lack of subject matter jurisdiction.  The order followed Icon’s motion to enforce a settlement the parties apparently reached during the case, although the infringement claims were never dismissed or concluded. 

Icon sued Keys for patent infringement.  During the case the parties engaged in settlement discussions which resulted in a May 2007 Letter Agreement executed by officers of the parties.  This Letter Agreement spelled out, according to Icon’s motion, all of the essential terms of the settlement, including:

• Keys is to pay ICON a confidential amount for a non-exclusive, perpetual,
paid up license to make, have made, use, or sell any products or devices
falling within the scope of ICON’s United States Patent Nos. 4,842,266,
5,104,120, and 4,998,725;

• This confidential amount would be paid by Keys to ICON in installments,
interest free, with the first installment being due sixty (60) days from the
date of execution of the Letter Agreement;

• In the event that Keys is more than 10 days late in making any quarterly
installment payment, the entire unpaid balance shall be immediately due
and payable together with interest at the rate of 8% per year on the unpaid
balance;

• All claims pending in both in this Action and the Texas lawsuit are to be
dismissed with prejudice, and the parties shall mutually release each other
from all claims, known or unknown, relating to the subject matter of the
patent claims asserted in this Action and all claims alleged in the Texas
lawsuit, except those arising from breach of the Letter Agreement;

• ICON and Keys would enter into a formal settlement agreement
memorializing the terms contained in the Letter Agreement.

Following the letter agreement, dates from the case schedule were extended–however, no formal settlement agreement was ever executed.  Further, none of the parties filed any stipulation, consent judgment, notice, or other document of dismissal, and the action remained pending on the court’s active docket.  Keys ultimately refused to make any payments or take any other action consistent with the letter agreement.  (There is some suggestion that Key also may have filed for bankruptcy at some point after the letter agreement was signed).

In May 2008 Icon moved for an order to enforce the settlement agreement.  The court asked Icon to show that the court had jurisdiction to enforce the letter agreement–prompting Icon to file a brief on jurisdiction.  Despite this, the court found that it could not enforce the letter agreement and dismissed the entire action for lack of subject matter jurisdiction:

Because the court has not specifically retained subject matter jurisdiction within the settlement agreement itself and the settlement agreement is entirely a contractual issue under Utah State law, Plaintiff’s motion to enforce settlement agreement (dkt. # 39) is DENIED and the case is DISMISSED for lack of subject matter jurisdiction.

Note: The court seems to have concluded that the settlement agreement, if final and therefore capable of being "enforced," ended the patent case and thus also the court’s jurisdiction.  The court never could have "specifically retained subject matter jurisdiction within the settlement agreement itself"–settlement agreements are between private parties, not the court.  And the parties could not agree to have the court retain subject matter jurisdiction.  That language is in the court’s order of dismissal which, of course, was never entered or requested. 

I wonder if the year long delay between the agreement and the motion to enforce factored into the court’s decision–would a motion to enforce a month after the agreement have been met with the same dismissal?

More reading:

Order

Icon Brief on Jurisdiction

Motion to Enforce

Counsel:
Icon: Workman Nydegger, Salt Lake City (Larry Laycock, Sterling Brennan, Robyn Phillips).
Keys: Ray, Quinney & Nebeker, Salt Lake City (Mark Bettilyon).

2008-1444 PanaVise v. National Products

DJ plaintiff PanaVise Products appeals from the order of Judge Audrey Collins granting National’s 12(b)(1) motion for lack of an actual case or controversy.  The case involves National’s 6,666,420 patent and the parties’ products: competing suction cup mounting systems such as those used in automobiles for mobile phone holder, GPS units and the like. 

The court accepted National’s argument that its pre-suit activity did not rise to the level to create a declaratory judgment controversy under MedImmune and its progeny.

PanaVise, fearing that its new Model 811 suction cup would infringe the ’420 patent, filed a declaratory judgment action for noninfringement and invalidity.  Although National had made no direct statements or threats against it, PanaVise argued that there was an actual controversy based on National’s (1) prior statements that the ’420 is essential to all turn dial suction cup mounts for vehicles, and (2) history of vigorous enforcement of the ’420 (at least 6 cases and 12 entities).

Uncontested, however, was the fact that National had not made any specific statements about the 811 model–indeed, it had taken no action whatsoever with respect to the 811 and did not even know about the 811 model until the DJ action was filed.  The court wrote:

Plaintiff proffers no facts or evidence disputing Defendant’s averment that
there have been no pre-suit communications between the parties, that Defendant did not know of Plaintiff’s 811 series device before this suit was filed, and still has never even seen Plaintiff’s device, let alone examine it to determine whether it potentially infringes Defendant’s ‘420 patent.

After reviewing MedImmune and Sandisk, the court found that National’s lack of action specifically directed to the 811 model dispositive and the other activity insufficient to support jurisdiction:

Having reviewed the case law, it is clear that no case or controversy can exist in a patent action for declaratory relief in the absence of an act by the defendant. For example, in Sandisk, the court stated that “declaratory judgment jurisdiction generally will not arise merely on the basis that a party learns of the existence of a patent owned by another or even perceives such a patent to pose a risk of infringement, without some affirmative act by the patentee.” Sandisk, 480 F.3d at 1380-1381 (emphasis added). That is exactly the situation here: Plaintiff merely learned that Defendant owns a patent and is concerned that its own device may infringe Defendant’s patent, but Defendant has taken no affirmative act in relation to Plaintiff’s device; indeed, Defendant did not know of Plaintiff’s device and has yet to see it. Sandisk further states that “Article III jurisdiction may be met where the patentee takes a position that puts the declaratory judgment plaintiff in a position of either pursuing arguably illegal behavior or abandoning that which he claims a right to do,” id. (emphasis added), thereby reinforcing the notion that no case or controversy can exist where the defendant has taken no position. It is undisputed that Defendant has taken no position with respect to Plaintiff and/or the 811 series device.

That Defendant has sued other unrelated persons for infringement of the ‘420 patent does not constitute action toward this plaintiff and the 811 series device, and therefore does not contribute to the existence of a case or controversy between these parties Without Defendant even knowing about Plaintiff’s device, it is not apparent that the parties have “adverse legal interest[s]” and that the dispute is “definite and concrete.” Rather, Plaintiff is seeking what MedImmune forbids: “an opinion advising what the law would be upon a hypothetical state of facts.” MedImmune, 127 S.Ct. at 77. Indeed, the cases Plaintiff cites in support of its position all involve a defendant communicating with the plaintiff about plaintiff’s device. Plaintiff has directed the Court to no case in which a case or controversy was found in the absence of any act by the defendant directed toward the plaintiff and/or plaintiff’s device.

The absence of any communication or conduct by Defendant towards Plaintiff about the 811 series device is dispositive of the jurisdictional question: there is no actual case or controversy upon which the Court’s subject matter jurisdiction may rest.

Notes:  The allegations are similar to those in 2008-1373 Impax Labs v. Medicis Pharmaceutical, where a DJ was attempted based on the patentee’s history of public threats and litigation, although not specifically or explicitly directed at the DJ plaintiff.  At least to me, the case for jurisdiction seems stronger in Impax where the history of threats more readily implicate the DJ plaintiff and its product.

More reading:

Order

National’s Motion

PanaVise Opposition

Counsel:

PanaVise: The Walker Law Firm, Newport Beach (Joseph Walker, Allan Grant ,Jason Matthew Lamb).

National Products: Darby & Darby, Seattle (David K. Tellekson, Mark P. Walters) and Pfeiffer, Thigpen & FitzGibbon, Santa Monica (Thomas N. FitzGibbon)

2008-1418 Human Genome v. Immunex

Humane Genome (HGS) appeals from Judge Sue Robinson’s order dismissing the complaint for lack of subject matter jurisidiction.  Although not a patent infringement action (and therefore not the usual PATracer fare), the case derives from an interference proceeding before the BPAI and an interesting decision from a judge that hears a lot of patent cases.

Unhappy with the preliminary rulings against it during the interference–rulings which HGS believed precluded it from prevailing in the interference–HGS attempted to simply concede the issue solely for the purpose of appealing to the district court under 35 U.S.C. § 146.  A practice, it argued, that is conceptually similar to a patentee conceding non-infringement so as to appeal an adverse claim construction ruling.  While HGS successfully conceded the issue and lost the interference, the district court dismissed the appeal finding that such concessions failed to give the district court subject matter jurisdiction.

An interference was declared between HGS’s 6,872,568 patent (to Ni) and Immunex’s 09/378,045 application.  While the ’045 application was filed first, the ’568 patent claimed priority to several earlier applications.  During the preliminary motions phase Immunex was given the benefit of an earlier, 1997, application, but HGS was denied the benefit of any of the earlier applications, leaving it with a May 2000 priority date.

After redeclaring the interference, the proceeding moved to the priority phase in which the Board would receive evidence, testimony and decide the ultimate issue of priority of inventorship.  HGS, however, filed with the Board a request for an adverse judgment in order to proceed immediately to appeal under § 146.  HGS stated:

HGS concedes that based on the Board’s decisions on motions the Board will enter judgment adverse to HGS on priority. In its request for adverse judgment, HGS was merely noting that it reserves its rights concerning the decisions on motions and the priority issues that would result from any modification thereof.

The priority issue that was subject to ongoing briefing here is different from the priority issues that would result if HGS’s challenges to the decisions on motions succeed in the action under 35 U.S.C. § 146. For example, as a result of the decisions on motions, HGS is the junior party with a constructive reduction to practice date that follows Immunex’s constructive reduction to practice date by more than three years …. If the decisions on motions are altered, HGS reserves its rights to prove priority in a differently defined priority contest.

After some back and forth in which the Board demanded that HGS proceed, the Board entered an order to show cause and entered judgment against HGS on the priority and canceled certain claims of the ’568.

HGS then appealed to the district court, which granted Immunex’s motion to dismiss.  Reviewing the interference process and its purpose, the court decided that HGS’s actions denied the Board an opportunity to determine the issue in the first instance:

In this regard, it is clear that the fundamental purpose of interference proceedings is to give the Board a full and fair opportunity to determine priority. It is evident from the record that HGS presented to the Board little more than conclusory arguments. Indeed, HGS failed to provide even enough information to allow the Board to specifically define the scope of the dispute. If the court were to allow HGS’ § 146 appeal to go forward on this record, it would constitute an effective usurpation of the Board’s original jurisdiction to determine priority. Moreover, HGS’ failure to adequately develop the record leaves too much room for mischief in a § 146 appeal, where supplemental discovery can be taken and new evidence proffered to the court.  Although the court is mindful that there is room for debate on these issues and that HGS may not have any administrative recourse if the appeal is dismissed, nevertheless, the court concludes that HGS has not carried its burden to prove that the court has subject matter jurisdiction under 35 U.S.C. § 146.

In reaching this conclusion, the court somewhat distinguished Rasmussen v. Smithkline Beechem, 413 F.3d 1318 (Fed. Cir. 2005), in which the Federal Circuit reviewed the Board’s decision following one party’s request for an adverse judgment.  There, the Board’s decision was appealed directly to the CAFC under 35 U.S.C. §§ 141-144 and was based entirely on the record before the Board.  Here, in appeals to the district court, additional evidence and material may be considered by the court beyond what was before the Board.

Note:

Judge Robinson was clearly concerned with the fact that HGS, in her view, didn’t really put the effort into trying the matter to the BPAI.  She quoted liberally from BPAI orders and decisions also critical of this effort, such as:

In other words, the Board did not afford HGS the benefit of any of its earlier filed applications in the chain because HGS did not sufficiently connect the disclosure of the ’568 patent, filed as a continuation-in-part application, to that of the applications preceding it. More specifically, in its July 26, 2007 decision, the Board explained that:

"[i]t is not the job of the Board to pour through hundreds of pages of text and sheets of drawings to find disclosure alleged to be "at least the same disclosure as is found in the March 17 and July 29, 1997 priority applications." See United States v. Dunkel, 927 F.2d 955, 956 (7th Cir. 1991) ("Judges are not like pigs hunting for truffles buried in briefs"). It is not the fact finder’s burden to search through lengthy technology-intense documents for possible evidence which may support Ni’s "at least the same reasons."

More reading:

Order

Counsel:

HGS: Steven J. Balick, John G. Day, and Lauren E. Maguire of Ashby & Geddes, Wilmington, Delaware; Richard L. DeLucia, John R. Kenny, and A. Antony Pfeffer of Kenyon & Kenyon LLP, New York, New York.

Immunex: Melanie K. Sharp and Chad S. C. Stover of Young Conaway Stargatt & Taylor, LLP, Wilmington, Delaware; Michael J. Wise and Lauren Sliger of Perkins Coie LLP, Santa Monica, California.

2008-1414 SB Pharmco v. Mutual Pharmaceutical

Defendant Mutual appeals from the grant by Judge R. Barclay Surrick of Judgment on the Pleadings, finding that Mutual’s December 21, 2007 ANDA Paragraph IV Notice to SB d/b/a Glaxosmithkline (GSK) was premature and did not trigger the 45-day period to file a lawsuit under 21 U.S.C. § 355(b)(5)(B)(iii).  Case dismissed.

GSK owns 7,268,156 directed to compositions and treatment methods for carvedilol phosphate salts or solvates, which it sells as COREG CR®, an extended release formulation for treating hypertension, myocardial infarction and heart failure.  The ’156 is listed in the Orange Book.  Mutual filed an ANDA on November 19, 2007, and an amendment with Paragraph IV certification on December 21, 2007, sending GSK notice on that later date.  However, the FDA did not acknowledge the ANDA until March 17, 2008.  The question before the court was whether Mutual’s notice was timely or premature.

ANDA Overview.  Under Hatch-Waxman Act, a company seeking to market a generic version of a drug may file an Abbreviated New Drug Application (ANDA), relying on the clinic studies performed by the pioneer drug manufacturer.  It need not prove the safety and effectiveness of the proposed generic so long as it can show it is bioequivalent to the drug for which it will serve as a substitute. 

In addition, the applicant must certify that the generic will not infringe any of the patents listed in the Orange Book for that drug.  One type of certification is Paragraph IV, stating that the patent is invalid or will not be infringed by the generic for which the applicant seeks approval.  See 21 U.S.C. § 355(j)(2)(A)(vii)(I-IV).

The applicant must serve the patentee with notice of the Paragraph IV certification, following which the patentee has 45-days to file an action for patent infringement.  If the patentee files a suit, the ANDA cannot be approved until the earlier of the patent being held invalid or not infringed, or 30-months.

Timing of Notice.  Mutual served GSK with notice of its Paragraph IV certification on the same day it filed its ANDA amendment–and before the FDA had deemed the ANDA received.  Over the next several weeks, GSK requested Mutual to withdraw the notice as premature–when Mutual refused, GSK (on the 45th day) filed a declaratory judgment action for determination that the notice was premature–and asserting a claim for patent infringement "just in case."

21 U.S.C. § 355(j)(2)(B)(ii) states, in pertinent part: 

Timing of notice.—

An applicant that makes a certification described in subparagraph
(A)(vii)(IV) shall give notice as required under this subparagraph—

(I)
if the certification is in the application, not later than 20 days
after the date of the postmark on the notice with which the Secretary
informs the applicant that the application has been filed….

The FDA has promulgated regulations that provide that it has "received" an ANDA and will send notice of receipt only after it has preliminarily determined that it is sufficiently complete to permit substantive review.  21 C.F.R. § 314.101(b)(1) and § 314.95(b).

The FDA’s position–and that of GSK–is that the "notice" to trigger the 45 day statutory period can not be sent until after Mutual received the filing notice from the FDA.  Mutual argued that the statute only provided the latest the notice could be sent, claiming that the notice could be sent any time after the filing of the ANDA and before the expiration of 20 days after the FDA confirmation.  The issue is whether the trigger is the act of submitting or the receipt of the submission, the latter being defined by the FDA pursuant to regulation.

The court agreed with GSK and the FDA.  Reviewing the entire purpose of Hatch-Waxman, the court found that having the FDA first confirm a substantially complete filing before allowing an effective notice to be sent avoided unnecessary patent infringement litigation over incomplete ANDAs.  Also, it prevented entities from purposefully filing incomplete or sham ANDAs simply to become the first ANDA filer (and thereby possibly gaining the 180 day exclusivity). 

The court also rejected Mutual’s argument that the notice was timely–and indeed required–under § 355(j)(2)(B)(ii)(II) regarding ANDA amendments:

(II) if the certification is in an amendment
or supplement to the application, at the time at which the applicant
submits the amendment or supplement, regardless of whether the
applicant has already given notice with respect to another such
certification contained in the application or in an amendment or
supplement to the application.

Mutual’s certification was filed with an amendment to the ANDA.  Although the statute explicitly states that the notice must be sent "at the time . . . the applicant submits the amendment"–the court held that this provision assumed that the initial application had been "received" (i.e., "accepted") by the FDA. 

Finally, the court rejected Mutual’s argument that the case should proceed because GSK sued it for patent infringement upon the filing of the ANDA–thus, GSK’s "backup infringement claim" provides jurisdiction to the court to hear the case.  Again, the court found that no "case or controversy" existed at the time the case was filed–under either a DJ or infringement theory:

In this case, there was no actual or substantial controversy at the time that Plaintiffs’ filed their Complaint. Plaintiffs’ claim of patent infringement was based upon service of an invalid Paragraph IV notice for an amendment to an ANDA that had not yet been received by the FDA.  During the preliminary review stage, ANDA 90-132 could not have been approved by the FDA. Under the circumstances, Defendants’ ANDA could not cause an injury-in-fact to Plaintiffs. It was potentially incomplete and could not constitute an act of infringement. Under the statute and the case law, we conclude that Defendants’ delivery of the ANDA to the FDA did not create the actual or imminent controversy necessary to satisfy the Declaratory Judgment Act.

Notes:  On March 17, 2008, following FDA acceptance of the ANDA, Mutual sent another paragraph IV notice.  I could not find a new lawsuit on PACER by SB/GSK on against Mutual.

More reading:

Opinion

Counsel:

SB/GSK: Wilmer Cutler Pickering Hale & Dorr (Amy K. Wigmore, Jasmine S. Mcghee, Mark L. Rienzi, William F. Lee, William G. Mcelwain) and Dechert (Joseph R. Heffern, Kevin M. Flannery, Martin J. Black).

Mutual: Curtis, Mallett-Prevost, Colt & Mosle (Eliot Lauer, Jacques Semmelman, Rachael Yocum), Dilworth Paxson (James J. Rodgers) and Cantor Colburn (Leah M. Reimer, Leslie-Anne Maxwell, Steven M. Coyle).

2008-1387 R.M.F. Global v. Cattan

Declaratory judgment plaintiff Innovative Designs appeals from Judge Arthur Schwab’s order confirming the Italian Arbitration Association’s ("IAA" or, when in Italy, "AIA") award to Eliotex/Cattan of approximately $4.1 million plus over €200,000 in arbitration and attorney’s fees.

Plaintiffs were the exclusive agents for defendants with rights to defendants’ patent, 6,083,999, and trademark, ELIOTEX, for a lightweight, insulated material for performance athletic wear, etc.  A dispute arose, and plaintiffs filed an April 2004 action seeking a declaration that (i) they did not infringe the ’999 patent; (ii) the ’999 patent was invalid and unenforceable; and (iii) they did not infringe on the Eliotex trademark.  They also asked the court for damages and to enjoin Cattan from interfering with their business and contractual relations and from engaging in unfair competition.

Shortly thereafter, and on Cattan’s motion, the court stayed the case based on an arbitration clause in the "exclusive agency, distribution and marketing agreement" between the parties:

In the event of a dispute between the parties as to the terms and conditions of this Agreement, and in the event that such dispute does not prove susceptible to amicable resolution, the parties hereto agree to accept binding arbitration in accordance with the rules of the Italian Arbitration Association in order to promptly and efficiently effectuate a resolution of said dispute.

Although the court believed that the patent and trademark claims were likely not within the scope of the arbitration clause, the tortuous interference and unfair competitions claims were covered.  Because at least 1 claim was covered, the Federal Arbitration Act, 9 U.S.C. § 1-14 required the judicial action be stayed pending the arbitration.

The IAA proceedings then commenced, but–and for reasons not set forth in the record–R.M.F. and Innovative Designs decided not to participate.  The IAA ultimately awarded Cattan/Eliotex over $4.1 million plus fees.

Cattan returned to district court to confirm the award and enter judgment, but Innovative Designs opposed, arguing:

1. they were denied meaningful participation in the IAA proceedings because they received insufficient notice;
2. Cattan’s motion to "confirm" the arbitration clause was not procedurally correct;
3. there were irregularities in the IAA proceedings;
4. that agreement to arbitrate was invalid; and
5. enforcement of the award is contrary to U.S. public policy.

The court easily rejected all of these arguments, applying the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of June 10, 1959 (see 9 U.S.C. § 201-208).  First, Innovative Designs plainly knew about the appointment of the arbitrator in Italy and the proceedings–indeed, it referenced notices for such in 2004 court filings.  The court concluded:

it is simply incredible for plaintiffs to claim that they did not have notice of the [IAA] Proceedings, in the face of the overwhelming record evidence to the contrary.  [Emphasis in original]

The court also rejected the "confirm v. compel" argument.  While noting that such motions were normally labeled to "compel" arbitration, the motion was clearly a timely request to arbitrate the matter under the parties’ agreement.

The court also rejected challenges to the agreement, noting that the validity of an agreement containing an arbitration clause was a matter for the arbitrator to decide (citing Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440, 126 S.Ct. 1204 (2006)).  Lastly, the court held that the award did not violate public policy. 

The court concluded:

Plaintiffs were undoubtedly aware of the IAA Proceedings, and had every
opportunity to participate in those Proceedings. They chose not to participate, and now they must accept the consequences of that choice. This Court will not now disregard the Award entered in the IAA Proceedings or reward plaintiffs’ refusal to litigate in the forum in which they were contractually bound to litigate. For the foregoing reasons, the Court will grant defendants’ motion to confirm the arbitration award (Document No. 35).

Notes and Comments: The appeal on the order to confirm the IAA award was filed in 2006 with the Third Circuit (Case No. 2006-2203).  Although it took awhile, the Third Circuit ordered the appeal transferred to the Federal Circuit on 08 May 2008.

More reading:

Order Confirming IAA Award