Patent Case Summaries April 17, 2024

Patent Case Summaries | Week Ending April 12, 2024

Salix Pharmaceuticals, Ltd., et al. v. Norwich Pharmaceuticals Inc., Nos. 2022-2153, 2023-1952 (Fed. Cir. (D. Del.) Apr. 11, 2024). Opinion by Lourie, joined by Chen. Opinion dissenting-in-part by Cunningham.

Norwich filed an Abbreviated New Drug Application (ANDA) for tablets with the same indications as the active ingredient in Salix’s commercial products, certifying that Salix’s patents on the ingredient were invalid. Salix timely sued, asserting that Norwich’s ANDA infringed the patents. Following a bench trial, the district court held that Norwich infringed patents directed to treating hepatic encephalopathy (“HE” patents) and that Norwich had failed to establish invalidity of the asserted claims. The district court also held that Norwich’s ANDA infringed certain other patents (“IBS-D” patents and “polymorph” patents) but ruled that the claims were invalid as obvious over the prior art.

As part of the judgment, the district court ordered that the effective date of a final approval of Norwich’s ANDA should not precede the latest expiration date associated with the infringed HE patents. Norwich then amended its ANDA to remove the infringing HE indication and moved to modify the judgment under Federal Rule of Civil Procedure 60(b), asserting that the amendment negated any possible infringement, but the district court denied the motion.

The parties cross-appealed, with Salix challenging the invalidity holdings and Norwich challenging both the ruling on the final approval of its ANDA and the denial of its motion under Rule 60(b). The Federal Circuit affirmed on all issues.

As to the obviousness of the IBS-D patents, the Federal Circuit held that the district court did not err in determining that a skilled artisan would have had a reasonable expectation of success in using the claimed dosage to treat IBS-D based on the disclosures in the prior art. As to the polymorph patents, the court held that the district court did not clearly err in determining that there would have been a reasonable expectation of success in obtaining the form of the substance recited in the claims.

Turning to Norwich’s appeal, the Federal Circuit held that the district court did not err in ordering that the final approval of Norwich’s ANDA could not be effective before the HE patents expired, even though Norwich’s ANDA also sought approval of a noninfringing indication. The fact that the ANDA recited a non-patent-protected indication did not negate the infringement resulting from the ANDA’s submission. Therefore, the district court appropriately delayed the final approval date.

Finally, the Federal Circuit held that the district court did not err in denying Norwich’s motion under Rule 60(b) to modify the judgment following Norwich’s modification of the ANDA. The district court did not abuse its discretion in finding that simply asserting that a patented indication has been carved out of an ANDA does not necessarily satisfy the judgment or entitle the applicant to direct entry into the market.

Judge Cunningham dissented in part. In her view, the Federal Circuit should vacate the district court’s judgment that the asserted claims of the IBS-D patents are obvious. According to Judge Cunningham, under a clear error standard, a person of ordinary skill would not have had a reasonable expectation of success for the claimed dosage. She explained that the majority erroneously relied on certain references and failed to tie the reasonable expectation of success to the claimed dosage.

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Luv N’ Care, Ltd., et al. v. Laurain, et al., Nos. 2022-1905, -1970 (Fed. Cir. (W.D. La.) Apr. 12, 2024). Opinion by Stark, joined by Reyna and Hughes.

Luv n’ care, Ltd. and Nouri Hakim (“LNC”) filed a complaint against Lindsey Laurain and Eazy-PZ, LLC (“EZPZ”) seeking a declaratory judgment that certain EZPZ design and utility patents relating to dining mats for toddlers are invalid, unenforceable, and not infringed. EZPZ counterclaimed for infringement.

During the litigation, the district court granted LNC’s motion for partial summary judgment that the claims of one of EZPZ’s patents are invalid as obvious. After a bench trial, the court held that LNC did not prove one of EZPZ’s patents unenforceable due to inequitable conduct. The court also ruled that EZPZ was barred from obtaining relief due to its “unclean hands.” The court then denied LNC’s motion to recover its attorneys’ fees and costs. Both parties appealed.

Addressing four issues raised by the parties, the Federal Circuit affirmed in part, vacated in part, and remanded.

First, the Federal Circuit affirmed the finding that the doctrine of unclean hands bars EZPZ from obtaining its requested relief. The district court had thoroughly analyzed EZPZ’s misconduct and there was no clear error in the court’s determination that EZPZ’s misconduct bore an immediate and necessary connection to EZPZ’s claims for infringement as well as issues of claim construction, invalidity, and unenforceability. The Federal Circuit also found no clear error in the district court’s determination that EZPZ’s misconduct as to one patent could not be separated from its conduct as to other claims.

Next, the Federal Circuit vacated the district court’s order that LNC had not met its burden to prove inequitable conduct. The Federal Circuit could not discern from the district court’s opinion whether it had made findings on affirmative egregious misconduct and per se materiality. The Federal Circuit also held that the district court failed to apply the correct standard for deceptive intent by not addressing the collective weight of the evidence on EZPZ’s misconduct as a whole.

Next, the Federal Circuit vacated the finding that certain claims were invalid as obvious. The Federal Circuit determined there were genuine disputes of material fact over whether the prior art disclosed the claimed self-sealing functionality. The court determined that more analysis may be necessary on the issue of motivation to combine and that there are genuine disputes of material fact about objective indicia of nonobviousness.

Finally, the Federal Circuit vacated the denial of LNC’s request for attorneys’ fees and costs. The court held that LNC is the “prevailing party” for purposes of the attorneys’ fees statute because LNC successfully achieved a material alteration in its legal relationship with EZPZ by obtaining a ruling that one of EZPZ’s patents is unenforceable, even though LNC did not prevail on other claims. The Federal Circuit remanded for the district court to evaluate whether the case is exceptional and to reconsider the denial of costs.

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