November 2021 Federal Circuit Newsletter (Japanese)
November 2021 Federal Circuit Newsletter (Chinese)
Venue and Pleading Infringement in Hatch-Waxman Litigation Turn on Location and Identity of ANDA Filer
In Celgene Corp. v. Mylan Pharm. et al., Appeal No. 21-1154, the Federal Circuit held that in Hatch-Waxman litigation: (1) infringement occurs where the ANDA is submitted and not where the patentee receives notice of the ANDA submission; (2) the presence of an affiliated entity or employees in the district is insufficient to show a regular and established place of business; and (3) pleadings must explain how a defendant was involved in the ANDA submission to support a claim for infringement.
Mylan Pharmaceuticals Inc. (“MPI”) filed an Abbreviated New Drug Application (“ANDA”) for a generic version of Celgene’s pomalidomide drug. Celgene (residing in New Jersey) filed patent infringement actions in the District of New Jersey against MPI (residing in West Virginia), Mylan Inc. (residing in Pennsylvania), and Mylan N.V. (residing in Pennsylvania and the Netherlands) (collectively “Mylan”). Mylan moved to dismiss for improper venue as to MPI and Mylan Inc., and for failure to state a claim as to Mylan N.V. The district court agreed with Mylan regarding venue and dismissed the claims against Mylan N.V. because it did not submit the ANDA. Celgene appealed.
The Federal Circuit affirmed the dismissal of MPI and Mylan Inc. for improper venue. It was undisputed that neither entity resided in New Jersey. Thus, Celgene needed to prove that infringement occurred in New Jersey and that MPI and Mylan Inc. had regular and established places of business there. With respect to infringement, the Federal Circuit rejected Celgene’s argument that MPI’s ANDA submission (which did not occur in New Jersey) extended nationwide to future acts of marketing and sales. The Federal Circuit also rejected Celgene’s argument that receipt of notice of MPI’s ANDA filing at its headquarters in New Jersey constituted part of the infringing ANDA submission. Thus, no act of infringement occurred in New Jersey.
The Federal Circuit also affirmed the finding that MPI and Mylan Inc. did not have regular and established places of business in New Jersey. Celgene argued that several Mylan employees lived in New Jersey and rented storage lockers, but the court found this insufficient and noted that a physical location must be “of the defendant, not solely . . . of the defendant’s employee.” Alternatively, Celgene argued that Mylan Labs. Inc., a defunct, indirect subsidiary of MPI, once had an office in New Jersey that should be imputed to MPI and Mylan Inc. for venue purposes. The Federal Circuit disagreed because Celgene failed to establish any disregard of corporate formalities or separateness that would allow the subsidiary’s venue to be imputed to its parent.
Lastly, the Federal Circuit affirmed the dismissal as to Mylan N.V. for failure to state a claim. It was undisputed that MPI was the entity that signed and submitted the ANDA to the FDA. The Federal Circuit rejected Celgene’s argument that the chain of ownership from Mylan N.V. to MPI was sufficient to state a claim against Mylan N.V. based on MPI’s ANDA submission. Celgene also alleged that the entities acted in concert and that Mylan N.V. directed and controlled MPI. However, the Federal Circuit found these statements to be mere legal conclusions, lacking allegations or evidence, for example, as to how Mylan N.V. was involved in the ANDA process or how Mylan N.V. controls or directs MPI.
No Standing for Second Bite at the Apple
In Apple, Inc. v. Qualcomm, Inc., Appeal No. 20-1683, the Federal Circuit held that Apple lacked standing to appeal an IPR decision upholding patents that Apple licensed from Qualcomm, in light of a prior decision with identical operative facts.
Qualcomm sued Apple for infringement of various Qualcomm patents. In response, Apple petitioned for inter partes review (IPR) of Qualcomm’s patents. The Patent Trial and Appeal Board issued four final written decisions holding Apple did not prove the challenged claims in the patents would have been obvious. Apple and Qualcomm then settled all litigation between the two companies worldwide. The settlement included a six-year license agreement for a large portfolio of patents, including the patents at issue. Apple then appealed the Board’s four final written decisions. In April of 2021, the Federal Circuit found that Apple failed to establish standing to appeal the first of the four final written decisions. First, the Federal Circuit rejected Apple’s argument that its payment of royalties under the licensing agreement confers standing, reasoning that the validity of the patents would not impact Apple’s royalty obligations. Second, the Federal Circuit rejected Apple’s assertion of standing based on the possibility that Qualcomm might sue Apple for infringing the patents after the license expires, finding Apple’s assertions lacked the specificity necessary to show that Qualcomm was likely to assert the patents after the expiration of the license agreement. Third, the Federal Circuit rejected the contention that the harm Apple could face from IPR estoppel confers standing, noting Apple failed to show it will likely be engaging in activities that could give rise to a lawsuit based on the patents. Accordingly, the Federal Circuit dismissed the first appeal.
In appealing the second final written decision, Apple asserted that the Federal Circuit’s dismissal of the first appeal did not explain why the threat of liability if Apple ceased licensing payments was insufficient for standing. The Federal Circuit concluded that, while the patent at issue in the first appeal was different from the patent at issue in the second appeal, the settlement and the license agreement covered both patents. Additionally, the Federal Circuit concluded that Apple’s declarations in support of standing in the second appeal were the same as Apple’s declaration in support of standing in the first appeal. The Federal Circuit concluded that the two “cases are on all fours” and “the writing is already on the wall.” The Federal Circuit explained that, where there is a case on point, the Federal Circuit is bound by stare decisis. Because the Federal Circuit concluded that the operative facts of the first appeal were the same as the operative facts of the second appeal, it was bound by the decision in the first appeal. The court therefore dismissed Apple’s second appeal for lack of standing.
Judge Newman dissented, arguing that, because the first appeal and the second appeal presented different issues, different arguments, and different technologic aspects of the devices, and because of Apple’s status as a patent licensee, it was “apparent” that Apple had standing to pursue the current appeal
Lack of Written-Description Support for Claimed Ranges Makes Parent Application Prior Art
In Indivior UK Limited v. Dr. Reddy’s Laboratories S.A., Appeal No. 20-2073, the Federal Circuit held that claims of a continuation application were anticipated because they were not entitled to the filing date of a parent application that failed to support the ranges of numerical values claimed in the continuation.
Dr. Reddy’s Laboratories petitioned for inter partes review (IPR) of Indivior’s patent claims. The Board held that the challenged claims, which issued from a continuation application, were not entitled to the filing date of a parent application. According to the Board, the parent application lacked written-description support for numerical ranges recited in the challenged claims, and therefore the parent application was prior art. Because the parent application disclosed values within the claimed ranges, the Board held that it anticipated the challenged claims. Indivior appealed.
The Federal Circuit found substantial evidence for the Board’s factual findings concerning the lack of written-description support. Although some of the claimed ranges could be derived mathematically from certain entries in a table in the parent application, the Federal Circuit held that this table was insufficient to support the claimed ranges.
Judge Linn dissented, arguing that the majority ignored two precedential cases showing that the parent application provided adequate support for the claimed ranges.
Written Description: What is the Proper “Dosage” to Satisfy This Requirement?
In Biogen International GMBH v. Mylan Pharmaceuticals Inc. Appeal No. 20-1933, the Federal Circuit held that a specification may not demonstrate “possession” of an invention in satisfaction of the § 112 written description requirement even though the specification lists dosage ranges encompassing the claimed limitation.
Biogen sued Mylan for infringement of a patent directed to a method of treating multiple sclerosis (MS) with dimethyl fumarate (DMF). Mylan counterclaimed asserting invalidity and non-infringement. Claim 1 recited inter alia “wherein the therapeutically effective amount of [DMF]… is about 480 [milligrams] per day [DMF480].” The patent specification recited inter alia “an effective dose of DMF… can be… from about 240 mg to about 720 mg per day; or from about 480 mg to about 720 mg per day; or about 720 mg per day.” The district court found the asserted claims to be invalid for lack of written description because the specification failed to describe that the inventors possessed the claimed therapeutically effective dose of DMF to treat MS. Biogen appealed.
The Federal Circuit affirmed invalidity based on a lack of written description. First, the specification’s reference to DMF480 was part of a wide dosage range. Specifically, DMF480 appeared in only a single range among multiple ranges and appeared at the end of that range. The Federal Circuit contrasted this with the specification’s reference to DMF720 independently as a therapeutically efficacious dose. Despite the wide range of potential doses, Biogen argued that a skilled artisan would be drawn to the DMF480 dose because it was “anchored” to the DMF720 dose, which was known at the time to be effective. However, the Federal Circuit noted that the specification also “anchored” other doses to DMF720 that were known to be ineffective (e.g., DMF240) as well as doses that would far exceed therapeutic efficacy (e.g., DMF1,000). The Federal Circuit further noted that one of the inventors stated that his research was not focused on informing the clinical dosing of DMF and “denied that his research could be extrapolated to a clinical dose of DMF.” Moreover, Biogen’s expert conceded that the sole DMF-dosage paragraphs in the specification did not teach a person of ordinary skill in the art that DMF480 would be therapeutically effective for treating MS. Finally, the Federal Circuit noted that the patent specification included only the single paragraph teaching potential DMF dosage levels and that this paragraph was not linked to the treatment of any specific disease (e.g., MS).
Judge O’Malley dissented, arguing that the district court erred in applying judicial estoppel to prevent Biogen from arguing a distinction between the clinical and therapeutics effects of DMF480. Judge O’Malley asserted that this error led to a fundamental misunderstanding of what was claimed and impacted the district court’s obviousness and written-description analyses.
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