You Don't Know What You've Got

It’s frustrating when someone doesn’t follow the litigation rules! B-Tek got a taste of this frustration first hand in a patent infringement suit involving technology used in the truck weighing stations we see on the side of interstate highways. But it’s even more frustrating when the violator only gets a slap on the wrist.

Why? Well, we can’t sanction all rule violations. Usually courts only sanction the ones that make a difference in the case—the ones that prejudice the other party.

Mettler-Toledo, Inc. v. B-Tek Scales, LLC, Nos. 2011-1173, -1200 (Fed. Cir. Feb. 8, 2012) (Judges Bryson, Moore, and Reyna)

Mettler sued B-Tek for infringement of two patents that relate to technology for weighing large objects, including commercial trucks. These patents contain a number of means-plus-function claims—claims that automatically include the “structures” described in the specification that can perform the claimed function. The jury concluded that B-Tek doesn’t infringe one of the patents and that the second patent is both invalid and not infringed. On appeal, the Federal Circuit affirmed.

But the patent issues aren’t the interesting part of this opinion.

A Slap on the Wrist

B-Tek also appealed the district court’s denial of sanctions for alleged discovery abuses by Mettler. Evidently, Mettler asked for lost profit damages and B-Tek requested relevant documents related to Mettler’s manufacturing capacity in response. Mettler denied having these documents until a Mettler employee admitted at trial that some of them do exist, or did, but were destroyed. Mettler even provided some of these documents to its own damages expert when preparing the case, which demonstrated that it also considered them relevant to the damages issue.

B-Tek was furious when it found out that these documents had not been turned over and that some of them had been destroyed. It asked the trial court to award sanctions for this discovery violation and to award it attorneys’ fees.

Despite this evidence of destruction and failure to turn over relevant information, the trial court denied B-Tek’s motion. It noted that Mettler didn’t hide the documents—a Mettler employee actually mentioned them during a deposition. The trial court then concluded that they weren’t particularly relevant. Also, the court noted that B-Tek prevailed at trial on the liability issues, which made the damages issue moot.

So B-Tek couldn’t convince the trial judge that it was prejudiced by Mettler’s failure to turn this information over during the discovery period. The Federal Circuit agreed with the trial court’s decision to deny sanctions given the lack of evidence that B-Tek was harmed.

If you would like to read the Mettler opinion, you can find it here.

Off-Label Prescriptions: Not a Patent Infringement Problem

AstraZeneca Pharmaceuticals LP v. Apotex Corp., Nos. 2011-1182, -1183, -1184, -1185, -1186, -1187, -1188, -1189, -1190 (Fed. Cir. Feb. 9, 2011) (Chief Judge Rader, Circuit Judges Lourie and Moore)

AstraZeneca and The Brigham and Women’s Hospital, Inc. (collectively “AZ”) appealed from a number of litigations involving 11 generic companies. The U.S. District Court in Delaware had dismissed AZ’s claims, which involved 2 method of use patents. In a series of suits, AZ sued generic companies on 3 patents covering its blockbuster cholesterol-lower drug CRESTOR, which reduces the amount of cholesterol that circulates in vessels by inhibiting an enzyme involved in the body’s process for manufacturing cholesterol.

AZ’s 3 patents cover the active pharmaceutical ingredient in CRESTOR, rosuvastatin. One patent, the ’314 patent, covers the ingredients composition; one claims a method of using CRESTOR to treat a genetic cholesterol condition; and the third claims a method of using CRESTOR to treat elevated protein levels associated with cardiovascular disorders. AZ listed these 3 patents, among others, in the FDA Orange Book as patents covering its CRESTOR product. But the FDA-approved labeling for CRESTOR also includes several treatment regimens that are not subject to patent rights, including treatment of genetically induced high cholesterol levels (HoFH) and high triglyceride levels.

Patent Problems

The generic companies sought FDA approval to market a generic rosuvastatin to treat the cholesterol-related ailments not covered by AZ’s method of use patents—HoFH and hypertriglyceridemia. This means that their Abbreviated New Drug Application (ANDA) filing only impacted the ’314 composition patent.

In response, AZ sued the generic companies for infringement of the ’314 composition patent. The district court (after a bench trial) ruled in favor of AZ on the infringement, invalidity, and unenforceability issues and issued an injunction against the generics. That decision is the subject of a separate appeal to the Federal Circuit.

Soon after the first suit, AZ brought a second lawsuit alleging that the ANDA filings also infringed its 2 method patents listed in the Orange Book, even though the proposed labels didn’t request approval for any patented indications. AZ argued that the FDA will require that the generic companies’ final label include information relating to the patented methods to match AZ’s label. AZ also argued that the generic companies would actively encourage prescription and administration of their generic drugs to patients to treat the conditions AZ’s two method patents cover.

The district court dismissed the second lawsuit, concluding that it lacked jurisdiction because AZ hasn’t made a valid infringement claim under 35 U.S.C. § 271(e)(2) based on the generic companies’ ANDA filings. It also concluded that AZ’s claims concerning the FDA’s future labeling amendments are not ripe for review.

The Federal Circuit agreed with AZ that the district court had jurisdiction over its infringement claims. Like the earlier Allergan case, which involved a similar issue regarding a proposed ANDA label with a carve-out for patent protected methods of use, the court concluded that jurisdictional requirements are met once a patent owner alleges that an ANDA filing infringes its patent under § 271(e)(2), regardless of the strength of the ultimate claim. (This section of the patent statute makes it an act of infringement to file an ANDA application for a patented drug product or method of use.)

Yet the Federal Circuit agreed with the district court that AZ’s infringement claim is not viable and affirmed the court on this alternate ground. It concluded that the generic companies’ proposed labels, which carve out the patented methods of use, cannot constitute infringement of those methods. It also rejected AZ’s attempts to distinguish the earlier Warner-Lambert decision, which came to a similar conclusion. In the Warner-Lambert case, the court considered an ANDA application seeking to market a drug (that was not protected by a composition patent) for methods of treatment that are not covered by a patent. It determined that filing that application with the FDA is not an act of infringement under § 271(e)(2).

Additionally, the court found AZ’s argument about the “market realities” of drug prescription and administration unpersuasive. The court concluded that AZ’s position would, in practice, allow patent owners to maintain exclusive rights to a pharmaceutical compound beyond the scope of its patents’ protection. The court also deemed AZ’s infringement allegation about the FDA’s future label requirements too speculative to be ripe for a decision.

You can read the Federal Circuit’s full AZ opinion here.

Photo credit: Field Museum Library