Saturday, August 16, 2008

CAFC gives exposition of DJ issues, post MedImmune, in Prasco case

The fate of the TSM test in obviousness, post KSR, has been discussed. Note also the
fate of "reasonable apprehension", post MedImmune, is also being discussed. In Prasco v. Medicis,
the CAFC gives a thorough discussion, post MedImmune, of DJ jurisdiction. In the case, Prasco
lost, with the CAFC noting: Prasco has failed to establish a case or controversy under Article III.

**The CAFC noted of MedImmune, Inc. v. Genentech, Inc., 127 S. Ct. 764 (2007)-->

For there to be a case or controversy under Article III, the dispute must be
“definite and concrete, touching the legal relations of parties having adverse legal
interests,” “real and substantial,” and “admi[t] of specific relief through a decree of a
conclusive character, as distinguished from an opinion advising what the law would be
upon a hypothetical state of facts.” MedImmune, 127 S. Ct. at 771 (quoting Aetna Life,
300 U.S. at 240-41). As the Supreme Court has recently reiterated, however, there is
no bright-line rule for determining whether an action satisfies the case or controversy
requirement. Id. To the contrary, “[t]he difference between an abstract question and a
‘controversy’ contemplated by the Declaratory Judgment Act is necessarily one of
degree, and it would be difficult, if it would be possible, to fashion a precise test for
determining in every case whether there is such a controversy.” Md. Cas. Co. v. Pac.
Coal & Oil Co., 312 U.S. 270, 273 (1941). Instead of a bright-line rule, “the analysis
must be calibrated to the particular facts of each case,” Cat Tech LLC, 528 F.3d at 879,
with the basic standard being whether “the facts alleged, under all the circumstances,
show that there is a substantial controversy, between parties having adverse legal
interests, of sufficient immediacy and reality to warrant the issuance of a declaratory
judgment,” MedImmune, 127 S. Ct. at 771 (quoting Md. Cas. Co., 312 U.S. at 273); see
also Caraco Pharms. Labs. Ltd. v. Forest Labs., 527 F.3d 1278, 1290 (Fed. Cir. 2008).
While this standard can be analyzed directly, the Supreme Court has also developed
various more specific but overlapping doctrines rooted in the same Article III inquiry,
which must be met for a controversy to be justiciable, including standing, ripeness, and
a lack of mootness. See Caraco, 527 F.3d at 1291 (citing Lujan v. Defenders of
Wildlife, 504 U.S. 555, 560 (1992) (standing); Abbott Labs. v. Gardner, 387 U.S. 136,
149 (1967) (ripeness); and U.S. Parole Comm’n v. Geraghty, 445 U.S. 388, 397 (1980)

**The CAFC grabs for a bit of "reasonable apprehension" -->

Prior to MedImmune, this circuit had generally required that a declaratory
judgment plaintiff in a patent dispute demonstrate (1) conduct by the patentee that
created a “reasonable apprehension” of suit on the part of the declaratory judgment
plaintiff and (2) present activity by the declaratory judgment plaintiff that could constitute
infringement or “meaningful preparation” to conduct potentially infringing activity. See,
e.g., Glaxo Inc. v. Novopharm Ltd., 110 F.3d 1562, 1571 (Fed. Cir. 1997). However, in
MedImmune, the Supreme Court found that requiring a reasonable apprehension of suit
conflicted with the Court’s precedent. MedImmune, 127 S. Ct. at 774 n.11. While the
Supreme Court rejected the reasonable apprehension of suit test as the sole test for
jurisdiction, it did not completely do away with the relevance of a reasonable
apprehension of suit. Rather, following MedImmune, proving a reasonable
apprehension of suit is one of multiple ways that a declaratory judgment plaintiff can
satisfy the more general all-the-circumstances test to establish that an action presents a
justiciable Article III controversy.
Caraco, 527 F.3d. at 1291.

**Here, the CAFC uses a standing analysis:-->

Considering the totality of the circumstances, Prasco has not alleged a
controversy of sufficient “immediacy and reality” to create a justiciable controversy. This
“immediacy and reality” inquiry can be viewed through the lens of standing. To satisfy
standing, the plaintiff must allege (1) an injury-in-fact, i.e., a harm that is “‘concrete’ and
actual or imminent, not ‘conjectural’ or ‘hypothetical,’” (2) that is “fairly traceable” to the
defendant’s conduct, and (3) redressable by a favorable decision. Caraco, 527 F.3d at
1291 (quoting Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 102-03 (1998)); see
also DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 342 (2006). Absent an injury-in-fact
fairly traceable to the patentee, there can be no immediate and real controversy.

**Subjective fears of a suit are not enough-->

More importantly, the Supreme Court has emphasized that a fear
of future harm that is only subjective is not an injury or threat of injury caused by the
defendant that can be the basis of an Article III case or controversy. City of L.A. v.
Lyons, 461 U.S. 95 (1983); see also Indium Corp. of Am. v. Semi-Alloys, Inc., 781 F.2d
879, 883 (Fed. Cir. 1985) (“A purely subjective apprehension of an infringement suit is
insufficient to satisfy the actual controversy requirement.”). Rather, “it is the reality of
the threat of . . . injury that is relevant to the standing inquiry, not the plaintiff’s
subjective apprehensions.” Lyons, 461 U.S. at 107 n.8 (emphasis in original); see also
Laird v. Tatum, 408 U.S. 1, 13-14 (1972) (“Allegations of a subjective ‘chill’ are not an
adequate substitute for a claim of specific present objective harm or a threat of specific
future harm; ‘the federal courts established pursuant to Article III of the Constitution do
not render advisory opinions.’”).

**The absence of indicia was important-->

Taking all the facts into account, Prasco has not met this threshold burden of
proving an immediate and real controversy. Important to the totality of the
circumstances analysis in the instant case is that which has not occurred.
(...)In contrast, here the defendants have not accused Prasco of infringement or
asserted any rights to OSCION™, nor have they taken any actions which imply such
claims. Instead, all we have before us is Prasco’s allegation that its product does not
infringe the defendants’ patents.

**A patentee is not a testing lab for a potential infringer-->

A patentee has no obligation to spend the time and
money to test a competitors’ product nor to make a definitive determination, at the time
and place of the competitors’ choosing, that it will never bring an infringement suit. And
the patentee’s silence does not alone make an infringement action or other interference
with the plaintiff’s business imminent.

***See also


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