Thursday, December 11, 2008

Mylan and AlphaPharm lose on attorneys fees case

The ’777 patent of Takeda covers the anti-diabetic drug pioglitazone, for which Takeda has
enjoyed commercial success under the name ACTOS®. Alphapharm and Mylan are two
generic drug companies that sought approval to produce generic versions of
pioglitazone under the Hatch-Waxman Act. Takeda prevailed in paragraph IV filings.
Takeda Chem. Indus., Ltd. v. Alphapharm Pty., Ltd., 492
F.3d 1350 (Fed. Cir. 2007); Takeda Chem. Indus., Ltd. v. Ranbaxy Labs., Ltd., No. 06-
1364, 2007 U.S. App. LEXIS 15883 (Fed. Cir. June 28, 2007).

THEN, Takeda moved under 271(e)(4) for fees as an exceptional case, contending that Mylan
and Alphapharm each lacked a good faith basis for their Paragraph IV letters. (In passing, this
general concept relates to SIU and the invocation of Illinois Supreme Court Rule 137). The Dec. 8
decision of the CAFC pertained to the exceptional case/attorneys fees matter. Edgar H. Haug of
Frommer Lawrence & Haug LLP argued for losing party AlphaPharm, and William A. Rakoczy for losing party
Mylan. The case illustrates some of the abuses that can occur when generic companies
make paragraph IV filings.

The CAFC reviewed the trial record: Regarding Alphapharm, the court held that the Paragraph IV certification
letter was “so devoid of merit and so completely fail[ed] to establish a prima facie case
of invalidity that it must be described as ‘baseless.’” September Opinion, 459 F. Supp.
2d at 235. The court discussed at length how Alphapharm’s argument at trial focused
on compound b as the lead compound for future research, whereas Alphapharm’s
certification letter focused on two other compounds and contained scientific errors. The
court also analyzed what it saw as Alphapharm’s litigation misconduct, which mainly
consisted of a shifting theory of obviousness that did not explain why compound b
would have been identified as the lead compound. Of Mylan: The court also found that the
inequitable conduct claim was “always frivolous” and unsupported, as Mylan did not
present any evidence that Takeda hid or misrepresented any information to the PTO.
Id. at 249.

Of shifting arguments: Furthermore, although it seems reasonable to expect assertions of invalidity
based on prior art to remain relatively consistent as the prior art should be known when
the certification of invalidity is made
, we do not believe that the district court faulted
Alphapharm simply for changing its obviousness argument at trial from the theory
advanced in the Paragraph IV letter. Rather, the court methodically examined a number
of shortcomings in Alphapharm’s Paragraph IV letter, which were made obvious by
Alphapharm’s “constantly shifting set of arguments,” that supported the finding that the
certification was baseless. September Opinion, 459 F. Supp. 2d at 236.

Of scientific errors: The court also catalogued scientific errors in Alphapharm’s
certification letter that the court saw as “insidious” and as underscoring that
Alphapharm “did not act with due care
or in good faith” in filing its certification.

Of standards: Thus, the trial court did not apply a simple negligence standard
but found Alphapharm’s filing

Of Mylan: But Mylan’s Rule 30(b)(6) designee testified that no reason existed to choose compound 14
as the lead compound; Takeda’s expert emphatically disagreed with the assertion that
benzene and pyridine rings are bioisosteres; and Alphapharm’s expert testified that the
properties of compound 14 taught nothing with respect to pyridines. We find it
unsurprising, therefore, that the district court characterized Mylan’s defense of the
merits of its Paragraph IV letter as “utterly frivolous.”

Separately, eBay/PayPal prevailed against NetCraft.
The case involves claim construction:

The asserted claims themselves do not expressly indicate whether “providing a
communications link through equipment of the third party” requires that the third party
provide internet access. Indeed, the term “communications link” is never used in the
parent ’221 Patent or the common specification of the asserted patents. While the lay
meaning of “communications link” standing alone may be broader than “internet
access,” we are not construing this term standing alone. See Phillips, 415 F.3d at 1321
(“Properly viewed, the ‘ordinary meaning’ of a claim term is its meaning to the ordinary
artisan after reading the entire patent.”). In order to properly determine the ordinary
meaning of the entire phrase at issue in this case, we must consider the claim terms in
light of the entire patent.

Patent prosecutors should note the CAFC went to the "summary of invention" and attached
great weight to phrases involving "the present invention" -->

We agree with Netcraft that use of the phrase “the present invention” does not “automatically”
limit the meaning of claim terms
in all circumstances, and that such language must be read in the context of the entire
specification and prosecution history. See Rambus Inc. v. Infineon Techs. AG, 318
F.3d 1081, 1094 (Fed. Cir. 2003).

But here's the rub -->

For the reasons below, however, we agree with the
district court that the common specification’s repeated use of the phrase “the present
invention” describes the invention as a whole
, see Claim Construction Order at *6, and,
as will be discussed further below, that the prosecution history does not warrant a
contrary result.

Claim differentiation appears in a footnote:

Furthermore, even if we agreed with Netcraft that the district court’s claim
construction led to some redundancy, that alone would not necessarily warrant a
different result in this case. While claim differentiation may be helpful in some cases, it
is just one of many tools used by courts in the analysis of claim terms. See, e.g.,
Nystrom v. Trex Co., 424 F.3d 1136, 1142-43 (Fed. Cir. 2005) (construing the term
“board” to mean a “piece of elongated construction material made from wood cut from a
log,” even though principles of claim differentiation suggested that the term “board”
should not be limited to wood cut from a log).


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