Tuesday, February 27, 2018

Patent lawyers as magicians?

Many of the "patent law" blogs have been silent on Judge Stark's ruling in favor of Gilead in the hepatitis C dispute. Law.com emphasized the lawyers rather than the substance.

Scott Graham of Law.com on the Stark decision in Idenix/Merck v. Gilead in post Skilled in the Art: Gilead's Houdini Act :

I begin today by asking: Is Fish & Richardson partner Jonathan Singer a distant relative of Harry Houdini? Once again Fish and Singer— this time with help from Irell & Manella and Orrick—have wriggled out of a massive verdict that a jury slapped on client Gilead Sciences Inc.

Fish and Gilead took a $2.5 billion hit in Delaware federal court in December 2016. Jurors found that Gilead willfully infringed a Merck patent on a hepatitis C treatment. But on Friday U.S. District Judge Leonard Stark granted Gilead’s post-trial motion to invalidate Merck’s patent for enablement, saying essentially that the patent wasn’t precise enough to predict breakthrough medicines like Gilead’s sofosbuvir.

Sound familiar? Yes, it does. In 2015 Merck scored a $200 million verdict against Gilead— same medication, different patents—but U.S. District Judge Beth Labson Freeman threw it out based on Merck’s unclean hands. Singer argued both that motion to Freeman and the enablement motion decided Friday.

A key part of the opinion of Judge Stark relies on text from the 2007 post-Supreme Court Integra Lifesciences I, Ltd. v. Merck KGaA, 496 F.3d 1334; 83 U.S.P.Q.2D (BNA) 1673 (CAFC 2007) ; for convenience IPBiz includes the FULL text of the paragraph:

The rule that a jury verdict is reviewed for support by "substantial evidence" does not mean that the reviewing court must ignore the evidence that does not support the verdict. See Reeves, 530 U.S. at 150-51 ("in entertaining a motion for judgment as a matter of law, the court should review all of the evidence in the record"). The Court in Reeves stated that "[i]n the analogous context of summary judgment under Rule 56, we have stated that the court must review the record 'taken as a whole'," citing Matsushita Elec. Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S. Ct. 1348, 89 L. Ed. 2d 538 [page 1682] (1986), and observed that "the standard for granting summary judgment 'mirrors' the standard for judgment as a matter of law, such that 'the inquiry under each is the same'," citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250-251, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). Thus the Court pointed out that "the court must draw all reasonable inferences in favor of the nonmoving party, and it may not make credibility determinations or weigh the evidence," Reeves, 530 U.S. at 150, but cautioning that "although the court should review the record as a whole, it must disregard all evidence favorable to the moving party that the jury is not required to believe. See 9A Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure § 2529, p. 299 (2d ed. 1995). That is, the court should give credence to the evidence favoring the nonmovant as well as that 'evidence supporting the moving party that is uncontradicted and unimpeached'." Id. (citations omitted).

The portion cited in the opinion by Judge Stark is as follows:

"The rule that a jury verdict is reviewed for support by 'substantial evidence' does not mean that the reviewing court must ignore the evidence that does not support the verdict.... That is, the court should give credence to the evidence favoring the nonmovant as well as that evidence supporting the moving party that is uncontradicted and unimpeached." Integra Lifesciences I, Ltd. v. Merck KGaA, 496 F.3d 1334, 1345 (Fed. Cir. 2007).

Judge Newman, in dissent in Malta v. Schulmerich Carillons, Inc., 952 F.2d 1320; 21 U.S.P.Q.2D (BNA) 1161 (CAFC 1991), laid out the standards for "substantial evidence," drawing in part from cases in the Third Circuit Court of Appeals:

The standard of judicial review of jury verdicts is established. Sometimes described as a "reasonable jury" standard and sometimes as a "substantial evidence" standard, the challenger must show that there was not an evidentiary basis for the verdict. As discussed by the Court:

But where, as here, there is an evidentiary basis for the jury's verdict, the jury is free to discard or disbelieve whatever facts are inconsistent with its conclusion. And the appellate court's function is exhausted when that evidentiary basis becomes apparent, it being immaterial that the court might draw a contrary inference or feel that another conclusion is more reasonable.

Lavender v. Kurn, 327 U.S. 645, 653, 90 L. Ed. 916 , 66 S. Ct. 740 (1946). This standard has its roots in the Constitution and in tradition, for the principles underlying the jury right require that the jury verdict receive judicial deference.

Many illustrations of the requisite standard of appellate review of jury verdicts appear in the precedent of the Third Circuit. 1Link to the text of the note [page 1171] E.g., Chuy v. Philadelphia Eagles Football Club, 595 F.2d 1265, 1273 (3d Cir. 1979) (en banc) ("Our limited function at this point is to ascertain from review of the record whether there is sufficient evidence to sustain the verdict of the jury on this issue"); Dawson v. Chrysler Corp., 630 F.2d 950, 959 (3d Cir. 1980), cert. denied, 450 U.S. 959, 67 L. Ed. 2d 383 , 101 S. Ct. 1418 (1981) (the jury verdict must be sustained unless the record "is critically deficient of that minimum quantum of evidence from which a jury might reasonably [page 1333] afford relief"), quoting Denneny v. Siegel, 407 F.2d 433, 439 (3d Cir. 1969).

Federal Circuit decisions have well illustrated this standard. E.g., Orthokinetics, Inc. v. Safety Travel Chairs, Inc., 806 F.2d 1565, 1571, 1 USPQ2d 1081, 1085 (Fed. Cir. 1986):

To convince this court that a trial judge erred in granting a motion for JNOV, an appellant need only show that there was substantial evidence to support the jury's findings and that those findings can support the jury's legal conclusion.

Also, e.g., DMI, Inc. v. Deere & Co., 802 F.2d 421, 425, 231 USPQ 276, 278 (Fed. Cir. 1986) (to reverse the jury, the findings must not be supported by substantial evidence); Shatterproof Glass Corp. v. Libbey-Owens Ford Co., 758 F.2d 613, 619, 225 USPQ 634, 636 (Fed. Cir.), cert. dismissed, 474 U.S. 976 (1985) (determining from the evidence as a whole whether there was substantial evidence in support of the jury verdict); Perkin-Elmer Corp. v. Computervision Corp., 732 F.2d 888, 893, 221 USPQ 669, 673 (Fed. Cir.), cert. denied, 469 U.S. 857, 83 L. Ed. 2d 120 , 105 S. Ct. 187, 225 U.S.P.Q. (BNA) 792 (1984) ("only when the court is convinced upon the record before the jury that reasonable persons could not have reached a verdict for the non-mover, should it grant the motion for JNOV.")

On judicial review following a duly made motion for judgment n.o.v, the evidence must be viewed and reasonable inferences drawn in the light most favorable to the party with the jury verdict. Continental Ore Co. v. Union Carbide & Carbon Corp., 370 U.S. 690, 696, 8 L. Ed. 2d 777 , 82 S. Ct. 1404 (1962); Danny Kresky Enterprises Corp. v. Magid, 716 F.2d 206, 209 (3d Cir. 1983); Chuy, 595 F.2d at 1273. The reviewing court is not free to reweigh the evidence or substitute its own judgment for that of the jury, Blair v. Manhattan Life Ins. Co., 692 F.2d 296, 300 (3d Cir. 1982), or to pass on the credibility of witnesses. Kinnel v. Mid-Atlantic Mausoleums, Inc., 850 F.2d 958, 961 (3d Cir. 1988).

Those functions are assigned to the fact-finder, in this case the jury. Our function is to determine only whether there is evidence upon which the jury could properly return a verdict, viewing the evidence most favorably to Kinnel the non-movant, and giving Kinnel the benefit of all reasonable inferences.

Id. at 961-62.

The Federal Circuit is in accord. E.g., Orthokinetics, 806 F.2d at 1572-73, 1 USPQ2d at 1085-86 (it is "a misunderstanding of our appellate role" for this court to determine what is supported by the evidence as a whole, rather than whether the evidence the jury could have believed was substantial); Connell v. Sears, Roebuck & Co., 722 F.2d 1542, 1546, 220 USPQ 193, 197 (Fed. Cir. 1983) (the appellate court must consider all the evidence in the light most favorable to the non-movant, must not determine the credibility of witnesses, and must not substitute its choice for that of the jury in finding facts, drawing inferences, or deciding between conflicting elements in the evidence). These are functions of the trier of fact, not the reviewing court.

Of review for "substantial evidence," the Court of Appeals for the Federal Circuit had stated in Hoechst Celanese Corp. v. BP Chems. Ltd., 78 F.3d 1575: [jury] determination must be upheld if any set of facts supported by substantial evidence is capable of sustaining the verdict. Orthokinetics, 806 F.2d at 1580, 1 U.S.P.Q.2D (BNA) at 1091.

In Pharmastem Therapeutics, Inc. v. Viacell, Inc., 491 F.3d 1342 , the CAFC stated:

Thus, in reviewing the denial of the JMOL motion on the issue of obviousness, we examine the evidence in the light most favorable to the verdict and determine whether a reasonable jury could have found all the facts necessary to support the verdict of nonobviousness, i.e., whether substantial evidence supports the verdict. See Caver v. City of Trenton, 420 F.3d 243, 262 (3d Cir. 2005); Connell v. Sears, Roebuck & Co., 722 F.2d 1542, 1546 (Fed. Cir. 1983).

See post on IPBiz on 18 Feb 18:

US District Court of Delaware rules against Merck in case related to hepatitis C drugs Sovaldi and Harvoni


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