Federal Circuit Affirms Award of
Attorney And Expert Fees.
In Marctec v. Johnson & Johnson and Cordis Corp., Appeal No.
2010-1507 (Jan. 3, 2012), the Federal
Circuit affirmed the Southern Illinois District Court’s final judgment
declaring the case exceptional and awarding attorney and expert fees to the
defendant. In an earlier appeal, the
Federal Circuit had affirmed the district court’s grant of summary judgment
of noninfringement.
The Federal Circuit agreed with
the district court that MarcTec’s proposed claim construction was so lacking
in any evidentiary support that assertion of the claim construction was
unreasonable and reflected a lack of good faith. The Federal Circuit also
held that MarcTec’s decision to continue the litigation after claim
construction further supported the district court’s finding that this was an
exceptional case. Because MarcTec failed to show that the district court’s
findings regarding bad faith and objective baselessness were clearly
erroneous, the district court’s decision awarding fees on that ground was
affirmed.
Additionally, the Federal
Circuit held that MarcTec initiated a frivolous lawsuit and persisted in
advancing unfounded arguments that unnecessarily extended the litigation and
caused Cordis to incur needless litigation expenses. The Federal Circuit
stated that such vexatious conduct is, by definition, litigation misconduct,
and provides a separate and independent basis supporting the district court’s
determination that this case was exceptional.
The Federal Circuit affirmed the
district court’s award to Cordis of attorney fees and expenses in the amount
of $3,873,865.01, and expert fees and expenses of $809,788.02, for a total
award of $4,683,653.03.
Federal Circuit Affirms Preliminary Injunction.
In Celsis In Vitro v.
CellzDirect, Appeal No. 2010-1547 (Jan. 9, 2012), the Federal Circuit
affirmed the Northern Illinois District’s Court judgment granting Celsis’
motion for a preliminary injunction against CellzDirect, Inc. and Life
Technologies Corp. (“LTC”).
Celsis asserted infringement of a patent which claims
methods for preparing multi-cryopreserved hepatocytes (a type of liver cell).
The district court granted a preliminary injunction against CellzDirect and
LTC. LTC appealed the district court’s decision and also moved for a stay pending
appeal. The motion for a stay was
denied.
On appeal, the Federal Circuit reviews a district court’s
decision to grant a motion for preliminary injunction for an abuse of
discretion. An abuse of discretion is
found if the district court either made a clear error in weighing relevant
factors or exercised discretion based upon an error of law. The preliminary
injunction had been decided using the four-factor test. The district court
considered likelihood of success on the merits, irreparable harm, balance of
hardships and public interest.
As to likelihood of success on the merits, the testimony of
Celsis’ expert had been found very persuasive and the district court
concluded that Celsis had proved substantially more than a reasonable
likelihood of success on the subject of infringement. Moreover, the Federal
Circuit held that Celsis had shown a likelihood of success that a person of
ordinary skill in the art would not have considered the claimed methods
obvious at the time of the invention.
As to irreparable harm, the district court noted that
injuries in terms of money, time and energy expended were not enough to prove
this standard, but in this case, Celsius demonstrated that it would also
suffer from price erosion, loss of business opportunities and loss of
customer goodwill. Additionally, the
Federal Circuit affirmed that the district court did not make any mistake in
finding the balancing of harms in favor of Celsis, and since the value of the
patent, the goodwill, and the reputation of Celsis were at stake, the
injunction was justified.
Regarding the public interest, Celsis lauded the importance
to protect the investment that had been made by Celsis in drug research and
development. The Federal Circuit held
further that the record showed that the district court had considered and
properly addressed the public’s interest in obtaining an adequate supply of
pooled multi-cryopreserved hepatocyte products.
As to a bond, the Federal Circuit saw no abuse of
discretion in the district court’s bond amount.
In sum, the Federal Circuit held that the district court
correctly found that all four preliminary injunction factors favor Celsis and
that there were no reversible errors in the district court’s findings.
Accordingly, the Federal Circuit held that the district court did not abuse
its discretion in granting the motion for preliminary injunction and affirmed
the district court’s decision.
Federal Circuit Affirms Dismissal For Lack Of Standing.
In Abbott Point of
Care Inc., v. Epocal, Inc., Appeal No. 2011-1024 (Jan. 13, 2012), the
Federal Circuit affirmed the Northern Alabama District Court’s dismissal for
lack of standing.
Abbott filed a complaint against Epocal asserting
infringement of two patents dealing with blood test samples. Abbott claimed
ownership of the patents on the basis of contracts between Lauks and Abbott’s
predecessors, Integrated Ionics Incorporated (“Integrated Ionics”) and i-STAT
Corporation (“i-STAT”).
In 1984, Lauks signed an employment agreement with
Integrated Ionics including confidentiality, non-competition, and
non-solicitation clauses. The contract also required that the employee had to
assign its inventions to his employer. Integrated Ionics subsequently became
i-STAT, and Lauks executed another employment agreement which included Lauks’
employment duties, compensation, benefits, termination, and severance
payments.
In 1999, Lauks resigned from i-STAT and signed an
eighteen-month Consulting Agreement with i-STAT which specified that only the
confidentiality provision stated in the 1984 Agreement remained in place.
In 2001, Lauks filed two patent applications identifying
himself as the sole inventor. In 2003,
Lauks assigned the patents to Epocal.
In 2009, Abbott filed a complaint asserting infringement of
the patents and ownership. According to Abbott, Lauks had agreed to disclose
and assign his inventions to Abbott’s predecessors. Epocal filed a motion to
dismiss for lack of subject matter jurisdiction and failure to state a claim.
The district court concluded that Abbott lacked standing because the 1999
Agreement did not continue the 1984 Agreement, and therefore, Abbott did not
own the patents-in-suit.
On appeal, the Federal Circuit reviewed the agreements and
determined that the 1999 Consulting Agreement recognized and allowed Lauks to
pursue other, non-conflicting interests, and explicitly excluded work on new
products, regardless of the subject matter, including point-of-care blood
analysis applications. The Federal
Circuit stated that because the 1999 Consultation Agreement was silent with
respect to any assignment of Lauks’ rights in inventions, improvements, or
discoveries made or conceived during the consultation period, Lauks had no
obligation to assign inventions from the consulting period to i-STAT. Thus,
the district court had correctly concluded that the contract did not convey
all substantial interest in the patents and that Abbot did not own the
patents.
Accordingly, the Federal Circuit affirmed the district court’s
dismissal for lack of standing.
Federal Circuit Affirms Judgment To Correct Inventorship Under
35 U.S.C. § 256.
In Olusegun Falana v. Kent State University & Alexander J. Seed,
Appeal No. 2011-1198, the Federal Circuit affirmed the Northern Ohio District
Court’s judgment ordering the USPTO to add Falana as an inventor of the
patent.
Kent
Displays. Inc. (KDI), a Kent
State Company, started in 1997 to develop chemical compounds that could be
used to improve the performance characteristics of electronic devices. Dr.
Olusegun Falana, a researcher, was hired by KDI to synthesize chiral organic
molecules for the project. He developed a specific synthesis of the Compound
7. Then Falana left the company and Seed, his successor, synthesized a
compound designated Compound 9. Compound 9 was an enantiomer of Compound 7.
In 2000, KDI and
Kent
State
filed a patent application. The patent specification disclosed the synthesis
protocol developed by Falana as the protocol utilized to synthesize the
claimed class of chiral compounds. However, Falana was not named as an inventor. Falana filed a complaint seeking correction
of inventorship, alleging that he should have been named an inventor of the
patent.
After a bench trial, the
district court declared that Falana contributed to the conception of the
claimed invention. Additionally, the district court ruled the case to be
exceptional and awarded attorney fees.
Kent
State
appealed.
On appeal,
Kent
State
alleged that the district court erred in its claim construction and abused
its discretion in excluding certain exhibits.
Kent
State
also appealed on the joint-inventor issue.
As to the claim construction,
the Federal Circuit held that the district court did not make any mistake in
construing the language of the claims.
As to the inventorship issue,
the main question was whether a putative inventor who envisioned the
structure of a novel chemical compound and contributed to the method of
making that compound is a joint-inventor of a claim covering that
compound. The Federal Circuit held
that the claims of the patent were not limited to Compound 9 but covered a
broader genus. Because Falana
contributed to the conception of the genus by providing the method for making
the novel compounds, and the KDI team used Falana’s protocol to synthesize
another species within the claimed class of compounds, the Federal Circuit
upheld the district court’s finding that Falana should be named as an inventor.
The Federal Circuit did not
address the district’s court case determination that the case was exceptional
and the attorneys fees award since these issues were not yet final.
Greenblum & Bernstein Hosting Biosimilars Workshop
Greenblum & Bernstein is hosting a pre-conference
workshop titled: Biosimilars In America: IP Strategy and Due Diligence at the
10th EGA International Symposium on Biosimilar Medicines that will take place
April 19-20, 2012 in London. |