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The United States Court of Appeals for the Federal Circuit (CAFC) in GlaxoSmithKline LLC v. Teva Pharmaceuticals USA, Inc. reversed the district court’s judgment. The appeal was against the judgment as a matter of law (JMOL) of District court.
The legal question involved:
WhetherTeva committed an actively induced infringement of Glaxo Smith Kline’s (GSK’s) patent directed to a method of treating Congestive Heart Failure (CHF) using carvedilol or not?
Whether the court was correct in sustaining Jury’s verdict or not?
Background of the case:
United States Patent No. 4,503,067 (the ’067 patent) was owned by GDK and on March 5th, 2007, it expired. Another United States Patent No. 5,760,069 (the ’069 patent) was listed in FDA’s Orange Book for reducing mortality rate occurring due to CHF. It was for a method of treatment of CHF using a combination of carvedilol and “one or more of an angiotensin-converting enzyme (ACE) inhibitor, a diuretic, and digoxin.”And this claimed combination got the approval under the name Coreg® in 2003. It was approved “for patient’s usages who are suffering from left ventricular dysfunction following myocardial infarction.”
Teva applied for FDA approval of “its generic carvedilol, certifying in the Abbreviated New Drug Application (ANDA) under Paragraph III of the Hatch- Waxman Act that its product would not be launched until the ’067 patent expired in March 2007.” In the application for approval, Teva certified that the ’069 patent was “invalid, unenforceable, or not infringed” and, particularly stated that the claims of the ’069 patent were invalid for anticipation or obviousness. The FCA tentatively approved Teva’s ANDA “for treatment of heart failure and hypertension.” Subsequently in 2003, GSK filed an application to reissue the ’069 patent, for the purposes of adding the following limitation to the claims: “wherein the administering comprises administering to said patient daily maintenance dosages for a maintenance period to decrease a risk of mortality caused by congestive heart failure, and said maintenance period is greater than six months.” The reissue application issued as Reissue Patent No. RE40,000 (the ‘000 patent).
In 2014, GSK filed a suit against Teva and Glenmark Pharmaceuticals USA. A jury found that Teva induced infringement of claims 1-3 from the issue date of the ‘000 patent. The jury determined damages based on “a combination of lost profits and royalty and found that the infringement was willful.” However, the district court granted Teva’s motion for judgment as a matter of law (JMOL), “stating that the verdict of induced infringement was not supported by substantial evidence because ‘GSK failed to prove by a preponderance of the evidence that Teva’s alleged inducement, as opposed to other factors, actually caused the physicians to directly infringe, by prescribing generic carvedilol and to do so for the treatment of mild to severe CHF.” GSK appealed to the CAFC alleging that the district court erred in both laws and in fact in granting Teva’s JMOL.
Contentions of GSK:
The district court was wrong in its judgment because Teva fulfilled the legal requirements of committing active inducement of infringement by marketing carvedilol. The act of Marketing was done with the knowledge and intent of its infringing use.
The district court made an error in law as well. Reason being that the established precedent is “induced infringement may be shown by evidence that the accused inducer promoted the infringing use with the knowledge that such use directly infringes the patent claims.” This was misinterpreted by the court.
Contentions of Teva:
Observations of CAFC:
The jury was correct in stating “It could find inducement if Teva continued to take any action that began before the ’000 patent issued, after the ‘000 patent was issued on January 8, 2008, intending to cause the physicians to directly infringe by administering Teva’s carvedilol product.”
The jury properly considered evidence, including Teva’s press releases, expert testimony, and product catalogs.
The district court was wrong in applying legal standards.
It is clear precedent telling about the criteria of induced infringement. It is met when the provider of an identical product has knowledge about its identical characteristics and still markets the same product.
CAFC cited 2 cases for explaining important law facts, which were:
Global-Tech Appliances, Inc. v. SEB S.A.: “Copying of a patented product is evidence of inducing infringement and such inducement is not negated by the direct infringers’ knowledge of the infringing subject matter.”
Warsaw Orthopedic, Inc. v. NuVasive, Inc.: “The element of intent in induced infringement may be proven through circumstantial evidence.”
The jury instructions were in “conformity to the law” and therefore, damages were sustained.
The jury’s grant of JMOL was reversed and the case was remanded to the district court for reinstatement of the jury’s verdicts of infringement and damages.
Chief Judge Prost Had Dissented Opinion
Chief Judge Prost wrote a dissenting opinion stating wherein she expressed “The majority’s opinion undermined a critical balance between patent protection and public access once a patent expires by allowing a drug marketed for unpatented uses to give rise to liability for inducement and by permitting an award of patent damages where causation has not been shown. Noting that the district court was correct in granting Teva’s JMOL.”
Prost further added “The district court carefully considered the evidence GSK presented and concluded that the evidence showed that not even a single doctor was induced to infringe the ‘000 patent based on Teva’s actions. It was undisputed that Teva’s label did not include treating CHF or the patented method.”
Prost concluded by explaining “Teva did everything right by using a skinny label and taking care not to encourage infringing uses but it ended up more costly for Teva to sell an unpatented drug for unpatented uses than it would have been to stay out of the market altogether.”