The United States Court of Appeals for the Federal Circuit upheld a preliminary injunction granted by the United States District Court for the District of New Jersey enjoining defendants Teva Pharmaceuticals and Ranbaxy Pharmaceuticals from selling a generic version of Accupril, a patented drug manufactured by plaintiffs Pfizer, Inc. and Warner-Lambert Company, LLC. The patent covered a pharmaceutical composition containing ACE inhibitors and other chemicals (claim 1) and their methods of manufacture (claim 16). This new composition/manufacturing process helped minimize cyclization (reaction between parts of compound causing compound to degrade), hydrolysis (reaction with water causing the compound to degrade), and oxidation (reaction with oxygen causing discoloration) of the ACE inhibitor. The Federal Circuit held that plaintiffs were likely to prevail on the merits of their claim under the district court’s construction of “saccharides.” The Federal Circuit also upheld the district court’s ruling that plaintiffs were likely to prevail under the doctrine of equivalents. In so doing, the Federal Circuit rejected defendants’ arguments that the plaintiffs had dedicated the use of microcrystalline cellulose (used by defendants) to the public by disclosing but not claiming it in the patent. The Court held that before an unclaimed subject matter can be dedicated to the public, it must be identified as an alternative to a claim limitation. The Federal Circuit also upheld the district court’s rulings that infringement of the patent was likely to cause plaintiffs irreparable harm, that the defendants’ possible loss of market share and customer relationships did not outweigh the potential harm to the plaintiffs, and that the public interest was best served by enforcing the temporary injunction.The Federal Circuit first addressed whether the district court had correctly found plaintiffs likely to prevail on their allegations of patent infringement. The Federal Circuit considered the district court’s construction of the patent claim—defining “saccharides” as all mono- and polysaccharides, not just “sugars” (polysaccharides with up to ten monosaccharides). The Federal Circuit rejected all of defendants’ arguments that this construction was inappropriate. Defendants’ claim that language in the patent stating “saccharides (i.e. sugars)” was controlling was rejected because another section of the patent formally defined saccharides more broadly. The defendants’ reliance on a construction of the patent’s use of saccharides from previous litigation was also rejected because the parties to the previous litigation specified that construction was for the purposes of the previous litigation only. The Federal Circuit also rejected defendants’ claim that the broad construction of saccharides would render the claims invalid because not enough evidence was presented that the Patent and Trademark Office would have refused to grant the claim under the broad construction. In addition, the district court’s reliance on the testimony of an expert that one of skill in the art would interpret saccharides as more than sugar was appropriate.
Given this construction of saccharides, the Federal Circuit found plaintiffs likely to succeed on the merits of their claim that defendants infringed claim 16 because defendants had already conceded that under the district court’s definition, they were “absolutely” infringing. The Federal Circuit also held that the district court was correct to rely on expert testimony in its determination that plaintiffs were likely to succeed on the merits in proving infringement of claim 1.
The Federal Circuit noted that it was not required to look further for likelihood of success on the merits, but, recognizing the early stage of the case, and that “district courts may engage in rolling claim construction,” the Court chose to address the district court’s alternative ruling that plaintiffs could have prevailed under the doctrine of equivalents. Specifically, the Federal Circuit held that plaintiffs had not dedicated the use of microcrystalline cellulose with ACE inhibitors (used by defendants) to the public by disclosing but not claiming this in the patent application. The Federal Circuit relied on the public notice function of patents to hold that before an unclaimed subject matter can be dedicated to the public, it must be identified as an alternative to a claim limitation. Here, the patent application did not specifically identify microcrystalline cellulose as an alternative to a claim limitation, and thus it was not dedicated to the public.
With likelihood of success on the merits affirmed, the Federal Circuit next addressed whether the district court had correctly found a likelihood of irreparable harm to the plaintiffs. There is a presumption that a patent holder will be harmed by infringement of a valid and enforceable patent, and therefore the burden is on the potential infringer to show the patent owner will not be irreparably harmed. The Federal Circuit found that the defendants had not presented enough evidence to support their claims. Specifically, the facts that two competitors were in the market and a narrow exclusive license had been granted did not by themselves show that plaintiffs would not be irreparably harmed. In addition, the fact that the plaintiffs had waived an automatic thirty month stay of approval of defendants’ license by not objecting within the specified time was not enough to overcome the presumption.
Next, the Federal Circuit found that the fact that the defendants might lose their market share and customer relationships did not outweigh the potential damage to the plaintiffs.
Finally, when addressing whether the injunction was in the public interest, the Federal Circuit rejected defendants’ arguments and found that allowing them to market a generic drug to the public at a low price was not enough to justify the patent infringement.