Cert. Denied in Eli Lilly v. Sun Pharmaceuticals

By Kevin E. Noonan --

The Supreme Court refused today to grant certiorari in Eli Lilly & Co. v. Sun Pharmaceutical Industries, Ltd. on the question of obviousness-type double patenting.  In doing so, the Court let stand precedent that seriously expands the scope of the obviousness-type double patenting standard, turning a legal principle that was "clear" to one "distorted by divergent statements[] leading to [a] flawed ruling," according to Judge Newman (joined by Judges Lourie and Linn and Chief Judge Rader) in dissent from denial of Eli Lilly's petition for rehearing en banc.

To recap, a Federal Circuit panel (opinion by Judge Prost, joined by Judges Gajarsa and Bryson) affirmed the District Court judgment that claims of Eli Lilly's U.S. Patent No. 5,464,826 ("the '826 patent) were invalid for obviousness-type double patenting over another Lilly patent, U.S. Patent No. 4,808,614 ("the '614 patent") (see Patent Docs report).  The '614 patent claims gemcitabine, and methods of using gemcitabine to treat viral infections, while the '826 patent claims methods of using gemcitabine for treating cancer.  Eli Lilly markets the drug GEMZAR®, which contains gemcitabine as the active ingredient, for the treatment of various forms of cancer.  Accordingly, both the '614 and '826 patents were listed in the Orange Book with respect to GEMZAR®.  Sun filed an ANDA in 2006 to market a generic version of GEMZAR®, and filed a declaratory judgment action in 2007, asserting, among other things, that the '826 patent was invalid.  The U.S. District Court for the Eastern District of Michigan granted Sun's motion for partial summary judgment that the asserted claims of the '826 were invalid based on obviousness-type double patenting.

The history of these patents and their interrelationship were important factors leading to the panel decision.  The '614 patent was a continuation-in-part of a priority patent that disclosed gemcitabine and its antiviral activity.  The application that eventually gave rise to the '614 patent contained additional disclosure regarding the anticancer activities of gemcitabine but contained no claims to this activity.  The '826 patent, in an application filed on the same day as the application that resulted in the '614 patent, both disclosed and claimed this activity and methods for exploiting the anticancer properties of gemcitabine in methods for treating cancer with the drug.  Thus, the '614 patent was entitled to the priority claim to the original patent while the '826 patent was not.

The panel opinion relied on two earlier cases, Geneva Pharm., Inc. v. GlaxoSmithKline PLC, 349 F.3d 1373 (Fed. Cir. 2003), and Pfizer, Inc. v. Teva Pharm. USA, Inc., 518 F.3d 1353 (Fed. Cir. 2008) in deciding that the '826 claims were invalid over the '614 patent in obviousness-type double patenting grounds.  These cases can be distinguished, however, since in both cases the specifications disclosed one and only one activity (or use) for the claimed compound, not (as here) an additional, new use.  Also, the panel used what was disclosed, rather than just what was claimed in the '614 patent in making its obviousness-type double patenting rejection of the '826 patent, and this is where the opinion veered significantly from prior precedent.  In doing so, the panel created a per se rule of obviousness-type double patenting that, while promoting certainty also "upsets the settled expectations of the patenting community" by significantly expanding the scope of the obviousness-type double patenting doctrine.

Specifically, under the rule established by the panel opinion, if the earlier of two co-owned patents includes claims to a compound and discloses one or more uses for the compound in the specification, under the Federal Circuit's ruling any claim(s) in a later patent to any method of use disclosed (but not claimed) in the specification of the earlier patent are per se invalid based on obviousness-type double patenting.  This rule is contrary to prior case law, both in removing flexibility in considering the effect of the later patent on "improperly extending 'protection, beyond the date of expiration of the [earlier] patent, of the very same invention claimed therein . . . or of a mere variation of that invention which would have been obvious to those of ordinary skill in the relevant art,'" In re Kaplan, 789 F.2d 1574, 1579-80 (Fed. Cir. 1986), but also by collapsing the obviousness-type double patenting analysis into obviousness under 35 U.S.C. § 103 (using the patentee's own prior patent as if it were prior art under 35 U.S.C. § 102).  This constitutes a new, non-statutory type of prior art, a patentee's own prior patent application that was not "by another" and did not constitute a statutory bar (i.e., the patentee's own earlier work disclosed more than a year before the later application's filing date).  This is expressly contrary to the Federal Circuit's earlier precedent, e.g., General Foods Corp. v. Studiengesellschaft Kohle mbH, 972 F.2d 1272 (Fed. Cir. 1992), that a commonly owned, prior patent disclosure cited in support of a double patenting rejection cannot be used as though it were prior art.  Specifically, the earlier-filed patent disclosure is not to be considered in making an obviousness-type double patenting rejection.  In re Kaplan, 789 F.2d 1574 (Fed. Cir. 1986).

Despite this disjunction between prior precedent and the panel opinion, the Federal Circuit declined to rehear the case en banc, in a 5-4 ruling from a diminished number of active judges.  Thus, Eli Lilly's only recourse was to appeal to the Supreme Court; however, consideration by the Court was unlikely, for several reasons.  First, the Supreme Court is a generalist court interested in the more significant, "high profile" cases that have characterized the Court's patent jurisprudence for the past decade (including KSR Int'l Co. v. Teleflex Inc., eBay Inc. v. MercExchange, LLC, Quanta Computer, Inc. v. LG Electronics, Inc., Microsoft Corp. v. AT&T Corp., Dickinson v. Zurko).  The obviousness-type double patenting doctrine lies deep in the minutiae of patent law and was unlikely to attract the Court's attention.  The Court also takes interest in patent law questions from the Federal Circuit where the court seems divided (such as Warner-Jenkinson Co. v. Hilton Davis Chemical Co. and Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co.).  This question was important (for the pharmaceutical industry in general) but it will take the Federal Circuit in its entirety to choose a case where the irregularities introduced into this important patent law doctrine will be set straight.

Patent Docs filed an amicus case in support of certiorari in this case.

Comments

[Robert Cook-Deegan]

Kevin,

I gather from your piece that you believe this deviates from precedent and CAFC will recognize that in a future case, and that therefore this is not setting a new precedent, but an anomaly. Can one be sure of that, or is this a new precedent, albeit possibly transient and metastable?

[moocow]

I don't see how this would not be precedent as of now, transient or otherwise. Patentees would be well-advised to scour the non-prior art specifications of their earlier-issued patents for any hint of disclosures that spell out - or suggest - uses or methods that were claimed in later-issued patents.
I think this case is extremely troubling - this has nothing to do, as Kevin noted, with the improper extension of the patent right that the doctrine originally tried to get at. It's a simple game of "gotcha" that the patentee couldn't have foreseen.

[Kevin E. Noonan]

Dear Bob:

Moocow is correct, that this opinion is precedential and should be followed by subsequent panels unless and until the court decides the issue en banc. Mrs. Noonan has no children befuddled enough to predict what the Federal Circuit (or any court) will decide, but the decision to rehear en banc was decided 5-4, with several of the most senior judges voting to rehear the case (including the Chief Judge). Since the decision, Judges O'Malley and Reyna have joined the court, and there is another judge still to be confirmed. Thus, there is a good chance that the next time a party requests rehearing en banc the court will grant it (the court has chosen in recent years to hear several cases involving particular patent law areas, including subject matter eligibility, written description and inequitable conduct). So this decision could be subject to "correction" under the right circumstances.

And the opportunity should arise, since OTDP has become the "defense du jour" in ANDA litigation.

Thanks for the comments.

[Dan Feigelson]

Kevin, I'm confused as to why the original CAFC panel decision in this case is considered precedential. If a panel within a federal appellate court decides an issue of first impression, then that ruling becomes binding on subsequent panels presented with the same question, unless and until the earlier ruling is overturned by an en banc decision of that appellate court. But that's not what transpired here: instead, there's an earlier CAFC panel decision that says OTDP analysis must be conducted comparing only the *claims* of the patent with the claims of the still-pending application (or later-issued patent). So this panel decision should be a nullity. Of course, Judges Prost, Gajarsa and Bryson knew this and ignored it; there's no reason to expect them to reverse themselves now and adhere to precedent. So I agree that practically, patentees may lose patents as a result of this decision. But that doesn't make it precedential, it just means that some CAFC judges ignore the rules governing their own court.

Also, regarding the statement "Thus, the '614 patent was entitled to the priority claim to the original patent while the '826 patent was not", I disagree: the '614 patent is only entitled to the earlier priority to the extent that what was disclosed and claimed in the '614 patent was also disclosed throughout the continuation/divisional chain. Here, the anti-cancer properties and uses were disclosed for the first time the concurrently-filed applications that led to the '614 and '826 patents. So as far as anti-cancer goes, both were only entitled to the same filing date; '614 wasn't entitle to priority for anti-cancer. The '614 would have been entitled to the earlier filing date with respect to anti-viral properties and uses, had such been claimed therein, but they weren't.

[Kevin E. Noonan]

Dear Dan:

To address the second point first, you are correct - but since the '826 patent was only directed to the anti-cancer methods, my point was that the '614 patent was the "earlier-filed" one even though both the '614 and '826 applications were filed on the same day.

As for its precedential effect, on the trivial side the case was "precedential" rather than "non-precedential," but more importantly at least 5 members of the court "agree" with it (or at least don't believe that the decision was incorrect enough to merit en banc review). Just using combinatorial statistics there will be about an equal likelihood that future panels with consist of a majority made up of the judges who voted not to rehear the appeal en banc. So functionally the court has changed the law in a way that is precedential in every way that matters.

Thanks for the comment.