Articles
IP Law & Business’ 2010 issue places the firm No. 1 in the “Overall” and “Patent Prosecution” categories of their “Who Protects Innovation in America” survey. Please click here to read the full article and survey results.
Baseless Paragraph IV Certifications and Shifting Obviousness Defenses
Matthew Avery
Introduction
A recent case may change the calculus generic drug manufacturers use when determining whether to file Paragraph IV challenges. In Takeda Chemical Industries, Ltd. v. Mylan Pharmaceuticals, Inc., the United States Court of Appeals for the Federal Circuit affirmed a district court decision that required two generic companies to pay a patentee $16.8 million in attorney fees, expert fees and expenses. In the case, Mylan and Alphapharm filed abbreviated new drug applications to make generic versions of Takeda’s diabetes treatment Actos. As required by the Hatch-Waxman Act, the applications included Paragraph IV certifications asserting that Takeda’s patent on the drug was invalid. During the subsequent patent litigation, the generic challengers shifted their obviousness defenses from the theories originally presented in their Paragraph IV certifications. When Takeda ultimately prevailed, the district court granted Takeda’s motion for attorney fees, finding that Mylan and Alphapharm’s shifting obviousness defenses showed that they had filed “baseless” Paragraph IV certification in violation of their “duty of care” under the Hatch-Waxman Act. Takeda demonstrates that generic companies challenging pharmaceutical patents put themselves at risk of having to pay attorney fee awards when they shift their invalidity defenses from those initially asserted in their Paragraph IV certifications.
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Lucent v. Gateway and Cornell v. Hewlett-Packard: Signaling Stricter Application of Damage Apportionment Standards in the Federal Circuit
Jeff Becker
In April of 2009, Judge Rader of the United States Court of Appeals for the Federal Circuit, sitting by designation in the Northern District of New York, slashed a $186 million jury verdict against Hewlett-Packard to $53 million in Cornell University v. Hewlett-Packard Company. Later in 2009, the Federal Circuit vacated a $358 million jury verdict against Microsoft and remanded the case for a new trial on damages in Lucent Technologies v. Gateway, Inc. These cases seem to signal a new willingness of the judges of the Federal Circuit to scrutinize jury awards in patent cases and reduce or vacate those deemed excessive. In both cases, the courts closely scrutinized the plaintiff’s damage evidence and concluded that it did not support the verdict. As a result, to protect damages awards from being vacated or subjected to remittitur, patent plaintiffs now may see an increased need to provide more detailed, and thus more expensive, customer demand evidence in order to prove entitlement to the Entire Market Value Rule. Otherwise, they may be incentivized to lower their damages models accordingly. However, this apparent increased evidentiary burden raises new questions, including the impact that more detailed customer demand evidence will have on apportionment of damages in the future.
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