Philip Brooks' Patent Infringement Updates

Kenyan AIDS Patients Seek To Overturn Anti-Counterfeiting Law

Nicholas Wadhams writes today, July 7, 2009, for Intellectual Property Watch:

Three HIV/AIDS patients in Kenya announced Tuesday they will petition the country’s Constitutional Court to declare a new anti-counterfeiting act illegal because it could deny them access to generic medicines. The move, which has the support of public health groups across the country, seeks to have the 2008 Anti-Counterfeiting Act made unconstitutional on the grounds that it could rob them of their right to life.

The anti-counterfeiting law, which is aimed at cracking down on the fake batteries, pens, drugs and cosmetics flooding into Kenya, has been criticised by the NGO community and importers of generic drugs because of the way it defines counterfeit products. They say its definition is so vague that it could include generic drugs. The act could also allow a pharmaceutical company to charge patent infringement in Kenya even if its patent is not registered there.

”Generic medicines are legitimate exact copies of their brand-name original. They are not counterfeits,” the three said in a statement read out at a news conference. “They should not be confused with counterfeits. The manufacturing of generic medicines is not a criminal offence.”

Advocates of the new law, including the Kenya Association of Manufacturers and brand-name drug-maker GlaxoSmithKline, argue that its language is clear and they have no intention of trying to block the import of generic drugs. The act has not yet taken effect but is expected to do so within weeks.

That has not persuaded public health advocates in Kenya. They cite more than a dozen cases in recent months that saw generic drugs made in India and bound for South America and elsewhere in Africa impounded in European ports. Customs officials argued that the drugs violated European patent rights.

Read the full article here.

Bayer Files Patent Infringement Lawsuit Against Teva

The following is excerpted from a Thursday, July 02, 2009 press release at Webwire:

Bayer Schering Pharma AG, Germany and Bayer HealthCare Pharmaceuticals Inc. together with Schering Corporation have filed a patent infringement lawsuit in the U.S. Federal Court in the District of Delaware against Teva Pharmaceuticals USA, Inc. and Teva Pharmaceutical Industries, Ltd.. The lawsuit concerns Teva’s application to the FDA for approval to market a generic form of Levitra®, Bayer Schering Pharma’s therapy for the treatment of erectile dysfunction, prior to patent expiration. The patent at issue in the suit is Bayer Schering Pharma’s U.S. Patent No. 6,362,178, expiring in 2018. In the US, Levitra® is marketed by Schering-Plough and GlaxoSmithKline.

See the full press release here.

Professional Liability Policy Excludes Patent Claims

Kenneth J. St. Onge writing today, June 25, 2009, for Insurance Journal:

A professional liability policy does not cover legal fees for patent infringement lawsuits brought by a competing company, a Pennsylvania appeals court has ruled.

The ruling comes in response to a suit brought by Transcore, a company that makes technology for electronic tolling on roadways, against its insurer, Caliber One Indemnity Co.

The suit stemmed from Caliber One's refusal to pay nearly $825,000 in legal fees spent by TransCore to defend itself in a patent lawsuit brought by a competitor, X-Cyte. X-Cyte alleged that TransCore, formerly known as Amtech, was violating X-Cyte's patent protections in a system it installed for high-speed tolling.

When notified of the case, Caliber declined to pay the legal fees. Transcore then hired its own lawyers and defended the action in court, ultimately winning the underlying lawsuit brought by X-Cyte.

TransCore then sued Caliber One, claiming the insurer -- part of PMA Capital Corp. -- improperly declined coverage.

...the Superior Court found that a professional liability policy is not designed for claims brought by third parties, such as contract or patent infringement claims. Professional liability, the court said, encompasses claims made by entities that have a professional relationship with the insured. By definition, the court ruled, competitors are not counted among that group.

Read the full article here.

Business Method Patents on Supreme Court Docket

From BPCouncil:

Some 30 years after it last looked into the subject, the Supreme Court decided to weigh in on the burning issue of software and business method patentability by granting the certiorari petition and hearing the appeal filed by inventors Bernard Bilski and Rand Warsaw. The two requested the Court to reverse the Federal Circuit’s decision in re Bilski (now known as Bilski vs. Doll), which changed the test for determining patentable subject matter in the US. While some experts are surprised at this development – saying that the Circuit’s ruling closely followed Supreme Court precedent – others saw it coming. According to Eileen McDermott, in her article for managingip.com, this latter group contends that the issues are too critical, the dollars involved too large, and the implications on the US economy (where many inventions are tied to the computer) just cannot be ignored.

Inventors Bilski and Warsaw had sought to patent a method of hedging risks in the sale of commodities, that is, a way to buy or sell energy at a fixed price based on the expected weather for a season. The application was denied by the US Patent and Trademark Office (USPTO), the case went to the US Court of Appeals for the Federal Circuit. In a 9-3 ruling that basically narrowed the scope of business processes eligible for patent protection, the Court of Appeals upheld the rejection, ruling that business method patents applied only to those tied to a particular machine or apparatus, or processes that transformed an item from one state to another. By ruling as such, the appeals court actually overturned its own 1998 decision that patents should protect business methods that had a “useful, concrete and tangible result.”

Now, the current Bilski petition to the Supreme Court asks the Court to consider whether the Federal Circuit erred in its ruling under US law and whether its machine or transformation test contradicts Congressional intent that patents protect methods of conducting business in 35 U.S.C. Section 273.

Read the full article here.

fuelperks! Patent Infringement Suit Filed Against Safeway

The following is excerpted from a June 18, 2009 press release available at Business Wire:

Excentus Corporation announced today that it has filed a lawsuit against Safeway, Inc. and Safeway subsidiaries, including Blackhawk Network, Inc., Blackhawk Marketing, LLC., and Randalls/Tom Thumb in the United States District Court for the Northern District of Texas in Abilene, alleging willful and deliberate patent infringement and the misappropriation and theft of trade secrets, among other things. The lawsuit seeks injunctive and equitable relief along with unspecified damages.

During 2006 and 2007, Safeway, through its Blackhawk subsidiaries, attempted to acquire Excentus as well as the patents owned by Auto-Gas Systems, Inc. (which are now owned by Excentus). The suit alleges that after Blackhawk failed to complete a transaction with either party, Safeway wrongfully used the patents, trade secrets and confidential information belonging to Excentus to develop its fuel rewards program called PowerPump Rewards. Excentus’ complaint also asserts that Safeway’s PowerPump Rewards program is a willful and deliberate infringement of four patents owned by Excentus.

“We believe our patent-protected fuelperks!® rewards program is the most powerful customer loyalty program ever offered in the United States,” said Dickson Perry, President and CEO of Excentus. “We have made significant investments over the last ten years to develop our world-class technology, services and expertise and acquire the related trademarks and patents, all of which are valuable components of the fuelperks! program and assets of our Company. When faced with situations like this one with Safeway, we are prepared to take the necessary steps to assure our assets and interests are protected.”

Read the full release and complaint.

Pfizer Sues Mylan Over Patents for Top-Drug Lipitor

The following is excerpted from a June 15, 2009 article by Phil Milford and Susan Decker at Bloomberg:

Pfizer Inc., the world’s biggest drugmaker, sued rival Mylan Inc. asking a judge to prohibit sales of a generic version of its cholesterol-fighting medicine Lipitor until 2017.

In federal court papers filed today in Wilmington, Delaware, lawyers for New York-based Pfizer contend a Mylan affiliate has applied to the U.S. Food and Drug Administration for permission to sell copies of Lipitor, the world’s best- selling drug, before three Pfizer patents expire.

Pfizer officials have said they’re looking for cooperative ventures with other pharmaceutical makers to increase generic sales as patents expire. Lipitor logged $12.4 billion in revenue last year, $7.7 billion of it in the U.S.

Ranbaxy Laboratories Ltd., India’s biggest drugmaker and majority owned by Japan’s Daiichi Sankyo Co., settled a lawsuit filed by Pfizer and plans to enter the market in November 2011. Pfizer already is suing Apotex Inc. and Teva Pharmaceutical Industries Ltd. to prevent them from selling copies of the medicine before then.

Read the full article here.

A123 Systems Files Motion to Reopen Case Against Hydro-Quebec

Jeffrey Gleason of Wilmer Cutler Pickering Hale and Dorr LLP, counsel for A123 Systems, Inc. filed a motion yesterday, June 11, 2009, to reopen the A123 Systems, Inc. v. Hydro-Quebec case:

Plaintiff A123 Systems, Inc. (“A123”) hereby moves the Court to reopen the above-captioned case. As grounds for this motion, A123 states that, on January 30, 2007, this Court dismissed this case without prejudice to either party moving to reopen the case prior to September 1, 2007 (Docket No. 79). On September 6, 2007, the Court granted A123’s Amended Unopposed Motion to Extend Deadline to File Motion to Reopen Case Pending Reexamination of Patents, extending the deadline to file a motion to reopen the case until thirty (30) days after the conclusion of the Reexaminations of US Patent Nos. 5,910,382 (“the ‘382 patent”) and 6,514,640 (“the ‘640 patent”) by the United States Patent and Trademark Office (“PTO”). The PTO issued reexamination certificates concluding the reexaminations for the ‘382 patent on April 15, 2008 (attached hereto as Exhibit A) and for the ‘640 patent on May 12, 2009 (attached hereto as Exhibit B).

Accordingly, consistent with the Court’s Orders, A123 respectfully requests that the Court reopen this case without prejudice to either party.

Thanks to the reader who provided the attached copy of the motion [Download A123 v HQ suit].

Cellectis SA Clarifies Competitor’s Comments on Preliminary U.S. Patent Office Action

The following is an excerpt from a June 10, 2009 Cellectis press release available at Business Wire:

On March 13, 2008, the genome engineering company Cellectis SA (Alternext: ALCLS) initiated a patent infringement lawsuit in the U.S. District Court in North Carolina against Precision Biosciences Inc., for infringing two of its patents directed to the use of molecules known as megaucleases in recombinant biotechnology. These two patents-in-suit, U.S. Patent Nos. 7,309,605 and 6,610,545, are exclusively licensed from Institut Pasteur, a world-renowned, not-for-profit research institution, and are part of a portfolio of patents and applications in the endonuclease field that Cellectis owns or to which it has exclusive rights. Currently, Cellectis holds a portfolio of 42 granted patents, with more than 130 applications for additional patents pending.

Well after Cellectis filed its suit, Precision asked the U.S. Patent Office to reexamine two related, but separate, patents also licensed exclusively to Cellectis by Institut Pasteur, U.S. Patent Nos. 7,214,536 and 6,833,252. The Patent Office recently agreed to reexamine these two related patents. “This is a normal and common administrative procedure. The process is likely to be long, involving multiple legal steps. A final decision ultimately will be given by the U.S. Patent Office and any conclusions drawn before this decision are premature,” said Dr. André Choulika, CEO of Cellectis.

The Cellectis patents to be reexamined by the U.S. Patent Office are not the two patents-in-suit that Cellectis has accused Precision of infringing in the U.S. District Court. And, in fact, Precision has not sought to reexamine the patents it has been accused of infringing.

Read the full press release here.

Largest U.S. Patent Infringement Case Ever is Controversial Too

A reader alerted me that the jury in the Star Scientific v. R.J. Reynolds case should get the case this week.  I have covered this case in numerous prior posts.  The following is excerpted from a May 19, 2009 article by Sandy Hoff at Herald de Paris:

A trial begins tomorrow in a patent infringement case that could result in the largest patent infringement award in U.S. history. It could also pave the way down tobacco road to less hazardous cigarettes, in terms of the rate of cancers caused from smoking.

The case is Star Scientific, Inc., v. R. J. Reynolds Tobacco Company, and jury selection already occurred on Monday, May 18, 2009. The trial is scheduled for 3 to 4 weeks. The venue is the U.S. District Court for Maryland, Baltimore (Northern) Division (101 W. Lombard Street, Baltimore, MD 21201 (410) 962-2600). The case is civil action number MJG 01-CV-1504 and MJG 02-CV-1504.

Aside from its status as a large patent infringement case, this is truly a David v. Goliath scenario. Tiny Star Scientific of Chester, VA is exclusive licensee of patents owned by inventor and principal stockholder Jonnie Williams. The patents are for a method of substantially eliminating what are believed to be among the most potent carcinogens, called tobacco specific nitrosamines (TSNAs), in cured tobacco, and thus potentially eliminating them from both smokeless and smoked tobacco.

If the patents are upheld in this case, royalties from other industry players, who may have infringed (and continue to do so), over the life of the patents, could amount to well over a billion dollars.

Expert testimony directly concerning the role of TSNAs in causing many of the cancers from smoking will likely be part of the damages argument. RJR/RAI has unleashed a blizzard of motions in limine to try to avoid a court room scene in which the court may have to litigate just what role smoking plays in causing cancer, and how it does so. It appears that both the court and RJR/RAI would like to avoid that scenario, and yet that matter is the crux of the worth of Star’s intellectual property, and thus determines damages and royalties.

The scene smacks of an era of legal Americana … an era in which even the most despised corporate structures in America, big tobacco, appear to hold sway, even still at least at first brush, in matters before Congress and the courts. It pits a corporate David against tobacco Goliaths in a battle in which the proverbial David tries to force the tobacco industry to improve the safety of its products using new technology, and the tobacco Goliaths seemingly fight for their right to continue doing business with only one concern - the bottom line.

Read what one commenter described as "the most honest and accurate article I’ve read on the case in the last eight years" in its entirety here.

Tafas Requests Rehearing En Banc in PTO Rules Case

From two June 4, 2009 posts by Matt Osenga at his Inventive Step blog:

One of the plaintiffs in the PTO rules case, Dr. Tafas, has filed a combined petition for the Federal Circuit panel to rehear the case, or alternatively, for the entire court to rehear the case en banc.  At this stage, it is unclear if either the PTO or the other plaintiff, GlaxoSmithKline, has filed its own petition.  Patent Docs has a good summary of Dr. Tafas’ arguments.

Basically, Dr. Tafas argues that the panel decision misapplied Supreme Court and Federal Circuit precedent in several ways.  First, the panel used the incorrect standard for determining whether a rule is substantive or non-substantive; second, the panel failed to consider the implications of the rules on individual rights and obligations; third, the panel failed to address whether the PTO had authority to enact the rules under the Patent Act; and finally, the panel erred in its Chevron deference analysis.

GSK has also filed a petition for rehearing en banc.

In its brief, GSK argues that the panel’s decision conflicts with the Supreme Court’s test for determining whether rules are procedural or substantive.  Substantive rules are those that are a “legislative-type” and that “affect[] individual rights and obligations.”

Read the posts here and here.