Judges: Lourie (author), Friedman, Schall (concurring-in-part and dissenting-in-part)

[Appealed from D. Del., Judge Farnan]

In Forest Laboratories, Inc. v. Ivax Pharmaceuticals, Inc., No. 07-1059 (Fed. Cir. Sept. 5, 2007), the Federal Circuit affirmed the district court’s entry of judgment with respect to the validity of U.S. Reissue Patent No. 34,712 (“the ’712 patent”) and its entry of an injunction as to both Ivax Pharmaceuticals, Inc. (“Ivax”) and Cipla, Ltd. (“Cipla”), but modified the injunction to apply only to the product described in the ANDA.

Forest Laboratories, Inc., Forest Laboratories Holding, Ltd., and H. Lundbeck A/S (collectively “Forest”) market Lexapro®, an antidepressant. Escitalopram oxalate (“EO”), the active ingredient in that drug, is one of the compounds covered by the claims of the ’712 patent. Specifically, the ’712 patent is directed to a substantially pure (+)-enantiomer of citalopram (also referred to as “escitalopram”) and nontoxic acid addition salts thereof.

Ivax filed an ANDA for approval to market generic EO, certifying as part of the ANDA that the claims of the ’712 patent were invalid and/or not infringed. In response, Forest filed suit, alleging that Ivax’s filing of the ANDA infringed the ’712 patent. Ivax denied infringement and counterclaimed that the ’712 patent was invalid. Forest amended its complaint to add Cipla, the intended supplier of EO and a co-contributor of the information filed in the ANDA. The parties stipulated to a specific claim construction and agreed, based on that stipulation, that the proposed products in the ANDA and the proposed process for making those products infringed the ’712 patent. Thus, only the counterclaims were before the district court. In a bench trial, the district court considered whether the claims were invalid as anticipated by, or obvious over, an article by Donald Smith (“the Smith reference”). The district court also considered whether claim 11 was improperly broadened through reissue.

The district court found that the Smith reference did not anticipate the claims of the ’712 patent because it did not disclose substantially pure escitalopram as claimed and that it did not enable a person having ordinary skill in the art to obtain that compound. The district court also found that Ivax and Cipla had failed to prove by clear and convincing evidence that any of the asserted claims of the ’712 patent were obvious. In addition, the district court found that claim 11 of the ’712 patent was not invalid for impermissible broadening during reissue. Specifically, during the reissue proceeding that resulted in the ’712 patent, claim 11 was corrected to claim a method of converting a (-)-diol intermediate to (+)-citalopram, rather than using a (+)-diol intermediate as shown in the original patent claim.

The district court found that, given the specific description of the process in the specification, this change amounted to correction of a typographical error. Therefore, it held that the scope of claim 11 had not been improperly enlarged during reissue. The district court also enjoined both Ivax and Cipla “from commercially making, using, offering to sell or selling within the United States, or importing into the United States any products that infringe the ’712 patent, including the escitalopram oxalate products referred to in the [ANDA] until such time as the ’712 patent expires.” Slip op. at 6. Ivax and Cipla appealed.

On appeal, the Federal Circuit first addressed the anticipation issue. Agreeing with Forest, the Federal Circuit noted that the district court’s findings relating to enablement of the Smith reference were not clearly erroneous, and, based upon those findings, found no error in the district court’s conclusion that the Smith reference was not enabled with respect to (+)-citalopram. In so finding, the Court noted that Ivax and Cipla failed “[to] inform [it] why the district court was not entitled to rely on the evidence favorable to Forest or demonstrate that the evidence favorable to them heavily outweighed the evidence favorable to Forest.” Id. at 9. The Court concluded that given Ivax and Cipla’s failure to disturb the “detailed and thorough factual findings underlying the district court’s decision,” it saw no error in the finding that the Smith reference was not enabling and, hence, did not anticipate the claims of the ’712 patent. Id.

Similarly, with respect to obviousness, the Federal Circuit noted that the district court’s key factual findings underlying its conclusions on obviousness were not clearly erroneous, and based upon those findings, it found no error in the district court’s conclusion that the asserted claims of the ’712 patent were not invalid for obviousness. The Court added that “[t]he district court applied the Graham factors to conduct a thorough analysis of the evidence, and [it found] no clear error on facts and no error of law.” Id. at 11. It concluded that the district court’s findings fully supported the conclusion that the claimed subject matter would not have been obvious to one of ordinary skill in the art.

The Federal Circuit then turned to the question of whether claim 11 had been impermissibly broadened during reissue. The Court noted that the ’712 patent resulted from an application filed more than two years after the grant of the original patent, and that the claims of a reissue patent filed after that date would be invalid if they enlarge the scope of the original claims. However, explained the Court, “a change in a reissue application that is only clerical does not necessarily broaden the scope of the claims and so does not render the patent invalid.” Id. at 12. The Court stated that the question before it was whether the change in the reissue application broadened the scope of claim 11 or merely clarified or corrected the original claim. It added that “[c]omparison of the scope of the reissue claims with the claims of the original patent is a matter of claim construction, and it is performed from the perspective of one having ordinary skill in the art.” Id.

Applying these principles, the Court agreed with Forest that the change in claim 11 did not broaden the scope of the claim. The Court reasoned that “[t]he patent specification support[ed], even compel[led], this conclusion.” Id. It reviewed the specification and concluded that it was clear from the details presented in the relevant reaction scheme that it was the (-)-diol intermediate that was used to produce (+)-citalopram. The Court concluded that given the specification and the additional supporting expert testimony also relied upon by the district court, it saw no error in the district court’s finding that a person of ordinary skill in the art reviewing the ’712 patent would find the error in claim 11 apparent. The Court therefore agreed that the change during reissue did not represent a change of claim scope, but merely a correction of the claim to be consistent with the disclosure of the specification.

The Federal Circuit next addressed the scope of the district court’s injunction. The Court noted that it did not agree with the scope of the injunction because it included products other than escitalopram oxalate. The Court explained that it has held that the only acts an injunction may prohibit are infringement of the patent by the adjudicated products and infringement by products not more than colorably different from the adjudicated products. It noted that in order to comply with Rule 65(d) of the Federal Rules of Civil Procedure, the injunction should explicitly proscribe only those specific acts. Applying these principles, the Court noted the ’712 patent covered a range of products beyond those described in the ANDA and that the statute, 35 U.S.C. § 271(e)(4)(B), limits injunctive relief to the “approved drug.” The Court reasoned that, thus, while the injunction may properly extend to the “approved drug,” it should not extend to the remainder of the products covered by the ’712 patent. It therefore modified the injunction to delete the language “any products that infringe the ’712 patent, including.” Id. at 15.

Ivax and Cipla also argued that the injunction was improper with respect to Cipla because Cipla did not file the ANDA. Instead, Cipla’s role was limited to providing Ivax with information to support the ANDA submission. Rejecting this argument, the Federal Circuit noted that section 271(e)(2) may support an action for induced infringement. The Court noted that the only difference in the analysis of a traditional infringement claim and a claim of infringement under section 271(e)(2) is the timeframe under which the elements of infringement are considered.  It observed that “[a]n inquiry into induced infringement focuses on the party accused of inducement as the prime mover in the chain of events leading to infringement.” Id. The Court noted that the plan to manufacture, import, market, and sell the EO products described in the ANDA was undoubtedly a cooperative venture, and Cipla was to manufacture and sell infringing EO products to Ivax for resale in the United States. It concluded that under the standards for inducement, Cipla had therefore actively induced the acts of Ivax that will constitute direct infringement upon approval of the ANDA, and it was thus not inappropriate for the district court to include Cipla within the scope of the injunction.

In so concluding, the Court acknowledged that Cipla had not committed any current act of infringement by the mere act of providing data for obtaining FDA approval. However, noted the Court, just as Ivax will be liable for, and hence was being enjoined from, the commercial exploitation of escitalopram when it is approved by the FDA and during the life of the ’712 patent, so should Cipla be enjoined. The Court added that it was true that section 271(e)(2) defined Ivax’s filing of its ANDA as an infringement, and Cipla did not file the ANDA; however, when the question of an injunction against commercial activity arises, Cipla was as culpable as Ivax, and hence should be enjoined.

Judge Schall agreed with the Court insofar as it affirmed the district court’s judgment with respect to validity and modified the scope of the injunction issued by the district court. However, he dissented insofar as the Court affirmed the district court’s entry of an injunction as to Cipla. He reasoned that although section 271(e)(2) makes the filing of an ANDA an act of infringement and section 271(e)(4)(B) provides for injunctive relief against such an infringer, section 271(e)(1) exempts all uses of patented inventions that are reasonably related to the development and submission of any data to the FDA. He thus concluded that because Cipla had only provided information to Ivax for submission to the FDA, no basis existed for any cause of action under section 271(e)(2) against Cipla.