Federal Circuit Summaries

Before PROST, WALLACH, and TARANTO. Appeal from the District of Delaware

Summary: (1) A party may not avoid inducement based on “substantial non-infringing uses,” and (2) prosecution history estoppel does not apply to a narrowing amendment in a parent application that was not present in the patent-in-suit.

Sanofi sued Watson and Sandoz for infringement of the ‘167 and ‘800 patents. The district court found that Watson and Sandoz induced infringement of the ‘167 patent based on their proposed drug labels, which contained an indication for reducing the risk of hospitalization in certain conditions. The district court also found Watson and Sandoz infringed the ‘800 patent after rejecting their argument that prosecution history estoppel applied. Watson and Sandoz appealed to the Federal Circuit.

Watson and Sandoz argued they did not induce infringement of the ‘167 patent because their drugs had substantial non-infringing uses that were not forbidden by their labels. The Federal Circuit disagreed. Unlike contributory infringement, inducement does not contain a “substantial non-infringing use” restriction. Because the labels encouraged an infringing use, that was sufficient for inducement even if the drugs could be used in non-infringing ways.

The Federal Circuit also rejected Watson’s and Sandoz’s argument that prosecution history estoppel applied to the ‘800 patent. Sanofi had added a narrowing limitation to the claims of a parent application, but removed it from the application that became the ‘800 patent. The Federal Circuit held that prosecution history estoppel did not apply because Sanofi merely obtained “immediate issuance of a patent containing narrowed claims and postpone[d] to the prosecution of a continuation application further arguments about claims that lack the narrowing limitation.” Thus, the Federal Circuit affirmed.

This case is: SANOFI, SANOFI-AVENTIS U.S., LLC V. WATSON LABS. INC., SANDOZ, INC.