MYLAN INSTITUTIONAL LLC v. AUROBINDO PHARMA LTD: May 19, 2017. Before Lourie, Moore and Reyna.

Takeaway:

  • CAFC ruled the district court did not err in granting preliminary injunction because the district court correctly determined defendant was unlikely to prove invalidity of one patent-in-suit, even though the district court did err in determining plaintiff was likely to infringe two additional “process” patents-in-suit under the doctrine of equivalents.
  • CAFC also suggested that courts should consider whether to apply the “insubstantial differences” test for infringement under the doctrine of equivalents in chemical cases instead of the “function-way-result” test.

Procedural Posture:

On appeal from E.D. Tex., the CAFC reviewed the district court’s grant of a preliminary injunction precluding defendant Aurobindo from making, using, selling, offering to sell, and importing the accused isosulfan blue (“ISB”) product that allegedly infringes three of plaintiff’s patents—U.S. Patent 7,622,992 (“the ’992 patent”), U.S. Patent 8,969,616 (“the ’616 patent”), and U.S. Patent 9,353,050 (“the ’050 patent”). CAFC affirmed, but modified the injunction to be based only upon the ’050 patent.

Synopsis:

  • Infringement – Doctrine of Equivalents: The CAFC held that the district court erred when it found the ’616 and ’992 “process” patents were likely infringed under the doctrine of equivalents based on the function-way-result (“FWR”) test. The Supreme Court has set out two frameworks for evaluating equivalence, the FWR test (whether the accused product performs “substantially the same function in substantially the same way to obtain the same result”) and the insubstantial differences test (whether the accused product or process is substantially different from what is patented). The CAFC noted that the FWR test may not be suitable for use in cases considering non-mechanical inventions, such as patents claiming chemical compositions, compounds, or processes, because in such cases “it is often not clear what the ‘function’ or ‘way’ is for each claim limitation.” The CAFC found that when applying the FWR test, either the district court did not address the “way” prong for the FWR analysis or it performed this analysis without considering critical factors such as the relative oxidation strengths of silver oxide (used in the claimed process) and manganese dioxide (used in the accused process), as well as the use of an acid in the accused process. As a result, the CAFC found there is room “for sufficient doubt as to whether silver oxide and manganese dioxide oxidize isoleuco acid in the same way so as to satisfy the ‘way’ prong of the FWR test.” The CAFC also applied the insubstantial differences test and came to the same conclusion, because “[m]anganese dioxide and silver oxide are substantially different in many respects” that “may well be relevant to equivalence at trial.”
  • Invalidity – Anticipation, Obviousness, Indefiniteness: Because the defendant did not appeal the district court’s holding that it more likely than not infringes the ’050 patent-in-suit, the CAFC considered only whether the district court erred in ruling that the defendant failed to raise a substantial question as to the validity of this patent. With respect to anticipation, the CAFC agreed with the district court that the defendant failed to show a substantial question as to whether the ’050 patent claims were anticipated by Sigma’s manufacture and sale of its ISB product because the Sigma Certificate of Analysis for this product stated that the product related to a compound named “Patent Violet Blue,” and it was not clear that, at the time of the Certificate, Sigma used that term to refer to ISB. The CAFC also agreed with the district court that Aurobindo did not raise a substantial question as to obviousness based upon the motivation to combine references, a reasonable expectation of success in doing so, and secondary considerations of non-obviousness. Finally, the CAFC agreed with the district court that the allegations of indefiniteness did not raise a substantial question of validity because the evidence showed that the phrase “by HPLC” used in the patent claims was a “common and well understood way of designating purity in publications and patents that are relied upon by the scientific and technical community,” as found by the district court.
  • Injunctive Relief – Irreparable Harm: The CAFC held that the district court did not clearly err in holding that the plaintiff would be irreparably harmed absent a preliminary injunction. The evidence supported the district court’s finding of irreparable harm based on (1) plaintiff’s lost sales, lost research and development, price erosion, and having to compete with an infringer; (2) a causal nexus between the infringement and the harm, since the defendant’s competing product would not be on the market if the defendant had not obtained FDA approval; and (3) defendant would not have been able to produce the product approved by the FDA without infringing the ’050 patent.