Judges: Mayer, Schall (dissenting-in-part), Gajarsa (author)
[Appealed from E.D. Mo., Judge Sippel]
In In re Metoprolol Succinate Patent Litigation, No. 06-1254 (Fed. Cir. July 23, 2007), the Federal Circuit affirmed the district court’s holding of invalidity based on double patenting, but vacated its holding of inequitable conduct and remanded.
AstraZeneca AB, Aktiebolaget Hässle, and AstraZeneca LP (collectively “Astra”) manufacture and market metoprolol succinate in “extended release” forms under the brand name Toprol-XL®. Metoprolol is used in the treatment of angina, hypertension, and congestive heart failure.
In 1971, an Astra employee, Toivo Nitenberg, synthesized metoprolol succinate at Astra’s facilities in Sweden. In 1983, two Astra employees, Curt Appelgren and Christina Eskilsson, left Astra to join another company, Lejus Medical AB (“Lejus”), which filed a patent application with the Swedish Patent Office, describing “delayed and extended release dosage forms of pharmaceutical compositions, including metoprolol succinate” and naming Appelgren and Eskilsson as inventors. Slip op. at 3. Lejus subsequently filed U.S. Application Serial No. 690,197 (“the ’197 application”), claiming priority from the Swedish application. When Astra noticed the publication of the Swedish application, Astra commenced a transfer of ownership action with the Swedish Patent Office asserting that Nitenberg, not Appelgren and Eskilsson, invented metoprolol succinate. Astra and Lejus subsequently settled this ownership dispute. Lejus agreed to divide claims to “metoprolol succinate” and to a “pharmaceutical composition, characterized in that the active substance is metoprolol succinate” from the ’197 application and to assign the divided claims to Astra. Id. Astra agreed that Lejus retained the rights to the ’197 application that did not include the divided claims. The ’197 application subsequently issued as U.S. Patent No. 4,780,318 (“the ’318 patent”).
In accordance with the settlement agreement, Lejus filed U.S. Application Serial No. 172,897 (“the ’897 application”), which is a continuation-in-part of the ’197 application. Lejus named Appelgren and Eskilsson as inventors. Both before and after the filing of the ’897 application, Astra’s in-house counsel asserted to Lejus that Nitenberg, not Appelgren and Eskilsson, was the inventor of metoprolol succinate. Similarly, after Lejus transferred the prosecution of the ’897 application to Astra, Astra’s in-house counsel asserted that “there remains an open question who is the proper inventor.” Id. at 4. In March 1991, the ’897 application issued as U.S. Patent No. 5,001,161 (“the ’161 patent”). The only claim of the ’161 patent reads: “A pharmaceutical composition comprising metoprolol succinate together with a sustained release pharmaceutically acceptable carrier.” Id. In January 1992, a continuation of the ’897 application issued as U.S. Patent No. 5,081,154 (“the ’154 patent”), the only claim of which simply reads “Metoprolol succinate.” Id. The ’161 and ’154 patents both list Appelgren and Eskilsson as the inventors, and Astra as the assignee. Astra never revealed the inventorship issue to the PTO.
Astra filed multiple suits in various district courts asserting that the ANDAs filed by KV Pharmaceutical Company, Andrx Pharmaceuticals, LLC and Andrx Corporation, and Eon Labs, Inc., which were seeking approval to market generic versions of Toprol-XL®, infringed Astra’s ’161 and ’154 patents. The Judicial Panel on Multidistrict Litigation consolidated the suits in the U.S. District Court for the Eastern District of Missouri. All three defendants moved for SJ of invalidity of the ’161 and ’154 patents based on double patenting in view of Lejus’s ’318 patent and of unenforceability of the ’161 and ’154 patents based on Astra’s failure to notify the PTO of the inventorship dispute. The district court granted both motions. Astra appealed the grant of SJ of invalidity based on double patenting with respect to only the ’154 patent and the grant of SJ for unenforceability of both patents based on inequitable conduct.
On appeal, the Federal Circuit affirmed the district court’s holding of invalidity based on double patenting. The Court observed that the purpose of the nonstatutory or obviousness-type double patenting doctrine is “to prevent claims in separate applications or patents that do not recite the ‘same’ invention, but nonetheless claim inventions so alike that granting both exclusive rights would effectively extend the life of patent protection.” Id. at 8 (citation omitted). The Court stated that an obviousness-type double patenting analysis entails two steps: “First, as a matter of law, a court construes the claim in the earlier patent and the claim in the later patent and determines the differences. Second, the court determines whether the differences in subject matter between the two claims render the claims patentably distinct.” Id. (citation omitted).
Applying this two-part test, the Federal Circuit noted that the parties agreed with the district court’s claim constructions and that it did not perceive any error in the district court’s claim constructions. Therefore, the Court noted that the only issue on appeal regarding the invalidity of the ’154 patent is whether the district court correctly found the claims to be not patentably distinct. The Federal Circuit observed that the district court found that claim 8 of the ’318 patent “is directed to certain pharmaceutical compositions containing metoprolol succinate” and that the ’154 patent “broadly claims any pharmaceutical compositions containing metoprolol succinate.” Id. at 8-9. As a result, the district court concluded that the ’154 patent is a genus of the species claimed by the ’318 patent and that since the species claimed by the ’318 patent issued prior to the genus claimed by the ’154 patent, the ’154 patent was invalid for double patenting because it is not patentably distinct from claim 8 of the ’318 patent.
Astra argued that the district court erred in concluding that claim 8 of the ’318 patent and claim 1 of the ’154 patent recited a species/genus relationship and that the claims instead define an element/combination relationship. The Federal Circuit rejected this argument, however, stating that such disputes about the characterization of the relation between the two claims in a double patenting context are irrelevant. The Court observed that “Claim 1 of the ’154 Patent claiming a compound (A1) is an obvious variation of Claim 8 of the ’318 Patent claiming a composition compris[ing] of one compound of an enumerated list (A1, A2, A3, etc.), an inner layer (B), and an outer layer (C).” Id. at 10. It stated that “it would have been an obvious variation of Claim 8 of the ’318 Patent to omit the inner layer (B) and the outer layer (C).” Id.
The Court also rejected Astra’s argument that certain decisions of the Court of Customs and Patent Appeals, one of its predecessors, stand for the proposition that there is no double patenting because an earlier claim to a combination sets forth a later claimed element. The Court explained that while the cases cited by Astra do appear to support this proposition, a later issued decision by that same court refutes Astra’s argument and that this later issued decision controls because “the Court of Customs and Patent Appeals always sat in banc and therefore later decisions overcome earlier inconsistent ones.” Id. at 11 (citation omitted). In addition, the Court reasoned that “adopting Astra’s argument that there can never be ‘double patenting simply because a later claimed element is set forth in an earlier claim to the combination,’ . . . would require that this court eviscerate obviousness-type double patenting, thereby reducing invalidity based on double patenting to the § 101 statutory prohibition against claims of the same invention.” Id. at 12-13 (citation omitted). Accordingly, it affirmed the district court’s SJ holding that the ’154 patent is invalid over the ’308 patent for obviousness-type double patenting.
On the issue of inequitable conduct, the Federal Circuit found that the district court erred in holding on SJ that the ’161 and ’154 patents were unenforceable based on inequitable conduct. The Court focused its analysis on the district court’s finding of intent to deceive. It noted that the district court inferred intent to deceive based on an analysis of what could have happened if Astra had disclosed the inventorship dispute to the PTO. Relying on this “but for” analysis, the district court found by clear and convincing evidence that Astra’s motivation to not reveal the dispute was great based on the risk of losing its metoprolol inventions as anticipated by prior art and that the intent to deceive was clearly present. The Federal Circuit held that “[e]ven assuming arguendo that the patents at issue would have been invalid based on anticipation if Astra had disclosed the inventorship dispute to the U.S. Patent & Trademark Office, the district court erred in equating the presence of an incentive with an intent to deceive on summary judgment.” Id. at 16. The Court observed that because the deposition of Astra’s in-house patent counsel indicated that he did not know of and was not concerned about the incentives identified by the district court in its “but for” analysis, the record revealed a genuine factual dispute of whether Astra had an intent to deceive the PTO. The Court concluded that the district court incorrectly resolved this factual dispute on SJ and thus vacated the district court’s inequitable conduct finding and remanded.
Judge Schall agreed with the majority’s decision regarding inequitable conduct, but disagreed with its decision finding the ’154 patent invalid based on double patenting. In his view, claim 1 of the ’154 patent is patentably distinct from claim 8 of the ’318 patent. He stated that “[f]ar from claiming an obvious variation on the three-element composition claimed in the ’318 patent, the ’154 patent . . . lacks any semblance to the second two elements in the three-element composition of claim 8.” Schall Dissent at 4-5. He disagreed with the majority’s reading of the case law and opined that “the law is that there is no double patenting simply because a later claimed element is set forth in an earlier claim to a combination.” Id. He added that allowance of claim 1 of the ’154 patent to metoprolol succinate will not result in the improper extension of the patent for the invention claimed in the ’318 patent because in this case, “each patent is capable of being practiced by itself, without infringing the other.” Id. at 10.