08/12/2014

Abbvie Deutschland GMBH & Co. v. Janssen Biotech, Inc.: Board Decision Not Final for Collateral Estoppel


Category: Civil Procedure   
 
 
 
 By: John Kirkpatrick, Contributor
 
TitleAbbVie Deutschland GMBH & Co. v. Janssen Biotech, Inc., No. 2013-1338, 1346 (Fed. Cir. July 1, 2014).
Issues
[1] AbbVie argues that Centocor’s [(Jannsen's)] invalidity defenses as to [U.S. Patent 6,914,128] should not have been tried to the jury because of the preclusive effect of the [Board of Patent Appeals and Interferences'] prior judgment.
AbbVie at *14 (text added).
[2] [W]hether the ['128 patent] sufficiently otherwise describe[s] representative species to support the entire genus.
Id. at *22-23 (text added).
[3a] [T]hat the district court’s exclusion of the interference file history from evidence allowed Centocor to relitigate invalidity [for lack of written description support] from a clean slate.
Id. at *28 (text added).
[3b] [T]hat the district court erred in excluding expert testimony on the detailed reasoning of the PTO on the issues of written description, enablement, and obviousness during ex parte prosecution.
Id. at *28 (text added).
[3c] [T]hat the prejudicial effect of the contested evidentiary rulings was exacerbated by the jury instruction that new information presented at trial that was not considered by the PTO would make it easier for Centocor to carry its burden of proving invalidity by clear and convincing evidence.
Id. at *30 (text added).
Holdings
[1] Because a district court can make a de novo determination of facts upon the submission of new evidence, a Board decision that is reviewed under [35 U.S.C. § 146 (2006)] is not a “binding final judgment” to preclude a losing party from litigating the same or related issues in a parallel proceeding.
AbbVie at *16-17 (text added).
[2] [M]erely drawing a fence around a perceived genus is not a description of the genus. One needs to show that one has truly invented the genus, i.e., that one has conceived and described sufficient representative species encompassing the breadth of the genus.
Id. at *23 (text added).
[3a] [W]e need only address whether the evidentiary rulings affected AbbVie’s substantive rights concerning [the verdict for lack of written description support]. The evidence of the interference or other proffered evidence concerning obviousness is of little probative value to the written description determination.
Id. at *28 (text added).
[3b] In view of the record as a whole, including the substantial evidence of structural differences between Stelara [(the alleged infringing drug patented by Centocor)] and the antibodies [of AbbVie's patents] and the fact that the jury considered the number of structurally similar antibodies disclosed in AbbVie’s patents, [...] the district court did not abuse its discretion in excluding [testimony that the PTO concluded that the written description requirement was met.]
Id. at *30 (text added, internal citations removed).
[3c] “[I]f the PTO did not have all material facts before it, its considered judgment may lose significant force” and that “the challenger’s burden to persuade the jury of its invalidity defense by clear and convincing evidence may be easier to sustain.” [...] "[T]he jury may be instructed to evaluate whether the evidence before it is materially new, and if so, to consider that fact when determining whether an invalidity defense has been proved by clear and convincing evidence."
Id. at *32 (text added, quoting Microsoft Corp. v. i4i Ltd. Partnership, 131 S.Ct. 2238, 2251 (2011)).
 
 
 
Procedural History[AbbVie appeals] the final judgments of the [U.S.] District Court for the District of Massachusetts in [patent infringement and interference actions]. [...] AbbVie sued [Centocor] for infringement of [claim 29 of the’128 patent]. [...] Centocor sought [...] review under [§ 146] of the decisions of the [Board] in an interference between [Centocor's] U.S. Patent Application 10/912,994 [...] and AbbVie’s ’128 patent, in which the Board awarded priority to AbbVie and held that the contested claims in the ’128 patent were not invalid for obviousness. After a trial on validity in the infringement action, the jury determined that all of the asserted claims were invalid on the grounds of written description, enablement, and obviousness. The district court denied AbbVie’s post-trial motions for judgment as a matter of law (“JMOL”), and in the alternative, for a new trial.
AbbVie at *3 (text added, footnotes removed).
 
 
Legal Reasoning (LOURIE, O'Malley, Chen)
Background
Representative Claim LanguageClaim 29 of the ’128 patent is representative and reads as follows:

29. A neutralizing isolated human antibody, or antigen-binding portion thereof that binds to human IL-12 and disassociates from human IL-12 with a koff rate constant of 1x10-2 s-1 or less, as determined by surface plasmon resonance.

AbbVie at *7 (internal citation removed).
First Circuit Law Applies[W]e apply the law of the regional circuit “to which district court appeals normally lie, unless the issue pertains to or is unique to patent law.” [...] Accordingly, we apply the law of [...] the First Circuit, in reviewing the grant or denial of [AbbVie's motions] and challenges to [the] district court’s evidentiary rulings and jury instructions.
Id. at *13 (text added, internal citations removed).
[1] Collateral Estoppel
Applicable Legal Standards
Collateral Estoppel Factors[C]ollateral estoppel is a question of law reviewed de novo. [...] A party [...] must establish that: (1) the issue sought to be precluded in the later action is the same as that involved in the earlier action; (2) the issue was actually litigated; (3) the issue was determined by a valid and binding final judgment; and (4) the determination of the issue was essential to the judgment.
AbbVie at *14 ( text added, internal citations removed).
Consideration of Evidence Under § 146[§ 146] provides, in part, that “[a]ny party to an interference dissatisfied with the decision of the [Board] on the interference, may have remedy by civil action, [...]” and that “the record in the [PTO] shall be admitted on motion of either party [...] and the further cross-examination of the witnesses as the court imposes, without prejudice to the right of the parties to take further testimony.” [...] When additional evidence is presented, the district court makes a de novo finding of facts in light of the new evidence, “while treating the record before the Board when offered by a party as if it was originally taken and produced in the district court.”
Id. at *15 (text added, internal citation removed, emphasis removed).
Board’s Judgment Was Not Final for Collateral EstoppelAbbVie contends that although [...] Centocor could present new evidence [in the § 146 action], it remained a proceeding to review the Board’s decision and thus was akin to an appeal [and] did not impair the finality of the Board’s judgment.
Id. at *14 (text added).
 [T]he Board’s judgment was not a final judgment for purposes of collateral estoppel because the interference action under § 146 was still pending[.] [T]he factual record remains open with respect to the issues contested at the PTO [...] subject to a de novo determination by the district court. Consequently, the Board’s priority and nonobviousness decisions lacked the requisite finality for purposes of collateral estoppel.
Id. at 14-17 (text added, footnote removed).
[2] Motion for JMOL as to Written Description
Applicable Legal Standards
JMOL[T]he denial of a motion for JMOL [is reviewed] de novo [and] is appropriate when “a reasonable jury would not have a legally sufficient evidentiary basis to find for the party on that issue.” [...] [A]ll reasonable inferences that may be drawn [from the evidence presented to the jury are considered] in the light most favorable to the jury verdict. [...] We will only reverse [...] “if the facts and inferences point so strongly and overwhelmingly in favor of the movant that a reasonable jury could not have reached a verdict against that party.”
AbbVie at *18-19 (text added, internal citations removed, footnote removed).
Review of Written Description Determination by Jury[W]e review a jury’s factual determination relating to compliance with the written description requirement for substantial evidence. [...] Furthermore, patents are presumed to be valid, and overcoming this presumption requires clear and convincing evidence.
Id. at *19 (text added, internal citations removed).
Evaluating the Adequacy of the Disclosure for Generic Claims“[T]he specification must demonstrate that the applicant has made a generic invention that achieves the claimed result and do so by showing that the applicant has invented species sufficient to support a claim to the functionally-defined genus.” [...] “[A] sufficient description of a genus . . . requires the disclosure of either a representative number of species falling within the scope of the genus or structural features common to the members of the genus so that one of skill in the art can ‘visualize or recognize’ the members of the genus.”
Id. at *22 (text added, internal citations removed).
AbbVie's Disclosure Is Not Representative of the Entire Genus[A]nalogizing the genus to a plot of land, if the disclosed species only abide in a corner of the genus, one has not described the genus sufficiently to show that the inventor invented, or had possession of, the genus. [...] That is the case here. [...] [M]erely drawing a fence around a perceived genus is not a description of the genus. One needs to show [...] that one has conceived and described sufficient representative species encompassing the breadth of the genus. Otherwise, one has only a research plan. [...] Here, the jury heard ample evidence that AbbVie’s patents only describe one type of structurally similar [Joe-9] antibodies [that] are not representative of the full variety or scope of the genus. [...] Centocor’s Stelara, which falls within the scope of the claimed genus, differs considerably from the Joe-9 antibodies described in AbbVie’s patents. [...] [T]he described species are all of the similar type and do not qualitatively represent other types of antibodies encompassed by the genus. [...] AbbVie’s patents need not describe the allegedly infringing Stelara in exact terms. [...] However, the patents must at least describe some species representative of antibodies that are structurally similar to Stelara. [There] is also no evidence to show whether one of skill in the art could make predictable changes to the described antibodies to arrive at other types of antibodies such as Stelara.
Id. at *23-25 (text added, internal citations removed).
[3] New Trial
Legal Standard Is Abuse of DiscretionThe First Circuit reviews the denial of a motion [and] [c]hallenges to a district court’s evidentiary rulings [...] under an abuse of discretion standard.
AbbVie at *27 (text added, internal citations removed).
Interference History of Little Probative Value to Written Description[3a] AbbVie asserts that it was unfairly precluded from using the [interference] file history to demonstrate that much of Centocor’s case was cumulative of what the PTO had already considered. [...] Because we hold that substantial evidence supported the jury verdict of invalidity for lack of written description support, we need only address whether the evidentiary rulings affected AbbVie’s substantive rights concerning that verdict. The evidence of the interference or other proffered evidence concerning obviousness is of little probative value to the written description determination. [...] Moreover, as indicated, the interference did not collaterally estop Centocor from presenting invalidity defenses in the infringement action and thus the court properly excluded evidence of Centocor’s participation in the interference.
Id. at *28 (text added).
Excluded Testimony Merely Summarizes Arguments Made to the PTO[3b] We also find no reversible error in the [...] exclusion of [...] testimony on the detailed reasoning of the PTO. [...] [Based on the expert's report,] the proffered testimony likely would summarize prosecution arguments made to the PTO. [...] In view of the record as a whole, including the substantial evidence of structural differences between Stelara and the Joe-9 antibodies and the fact that the jury considered the number of structurally similar antibodies disclosed in AbbVie’s patents, [...] the district court did not abuse its discretion.
Id. at *29 (text added, internal citations removed).
The Jury Instruction Reasonably Apprised the Jury[3c] [AbbVie argues that the district court] refused to instruct the jury that the new information must be more relevant than information considered by the PTO [and,] that the district court erred in interpreting the "materially new" phrase in Microsoft v. i4i and incorrectly instructed the jury on “materiality” using a “reasonable examiner” standard. [...] [W]e need only address [...] reversible error with respect to the jury’s written description verdict. [...] Concerning [Centocor's relevant testimony,] the alleged errors are not sufficiently prejudicial to warrant a new trial. [...] The district court rephrased “materially new” in its jury instruction as “additional information [that] would have been ‘material’ to the PTO’s decision to grant the patents.” [...] The district court then instructed the jury that information is “material” if “there is a substantial likelihood that a reasonable patent examiner would consider it important in deciding whether to allow the application to issue as a patent” [and] “if the additional information was not material, or it would not have carried significant weight, Centocor’s burden may be more difficult to meet.” [...] Taken as a whole, the jury instruction reasonably apprised the jury on weighing evidence relevant to the written description issue.
Id. at 30-32 (text added, internal citations removed, emphasis removed).
Conclusion
[1] We conclude that because the interference action under § 146 was pending at the district court, the Board’s decision lacked the requisite finality for purposes of collateral estoppel.
AbbVie at *4.
[2] We also hold that record evidence sufficiently supported the jury verdict that the asserted claims lacked adequate written description under 35 U.S.C. § 112, ¶ 1 (2006).
Id. (footnote removed).
[3] We further find no reversible error in the contested evidentiary rulings and jury instructions relating to the issue of written description sufficient to warrant a new trial.
Id. at *4-5.
 
 
 
 
O’MALLEY, Circuit Judge, concurring in judgment. AbbVie, O'Malley Op., at *1.
I agree that Centocor was not collaterally estopped from raising invalidity defenses in this infringement action by virtue of the Board’s prior finding that the relevant claims in the ’128 patent were not invalid as obvious. I also agree that we should affirm the trial court’s judgment invalidating the asserted claims [...]. I would premise the latter judgment on the lower court’s obviousness finding however, a finding from which AbbVie does not appeal. [...] [B]ecause AbbVie did not appeal the district court’s finding of obviousness, our decision on the jury instruction issue controls the outcome of this case. [...] [W]e cannot [...] address the jury instruction error alleged only as it applies to the written description judgment. [...] Because both parties agree that our evaluation of AbbVie’s challenge to the jury instruction regarding Centocor’s burden of proof on all of its validity challenges is determinative of errors alleged, I would assess that jury instruction, determine whether it is legally accurate and, if not, whether it was prejudicial.
AbbVie, O'Malley Op. at *2-4 (text added, internal citations removed).
 
 
 
 
 
 
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