"Advice Of Scientist" Defense To Walker Process
2008-1556 Braintree v. Schwarz Pharma
D/DE 03-477
Judge Sue Robinson
Schwarz Pharma ("SPI") appeals from the opinion of Judge Sue Robinson, following a bench trial, in favor of Braintree on SPI's counterclaims for unfair competition and Sherman Act violations.
Braintree initiated the action in 2003, asserting infringement of its 5,710,183 patent following SPI's ANDA submission to market GLYCOLAX®, a generic version of Braintree's MIRALAX®. Braintree dismissed with prejudice its infringement claims in 2004 (and waiving the remainder of the 30-month stay), and SPI's counterclaims of invalidity were dismissed as moot. The essence of the remaining SPI claims were that Braintree initiated the action knowing that the '183 was invalid.
Background. In the late 1980s Braintree attempted to obtain patent claims on polyethylene glycol 3350 ("PEG"), the chemical ingredient in Miralax. This attempt (the Fordtran application) was unsuccessful and the application was abandon.
In 1998--while Braintree's NDA for the use of PEG was pending--Braintree learned of a pending patent application by Dr. Halow (that became the '183) and was surprised that the claims had been allowed given its own unsuccessful efforts...and further because its earlier, abandoned Fordtran PCT and a 1990 article on PEG were not submitted to the PTO. Braintree's counsel contact Dr. Halow's counsel:
Per our discussions, you are aware that my client, Braintree Laboratories, Inc., is interested in obtaining option and licensing rights in [the '183 patent] ...
After evaluating the file history of this patent, we have concluded that, if this patent were to be reexamined by the USPTO, claim 33 (PEG alone) would be found invalid in view of the prior art (Fordtran PCT publication, W087000754[, et al.]). It is our opinion that claim 33 ... is directly anticipated by the claims of Fordtran let al.]....
With that being said, we also recognize that validity and claim scope can only be ultimately determined by the USPTO and the courts.
Braintree licensed claim 33 (the key claim) for $15,000. Braintree went on to obtain FDA approval for its NDA, listing the '183 in the Orange Book. By 2002 Braintree had become the assignee of the '183.
SPI. Shortly after SPI filed its ANDA for a generic PEG product, Braintree sued, asserting infringement of claim 33. However, less than a year later and following the deposition of Dr. Halow, Braintree voluntarily dismissed its claim with prejudice. Apparently Dr. Halow had, more than a year before filing the application, conducting clinical trials without having first obtained confidentiality agreements. At that time, a Federal Circuit panel had just issued SmithKline Beecham v. Apotex, 365 F.3d 1306 (Fed. Cir. 2004), holding such conduct to be non-experimental public use under 102(b) [this was later vacated en banc, 403 F.3d 1328 (Fed. Cir. 2005)].
Despite the dismissal, SPI persisted, claiming that Braintree knew or should have known claim 33 of the '183 was invalid for the same reasons that its counsel had written in the earlier letter--the Fordtran application and the article.
Judge Robinson, of course, analyzed the claim under the Noerr-Pennington Doctrine, which generally gives immunity to those petitioning the government for redress (like filing a lawsuit) unless the petition is a "sham." A "sham" requires a showing that the lawsuit was objectively baseless and, if so, clear and convincing evidence that it was subjectively brought to interfere with the defendant's business relationships.
The court ultimately concludes that, despite Braintree's doubts about the validity and its admission that the claim was "weak," there was at least a colorable argument that claim 33 could be construed so as not to be invalid.
The interesting part of Judge Robinson's opinion is the "advice of scientist" defense that Braintree advances--claiming that, despite its counsel's letter, it conducted a pre-suit investigation by consulting with various scientists who thought the claim valid over the prior art. The judge wrote:
Braintree did not waive its attorney-client privilege in this case by asserting an advice of counsel defense and, therefore, the nature of its counsel's advice remains unknown. To establish good faith in filing suit, but keep the nature of its communications with counsel confidential, Braintree has orchestrated an "advice of scientist" defense the immediate flaw of which is that these scientists' views were admittedly tainted, on some level, by the confidential advice of counsel.
The court also noted that during the scientists depositions, when asked about validity or invalidity, Braintree objected that the scientists were not attorneys and that their only knowledge on that issue would have come from attorneys.
Despite her recognition that Braintree was trying to rely on advice of counsel without disclosing that advice, she found that Braintree's arguments on claim construction good enough to be colorable.
Note: In this era of printing to pdf, why are the opinions in some courts, like this one, apparently scanned in? This makes the file (1) much bigger and (2) not text-searchable. I drastically shrunk the file size down to a mere 270+ kb, but the resolution is not great and it is still pretty big.
More reading:
Counsel:
Braintree: Fredrick L. Cottrell, III, Esquire and Steven J. Fineman, Esquire of Richards, Layton & Finger, P.A., Wilmington, Delaware. Counsel for Plaintiff and Counterclaim Defendant. Of Counsel: David B. Bassett, Esquire, Michelle D. Miller, Esquire, Cynthia D. Vreeland, Esquire, and Eric Mahr, Esquire of Wilmer Cutler Pickering Hale and Dorr,
LLP, Boston, Massachusetts.
SPI: Philip A. Rovner, Esquire of Potter Anderson & Corroon LLP, Wilmington, Delaware. Counsel for Defendant and Counterclaim Plaintiff. Of Counsel: Brian M. Poissant, Esquire, F. Dominic Cerrito, Esquire, Daniel L. Malone, Esquire, Jonathan A. Muenkel, Esquire and Eric Stops, Esquire of Jones Day, New York, New York, Michelle K. Fischer, Esquire of Jones Day, Cleveland, Ohio.
Comments