Endo Pharms. Inc. v. Actavis, Inc. (Fed Cir)

by Robins Kaplan LLP
Contact

Case Name: Endo Pharms. Inc. v. Actavis, Inc., Nos. 2013-1658, -1662, 2014 U.S. App. LEXIS 5879 (Fed. Cir. Mar. 31, 2014) (Circuit Judges Newman, Dyk, and Moore presiding; Opinion by Moore, J.; Dissent-in-part by Dyk) (appeal from S.D.N.Y., Griesa, J.)

Drug Product and Patent(s)-in-Suit: Opana® ER (oxymorphone); U.S Patent Nos. 8,309,122 (“the ’122 patent”), 8,329,216 (“the ’216 patent”), 7,851,482 (“the ’482 patent”)

Nature of the Case and Issue(s) Presented: Prior to this litigation, Endo sued defendants for patent infringement based on their ANDAs to market generic versions of Opana ER. The first set of lawsuits settled after Endo granted to defendants a license and a covenant not to sue. The settlement and license agreement between Endo and Roxane (Roxane Agreement) defines “Licensed Patents” as follows: (a) any [U.S.] patents that are both (i) now owned by Endo…and (ii) issued as of the Effective Date of this Agreement, including the Opana ER Patents, (b) any [U.S.] patent applications that claim priority to the Opana ER Patents, including any continuation, continuation-in-part and divisional patent applications that claim priority to Opana ER Patents, and (c) any patents resulting from the reissue or reexamination of patents or patent applications comprised within clauses (a) and (b)…. Pursuant to the agreement, Endo granted Roxane a covenant that it would not assert that Roxane’s generic versions of Opana ER infringe the licensed patents and a license under the licensed patents to make, use, have made, sell, offer to sell, import and use those generic products. Finally, the Roxane Agreement includes a “No Implied Rights” provision stating that Endo does not grant to Roxane any license or right “whether by implication, estoppel or otherwise, other than as expressly granted herein.” The settlement and license agreement between Endo and Actavis (Actavis Agreement) is similar.

The patents-in-suit issued after Endo’s agreements with defendants. Endo again sued defendants for patent infringement and moved for a preliminary injunction. Defendants opposed on the theories of express license and implied license by reason of legal estoppel. The court held that “as a matter of law…Endo is estopped from claiming that the activity of Actavis and Roxane, which has gone on for a substantial period of time, is now suddenly barred because of these new patents. The court therefore denied Endo's motions. Endo appealed and the Federal Circuit vacated the district court’s judgment and remanded the case.

Why Endo Prevailed:  The Federal Circuit found that Roxane’s express license arguments were meritless. The Roxane Agreement covers U.S. patent applications that “claim priority to the Opana ER Patents, including any continuation, continuation-in-part and divisional patent applications that claim priority to Opana ER Patents.” There can be no dispute that the ’122 and ’216 patents are not continuations of any of the licensed patents. Likewise, there is no reasonable argument that the ’122 and ’216 patents claim priority to any of the licensed patents. The Actavis Agreement likewise does not cover the ’122, ’216, and ’482 patents-in-suit in the Actavis appeal. It contained the same “continuations, continuations-in-part or divisionals” language as the Roxane Agreement. Because the asserted patents are not continuations, continuations-in-part, or divisionals of the licensed patents, they are also not covered. Finally, the ’482 patent is completely unrelated to any of the previously licensed patents, and is likewise not covered by the agreement. Therefore, the Federal Circuit found that defendants did not have an express license to practice any of the patents-in-suit.

Concerning defendants’ implied license argument, the Federal Circuit held that the district court erred as a matter of law in finding legal estoppel in favor of Actavis and Roxane. A patent license does not convey to the licensee “an absolute right” to make, use, or sell a product “because not even the patentee…is given that right.” The doctrine of legal estoppel does not nullify this general principle. Moreover, Federal Circuit precedent establishes that a license or a covenant not to sue enumerating specific patents may legally estop the patentee from asserting continuations of the licensed patents in the absence of mutual intent to the contrary. Put plainly, “[y]ou get what you bargain for[, a]nd we will not use the implied license doctrine to insert ourselves into that bargain and rewrite the contract.” Endo was not estopped from asserting the patents-in-suit because none of the asserted patents is a continuation of any of the licensed patents. The only familial relationship between the asserted and licensed patents was that the ’122 and ’216 patents claimed priority to the same provisional application as the ’250 patent. That, however, did not make those patents continuations of the ’250 patent. And the ’482 patent was not related to any of the licensed patents.

Endo granted to defendants a license and covenant not to sue limited to specific patents and patent applications. If defendants wanted to market and sell their accused generic products free from any threat of being sued by Endo for patent infringement, they could have negotiated for the appropriate language in the settlement and license agreements. Having agreed to licenses that do not cover the patents-in-suit, the Federal Circuit explained, defendants cannot not now be heard to complain.

Judge Dyk’s dissent-in-part concerns the question of whether Actavis had an implied license to the ’122 and ’216 patents. At the time of their settlement agreement, Endo owned those patent applications, which claimed priority to the same provisional application that provided priority to a patent covered by the settlement agreement (the ’250 patent). During the settlement negotiations, Endo did not disclose the ’122 and ’216 patent applications, but rather licensed Actavis to produce the product at issue here. Furthermore, Judge Dyk found that there were material differences between the Actavis and Roxane agreements and negotiations. Under those circumstances, he concluded that Actavis had an implied license to practice the ’122 and ’216 patents.

Written by:

Robins Kaplan LLP
Contact
more
less

Robins Kaplan LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
Feedback? Tell us what you think of the new jdsupra.com!