1. INTERESTING AND PENDING DECISIONS FROM THE FEDERAL CIRCUIT JANUARY, 2004 Nanette S. Thomas Senior Intellectual Property Counsel Becton Dickinson and Company Franklin Lakes, NJ 07417

2. 2 Table of Contents Interesting Decisions Slide Number Inequitable Conduct: Ulead Systems v. Lex Computer 3 Infringement Exemptions: Integra LifeSciences v. Merck (§271(e)(1))5 Bayer AG v. Housey Pharm (§271(g))6 Madey v. Duke University (Research)8 Unjust Enrichment: Univ. of Colorado v. American Cyanamid9 Pending Decisions Patent Term Extension: Pfizer v. Reddy11 Willful Infringement: Knorr-Bremse Systeme v. Dana12

3. 3 Inequitable Conduct Ulead Systems Inc. v. Lex Computer & Mgmt. Corp. (Fed. Cir. Dec. 9, 2003) “Historically issues of unenforceability have arisen in cases involving inequitable conducting occurring in the prosecution of patents. But, we see no reason why the doctrine [of enforceability] should not extend into other contexts, like the present one, where the allegations is that inequitable conduct has occurred after the patent has issued and during the course of establishing and paying the appropriate maintenance fees.”

4. 4 Inequitable Conduct Ulead Systems Inc. v. Lex Computer & Mgmt. Corp. (Fed. Cir. Dec. 9, 2003) Lex filed an affidavit of small entity status and paid reduced fees unaware of the existence of the licenses that caused the loss of small entity status. The Federal Circuit, inter alia, vacated and remanded the district court’s summary judgment because the evidence before the district court raises genuine issues on the question of intent for inequitable conduct.

5. 5 Infringement Exemption: §271 (e)(1) Integra LifeSciences. I, Ltd. v. Merck KGaA, 331 F.3d 860 (Fed. Cir. 2003) Merck’s use of Integra’s patented peptide in experiments to identify the best drug candidate, which would be subject to future clinical testing under the FDA process, did not come within the statutory safe harbor §271 (e)(1). “Therefore, the 271(e)(1) safe harbor covers those pre- expiration activities ‘reasonably related’ to acquiring FDA approval of a drug already on the market.” Merck filed petition for Panel Rehearing and Rehearing En Banc on July 21, 2003

6. 6 Infringement Exemption: §271 (g) Bayer AG v. Housey Pharms., Inc., 340 F.3d 1367 (Fed. Cir. 2003) Bayer brought a declaratory judgment action seeking, that Housey’s patents, which covered methods of screening compounds to determine their potential as drug products, were not infringed under §271 (g) and Housey counterclaimed for infringement. Bayer’s products and data imported into the US were identified overseas, but not made by Housey’s patents and §271 (g) did not apply. The Federal Circuit affirmed the district court’s dismissal of Housey’s infringement claims.

7. 7 Infringement Exemption: §271 (g) Bayer AG v. Housey Pharms., Inc., 340 F.3d 1367 (Fed. Cir. 2003) The court interpreted §271(g) to be limited to “made by a process patented in the United States [and] it must have been a physical article that was manufactured”; and that “processes of identification and generation of data are not steps in the manufacture of a final drug product.”

8. 8 Infringement Exemption: Judicially Created Experimental Defense Madey v. Duke University, 307 F.3d 1351 (Fed. Cir. 2002), cert. Denied, 123 S.Ct. 2639 (2003) “In short, regardless of whether a particular institution or entity is engaged in an endeavor for commercial gain, so long as the act is in furtherance of the alleged infringer’s legitimate business and is not solely for amusement, to satisfy idle curiosity, or for strictly philosophical inquiry, the act does not qualify for the very narrow and strictly limited experimental use defense. Moreover, the profit of non-profit status of the user of the user is not determinative.”

9. 9 Unjust Enrichment University of Colorado Foundation v. American Cyanamid Co., 342 F.3d 1298 (Fed. Cir. 2003). The Federal Circuit affirmed an award of unjust enrichment against Cyanamid for wrongful use of Doctor’s research results to obtain a patent and use a patent for incremental profits under Colorado law.

10. 10 Unjust Enrichment University of Colorado Foundation v. American Cyanamid Co., 342 F.3d 1298 (Fed. Cir. 2003). The Federal Circuit held that federal patent law does not preempt the unjust enrichment claim: “Here, although federal patent law plainly does not provide for explicit pre-emption, 35 U.S.C. Sections 1- 376 (2000), a state may not offer patent-like protection to intellectual creations that would otherwise remain unprotected as a matter of federal law.”

11. 11 Patent Term Extension: 35 U.S.C. §156 Pfizer Inc. v. Dr. Reddy’s Laboratories Ltd (67 U.S.P.Q. 1525) (Unpublished) “The crux of this case is whether Pfizer’s Patent Term Extension…Include[s] amlodipine and all of its salts [besylate and maleate], and therefore the products that Dr. Reddy seeks to market. Or if the extension only includes amlodipine besylate, the Norvasc product.” The court found that the only product within the scope of the PTE is amlodipine desylate, the active ingredient in Norvasc and dismissed the complaint. Appeal was filed to the Federal Circuit and the arguments were heard on July 9.

12. 12 Willful Infringement Knorr-Bremse Systeme Fuer Nutzfahzeuge GMBH v. Dana Corp., 344 F.3d 1336 (Fed. Cir. 2003) (en banc) The Federal Circuit, sua sponte, has decided to take this case en banc to reconsider its precedent concerning the drawing an adverse inference where the accused infringer did not obtain an opinion of counsel or, if one was obtained, it was not introduced into evidence.

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