In a recent decision, the Ninth Circuit addressed the antitrust implications of so-called "reverse payments" between brand name and generic pharmaceutical companies.  A health care provider brought suit against the two companies, alleging their agreement to delay the introduction of a generic pharmaceutical (which involved payment to the generic manufacturer of $4.5 million per month) was a violation of antitrust laws that caused the provider to have to pay substantially more to obtain the pharmaceutical.  The provider also alleged the brand name pharmaceutical company filed for and obtained patents it knew were invalid and engaged in sham litigation to unlawfully extend its patent monopoly over the pharmaceutical.  The provider lost on both counts at the district court.  A jury found the agreement between the two providers had not caused a delay in the introduction of the generic, and the district court granted summary judgment on the attempted monopolization claim based on fraudulent filings.

The Ninth Circuit affirmed and reversed in part.  The court affirmed the jury's verdict on the unlawful restraint of trade (§ 1 of the Sherman Act) claim, holding the district court's evidentiary decisions were not an abuse of discretion.  As to the summary judgment on the monopolization claim under § 2, the court agreed there was insufficient evidence that the brand-name manufacturer's litigation to prevent the introduction of the generic was a sham.  But, the Ninth Circuit held there was sufficient evidence to overcome summary judgment that one of the patents asserted in those cases was obtained by fraud, and remanded the case for further consideration of the § 2 claim under Walker Process.

More on Kaiser Found. Health Plan, Inc. v. Abbot Labs., Inc. after the jump.

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In a decision Tuesday, the Federal Circuit affirmed a district court's holding that two patents were invalid under the on-sale bar of 35 U.S.C. § 102(b).  The inventor filed a declaration during prosecution that the invention was reduced to practice before the critical date of the patents, and thereafter sold the claimed method, also before the critical date.  The post-reduction to practice sales could not be considered experimental use, as once an invention is reduced to practice, experimental use is no longer possible.  Further, there was insuffucient evidence to call the inventor's declaration into question.  On this point, the plaintiff attempted to rely upon additional evidence not presented to the district court in opposition to the defendants' summary judgment motion.  The Federal Circuit rebuffed this attempt, limiting the plaintiff on appeal to the evidence presented to the district court in opposition to the summary judgment motion.  As a result, the court affirmed the finding of invalidity.

The Federal Circuit further affirmed the district court's dismissal of the plaintiff's trade secret claims as barred under the statute of limitations.  The court held the plaintiff had sufficient information to allege trade secret misappropriation at least as early as 1996, but did not file suit until 2005, well outside the applicable 3-year limitations period.  Accordingly, dismissal of the trade secret claims was proper.

More concerning In re Cygnus Telecomms. Tech., LLC, Patent Litig. after the jump. 

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In a decision Thursday, the Federal Circuit provided additional guidance on the on-sale bar of § 102(b).  In the case, the patentee developed a series of prototypes that were then sold to its customer, who then experimented with the prototypes and requested modifications to the prototypes.  The prototypes were also accompanied by offers to sell production models of the prototypes.  The court was clear in that the experimental use exception only concerns the actions of the inventors and their agents, not another party doing experimental testing for a particular purpose.  As a result, despite the fact that the customer was experimenting with the prototypes, that experimentation could not negate the on-sale bar of § 102(b).

Two of the panel's three judges also filed a concurring opinion.  In that opinion, Judges Prost and Dyk "point out the confusion" in Federal Circuit law when it comes to the interaction between experimental use and the on-sale bar.  While this case is not the proper vehicle, it's safe to add this issue to the list of near-future en banc issues for the court.

More detail of Atlanta Attachment Co. v. Leggett & Platt, Inc. after the jump.

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In a decision Friday, the Federal Circuit vacated in part a district court's claim construction of a several terms as well as its decision to find no infringement of patents owned by Honeywell.  The court did, however, affirm the district court's retention of jurisdiction over the several withdrawn claims and the decision that Honeywell's pre-critical date activities were not barring sales or public uses under § 102(b).

More details of Honeywell Int'l Inc. v. Universal Avionics Sys. Corp. after the jump.

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What do Dippin' Dots, the little beads of ice cream sold at fairs, stadiums, and malls, have to do with patent and antitrust law? For the Federal Circuit, they presented the "close case" where a patent holder can be found to have engaged in inequitable conduct during prosecution of the patent but is not liable for a Walker Process antitrust claim by an infringement defendant. This is possible based on the differing standards of proof required by the infringement defendant, as explained by the Federal Circuit in the case. While both inequitable conduct and a Walker Process antitrust claim require proof that the patent holder either misrepresented or failed to disclose to the patent office something material to patentability and that it was done with intent to deceive. However, if evidence of one is scant, an inequitable conduct claim can still be proven if evidence of the other is strong; not so with a Walker Process claim. More details of the case after the jump.

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