Duramed Pharmaceuticals v. Watson Laboratories (CAFC 2010-1331) insensibly nonprecedential

Preliminaries to clobbering '969.

This court reviews a district court's decision on summary judgment de novo, reapplying the same standard applied by the district court. Iovate Health Scis., Inc. v. Bio-Engineered Supplements & Nutrition, Inc., 586 F.3d 1376, 1380 (Fed. Cir. 2009). Summary judgment is appropriate only "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). In deciding a motion for summary judgment, "[t]he evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).

"[A] moving party seeking to have a patent held not invalid at summary judgment must show that the nonmoving party, who bears the burden of proof at trial, failed to produce clear and convincing evidence on an essential element of a defense upon which a reasonable jury could invalidate the patent." Eli Lilly & Co. v. Barr Labs., Inc., 251 F.3d 955, 962 (Fed. Cir. 2001). To defeat summary judgment, the nonmoving party must then come forward with evidence sufficient to establish a genuine issue of material fact regarding that essential element. Freedman Seating Co. v. Am. Seating Co., 420 F.3d 1350, 1363 (Fed. Cir. 2005).

Obzilla stalks the land, with men and women in black robes as his minions.

Under the Patent Act, "[a] patent may not be obtained . . . if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains." 35 U.S.C. § 103(a). Although the ultimate determination of obviousness under § 103 is a question of law, it is based on several underlying factual findings, including (1) the scope and content of the prior art; (2) the level of ordinary skill in the pertinent art; (3) the differences between the claimed invention and the prior art; and (4) evidence of secondary factors, such as commercial success, long-felt need, and the failure of others. Graham v. John Deere Co., 383 U.S. 1, 17-18 (1966).

Prior art hints and allegations lead to patent damnation. ~ the "Common Sense" Creed of Obzilla

An invention "composed of several elements is not proved obvious merely by demonstrating that each of its elements was, independently, known in the prior art." KSR Int'l Co. v. Teleflex Inc., 550 U.S. 398, 418 (2007). Rather, "it can be important to identify a reason that would have prompted a person of ordinary skill in the relevant field to combine the elements in the way the claimed new invention does," id., although such a reason need not be explicitly stated in the prior art, see id. at 419. Furthermore, when there exists a finite number of identified, predictable solutions to a known problem, a combination that results in "anticipated success" is likely the product not of innovation, but of ordinary skill and common sense. Id. at 421.

Such a lovely quote, even though old news, should carry the water of precedent.

Watson argued that it raised genuine issues of material fact. But the materials were all there.

There were more egregious errors by Nevada district court Judge Larry R. Hicks.

Specifically, the district court erred in assessing the content and scope of the prior art, leading it to incorrectly analyze each prior art reference in isolation without considering the prior arts' teaching as a whole in light of the creativity and common sense of a person of ordinary skill. The court also appears to have applied an incorrect evidentiary standard on summary judgment. Finally, the court failed to make any finding on the level of skill in the art.

A. Content and Scope of the Prior Art

Prior art references included two articles by Dr. Sulak.

The district court erred in several of its findings on the disclosure of the Sulak articles and the '749 patent, which then infected the court's summary judgment decision. Regarding Sulak, the court rejected all consideration of the articles' teaching of the use of unopposed estrogen because that use was mentioned only as a "theoretical," rather than a tested, solution to estrogen-withdrawal headaches. Duramed, 701 F. Supp. 2d at 1169. A reference, however, is prior art for all that it discloses, and there is no requirement that a teaching in the prior art be scientifically tested, see PharmaStem Therapeutics, Inc. v. ViaCell, Inc., 491 F.3d 1342, 1363-64 (Fed. Cir. 2007), or even guarantee success, see Alza Corp. v. Mylan Labs., Inc., 464 F.3d 1286, 1295 (Fed. Cir. 2006), before providing a reason to combine. Rather, it is sufficient that one of ordinary skill in the art would perceive from the prior art a reasonable likelihood of success. Id.

The district court failed to connect the dots.

Based on its errors in assessing the content of these prior art references, the district court improperly analyzed and rejected the teaching of each in isolation, concluding that each alone failed to establish by clear and convincing evidence a motivation to combine.

The district court didn't understand the evidentiary standard.

The district court also appears to have applied an incorrect evidentiary standard on summary judgment, incorrectly placing the burden of proof on the nonmoving party, Watson, to show clear and convincing evidence of invalidity as a matter of law. In this case, Duramed moved for summary judgment of nonobviousness, and thus the burden rested with Duramed to show that Watson had failed to come forth with clear and convincing evidence of an essential element of its prima facie case of obviousness. See Eli Lilly, 251 F.3d at 962. Although the ultimate evidentiary burden of showing clear and convincing evidence does not change on summary judgment, Watson could defeat summary judgment by showing a genuine issue of material fact, which, if believed by the finder of fact, could provide clear and convincing evidence of a motivation to combine the prior art references. See Freedman Seating, 420 F.3d at 1364; see also Monarch Knitting Mach. Corp. v. Sulzer Morat GmbH, 139 F.3d 877, 881 (Fed. Cir. 1998) ("If facts remain in dispute, this court weighs the materiality of the dispute, i.e., whether resolution of the dispute one way or the other makes a difference to the final determination of obviousness."). That is the standard the district court should have made clear it was applying on summary judgment.

B. Level of Skill in the Art

A determination of obviousness requires a factual finding of the level of ordinary skill in the pertinent art, 35 U.S.C. § 103(a); Graham, 383 U.S. at 17, which the district court failed to make in this case. When a finding of the level of skill affects the court's ultimate conclusion under § 103, the failure to make such a finding constitutes reversible error. See Kloster Speedsteel AB v. Crucible Inc., 793 F.2d 1565, 1574 (Fed. Cir. 1986), overruled on other grounds by Knoff-Bremse Systeme v. Dana Corp., 383 F.3d 1337 (Fed. Cir. 2004). The district court granted summary judgment of nonobviousness based on an unspecified level of skill, but a finding of a higher level of skill could have altered this ruling because, in general, an invention may be more obvious to one of higher skill than it might have been to one of lower skill. See Union Carbide Corp. v. Am. Can Co., 724 F.2d 1567, 1573 (Fed. Cir. 1984).

The district court was biased against Watson's expert.

Watson argues that the level of skill was high, requiring a medical degree and several years of experience in the field of reproductive endocrinology. Duramed argued below that even a nurse practitioner can be a person of ordinary skill but suggests on appeal that the district court implicitly sided with Watson. There is no evidence for Duramed's contention. Rather, the district court appears to have simply rejected all of Watson's expert's testimony by finding that Thomas was not a person of ordinary skill, but extraordinary skill. See Duramed, 701 F. Supp. 2d at 1170. That was error. Since a determination of obviousness is made from the vantage point of a legal construct, a hypothetical person having ordinary skill in the pertinent art, In re Rouffet, 149 F.3d 1350, 1357 (Fed. Cir. 1998), a person of extraordinary skill may opine on the knowledge of this hypothetical person, see Moore v. Wesbar Corp., 701 F.2d 1247, 1253 (7th Cir. 1983) (holding that an expert of "more than the 'ordinary skill' required by the statute" was "well suited to assist the court in deciding what would be obvious to such a person"). Accordingly, Thomas's credentials as a tenured professor who actively participates in endocrinology research do not disqualify him from opining on what an ordinary person of lesser skill, whether a medical doctor with less research experience or a nurse practitioner, would have understood from the prior art.

Finally, contrary to Duramed's claim, Thomas's expert testimony was not merely conclusory. He connected each claim limitation with disclosures in the prior art, and his opinion on a motivation to combine rests on factual support in the record. J.A. 823-26, 836-38; cf. Perfect Web Techs., Inc. v. InfoUSA, Inc., 587 F.3d 1324, 1331 (Fed. Cir. 2009) (holding expert testimony insufficient to raise a genuine issue of fact when it relied on irrelevant prior art and failed entirely to address one claim limitation). Accordingly, this testimony should not have been disregarded on summary judgment. See KSR, 550 U.S. at 427 ("In considering summary judgment on th[e] question [of obviousness] the district court can and should take into account expert testimony, which may resolve or keep open certain questions of fact.").

In light of the errors made by the district court, we reverse the district court's grant of summary judgment of nonobviousness and remand. We note, however, that in reviewing the record de novo on summary judgment and crediting Duramed's lower level of skill in the art, the district court on remand may well conclude that the claimed extended-cycle COC regimen would have been obvious as a matter of law.

Some dumb lawyering by Watson over obviousness.

Thus, on the record before us, there appear to be no genuine issues of material fact that, based on the teaching of Kovacs, the '749 patent, and the Sulak articles, one of ordinary skill would have been motivated to combine the Kovacs regimen and 7 days of 10 µg unopposed ethinyl estradiol with a reasonable expectation that the combination would reduce the incidence of headaches associated with that regimen. Yet, Watson did not move for summary judgment of obviousness and stated at oral argument that it was "absolutely not" requesting that this court hold the asserted claims obvious as a matter of law. Oral Arg. at 1:12-1:43. In light of this procedural posture, Duramed did not have an opportunity to challenge Watson's prima facie case of obviousness or introduce any secondary considerations of nonobviousness. Accordingly, we leave that determination to the district court on remand.

In another vein, Watson proffered some garbled illogic over excluded expert testimony.

We therefore decline to decide to what degree such evidence may or may not contribute to a determination of obviousness by clear and convincing evidence, concluding instead that Watson failed to meet its "particularly high hurdle" to demonstrate that the district court abused its discretion in excluding testimony on prior use. Texas Digital, 308 F.3d at 1218.

The wrap-up:

For the foregoing reasons, we reverse the district court's grant of summary judgment of nonobviousness, affirm the court's exclusion of Watson's expert testimony on prior use, and remand for further proceedings consistent with this opinion.

Because Judge Hicks needs the practice. The patent litigation crapshoot continues. Viva Las Vegas!