Opinion
CIVIL ACTION NO. 99-CV-4304, NO. 00-CV-4888, NO. 01-CV-0159, NO. 01-CV-2169, CIVIL ACTION NO. 99-CV-2926, NO. 00-CV-5953, NO. 02-CV-1484, CIVIL ACTION NO. 00-CV-1393, NO. 00-CV-6464, NO. 01-CV-2602, CIVIL ACTION NO. 01-CV-1027, NO. 01-CV-3364, NO. 02-CV-8493, CIVIL ACTION NO. 01-CV-2981, CIVIL ACTION NO. 03-CV-3365,
March 26, 2004
MEMORANDUM AND ORDER
Presently before the Court is the Motion of Plaintiffs SmithKline Beecham Corporation, SmithKline Beecham, P.L.C. and Beecham Group, P.L.C. for Entry of Judgment Under Rule 54(b) (Doc. No. 86, Civil Action No. 99-CV-4304; see also Civil Action Nos. 00-CV-4888, 01-CV-0159). For the following reasons, Plaintiffs' Motion will be DENIED.
Additional background regarding this litigation and the applicable statutory framework is set forth in the Court's Memoranda and Orders dated September 29, 2001, September 30, 2002, October 31, 2002, and December 20, 2002.
Plaintiffs own a series of patents relating to the anti-depressant drug Paxil(r) ("Paxil"). The patents at issue in these cases cover certain forms of paroxetine hydrochloride (the active ingredient in Paxil), processes for making paroxetine hydrochloride, and uses of paroxetine hydrochloride. Specifically, U.S. Patent No. 5,900,423 (the "`423 Patent"), granted on May 4, 1999, contains a single claim for a particular form of paroxetine hydrochloride anhydrate ("Form A"), comprising a number of identifying characteristics derived from test data. U.S. Patent No. 6,080,759 (the "`759 Patent"), granted on June 27, 2000, contains eighteen claims for processes for making paroxetine hydrochloride anhydrate Form A, and paroxetine hydrochloride anhydrate Form A made according to processes set forth in the Patent. U.S. Patent No. 6,113,944 ("the `944 Patent"), granted on September 5, 2000, sets forth two product-by-process claims for paroxetine tablets produced on a commercial scale by a defined process. Finally, U.S. Patent No. 6,172,233 (the "`233 Patent"), granted on January 9, 2001, claims processes for making paroxetine and paroxetine made by the claimed processes.
Defendants Apotex Corporation, Apotex, Inc., and Torpharm, Inc. ("Defendants") submitted an Abbreviated New Drug Application ("ANDA") to the federal Food and Drug Administration ("FDA") on March 31, 1998, seeking approval to market a generic form of Paxil, specifically, paroxetine hydrochloride anhydrous. Pursuant to the statutory framework of the 1984 Drug Price Competition and Patent Term Restoration Act (referred to herein as the "Hatch — Waxman Act" or the "Act"), Defendants' ANDA was accompanied by "Paragraph IV" certifications that the applicable patents related to Paxil are "invalid or will not be infringed by the manufacture, use or sale of the new drug for which the [ANDA] is submitted. . . ." See 21 U.S.C. § 355(j)(2)(A)(vii).
In response to Defendants' ANDA, Plaintiffs filed five lawsuits against Defendants alleging infringement of its patents related to Paxil. The first action, filed in the Northern District of Illinois (No. 98-CV-3952) on June 26, 1998, alleged infringement of U.S. Patent No. 4,721,723 (the "`723 Patent"). In this district, Plaintiffs filed Civil Action No. 99-CV-4304 on August 26, 1999, alleging infringement of the `423 Patent. On September 27, 2000, Plaintiffs filed Civil Action No. OO-CV-4888, alleging infringement of the `759 Patent and seeking a declaratory judgment that Defendants' future commercial manufacture and sale of its paroxetine hydrochloride product will infringe the process claims of the `759 Patent. Civil Action No. 01-CV-159, filed on January 11, 2001, alleges infringement of the `944 Patent. Finally, Plaintiffs filed Civil Action No. 01-CV-2169 on May 2, 2001, alleging infringement of the `233 Patent and seeking a declaratory judgment that the process claims of the `233 Patent will be infringed by Defendants' future commercial manufacture and sale of its proposed paroxetine hydrochloride product.
By suing for patent infringement, SmithKline triggered a stay of FDA final approval of Defendants' ANDA lasting thirty months from SmithKline's receipt of Defendants' ANDA notice. See 21 U.S.C. § 355(j)(5)(B)(iii).
On March 3, 2003, the Northern District of Illinois dismissed with prejudice SmithKline's claims that Apotex/Torpharm infringed the `723 patent. See SmithKline Beecham Corp. v. Apotex Corp., 247 F. Supp.2d 1011, 1052 (N.D. Ill. 2003).
Plaintiffs have filed other lawsuits in this Court against other defendants alleging infringement of their Paxil patents, all of which have been consolidated for pretrial purposes.
On December 20, 2002, we granted Defendants' motions for summary judgment as to the invalidity of Plaintiffs' "product-by-process" patent claims. See SmithKline Beecham Corp. v. Geneva Pharm., Inc., C.A. No. 99-CV-2926, 2002 U.S. Dist. LEXIS 25275 (E.D. Pa. Dec. 20, 2002). Specifically, we held that claims 11, 12 and 13 of the `233 Patent, claims 1 and 2 of the `944 Patent, and claim 6 of the `759 Patent, were all invalid for anticipation under 35 U.S.C. § 102(b). Id. at *21, *26-27, *37. We declined to summarily dispose of Plaintiffs' claims of infringement with respect to the non-product-by-process patent claims, specifically claims 10-11 and 14-15 of the `759 Patent, and all the claims of the `423 Patent. Id. at *47. Defendants did not move for summary judgment as to the validity of claims 1-10 and 14-16 of the `233 Patent.
A product-by-process patent claim "is a product claim that defines the claimed product in terms of the process by which it is made." Id. at *10 (quoting Manual of Patent Examining Procedure § 2173.05 (8th ed. 2001)). In our December 20, 2002 Memorandum and Order, we held that the validity of product-by-process claims must be evaluated independent of the process limitations of those claims. Id. at *16. Stripped of the process limitations, all of Plaintiffs' product-by-process claims were anticipated by or obvious in light of the prior art and therefore invalid as a matter of law.
In concluding that product-by-process claims must be evaluated independent of process limitations, we were forced to choose between two conflicting precedents from the Court of Appeals for the Federal Circuit. In Scripps Clinic Research Found v. Grenentech, the Federal Circuit held that "[s]ince claims must be construed the same way for validity and for infringement, the correct reading of product-by-process claims is that they are not limited to product prepared by the process set forth in the claims." 927 F.2d 1565, 1583 (Fed. Cir. 1991) (citing In re Thorpe, 111 F.2d 695 (Fed. Cir. 1985)). The following year, a different panel of the Federal Circuit decided Atlantic Thermoplastics Co., Inc. v. Faytex Corp., 970 F.2d 834 (Fed. Cir. 1992), reh'g en banc denied, 974 F.2d 1299. In Atlantic, the court rejected the holding in Scripps, and concluded that in the context of validity and infringement litigation, product-by-process claims must be construed as limited by the process claims. Atlantic, 970 F.2d at 846-47. We decided to follow Scripps — the earlier decision — because Atlantic was a panel decision, and "only an en banc decision can overrule an earlier holding." SmithKline, 2002 U.S. Dist. LEXIS, at *16 (quoting Newell Cos., Inc. v. Kenney Mfg. Co., 864 F.2d 757, 765 (Fed. Cir. 1988)). We noted however, that it is "impossible to know which approach is correct," and we "encourage[d] counsel to seek clarification of the law on this issue." Id. n. 12.
Plaintiffs moved for certification of our December 20, 2002, Order pursuant to Fed.R.Civ.P. 54(b) so they could appeal our decision to grant summary judgment and dispose of their product-by-process claims. They contend that our Order is sufficiently final to qualify for certification pursuant to Rule 54(b), and that several factors present in this case demonstrate that there is "no just reason for delay" of an appeal. FED. R. Civ. P. 54(b). Defendants claim that the Order is not sufficiently final to qualify for a Rule 54(b) certification, and that many factors counsel against certifying our Order for an immediate appeal.
II. ANALYSIS
1. Legal Standard for a Rule 54(b) Motion
The Court of Appeals for the Federal Circuit applies its own law to Rule 54(b) certification issues. See State Contracting Eng'g Corp. v. Florida, 258 F.3d 1329, 1334 (Fed. Cir. 2001) ("We have specifically held that Federal Circuit law applies to Rule 54(b) certification and appellate jurisdiction issues.") (citing Enercon Indus. Corp. v. Pillar Corp., 105 F.3d 1437, 1439 n. 2 (Fed. Cir. 1997)). To the extent Federal Circuit case law fails to provide guidance, the Federal Circuit looks to the law of all circuits equally for persuasive reasoning. W.L. Gore Assoc., Inc. v. Int'l Med. Prosthetics Research Assoc., Inc., 975 F.2d 858, 861 (Fed. Cir. 1992).
"Appellate courts have historically disfavored piecemeal litigation and permitted appeals from complete and final judgments only." W.L. Gore Assoc., Inc. v. Int'l Med. Prosthetics Research Assoc., Inc., 975 F.2d 858, 861 (Fed. Cir. 1992) (citing Catlin v. United States, 324 U.S. 229 (1945)). However, with the adoption of the Federal Rules of Civil Procedure, "there came an increased opportunity for the liberal joinder of claims in multiple claims actions." Sears, Roebuck Co. v. Mackey, 351 U.S. 427, 432 (1956). In turn, Congress recognized "a need for relaxing the restrictions upon what should be treated as a judicial unit for purposes of appellate jurisdiction." Id. "Sound judicial administration" requires that, "in multiple claims actions, some final decisions, on less than all of the claims, should be appealable without waiting for a final decision on all of the claims." Id. Thus, "Rule 54(b) allows a district court to sever an individual claim that has been finally resolved." W.L. Gore, 975 F.2d at 861. It provides, in relevant part:
When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment.
To certify a judgment as final under Rule 54(b), we must address two distinct issues. First, we must determine whether the judgment is "final with respect to one or more claims." W.L. Gore, 975 F.2d at 861. A district court may not certify a judgment pursuant to Rule 54(b) when it "has ruled on only `part of a single claim.'" Id. at 863 (quoting Tolson v. United States, 732 F.2d 998, 999 (D.C. Cir. 1984)). To be eligible for certification under Rule 54(b), the judgment must be `"an ultimate disposition of an individual claim entered in the course of a multiple claims action.'" Id. at 861-62 (emphasis removed) (quoting Sears, 351 U.S. at 436). "The requirement of finality is a statutory mandate and not a matter of discretion." Id. at 862.
If we determine that there is a final judgment as to an individual claim, we must then exercise our discretion "to determine the `appropriate time' when each final decision in a multiple claims action is ready for appeal." Curtiss — Wright Corp. v. General Elec. Co., 446 U.S. 1, 8 (1980). "[I]n deciding whether there are no just reasons to delay the appeal of individual final judgments . . ., a district court must take into account judicial administrative interests as well as the equities involved." Id. In exercising this discretion, courts have considered a number of factors, including, "whether the claims under review were separable from the others remaining to be adjudicated and whether the nature of the claims already determined was such that no appellate court would have to decide the same issues more than once even if there were subsequent appeals." Id.
2. Discussion
The `233 and `759 Patents
In our December 20, 2002 Order, we granted summary judgment in favor of Defendants and ruled that all of Plaintiffs' product-by-process claims were invalid. Since all of the claims of the `944 Patent were product-by-process claims, no claims of infringement with respect to the `944 Patent remain undecided. With respect to the `233 and `759 Patents however, the validity and infringement of certain claims (i.e., the non-product-by-process claims), remain in litigation.
Plaintiffs argue that each claim asserted under a patent may be separately infringed, because "each claim of a patent is treated as if it were a separate patent." (Pl's Mot. at 3 (citing 3 Chisum on Patents 8:06[4] (2002).) Therefore, Plaintiffs urge, we may certify as a final judgment a decision as to the validity of an individual claim asserted under a patent, even though the validity and infringement of other claims asserted under the same patent remain undecided. Defendants argue that federal law does not recognize separate causes of action for infringement of particular claims asserted under a patent. Therefore, Defendants contend, only a judgment that determines the validity of all the claims asserted under a patent that is the subject of an infringement suit is eligible for certification under Rule 54(b).
A number of courts have held that under Rule 54(b), "claims cannot be separate unless separate recovery is possible on each." Local P-l 71, Amalgamated Meat Cutters Butcher Workmen v. Thompson Farms Co., 642 F.2d 1065, 1070 (7th Cir. 1981) (citing Page v. Preisser, 585 F.2d 336, 339 (8th Cir. 1978)); see also In re Southeast Banking Corp., 69 F.3d 1539, 1547 (11th Cir. 1995) ("Claims are separable when there is more than one possible recovery . . . or if `different sorts of relief are sought. . . .") (citing 10 Charles A. Wright, Arthur R. Miller Mary Kay Kane, Federal Practice Procedure § 2657, at 67 (2d ed. 1983) and Seatrain Shipbuilding Corp. v. Shell Oil Co., 444 U.S. 572, 580-81 n. 18 (1980)); Samaad v. City of Dallas, 940 F.2d 925, 931 (5th Cir. 1991) ("[I]t is clear that a claimant who presents a number of alternative legal theories, but whose recovery is limited to only one of them, has only a single claim of relief for purposes of Rule 54(b).") (quoting Page, 585 F.2d at 339); Sussex Drug Prod. v. Kanasco, Ltd., 920 F.2d 1150, 1154 (3d Cir. 1990) ("Separate counts of a negligence complaint setting forth distinct theories of liability each of which contains the same two elements of damages state but a single claim.") (citing RePass v. Vreeland, 357 F.2d 801, 804 (3d Cir. 1966)). Cf. Mortenson Co. v. United States, 877 F.2d 50, 52 (Fed. Cir. 1989) (holding that Rule 54(b) refers to claims "in the sense of the substantive right being asserted — the cause of action"). Federal Circuit case law is clear that "[a] patent is infringed if any claim is infringed . . . for each claim is a separate statement of the patented invention." Pall Corp. v. Micron Separations, Inc., 66 F.3d 1211, 1220 (Fed. Cir. 1995) (citations omitted) (refusing to reach question of infringement of the process claims asserted under a patent "[i]n view of our affirmance of infringement of the product claims"). Therefore, an action alleging infringement of multiple claims asserted under a single patent asserts a single claim for purposes of Rule 54, as the plaintiffs recovery is the same no matter which theory of infringement, if any, is ultimately proven. Insofar as our December 20, 2002 Order determined the validity of only some of the claims asserted under the `233 and `759 Patents, we hold that it was not a final judgment and may not be certified for an immediate appeal.
We find further support for this conclusion from two non-precedential cases from the Federal Circuit. In Donnelly Corp. v. Gentex Corp., No. 96-1103, 1996 WL 468452 (Fed. Cir. Aug. 19, 1996), the appellant sought review of an order granting summary judgment as to its claims of infringement with respect to some, but not all the claims asserted under a single patent. The Federal Circuit dismissed the appeal, noting that "[t]he term `claim' as used in Rule 54(b) refers, of course, to a claim in a cause of action, not to individual patent claims. . . . [I]t is difficult to imagine a case in which subject matter is sufficiently related to be covered by a single patent, and yet sufficiently distinct as to warrant the grant of a motion for partial final judgment." Donnelly, 1996 WL 468452, at *3. Similarly, in Johns — Manville Corp. v. Guardian Indus. Corp., Nos. 90-1054, 90-1076, 1990 WL 72111 (Fed. Cir. Apr. 4, 1990), the appellant in a patent infringement suit sought review of a judgment pursuant to Rule 54(b) even though certain liability issues remained undecided. The Federal Circuit dismissed the appeal, noting that only one patent was at issue, and that "a complaint asserting only one legal right, even if seeking multiple remedies for the alleged violation of that right, states a single claim for relief." Johns — Manville, 1990 WL 72111, at * 1 (quoting Libery Mutual Ins. Co. v. Wetzel, 424 U.S. 737, 754 n. 4(1976)).
The `944 Patent
In contrast, our December 20, 2002 Order determined that all of Plaintiffs' claims under the `944 Patent were invalid. See SmithKline, 2002 U.S. Dist. LEXIS, at *22. Thus, with respect to the `944 Patent, the Order was a final judgment of an individual claim for purposes of Rule 54(b) and is eligible for certification. We must now examine the relevant factors to determine whether there is any "just reason for delay" of an appeal of our Order with respect to the `944 Patent. FED. R. CIV. P. 54(b).
We conclude that a majority of the relevant factors counsel against piecemeal appeals in this case. Clearly, Plaintiffs' claims of infringement of the `944 Patent on the one hand, and the `233 and `759 Patents on the other, are closely related. Plaintiffs claim that the Defendants' ANDA, which sought to market a generic form of Paxil, infringed all three patents. In addition, we held that the product-by-process claims of both the `233 and `944 Patents were anticipated by the same patent, the `723 Patent. See SmithKline, 2002 U.S. Dist. LEXIS, at *19, 27. Thus, there is a clear risk in certifying that the Federal Circuit will "have to decide the same issues more than once." Curtiss — Wright, 446 U.S. at 8. Judicial administrative interests weigh against certification.
In weighing the equitable interests, we fail to see the irreparable harm Plaintiffs claim they will suffer absent an immediate appeal. On July 30, 2003, the FDA granted final approval to Defendants' ANDA to market a generic form of Paxil. In a letter, the FDA noted that on "July 1, 2003, [SmithKline] requested that FDA remove the `927, `759, and `233 patents from the Orange Book. Thus, [SmithKline] has effectively abandoned its claim to that 30 — month stay." FDA Letter dated July 30, 2003, at 6, available at http://www.fda.gov/cder/ogd/shared_exclus_ paroxetine.htm. Plaintiffs argue that they need to immediately appeal our Order to protect their claim to the 30 — month stay. Now that Plaintiffs have abandoned their claim to the stay, we see no need to certify an immediate appeal. In sum, we think that there are just reasons to delay Plaintiffs' appeal, and accordingly we will deny Plaintiffs' motion to certify under Rule 54(b).
An appropriate Order follows.
ORDER
AND NOW, this 26th day of March, 2004, upon consideration of the Motions of Plaintiffs SmithKline Beecham Corporation, SmithKline Beecham, P.L.C. and Beecham Group, P.L.C. for Entry of Judgment Under Rule 54(b) (Doc. No. 86, Civil Action No. 99-CV-4304; see also Civil Action Nos. OO-CV-4888, 01-CV-0159), and all papers filed in support thereof or in opposition thereto, it is ORDERED that Plaintiffs' Motion is DENIED.IT IS SO ORDERED.