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Magistrate Judge Burke issues report and recommendation on motion to dismiss induced infringement claims

Magistrate Judge Christopher J. Burke recently issued a report and recommendation on a motion to dismiss allegations of induced infringement made in a second amended complaint.  GlaxoSmithKline LLC v. Teva Pharmaceuticals USA, Inc., C.A. No. 14-878-LPS-CJB (D. Del. July 20, 2016).  At issue were allegations that a generic manufacturer induced infringement by (1) “promot[ing] on its website and other marketing materials the ‘AB rating’ of its generic carvedilol tablets and market[ing of] them as therapeutically equivalent” to the patented branded drug product; (2) its pre-patent issuance of press releases anticipating approval of the generic product for the to-be-patented method of treatment; (3) its obtaining a label for its generic product that suggested using the generic product for an off-label, patented use; and (4) its marketing of its generic product for the off-label, patented use and acknowledgement that its generic product was not suitable for substantial non-infringing uses.

Magistrate Judge Burke first addressed the defendant’s marketing efforts surrounding the “AB rating” by the FDA, and explained that “in the Court’s view (again, absent any other evidence that speaks to a generic manufacturer’s intent), a finding in this context that the promotion of an ‘AB rating’ could amount to a plausible induced infringement claim would go too far.  It would rely too heavily on the mindset or misconceptions of third parties in an attempt to ascribe wrongful intent to the alleged inducer.”  Id. at 20 (emphasis in original).

With respect to the press releases, Judge Burke explained that where alleged acts of inducement occurred before the issuance of the plaintiff’s patent, those acts generally cannot form the basis of an inducement claim.  However, “where there are acts of inducement that continue after the issuance of a patent, courts have indicated that acts occurring prior to the patent’s issuance could still be relevant to an induced infringement claim.”  Id. at 22 (emphasis in original).  Here, Judge Burke sided with the plaintiff, and explained that “what the party did and said before the patent issued might at least bear on what its mindset was in the crucial post-issuance time period (so long as that party did, in fact, perform an inducing act in that post-issuance time period).”  Id. at 23 (emphasis in original).   

Turning to the label, Judge Burke explained that “there can, in fact, be situations where a generic manufacturer seeks and obtains a section viii carve-out for a use of a drug that is (according to the FDA) a ‘different’ use from a patented use – and yet the generic’s label could nevertheless be written in such a way that it evidences active steps to induce patent infringement.”  Id. at 30.  Here, Judge Burke agreed with the plaintiff that “it is plausible that Teva’s promotion of its skinny label encouraged infringement of the ‘000 patent during the relevant time period.”  Id. at 31-32.

Finally, Judge Burke agreed with the plaintiff that “where a brand name drug is alleged to not have substantial non-infringing uses, it could be inferred that a generic company’s knowledge that some users of its product may be infringing the patent … evidences intent to induce infringement.”  Id. at 37 (emphasis in original).

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