United States: Defendants Allowed To Hide The Ball On Their Combination Of Prior Art References

Holding

In Exelixis, Inc. v. MSN Laboratories Private Ltd., No. 19-2017 (D. Del. Apr. 20, 2022) ("Mem. Order"), Judge Richard Andrews of the United States District Court for the District of Delaware granted-in-part and denied-in-part a Daubert motion seeking to exclude the obviousness opinions of two experts.

Background

On October 29, 2019, May 11, 2020, and February 23, 2022, Exelixis, Inc. ("Exelixis") filed three separate complaints for patent infringement against MSN Laboratories Private Ltd. and MSN Pharmaceuticals Inc. (collectively, "MSN"). In total, Exelixis asserted that MSN infringed six different patents—U.S. Patent Nos. 7,579,473 (the "'473 patent"), 8,497,284 (the "'284 patent"), 8,877,776 (the "'776 patent"), 11,091,439 (the "'439 patent"), 11,091,440 (the "'440 patent"), and 11,098,015 (the "'015 patent")—by filing an Abbreviated New Drug Application with the Food and Drug Administration requesting approval to manufacture and sell a generic version of CABOMETYX®, a medication used to treat medullary thyroid cancer, renal cell carcinoma, and hepatocellular carcinoma. In its first amended answer and counterclaims in the October 29^thcase, MSN additionally sought declaratory judgment of noninfringement of a seventh patent: U.S. Patent No. 9,809,549 (the "'549 patent"). The October 29^thand May 11^thcases were consolidated on July 21, 2020.

A stipulated judgment of infringement for the '473 and '284 patents, should the claims thereof be found not invalid, was entered in the consolidated case on October 1, 2021. Soon after, the parties served expert reports, including the reports of two MSN experts: Dr. Salvatore Lepore and Dr. Jonathan Steed. Dr. Lepore provided an opinion on the alleged obviousness of the '473 and '284 patents under 35 U.S.C. § 103, while Dr. Steed spoke to the alleged obviousness of the '776 patent. Both experts were deposed in February 2022. On March 11, 2022, Exelixis filed a Daubert motion to exclude the reports and testimony of both experts and filed a motion in limine to the same effect on April 18, 2022. After briefing on both motions, the court rendered a memorandum opinion granting-in-part and denying-in-part the Daubert motion ("Mem. Order"). In the same opinion, the court stated that the parties would address the motion in limine at an upcoming pretrial conference.

Expert Opinions

In its memorandum order, the court denied Exelixis's motion to exclude all but twelve paragraphs of Dr. Lepore's obviousness opinion.¹  Mem. Order at 1. The court acknowledged that, in each of its motions, Exelixis's primary complaint was that Dr. Lepore failed to identify specific combinations of prior art references to support his obviousness opinion, instead relying on a single prior art reference disclosing a lead compound "combined with one or more references from each of [three] categories." Exelixis, Dkt. 269, Ex. A. These three categories comprised (1) four references discussing "c-Met's role in various [c]ancers"; (2) six references "related to selecting a lead compound"; and (3) fourteen references "related to modifying the lead compound." Id.; Mem. Order at 1. The court concluded that the issue of failing to identify specific combinations of prior art references was not appropriately raised in a Daubert  motion to exclude expert testimony. Mem. Order at 2. Citing In re Ethicon, Inc., 844 F.3d 1344, 1349-51 (Fed. Cir. 2017), the court further explained that Dr. Lepore's obviousness opinion was adequately supported by his discussion of how a skilled artisan would be motivated to combine, with a reasonable expectation of success, "what was disclosed in the prior art" more generally. Id.  at 2 n.1. The court concluded that any other issues raised by the motion to exclude could be handled through objections at trial. Id.

Additionally, the court opined that while the issue of failing to identify specific combinations of references could be heard on a motion in limine, it would not grant the motion at that time because it did not consider it necessary for Dr. Lepore to use only one reference directed to "c-Met's role in various [c]ancers" and one reference "related to selecting a lead compound." Id. at 2. The court thought the issue as to whether Dr. Lepore would need to rely on one reference "related to modifying the lead compound" was fuzzy and stated that the parties would discuss the motion in limine at an upcoming pretrial conference. Id.

Take-Aways

Though this memorandum opinion was short, big things can come in small packages. And there is a lot to unpack with this opinion, as it stands for the proposition that an expert opinion as to whether one or more claims are obvious may be substantiated by the general assertion that a skilled artisan would be motivated to combine at least some of a group (or groups) of references. In other words, it makes the identification of specific combinations of prior art exclusively a merits issue (as opposed to one invoking merits and evidentiary concerns). And in doing so, it may allow a party challenging validity to substantially delay its "articulat[ion of] a clear theory of obviousness" based on the combination of a specific cluster of references—arguably in contravention of Federal Circuit precedent. ProBatter Sports, LLC v. Sports Tutor, Inc., 680 F. App'x 972, 975 (Fed. Cir. 2017). This unassuming opinion may thus have far-reaching impacts on the development of strategies in future patent litigations that patent practitioners would do well to monitor.

Footnote

1. MSN stated during briefing that it no longer sought to present its invalidity defense on the '776 patent, which rendered the motion to exclude moot as to Dr. Steed's obviousness opinion for that patent.

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