Federal District Court Rules that IPR Estoppel Can Apply Even After Trial on Obviousness

On April 11, 2019, in Novartis Pharmaceuticals Corp. v. Par Pharmaceutical Inc., a Hatch-Waxman case concerning the small-molecule drug Zortress® (everolimus), Judge Andrews of the District of Delaware ruled that IPR estoppel could apply on remand to the District Court even after a trial on the issue of invalidity had been held.

In Novartis, the defendants argued that U.S. Patent No. 5,665,772 (“the ’772 patent”) was invalid for obviousness and for obviousness-type double patenting.  While the case was pending, the PTAB instituted an IPR that defendants filed challenging most of the asserted claims of the ’772 patent.  Following a bench trial, Judge Andrews found the asserted claims invalid for obviousness-type double patenting, but did not address obviousness. While plaintiffs’ appeal of Judge Andrews’ decision was pending, the PTAB issued a final written decision upholding the challenged claims of the ’772 patent.  The Federal Circuit then reversed the obviousness-type double patenting decision.

On remand, Judge Andrews agreed with the plaintiffs that based on the outcome of the IPR, defendant was estopped from asserting that the claims addressed in the PTAB’s decision were invalid for obviousness based on prior art that was raised, or reasonably could have been raised, in the IPR proceeding.  Judge Andrews reasoned that, although it “is a matter of first impression,” he does “not think the application of IPR estoppel is dependent on the order in which certain events occur…. The plain language of the statute does not indicate that Congress intended for there to be a time limitation upon the estoppel effect of a final written decision of an IPR.”

As a result, Judge Andrews applied IPR estoppel despite having previously held a trial on the issue of obviousness (but never having ruled on that issue).

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