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Patent Infringement Burden of Proof Again Before the Court

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By William Peacock, Esq. on February 21, 2014 2:55 PM

Last time, the question was whether a declaratory judgment action, seeking a ruling of non-infringement, shifted the burden of proof to the party pursuing the ruling (the alleged patent infringer).

This time, the issue again involves a shifting burden of proof, though the issue is complicated by questions of prior art and obviousness.

Last December, the Federal Circuit held that, once an alleged infringer discloses prior art, the burden of proof shifts to the patent holder to demonstrate that the patent should not be deemed obvious on that basis. Now, a petition for rehearing is pending, with amicus briefs attached.

Generic Drug Company Dispute

Galderma, the party seeking a rehearing, makes a gel. Tolmar makes a generic equivalent, an equivalent so close that Galderma alleged patent infringement.

The district court upheld the patents because Tolmar failed to prove that Galderma's patent was obvious. The Federal Circuit, however, reversed, and applied the shifting burden test described above.

"In these circumstances, where there is a range disclosed in the prior art, and the claimed invention falls within that range, the burden of production falls upon the patentee to come forward with evidence that (1) the prior art taught away from the claimed invention; (2) there were new and unexpected results relative to the prior art; or (3) there are other pertinent secondary considerations."

Galderma failed to meet that burden, and its patents were invalidated as obvious.

Rehearing Amicus: Singling Out 'Improvement Patents'

The Washington Legal Foundation, in its amicus brief in favor of rehearing, argues that the court's decision singles out "improvement patents," such as the one here, where the patent reflected a change from prior art. The WLF also warns that "this decision considerably reduces the incentive for innovators to develop improved medicines."

The brief also notes that the presumption of obviousness has no place in prior, controlling case law, where the court held that all evidence relevant to obviousness should be reviewed collectively, with the burden remaining on the challenger at all times.

This decision creates a harsher standard for improvement patents, even though 35 U.S.C. § 101 specifically allows for patents on "new and useful improvement[s]."

It sounds like a strong argument. We'll see if the Federal Circuit bites.

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