967 F.3d 1339
Fed. Cir.2020Background
- Takeda and Mylan settled Takeda’s ANDA litigation in a November 7, 2017 License Agreement that allows Mylan to launch a generic Colcrys® product on a set date or earlier if certain triggers occur; Section 1.2(d) permits earlier launch after a “Final Court Decision” holding that "all unexpired claims of the Licensed Patents that were asserted and adjudicated against a Third Party" are not infringed/invalid/unenforceable.
- Separately, Takeda litigated against Hikma (West‑Ward litigation) concerning Mitigare®; Takeda voluntarily dismissed five of eight asserted patents and the district court entered final judgment of noninfringement as to the remaining three patents in December 2018; Takeda did not appeal.
- Mylan cited the West‑Ward final judgment as the Section 1.2(d) trigger and launched its generic Nov. 25, 2019; Takeda sued for breach and patent infringement and sought a preliminary injunction to stop sales.
- The district court denied the preliminary injunction, holding Section 1.2(d) was triggered by the West‑Ward Final Court Decision (because the clause applies only to claims that are both asserted and adjudicated) and that Takeda had not shown irreparable harm absent an injunction.
- The Federal Circuit affirmed: applying Delaware contract law, the court found Section 1.2(d) unambiguous and triggered by the West‑Ward judgment; Takeda’s §1.10 stipulation of irreparable harm was inapplicable because Takeda was unlikely to show breach, and Takeda’s unsupported assertions of price erosion were insufficient to establish irreparable harm.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Takeda likely to succeed on merits — does §1.2(d) require a Final Court Decision covering "all asserted" claims (including dismissed ones)? | §1.2(d)’s use of "all" requires that every patent asserted in the West‑Ward case be adjudicated on the merits; five dismissed patents were not adjudicated so the trigger did not occur. | §1.2(d) requires that all unexpired claims that were both asserted and adjudicated be found not infringed; the West‑Ward decision adjudicated all unexpired claims of the three remaining patents, so the trigger occurred. | Court: Agrees with Mylan; plain language requires claims to be both asserted and adjudicated; West‑Ward adjudicated all unexpired claims of the three patents — §1.2(d) triggered; Takeda unlikely to succeed. |
| Whether §1.2(d) is limited to outcomes involving generic Colcrys® products (product scope) | Parties intended §1.2(d) to apply only to changes among generic equivalents of Colcrys®, not to unrelated §505(b)(2) products like Mitigare®. | §1.2(d) contains no product limitation; parties knew how to limit other sections to generic equivalents when intended. | Court: No implicit product limitation; objective reading of the agreement does not confine §1.2(d) to generic Colcrys® products. |
| Whether Takeda will suffer irreparable harm absent an injunction | §1.10 stipulates irreparable harm on Mylan’s breach; Takeda would suffer price erosion and long‑term market loss that money cannot remedy. | The §1.10 stipulation applies only if Mylan actually breached §1.2; because Takeda is unlikely to show breach, the stipulation is inapplicable and monetary damages would suffice. | Court: Stipulation inapplicable given likely no breach; Takeda’s market‑erosion claims are speculative and unsupported — no demonstrated irreparable harm. |
| Whether district court abused its discretion in denying preliminary injunction | District court misread the contract and should have enforced stipulated injunctive remedy. | District court properly applied Delaware contract interpretation and preliminary‑injunction standards. | Court: No abuse of discretion; affirmed denial of preliminary injunction. |
Key Cases Cited
- Winter v. Natural Resources Defense Council, 555 U.S. 7 (2008) (sets the four‑factor preliminary injunction standard)
- Abbott Labs. v. Andrx Pharm., Inc., 452 F.3d 1331 (Fed. Cir. 2006) (standard of review for preliminary injunction decisions)
- Endo Pharm. Inc. v. Actavis, Inc., 746 F.3d 1371 (Fed. Cir. 2014) (contract interpretation and appellate review principles)
- Exelon Generation Acquisitions, LLC v. Deere & Co., 176 A.3d 1262 (Del. 2017) (Delaware objective theory of contract interpretation)
- Osborn ex rel. Osborn v. Kemp, 991 A.2d 1153 (Del. 2010) (plain‑meaning rule; extrinsic evidence barred for unambiguous contracts)
- United States v. Geiser, 527 F.3d 288 (3d Cir. 2008) (interpretation of conjunctive "and" requiring both conditions be met)
- Aria Diagnostics, Inc. v. Sequenom, Inc., 726 F.3d 1296 (Fed. Cir. 2013) (recognizes price erosion and market share loss can be irreparable in some cases)
- Frank's GMC Truck Ctr., Inc. v. Gen. Motors Corp., 847 F.2d 100 (3d Cir. 1988) (adequacy of monetary damages undermines irreparable‑harm claim)