The case, decided this past Friday, is Natera, Inc. v. NeoGenomics Laboratories, Inc., precedential opinion by Chief Judge Moore, joined by Judges Taranto and Chen. The parties, competitors in the market for oncology testing, both “manufacture products used for early detection of cancer relapse” (p.2). The patentee’s product is called Signatera; the defendant’s, RaDaR.
Without going into more detail than is necessary for purposes of this short post, I will note, first, that the court affirms the district court’s finding of likelihood of success on the merits. Specifically, the court rejects arguments that the district court erred “by not engaging in explicit claim construction,” noting among other things that the defendant raised this issue for the first time in its motion for a stay pending appeal, and concluding that the district court did not “implicitly construe the claims incorrectly” or err in finding that RaDaR performs the two essential steps of “tagging isolate cell free DNA” and “amplifying the tagged products” (pp. 7-8). The court also rejects the defendant’s argument that “‘mere vulnerability’ of the patent to an invalidity challenge suffices to defeat a preliminary injunction” (pp. 8-9), and finds no clear error in the district court’s application of the obviousness subfactors of motivation to combine and reasonable expectation of success (pp. 9-12).
Next, the court finds no error in the district court’s analysis of irreparable harm, rejecting the argument that the district court “endorse[d] a universal rule that irreparable harm is evident in any scenario of direct competition with an alleged infringer,” and noting instead that the district court considered that evidence along with evidence of the plaintiff’s unwillingness to license the patent in suit, and its “potential for lost biopharmaceutical partnerships, business relationships, clinical opportunities, and market share.” Regarding this last item in particular, the evidence suggests that “patients who begin using RaDaR now will likely not switch to Signatera in the future” (pp. 13-14). Additionally, there was sufficient evidence of a causal nexus between the alleged infringement and the plaintiff’s harm. On this issue, the defendants made an interesting, though unsuccessful, argument that the plaintiff’s harm related to an unclaimed feature of the patent in suit:
NeoGenomics argues the district court erred by considering the tumor-informed testing market because tumor-informed testing is not claimed in the ’035 patent. Because the district court tied Natera’s alleged harm to direct competition between Natera and NeoGenomics in the tumor-informed market, NeoGenomics argues the alleged harm is attributable to an unpatented feature and therefore lacks a causal nexus with the alleged infringement. . . .
The district court did not legally err by considering tumor-informed testing in its irreparable harm analysis. The district court was presented with evidence that the ’035 patented method is tied to consumer demand for RaDaR. Natera argued that RaDaR’s driver of demand, highly sensitive tumor-informed testing, would be impossible to achieve without practicing the particular methods claimed in the ’035 patent. J.A. 920 (Pl.’s Prelim. Inj. Br.). Natera also presented evidence that the method claimed in the ’035 patent was critical to overcoming challenges associated with successfully amplifying and sequencing cfDNA in the claimed ctDNA context. . . . The district court did not err by crediting Natera’s argument that the allegedly infringing method is key to RaDaR’s tumor-informed testing (pp. 14-15).
The court also rejects the argument that Natera “unreasonably delayed in bringing suit” by waiting until seven months after the patent issued, noting that Natera was busy with other ongoing infringement litigation and that Natera brought suit “four days after RaDaR was approved for Medicare coverage and within four months of RaDaR becoming commercially available” (pp. 15-16). (This would appear to be a distinction between U.S. law and the law of some other countries. Four months probably would be too long to satisfy the “urgency” requirement in Germany and the UPC.)
Finally, the court devotes several pages to the parties’ public interest arguments. Without going into all the detail here, it was significant that the district court included several carve-outs for existing patients and research projects involving RaDaR; and although the defendant presented evidence suggesting that its product was technically superior, there was conflicting evidence on this point. And the interest in patient choice, standing alone, does not preclude preliminary injunctive relief, because “[t]aken to its logical extent . . . [that] argument would preclude a preliminary injunction for any medical or healthcare-related product” (p.20).
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