Bayer Ag v. Carlsbad Technology, Inc.

• Decision Date: 14 August 2002
• Docket Number: No. 02-1077.,02-1077.
• Citation: 298 F.3d 1377
• Parties: BAYER AG and Bayer Corporation, Plaintiffs-Appellees, v. CARLSBAD TECHNOLOGY, INC., Defendant-Appellant.
• Court: U.S. Court of Appeals — Federal Circuit

298 F.3d 1377

BAYER AG and Bayer Corporation, Plaintiffs-Appellees, v. CARLSBAD TECHNOLOGY, INC., Defendant-Appellant.

No. 02-1077.

United States Court of Appeals, Federal Circuit.

August 14, 2002.

Rehearing and Rehearing En Banc Denied September 23, 2002.

Fred H. Bartlit, Jr., Bartlit Beck Herman Palenchar & Scott, of Chicago, IL, argued for plaintiffs-appellees. With him on the brief were Mark L. Levine and Sean W. Gallagher. Of counsel on the brief were Charles W. Bradley and Stanley L. Amberg, Orrick, Herrington & Sutcliffe LLP, of New York, NY. Also of counsel on the brief were Bruce R. Genderson, Margaret A. Keeley, and Aaron P. Maurer Williams & Connolly LLP, of Washington, DC.

Gary M. Hnath, Venable, Baetjer, Howard & Civiletti, LLP, of Washington, DC, argued for defendant-appellant. With him on the brief was Fei-Fei Chao.

Before RADER, GAJARSA, and PROST, Circuit Judges.

RADER, Circuit Judge.

On summary judgment, the United States District Court for the Southern District of California held that the expiration date of U.S. Patent No. 4,670,444 (the '444 patent) is December 9, 2003. Because the district court correctly concluded as a matter of law that the disclaimed term of the '444 patent was "due to" U.S. Patent No. 4,544,658, whose expiration date the Uruguay Round Agreements Act (URAA) amendments automatically changed from October 1, 2002 to December 9, 2003, this court affirms.

I.

Bayer AG and Bayer Corporation (collectively Bayer) filed a patent application on May 29, 1984 that ultimately issued as the '444 patent on June 2, 1987. The subject matter of the '444 patent includes the antibiotic ciprofloxacin sold by Bayer under the brand name CIPRO®. Bayer also obtained two related patents covering ciprofloxacin: U.S. Patent No. 4,544,658 issued on October 1, 1985 (the Peterson '658 patent) and U.S. Patent No. 4,556,658 issued on December 3, 1985 (the Grohe '658 patent).

In December 1991, Barr Laboratories, Inc. (Barr) notified Bayer of Barr's Abbreviated New Drug Application (ANDA) submission to the Food and Drug Administration (FDA). Barr alleged that the '444 patent was invalid and unenforceable due to obviousness, obviousness-type double patenting, and inequitable conduct. In response, Bayer filed an infringement suit against Barr in the United States District Court for the Southern District of New York. To counter Barr's allegation of double patenting of the '444 patent over the two '658 patents, Bayer filed a terminal disclaimer with the United States Patent and Trademark Office (PTO). Bayer AG v. Barr Lab., Inc., 798 F.Supp. 196, 24 USPQ2d 1864 (S.D.N.Y.1992).

On February 21, 1992, Bayer disclaimed "the terminal part of U.S. Patent No. 4,670,444 which extends beyond October 01, 2002, the earlier of the expiration dates of U.S. Patent Nos. 4,544,658 (issued October 01, 1985) and 4,556,658 (issued December 03, 1985)." Terminal Disclaimer filed February 21, 1992 (Terminal Disclaimer). This disclaimer language is the source of the present dispute. The April 21, 1992, issue of the PTO's Official Gazette carried a notice of the disclaimer stating: "The term of this patent subsequent to October 1, 2002, has been disclaimed."

In 1994, the URAA "harmonize[d] the term provision of United States patent law with that of our leading trading partners which grant a patent term of 20 years from the date of filing of the patent application." Merck & Co. v. Kessler, 80 F.3d 1543, 1547, 38 USPQ2d 1347, 1349 (Fed. Cir.1996). The URAA took effect on June 8, 1995, changing the patent term from seventeen years from the date of issuance to twenty years from the date of filing of the patent application. 35 U.S.C. § 154(a)(2) (2000). In addition, § 154(c)(1) allows "the greater of the 20-year term as provided in subsection (a), or 17 years from grant, subject to any terminal disclaimers." Id. § 154(c)(1). Consequently, the expiration date of the Peterson '658 patent changed from October 1, 2002 (seventeen years from grant) to December 9, 2003 (twenty years from filing of application) by operation of law.

On July 10, 1995, Bayer sought to reflect the change that the URAA made on the term of the '444 patent by submitting an "amended terminal disclaimer" and a "communication submitting amended terminal disclaimer." Bayer requested the PTO amend the terminal disclaimer filed February 21, 1992 with new wording that "disclaims the terminal part ... which would extend beyond the earlier of the expiration dates of the full statutory term... of U.S. Patent Nos. 4,544,658 ... and 4,556,658" or, alternatively, to consider the communication a petition. The amended terminal disclaimer did not recite a specific date, but only referred to the expiration dates of the two '658 patents.

In view of the URAA, the PTO found Bayer's original disclaimer ambiguous in that "it sets forth two (2) dates beyond which the terminal part of the ['444 patent] is disclaimed: October 1, 2002, and December 9, 2003." Decision on petition, Application No. 06/614,923, at 5 (Jan. 31, 1996) (Decision). The PTO responded that its rules of practice did not permit withdrawal of a terminal disclaimer in favor of an amended terminal disclaimer. Nonetheless, in considering Bayer's request as a petition under its discretionary authority,^* the PTO stated:

In view of the ambiguity in the terminal disclaimer filed February 21, 1992 created by the changes to 35 U.S.C. § 154(c)(1) contained in Public Law 103-465, Office records will be changed to indicate that the term of the above-identified patent subsequent to December 9, 2003, the later of the two (2) dates set forth in the terminal disclaimer filed on February 21, 1992, has been disclaimed.

Id.

In April 2001, Carlsbad Technology, Inc. (CTI) notified Bayer of its ANDA on ciprofloxacin. Bayer filed suit in the district court in May 2001, asserting that the '444 patent on ciprofloxacin was valid until December 9, 2003. CTI counterclaimed that the ciprofloxacin claims in the '444 patent expire on October 1, 2002. The parties dispute whether the inclusion of the "October 01, 2002" date in the February 21, 1992 terminal disclaimer created an ambiguity as to the relationship between the '444 patent and the two '658 patents. Bayer and CTI cross-moved for summary judgment. The district court denied CTI's motion and granted summary judgment in favor of Bayer. Bayer AG v. Carlsbad Tech., Inc., Civ. No. 01-867-B (LSP), slip op. at 11 (S.D.Cal. Nov. 1, 2001) (Summary Judgment). CTI timely appealed to this court, which has jurisdiction under 28 U.S.C. § 1295(a)(1).

II.

This court reviews a district court's grant of summary judgment without deference. Johns Hopkins Univ. v. Cellpro, Inc., 152 F.3d 1342, 1353, 47 USPQ2d 1705, 1713 (Fed.Cir.1998). This court must decide "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c); Celotex Corp. v Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). In making this determination, this court views the record in a light most favorable to the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); C.R. Bard, Inc. v. Advanced Cardiovascular Sys., Inc., 911 F.2d 670, 672-73, 15 USPQ2d 1540, 1542-43 (Fed.Cir.1990).

CTI does not dispute the facts of this case. Rather, it challenges the district court's application of the URAA to Bayer's original terminal disclaimer which upheld the PTO's determination that the '444 patent expires on December 9, 2003. CTI asserts that the 1992 disclaimer clearly and unambiguously fixed the '444 patent's expiration date to October 1, 2002. CTI notes that the PTO published the October 2002 date in the Gazette, indicating that the disclaimer set the expiration date for October 1, 2002.

Title 35 of the United States Code as amended in light of the URAA, states:

(a)(2) Term. Subject to the payment of fees under this title, such grant shall be for a term beginning on the date on which the patent issues and ending 20 years from the date on which the application for the patent was filed in the United States or, if the application contains a specific reference to an earlier filed application or applications under section 120, 121, or 365(c) of this title, from the date on which the earliest such application was filed.

....

(c)(1) Determination. The term of a patent that is in force on or that results from an application filed before the date that is 6 months after the date of the enactment of the Uruguay Round Agreements Act shall be the greater of the 20-year term as provided in subsection (a), or 17 years from grant, subject to any terminal disclaimers.

35 U.S.C. §§ 154(a)(2) and (c)(1). In response to public comments on its rules to implement the new twenty-year term, the PTO stated:

A patent that is in force on June 8, 1995, or a patent that issues after June 8, 1995, on an application filed before June 8, 1995, is automatically entitled to the longer of the 20-year patent term measured from the earliest U.S. effective filing date or 17 years from grant. This is automatic by operation of law. Patentees need not make any election to be entitled to the longer term.

Changes to Implement 20-year Patent Term and Provisional Applications, 60 Fed. Reg. 20,195, 20,207 (April 25, 1995) (emphasis added).

In the present case, Bayer's February 21, 1992 terminal disclaimer recites in pertinent part:

Bayer ... disclaims the terminal part of U.S. Patent No. 4,670,444 which extends beyond October 01, 2002, the earlier of the expiration dates of U.S. Patent Nos. 4,544,658 (issued October 01, 1985) and 4,556,658 (issued December 03, 1985), and hereby agrees that U.S. Patent No. 4,670,444 shall be enforceable only for and during such period that legal title to U.S. Patent...