# Reply Brief — Implax Laboratories, Inc. v. Astrazeneca AB (No. 05-1583)

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386016_1029%3A3

## Record

- **Collection:** Supreme Court brief
- **Document type:** Reply Brief
- **Published:** January 1, 2006

## Text

AGL 7 BRAY
“—Ae gush t
rae

2
No. 05-1583

In the
Supreme Court of the Anited States

IMPAX LABORATORIES, INC.,
Petitioner,

Vv.

ASTRAZENECA AB, AKTIEBOLAGET HASSLE,
KBI-E INC., KBI INC. and ASTRAZENECA LP,
Respondent.

On Petition for a Writ of Certiorari to the United
States Court of Appeals for the Federal Circuit

REPLY BRIEF OF PETITIONER

Jerrrey J Toney
Counsel of Record
Joun L. Nortu
WILLIAM F. Lonc
SUTHERLAND AssiL_ & BRENNAN LLP
999 PEACHTREE STREET
ATLANTA, GA 30309
(404) 853-8000

Counsel for Petitioner
Impax Laboratories, Inc.

Becker Gallagher Legal Publishing, Inc. 800.890.5001

i

LIST OF PARTIES TO THE PROCEEDING
PURSUANT TO RULES 14.1(b) AND 29.6

Petitioner Impax Laboratories, Inc. certifies that the
names of all parties to this proceeding appear in the caption
of this Petition for Writ of Certiorari.

Petitioner has no parent corporation, and no publicly held
company owns 10% or more of its stock.

a

ii
TABLE OF CONTENTS
Page

I. THE PRESENT CASE PRESENTS A BETTER
CASE FOR SUPREME COURT REVIEW THAN
TECHNOLOGY LICENSING 2... cic ccesees l

Ili. THE TECHNOLOGY LICENSING OPINION DID
NOT ELIMINATE CONFUSION ............ 4

IV.THE TEGAL CASE DID NOT INVOLVE A
DECLARATORY JUDGMENT COUNTERCLAIM

V. RESPONDENT DOES NOT DISPUTE THAT THE
ONLY 18TH CENTURY CIVIL PROCEEDING
THAT COULD INVALIDATE A PATENT WAS
THE COMMON LAW WRIT OF SCIRE FACIAS . 6

VI. CONCLUSION

ill
TABLE OF AUTHORITIES

Cases

Beacon Theatres, Inc. v. Westover,
ee Rae ee D3 peso hon ig G36 wa oO we 3,9

Cardinal Chemical Co. v. Morton Int'l, Inc.,
ai PE ck ae wee ha a ae ees 8

Dairy Queen, Inc. v. Wood,
Pe a EE i a oe Oe ew 3

In re Evangelist,
ep Poke Ls BR. | Rear ebe pee ere at 5

First National Bank of Boston v. Bellotti,
ee ee a en na 6 obi a bo Ke 3

Fort James Corp. v. Solo Cup Co.,
G52 Fe bee Oe. CO. Be) oe ee ne oes 8

Glaxo Group Ltd. v. Apotex, Inc.,
No. 00 C 5791, 2001 WL 1246628
ee a es ED 8k oe 4S Eo RS 2

Hildebrand v. Board of Trustees,
f » & 2 Fe ay... Sepa eae eee eee 5

Hoechst Marion Roussel, Inc. v. Par Pharmaceutical, Inc..,
Civ. No. 95-3673 (DRD), 1996 WL 468593
Ca weey I ty SOR 0.5 sah 8 oS Ceres wk 2

King v. Arkwright,
EN Waa ae Rly POM oy 6 da wk he oo Wee 7

iv

King v. Else,
1 Carp. P.C. 103, Dav. Pat. Cas. 144 (K.B. 1785) . 7

La Buy v. Howes Leather Co.,

Oe A Oe CATE. aR we CRO 4
In re Lockwood,

50 F360 906. (Fed, Cit. 1995) 06s ewes 4,5, 6
Meyer v. Grant,

SOR a, SLOTS) hv ns 6 Me koe eee 3

O2 Micro International Ltd. v. Monolithic Power Systems,

399 F. Supp. 2d 1064 (N.D. Cal. 2005) ........ 5
Pernell v. Southall Reality,

WEE is OP AITTED Ca ele wees eee Ree 10

| Pfizer Inc. v. Novopharm Lid.,

No. 00 C 1475, 2001 WL 477163

Nc a PO, SOOEE eee beer 2
Ross v. Bernhard,

SE RG A PE ok a0 wo ee 9
Sanofi-Synthelabo v. Apotex Inc..,

No. 02- Civ. 2255 RWS,

2002 WL 1917871 (S.D.N.Y. Aug. 20, 2002) .... 2
Schlagenhauf v. Holder,

SEF a PEATE hoe oe 6 Co a ieee ees 4

In re Simons,
ye | i. Gy a) Gt | ERR Pa Rar ammE mete etarMera cra Sores att 3

v

Super Sack Manufacturing Corp. v. Chase Packaging Corp.,
DT ee BOOT re, Ce OO) kes Cote ae ewes 9

In re Technology Licensing,
423 F.3d 1286 (Fed. Cir. 2005)........... passim

Tegal v. Tokyo Electron America, Inc.,
Eat Pid Bee es Cle BOE 8s oes ele wae 5, 6

Tull v. United States,
ee ee REED 5 Slieia.0- 4k 6 eRe ones 9,10

Warner-Lambert Co. v. Purepac Pharmaceutical Co..,
No. Civ. A. 98-2749 (JCL),

2001 WL 8&#3232 (D.N.J. March 30, 2001) ...... 2
Statute
te PE es bia Spee ba eae wees 2,3
Other Authorities

1 J. Oldham, The Mansfield Manuscripts and the
Growth of English Law in the 18th Century (1992) ... 7-8

P. Devlin, Jury Trial of Complex Cases: English
Practice at the Time of the Seventh Amendment,
a Re ee Us SO RUUD 6 oc verwceuteaweaes 8

Wendy H. Schacht & John R. Thomas, The Hatch-
Waxman Act: Legislative Changes In The 108th

Congress Affecting Pharmaceutical Patents,

Reem CONE TL Sao ss CIUOD) vc icscccidecwern 2

1

The present case presents a better case for Supreme Court
review than the recent petition of Technology Licensing. In
Technology Licensing, the Federal Circuit held that the
plaintiff had voluntarily waived the right to a jury. No waiver
exists in the present case. Moreover, the outcome of the
present case will affect the rights of generic pharmaceutical
companies to get their competing products to market. The
petition is not moot, as it presents an issue “capable of
repetition, yet evading review.”

Rather than eliminate confusion, the Technology Licensing
opinion will cause more confusion because it could not and
did not overrule prior inconsistent Federal Circuit caselaw,
and contrary to Astra’s argument, has put the Federal Circuit
in conflict with the other circuits.

Astra does not dispute that the only 18" Century judicial
proceeding that could invalidate a patent was the writ of scire
facias. Astra’s other arguments are irrelevant under this
Court’s historical analysis. In sum, Astra has provided no
sound reason for denying Impax’s petition.

I. THE PRESENT CASE PRESENTS A BETTER
CASE FOR SUPREME COURT REVIEW THAN
TECHNOLOGY LICENSING

The present case presents a significantly better case for
this Court’s review than /n re Technology Licensing, 423 F.3d
1286 (Fed. Cir. 2005), cert. denied, 2006 WL 1519374,
(U.S. Jun 05, 2006) because the Technology Licensing facts
were clouded by an issue of waiver. The Federal Circuit
found that Technology Licensing had “voluntariiy abandoned”
its right to a jury trial. /d. at 1289-90.

The Federal Circuit and the District Court are attempting
to extend the Technology Licensing holding to the facts of
present case, notwithstanding that the present case includes no
issue of waiver. The District Court expressly found that

2

Impax had not waived its right to a jury, 12a-13a and the

Federal Circuit agreed: “Impax timely asserted a demand for
a jury trial.” 6a.

The present case presents a better case for the Court’s
review than Technology Licensing for the additional reason
that it involves the right of generic pharmaceutical companies
to get competing products to market under the Hatch-Waxman
Act. Protecting the rights of generic drug companies presents
an issue that is of exceptional importance to the well-being of
this nation. See generally Wendy H. Schacht & John R.
Thomas, The Hatch-Waxman Act: Legislative Changes In The
108th Congress Affecting Pharmaceutical Patents, CRS
Report RL 32377 (2004). Moreover, unlike other patent
cases, generic drug cases filed initially under 35 U.S.C.
§ 271(e) present a class of cases in which this precise issue
arises with frequency because the patentee will frequently
have the option of amending its initial complaint (which
contains no damages claim) with a subsequent claim for
damages, as was the situation in the present case. See, e.g.,
Sanofi-Synthelabo v. Apotex Inc., No. 02- Civ. 2255 RWS,
2002 WL 1917871 (S.D.N.Y. Aug. 20, 2002); Warner-
Lambert Co. v. Purepac Pharmaceutical Co., No. Civ. A.
98-2749 (JCL), 2001 WL 883232 (D.N.J. March 30, 2001);
Hoechst Marion Roussel, Inc. v. Par Pharmaceutical, Inc.,
Civ. No. 95-3673 (DRD), 1996 WL 468593 (D.N.J. March
14, 1996); Pfizer Inc. v. Novopharm Ltd., No. 00 C 1475,
2001 WL 477163 (N.D. Ill. May 3, 2001); Glaxo Group Ltd.
v, Apotex, Inc., No. 00 C 5791, 2001 WL 1246628 (N.D. Ill.
Oct. 16, 2001).

Il. |THE PETITION IS NOT MOOT

Contrary to Astra’s argument, Astra’s Brief in Opposition
(“Astra Opp.”) at 2, 26-27, the petition is not moot, as no
final judgment has been entered below. Moreover, if and

3

when entered, final judgment will not moot the issue, as this
case presents the precise situation which is “capable of
repetition yet evading review.” First National Bank of Boston
v. Bellotti, 435 U.S. 765, 774 (1978). A case is not mooted
when (1) the challenged action was in its duration too short to
be fully litigated prior to its cessation nor expiration, and (2)
there is a reasonable expectation that the same complaining
party will be subjected to the same action again. /d. at 774-
775; Meyer v. Grant, 486 U.S. 414, 417 n.2 (1988). Both
elements are satisfied in the present case.

The challenged action is the wrongful striking of
Petitioner’s jury demand. Petitioner followed the preferred
procedure for challenging that action, namely, filing a petition
for a writ of mandamus. See Beacon Theatres, Inc. v.
Westover, 359 U.S. 500, 511 (1959); Dairy Queen, Inc. v.
Wood, 369 U.S. 469, 472 (1962). This Court has repeatedly
approved the use of mandamus as the appropriate vehicle for
correcting a wrongfully stricken demand for a jury, because
waiting until after a final judgment cannot undo the harm to
the requesting party. /n re Simons, 247 U.S. 231, 239-240
(1918). When the district court and court of appeals refuse to
stay the trial pending this Court’s review - and the
Technology Licensing opinion now provides a strong
disincentive for a district court to stay a trial pending review
- a proceeding seeking a writ »f mandamus provides
insufficient time for this Court to cunsider the issue.

More than a reasonable expectation exists that Impax will
be subjected to the wrongful denial of a right to a jury trial
again. Impax is a generic drug company. Hence, practically
every time it files an Abbreviated New Drug Application, it
will be sued for infringement by the name-brand drug
manufacturer under 35 U.S.C. § 271(e). The initial suit
cannot include a claim for damages, but as is typically the
case, Impax will receive approval to market its drug before

4

the infringement suit has been adjudicated. Impax and its
customers will be faced with the threat of a damages suit, and
the name-brand pharmaceutical company can exercise the
same tactics as Astra in the present case by, for example,
suing to recover damages from Impax’s customers but seeking
only injunctive relief directly from Impax, and thereby
wrongfully denying Impax a jury.

Contrary to the implication of Astra’s arguments, a
petition requesting review of an order denying a writ of
mandamus does not impose a higher standard of review. See,
e.g., Schlagenhauf v. Holder, 379 U.S. 104 (1964)
(reviewing denial of mandamus); see also La Buy v. Howes
Leather Co., 352 U.S. 249 (1957) (reviewing grant of
mandamus). This Court should consider and decide the issue
now.

Ill. THE TECHNOLOGY LICENSING OPINION DID
NOT ELIMINATE CONFUSION

Astra’s position is, in essence, that the Technology
Licensing opinion has eliminated the confusion caused by the
Federal Circuit’s conflicting opinions. See, e.g., Astra’s Opp.
at 10-11. That argument might carry some weight if
Technology Licensing had overruled Jn re Lockwood, 50 F.3d
966 (Fed. Cir. 1995) (patentee entitled to jury trial on
counterclaim of invalidity notwithstanding that damages claim
had been dismissed) and the other Federal Circuit opinions
inconsistent with Technology Licensing. But the Technology
Licensing panel did not even have the power to overrule
Lockwood, and in any event, expressly approved Lockwood.
Technology Licensing, 423 F.3d at 1288 n.1.

District courts now will be required to sort out the Federal
Circuit’s inconsistent opinions, which is certain to result in
misapplication of this Court’s Seventh Amendment case law.
As noted in Impax’s Petition, the Technology Licensing

5

court’s attempt to reconcile its opinion with Lockwood puts
the Federal Circuit in direct conflict with the other circuits on
whether a dismissed claim is relevant to determining the right
to a jury trial, a conflict which Astra refuses even to
acknowledge. Astra Opp. at 8. Technology Licensing is
certain to cause only more confusion rather than resolving any
confusion.

For example, the district court in O2 Micro International
Lid. v. Monolithic Power Systems, 399 F. Supp. 2d 1064,
1087-88 (N.D. Cal. 2005) found that a jury could not be
treated as merely advisory on a counterclaim of invalidity
when a party demanded a jury, notwithstanding that the
patentee’s damages claim had been dismissed via summary
judgment. The O2 Micro court believed that, under
Technology Licensing, the dismissed damages claim (as
opposed to the counterclaim of invalidity) gave rise to a right
of jury trial. Compare with In re Evangelist, 760 F.2d 27, 32
(1* Cir. 1985) (claim for damages dismissed on summary
judgment not relevant when determining party’s asserted
Seventh Amendment right to a trial by jury); Hildebrand v.
Board of Trustees, 607 F.2d 705, 710 (6" Cir. 1979)
(accord). Astra’s arguments that Technology Licensing has
resolved any district court confusion and that the opinion does
not conflict with the other circuits are meritless.

IV. THE TEGAL CASE DID NOT INVOLVE A
DECLARATORY JUDGMENT
COUNTERCLAIM

Astra’s reliance upon Tegal v. Tokyo Electron America,
Inc., 257 F.3d 1331 (Fed. Cir. 2001) is misplaced. Astra
Opp. at 13-14. The accused infringer in Tegal filed only an
affirmative defense of invalidity; it did not file a counterclaim
seeking a declaratory judgment of invalidity. Tegal, 257 F.3d
at 1338, 1339.

6

Nevertheless, Tegal further undermines Astra’s argument
that Technology Licensing resolved any confusion existing in
Federal Circuit Seventh Amendment jurisprudence. The
Tegal court emphasized that Lockwood’s holding (i.e., that
the accused infringer’s counterclaim of invalidity was triable
to a jury notwithstanding that the patentee’s damages claim
had been dismissed before trial) did not apply when the
accused infringer asserted only affirmative defenses and no
counterclaim. The Tegal court was careful to distinguish the
situation in which the accused infringer had asserted no
counterclaim: “this court holds that a defendant, asserting
only affirmative defenses and no counterclaims, does not have
a right to a jury trial in a patent infringement suit if the only
remedy sought by the plaintiff-patentee is an injunction.” /d.
at 1341 (emphasis supplied).

V. RESPONDENT DOES NOT DISPUTE THAT THE
ONLY 18™ CENTURY CIVIL PROCEEDING THAT
COULD INVALIDATE A PATENT WAS THE
COMMON LAW WRIT OF SCIRE FACIAS

Astra does not dispute that the writ of scire facias was the
only 18" century English judicial proceeding that could be
used by an accused infringer to invalidate a patent. Astra does
not Jeny that the relief sought in the modern counterclaim is
identical to the relief sought in the 18" century writ of scire
facias. Instead, Astra attempts to raise other arguments that
are irrelevant under this Court’s historical analysis.

A. Astra requests the Court to compare a modern
reexamination proceeding before the PTO, a non-judicial
proceeding, with the writ of scire facias. Astra Opp. at 22-
23. Astra’s proposed comparison is entirely irrelevant. The
fact that a modern reexamination proceeding and the 18”
century writ of scire facias both could be used to invalidate a
patent does not change the fact that writ of scire facias is the

7

best analog to the modern declaratory judgment action of
invalidity.’ This Court’s historical test requires identifying
the closest 18” century analog with the claim and relief
requested in the case at issue, not with some other proceeding
not even at issue in the case.

B. Astra’s argument that the standing requirement under
the 18" century writ of scire facias was broader than the
modern declaratory judgment counterclaim, Astra Opp. at 24-
25, even if true, is similarly irrelevant. Astra tacitly admits
that an 18" century competitor threatened with an
infringement suit could initiate a writ of scire facias
proceeding. Hence, the nature of the writ of scire facias
encompassed precisely the nature of the modern declaratory
judgment action to invalidate a patent. Whether the writ of
scire facias was available to a broader class of litigants than
the modern action is not relevant. The important point is that
scire facias provided a cause of action to at least the same
class of litigants as the modern declaratory judgment action to
invalidate a patent.

C. Astra suggests incorrectly that all writs of scire facias
were tried in courts of chancery. Astra Opp. at 21. In fact,
scire facias proceedings to invalidate patents were ultimately
tried in common law courts. See, e.g., King v. Else, 1 Carp.
P.C. 103, Dav. Pat. Cas. 144 (K.B. 1785), and King v.
Arkwright, 1 Carp. P.C. 53 (K.B. 1785). Both Else and
Arkwright were tried before the King’s Bench, an English
common law court. The Arkwright case was tried before
Judge Mansfield, one of the most famous common law judges
of the late 18" century. See, generally, 1 J. Oldham, The

' Of course, the modern declaratory judgment counterclaim is much more
similar to the writ of scire facias, because, for example, both are judicial
proceedings.

8

Mansfield Manuscripts and the Growth of English Law in the
18" Century (1992). Indeed, a “writ” was the procedure to
initiate an action at law, as opposed to a “bill” which was the
procedure to initiate a proceeding in equity. P. Devlin, Jury
Trial of Complex Cases: English Practice at the Time of the
Seventh Amendment, 80 Colum. L. Rev. 43, 57, 58 (1980).
It is true that the chancery courts had great power, and the
jurisdiction of the common law courts has been described as
“any suit which the Lord Chancellor ... would permit to be
tried in the [common law courts].” /d. at 45. Some legal
causes of action would be filed with the court of chancery, but
if the court deemed it a legal cause of action rather than an
equitable cause, it would refer the action to the common law
courts, and if necessary, invent a new writ to provide the
plaintiff with a means to proceed before a court of law. /d.
at 49. The only mode of trial available to a common law court
was a trial by jury. /d. at 44.

D. Astra denies the independent nature of a counterclaim
seeking a declaratory judgment of patent invalidity. Astra
Opp. at 18-19, 25 n.6. Contrary to Astra’s argument, the
fact that such a claim may not be asserted unless there is at
least a threat of suit by a patentee does not diminish the
independent nature of the declaratory judgment action seeking
invalidity. Cardinal Chemical Co. v. Morton Int'l, Inc., 508
U.S. 83, 96 (1993). Such a declaratory judgment claim may
be asserted without regard to whether the patentee actually
files suit, and the court would retain jurisdiction to adjudicate
the claim even if the patentee did not file a counterclaim of
infringement or if the patentee’s claim of infringement is
dismissed. See Fort James Corp. v. Solo Cup Co., 412 F.3d
1340, (Fed. Cir. 2005) (court maintains jurisdiction of
declaratory judgment counterclaim to invalidate a patent
unless patentee covenants not to sue for past, present and
future infringement). Astra’s argument that the accused

9

infringer loses its standing to litigate a counterclaim of
invalidity if the patentee withdraws its infringement
allegations is false, except in the circumstance (not present in
this case) when the patentee covenants not to sue for past,
present or future infringement. /d.; accord Super Sack
Manufacturing Corp. v. Chase Packaging Corp., 57 F.3d
1054, 1059-60 (Fed. Cir. 1995).

E. Astra’s argument based upon modern pleading rules
that require the joinder in one suit of any infringement claim
with a declaratory judgment claim of invalidity is also without
merit. Astra Opp. at 25. Indeed, this argument has already
been considered and rejected by this Court. See Ross v.
Bernhard, 396 U.S. 531, 538 (1970) (the “Seventh
Amendment question depends on the nature of the issue to be
tried rather than the character of the overall action”); Beacon
Theatres, 359 U.S. at 510 (“the availability of declaratory
judgment or joinder in one suit of legal and equitable causes”
cannot be used as a basis to deny the right of jury trial on
legal issues). The fact that a suit for infringement is a
compulsory counterclaim under modern pleading procedures
does not affect the nature of the analysis: whether the
declaratory judgment counterclaim asserts legal rather than
equitable relief.

Even if the modern counterclaim seeking to have a patent
invalidated can be properly characterized as “sui generis,” it
would not diminish the parties right to a jury trial. “The
[Seventh] Amendment requires trial by jury in actions
unheard of at common law.” Tull v. United States, 481 U.S.
412, 420 (1987).

F. Astra also implies, incorrectly, that the remedy of
damages is always the test for a right to a jury. Astra Opp.
at 13. To be sure, if damages are sought, then a right to a
jury attaches. But this Court has emphasized that if the

10

remedy sought, whether it be damages or some other remedy,
was available in the late 18” century England only in a court
of law, then the parties are entitled to a jury trial on demand.
Tull v. United States, 481 U.S. 412, 421-422 (1987) (because
a civil penalty was a type of remedy at common law that
could only be enforced in courts of law, the parties were
entitled to a jury trial on demand). Although the existence of
damages in a case clearly gives right to a jury, the lack of a
demand for damages hardly proves that no jury right exists.
Numerous legal causes of action exist that entitle the parties
to a jury that do not involve a demand for damages. See,
e.g., Pernell v. Southall Reality, 416 U.S. 363, (1974) (action
to recover possession of real property entitled to a jury trial
because it was a common law remedy under 18" century
procedure). In Pernell, the relief requested constituted a
demand for legal relief, and the parties were therefore entitled
to a jury on demand. Petitioner’s demand to invalidate
Respondent’s patent constitutes a demand for legal relief, and
therefore entitles the parties to a jury. The absence of a
demand for damages is not relevant given the legal nature of
Petitioner’s demand.

CONCLUSION

The right to a jury trial is one of the most important rights
guaranteed by our Constitution. Astra has provided no
argument to rebut the reasons for granting certiorari outlined
in Impax’s Petition. Impax respectfully submits that the
Court should grant Impax’s petition for a writ of certiorari.

Respectfully submitted,

Jeffrey J. Toney
Counsel of Record

John L. North

William F. Long

Sutherland Asbill &
Brennan LLP

999 Peachtree Street

Atlanta, Georgia 30309

(404) 853-8000

Attorneys for Petitioner
Impax Laboratories, Inc.

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386016_1029%3A3. Public record. Not legal advice.