United States District Court, D. Maryland
PAR PHARMACEUTICAL, INC. and ALKERMES PHARMA IRELAND LTD.
TWI PHARMACEUTICALS, INC.
Catherine C. Blake United States District Judge
pending is the motion of defendant TWi Pharmaceuticals, Inc.
(“TWi”) for an exceptional case determination and
attorneys' fees under 35 U.S.C. § 285. Plaintiffs Par
Pharmaceutical, Inc. and Alkermes Pharma Ireland Limited
(collectively, “Par”) have filed a response in
opposition to the motion. For the reasons that follow,
TWi's motion will be denied.
acquired U.S. Patent No. 7, 101, 576 (“the ‘576
patent”) in 2006. The patent relates to Par's Megace
ES drug, a nanoparticulate formulation of megestrol acetate
used to treat anorexia, cachexia, and unexplained weight loss
in patients with HIV and AIDS. After Par acquired the
‘576 patent, TWi filed an ANDA seeking FDA
authorization to market a generic version of Megace ES. TWi
timely notified Par of this filing, and, under 21 U.S.C.
§ 355(b)(2)(A) (a “Paragraph IV”
certification under the Hatch-Waxman Act), asserted that the
‘576 patent “is invalid or will not be infringed
by the manufacture, use, or sale of the new drug for which
the application is submitted.” Par filed suit in
September 2011 to block the sale of TWi's generic product
on the ground that it infringed the ‘576 patent.
five-day bench trial, the court ruled on February 21, 2014,
that the ‘576 patent was invalid as obvious.
(Memorandum & Order, ECF Nos. 212, 213.) Par requested,
and this court granted, an injunction pending resolution of
the case on appeal, and Par posted a $10 million bond as
security. (Memorandum & Order, ECF Nos. 257, 258.) On
appeal, the Federal Circuit vacated the court's judgment
and remanded the case “for further analysis of the food
effect limitation consistent with [the Federal Circuit's]
precedent on inherency.” Par Pharm., Inc. v. TWi
Pharms., Inc., 773 F.3d 1186, 1200 (Fed. Cir. 2014). On
March 9, 2015, the court granted another injunction while it
considered the case on remand and ordered Par to post an
additional $6 million bond. (Memorandum & Order, ECF Nos.
279, 280.) On July 28, 2015, the court ruled that the
‘576 patent was invalid as obvious and for lack of
enablement. (Memorandum & Order, ECF Nos. 304, 305.) Par
noted an appeal that same day and moved for another
injunction, which this court denied. (Memorandum & Order,
ECF Nos. 311, 312.) The Federal Circuit affirmed the
invalidity determination on December 15, 2015. Par
Pharm., Inc. v. TWi Pharms., Inc., 624 Fed. App'x
756 (Fed. Cir. 2015) (mem.).
285 of the Patent Act authorizes district courts to award
attorneys' fees to prevailing parties in
“exceptional cases.” 35 U.S.C. § 285. In
2014, the Supreme Court overturned “unduly rigid”
Federal Circuit precedent to hold that an
“exceptional” case is “simply one that
stands out from others with respect to the substantive
strength of a party's litigating position (considering
both the governing law and the facts of the case) or the
unreasonable manner in which the case was litigated.”
Octane Fitness, LLC v. ICON Health & Fitness,
Inc., 134 S.Ct. 1749, 1755, 1756 (2014). An award of fees
may be justified where a case “present[s] either
subjective bad faith or exceptionally meritless claims,
” or where a party has engaged in misconduct, even if
that conduct is not independently sanctionable. Id.
at 1757. The nonexclusive list of factors a district court
may consider includes “frivolousness, motivation,
objective unreasonableness (both in the factual and legal
components of the case) and the need in particular
circumstances to advance considerations of compensation and
deterrence” when determining whether to award fees.
Id. at 1756 n.6 (quoting Fogerty v. Fantasy,
Inc., 510 U.S. 517, 534 n.19 (1994) (internal quotation
marks omitted)). District courts “may determine whether
a case is ‘exceptional' in the case-by-case
exercise of their discretion, considering the totality of the
circumstances, ” id. at 1756, and a movant
must establish an exceptional case by a preponderance of the
evidence, id. at 1758. “There is no precise
rule or formula for making these determinations, but instead
equitable discretion should be exercised.” Id.
(quoting Fogerty, 510 U.S. at 534).
the evidence in light of the totality of the circumstances,
TWi has not established that this case is exceptional under
the standard articulated in Octane
Fitness. TWi first argues that Par's case
“lacked substantive strength, ” contending that
the ‘576 patent was weak and that Par's arguments
were “specious, ” “disingenuous and
unsustainable, ” and “inconsistent with its own
prior statements, actions, and positions.” (Mem. Supp.
Mot. Att. Fees 22-24, ECF No. 325.) TWi also argues that the
procedural history of the case “reflects a lack of
substantive merit.” (Id. at 23-24.) But the
evidence to which TWi points suggests only that Par had the
weaker case, not that its arguments were “exceptionally
meritless.” See Octane Fitness, 134 S.Ct. at
1757. As Par points out, it is not enough for TWi to show
that it prevailed on the merits. See LendingTree, LLC v.
Zillow, Inc., 54 F.Supp.3d 444, 458-61 (W.D. N.C. 2014).
Nor has TWi demonstrated, by a preponderance of the evidence,
that Par acted in subjective bad faith or with objective
unreasonableness. See Octane Fitness, 134 S.Ct. at
to the other pathway to attorneys' fees under Octane
Fitness, TWi argues that Par acted in an
“unreasonable manner” by, inter alia,
asserting positions it could not support at trial, concealing
information from the patent office, and engaging in
“forum shopping” by filing a separate lawsuit in
Delaware. (Mem. Supp. Mot. Att. Fees 24-26, ECF No. 325.) To
the extent that these allegations are supported by the
record, I am not convinced that they fall outside the normal
range of conduct by adversaries in litigation. Further, many
of TWi's reasonableness arguments appear to relate to
Par's substantive claims, which have been addressed
above, rather than its litigation tactics. (See,
e.g., id. at 25 (referring to various positions
taken by Par as “scorched earth tactic[s]”).) In
short, this is not one of the “rare case[s]” in
which attorneys' fees are warranted by the manner of
litigation. See Octane Fitness, 134 S.Ct. at 1757.
there is no need to award attorneys' fees in the interest
of deterrence, compensation, or any other purpose associated
with the “inherently flexible” text of Section
285. See Id. at 1756. In particular, it is unlikely
that other patent-holders will view this lengthy and
fact-intensive adjudication as encouragement to pursue
frivolous claims or engage in misconduct.
reasons stated above, TWi's motion for attorneys'
fees will be denied. A separate order follows.