Dey, L.P. v. Sunovion Pharmaceuticals, Inc. , 715 F.3d 1351 ( 2013 )

United States Court of Appeals
for the Federal Circuit
______________________
DEY, L.P., DEY, INC., AND MYLAN, INC.,
Plaintiffs-Appellants,
v.
SUNOVION PHARMACEUTICALS, INC. (formerly
known as Sepracor, Inc.),
Defendant-Appellee.
______________________
2012-1428
______________________
Appeal from the United States District Court for the
Southern District of New York in No. 07-CV-2353, Judge
John G. Koeltl.
______________________
Decided: May 20, 2013
______________________
EVAN R. CHESLER, Cravath, Swaine & Moore, LLP, of
New York, New York, argued for plaintiffs-appellants.
With him on the brief was ROGER G. BROOKS. Of counsel
on the brief were EDGAR H. HAUG and ROBERT E.
COLLETTI, Frommer, Lawrence & Haug, LLP, of New
York, New York.
JOSEPH M. O’MALLEY, JR., Paul Hastings, LLP, of New
York, New York, argued for defendant-appellee. With
2 DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC.
him on the brief were BRUCE M. WEXLER and DAVID M.
CONCA. Of counsel on the brief was STEPHEN B. KINNAIRD
of Washington, DC.
______________________
Before NEWMAN, BRYSON, and O’MALLEY, Circuit Judges.
Opinion for the court filed by Circuit Judge BRYSON.
Dissenting opinion filed by Circuit Judge NEWMAN.
BRYSON, Circuit Judge.
During the late 1990s and 2000s, Sunovion Pharma-
ceuticals, Inc., and the Dey plaintiffs (Dey, L.P.; Dey, Inc.;
and Mylan, Inc.) were simultaneously developing phar-
maceutical products to treat lung disease. Sunovion filed
a patent application, followed by an application to test its
products in human subjects. It then received a patent
and held clinical trials, all before ultimately releasing a
commercial product. Dey likewise filed a series of patent
applications, received several patents, ran human subject
trials, and released a commercial product. Dey’s patent
applications were filed after Sunovion’s, and its patents
were issued after consideration of Sunovion’s patent.
When Dey sued Sunovion for patent infringement,
Sunovion argued, and the district court agreed, that some
of Dey’s patents were invalid because a Sunovion clinical
trial in which Sunovion tested its own product constituted
a prior public use of Dey’s inventions within the meaning
of 35 U.S.C. § 102(b). 1 In that respect, this case is unusu-
al. To the extent the public use bar is raised in the con-
text of clinical trials, it normally entails a party defending
its own clinical trials against the charge that the trials
constituted a public use of the same party’s invention.
1 References to 35 U.S.C. § 102(b) are to the pre-2011
version of the Patent Act.
DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC. 3
Here, by contrast, Sunovion asserts that a drug formula-
tion that was tested in its own clinical trial anticipated
Dey’s inventions and was accessible to the public, thus
invalidating the later-issued Dey patents. Although the
parties’ dispute would seem to present a classic issue of
priority, it comes to us as a public use dispute, not a
priority contest, and we must apply public use principles
to resolve it. Doing so, we conclude that Sunovion has not
shown that it is entitled to summary judgment based on
its assertion that its use of formulations meeting the
limitations of Dey’s later-issued patents constituted a
public use of Dey’s inventions within the meaning of
section 102(b). We therefore reverse the grant of sum-
mary judgment for Sunovion.
I
Both parties own patents and sell products concerning
the treatment of chronic obstructive pulmonary disease
(“COPD”) by storing the compound formoterol in an
aqueous solution and administering it through a nebuliz-
er. Sunovion owns U.S. Patent No. 6,040,344 (the “Gao
patent”), which issued in March 2000 from an application
filed in 1998. Dey owns two families of patents, the
second of which includes U.S. Patent Nos. 7,348,362;
7,462,645; 7,465,756; 7,473,710; and 7,541,385. The
patents in the second Dey family all issued in 2008 or
2009 but claim the benefit of an application filed on July
10, 2003. 2 According to Dey, the significant difference
between the two companies’ patents relates to the stabil-
ity of the formulations during long-term storage.
Sunovion ultimately produced a commercial product,
known as Brovana, in 2007, but the path that led to the
marketing of that drug was long. In February 1998,
Sunovion filed an Investigational New Drug application
2 The first family of Dey patents—U.S. Patent Nos.
6,667,344 and 6,814,953—is not at issue in this appeal.
4 DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC.
with the FDA, seeking approval to conduct clinical trials
with human subjects. Tests began shortly thereafter.
One such test was Clinical Study Number 091-050
(“Study 50”), a Phase III trial that began in February
2002. The study, which was double-blind and random-
ized, tested three different dosages of formoterol known as
Batches 3501A, 3501B, and 3501C. The parties have
stipulated that the formulation of Batch 3501A is identi-
cal to the formulation that Sunovion ultimately marketed
as Brovana. During a 12-week period in the middle of the
study, the participants received treatments to take home
and self-administer twice daily.
The participants in Study 50 were given some infor-
mation about the study and were subjected to certain
controls. They were told that the study concerned “the
effects of (R,R)-formoterol, an experimental medication
(not yet approved by the . . . FDA) to treat COPD,” and
that it would test three particular doses of (R,R)-
formoterol (the three batches) as compared to a placebo
and another drug. 3 Participants were not provided any
more specific information about the formulation of Batch
3501A. A Sunovion witness testified that the specific
formulation of Brovana remained “[un]available to the
public” and “confidential” even as of the time this action
was brought.
The participants in the study signed a consent form
stating that the medications “must be taken only by the
person for whom it was intended” and that subjects would
have to keep usage logs and return unused medications.
The form also noted that participants “may wish to dis-
cuss this study . . . with [their] regular doctor[s]” and
3 The parties agree that formoterol has been in the
public domain since at least 1976, when it appeared in
U.S. Patent No. 3,994,974, which was directed to com-
pounds “useful as bronchodilating agents.”
DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC. 5
allowed them to “request that the person who is in charge
of this study speak directly with [their] doctor[s].” The
participants were not prohibited from speaking with
others about the study.
The test administrators were also subject to detailed
restrictions. They had to sign a formal “Clinical Investi-
gator Confidentiality Agreement” directing them to hold
all proprietary information in confidence for five years.
They were forbidden from disclosing the study protocols
or dispensing the drug to any person who was not a trial
subject, and they were held accountable for securely
storing the drug and maintaining records of its disposition
and use. Like the trial subjects, the investigators were
instructed that unused supplies of the drug were to be
returned upon completion or termination of the study.
A total of 587 subjects participated in the study. Of
those, 124 received Batch 3501A. At least some of those
individuals received Batch 3501A prior to July 10, 2002—
one year before Dey filed the patent application that led
to its second family of patents. Thousands of vials con-
taining Batch 3501A were distributed during the trial; the
study records indicate that a fraction of one percent of
those vials were lost and not returned. The subjects who
misplaced the vials were given replacements and were
allowed to continue with the tests. The study concluded
in June 2003.
In March 2007, shortly before Brovana was set to
launch, Dey brought suit charging Sunovion with in-
fringement of its first and second families of patents.
Sunovion moved for partial summary judgment, and the
district court granted the motion. Sunovion conceded for
purposes of its motion that “the Batch 3501A composition
[fell] within the asserted claims stemming from Dey’s
second family of patents.” That meant that the composi-
tion would anticipate Dey’s asserted claims if it was in
“public use,” as that term has been interpreted under 35
6 DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC.
U.S.C. § 102(b). The district court concluded that Sunovi-
on’s clinical trial of Batch 3501A did constitute a “public
use” of Dey’s inventions, and, accordingly, held the as-
serted claims of Dey’s second family of patents invalid.
Dey appeals.
II
A
An applicant may not receive a patent for an inven-
tion that was “in public use . . . in this country, more than
one year prior to the date of the application for patent in
the United States.” 35 U.S.C. § 102(b) (2006). To decide
whether a prior use constitutes an invalidating “public
use,” we ask “whether the purported use: (1) was accessi-
ble to the public; or (2) was commercially exploited.”
Invitrogen Corp. v. Biocrest Mfg., L.P., 424 F.3d 1374,
1380 (Fed. Cir. 2005).
Our cases have provided considerable guidance as to
what it means to be “accessible to the public.” We have
explained that the policies underlying the public use bar
inform its scope and that one such policy is “discouraging
the removal, from the public domain, of inventions that
the public reasonably has come to believe are freely
available.” Tone Bros., Inc. v. Sysco Corp., 28 F.3d 1192,
1198 (Fed. Cir. 1994). In addition, we have set forth
factors that may be helpful in analyzing the question of
public use, including “‘the nature of the activity that
occurred in public; the public access to and knowledge of
the public use; [and] whether there was any confidentiali-
ty obligation imposed on persons who observed the use.’”
Bernhardt, L.L.C. v. Collezione Europa USA, Inc., 386
F.3d 1371, 1379 (Fed. Cir. 2004). And we have said that a
public use may occur when “a completed invention is used
in public, without restriction.” Allied Colloids Inc. v. Am.
Cyanamid Co., 64 F.3d 1570, 1574 (Fed. Cir. 1995). Such
formulations are designed to capture the commonsense
notion that whether an invention is “accessible to the
DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC. 7
public” or “reasonably . . . believe[d] [to be] freely availa-
ble” depends, at least in part, on the degree of confidenti-
ality surrounding its use: “[A]n agreement of
confidentiality, or circumstances creating a similar expec-
tation of secrecy, may negate a ‘public use’ where there is
not commercial exploitation.” Invitrogen, 424 F.3d at
1382.
The same is true when an unaffiliated third party is
responsible for the allegedly public use. Although prior
uses are often carried out by or at the direction of the
inventor-patentee, we have held that “third party prior
use accessible to the public is a section 102(b) bar.” Eolas
Techs. Inc. v. Microsoft Corp., 399 F.3d 1325, 1334 (Fed.
Cir. 2005). But even in the case of third-party uses, being
“accessible to the public” still requires public availability;
secret or confidential third-party uses do not invalidate
later-filed patents. See, e.g., Woodland Trust v. Flower-
tree Nursery, Inc., 148 F.3d 1368, 1371 (Fed. Cir. 1998)
(“when an asserted prior use is not that of the applicant,
§ 102(b) is not a bar when that prior use or knowledge is
not available to the public”); W.L. Gore & Assocs. v. Gar-
lock, Inc., 721 F.2d 1540, 1549-50 (Fed. Cir. 1983); see also
Baxter Int’l, Inc. v. COBE Labs., Inc., 88 F.3d 1054, 1061
(Fed. Cir. 1996) (Newman, J., dissenting) (section 102(b)
does not cover “unknown and unknowable information in
the possession of third persons”). For that reason, we
have applied section 102(b) to invalidate a patent based
on third-party use when the third party “made no attempt
to maintain confidentiality or to deliberately evade disclo-
sure,” Eolas, 399 F.3d at 1335; made no “discernible effort
to maintain the [invention] as confidential,” Baxter, 88
F.3d at 1058; or “made no efforts to conceal the device or
keep anything about it secret,” Beachcombers v. Wil-
deWood Creative Prods., Inc., 31 F.3d 1154, 1160 (Fed.
Cir. 1994).
The degree of confidentiality necessary to avoid a
finding of public use naturally depends on the circum-
8 DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC.
stances. For example, if there is no confidentiality
agreement in place, the skill and knowledge of those
observing an invention can shed light on the degree to
which it was kept confidential. Even limited disclosure to
those who are skilled enough to know, understand, and
“easily demonstrate the invention to others,” may mean
that there was no reasonable expectation of secrecy and
that the invention was therefore in public use. Netscape
Commc’ns Corp. v. Konrad, 295 F.3d 1315, 1321 (Fed. Cir.
2002); see also Eolas, 399 F.3d at 1334; Baxter, 88 F.3d at
1058 (invention was in public use when observers includ-
ed “co-workers, who were under no duty to maintain . . .
confidential[ity]”). By contrast, when disclosure is limited
to a small number of uninformed observers there may be
no reason to believe “that a viewer . . . could thereby learn
anything of [the later-patented invention]” and disclose
the invention to others. W.L. Gore, 721 F.2d at 1549. In
such cases, a finder of fact might reasonably conclude that
the third party’s use remained confidential and that the
invention was not “accessible to the public.” Id. With
these principles in mind, we turn to the facts of this case.
B
The district court held that Sunovion was entitled to
summary judgment of invalidity because Sunovion’s own
clinical trial constituted clear and convincing evidence of
a third-party public use of Dey’s inventions. We disagree.
Important issues of fact remain in dispute, principally
whether sufficient precautions were taken to exclude
members of the public from obtaining information about
the potentially invalidating prior art (i.e., Batch 3501A).
On the record of this case, we do not agree with the dis-
trict court that no reasonable jury could return a verdict
for Dey.
The district court focused its analysis on two fact-
bound issues. On both, we view the record differently
than did the district court. First, we do not share the
DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC. 9
court’s belief that the use of Batch 3501A by Study 50
participants was indisputably open and free. The district
court observed that participants were given the drugs,
took them home, and, “whether or not they would have
been able to reverse engineer batch 3501A, . . . used the
invention as intended.” The court also highlighted the
fact that a few participants failed to return unused medi-
cation, as they were required to do, but nonetheless were
given more of the medication. Based on those facts, the
court concluded that the participants “were not prevented
from using their personal supply of that substance how-
ever they saw fit” and that “the participants’ unfettered
use of the composition for weeks at a time itself constitut-
ed a public use.”
Dey vigorously disputes the district court’s view of the
facts. Dey argues that the study subjects’ use of Batch
3501A was anything but “unfettered” and points to docu-
ments showing that neither the study subjects nor the
clinical investigators were permitted to use the drugs
“however they saw fit.” For example, test subjects agreed
that only they would take the medications, and they
promised to keep accurate usage logs and return all
unused medication. Similarly, test administrators could
dispense drugs only to trial subjects, were held accounta-
ble for secure storage and records of drug use, and knew
that unused supplies had to be returned. Viewing this
evidence in Dey’s favor, as we must, we cannot say that
the allegedly anticipating prior art was clearly used
“without restriction” during Study 50. Allied Colloids, 64
F.3d at 1574. The fact that a tiny fraction of the thou-
sands of vials were lost without penalizing the responsible
test subject(s), or that the practicalities of the study
required self-administration at home rather than physi-
cian administration in a closed facility, does not preclude
a reasonable jury from concluding that the use of Batch
3501A was sufficiently controlled and restricted, rather
than unfettered and public.
10 DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC.
Nor do we agree with the district court’s conclusion
that the confidentiality obligations imposed in Study 50
were so loose that summary judgment of invalidity was
justified. The district court emphasized that “participants
were under no obligation of confidentiality to Sunovion
(let alone Dey), and indeed, they were explicitly told that
they ‘may wish to discuss this study and your participa-
tion in it with your regular doctor.’” The court also re-
peated several times that there was “no evidence to
suggest that anyone involved in the study was ‘under
[any] limitation, restriction or obligation of secrecy to the
[putative] inventor’ or the putative inventor’s assignee,
Dey” and that such restrictions were necessary to render
the use non-public. In sum, the court concluded that “all
of the indicia of lack of confidentiality for the clinical trial
in this case, coupled with the plain lack of any control or
obligations to the patent holder, demonstrate that the
patented invention was in public use when Sunovion used
it in its clinical trial.”
Dey responds that a reasonable jury could find that
the particulars of its invention—embodied in the formula-
tion and stability characteristics of Batch 3501A—were
kept sufficiently confidential to avoid a finding of “public
use.” Investigators were the most knowledgeable persons
involved in the study, and they were required to sign a
pledge of confidentiality. The district court focused on the
study subjects, but as Dey points out, they were given
incomplete descriptions of the treatment formulation:
While they were informed about the active chemical
compound and the range of possible dosages being inves-
tigated, they were not even told the identity of the partic-
ular drug or formulation they were receiving. In other
words, according to Dey, while it is true that participants
were permitted to discuss the study with their doctors,
they were not in a position to reveal the composition of
the allegedly invalidating prior art, because they were
unaware of the specifics of the inventive formulations.
DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC. 11
Dey’s view of the record is a reasonable one. This case
does not involve undisputed evidence of a complete lack of
confidentiality protections, as there was in prior cases
basing invalidity on third-party public use. See Eolas,
399 F.3d at 1335; Baxter, 88 F.3d at 1058-59; Beachcomb-
ers, 31 F.3d at 1160. And the fact that no formal obliga-
tion of secrecy was imposed on the study subjects does not
automatically transform Sunovion’s clinical trial into a
public use. We have never required a formal confidential-
ity agreement to show non-public use, e.g., Bernhardt, 386
F.3d at 1379-81; in the absence of such an agreement, we
simply ask whether there were “circumstances creating a
similar expectation of secrecy,” Invitrogen, 424 F.3d at
1382. The “public use” inquiry is replete with factual
considerations, such as the (disputed) extent to which
study participants were informed of and able to disclose
the pertinent details of the claimed prior art. See, e.g.,
W.L. Gore, 721 F.2d at 1549. Because a finder of fact
could conclude that the study was conducted with a
reasonable expectation of confidentiality as to the nature
of the formulations being tested, summary judgment on
the public use issue was inappropriate.
Our conclusion is bolstered by the fact that the confi-
dentiality controls in Study 50 were far from unique. In
fact, Sunovion appears to have conducted its clinical trial
like many others, at least with respect to formal confiden-
tiality obligations and restrictions on information regard-
ing the drugs being studied. Most notably, clinical trial
subjects “typically do[] not sign a confidentiality agree-
ment,” as “patients must be free at least to provide infor-
mation to their other healthcare providers and family
members.” Allan Horwich, The Clinical Trial Research
Participant as an Inside Trader: A Legal and Policy
Analysis, 39 J. Health L. 77, 100 (2006); see also Norman
M. Goldfarb, Confidentiality Challenges in Clinical Trials,
J. of Clinical Res. Best Practices, May 2008, at 1, 2
(“Study subjects do not sign confidentiality agreements.”).
12 DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC.
In the specific context of section 102(b) cases, we find
strong parallels to the protocols of Study 50. Many cases
concern studies in which investigators sign strict confi-
dentiality agreements but patients do not, and courts
have routinely rejected the argument that such an ar-
rangement necessarily strips the trial of confidentiality
protection or renders it accessible to the public. See, e.g.,
Bayer Schering Pharma AG v. Barr Labs., Inc., No. 05-
CV-2308 (PGS), 2008 WL 628592, at *11-12, *38-42
(D.N.J. Mar. 3, 2008); Eli Lilly & Co. v. Zenith Goldline
Pharm., Inc., 364 F. Supp. 2d 820, 873-75, 912-13 (S.D.
Ind. 2005), aff’d, 471 F.3d 1369, 1380-81 (Fed. Cir. 2006);
Janssen Pharmaceutica N.V. v. Eon Labs Mfg., Inc., 374
F. Supp. 2d 263, 276 (E.D.N.Y. 2004), aff’d, 134 F. App’x
425, 430-31 (Fed. Cir. 2005); see also In re Omeprazole
Patent Litig., 490 F. Supp. 2d 381, 508 (S.D.N.Y. 2007)
(dismissing as “meritless” the contention that “inventions
were not kept sufficiently confidential” because “patients
were not required to sign confidentiality agreements”),
aff’d on other grounds, 536 F.3d 1361 (Fed. Cir. 2008). It
is not uncommon for patients in these studies to know the
active ingredient of the drug being studied. E.g., Bayer,
2008 WL 628592, at *12, *41 (such a disclosure did not
divulge “the alleged innovation” and was “necessary”
because “obviously . . . a participant taking a regimen of
drugs requires the liberty of discussing same with a
spouse, medical personnel in case of emergency, etc.”);
Janssen, 374 F. Supp. 2d at 276, aff’d, 134 F. App’x at
431. And, in at least one of those cases, patients also self-
administered the drug at home and did not return all
unused test products—an occurrence that the testimony
established is “‘very common’” in comparable trials.
Bayer, 2008 WL 628592, at *11-12, *38-42, *47.
DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC. 13
C
The district court’s decision was also premised on sev-
eral misconceptions about the reach of section 102(b).
First, the court found it significant that the patent holder,
Dey, did not control Sunovion’s clinical studies and that
study participants did not owe any obligation of confiden-
tiality to Dey. Those findings were based on language
from our cases stating that “[p]ublic use includes ‘any use
of [the claimed] invention by a person other than the
inventor who is under no limitation, restriction or obliga-
tion of secrecy to the inventor.’” E.g., Konrad, 295 F.3d at
1320 (emphasis added). As is clear from the context,
however, those statements are not meant to apply to
third-party use cases. If they did, any unaffiliated third-
party use, no matter how secret, would necessarily invali-
date a patent because such uses are, by definition, made
by persons not owing a duty of secrecy “to the inventor.”
Our third-party use precedent is not so limited. E.g., W.L.
Gore, 721 F.2d at 1549-50.
Instead, we measure the adequacy of the confidential-
ity guarantees by looking to the party in control of the
allegedly invalidating prior use. In third-party use cases,
that is the third party. In Eolas, therefore, we observed
that those who saw a demonstration by the third party,
Wei, “were under no limitation, restriction or obligation of
secrecy to Wei.” 399 F.3d at 1334; see also, e.g., Baxter, 88
F.3d at 1058-59; Konrad, 295 F.3d at 1320 (asking only
“whether there was any confidentiality obligation imposed
on persons who observed the use,” with no limitation on
its source). Because a secret third-party use is not invali-
dating, our task is to assess whether the third party’s use
was sufficiently “public” to impose the section 102 bar.
That Sunovion’s trial subjects owed no duty of confidenti-
ality to Dey is, of course, true, but it does not bear on that
question.
14 DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC.
Second, the district court seized on language in cases
dealing with the nature of the prior use, and based on
that language held that Study 50 is invalidating. In
particular, the district court cited New Railhead Mfg.,
L.L.C. v. Vermeer Mfg. Co., 298 F.3d 1290, 1299 (Fed. Cir.
2002), for the proposition that “the core issue is not public
knowledge of the invention, but the public use of it.”
Sunovion likewise points to cases such as Egbert v. Lipp-
mann, 104 U.S. 333 (1881), to contend that a “public use
need not be enabling in the sense of disclosing each later-
claimed feature to the interested public.” According to the
district court and Sunovion, it was not especially im-
portant whether test subjects knew or understood the
contours of the prior art alleged to anticipate Dey’s inven-
tions, because their at-home use of the formulation of
Batch 3501A without an affirmative confidentiality obli-
gation doomed Dey’s patents.
These arguments take the cited precedent out of con-
text and stretch it too far. The language quoted from New
Railhead derives from the seminal “experimental use”
case, City of Elizabeth v. American Nicholson Pavement
Co., 97 U.S. 126, 136 (1877), and it makes good sense in
that setting: During experimentation, the public might
have knowledge of an invention (because they see it), but
may not be using the invention within the meaning of the
statute (because the inventor is experimenting). 4 As for
Egbert, although the invalidating use in that case was not
4 In New Railhead, the invalidating public use took
place at a public commercial job site, with the knowledge
of the patentee inventor. 298 F.3d at 1293, 1298. “Com-
mercial exploitation is a clear indication of public use,”
even absent separate consideration of public accessibility,
Invitrogen, 424 F.3d at 1380, and “secret commercializa-
tion” by a third party is not public use, even if it might
have resulted in forfeiture were the third party the one
filing the patent application, W.L. Gore, 721 F.2d at 1550.
DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC. 15
visible to the general public, the case turned on the lack of
control the inventor maintained over his invention. The
Court held that an inventor could not give or sell the
invented article “to another, to be used . . . without limita-
tion or restriction, or injunction of secrecy” and still avoid
the public use bar. 104 U.S. at 336-37. Neither of those
cases, nor their progeny, permitted the district court to
discount the relevance of the study participants’ limited
knowledge of Batch 3501A’s formulation or to sidestep
disputed factual questions about the nature of the alleg-
edly public use. Put another way, although Sunovion is
correct that we do not ask for an “‘enablement-type in-
quiry’” under section 102(b), a court still must decide
whether the “claimed features of the patents [were placed]
in the public’s possession.” Konrad, 295 F.3d at 1323.
And here, a reasonable jury could conclude that if mem-
bers of the public are not informed of, and cannot readily
discern, the claimed features of the invention in the
allegedly invalidating prior art, the public has not been
put in possession of those features.
Finally, the district court attempted to distinguish
W.L. Gore and Eolas by holding that this case was not one
in which the third party, Sunovion, was using the inven-
tion confidentially or hiding a trade secret because Suno-
vion was “operating within the patent and regulatory
system,” not outside of it. That conclusion was based on
the fact that Sunovion was working to receive FDA ap-
proval and had received its own patent claiming “pharma-
ceutical compositions containing formoterol.” Sunovion
repeats the same argument throughout its brief on ap-
peal, pointing to its Gao patent as evidence that it did not
use Dey’s inventions confidentially.
These contentions may have resonated in a priority
contest, but they ring hollow here. The issue for purposes
of this appeal is not whether Sunovion pursued the proper
administrative channels in order to patent and develop its
invention, as reflected in the Gao patent; the issue is
16 DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC.
whether Sunovion kept its use of Dey’s inventions confi-
dential. And the only allegedly public use of Dey’s inven-
tions occurred in the context of a closely monitored
clinical trial, not in filing the Gao patent.
* * *
By allowing publicly accessible prior uses to block a
later-filed patent, the public use bar seeks to prevent
assigning a monopoly to “inventions that the public
reasonably has come to believe are freely available.” Tone
Bros., 28 F.3d at 1198. Study 50, with all of its re-
strictions on the use of the drugs and information con-
cerning the formulations, does not indisputably fall
within that description. Accordingly, we decline to hold,
on summary judgment, that Sunovion’s clinical trials of
its own product represent clear and convincing evidence
that Dey’s inventions were accessible to the public more
than a year before Dey sought to patent them. 5
5 The dissent agrees that the district court erred in
granting summary judgment to Sunovion but would go
farther and direct the entry of judgment for Dey. Our
decision is not intended to foreclose the district court from
entering summary judgment for Dey if the district court
determines to do so on remand. We think it appropriate,
however, to leave that decision to the district court. While
a reviewing court has the authority, on appeal from a
summary judgment in favor of the appellee, to direct the
entry of judgment in favor of the appellant, that course is
ordinarily followed only when the appeal involves issues
of law or when such a ruling would clearly entail no
unfairness to the appellee. See Fountain v. Filson, 336
U.S. 681, 683 (1949); Conoco, Inc. v. Dep’t of Energy, 99
F.3d 387, 394-95 (Fed. Cir. 1996); Turner v. J.V.D.B. &
Assocs., Inc., 330 F.3d 991, 998 (7th Cir. 2003) (“In most
instances, . . . such a decision is best made by the district
court; we would rarely find it appropriate to direct the
DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC. 17
REVERSED and REMANDED
entry of summary judgment.”). That is particularly true
in a case such as this one, in which the appellant has not
moved for summary judgment in the district court. See
Ramsey v. Coughlin, 94 F.3d 71, 74 (2d Cir. 1996) (in such
a setting, “great care must be exercised to assure that the
original movant has had an adequate opportunity to show
that there is a genuine issue and that his [or her] oppo-
nent is not entitled to judgment as a matter of law”).
Finally, Dey has not sought that relief from us and thus
has not put its opponent on notice that it is at risk of
having judgment directed against it. Dey asked that the
district court’s judgment be “vacated or reversed” but did
not ask us to direct the district court to enter judgment in
its favor. Although Sunovion may ultimately have noth-
ing of significance to add to the record in response to a
summary judgment motion from Dey, it should be given
the opportunity to do so, and the district court should be
given the opportunity to review its submission in the first
instance in light of our opinion. See 10A Charles Alan
Wright, Arthur R. Miller & Mary Kay Kane, Federal
Practice & Procedure, § 2720, at 354-55 & n.35 (1998)
(“Although it occasionally is proper for an appellate court
to enter summary judgment for the nonmoving party, this
occurs only in rare cases in which it is very clear that all
the material facts are before the reviewing court . . . .”).
United States Court of Appeals
for the Federal Circuit
______________________
DEY, L.P., DEY, INC., AND MYLAN, INC.,
Plaintiffs-Appellants,
v.
SUNOVION PHARMACEUTICALS, INC. (formerly
known as Sepracor, Inc.),
Defendant-Appellee.
______________________
2012-1428
______________________
Appeal from the United States District Court for the
Southern District of New York in No. 07-CV-2353, Judge
John G. Koeltl.
______________________
NEWMAN, Circuit Judge, dissenting.
I would reverse the district court’s judgment and hold
that Sunovion’s clinical trial does not constitute an inval-
idating “public use” of Dey’s invention. There are no facts
to be found, no debate as to how the trials were conduct-
ed. No sound reason appears for remanding for findings
or trial, when the matter is readily resolved on undisput-
ed facts. Nor is there any reason for casting judicial doubt
on the standard confidentiality procedures of clinical
trials, at this late date of decades of established practice.
It is not disputed that the patients who participated
in the trial were strictly limited by Sunovion’s policies
that prevented dissemination of drug samples and en-
2 DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC.
forced confidentiality on the administrators of the trial.
Although the patients were necessarily told the identity of
the active ingredient, the specific formulation and related
details were not disclosed to the patients. Nor was the
information published to the public, nor used outside of
the rigorous controls of FDA regulations of clinical trials.
There are no disputed facts, and no facts requiring finding
or that could be found to show that these trials were a
public use. The issue requires resolution, not perpetua-
tion. From the court’s decision to remand, I respectfully
dissent.
The patent statute, 35 U.S.C. § 102(b) (2006), bars a
patent on an invention in “public use” more than one year
before the date of the patent application:
§ 102 A person shall be entitled to a patent un-
less–
***
(b) the invention was patented or described in a
printed publication in this or a foreign country or
in public use or on sale in this country, more than
one year prior to the date of the application for pa-
tent in the United States . . .
“A bar under § 102(b) arises where, before the critical
date, the invention is in public use and ready for patent-
ing.” Invitrogen Corp. v. Biocrest Mfg., L.P., 424 F.3d
1374, 1379 (Fed. Cir. 2005). “The proper test for the
public use prong of the § 102(b) statutory bar is whether
the purported use: (1) was accessible to the public; or (2)
was commercially exploited.” Id. at 1380. To determine
whether the invention was “accessible to the public,”
courts consider such factors as “the nature of the activity
that occurred in public; the public access to and
knowledge of the public use; whether there was any
confidentiality obligation imposed on persons who ob-
served the use; whether progress records or other indicia
DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC. 3
of experimental activity were kept; whether persons other
than the inventor or acting for the inventor conducted the
experiments; how many tests were conducted; the scale of
the tests compared with commercial conditions; the length
of the test period in comparison with tests of similar
products; and whether payment was made for the product
of the tests.” Allied Colloids Inc. v. Am. Cyanamid Co., 64
F.3d 1570, 1574 (Fed. Cir. 1995). In short, a use “without
limitation or restriction, or injunction of secrecy . . . is
public.” Egbert v. Lippmann, 104 U.S. 333, 336 (1881).
Sunovion’s Batch 3501A was in clinical trial before
the critical date of Dey’s patents. Sunovion states that its
clinical trials were a “public” use because the patients did
not sign confidentiality agreements and knew that the
active ingredient was the known drug formoterol. Suno-
vion stresses that a few drug doses were lost during the
trial.
However, it was not disputed that the formulation of
Sunovion’s Batch 3501A was “confidential,” was “not
available to the public,” and was not known to the pa-
tients in the trial. The clinical investigators were subject
to strict written confidentiality agreements that prohibit-
ed the investigators from disclosing information designat-
ed by Sunovion as secret and any information the
investigators reasonably believed was “secret, confiden-
tial, or proprietary.” Clinical Investigator Confidentiality
Agreement, at 1, Sept. 21, 1999.
The trial subjects were only told the identity of the ac-
tive ingredient and the dosage being tested, which were
not novel aspects of Dey’s patents. The details of the
formulation and stability of Batch 3501A—the subject of
Dey’s patents—was not disclosed to the trial subjects.
Having not received this information, the clinical patients
were unable to disseminate Dey’s invention, even though
they were not subject to written confidentiality re-
strictions.
4 DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC.
Dey points out that Sunovion exercised great care to
avoid dissemination of the test material itself. During the
trial, Sunovion had a protocol expressly prohibiting
dispensing trial medication to any person who was not a
trial subject. The trial subjects were informed prior to
their participation that all unused medication was to be
returned to the investigator. Moreover, trial subjects
were carefully selected, in part based on their ability to
fill out logs accurately and create a precise record of their
use of the medication during the study.
On these undisputed facts, it cannot be held that the
trial was a “public use” pursuant to 35 U.S.C. §102(b). As
the panel majority observes, “courts have routinely reject-
ed the argument that such an arrangement necessarily
strips the trial of confidentiality protection or renders it
accessible to the public,” maj. op. at 12. For instance, in
Janssen Pharmaceutica v. Eon Labs Manufacturing, Inc.,
134 Fed. App’x 425, 431 (Fed. Cir. 2005), this court simi-
larly held that there was not public use where the clinical
trial “was confidential and controlled by Janssen” even
though “none of the subjects of the trials were bound by
confidentiality restrictions.” See also Bayer Schering
Pharma AG v. Barr Labs., Inc., No. 05-CV-2308 (PGS),
2008 WL 628592, *38–42 (D.N.J. Mar. 3, 2008) (finding no
public use even though “the human patients did not
execute confidentiality agreements”); Eli Lilly & Co. v.
Zenith Goldline Pharm., Inc., 364 F. Supp. 2d 820, 873–
75, 912-13 (S.D. Ind. 2005) (rejecting the contention that
failing to execute a confidentiality agreement constituted
a controlling factor in the public use inquiry), aff’d, 471
F.3d 1369, 1380–81 (Fed. Cir. 2006); In re Omeprazole
Patent Litig., 490 F. Supp. 2d 381, 508 (S.D.N.Y. 2007)
(“[T]he lack of a confidentiality agreement is not disposi-
tive as a matter of law [under 35 U.S.C. §102(b)], especial-
ly where [the movant] has come forth with no evidence to
demonstrate what material confidential information the
patients were privy to.”), aff’d on other grounds, 536 F.3d
DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC. 5
1361, 1372 (Fed. Cir. 2008). These holdings are con-
sistent with the policy of protecting the public’s justifiable
reliance by “discourag[ing] the removal of inventions from
the public domain which the public justifiably comes to
believe are freely available.” Am. Seating Co. v. USSC
Grp., 514 F.3d 1262, 1267 (Fed. Cir. 2008). Confidential
clinical trials subject to the restrictions of this protocol do
not engender such public reliance.
My colleagues state that material facts are in dispute,
and therefore that trial is necessary. However, the court
fails to identify any controverted facts. The facts of the
clinical trials are well-established in FDA records and are
uncontested by the parties. We know the formulation and
quantity of drug distributed; the number of trial partici-
pants; the terms of the investigators and participants’
participation agreements; the information disclosed to the
trial participants; and the restrictions on drug use and
distribution imposed by Sunovion. Moreover, both parties
agree that Batch 3501A used in Study 50 falls within
Dey’s patent claims. No pertinent fact remains at issue;
the only question is the legal conclusion of whether these
facts constitute a “public use” within the meaning of 35
U.S.C. §102(b). “Whether a public use has occurred is a
question of law.” Baxter Int’l, Inc. v. COBE Labs., Inc., 88
F.3d 1054, 1058 (Fed. Cir. 1996).
My colleagues state we should not decide whether
Sunovion’s clinical trial constitutes “public use” because
Dey “did not ask us to direct the district court to enter
judgment in its favor,” op. at 17 n.5. Dey’s primary ar-
gument to the district court was that “as a matter of law,
Sunovion’s confidential 050 clinical trial does not consti-
tute a public use of Dey’s invention.” Dey’s Mem. of Law
in Opp’n to Sunovion’s Mot. for Summ. J. at 1. Dey fairly
raised its legal argument to the district court, and Suno-
vion was given an opportunity to respond. The district
court was thus free to enter summary judgment for either
party. First Fin. Ins. Co. v. Allstate Interior Demolition
6 DEY, L.P. v. SUNOVION PHARMACEUTICALS, INC.
Corp., 193 F.3d 109, 114 (2d Cir. 1999) (“[I]f a motion for
summary judgment has been made, a district court may
grant summary judgment to any party—including a non-
movant.”).
On appeal, Dey requested that this court “vacate or
reverse” the district court’s judgment:
Whether the district court erred in holding that
Defendant-Appellee’s clinical trial, conducted un-
der confidentiality restriction’s by an alleged in-
fringer, constituted a “public use” of Plaintiff-
Appellants’ second patent family within the mean-
ing of 35 U.S.C. § 102(b), and in invalidating the
patents on that basis.
Statement of the Issue, Dey Br. at 3. We need go no
further than to answer the legal question presented: On
the uncontested facts, Sunovion’s clinical trial was not a
“public use” within the meaning of 35 U.S.C. §102(b).
On the undisputed facts, the legal question is readily
answered. The invention claimed in Dey’s patent was not
in “public use” in Sunovion’s clinical trials. I respectfully
dissent from the court’s refusal to resolve the question, for
there is nothing requiring further trial, whether to a jury
or to the bench.