Biaxin Litigation: Sandoz' Motion for Stay Pending Appeal Denied by District Court

Abbott Labs v. Sandoz (N.D. Ill. 2007) (05 C 5373).

Abbott and Sandoz are in a tussle over Abbott’s patented clarithromycin antibiotic (BIAXIN). Abbott sued Sandoz and was granted a preliminary injunction in April 2007. Sandoz immediately requested a stay of the preliminary injunction pending appeal to the Federal Circuit. 

Under FRCP 62(c), a district court “in its discretion” may suspend or modify a preliminary injunction pending resolution of an interlocutory appeal.  In Hilton v. Braunskill (non-patent), the Supreme Court discussed the four-factors used to determine whether to stay pending appeal:

1. Movant’s strong showing of potential success on appeal;
2. Movant’s potential irreparable injury if stay is denied;
3. Potential injury to patentee if stay is granted; and
4. The public interest.

Here, potential success on appeal must refer to success in appealing the preliminary injunction — a much easier showing than success on the merits of the case as a whole. And the party’s “strong showing” of potential success does not need to reach even a 50% chance of winning on appeal — If the movant’s chances on appeal were greater than 50% then no PI should have issued in the first place.

Based on KSR, Sandoz argued a strong likelihood that the patent would be found obvious.  The district court, however, disagreed, finding that none of the prior art disclosed a claim limitation relating to PK levels.

There was no indication that either prior art disclosed the specific PK limitations of claim 1 and 4, and thus, there was no indication that the prior art would motivate a person of ordinary skill in the art to combine their teachings to arrive at the '718 patented invention. After reading the Supreme Court's KSR opinion, this Court is left with the understanding that the need to demonstrate the presence of all claim limitations in the prior art (when the legal theory is based upon obviousness due to the combination of prior art teachings) has not been obviated.

Motion to stay denied. The PI will thus stay in force unless released by the CAFC on appeal.

• The CAFC has already adjudged two PI cases regarding the patents-in-suit — affirming a PI against ANDRX and vacating a PI against Teva.
• Cases Discussing Stay Pending Appeal:
• Hilton v. Braunskill, 481 U.S. 770 (1987);
• Hinrichs v. Bosma, 440 F.3d 393 (7th Cir. 2006).