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Edwards Lifesciences AG v. Corevalve, Inc.

United States District Court, D. Delaware

April 15, 2014

EDWARDS LIFESCIENCES AG and EDWARDS LIFESCIENCES LLC, Plaintiffs,
v.
COREVALVE, INC. and MEDTRONIC COREVALVE LLC, Defendants.

MEMORANDUM

GREGORY M. SLEET, Chief District Judge.

I. INTRODUCTION

On February 12, 2008, plaintiffs Edwards Lifesciences AG and Edwards Lifesciences LLC ("Edwards") filed suit against CoreValve, Inc. and Medtronic CoreValve LLC ("Medtronic"). (D.I. 1.) In its complaint, Edwards alleged that Medtronic infringed U.S. Patent No. 5, 411, 552 ("the '552 patent"), U.S. Patent No. 6, 168, 614 ("the '614 patent"), and U.S. Patent No. 6, 582, 462 ("the '462 patent"). (id.)[1] On March 23, 2010, trial commenced regarding the '552 patent. On April 1, 2010, a jury returned a judgment in favor of Edwards against Medtronic, finding that the CoreValve Generation 3 ReValving System ("CoreValve Generation 3"[2]) literally infringed claim 1 of the '552 patent and that the infringement was willful. (D.I. 313.) The jury awarded Edwards $72, 645, 555.00 in lost profits for infringement and $1, 284, 861.00 as a reasonable royalty.[3] ( Id. )

On November 26, 2013, Edwards brought a motion for preliminary injunction seeking to enjoin Medtronic from continuing to infringe claim 1 of the '552 patent by selling the CoreValve Generation 3 as soon as Medtronic obtained FDA approval. (D.I. 548-49.) On March 4, 2014, the court ordered an evidentiary hearing "concerning the public interest considerations implicated by the plaintiffs' motion, as well as the response and reply thereto, and the carve-out proposal in the plaintiffs' motion". (D.I. 586 (order setting an evidentiary hearing for April 11, 2014).) At the full-day evidentiary hearing on April 11, 2014, each of the parties engaged in oral argument and examined and cross-examined witnesses regarding the public interest factor of the preliminary injunction motion. (D.I. 593 (official transcript of the April 11, 2014 evidentiary hearing).) At the conclusion of the evidentiary hearing, and after considering both the parties' briefs and the evidence introduced at the hearing, the court granted in part and denied in part Edwards' motion for preliminary injunction.[4] (D.I. 593 at 256: 1-260:8.) The court's reasoning is provided in greater detail below.

II. BACKGROUND

Both Edwards and Medtronic are in the business of making and selling transcatheter heart valves ("THV" or "TAVI"). (D.I. 549 at 6; D.I. 560 at 3-4.) Edwards makes the SAPIEN line of THVs, (D.I. 549 at 2), while Medtronic makes the Medtronic CoreValve System for transcatheter aortic valve implantation, (D.I. 560 at 1). Medtronic is Edwards' only competitor in the United States. (D.I. 549 at 1.) The '552 patent, of which Edwards AG is the assignee and Edwards LLC the exclusive licensee, (D.I. 1 at ¶ 10), is titled "Valve Prothesis [sic] for Implantation in the Body and a Catheter for Implanting such Valve Prothesis [ sic ]". The '552 patent discloses medical technology for implanting prosthetic valves into patients' aortic annuluses by means of a catheter. (D.I. 52 at 1.) In essence, this invention allows a prosthetic heart valve to be delivered through the skin to patients' aortic annuluses and thereby avoids traditional open heart surgery and its accompanying risks. ( Id. )

On May 2, 2012, the term of the '552 patent expired. (D.I. 560 at 5.) Subsequently, the U.S. Patent Office ("PTO") granted two one-year extensions, extending the patent's term to May 2, 2014 pursuant to 35 U.S.C. § 156. (D.I. 560 at 5.) Edwards anticipates that the PTO will ultimately extend the term of the '552 patent to March 22, 2016. (D.I. 549 at 12.) Despite the April 2010 verdict in which the jury found that Medtronic was a literal and willful infringer of the '552 patent, Medtronic has continued to make the CoreValve Generation 3. (D.I. 549 at 10.) There is evidence that Medtronic may have sought to stockpile infringing devices in the United States after the verdict as part of a greater plan to overtake Edwards in the THV market. (D.I. 549 at 7, 10.)

Prior to FDA approval of the CoreValve Generation 3, Medtronic was able to make the CoreValve Generation 3 available to extreme risk patients through the FDA-sanctioned Continued Access clinical trial. (D.I. 560 at 9.) In their initial briefing, the parties reported that Medtronic planned to launch the CoreValve Generation 3 in the United States as soon as it received FDA approval for commercial sale of the CoreValve Generation 3 in extreme risk patients. (D.I. 549 at 2, 7; D.I. 560 at 9.) In the time that has elapsed since the parties submitted their briefs, the FDA has approved the CoreValve Generation 3. (D.I. 582-1 (FDA letter dated January 17, 2014 stating that the CoreValve Generation 3 is approved.).) The FDA approved sale of the CoreValve Generation 3 in the United States without also approving extension of the continued access program through which Medtronic was providing the CoreValve Generation 3 to extreme risk patients.[5] (D.I. 582-1.) Thus, the continued access program must now end and Medtronic claims that the only way that extreme risk patients will be able to access the CoreValve Generation 3 will be if Medtronic makes the device commercially available as soon as possible. (D.I. 560 at 9.)

The parties agree that Edwards will almost certainly gain FDA approval to replace the SAPIEN with a next-generation product, the SAPIEN XT, at any time now. (D.I. 550 at ¶ 7 (explaining that Edwards expects to gain FDA approval in early 2014); D.I. 560 at 5.) As a result, Medtronic's CoreValve Generation 3 and Edwards' SAPIEN XT could be entering the market for commercial sales around the same time. (D.I. 550 at ¶ 7.)

III. LEGALSTANDARD

To secure a preliminary injunction under Section 283, the movant must establish four factors: "(1) the likelihood of success on the merits of the underlying litigation, (2) whether irreparable harm is likely ifthe injunction is not granted, (3) the balance of hardships as between the litigants, and (4) factors of the public interest." Abbott v. Sandoz, 544 F.3d 1341, 1344 (Fed. Cir. 2008); see also AstraZeneca LP v. Apotex, Inc., 633 F.3d 1042, 1049 (Fed. Cir. 2010) ("A plaintiff seeking a preliminary injunction must establish that [it] is likely to succeed on the merits, that [it] is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in [its] favor, and that an injunction is in the public interest.") (Citations omitted). The court must balance all four factors, but the court may grant the preliminary injunction where "the weakness of the showing regarding one factor is overborne by the strength of the others." Chrysler Motors Corp. v. Auto Body Panels of Ohio, Inc., 908 F.2d 951, 953 (Fed. Cir. 1990). Although the court has full discretion over the decision to grant a preliminary injunction, "a preliminary injunction is a drastic and extraordinary remedy that is not routinely granted." Intel Corp. v. ULSI Sys. Tech., Inc., 995 F.2d 1566, 1568 (Fed. Cir. 1993).

IV. DISCUSSION

A. Likelihood of Success on the Merits

Edwards contends that it has already succeeded on the merits because of the jury verdict in its favor and the conclusion of the appellate process. (D.I. 549 at 12-13.) Medtronic, on the other hand, contends that Edwards has yet to succeed on the merits because the rights on which Edwards motion are based allegedly expired with the '552 patent. (D.I. 560 at 11.) According to Medtronic's reading of 35 U.S.C. § 156, since Edwards based its extension only on the SAPIEN, Edwards' rights are limited to copies of the SAPIEN and do not cover any devices, such as the CoreValve Generation 3, that are not copies of the SAPIEN. (D.I. 560 at 11-12.) In response, Edwards argues that Medtronic's contentions have no basis in the statutory language of Section 156. (D.I. 570 at 3.) The court concludes that Edwards is correct.

Section 156(b)(1)(A) provides that "the rights derived from any patent the term of which is extended under this section shall during the period during which the term of the patent is extended (1) in the case of a patent which claims a product, be limited to any use approved for the product (A) before the expiration of the term of the patent[.]" (Emphasis added.) Thus, the language of the statute makes clear that the rights secured by the extension of the '552 patent are limited by the approved use of the SAPIEN, not just copies of the SAPIEN. The case law also makes clear that Section 156 applies to uses of devices, not merely the actual devices and copies thereof. See, e.g., Ortho-McNeil Pharm., Inc. v. Lupin Pharm., 603 F.3d 1377, 1382 (Fed. Cir. 2010) (Explaining that the rights secured by Section 156(b) apply to uses of the product.) (Citation omitted); Boehringer lngelheim lnt'l GmbH v. Barr Labs., Inc., 592 F.3d 1340, 1349 (Fed. Cir. 2010) (Explaining that the plaintiff "had the right to exclude the use then under regulatory review"-namely the use of pramipexole for the treatment of the signs and symptoms of idiopathic Parkinson's disease...."') (Citation omitted).

Ultimately, in order to establish a likelihood of success on the merits, a patentee must show that "it will likely prove infringement of one or more claims of the patents-in-suit, and that at least one of those same allegedly infringed claims will also likely withstand the validity challenges presented by the accused infringer." AstraZeneca LP v. Apotex, 633 F.3d 1042, 1050 (Fed. Cir. 2010) (citations omitted). Since Edwards has outright prevailed in the litigation regarding the '552 patent and the appeals process is over, the court concludes that Edwards has more than demonstrated a likelihood of success on the merits.

B. Irreparable Harm

The purpose of the irreparable harm inquiry is to "measure harms that no damages payment, however great, could address." Celsis in Vitro v. CellzDirect, 664 F.3d 922, 930 (Fed. Cir. 2012) (citations omitted). Of the numerous forms of irreparable harm that Edwards lists in its briefs and declarations in support, the court finds Edwards' arguments regarding price erosion and loss of sales, market share and revenue to be most convincing. Thus, the court concludes ...


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