Shire Wants Jury Trial Over Validity Of Its Genetic Disorder IP

By Jeff Montgomery
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Law360 (June 17, 2020, 9:31 PM EDT) -- Shire ViroPharma Inc. said Wednesday that it wants to seek a federal jury trial in Delaware on the validity of its patents for a genetic disorder treatment in a dispute with CSL Behring LLC, despite the difficulties posed by the COVID-19 pandemic and ongoing court activity restrictions.

The trial demand figured prominently in the two companies' separate responses to U.S. District Judge Mitchell S. Goldberg's request last week for their positions on the use of bench trials to address patent validity disputes and CSL counterclaims asserting inequitable conduct by Shire.

Shire told the judge that it would assert its constitutional right to a jury trial if the court ruled out summary judgment disposition first on the inequitable judgment claims. Invalidity claims — involving matters of law — would have to be put to jurors first before the judge could conduct a bench trial on CSL's equity-based counterclaims because of common facts underlying the two issues Shire argued.

"Shire appreciates that the COVID-19 pandemic has increased strain on the judicial system, making a jury trial in the near future logistically difficult," the company said in its letter. "Shire, however, shares the court's interest in moving this case forward."

The federal court building in Delaware began the first phase of its COVID-19 reopening plan on Wednesday. But there's no prospect of a jury trial before the next and as-yet unscheduled phase of the four-step process. While grand jury proceedings resumed under the first phase, Chief Judge Leonard P. Stark's order directed them to be limited to urgent matters and held in larger spaces.

At issue in the Shire-CSL case are Shire allegations that CSL's Haegarda medication infringed Shire's patents for a treatment for hereditary angioedema, a reference to sudden severe swelling of tissues, including those in the face, limbs, throat and intestines.

Shire sued CSL on April 11, 2017, the same day it received its patent for a prophylactic medication administered under the skin, rather than intravenously. Although the company argued that binding precedent allows the choice of a jury trial to determine invalidity, CSL disagreed and pointed Judge Goldberg to "multiple instances" where courts made the decision.

"The Supreme Court made clear that the validity of a patent is a 'public right' and, as such, the validity of a patent can be adjudicated by legislative courts and administrative agencies without implicating the Seventh Amendment right to a jury trial," CSL argued. The company noted that patent validity is often determined by agencies rather than juries, including proceedings before the Patent Trial and Appeal Board.

CSL Behring argued that it had "several bases for inequitable conduct by Shire in this case," including failure to submit material information to the U.S. Patent and Trademark Office, among others. It added that the two sides agreed earlier this month that the court, not a jury, should handle the equitable claims.

"Moreover, controlling Federal Circuit precedent holds that the court may try inequitable conduct before the issues of infringement and invalidity are tried to a jury," CSL argued.

Attorneys for Shire, however, said that there was no support for CSL suggestions that court precedent allows an override of Shire's right to a jury trial.

The U.S. Food and Drug Administration approved CSL's Haegarda in June 2017, and the company launched the treatment weeks later.

Shire alleged direct infringement, inducement of infringement, contributory infringement and willful infringement. CSL countered with claims that Shire's patents are invalid, unenforceable and not infringed, and it accused Shire of inequitable conduct, among other reasons, for incorrect assertions of inventorship and omissions of inventors.

Shire ViroPharma LLC is represented by Karen Jacobs and Derek J. Fahnestock of Morris Nichols Arsht & Tunnell LLP, Eric J. Marandett, Daniel C. Winston, G. Mark Edgarton, Anita M.C. Spieth and Bryana T. McGillycuddy of Choate Hall & Stewart LLP and Edgar H. Haug of Haug Partners LLP.

CSL Behring LLC and CSL Behring GmbH are represented by John W. Shaw, Karen E. Keller, David M. Fry and Nathan R. Hoeschen of Shaw Keller LLP, Sanya Sukduang and Jonathan Davies of Cooley LLP, Amanda K. Murphy, Candice R. Jones and Anthony C. Tridico of Finnegan Henderson Farabow Garrett & Dunner LLP.

The case is Shire ViroPharma Inc. v. CSL Behring LLC, case number 17-cv-00414, in the U.S. District Court for the District of Delaware.

--Editing by Haylee Pearl.

Correction: An earlier version of the story included an attorney who no longer represents CSL Behring.

For a reprint of this article, please contact reprints@law360.com.

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