Case 1:10-cv RGA Document 129 Filed 07/19/12 Page 1 of 5 PageID #: 1811 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

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1 Case :0-cv RGA Document 29 Fied 07/9/2 Page of 5 PageD #: 8 N THE UNTED STATES DSTRCT COURT FOR THE DSTRCT OF DELAWARE BRSTOL-MYERS SQUBB COMPANY, Paintiff, v. Civi Action No RGA TEVA PHARMACEUTCALS USA, NC, Defendant. MEMORANDUM ORDER This is a case invoving the vaidity of a patent that caims "entecavir." (D.., ~ 4). ) ' ; Before the Court is the Paintiffs Motion for Partia Summary udgment ofno nequitabe Conduct. (D.. 95). t is premised on faiure of the inventor (Dr. Zaher) and the two patent prosecuting attorneys (Venetianer and Davis) to discose to the PTO prior art reating to the compound 2'-CDG. There are in the record "information discosure statements" signed by one or the other ofthe attorneys, dated October 2, 990 (Venetianer) (D ), and September 7, 99 (Davis) (D.. 07-). The Venetianer discosure statement references the duty to discose and provide "patents, pubications or other information which may be materia to the examination of [the appication that resuted in the patent at issue in this case]." The Davis discosure statement references the duty to discose and "incudes what [Davis] beieves to be the most reevant art." Neither information discosure statement incudes anything about 2'-CDG. The Defendant ped inequitabe conduct as its "Seventh Affirmative Defense." (D.. 54,! t t t f }

2 Case :0-cv RGA Document 29 Fied 07/9/2 Page 2 of 5 PageD #: 82 \! r f pp. 7-2). The parties have retained experts who have offered opinions about the materiaity of 2'- CDG as prior art to the patent. Compare D.. 0, Exh. 3, pp (Dr. Heathcock- "materia") and D.. 2, Exh. 6, pp (Dr. Schneer- "entecavir is not structuray simiar to [2'-CDG]"). The appicabe aw is set forth in the recent Therasense decision of the Federa Circuit: To prevai on a caim of inequitabe conduct, the accused infringer must prove that the patentee acted with the specific intent to deceive the PTO. A finding that the misrepresentation or omission amounts to gross negigence or negigence under a "shoud have known" standard does not satisfy this intent requirement. "n a case invoving nondiscosure of information, cear and convincing evidence must show that the appicant made a deiberate decision to withhod a known materia reference." n other words, the accused infringer must prove by cear and convincing evidence that the appicant knew of the reference, knew that it was materia, and made a deiberate decision to withhod it. i \ i. This requirement of knowedge and deiberate action has origins in the trio of Supreme Court cases that set in motion the deveopment of the inequitabe conduct doctrine. n each of those cases, the patentee acted knowingy and deiberatey with the purpose of defrauding the PTO and the courts. ntent and materiaity are separate requirements. A district court shoud not use a "siding scae," where a weak showing of intent may be found sufficient based on a strong showing of materiaity, and vice versa. Moreover, a district court may not infer intent soey from materiaity. nstead, a court must weigh the evidence of intent to deceive independent of its anaysis of materiaity. Proving that the appicant knew of a reference, shoud have known of its materiaity, and decided not to submit it to the PTO does not prove specific intent to deceive. Because direct evidence of deceptive intent is rare, a district court may infer intent from indirect and circumstantia evidence. However, to meet the cear and convincing evidence standard, the specific intent to deceive must be "the singe most reasonabe inference abe to be drawn from the evidence." ndeed, the evidence "must be sufficient to require a finding of deceitfu intent in the ight of a the circumstances." Hence, when there are mutipe reasonabe inferences that may be drawn, intent to deceive cannot be found. This court reviews the district court's factua findings regarding what reasonabe inferences may be drawn from the evidence for cear error. 2

3 Case :0-cv RGA Document 29 Fied 07/9/2 Page 3 of 5 PageD #: 83 Because the party aeging inequitabe conduct bears the burden of proof, the "patentee need not offer any good faith expanation uness the accused infringer first... prove[ s] a threshod eve of intent to deceive by cear and convincing evidence." The absence of a good faith expanation for withhoding a materia reference does not, by itsef, prove intent to deceive. Therasense, nc. v. Becton, Dickinson & Co., 649 F.3d 276, (Fed. Cir. 20) (en bane) (citations and parentheticas to citations omitted; emphases in origina). Therasense was intended to cut back on inequitabe conduct as a defense. The Federa Circuit said as much. ts emphasis on the doctrine originating with three Supreme Court cases ~ invoving either bribery or perjury or both is teing. For present purposes, given the summary judgment posture, the Defendant has to produce sufficient evidence so that the inequitabe conduct defense can go to the factfinder. Whie the Defendant's burden at tria is to "prove by cear and convincing evidence that the appicant knew of the reference, knew that it was materia, and made a deiberate decision to withhod it," the ony issue at this time is whether at east one of the three accused individuas knew that the withhed information was materia and made a deiberate decision to withhod it. See D.. 96, p.6 n.0. The Paintiff has cited deposition testimony from the inventor and the two attorneys to the effect that they did not make any intentiona decision to withhod the prior art, and/or that they did not consider the prior art to have been materia. Paintiff urges that this testimony presents a reasonabe aternative basis for not providing the prior art, and that therefore "intent to deceive cannot be found." cannot accept that argument, because it woud require that find the testimony of the inventor and the attorneys to be credibe. Whie uncontradicted sworn testimony may be accepted on summary judgment, there is evidence in the record that cautions 3

4 Case :0-cv RGA Document 29 Fied 07/9/2 Page 4 of 5 PageD #: 84 against accepting the testimony without giving the opportunity for a fu hearing. The "materiaity" question is one on which two experts differ, and do not know which one am going to accept. Part of the "materiaity" question invoves the supposed structura simiarity of 2'-CDG and entecavir. The experts have different opinions on that. The inventor is one of severa peope credited with an artice which contains a statement about 2'-CDG's "structura simiarity" to entecavir. (D.. 0, Exh. 8, p.446). The inventor, when questioned about the artice, said he had neither written nor read it before it was pubished. (D.. 24, pp. 6-7). Such a statement at east raises a credibiity concern. do not think making the credibiity decision on summary judgment in this case is appropriate. am mindfu of what the Federa Circuit has said about inferring intent from materiaity. note that the Court said may not infer intent "soey" from materiaity. That does not prohibit me, think, from considering materiaity as a piece of circumstantia evidence in ooking at intent. n this case, since the inventor has agreed that he knew about 2'-CDG, if it were to tum out from the expert testimony that were to concude that 2'-CDG were the "smoking gun," that is something woud want to know before deciding intent. have aso considered that the issue here invoves the state of mind of three individuas about twenty years ago. t is often difficut to prove someone's state of mind about something the person did yesterday. To prove by cear and convincing evidence that a person intended to deceive the PTO twenty years ago, in the absence of any direct evidence that he did so, is about as difficut as cimbing Mt. Everest. cannot say, however, as a matter of aw that it cannot be done. See Aventis Pharma SA. v. Hospira, nc., 675 F.3d 324, (Fed. Cir. 202) (affirming a finding of an inventor's intent to deceive in 990). Therefore, this _:; of uy 202, the Paintiffs Motion for Partia Summary udgment 4

5 Case :0-cv RGA Document 29 Fied 07/9/2 Page 5 of 5 PageD #: 85 ofno nequitabe Conduct (D.. 95) as to the inventor (Dr. Zaher) and the two attorneys is ' DENED. The Paintiff's Motion for Partia Summary udgment ofno nequitabe Conduct!! (D.. 95) as to the second inventor (Dr. Susarchyk), which is not opposed (D.. 09, p. 3 n.; D.. 24, p.2, n.), is GRANTED. t 5