In Gilead Sciences, Inc. v. Merck & Co., [2016-2302, 2016-2615] (April 25, 2018), the Federal Circuit affirmed the district court’s determination that the claims the jury found to be valid and infringed were unenforceable because of pre-litigation business misconduct\u00a0and litigation misconduct attributable to Merck.<\/p>\n
The Federal Circuit looked the the Supreme Court’s decision in\u00a0Keystone Driller Co. v. General Excavator\u00a0Co., for an explanation of unclean hands — there the Court held that a determination of\u00a0unclean hands may be reached when \u201cmisconduct\u201d of a\u00a0party seeking relief \u201chas immediate and necessary relation\u00a0to the equity that he seeks in respect of the matter in\u00a0litigation,\u201d i.e., \u201cfor such violations of conscience as in\u00a0some measure affect the equitable relations between the\u00a0parties in respect of something brought before the court.\u201d\u00a0 The Federal Circuit noted that Merck argued that the connection between the misconduct and the litigation must be “material,” but failed to make clear to the Federal Circuit had that requirement affected the case.\u00a0 The Federal Circuit noted that in the present case\u00a0which involves clear misconduct in breaching commitments\u00a0to a third party and clear misconduct in litigation,\u00a0the \u201cimmediate and necessary relation\u201d standard, in its\u00a0natural meaning, is met if the conduct\u00a0normally would enhance the claimant\u2019s position regarding\u00a0legal rights that are important to the litigation if the\u00a0impropriety is not discovered and corrected.\u00a0 The Federal Circuit found that considering the conduct as a whole the district court’s determination of unclean hands was adequately supported.<\/p>\n
Specifically, the district court found that Merck violated the “firewall” understanding between Merck and Pharmasset, when at least one person involved in a conference call with Pharmasset was involved, and continued to be involved in Merck related patent prosecution, which the Federal Circuit characterized as “serious misconduct,
\nviolating clear standards of probity in the circumstances.”\u00a0 The improperly acquired knowledge\u00a0influenced Merck\u2019s\u00a0filing of narrowed claims, a filing that held the potential\u00a0for expediting patent issuance and for lowering certain\u00a0invalidity risks.<\/p>\n
The district court also found litigation misconduct, first in giving knowing false deposition testimony (presumably to hide the business misconduct) and false trial testimony. The Federal Circuit agreed with the district court that Merck\u2019s litigation misconduct infects
\nthe entire lawsuit, including the enforceability of the other patents in the suit.<\/p>\n
Because the district court did not abuse its discretion\u00a0in applying the doctrine of unclean hands, the Federal Circuit affirmed.<\/p>\n","protected":false},"excerpt":{"rendered":"
In Gilead Sciences, Inc. v. Merck & Co., [2016-2302, 2016-2615] (April 25, 2018), the Federal Circuit affirmed the district court’s determination that the claims the jury found to be valid and infringed were unenforceable because of pre-litigation business misconduct\u00a0and litigation … Continue reading