Looking Beyond the Label for Inducement in Post-Launch Case
Addressing objections to a magistrate’s report and recommendation, a Delaware district court held that a generic manufacturer’s label showing an intent to induce infringement was not enough on its own to establish induced infringement in a post-launch case, and that evidence of actual inducement was required. GlaxoSmithKline LLC v. Glenmark Pharms. Inc., USA, Case No. 14-cv-877 (D. Del., June 9, 2017) (Stark, J). The court found that post-launch cases differ from pre-launch cases, since evidence of actual inducement (if such occurred) would be available in the former but not the latter.
The dispute before the court arose from a magistrate judge’s report and recommendation regarding a summary judgment motion by the defendants seeking a finding of no induced infringement. Induced infringement requires a plaintiff to show both intent to induce infringement and actual inducement. Courts tend to focus on the intent element as evidenced by a generic drug’s label in pre-launch Hatch-Waxman cases, because there can be no evidence of actual inducement before a drug is on the market.
Defendants argued that because this was a post-launch case, evidence of intent based on the label was not sufficient to support a finding of inducement. They moved for summary judgment, arguing that they had introduced undisputed evidence that doctors do not actually read the drug label when prescribing, so there could be no actual inducement. Plaintiffs disagreed, arguing both that the label was sufficient evidence of inducement on its own regardless of the drug’s launch status and that whether the label actually induced infringement was a genuinely contested issue of fact. The magistrate agreed with defendants that plaintiffs would have to show evidence of actual inducement, but denied summary judgment on the basis that plaintiffs had introduced sufficient circumstantial evidence of inducement to survive summary judgment.
Both sides objected to the magistrate’s order. Plaintiffs again argued that there was a per se rule that intent to induce infringement as shown by a generic label is sufficient for a finding of induced infringement, and defendants argued that the magistrate had erred in finding a genuine issue of material fact.
Judge Stark overruled both parties’ objections and adopted the magistrate’s report. In doing so, he made clear that there is a valid reason for distinguishing between inducement in pre-launch and post-launch cases based on the evidence available. He also clarified, however, that plaintiffs need not provide direct evidence of actual inducement in order to prevail on an induced infringement claim. Instead, “so long as there is circumstantial evidence that could lead a factfinder to believe that the alleged acts of encouragement led to some amount of ‘successful communication’ between the alleged inducer . . . and the third-party direct infringer,” the induced infringement standard would be satisfied.
Practice Note: Be aware of the distinctions between the induced infringement standards for pre-launch and post-launch cases, and adjust your case theories accordingly.