Abbott Laboratories et al v. The Mathilda and Terence Kennedy Institute of Rheumatology Trust

Filing 101

ORDER re: 69 : The Court declines as a matter of discretion to empanel an advisory jury because a jury would not aid resolution of this complicated case. Accordingly, Abbott's motion to strike the jury demand is GRANTED. SO ORDERED. (Signed by Judge Paul A. Crotty on Setember 11, 2012) (mov)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

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USDCSDNY
DOCUMENT
ELECTRONICALLY FILED
DOC#:
DATE FILED: September 11, 2012

ABBOTT LABROTORIES and
ABBOTT BIOTECHNOLOGY LIMITED,
Plainti ffs,
- against ­

11 Civ. 2541 (PAC)

THE MATHILDA AND TERENCE KENNEDY
INSTITUTE OF RHEUMA TOLOGY TRUST,

ORDER

Defendant.

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HONORABLE PAUL A. CROTTY, United States District Judge:
Plaintiffs Abbott Laboratories and Abbott Biotechnology Ltd. ("Abbott") move to strike
Defendant The Mathilda and Terence Kennedy Institute of Rheumatology Ttust' s ("Kennedy")
demand for ajury trial on the issue of patent validity.
On April 13 , 2011, Abbott sought a declaratory judgll1ent that the claims of U.S. Patent
No . 7,846,442 (the "' 442 patent") issued to Kennedy are invalid for Obviousness-Type DoublePatenting of a prior patent issued to Kennedy, U.S. Patent No. 6,270,766 (the "'766 patent").
Kenned y's amended Answer raised five counterclaims, including a counterclaim for a declaratory
judgment that the '442 patent is "not invalid" (Answer ' 164), and a demand for "a trial by jury in
this action on all claims and issues triable of right by ajury." (rd. at 25.) By an order dated
August 10,2012, the Court stayed those counterclaims that do not relate to the validity of the '442
patent (and which may be subject to arbitration) pendin g trial on the parties' comp eting claims for
declaratory judgment regarding the validity of the '442 patent. The Court GRANTS Abbott 's
motion to strike Kennedy ' s demand for ajury trial on the issue of the ' 442 patent's validity.

The parties agree that whether a Seventh Amendment right to ajury tri al ari ses here is
governed by Tull v. United States, 48 1 U. S. 41 2 (19 87), which "turns on whether th e case ' is
more similar to cases that were tried in courts of law than to suits tried in courts of equity or
admiralty' in 179 1," when the Seventh Amendment was adopted. Tegal Com. v. Tokvo Electron
Am., Inc., 257 F.3 d 133 1, 1339 (Fed. C ir. 2001) (quoting Tull, 481 U.S. at 41 7». A right to a
ju ry tria l arises only if a case is more similar to those that were tried in courts of law. Id. This
inquiry requires a two-part evaluation of (I) the nature of th e action; and (2) the nature of th e
remedy sought. See ifL (citing Tull, 48 1 U.S. at 417-18». In this anal ysis, "the nature of the
remed y is more impol1ant th an th at of the action."

& (citing Chauffe urs, Local No. 391 v.

Terry, 494 U.S 558, 565 (1990); Tull, 48 1 U.S . at 417, 421

».

Whether a claim for a declaratory judgment, which did not exi st in 1791 , is properly
classified as legal or equitable turns on the underl ying controversy on w hich it is founded. In re
Lockwood, SO F.3d 966, 973 (Fed C ir. 1995), v acated SIS U.S . 11 82 (1995); ~ In re Tech.
Licensin g Corp., 423 F. 3d 1286, 1289 (Fed Cir. 2005) (per curiam).l In Lockwood, w here a
patentee brought an infringement action seeking damages and an injun ction and demanded a jury
trial, and the all eged infringer counterclaimed for a decl aration that the patents were inva lid, the
Federal Circ uit held that the closest eighteenth-century analog was a suit [or patent infrin gement
where an accused infringer pleaded invalidity as an affi nnativc defense. Lockwood, 50 F.3d at
974; Tech . Licensing, 423 F.3d at 1289. The court rul ed that such cases implicate the Seventh
Amendment's ri ght to a jury trial because a patentee in the eighteenth century had a choice as to
what remed y to seck [or infringement- ifthe patentee sought damages, the patentee brought an

Alth ough vacated by the Supreme Court without an opinion after Lockwood withdrew hi s requesl for a
Jury tnal, the Federal Ci rcu it has adopted Lockwood 's analysis in subsequent cases. See Tech. Licen sing,
423 F. 3d at 1288; Tegal, 257 F.3d at 1340.
I

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action at law (and the de fen se of invalidity would be tri ed to a jury); if the pate ntee sought only
to enjoin future acts of infringement, the patentee brought a suit in equity (and the defen se of
in va lidity wo uld be tri ed to the bench). See Lockwood, 50 F.3d at 976; Tech . Lice nsing, 42 3
FJd at 1289; Tegal, 257 F.3d at 1340-41. Applying this analysi s and emphasizing the
importance of the nature of the remedy sought, the Federal Circuit has held that the right to a
jury tri al ari scs in situations w here a patentee facing a claim or defen se of in validity would
otherwise be able to seek damages for infringement from the alleged infringer. See. e.g., Tech
Li censing, 423 F.3d at 1289-91 ; Tegal , 257 F.3 d at 1339-41 .
Here, the onl y issue at trial will be the parties' competing claims for declaratory
judgment regarding the validit y of the ' 442 patent. Since thi s claim does not seek damages fo r
patent infringement, Ke nnedy does not have a right to ajury tri al on the validity of th e '442
patent. See Tech. Licensing, 423 F.3d at 1289-91; Tegal , 257 F.3d at 133 9-41.
Kennedy's argument that it is entitled to a jury trial on the issu e of validity becau se it has
other counterclaims (stayed) that seek damages for unpaid royalties under a licensing agreement
and breach of contract is not persuasive. Federal Circuit precedent instructs that Seventh
Amendm ent analysis proceeds o n a claim by claim basis. See, e.g., Agfa Corp . v. C reo Prods ..
Inc., 451 F.3d 1366, 137 1-73 (Fed. Cir. 2006) (affirming district court deci sion to separate bench
trial on in equitable conduct from potential jury trial on infringement and invalidity) ; Gardco
Mfg., Inc. v. Herst Lighting Co., 820 F.2d 1209,1211-\ 3 (Fed. Cir. \987) (same) . The Federal
Rules of Ci vil Procedure and the reasoning behind the Tull test suppo rt thi s approach. See Fed.
R. Civ. P. 39(a)(2) ("When ajury trial has been demanded ... the trial on all issues so demanded
must be by a jury unless ... the court . .. fmds that on so me or all o[tho se issues the re is no
federal right to ajury trial. " ); Tull, 48 1 U. S. at 41 7-18.

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The Court detetmines that the analysis in Medlmmune, Inc . V. Gcnentech, Inc. , 535 F.
Supp. 2d 1020 (CD. Ca l. 2008), is compelling. There, a patent li censee sought a declaratory
judgment that a patent was in va lid, unenfo rceable , and not infringed by the li censee.

l!L at

102 1.

After the patentee stipulated that it would not sue the licensee for infringement, the only claims
that remain ed before the court were for declaratory judgments of the rights and obligations under
the license agreement, invalidity of the patent, and unenfo rceabi lity 0 f th e patent. lQ" at 102 1-22.
T he licensee then mo ved to strike the paten tee ' s demand [or a jury trial. The court, anal yzin g

each oCthc c laims at issue indi vidu all y, held th at nojury trial ri ght ex isted on the contract claim
because the patentee co nceded it could not seek damages as the contract had not been breached.

lQ" at I 023. Addressing the patent validit y claim, the court applied the Fede ral C ircuit ' s
Lockwood analysis, hi ghli ghting the centrality of the nature of the relief so ught, and held that
because the patentee co uld no l assert a claim for infringement damages no right to a jury trial
cx isled on th e patent validity issue. lQ" at I 029. Here, K ellJ1ed y cannot assert a elaim [or
infringem ent damages where the only issue at trial will be the patiies' compet ing claims for
declaratory judgment regarding the validit y of the '442 patent.
The Co urt declines as a matter of di sc retion to empanel an ad visory jury because a jury
would nOl a id reso lution of thi s complicated case . Accord ingly, Abbott ' s mOL to strik e the
ion
jury demand is GRANTED.
Daled: New York, New York
September II , 20 12

PAUL A CROTTY
United States District Judge

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