A Special Discovery Master in Celgene Corp. v. Hetero Labs Ltd., No. 17-3387 (D.N.J. Mar. 29, 2021)1 recently issued a Report and Recommendation requiring defendants to move to amend their invalidity contentions to add dozens of prior art references that defendants’ experts relied on, but which defendants failed to disclose in their invalidity contentions.
The court emphasized the purposes underpinning the local patent rules’ disclosure requirements, which “require parties to crystallize their theories of the case early in the litigation” and “adhere to those theories once they have been disclosed.” The court found that references used solely for background purposes, like educating the court or demonstrating the treatment options available at the time of invention, and references that refine or develop previously disclosed invalidity theories did not need to be disclosed in the invalidity contentions.
The court cautioned, however, that it would look past defendants’ labeling of prior art references to determine if the references are actually used to support defendants’ obviousness analysis, explaining that “‘
[c]
lever labels’ won’t be allowed to do an end run around the Local Patent Rules.” Consequently, undisclosed prior art that advances a new theory of invalidity, contains the claim elements at issue, or that verges sufficiently close to the specifics of the claims, should have been disclosed in the invalidity contentions.
Concerning previously undisclosed prior art combinations, the invalidity contentions disclosed 18 “exemplary combinations” along with a statement that defendants reserve the right to rely on any combination of references. Defendants argued that the disputed combinations were disclosed in claim charts, which stated “Defendants incorporate by reference the arguments made in the accompanying Invalidity Contentions.” The court found that this disclosure ran afoul of both the text and purpose of the local patent rules and rejected defendants’ “circular ‘incorporation by reference’ incantation” which makes it “impossible to identify the actual combinations that Defendants will ultimately present in their case,” and does nothing to crystallize defendants’ theories of the case.
Defendants asserting invalidity in the District of New Jersey should be prepared to disclose all potential invalidating art along with specific combinations at the invalidity contentions stage, or risk not being able to rely on undisclosed art and combinations at trial.
Thanks to R. Willets Ely, law student at the University of Minnesota Law School, for his contributions to this post.
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1 Celgene commenced this action in 2017, alleging infringement of its method-of-treatment and formulation patents for the drug Pomalyst®, which is used to treat multiple myeloma.