United States District Court, D. New Jersey
OPINION & ORDER
STANLEY R. CHESLER, U.S.D.J.
matter comes before the Court on the motion by Defendants
Camber Pharmacuticals, Inc. and Invagen Pharmaceuticals, Inc.
(collectively, “Defendants”) to declare this an
exceptional case, pursuant to 35 U.S.C. § 285 and for
attorneys' fees. For the reasons that follow, the motion
will be granted.
case arises from a patent infringement dispute involving a
pharmaceutical, calcium acetate capsules. Plaintiff Roxane
Laboratories, Inc. (“Roxane”) owns U.S. Patent
No. 8, 563, 032 (the “'032 patent”), directed
to a pharmaceutical calcium acetate formulation; Roxane
markets a generic calcium acetate capsule product. Defendants
are pharmaceutical manufacturers who market competing generic
calcium acetate capsule products. To make a long story short,
Roxane brought this suit for patent infringement against
Defendants and lost. Defendants now move, pursuant to 35
U.S.C. § 285, for a declaration that this is an
exceptional case and for an award of their attorneys'
fees and costs spent in defending this action.
governing statute for attorney's fees in a patent case
states that “[t]he court in exceptional cases may award
reasonable attorney fees to the prevailing party.” 35
U.S.C. § 285. The Supreme Court has defined an
“exceptional” case as “simply one that
stands out from others with respect to the substantive
strength of a party's litigating position (considering
both the governing law and the facts of the case) or the
unreasonable manner in which the case was litigated.”
Octane Fitness, LLC v. Icon Health & Fitness,
134 S.Ct. 1749, 1756 (2014). “[A] district court may
award fees in the rare case in which a party's
unreasonable conduct-while not necessarily independently
sanctionable-is nonetheless so ‘exceptional' as to
justify an award of fees.” Id. at 1757.
courts may determine whether a case is
‘exceptional' in the case-by-case exercise of their
discretion, considering the totality of the
circumstances.” Id. at 1756; see also
Highmark Inc. v. Allcare Health Mgmt. Sys., Inc., 134
S.Ct. 1744, 1748 (2014) (“[T]he determination of
whether a case is ‘exceptional' under § 285 is
a matter of discretion.”). In examining the totality of
the circumstances under § 285's fee-shifting
framework, courts may consider the following nonexclusive
list of factors: “frivolousness, motivation, objective
unreasonableness (both in the factual and legal components of
the case) and the need in particular circumstances to advance
considerations of compensation and deterrence.”
Octane Fitness, 134 S.Ct. at 1756 n.6 (citation
determining that a case is exceptional, the district court
must determine whether attorney fees are appropriate, ”
a decision that is within the discretion of the district
court. Cybor Corp. v. FAS Techs., Inc., 138 F.3d
1448, 1460 (Fed. Cir. 1998) (citations omitted). The party
seeking an award of attorney's fees must show their
entitlement by a preponderance of the evidence standard.
Octane Fitness, 134 S.Ct. at 1758.
contend that Plaintiff's infringement claim was
objectively unreasonable and that Roxane pursued the
litigation in a manifestly unreasonable manner. Because this
Court finds that the case is exceptional based on the
objective unreasonableness of Roxane's patent
infringement claim, it need not reach Defendants'
arguments about Roxane's conduct of the litigation.
evidence of objective unreasonableness, Defendants point to a
number of statements and decisions made by this Court and by
the Federal Circuit over the course of the litigation.
first point to the statement made by this Court in its
Opinion denying Roxane's motion for a preliminary
In brief, the key obstacle for Roxane is found in the
undisputed facts that claim 1 of the '032 patent requires
a “capsule that is size 00 or less, ” while the
accused infringing products are capsules that are size
and Order of August 6, 2014 at 3-4.) Because capsule sizes
are standardized in the pharmaceutical industry, and because
size 00el capsules are larger than size 00 capsules,
Defendants argue that these undisputed basic facts mandate
the conclusion that Roxane had no objectively reasonable
factual or legal basis for its patent infringement suit.
appealed this Court's preliminary injunction decision to
the Federal Circuit, which, on March 12, 2015, affirmed the
decision without opinion. Roxane Labs., Inc. v. Camber
Pharms., Inc., 596 Fed.Appx. 922 (Fed. Cir. 2015).
Defendants argue that the Federal Circuit's decision
should have ended Roxane's pursuit of the case, but it
did not do so. The litigation proceeded to claim
next point a statement this Court made in its claim
construction decision. After reviewing the undisputed basic
facts noted above, and observing that the evidence of record
showed that the pharmaceutical industry has clear standard
capsule sizes, the Court stated: “Roxane has made a
concerted effort to inject confusion into this fairly simple
and straightforward matter.” (Opinion and Order of July
15, 2015 at 4.) Defendants contend that this clearly let
Roxane know that it had made no progress toward demonstrating
a factual or legal basis for its patent infringement claim.
principle argument for patent infringement was that the claim
term “size 00” meant a “family” of
capsule sizes, which included the size “00el”
capsules used by Defendants. This Court first expressed its
skepticism about the reasonableness of this position in a
footnote in the preliminary injunction decision: “At
the outset, the Court wonders about the use of the
‘family' metaphor here. Are there really capsule
size families that make up the capsule size community?”
(Opinion and Order of August 6, 2014 at 4 n.1.) At that
point, the record did not contain any evidence which
supported the theory that either the pharmaceutical industry
or the inventors employed a concept of capsule size families.
Then, in the claim construction decision, this Court
carefully examined the intrinsic evidence and found no
support for the capsule size family theory. On appeal, the
Federal Circuit scrutinized this Court's claim
construction analysis and agreed with it. Roxane Labs.,
Inc. v. Camber Pharms. Inc., 666 Fed.Appx. 899, *16
(Fed. Cir. Nov. 17, 2016).
contend that this evidence demonstrates that Roxane had no
objectively reasonable basis to support its claim of patent
opposition, Roxane relies on three points: 1) Roxane's
claim construction position had merit; 2) this Court's
denial of summary judgment pending claim construction shows
that Roxane's position was not objectively unreasonable;
and 3) Roxane's offer to stipulate to non-infringement
after claim construction demonstrates good faith.
As to the merit of its claim construction position, Roxane
As an initial matter, Roxane's claim construction
positions had merit. Roxane's fundamental position was
that capsule size is a technical term of art, whose ordinary
meaning encompasses elongated and non-elongated versions.
Roxane anchored its proposed construction in the intrinsic
evidence, and explained why it did not show an intent by the
patentees to use a different meaning, let alone the requisite
clear and unmistakable intent that the law requires. As
additional evidence of the ordinary meaning, Roxane relied on
extensive extrinsic evidence, whose implications Defendants
and their experts disputed. Roxane continually developed the
evidence and ultimately submitted a final claim construction
proposal to the Court.
(Pl.'s Br. 2.) This is not an accurate account of the
litigation. It is correct that Roxane's fundamental claim
construction position was that the ordinary meaning of
“size 00” was “the capsule size family
consisting of size 00 and size 00el.” (See
Pl.'s PI Br. 12 (“Such a capsule is by its own
designation part of the size “00” family, and is
therefore a pharmaceutically acceptable capsule that is size
00 or less.”)). Roxane anchored its proposed
construction in the extrinsic evidence, not the intrinsic
evidence. While it did address the intrinsic
evidence in its PI reply brief, its arguments were meritless.
While Roxane may have developed the record after the
preliminary injunction hearing by finding the PTAB hearing
transcript, Roxane never developed any stronger or better
arguments based on the intrinsic evidence.
absent from Roxane's opposition to this motion is any
example of a claim construction argument based on the
intrinsic evidence that had arguable merit. Roxane now
asserts that its position had merit, but provides no support
for that. Roxane has not, at any point in this litigation,
made a colorable argument that the intrinsic evidence
supports its theory that the ordinary meaning of “size
00” is “the capsule size family consisting of
size 00 and size 00el.” As will be discussed further
below, the pursuit of a patent infringement claim based on
such a weak position is extraordinary.
next argues that this Court's denial of summary judgment
pending claim construction shows that Roxane's position
was not objectively unreasonable. The facts about the denial
of summary judgment are as follows. On October 24, 2014,
Defendants moved for partial summary judgment of
non-infringement. Fundamental to Defendants' motion was
the argument that district courts have considerable
discretion as to the procedure for claim construction, and
the request that this Court construe the “size
00” claim term in deciding the motion for partial
summary judgment. (Defs.' Br. 11, Docket Entry No. 137.)
Roxane then wrote a letter in which it argued that the motion
was premature, as it was premised on the completion of
“formal claim construction proceedings.” (Docket