Mandamus inappropriate unless no other way to get relief, even if result is unnecessary trial

February 04, 2008
Post by Blog Staff

In a precedential order last week, the Federal Circuit denied a petition for a writ of mandamus seeking to direct a district court to vacate its summary judgment order in favor of a patent infringement plaintiff and to enter judgment in favor of the alleged infringer. The district court's order did not completely resolve the case, but did prevent the alleged infringer from presenting several defenses, including that it was either the actual owner of or had obtained a license under the asserted patents, as well as challenging the plaintiff's standing.The court held that the fact that the defendant "may suffer hardship, inconvenience, or an unusually complex trial does not provide a basis for a court to grant mandamus," and that mandamus should only be granted when there is "no other means of obtaining the relief desired." Here, because the issues raised would be reviewable after trial on a traditional appeal, the court rejected the petition for mandamus.Judge Newman dissented. In her opinion, it was apparent that the district court had likely made errors in its determination of the parties' summary judgment motions. As a result, she would have granted the petition in order to review these issues and avoid what may otherwise be an unnecessary trial.More detail of In re Roche Molecular Sys., Inc. after the jump.This case involves a patent infringement lawsuit brought by Stanford University against Roche in the Northern District of California. Roche asserted on summary judgment that its acquisition of another company, Cetus, resulted in Roche obtaining either a license under the asserted patents or ownership of those patents. This claim was based on two contracts between Cetus and Stanford executed in 1988, when the claimed inventions were being developed.The first contract was a Materials Transfer Agreement (MTA) whereby Cetus agreed to train and assist Stanford scientists with its PCR (polymerase chain reaction) research. The district court stated:

The contract granted Cetus, by default, a free non-exclusive license. The contract further permitted Cetus to exercise an option to pay royalties for exclusivity. Either way Cetus' right to use the inventions was secured by the MTA.
Additionally, a Stanford scientist executed a Visitor Confidentiality Agreement (VCA) based on the scientist's unrestricted access to Cetus' materials, equipment, etc. In regard to the second agreement the district court stated:
He spent nine months working on site at Cetus, using Cetus equipment and materials and obtaining advice from Cetus personnel, and that he developed a PCR assay "with assistance from Cetus scientists while [he] was at Cetus."
The district court also found that Stanford developed a PCR assay that was claimed in the patents at issue after working with Cetus, and as a result, under the agreement, the patents may have rightfully belonged to Cetus. Roche asserted that, as a result of its acquisition of Cetus, that it either had a license under the patents or was the owner of those patents. The district court rejected this position however, holding that such claims were barred by California's four-year statute of limitations for contracts. The court also held that the licenses were void under the Bayh-Dole Act. As a result, Roche could not claim it either owned or licensed the patents in defense on the charge of patent infringement On this basis, Roche sought a writ of mandamus to order the district court to enter judgment in its favor.The Federal Circuit denied the petition for writ of mandamus in a brief, per curiam order. According to the court, the fact that the defendant "may suffer hardship, inconvenience, or an unusually complex trial does not provide a basis for a court to grant mandamus." Further, the court noted that mandamus should only be granted when there is "no other means of obtaining the relief desired." Here, because the issues raised would be reviewable on a appeal after trial, the court rejected the petition for mandamus.Judge Newman dissented from the court's denial of the petition, stating that material errors of law justified granting the petition. In her analysis, the petition involved an extraordinary situation requiring the court's intervention. First, Judge Newman stated the district court incorrectly failed to determine Roche's license rights involving the technology in dispute, due to the holding that the defense was barred by a California statue of limitations. Judge Newman pointed out that under California law, a defense "may be raised at any time, even if the matter alleged would be barred by a statute of limitations if asserted as the basis for affirmative relief." She was equally doubtful of the district court's conclusion regarding the Bayh-Dole Act. Specifically, Judge Newman observed that the Bayh-Dole Act's purpose is to be "an incentive, not a bar, to university-industry collaboration and commercial development through licensing." Based on these errors regarding these fundamental issues in the case, Judge Newman concluded the "stringent standard" for mandamus was met. As stated by Judge Newman: "Judicial economy, as well as resolution of uncertainty, weight heavily toward mandamus review instead of waiting until after a potentially unnecessary trial, as this court holds."This puts Roche in an unenviable position. Based on Judge Newman's analysis, it appears Roche is at least reasonably likely to win on appeal. However, under the court's ruling, Roche must go through an arguably unnecessary trial (and spend a fair amount of time and money) in order to reach that appeal. Roche's best hope is that the district court reads Judge Newman's dissent and reverses its previous ruling, allowing the case to proceed to appeal immediately.To read the full order in In re Roche Molecular Sys., Inc., click here.

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