Abbott Labs. v. Andrx Pharm., Inc., No. 06-1101, __ F.3d __ (Fed. Cir. 2007).
While this is not a Northern District case, it is relevant to the Blog because it is an appeal of a Northern District case and because it confirms Judge Coar’s ruling (discussed here) that a preliminary injunction holding lacked preclusive effect in the related case Abbott Labs. v. Sandoz, Inc., No. 05 C 5373, 2006 WL 3718025 (N.D. Ill. Dec. 15, 2006). In this patent dispute plaintiff, Abbott Laboratories ("Abbott"), alleged that defendant’s, Andrx Pharmacueticals ("Andrx") sale of a generic form of Abbott’s patented extended release antibiotic (clarithromycin, an erythromycin derivative) which Abbott markets as Biaxin XL. The Northern District held that Abbott had established a likelihood of success on the merits of its infringement claim and that Andrx had not established a likelihood that the patent would be held invalid. As a result of those holdings, the Northern District issued a preliminary injunction. In its appeal, Andrx argued that Abbott was precluded from obtaining a preliminary injunction because the Federal Circuit overturned a previous Northern District preliminary injunction for Abbott against another generic antibiotic producer Teva Pharmaceuticals ("Teva"). In that case, the Federal Circuit held that Teva raised a substantial question as to the validity of the claims at issue, sufficient to call Abbott’s likelihood of success on the merits into question.
The Federal Circuit, applying Seventh Circuit law, held that preliminary injunctions would be given preclusive effect only in the "rare instances" that the injunction raised an "insuperable obstacle" to plaintiff’s success on the merits. Because the Court did not find an insuperable obstacle to Abbott’s success on the merits, the denial of a preliminary injunction against Teva had no preclusive effect in this case. As a result, the Federal Circuit upheld the Northern District’s preliminary injunction.
The Federal Circuit’s reasoning appears to square with Judge Coar’s reasoning in the Sandoz case. In Sandoz, the Court held that preliminary relief holdings have no preclusive effect because they are made on an incomplete record, "inherently tentative" and based upon only "an estimate of the likelihood of success." Despite the fact that the Federal Circuit’s denial of the preliminary injunction lacked preclusive effect, however, the Court ultimately refused to reach a holding inconsistent with the Federal Circuit’s without a "substantial showing" on a more complete record. So, although the Court denied the TRO, it appeared to remain open to a preliminary injunction based upon a more complete record.