FEDERAL CIRCUIT FINDS VENUE PREMISED ON FUTURE INFRINGING SALES IMPROPER IN HATCH-WAXMAN SUITS
Last week, in Valeant Pharmaceuticals North America LLC v. Mylan Pharmaceuticals Inc., the Federal Circuit held that venue based on “acts of infringement” in Hatch-Waxman cases must be predicated “on past acts of infringement—i.e., acts that occurred before the action alleging infringement was filed.” In ANDA cases, “those acts occur only in districts where actions related to the ANDA submission occur.”
The decision answered a looming question over the impact of the Supreme Court’s decision in TC Heartland LLC v. Kraft Food Grp. Brands LLC, which held that venue is proper either where the defendant is incorporated or where it has a place of business and committed an act of infringement. Since that decision, district courts have struggled to reconcile the language in the patent venue statute, which requires an act of infringement that occurred in the past, and the language of the Hatch-Waxman Act, which focuses on potential future acts. Because of this, a split emerged between the various district courts. Some courts, most notably the District of Delaware, determined that future acts of infringement were relevant to the venue analysis and that, consequently, ANDA suits could be filed in almost any district. Other courts, including the Northern District of Texas, concluded that the venue statute requires a past act of infringement, and that the plain language of the Hatch-Waxman Act does not identify any past act of infringement besides the ANDA submission. Under this line of reasoning, venue was limited to those districts where acts related to filing the ANDA occurred. Although it noted valid policy concerns relating to lost judicial efficiencies in handling multi-defendant cases, the Federal Circuit adopted the latter approach.
As a result of the Federal Circuit’s holding, venue in Hatch-Waxman cases no longer extends to all judicial districts where a generic product is likely to be distributed. Instead, it is proper only in districts where acts sufficiently related to the ANDA submission occurred. As the Federal Circuit succinctly summarized: “it is the submission of the ANDA, and only the submission, that constitutes an act of infringement in this context.”