ROBERTS, J., for the Court:
¶ 1. This litigation centers on a dispute over a warranty deed. John Walton had obtained power of attorney for his mother, Jacqueline L. Hudson. Jacqueline had reserved a life-estate interest in the property that was later the subject of the warranty deed at issue. Aside from the life-estate, John and his brother, Kenneth Walton, had been deeded the legal rights to the property. In 1997, John utilized his power of attorney for Jacqueline to execute the warranty deed at issue, thereby conveying Jacqueline's life-estate interest to himself.
¶ 2. In September 2008, John's nephew, Justin Walton, filed a complaint to set aside the warranty deed. Justin named John and his other uncle, Kenneth, as defendants. John filed a motion to dismiss Justin's complaint. According to John, Justin's complaint was barred by the applicable statute of limitations. John also argued that, because Jacqueline only transferred her life-estate interest in the 1997 warranty deed, setting aside the warranty deed would not pass any real interest to Jacqueline's estate. Finally, John requested attorney's fees and sanctions pursuant to Rule 11 of the Mississippi Rules of Civil Procedure.
¶ 3. The chancellor ultimately granted John's motion to dismiss and his motion for Rule 11 sanctions. The chancellor awarded John and Kenneth a judgment of $1,000 against Justin. Aggrieved, Justin appeals. After careful consideration, we affirm the chancellor's decision to grant John's motion to dismiss. We also affirm the chancellor's finding that Rule 11 sanctions are appropriate, but we reverse the chancellor's finding regarding the amount of sanctions awarded and remand that question to the chancery court for further proceedings consistent with this opinion.
FACTS AND PROCEDURAL HISTORY
¶ 4. This dispute is among the descendants of Edward and Jacqueline Walton. Edward and Jacqueline had three sons: George, John, and Kenneth Walton. George died in 1984. He had one son, Justin. Justin was five or six years old when George died.
¶ 5. On December 12, 1989, Edward and Jacqueline executed a warranty deed. Within that deed, they transferred their ownership in six parcels of land to John and Kenneth as tenants in common. However, Edward and Jacqueline reserved a life-estate in all six parcels.
¶ 6. Edward died in 1990. The events surrounding the administration of Edward's estate are at issue in a separate set of proceedings that Justin has initiated. Within his brief, Justin claims that John and Kenneth misrepresented Edward's assets during the administration of Edward's estate. Justin also claims that John and Kenneth intentionally failed to mention him as one of Edward's heirs-at-law when they filed a petition for appointment of administrators. Justin also claims that neither he nor his mother as his guardian were served with John and Kenneth's petition for appointment of administrators. According to Justin, John and Kenneth intentionally sought to exclude him from inheriting his father's share of Edward's estate. However, John and Kenneth point out that, by virtue of notice through Justin's mother, Mary Lou Boles, Justin challenged the final accounting of Edward's estate. John and Kenneth also state that Justin's attorney later withdrew because he was unable to contact Mary. Finally, John and Kenneth state that, despite having notice of the proceedings, neither Justin nor Mary appeared at the conclusory hearing on Edward's estate. The allegations surrounding the administration of Edward's estate have no bearing on the outcome of this opinion. We merely mention these proceedings and the fact that Justin has challenged these proceedings for the sake of continuity and clarity.
¶ 7. On June 16, 1995, John had Jacqueline execute a power of attorney. On August 7, 1997, John used his authority pursuant to the power of attorney to execute a warranty deed, conveying Jacqueline's life-estate interest in one of the six parcels of land described in the 1989 deed to himself. Additionally, Kenneth also transferred his interest in that parcel to John.
¶ 8. Jacqueline died on May 18, 2006. On September 26, 2008, Justin filed a petition in the Hinds County Chancery Court in which he sought to set aside the 1997 warranty deed. Justin named John and Kenneth as defendants. On November 6, 2008, John filed a motion to dismiss Justin's petition. John also requested Rule 11 sanctions against Justin.
¶ 9. The chancellor's judgment, filed on December 18, 2008, contains a statement that the chancellor conducted a hearing on John's motion to dismiss on the same date that the judgment was filed. In his brief, Justin states that he was not present at that hearing. In any event, the chancellor granted John's motion to dismiss. The chancellor also granted John's request for sanctions against Justin. However, the chancellor awarded John and Kenneth a judgment of $1,000 against Justin. Aggrieved, Justin appeals. He claims the chancellor erred when he granted John's motion to dismiss. Justin also claims that the chancellor erred when he awarded John and Kenneth sanctions.
ANALYSIS I. THE MOTION TO DISMISS
¶ 10. Justin raises multiple arguments regarding what he considers to be improprieties surrounding the chancellor's decision to grant John's motion to dismiss. We are mindful that we are to utilize a de novo standard of review when considering whether a trial court erred when it granted a motion to dismiss. Harris v. Miss. Valley State Univ., 873 So.2d 970, 988 (¶ 54) (Miss. 2004). Furthermore, "the allegations in the complaint must be taken as true, and the motion should not be granted unless it appears beyond a reasonable doubt that the plaintiff will be unable to prove any set of facts in support of his claim." Id. (citing T.M. v. Noblitt, 650 So.2d 1340, 1342 (Miss. 1995)).
¶ 11. Justin claims that the chancellor's decision to grant John's motion to dismiss was improper because: (1) the minor savings provision of Mississippi Code Annotated section 15-1-7 (Rev. 2003) tolled the statute of limitations; (2) John and Kenneth's fraudulent concealment tolled the statute of limitations; and (3) the chancellor failed to view the evidence in the light most favorable to the non-moving party. However, whether the statute of limitations was tolled is irrelevant if Justin's complaint failed to state a claim upon which relief could be granted.
¶ 12. Justin sought to set aside the 1997 warranty deed. The 1997 warranty deed stemmed from the 1989 warranty deed, in which Edward and Jacqueline conveyed six parcels of land to their two living sons, John and Kenneth. Edward and Jacqueline reserved a life-estate in those six parcels of land.
¶ 13. Having acquired power of attorney for Jacqueline, John executed the 1997 warranty deed on Jacqueline's behalf. The 1997 warranty deed addressed one of the six parcels of land that were transferred in the 1989 warranty deed. Accordingly, through John and his authority pursuant to the power of attorney, Jacqueline transferred her life-estate in that parcel of land to John. In effect, John utilized the power of attorney to transfer a property interest to himself.
¶ 14. However, setting aside the 1997 warranty deed would have no practical effect. Jacqueline died in May 2006. Pursuant to the 1989 warranty deed, when Jacqueline died, her life-estate lapsed. If the 1997 warranty deed was set aside, the 1989 warranty deed would still be in effect, and the 1989 warranty deed would still have transferred the six parcels of property to John and Kenneth. It is undisputed that Justin has sought to set aside the 1989 warranty deed in separate proceedings. Nothing in this opinion should be taken as res judiciata regarding those proceedings. We merely find that, pursuant to the precise circumstances of this case, Justin's complaint failed to state a claim upon which relief could be granted. Accordingly, we find no merit to this issue.
II. SANCTIONS
¶ 15. Although Justin named both John and Kenneth as defendants, the motion for Rule 11 sanctions was only brought in John's name. In the "motion for Rule 11 sanctions," John claimed that he had "incurred attorney[`s] fees to defend this frivolous action." John also claimed that Justin "filed this action solely for the purpose of harassing [him and that Justin] should be sanctioned accordingly." On appeal, Justin argues that the chancellor erred. We review the chancellor's decision to award Rule 11 sanctions pursuant to the abuse-of-discretion standard. Illinois Cent. R. Co. v. Broussard, 19 So.3d 821, 823 (¶ 8) (Miss.Ct.App. 2009).
¶ 16. Pursuant to Rule 11(b), a trial judge may order a party to pay expenses or attorney's fees "[i]f any party files a motion or pleading which, in the opinion of the court, is frivolous or is filed for the purpose of harassment or delay." M.R.C.P. 11(b). A pleading is frivolous pursuant to Rule 11 if "objectively speaking, the pleader . . . has no hope of success." Broussard, 19 So.3d at 824 (¶ 11). The pivotal point in time to assess a party's or an attorney's actions is the instant when the signature is placed upon the document. Thomas v. Capital Sec. Servs., Inc., 836 F.2d 866, 874 (5th Cir. 1988).
¶ 17. The chancellor's judgment references a hearing that occurred on December 18, 2008, but the record does not contain a transcript of that hearing. The chancellor's judgment also states that "[t]he Defendant's Motion for Rule 11 Sanctions against . . . Justin . . . is granted." Accordingly, the chancellor held that both John and Kenneth "are awarded a Judgment of One Thousand Dollars . . . against Justin." However, the chancellor did not explicitly find that Justin's complaint was frivolous or that it was filed for the purpose of harassment or delay. The chancellor could have found that Justin's complaint was frivolous, because Justin had no hope of success when he filed his complaint. As previously mentioned, setting aside the 1997 warranty deed would have had no practical effect on John's ownership of the property mentioned within that deed.
¶ 18. "While the court may find a case appropriate for the award of attorney's fees, the actual award of attorney's fees is still dependent upon specific proof." Romney v. Barbetta, 881 So.2d 958, 962 (¶ 20) (Miss.Ct.App. 2004). The standard of proof regarding an award of attorney's fees is as follows:
In determining an appropriate amount of attorney[`]s fees, a sum sufficient to secure one competent attorney is the criterion by which we are directed. The fee depends on consideration of, in addition to the relative financial ability of the parties, the skill and standing of the attorney employed, the nature of the case and novelty and difficulty of the questions at issue, as well as the degree of responsibility involved in the management of the cause, the time and labor required, the usual and customary charge in the community, and the preclusion of other employment by the attorney due to the acceptance of the case.
McKee v. McKee, 418 So.2d 764, 767 (Miss. 1982) (internal citation omitted).
¶ 19. There is no evidence regarding attorney's fees in the record. The record does not contain any documentation regarding the time that John's attorney spent responding to Justin's complaint. Likewise, the record does not contain any evidence regarding the per-hour rate that John's attorney charged. There is a complete lack of evidence regarding any matter addressed in McKee. What is more, John alone filed the motion for Rule 11 sanctions. There is no indication that Kenneth joined in John's motion. In fact, there is no indication that Kenneth has ever participated in these proceedings. Even so, the chancellor awarded "John Walton and Kenneth Walton . . . a Judgment of One Thousand Dollars . . . against Justin." Finally, the chancellor's award is ambiguous in that it is unclear whether John and Kenneth each received a judgment of $1,000 or whether they were both to receive an equal portion of a single $1,000 judgment.
¶ 20. This Court has affirmed a party's liability for attorney's fees pursuant to Rule'11 and then found plain error in a chancellor's actual award. In re Spencer, 985 So.2d 330, 339 (¶ 31) (Miss. 2008). In that case, the Mississippi Supreme Court found plain error in a chancellor's award of fees in excess of the proof, vacated the chancellor's judgment regarding the precise value of the award, and remanded for a factual finding of the amount of reasonable attorney's fees. Id. at 339-40 (¶ 31). We follow a similar course of action in this case. Based on the lack of evidence in the record, the fact that Kenneth was not a movant in the motion for Rule 11 sanctions, and the ambiguity regarding the calculation of the judgment, we find plain error in the chancellor's award of attorney's fees. However, we find no abuse of discretion regarding the chancellor's implied decision finding that Justin's complaint was frivolous. Accordingly, we remand this matter to the chancellor for a factual finding of the amount of reasonable attorney's fees incurred by filing John's motion to dismiss and his motion for Rule 11 sanctions.
¶ 21. THE JUDGMENT OF THE HINDS COUNTY CHANCERY COURT IS AFFIRMED IN PART AND REVERSED AND REMANDED IN PART FOR FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION. ALL COSTS OF THIS APPEAL ARE ASSESSED TO THE APPELLANT.
KING, C.J., LEE AND MYERS, P.JJ., IRVING, GRIFFIS, BARNES, ISHEE AND MAXWELL, JJ., CONCUR.
ication or use (Def. Ex. C (Yasmin Label)), Bayer contends that "patented FDA-approved uses may reside outside (even wholly outside) the Indications section of the label." (Bayer Br. 2) In the alternative, Bayer contends that the issue of
whether the `652 patent's method-of-use has been FDA-approved presents "a question of fact unsuitable for resolution on the pleadings." (
Id.)
In arguing that Yasmin is FDA-approved for the method-of-use covered by the `652 patent, Bayer cites to, inter alia, the "Clinical Pharmacology" section of Yasmin's FDA-approved label, to the fact that the `652 patent is listed in the Orange Book, and to its marketing materials, which apparently promote Yasmin for uses other than oral contraception. None of these arguments, however, refutes undisputed evidence — including the "Indications and Usage" section of Yasmin's FDA-approved label and the FDA's letter approving Bayer's NDA for Yasmin — that Yasmin is only FDA-approved for use as an oral contraceptive. Bayer cites no law for the novel proposition that the FDA-approved indication for a drug can be expanded by references on the label to side effects noted in pre-clinical studies, by a listing in the Orange Book, or by — of all things — a pharmaceutical company's promotional materials for its drug.
The "Indications and Usage" section of Yasmin's FDA-approved label, as well as the FDA's letter approving Bayer's NDA for Yasmin, make clear — as a matter of law — that the FDA has approved Yasmin only for use as an oral contraceptive. Because the only FDA-approved use of Yasmin is oral contraception, and because the FDA has not approved the method-of-use set forth in the `652 patent, Defendants are entitled to judgment on the pleadings concerning Bayer's infringement claims.
A. Section 271(e)(2)(A) Claims 1. Applicable Law
In Warner-Lambert Co. v. Apotex Corp., 316 F.3d 1348 (Fed. Cir. 2003), the Federal Circuit considered "whether it is an act of infringement under 35 U.S.C. § 271(e)(2)(A) to submit an ANDA seeking approval to make, use, or sell a drug for an approved use if any other use of the drug is claimed in a patent, or if it is only an act of infringement to submit an ANDA seeking approval to make, use, or sell a drug if the drug or the use for which FDA approval is sought is claimed in the patent." 316 F.3d at 1354 (emphasis in original). The Warner-Lambert court concluded that "it is not an act of infringement to submit an ANDA for approval to market a drug for a use when neither the drug nor that use is covered by an existing patent, and the patent at issue is for a use not approved under the NDA." Id. at 1354-55. Stated another way, the Warner-Lambert court "held that a method of use patent holder may not bring an action under section 271(e)(2) for infringement of a method of use patent that does not claim a FDA-approved use." Allergan, 324 F.3d at 1333-34; see also Warner-Lambert, 316 F.3d at 1354 ("Congress clearly intended to limit actions for infringement of method-of-use patents under § 271(e)(2)(A) to `controlling use patents,' or patents that claim an approved use of a drug.").
In Warner-Lambert, Apotex — a generic manufacturer — filed an ANDA seeking approval to market a generic formulation of the drug gabapentin at the expiration of Warner-Lambert's epilepsy method patent. 316 F.3d at 1352. Warner-Lambert — which marketed gabapentin under the trade name "Neurontin" — also held rights to a second method-of-use patent for gabapentin (the "neurodegenerative method patent"), which covered the use of gabapentin to treat certain neurodegenerative diseases. Id. at 1351-52. Apotex's ANDA sought approval to market gabapentin for "the same indication for which Warner-Lambert's Neurontin . . . was approved, i.e., for `adjunctive therapy in the treatment of partial seizures with and without secondary generalization in adults with epilepsy.'" Id. at 1352.
In connection with its ANDA, Apotex filed a paragraph IV certification, which represented that its generic product would not infringe Warner Lambert's neurodegenerative method-of-use patent, because Apotex was not seeking approval to use gabapentin for the treatment of neurodegenerative diseases, but only for the treatment of epilepsy. Id. at 1353. Warner-Lambert nonetheless sued Apotex for patent infringement, contending that Apotex's ANDA infringed on Warner-Lambert's neurodegenerative method patent under § 271(e)(2) and that Apotex would induce infringement under § 271(b). In the subsequent litigation, the parties did not dispute that the FDA had approved gabapentin only for use in treating epilepsy, and had not approved it for use in treating neurodegenerative diseases, the method-of-use claimed in Warner-Lambert's patent. Id. at 1362
Warner-Lambert contended that under § 271(e)(2), "a patent claiming a use of a drug is infringed by the filing of an ANDA irrespective of whether approval is sought to market the drug for the patented use." Id. at 1355. This argument was soundly rejected:
Warner-Lambert's proposed interpretation is inconsistent with both of the stated purposes of the Hatch-Waxman Act, and would confer substantial additional rights on pioneer drug patent owners that Congress clearly did not intend to confer. If Warner-Lambert's interpretation were correct, for example, an NDA holder would be able to maintain its exclusivity merely by regularly filing a new patent application claiming a narrow method of use not covered by its NDA. It would then be able to use section 271(e)(2)(A) as a sword against any competitor's ANDA seeking approval to market an off-patent drug for an approved use not covered by the patent. Generic manufacturers would effectively be precluded altogether from entering the market.
Id. at 1359.
Warner-Lambert has consistently been cited for the proposition that an infringement claim against an ANDA filer cannot be premised on a method-of-use patent where that use is not FDA-approved. See, e.g., Allergan, 324 F. Supp. at 1334 ("UnderWarner-Lambert, Allergan is precluded from suing [generic manufacturers] under section 271(e)(2) for inducing infringement of the `415 and `741 patents, because [the generic manufacturers] are not seeking FDA approval for the uses claimed in the patents and because the uses claimed in the patents are not FDA-approved."); Takeda Pharm. N. Am., Inc., 2007 U.S. Dist. LEXIS 74860, at *13 ("[T]he holding of Warner-Lambert that `the request to make and sell a drug labeled with a permissible (non-infringing) use cannot reasonably be interpreted as an act of infringement (induced or otherwise)' is read to apply only when the request refers `to a patent on an unapproved use.'" (quoting Warner-Lambert, 316 F.3d at 1364-65)); TorPharm, Inc. v. Thompson, 260 F. Supp. 2d 69, 74 (D.D.C. 2003) ("[U]nderWarner-Lambert, an ANDA applicant who is not seeking approval for the use covered by the patent in question, where that use has not been approved by the FDA, is not subject to suit under § 271(e)(2)(A)." (citing Warner-Lambert, 316 F.3d at 1354-55));Alcon Labs. v. Allergan, Inc., 256 F. Supp. 2d 1080, 1086 (C.D. Cal. 2003) ("`[I]t is not an act of infringement to submit an ANDA for approval to market a drug for a use when neither the drug nor that use is covered by an existing patent, and the patent at issue is for a use not approved under the NDA.'" (quoting Warner-Lambert, 316 F.3d at 1354)); ICN Pharms. v. Geneva Pharms., 272 F. Supp. 2d 1028, 1037 (C.D. Cal. 2003) ("Method of use infringement actions under Section 271(e)(2) are limited to those involving `controlling use patents,' i.e., patents that claim an FDA-approved use of a drug." (citing Warner-Lambert, 316 F.3d at 1362)).
2. Bayer Fails to State a Claim for Patent Infringement Because Yasmin is Only FDA-Approved for Oral Contraception
Under Warner-Lambert, the critical question in resolving the instant motion is whether Yasmin is FDA-approved for the method-of-use claimed in the `652 patent —i.e.,
A method of simultaneously achieving, during pre-menopause or menopause, a contraceptive effect, an anti-androgenic effect, and an anti-aldosterone effect in a female patient in need thereof comprising administering an effective amount of dihydrospirorenone and an effective amount of an estrogenic compound, wherein said effective amount of dihydrospirorenone is effective to simultaneously achieve a gestagenic effect, anti-androgenic effect, and an anti-aldosterone effect in said female patient.
(Cmplt., Ex. 1 (`652 Patent, Claim 11))
As an initial matter, Bayer claims that when Defendants filed paragraph IV certifications in connection with their ANDA filings, "they certified that they sought approval for the `652 patented use." (Bayer Br. 7) Defendants contend, however, that they "propose to market their generic versions of Yasmin exclusively for the drug's approved, and unpatented, indication of contraception." (Def. Br. 2)
Bayer argues that Defendants' filing of Paragraph IV certifications — rather than section viii statements — constitutes an admission that the FDA has approved the `652 patent method-of-use. (Bayer Br. 1, 2) Bayer cites no authority for the proposition that this Court should base its determination concerning the scope of FDA approval on the ANDA filings of a generic competitor.
The issue of whether Defendants should have filed section viii statements rather than Paragraph IV certifications is for the FDA. If Bayer is correct, then presumably the FDA will reject the ANDA applications. That issue, however, has little bearing on the question this Court must resolve: whether the FDA has approved the method-of-use set forth in the `652 patent.
Nothing in the proposed labels submitted in connection with Defendants' ANDA filings indicates that they seek FDA approval to market their generic drugs for the '652 patented use. (See Defs. Ex. E, F). To the contrary, Defendants' proposed labeling addresses only an indication for oral contraception. (Id.; Defs. Br. 13) This is hardly surprising, because Defendants could not obtain FDA approval to market generic versions of Yasmin for anything other than its FDA-approved use, which Defendants contend is limited to oral contraception. See Warner-Lambert, 316 F.3d at 1356 ("The FDA does not grant across-the-board approval to market a drug. Rather, it grants approval to make, use, and sell a drug for a specific purpose for which that drug has been demonstrated to be safe and efficacious. . . . That is . . . theonly use for which an ANDA applicant can seek approval." (emphasis in original); id. at 1352 ("As mandated by 21 U.S.C. § 355(j)(2)(A)(i), Apotex sought approval to market gabapentin only for the same indication for which Warner-Lambert's Neurontin was approved. . . .").
As to the scope of Yasmin's FDA-approved use, Bayer argues that "[t]he FDA has interpreted the relevant Hatch-Waxman statutes to encompass `uses' broader than just an indication. In both its formal regulations and practice the FDA has acknowledged that FDA-approved `uses' can be in portions of the labeling other than the Indications section." (Bayer Br. 13) Bayer's argument that the FDA has approved the `652 patent's claim of simultaneous gestagenic, anti-androgenic, and anti-aldosterone effect is founded on the following excerpt from the "Clinical Pharmacology" section of the Yasmin label:
Drospirenone is a spironolactone analogue with antimineralocorticoid activity. Preclinical studies in animals and
in vitro have shown that drospirenone has no androgenic, estrogenic, glucocorticoid, and
antiglucocorticoid activity. Preclinical studies in animals have also shown that drospirenone has antiandrogenic activity.
(Defs. Ex. C (Yasmin Label); Bayer Br. 18) Bayer's argument that these label references to animal and in vitro studies constitute FDA approval for the use of Yasmin for its anti-androgenic and anti-aldosterone effects — i.e., that the FDA has found use of Yasmin safe and efficacious to achieve these effects — is frivolous.
As noted above, the "Indications and Usage" section of Yasmin's FDA-approved label states that "YASMIN is indicated for the prevention of pregnancy in women who elect to use an oral contraceptive" and mentions no other indication or use. (Def. Ex. C (Yasmin Label)) The FDA letter approving Bayer's NDA for Yasmin also makes clear that Yasmin has been found safe and effective for oral contraception, and not for other purposes:
This new drug application provides for the use of Yasmin ® Tablets (drospirenone 3 mg/ethinyl estradiol 0.030 mg)
for oral contraception. We have completed the review of this application, as amended, . . . and have concluded that adequate information has been presented to demonstrate that the drug product is safe and effective for use as recommended in the agreed upon enclosed labeling text.
(Def. Ex. B (FDA Approval Ltr.) (emphasis added))
The FDA approves the marketing of prescription drugs for specific purposes that have been proven safe and effective through highly rigorous clinical trials. As noted inWarner-Lambert, "[t]he FDA does not grant across-the-board approval to market a drug. Rather, it grants approval to make, use, and sell a drug for a specific purpose for which that drug has been demonstrated to be safe and efficacious."Warner-Lambert, 316 F.3d at 1356; see also ICN Pharms. v. Geneva Pharms. Tech. Corp., 272 F. Supp. 2d 1028, 1034 (C.D. Cal. 2003) ("In order to market a drug for a particular use, a drug manufacturer must obtain FDA approval through the submission of a new drug application (`NDA') that includes the results of extensive testing, safety information, efficacy information, and composition data.").
The purpose of the FDA-approved label — as to indications and usage — is to clearly communicate what uses have been proven safe and effective, and FDA regulations explicitly provide that other uses and indications not listed in the "Indications and Usage" section of the label may not be implied based on other sections of the label, such as the Clinical Pharmacology section:
[f]or drug products other than biological products, all indications listed in [the "Indications and Usage"] section must be supported by substantial evidence of effectiveness based on adequate and well-controlled studies as defined in § 314.26(b) of this chapter unless the requirement is waived under § 201.58 or § 314.126(c) of this chapter.
Indications or uses must not be implied or suggested in other sections of the labeling if not included in this section.
21 C.F.R. § 201.57(c)(2)(iv) (emphasis added).
Bayer argues that this labeling regulation was not in effect when the FDA approved Yasmin. While the FDA approval letter for Yasmin submitted by the parties is undated, (see Def. Ex. B (FDA Approval Ltr.)), it appears that Yasmin was approved on May 11, 2001. (See Def. Req. for Judicial Notice dated Nov. 16, 2009) While it is true that drug products approved prior to June 30, 2001, are subject to the labeling requirements set forth in 21 C.F.R. § 201.80 rather than the provision cited above, (see 21 C.F.R. § 201.56(b)(2)), Section 201.80 contains the same language as 21 C.F.R. § 201.57(c)(2)(iv): "Indications or uses must not be implied or suggested in other sections of labeling if not included in this section." Compare 21 C.F.R. § 201.80(c)(2)(i) with 21 C.F.R. § 201.57(c)(2)(iv).
Bayer also argues that because the `652 patent is listed in the Orange Book — reflecting the fact that Bayer, in connection with its NDA for Yasmin, notified the FDA that the `652 patent claims the drug for which it sought approval — the FDA has approved the uses claimed in the `652 patent. (Bayer Br. 14) A number of courts have recognized, however, that the Orange Book and the patents listed therein do not reliably indicate what uses of a drug are FDA-approved, in part because the FDA takes the NDA-holders at their word as to which patents claim FDA-approved uses. See Am. Bioscience, Inc. v. Thompson, 269 F.3d 1077, 1080 (D.C. Cir. 2001) ("The FDA, pursuant to longstanding practice and its own regulations, and based on its acknowledged lack of expertise and resources, has refused to become involved in patent listing disputes, accepting at face value the accuracy of NDA holders' patent declarations and following their listing instructions."); Organon Inc. v. Teva Pharms., Inc.. 244 F. Supp. 2d 370, 374 n. 6 (D.N.J. 2002) ("Generic manufacturers determine whether there is a patent that may be applicable to their ANDAs by reference to the `Orange Book,' in which patent-owners list their patents in order to provide such notice. Despite that FDA regulations require that `for patents that claim a method of use the applicant shall submit information [to the Orange Book] only on those patents that claim indications or other conditions of use of a pending or approved [NDA],' 21 C.F.R. § 314.53(b), it is common for pioneers to list any and every patent they can obtain in the Orange Book so as to force generic manufacturers to file paragraph IV certifications. The FDA does not appear to have policed this practice."). Accordingly, listings in the Orange Book are not a reliable indicator of what uses of a drug have received FDA approval.
Alcon Labs. v. Allergan, 256 F. Supp. 2d 1080 (C.D. Cal. 2003), supports this Court's determination that the FDA-approved use of a drug is governed by the "Indications and Usage" section of its label, rather than listings in the Orange Book. In that case, Allergan — the pioneer company — had obtained FDA approval to market the drug Alphagan as a treatment for glaucoma, and specifically to reduce intraocular pressure ("IOP"). Allergan scientists later discovered, however, that the drug also had neuroprotective properties such that applying it to nerve cells made them less susceptible to injury and degeneration. The drug itself was not protected by patent, but Allergan applied for and was granted patents relating to the drug's newly-discovered neuroprotective use. Allergan listed these patents in the Orange Book and gave notice that these new patents were related to the FDA-approved use of Alphagen for IOP. Generic companies then filed ANDAs with the FDA seeking to market generic versions of the drug, with the same FDA labeling requirements approved for Alphagan. Allergan sued the generic companies alleging patent infringement. Id. at 1082-1084.
Applying Warner-Lambert, the Alcon Labs. court stated that "Allergan's claim . . . cannot be predicated on a non-controlling use patent." Alcon Labs., 256 F. Supp. 2d at 1086. In an attempt to circumvent the Warner-Lambert holding, Allergan argued that "the use claimed under the ANDA is covered by the . . . Patent-in-suit." Id. Allergan claimed that "there is a distinction between the label for Alphagan®, on the one hand, and the approved use for [the drug], on the other." Id. The Court, however, flatly rejected this argument:
Although Allergan indicates that the Alphagan® label states that the product is "indicated for lower intraocular pressure in patients with open-angle glaucoma or ocular hypertension," Allergan contends that the use of [the drug] for neuroprotection
to treat open-angle glaucoma is also an approved method of use. The Court finds no support for this argument, either in the product label for Alphagan® or in the FDA approval letter for Alphagan®.
Id. Alcon Labs. is on all fours with the instant action. Like Bayer, Allergan attempted to avoid the holding of
Warner-Lambert by arguing that its drug was FDA-approved for uses beyond the "Indications and Usage" section of the Alphagan label.
The court examined the FDA-approved label for Alphagen and the FDA letter approving Allergan's NDA for Alphagen, found no indication for the use contemplated by the patent-in-suit, and rejected Allergan's argument. This Court has conducted the same analysis and reaches the same conclusion.
Defendants are entitled to judgment on the
pleadings concerning Bayer's patent infringement claims asserted under
35 U.S.C. § 271(e)(2)(A).
In support of its argument that the scope of FDA approval for Yasmin presents at least a question of fact, Bayer has submitted declarations from an obstetrician and a former FDA official who was involved in the approval process for Yasmin. This Court is convinced based upon the Complaint and its exhibit, the documents incorporated and referenced therein, and documents integral to the Complaint, however, that the instant action must be dismissed. The Court is not required to consider the additional exhibits submitted by Bayer. Miller v. Potter, No 07-CV-1767 (JFB) (ETB), 2007 U.S. Dist. LEXIS 95688, at *11 n. 5 (E.D.N.Y. Nov. 29, 2007) ("[A]lthough the Court could convert the motion to dismiss to a motion for summary judgment and consider the Sturm Declaration, the Court need not do so."); Gomez v. Warden of Otisville Corr. Facility, No. 99 Civ. 9954, 2000 U.S. Dist. LEXIS 14508, at *2 n. 1 (S.D.N.Y. Sept. 29, 2000) ("The parties have submitted affidavits and documentary exhibits in support of their submissions. The Court declines to consider matters outside of those permissible under Rule 12(b)(6), and chooses not to convert the motion to dismiss into one for summary judgment pursuant to Rule 56. . . . [T]his motion can be decided solely on the allegations in the Complaint, which make it clear that the Complaint must be dismissed." (citing Int'l Audiotext Network v. Am. Tel. Co., 62 F.3d 69, 72 (2d Cir. 1995) (per curiam);Crawford v. New York City Bd. of Educ., No. 99 Civ. 925, 1999 WL 1072495, at *1 (S.D.N.Y. Nov. 29, 1999))).
Even if the Court were to consider Bayer's additional exhibits, however, they in no way refute the overwhelming evidence that Yasmin is FDA-approved only for oral contraception. For example, the obstetrician's alleged belief that claim 11 of the `652 patent reflects an "on-label" use for Yasmin (see Bayer Ex. 3 (Shulman Decl.) at ¶¶ 19-24) — because the anti-androgenic and anti-aldosterone effects of the drug are mentioned in the Clinical Pharmacology section of the label — demonstrates only that the doctor misapprehends the nature of FDA approval as it relates to indication and usage.
Similarly, the declaration of a former FDA official involved in the approval of Bayer's NDA for Yasmin (see Bayer Ex. 7 (Allen Decl.)) — since retained as an expert by Bayer — is insufficient to raise a factual issue as to whether Yasmin is FDA-approved for a use other than oral contraception. Dr. Allen's assertion that an FDA-approved use can be discerned from a reference — in a label's Clinical Pharmacology section — to side effects noted in pre-clinical animal and in vitro studies flatly contradicts the FDA regulation and case law discussed above, and is not credible.
Similarly, the declarations establishing that FDA's Division of Drug Marketing, Advertising, and Communications (DDMAC) has not objected to Bayer's promotional materials for Yasmin (Bayer Exs. 9, 10) — which make reference to Yasmin's alleged anti-androgenic and anti-aldosterone effects — are not sufficient to create an issue of fact as to the scope of Yasmin's FDA-approved use. Bayer cites no law for the proposition that the FDA's failure to object to marketing materials can broaden the scope of an FDA approved use.
B. Section 271(b) Claims
The Complaint also asserts induced infringement claims against Defendants under 35 U.S.C. § 271(b) (see Cmplt., ¶¶ 45-46, 48-49), which states that "whoever actively induces infringement of a patent shall be liable as an infringer." 35 U.S.C. § 271(b). Nothing in the record suggests that Defendants intend to promote their generic versions of Yasmin based on the anti-androgenic or anti-aldosterone properties claimed by the `652 patent, however. In their proposed labels, Defendants seek only an indication for oral contraception. (See Def. Ex. E (Comparison of Yasmin Label with Watson Proposed Label), Ex. F (Comparison of Yasmin Label with Sandoz Proposed Label))
Bayer argues that Defendants' proposed labels for their generic versions of Yasmin will induce infringement, because they "do[] not restrict the intended use of [their] product[s] to the creation of a gestagenic effect in patients." (Cmplt. ¶¶ 26, 40) Bayer also alleges that because Defendants' proposed labels disclose drospirenone's pharmacological profile and provide information "regarding the anti-aldosterone and anti-androgenic properties of drospirenone," Defendants "will be marketing [their] ANDA product[s] with specific intent, and/or with the desire to actively induce, aid, and abet infringement of the `652 patent." (Cmplt. ¶¶ 27-28, 41-42) The Warner-Lambert court considered and rejected this precise argument:
[T]he ANDA must be judged on its face for what an accused infringer seeks the FDA's approval to do. . . . The statute explicitly defines the act of infringement as the filing of the ANDA. The infringement case is therefore limited to an analysis of whether what the generic drug maker is requesting authorization for in the ANDA would be an act of infringement if performed.
Here, the request to make and sell a drug labeled with a permissible (non-infringing) use cannot reasonably be interpreted as an act of infringement (induced or otherwise) with respect to a patent on an unapproved use, as the ANDA does not induce anyone to perform the unapproved acts required to infringe.
Warner-Lambert,
316 F.3d at 1364-65 (emphasis added). Here, as in
Warner-Lambert, both Defendants seek FDA approval solely for Yasmin's FDA-approved use of oral contraception. Accordingly, Defendants' ANDAs do not provide a basis for Bayer's induced infringement claims.
The Complaint's remaining allegations are likewise insufficient to state a claim for induced infringement. Bayer alleges, for example, that Defendants are "aware . . . of the widespread use of Yasmin . . . to produce simultaneously a gestagenic, anti-androgenic, and anti-aldosterone effect in premenopausal or menopausal female patients" and that "[t]his use . . . would be readily apparent to [Defendants'] customers. . . ." (Cmplt. ¶¶ 25, 39) Bayer further alleges that Defendants are aware that "a significant proportion of . . . [Yasmin] prescriptions are written with the intent of producing three pharmacological effects — gestagenic, anti-aldosterone, and anti-androgenic," and that Defendants will thus be marketing their ANDA products "with specific intent, and/or with the desire to actively induce, aid, and abet infringement of the `652 patent." (Cmplt. ¶¶ 26, 40)
As the Warner-Lambert court explained, such allegations are insufficient to support an induced infringement claim. In that case, Warner-Lambert contended that the generic manufacturer "had to have `known' that physicians were prescribing gabapentin for treatment of neurodegeneration" — the use claimed by the patent-in-suit. The Federal Circuit rejected this allegation as a basis for an induced infringement claim, however:
[M]ere knowledge of possible infringement by others does not amount to inducement;
specific intent and action to induce infringement must be proven. [
Manville Sales Corp. v. Paramount Sys., Inc.,
917 F.2d 544, 554 (Fed Cir. 1990)] Thus, if a physician, without inducement by [the generic manufacturer] prescribes a use of gabapentin in an infringing manner, [the generic manufacturer's] knowledge is legally irrelevant.
Warner-Lambert,
316 F.3d at 1364.
Bayer's claims for induced infringement pursuant to § 271(b) must be dismissed.
Because Bayer cannot state a claim for patent infringement or induced patent infringement based on its `652 patent, amending the Complaint is futile and leave to amend will not be granted.See Salahuddin v. Cuomo, 861 F.2d 40, 42 (2d Cir. 1988) (noting that a court may dismiss a claim without leave to amend when "the substance of the claim pleaded is frivolous on its face" (citingMoorish Sci. Temple v. Smith, 693 F.2d 987, 990 (2d Cir. 1982)). An action is considered frivolous when, inter alia, "the claim is `based on an indisputably meritless legal theory.'" Nance v. Kelly, 912 F.2d 605, 606 (2d Cir. 1990) (per curiam) (quotingNeitzke v. Williams, 490 U.S. 319, 327 (1989)). Such is the case here.
CONCLUSION
For the reasons stated above, Defendants' motion for judgment on the pleadings is GRANTED. Bayer's patent infringement claims are dismissed with prejudice. The Clerk of the Court is directed to terminate Defendants' motion. (Docket No. 78)
Dated: New York, New York
SO ORDERED.