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AIDS Healthcare Foundation, Inc. v. Gilead Sciences, Inc

Desire to “Clear Out” Allegedly Invalid Patents Insufficient to Establish DJ Jurisdiction

AIDS Healthcare Foundation, Inc. v. Gilead Sciences, Inc., __ F.3d __, 2018 WL 2168658 (Fed. Cir. May 11, 2018) (NEWMAN, Dyk, Stoll) (N.D. Cal.: Alsup) (2 of 5 stars)

Fed Cir affirms dismissal of declaratory judgment action. Healthcare’s complaint sought to demonstrate the invalidity of five patents held by the defendants relating to the antiviral agent tenofovir alafenamide fumarate (“TAF”), used in the treatment of AIDS. Healthcare failed to show a case of controversy existing at the time of its complaint. Healthcare’s desire to “clear out” allegedly-invalid patents before the end of defendants’ five-year New Chemical Entity exclusivity was insufficient, without more, to establish a case of controversy of sufficient immediacy to merit declaratory judgment. “In this case, where there is no present infringement, no threat of or possibility of infringement litigation, and no meaningful preparation to infringe, the ‘immediacy and reality’ criteria [of MedImmune, 549 U.S. 118 (2007),] are not met.” Op. at 6. The opinion also rejects Healthcare’s argument that it is currently inducing infringement by attempting to line up manufacturers for generic TAF products at the end of exclusivity. “Liability for induced infringement requires that some other entity is directly infringing the patent.” Id. at 8. Healthcare’s interest in buying unlicensed TAF products is not an adverse legal interest for purposes of declaratory judgment. And Gilead’s failure to respond to Healthcare’s written request for a covenant not to sue is insufficient to create DJ jurisdiction. The opinion also rejects Healthcare’s appeal to policy considerations as justifying extension of jurisdiction.

KEYWORDS: DECLARATORY JUDGMENT; JURISDICTION (NO); MOTION TO DISMISS; CASE OR CONTROVERSY