Johnson and Johnson 2010 Annual Report Download - page 67

NOTES TO CONSOLIDATED FINANCIAL ST A TEMENTS65
Wright and Falotico patents, the District Court in Delaware found
the Wright/Falotico patent invalid for lack of written description
and/or lack of enablement. Cordis has appealed this ruling.
In January 2011, a jury in the Eastern District of Texas returned
a verdict finding that Cordis’ sales of its CYPHER® stent willfully
infringed a patent issued to plaintiff, Bruce Saffran: Saffran v. Cordis
(E.D. Tx.). The jury awarded plaintiff $482 million. Cordis has
alleged that plaintiff’s patent is invalid or unenforceable under the
doctrine of inequitable conduct. A bench trial on this issue is
expected to take place in March 2011. If unsuccessful on this
defense, the Company will seek to overturn the verdict through
post-trial motions, and on appeal if necessary. Since the Company
believes that the potential for an unfavorable outcome is not proba-
ble, it has not established a reserve with respect to the case.
In October 2004, Tyco Healthcare Group, LP, (Tyco) and U.S.
Surgical Corporation sued Ethicon Endo-Surgery, Inc. (EES) alleging
that several features of EES’s harmonic scalpel infringed four Tyco
patents. In October 2007, the court granted in part and denied in
part cross-motions for summary judgment. As a result of the opin-
ion, a number of claims have been found invalid and a number have
been found infringed. No claim has been found valid and infringed.
Trial commenced in December 2007, and the court dismissed the
case without prejudice on grounds that Tyco did not own the
patents in suit. The dismissal without prejudice was affirmed on
appeal. In January 2010, Tyco filed another complaint in the District
of Connecticut asserting three of the four patents from the previous
suit and adding new products. This case is scheduled to be tried in
October 2011.
In May 2008, Centocor, Inc. (now Centocor Ortho Biotech Inc.
(COBI)) filed a lawsuit against Genentech, Inc. (Genentech) in
U.S. District Court for the Central District of California seeking to
invalidate the Cabilly II patent. Prior to filing suit, COBI had a
sublicense under this patent from Celltech (who was licensed
by Genentech) for REMICADE®and had been paying royalties
to Celltech. COBI has terminated that sublicense and stopped
paying royalties. Genentech has filed a counterclaim alleging
that REMICADE®infringes its Cabilly II patents. Genentech has
dropped all its other claims that the manufacture of REMICADE®,
STELARA®, SIMPONI®and ReoPro® also infringes one of its other
patents relating to the purification of antibodies made through
recombinant DNA techniques. The court conducted a hearing on
Summary Judgment Motions in August 2010. Shortly thereafter
the parties settled this case with COBI receiving license under the
Cabilly II patent.
In January 2011, Genentech initiated an arbitration against
Celltech seeking damages for allegedly cooperating with COBI
to improperly terminate a prior agreement in which COBI was
sublicensed under the Cabilly patents. COBI has an indemnity
agreement with Celltech, and Celltech has asserted that COBI is
liable for any damages Celltech may be required to pay Genentech,
in that arbitration.
In April 2009, a bench trial was held before the Federal District
Court for the Middle District of Florida on the liability phase of CIBA
VISION Corporation’s (CIBA) patent infringement lawsuit alleging
that Johnson & Johnson Vision Care, Inc.’s (JJVC) ACUVUE®
OASYS™lenses infringe three of their Nicholson patents. In August
2009, the District Court found two of these patents valid and
infringed and entered judgment against JJVC. JJVC appealed that
judgment to the Court of Appeals for the Federal Circuit. On April
27, 2010, the District Court denied CIBA’s motion to permanently
enjoin the infringing lenses. CIBA appealed this ruling and its appeal
was consolidated with JJVC’s appeal on the merits. CIBA brought
suit against JJVC under its counterparts to the Nicholson patents in
various European countries. In the Netherlands and France the
patents were found valid and infringed and JJVC was enjoined from
selling OASYS™. Both those decisions were appealed. In France the
appeal was denied. In the Netherlands the appeal was pending.
CIBA’s patents were found to be invalid in Germany, the UK and
Austria and CIBA appealed those decisions. In January 2011 the
parties settled all pending lawsuits and appeals in the contact lens
field worldwide and entered in cross-licenses of various patents
pertinent to the contact lens field including the Nicholson patents.
The injunctions in France and the Netherlands have been lifted.
In May 2009, Abbott Biotechnology Ltd. (Abbott) filed a
patent infringement lawsuit against Centocor (now COBI) in the
United States District Court for the District of Massachusetts. The
suit alleges that Centocor’s SIMPONI®product, a human anti-TNF
alpha antibody, infringes Abbott’s ’394 patent (the Salfeld patent).
The case was stayed pending the resolution of an arbitration filed by
Centocor directed to its claim that it is licensed under the ’394
patent. In June 2010, the Arbitrator ruled that Centocor did not have
a license to the patents-in-suit. The matter will proceed before the
District Court of Massachusetts on the issues of infringement and
validity of the Abbott patents.
In August 2009, Abbott GmbH & Co. (Abbott GmbH) and
Abbott Bioresearch Center filed a patent infringement lawsuit
against Centocor (now COBI) in the United States District Court
for the District of Massachusetts. The suit alleges that COBI’s
STELARA®product infringes two U.S. patents assigned to Abbott
GmbH. In August 2009, COBI filed a complaint for a declaratory
judgment of non-infringement and invalidity of the Abbott GmbH
patents in the United States District Court for the District of
Columbia. On the same date, also in the United States District Court
for the District of Columbia, COBI filed a Complaint for Review of a
Patent Interference Decision granting priority of invention on one
of the two asserted patents to Abbott GmbH. In August 2009,
Abbott GmbH and Abbott Laboratories Limited brought a patent
infringement suit in The Federal Court of Canada alleging that
STELARA®infringes Abbott GmbH’s Canadian patent. The
Canadian case is scheduled to be tried in October 2012. The cases
filed by COBI in the District of Columbia have been transferred to
the District of Massachusetts. Discovery in this case is ongoing.
In August 2009, Bayer HealthCare LLC (Bayer) filed suit
against COBI in Massachusetts District Court alleging infringement
by COBI’s SIMPONI®product of its patent relating to human anti-
TNF antibodies. On January 28, 2011, the court issued judgment dis-
missing Bayer’s infringement claims. Bayer may appeal this ruling.
In November 2009, Bayer also filed suit under its European counter-
part to these patents in Germany and the Netherlands. The court
in the Netherlands held the Dutch patent invalid in a parallel case
Bayer brought against Abbott. The Dutch court subsequently
entered judgment in favor of the European Centocor affiliate and
Bayer appealed that judgment in the Netherlands. The infringement
trial in Germany is scheduled to begin in August of 2011.