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High court ruling could make it harder to reverse patent rulings

Sheridan Ross shareholder Robert Brunelli was quoted October 10, 2014 in a Law360 article discussing the potential impacts of the Supreme Court case Teva Pharmaceuticals USA Inc. et al. v. Sandoz Inc. et al.  The outcome of which – oral arguments were heard on Wednesday, October 15 – could reshape patent litigation by requiring the Federal Circuit to give deference to district court claim construction rulings.

Currently, the Federal Circuit reviews all claim construction rulings, leading to many patent decisions being reversed. The Supreme Court agreed to hear the case three weeks after the Federal Circuit considered the same issue en banc and decided in February to reaffirm its long-standing rule that claim construction must always be reviewed de novo.

One potential outcome of the case, according to a number of attorneys, is a significant change to the de novo review. The Federal Rules of Civil Procedure state that when a district court makes factual findings, they cannot be set aside on appeal unless they are clearly erroneous. However, the Federal Circuit has held since a 1998 en banc decision called Cybor Corp. v. FAS Technologies Inc. that claim construction is question of law that must be reviewed de novo, even when it involves fact-based issues.

Brunelli commenting on the potential repercussions of eliminating de novo review said, “Ending de novo review could also make patent litigation more expensive. Many judges now make claim construction rulings early in a case, but the parties would likely present more evidence under a deferential standard, so claim construction would take place later in litigation.

“The cost of the case will actually go up,” he said.

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