U.S. District Judge Brian R. Martinotti/courtesy photo

Allergan Inc. might have struck out three times in previous efforts to enforce Latisse eyelash enhancer patents. But that doesn't mean its fourth try, or all of them taken together, represent an illegal scheme to monopolize the $70 million-a-year market, a federal judge decided Monday.

U.S. District Judge Brian Martinotti ruled that, because Akorn Inc. and other generic challengers had failed in part to get two of the previous cases declared "exceptional" and recover their fees, those cases could not as a matter of law be considered "sham" proceedings. The sham designation is a predicate for an antitrust finding in the litigation context.

"As the district court [in North Carolina] has already determined—by a preponderance of the evidence—that the litigations are not exceptional, they cannot be said to be objectively baseless," Martinotti wrote in a 21-page order.

Duke University v. Akorn is a win for Fish & Richardson; Weil, Gotshal & Manges: and Walsh Pizzi O'Reilly Falanga, which represent Allergan and Duke University. Duke developed the patents and licensed them to Allergan.

The litigation dates back more than five years. U.S. District Judge Catherine Eagles of North Carolina had found Duke's 7,388,029 and 7,351,404 patents, on methods and compositions for strengthening the growth of hair and eyelashes, valid and infringed. But the Federal Circuit reversed in a 2-1 ruling, holding the patents invalid as obvious.

While that appeal was pending, Allergan and Duke asserted three continuation patents against Akorn in North Carolina. Eagles ruled that all three claim "substantially the same subject matter" as the '404 and, in light of the Federal Circuit ruling, they were therefore invalid, too.

That didn't stop Allergan from maintaining yet another eyelash patent case against Akorn before Eagles. Again, she ruled that Duke and Allergan were collaterally estopped by the Federal Circuit's 2014 decision.

Now, Duke and Allergan are back a fourth time, this time in New Jersey with a patent obtained in 2017, and Akorn is firing back with antitrust allegations.

The company and its Schiff Hardin and Schnader Harrison Segal & Lewis attorneys have counterclaimed for monopolization and attempted monopolization of the market for bimatoprost, the active ingredient in the Latisse ophthalmic solution. They allege that Allergan and its "co-conspirator" Duke have brought a series of sham lawsuits with no other goal than improperly delaying entry of generics into the market.

"Of the seven patents asserted in Latisse I-III, Plaintiffs failed to establish infringement of a single valid patent claim," Akorn complains.

Antitrust findings are hard to get in patent litigation, because the Supreme Court's Noerr-Pennington doctrine shields litigation conduct, so long as the litigation isn't a mere "sham" proceeding. Just last week, the Federal Circuit sidestepped antitrust counterclaims brought by Capital One Financial Corp. against Intellectual Ventures. But in dismissing Akorn's antitrust claims Monday, Martinotti set down what seem like even more strict new rules.

First, even if Duke's latest patent does contain "substantially similar claims" to its previously invalidated patents, the U.S. Patent and Trademark Office issued it after the Federal Circuit's ruling, and it is therefore presumed valid. "The assertion of claims in a patent whose validity has not yet been litigated cannot be said to be 'objectively baseless in the sense that no reasonable litigant could realistically expect success on the merits,'" Martinotti wrote, citing the U.S. Supreme Court's Professional Real Estate Investors case on baselessness.

Moreover, Akorn and a co-defendant had moved for attorney fees in two of the North Carolina cases and each time was turned down. As Duke and Allergan put it in their motion to dismiss, the antitrust claims are "a belated attempt to re-litigate unsuccessful motions for attorneys' fees under U.S. patent law that Akorn raised or could have raised long ago."

Martinotti held Monday that because the patent infringement cases weren't weak enough to justify an "exceptional case" finding under Section 285 of the Patent Act, they cannot as a matter of law be "sham" litigation proceedings under antitrust case law. He agreed with Duke and Allergan that "the 'exceptional case' standard in Section 285 is lower than the sham litigation standard that applies here," and, therefore, the cases cannot be considered objectively baseless.

Duke and Allergan's victorious team included Fish & Richardson partners Jonathan Singer and Elizabeth Flanagan; Weil Gotshal partner Eric Hochstadt; and Walsh Pizzi partners Liza Walsh and Katelyn O'Reilly.

Akorn and subsidiary Hi-Tech Pharmacal were represented by Schiff Hardin partners Sailesh Patel and Joel Wallace and associate Helen Ji; and by Schnader Harrison partner Lisa Rodriguez.