AbbVie v. MedImmune was decided on February 5, 2018 on appeal from the Eastern District of Virginia. A 1995 agreement between the parties licensed AbbVie to practice the ‘516 patent, among others. AbbVie did not practice the patent at the time. Under the agreement, AbbVie was to pay royalties on the sales of certain antibodies “until the last to expire of [certain] Patents or the expiry of fifteen years from the date of First Commercial Sale of a Product by [AbbVie’s predecessor] . . . (whichever is later).” The last of those patents to expire was the ‘516 patent, with an expiration date of June 19, 2018. AbbVie filed a declaratory action against MedImmunue, seeking to invalidate the ‘516 patent. The district court dismissed without prejudice on two grounds, first holding that AbbVie lacked standing because it did not practice the patent, and alternatively holding that it would not exercise jurisdiction because the agreement was governed by British law and would implicate rights of the British government. AbbVie appealed.
The Federal Circuit affirmed the district court’s dismissal of the action without prejudice.
The district court erred in holding that it lacked declaratory-judgment jurisdiction on the basis that there is no controversy as to infringement of the ‘516 patent. Generally, “courts examine declaratory actions, at least in part, by looking to the mirror image suit the declaratory defendant might bring if and when it seeks coercive relief.” The district court erred by characterizing AbbVie’s declaratory claim as the mirror image of an infringement suit. AbbVie’s claim did not rest on the possibility of infringement, but rather concerned the parties’ contractual obligations under the 1995 agreement. “Those contractual obligations turn[ed] on the expiration and, perhaps, the validity of the ‘516 patent,” and not “on whether AbbVie engaged in infringement.” Such contractual disputes, if properly presented, could confer declaratory-judgment jurisdiction.
A declaratory judgment action was nonetheless improper. “AbbVie’s problem [was] that it did not seek a declaration of its contractual obligations. Rather, AbbVie’s complaint only sought a declaration of invalidity with respect to the ‘516 patent.” Such a declaration would not actually resolve the parties’ contractual dispute. “[P]arties may not seek by declaratory judgment to litigate a single issue in a dispute that must await another lawsuit for complete resolution.” The 1995 agreement was governed by British law and pegged the end of AbbVie’s payments to the expiration of the ‘516 patent. The Federal Circuit reasoned that it was “an open question whether British courts would consider the invalidation of a patent to be tantamount to its expiration for purposes of this agreement.” Without a resolution to this question, the parties’ contractual dispute would persist. AbbVie had no other pending litigation that would conclusively resolve its contractual dispute with MedImmune. “Without taking at least that step, in either the American or British courts, it [could not] establish declaratory-judgment jurisdiction over the question of invalidity.”
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AbbVie Inc. v. MedImmune Ltd., 881 F.3d 1334 (Fed. Cir. 2018)