U.S. Court of Appeals for the Ninth Circuit, Shana Becerra, v. Dr Pepper/Seven Up, Inc., Docket No. 18-16721

California Consumer Fraud

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Labeling

Packaging

Reasonable Consumer Test

Unfair Competition

California Law

The panel affirmed the district court’s dismissal of plaintiff’s third amended complaint alleging that Dr Pepper/Seven Up, Inc. violated various California consumer-fraud laws by branding Diet Dr Pepper using the word “diet.”

The panel held that the allegations in the complaint failed to sufficiently allege that reasonable consumers read the word “diet” in a soft drink’s brand name to promise weight loss, healthy weight management, or other health benefits. The panel held that diet soft drinks are common in the marketplace and the prevalent understanding of the term in that context is that the “diet” version of a soft drink has fewer calories than its “regular” counterpart. Just because some consumers may unreasonably interpret the term differently does not render the use of “diet” in a soda’s brand name false or deceptive. Accordingly, because plaintiff had not sufficiently alleged that Diet Dr Pepper’s labeling was false or misleading, dismissal was proper.

The second amended complaint raised five causes of action: (1) violations of the California False Advertising Law, Cal. Bus. & Prof. Code §§ 17500 et seq.; (2) violations of the California Consumers Legal Remedies Act, Cal. Civ. Code §§ 1750 et seq.; (3) violations of the California Unfair Competition Law, Cal. Bus. & Prof. Code §§ 17200 et seq.; (4) breach of express warranty in violation of Cal. Com. Code § 2313(1); and (5) breach of the implied warranty of merchantability in violation of Cal. Com. Code § 2314.

Becerra’s claims under the California consumer- protection statutes are governed by the “reasonable consumer” test. Williams v. Gerber Prods. Co., 552 F.3d 934, 938 (9th Cir. 2008). Under this standard, Becerra must “show that members of the public are likely to be deceived.” Id.; see also Bank of West v. Superior Court, 833 P.2d 545, 553 (Cal. 1992). This requires more than a mere possibility that Diet Dr Pepper’s label “might conceivably be misunderstood by some few consumers viewing it in an unreasonable manner.” Lavie v. Procter & Gamble Co., 129 Cal. Rptr. 2d 486, 495 (Cal. Ct. App. 2003); see id. at 492 (rejecting a “least sophisticated consumer” standard). Rather, the reasonable consumer standard requires a probability “that a significant portion of the general consuming public or of targeted consumers, acting reasonably in the circumstances, could be misled.” Id.

When considering the term in its proper context, no reasonable consumer would assume that Diet Dr Pepper’s use of the term “diet” promises weight loss or management. In context, the use of “diet” in a soft drink’s brand name is understood as a relative claim about the calorie content of that soft drink compared to the same brand’s “regular” (full- caloric) option. See Geffner, 928 F.3d at 200 (“the ‘diet’ label refers specifically to the drink’s low calorie content; it does not convey a more general weight loss promise” (footnote omitted)). And considering “diet” as a proper noun—as in Diet Dr Pepper—does not further Becerra’s argument. In common usage, consumers know that Diet Dr Pepper is a different product from Dr Pepper—different not only in name, but in packaging and, importantly, taste.

Becerra argues that, regardless of the common understanding of the word, dismissal was still improper because she alleged a plausible misunderstanding of the word. But we have previously affirmed dismissal of claims based on similar unreasonable assumptions. In Ebner, the plaintiff claimed that a net-weight statement on packaging for a lip balm was deceptive because the design of the dispenser left twenty-five percent of the product inaccessible. 838 F.3d at 961. We held that similar dispensers were “commonplace in the market,” such that a reasonable consumer “understands the general mechanics of these dispenser tubes and further understands that some product may be left in the tube” even when pushed all the way up. Id. at 965. “A rational consumer would not simply assume that the tube contains no further product” when he or she could see the remaining product in the tube. Id. at 966. And even if some consumers would make that assumption, the packaging was not deceptive just because some consumers could unreasonably misunderstand the product. Id.

(…) As the Second Circuit pointed out when considering a nearly identical complaint, “the use of physically fit and attractive models using and enjoying advertised products is so ubiquitous that it cannot be reasonably understood to convey any specific meaning at all.” Geffner, 928 F.3d at 200.

Counsel for Defendant-Appellee:

Evan A. Young (argued), Baker Botts L.L.P., Austin, Texas; Van H. Beckwith, Baker Botts L.L.P., Dallas, Texas; Ariel D. House, Baker Botts L.L.P., San Francisco, California; for Defendant-Appellee.

(U.S. Court of Appeals for the Ninth Circuit, December 30, 2019, Shana Becerra, v. Dr Pepper/Seven Up, Inc., Docket No. 18-16721, For Publication)

U.S. Court of Appeals for the Federal Circuit, Thermolife International LLC, Board of Trustees of the Leland Stanford Junior University, v. GNC Corp., Docket No. 2018-1657, 2018-1666

Patent

Infringement

Adequate Pre-Suit Investigation into Infringement

Discovery

Attorney Fees Award

35 U.S.C. § 285

Enforceable Patent Rights to Research Institutions and their Exclusive Licensees

Appeals from the United States District Court for the Southern District of California in Nos. 3:13-cv-00651-JLS- MDD, 3:13-cv-00830-JLS-MDD, 3:13-cv-01015-JLS-MDD, Judge Janis L. Sammartino.

ThermoLife International, LLC exclusively licensed four patents from the Board of Trustees of the Leland Stanford Junior University. It filed infringement suits, asserting selected claims of four patents, against numerous defendants, including Hi-Tech Pharmaceuticals, Inc. and Vital Pharmaceuticals, Inc. After Stanford became a co- plaintiff of ThermoLife’s, a bench trial was held involving Hi-Tech, Vital, and a trio of companies from the GNC family as defendants (all other defendants having settled). The district court held all asserted claims invalid. That ruling ended the cases on the merits and is not at issue here.

Before us is the court’s later grant of Hi-Tech’s and Vital’s motions for attorney’s fees under 35 U.S.C. § 285, which authorizes an award of fees to a prevailing party (like Hi-Tech and Vital) in “exceptional” cases. The district court found the cases exceptional, but not based on an assessment of the validity position taken by plaintiffs ThermoLife and Stanford or how they litigated validity. Rather, the court relied on its conclusion that plaintiffs were unjustified in alleging infringement in the first place, having failed to do an adequate pre-filing investigation.

ThermoLife and Stanford appeal the district court’s award of fees, challenging the determination that these were “exceptional” cases, not the amounts the court awarded after finding the cases exceptional. We recognize that these are unusual cases in that the basis for the fee award had nothing to do with the only issues litigated to reach the judgment on the merits: Infringement had not been adjudicated in reaching the final judgment, and even discovery on infringement had been postponed early in the proceedings so that validity could be litigated first. Nevertheless, we see no abuse of discretion in the district court’s determination of exceptionality based on plaintiffs’ inadequate pre-suit investigation of infringement in these and related cases. We therefore affirm.

Stanford owns U.S. Patent Nos. 5,891,459, 6,117,872, 6,646,006, and 7,452,916, which claim methods and compositions involving the amino acids arginine and lysine, to be ingested to enhance vascular function and physical performance. See, e.g., ’459 patent, Abstract. The ’459 patent, the ’916 patent, and the relevant claims of the ’006 patent share a priority date of June 11, 1993, and expired on June 11, 2013. The ’872 patent has a priority date of June 23, 1998, and expired on June 23, 2018. All asserted claims of the ’459, ’872, and ’916 patents are method claims, whereas all asserted claims of the ’006 patent are composition claims.

(…) Pursuant to applicable local rules for patent cases, ThermoLife notified the defendants of specific infringement contentions shortly after the suits were filed. In its December 12, 2013 amended infringement contentions, ThermoLife identified specific Hi-Tech products and the corresponding allegedly infringed patent claims.

(…) By January 2014, with dozens of cases before it, the district court had set a schedule in which discovery was to begin for claim construction, invalidity, unenforceability, and standing—but not for infringement.

(…) On October 12, 2016, Hi-Tech and Vital (but not the GNC entities) moved for attorney’s fees under 35 U.S.C. § 285. Rhetoric aside, they made two related arguments for exceptionality that are relevant here. Their main argument was that plaintiffs did not conduct an adequate pre-suit investigation into infringement, an investigation that would have revealed that the accused products did not infringe claim 1 of the ’459 patent, the only claim Hi-Tech and Vital specifically discussed.

(…) In February 2018, the district court awarded $903,890.13 to Hi-Tech and $406,131.76 to Vital for attorney’s fees and expenses, including pre- and post- judgment interest.

ThermoLife and Stanford appeal the district court’s exceptional-case determination. We have jurisdiction under 28 U.S.C. § 1295(a)(1).

A court “in exceptional cases may award reasonable attorney fees to the prevailing party.” 35 U.S.C. § 285. An exceptional case is one that, under the totality of the circumstances, “stands out from others with respect to the substantive strength of a party’s litigating position” or “the unreasonable manner in which the case was litigated.” Octane Fitness, LLC v. ICON Health & Fitness, Inc., 572 U.S. 545, 554 (2014).

We conclude that the district court in this case acted within its discretion in determining, on the limited arguments plaintiffs made in response to the fee motions, that plaintiffs did not conduct an adequate pre-suit investigation into infringement by Hi-Tech and Vital. That determination would suffice to support the exceptional-case determination. And we read the district court’s additional discussion of plaintiffs’ filing of numerous suits on the patents at issue here as itself ultimately resting on the same lack of adequate pre-suit investigation, not simply on ThermoLife’s limited product sales, the expiration dates of three of the four patents, the number of suits filed, or the amounts of the settlements. For those reasons, we affirm the exceptional-case determination.

(…) The district court thus properly focused on whether, when plaintiffs sued in 2013, they had done an adequate investigation of whether the accused products were being administered in amounts that would produce the claimed effect. The district court found that one gram was needed for that purpose. That finding had adequate support in the record.

The deposition and trial testimony given by ThermoLife’s validity expert provides such support. In the deposition, the expert described knowledge available before the 2013 filing of these cases (…).

All the studies that were performed after Dr. Cooke’s initial study and that showed an increase in nitric oxide utilized doses higher than 1.5 to 2 grams per day in a chronic dosing, whereas several studies that have been published and claimed that L-arginine is ineffective in increasing nitric oxide were using doses of 1 to 1.5 grams and below.

(…) J.A. 10456. Asked “you said showed 1 gram was ineffective; is that correct?,” he replied, “1 gram and below was ineffective.” Id. “Q: According to studies? A: Yes.” Id. At trial, he was asked: “And administering 1 gram or less of a supplement is not going to affect the arginine—excuse me, is not going to meaningfully affect the arginine level in one’s plasma, correct?” J.A. 10463. He answered: “That’s correct.” Id. The district court committed no clear error in finding one gram necessary for the claimed efficacy.

Finally, given this evidence, we see no error in the district court’s attribution to plaintiffs of knowledge of the one-gram minimum. Their expert testified that this minimum was revealed in the public literature. It is not an abuse of discretion in these circumstances to fault plaintiffs for failing to learn this public-literature information before bringing suit, whether by hiring an expert or otherwise.

The district court also committed no reversible error in determining that plaintiffs did not conduct adequate investigations to apply the one-gram minimum to the accused products. Importantly, it was not disputed in the district court that “all the relevant products were publicly available.” Fees Op., 2017 WL 1235766, at *5. Nor was it disputed that plaintiffs could have determined the amounts of L-arginine or its hydrochloride salt (in the recommended servings of the accused products) by performing what Vital characterized as a “simple test.” J.A. 10537; see also J.A. 10710 (Hi-Tech’s motion). Nor, finally, does the record reveal that plaintiffs performed such a test.

We have explained that testing of an accused product is not necessarily a required part of an adequate pre-filing investigation. See Intamin Ltd. v. Magnetar Techs., Corp., 483 F.3d 1328, 1338 (Fed. Cir. 2007) (testing not required where high obstacles to testing); Q-Pharma, Inc. v. Andrew Jergens Co., 360 F.3d 1295, 1302−03 (Fed. Cir. 2004) (testing unnecessary for purposes of Rule 11 and § 285 where the product labels, among other things, supported infringement). Whether testing is necessary for a responsible accusation of infringement necessarily depends on the availability of the products at issue, the existence and costs of testing, and whether other sufficiently reliable information exists. Here, given the deficiencies of the two possible alternatives to testing (product label ingredient lists and product advertising), we see no error in the district court’s determination that this matter was one in which there was no adequate substitute for simple testing of publicly available products.

The district court noted that there was some, though slim, evidence that plaintiffs examined the labels of the accused products. Fees Op., 2017 WL 1235766, at *5; Reconsideration Op., 2017 WL 4792426, at *6; see J.A. 10187 (deposition testimony of ThermoLife’s president). But the court agreed with Vital and Hi-Tech that the labels of at least some, perhaps many, of the accused products made clear that they did not contain one gram of L-arginine or its hydrochloride salt in a serving. Fees Op., 2017 WL 1235766, at *5–7. The evidence supports that determination.

The label of Vital’s NO Synthesize does not list L-arginine or its hydrochloride salt as an ingredient at all. J.A. 10509.9 The labels of other accused products list L-arginine but in amounts that preclude one gram per serving.

Had plaintiffs investigated, they might have found, as stated in Vital’s evidence credited by the district court, that the amount was less than 5 milligrams per serving. See Fees Op., 2017 WL 1235766, at *6 (citing J.A. 11586).

(…) Those deficiencies in labels either preclude an accusation of infringement or, at a minimum, strongly suggest a need for testing.

(…) Ingredient lists on the labels aside, plaintiffs also relied for their pre-filing investigation on what may be described as advertising by the defendants for their products—including the non-ingredient portions of labels. In some circumstances, a potential infringer’s public assertions about its products may supply, or help to supply, a reliable basis for a patent owner to allege infringement. See Q-Pharma, 360 F.3d at 1302−03 (“Because Q-Pharma obtained a sample of the accused product, reviewed Jergens’ statements made in the advertising and labeling of the accused product, and, most importantly, compared the claims of the patent with the accused product, we conclude that its claim of infringement was supported by a sufficient factual basis.”). But the nature and setting of the assertions can significantly affect their reliability for that purpose. Here, the district court properly found that defendants’ advertising claims were no substitute for simple testing.

(…) The patent statute does not restrict enforceable patent rights to those who practice the patent, to the exclusion of research institutions and their exclusive licensees engaged to perform needed enforcement activities in which the inventors, or research institutions, may lack expertise or experience. See Continental Paper Bag Co. v. Eastern Paper Bag Co., 210 U.S. 405, 424−25 (1908); Broadcom Corp. v. Qualcomm Inc., 543 F.3d 683, 703 (Fed. Cir. 2008); Rite-Hite Corp. v. Kelley Co., Inc., 56 F.3d 1538, 1547 (Fed. Cir. 1995); cf. eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 393 (2006) (rejecting categorical exclusion of non-practitioners from injunctive remedy).

(U.S. Court of Appeals for the Federal Circuit, May 1, 2019, Thermolife International LLC, Board of Trustees of the Leland Stanford Junior University, v. GNC Corp., Docket No. 2018-1657, 2018-1666)

Packaging & Foreign Standards

Packaging & Foreign Standards

Republication : https://www.export.gov/article?id=Foreign-Standards-and-Certification

Packaging and Recycling Laws:

https://www.export.gov/search#/search/articles?q=labeling%20and%20marking&_k=s3909v

European CE Marking Guidance:

https://2016.export.gov/cemark/eg_main_017267.asp

Onerous or Discriminatory Certifications, Standards and Regulations:

File an online complaint with the Trade Compliance Center:

https://tcc.export.gov/Report_a_Barrier/index.asp

Contact the U.S. trade Representative in Washington DC:

https://ustr.gov/

T.H. v. Novartis Pharmaceuticals Corporation, S233898

Labeling: Drug labeling: Warning: Failure to warn: Medical devices: Pre-emption:

If the policy of preventing harm has special relevance to any particular endeavor, surely prescription drug labeling is one. (Sindell v. Abbott Laboratories, 26 Cal.3d at p. 611.) A substantial body of state law serves to protect California consumers from the dangers posed by false, misleading, and inadequate labeling of prescription medications. (See, e.g., Bus. & Prof. Code, §§ 4070-4078.) The United States Supreme Court, too, has recognized the pivotal role of state tort actions “as a complementary form of drug regulation” with respect to drug labeling. (Wyeth, 555 U.S. at p. 578; see id. at p. 579 [“State tort suits uncover unknown drug hazards and provide incentives for drug manufacturers to disclose safety risks promptly. They also serve a distinct compensatory function that may motivate injured persons to come forward with information. Failure-to-warn actions, in particular, lend force to the FDCA’s premise that manufacturers, not the FDA, bear primary responsibility for their drug labeling at all times”]; accord, Stevens v. Parke, Davis & Co., 9 Cal.3d at p. 65 [recognizing that federal warning-label regulations alone may be insufficient to protect patient safety].)

(…) Cases involving a challenge to the adequacy of a medical device label. Federal law preempts state tort actions based on deficient warnings for medical devices. (Riegel v. Medtronic, Inc. (2008) 552 U.S. 312, 329; cf. Wyeth, supra, 555 U.S. at p. 574 [“despite its 1976 enactment of an express pre-emption provision for medical devices, Congress has not enacted such a provision for prescription drugs”].)

(Cal. S.C., Dec. 21, 2017, T.H. v. Novartis Pharmaceuticals Corporation, S233898).

Exigences en matière d'étiquetages et notices, ici de médicaments et de dispositifs médicaux

Le droit des états, ici californien, protège substantiellement les consommateurs de médicaments des dangers posés par des étiquetages et des notices faux, trompeurs ou inadéquats. La Cour Suprême fédérale a reconnu en la matière le rôle fondamental du droit de la RC des états, qualifié de réglementation complémentaire des médicaments s'agissant de l'étiquetage et des notices. Ces actions en RC peuvent permettre de découvrir des risques associés à la prise des médicaments, et incitent les fabricants à divulguer sans délai des risques nouvellement apparus.

Par le mécanisme de la préemption, seul le droit fédéral s'applique aux actions fondées sur un étiquetage ou une notice défectueuse remise avec un dispositif ou un équipement médical.