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Federal Circuit Affirms Dismissal of Declaratory-Judgment Action Based Under Rule Against Piecemeal Adjudication
On Feb. 5, 2018, a Federal Circuit panel of Judges Prost, Dyk, and Chen issued a unanimous opinion, authored by Judge Dyk, in AbbVie Inc. v. MedImmune Ltd., 881 F.3d 1334 (Fed. Cir. 2018). Despite finding that the district court relied on incorrect grounds, the panel affirmed the dismissal of the action without prejudice due to lack of declaratory-judgment jurisdiction.
Under an agreement that led to the development of the blockbuster antibody drug Humira, Abbvie was obligated to pay MedImmune royalties on 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).” Id. at 1335. In hopes of ending its royalty obligations early, Abbvie brought a declaratory-judgment action in the Eastern District of Virginia, seeking a declaration that the sole patent-at-issue was invalid. While Abbvie argued that the patent's invalidity would constitute its expiration for purposes of the licensing agreement, it did not seek a declaration as to the contract's interpretation.
The district court dismissed Abbvie's action without prejudice on two grounds. First, it held that Abbvie lacked standing to bring a declaratory-judgment action because it was undisputed that Abbvie was not practicing the patent and, therefore, was not at risk of being sued for patent infringement. Second, it held that even if Abbvie had standing, deciding the dispute would implicate questions of foreign law and sovereign immunity because the licensing agreement was governed British law. The district court, therefore, declined to exercise its declaratory-judgment jurisdiction as a matter of discretion.
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