Greetings, Court Fans!
The deluge begins . . . the Court hit us with six opinions yesterday. The decisions were largely uncontroversial (unlike the Jackson verdict!), with two civil cases and four criminal cases, including two Batson cases regarding the use of peremptory challenges during jury selection. We’ll do the other four today, and save the Batson cases for a separate Update later this week.
In Merck KGaA v. Integra Lifesciences I, Ltd. (03-1237), the Court unanimously held that the use of patented compounds in “preclinical” research (i.e., non-human testing) is protected from patent infringement suits if there is a reasonable basis to believe the results would be relevant to an FDA submission. At the risk of revealing our complete scientific ignorance, we’ll try to explain this one. Integra owned five patents to a particular peptide sequence, which was used in Merck-funded preclinical trials looking at the peptide’s effect in treating various ailments. Integra sued Merck for patent infringement, and Merck defended by claiming, among other things, that it was exempt from suit under 35 U.S.C. 271(e)(1), which allows the use of a patented invention “solely for uses reasonably related to the development and submission of information under a Federal law which regulates the manufacture, use, or sale of drugs.” Merck pointed to the Food, Drug and Cosmetic Act (FDCA), which requires drugmakers seeking permission for human testing to submit an investigational new drug application (IND) based on the results of preclinical trials. The results of the Merck-funded trials were not ultimately submitted to the FDA, but they were used to identify drug candidates for future testing, and Merck argued that the trials were reasonably related to its ultimate IND submission. The District Court sent the issue to the jury, instructing the jury that Merck needed to show that the trials contributed “relatively directly, to the generation of the kinds of information that are likely to be relevant” to FDA review. The jury found for Integra, and the Federal Circuit affirmed on the ground that the trials were only general research not conducted to supply information to the FDA.
A Scalia-led Court vacated and remanded, holding that section 271(e)(1) clearly exempts “all uses of patented inventions that are reasonably related to the development and submission of any information under the FDCA,” necessarily including preclinical studies of patented compounds like Integra’s. The Federal Circuit’s construction of the statute, which would exempt only studies that actually showed up in INDs, would wrongly render most drug research subject to infringement suits — you get to the IND stage only after a lot of preclinical testing, which involves trial and error and eliminating poor candidates for future research. If the only way to avoid being sued for infringement is to know for certain that you’ll submit an IND, researchers will be limited to testing generic drugs (which are identical to known effective drugs). Instead, the Court read the statute as leaving “adequate space for experimentation and failure on the road to regulatory approval.” So long as a drug maker has a reasonable basis for believing that the research on a patented compound, if successful, would be appropriate for an FDA submission, it is “reasonably related” and exempt under the statute. Similarly, so long as there is a reasonable basis for believing that a trial will generate the type of information relevant to an IND (or other FDA submission), the fact that the results are not ultimately submitted does not, by itself, defeat the exemption. The Court rejected Integra’s attempt to limit the exemption to preclinical tests relevant to human safety because the FDA requires data in INDs that go beyond safety issues and can be found only through preclinical trials. On remand, the Federal Circuit is to review the sufficiency of the evidence consistent with this construction of section 271(e)(1).
In Grable & Sons Metal Products, Inc. v. Darue Engineering & Manufacturing (04-603), the Court explored the intricacies of federal question jurisdiction in the removal of a state-law title dispute resulting from a federal tax sale (if that doesn’t get you excited, nothing will). Darue purchased Michigan property that the IRS had seized from Grable, and Grable sued Darue to quiet title under Michigan law, claiming that the IRS failed to give Grable proper notice of the seizure. Darue removed the case to federal court, where he won on summary judgment, and the Sixth Circuit affirmed, holding on the jurisdictional issue that, even though Grable had no federal cause of action parallel to his state quiet title claim, the title claim necessarily raised a substantial issue (notice) under federal law. A unanimous Court affirmed, in an opinion by Justice Souter. 28 U.S.C. 1331 grants federal jurisdiction over cases “arising under” federal law, and the Court has long recognized that federal jurisdiction exists where state-law claims implicate substantial federal issues and where it is consistent with Congress’ judgments about the division of labor between state and federal courts. Here, the only contested issue in the case was the adequacy of Grable’s notice under federal law, which was substantial given the federal interest in resolving federal tax cases. Also, while the absence of a parallel federal cause of action may be relevant to Congress’ intent as to the division of labor, state title cases will rarely raise contested federal issues, so federal jurisdiction to resolve this question will have only a “microscopic effect” on the division of labor. Thomas concurred to say that the Court’s rule was clear and faithful to its precedents but that, with better evidence as to the original meaning of 28 U.S.C. 1331, he might be willing to require a federal cause of action to support federal question jurisdiction.
Turning to the criminal cases, in Bradshaw v. Stumpf (04-637), the Court, in an opinion by Justice O’Connor, unanimously held that a guilty plea can be knowing and voluntary even where the Court does not explain the elements of the offense to the defendant so long as there is evidence that “the charge’s nature and the crime’s elements were explained to the defendant by his own, competent, counsel.” The Court also held that a prosecutor’s use of inconsistent theories to convict two individuals for the same murder does not violate due process and require the voiding of a guilty plea where the guilty plea could be sustained under either theory. The Court remanded to the Sixth Circuit for a determination of whether the prosecution’s conduct required that the defendant’s death sentence — as opposed to his conviction — be undone.
Here are the details: Stumpf admitted that, during the course of a robbery, he shot one individual twice in the head (remarkably he lived), but insisted that his accomplice Wesley was responsible for killing another individual. Nonetheless, Stumpf pled guilty to aggravated murder and one capital specification, making him death-penalty eligible. At the penalty phase, Stumpf argued that he played a minor role in the murder, while the State contended that Stumpf was the shooter (and even if he wasn’t, Stumpf’s actions as an accomplice were sufficient to impose death). The sentencing panel found that Stumpf was the shooter. Later, in trying Wesley, the State presented evidence (discovered after Stumpf’s trial) that Wesley had confessed to the murder and argued that Wesley — not Stumpf — was the shooter. The Court found that Stumpf’s guilty plea should not be set aside because there was no evidence that the new evidence of Wesley’s confession was inconsistent with Stumpf’s guilty plea (since an accomplice may be guilty of aggravated murder under Ohio law) and because the new evidence could not have affected the knowing, voluntary and intelligent nature of Stumpf’s plea. On remand, however, the Sixth Circuit could consider whether the State’s use of inconsistent theories impacted the validity of Stumpf’s sentence. Souter and Ginsburg concurred to clarify that Stumpf’s argument, on remand, is not that there was no evidentiary basis for the death penalty or that the prosecutor engaged in misconduct, but “is simply that a death sentence may not be allowed to stand when it is imposed in response to a factual claim that the State necessarily contradicted in subsequently arguing for a death sentence in the case of a codefendant.” These Justices also wondered what the proper remedy would be for such a violation. Thomas and Scalia concurred to note that the Court has never previously recognized this type of due process claim; it appeared that Stumpf had failed to raise it in the state courts; and it would be subject to Teague v. Lane review before consideration on the merits.
Finally, in another unanimous decision, Wilkinson v. Austin (04-495), the Court, led by Justice Kennedy, found that inmates in Ohio’s “supermax” facility possess a “liberty interest” in avoiding assignment to supermax because it imposes an “atypical and significant hardship on the inmate in relation to the ordinary incidents of prison life.” Ohio inmates can be placed in the supermax facility indefinitely and are subject to 23 hour-a-day lock-down, continuous light in their cells, almost no human contact, and no eligibility for parole while in supermax. The Court found, however, that Ohio’s New Policy for placing inmates in supermax provides adequate procedural safeguards, including notice of the basis for placement, an opportunity to attend the placement hearing and provide a rebuttal statement, multiple layers of review, and a 30-day placement review and annual reviews thereafter. The Court applied the Mathews v. Eldrige balancing test to reach this result, concluding that: (1) while the inmates have a liberty interest in avoiding supermax placement, it is not as substantial as that of a person entirely free from confinement; (2) the Ohio procedures provide significant safeguards such that the error rate is unlikely to be decreased significantly by requiring additional procedures (such as the opportunity to call witnesses); and (3) Ohio’s interest in ensuring prison order and safety and in managing scarce funds is entitled to great weight. On remand, the Sixth Circuit may consider whether any prospective relief is required for due process violations under Ohio’s Old Policy, which was admittedly much weaker than the New Policy.
Finally, the Court’s order list granted cert in one case, Wachovia Bank, Nat’l Ass’n v. Schmidt (04-1186), which presents the following questions: (1) whether, for purposes of federal diversity jurisdiction, a national banking association is “located” in, and thus deemed to be a citizen of, every state in which the association maintains a branch, as held by the court below, or instead has a more limited citizenship, as held by three other courts of appeals; and (2) whether the word “located,” as used in 28 U.S.C. 1348, is ambiguous.
We’ll get you summaries on the Batson cases shortly. Until then, thanks for reading!
Ken & Kim
From the Appellate Practice Group at Wiggin and Dana. For more information, contact Kim Rinehart, Ken Heath, Aaron Bayer, or Jeff Babbin at 203-498-4400