Sciele Pharma Inc. (now Known As Shionogi Pharma Inc.), Andrx Corporation, Andrx… v. Mylan Inc. and Mylan Pharmaceuticals Inc.

NOTE: This order is nonprecedential.

# United States Court of Appeals for the Federal Circuit

SCIELE PHARMA INC. (NOW KNOWN AS
SHIONOGI PHARMA INC.), ANDRX
CORPORATION, ANDRX PHARMACEUTICALS
INC. (DOING BUSINESS AS WATSON
LABORATORIES INC. - FLORIDA), ANDRX
PHARMACEUTICALS L.L.C, ANDRX
LABORATORIES (NJ) INC., ANDRX EU LTD., AND
ANDRX LABS L.L.C.,
Plaintiffs-Appellees,
\-

v.
LUPIN LTD. AND LUPIN PHARMACEUTICALS
INC.,
Defendants-Appellants,
v.
MYLAN INC. AND MYLAN PHARMACEUTICALS
INC.,
Defendants.

2012-1118

Appeal from the United States District Court for the
District of Delaware in consolidated case no. 09-CV-0037,
Judge Robert B. Kugler.

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## ON MOTION

Before LOURIE, PROST, and MOORE, Circuit Judges.
MOORE, Circuit Judge.

## ORDER

Lupin Ltd. and Lupin Pharmaceuticals (Lupin) move
for a stay, pending disposition of this appeal, of the pre-
liminary injunction entered by the United States District
Court for the District of Delaware. Sciele Pharma Inc.,
Andrx Corp., Andrx Pharmaceuticals Inc., Andrx Phar-
maceuticals LLC, Andrx Laboratories Inc., Andrx EU
Ltd., and Andrx Labs LLC (Shionogi) oppose. Lupin
replies. Lupin previously requested an expedited briefing
schedule on appeal, which was granted.

To obtain a stay, pending appeal, a movant must estab-
lish a strong likelihood of success on the merits or, failing
that, nonetheless demonstrate a substantial case on the
merits provided that the harm factors militate in its favor.
Hilton v. Braunskill, 481 U.S. 770, 778 (1987). In deciding
whether to grant a stay, pending appeal, this court "as-
sesses the movant's chances of success on the merits and
weighs the equities as they affect the parties and the
public." E. I. du Pont de Nemours & Co. v. Phillips Petro-
leum Co., 835 F.2d 277, 278 (Fed. Cir. 1987). See also
Standard Havens Prods. v. Gencor Indus., 897 F.2d 511
(Fed. Cir. 1990).

The district court's order imposing the preliminary in-
junction failed to even address Lupin's obviousness argu-
ments. The district court did not make any findings of fact
or any conclusions of law regarding Lupin's obviousness
arguments. In its subsequent order denying Lupin's re-
quest for a stay of the injunction, the district court ac-
knowledged Lupin's obviousness arguments, but failed to

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properly address the issue. It simply stated that Lupin
relied on prior art that was before the examiner at the PTO
during prosecution of the patent-in-suit, and therefore
Lupin failed to raise a substantial question that its obvi-
ousness argument is likely to succeed at trial. The fact that
prior art was before the PTO can not be the only reason to
reject an obviousness defense. Lupin is entitled to have the
district court make an independent assessment of its
defense and apply the proper burden of proof.

The district court's failure to make adequate findings of
fact and conclusions of law as to Lupin's obviousness chal-
lenge prevents this court from engaging in meaningful
review of that issue. A court "must find the facts specially
and state its conclusion of law separately." Fed. R. Civ. P.
53(a)(1). "It is of the highest importance to a proper review
of the action of a court in granting or refusing a preliminary
injunction that there should be fair compliance with Rule
52(a) of the Rules of Civil Procedure." Mayo v. Lakeland
Highlands Canning Co., 309 U.S. 310, 316 (1940); Kos
Pharms. Inc. v. Andrx Corp., 369 F.3d 700, 712 n.10 (3d Cir.
2004); see also Nutrition 21 v. United States, 930 F.2d 867,
869 (Fed. Cir. 1991) ("Sufficient factual findings on the
material issues are necessary to allow this court to have a
basis for meaningful review."). Absent appropriate find-
ings, the normal course is to vacate the district court's
decision and remand the matter for a proper analysis. See
Sabinsa Corp. v. Creative Compounds, LLC, 609 F.3d 175,
183 (3d Cir. 2010) ("Typically, when a district court fails to
adequately support its findings, we merely remand for a re-
weighing of the applicable factors."); Pretty Punch Shop-
pettes, Inc. v. Hauk, 844 F.2d 782, 785 (Fed. Cir. 1988)
(same).

Based on the arguments in the motions papers as well
as the district court's order granting the preliminary
injunction and its order denying Lupin's request for a stay

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of the injunction, we determine that the district court has
not made appropriate findings with regard to Lupin's
obviousness arguments.

Accordingly,
IT IS ORDERED THAT:

(1) We vacate the preliminary injunction and remand
this matter for proceedings consistent with this order.

(2) The motion is moot.

FOR THE COURT

FEB 06 2012

/s/ Jan Horbaly

Date

Jan Horbaly Clerk

cc: David B. Bassett, Esq.
Douglass C. Hochstetler, Esq.
Mary B. Matterer, Esq.

FILED
U.S. COURT OF APPEALS FOR
THE FEDERAL CIRCUIT
FEB 06 2012

s24

JAN HORBALY
CLERK