Improper Cross Appeals

By Jason Rantanen

Aventis Pharma S.A. v. Hospira (Fed. Cir. 2011) (precedential order) Download 11-10181047 order
Panel: Prost, Mayer, and Moore (author)

The Federal Circuit has repeatedly warned about improper cross-appeals.  Last week, the court issued a precedential order expressing its frustration with appellees who engage in this practice in violation of the court's clear rules, threatening sanctions should future parties continue to disregard its warning. 

Aventis is in the process of appealing a judgment finding all of the asserted claims of the patents involved in its infringement suits against Apotex and Hospira invalid for obviousness and unenforceable due to inequitable conduct.  In response, Apotex filed a cross-appeal to preserve its ability to challenge the district court's ruling that some of the asserted claims were not invalid on another ground, double-patenting, and to argue noninfringement.  After Apotex declined to withdraw its cross appeal, Aventis filed a motion to dismiss.

The motions panel was unsympathetic to Apotex.  "Our precedent consistently warns against the improper use of a cross-appeal to reach issues that do not otherwise expand the scope of the judgment. A cross-appeal may only be filed “when a party seeks to enlarge its own rights under the judgment or to lessen the rights of its adversary under the judgment.”"  Slip Op. at 3 (quoting Bailey v. Dart Container Corp., 292 F.3d 1360, 1362 (Fed. Cir. 2002).  Apotex's conduct was particularly egregious because it was exactly the type of cross-appeal that the court previously ruled improper in TypeRight Keyboard Corp. v. Microsoft Corp., 374 F.3d 1151, 1157 (Fed. Cir. 2004).  That rule, the CAFC noted, is clear.  "Where [] the district court has entered a judgment of invalidity as to all of the asserted claims, there is no basis for a cross-appeal as to either (1) additional claims for invalidity or (2) claims of noninfringement."  Slip Op. at 4, quoting TypeRight at 1157.

After concluding that Apotex's attempts to distinguish TypeRight were without merit, the court issued a strongly-worded warning about the practice of filing improper cross-appeals: 

As Apotex points out, we have not sua sponte struck every improperly filed cross-appeal. This infrequent leniency is not an invitation to flaunt our practice and precedent, and the improper use of a cross-appeal directly contrary to our precedent may meet with sanctions. We understand Aventis plans to seek attorneys’ fees and costs incurred in connection with the motion to dismiss Apotex’s improper cross-appeal, and will evaluate its request in due course.

Slip Op. at 5.

Why do parties file cross appeals?
Although parties may file improper cross appeals because they are legitimately concerned about waiving the ability to challenge a district court ruling, cross-appeals also give appellees procedural benefits.  In a typical Federal Circuit appeal, the appellant is permitted to file a 14,000 word opening and a 7,000 word reply brief while the appellee may file one 14,000 word opposition brief.  When a cross-appeal is involved, the appellee may file a 16,500 word opposition brief and a 7,000 word cross-appeal reply (the appellant is allotted 14,000 words for its reply).  This give the appellee an extra 9,500 words – a precious commodity – along with the last word on the cross-appeal issues.  But obtaining this advantage in contravention of the rules constitutes gaming the system – and as the court in Aventis noted, "this is neither fair to the appellant nor an efficient use of the appellate process."  Slip Op. at 3.

Apotex likely got off lucky.  If the court had waited until the briefing was complete, Apotex could have had its cross-appeal arguments disregarded altogether, even those it could have raised as alternate grounds for affirmance.  As the court noted, however, Apotex will now be able to make those arguments in its appellees' brief if it so chooses.  And should the court decline to grant Aventis's request for attorneys' fees and costs, its opinion may have little deterrant effect – unless the court steps up enforcement or imposes some noteworthy sanction for blatantly improper cross appeals, appellants may continue to flaunt its practice in order to gain the procedural advantage a cross-appeal offers.

30 thoughts on “Improper Cross Appeals

  1. I agree with the above post.

    The court should get a handle on the extent of the problem before it goes any further.

  2. Jason–

    I don’t know if there is an easy way to do it through data mining, but it might be interesting to find some numbers:

    1) what proportion of CAFC appeals, patent and other, include cross-appeals, and

    2) what proportion of CAFC cross-appeals, patent and other, were effectively moot–i.e. were incapable of enlarging the cross-appellant’s rights under the judgment or of lessening the rights of its adversary under the judgment.

  3. Dhuey–

    There would certainly be some inefficiency in having to re-start the process, but such inefficiency would only be occasioned IF the process was required to be re-started.

    And such conditional inefficiency would need to be weighed against the inefficiencies that inhere in any other manner of addressing the respondent’s issues, in scenarios more or less like those Babel Boy outlined.

    I know that docketing and scheduling are the essential foundations for the CAFC’s operation, and that to tinker with them could wreak havoc–but at this point, the issue seems to me to boil down to what flavor of havoc the court prefers.

  4. Let’s see if I can clarify. Option 1 is what the court’s precedent requires. I think that this is the right rule, but mine is not a particularly strong position. The more contentious issue is whether disregarding this precedent is a good idea or not. Perhaps it is, but in my view the rule is clear enough in this particular scenario to make the cross-appeal frivolous – and generally, lawyers should not be making frivolous arguments.

    On Option 2, I’d need to research other circuits’ practices before I could say whether or not this is the case. Still, it seems counterintuitive to me that a defendant who prevailed in, say, a trademark suit on the ground that the mark was generic would be able to cross-appeal on the ground that the plaintiff did not use the mark in commerce. That seems to be an alternate ground for affirmance, not a separately appealable issue.

    I don’t think Option 3 is a possibility because there would be no adverse judgment for Apotex to appeal. It couldn’t have filed an appeal in the first instance. Now, if it had won because of noninfringement, but lost on validity or inequitable conduct – then it could have a basis for an appeal.

  5. I’d be interested to see the briefs on the motion in this case. As comments indicate, in some cases there’s a bit of a gray area; in others, not so much.

    For all the Federal Circuit’s testiness over improper cross-appeals, I don’t know if I’ve ever seen an opinion from another circuit complaining about this issue. I suppose one of the unique features of patent law is the way infringement, invalidity and unenforceability claims arise and intersect, but I have to wonder if the Federal Circuit’s testiness here is warranted.

    Also, minor grammar point but when you’re a federal judge with smart clerks and several other pairs of eyes on your precedential opinions you should know better–it’s flout, not flaunt. As the Economist puts it, “If you flout this distinction, you will flaunt your ignorance.” link to economist.com

  6. But how often would it be that ruling in the appellee’s favor in the appeal would resolve a properly-filed cross-appeal? I suspect not that often; at least not often enough to justify bifurcating the whole appellate process. I think efficiencies gained in avoiding moot cross-appeals would be more than offset by the inefficiencies of having to restart the process after resolving the appeal. With the constant turnover of judicial clerks, many of the clerks who handled the appeal will have left the court when it’s time to work on the cross-appeal.

    Has any regional circuit court experimented with this approach? I believe they could if they considered it a good idea.

  7. Jason, I’m not tracking this very well, partly because of the Chardonnay and partly because the litigants’ names both begin with “A”.

    Apotex won on the issues of obviousness and IC. But they lost on their allegations of invalidity because of double-patenting, which I believe goes not to the whole patent but to individual claims.

    For all Apotex knows the trial court will get reversed on obviousness and IC and Apotex will be left without any judgment at all. So what is the proper way for them to preserve the double-patenting issue? I can see 3 options:

    Option 1. Apotex wastes a bunch of their reply brief to raise the separate and independent double-patenting issue. This is the CAFC’s option and appears to be yours.

    Moore: “Our practice with respect to cross-appeals does not limit the arguments that can be presented on appeal. Attorneys are free to devote as much of their responsive briefing as needed to flesh out additional arguments and alternative grounds for affirming the judgment on appeal.”

    I don’t know what your motive is but the CAFC is obviously just being its usual lazy self and wanting to cut down on its work as much as possible by forcing the appellee to burn off reply brief pages raising issues that were not raised in the appeal brief, which they will also get spanked for.

    Option 2. Apotex cross-appeals on any issues — i.e. the double-patenting issue — that it thinks the trial court scrwed, which is, apparently, what most circuits allow to be sure everything gets aired.

    Option 3. Apotex files its own independent appeal to test the double-patenting. Oh that’s great, now everybody’s work is doubled.

    I’m not being argumentative; just confused as to what it is the CAFC is doing and what it expects.

    Sounds like another slap-back from USSCt coming — I note Moore cites no USSCt cases in support.

  8. Dhuey–

    When you said that “It would be better for the court to consider all issues on appeal together given the factual and legal overlap.”, you assumed what you set out to prove.

    That would most definitely not be better for the court, if issues in the initial appeal are resolved in the respondent’s favor. That is the whole point of the decision–economy.

    It’s hard to make sense of what you meant when you said: “If a cross-appeal is proper, then it will usually be necessary for the court to analyze and resolve it, no matter what the court does with the appeal.” It seems self-contradictory.

    Whether or not the court must address a cross-appeal is entirely dependent on timing. They could procedurally shift consideration of the cross-appeal issues until after the initial appeal issues have been adjudicated, without any prejudice to the parties. If the respondent is then not in a position “…to enlarge its own rights under the judgment or to lessen the rights of its adversary under the judgment…”, then it could be determined that the cross-appellant lacks standing to invoke the court’s jurisdiction to adjudicate the cross-appeal, and the cross-appeal could be dismissed upon that basis.

    Alternatively, a Rule 42(b) motion could be made by the original appellant, and the appeal could be dismissed, if done properly, without any prejudice to either party.

  9. I’m guessing not so many defendants file cross-appeals in criminal cases. Maybe if the prosecution appeals a sentence as unlawfully lenient and the defendant cross-appeals, arguing the sentence is unlawfully harsh.

  10. TACOMA — Two Jesuit priests, a nun, a retired teacher and a social worker who cut through fences at Naval Base Kitsap-Bangor over a year ago to protest nuclear weapons were each sentenced to prison Monday.

    Jesuit priest Stephen Kelly, 61, of Oakland, Calif. and retired teacher Susan Crane, 67, of Baltimore, were given 15-month sentences, while social worker Lynne Greenwald, 61, of Tacoma, was given a 6-month prison sentence.

    The judge gave lighter sentences to the two protesters who were over 80 years old. Jesuit priest Bill Bichsel, 82, of Tacoma, was sentenced to three months in prison and three months of home monitoring, while sister Anne Montgomery, 84, of Redwood City, Calif, was sentenced to two months in prison and four months home electronic monitoring. show more show less

    I wonder if their attorneys filed any unauthorized cross-appeals.

  11. A sanction of a few thousand dollars coupled with a warning that any future violations of the rule might result in removal from the CAFC bar would do the trick.

  12. these improper cross-appeals will disappear quickly if the court starts issuing some attorney fee sanctions

    That will only be true if the sanctions are deeply painful and actually hurt somebody financially in a meaningful way (i.e., vacation home needs to be sold; kid needs to go to public school instead of private school; etc).

  13. “When the cost is minor (getting a harmless tongue-lashing), the incentive is certainly to file first and ask questions later.”

    That’s a clear rule, too.

    If the downside of getting busted is minimal, then break the rule.

    Remember, these are rules for rich people with fancy lawyers. They are made to be broken. Rest assured: nobody is going to jail or getting disbarred or having their entire case thrown out of court for filing a cross-appeal that breaks some silly rule.

    So just do it. If nothing else, there’s a chance that the other side might not get their attorney’s fees back, and the cross-appeal might be the bloodletting that breaks the bank.

  14. IBP, my sense is that would be an inefficient approach. If a cross-appeal is proper, then it will usually be necessary for the court to analyze and resolve it, no matter what the court does with the appeal. It would be better for the court to consider all issues on appeal together given the factual and legal overlap.

    As Jason suggested, these improper cross-appeals will disappear quickly if the court starts issuing some attorney fee sanctions.

  15. Dhuey–

    So why don’t they do as I suggested above, with an extended adjournment after adjudication of the issues on initial appeal, to then consider the extra briefing, if and as required?

    The jurisdictional issue could be satisfied by not having jurisdiction attach until such time as the respondent is put in the appropriate position. The court would have done nothing regarding cross-appeal issues save for acknowledging receipt of briefs directed thereto.

    After all, the court accepts all sorts of filings, all sorts of which have nothing to do with invoking the jurisdiction of the court upon receipt thereof.

  16. My guess is that what bothers the court most about improper cross-appeals is that they waste the court’s time. It’s not really that they give one party an unfair advantage. The judges and clerks have to read and consider the extra briefing, and when they are done they realize that it all could have been included in the appellee’s principal brief.

  17. Maurice:

    The inflexibility on this point derives from the fact that it is based on the appellate court’s jurisdiction. If a party is not “adversely affected” by a judgment, it lacks standing to file an appeal, or cross-appeal, of that judgment.

    Where a defendant has prevailed on invalidity of the asserted claims, that party is not adversely affected by the judgment, even if the court found the claims infringed or rejected other grounds for invalidity. In that situation, if the patent owner never files any appeal, the defendant cannot file one either, as the invalidity finding trumps the infringement finding (as invalidity prevents any future products from being accused as well), and thus, the defendant is not adversely affected by the judgment. It therefore follows that the defendant cannot cross-appeal, either. It non-infringement arguments become an alternative basis in its appeal response brief to affirm the judgment.

    Lawyers will continue filing cross-appeals in “gray” areas to avoid potential malpractice liability. I think this decision is helpful in that it makes clear a defendant cross-appealing on non-infringement when the judgment finds invalidity is not proper and is not a “gray” area.

  18. Good comments, and they reflect my own practice before the court – when there are gray areas, and the incentives are so heavily weighted in one direction, the best course of action is just to file. And certainly the CAFC is fairly lenient when it comes to most cross-appeals. But in this particular situation – when a appellee files a cross-appeal despite having obtained a trial court judgment of invalidity/inequitable conduct on all claims – the rule seems clear enough and well enough established that parties should be able to follow it, regardless of the weighing of incentives.

  19. When the cost is minor (getting a harmless tongue-lashing), the incentive is certainly to file first and ask questions later.

    This comment should be framed and placed permanently at the top of the blog.

  20. OT -

    Big D – your comment thread on the Bilski post is misfiring big time – I cannot get my fix o chuckles.

  21. This case isn’t even close. Apotex won a judgment of unenforceability below. The attorneys who filed the cross-appeal should be embarrassed.

  22. Are the extra words really such a procedural advantage? Maybe in the exceptional case, but I think the consensus among judges and clerks is that brevity and clarity (closely related virtues) win you lots of points with the court. Likewise, I’m not convinced that having the last word is so valuable. The appellee should be able to anticipate points in reply and address them in its principal brief.

  23. Yes, why doesn’t the court just adjudicate the original appeal first, in its entirety, and then decide based on the outcome whether the original respondent is then in a position “…to enlarge its own rights under the judgment [in the appeal] or to lessen the rights of its adversary under the judgment [in the appeal]…”, and then proceed to adjudicate the issues presented on cross-appeal, as required?

  24. While the Federal Circuit has the right to control its docket by implementing procedural rules such as this, I wonder whether this rather inflexible rule is wise. Wouldn’t it be better for the Federal Circuit to encourage the parties to brief all issues decided below so as to assure that they can be adudicated in a single appeal if necessary? Further, this strict limitation on the scope of cross-appeals is arguably inconsistent with the Federal Rules of Appellate Procedure (which allows cross-appeals), and it is certainly inconsistent with customary appellate practice in which cross-appeals are appropriate in any situation where otherwise there might be concerns about waiving rights to appeal from determinations of the trial court. While this rule may reduce the number of briefs that Federal Circuit panels must study, does it really serve the interests of efficiency and fairness?

  25. Thanks for the write-up, Jason.

    I would just add that patent litigators often fear a malpractice suit more than they fear the type of sanction that might flow from filing an improper cross appeal. In a close case, or one that appears close, they’re going to file the cross appeal and take their chances with the court.

  26. Jason — in a lot of ways I agree with you, but at a very high meta level I just don’t like the Federal Circuit’s sharp dichotomy and the fall-off-a-cliff consequence. I can agree that Apotex’s motivation was probably to gain the procedural advantage, given that there was a previous case that was pretty much directly on point.

    But while I think that the TypeRight holding was both directly applicable here and probably correct as a matter of doctrine, if I were Apotex’s counsel I would be still a little nervous not filing a cross appeal even without considering the illegitimate procedural considerations. After all, while the chance is small there is no guarantee that the Federal Circuit wouldn’t reconsider TypeRight, or the Supreme Court might not later hold that non-infringement is a distinct ground that requires cross-appeal given Cardinal Chem, and since the issue is jurisdictional it can be raised at any time, even after the other side loses on the merits. Nobody wants to be in the position of Keith Bowles in having the court suddenly change its precedent and yet holding you to its newly created jurisdictional bar. When the cost is minor (getting a harmless tongue-lashing), the incentive is certainly to file first and ask questions later. But fundamentally I’m skeptical that this is something we actually want to deter in this context, or that we can separate out this type of protective action from those seeking to gain illegitimate procedural benefit.

  27. Tj – I agree that cross appeals are often legitimate. However, the scenario in this case is one that arises with surprising frequency – and is not all that much of a gray area. If the appellee obtains a judgment of invalidity and unenforceability, a cross appeal is very rarely appropriate, and probably never if it is based on alternate grounds of invalidity or noninfringement.

    Clarified the last sentence to indicate the concern is with the types of cross appeals for which the court has repeatedly issued warnings.

  28. As you note, though, parties file improper cross-appeals for two potential reasons, one legitimate and one illegitimate. It is actually quite difficult to figure out whether a cross appeal is required, and there is no gray zone: either the cross-appeal is unnecessary or improper, or it is proper and mandatory — you waive the issue by failing to appeal. My favorite demonstration of this get-it-right-or-fall-off-a-cliff phenomenon is Granite Management Corp. v. U.S., 416 F.3d 1373 (Fed. Cir. 2005).

    Your last sentence seems to imply that you think most appellees file the cross appeal to gain illegitimate procedural advantage. I’m not so sure that is the main motivation. An extra 9500 words is not really that much of a help: a judge and clerk’s attention span is still the same, so the 10000 word brief is usually more effective than the 20000 word brief. On the other hand, a waiver holding almost invites a malpractice suit.

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