The opinion of the court was delivered by: Chin, District Judge.
In this case of first impression, plaintiff, the manufacturer
of a national brand nicotine gum, seeks to enjoin defendants from
marketing a competing generic version of the nicotine gum with
"labeling" — an instructional booklet and audio tape
— that is "strikingly or substantially similar" to
plaintiff's "labeling." Defendants' principal defense to the
claim of copyright infringement is that they were required by the
Food and Drug Administration (the "FDA") to use "labeling" that
was "the same as" the labeling approved for use with the national
brand. Plaintiff moves for a preliminary injunction.
For the reasons that follow, the motion for a preliminary
injunction is granted. The following constitute my findings of
fact and conclusions of law.
Defendants Watson Pharmaceuticals, Inc., Watson Laboratories,
Inc., and Circa Pharmaceuticals, Inc. (collectively, "Watson")
manufacture a generic or private label version of Nicorette, sold
as "Nicotine Gum" or "nicotine polacrilex, USP." Watson's
nicotine gum product is intended to compete directly with
Nicorette. Watson received approval from the FDA earlier this
year to market the product, and it had planned originally to
"launch" the product on August 1, 1999. (First Wilkinson Decl.
The Watson product is accompanied by a user guide and audio
tape that are virtually identical to SmithKline's Guide and Tape.
The text of the two tapes is identical (except for the product
names). Although some of the music on the two tapes is different,
some of the music is identical. The text of the two user guides
is also identical (except for the names). The graphics in the
Watson guide have been changed from the graphics in SmithKline's
Guide, but only slightly; for example, instead of the father and
a dog found in the SmithKline Guide drawing, a mother and a cat
appear in the Watson version.
SmithKline commenced this action for copyright infringement to
enjoin Watson's alleged willful and infringing copying of the
Guide and Tape. Watson's principal defense is that its user guide
and audio tape were part of the "labeling" approved by the Food
and Drug Administration (the "FDA"). Watson contends that the
Federal Food, Drug, and Cosmetic Act (the "FFDCA") requires that
the labeling for a generic drug be "the same as" the labeling
approved for the "listed," or brand name, drug, 21 U.S.C. § 355
(j)(2)(A)(v), and notes that the FDA regulations broadly
define "labeling" to include "all written, printed, or graphic
matter" as well as "booklets" and "sound recordings." 21 C.F.R.
§§ 1.3(a), 202.1(1)(2). Watson relies heavily on the fact
that during the approval process for its nicotine gum, when it
submitted proposed text for an audio tape substantially different
from the text of the SmithKline Tape, the FDA rejected the
proposed text, advising Watson in a letter dated April 16, 1998
The text for your proposed audio is not the same as
that for the reference listed drug, Nicorette. . . .
Please revise your tape text to be in accord with
that of Nicorette.
(DelGaudio Decl., Ex. C).
On July 28, 1999, SmithKline obtained a copy of Watson's guide
for its nicotine gum product from the FDA. It did not obtain a
copy of a transcript of Watson's audio tape from the FDA until
August 24, 1999. (First Quesnelle Aff. ¶ 32). SmithKline
commenced this lawsuit two days later, on August 26, 1999.
The same day that suit was filed, unbeknownst to SmithKline,
Watson commenced shipments of its nicotine gum product to its
retailer customers. Shipments continued through August 28, 1999,
and a total of some twenty-two million pieces of gum were shipped
by "Next Day Air." (Wilkinson Decl. ¶ 10).
On August 27, 1999, the day after suit was filed, I issued an
order directing Watson to show cause why a preliminary injunction
should not be issued enjoining it, during the pendency of this
action, from selling or shipping its nicotine gum with a user's
guide, audio tape, or other packaging insert "strikingly or
substantially similar" to SmithKline's Guide and Tape. SmithKline
did not request a temporary restraining order at that time. The
for a preliminary injunction was made returnable September 15,
On August 30, 1999, Watson announced that it had "launched" its
nicotine gum product. SmithKline learned on September 1, 1999
that Watson had shipped product to four customers (retail
chains). (9/2/99 Tr. at 2). Concerned that Watson had commenced
or was about to commence shipments, SmithKline requested a
temporary restraining order. At a conference on September 2,
1999, Watson agreed to refrain, pending a hearing on SmithKline's
motion for a preliminary injunction, from making any additional
shipments, without prior ...