182 F.3d 1003 (D.C. Cir. 1999)
Teva Pharmaceuticals, USA, Inc.,Appellantv.United States Food and Drug Administration, et al.,Appellees
No. 99-5022 Consolidated with No. 99-5027
United States Court of AppealsFOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued April 26, 1999Decided July 20, 1999

Appeals from the United States District Court for the District of Columbia(No. 99cv00067)
Geoffrey M. Levitt and James N. Czaban argued the cause  for appellant.  With them on the briefs was David M. Malone.
Robert A. Dormer, James R. Phelps and Douglas B. Farquhar were on the brief for appellant Purepac Pharmaceutical Company.
Andrew E. Clark, Attorney, U.S. Department of Justice,  argued the cause for the federal appellees.  With him on the  brief were David W. Ogden, Acting Assistant Attorney General, Eugene Thirolf, Jr., Director, Office of Consumer Litigation, and Drake S. Cutini, Attorney.
James D. Miller argued the cause for intervenors-appellees  TorPharm, a Division of Apotex, Inc., et al.  With him on the  brief were Eugene M. Pfeifer, Peter M. Todaro, Donald O.  Beers and David E. Korn.
Before:  Edwards, Chief Judge, Rogers, Circuit Judge and  Buckley, Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge Rogers.
Rogers, Circuit Judge:


1
Teva Pharmaceuticals and Purepac  Pharmaceutical Company appeal the denial of injunctive relief  requiring the Food and Drug Administration ("FDA") to  recognize the dismissal of a declaratory judgment complaint  for patent infringement as a "court decision" under the  Abbreviated New Drug Application ("ANDA") statute.  See  21 U.S.C. § 355(j)(5)(B)(iv)(II) (Supp. III 1997).  Appellants  are "subsequent" ANDA applicants hoping to market ticlopidine tablets, a generic version of the name-brand drug "Ticlid," used to treat stroke victims.1  To meet the requirements of the ANDA statute, Teva sued the patent holder2 in  the Central District of California in order to obtain a "court  decision" that would start, or trigger, a 180-day period of  market exclusivity for the first ANDA applicant, and thereafter allow appellants to market their generic drug.  The  California court dismissed the complaint for lack of subject matter jurisdiction after finding, based on the patent holder's  admission of non-infringement, that Teva lacked a reasonable  apprehension of suit by the patent holder.  The FDA never the less refused to recognize the dismissal as a triggering  "court decision" under the ANDA statute.  Because we conclude that the FDA's refusal was arbitrary and capricious  inasmuch as the FDA has taken an inconsistent position in  another case and failed to explain adequately the inconsistency, we reverse and remand the case to the district court to  determine anew whether injunctive relief is appropriate.

I.

2
The statutory background is succinctly summarized as follows.  In 1984, Congress amended the Food and Drug Act in  order to expedite the approval of generic versions of namebrand drugs that already have FDA approval, thus making  available more low-cost generic drugs.  See Drug Price Competition & Patent Term Restoration Act of 1984, Pub. L. No.  98-417, tit. I, 98 Stat. 1585 (1984) (codified as amended at 21  U.S.C. § 355 (1994 & Supp. III 1997));  see also H.R. Rep.  No. 98-857, pt. 1, at 14 (1984), reprinted in 1984 U.S.C.C.A.N. 2647, 2647.  Under the so-called Hatch-Waxman amendments, an abbreviated new drug application process allows  applicants, upon meeting certain requirements, to proceed  more quickly to the marketplace.  The ANDA applicant must  show that:  (i) the use of the drug has been previously  approved;  (ii) the new drug contains the same active ingredient(s) as the previously approved drug, or document the  differences;  (iii) the new drug has the same route of administration, dosage form, and strength of the previously approved  drug, or document the differences;  (iv) the new drug is the  bioequivalent or has the same therapeutic effect as the previously approved drug;  (v) the new drug has the same labeling  as the previously approved drug, or the differences are  approved;  and (vi) it has complied with other statutory  requirements, which include providing a full list of articles  used as components, a full statement of composition, samples  of the drug, labeling specimens, and a description of manufacturing, processing, and packaging.  See 21 U.S.C. § 355(j)(2).


3
To avoid the patent infringement problems inherent in such  a statutory scheme, the ANDA applicant must provide the  FDA with a certificate establishing that the marketing of the  generic drug will not infringe the patent for the listed drug.To this end, the applicant must certify that:  (I) the patent  information has not been filed, (II) the patent has expired,  (III) the patent will expire on a specified date, or (IV) the  "patent is invalid or will not be infringed by the manufacture,  use, or sale of the new drug for which the application is  submitted."  Id. § 355(j)(2)(A)(vii).  As part of a certification  under Paragraph IV, the ANDA applicant must notify the  patent holder and approved applicants of its application and  include a statement of the factual and legal basis for the  applicant's opinion that the patent is not valid or will not be  infringed.  See id. § 355(j)(2)(B).  Under FDA regulations,  the applicant may also certify that the patent is unenforceable.  See 21 C.F.R. § 314.94(a)(12)(i)(A)(4) (Westlaw 1999).


4
ANDA applicants who submit Paragraph IV certifications  are subject to a "market-exclusivity provision," see 21 U.S.C. § 355(j)(5)(B)(iv), under which previous applicants are granted 180 days during which subsequent applications cannot be  approved.3  This period is started, or triggered, by the earlier  of (1) the date the Secretary of Health and Human Services  receives notification from the previous applicant of the first  commercial marketing of its drug or (2) the date of a "decision of a court" in a patent or declaratory judgment action  "holding" that the patent is either "invalid or not infringed."Id.;  see also id. § 355(j)(5)(B)(iii) (describing suits for patent  infringement or declaratory judgment).


5
Heretofore, the court invalidated the FDA's "successful  defense" requirement, whereby the first ANDA applicant  could obtain 180 days of market exclusivity only after successfully defending a patent lawsuit.  See Mova Pharm. Corp. v.  Shalala, 140 F.3d 1060, 1076 (D.C. Cir. 1998).  Accord  Granutec, Inc. v. Shalala, No. 97-1873, 1998 WL 153410, at  *7 (4th Cir. April 3, 1998).  In response, the FDA issued a  "Guidance for Industry" announcing its intention to promulgate new regulations on market exclusivity and "until such  time as the rulemaking process is complete," to "regulate  directly from the statute, and ... make decisions on 180-day  generic drug exclusivity on a case-by-case basis."  See Guidance for Industry:  180-Day Generic Drug Exclusivity Under  the Hatch-Waxman Amendments to the Federal Food, Drug  and Cosmetic Act 4 (June 1998) ("Guidance for Industry").The court upheld this approach in Purepac Pharmaceutical  Co. v. Friedman, 162 F.3d 1201, 1204-05 (D.C. Cir. 1998):  the  FDA may regulate directly from the statute and is not  required to maintain any litigation requirement in determining the first applicant's entitlement to 180 days of market  exclusivity.

II.

6
Teva challenges the denial of injunctive relief on the principal ground that the FDA's refusal to treat the dismissal of  Teva's declaratory judgment action as a triggering "court  decision" is inconsistent with the ANDA statute and hence,  the district court erred in ruling that Teva had failed to  demonstrate a likelihood of success on the merits.  Basically,  Teva contends that the California dismissal is functionally  equivalent to a final decision of noninfringement and unenforceability on the merits because it was based on the patent  holder's express representation to Teva and the California  court that Teva's formulation did not infringe the patent and  that the patent holder would not sue Teva for infringement. Indeed, Teva goes so far as to maintain that its interpretation  of the statute is the only possible alternative to the FDA's  impermissible construction under the circumstances of this  case;  otherwise, subsequent ANDA applicants' efforts to use  the Hatch-Waxman procedure could be thwarted anytime a  patent holder stated that it did not intend to enforce its  patent, thus preventing the courts from exercising subject  matter jurisdiction to issue the holding of noninfringement  that the FDA's position requires.


7
According to Teva's complaint, on June 20, 1997, Teva filed  its ANDA to market ticlopidine, a generic version of the drug  "Ticlid."  While it awaited tentative approval of its application, Teva sued Syntex, seeking a declaratory judgment of  noninfringement of Syntex's patent for a finished dosage  formulation of ticlopidine tablets.4  On the same day, Syntex  sent Teva a letter expressing the opinion that Teva would not  infringe Syntex's patent, declaring:  "We will make no claim  of patent infringement based on the sale of ticlopidine hydrochloride tablets having the formulation you have disclosed to  us."  Thereafter, Teva prepared a joint motion for entry of consent judgment that would hold Syntex's patent not infringed; but Syntex instead moved to dismiss the complaint for  lack of subject-matter jurisdiction, explaining:


8
Given Syntex's express assurance that it would not bring suit against Teva on the '592 patent, Teva can have no reasonable apprehension that it will face a lawsuit for infringement of the '592 patent.  Without such reason-able apprehension, no actual case or controversy exists of sufficient immediacy or reality to base jurisdiction over Teva's declaratory judgment claim.


9
Accompanying the motion was a declaration by John Parise,  counsel for Syntex, referring to the June 8, 1998, letter that  Syntex sent Teva stating that Syntex would make no claim of  patent infringement against Teva.  Noting that under Federal Rule Civil Procedure 12(b)(1) the district court could  consider materials outside of the pleadings, see Dreier v.  United States, 106 F.3d 844, 847 (9th Cir. 1997), Syntex  attached a proposed order with three findings, including that  Teva "lacked and lacks a reasonable apprehension of suit by  Syntex for infringement of [the] ... [p]atent."  The district  court granted Syntex's motion, adopting its findings, specifically that Teva "lacks a reasonable apprehension of suit by  Syntex for infringement of [the patent];"  hence there was "no  justiciable case or controversy between the parties concerning  any infringement by Teva of the '592 [p]atent," and consequently the court lacked subject matter jurisdiction over the  action.


10
On October 29, 1998, the FDA tentatively approved Teva's  ANDA to market ticlopidine.  However, the FDA informed  Teva that because there was a previous ANDA applicant and  neither commercial marketing nor a court decision had occurred, its application was ineligible for final approval.  Teva  attempted to persuade the FDA that the California dismissal  satisfied the "court decision" requirement, but the FDA did  not respond to Teva's request for an effective approval date  and on December 2, 1998, notified Teva that it refused to  meet to discuss the issue.  Teva then filed the instant lawsuit  in district court for a declaratory judgment that Teva is entitled to have its ANDA become effective on February 10,  1999 (180 days after the California dismissal), an injunction  making Teva's ANDA effective on that date, and a temporary  restraining order to forestall the FDA from approving the  first ANDA application if such approval would give the first  applicant any exclusive marketing beyond February 10, 1999.


11
The district court declined to award injunctive relief.  It  concluded for three reasons that Teva could not demonstrate  a likelihood of success on the merits.  First, the district court  ruled that the California dismissal did not fall within the plain  language of § 355(j)(5)(B)(iv)(II), and, second, that even if  Teva could show that the statute was ambiguous, it was  unlikely to succeed in showing that the FDA's interpretation  was impermissible, or that Teva's interpretation was the only  permissible alternative.  The district court concluded, third,  that Teva's reliance on patent law decisions of the Federal  Circuit was misplaced because they had no direct bearing on  the "court decision" provision in ANDA.  Consequently, the  district court reasoned, in view of language in decisions of this  court,5 that the triggering "court decision" provision required  nothing less than a decision on the merits.  The district court  was also unpersuaded by Teva's arguments concerning irreparable harm, injury to the other parties, and the public  interest.6

III.

12
On appeal, Teva contends that the district court erred in  denying injunctive relief because the California dismissal  qualified as a "court decision" under § 355(j)(5)(B)(iv)(II) and  the FDA's refusal to recognize the dismissal as such was  arbitrary and capricious, an abuse of discretion, and based on  an unreasonable and impermissible interpretation of the statute.  Our review of the denial of injunctive relief is for abuse  of discretion, but we review de novo the district court's conclusion of law, namely that Teva was unlikely to prevail in  its challenge to the FDA's refusal to treat the California  dismissal as a triggering "court decision."  See Mova, 140  F.3d at 1066 (citing CityFed Financial Corp. v. Office of  Thrift Supervision, 58 F.3d 738, 746 (D.C. Cir. 1995)).


13
The FDA maintains that its interpretation of the "court  decision" provision is entitled to deference under Chevron  U.S.A., Inc. v. Natural Resources Defense Counsel, Inc., 467  U.S. 837, 842-44 (1984).  In fact, however, the FDA has  offered no particular interpretation of that provision, relying  instead on its authority to interpret the provision narrowly  until it promulgates a new rule.  Without regard to how the  FDA should address the issue in its next rulemaking, it is  clear that the FDA, consistent with its statement that it  would "regulate directly from the statute" on a "case-by-case  basis," see Guidance for Industry at 4;  see also Purepac, 162  F.3d at 1205, cannot avoid the merits of Teva's contention  that the California dismissal satisfies the "court decision"  requirement under § 355(j)(5)(B)(iv)(II).  We review the  FDA's response to Teva's claim guided by settled principles  of administrative law.  See 5 U.S.C. § 706 (1994);  Southwestern Bell Tel. Co. v. FCC, 168 F.3d 1344, 1352 (D.C. Cir. 1999).Upon a review of the record, we conclude that the FDA's  response was arbitrary and capricious.


14
First, the FDA concedes that its refusal to recognize the  California dismissal as a triggering "court decision" is not  compelled by the statutory language.  The statute requires a  "decision of a court holding the patent ... invalid or not  infringed."  See 21 U.S.C. § 355(j)(5)(B)(iv)(II).  A "decision"  can take several forms, including final judgment after a full  trial, summary judgment or partial summary judgment, or  even a dismissal for failure to state a cause of action.  The  term "holding," most often contrasted with the term "dicta,"  is also susceptible to interpretation.  See, e.g., Seminole Tribe  of Fla. v. Florida, 517 U.S. 44, 66-67 (1996);  Wilder v. Apfel,  153 F.3d 799, 803-04 (7th Cir. 1998);  Gersman v. Group  Health Ass'n, 975 F.2d 886, 897 (D.C. Cir. 1992).  Furthermore, the significance of a court's "decision" or "holding"  often lies in its preclusive effect.  Of course, as intervenors maintain, not every court action can be construed as a  "decision" with a "holding";  for example, a dismissal for lack  of personal jurisdiction is not a decision on the merits and has  no preclusive effect.


15
But the California dismissal cannot be classified as a typical  dismissal for lack of subject matter jurisdiction.  Although, as  a general rule, such a dismissal has no preclusive effect  because the court lacked authority or competence to hear and  decide the case, see Prakash v. American Univ., 727 F.2d  1174, 1182 (D.C. Cir. 1984) (citing 5 C. Wright & A. Miller,  Federal Practice § 1350, at 554 (1969)),7 here the dismissal  was based exclusively and necessarily on Syntex's declaration  that Teva's product would not infringe its patent and its  express disavowal of an intent to sue.  Syntex expressly  sought to have the California court consider more than the  pleadings, notwithstanding its request for dismissal for lack of  subject matter jurisdiction, noting in its motion papers that  the court could grant a motion to dismiss under Federal Rule  of Civil Procedure 12(b)(1) based on materials in addition to  the pleadings themselves.  Before the California court was  Syntex's June 8th letter stating that Teva's "formulation ...  does not infringe" the patent, and the declaration of Syntex's  counsel that Teva's "formulation did not warrant bringing a  patent infringement action."  It also had express findings of  fact proposed by Syntex, including the one necessary for a  finding of no case or controversy, namely that Teva lacked a  reasonable apprehension of suit by Syntex for infringement. Syntex not only remained silent after receiving Teva's notice  of its ANDA filing and failed to file an infringement suit  within 45 days after receiving Teva's Paragraph IV notification, but it also sought to have Teva's complaint dismissed for  lack of subject matter jurisdiction.  It was able to file such a  motion, however, only because of its own statements and  actions eliminating any case or controversy about the enforce ability of the patent against Teva.  Its motion was granted on  the basis of an express finding of fact by the California court regarding Teva's reasonable non apprehension of suit, as Syntex itself had proposed as part of its motion to dismiss. From the perspective of the California court, then, Syntex's  declaration and conduct eliminated the need for a declaratory  judgment because Syntex would be estopped from challenging Teva's marketing of its generic drug on the ground of  patent infringement.


16
The FDA and intervenor TorPharm (the first ANDA filer)  conceded at oral argument that the California dismissal prevents Syntex from suing Teva for infringement.  The conclusion that the California dismissal has estoppel effect is supported by the decisions of the United States Court of Appeals  for the Federal Circuit.  That court has recognized that a  dismissal of a declaratory judgment action for lack of a case  or controversy due to the patent holder's disavowal of any  intent to sue for infringement has preclusive effect.  See  Super Sack Mfg. Corp. v. Chase Packaging Corp., 57 F.3d  1054, 1059 (Fed. Cir. 1995);  Spectronics Corp. v. H.B. Fuller  Co., 940 F.2d 631, 636-38 (Fed. Cir. 1991);  see also Fina  Research, S.A. v. Baroid Ltd., 141 F.3d 1479, 1483-84 (Fed.  Cir. 1998) (discussing Super Sack and Spectronics).  Although the district court here correctly noted that the Federal Circuit was confronted only with cases in which the plaintiff sought a declaratory judgment in order to avoid litigation  and liability for infringement, and did not consider whether  such a decision would have any collateral effect or additional  significance under the ANDA statute, the relevant consideration is the estoppel of the patent holder from later claiming  that the ANDA applicant is liable for patent infringement.


17
Put otherwise, the California dismissal appears to meet the  requirements of a triggering "court decision" because that  court had to make a predicate finding with respect to whether  Syntex would ever sue Teva for infringement in order to  conclude that there was no case or controversy between the  parties.  In dismissing Teva's complaint for lack of subject  matter jurisdiction, the California court expressly found that  Teva "lacks a reasonable apprehension of suit by Syntex for  infringement of [its patent]."  According to Syntex's motion  to dismiss Teva's complaint, that finding could only have been based on the patent holder's declaration of counsel and its  June 8th letter to Teva.  Although the dismissal was not a  judgment on the merits after consideration of evidence presented by the parties, there was no need for such a procedure  here because the dismissal sufficed to estop Syntex from  suing Teva for patent infringement.  See Super Sack, 57 F.3d  at 1059;  Spectronics Corp., 940 F.2d at 638.  This is the  result that appears to be the purpose of the triggering "court  decision" provision.  A contrary view, as Teva contends,  means that the patent holder could manipulate the system in  order to block or delay generic competition by stating that  the patent holder will not enforce its patent against the  Paragraph IV challenger.  See Mova, 140 F.3d at 1073 &  n.18.  For these reasons, the California dismissal would appear to meet the requirements of a "court decision" under  § 355(j)(5)(B)(iv)(II).  On remand, of course, the FDA will  have the opportunity to explain why it fails to meet them.


18
Second, it is unclear that a triggering "court decision" need  explicitly hold the patent at issue is "invalid" or is "not  infringed" in order to trigger the 180-day period of market  exclusivity.  Both the FDA and the Federal Circuit recognize  that a certification that a patent is "unenforceable" suffices  for purposes of the Paragraph IV certification, see 21 C.F.R.  § 314.94(a)(12)(i)(A)(4);  Merck & Co. v. Danbury Pharmacal,  Inc., 694 F. Supp. 1, 2-3 (D. Del. 1988), aff'd, 873 F.2d 1418  (Fed. Cir. 1989), even though the statute provides that such  certification must state that the patent is "invalid" or "will not  be infringed," see 21 U.S.C. § 355(j)(2)(A)(vii)(IV).  When it  promulgated the final regulations on ANDA applications, the  FDA explained that it included "unenforceability" because  "[t]he alternative interpretation, precluding applicants challenging patents as unenforceable from filing certifications  under paragraph IV, would be contrary to Congress' obvious  intent in allowing patent challenges under [ANDA] and would  lead to absurd results."  59 Fed. Reg. 50,338, 50,339 (1994).Likewise reflecting the same concerns, see id. at 50,353, the  FDA regulations provide that a "court decision" need not hold  the patent is "invalid" or "not infringed" but alternatively may hold the patent unenforceable, see 21 C.F.R.  § 314.107(c)(1)(ii) (Westlaw 1999).


19
Intervenors' attempt to assert that unenforceability, which  is included in the regulation, and estoppel, which is presented  here, should be treated differently under § 355(j)(5)(B)(iv)(II)  is unpersuasive.  Although it is true that a determination of  unenforceability, such as for inequitable conduct, applies generally, preventing the patent holder from enforcing the patent  against any entity, see Elk Corp. of Dallas v. GAF Bldg.  Materials Corp., 168 F.3d 28, 30, 32 (Fed. Cir. 1999), and the  estoppel arising from the California dismissal operates only  against Syntex as to Teva, see generally 18 Charles Alan  Wright et al., Federal Practice and Procedure § 4443, at  381-91 (1981);  see also Cotton v. Heyman, 63 F.3d 1115, 1119  (D.C. Cir. 1995), this appears to be a distinction without  difference for purposes of the "court-decision" requirement. To start, or trigger, the period of market exclusivity by a  "court decision," an ANDA applicant need only obtain a  judgment that has the effect of rendering the patent invalid  or not infringed with respect to itself;  the statute does not  require, nor does any party contend that it requires, the  patent to be invalidated as to any and all ANDA applicants. See 21 U.S.C. § 355(j)(5)(B)(iv)(II).  As the FDA and Tor Pharm concede, Syntex cannot sue Teva for patent infringement as a result of the California dismissal.  In its regulations, the FDA added "unenforceability" to the list of what  qualifies as a "court decision" because it concluded that  implementing the statute in any other way would be contrary  to Congress' intent and produce absurd results.  See 59 Fed.  Reg. at 50,353 (referring to 59 Fed. Reg. at 50, 339).  However, the situation presented here appears no less absurd  because Teva can never be sued by Syntex for patent infringement, but the FDA has nevertheless concluded that the  California dismissal cannot satisfy the "court decision" requirement of the statute.  Thus, the FDA's application of the  statute to this case runs counter to its explanation for permitting unenforceability to qualify as a "court decision."


20
Third, the FDA's treatment of the California dismissal  appears contrary to the FDA's "Guidance for Industry" in two respects.  Cf. Cherokee Nation of Okla. v. Babbitt, 117  F.3d 1489, 1499 (D.C. Cir. 1997) ("An agency is required to  follow its own regulations.")  First, the FDA has effectively  declined to proceed on a "case-by-case basis," proposing  instead to consider Teva's interpretation as part of the rulemaking process.  Although the FDA generally has discretion  to determine whether to proceed by adjudication or rulemaking, see Mobil Oil Exploration & Producing Southeast Inc. v.  United Distribution Cos., 498 U.S. 211, 230 (1991);  SEC v.  Chenery Corp., 332 U.S. 194, 203 (1947);  Arkansas Power &  Light Co. v ICC, 725 F.2d 716, 723 (D.C. Cir. 1984), litigants  also have a right to adjudication of their claims, see AT&T v.  FCC, 978 F.2d 727, 731-33 (D.C. Cir. 1992).  The FDA has  been mute in response to Teva's request for a complete  explanation of the rejection of its interpretation.  Noting the  language of the statute, its purposes, and ambiguities, the  FDA has recognized in its brief to this court, as the court in  Mova did, see 140 F.3d at 1073 n.18, that a dismissal could be  sufficient to satisfy the "court decision" requirement.  See  Federal Appellee's Br. at 20-21.  Yet, the FDA says in its  brief that it is "not at this time prepared to conclude that  dismissal of Teva's declaratory judgment action for lack of  subject matter jurisdiction is a 'decision of a court' under  section 355(j)(5)(B)(iv)(II)."  Id. at 20.  Contrary to the  FDA's view, nothing in our decision in Purepac, 162 F.3d  1201, relieved the FDA of its obligation to abide by the  commitments it made in the "Guidance for Industry" as to  how it would proceed until a new rulemaking was completed.


21
How the FDA can justify this approach to Teva's interpretation of the California dismissal in light of its treatment of  other cases remains a mystery;  presumably in a "case-bycase" analysis the FDA is obligated to explain such differences.  See ANR Pipeline Co. v. FERC, 71 F.3d 897, 901  (D.C. Cir. 1995);  Pontchartrain Broad. Co. v. FCC, 15 F.3d  183, 185 (D.C. Cir. 1994).  Specifically, the FDA has not  explained why it would recognize a grant of partial summary  judgment, based on the patent holder's admission of noninfringement, as a "court decision" in Granutec, 1998 WL  153410, at *5, but decline to give similar effect to a dismissal based on a finding of no reasonable apprehension of suit  arising from the patent holder's admission of noninfringement.  In Granutec, the FDA argued that the partial  grant of summary judgment in a prior case satisfied the  "court decision" requirement.  See id.;  see also Glaxo, Inc. v.  Boehringer Ingelheim Corp., 954 F.Supp. 469 (D. Conn.1996),  final judgment entered, 962 F. Supp. 295 (D. Conn.1997),  aff'd, 119 F.3d 14 (Fed. Cir. 1997) (unpublished opinion).That Boehringer involved a judgment on the merits, while  Teva's complaint was dismissed for lack of subject-matter  jurisdiction, does not detract from the fact that both proceedings prevent the patent holder from suing the ANDA applicant for patent infringement.  Given that the California dismissal supports estoppel to the same extent as the grant of  partial summary judgment at issue in Granutec, it is unclear  why the California dismissal would not satisfy the "court  decision" requirement of § 355(j)(5)(B)(iv)(II).  At least the  FDA has not provided an explanation wherein there is a  material difference for purposes of triggering the "court  decision" provision.


22
Second, the FDA's response to Teva's interpretation of the  "court decision" requirement is not easily viewed as "regulat[ing] directly from the statute," as the FDA committed to  do in its "Guidance for Industry."  The FDA "acknowledges  that its current interpretation of the court decision trigger is  narrower than the statute may be able to support....  [and]  that Teva's interpretation of the court decision trigger may be  permissible."  Yet if the FDA's interpretation of section  355(j)(5)(B)(iv)(II) is "narrower than the statute [is] able to  support," then its interpretation cannot stand without justification because the FDA must interpret the statute to avoid  absurd results and further congressional intent.  See Robinson v. Shell Oil Co., 519 U.S. 337, 346 (1997);  R.G. Johnson  Co. v. Apfel, 172 F.3d 890, 895 (D.C. Cir. 1999).  A narrow  interpretation cannot be reasonable simply because it is narrower than it could be;  to the contrary that interpretation  may in fact be narrower than it should be given the purposes  of the statutory scheme and congressional intent.  See Process Gas Consumers Group v. United States Dep't of Agriculture, 694 F.2d 778, 792 (D.C. Cir. 1982) (in banc);  see  generally Oil, Chemical & Atomic Workers Int'l Union v.  NLRB, 46 F.3d 82, 90 (D.C. Cir. 1995);  Association of  Civilian Technicians v. FLRA, 22 F.3d 1150, 1153 (D.C. Cir.  1994).  It is the narrowness of the interpretation that must be  justified, and the court can only review that choice of narrowness based on the reasons provided by the FDA, see Chenery,  332 U.S. at 196;  here, it has provided none.


23
As a result of the FDA's current construction of the "court  decision" requirement and its treatment of Teva's application,  generic ticlopidine tablets were not available in the marketplace for a number of months despite the fact that appellants  both stood ready to market them.  Syntex remained the  exclusive manufacturer of "Ticlid," and the first ANDA applicant's market exclusivity period had not begun because the  FDA had yet to approve that applicant's filing.  On July 1,  1999, the FDA finally approved TorPharm's ANDA, and  TorPharm commenced marketing on July 6, so now at least  one generic version of ticlopidine tablets is available.8  Yet,  this series of events may well not have been what Congress  contemplated in enacting the Hatch-Waxman amendents to  expedite generic drug approvals.  See H.R. Rep. No. 98-857,  pt. 1, at 14-15, reprinted in 1984 U.S.C.C.A.N. 2647, 2647-48;  cf. Mova, 140 F.3d at 1073.  Be that as it may, our decision to  reverse the denial of injunctive relief rests on the FDA's  failure to explain adequately its refusal to treat the California  dismissal as a triggering "court decision" under  § 355(j)(5)(B)(iv)(II), particularly in view of its announcement  in its "Guidance for Industry" of how it would proceed  pending a new rulemaking.  Although the FDA is likely correct that Teva's interpretation is not the only permissible  construction of the "court decision" requirement, Teva has  demonstrated that the FDA's refusal to treat the California  dismissal as a trigger was arbitrary and capricious in light of  the FDA's response in another case.


24
Accordingly, we reverse, and because our conclusion could  well affect the district court's evaluation of appellants' other  arguments concerning harm, injury, and the public interest,  we remand the case to the district court to consider anew the  request for injunctive relief.



Notes:


1
  Purepac has joined in the argument presented in the brief  filed by Teva, having been unsuccessful in a previous challenge to  the FDA's interpretation of the ANDA statute in Purepac Pharmaceutical Co. v. Friedman, 162 F.3d 1201 (D.C. Cir. 1998). Purepac  now seeks reversal of the district court's denial of injunctive relief  and a remand for entry of an order directing the FDA to make all  approved ANDAs for generic ticlopidine products, including Purepac's, effective as of February 10, 1999. Teva seeks a similar remedy:  reversal and remand, with the district court ordering the  FDA to make Teva's ANDA effective as of February 10th.


2
  Syntex (U.S.A.), Inc., the holder of Patent No. 4,591,592  (" '592 patent" or "patent") that covers a finished dosage formulation of a ticlopidine tablet, but not the active pharmaceutical ingredient ticlopidine hydrochloride, and Hoffmann-LaRoche Laboratories Inc., which markets ticlopidine tablets under the brand-name  "Ticlid," are two of the intervenors.  For ease of reference we refer  to Syntex and Hoffmann-LaRoche collectively as "Syntex."  Also  intervening is TorPharm, which has identified itself as the first  applicant to file its ANDA.


3
  As interpreted by the FDA, the statute does not guarantee  the first ANDA applicant a 180-day period of exclusivity.  The  court-decision trigger can be activated by any subsequent ANDA  applicant's litigation whether or not the first applicant has enjoyed  a period of exclusivity.  See Guidance for Industry:  180-Day Generic Drug Exclusivity Under the Hatch-Waxman Amendments to  the Federal Food, Drug and Cosmetic Act 5 (June 1998).


4
  Syntex had previously sued Teva and others for possible  infringement of its process patent for ticlopidine, but voluntarily  dismissed its complaint against Teva without prejudice once Teva  revealed its process.  That litigation was unrelated to the formulation patent at issue in the declaratory judgment action.


5
  See Purepac, 162 F.3d at 1205 n.6;  Mova, 140 F.3d at 1073 &  n.18.


6
  See Mova, 140 F.3d at 1066 (outlining standard for preliminary injunctions).


7
  See also 5A Charles Alan Wright & Arthur R. Miller,  Federal Practice and Procedure § 1350, at 225 (2d ed. 1990).


8
  The FDA's approval of TorPharm's ANDA does not moot this  appeal because Teva sought a preliminary injunction against the  FDA compelling it to deem Teva's application effective as of February 10, 1999.  Though Teva will be able to market its ticlopidine  tablet 180 days after July 6 without fail, in the interim Teva and  Purepac face continued harm because of their denied access to the  market, see Byrd v. EPA, 174 F.3d 239, 244 (D.C. Cir. 1999), harm  potentially heightened because of Tor Pharm's period of market  exclusivity.


