Medicines Company v. Hospira Inc.

Filing 611

ORDER ADOPTING REPORT AND RECOMMENDATIONS re 592 (SEALED) REPORT AND RECOMMENDATIONS of Special Master- DENYING 526 Motion To Dismiss, Strike or Alternatively Bifurcate Defendants APP Pharmaceuticals, LLC and APP Pharmaceuticals, Inc.'s Allegations of Inequitable Conduct and Unclean Hands. Signed by Judge Eduardo C. Robreno on 10/6/2011. (lid)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
THE MEDICINES COMPANY,
Plaintiff,
v.
TEVA PARENTERAL MEDICINES,
INC., et al.,
Defendants.

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CIVIL ACTION
NO. 09-750-ER

O R D E R
AND NOW, this 6th day of October, 2011, upon
consideration of Special Master Vincent J. Poppiti’s Report and
Recommendation (doc. no. 592), Plaintiff’s Objections (doc. no.
600),1 and Defendants APP Pharmaceuticals’ Response to

1

Plaintiff’s objections fail to grasp the law of the
case doctrine. This doctrine “directs courts to refrain from redeciding issues that were resolved earlier in the litigation.”
Pub. Interest Research Grp. of New Jersey v. Magnesium Elektron,
Inc., 123 F.3d 111, 116 (3d Cir. 1997). As the Court has already
considered the same pleading at issue here under the same
standard, (doc. no. 494), this doctrine applies here. Indeed,
Plaintiff does not object to its application. There are,
however, three noted exceptions, deemed “extraordinary
circumstances,” that warrant reconsideration despite the law of
the case doctrine, they are as follows: “(1) new evidence is
available; (2) a supervening new law has been announced; or (3)
the earlier decision was clearly erroneous and would create
manifest injustice.” Id. at 116-17.
Plaintiff contends that the Court should dismiss or
strike Defendants’ counterclaim of inequitable conduct because it
does not meet the standard set forth Exergen Corp. v. Wal-Mart
Stores, Inc., 575 F.3d 1312 (Fed. Cir. 2009). Pl. Objections 1-

2. Even though the Court has already ruled on this issue,
Plaintiff argues that the counterclaim’s internal inconsistencies
cannot support an inference of deceptive intent, as required by
Exergen. Id. 2-3. Indeed, Plaintiff claims this argument
constitutes new evidence. Id. 3. Unfortunately for Plaintiff, a
new argument is not the same as new evidence. As Plaintiff
points out, all of the alleged inconsistencies are within
Defendants’ pleading. Id. 2. The Special Master’s Report and
Recommendation and this Court have previously assessed this
entire pleading’s sufficiency. See doc nos. 444, 494.
Therefore, the Court finds there is insufficient new evidence or
other exception to the law of the case doctrine to upset its
previous conclusions. Accordingly, Defendants’ have successfully
plead a claim of inequitable conduct.
Plaintiff also objects to the ruling on Defendants’
unclean hands defense. Again, Plaintiff misapplies the law of
the case exception of supervening law. Plaintiff relies first
upon In re Gabapentin, 649 F. Supp. 2d 340, 348 (D.N.J. 2009),
for the proposition that a court may not hold a patent
unenforceable based upon the doctrine of unclean hands. As
Plaintiff surely knows, a sister court’s decision is not binding
upon this Court and, therefore, does not constitute supervening
authority. Moreover, its reliance on Aptix Corp. v. Quickturn
Design Sys., Inc., 269 F.3d 1369, 1378 (Fed. Cir. 2001), is
similarly misplaced. Aptix did not squarely address the issue
before this Court, namely, Plaintiff’s alleged unclean hands
prior to litigation by placing the patent-in-suit in the Orange
Book. Indeed, Aptix involved alleged misconduct during the
litigation and accordingly found that the district court did not
properly limit relief to this misconduct. See id. at 1378.
To the extent that Aptix may be supervening, the Court
finds it is distinguishable from this case. Aptix dealt with the
specific litigation misconduct of presenting forged documents to
the court. Id. at 1372-74. In this case, Plaintiff’s alleged
misconduct was prior to litigation, that is, its listing in the
Orange Book of the patent-in-suit. Defs.’ Am. Answer and
Countercls. 39, ¶ 25-27. Thus, Plaintiff’s alleged fraud reaches
beyond the instant litigation. In fact, it reaches to the
jurisdiction basis of Plaintiff’s ability to sue because a
prerequisite to this ability is a proper filing in the Orange
Book. See 35 U.S.C. § 271(e)(2)(A); 21 U.S.C. §§ 355(b)(1),
(j)(2)(A)(vii); see also Andrx Pharms., Inc. v. Biovail Corp.,
276 F.3d 1368, 1371 (Fed. Cir. 2002). This distinction is
critical.
“The entire chain of Keystone cases also shows that the
relief for unclean hands targets specifically the misconduct,
without reference to the property right that is the subject of
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Plaintiff’s Objections (doc. no. 606),2 it is hereby ORDERED that
Special Master Vincent J. Poppiti’s Report and Recommendation
(doc. no. 592) is ADOPTED and APPROVED.

AND IT IS SO ORDERED.

S/Eduardo C. Robreno
EDUARDO C. ROBRENO, J.

the litigation.” Aptix, 269 F.3d at 1376 (Fed. Cir. 2001)
(emphasis added). The misconduct and the limited relief from
Aptix went hand-in-hand. As the misconduct here has a broader
sweep than the misconduct in Aptix, the relief must be
correspondingly broader. While it is true that Defendants’
counterclaim seeks unenforceablility of the ’727 patent, it also
seeks any other relief that the Court finds appropriate. See
Defs.’ First Am. Answer and Countercls. 40, at ¶ L. The Court is
unwilling at this time to dismiss or strike Defendants’
counterclaim of unclean hands without the opportunity to exercise
its equitable powers when fashioning the appropriate remedy. Cf.
Aptix, 269 F.3d at 1378 (concluding that district court properly
found unclear hands and properly dismissed suit, but limited
relief to dismissal).
Accordingly, the Court saves for another
day what the proper relief may be, should Defendants succeed on
their claim, but holds that Defendants have successfully plead a
counterclaim for unclean hands.
2

The Court also reviewed, again, Special Master Vincent
J. Poppiti’s Amended Report and Recommendation (doc. no. 444),
and letters from both Plaintiff and Defendants (doc. no. 607,
609).
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