Novartis Vaccines and Diagnostics Inc. v. MedImmune LLC et al
Filing
171
MEMORANDUM ORDER denying 20 MOTION to Dismiss Based upon Improper Joinder. Signed by Judge Sue L. Robinson on 8/2/2012. (nmfn)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
NOVARTIS VACCINES & DIAGNOSTICS,
INC.,
Plaintiff,
v.
MEDIMMUNE, LLC,
BIOGEN IDEC, INC., and
ALEXION PHARMACEUTICALS, INC.,
Defendants.
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) Civ. No. 11-084-SLR
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MEMORANDUM ORDER
At Wilmington
this~day of August,
2012, having reviewed defendant Alexion
Pharmaceuticals, Inc.'s ("Aiexion's") motion to dismiss based on improper joinder and
the papers submitted therewith;
IT IS ORDERED that said motion (D.I. 20) is denied, for the reasons that follow:
1. Background. On January 26, 2011, Novartis Vaccines & Diagnostics, Inc.
("plaintiff') filed a complaint against Alexion, Medlmmune, LLC ("Medlmmune") and
Biogen Idee, Inc. ("Biogen") (collectively, "defendants") alleging infringement of U.S.
Patent No. 5,688,688 ("the '688 patent"), entitled "Vector for Expression of a
Polypeptide in a Mammalian Cell." (D. I. 1) Defendants separately answered the
complaint on July 6, 2011, asserting several affirmative defenses as well as
counterclaims seeking declaratory judgment of non infringement and invalidity of the
'688 patent. (D. I. 14, 17, 19) Medlmmune additionally seeks declaratory judgment of
unenforceability of the '688 patent. (D.I. 14) Also on July 6, 2011, Alexion filed a
motion to dismiss based on improper joinder, which is currently pending before the
court. (D.I. 20) On July 22, 2011, plaintiff filed an amended complaint, asserting for the
first time defendants' use of a commercial gene expression system manufactured by
non-party Lonza Group AG ("Lonza"). (D. I. 27) Defendants answered the amended
complaint on August 8, 2011, maintaining their original affirmative defenses and
counterclaims. (D.I. 37 -39) Plaintiff then filed a "first supplemental complaint to the first
amended complaint" on July 18, 2012, adding, inter alia, Novartis Pharma AG as a
plaintiff. 1 (D.I. 161)
2. Claim 1 of the '688 patent, reproduced below, describes a vector for
expression of proteins (or "polypeptides") in mammalian cells.
1. A vector for expression of a polypeptide in a mammalian cell
comprising a first polynucleotide sequence that comprises:
a) an upstream SV40 origin of replication;
b) a downstream SV40 polyadenylation region; and
c) a transcription regulatory region from human
cytomegalovirus immediate early region HCMV IE1, wherein
the transcription regulatory region includes the first HCMV
IE1 intron proximal to the 3' end of the HCMV IE1 promoter,
is interposed between the SV40 origin of replication and the
SV40 polyadenylation region, and is capable of directing the
transcription of a polypeptide coding sequence operably
linked downstream from the transcription regulatory region. 2
('688 patent at col. 75:43-56) In preparation for producing protein using the claimed
1
This court entered a scheduling order on August 2, 2010 setting a deadline of
July 15, 2012 for joining other parties and filing amended pleadings. (D.I. 36 at 1J3)
Defendants have not yet filed answers to this second amended complaint.
2
Plaintiff asserts that claim 1 of the '688 patent contains four elements, the
fourth of which is a "polypeptide coding sequence encoding a heterologous polypeptide
operably linked downstream of the transcription regulatory region" but the court finds no
such requirement in claim 1. (D.I. 32 at 4)
2
vector, a polypeptide coding sequence is inserted into the vector so that the coding
sequence is under the control of the transcription regulatory region. (/d. at col. 12:4-6)
This personalized vector is then introduced into a host such as a mammalian cell, which
replicates and functions as a protein production "factory." (/d. at col. 12:11-16; 0.1. 32
at 4) The resulting protein is then isolated and may subsequently be used in a wide
variety of applications, for example, the generation of monoclonal antibodies. ('688
patent at col. 13:62-65)
3. Lonza manufactures and sells a commercial gene expression system, the
Lonza GS Expression System™, which allegedly contains the same expression vector
claimed in the '688 patent. (0.1. 27
at~
15) Plaintiff asserts that Medlmmune, Biogen
and Alexion use the expression vector associated with the Lonza GS Expression
System to manufacture the humanized antibodies Synagis®, Tysabri® and Soliris®,
respectively. (/d. at 3-7) The expression vectors used by defendants purportedly differ
only with respect to the polypeptide coding sequence, which varies depending on which
protein is selected for production. (0.1. 32 at 5) Plaintiff maintains that this difference is
irrelevant to the question of infringement because the '688 patent accommodates any
polypeptide coding sequence so long as it is derived from a source other than the
human cytomegalovirus genome. (/d.) Put another way, plaintiff does not claim that
defendants' manufacturing processes and products are identical; rather, plaintiff claims
that defendants use the Lonza GS Expression System™ vector as a common step in
what may otherwise be divergent manufacturing processes. (0.1. 32 at 2)
4. Standard. Federal Rule of Civil Procedure 20(a)(2) allows for the joinder of
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defendants if:
(A) any right to relief is asserted against them jointly, severally, or in
the alternative with respect to or arising out of the same transaction,
occurrence or series of transactions or occurrences; and
(B) any question of law or fact common to all defendants will arise in
the action.
In patent infringement cases, "motions to sever are governed by Federal Circuit law" as
is the issue of proper joinder. In re EMC Corp., 677 F.3d 1351, 1356 (Fed. Cir. 2012)
("joinder in patent cases is based on an analysis of the accused acts of infringement,
and this issue involves substantive issues unique to patent law"). 3 Under Federal
Circuit law, "independent defendants satisfy the transaction-or-occurrence test of Rule
20 when there is a logical relationship between the separate causes of action." /d. at
1358; see also Moore v. N.Y. Cotton Exch., 270 U.S. 593, 610 (1926) (holding that two
claims arise from the same "transaction" when there is a "logical relationship" between
them). However, "joinder is not appropriate where different products or processes are
involved," and even "the sameness of the accused products or processes is not
sufficient." In re EMC Corp., 677 F.3d at 1359. Rather, "the defendants' allegedly
infringing acts, which give rise to the individual claims of infringement, must share an
aggregate of operative facts." /d. at 1358 (emphasis in original).
5. To determine whether there is a shared aggregate of operative facts, the
Federal Circuit urges consideration of the following factors: "[1] whether the alleged
acts of infringement occurred during the same time period, [2] the existence of some
3
In re EMC Corp. governs cases which were filed prior to enactment of the
Leahy-Smith America Invents Act, which codified a new set of rules governing the
joinder of parties in civil actions "arising under any Act of Congress relating to patents."
35 U.S.C. § 299.
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relationship among defendants, [3] the use of identically sourced components, [4]
licensing or technology agreements between the defendants, [5] overlap of the
products' or processes' development and manufacture, and [6] whether the case
involves a claim for lost profits." /d. at 1359. Ultimately, "[t]he district court enjoys
considerable discretion in weighing the relevant factors." /d.
6. Same transaction or occurrence. The first question at bar is whether
defendants' actions arise out of the same transaction, occurrence or series of actions or
occurrences by virtue of sharing an aggregate of operative facts. One relevant factor in
this analysis is whether there is overlap in the development and manufacture of the
product or process. See In re EMC Corp., 677 F.3d at 1359. Alexion argues that "each
of [d]efendants' accused products are made by different manufacturing processes and
result in different drug products." (D. I. 35 at 2) Alexion relies heavily on a recent case
from the Southern District of California in which the court held that "alleging a common
manufacturer and infringement of the same patent is not enough to support joinder
where defendants are unrelated companies, selling different products." Sorenson v.
OMS Holdings, Inc., Civ. No. 08-559, 2010 WL 4909615, at *1 (S.D. Cal. Nov. 24,
201 0). In Sorenson, the products at issue were entirely manufactured by a non-party,
offshore company and were merely sold by defendant. /d. Here, although the
expression vector is manufactured by Lanza, it is allegedly subsequently modified and
incorporated into defendants' own manufacturing processes via insertion into a
mammalian cell line. (D.I. 32 at 4) Therefore, there is necessarily some degree of
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overlap in defendants' manufacturing processes, 4 even if the overlap exists only during
"the first of many steps in manufacturing a monoclonal antibody." (0.1. 35 at 3)
7. Another factor in the "shared aggregate of operative facts" analysis is whether
defendants use identically sourced components. See In re EMC Corp., 677 F.3d at
1359. Each defendant allegedly obtained the expression vector from Lonza and used it
as a tool for producing antibodies. (0.1. 27
at~~
16, 21, 26) Therefore, the expression
vector is an "identically sourced" component used by defendants in their respective
manufacturing processes.
8. Together, these factors compel the finding that a logical relationship exists
between the causes of action for each defendant. While defendants' only relationship
is their common engagement in the research, development, manufacture and sale of
pharmaceutical products (0.1. 38 at
~
5; 0.1. 37
at~
3; 0.1. 39
at~
4), the absence of
any tangible business or legal relationship is just one of several considerations when
determining whether defendants' actions are part of the same transaction, occurrence,
or series of transactions or occurrences. See In re EMC Corp., 677 F.3d at 1358.
9. Common question of law or fact. The second issue at bar is whether any
question of law or fact common to all defendants will arise in the action. Alexion
asserts that "[t]he questions to be determined by the trier of fact will concern issues of
infringement and damages that are unique to each defendant" and "each accused
product." (0.1. 21 at 6) However, plaintiffs allegation of patent infringement will require
4
Alexion's assertion - that defendants' manufacturing processes may differ due
to the possibility of spontaneous mutagenesis of the vector once it is inserted into and
maintained in a cell line- is not a persuasive one. (0.1. 35 at 4)
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the court to hold Markman hearings and construe the asserted claims. Moreover,
defendants each assert invalidity defenses which will require the court to consider the
validityoftheasserted patent. (D.I.14, 17, 19) Forthesakeofefficiencyand
conservation of judicial resources, the court declines to construe claims and determine
the issue of validity separately for each defendant. See SRI Intern, Inc. v. Internet
Security Systems, Inc., Civ. No. 04-1199, 2005 WL 851126, at *4 (D. Del. Apr. 13,
2005) (permitting joinder to avoid duplicitous claim construction and determination of
"the date of conception and reduction to practice, the relevance of prior art and the level
of ordinary skill in the art" when defendants each asserted invalidity defenses).
10. With respect to prejudice to defendant, Alexion raises the concern that it will
be forced to disclose sensitive business information to its co-defendants, who are
potential competitors. (D. I. 21 at 7) However, the parties have since addressed this
concern by agreeing upon a protective order mandating that "highly confidential" and
"confidential" disclosures may not be used "for competitive purposes, research,
development, manufacture or regulatory purposes, Citizen's Petitions, other litigation, or
the prosecution of intellectual property rights." (D.I. 104
at~
5) See Helicos
Biosciences Corp. v. Pacific Biosciences of California, Civ. No. 10-735, 2011 WL
6758481, at *3 (D. Del. Dec. 22, 2011) (finding no prejudice when the parties agreed to
a protective order and a prosecution bar). Finally, because it appears that the
investigation into defendants' manufacturing processes will largely be directed at
common questions surrounding incorporation of the accused vector, the court finds,
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based on the limited information available at this stage in the proceedings, that the
scientific questions are not so radically different as to merit a finding of prejudice. 5
11. Conclusion. For the aforementioned reasons, the court denies Alexion's
motion to dismiss for improper joinder.
United Stat
5
D1stnct Judge
The court may revisit the issue of separate trials at the final pre-trial conference
when the record is more complete, as argued by defendant Alexion (D.I. 35 at 7),
defendant Biogen (D. I. 26) and proposed in the alternative by plaintiff (D. I. 32 at 12).
See MyMail, Ltd. v. America Online, Inc., 223 F.R.D. 455, 457 (E.D. Tex., 2004) (finding
joinder proper under Rule 20 but concluding "[w]hen discovery is complete, the Court,
upon motion of a party, will determine whether the state of the evidence compels
severance of some type under Rule 21 ").
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