Cellectis S.A. v. Precision Biosciences Inc.
Filing
15
MEMORANDUM OPINION. Signed by Judge Sue L. Robinson on 8/6/2012. Associated Cases: 1:11-cv-00890-SLR, 1:12-cv-00204-SLR(nmfn)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
CELLECTIS S.A.,
Plaintiff,
v.
PRECISION BIOSCIENCES, INC.
Defendant.
CELLECTIS S.A.,
Plaintiff,
V.
PRECISION BIOSCIENCES, INC.
Defendant.
)
)
)
)
)
)
)
)
)
Civ. No. 11-890-SLR
)
)
)
)
)
)
)
)
)
Civ. No. 12-204-SLR
Chad M. Shandler, Esquire and Travis S. Hunter, Esquire of Richards, Layton & Finger
LLP. Counsel for Plaintiff. Of Counsel: Richard L. Delucia, Esquire, Paul M. Richter,
Jr., Esquire, and Anne Elise Herold Li, Esquire of Kenyon & Kenyon LLP.
Richard L. Horwitz, Esquire and David E. Moore, Esquire of Potter Anderson & Corroon
LLP, Counsel for Defendant. Of Counsel: Robert J. Morris, Esquire and Francisco J.
Benzoni, Esquire of Smith Anderson Blount Dorsett Mitchell & Jernigan LLP; E.
Anthony Figg, Esquire, C. Nichole Gifford, Esquire and Sharon E. Crane, Ph.D.,
Esquire of Rothwell, Figg, Ernst & Manbeck, P.C.
MEMORANDUM OPINION
Dated: August 6, 2012
Wilmington, Delaware
~~udge
I. INTRODUCTION
These are related declaratory judgment actions brought by plaintiff Cellectis S.A.
("Cellectis") against Precision Biosciences Inc. ("Precision"), in which Cellectis seeks a
judgment of patent invalidity and noninfringement with respect to Precision's U.S.
Patent Nos. 8,021,867 ("the '867 patent") (Civ. No. 11-890), 8,119,361 ("the '361
patent") and 8,119,381 ("the '381 patent") (Civ. No. 12-204). Precision
contemporaneously filed suits against Cellectis in the United States District Court for
the Eastern District of North Carolina alleging infringement of these patents. Pending
before the court are various motions filed by the parties. Precision moves to stay Civ.
No. 11-890 pending a determination by the United States District Court for the Eastern
District of North Carolina regarding the applicability of the first-filed rule. (D.I. 7)
Precision has filed a similar motion in Civ. No. 12-204 (D.I. 21), in which case Cellectis
has also filed several motions for leave to file amended complaints (D. I. 18, D.l. 20, D. I.
28). The court has jurisdiction to hear these motions pursuant to 28 U.S.C. ยง 1338.
II. BACKGROUND
The litigation history between these parties is extensive and may be summarized
by a series of races to the courthouse on nearly a dozen patents. 1 On September 26,
2011, Precision filed a complaint for patent infringement against Cellectis in the United
States District Court for the Eastern District of North Carolina (hereinafter, North
Carolina 1//), alleging infringement of the '867 patent. (E.D.N.C. Civ. No. 11-513, D.l. 1)
1
Prior litigation between the parties has been described in the court's concurrent
opinion in Civ. No. 11-173-SLR, which the court incorporates by reference. The court
focuses here only on those facts pertinent to the motions at bar.
On September 30, 2011, Cellectis filed the complaint for declaratory judgment in Civ.
No. 11-890 seeking judgment of invalidity and noninfringement of the '867 patent. (Civ.
No. 11-890, D.l. 1) By its motion dated February 13, 2012, Precision asks this court to
stay Civ. No. 11-890 pending a determination by Judge Malcolm J. Howard in North
Carolina Ill as to whether (and how) to apply the first-filed rule to this dispute. (/d., D. I.
7) On March 16, 2012, Cellectis moved to stay North Carolina Ill pending the resolution
of a combined motion to dismiss Cellectis from several actions in that districe for lack of
personal jurisdiction. (E. D. N.C. Civ. No. 11-513, D. I. 23, D. I. 24)
In the first few minutes of February 12, 2012, Precision filed two suits in the
United States District Court for the Eastern District of North Carolina alleging that
Cellectis infringes Precision's '361 and '381 patents. 3 (E.D.N.C. Civ. Nos. 12-76 & 1277 (hereinafter, "North Carolina IV & V," respectively)) Thereafter on February 21,
2012, Cellectis filed a declaratory judgment suit in this court seeking judgment of
invalidity and noninfringement of the '361 and '381 patents. (Civ. No. 12-204, D.l. 1)
Cellectis filed an amended complaint on February 28, 2012 adding Precision's U.S.
Patent No. 8,124,369 ("the '369 patent") to that case (Civ. No. 12-204). (/d. D.l. 6)
Second and third amended complaints were filed on March 6 and 13, 2012,
respectively, adding claims relating to Precision's U.S. Patent Nos. 8, 129,134 ("the '134
2
E.D.N.C. Civ. Nos. 11-513, 12-76, 12-77, 12-96, 12-112 and 12-124. (E.D.N.C.
Civ. No. 11-513, D.l. 24 at iii) The motion to dismiss in North Carolina Ill was filed after
the motion to stay, on May 11, 2012. (E. D. N.C. Civ. No. 11-513, D.l. 48) Precision
amended its complaint in that action on June 1, 2012 (id., D.l. 61); Cellectis has filed a
consent motion to apply its combined motion to dismiss to the amended complaint (id.,
D.l. 64).
3
The suits were filed at 12:06 a.m. and 12:12 a.m., respectively.
2
patent") and 8,133,697 ("the '697 patent"). (/d., D.l. 10; D.l. 13) Prior to Precision's
answer (or entry of appearance), Cellectis thereafter filed a motion for leave to file a
fourth amended complaint on March 27, 2012. (!d., D. I. 18) Therein, Cellectis sought
to add claims relating to newly-issued U.S. Patent Nos. 8,143,015 ("the '015 patent")
and 8,143,016 ("the '016 patent") to this suit. 4 (/d. at 3) On Apri13, 2012, Cellectis
moved for leave to file a fifth amended complaint, adding proposed claims regarding
U.S. Patent No. 8,148,098 ("the '098 patent"), issued that same day by the PTO. (D.I.
20 at 3) On each day Cellectis moved to amend the complaint in Civ. No. 12-204,
Precision filed infringement actions in North Carolina on the '369, '134, '697, '015, '016,
and '098 patents. (E.D.N.C. Civ. Nos. 12-98, 12-112, 12-124, 12-160, 12-161 & 12174)
On April 3, 2012, Precision filed a motion requesting that this court stay the Civ.
No. 12-204 pending a determination by the United States District Court for the Eastern
District of North Carolina in parallel litigation as to whether (and how) to apply the firstfiled rule to this dispute. (/d., D. I. 21) On April24, 2012, Precision filed suit in North
Carolina for infringement of its newly-issued U.S. Patent No.8, 163,514 ("the '514
patent") (E.D.N.C. Civ. No. 12-219); Cellectis filed a motion for leave to file a sixth
amended complaint adding claims relating to the '514 patent in Civ. No. 12-204 that
same day (D. I. 28 at 3).
4
Cellectis stated that its amended complaints were filed on each day the PTO
issued the aforementioned patents. (D. I. 18 at 3)
3
Ill. STANDARD
The Federal Circuit prefers "to apply in patent cases the general rule whereby
the forum of the first-filed case is favored, unless considerations of judicial and litigant
economy and the just and effective disposition of disputes, require otherwise."
Genentech, Inc. v. Eli Lilly and Co., 998 F.2d 931, 937 (Fed. Cir. 1993), rev'd on other
grounds, Wilton v. Seven Falls Co., 515 U.S. 277 (1995). If applied, the rule counsels
that a later-filed action involving the same controversy should be dismissed, transferred
or stayed in favor of the first-filed action. See id. at 938; accord E. E. 0. C. v. Univ. of
Pa., 850 F.2d 969, 976-79 (3d Cir. 1988) ("[c]ourts must be presented with exceptional
circumstances before exercising their discretion to depart from the first-filed rule").
"[D]istrict courts, typically the ones where declaratory judgment actions are filed,
as occurred in the present controversy, will have to decide whether to keep the case or
decline to hear it in favor of the other forum, most likely where the infringement action is
filed." Micron Tech., Inc. v. Mosaid Techs., Inc., 518 F.3d 897, 904 (Fed. Cir. 2008)
(emphasis added).
IV. DISCUSSION
A. Applicability of the First-Filed Rule
The court has two questions before it: (1) whether the first-filed rule applies;
and, if so, (2) whether to proceed to evaluate whether any exceptions to the rule apply.
1. Civ. No. 11-890 and North Carolina Ill
As to the first question, there is no dispute that Civ. No. 11-890 and North
Carolina Ill involve the same parties and the same issues (infringement and validity of
4
the '867 patent). Cellectis argues that the first-filed rule should not apply in the first
instance because the North Carolina courts lack jurisdiction over Cellectis. (Civ. No.
11-890, D. I. 10 at 6-7) (citing Tuff Torq Corp. v. Hydro-Gear Ltd. Partnership, 882 F.
Supp. 359 (D. Del. 1994)) In Tuff Torq, this court denied defendants' motion to transfer
the case to the United States District Court for the District of Iowa, where first-filed
litigation was pending, since: (1) there was no dispute that jurisdiction did not exist in
Iowa with respect to two defendants; 5 (2) defendants failed to demonstrate that the
balance of convenience strongly favored transfer; and (3) the Delaware litigation was on
track to proceed to resolution prior to the first-filed Iowa action. 882 F. Supp. at 362-64.
The court concurrently denied defendants' motion to stay, stating that "[a] recognized
reason to depart from [the first-filed] rule exists when the second filed case has
developed more rapidly than the first." /d. at 364-65. The court also noted that "it is
fundamentally unfair to stay litigation that has proceeded further than another
previously filed litigation, particularly when in that previously filed action [plaintiff] is not
even a party or seemingly subject to personal jurisdiction." /d. at 365.
Cellectis is a French company that maintains its principal place of business in
Paris, France. (Civ. No. 11-890, D.l. 1 at~ 1) Cellectis has, however, previously sued
Precision in North Carolina and, as the court previously noted, Cellectis "should not
oppose litigating in a court in which it previously litigated without complaint." (/d., D.l.
5
The Iowa action was initiated by a defendant (Sauer, Inc.) that was incorporated
in Delaware and had its principal place of business in Iowa. Tuff Torq, 882 F. Supp. at
360-61. A motion was filed in Iowa to add (as declaratory judgment plaintiffs) the two
defendants referenced here. /d.
5
134 at 17) 6 Indeed, Cellectis's prior litigation supports the exercise of general personal
jurisdiction over it in North Carolina. See Avocent Huntsville Corp. v. Aten Intern. Co.,
Ltd., 552 F.3d 1324, 1334 (Fed. Cir. 2008), cert. denied, 129 S. Ct. 2796 (2009) ("[W]e .
. . have found jurisdiction where such 'other activities' in some identifiable way 'relate to'
enforcement of th[e] patents in the forum."); Campbell Pet Co. v. Miale, 542 F.3d 879,
885-86 (Fed. Cir. 2008). To put the point another way, it is not evident that the North
Carolina court lacks personal jurisdiction and, therefore, the North Carolina court should
make that determination in the first instance as the first-filed court.
2. Civ. No. 12-204 and North Carolina IV & V
In opposing Precision's motion for a stay in Civ. No. 12-204, Cellectis again
relies on Tuff Torq in emphasizing that the North Carolina court's lack of jurisdiction
over it renders the first-to-file rule irrelevant. (Civ. No. 12-204, D.l. 26 at 13-15) For the
reasons articulated above, the court concludes that the first-filed rule is applicable to
the mirror-image cases involving the '361 and '381 patents.
B. Determination Regarding Exceptions
Having concluded that the first-filed rule applies, the remaining issue before the
court on Precision's motion is whether a stay must be entered to allow the North
Carolina court to effectuate the rule; i.e. to determine whether exceptions to the firstfiled rule apply. The court answers in the affirmative. See Micron Tech., 518 F.3d at
904; Genentech, Inc. v. GlaxoSmithKiine LLC, Civ. No. 5:10-cv-4255, 2012 WL
4923954, *3-4 (N.D. Cal. Dec. 1, 201 0).
6
Cel/ectis S.A. v. Precision Biosciences, Inc., Civ. No. 11-173,- F.3d -, 2012
WL 1556489, *9 (D. Del. May 3, 2012).
6
In sum, the parties' conduct has become unseemly; it is likely that both will
continue to initiate suits (or move to amend pleadings) in both jurisdictions. The firstfiled rule was designed to address situations such as this, in order to "avoid burden[s
on] the federal judiciary" and prevent inconsistency. Indeed, its application to this
litigation will bring some order to the process. See E.E.O.C., 850 F.2d at at 977
(citation omitted). Therefore, the court stays the instant ligation and defers the
remainder of the analysis (i.e., the determination of whether any exceptions to the rule
may apply) to the North Carolina court.
B. Motions to Amend
Precision opposes Cellectis's second through sixth amended complaints in Civ.
No. 12-204. Precision argues that Cellectis's second and third amended complaints
are not properly before the court because Cellectis failed to obtain prior leave of court
to file them as required by Federal Rule of Civil Procedure 15(a). (Civ. No. 12-204, D. I.
22 at 3-4; D.l. 24 at 10) Precision opposes Cellectis's motions for leave to file its fourth
through sixth amended complaints on the basis that the patents at issue therein are the
subject of earlier-filed North Carolina litigations. (Civ. No. 12-204, D. I. 24 at 12-14; D. I.
25 at 14-15; D.l. 31 at 18-19) Precision stresses that it would be "highly prejudicial" to it
as "a small start-up company" to be required to litigate the same issues against
Cellectis that are already pending in another federal court in an earlier-filed action. (/d.,
D.l. 24 at 11-12; D.l. 25 at 16; D.l. 31 at 18-19)
At this juncture, the court notes that Cellectis's counsel's declaration states that
the PTO's website was monitored on the date of issuance of the '369, '134, '697, '015,
'016 and '098 patents; in each case, the PTO published the patent images at
7
approximately 5:00a.m. (D.I. 27, ex. 1 at 1f1f 3-7) Cellectis apparently made the
strategic decision that, insofar as it could not trump Precision's earlier filings in North
Carolina, Cellectis would add the related, later-issuing patents to Civ. No. 12-204 via
amended complaints rather than filing new complaints, avoiding first-to-file
complications.
The court agrees with Precision that, because the amended complaints purport
to add patents that issued after the original complaint was filed, Federal Rule of Civil
Procedure 15(d) controls the inquiry. See Masimo Corp. v. Philips Electronics North
Am. Corp., Civ. No. 09-80, 2012 WL 1609899, *2-3 (D. Del. Apr. 20, 2010) (treating
defendant's Rule 15(a) motion to amend counterclaims to assert a newly-acquired
patent as a Rule 15(d) motion); Aten Intern. Co., Ltd. v. Emine Tech. Co., Ltd., Civ. No.
09-843, 2010 WL 1462110, at *3-5 (C.D. Cal. Apr. 12, 2010) (analyzing motion to
amend, adding two later-issued patents, under Rule 15(d)). Under Rule 15(d), "[o]n
motion and reasonable notice, the court may, on just terms, permit a party to serve a
supplemental pleading setting out any transaction, occurrence, or event that happened
after the date of the pleading to be supplemented." Fed. R. Civ. P. 15(d) (2012). Under
either Rule 15(a) or 15(d), leave should be "freely given" "[i]n the absence of any
apparent or declared reason- such as undue delay, bad faith or dilatory motive on the
part of the movant, repeated failure to cure deficiencies by amendments previously
allowed, undue prejudice to the opposing party by virtue of allowance of the
amendment, futility of amendment, etc." Aten, 2010 WL 1462110 at *3 (quoting Foman
v. Davis, 371 U.S. 178, 182 (1962)) (additional citation omitted).
In this case, Cellectis' first through third amended complaints were filed within 21
8
days of the original complaint- the time period in which Rule 15(a) permits a party to
amend its pleadings as a matter of course. See Fed. R. Civ. Pro. 15(a) (2012).
Cellectis's motions for leave to file the fourth through sixth amended complaints were
each filed on the date each new patent issued (and on which Precision sued it in North
Carolina). There is no indication of undue delay by Cellectis, nor any particular
evidence of bad faith. See, gen., Cellectis, 2012 WL 1556489 at *9.
Precision filed its motion to stay between Cellectis's last two motions in lieu of an
answer, and a schedule has not been entered by the court (containing, inter alia, a final
date for amended pleadings). While Precision states that maintaining concurrent suits
will affect financial hardship upon it, the court notes that there is insufficient evidence of
record that any prejudice Precision may suffer would be "undue."
Notably, the '369, '134, '697, '015, '016, '098 and '514 patents are all related
patents involving the same technology. Each claims priority to the '867 patent asserted
in the original complaint in Civ. No. 11-890, 7 and the patents also share a common
specification. "[T]here is substantial authority for allowing supplemental pleadings
where the new infringement claims relate to the same technology or to new patents
containing similar claims as those in the original patent." 8 See Lamoureux v.
AnazaoHea/th Corp., 669 F. Supp. 2d 227, 237 n.12 (D. Conn. 2009) (collecting cases).
7
The '361 and '381 patents asserted in Civ. No. 12-204 were filed as continuing
applications claiming priority to the '867 patent. It is unclear why Cellectis added the
newly-issued patents to Civ. No. 12-204 ('361 and '381 patents at issue) rather than
Civ. No. 11-890 ('867 patent at issue).
8
The court does not reach Cellectis's argument that the newly-added claims
"relate back" to the original filing date by virtue of their relation to the originally-pled
patents.
9
For the aforementioned reasons, the court grants Cellectis's motions to amend.
V. CONCLUSION
For the aforementioned reasons, Precision's motion to stay Civ. No. 11-890
pending a determination by the United States District Court for the Eastern District of
North Carolina regarding the applicability of the first-filed rule is granted. (D.I. 7)
Precision's parallel motion to stay Civ. No. 12-204 (D.I. 21) is also granted. Cellectis's
motions for leave to file amended complaints in Civ. No. 12-204 are granted. (D. I. 18,
D. I. 20, D. I. 28). An appropriate order shall issue.
10
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?