Sanofi et al v. Lupin Atlantis Holdings SA et al

Filing 170

MEMORANDUM ORDER Denying 156 MOTION to Dismiss for Lack of Subject Matter Jurisdiction. Signed by Judge Richard G. Andrews on 1/26/2017. (nms)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
SANOFI, et al.,
Plaintiffs,
Civil Action No. 15-415-RGA

v.

LUPIN ATLANTIS HOLDINGS SA, et al.,
Defendants.

MEMORANDUM ORDER

Defendant Sandoz, having exhausted legitimate means to seek a postponement of a trial
scheduled for April 24, 2017 (D.I. 23), now seeks to dismiss the case against it for lack of subject
matter jurisdiction. (D.I. 156). Sandoz's view is that it should be able to decide when, if ever,
the trial takes place. For the reasons that follow, I DENY Sandoz's motion.
Sanofi owns various patents that it asserts covers its branded drug, Multaq. Some of them
were listed in the Orange Book, and, after Sandoz filed ANDA No. 205744 seeking FDA
approval to market a generic version of Multaq, Sanofi filed suit. The result was a trial in June
2016. I eventually found in favor Sanofi, and against Sandoz, on the '167 and '800 patents, and
on September 22, 2016, enjoined Sandoz from commercializing the proposed ANDA generic
before April 16, 2029. (No. 14-264-RGA, D.I. 336, iii! 14-15). Sandoz has appealed from that
judgment. (Id., D.I. 339).
Meanwhile, on August 18, 2015, Sanofi was issued another patent, the '900 patent, which
Sanofi listed in the Orange Book as covering Multaq. On December 23, 2015, Sanofi filed the
instant suit against Sandoz, asserting the '900 patent, which also expires on April 16, 2029. (No.

15-1207, D.I. 1, ~ 20). That case, along with similar cases against two other generics, is now
proceeding under the above caption.
Sandoz made a "Paragraph IV" certification in relation to the '900 patent on February 17,
2016. (D.I. 157, p. 4). On October 7, 2016, Sandoz and the other two defendants requested a
stay of this case pending resolution of the multiple appeals from the earlier trial. (D.I. 144). I
denied the request for a stay on October 14, 2016. (D.I. 150). On October 28, 2016, Sandoz
changed the Paragraph IV certification to a "Paragraph III" certification. (D.I. 159-1). On
December 8, 2016, the instant motion was filed.
The basis for Sandoz's motion is simple. A Paragraph IV certification creates subject
matter jurisdiction. A Paragraph III certification does not, because it represents that the generic
will not market its product before the relevant patents expire. Thus, the parties agree that, since
there was a Paragraph IV certification by Sandoz on the '900 patent, the Court has had subject
matter jurisdiction over the case against Sandoz. (D.I. 157, p. 7; D.I. 167, p. 2). Thus, I think the
precise issue raised here is whether a generic who has filed a Paragraph IV certification divests
the district court of jurisdiction by the mere act of converting the Paragraph IV certification to a
Paragraph III certification.
I see two arguments in the briefing that are germane and therefore need to be considered.
One is a purely legal statutory interpretation argument. What exactly is the basis for
subject matter jurisdiction in the first place? The other is a mootness argument. Under what
circumstances can the unilateral actions of one party divest a court of jurisdiction?
The statutory interpretation argument, as I understand it, is not entirely settled. See
Stephen R. Auten & Jane S. Berman, ANDA LITIGATION 149-74 (Kenneth L. Dorsney et al.
eds., 2"d ed. 2016) (discussing related topics). Nonetheless, I am not deprived of jurisdiction

under 35 U.S.C. § 271(e)(2) and 35 U.S.C. § 1338(a) because it is sufficient that the case was
initially certified under Paragraph IV. Cf Cephalon, Inc. v. Sandoz, Inc., 2012 WL 682045, at
*4-5 (D. Del. Mar. 1, 2012) (finding that the absence of a Paragraph IV certification does not, as
a matter of law, automatically deprive the court of subject matter jurisdiction under both 35
U.S.C. § 271(e)(2) and 28 U.S.C. § 2201). It also appears that 28 U.S.C. § 2201 may confer
jurisdiction. Cf id. at *5 ("[S]o long as there is an actual controversy, that is, there is a sufficient
allegation of immediacy and reality, the exercise of jurisdiction over such an action is within the
discretion of the district court." (internal quotations omitted)).
I do not think Sandoz's mootness argument has any merit.
The standard for deciding whether Sandoz's actions have mooted this case are
straightforward.
A case becomes moot when interim relief or events have eradicated the effects of a
defendant's act or omission, and there is no reasonable expectation that the alleged
violation will recur. In cases where a defendant voluntarily ceases the challenged practice,
it is necessary for the court to determine whether "there is no reasonable expectation that
the wrong will be repeated." As a result, '"a defendant claiming that its voluntary
compliance moots a case bears the formidable burden of showing that it is absolutely
clear the alleged wrongful behavior could not reasonably be expected to recur."'
Ferring B. V v. Watson Labs, Inc.-Fla., 764 F.3d 1382, 1391 (Fed. Cir. 2014) (citations

omitted).
First, the record makes clear that Sandoz's Paragraph III certification is a matter of
convenience and expedience on Sandoz's part. It is asserted, without contradiction, that
Sandoz's conversion to Paragraph III certification is "wholly revocable." (D.I. 164, p.l). Indeed,
Sandoz admits, "Of course Sandoz could, and very well might, convert its Paragraph III
certification back to a Paragraph IV at some future date under certain circumstances." (D.I. 167,
p. 5). In my opinion, this is essentially a concession that the case is not moot. Sandoz argues

that any generic that from the outset gives a Paragraph III certification could later change the
certification to Paragraph IV. (D.I. 167, p. 5). I assume this is true, but the difference is that the
statutory structure shows that there is no jurisdiction over an initial Paragraph III certifier,
whereas there is jurisdiction over an initial Paragraph IV certifier. The specific facts leading to
the finding that the case was moot in Ferring are not analogous here. See Ferring, 764 F.3d at
1388-91. Unlike in Ferring, Sanofi makes an adequately supported argument that Sandoz would
reconvert back to Paragraph IV. See id at 1391 ("Perring makes no argument that Apotex
would file an infringing ANDA in the future"). There is thus a "reasonable expectation that the
wrong will be repeated." Id Defendant has not met its "formidable burden of showing that it is
absolutely clear the alleged wrongful behavior could not reasonably be expected to recur." Id
Second, Sandoz cites exactly one case, AstraZeneca AB v. Anchen Pharms Inc., 2014
WL 2611488 (D.N.J. June 11, 2014), where a court had decided the instant issue in favor of the
generic. 1 In AstraZeneca, the court noted the argument that the generic was "free to change its
certification back to Paragraph IV at any time." Id at *5. The court's opinion recites no facts
that would indicate the likelihood in that case of there being a change back. Instead, the court
noted that the circumstances in an ANDA case were quite different from cases in other areas of
the law. Mootness is a fact-bound issue; therefore I do not see the decision in AstraZeneca as
being inconsistent with what I decide here, because the facts are significantly different.
Third, Sanofi relies upon the recent decision of another judge of this court in AstraZeneca

AB v. Aurobindo Pharma Ltd, Civ. Act. No. 14-664-GMS (D. Del. Sept. 15, 2016) (D.I. 359).

1

Sandoz cites stipulated dismissals in support of its argument. First, as a general rule, I
attribute no precedential or persuasive weight to stipulated dismissals. Second, under different
circumstances, a change from Paragraph IV certification to Paragraph III certification might raise
no specter of a later reversal.

Sandoz (commendably) brought this decision up in its Opening Brief, distinguishing it as being
raised on the eve of trial. I do not think there is a material difference between bringing the issue
up in the middle of expert discovery, as in this case, and right before trial, as in Aurobindo. 2 The
timing of the motion is merely a consideration in deciding whether "there is a reasonable
expectation that [the branded company] may well again at some future time be required to assert
its interest in the [patent-in-suit]." Id. at 2 n.3. 3 I believe the instant case is indistinguishable on
any meaningful basis from Aurobindo.
Thus, I will deny Sandoz's motion. (D.1. 156).
IT IS SO ORDERED this '2:0day of January 2017.

2

If changing from Paragraph IV to Paragraph III were all that was required to divest the
court of jurisdiction, presumably, assuming the generic were willing to pay some sanctions, it
could moot the case after completion of the trial but before issuance of the decision if it did not
like the way the trial had gone.
3

I do not agree with Sanofi that the appeal of the earlier trial and this lawsuit are
necessarily either both moot or both not moot. For example, even if this lawsuit were moot,
Sandoz could win on appeal, and subsequent events, such as its codefendants succeeding in
invalidating the '900 patent, would offer the probability of Sandoz being able to get FDA
approval and to launch its generic long before 2029. Of course, Sandoz's pursuit of the appeal is
compelling evidence of its desire to pursue launch of its generic product long before 2029.