Bristol-Myers Squibb Company et al v. Aurobindo Pharma USA Inc.
MEMORANDUM ORDER re dispute regarding venue-related discovery. Signed by Judge Leonard P. Stark on 11/28/17. Associated Cases: 1:17-cv-00374-LPS, 1:17-cv-00379-LPS (ntl)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
BRISTOL-MYERS SQUIBB COMPANY and
C.A. No. 17-374-LPS
AUROBINDO PHARMA USA INC.,
BRISTOL-MYERS SQUIBB COMPANY and
C.A. No. 17-379-LPS
MYLAN PHARMACEUTICALS INC.,
Pending before the Court are the parties' disputes as to how the venue-related
discovery previously ordered by the Court (see, e.g., C.A. No. 17-379 D.I. 36, 37) is to occur.
Having heard argument on November 15 (see C.A. No. 17-374 D.I. 40 (hereinafter, "Transcript"
or "Tr.")), and having considered the parties' subsequently-filed joint status report (C.A. No. 17374 D.I. 39) ("Report"), IT IS HEREBY ORDERED that, for reasons to be explained below:
The parties' agreed-upon steps - (i) Defendant Mylan Pharmaceuticals Inc.
("MPI") will serve supplemental declaration(s) addressing venue-related
topics (see Report at 1, 4 ~ 1, 5 ~ 1), including MPI' s relationship with any
parent, subsidiary, and affiliated entity, and (ii) the parties will, by
December 8, submit a proposed form of protective order- are ADOPTED.
MPI's supplemental declaration(s) shall be served no later than December
15, 2017. The Court agrees with MPI that this is a reasonable deadline.
On the remaining disputes - as to the scope and timing of discovery, and
when the parties should present additional future disputes to the Court Plaintiffs' Bristol-Myers Squibb Company and Pfizer Inc.'s ("Plaintiffs")
proposals (Report at 5-7 ifif 2-7) are ADOPTED, subject only to the
following brief extensions of some of Plaintiffs' proposed deadlines:
(i) to the extent MPI objects to the scope of discovery requests
served by Plaintiffs, it shall serve objections no later than January
12, 2018, on which the parties shall meet and confer by January 19,
and the parties shall present any unresolved, ripe disputes to the
Court (pursuant to the Discovery Matters procedures) no later than
(ii) subject to objections, MPI shall provide complete substantive
responses to the written discovery by January 31; and
(iii) venue-related discovery shall be completed by the later of
March 15 or 45 days after resolution of disputes presented to the
Court in accordance with this Order.
The Court has made these determinations based on its finding that Plaintiffs'
overall proposal is more reasonable, persuasive, and consistent with the Court's prior rulings and
guidance, than is MPI' s proposal. For instance, MPI appears to expect Plaintiffs to accept all
representations in its forthcoming declaration(s) without the necessity of follow-up beyond
·interrogatories (see Report at 2-3), but the Court has already stated that "[P]laintiffs are going to
have to be given some limited chance to take discovery sufficient to test whatever it is they're
being told by the defendant" (see Tr. at 39), which will include (if Plaintiffs wish) depositions.
Also, MPI complains that "Plaintiffs offer no legal basis for how any Mylan entity's submission
of any document to the Delaware state government ... could establish venue of MPI" (Report at
3), but, as Plaintiffs observe, these submissions "would include forms with addresses and
property tax records," which may be "probative of whether a Mylan entity exercises control over
a physical place ofbusiiless in Delaware" (id. at 8 n.3). Nor does the Court agree with MPI's
that the Report mostly reveals "largely undisputed aspects of the procedural
schedule" (Report at 4) or that Plaintiffs' proposal is "expansive" and will "unnecessarily
prolong the dispute and tax the resources of the Court and the parties" (id.). Instead, it is the
Court's view that MPI has raised important, unsettled, novel questions as to whether this District
is a proper venue for this Hatch-Waxman patent litigation, and Plaintiffs have made reasonable
proposals to obtain the discovery necessary to allow the parties, and the Court, to answer these
questions, without disturbing the overall progress of this case (or the many related cases) .1
Furthermore, as Plaintiffs correctly state, "[t]o the extent the parties disagree about a specific
request after good-faith negotiations to refine it, the Discovery Matters procedure remains
available for MPI to seek relief." (Report at 9)
There are presently at least 20 related cases pending in this District. Trial is scheduled
for October 2019. (See C.A. No. 17-374 D.I. at 22 if 21)
The Court pastes below certain pertinent portions of the guidance it previously
provided the parties, in connection with its denial of MPI' s earlier request that the Court deny the
entirety of Plaintiffs' request for any venue discovery. (C.A. No. 17-379 D.I. 45 at 3) The Court
stated the following at the conclusion of the November 15 teleconference:
. . . I view the dispute in front of me today as actually a pretty
narrow one. MPI's request is that I ... outright den[y] ... the
venue discovery that I had ordered in my earlier opinion [C.A. No.
17-379 D.I. 36], which was [issued] pre-Cray[2 ] and that the
plaintiffs now seek. That request, that is, to outright deny all venue
discovery, that request is denied.
I don't believe that plaintiffs are engaged in a fishing
expedition. . . . . And I don't think that the decision in Cray
makes the theories of venue being articulated by plaintiffs frivolous
and, therefore, I don't believe that some targeted limited amount of
discovery would be futile ....
. . . I think it is important that today is a discovery dispute.
I don't view myself today as being tasked with deciding on the
merits whether MPI has a regular and established place of business
in Delaware as that term has been explained by Cray. I also do not
view myself as being faced with the task today of deciding if MPI
has met its burden to show that it lacks a regular and established
place of business here. And I'm also not, today, in a position to
articulate with full precision exactly what the impact of Cray is on
the facts here as they may be. That's a process, as I'm sure you
will appreciate, I'm actively engaged in in this case and others in
examining and reexamining Cray and trying to figure out how it
does apply, for instance, here. Here, I remain of the view that at
least some limited discovery is necessary in order for me to make
that final application of Cray and the statute [28 U.S.C. § 1400] fo
the facts here.
I continue to believe that discovery may reveal that MPI
does have a regular and established place of business in Delaware
and that venue would therefore be proper here. When I look at the
declarations submitted to this point, ... they do not address
ln re Cray Inc., 871F.3d1355 (Fed. Cir. 2017).
whether or not any of the affiliates, subsidiaries, parents, potential
alter egos, that is, the other entities in the Mylan corporate family,
[including] Delaware subsidiaries ofMPI, ... have a regular and
established place of business in Delaware.
In my view, Cray does not address whether a physical place
of a corporate affiliate or subsidiary or alter ego or agent can, for
venue purposes, be attributed to the named defendant in a case ....
And I have not heard yet any persuasive reason to conclude the law
has changed on that point.[ 3] I'm not even sure that MPI is arguing
that the law has changed on that point.
. . . MPI seems to acknowledge that at least an alter ego or
a sham entity, if that were what the record ultimately showed,
would allow the place of business of ... that sham entity to be
attributed to the named defendant for purposes of assessing regular
and established place of business for purposes of determining
proper venue. The point being that the legal theory that I think
motivates the plaintiffs' allegations of venue do [es] not constitute a
theory that I can say at this point that Cray even addressed, much
less eliminated or rendered invalid or inapplicable. So the Court
can't say that plaintiffs' allegations regarding the potential contacts
of those other corporate entities in the Mylan family are frivolous.
. . . . Cray, instead, considers whether a physical place of a
defendant's employee can be treated as a physical place of a named
defendant. That's a different question than the question before me
I think Cray says that what happens at the place of an
employee can still be considered for evaluating whether or not the
named defendant has a place. For instance, Cray talks (I think
positively) about Cordis[ 4 ] and ... the employee in Cordis: what
he was doing in his home with respect to, for instance, the
defendant[' s] literature and products. And Cray seems to say that
even post-Cray, Cordis is good law and that that [the] Cordis
employee's place in the district could be treated as the named
See, e.g., Minn. Min. & Mfg. Co. v. Eco Chem, Inc., 757 F.2d 1256, 1265 (Fed. Cir.
1985) ("[V]enue in a patent infringement case [may be] proper with regard to one corporation by
virtue of the acts of another, intimately connected, corporation.").
1n re Cordis Corp., 769 F.2d 733, 737 (Fed. Cir. 1985).
defendant's place[,] or at least that place of the employee could be
considered as a relevant factor in determining whether the named
defendant has a place.
But even putting that aside, I think as importantly, the
question of whether you can consider the physical place of a
defendant's employee as part of the analysis of whether or not the
named defendant has a physical place is a different question than
whether you could treat the physical place of a corporate affiliate,
corporate subsidiary, corporate parent, [or] corporate alter ego as
the physical place of the named defendant. ..-. [I]t seems to me
that Cray gives a couple ofreasons for why the employee's place
may in some circumstances not be attributable [to] or treated as
part of the named defendant's place; reasons that don't seem, at
least on the surface, to apply to the question in front of me today.
For instance, Cray talks about [how] an employee can
change jobs and therefore it would seem odd, at least in some
cases, to treat the employee's home as the place of the defendant.
But the types of entities that are alleged to be part of the Mylan
family[,] and therefore affiliates in some way ofMPI[,] I don't
think could as easily terminate their affiliation with MPI. It seems
easier to imagine an employee going to another employer than say
a subsidiary of MPI suddenly not being a subsidiary of MPI. So
that might be a meaningful distinction.
And, second, Cray talks about [how] the employee's home
is often not established or ratified by the defendant. I'm not sure
that that will often be the case with respect to a corporate
subsidiary or corporate affiliate's place. That is, the facts here may
show that the corporate subsidiary or corporate affiliate' s place is
established or ratified by the named defendant ....
MPI emphasizes repeatedly that the record in [its] view
already establishes that there is no relationship between any of the
other related entities and the ANDA at issue in this case. I have
not yet been pointed to where Cray or any other case at least from
the Court of Appeals tells me that such a relationship is required in
order for venue to be appropriate.
. . . . Also important to my decision, and I think
undisputed, is Cray repeatedly [states] that regular and established
place ofbusiness issues are fact specific. That favors ... in a .
difficult case granting some discovery ... , in order to allow the
Court to make a fact specific decision on a full record ....
(Tr. at 33~39) (internal punctuation and paragraph spacing added)
The Court adheres to and adopts the statements recorded in the transcript above,
which have informed the Court's rulings on the disputes addressed in this Memorandum Order.
November 28, 2017
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