Amgen Inc. v. F. Hoffmann-LaRoche LTD et al

Filing 161

Opposition re #153 MOTION to Strike Roche's Affirmative Defenses Nos. 2, 7, 8, 10 and 12 and in Support of Roche's Motion for Leave to Amend Its Answer and Counterclaims #160 filed by F. Hoffmann-LaRoche LTD, Roche Diagnostics GmbH, Hoffmann LaRoche Inc.. (Attachments: #1 Exhibit A#2 Exhibit B#3 Exhibit C#4 Exhibit D)(Toms, Keith)

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UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS Civil Action No. 05-12237-WGY ***************** * AMGEN, INC., * * Plaintiff, * * v. * * F. HOFFMANN-LA ROCHE LTD, * ROCHE DIAGNOSTICS GmbH and * HOFFMANN-LA ROCHE, INC., * * Defendants. * * *****************

MOTION HEARING

BEFORE:

The Honorable William G. Young, District Judge

APPEARANCES: DUANE MORRIS LLP (By Michael R. Gottfried, Esq.), 470 Atlantic Avenue, Suite 500, Boston, Massachusetts 02210 - and DAY CASEBEER MADRID & BATCHELDER LLP (By Lloyd R. Day, Jr., Esq. and Stuart Watt, Esq.) 20300 Stevens Creek Boulevard, Suite 400, Cupertino, California 95014, on behalf of the Plaintiff

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A P P E A R A N C E S (Cont'd) BROMBERG & SUNSTEIN LLP (By Lee Carl Bromberg, Esq.), 125 Summer Street, Boston, Massachusetts 02110 - and KAYE SCHOLER LLP (By Leora Ben-Ami, Esq. and Howard Suh, Esq.), 425 Park Avenue, New York, New York 10022, on behalf of the Defendants NUTTER, McCLENNEN & FISH LLP (By Daniel P. Olohan, Esq.), World Trade Center West, 155 Seaport Boulevard, Boston, Massachusetts 02210-2699 - and PATTERSON, BELKNAP, WEBB & TYLER LLP (By Steven A. Zalesin, Esq.), 1133 Avenue of the Americas, New York, New York 10036-6710, on behalf of Ortho Biotech Products, L.P.

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jurisdiction over the various people that they've sued. That's, that's the logic. So, I guess I want to turn first to Ortho. And would you develop first why Ortho is a necessary party. MR. ZALESIN: Certainly, your Honor. We're relying on a very recently decided case by the Federal Circuit, the Aspex Eyewear case. THE COURT: Right. I've looked at it. MR. ZALESIN: What the Federal Circuit says there is that for the same policy reasons that a patent holder must be joined as a party along with an exclusive licensee, the exclusive licensee wants to bring suit, the inverse of that should also be true that the exclusive licensee ought to be joined as a party along with the patent holder. THE COURT: Well, that's your inference. MR. ZALESIN: Well, those more or less are the words of the Federal Circuit, they say for the same policy reasons. I can read you the quote if it's helpful. THE COURT: But Aspex was an exclusive licensee at the proper time, then Chic was not a necessary party and Aspex was in fact a proper plaintiff. MR. ZALESIN: That's right. THE COURT: That's right. That's what they say. MR. ZALESIN: That's right. THE COURT: You take the negative implication of

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THE CLERK: Calling Civil Action 05-12237, Amgen -well, it isn't -THE COURT: It's the same action. THE CLERK: -- versus Ortho. THE COURT: It's the one involving Ortho. THE CLERK: Ortho. THE COURT: The motion to intervene. MR. ZALESIN: Yes. THE COURT: And on the motion to intervene would counsel identify themselves. MR. DAY: Yes, your Honor. Rusty Day, representing Amgen, and with me is Stuart Watt and Michael Gottfried. MR. ZALESIN: Good afternoon, your Honor. Steve Zalesin representing Ortho, and Dan Olohan. THE COURT: Thank you. MS. BEN-AMI: Your Honor, my name is Leora Ben-Ami and I represent Roche, along with Mr. Bromberg and Mr. Suh. THE COURT: Fine, and we'll get to you. MS. BEN-AMI: Thank you. THE COURT: The first round -- at least it makes sense to me that we ought to grapple with whether Ortho's in or out; then once we have figured out Ortho in and out, we can grapple with whether Amgen versus the LaRoche folks have subject matter jurisdiction first and then have personal

that. MR. ZALESIN: Well, your Honor, I think, I think they say more than that. Let me, let me get the quote that I have in mind. They say that, this is a quote from the Federal Circuit's opinion at Page 1344, "For the same policy reasons that a patentee must be joined in any lawsuit involving his or her patent there must be joinder of any exclusive licensee," unquote. That quote appears at Page, I was reading from Page 8 of our reply. And I think it was in our opening brief also. Now, they don't unpack that very much and they don't go back to what the policy is. But let me tell you what I understand it to be and how it affects us here. The issue is duplicative lawsuits. If the exclusive licensee were allowed to sue on its own then there would be a risk that the patent holder and the exclusive licensee could maintain separate actions, whether simultaneously or seriatim, against the same infringer and essentially get two bites at the apple or expose the infringer, or alleged infringer to multiple suits on the same accused product under the same patents because neither party, both have an interest in the patent and the right to sue -THE COURT: Yes. MR. ZALESIN: -- and neither party would be bound

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by the judgment against the other. THE COURT: I'm familiar with that. But that's, it's not clear to me, certainly Aspex doesn't stand, doesn't hold that Ortho in the circumstances of this case is a necessary party. MR. ZALESIN: Well -THE COURT: That's not the holding. MR. ZALESIN: I think what it holds is that whichever of the two as between the two ultimate exclusive licensees, Chic and Aspex, whichever one was the exclusive licensee as of the time the complaint was filed, and there's a discrepancy by a couple of days and they send it back for more fact finding, but whichever one of those two was the exclusive licensee was a necessary party in that case, and they can't tell on the record in front of them on appeal which one was the exclusive licensee at the time. THE COURT: And that's not this case. MR. ZALESIN: Right. THE COURT: Another interesting aspect of Aspex is that they don't in any way suggest they're making a significant shift in the law. MR. ZALESIN: I agree with your Honor. They just kind of say it matter of factly, that for the same policy reasons, et cetera. But, but if you go back to their logic and the issue is avoidance of multiplicity of suits, that
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agreement -- well, I'll be completely transparent and you can all argue to it. Absent the language of the license agreement, it looks to me like Ortho is certainly a proper party to be joined. Not, not a discretionary party, you're a proper party to be joined. Except that, except that under the license agreement it seems that you have given the right to control this lawsuit to Amgen. MR. ZALESIN: I see. THE COURT: And I haven't found a case, candidly, and we've looked, where if you have that right to, a right can be waived, and I read the language as waiving it. Now, that's why oral argument's helpful. That's how I come on the bench. I want to hear you. MR. ZALESIN: Okay. We're talking about the provision of the license agreement, I believe it's Paragraph 8.02, but we'll find it in a second, in which, it sort of carves up the responsibility as between Amgen and Ortho for what's supposed to happen when there's an alleged infringer. And it says that we're supposed to talk, we're supposed to consult about the best way to go forward. Whichever party discovers the infringement is supposed to share its evidence of infringement with the other party, and then it does allocate the initial responsibility to Amgen. None of the background happened in this case. I

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same logic would hold, I believe, in our case, that Ortho should not, Ortho shouldn't have the opportunity to sue on its own in a separate or follow-on lawsuit, and Roche shouldn't have to face the possibility of being sued by either Amgen or Ortho in a separate or seriatim lawsuit. But if we're together in the same suit, Roche is protected and as we, since we have standing, there's no reason why we shouldn't be here. That's, that's more the intervention issue. But I believe that the straightforward reading, and I agree with you it's rather curt, it's rather short and they don't want unpack it very much, but it does say right on its face, it is the Federal Circuit, they are the, more or less the controlling authority on patent issues. THE COURT: More rather than less. I understand. I work for them. MR. ZALESIN: There you go. THE COURT: But you see -- and now let's -- we'll slide over to -- I understand your argument and I understand the case with which you conjure. Let's talk about Rule 24 here. MR. ZALESIN: Yes. THE COURT: And where I would like you to, to begin is with your license agreement with Amgen. MR. ZALESIN: Yes. THE COURT: Because as I read the license

don't think that's disputed. Amgen went forward on its own. So they didn't comply with those provisions, but that's not necessarily of concern to your Honor. It may be some window in to why we don't necessarily feel that our interests are fully protected. But the case that I would direct you to, your Honor, is the Ferrofluidics case against Advanced Vacuum Components from the First Circuit in 1992. I'm sorry. I'm sorry. That's not the right case. I apologize. I had it flagged and -- I'm sorry, it's the Prima Tek case, Prima Tek II, LLC versus A-Roo Company, from the Federal Circuit in 2000, where the Court said, quote, "Standing to sue for infringement depends entirely on the putative plaintiff's proprietary interest in the patent, not on any contractual arrangements among the parties regarding who may sue and who will be bound by judgments." So, I think that the Federal Circuit has in effect said standing is a, is a matter of patent right which depends upon whether the party that seeks to sue, whether independently or together with the patent -THE COURT: Well, I'll go back and look at that case. MR. ZALESIN: Sure. Okay. THE COURT: But that case addresses standing. MR. ZALESIN: Right.

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THE COURT: And as I understand the patent laws and as I understand Federal Circuit jurisprudence, you can't -isn't that a case where they were saying you can't confer standing by contract. That makes perfect sense. That makes perfect sense. Because -MR. ZALESIN: Well -THE COURT: -- the whole concept of standing has constitutional overtones. MR. ZALESIN: Well -THE COURT: For my discussion, I was prepared, and still am, I think, to say that you are a proper party to be joined unless you gave that away in a contract. And it looks like you did. MR. ZALESIN: Well, first of all, standing to be conferred by contract because that's what the license agreement does, it creates the necessary exclusive license. A license agreement is a contract, it creates an exclusive license, it creates the protectable legal interests that Ortho has in the enforcement of the patent and makes us a proper party. I think the issue that your Honor is addressing is whether -THE COURT: That's right. MR. ZALESIN: -- in addition to that you should construe the contract in this setting to bar Ortho from

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in arbitration, not in this court. If they can show some damage to them from that, or want to seek an injunction in arbitration against our participation -THE COURT: Oh, really? MR. ZALESIN: -- they could go to arbitration and I don't -THE COURT: Then maybe I should just, since you people are so interested in arbitration, maybe I should say, well, you, that's the justice you want, you go figure it out, let the arbitrators tell me, I'll more or less confirm. Are you saying that? MR. ZALESIN: No, no, I'm not saying -- what I am saying is that the issue of whether Ortho has standing and is properly an intervenor in this case is an issue for your Honor to decide. THE COURT: That's what you want. MR. ZALESIN: That's what I -THE COURT: And I'm saying that may turn on contract. And you say, well, not you, Judge, not you, arbitrators. We want arbitrators to determine the contract. Well, fine. MR. ZALESIN: What I'm saying, your Honor, is that the issue for this Court we believe is whether Ortho has standing and we're a proper party. If, if we have somehow done harm to Amgen's rights under the contract then
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participating in a case where Amgen hasn't invited us to participate. THE COURT: But it looks pretty clear that's what you contracted for. MR. ZALESIN: I would say, I would say a couple of things to your Honor. First of all, if we are correct that we are a necessary party under Aspex -THE COURT: I don't have to worry about that. MR. ZALESIN: Okay. THE COURT: I agree. MR. ZALESIN: Second, I think Amgen has waived its right to rely upon that language by which it gets to choose whether to join us or not by failing to comply with the various contractual prerequisites which is not disputed on this record. They didn't contact us. They didn't discuss the issue with us, et cetera. Not disputed on this record. And, third, in any event, as Amgen points out in its brief, and I think it's applicable here, there is an arbitration clause in the contract and if Amgen is unhappy that Ortho is inserting itself into this case, a patent case, because Ortho has standing, and the Court is prepared to find we're a proper party, then the standing issues and the Rule 24 issues for this Court are satisfied. If Amgen thinks that we are in breach of the contract by forcing our way into a litigation where we don't belong, their remedy is

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there's -THE COURT: You've made the point. I'm going to stick to my time. Mr. Day, on this point, or whoever's going to argue. MR. DAY: I will, your Honor, for Amgen. I believe Roche may also want to say something and I'll try to leave time for Roche. I'll try not to take all the time. THE COURT: Oh. That's an interesting lineup. I hadn't thought I was going to hear Roche within this time. But if you -MR. DAY: I'm happy to take all the time, but they filed a paper and I didn't want to squeeze them out, your Honor. THE COURT: Fine. MS. BEN-AMI: He never wants to. THE COURT: Very well. Go ahead. MR. DAY: First of all, let me say with respect to necessary party, if I may. I recognize the Court wants to focus on the contract and I will get to the contract in a moment. THE COURT: But he's right, if they're a necessary party that trumps contract as far as I can see. MR. DAY: If they're a necessary party. Of course, if they're a necessary party, they were a necessary party in

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HMR/TKT, they never showed up. They were a necessary party in Amgen v. Chugai and they never showed up. THE COURT: I can't help that. My duty is to adjudicate the cases in front of me. MR. DAY: I understand that, your Honor. But as your Honor reminds us, the holding of a case is determined by its facts. And you need to look at the facts. And as your Court -- as your Honor astutely took us through Aspex, let's look at the facts. What was Aspex doing here. And in Aspex we're dealing with licensees who are exclusive licensees meaning that they have exclusive license rights under the patent. They don't have a license right to a product. They have exclusive rights under the patent. And the rights they were granted not only included the right to sell and the right to manufacture and the right to use, but the right to exclude. Now, Ortho has not been given those rights. Ortho has not been given the right to exclude. I'll just go there. And that's right where your Honor went. And you go to 8.02 in the contract. Because Ortho did not get the full bundle of rights under a patent, because they got a product license and not a patent license. And because they do not have the exclusive rights under the patent for any claim in the patent, they only have the right to sell a product, period. And they were not given the right to exclude. And

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exclude. The right to exclude others from making, the right to exclude others from selling, the right to exclude others from using. Ortho was given a right under that patent to sell, but it was not given the right to exclude. THE COURT: But suppose -- and I really must reflect on this because I wasn't prepared, my fault, for anyone to mention arbitration. Suppose I were to say, and I'm not suggesting I will, that on the issue of intervention -- well, the way I see it, I've got to wrestle my way through necessary party. So I do that. Let's say Ortho doesn't win on that, arguably. And then I say, gee, they look like a proper party to be joined under Rule 24, unless of course the contract precludes them. The contract says arbitrate, I'll stay my hand on this, say nothing further, let them do whatever they want. They don't get to arbitrate, but of course if they want an arbitration -- they don't get to intervene, but if they want an arbitration then -- again, I must manage the lawsuits that are before me but -MR. DAY: That's their prerogative. THE COURT: I understand. MR. DAY: If they choose to arbitrate that's their -THE COURT: You're okay with that? MR. DAY: Yes, sir.
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that was expressly bargained and negotiated between the parties. Because Amgen's rights are so much broader, Amgen's rights invoke so much more than Ortho was given. Amgen and Ortho bargained with each other as to who would have the right to enforce this patent. And the agreement was reached between them that Amgen would have the right. And if Amgen elected that right then Ortho, if it was invited, would agree to join. If it wasn't invited it wouldn't share in the costs and it wouldn't share in any damages. THE COURT: And it sounds like you agreed to arbitrate those issues. MR. DAY: Well, and then-THE COURT: If there's a dispute about that. MR. DAY: We agreed, your Honor, that the contract states what it states. And if there is a dispute the sole remedy for that dispute of any cause arising under the contract is arbitration. That's the only remedy for disputes in contract. And I think, I think, your Honor, at bottom, I've tried to work this through, you know, and I bottom out exactly where your Honor bottoms out. 8.02 is what controls here. Because 8.02 is the provision, you have to look at the agreement in its entirety and you have to understand that what a patent confers quintessentially, the quintessential right that a patent confers is the right to

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THE COURT: All right. I think I understand the arguments. Well, now, he defers -- you had your ten minutes. He defers to LaRoche here. I don't understand why LaRoche wants to be heard. MS. BEN-AMI: I only want to be heard about one point, your Honor, and that's this Aspex case. If your Honor looks at the next paragraph under joinder of -THE COURT: Beyond what I quoted? MS. BEN-AMI: I think in the second paragraph it says exclusive licensee with the right to sue. And so that, I think that is controlling. THE COURT: And your point is that here it's undisputed Ortho didn't have that right. MS. BEN-AMI: So there really is no necessary party. THE COURT: I'll take the matter under advisement. Thank you. Now, with the parties all in place let's -- yes. And thank you very much. I appreciate your courtesy. Let's turn to the issue first of subject matter jurisdiction. And my first question on that issue is for Mr. Day. You've carefully parsed your language here and I want to ask you straight out. Does Amgen claim there is, today, infringement of its patents here in the United

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States? MR. DAY: Yes, your Honor. What we claim is that 271(e)(1) is an affirmative defense and that we know that Roche is importing into the United States and using in the United States a product that infringes our patent. Our patents. And it is their affirmative defense that all of the use of that patent, all their use of that product, excuse me, is subject to their defense. Now, that then becomes -THE COURT: Their defense being this safe harbor for the regulatory -MR. DAY: 271(e)(1). THE COURT: -- approvals. MR. DAY: Yes. That the use of a product to obtain data for submission to FDA, any reasonably, any use reasonably related. THE COURT: Yes. MR. DAY: I'm not parsing over the scope. You know, I think the Court got it right in HMR. I think the Court fully understands what the scope of the defense is. But it's an affirmative defense. It's a defense that Roche must make out. And so, the contention is, yes, they are infringing today and there is no question that they intend to make commercial sale of this product in the future.
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THE COURT: But they haven't done that -- well, then, let me phrase it this way. That is a direct answer and I appreciate it. Why shouldn't I do what I did in the HMR case which was administratively close this until the regulatory agency approval has come out LaRoche's way -MR. DAY: Yes. THE COURT: -- and we have a real issue. MR. DAY: Yes. For two reasons. First of all, in HMR you held that we had a real issue. You held in HMR at the time that there was a real case or controversy. You exercised your discretion to stay. Now, second of all, so let's look at the facts. Let's look at the circumstances in which you did that and see are they analogous to this situation. You did that at a point in time before Roche had filed an application -before, excuse me, HMR had filed an application with FDA for approval to market and sell. And, in fact, as it turned out it was more than a year prior to the time, almost two years prior to the time that HMR had filed, got around to filing a regulatory application. And you determined at that point in time that the product was still subject to change, that the manufacturing process for the product was still subject to change. And for that reason you administratively stayed it. And you pointed out, albeit, I think, a little vaguely, but

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you pointed out that there may be a point in time prior to regulatory approval when the case should be reinstituted. THE COURT: Exactly. But your point here is, and I really want to hear about personal jurisdiction, so I'm going to cut you off, your point here is given the undisputed facts that are before this Court, we're much further down the process in terms of what you fear than we were with HMR. MR. DAY: And I would like to make just two additional points with respect to that. And the first one is if you look at the Glaxo case, which is the controlling Federal Circuit case here, the case that is closest on point, you will notice in the Glaxo case that the defendant in that case gave notice to Glaxo that they were intending to sell their product no sooner than 18 months before the lawsuit was filed. So they had filed an ANDA and they said they would not sell their product for at least 18 months. Nonetheless, the Federal Circuit held that there was sufficient imminence for a real case or controversy and the case went on. The second point I want to make, if I may. THE COURT: Very briefly. MR. DAY: And I appreciate your patience. The second point I want to make is that if not now, when? And that is the issue Roche has not answered. And
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all I can take from their papers is, well, after we're approved. In other words, they want to create a safe harbor for infringement. They want to prevent Amgen from getting an adjudication of its rights. THE COURT: But they do have a safe harbor, I thought, until, you say it's an affirmative defense, until, as we use a visual, until they sail out from that safe harbor. MR. DAY: And then they want, at that point in time they want to say and then the lawsuit can start. So that we can, we can infringe, we can sell, we can get into the market, we can effect irreparable harm because an adjudication is not going to occur in a day, it's not going to occur in two days. THE COURT: No. MR. DAY: And I think your Court -- I think your Honor recognized that in HMR. Because you pointed out in HMR that there is a point in time before market approval where it may be appropriate to institute suit. And I think Glaxo specifies when that is, your Honor. THE COURT: Thank you. Let me hear from LaRoche, on this point now, subject matter jurisdiction. And could I ask you to start where he started. He says, he posits it, and I can follow it, I'm not asking you

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to admit you infringe, he says they're infringing now, but they have this affirmative defense, which he then proceeds to argue ought not apply here. My question to you is, are you doing now, today, that of which they complain -- I'm characterizing it as infringing -- but for the fact of pending regulatory approval. MS. BEN-AMI: I think to answer your question, Roche is doing clinical trials. THE COURT: Yes. MS. BEN-AMI: That is what Roche is doing. THE COURT: So you are doing, you are doing the acts. MS. BEN-AMI: We are. THE COURT: But you say in complete good faith they're clinical trials. MS. BEN-AMI: And, your Honor, if you look at the complaint you will see that Amgen's complaint is, the only count in the complaint is for declaratory judgment. THE COURT: Oh, I've noted that. MS. BEN-AMI: There is no complaint for actual infringement. THE COURT: Right. And he agrees. MS. BEN-AMI: And so I think that is a red herring. There is only a complaint for future infringement.
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Declaratory judgment that when we come out of safe harbor there will be infringement, then we are squarely in the question of whether the Court can exercise declaratory judgment jurisdiction. THE COURT: But you see that gets me back, though you frame it as a question of subject matter jurisdiction, that gets me back, this is, this is a new case, new parties, I treat things new, but it gets me back into that area of the law that I wrestled with before. And you use this safe harbor analogy. You say we're here in the safe harbor. They may be patrolling offshore with their blockade, but we're in the safe harbor. And he says, no, no, no. At some stage they're, they're building their ships, they're arming then, and at some stage they're ready to come out, it's time for us to go into a cutting-out attack. I've been reading too much Patrick O'Brian recently. But do you see what I mean? MS. BEN-AMI: Yes. THE COURT: And though he complains that it's vague, I do the best I can. Somewhere there's a line there. He thinks you've crossed it. You say you haven't. I think I want to suggest to you I'm not, I'm not to be heard to say that the line is a bright-line regulatory approval. It does seem to me at some stage you're gearing up, you know, you're doing your clinical testing, which has to be done in the

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market, and I have to then grapple with are you infringing. That I suggest to you. MS. BEN-AMI: Well, I don't think it can be infringement under 271(e)(1). So it's really a question, again, I come back to is it ripe for declaratory judgment. And because it is, those acts are not an infringement, they should not be able to create an actual controversy. The real issue of actual controversy, rather than advisory opinion, is when there is an imminence of an actual infringement. And let's look at where we are. While Amgen put in a very carefully crafted declaration that said you get a response in ten months, that's just a response, if it happens. It could be a rejection. It could be an ask for more information, it could be anything. And the facts are, if you look at historical facts, when their Aranesp product was approved, when the Pegasys product was approved, they were both roughly about two years down the road. So, we're not looking at something happening in three months or six months. And I believe there was a shipping case, your Honor, the Lang case was about building a ship, and there the Court said nine months is too far away. So, I think that your Honor needs to consider, we are far down the road still. And there is a policy issue here that I would like

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your Honor to consider. In the situation of generics where there is an ANDA, and I know your Honor is familiar with this, congress has said when you file your approval papers that will create an artificial technical act of infringement, so there can be an infringement lawsuit prior to launch. Right? Congress spoke very clearly about that. And in 271(e)(1) they took a different position which said you are safe unless you're doing something other than for clinical, something reasonably related to go to the FDA. So there is a congressional split of intent to handle generics where they're copycats and they're just piggy-backing off of the other party's approval, versus a new ANDA or BLA. And I believe that congressional intent would be violated by saying once you file a BLA that's enough. If Roche were out there selling that would be a different situation. And in the TKT case, your Honor, you said, point blank, you, you have the authority at a certain point, if there's imminence, real imminence, like the product has been approved and people are about to ship it or something like that -THE COURT: And you agree with that at least theoretically. MS. BEN-AMI: In theory you have, you have the inherent and explicit authority just like in a regular non-pharmaceutical patent case. Imagine this as an

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electronics case. And Amgen has a patent on a DVD player and I want to start selling DVD players. And I didn't wait two years or three years or whatever it might be. They come into court, they sue us, they ask for a preliminary injunction, and your Honor deals with it under the facts and law. And this situation shouldn't put Roche at a worse position because it has to go through FDA approvals. THE COURT: But, I mean, you're hiring salespeople, you're building a manufacturing plant. That may be good business, but it certainly causes them disquiet. MS. BEN-AMI: Well, we're building a manufacturing plant outside the United States which will also possibly service outside the United States. And that's a very good point, the manufacturing plant. Because for biologics getting approval with manufacturing plants is very difficult. Your Honor may remember the situation where Chiron was stopped from making its vaccines, its flu vaccines, because of manufacturing plant issues. It's not a walk in the park to go ahead and do this. THE COURT: What about sales personnel? MS. BEN-AMI: Sales personnel are hired because they have to get doctors to work on the clinicals. The reality is that you have to get doctors to do clinical trials. And those are not acts of infringement, your Honor.

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import and sell in Massachusetts an infringing product. THE COURT: Now, again, I appreciate the answer. And to me it's a recognition on your part that just the data on the website's not going to be enough to establish jurisdiction, so you say let Amgen have the chance to back up that data. MR. DAY: In addition -THE COURT: And I guess I should posit just for the purposes of discussion that the data on the website is accurate. And you say if it is all accurate and it involves Massachusetts, as well as other states, you say you have jurisdiction under Roche Switzerland. Over Roche Switzerland. MR. DAY: Yes. THE COURT: More precisely, this Court does. MR. DAY: Yes. Now, let me add to that. Roche tells us in their reply papers that the Hoffman-LaRoche Limited that's listed on the website is actually an English company. It's a different company than the Swiss company. They don't provide us with any attestation, any declaration, any evidentiary support of that. And they leave us to guess what the internecine organizational structure and workings of all the various different Roche companies are and who's doing what where. And that's all the more reason, I

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THE COURT: Let's, let's turn to personal jurisdiction because I cannot, I cannot keep everything cabined here. I understand my duty to address subject matter jurisdiction. But let's address personal jurisdiction. And I do think I want to go back to Mr. Day and then I'll be back to you. Mr. Day, it looks to me that the stronger of your arguments on personal jurisdiction has to do with, and let me get it correct, Roche Germany, and the weaker of your arguments has to do with the other entity -MR. DAY: Roche Switzerland. THE COURT: -- Roche Switzerland, if we're all clear what we're talking about. And I think you recognize that. So you would like a little jurisdictional discovery. Let me assume, because I may be able to handle this as matter of law, that there are a number of license agreements such as you hope to discover. Would that change the analysis? Would you start there. MR. DAY: It would change the analysis if as I suspect and am led to believe by Roche's website, Roche Switzerland is a sponsor of the clinical trials in Massachusetts as well as elsewhere in the United States, or if Roche Switzerland is the sponsor of the BLA that has been filed because it would then be seeking approval to make,

believe, why a limited amount of discovery to simply find out, well, if it's not the Swiss company but it's really the British company that is the proper party here, and is the party that should be joined in this lawsuit, and they could easily tell us that today if they wish, or we could discover that through limited discovery, then fine, they're the proper party. I would also like to just simply point out that in addition to the clinical trials there is other activity ongoing. As the Court pointed out, not only the hiring of a sales force but the solicitation of customers to purchase Roche's product and/or to use Roche's products in a commercial setting. And the largest dialysis provider in the country happens to be a German company that is based here in Lexington, Fresinius. Their U.S. operation is based here. Are they contacted in Massachusetts or are they contacted in Switzerland or in Germany? I don't know. But the entity that appears to be the sponsor of the BLA and appears to be running the commercial organization of Roche is Roche Limited. THE COURT: All right. MR. DAY: And a little bit of discovery would ferret that out. THE COURT: Thank you. I'll hear LaRoche on the issue of personal jurisdiction.

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MS. BEN-AMI: Your Honor, Roche U.S. is the sponsor of the U.S. BLA. And there is no serious dispute about that. They're looking at a website and misreading it. And I think that in fairness to open up discovery of a Swiss company for harassment of huge amounts of discovery where it is clear that Roche U.S. is -THE COURT: Well, I wouldn't open it for huge amounts of discovery. How about -- would you undertake the burden of describing, I don't mean here this afternoon in open court, but among yourselves, the corporate arrangements and who's doing what? MS. BEN-AMI: I think that would be manageable. We could give the sponsor page, the page that says this is being sponsored by Roche U.S. to Mr. Day. THE COURT: All right. Now, I'm not asking you to concede in any way jurisdiction, but I find that helpful. Now, on personal jurisdiction what do you say? MS. BEN-AMI: As to Switzerland, your Honor, there are no continuous and systematic contacts, and they really do not have anything to do with this state. And it really does matter what state you're talking about. They're not in this state. They're not necessary to this case. So I'll focus on Germany, your Honor. The Germans are similarly not involved with Massachusetts. And we did tell the Court that they had,

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everything on ice but disadvantages no one because if the circumstances change and someone is disadvantaged a motion can be made to reopen the case telling me why the administrative closure hurts. Since I will not allow, at least the formal transaction costs of litigation, you can't serve interrogatories or take depositions or anything like that, your people are no worse off if I simply don't adjudicate it and administratively close the case if the corporate lineup as you sail out of the safe harbor is known at the time. MS. BEN-AMI: If your Honor closes all the motions and doesn't decide anything then we'll be -THE COURT: Well, my instinct is to decide what is ripe, I'm not saying I agree with you, because it's always more helpful to litigants to do the job they ask you to do than to duck them. And then as to those things that prudential value suggests I should at present duck, maybe I should duck. And everyone stays in their positions and, you know, the various commercial advantage and maybe you're discussing matters. So you're okay with that? MS. BEN-AMI: Except -- yes, your Honor, in general. Except that the issue of, the issue of whether there's sufficient contacts really should be decided at the time when the case is truly ripe.

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their predecessor company had purchased a cell line, but that is no longer the company. The company Roche has not made payments to Massachusetts since 2003. And it's important to think about that because it does tie into the motion to dismiss on subject matter jurisdiction. If this -- if Roche gets approved, and if it gets approved in two years, say, who knows what the contacts will be with this state in two years. It may be that there will be fewer contacts. There may be more contacts. And because this case is not ripe now, the Court should dismiss for personal jurisdiction now. And if there comes a point in time when the case is ripe, then the Court can look at the contacts as they exist at the time. Because right now the case is not ripe. And that the German company does not supply into Massachusetts for any infringing purpose, they do not do anything like that, they only provide to Roche U.S., in New Jersey, not in Massachusetts. They don't pay here. THE COURT: I follow a practice in a variety of situations, and I did it once this afternoon with the arbitration, of administratively closing cases. And that is an administrative closure. I think it's advantageous for the proper administration of this session of the Court and the maintenance of the Court's own statistics. It has the -- it's the functional equivalent of a stay. Puts

THE COURT: You've made that point. Now, I have one other point. As the -- and this is a case management point. Let's assume that I do not stay anything, or close it, and I thrash my way through, for good or ill. I let Ortho in, I keep Ortho out, I send Ortho to, and Amgen to arbitration. Of course, if I don't find personal jurisdiction over -- but that isn't going to happen because I have Roche U.S. MS. BEN-AMI: Correct, your Honor. THE COURT: So somebody in your team is going to be left standing, left present even if you win across the board on what you have argued here. Unless, and even if you win on what you said, subject matter jurisdiction, the most you're going to get is an administrative closure. So the case is alive. Now -- and I've got Roche U.S. If I don't administratively close the case and I've got Roche U.S., is this a jury case? MS. BEN-AMI: I don't know, your Honor. THE COURT: You don't know because we haven't reached it? MS. BEN-AMI: We haven't gotten that far yet. MR. DAY: As the claim is currently framed it's an equitable claim, it doesn't require a jury. There's no damage claim. THE COURT: I understand that. But they haven't

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yet responded because they've moved to dismiss. MR. DAY: That's right. THE COURT: And you're not making a response. And probably -- you know I like to get the business of the Court done -- probably it's premature to hold a case management conference until I know who's in and who's out and I know what claims are ripe. Because if I don't think anything's ripe we'll just put it on ice. And you're nodding. Would you give me your name again? MS. BEN-AMI: I'm sorry, your Honor. THE COURT: We're going to become very familiar with each other -MS. BEN-AMI: Yes, and I -THE COURT: -- and I like to call people by their names. MS. BEN-AMI: My first name is Leora, L E O R A. The last name is Ben-Ami, B E N A M I. THE COURT: Well, Ms. Ben-Ami, you're certainly welcome, and thank you. MS. BEN-AMI: Thank you, your Honor. THE COURT: And, Mr. Day, you agree with that construct, that it's a little premature to have a case management conference? MR. DAY: Yes, I don't agree you should get to that

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conclusion. But if you do get to that conclusion, I certainly agree with that. THE COURT: I understand your several positions. Thank you very much. It's been very helpful, and we'll recess. MS. BEN-AMI: Thank you, your Honor. THE CLERK: All rise. Court is in recess. (Whereupon the matter concluded.) CERTIFICATE I, Donald E. Womack, Official Court Reporter for the United States District Court for the District of Massachusetts, do hereby certify that the foregoing pages are a true and accurate transcription of my shorthand notes taken in the aforementioned matter to the best of my skill and ability.

_____________________________ DONALD E. WOMACK Official Court Reporter P.O. Box 51062 Boston, Massachusetts 02205-1062 [e-mail]

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