Momenta Pharmaceuticals, Inc. et al v. Amphastar Pharmaceuticals, Inc. et al

Filing 1009

Judge Nathaniel M. Gorton: ENDORSED ORDER entered. MEMORANDUM AND ORDERIn accordance with the foregoing, the evidence relative to the equitable defenses will be admissible at the impending jury trial. So ordered.(Caruso, Stephanie)

United States District Court
District of Massachusetts
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)
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)
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Plaintiffs,
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v.
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AMPHASTAR PHARMACEUTICALS, INC. )
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AND INTERNATIONAL MEDICATION
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SYSTEMS, LTD.,
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Defendants.
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MOMENTA PHARMACEUTICALS, INC.
AND SANDOZ INC.,

Civil Action No.
11-11681-NMG

MEMORANDUM & ORDER
Gorton, J.
In this case plaintiffs Momenta Pharmaceuticals, Inc. and
Sandoz Inc. (collectively, “Momenta” or “plaintiffs”) allege
that defendants Amphastar Pharmaceuticals, Inc. and
International Medication Systems, Ltd. (collectively,
“Amphastar” or “defendants”) infringed Momenta’s U.S. Patent No.
7,575,886 (“the ‘886 patent”).

This Court convened a status

conference on June 21, 2017, and took under advisement the issue
of the scope of the pending jury trial, i.e. the extent to which
Amphastar’s equitable defenses will be addressed at that trial.
Momenta asserts that the equitable defenses should be
addressed in a separate hearing after the trial because the
issues that the jury must decide, infringement, validity and
damages, are separate from the equitable defenses which examine
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whether there was a duty to disclose the ‘886 patent to the
United States Pharmacopeia (“the USP”) and whether Momenta
breached that duty.

Amphastar contends that there is

substantial commonality between the evidence of its defenses to
Momenta’s claims and the evidence of equitable defenses.
Because the Court agrees that there is a substantial overlap
rendering separation of the evidence problematic, the defendants
will be permitted to offer evidence relative to their equitable
defenses at the trial.
I.

Legal Standard
Equitable defenses involve matters of law and thus “factual

issues [underlying such defenses] ordinarily are not jury
questions.” Baxter Healthcare Corp. v. Spectramed, Inc., 49 F.3d
1575, 1584 (Fed. Cir. 1995).

Although the Federal Circuit Court

of Appeals (“Federal Circuit”) has stated that it is “not the
preferred course”, it upholds a district court’s decision to
“delegate aspects of the inequitable conduct inquiry to juries”
as long as such delegation does not result in prejudice or an
unfair trial. Rothman v. Target Corp., 556 F.3d 1310, 1322–23
(Fed. Cir. 2009).
Bifurcation is warranted if the claims and equitable
defenses "are distinct and without commonality either as claims
or in a relation to the underlying fact issues." DeKalb Genetics
Corp. v. Syngenta Seeds, Inc., 2008 WL 382385, at *2 (E.D. Mo.
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Feb. 12, 2008) (quoting Old Town Canoe Co. v. Confluence
Holdings Corp., 448 F.3d 1309, 1322 (Fed.Cir. 2006)).
Conversely, when there is “overlapping of evidence on all
issues,” courts have conducted one trial with respect to the
claims and equitable defenses. Genentech, Inc. v. Wellcome
Found. Ltd., No. 88-330, 1990 WL 69187, at *14 (D. Del. Mar. 8,
1990).

When evidence of equitable defenses overlaps with

matters that are clearly for the jury to decide, such as issues
of infringement, validity and damages in this case, courts have
availed themselves of advisory jury verdicts. See Qualcomm Inc.
v. Broadcom Corp., 548 F.3d 1004, 1009 (Fed. Cir. 2008).
Nevertheless, the equitable defenses ultimately remain a
question of law for the Court to decide. See id.
II.

Application
Amphastar contends that the evidence as to equitable

defenses significantly overlaps with the jury questions. Its
argument addresses five specific examples.
A. Whether the Failure of Momenta and Dr. Shriver to
Disclose the ‘886 Patent is an Admission of NonInfringement
In Amphastar’s view, Momenta did not disclose the ‘886
patent to the USP for either of two reasons: 1) it did not
believe the patent covered the <207> method or 2) it knew that
the patent covered <207> but did not disclose it anyway.

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Thus,

argues Amphastar, the non-disclosure is relevant to both its
non-infringement and its waiver and equitable estoppel defenses.
Momenta replies that 1) Amphastar’s argument assumes that
there was a duty to disclose, 2) Amphastar concedes that the socalled DDB procedure is not the equivalent of UPS <207> and thus
the waiver defense does not apply to it and 3) Amphastar’s
contention that the allegedly infringing 15-25% procedures are
essentially the same as USP <207> is part of its waiver defense,
not an undisputed fact.
Momenta further asserts that the only relevant comparison
for infringement is 1) the language of the claims as construed
by the Court and 2) Amphastar’s conduct.

In its view, Dr.

Shriver’s opinions are irrelevant to infringement.

Amphastar

responds that, in support of its invalidity defense, it plans to
seek testimony from Dr. Shriver about whether the specification
of the ‘886 patent would “allow persons of ordinary skill in the
art to recognize that [the inventor] invented what is claimed.”
See Ariad Pharm., Inc. v. Eli Lilly & Co., 598 F.3d 1336, 1351
(Fed. Cir. 2010) (internal quotations and citations omitted).
Amphastar’s contention that its claim of non-infringement
and its equitable defenses of estoppel and waiver are
inextricable is well taken.

While the existence of a duty to

disclose is factually disputed, if there was such a duty, Dr.

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Shriver’s non-disclosure bears on whether a person of ordinary
skill in the art would understand what the patentee invented.
B. Willful Infringement
Amphastar also asserts that its contention that it
practices USP <207> is relevant to the issue of willful
infringement.

Momenta responds that it will not claim willful

infringement at trial.

Yet Momenta opposes Amphastar’s in

limine motion to exclude evidence of willful infringement,
asserting that it has
the right to introduce evidence of what Amphastar knew,
when Amphastar knew it, and what Amphastar chose to do.
This evidence is relevant to other issues, such as damages
and estoppel.
Docket No. 986 at 1.

Specifically, Momenta asserts that willful

infringement is relevant to 1) Amphastar’s claim that it relied
on USP <207>, which is an element of equitable estoppel, and
2) Amphastar’s failure to seek an alternative to performing the
accused procedures.
This Court agrees that there is significant overlap of the
evidence with respect to willful infringement.

Momenta will be

allowed to introduce the evidence of willful infringement
identified in its opposition to Amphastar’s in limine motion to
exclude evidence of willful infringement, Docket No. 986, but
Amphastar will be permitted, in rebuttal, to offer evidence that
it relied on USP <207>.

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C. Whether Momenta’s Action at the USP is Evidence of
Invalidity
Next, Amphastar claims that Momenta’s statements to the USP
are relevant to Amphastar’s contention that the ‘886 patent
lacks enablement and written description.

Amphastar’s expert,

Dr. Linhardt, relied on Momenta’s statements to the USP that
method <207> 1) is inadequately defined and 2) leads to
inaccurate results in reaching his conclusion that the ‘886
patent is not enabled because it contains even less description
than USP <207>.

Similarly, Dr. Linhardt uses statements made by

Momenta to the USP as evidence that the ‘886 patent lacks
written description because it neither describes the structure
of “peak 9” nor identifies the peak 9 structure as a 1,6-anhydro
ring.
Momenta responds that its statements as to USP <207> are
irrelevant to Amphastar’s enablement and written description
defenses because those defenses examine 1) whether the
specification of the ‘886 patent teaches a person of ordinary
skill in the art the claimed method and 2) whether there is an
adequate written description of the invention.

This Court

concludes that there is an overlap between the Amphastar’s
enablement and written description defenses and the USP events.

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D. The Relevance of Momenta’s Actions at the USP to
Damages
According to Amphastar, the facts underlying its equitable
defenses are also relevant to damages for lost profits and for
reasonable royalties.

To evaluate the calculation of reasonable

royalties, the jury will have to consider the licensor’s policy
and marketing program to maintain a patent monopoly.

Amphastar

asserts that the facts that Momenta 1) offered a royalty-free
license for a heparin-related patent if the USP adopted a
different method and 2) demanded that Sanofi abandon a patent
application because it was implicated in a USP standard rebut
Momenta’s contention that it does not have a policy with respect
to intellectual property related to USP standards.
Momenta counters that it does not sell heparin and would
not license a patent for a product it sells.

Furthermore,

Momenta asserts that evidence about its offer of a royalty-free
license for heparin does not require instructing the jury about
Momenta’s non-disclosure to the USP.

This Court concludes that

there is at least some overlap between events that occurred at
the USP and evidence of damages.
E. Whether the Conduct of Momenta Employees Before the
USP Implicates the Credibility of Its Witnesses
Finally, Amphastar asserts that the events involving the
USP implicate the credibility of 1) Dr. Shriver, the inventor of
the ‘886 patent, who Amphastar intends to call as an individual
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skilled in the art to testify about infringement, validity and
damages, and 2) Dr. Capila, who Momenta plans to call to testify
about infringement.
Momenta retorts that it does not intend to call Dr. Shriver
unless the Court allows the introduction of evidence of
equitable defenses and, furthermore, Amphastar does not have the
right to call him merely to challenge his credibility.

Momenta

also contends that Dr. Capila joined a USP advisory panel that
did not review method <207> and signed his form after <207> had
been issued.
The Court agrees with Amphastar that it may call Dr.
Shriver to testify as a person of ordinary skill in the art if
it so chooses and that Dr. Capila’s credibility could be
implicated by the USP events.

Thus, there is some overlap

between the USP events and witness credibility.
In sum, the evidence relevant to the issues of
infringement, validity and damages is so intertwined with the
putative evidence of equitable defenses that bifurcation is
unwarranted. Genentech, Inc., 1990 WL 69187, at *14.

Moreover,

although the Court will ultimately determine whether the
equitable defenses are determinative, it will seek an advisory
jury verdict thereon in the first instance. See Qualcomm Inc.,
548 F.3d at 1009.

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III.

Avoiding Prejudice
To guard against prejudice, this Court cautions Amphastar

to avoid (and to instruct its witnesses to avoid) pejorative
words such as “deception”, “concealed”, “improper” and
“unethical” in their description of the USP events.

Such

inflammatory terminology is improper and will not be permitted.
It may also result in a reprimand and a limiting instruction to
the jury.
Moreover, because the parties do not dispute that Momenta
failed to disclose the patent application to the USP, such
evidence might more properly be introduced by stipulation and
should not be the subject of cumulative testimony.

The Court

will also consider a limiting instruction to the jury to be
given at the outset of the case that the jury will hear evidence
relative to both the plaintiffs’ claims of infringement,
validity and damages and the defendants’ equitable defenses
which they are to consider and decide separately.

The Court

invites counsel to submit their own version of such an
instruction by the close of business on Monday, July 3, 2017.

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ORDER
In accordance with the foregoing, the evidence relative to
the equitable defenses will be admissible at the impending jury
trial.

So ordered.

/s/ Nathaniel M. Gorton______
Nathaniel M. Gorton
United States District Judge
Dated June 29, 2017

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