ASTRAZENECA LP et al v.BREATH LIMITED et al
Filing
822
OPINION. Signed by Judge Renee Marie Bumb on 5/31/2013. (tf, )
[Dkt. Ents. 742, 744, 801, 819]
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
CAMDEN VICINAGE
Consolidated Civil Action
No. 08-1512 (RMB/AMD)
ASTRAZENECA LP and
ASTRAZENECA AB,
Member cases:
09-1518
09-4115
10-5785
11-3626
Plaintiffs,
v.
BREATH LIMITED,
Defendant.
ASTRAZENECA LP and
ASTRAZENECA AB,
OPINION
Plaintiffs,
v.
APOTEX, INC. and APOTEX
CORP.,
Defendants.
Plaintiffs,
v.
SANDOZ, INC.,
Defendant.
ASTRAZENECA LP and
ASTRAZENECA AB,
1
Plaintiffs,
v.
WATSON LABORATORIES, INC.
Defendant.
_____________________________
APPEARANCES
John E. Flaherty, Esquire
McCarter & English, LLP
Four Gateway Center
100 Mulberry Street
Newark, New Jersey 07102
and
Denise L. Loring, Esquire
Michael P. Kahn, Esquire
Marc A. Cavan, Esquire
Richard T. McCaulley, Esquire
Lewis Fogel, Esquire
Ropes & Gray LLP
1211 Avenue of the Americas
New York, New York 10036
And
Mariam Koodhary, Esquire,
Inhouse Counsel
Eric I. Abraham, Esquire
Christina L. Saveriano, Esquire
Hill Wallack LLP
202 Carnegie Center
Princeton, New Jersey 08543
and
Richard J. Basile, Esquire
David W. Aldrich, Esquire
Benjamin J. Lehberger, Esquire
Erin R. Woelker, Esquire
Alyson J. DiLena, Esquire
St. Onge Steward Johnson &
Reens, LLC
989 Bedford Street
Stamford, Connecticut 069055619
Attorneys for Plaintiffs
AstraZeneca, LP and
AstraZeneca AB
Attorneys for Defendants/
Counterclaim’ Plaintiffs
Apotex,
Inc. and Apotex Corp.
Sheila Raftery Wiggins, Esquire
Duane Morris LLP
744 Broad Street, Suite 1200
Newark, New Jersey 07102
and
Taras A. Gracey, Esquire
Mark H. Remus, Esquire
Abby Parsons, Esquire
Steptoe & Johnson LLC
115 S. LaSalle Street, Suite
3100
Katherine Ann Escanlar, Esquire
Saiber LLC
One Gateway Center, 10th Floor
Newark, New Jersey 07102-5311
and
William A. Rakoczy, Esquire
Amy D. Brody, Esquire
Tara M. Raghavan, Esquire
Heinz J. Salmen, Esquire
Natasha White, Esquire
Rakoczy Molino Mazzochi
Siwik LLP
6 West Hubbard Street, Suite 500
Chicago, Illinois 60654
Attorneys for Defendant/
Counterclaim-Plaintiff Sandoz,
2
Inc.
Attorneys for
Defendant/Counterclaim
Plaintiffs Breath Limited and
Watson Laboratories, Inc.
Bumb, United States District Judge:
Plaintiffs AstraZeneca AB and AstraZeneca LP (“AstraZeneca”)
and defendants Apotex, Inc., and Apotex Corp. (“Apotex”) have
filed motions asking the Court to amend or correct its Opinion
and Order of Judgment, dated April 1, 2013.1
801.]
[Dkt. Ents. 744,
For the reasons that follow, AstraZeneca’s motion is
GRANTED and Apotex’s motion is GRANTED IN PART and DENIED IN
PART.
Additionally, defendant Sandoz, Inc. (“Sandoz”) has filed
a letter advising the Court that its decision not to resolve
certain counterclaims of invalidity, in light of its finding of
non-infringement, may hamper the progression of the pending
appeal.
[Dkt. Ent. 819.]
The Court therefore DISMISSES these
counterclaims without prejudice for the reasons set forth below.
LEGAL STANDARD
Federal Rule of Civil Procedure 59(e) permits a party to
file a motion to alter or amend a judgment “no later than 28 days
1
Although the defendants Breath Limited and Watson Laboratories,
Inc., originally joined in Defendants’ motion for reconsideration
[Dkt. Ent. 742], Apotex subsequently filed an amended motion for
the same relief, which excluded them. The parties have proceeded
as though the original motion was abandoned, and the Court
therefore DISMISSES that motion. [Dkt. Ent. 742.]
3
after the entry of the judgment.”
In the District of New Jersey,
Local Civil Rule 7.1(i) governs motions for reconsideration.
Agostino v. Quest Diagnostics, Inc., Civ. No. 04-4362, 2010 WL
5392688, *5 (D.N.J. Dec. 22, 2010) (citing Bryan v. Shah, 351 F.
Supp. 2d 295, 296 n.2 (D.N.J. 2005)).
Local Rule 7.1(i) “creates
a procedure by which a court may reconsider its decision upon a
showing that dispositive factual matters or controlling decisions
of law were overlooked by the court in reaching its prior
decision.”
Id. (citing Bryan, 351 F. Supp. 2d at 296 n.2).
The “purpose of a motion for reconsideration is to correct
manifest errors of law or fact or to present newly discovered
evidence.”
Harsco Corp. v. Zlotnicki, 779 F.2d 906, 909 (3d Cir.
1985), cert. den’d, 476 U.S. 1171 (1986) (internal citation
omitted). Reconsideration is appropriate if:
(1) there has been
an intervening change in the controlling law; (2) evidence not
available when the Court issued the subject order has become
available; or (3) it is necessary to correct a clear error of law
or fact or to prevent manifest injustice.
Max’s Seafood Café v.
Quinteros, 176 F.3d 669, 677 (3d Cir. 1999) (internal citations
omitted).
ANALYSIS
Apotex asks the Court to reconsider its ruling on certain
kit claims and method claims.
AstraZeneca asks the Court to
clarify its Order of Judgment to specify the asserted claims.
4
In
a letter dated May 30, 2013, Sandoz advised the Court that
certain counterclaims remain pending, thus calling into question
whether the Court’s Order of Judgment constitutes a final
judgment for purposes of appeal.
The Court considers each issue
in turn.
1.
Kit Claims
This is a patent infringement action, which culminated in a
two-month long bench trial in November and December of 2012.
After extensive post-trial briefing, the Court issued a 143-page
Bench Opinion and Order of Judgment on April 1, 2013, resolving
the case in favor of the defendants.
AstraZeneca LP v. Breath
Ltd., Civ. No. 08-1512, 2013 WL 1385224, *4, n.11 (D.N.J. Apr. 3,
2013) (issued under temporary seal on April 1, 2013).
AstraZeneca then filed an emergent motion for an injunction
pending appeal to preclude the defendants from launching their
generic drug products.
The Court denied that motion, but in
consideration of the significance of the interests at stake,
afforded AstraZeneca a ten-day injunction to seek the same relief
from the Federal Circuit.
On May 24, 2013, the Federal Circuit
granted the injunction, without prejudice to the ultimate
disposition of the case by a merits panel.
In a footnote within the April 1st Opinion, the Court
addressed the parties’ dispute as to whether certain kit claims
5
and counterclaims remained in the case.2
The Court found that
AstraZeneca had withdrawn these kit claims and issued covenants
not to sue, which appeared to moot the defendants’ counterclaims
for a declaratory judgment that the kit claims are invalid.
The
Court retained its power to revisit the issue upon motion by the
defendants, however.
Apotex now argues that AstraZeneca could not withdraw the
kit claims from this action because the Court’s preliminary
injunction decision and the Federal Circuit’s opinion affirming
that decision firmly determined the invalidity of these claims.
Apotex contends, in the alternative, that even if the preliminary
injunction decisions did not determine the invalidity of the kit
claims, Apotex’s counterclaims remained in the case, because
AstraZeneca’s covenants not to sue did not strip the Court of its
jurisdiction over them.
Apotex further argues that it proved the
invalidity of the kit claims twice, at the preliminary injunction
stage and at trial.
Article III of the U.S. Constitution grants federal courts
the authority to adjudicate “Cases” and “Controversies.”
“[A]n
‘actual controversy’ must exist not only at the time the
complaint is filed, but through ‘all stages’ of the litigation.”
Already, LLC v. Nike, Inc., -- U.S. --, 133 S. Ct. 721, 726
2
The “kit claims” are claims 29-30 of U.S. patent 6,598,603 (the
“‘603 patent”) and claims 17, 18, 20, 21, and 24-27 of U.S.
patent 6,899,099 (the “‘099 patent”).
6
(2013) (citations omitted).
“A case becomes moot — and therefore
no longer a ‘Case’ or ‘Controversy’ for purposes of Article III —
when the issues presented are no longer live or the parties lack
a legally cognizable interest in the outcome.”
Id. (internal
quotations omitted).
At the outset of this litigation, both parties had standing
to pursue their claims.
AstraZeneca had standing to sue because
Apotex was allegedly infringing its rights under patent law.
Apotex had standing to file its counterclaim because AstraZeneca
was allegedly pressing an invalid patent to prevent Apotex’s
legitimate business activity.
Id. at 727 (citing MedImmune v.
Genentech, Inc., 549 U.S. 118, 126-37 (2007) for the proposition
that “a genuine threat of enforcement of intellectual property
rights that inhibits commercial activity may support standing”).
At the preliminary injunction stage, this Court found the kit
claims invalid.
The Federal Circuit affirmed.
AstraZeneca LP v.
Apotex, Inc., 623 F. Supp. 2d 579, 588-92 (D.N.J. 2009), aff’d,
633 F.3d 1042 (Fed. Cir. 2010).
AstraZeneca subsequently
withdrew its claims of infringement as to the kit claims3 and
gave Apotex a covenant not to sue on these claims.
AZ Ex. B,
Dkt. Ent. 802-1.
3
The Court notes that the parties dispute whether AstraZeneca
actually withdrew its claims at the December 2010 hearing. This
is a moot point, however, since the critical question is whether
Apotex’s counterclaims were rendered moot by AstraZeneca’s
covenant not to sue.
7
Under the Supreme Court’s recent opinion in Nike,
AstraZeneca now has the “formidable burden” of showing that it
“could not reasonably be expected” to resume its enforcement
efforts against Apotex.
133 S. Ct. at 727.4
If AstraZeneca can
show that its covenant not to sue satisfies this burden, then
Apotex’s counterclaims are moot, and this Court lacks
jurisdiction over them.
Stated another way, the critical inquiry
is “whether the facts alleged, under all the circumstances, show
4
AstraZeneca challenges the application of Nike to this case for
two reasons. First, because it involved trademark infringement
and dilution rather than patent infringement. AZ Opp. Br. 12
(citing Nike, 133 S. Ct. at 727). AstraZeneca points to a case
that “questions” whether Nike applies to patent cases, Morvil
Tech., LLC v. Medtronic Ablation Frontiers, LLC, Civ. No. 102088, 2013 WL 1562520, *3 (S.D. Cal. April 11, 2013). AZ Opp.
Br. 12. In Morvil, the district court simply noted that “even
assuming Nike applies to patent cases, it is distinguishable from
the present case.” Id. The Court is not troubled by this
statement. Indeed, the Federal Circuit recently cited Nike in
the context of a patent case. In Arkema, Inc. v. Honeywell
Intern., Inc., the Federal Circuit relied on Nike for the
proposition that a plaintiff’s decision not to grant a covenant
not to sue suggested that an “active and substantial controversy”
existed between the parties. 706 F.3d 1351, 1358 (Fed. Cir.
2013). The Court further notes that Nike addresses Article III
standing issues, which are not specific to trademark law.
Second, AstraZeneca contends that Nike does not apply
because it invoked the voluntary cessation doctrine, which
precludes a party from engaging in unlawful conduct, stopping
when sued to have the case declared moot, and then picking up
where the party left off. AZ Opp. Br. 12. AstraZeneca contends
that “the covenant would preclude AstraZeneca from suing Apotex
for infringement of its generic BIS products that are the subject
of its ANDA.” Id. It seems AstraZeneca is simply arguing the
merits - whether its covenant moots the counterclaims – not the
propriety of applying the test set forth in Nike. Further
undermining AstraZeneca’s position is the fact that in its motion
to dismiss, it cited Nike for support. Dkt. Ent. 683 at 4-6.
Accordingly, the Court rejects these arguments.
8
that there is a substantial controversy, between parties having
adverse legal interests, of sufficient immediacy and reality to
warrant the issuance of a declaratory judgment.”
MedImmune, 549
U.S. at 127.
In Nike, the Supreme Court concluded that the injury, “given
the breadth of the covenant, cannot reasonably be expected to
recur,” thus mooting the defendant’s counterclaims of invalidity.
133 S. Ct. at 732.
Key factors in this determination included:
(1) the covenant’s unconditional and irrevocable nature, (2) its
prohibition on any claim or demand, (3) the inclusion of the
covenant recipient’s distributors and customers, and (4) the
breadth of the prohibition covering present and future designs.
Id at 728.5
By contrast, the covenant here is considerably narrower.
It
states in relevant part:
5
Specifically, the Nike covenant provided:
[Nike] unconditionally and irrevocably covenants to
refrain from making any claim(s) or demand(s) ...
against Already or any of its ... related business
entities ... [including] distributors ... and employees
of such entities and all customers ... on account of
any possible cause of action based on or involving
trademark infringement, unfair competition, or
dilution, under state or federal law ... relating to
the NIKE Mark based on the appearance of any of
Already's current and/or previous footwear product
designs, and any colorable imitations thereof,
regardless of whether that footwear is produced ... or
otherwise used in commerce before or after the
Effective Date of this Covenant.
Id. at 728 (emphasis in original).
9
AstraZeneca hereby covenants not to sue [Apotex] for
infringement of the Kit Claims, as they now read, by
Apotex’s budesonide inhalation suspension, 0.25 mg/2ml
and 0.5 mg/2ml as described in Apotex’s Abbreviated New
Drug Application No. 78-202, as approved and as it
existed on March 30, 2009 . . . . The covenant does not
reach other products or changes to Apotex’s budesonide
inhalation suspension, 0.25 mg/2ml and 0.5 mg/2ml, or
uses of such products, as described in Apotex’s ANDA
No. 78-202 as approved and as it existed on March 30,
2009.
AZ Ex. B (emphasis added).
Unlike in Nike, AstraZeneca’s
covenant does not state that it is unconditional and irrevocable
and does not cover its suppliers, distributors, and customers.
Further, and most importantly, it only covers Apotex’s
Abbreviated New Drug Application (“ANDA”) as originally filed
with the FDA as of a particular date.
Apotex represents that it
has already amended or supplemented its ANDA and that the
relevant filing date has changed, so the covenant does not even
cover its current ANDA.6
Ap. Moving Br. 11; Ap. Reply Br. 10.
AstraZeneca disputes this, responding that Apotex has not
explained how any ANDA amendments or supplementations would
change its products so as to bring them outside the covenant.
AZ
Opp. Br 13.
6
Apotex also contends that Astrazeneca’s covenant does not
cover other dosing strengths, such as if Apotex were to seek
approval for a 1.0 mg dosage. Apotex has not indicated, however,
that it plans to even make such a dosage, thus calling into
question whether a substantial dispute exists here or whether
such a controversy is merely hypothetical. However, this point
is moot, since the Court finds the covenant inadequate on other
grounds.
10
“Whether a covenant not to sue will divest the trial court
of jurisdiction depends on what is covered by the covenant.”
Revolution Eyewear, Inc. v. Aspex Eyewear, Inc., 556 F.3d 1294,
1297 (Fed. Cir. 2009) (finding Article III case or controversy
where covenant not to sue did not bar future infringement actions
if accused infringer again offered for sale the allegedly
infringing articles).
In Revolution Eyewear, the Federal Circuit
applied the Supreme Court’s test in MedImmune as set forth in
SanDisk Corp. v. STMicroelectronics, Inc., 480 F.3d 1372 (Fed.
Cir. 2007), holding:
[W]here a patentee asserts rights under a patent based
on certain identified ongoing or planned activity of
another party, and where the party contends that it has
the right to engage in the accused activity without a
license, an Article III case or controversy will arise
and the party need not risk a suit for infringement by
engaging in the identified activity before seeking a
declaration of its legal rights.
Revolution Eyewear, 556 F.3d at 1297 (quotations omitted).
The
Court “explained that declaratory judgment jurisdiction is met
when the patentee ‘puts the declaratory judgment plaintiff in the
position of either pursuing arguably illegal behavior or
abandoning that which he claims a right to do.’”
Id. at 1298
(quoting SanDisk, 480 F.3d at 1381).
Here, Apotex has represented that its ANDA has already been
amended since the filing date of March 30, 2009, and since the
covenant only provides protection to Apotex’s ANDA “as it existed
on March 30, 2009,” AZ Ex. B, it is clear that Apotex’s current
11
ANDA falls outside the scope of this covenant.
Thus, Apotex is
in precisely the position described in Revolution Eyewear: it
must either pursue arguably illegal behavior in launching its
product or abandon its plan to launch, even though Apotex claims
a right to do so (on the grounds that the kit claims are
invalid).
AstraZeneca points to Medeva Pharma Suisse, A.G. v. Par
Pharm., Inc., 774 F. Supp. 2d 691, 698-99 (D.N.J. 2011), where
the district judge found that a covenant not to sue on a
particular patent deprived the defendant of standing to seek a
declaratory judgment on that patent.
distinguishable.
Medeva is readily
First, the parties there did not dispute the
adequacy of the covenant.
Id. at 699.
Second and most
importantly, the Medeva covenant identified the protected
products as of the date of the covenant, unlike here, where the
covenant identifies the protected products as of the filing date
of Apotex’s ANDA, which according to Apotex has already changed.
Id. at 698-99.
Additionally, Apotex expresses legitimate concern that this
covenant is “unreliable” because it conflicts with AstraZeneca’s
exclusive licensing agreement with Teva.
That agreement provides
that AstraZeneca will not “grant to any Third Party a covenant
not to sue with respect to the infringement of AstraZeneca
Patents . . . .”
AZ Ex. C at 6, § 2.1; Ap. Br. 12.
12
AstraZeneca
responds that (1) Teva does not have “all” rights to bring suit
under the ‘609 and ‘099 patents, and (2) if Teva brought suit
against Apotex, AstraZeneca would be an indispensable party and
must be joined, but the covenant not to sue would prevent
AstraZeneca from joining the action.
original).
AZ Opp. Br. 14 (emphasis in
Notably, however, AstraZeneca has not addressed the
possibility that Teva may sue both the defendants and
AstraZeneca.
Thus, AstraZeneca, a necessary party, would join
the action but would not itself sue the defendants (thereby
avoiding violation of the covenant).
7 Wright & Miller, Fed.
Prac. & Proc. § 1614 n.31 (3d ed. 2013) (a patent owner who
refuses to join as a party but is subject to service of process,
may be joined as a defendant).
Based on the above analysis, AstraZeneca has failed to show
that it could not reasonably be expected to resume its
enforcement efforts against Apotex.
Moreover, even if the burden
fell on Apotex to establish standing, the Court would still
conclude that a case or controversy remains because the covenant
does not cover Apotex’s current ANDA.
Accordingly, Apotex’s
counterclaims survived AstraZeneca’s issuance of the covenant not
to sue.
Under these circumstances, reconsideration is clearly
necessary to correct a clear error of law and to prevent manifest
injustice.
Max’s Seafood Café v. Quinteros, 176 F.3d 669, 677
(3d Cir. 1999).
13
The next question the Court must decide is whether Apotex
has proved its counterclaims and established that the kit claims
are invalid.
Putting aside whether the Federal Circuit’s
decision at the preliminary injunction stage binds this Court’s
decision under the law-of-the-case doctrine, see generally Am.
Civil Liberties Union v. Mukasey, 534 F.3d 181, 187 (3d Cir.
2008), cert. den’d, 555 U.S. 1137 (2009) (“[W]hen a court decides
upon a rule of law, that decision should continue to govern the
same issues in subsequent stages in the same case.”), the Court
sees no reason to alter its prior opinion anyway.
The
counterclaims present a legal issue, so there was no need for
further development of the factual record beyond the record from
the preliminary injunction hearing.
Since the budesonide drug
suspension was known in the prior art, the issue raised by the
kit claims was whether the accompanying label, which indicated a
regimen of not more than once per day, was entitled to patentable
weight.
AstraZeneca, 633 F.3d at 1063.
Both the Federal Circuit
and AstraZeneca characterized this as a legal issue.
AstraZeneca, 633 F.3d at 1064 (“‘[W]hether the asserted claims .
. . are invalid for failure to claim statutory subject matter
under 35 U.S.C. § 101 is a question of law which we review
without deference.”); AZ Appellate Br., Ap. Ex. A, Dkt. Ent. 8121 (“Did the District Court incorrectly resolve the legal issue of
whether AstraZeneca’s kit claims were invalid as improperly
14
incorporating ‘printed matter’ when the District Court relied on
In re Ngai, 367 F.3d 1336 (Fed. Cir. 2004) (per curiam) . . .
.”).
Before issuing its preliminary injunction opinion, this
Court ordered supplemental briefing on this issue.
The Court
further notes that the record from this preliminary injunction
hearing is part of the trial record.
Fed. R. Civ. P. 65(a)(2)
(“Even when consolidation [of the preliminary injunction hearing
with the trial on the merits] is not ordered, evidence that is
received on the motion [for preliminary injunction] and that
would be admissible at trial becomes part of the trial record and
need not be repeated at trial.”).
AstraZeneca avers that had it known the kit claims were
still in the case, it would have taken affirmative steps to
adduce evidence at trial to demonstrate their validity.
Br. 16.
AZ Opp.
Since this was a legal issue, however, it is unclear
what type of evidence AstraZeneca would have presented.
AstraZeneca is silent on this point.
In any event, Apotex
repeatedly raised this issue before trial, in the Joint Final
Pretrial Order and at a pre-trial conference with the Court.
Pre-trial Conf. Tr. 14, Dkt. Ent. 644; Joint Final Pretrial
Order, Dkt. Ent. 700 at 14.
On both occasions, Apotex argued
that AstraZeneca’s covenants did not moot its counterclaims,
which remained in the case.
AstraZeneca even addressed the issue
in its statement of the case in the Joint Final Pretrial Order.
15
Dkt. Ent. 700 at 9.
The Court thus finds that AstraZeneca was on
notice that the counterclaims were still at issue in this
litigation.
For the reasons set forth in this Court’s preliminary
injunction decision and the Federal Circuit’s opinion affirming
that decision, the Court again finds, as a matter of law, that
the kit claims are invalid.
AstraZeneca, 623 F. Supp. 2d at 588-
91; AstraZeneca, 633 F.3d at 1063-65.
The Court therefore enters
judgment in favor of Apotex on its counterclaims pertaining to
the kit claims.7
2.
Method Claims
Apotex also moves for reconsideration of the Court’s ruling
on method claims 6, 11, 18, and 21-23 of the ‘603 patent (the
“method claims”).
Throughout the litigation, AstraZeneca
maintained that Apotex infringed these claims.
Apotex
counterclaimed that the method claims were invalid.
AstraZeneca
included the method claims in its infringement contentions in the
Joint Final Pretrial Order.
Dkt. Ent. 700 at 5.
At trial,
AstraZeneca chose to abandon these claims and did not present any
evidence to support them.
In its Bench Opinion, the Court noted
in a footnote that AstraZeneca had conceded the method claims.
7
Thus, the Court need not reach Apotex’s alternative argument
that AstraZeneca’s purported removal of jurisdiction over
Apotex’s counterclaims occurred after the preliminary injunction
decisions had already firmly determined the invalidity of the kit
claims. Ap. Br. 5.
16
AstraZeneca LP v. Breath Ltd., Civ. No. 08-1512, 2013 WL 1385224,
*4, n.11 (D.N.J. Apr. 3, 2013) (entered under temporary seal on
April 1, 2013).
prejudice.
The Court therefore dismissed these claims with
Id.
Apotex now argues that the Court should enter judgment as
opposed to dismissal on the method claims, as the Court did when
it granted the defendants’ motion for judgment on partial
findings under Rule 52(c) as to certain other claims, which
AstraZeneca had abandoned at trial.
610).
Id. at n.6 (citing Dkt. Ent.
Apotex also asks the Court to rule on its counterclaims of
invalidity.
As to the first issue, although the Court did not use the
word “judgment”, it certainly viewed this “dismissal with
prejudice” as a final judgment on the method claims, just like
its ruling on the other claims AstraZeneca had abandoned at
trial.
Like those other claims, AstraZeneca included the method
claims in the Joint Final Pretrial Order.
Dkt. Ent. 700 at 5.
The final pretrial order “controls the course of the action
unless the court modifies it,” Fed. R. Civ. P. 16(d); it
effectively supersedes the pleadings and defines the issues for
trial.8
DiNenno v. Lucky Fin Water Sports, LLC, 837 F. Supp. 2d
419, 423 & n.8 (D.N.J. 2011) (citing Basista v. Weir, 340 F.2d
8
Generally, prior to the entry of a final pretrial order, “[a]
plaintiff who wishes to drop some claims but not others should do
so by amending his complaint pursuant to Rule 15.” 9 Wright &
17
74, 85 (3d Cir. 1965)) (collecting cases); see also Mechmetals
Corp. v. Telex Computer Prods., Inc., 709 F.2d 1287, 1294 (9th
Cir. 1983) (party’s attempt to withdraw claims at trial required
modification of pretrial order).
Since AstraZeneca never sought to withdraw the method claims
from the Joint Final Pretrial Order, these claims proceeded to
trial, where AstraZeneca chose to abandon them.
In fact, the
Court notes that AstraZeneca did not move for reconsideration of
the Court’s Opinion dismissing these claims with prejudice.
The Court understands Apotex’s desire for clarity on this
issue, given the many years of vigorous litigation on these
claims.
To clarify, the Court’s Order dismissing the method
claims with prejudice effectively represents a final judgment of
non-infringement in favor of all of the defendants.
As for Apotex’s second argument, the Court must determine
whether it should enter judgment on Apotex’s counterclaims of
invalidity as to the method claims.
The first issue to resolve is whether Apotex had standing to
assert these counterclaims at trial.
Since the Court has found
that AstraZeneca did not withdraw its infringement claims,
Apotex’s counterclaims of invalidity presented a live case or
controversy.
Fort James Corp. v. Solo Cup. Co., 412 F.3d 1340,
1348 (Fed. Cir. 2005), cert. den’d, 547 U.S. 1069 (2006) (citing
Miller, supra, § 2362.
18
Cardinal Chem. Co. v. Morton Int’l, Inc., 508 U.S. 83, 95 (1993))
(“[A] case or controversy adequate to support jurisdiction of a
declaratory judgment counterclaim necessarily exists if a party
has actually been charged with infringement of a patent.”).
Next, the Court must consider whether the judgment of noninfringement divested the Court of subject matter jurisdiction
over Apotex’s invalidity counterclaims.
MedImmune, 549 U.S. at
127 (finding that there must be “a substantial controversy,
between parties having adverse legal interests, of sufficient
immediacy and reality to warrant the issuance of a declaratory
judgment”); Cardinal Chem., 508 U.S. at 95-96 (holding that
appellate affirmance of a non-infringement judgment did not moot
trial court’s invalidity judgment but stressing that in the trial
court, “of course, a party seeking a declaratory judgment has the
burden of establishing the existence of an actual case or
controversy”).
Federal Circuit jurisprudence, albeit pre-
MedImmune, suggests that the Court retains jurisdiction over
these invalidity counterclaims.
Fort James, 412 F.3d at 1348
(holding that covenant did not moot counterclaim for
unenforceability where jury had already returned verdict of noninfringement, because “a counterclaim questioning the validity or
enforceability of a patent raises issues beyond the initial claim
for infringement that are not disposed of by a decision of noninfringement”).
Nevertheless, the judgment of non-infringement
19
here does seem to extinguish any threat of future enforcement or
litigation, and the Court thus questions whether a live case or
controversy truly exists concerning these invalidity
counterclaims.
The Court need not decide this issue, however, since it
declines to exercise jurisdiction over the counterclaims.
Liquid
Dynamics Corp. v. Vaughan Co., 355 F.3d 1361, 1371 (Fed. Cir.
2004) (“A district court judge faced with an invalidity
counterclaim challenging a patent that it concludes was not
infringed may either hear the claim or dismiss it without
prejudice, subject to review only for abuse of discretion.”)
(citations omitted); Cardinal Chem., 508 U.S. at 95 n.17 (“[T]he
Declaratory Judgment Act affords the district court some
discretion in determining whether or not to exercise that
jurisdiction, even when it has been established.”); Wells-Gardner
Elec. Corp. v. C. Ceronix, Inc., Civ. No. 10-2536, 2011 WL
1467182, *3 (N.D. Ill. Apr. 14, 2011) (collecting cases).
Here,
the non-infringement judgment firmly and clearly resolves the
case, and Apotex has not shown how a judgment of invalidity would
provide any additional benefit.
These counterclaims are
therefore dismissed without prejudice.
For these reasons, the Court grants in part and denies in
part Apotex’s motion for reconsideration with respect to the
method claims.
20
3.
Counterclaims of Invalidity of the ‘834 Patent9
Sandoz has advised the Court that its April 1st Order may
not be considered a final judgment because it did not resolve the
counterclaims of invalidity for the ‘834 patent.
In the April 1
Opinion, the Court determined that these counterclaims were moot
in light of the Court’s finding of non-infringement.
The Court
now clarifies that it declines to exercise jurisdiction over
these counterclaims.
resolves the case.
The Court’s non-infringement finding
The Court need not expend additional judicial
resources in this already extensively litigated case on
counterclaims that may, effectively, become moot by the Federal
Circuit’s decision.
The Court therefore dismisses these
counterclaims without prejudice.
4.
Clarification of Order to Identify Specific Claims at
Issue
AstraZeneca asks the Court to clarify its April 1st Order of
Judgment to specify the asserted claims at issue in this
litigation rather than simply the relevant patents.
While the
Opinion accompanying that Order specifies the asserted claims,
the Court will grant AstraZeneca’s request and amend the Order of
Judgment to formally specify the asserted claims.
CONCLUSION
9
U.S. Patent No. 7,524,834.
21
For the reasons set forth above, the Court GRANTS
AstraZeneca’s motion and GRANTS IN PART and DENIES IN PART
Apotex’s motion.
The Court also addresses Sandoz’s concerns by
dismissing without prejudice the defendants’ counterclaims of
invalidity of the ‘834 patent.
An Order consistent with this
Opinion will issue herewith.
s/Renée Marie Bumb
RENÉE MARIE BUMB
United States District Judge
22
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