ELAN PHARMA INTERNATIONAL LTD. et al v. LUPIN LIMITED et al

Filing 37

OPINION. Signed by Judge Joseph A. Greenaway, Jr. on 03/31/2010. (nr, )

N O T FOR PUBLICATION U N I T E D STATES DISTRICT COURT F O R THE DISTRICT OF NEW JERSEY : : : : : : : : : : : : :

E LA N PHARMA INTERNATIONAL LT D . and FOURNIER LABORATORIES IR E LA N D LTD., P l a i n t i ffs , v. LU P IN LIMITED and LUPIN P H A R M A C E U T IC A LS , INC., D e fe n d a n t s . G R E E N A W A Y , JR., U.S.C.J.*

C iv il Action No. 09-1008 (JAG) O PIN IO N

T h is matter comes before this Court on the motion by the plaintiffs, Elan Pharma In t e r n a t io n a l Ltd. and Fournier Laboratories Ireland Ltd. (collectively, "Plaintiffs" or "Elan"), s e e k in g to dismiss the defendants', Lupin Limited and Lupin Pharmaceuticals, Inc. (collectively, " D e fe n d a n ts " or "Lupin") counterclaims, pursuant to Federal Rule of Civil Procedure 12(b)(6) a n d to strike certain defenses, pursuant to Federal Rule of Civil Procedure 12(f). (Docket Entry N o . 22.) For the reasons set forth below, Elan's Motion to Dismiss Defendants' Counterclaims a n d its Motion to Strike Certain Defenses are denied. P R O C E D U R A L HISTORY T h es e motions concern the alleged failure by Lupin to provide, in their responsive p le a d in g, sufficient factual support for their counterclaims and affirmative defenses. On March 6, 2009, Elan filed a Complaint which avers that Lupin infringed U.S. Patent N o s . 7,276,249 ("the '249 patent") and 7,320,802 ("the '802 patent") by filing an Abbreviated

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Sitting by designation on the District Court.

N e w Drug Application ("ANDA").1 (Docket Entry No. 1.) On May 8, 2009, Lupin filed its " A n s w e r, Defenses, and Counterclaims" ("Answer"), and included U.S. Patent No. 6,375,986 (" th e '986 patent") because the '986 patent is also listed in FDA's Orange Book in connection w ith TRICOR®.2 (Docket Entry No. 12.) In its counterclaims asserting non-infringement of the '986, '249 and '802 patents, Lupin a v e rs that "the manufacture, use, sale, offer for sale or importation of the fenofibrate tablets have n o t infringed, do not infringe, and would not, if marketed, infringe any valid and enforceable c la im " of the '986, '249 or '802 patents. (Answer at 13-16). Specifically, Lupin states that the c la im s of the '986, '249, and '802 patents respectively, are "invalid under one or more provisions o f 35 U.S.C. §§ 101 - 105." (Id.) On June 12, 2009, Elan filed its "Memorandum in Support of Plaintiffs' Motion to D is m is s Defendants' Counterclaims and Strike Certain Defenses". (Docket Entry No. 22.) Elan a rgu e s that Lupin "generically asserted in its defenses and counterclaims that the '249, '802 and '9 8 6 patents were invalid under one or more provisions of 35 U.S.C. §§ 101 - 105." (Memorandum in Support of Plaintiffs' Motion to Dismiss Defendants' Counterclaims and to S trik e Certain Defenses at 2.) Elan contends that Lupin alleged the counterclaims and affirmative d e fe n s e s without pleading facts that, if true, would entitle Defendants to relief. (Id. at 1.) Elan m o v e s this Court to dismiss Lupin's counterclaims and to strike certain affirmative defenses a s s e rte d by Lupin.3 (Id.)

Lupin filed ANDA No. 90-856, seeking approval to sell generic copies of TRICOR® 48 m g and 145 mg products (Elan's patented product). Lupin claims that the '986 patent is also invalid, and that it (the '986 patent) is not i n f ri n g e d by Defendants' generic product.
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Lupin requests leave to file an amended answer, should this Court grant Elan's motion.

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L E G A L STANDARDS A . Rule 12(b)(6) Motion to Dismiss F e d e ra l Rule of Civil Procedure 12(b)(6) provides that a party may move to dismiss a c la im for relief in any pleading for failure to state a claim upon which relief can be granted. "Federal Rule of Civil Procedure 8(a)(2) requires only a short and plain statement of the c la im showing that the pleader is entitled to relief, in order to give the defendant fair notice of w h a t the . . . claim is and the grounds upon which it rests." Bell Atl. Corp. v. Twombly, 550 U.S. 5 4 4 , 555 (2007) (internal quotations omitted). "[A] complaint attacked by a Rule 12(b)(6) m o tio n to dismiss does not need detailed factual allegations. [However,] a plaintiff's obligation to provide the `grounds' of his `entitle[ment] to relief' requires more than labels and conclusions, a n d a formulaic recitation of the elements of a cause of action will not do." Id. (internal citations o m itte d ). "While legal conclusions can provide the framework of a complaint, they must be s u p p o r te d by factual allegations." Ashcroft v. Iqbal, 129 S. Ct. 1937, 1950 (2009). "[A] court c o n s id e r in g a motion to dismiss can choose to begin by identifying pleadings that, because they a re no more than conclusions, are not entitled to the assumption of truth." Id. A court must " d r a w all reasonable inferences in [the non-movant's] favor." See Capogrosso v. Supreme Court o f N.J., 588 F.3d 180, 184 (3d Cir. 2009). " W h e n there are well-pleaded allegations, a court should assume their veracity and then d e te rm i n e whether they plausibly give rise to an entitlement of relief." Id.; see also Fowler v. U P M C Shadyside, 578 F.3d 203, 210-11 (3d Cir. 2009) (articulating a two-part test applicable p o s t-Iq b a l wherein factual and legal elements are separated and the district court determines w h e th e r a plaintiff has shown a "plausible claim for relief"). A motion to dismiss for failure to state a claim should be granted only if the party a s s e r t in g the claim is unable to articulate "enough facts to state a claim to relief that is plausible

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o n its face." Twombly, 550 U.S. at 570. "The defendant bears the burden of showing that no c l a i m has been presented." Hedges v. United States, 404 F.3d 744, 750 (3d Cir. 2005). In reviewing a motion to dismiss for failure to state a claim upon which relief can be g ra n t e d , a court may consider the allegations of the complaint, as well as documents attached to o r specifically referenced in the complaint, and matters of public record. Pittsburgh v. W. Penn P o w e r Co., 147 F.3d 256, 259 (3d Cir. 1998). "Plaintiffs cannot prevent a court from looking at t h e texts of the documents on which [their] claim is based by failing to attach or explicitly cite th em ." In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1426 (3d Cir. 1997). "[A] ` d o c u m e n t integral to or explicitly relied upon in the complaint' may be considered `without c o n v e r t in g the motion [to dismiss] into one for summary judgment.'" Id. (emphasis in original)

B. Rule 12(f) Motion to Strike
F e d e ra l Rule of Civil Procedure 12(f) provides, inter alia, that the court may strike from t h e pleading an insufficient defense or immaterial matter. A motion to strike, pursuant to Rule 1 2 (f), will be granted only where "the insufficiency of the defense is clearly apparent." Cipollone v . Liggett Group, Inc., 789 F.2d 181, 188 (3d Cir. 1986) (internal quotation omitted); see also In re Gabapentin Patent Litig., 648 F. Supp. 2d 641, 647-48 (D.N.J. 2009) (a court may only strike a d e fe n se where that defense "is insufficient at law and it cannot succeed under any c irc u m s ta n c e s " ). The standard used to evaluate a motion to dismiss under Federal Rule of Civil Procedure 1 2 (b )(6 ) is also used to evaluate a motion to strike. See Eisai Co., Ltd. v. Teva Pharm. USA, In c . , 557 F. Supp. 2d 490, 493 (D.N.J. 2008) ("[A] motion to strike an affirmative defense c h a l le n g e s the legal sufficiency of the pleading and is therefore governed by the same standard as a 12(b)(6) motion to dismiss."). An affirmative defense is insufficient as a matter of law if it c a n n o t succeed under any circumstances. Id.

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A c co rd in gly, to determine whether Defendants' affirmative defenses are insufficient, the C o u rt must accept all factual allegations in the Answer as true, construe the Answer in the light m o s t favorable to Defendants, and determine whether, under any reasonable reading of the p le a d in gs , Defendants may be entitled to relief. Phillips v. County of Allegheny, 515 F.3d 224, 2 3 3 (3d Cir. 2008). C . Local Patent Rules for the District of New Jersey O n January 1, 2009, New Jersey adopted Local Patent Rules ("L. Pat. R."), which apply to a ll civil actions filed in, or transferred to, this Court which allege infringement of a patent in a c o m p la in t, counterclaim, cross-claim or third party claim, or which seek a declaratory judgment th a t a patent is not infringed, is invalid or is unenforceable. L. Pat. R. 1.2. The Local Civil Rules o f this Court shall also apply to such actions, except to the extent that they are inconsistent with th e s e Local Patent Rules. Id. Lo c a l Patent Rule 3.1 requires that within 14 days of the initial scheduling conference, the p a te n t holder must serve the alleged infringer a "Disclosure of Asserted Claims and Infringement C o n te n tio n s " , which must contain, inter alia: 1. E a c h claim of each patent in suit that is allegedly infringed including the a p p lic a b le statutory subsections of 35 U.S.C. § 271 asserted; T h e identification of defendant's "Accused Instrumentality"; A chart identifying where each limitation of each asserted claim is found in e a c h "Accused Instrumentality"; W h e th e r the alleged infringement is literal or under the doctrine of e q u iv a l e n t s ; T h e priority date to which each asserted claim allegedly is entitled; and T h e basis for any willful infringement claims.

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5. 6. L. Pat. R. 3.1.

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Lo c a l Patent Rule 3.3 also requires that 45 days after service of the Disclosure of Asserted C l a i m s and Infringement Contentions, each party opposing a claim of patent infringement, shall s e rv e on all parties its "Invalidity Contentions," which must contain, inter alia, the following i n fo r m a t i o n : 1. T h e identity of each item of prior art that allegedly anticipates each a s s e rte d claim or renders it obvious; W h e t h e r each item of prior art anticipates each asserted claim or renders it ob viou s; A chart identifying where specifically in each alleged item of prior art each lim i ta tio n of each asserted claim is found, including for each limitation th a t each party contends is governed by 35 U.S.C. § 112(6), the identity of th e structure(s), act(s), and material(s) in each item of prior art that p e rfo rm s the claimed function; and A n y grounds of invalidity based on 35 U.S.C. § 101, indefiniteness under 3 5 U.S.C. § 112(2) or enablement or written description under 35 U.S.C. § 1 1 2 (1 ) of any of the asserted claims.

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L. Pat. R. 3.3. A N AL Y SIS T h e s e motions raises the issue of how the Supreme Court's recent pronouncements in T w o m b l y and Iqbal regarding the threshold for pleading sufficient facts to defeat a motion to d is m i s s apply in ANDA actions. Specifically, these motions raise the question of whether the a p p lic a tio n of those cases reorders the burdens and obligations of the parties at the pleading s ta ge . Here, Elan posits that Lupin must provide a quantum of facts in its answer that far exceeds th e `bare and naked assertions' Lupin, according to Elan, has provided thus far. As such, Elan a s s e rts that Lupin's counterclaims must be dismissed, and two of Lupin's defenses must be s tru c k . In this Court's view, the requirements of ANDA actions, and adherence to our local p a t e n t rules, do not mandate the result Elan seeks.

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Lu p in asserts six counterclaims in its answer ­ three counterclaims asserting invalidity on e a c h of the three patents at issue, and three counterclaims asserting non-infringement on each of th e three patents at issue. Elan moves to dismiss all six counterclaims, and moves to strike two id e n tifie d affirmative defenses. Elan contends that Lupin's counterclaims do not meet the pleading requirements because Lu p i n merely asserts that "the '249,'802 and the '986 patents are invalid under one or more p ro v is io n s of 35 U.S.C. §§ 101 - 105," without identifying which possible provision(s) would be a p p l ic a b l e to its invalidity defense. (Brief in Support of Defendants' Opposition to Motion to D is m is s Counterclaims and Strike Certain Defenses at 2). Lupin responds that its counterclaims a n d defenses comply with the Rule 8 notice pleading standard, and that there is no need for s u p p le m e n tin g the facts through an amended pleading. F e d e ra l Civil Rule 8(a)(2) requires that pleadings contain "a short and plain statement of th e claim showing that the pleader is entitled to relief" in order to give the opposing party notice o f what the claim is and the grounds upon which it rests. McZeal v. Sprint Nextel Corp., 501 F . 3 d 1354, 1356 (Fed. Cir. 2007) (quoting Twombly, 127 S. Ct. at 1964). In McZeal, the Federal C i rc u it considered whether the Supreme Court's decision in Twombly changed the pleading re q u ire m e n t s of Rule 8(a) in patent infringement actions, and concluded that it did not. See M c Z e a l, 501 F. 3d at 1357 n.4 ("[t]his does not suggest that Twombly changed the pleading re q u ire m e n t of Federal Rule of Civil Procedure 8"); see also Twombly, 127 S. Ct. at 1974 (Rule 8 d o e s "not require heightened fact pleading of specifics, but only enough facts to state a claim for re lie f that is plausible on its face"). The Court of Appeals for the Third Circuit has provided detailed and highly instructive gu id a n c e as to what type of allegations qualify as sufficient to meet the Rule 8 pleading standard, s ta tin g, "a claim requires a complaint with enough factual matter (taken as true) to suggest" the

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re q u ire d element. Cummings v. Henn, Civ. Action No. 09-747, 2009 U.S. Dist. LEXIS 21065 at * 3 (D.N.J. March 17, 2009) (quoting Phillips, 515 F.3d at 234 (internal citations omitted)). This " d o e s not impose a probability requirement at the pleading stage," but rather "calls for enough fa c t s to raise a reasonable expectation that discovery will reveal evidence of the necessary e le m e n t." Id. Lu p i n ' s six counterclaims for non-infringement and invalidity of the three patents adhere to the pleading standard enunciated in Rule 8(a)(2). Elan has full notice of Lupin's claims of n o n - in fr in g e m e n t and invalidity, and Lupin has stated the grounds for these claims. Based on this a s s e s s m e n t , the Phillips standard is met. M o re important, it is Elan that has the burden of proof in establishing infringement of the p a te n ts at issue. "A party asserting infringement must be able to prove by a preponderance of the e v id e n c e that a product meets each and every limitation of the asserted claims either literally or u n d er the doctrine of equivalents." In re Gabapentin Patent Litig., 393 F. Supp. 2d 278, 290 ( D .N .J . 2005). E la n 's motion to dismiss Lupin's counterclaims and motion to strike certain affirmative d e fe n s e s for lack of factual information is without a sound foundation. Lupin's language in its c o u n te rc la im s and affirmative defenses mirrors the language Elan employed in its own C o m p l a in t . There is no basis for this Court to, on the one hand, allow Elan to plead as it has w h i le , on the other hand, require Lupin, inexplicably, to provide more detailed factual support for i ts counterclaims and defenses. The notion that Lupin must identify what theories of invalidity it in t e n d s to pursue, and the facts supporting such theories at this stage is not plausible. A d d i ti o n a l l y, the Local Patent Rules require specificity at a later stage than Elan argues is r e q u i re d , pursuant to Twombly and Iqbal. Both Elan and Lupin will have to disclose their re s p e c tiv e theories and the accordant facts in order to comply with Local Patent Rules 3.1 and

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3 .3 .4 This motion suggests a factual disclosure that the Federal Circuit does not require, and a d is c lo s u re that, if required here, would make Rules 3.1 and 3.3 superfluous.5 This Court cannot ru l e in a manner that undermines logic, the Federal Rules, and the District of New Jersey Local P a t e n t Rules. E l a n suffers no strategic disadvantage from this Court not ordering further factual support fo r Lupin's counterclaims. Elan's ability to provide the Local Civil Rule 3.1 disclosure is not h a m p e r e d or inhibited as a result of this ruling. The crux of Twombly and Iqbal is to ensure that th e defendant (here, Elan, the counterclaim defendant) has fair notice of what is being pled. Elan h a s that notice. F in a lly, Plaintiff urges this Court to follow and apply the rationale set forth in a District of N e v a d a case ­ Duramed Pharmaceuticals v. Watson Laboratories, Civ. Action No. 08-00116, 2 0 0 8 U.S. Dist. LEXIS 103389 (D. Nev. December 12, 2008). In the first instance, this Court is n o t obligated to follow a District of Nevada precedent. In Duramed, the court, when addressing a m o tio n to dismiss on grounds similarly argued here, ruled that the motion to dismiss should be gra n te d . In the terse opinion, the court noted that the defendants' counterclaims and affirmative d e fe n s e s failed to specify the grounds for the invalidity and infringement claims asserted, and that

The District Court of New Jersey Local Patent Rules are designed to require parties to c rys ta lliz e their theories of the case early in the litigation. Local Patent Rule 3.1 (Patent D i s c lo s u re s ) requires that a party claiming patent infringement shall serve a "Disclosure of A s s e r te d Claims and Infringement Contentions" on all parties. Within the Disclosure, the party m u s t provide, among other information, each claim of each patent in suit that is allegedly in frin ge d by each opposing party, including for each claim the applicable statutory subsections of 3 5 U.S.C. § 271 asserted. L. Pat. R. 3.1(a). Forty-five days after service of the disclosure, each p a r t y opposing a claim of patent infringement shall serve on all parties its "Invalidity C o n te n tio n s " , which identifies, among other things, "any grounds of invalidity based on 35 U .S .C . § 101 . . ." L. Pat. R. 3.3(d). Lupin also states that the Plaintiffs fail to reveal what additional detail is required to p ro v id e Elan with sufficient information to formulate a response. The level of detail Elan seeks fro m Lupin will be obtained during discovery, as elucidated in the Local Patent Rules.
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s u c h deficiencies warranted dismissal. Notably, this ruling lacks sufficient analysis to be helpful to the resolution of the motions before this Court. There is no discussion of the nature and timing o f disclosure regarding the facts and theories relevant to ANDA claims. Further, unlike the D is tric t of New Jersey, there are no local patent rules in the District of Nevada.6 Based on these d i s tin c t io n s , Duramed is not persuasive. E l a n 's Motion to Strike T h e rationale employed in denying Elan's motion to dismiss Lupin's counterclaims leads t o the same conclusion regarding Elan's motion to strike two affirmative defenses.7 Lupin's s e c o n d defense states that "the claims of the '249 patent are invalid under one or more provisions o f 35 U.S.C. §§ 101 - 105", while its third defense states that "the claims of the '802 patent are in v a lid under one or more provisions of 35 U.S.C. §§ 101 - 105." (Answer at 10.) The d is c lo s u re requirements of the local patent rules mandate the provision of specific factual and th e o re tic a l disclosures by both sides in short order. As noted in the counterclaim discussion a b o v e, Elan is put on notice of Lupin's defenses and suffers no strategic disadvantage by not o b ta in i n g a more detailed answer. There is no basis to grant Elan's motion to strike at such an e a rly stage of this litigation.8

In the District of Nevada, no local patent rules have been published. District of Nevada Lo c a l Rules, http://www.nvd.uscourts.gov/LocalRules.aspx (Last visited March 31, 2010).
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Lupin alleges nine separate defenses.

In its opposition to Plaintiffs' motion, Lupin contends that Elan should have moved for a more definite statement under Federal Rule of Civil Procedure 12(e), before moving to dismiss u n d e r Rule 12(b)(6). This argument is without merit. Lupin does not cite to a rule or any case la w for this proposition. A Rule 12(e) motion establishes that "[i]f a pleading to which a re s p o n siv e pleading is permitted is so vague or ambiguous that a party cannot reasonably be re q u ire d to frame a responsive pleading, the party may move for a more definitive statement b e fo re interposing a responsive pleading." Fed. R. Civ. P. 12(e). These motions are "directed to the rare case where because of the vagueness or ambiguity o f the pleading the answering party will not be able to frame a responsive pleading" Schaedler v.

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E q u a l ly important, this Court cannot determine that these defenses could not succeed as a m a t t e r of law or that Lupin is not entitled to relief. The inability to reach this determination is in e s s e n c e , the death knell of Elan's motion to strike. C O N C L U SIO N B a s e d on the foregoing, Plaintiff's motion to dismiss defendant's counterclaims, pursuant to Federal Rule of Civil Procedure 12(b)(6), and Plaintiff's motion to strike certain defenses, p u rs u a n t to Federal Rule of Civil Procedure 12(f), are denied, without prejudice. Lupin's motion t o amend is denied, as moot.

S/Joseph A. Greenaway, Jr. JOSEPH A. GREENAWAY, JR., U.S.C.J. ( S i t t in g by designation on the District Court) D a te : March 31, 2010

Eagle Publications, Inc., 370 F.2d 795, 798 (3d Cir. 1967); see also Pitcavage v. Mastercraft Boat C o ., 632 F. Supp. 842, 850 (M.D. Pa. 1985) ([M]otions for more definite statements are not v i e w e d with favor and are to be granted only if the allegations contained in the pleading are so v a gu e that defendant cannot reasonably be expected to frame a response to it.) However, when a R u l e 12(b)(6) motion is filed, the sufficiency of a complaint's allegations are tested. Viola v. V illa ge of Throop, Civ. Action No. 06-1930, 2007 U.S. Dist. LEXIS 56181 at *5 (M.D. Pa. A u g u s t 2, 2007). The issue is whether the facts alleged in the complaint, if true, support a claim u p o n which relief can be granted. Id. This Court has not identified any requirement under the F e d e r a l Rules of Civil Procedure that a party must first move under Rule 12(e) for a more definite s ta te m e n t before moving to dismiss under Rule 12(b)(6).

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