JAZZ PHARMACEUTICALS, INC. v. ROXANE LABORATORIES, INC.

Filing 214

OPINION AND ORDER granting 188 Motion to Consolidate this case with Civil Nos. 12-6761 & 12-7459 for all purposes. Signed by Magistrate Judge Steven C. Mannion on 4/12/2013. (nr, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
NEWARK VICINAGE
NOT FOR PUBLICATION
JAZZ PHARMACEUTICALS, INC.,
Civil No. 10-6108-ES-SCM
Civil No. 12-6761-ES-SCM
Civil No. 12-7459-ES-SCM

Plaintiff,
v.

ORDER AND OPINION ON MOTION TO
CONSOLIDATE ACTIONS
ROXANE LABORATORIES, INC.,
[D.E. 188]
Defendant.

I.

INTRODUCTION
This matter comes before the Court on the motion of Plaintiff

Jazz Pharmaceuticals, Inc., (“Jazz”) to consolidate Jazz
Pharmaceuticals, Inc. v. Roxane Laboratories, Inc., Civil Action No.
10-6108 with Jazz Pharmaceuticals, Inc. v. Roxane Laboratories,
Inc., Civil Action No. 12-6761 and Jazz Pharmaceuticals, Inc. v.
Roxane Laboratories, Inc., Civil Action No. 12-7459.
Jazz’s Motion to Consolidate).

(See D.E. 188,

Defendant Roxane Laboratories,

Inc., (“Roxane”) opposes the motion.

For the reasons set forth

below, the Court will grant Plaintiff’s motion.
II.

BACKGROUND

This is an action for patent infringement arising from Roxane’s
filing of Abbreviated New Drug Application (“ANDA”) No. 202-090 with
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the U.S. Food and Drug Administration (“FDA”) seeking approval to
commercially market a generic version of Jazz’s drug product XYREM®
prior to the expiration of various patents owned by Jazz.1 XYREM® is
an oral solution containing the active pharmaceutical ingredient
sodium oxybate, and is marketed for the treatment of excessive
daytime sleepiness and cataplexy in patients with narcolepsy.”
D.E. 188-1, Jazz’s Brief in Support of Motion, at *5).

(See

Since Jazz

filed its initial Complaint in Civil Action No. 10-6108, two other
actions have been consolidated with the instant matter: Jazz
Pharmaceuticals, Inc. v. Roxane Laboratories, Inc., Civil Action No.
11-660; and Jazz Pharmaceuticals, Inc. v. Roxane Laboratories, Inc.,
Civil Action No. 11-2523.
All of the patents-in-suit, the ‘431, ‘889, ‘219, ‘506

1 Pursuant to the Drug Price Competition and Patent Term Restoration
Act, 21 U.S.C. § 301, et seq. (also known as the “Hatch-Waxman Act”),
a generic pharmaceutical manufacturer may seek expedited approval
to market a generic version of a previously approved drug by
submitting an ANDA to the FDA. See 21 U.S.C. § 355(j). Pursuant
to the Hatch-Waxman Act, an ANDA applicant must show that its generic
product is the equivalent of the previously approved drug, and for
each patent applicable to the previously approved drug the ANDA must
include a certification: (1) that such patent has not been filed (a
“Paragraph I” certification); (2) that such patent has expired (a
“Paragraph II” certification); (3) of the date on which such patent
will expire (a “Paragraph III” certification); or (4) that such
patent is invalid or will not be infringed by the manufacture, use,
or sale of the new drug for which the application is submitted (a
“Paragraph IV” certification). See 21 U.S.C. § 355(j)(2)(A)(vii).
The submission of an ANDA containing a Paragraph IV certification
constitutes a technical act of patent infringement. Eli Lilly and
Company v. Medtronic, Inc., 496 U.S. 661, 678 (1990).
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(together, “the ‘431 patent family”), as well as the ‘650 patent that
Jazz seeks to consolidate in the instant motion, contain claims
related to sodium oxybate, and methods of use and administration of
pharmaceutical compounds containing sodium oxybate.
188-1, Jazz’s Brief in Support of Motion).

(See D.E.

In seeking consolidation

of its lawsuit alleging infringement of the ‘650 patent with its
earlier filed lawsuits, Jazz contends that the ‘650 patent contains
claims that are substantially similar to the patents in the ‘431
patent family.

Id. at *5-8.

Accordingly, Jazz contends that there

exists common issues regarding infringement, and that the “same
questions concerning whether Roxane’s ANDA product meets the
limitations of the ‘431, ‘889, ‘219, and ‘506 patents also apply to
the ‘650 patent.”

See id. at *8.

Likewise, Jazz asserts that

Roxane’s allegations regarding the alleged invalidity of the claims
of the ‘431 patent family will involve largely the same evidence as
Roxane’s allegations concerning the ‘650 patent. Id. at *8-9.

In

light of this alleged overlap regarding infringement and invalidity
issues, as well as relevant evidence, Jazz asserts that consolidation
is appropriate. Id.
In contrast, Roxane contends that consolidation is
inappropriate because the claims of the patents within the ‘431
family are different from those of the ‘650 patent, and thus
consolidation would not streamline pretrial proceedings.
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(See D.E.

197, Roxane’s Brief in Opposition, at *1).

For instance, Roxane

asserts that even if the inventors named on the face of the ‘650 patent
are the same as those named on the other patents in the ‘431 family,
additional discovery on each of the named inventors of the ‘650 patent
may be necessary in light of issues specific to the ‘650 patent that
were not relevant in earlier depositions.

See id. at *6.

Furthermore, Roxane asserts that it will suffer prejudice if the two
pending actions are consolidated, as doing so will further postpone
the launch of its ANDA product.

Id.

Lastly, Jazz also seeks to consolidate Civil Action No. 12-7459,
a recently filed patent action for infringement of U.S. Patent No.
8,324,275 (the “’275 patent”).

According to Jazz, the ‘275 patent

was filed on April 13, 2012, and is a “continuation in the chain of
the ‘431 patent family.”
of Motion, at *11).

(See D.E. 188-1, Jazz’s Brief in Support

Jazz asserts that the claims of the ‘275 patent

are “substantially similar to the claims of the ‘506 patent
already-in-suit,” and that issues of law and fact concerning the
validity of ‘275 patent will be duplicative of issues already pending
in the current action.

Id.

Roxane has accepted service of the

Complaint in the ‘275 action and has agreed that, at a minimum, the
‘275 patent action should be consolidated with the ‘650 patent
action.

(See D.E. 197, Roxane’s Brief in Opposition, at *9).

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III. LEGAL STANDARD AND ANALYSIS
Pursuant to Fed. R. Civ. P. 42(a), consolidation may be
appropriate when actions “involve a common question of law or fact”.
“The purpose of consolidation is to streamline and economize pretrial
proceedings so as to avoid duplication of effort, and to prevent
conflicting outcomes in cases involving similar legal and factual
issues.”

In Re TMI Litig., 193 F.3d 613, 724 (3d Cir. 1999) (internal

citations omitted).

Under Rule 42(a) a District Court has broad

discretion in determining whether to consolidate cases, and in making
its decision,
the court must balance the risk of prejudice and
possible confusion against the risk of
inconsistent adjudications of common factual
and legal issues, the burden on the parties and
witnesses, the length of time required to
conclude multiple lawsuits as against a single
one, and the relative expense to all concerned
of the sing-trial and multiple-trial
alternatives.
A.F.I.K. Holding SPRL v. Fass, 216 F.R.D. 567, 570 (D.N.J. 2003)
(internal citations omitted).

Thus, a court’s decision regarding

consolidation is highly contextual, as a district court must consider
the particular facts and circumstances of each individual case.

See

In Re Cent. European Distrib. Corp., 2012 U.S. Dist. LEXIS 160248,
at *23 (D.N.J. Nov. 8, 2012) (citing Wright & Miller § 2383).
After considering the parties’ submissions and all other
relevant factors in this matter, the Court, in its discretion, will
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grant Jazz’s motion to consolidate.

First, the Court notes that the

parties in these two actions are identical.

Second, many issues

pertaining to infringement are shared between the ‘605 patent and
the patents of the ‘431 patent family, such as pH, microbial
resistance, and chemical stability.

As Jazz notes in its moving

papers, “six of the nine references cited in Roxane’s notice letter
of its Paragraph IV Certification concerning the alleged invalidity
of the ‘650 patent have already been cited by Roxane in its invalidity
contentions in the earlier-filed case.”
Brief in Support of Motion, at *8).

(See D.E. 188-1, Jazz’s

Accordingly, a finding of

infringement or non-infringement regarding the claims of the patents
of the ‘431 patent family would likely be repeated with regard to
the ‘605 patent, and it is likely that there will be considerable
overlap between the evidence used in both actions.

As such, it is

this Court’s determination that streamlining the two proceedings by
way of consolidation is appropriate at this time.
While some delay in the ‘650 patent proceedings may result from
consolidation, the Court finds that a balance of all relevant
considerations favors joining the two actions.

The two cases

clearly share significant common questions of law and fact.

Both

cases involve patents for sodium oxybate, and claims to methods of
using the pharmaceutical compositions to treat daytime sleepiness.
(See D.E. 188-1, Jazz’s Brief in Support, at *6).
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So, the Court finds

that there is substantial overlap among the patents that Roxane is
alleged to have infringed, and that consolidation is appropriate.
The Court acknowledges Roxane’s argument that there are
specific issues and defenses relating to the ‘650 patent that may
be distinguished from those that pertain to the ‘431 patent family
patents, such as the defense of inequitable conduct.
Roxane’s Brief in Opposition, at *6).

(See D.E. 197,

However, the Court notes that,

with regard to Roxane’s inequitable conduct defense, the ultimate
success of that defense is likely to hinge upon allegations of prior
art that Roxane has alleged in its invalidity defenses against the
‘431 patent family patents.2

See Therasense, Inc. v. Becton,

Dickinson and Co., 649 F.3d 1276, 1291-92 (Fed. Cir. 2011).

Further,

while Roxane asserts that it may face prejudice if it were forced
to delay the launch of its ANDA due to the threat of patent
infringement, the Court notes that the FDA has not yet granted final
approval of Roxane’s ANDA product.

(See D.E. 197, Roxane’s Brief

2 The court in Therasense noted, in discussing the materiality of
prior art needed for an inequitable conduct defense, that “the
materiality required to establish inequitable conduct is but-for
materiality.” 649 F.3d at 1291. Thus, prior art is but-for
material if “the PTO would not have allowed a claim if it had been
aware of the undisclosed reference.” Id. An exception to the
but-for materiality requirement exists in cases of affirmative
egregious misconduct, such as the filing of an unmistakably false
affidavit. Id. at 1292. In such cases, affirmative egregious
misconduct is deemed material. Id. The Court notes, however, that
mere nondisclosure of prior art references to the PTO, or failure
to mention prior art references in an affidavit, does not constitute
affirmative egregious misconduct. See id.
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in Opposition, at *7-8).

Additionally, even if litigation involving

the ‘431 patent family patents was resolved, litigation related to
the ‘650 patent would nevertheless remain pending.

Accordingly, it

is this Court’s determination that, under the present circumstances,
the possible risk of delay and prejudice that may result from
consolidation does not outweigh the benefit of joining the two
related actions, Civil Action Nos. 10-6108 and 12-6761.
Finally, the Court will consider Jazz’s request to also
consolidate the ‘275 patent action.
in Support of Motion, at *11-12).

(See D.E. 188-1, Jazz’s Brief

The parties agree that the newly

filed ‘275 patent action should be included in the event that this
Court grants Jazz’s motion to consolidate, as doing so will minimize
any additional delay and streamline the discovery process.

(See

id.; see also D.E. 197, Roxane’s Brief in Opposition, at *10).
Considering all of the above, and further noting that the ‘275 patent
action appears to share common issues of law and fact with the other
actions pending before this Court, the Court will grant the parties’
request to consolidate the ‘275 patent action with Civil Action No.
10-6108.
IV.

CONCLUSION

For all of the reasons above, the motion to consolidate is
GRANTED and Civil Action Nos. 10-6108, 12-6761, and 12-7459 shall
be consolidated for all purposes.
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IT IS ON THIS 8th day of April, 2012,
ORDERED that Civil Action Nos. 12-6761 and 12-7459 are hereby
consolidated with Civil Action No. 10-6108; and it further
ORDERED that the above captioned docket number, Civil Action
No. 10-6108-ES-SCM, will be the LEAD ACTION.

4/12/2013 10:00:58 AM

Date: April 12, 2013

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