ASTRAZENECA AB et al v. DR. REDDY'S LABORATORIES INC. et al

Filing 134

MEMORANDUM OPINION AND ORDER denying 98 Motion for Leave to File Amended Responses to DRLs Invalidity Contentions; Ordering that a telephone status conference, to be initiated by counsel for Plaintiffs is scheduled for 3/26/2103 at 11:30 AM. Signed by Magistrate Judge Douglas E. Arpert on 3/18/2013. (eaj)

UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
ASTRAZENECA AB, ASTRAZENECA :
LP, KBI-E, INC., and POZEN INC.,
:
:
Plaintiffs,
:
:
v.
:
:
DR. REDDY’S LABORATORIES INC. :
And DR. REDDY’S LABORATORIES :
LTD.,
:
:
and
:
:
LUPIN LTD. and LUPIN
:
PHARMACEUTICALS INC.
:
:
and
:
:
ANCHEN PHARMACEUTICALS,
:
INC.
:
:
Defendants.
:
___________________________________ :

Civil Action No. 11-2317 (JAP)

MEMORANDUM OPINION AND
ORDER

This matter comes before the Court on Plaintiffs AstraZeneca AB, AstraZeneca LP, KBIE, Inc. (collectively, “AstraZeneca”) and Pozen Inc.’s (“Pozen”) Motion for Leave to Amend
Responses to Defendants’ Invalidity Contentions [dkt. no. 98]. Defendants Dr. Reddy’s
Laboratories, Inc. and Dr. Reddy’s Laboratories Ltd. (collectively, “DRL”) filed Opposition [dkt.
no. 116] and Plaintiffs have replied [dkt. no. 125]. The Court granted DRL leave to submit a SurReply and DRL did so [dkt. no. 127]. The Court has considered all of the submissions of the
Parties pursuant to FED. R. CIV. P. 78 and, for the reasons set forth below, Plaintiffs’ Motion is
DENIED.

I.

INTRODUCTION
This Hatch-Waxman case was commenced on April 21, 2011. Plaintiffs allege that

Defendants infringed one Pozen patent (U.S. Patent 6,926,907—“the ‘907 patent”) and five
AstraZeneca patents (not at issue in the instant Motion) by filing Abbreviated New Drug
Application No. 202461 (“DRL’s ANDA”) with the U.S. Food and Drug Administration
(“FDA”). See generally Pl.’s Complaint. DRL’s ANDA seeks approval to market a generic
version of AstraZeneca’s VIMOVO® drug prior to the expiration of Plaintiffs’ patents. Id.
DRL is the first ANDA filer for any generic VIMOVO® product. Id. Lupin Ltd. and
Lupin Pharmaceuticals, Inc. (“Lupin”) and Achen Pharmaceuticals, Inc. (“Achen”) separately
filed later, discrete ANDAs for their own generic VIMOVO® products. Id. The Court has
consolidated Plaintiffs’ cases against DRL, Lupin and Anchen for discovery purposes only. See
dkt. nos. 41 and 82.
A.

The ‘907 Patent

Plaintiffs seek leave to amend their responses with regard to the ‘907 patent only. The
‘907 patent has 55 claims. On November 17, 2011, Plaintiffs served their Disclosure of Asserted
Claims pursuant to L. Pat. R. 3.6(b). Plaintiffs asserted that DRL infringed 21 claims of the ‘907
patent (i.e., claims 1, 5, 9-17, 22, 23, 35, 48 and 50-55). In their November 23, 2012 Invalidity
Contentions, DRL contended that each of the 21 asserted claims were invalid. DRL also
addressed each of the remaining 34 claims of the ‘907 patent. In their January 17, 2012
Responses to DRL’s Invalidity Contentions, Plaintiffs responded to DRL’s contentions for six of
the 21 asserted claims (i.e., claims 5, 15, and 52-55) of the ‘907 patent. Subsequently, Plaintiffs
further narrowed their asserted claims of the ‘907 patent to claims 5, 15, 52, 53, and 54. DRL

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thereafter informed Plaintiffs they would only contest the validity of the five claims that
remained and withdrew their invalidity contentions as to the other claims. See Def.’s Opp. at 8.
As a result of DRL’s Opposition to the instant Motion, Plaintiffs introduced new
“compromise” amended responses in their Reply. These new responses purport to address only
claims 5, 15, 52, 53, and 54.1
II.

ARGUMENT
Plaintiffs advance two primary arguments in support of their Motion. First, Plaintiffs

claim they should be granted leave to amend in order to correct an “oversight” by prior counsel.
Pl.’s Br. at 3; Pl.’s Reply at 3-4. According to Plaintiffs, primary responsibility for litigating each
of the six patents-in-suit was previously divided between two law firms, with prior counsel
taking the lead on the ‘907 patent. Pl.’s Br. at 3. On July 26 and 27, 2012, prior counsel
withdrew. At that time, Plaintiffs’ current counsel assumed primary responsibility for the ‘907
patent. Id. Plaintiffs now claim they should be granted leave in order to correct “omissions” and
“oversights” by prior counsel in the previously submitted responses.2 Id; Pl.’s Reply at 3-4. DRL
claims this argument is moot because it withdrew its invalidity contentions for all claims except
those already contested and responded-to claims 5, 15, 52, 53 and 54. Def.’s Opp. at 8.
Plaintiffs also argue that they should be permitted to amend their responses to complete
the “housekeeping” task of ensuring that their responses are “complete and in line with what has

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DRL nonetheless claims that Plaintiffs’ compromise contentions still assert validity arguments
for non-asserted claims 1, 9-17, 22, 23, 35, 48, 50, 51, and 55. Def.’s Sur-Reply at 4 (citing
Plaintiffs’ Reply Redline, dkt. no. 125-2, at Stout Decl., Ex. A). Because Plaintiffs’ Motion is
denied, this issue is moot.
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Plaintiffs original Memo argued that leave should be granted to correct inadvertent omissions
with regard to the 15 claims for which invalidity was asserted by DRL, but not addressed by
Plaintiffs’ original response. Pl.’s Br. at 5. These 15 claims were later conceded by Plaintiffs. See
Pl.’s Reply at 1. This argument was, in turn, adapted to support Plaintiffs’ position that they
should be permitted leave to amend with regard to the five contested claims.
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already been filed in the consolidated litigations.” Pl.’s Br. at 4. For reasons more fully outlined
below, DRL vehemently contests this justification. See Def.’s Opp. at 8-11.
III.

DISCUSSION
A.

Legal Standard

The Local Patent Rules “exist to further the goal of full, timely discovery and provide all
parties with adequate notice and information with which to litigate their cases.” Computer
Accelerations Corp. v. Microsoft Corp., 503 F.Supp.2d 819, 822 (E.D.Tex. 2007). The rules are
designed specifically to “require parties to crystallize their theories of the case early in litigation
and to adhere to those theories once they have been disclosed.” Atmel Corp. v. Info. Storage
Devices, Inc., 1998 WL 775115, at *2 (N.D. Cal. Nov. 5, 1998). This is “to ‘prevent the ‘shifting
sands’ approach to claim construction.’” O2 Micro Int'l Ltd. v. Monolithic Power Sys., Inc., 467
F.3d 1355, 1364 (Fed. Cir. 2006) (citing Atmel, 1998 WL 775115, at *2). As distinguished from
the liberal standard for amending pleadings, “the philosophy behind amending claim charts is
decidedly conservative.”

Atmel, 1998 WL 775115, at *2.

However, Rule 3.7 “is not a

straitjacket into which litigants are locked from the moment their contentions are served”;
instead, “a modest degree of flexibility [exists], at least near the outset.”

Comcast Cable

Communs. Corp. v. Finisar Corp., 2007 WL716131, at *2 (N.D. Cal. March 2, 2007). Therefore,
while “preliminary infringement contentions are still preliminary” it is important to recognize
that the Local Patent Rules strive to have the parties establish their contentions early on. General
Atomics v. Axis-Shield ASA, 2006 WL 2329464, at *2 (N.D.Cal. Aug. 9, 2006).
Pursuant to L. Pat. R. 3.7, leave to amend responses to invalidity contentions may be
granted “only by order of the Court upon a timely application and showing of good cause.”

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(emphasis added). Rule 3.7 provides a nonexhaustive list of circumstances that may, absent
undue prejudice to the adverse party, support a finding of good cause:
(a) a claim construction by the Court different from that proposed
by the party seeking amendment; (b) recent discovery of material
prior art despite earlier diligent search; (c) recent discovery of
nonpublic information about the Accused Instrumentality which
was not discovered, despite diligent efforts, before the service of
the Infringement Contention; (d) disclosure of an infringement
contention by a Hatch- Waxman Act party asserting infringement
under L. Pat. R. 3.6(g) that requires response by the adverse party
because it was not previously presented or reasonably anticipated;
and (e) consent by the parties in interest to the amendment and a
showing that it will not lead to an enlargement of time or impact
other scheduled deadlines . . .
L. Pat. R. 3.7. Good cause “considers first whether the moving party was diligent in amending its
contentions and then whether the non-moving party would suffer prejudice if the motion to
amend were granted.” Acer, Inc. v. Tech. Prob. Ltd., 2010 WL 3618687, at *3 (N.D. Cal. Sept.
10, 2010) (citing O2 Micro, 467 F.3d 1355, 1355). Importantly, however, the Court may only
consider prejudice to the non-moving party if the moving party is able to demonstrate diligence.
Apple v. Samsung, 2012 U.S. Dist. LEXIS 83115, at *13 (N.D. Cal. Mar. 27, 2012) (collecting
cases).
In determining whether good cause exists, courts have also considered such other factors
as (1) the reason for the delay, including whether it was within the reasonable control of the party
responsible for it; (2) the importance of what is to be excluded; (3) the danger of unfair
prejudice; and (4) the availability of a continuance and the potential impact of a delay on judicial
proceedings. See Oy Ajat, Ltd. v. Vatech Am., Inc., 2012 WL 1067900, at *20-21 (D.N.J. Mar.
29, 2012) (collecting cases); see also Computer Acceleration Corp. v. Microsoft Corp., 503 F.
Supp. 2d 819, 822 (E.D. Tex. 2007) (collecting cases).

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B.

Diligence

Courts have understood diligence to require a “showing that the party seeking leave to
amend acted . . . promptly [in] moving to amend when new evidence is revealed in discovery.”
O2 Micro, 467 F. 3d 1355, 1363, 1366 (collecting cases). This requirement is consistent with L.
Pat. Rule 3.7’s requirement that the Motion be “timely.” As with good cause in general, the
burden “is on the movant to establish diligence rather than on the opposing party to establish lack
of diligence.” O2 Micro, 467 F. 3d 1355, 1366. For the reasons discussed below, the Court finds
that Plaintiffs were not diligent in moving to amend.3
1.

Prior Counsel’s Withdrawal

Plaintiffs argue first that withdrawal of prior counsel provides good cause to amend. This
argument is not persuasive. Plaintiffs submitted their original responses on January 17, 2012—
nearly seven months before filing the instant Motion to Amend. Although Plaintiffs claim, and
the Court does not dispute, that the ‘907 patent was previously handled by prior counsel, the
January 17th responses were nonetheless served by the same firm which filed the instant Motion.
And Plaintiffs’ ‘of counsel’ attorneys from three large, reputable firms also signed both the
January 17th responses as well as the instant Motion. Thus, with the exception of prior counsel,
the attorneys involved in Plaintiffs’ original responses and Plaintiffs’ current Motion to Amend
are the same. Given the sophistication and number of attorneys involved, the Court is not
persuaded that Plaintiffs were diligent in either discovering prior errors or omissions, or moving
to amend their responses until seven months after they were first submitted.

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Plaintiffs contend, inter alia, that their Motion should be granted because “DRL’s [Opposition]
fails to demonstrate untimeliness or a lack of good cause.” Pl.’s Reply at 2. However, it is
Plaintiffs—not DRL—who must carry this burden.
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a.

Oversights & Omissions

The Court would reach the same conclusion even if it accepted Plaintiffs’ position that
the proposed amendments are intended to correct oversights or genuine errors. Plaintiffs are
correct in noting that this Court has granted leave to amend infringement contentions to correct
inadvertent omissions. However, the case cited by Plaintiffs, TFH Publications, Inc. v. Doskocil
Mfg. Co., Inc., 705 F. Supp. 2d 361 (D.N.J. 2010), is inapposite. In that case, plaintiff TFH
moved to amend its infringement contentions within two months of filing their initial
contentions. Id. at 363. Here, Plaintiffs waited seven months. The length and nature of Plaintiffs’
proposed amendments, moreover, do not suggest inadvertent omission. To the contrary, they are
more in line with changes that reflect a shift in theory or position by Plaintiffs. Still, even if the
amendment were provoked by genuine errors or omission, Plaintiffs cite no case which allows
for amendment after a similar period of time has passed.
The procedural posture in TFH was also significantly different. In noting that that case
was still in its relatively early stages, this Court explained, “Local Patent Rule disclosures are in
their infancy, discovery demands have not yet [been] exchanged, Markman briefing is months
away and scheduling of the Markman hearing will not even be discussed [for another 4
months].” Id. at 366. In this case, conversely, disclosures have long been served, Markman
briefing is complete, and a Markman hearing took place on December 19, 2012. Therefore,
unlike TFH, this case is no longer in its early stages.
Finally, Plaintiffs’ argument that the amendments are necessary to correct inadvertent
errors or omissions would appear to be at odds with the amended responses’ citations to recent

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deposition discovery.4 After all, the original contentions were drafted nearly six months before
Dr. Horn’s deposition. For all of the reasons discussed above, Plaintiffs have failed to
demonstrate, and the Court does not find any omission or error which would provide good cause
to amend.
2.

Consolidation

Plaintiffs next argue that they should be permitted to amend their Responses in order to
bring them in line with the other two defendants, Lupin and Anchen, in these consolidated
actions. This is not the purpose or function of consolidation. Instead, “consolidation is permitted
as a matter of convenience and economy in administration, but does not merge the suits into a
single cause, or change the rights of the parties, or make those who are parties in one suit parties
in another.” Johnson v. Manhattan Ry. Co., 289 U.S. 479, 496-97 (1933). As the Third Circuit
has recognized, “Johnson remains the ‘authoritative’ statement on the law of consolidation.”
Cella v. Togum Constructeur Ensembleier en Industrie Alimentaire, 173 F.3d 909, 912 (3d Cir.
1999) (citation omitted). Here, the cases were consolidated for discovery purposes only. The law
is well-settled on this issue and Plaintiffs cite no authority to advance their contrary proposition.
Plaintiffs, therefore, may not amend their responses simply to promote uniformity among the
consolidated actions.
C.

Prejudice

In deciding whether Plaintiffs’ proposed amendments would unfairly prejudice DRL, the
Court considers whether permitting the proposed amendments would (1) require DRL to expend

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In a footnote, Plaintiffs argue that they should be permitted to amend their Responses in order
to disclose additional factual support for their validity positions in light of the deposition of Dr.
John Horn, DRL and Lupin’s shared expert. Pl.’s Reply at 2-3. This deposition took place on
June 14, 2012. Id. at 2.
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significant additional resources; or (2) significantly delay the resolution of the dispute. See TFH
Publications, Inc. v. Doskocil Mfg. Co., Inc., 705 F. Supp. 2d 361, 366 (D.N.J. 2010). Because
the Court finds that Plaintiffs were not diligent in moving to amend, it need not—and, indeed,
should not—consider prejudice at all. See O2 Micro Int'l Ltd. v. Monolithic Power Sys., Inc.,
467 F.3d 1355, 1368 (Fed. Cir. 2006). Nevertheless, several factors suggest prejudice to DRL.
First, the amended contentions consist of 15 pages of new material which DRL claims
include “entirely new validity theories, a plethora of new references, as well as myriad citations
to the June 14, 2012 deposition transcript of Dr. John R. Horn . . . .” Def.’s Opp. at 9; see also
Def.’s Sur-Reply at 4-5. Plaintiffs do little to dispute this position other than note that such
amendments would not require a response by DRL. Technically, Plaintiffs are correct that no
such response is contemplated by the Local Rules. However, this point says nothing of the
additional resources DRL would need to expend in order to defend against the new theories and
defenses introduced by Plaintiffs; nor does it reassure DRL that its concerns are invalid or untrue.
Second, as noted above, this proceeding is no longer in its early stages. The Parties
completed claim construction discovery and briefing on September 27, 2012 and a Markman
hearing occurred on December 19, 2012. Because “the Local Patent Rules require parties to
crystallize their theories of the case early in litigation and to adhere to those theories once they
have been disclosed,” King Pharmaceuticals, Inc. v. Sandoz Inc., 2010 WL 2015258, at *4
(D.N.J. May 20, 2010), allowing amendment at this stage of the litigation would unfairly allow
Plaintiffs to amend their previously disclosed theories of infringement.

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IV.

CONCLUSION & ORDER
The Court has considered the papers submitted pursuant to FED. R. CIV. P. 78 and, for the

reasons set forth above,
IT IS on this 18th day of March, 2013,
ORDERED that Plaintiffs’ Motion for leave to file Amended Responses to DRL’s
Invalidity Contentions is DENIED; and it is further
ORDERED that a telephone status conference, to be initiated by counsel for Plaintiffs,
has been scheduled in this matter for March 26, 2013 at 11:30 A.M.

/s/ Douglas E. Arpert
DOUGLAS E. ARPERT
UNITED STATES MAGISTRATE JUDGE

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