Ferring Pharmaceuticals Inc. et al v. Serenity Pharmaceuticals, LLC et al

Filing 488

OPINION AND ORDER re: 343 MOTION to Preclude Ferring from presenting argument or evidence directed to untimely dislcosed claim construction positions and to impose sanctions for deposition misconduct, filed by Reprise Biopharmaceut ics, LLC, Serenity Pharmaceuticals, LLC, Avadel Specialy Pharmaceuticals, LLC. For the foregoing reasons, Counterclaimants' motion (ECF No. 343) is DENIED. Within 30 days of the date of this Order, Dr. Dressman shall be made available by Ferring for a continued deposition not to exceed two hours. SO ORDERED. (Signed by Magistrate Judge Stewart D. Aaron on 4/24/2019) (kl)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
Ferring Pharmaceuticals Inc. et al.,
Plaintiffs,
-against-

04/24/2019
1:17-cv-09922 (CM) (SDA)
OPINION AND ORDER

Serenity Pharmaceuticals, LLC et al.,
Defendants.
STEWART D. AARON, United States Magistrate Judge:
Defendants/Counterclaim-Plaintiffs Serenity Pharmaceuticals, LLC (“Serenity”), Reprise
Biopharmaceutics, LLC (“Reprise”) and Avadel Specialty Pharmaceuticals, LLC (“Avadel”)
(collectively, “Counterclaimants”) move to preclude Plaintiffs Ferring Pharmaceuticals Inc.,
Ferring B.V. and Ferring International Center S.A. (collectively, “Ferring”) from presenting
argument or evidence directed to certain claim construction positions, and move for sanctions
against Ferring due to alleged deposition misconduct. (Not. of Mot., ECF No. 343.) For the
following reasons, the Court DENIES Counterclaimants’ motion but awards the relief set forth
herein. 1
1

I have the authority to decide this motion via Opinion and Order rather than issuing a Report and
Recommendation to Chief Judge McMahon. Pretrial matters “not dispositive of a party’s claim or defense”
may be referred to a Magistrate Judge for hearing and decision, subject to review by the District Judge on
a “clearly erroneous” or “contrary to law” standard if a party files timely objections. Fed. R. Civ. P. 72(a);
see also 28 U.S.C. § 636(b)(1)(A). Motions like the one before the Court seeking preclusion sanctions “are
ordinarily considered non-dispositive, and therefore fall within the grant of Rule 72(a), unless the sanction
employed disposes of a claim.” See Seena Int’l, Inc. v. One Step Up, Ltd., No. 15-CV-01095 (PKC) (BCM),
2016 WL 2865350, at *10 (S.D.N.Y. May 11, 2016) (internal quotation and citation omitted). “The critical
issue . . . is what sanction the magistrate judge actually imposes,” not what sanction the moving party
seeks. 12 Charles Alan Wright, Arthur R. Miller & Richard L. Marcus, Federal Practice and Procedure §
3068.2, at 383 (3d ed. 2014). Thus, “[i]f a moving party requests a dispositive sanction, but the magistrate
judge declines to impose it, the judge’s decision is governed by Rule 72(a),” and may be modified or set
aside only if “clearly erroneous or contrary to law.” Steele v. Costco Wholesale Corp., No. 03-CV-0713 (NG)

BACKGROUND
This is an action for declaratory judgment by Ferring against two entities formed by Dr.
Seymour Fein — Serenity and Reprise — seeking a declaration that certain of Dr. Fein’s patents
are invalid and unenforceable, and that they are not infringed by Ferring’s product NOCDURNA,
which is a product for the treatment of nocturia. 2 Counterclaimants have asserted counterclaims
against Ferring for patent infringement. 3
On December 1, 2018, at the deposition of Ferring’s expert, Dr. Jennifer Dressman,
counsel for Ferring instructed Dr. Dressman not to answer certain questions (and Dr. Dressman
herself refused to answer certain questions). (See, e.g., 12/1/18 Tr., Hartnett Decl., Ex. I, ECF No.
345-9, at 166-69, 209-10.) 4 According to Counterclaimants, the questions that Dr. Dressman was
directed not to answer related to certain claim construction positions belatedly taken by Ferring.
(Counterclaimants’ Mem., ECF No. 344, at 7-11.) Ferring argues in opposition that the limitations
on the scope of Dr. Dressman’s deposition were consistent with an agreement between the
parties that Defendants “will be barred from seeking testimony from” Dr. Dressman “that could
have reasonably been asked” during an earlier deposition of Dr. Dressman in September 2018.
(September 17, 2018 Ltr., Attaway Decl., Ex. B, ECF No. 383-2, at 2; see also Opp. Mem., ECF No.
382, at 7-8.) Counterclaimants dispute that there was any agreement as to the scope of Dr.

(MDG), 2005 WL 1068137, at *2 (E.D.N.Y. May 6, 2005). Because I have determined not to impose
sanctions, I have the authority to decide Defendants’ motion pursuant to Rule 72(a) and § 636(b)(1)(A),
and I need not proceed by way of a Report and Recommendation.
2

“Nocturia” is “urinary frequency at night.” Dorland's Illustrated Medical Dictionary 1279 (32nd ed. 2012).

3

Reprise asserts that it is the owner of the two patents that allegedly are infringed; Serenity asserts that
it is the exclusive licensee of such patents; and Avadel asserts that it is the exclusive sublicensee of such
patents.
4

The December 1, 2018 transcript of Dr. Dressman’s deposition has been filed under seal.

2

Dressman’s deposition and assert that, in any event, they were “not barred from asking questions
on brand new positions and evidence that came to light after Dr. Dressman’s earlier September
deposition.” (Reply, ECF No. 400, at 7-8.)
Counterclaimants move for the following relief: “(1) under Federal Rule of Civil Procedure
16(f) to preclude Ferring from presenting argument or evidence directed to untimely disclosed
claim construction positions; and (2) pursuant to 28 U.S.C. § 1927 to impose sanctions on Ferring
for deposition misconduct.” (Not. of Mot. at 2.)
DISCUSSION
I.

Legal Standards
A. Instructions Not To Answer At A Deposition
The Federal Rules of Evidence govern the conduct of a deposition. See Fed. R. Civ. P.

30(c)(1) (“The examination and cross-examination of a deponent proceed as they would at trial
under the Federal Rules of Evidence . . .”). Unlike trial testimony, however, upon an objection by
counsel, “the examination still proceeds” and “the testimony is taken subject to any objection.”
Fed. R. Civ. P. 30(c)(2). “A person may instruct a deponent not to answer only when necessary to
preserve a privilege, to enforce a limitation ordered by the court, or to present a motion under
Rule 30(d)(3).” Fed. R. Civ. P. 30 (c)(2) (emphasis added); see Law Firm of Omar T. Mohammedi,
LLC v. Computer Assisted Practice Elec. Mgmt. Sols., No. 17-CV-04567 (ER) (HBP), 2018 WL
5016605, at *2 (S.D.N.Y. Oct. 16, 2018); City of Almaty, Kazakhstan v. Ablyazov, No. 15-CV-05345
(AJN) (KHP), 2017 WL 9771809, at *3 (S.D.N.Y. July 28, 2017).

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B. Preclusion As Sanction
Movants seek relief under Rule 16(f) of the Federal Rules of Civil Procedure. Rule
16(f)(1)(C) provides: “[o]n motion or on its own, the court may issue any just orders, including
those authorized by Rule 37(b)(2)(A)(ii)-(vii), if a party . . . fails to obey a scheduling or other
pretrial order.” Fed. R. Civ. P. 16(f)(1)(C). The same standards that apply for the imposition of
discovery sanctions apply for the imposition of sanctions under Rule 16(f), cf. McNair v. Ponte,
No. 16-CV-01722 (LAP), 2019 WL 1428349, at *5 (S.D.N.Y. Mar. 29, 2019), particularly where (as
here) the alleged misconduct occurred during the discovery process.
“[B]ecause of the harshness of the sanction of preclusion, such a sanction has been held
to be justified only in ‘rare situations’ evincing culpable conduct by the party against whom the
sanction is to be imposed.” Scantibodies Lab., Inc. v. Church & Dwight Co., No. 14-CV-02275 (JGK)
(DF), 2016 WL 11271874, at *33 (S.D.N.Y. Nov. 4, 2016), report and recommendation adopted,
2017 WL 605303 (S.D.N.Y. Feb. 15, 2017) (citation omitted). Therefore, “before precluding a party
from introducing relevant evidence because of a discovery violation, a court should inquire more
fully into the actual difficulties which the violation causes, and must consider less drastic
responses.” Id. (internal quotation marks and citation omitted). In determining whether
preclusion is appropriate, courts should consider, inter alia: “(1) the party’s explanation for the
failure to comply with the discovery [requirement]; (2) the importance of . . . the precluded
[evidence]; (3) the prejudice suffered by the opposing party as a result of having to prepare to
meet the new testimony; and (4) the possibility of a continuance.” Id. at *34 (citing Softel, Inc. v.
Dragon Med. & Sci. Commc’ns, Inc., 118 F.3d 955, 961 (2d Cir. 1997)).

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C. Sanctions Under 28 U.S.C. § 1927
28 U.S.C. § 1927 provides that “[a]ny attorney . . . who so multiplies the proceedings in
any case unreasonably and vexatiously may be required by the court to satisfy personally the
excess costs, expenses, and attorneys’ fees reasonably incurred because of such conduct.” To
impose sanctions under this provision, “a court must find clear evidence that (1) the offending
party’s claims were entirely without color, and (2) the claims were brought in bad faith—that is,
motivated by improper purposes such as harassment or delay.” Kim v. Kimm, 884 F.3d 98, 106
(2d Cir. 2018) (internal quotation marks and citation omitted).
II.

Application
The Court finds that Ferring acted improperly in instructing Dr. Dressman not to answer

certain questions. Rule 29 of the Federal Rules of Civil Procedure permits the parties to enter into
stipulations to limit discovery. However, the record does not indicate that the parties entered
into a stipulation here. A “stipulation” is “any agreement made by the attorney engaged on
opposite sides of a cause (especially if in writing), regulating any matter incidental to the
proceedings or trial, which falls within their jurisdiction.” Black’s Law Dictionary 1427 (Deluxe 7th
Ed. 1999). In the present case, Ferring points to a September 17, 2018 letter it sent to
Counterclaimants’ counsel setting forth a limitation on the scope of Dr. Dressman’s deposition
testimony (Attaway Decl., Ex. B), but provides no written confirmation of agreement from
Counterclaimants of that limitation. 5 Thus, there does not appear to have been any agreement,
nor a meeting of the minds necessary for an agreement, to have been reached.

5

In the Opposition Memorandum, Ferring asserts cites to two pages of the December 1, 2018 deposition
transcript (pp. 209-10) for the proposition that Counterclaimants “recognized that they were bound by
[the] agreement” contained in the September 17, 2018 letter. (Opp. Mem. at 8.) The Court has reviewed

5

In any event, even assuming arguendo that the parties had reached agreement on limiting
the scope of Dr. Dressman’s continued deposition, Ferring’s instructions to Dr. Dressman not to
answer deposition questions were improper, because the record before the Court is ambiguous
as to whether the questions asked by Counterclaimants’ counsel could have been reasonably
asked at the September deposition. Ferring’s counsel should have merely noted any objection,
rather than instructing Dr. Dressman not to answer.
However, the drastic prelusion remedy sought by Counterclaimants for Ferring’s
discovery misconduct is not warranted. Instead, the Court hereby orders that, within 30 days of
the date of this Order, Ferring shall make Dr. Dressman available for a continued deposition not
to exceed two hours, so that Counterclaimants may ask the questions they were prevented from
asking on December 1, 2018. This will alleviate any prejudice suffered by Counterclaimants due
to Ferring’s deposition misconduct, because Counterclaimants will have the opportunity to
obtain answers to the deposition questions that went unanswered.6
Finally, because I do not find bad faith on the part of Ferring, I decline to award monetary
sanctions against Ferring under 28 U.S.C. § 1927.

the two pages cited and does not find evidence of Counterclaimants’ agreement to be bound by any
limitations to the scope of Dr. Dressman’s deposition.
6

This Opinion and Order does not address the issue of whether Ferring’s claim construction position was
fully and timely disclosed or whether Ferring should be precluded from offering any argument or
testimony at trial directed to its construction for the transmucosal claim limitations. Such issues may be
presented to Chief Judge McMahon at the appropriate time consistent with her Individual Rules.

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CONCLUSION
For the foregoing reasons, Counterclaimants’ motion (ECF No. 343) is DENIED. Within 30
days of the date of this Order, Dr. Dressman shall be made available by Ferring for a continued
deposition not to exceed two hours.
Dated: New York, New York
April 24, 2019

SO ORDERED.
________________________________
STEWART D. AARON
United States Magistrate Judge

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