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Hospira, Inc. v. Sandoz, Inc.

United States District Court, D. New Jersey

February 27, 2014

HOSPIRA, INC., et al., Plaintiffs,
v.
SANDOZ INC., et al., Defendants.

MEMORANDUM OPINION

MARY L. COOPER, District Judge.

THE PARTIES to this action jointly move pursuant to Federal Rule of Civil Procedure ("Rule") 60(b) to vacate the parts of this Court's opinion, and order and judgment, that declared a certain pharmaceutical patent to be invalid ("Motion to Vacate"). (See dkt. entry no. 404, Joint Notice of Mot.) A nonparty to this action, Caraco Pharmaceutical Laboratories, Ltd. ("CPL") cross-moves to permissibly intervene in this action pursuant to Rule 24(b), or alternatively for leave to file a brief as amicus curiae, in order to oppose the Motion to Vacate ("Cross Motion"). (See dkt. entry no. 410, CPL Notice of Cross Mot.) For the following reasons, the Court will grant the Motion to Vacate and deny the Cross Motion.

PLAINTIFFS, Hospira, Inc. and Orion Corporation, brought this action against Defendants, Sandoz Inc. and Sandoz Canada Inc., on September 4, 2009, alleging, inter alia, that Defendants infringed United States Patent No. 6, 716, 867 ("the '867 Patent"). (See dkt. entry no. 1, Compl.) A review of this Court's docket reveals that the dispute was actively litigated for 32 months until May 4, 2012, when this Court issued an opinion ("May 2012 Opinion") and an order and judgment ("May 2012 Judgment"), inter alia, finding in Defendants' favor that the '867 Patent was invalid. (See dkt. entry no. 381, 5-4-12 Am. J.; see also dkt. entry no. 380, 5-4-12 Am. Mem. Op.) Plaintiffs and Defendants separately appealed to the United States Court of Appeals for the Federal Circuit ("Federal Circuit") from the May 2012 Judgment. (See dkt. entry no. 385, Defs. Notice of Appeal; dkt. entry no. 386, Pls. Notice of Cross Appeal.)[1]

WHILE the entire dispute remained pending in the Federal Circuit, the parties (1) notified this Court on December 6, 2013, that the dispute insofar as it concerned the '867 Patent had been tentatively settled, and (2) sought an indicative ruling pursuant to Rule 62.1 that this Court would agree to vacate the parts of the May 2012 Opinion and the May 2012 Judgment concerning the '867 Patent as part of the settlement if the Federal Circuit remanded the action. (See dkt. entry no. 400, Notice of Mot.) On December 16, 2013, this Court advised the parties that it would indeed so vacate upon the Federal Circuit's remand. (See dkt. entry no. 402, 12-16-13 Order.)

BY AN ORDER dated December 23, 2013 ("12-23-13 Federal Circuit Order"), the Federal Circuit remanded "for the limited purpose of the district court's consideration of the parties' motion for vacatur", but stated that it "retain[ed] jurisdiction so that any of the parties may seek appellate review" and that "[t]he appeals are held in abeyance pending the resolution of the motion for vacatur by the district court". (See dkt. entry no. 410-7, 12-23-13 Fed. Cir. Order at 2.)

THE PARTIES jointly filed the Motion to Vacate on the same day that the 12-23-13 Federal Circuit Order was issued, arguing that:

the parties have independently reached a mutually agreed settlement in the appeal of the above-captioned case. The parties have independently determined that the public and private benefits of settlement are significant, and outweigh their respective opportunities to proceed with their important appellate rights.... Hospira has vigorously contested [this Court's] ruling [on the '867 Patent] before the Federal Circuit, but faced the risk that the Court's judgment will be affirmed and that [Defendants] could enter the market unimpaired. [Defendants], on the other hand, faced the risk that the Court's ruling will be reversed, possibly leading to an injunction through 2019, and exposure to damages if [they launch] while the appeal is pending. Informed in large part by their experience at the trial and their views of this Court's decision, the parties have now agreed that they and the public would be benefited by increased certainty, and accordingly, they have agreed that [Defendants] may launch [their] product on December 26, 2014, or even earlier in certain circumstances. That permits generic competition almost five years before [Defendants] could launch if the '867 patent were found valid.
The settlement balances the rights of both parties, preserving [Plaintiffs'] important rights inherent in patent ownership, while removing the possibility that [Defendants] would be enjoined from launching [their] product until the '867 patent expires. Both sides have independently assessed the risks of proceeding with their appeals and have reached what they believe to be an equitable settlement.

(Dkt. entry no. 404-1, Jt. Redacted Mem. of Law in Support of Mot. to Vacate at 5-6.)

CPL filed a letter on the same day, notifying this Court of its intention to seek intervention, as: (1) "Hospira sued [CPL] in the United States District Court for the Eastern District of Michigan (see Hospira, Inc. v. Caraco Pharms. Labs., Ltd., Case No. 10-14514 (E.D. Mich.)) [("Michigan Action")], in November 2010 alleging infringement of the '867 patent"; (2) "Hospira is barred by collateral estoppel from pursuing a claim of infringement of the '867 patent in light of this Court's '867 Patent Invalidity Judgment"; (3) "at the invitation of the Michigan district court, [CPL] submitted a motion for summary judgment based on collateral estoppel in view of [this Court's] '867 Patent Invalidity Judgment"; and (4) CPL "has a substantial interest in any decision this Court may reach regarding vacatur", as "[a]ny decision by this Court regarding vacatur will necessarily impact the Michigan [Action]". (Dkt. entry no. 407, 12-23-13 CPL Letter at 1-2.)

CPL followed by filing the cross motion on December 24, 2013. (See CPL Notice of Cross Mot.) In support, CPL stated that briefing for the aforementioned motion for summary judgment pending in the Michigan Action would be "close[d] on December 31, 2013". (Dkt. entry no. 410-1, CPL Br. in Support of Cross Mot. at 3.) CPL also filed separate opposition to the Motion to Vacate. (See dkt. entry no. 410-2, CPL Br. in Opp.) CPL asserts in the opposition brief that "[a]t present, the '867 patent stands invalid because of the Court's judgment." (Id. at 13.)

Plaintiffs have filed opposition to the Cross Motion. (See dkt. entry no. 411, Pls. Mem. in Opp.) They point out therein that CPL was well-aware of the pending appeal and agreed to stay the Michigan Action pending the outcome before the Federal Circuit. (See id. at 3.) The docket for the Michigan Action supports that contention. See Michigan Action, dkt. entry no. 56, 5-7-12 So-Ordered Stipulation (staying Michigan Action pending outcome of Federal Circuit appeal); dkt. entry no. 60, 5-24-13 Order Extending Stay. The stay in the Michigan Action apparently was eventually extinguished, even though the dispute addressed by this Court remained pending in the Federal Circuit.

WHETHER to permit CPL to intervene under Rule 24(b) is a matter of discretion for this Court. See Fed.R.Civ.P. 24(b)(3) (stating intervention determination is discretionary exercise). This Court initially finds that there is jurisdiction here, as (1) this is a patent dispute, and (2) the action has been remanded by the Federal Circuit. This Court also finds that the validity of the '867 Patent is at issue here and in the Michigan Action, and thus there is arguably a common question of law or fact. See Fed.R.Civ.P. 24(b)(1)(B).

BUT the Cross Motion insofar as it concerns intervention is not timely, as CPL should have sought to intervene earlier. See Fed.R.Civ.P. 24(b)(1) (stating court may permit intervention "[o]n timely motion"). CPL was neither thwarted nor lulled into complacency by Plaintiffs or Defendants. Cf. United States v. Alcan Aluminum , 25 F.3d 1174, 1181 (3d Cir. 1994) (stating movant timely sought intervention, even ...


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