Purdue Research v. Sanofi-Synthelabo, S.A.
| Decision Date | 04 August 2003 |
| Docket Number | No. 02-2655.,02-2655. |
| Citation | 338 F.3d 773 |
| Parties | PURDUE RESEARCH FOUNDATION, Plaintiff-Appellant, v. SANOFI-SYNTHELABO, S.A., Sanofi-Synthelabo, Incorporated, and STWB, Incorporated, Defendants-Appellees. |
| Court | U.S. Court of Appeals — Seventh Circuit |
William P. Kealey (Argued), Stuart & Branigin, Lafayette, IN, for Plaintiff-Appellant.
Thomas J. Meloro (Argued), Michael K. Levy, Kenyon & Kenyon, New York, NY, for Defendants-Appellees.
Before BAUER, RIPPLE and KANNE, Circuit Judges.
Purdue Research Foundation ("PRF"), an Indiana corporation with its principal place of business in West Lafayette, Indiana, filed this action for breach of contract in the Superior Court for Tippecanoe County, Indiana, against Sanofi-Synthelabo, S.A. ("SSBO France"), a French corporation with its principal place of business in Paris, France.1 PRF alleged that it was entitled to payments relating to the development of an antiviral drug, known as pleconaril, under a Cooperative Research Agreement that SSBO France had acquired from Sterling Winthrop, Inc. through an asset purchase agreement. Invoking the diversity jurisdiction of the district court, see 28 U.S.C. § 1332, SSBO France removed the case to the United States District Court for the Northern District of Indiana.2 The district court dismissed PRF's complaint against SSBO France for want of personal jurisdiction. For the reasons set forth in the following opinion, we affirm the judgment of the district court.
PRF is the contracting authority for all sponsored research undertaken at Purdue University. SSBO France is a French corporation in the business of developing, manufacturing and selling pharmaceuticals.
On December 1, 1987, PRF entered into a five-year Cooperative Research Agreement ("Agreement") with Sterling Drug, Inc. ("Sterling Drug") for the purpose of developing certain antiviral drugs.3 The Agreement acknowledged that Dr. Michael Rossmann and other Purdue scientists had been cooperating with Sterling scientists since January 1, 1986, that their research had led to an increased understanding of the interaction between certain viruses and antiviral agents, and that the parties desired to continue their relationship in order to further develop antiviral agents of interest to Sterling Drug. The Agreement obligated Sterling Drug to compensate PRF for product achievements related to the sponsored research.4
Under the Agreement, PRF and Sterling Drug agreed to share the cost of their collaborative research efforts, both contributing $50,000 for each of the five years. Sterling Drug further agreed to furnish Dr. Rossmann and his associates with adequate supplies of picornavirus and other viruses for research to be performed at Purdue University. In addition, both PRF and Sterling Drug agreed to provide the other with an annual written report summarizing the work carried out under the Agreement by Purdue scientists at the University and by Sterling scientists at Sterling's facilities. Sterling Drug also agreed to indemnify PRF for any liability arising from the manufacture, use, distribution or sale of products by Sterling Drug, its affiliates or licensees. The Agreement provided for the application of Indiana law, but it did not contain a choice of forum clause or a stipulation as to personal jurisdiction in Indiana. Also, the Agreement permitted Sterling Drug to assign the contract to any entity that succeeded to substantially all of Sterling Drug's ethical pharmaceutical business.
By its terms, the research component of the Agreement expired on December 1, 1992.5 During the period of the Agreement, PRF and Sterling Drug worked on and evaluated various antiviral chemical compounds. According to PRF, this research, which was conducted primarily in West Lafayette, Indiana, contributed to the development of pleconaril, an antiviral drug intended to treat the common cold. On September 20, 1994, Sterling Winthrop, Inc. ("Sterling Winthrop"), the successor to Sterling Drug, was granted a patent for the chemical compound known as pleconaril.6
In 1994, the intellectual property relating to Sterling Winthrop's ethical pharmaceutical business was purchased by Sanofi, S.A. ("Sanofi France"), a French corporation, and Sanofi Winthrop, Inc. ("Sanofi Winthrop"), a Delaware corporation and subsidiary of Sanofi France. Relevant to this lawsuit, Sanofi France took title to Sterling Winthrop's "pipeline and/or discovery products," which included the intellectual property relating to pleconaril. R.15 at ¶ 7. Sanofi Winthrop obtained title to a different class of Sterling Winthrop's intellectual property relating to "commercial products." Id. Sterling Winthrop's other assets, including intellectual property relating to different Sterling Winthrop operations, were purchased by companies other than Sanofi France and Sanofi Winthrop. See id.
In 1999, Sanofi France merged with Synthelabo, S.A., another French corporation, and became SSBO France. At the same time, Sanofi Winthrop became SSBO U.S. Following the merger, SSBO France retained all property rights in pleconaril. On February 27, 2001, SSBO France granted ViroPharma, Inc. ("ViroPharma"), a Delaware corporation with its principal place of business in Pennsylvania, an exclusive royalty-bearing license to develop, market and sell pleconaril throughout the United States and Canada. See R.21, Ex.G.7
In furtherance of the 1987 Cooperative Research Agreement, Sterling Drug regularly shipped research samples to Dr. Rossmann and his associates in Indiana for their analysis. Sterling Drug scientists and employees also made several visits to Purdue's campus in West Lafayette, Indiana, to discuss and evaluate the progress of PRF's research. In addition to physical visits by Sterling Drug personnel, Sterling Drug established and maintained ongoing communications with PRF through the use of mail, telephone, facsimile and other means. There is no evidence, however, that SSBO France, or its predecessor, Sanofi France, physically entered Indiana in furtherance of the Agreement or communicated with PRF about the Agreement in any way.
Although SSBO France is in the business of developing, manufacturing and selling pharmaceuticals, it performs none of these operations in the United States. The development, manufacture and sale of pharmaceuticals in the United States under the name of "Sanofi Synthelabo" is undertaken exclusively by SSBO U.S., a wholly-owned subsidiary of SSBO France. Other licensees of SSBO France, including ViroPharma, develop, manufacture and/or sell pharmaceuticals in the United States under the name of the individual licensee. SSBO France does not manufacture or sell any goods in Indiana, does not provide any services in Indiana, does not maintain any offices in Indiana, does not own any real property in Indiana, does not insure any risks located in Indiana and does not employ any persons in Indiana. SSBO France has executed several confidentiality agreements with Eli Lilly, Inc., an Indiana corporation with its principal place of business in Indianapolis, Indiana, but none of these agreements concern pleconaril.
On December 20, 2001, PRF filed this action for breach of contract in the Superior Court for Tippecanoe County, Indiana. PRF alleged that research conducted by Dr. Rossmann and other Purdue scientists under the PRF-Sterling Agreement contributed to the development of certain antiviral drugs, including pleconaril, for which Sterling and/or its successors had received commercial benefits, that SSBO France was the successor-in-interest to Sterling and/or had assumed its obligations under the Agreement, and that PRF was owed payments under the Agreement in connection with the development of pleconaril.8 On January 22, 2002, SSBO France removed the case to the United States District Court for the Northern District of Indiana; and, on February 14, 2002, it filed a motion to dismiss for lack of personal jurisdiction pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure.
On June 5, 2002, after the parties had conducted limited discovery relating to the jurisdictional issue, the district court dismissed PRF's complaint for lack of personal jurisdiction. The court first rejected PRF's argument that SSBO France is subject to specific jurisdiction in Indiana because, as Sterling's predecessor-in-interest, it is bound by Sterling's extensive contacts with Indiana in the formation and performance of the Agreement. See R.35 at 4. The court reasoned that, although personal jurisdiction may be imputed to a corporate successor in some instances, "when the predecessor and successor are parties to the assignment of a contract, the assignee does not automatically assume the assignor's contacts with the forum." Id. Because SSBO France purchased less than all of Sterling, the court concluded that it could not attribute Sterling's contacts to SSBO France. See id.
The district court then rejected PRF's argument that SSBO France's own contacts with Indiana are sufficient to establish the continuous and systematic contacts needed to confer general jurisdiction over SSBO France. See id. at 5. Finally, the court rejected PRF's argument that SSBO France is subject to personal jurisdiction under a stream of commerce theory. Because SSBO U.S. and other licensees of SSBO France are responsible for manufacturing and distributing the products that stem from SSBO France's patents in the United States, the court reasoned that SSBO France does not place any products into the stream of commerce and therefore the stream of commerce doctrine does not apply.
A district court sitting in diversity has personal jurisdiction over a nonresident defendant only if a court of the state in which it sits would have jurisdiction. See Hyatt Int'l Corp. v. Coco, 302 F.3d 707, 713 (7th Cir.2002)....
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