Alvotech U.S. Inc. v. AbbVie Inc.

• Decision Date: 21 October 2021
• Docket Number: C. A. 2:21-cv-265-RAJ-DEM
• Court: U.S. District Court — Eastern District of Virginia
• Parties: ALVOTECH USA INC. and ALVOTECH HF., Plaintiffs, v. ABBVIE INC. and ABBVIE BIOTECHNOLOGY LTD.. Defendants.

ALVOTECH USA INC. and ALVOTECH HF., Plaintiffs, v. ABBVIE INC. and ABBVIE BIOTECHNOLOGY LTD.. Defendants.

C. A. No. 2:21-cv-265-RAJ-DEM

United States District Court, E.D. Virginia, Norfolk Division

October 21, 2021

MEMORANDUM OPINION AND ORDER

Before the Court is Defendants', AbbVie Inc. and AbbVie Biotechnology Ltd. (collectively "Defendants") Motion to Dismiss or, in the Alternative, to Transfer Venue ("Motion"), pursuant to the first-to-file rule Federal Rule of Civil Procedure 12(b)(2), and 28 U.S.C § 1404(a). For the reasons set forth below Defendants' Motion is GRANTED IN PART. Defendants' Motion to Transfer Venue is GRANTED, and it is ORDERED that this case be transferred to the Northern District of Illinois. Accordingly, the Court FINDS Defendants' Motion to Dismiss MOOT.

I. FACTUAL AND PROCEDURAL HISTORY

AbbVie Inc. ("AbbVie") is a pharmaceutical company that is incorporated in Delaware and headquartered in North Chicago, Illinois. Defs.' Am. Mem. in Supp. of Mot. to Dismiss or Transfer ("Defs.` Mem. in Supp."), ECF No. 43 at 3; Decl. of Sowmyan Ranganathan ("Ranganathan Decl"), ECF No. 34 ¶ 7. AbbVie employs over 10, 000 people in Illinois, nearly all of whom work at AbbVie's main campus and two additional locations in the North Chicago area. Defs.` Mem. in Supp. at 3; Ranganathan Decl. ¶ 8. AbbVie Biotechnology Ltd. ("ABL") is a wholly-owned subsidiary of AbbVie, organized and existing under the laws of Bermuda. Defs.` Mem. in Supp. at 3; Ranganathan Dec]. ¶ 12. ABL manufactures and owns the patents for adalimumab, the active ingredient in HUM IRA®, which is used to treat autoimmune disorders. Pis.' Mem. in Opp. to Defs.' Mot. to Dismiss or Transfer ("Pis.' Mem. in Opp."), ECF No. 44 at 4; Defs.` Mem. in Supp, at 3; Ranganathan Decl. ¶¶ 10, 13. AbbVie's predecessor invented adalimumab in 1996. Defs.' Mem. in Supp. at 3; Ranganathan Decl. ¶¡ 10. Since then, Defendants have continued to develop and improve the drug, while licensing the patents for adalimumab to AbbVie exclusively for final packaging in North Chicago before HUMIRA® is shipped to customers. Defs.' Mem. in Supp. at 3: Ranganathan Decl. ¶¶ 10, 13-14.

Alvotech hf. is an Icelandic pharmaceutical company with headquarters and manufacturing operations in Reykjavik, Iceland. Compl., ECF No. 1 at 6. In Iceland, Alvotech hf. houses a "multi-product, 140, 000 square foot biopharmaceutical facility, with personnel specializing in [the] process and product development and commercial manufacturing" of pharmaceutical biosimilars. Id; Pis.' Mem. in Opp. at 3. Alvotech USA is a wholly owned subsidiary of Alvotech hf. that is incorporated and headquartered in Arlington, Virginia. Id. Alvotech USA is responsible for the legal, governmental policy, and regulatory affairs of the Alvotech "family of companies." Id. In addition to employing the Head of Regulatory Affairs, Chief Intellectual Property Counsel, and Chief Scientific Officer out of its sole office in Virginia, "the core of [Alvotech USA's] business is interactions with the FDA, Capitol Hill, and the Patent and Trademark Office." Compl. at 7; Pls.' Mem. in Opp. at 3.

In November 2020, Alvotech USA Inc. and Alvotech Hf. (collectively "Plaintiffs") engaged Defendants in "the patent dance" under the Biosimilar Price Competition and Innovation Act of 2009 ("BPC1A"), seeking FDA approval to commercialize AVT02, an adalimumab biosimilar. Pis.' Mem. in Opp. at 5; Defs.' Mem. in Supp. at 5-6. Alvotech hf. manufactured and produced AVT02, while Alvotech USA filed the biologies license application ("BLA") with the FDA. Compl. at 7. During the patent dance, Plaintiffs identified four out of 62 potential patents for litigation under the BPCIA: U.S. Patent Nos. 8, 420, 08 1; 9, 085, 619; 8, 926, 975; and 8, 961.973. Compl. at 4; Defs.' Mem. in Supp. at 6-7. Two of the patents at issue relate to the high-concentration formulas of adalimumab used in HUMIRA®, while the other two patents relate to treatment methods for the autoimmune diseases that HUM IRA© is employed to improve. Id.

On April 27, 2021, in accordance with the BPCIA`s framework for FDA approval of biosimilars, Defendants filed a patent infringement action against Alvotech hf. in the Northern District of Illinois under 35 U.S.C. § 271(e)(2), alleging that Alvotech hf. infringed on the four patents identified during the patent dance. Plaintiffs then tiled the present declaratory judgment action in the Eastern District of Virginia on May 11, 2021. In the present action, Plaintiffs are seeking declaratory judgement for multiple noninfringement, invalidity, and unenforceability claims regarding the same four patents at issue in Defendants' first suit in the Northern District of Illinois. Compl. at 4; Defs.'Notice Re: Defs.' Mot. to Dismiss or Transfer ("Defs.` Notice"), ECF No. 48 at Ex. 1. Subsequently, on May 28, 2021, Defendants filed a second suit against Alvotech hf. in the Northern District of Illinois, alleging infringement of the remaining 58 patents identified during the patent dance.

In June 2021, Defendants moved to dismiss or, in the alternative, transfer the present action to the Northern District of Illinois. On August 23, 2021, the court in Defendants' first action against Alvotech hf. in the Northern District of Illinois denied Alvotech hf's motion to dismiss Defendants' infringement claims, rejecting many of the same arguments Plaintiffs filed in opposition to Defendants' Motion here. Defs.' Notice at Ex. 1.

II. LEGAL STANDARD

The decision of whether to transfer an action under 28 U.S.C. § 1404(a) is committed to the sound discretion of the district court. Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 24 (1988); JTH Tax. Inc. v. Lee, 482 F.Supp.2d 73 1, 732 (E.D. Va. 2007). The moving party bears the burden of showing that transfer is proper and must demonstrate that transfer does more than merely shift the inconvenience to the other party. JTH Tax, 482 F.Supp.2d at 736 (internal citations omitted). Courts must make two overarching inquiries in deciding whether transfer is proper: (1) whether the claims could have been brought in the transferee forum; and (2) whether the interest of justice and convenience of the parties and witnesses justify transfer to that forum. 28 U.S.C. § 1404(a); id. at 732 (citing In re Ralston Purina Co., 726 F.2d 1002, 1005 (4th Cir. 1984); Verosol B. V. v. Hunter Douglas, Inc., 806 F.Supp. 582, 592 (E.D. Va. 1992)).

III. DISCUSSION

(A) Venue in Transferee Forum

Venue for this suit would be proper in the Northern District of Illinois. Where jurisdiction is not founded solely on diversity of citizenship, venue is proper in "a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located 28 U.S.C. § 1391 (b)(1); JTH Tax, 482 F.Supp.2d at 736. An entity, if a defendant, shall be deemed to reside in any judicial district in which such defendant is "subject to the court's personal jurisdiction with respect to the civil action in question." 28 U.S.C. § 1391(c)(2).

In this case, venue would be proper in the Northern District of Illinois. Since Plaintiffs are seeking declaratory judgement in a patent dispute, the Northern District of Illinois would have subject matter jurisdiction over this case under 28 U.S.C. §§ 1331, 1338(a), 2201. and 2022. Compl. at 7; Defs.` Mem. in Supp. at 20. In addition, Defendants contend-and Plaintiffs do not dispute-that Defendants are subject to personal jurisdiction in the Northern District of Illinois. Defs.' Mem. in Supp. at 20-21. At minimum, Defendants have headquarters in the Northern District of Illinois and sued Plaintiffs there regarding the same patents at issue in this matter. establishing personal jurisdiction in the district. For these reasons, the jurisdiction inquiry weighs in favor of transfer.

(B) Convenience of the Parties and Witnesses and the Interest of Justice

Next this Court must consider the following factors: (1) the plaintiffs initial choice of venue; (2) the convenience of the parties and witnesses; and (3) the interest of justice. Bluestone Innovations, LLC v. LG Elecs., Inc., 940 F.Supp.2d 310, 313 (E.D. Va. 2013); Heinz Kettler GmbH & Co. v. Razor USA. LLC, 750 F.Supp.2d 660, 667 (F.D. Va. 2010); JTH Tax, 482 F.Supp.2d at 736. The Court will address each factor in turn.

(1) Plaintiffs ` Initial Choice of Venue

Plaintiffs' choice of venue is not entitled to deference under the first factor because the Eastern District of Virginia has little connection to the underlying cause of action. Under 28 U.S.C § 1404(a), "[t]hc party seeking transfer bears the burden of proving that the circumstances of the case are strongly in favor of transfer." Heinz, 750 F.Supp.2d at 667. "The plaintiffs choice of forum is typically entitled to substantial weight, especially where the chosen forum is the plaintiffs home or bears a substantial relation to the cause of action." Blues/one Innovations, 940 F.Supp.2d at 314. The amount of deference given to a plaintiffs forum choice, however, varies with the significance of the contacts between the selected venue and the underlying cause of action. Id. Ultimately, "a plaintiffs choice of forum is not entitled to substantial weight if the . . . cause of action bears little or no relation to that forum." Noetic Specialty Ins. Co. v. N.C. Mut. Wholesale Drug Co., 453 F.Supp.3d 842, 846 (F.D. Va. 2020). See also Koh v. Microtek Int'l. Inc.. 250 F.Supp.2d 627, 635 (E.D. Va. 2003) ("[I]f there is little connection between the claims and this judicial district, that would militate against a plaintiffs chosen forum and weigh in favor of transfer to a venue with more substantial contacts."); Ion Beam Applications S.A. v. Titan Corp.. 156 F.Supp.2d 552, 563 (E.D. Va....