Bausch Health Ir. Ltd. v. Padagis Isr. Pharm. LTD
| Decision Date | 20 May 2022 |
| Docket Number | Civil Action No. 20-5426 (SRC) (CONSOLIDATED) |
| Citation | 603 F.Supp.3d 107 |
| Parties | BAUSCH HEALTH IRELAND LIMITED, et al., Plaintiffs, v. PADAGIS ISRAEL PHARMACEUTICALS LTD et al., Defendants. |
| Court | U.S. District Court — District of New Jersey |
J. Brugh Lower, William P. Deni, Jr., Gibbons PC, Newark, NJ, for Plaintiffs.
Karen A. Confoy, Paul W. Kalish, Cali Roth Spota, Dominique J. Carroll, Fox Rothschild LLP, PC, Lawrenceville, NJ, for Defendants Padagis Israel Pharmaceuticals Ltd., Padagis US LLC.
This matter comes before the Court on the motion for summary judgment of no inequitable conduct by Plaintiffs Bausch Health Ireland Limited, Bausch Health Americas Inc., and Bausch Health US, LLC (collectively, "Bausch"). The motion is opposed by Defendants Padagis Israel Pharmaceuticals LTD and Padagis US LLC (collectively, "Padagis.") This motion concerns patents related to the drug Duobrii®. Padagis is a pharmaceutical company which has filed ANDA No. 214626 to produce a generic version of that pharmaceutical product. Bausch owns U.S. Patent Nos. 10,251,895 ("the ’895 patent") and 10,426,787 (the " ’787 patent," and together with the ’895 patent, the "Combination Patents"). For the reasons that follow, Plaintiffs’ motion will be granted.
United States Patent Application No. 15/173,961 ultimately issued as the ’895 patent. United States Patent Application No. 15/903,785 ultimately issued as the ’787 patent. The Combination Patents have the same inventors, both claim priority to United States Provisional Patent Application No. 15/903,785, which was filed on June 18, 2015, and the two patents have substantially identical specifications, for purposes of this motion. In briefing this motion, the parties have generally treated the two prosecution histories as if they were the same and have not pointed to any material differences between the actions of the applicants or the PTO in the two prosecution histories. The parties do not dispute that the statements of the reasons for allowance issued by the Examiner in the two prosecutions are nearly identical. Because, in briefing this motion, the parties have generally treated the two prosecution histories as not differing materially, this Court follows suit. In this Opinion, the Court will generally cite to the prosecution history of the ’895 patent, with the understanding that a parallel citation to the prosecution history of the ’787 patent is implied.
Summary judgment is appropriate under FED. R. CIV. P. 56(a) when the moving party demonstrates that there is no genuine issue of material fact and the evidence establishes the moving party's entitlement to judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). A factual dispute is genuine if a reasonable jury could return a verdict for the non-movant, and it is material if, under the substantive law, it would affect the outcome of the suit. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). "In considering a motion for summary judgment, a district court may not make credibility determinations or engage in any weighing of the evidence; instead, the non-moving party's evidence ‘is to be believed and all justifiable inferences are to be drawn in his favor.’ " Marino v. Indus. Crating Co., 358 F.3d 241, 247 (3d Cir. 2004) (quoting Anderson, 477 U.S. at 255, 106 S.Ct. 2505 ).
"When the moving party has the burden of proof at trial, that party must show affirmatively the absence of a genuine issue of material fact: it must show that, on all the essential elements of its case on which it bears the burden of proof at trial, no reasonable jury could find for the non-moving party." In re Bressman, 327 F.3d 229, 238 (3d Cir. 2003) (quoting United States v. Four Parcels of Real Property, 941 F.2d 1428, 1438 (11th Cir. 1991) ). "[W]ith respect to an issue on which the nonmoving party bears the burden of proof ... the burden on the moving party may be discharged by ‘showing’ – that is, pointing out to the district court – that there is an absence of evidence to support the nonmoving party's case." Celotex, 477 U.S. at 325, 106 S.Ct. 2548.
Once the moving party has satisfied its initial burden, the party opposing the motion must establish that a genuine issue as to a material fact exists. Jersey Cent. Power & Light Co. v. Lacey Township, 772 F.2d 1103, 1109 (3d Cir. 1985). The party opposing the motion for summary judgment cannot rest on mere allegations and instead must present actual evidence that creates a genuine issue as to a material fact for trial. Anderson, 477 U.S. at 248, 106 S.Ct. 2505 ; Siegel Transfer, Inc. v. Carrier Express, Inc., 54 F.3d 1125, 1130-31 (3d Cir. 1995). "[U]nsupported allegations ... and pleadings are insufficient to repel summary judgment." Schoch v. First Fid. Bancorporation, 912 F.2d 654, 657 (3d Cir. 1990). "A nonmoving party has created a genuine issue of material fact if it has provided sufficient evidence to allow a jury to find in its favor at trial."1 Gleason v. Norwest Mortg., Inc., 243 F.3d 130, 138 (3d Cir. 2001). "In reviewing the record, the court must give the nonmoving party the benefit of all reasonable inferences." Brewer v. Quaker State Oil Ref. Corp., 72 F.3d 326, 330 (3d Cir. 1995).
If the nonmoving party has failed "to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial, ... there can be ‘no genuine issue of material fact,’ since a complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial." Katz v. Aetna Cas. & Sur. Co., 972 F.2d 53, 55 n.5 (3d Cir. 1992) (quoting Celotex, 477 U.S. at 322-23, 106 S.Ct. 2548 ).
I. The motion for partial summary judgment
Bausch moves for summary judgment on Padagis’ affirmative defense and counterclaim that the inequitable conduct case. The summary judgment burden then shifts to Padagis.
The parties agree that the Federal Circuit set forth the basic principles of the contemporary law of inequitable conduct in Therasense:
[I]nequitable conduct came to require a finding of both intent to deceive and materiality. To prevail on the defense of inequitable conduct, the accused infringer must prove that the applicant misrepresented or omitted material information with the specific intent to deceive the PTO. The accused infringer must prove both elements—intent and materiality—by clear and convincing evidence. If the accused infringer meets its burden, then the district court must weigh the equities to determine whether the applicant's conduct before the PTO warrants rendering the entire patent unenforceable.
Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276, 1287 (Fed. Cir. 2011) (citations omitted).
Padagis asserts two theories of inequitable conduct during prosecution of the Combination Patents. First, Padagis asserts that "[t]he record in this case provides clear and convincing evidence that Dr. Sugarman submitted false declarations during prosecution of the Combination Patents and did so with specific intent to deceive the USPTO" (hereinafter, the "Sugarman Theory.") (Defs.’ Opp. Br. at 16.) Second, Padagis asserts that "[t]he record provides clear and convincing evidence that at least Dr. Pillai, a named inventor, knowingly withheld material prior art during prosecution of the Combination Patents with intent to deceive the USPTO" (hereinafter, the "Pillai Theory.") (Defs.’ Opp. Br. at 30.)
As to the Sugarman Theory, Padagis argues that the Sugarman Declaration, filed by the applicants during prosecution of both patents, is materially false, as it contains the following materially false statement in paragraph 11: "the Invention unexpectedly achieved the synergistic efficacy over the combination of halobetasol propionate and tazarotene monotherapies" (hereinafter, the "Alleged False Statement.") Padagis contends that the word "unexpectedly" in that statement is a falsehood, and that Sugarman knew that synergistic efficacy was expected when he wrote that statement in 2018. As evidence, Padagis principally2 relies on a 2017 publication, a research article on which Sugarman is the first named author, published in 2017 in the Journal of Drugs in Dermatology ("Sugarman 2017.") (Bruno Dec. Ex. 30.) Padagis points to a sentence in this publication which states: "combining a topical corticosteroid [with tazarotene
] is one option that may prevent the irritancy effects of tazarotene while providing a synergistic therapeutic effect as well as a potential decrease in steroid-induced atrophy" (hereinafter, the "2017 Statement.") (Id. at 198.)
Padagis summarizes its argument for the falsity of the Alleged False Statement as follows: "Padagis's Opposition repeatedly identified Dr. Sugarman's statement that the invention ‘unexpectedly achieved synergistic efficacy’ as being false and directly contradicted by his statement in Sugarman 2017."3 (Def.’s Sur-Reply Br. at 2 n.2.) Thus, Defendants’ principal evidence of the falsity of the Alleged False Statement is the statement in Sugarman 2017 which, Padagis argues, directly contradicts the Alleged False Statement. At this stage in the summary judgment analysis, to defeat the motion for summary judgment as to the Sugarman Theory, Padagis must provide sufficient evidence to allow a factfinder to find in its favor at trial.
The key question is, then: has Padagis offered sufficient evidence to allow a factfinder to find, at trial, that the 2017 Statement directly contradicts the Alleged False...
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