Cellectis S.A. v. Precision Biosciences, Inc.

• Decision Date: 03 May 2012
• Docket Number: Civ. No. 11–173–SLR.
• Parties: CELLECTIS S.A., Plaintiff, v. PRECISION BIOSCIENCES, INC., Defendant.
• Court: U.S. District Court — District of Delaware

858 F.Supp.2d 376

CELLECTIS S.A., Plaintiff,

v.PRECISION BIOSCIENCES, INC., Defendant.

Civ. No. 11–173–SLR.

United States District Court,

D. Delaware.

May 3, 2012.

Chad M. Shandler, Esquire of Richards, Layton & Finger LLP, of Counsel, Richard L. DeLucia, Esquire, Paul M. Richter, Jr., Esquire, and Anne Elise Herold Li, Esquire of Kenyon & Kenyon LLP, for Plaintiff.

Richard L. Horwitz, Esquire and David E. Moore, Esquire of Potter Anderson & Corroon LLP, of Counsel, David B. Bassett, Esquire, Vinita Ferrera, Esquire, and Allen C. Nunnally, Esquire of Wilmer Cutler

Pickering Hale and Dorr LLP, for Defendant.

MEMORANDUM OPINION

SUE L. ROBINSON, District Judge.

I. INTRODUCTION

Pending before the court are various motions filed by the parties to this business dispute. Plaintiff Cellectis, S.A. (“Cellectis”) has moved to enjoin certain litigation filed by defendant Precision Biosciences, Inc. (“Precision”) against Cellectis in North Carolina, and Precision has moved to transfer the above captioned litigation to North Carolina or, in the alternative, to stay the litigation pending reexamination of the patent in suit. (D.I. 7, 16) The court has jurisdiction to hear these motions pursuant to 28 U.S.C. § 1338. Venue is appropriate pursuant to 28 U.S.C. § 1400(b). For the reasons that follow, the court grants Cellectis' motion to enjoin and denies Precision's motion to transfer.

II. BACKGROUNDA. The Parties

Cellectis is a publicly-traded biotechnology company in the field of genome engineering, particularly in the use of meganucleases as innovative tools to enable targeted modifications to DNA. Cellectis was founded in 1999 (D.I. 8 at 2) and, although incorporated and headquartered in France, it “has business relationships with companies all over the U.S. and throughout the world.” (D.I. 23 at 4; see also D.I. 1 at ¶ 1)

Precision is a privately-held biotechnology company that also has as its focus the development and commercialization of engineered endonucleases. It was founded in 2006 and is a Delaware corporation with its principal place of business in North Carolina. (D.I. 1 at ¶ 2; D.I. 10 at ¶ 2; D.I. 8 at 2)

B. The Parties' Litigation History

In March of 2008, Cellectis sued Precision in the United States District Court for the Eastern District of North Carolina for infringement of U.S. Patent Nos. 6,610,545 (“the '545 patent”) and 7,309,605 (“the '605 patent”). See Cellectis S.A. v. Precision BioSciences, Inc., Civ. No. 5:08–119–H (E.D.N.C.) (“ North Carolina I ”). The '545 and '605 patents each issued from an application first filed by Institut Pasteur in 1992. Subsequent to the initiation of suit, Precision requested, and was granted, inter partes reexamination of the '545 and '605 patents. Precision filed a motion to stay North Carolina I, which motion was granted in August 2010 at the close of fact discovery. (D.I. 23 at 6) The United States Patent and Trademark Office (“PTO”) has since rejected the claims of the '545 and '605 patents and an appeal is currently pending before the Board of Patent Appeals and Interferences.

On March 1, 2011 at 5:59 a.m., as soon as U.S. Patent No. 7,897,372 (“the ' 372 patent”) issued and was publicly available from the PTO's website, Cellectis filed the instant litigation against Precision for infringement of the '372 patent.¹ Later that same day, Precision filed a declaratory judgment action on the ' 372 patent in North Carolina (“ North Carolina II ”). Precision has filed its answer to the amended complaint in the instant litigation,and a scheduling order has been approved by the court. (D.I. 27, 33)

III. STANDARD OF REVIEW

Since the Act of 1897, when Congress first enacted what is now 28 U.S.C. § 1400(b),² any civil action for patent infringement could be brought in the judicial district in which the defendant was incorporated. Indeed, until 1990, the words “inhabitant” (used prior to 1948) and “resident” (used since 1948), as those words relate to corporate venue in patent infringement cases, were limited to “the state of incorporation only.” Fourco Glass Co. v. Transmirra Products Corp., 353 U.S. 222, 226, 77 S.Ct. 787, 1 L.Ed.2d 786 (1957); see also VE Holding Corp. v. Johnson Gas Appliance Co., 917 F.2d 1574, 1578 (Fed.Cir.1990). In 1990, the Federal Circuit in VE Holding interpreted the 1988 amendment to the general venue statute, 28 U.S.C. § 1391(c), as supplementing the specific provisions of § 1400(b). More specifically, § 1391 was amended to broaden the general venue provision for corporations: ³

(c) For purposes of venue under this chapter, a defendant that is a corporation shall be deemed to reside in any judicial district in which it is subject to personal jurisdiction at the time the action is commenced.

(emphasis added) The Federal Circuit held that the emphasized language above clearly indicated that § 1391(c), on its face, applied to § 1400(b), “and thus redefine[d] the meaning of the term ‘resides' in that section.” 917 F.2d at 1578. Thus, as recognized by the Federal Circuit, “[v]enue, which connotes locality, serves the purpose of protecting a defendant from the inconvenience of having to defend an action in a trial court that is either remote from the defendant's residence or from the place where the acts underlying the controversy occurred.... The venue statutes achieve this by limiting a plaintiff's choice of forum to only certain courts from among all those which might otherwise acquire personal jurisdiction over the defendant.” Id. at 1576 (citation omitted).

Since 1948, 28 U.S.C. § 1404(a) has given district courts the authority to “transfer any civil action to any other district or division where it might have been brought.” According to the Supreme Court, § 1404(a) “reflects an increased desire to have federal civil suits tried in the federal system at the place called for in the particular case by considerations of convenience and justice. Thus ..., the purpose of the section is to prevent the waste ‘of time, energy and money’ and ‘to protect litigants, witnesses and the public against unnecessary inconvenience and expense....’ To this end, it empowers a district court to transfer ‘any civil action’ to another district court if the transfer is warranted by the convenience of parties and witnesses and promotes the interest of justice.” Van Dusen v. Barrack, 376 U.S. 612, 616, 84 S.Ct. 805, 11 L.Ed.2d 945 (1964) (quoting Continental Grain Co. v. Barge F.B.L.–585, 364 U.S. 19, 26–27, 80 S.Ct. 1470, 4 L.Ed.2d 1540 (1960)). The Supreme Court has urged a “common-sense approach” to application of the statute, as it was designed as a “federal judicial housekeeping measure, dealing with the placement of litigation in the federal courts and generally intended, on the basis of convenience and fairness, simply to authorize a change of courtrooms.” Id. at 623, 636–37, 84 S.Ct. 805.See also Piper Aircraft Co. v. Reyno, 454 U.S. 235, 254, 102 S.Ct. 252, 70 L.Ed.2d 419 (1981). Consistent with Federal Circuit precedent characterizing motions to transfer pursuant to § 1404(a) as procedural matters, the law of the regional circuit provides the governing standards. In re Link–A–Media Devices Corp., 662 F.3d 1221, 1222–23 (Fed.Cir.2011); see also gen. Panduit Corp. v. All States Plastic Mfg. Co., Inc., 744 F.2d 1564, 1575 (Fed.Cir.1984) (“When we review procedural matters that do not pertain to patent issues, we sit as if we were the particular regional circuit court where appeals from the district court we are reviewing would normally lie. We would adjudicate the rights of the parties in accordance with the applicable regional circuit law.”).

Consistent with the Supreme Court's jurisprudence, “§ 1404(a) accords broad discretion to district court[s]” and “directs [such courts] to take account of factors other than those that bear solely on the parties' private ordering of their affairs. [A] district court also must weigh in the balance the convenience of the witnesses and those public interest factors of systemic integrity and fairness that, in addition to private concerns, come under the heading of the ‘interest of justice.’ ” Stewart Organization, Inc. v. Ricoh Corp., 487 U.S. 22, 30, 108 S.Ct. 2239, 101 L.Ed.2d 22 (1988). Likewise, the United States Court of Appeals for the Third Circuit has directed district courts to consider “many variants of the private and public interests protected by the language of § 1404(a).” Jumara v. State Farm Insurance Co., 55 F.3d 873, 879 (3d Cir.1995).

As can be seen, by the time Jumara issued in 1995, there was a recognized historical continuum that served as the backdrop for the Third Circuit's analysis. First, a defendant's state of incorporation had always been a predictable, legitimate venue for bringing suit. Second, a plaintiff, as the injured party, generally had been “accorded [the] privilege of bringing an action where he chooses.” Norwood v. Kirkpatrick, 349 U.S. 29, 31, 75 S.Ct. 544, 99 L.Ed. 789 (1955). Indeed, although it was recognized at the time that the enactment of § 1404(a) permitted judges to exercise broader discretion than had been the case under the common law doctrine of forum non conveniens,⁴ the risk associated with the exercise of such discretion was also recognized, as described in the dissenting opinion in Norwood as “assigning to the trial judge the choice of forums, a prerogative which has previously rested with the plaintiff.” Id. at 37, 75 S.Ct. 544 (Justice Clark, with whom Chief Justice Warren and Justice Douglas concurred, dissenting where the trial judge transferred three personal injury suits from Pennsylvania, where the plaintiffs resided, to South Carolina, the forum of choice for the defendant employer).

In Jumara, the Third Circuit establishes the analytical framework for the resolution of the instant motion to transfer. The Court starts its analysis by reminding the reader that “[t]he burden of establishing the need for transfer ... rests with the movant” and that, “ ‘in...