Horatio Wash. Depot Techs. LLC v. Tolmar, Inc.
| Decision Date | 01 November 2018 |
| Docket Number | Civil Action No. 17-1086-LPS |
| Parties | HORATIO WASHINGTON DEPOT TECHNOLOGIES LLC, Plaintiff, v. TOLMAR, INC., TOLMAR PHARMACEUTICALS, INC., and TOLMAR THERAPEUTICS, INC., Defendants. |
| Court | U.S. District Court — District of Delaware |
Presently before the Court is Defendants TOLMAR, Inc., TOLMAR Pharmaceuticals, Inc., and TOLMAR Therapeutics, Inc.'s (collectively "Defendants" or "TOLMAR") motion to dismiss for failure to state a claim (the "Motion"), filed pursuant to Federal Rule of Civil Procedure 12(b)(6). (D.I. 12) Defendants argue that Plaintiff Horatio Washington Depot Technologies LLC's ("Plaintiff" or "Horatio") Complaint, (D.I. 1), which alleges infringement of United States Patent Nos. 5,932,547 (the "'547 patent"), 6,124,261 (the "'261 patent"), and 6,235,712 (the "'712 patent") (together the "asserted patents" or "patents-in-suit"), should be dismissed for various reasons. For the reasons that follow, the Court recommends that Defendants' Motion be GRANTED-IN-PART and DENIED-IN-PART.
Plaintiff is the owner of the asserted patents by assignment and has the right to sue for past damages. (Id. at ¶¶ 17-19) The asserted patents are all titled "Non-Aqueous Polar Aprotic Peptide Formulations[,]" and were issued between 1999 and 2001. (Id.) The '547 and '261 patents (the "formulation patents") "are directed to stable, non-aqueous formulations of a peptide compound and solvent," while "the 712 patent is directed to methods of preparing those formulations and treating prostate cancer using those formulations." (D.I. 13 at 4) At the time of the filing of this action in August 2017, the three asserted patents had already expired on June 13, 2017. (Id. at 3) Further information about the patents and products reading on the patents is set forth in Section III.
According to the Complaint, Defendant "TOLMAR Pharmaceuticals, Inc. holds approved New Drug Applications ('NDA')" for various doses of its branded drug Eligard® (the "accused product"). (D.I. 1 at ¶ 23) "Eligard is indicated for use in the palliative treatment of advanced prostate cancer" and "contains leuprolide acetate, a luteinizing hormone-release hormone (LH-RH) related compound as its active pharmaceutical ingredient." (Id.) Plaintiff alleges that Defendants directly, indirectly and willfully infringed the patents-in-suit relating to the making, using, selling or offering for sale of Eligard. (Id. at ¶¶ 29-109)
On August 3, 2017, Plaintiff filed this action against Defendants. (D.I. 1) On August 11, 2017, Chief Judge Leonard P. Stark referred the case to the Court to resolve any and all matters with regard to scheduling, as well as any motions to dismiss, stay, or transfer venue. (D.I. 8)
On September 27, 2017, Defendants filed the instant Motion, (D.I. 12), and briefing was completed on November 15, 2017, (D.I. 21). The Court heard oral argument on the Motion at the request of all parties on May 9, 2018. (D.I. 59 ("Tr.")) Thereafter, Defendants filed two notices of subsequent authority, (D.I. 49; D.I. 57), and Plaintiff filed a statement in response to the second notice, (D.I. 58).
Pursuant to Rule 12(b)(6), a party may move to dismiss the plaintiff's complaint based on the failure to state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). The sufficiency of pleadings for non-fraud cases is governed by Federal Rule of Civil Procedure 8, which requires "a short and plain statement of the claim showing that the pleader is entitled torelief[.]" Fed. R. Civ. P. 8(a)(2). In order to survive a motion to dismiss pursuant to Rule 12(b)(6), "a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotation marks and citation omitted). In assessing the plausibility of a claim, first the court separates the factual and legal elements of a claim, accepting "all of the complaint's well-pleaded facts as true, but [disregarding] any legal conclusions." Fowler v. UPMC Shadyside, 578 F.3d 203, 210-11 (3d Cir. 2009). Second, the court determines "whether the facts alleged in the complaint are sufficient to show that the plaintiff has a 'plausible claim for relief.'" Id. at 211 (quoting Iqbal, 556 U.S. at 679).
A plausible claim does more than merely allege entitlement to relief; it must also demonstrate the basis for that "entitlement with its facts." Id. Thus, a claimant's "obligation to provide the 'grounds' of his 'entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do[.]" Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citations omitted). In assessing the plausibility of a claim, the court must "'construe the complaint in the light most favorable to the plaintiff, and determine whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief.'" Fowler, 578 F.3d at 210 (quoting Phillips v. Cnty. of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008)).
Defendants assert various grounds for dismissing some or all of the Counts in the Complaint. One of those grounds is the argument that all claims of infringement of the two formulation patents should be dismissed because Plaintiff failed to plead compliance with the marking statute, 35 U.S.C. § 287(a) (). (D.I. 13 at 3, 17-20) At oral argument, the parties spent most of their time addressing that issue. (See Tr. at 23-25, 31 ()) Therefore, the Court will address the marking issue first, and will address the other alleged pleading deficiencies thereafter.
Under Section 287(a):
Patentees, and persons making, offering for sale, or selling within the United States any patented article for or under them . . . may give notice to the public that the same is patented, either by fixing thereon the word "patent" or the abbreviation "pat.", together with the number of the patent, or by fixing thereon the word "patent" or the abbreviation "pat." together with an address of a posting on the Internet, accessible to the public without charge for accessing the address, that associates the patented article with the number of the patent, or when, from the character of the article, this can not be done, by fixing to it, or to the package wherein one or more of them is contained, a label containing a like notice. In the event of a failure so to mark, no damages shall be recovered by the patentee in any action for infringement, except on proof that the infringer was notified of the infringement and continued to infringe thereafter, in which event damages may be recovered only for infringement occurring after such notice. Filing of an action for infringement shall constitute such notice.
35 U.S.C. § 287(a). Thus, when required by the statute, notice that sales of a product may constitute patent infringement may be given to the alleged infringer in one of two ways: (1) via constructive notice, by properly marking the patentee's own product (or its packaging); or (2) via actual notice (such as by filing an infringement action against the infringer). See Lambda Optical Sols., LLC v. Alcatel-Lucent USA Inc., Civil Action No. 10-487-RGA-CJB, 2015 WL 5470175, at *3 (D. Del. July 29, 2015) report and recommendation adopted sub nom. LAMBDA Optical Sols. LLC v. Alcatel Lucent USA Inc., No. CV 10-487-RGA, 2015 WL 5458269 (D. Del. Sept. 17, 2015).
The statute's language and related requirements set up a few different possible scenarios. For example, if a patentee (or other person mentioned in the statute) never produces or sells a patented product, then the patentee/person's ability to recover damages is not limited by thestatute. Id. (citing Texas Dig. Sys., Inc. v. Telegenix, Inc., 308 F.3d 1193, 1219-20 (Fed. Cir. 2002)). On the other hand, if a patentee produces or sells a patented product, but does not mark the patented product in a manner described in Section 287(a), it forfeits the right to recover damages for the period in which it was producing or selling the unmarked product (unless and until it provides the actual notice to the potential infringer). Id. Relatedly, the Court has also concluded that if a patentee produces or sells an unmarked patented product—but then later ceases such production/sales—it may still not collect damages thereafter for infringement until it takes active steps to address the failure to mark, such as by affirmatively providing notice to a potential infringer. Id. at *5; see also Arctic Cat Inc. v. Bombardier Recreational Prods., Inc., Case No. 14-cv-62369-BLOOM/Valle, 2018 WL 3820610, at *7 (S.D. Fla. Aug. 10, 2018) ().
Patents that contain only method claims, such as the '712 patent, are not subject to the notice provisions of Section 287(a), ActiveVideo Networks, Inc. v. Verizon Commc'ns, Inc., 694 F.3d 1312, 1334 (Fed. Cir. 2012), whereas the formulation patents, which contain only product claims, are subject to those provisions. It is plaintiff's burden to both plead and prove compliance with the marking statute. Arctic Cat Inc. v. Bombardier Recreational Prods. Inc., 876 F.3d 1350, 1366 (Fed. Cir. 2017); ...
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