Merial Ltd. v. CIPLA Ltd.
| Decision Date | 21 June 2011 |
| Docket Number | CASE NO. 3:07-CV-125 (CDL) |
| Parties | MERIAL LIMITED and MERIAL SAS, Plaintiffs, v. CIPLA LIMITED, Defendant, VELCERA, INC. and FIDOPHARM, INC., Intervenors. |
| Court | U.S. District Court — Middle District of Georgia |
Plaintiffs Merial Limited and Merial SAS (collectively "Merial") contend that Defendant Cipla Limited ("Cipla") violated the Court's Order entered in this action on March 6, 2008 ("March 6, 2008 Order" or "2008 Order"), and that Intervenors Velcera, Inc. ("Velcera") and FidoPharm, Inc. ("FidoPharm") (collectively "Velcera") acted in concert with Cipla to violate that order. Merial seeks contempt sanctions against both Cipla and Velcera.1 Cipla responded with a motion to vacate the Court's March 6, 2008Order (ECF No. 33) claiming that it was void as to Cipla because Cipla was not subject to the personal jurisdiction of the Court at the time the Order was entered. In the alternative, Cipla argues that its conduct does not violate the 2008 Order. Velcera contends that it is not a party to the 2008 Order; that its conduct does not violate the Order; that if Cipla did not violate the Order, Velcera could not have acted in concert with Cipla to violate the Order; and even if Cipla violated the Order, Velcera did not act in concert with Cipla to violate the Order.
After an evidentiary hearing, written briefing, and oral argument by counsel, the Court finds that Cipla was subject to the jurisdiction of this Court in the action giving rise to Merial's contempt motion, that Cipla violated the Court's March 6, 2008 Order, and that Velcera acted in concert with Cipla in the violation of the Court's Order.2 Accordingly, Cipla'smotion to vacate the March 6, 2008 Order (ECF No. 33) is denied, and Merial's motions seeking contempt sanctions (ECF Nos. 24 & 30) are granted to the extent described in this Order. The Court's rulings are based upon the following Findings of Fact and Conclusions of Law.3
In the action giving rise to the Court's March 6, 2008 Order, Merial alleged that Cipla sold in the United States two veterinary products designed to treat dogs and cats for fleas and ticks, and that these two products, "CIPLA PROTEKTOR" and "CIPLA PROTEKTOR PLUS," infringed two of Merial's patents—United States Patent No. 5,232,940 ("'940 Patent"), of which Merial was the exclusive licensee, and United States Patent No. 6,096,329 ("'329 Patent"), assigned to Merial.
The '940 Patent included claims for a pesticide product that eliminated fleas and ticks on dogs and cats using a chemical formulation containing the active ingredient fipronil. Using the '940 Patent, Merial developed a product called "Frontline." The '940 Patent has since expired, and Merial does not rely upon it in support of its contempt motions.
The '329 Patent included claims for a pesticide product that eliminated fleas and ticks on dogs and cats using a chemical formulation consisting of two active ingredients, fipronil and methoprene, and inactive ingredients that served as an adjuvant for the effective delivery of the activeingredients. Using the '329 Patent formulation, Merial developed a financially successful product known as "Frontline Plus."
In the original Complaint in this action, Merial alleged that CIPLA PROTEKTOR infringed at least one claim of the '940 Patent and CIPLA PROTEKTOR PLUS infringed at least one claim of the '329 Patent. Merial sought a judgment that Cipla infringed the '940 and '329 Patents and requested injunctive relief to prevent Cipla from selling or causing to be sold in the United States products that infringed the '940 Patent and the '329 Patent.
Cipla failed to respond to Plaintiffs' Complaint, and the Court made an entry of default on March 6, 2008. In that Order, the Court found in relevant part that the '940 Patent and the '329 Patent were valid and enforceable. Order ¶ a, Mar. 6, 2008, ECF No. 18. The Court concluded that Cipla, having made and sold in the United States veterinary products containing the active ingredients fipronil and methoprene and containing inactive ingredients that served as an adjuvant for effective delivery of the active ingredients, infringed at least one claim of the '329 Patent. Id. ¶ c. The Court also found that Cipla, having made and sold in the United States veterinary productsthat contain fipronil, infringed at least one claim of the '940 Patent. Id. ¶ b. Based on the Court's findings of infringement, the Court ordered the following injunctive relief:
[Cipla], as well as those persons and entities in active concert with [Cipla] who have notice of this order, are herewith permanently enjoined from committing any act that infringes or causes or induces infringement of any claim of the '940 or '329 patents, including but not limited to making, having made, using, causing to be used, selling, causing to be sold, offering for sale, and causing to be offered for sale in the United States, and importing and causing to be imported into the United States, any product that infringes any claim of the '940 or '329 patents, including but not limited to the veterinary products denominated CIPLA PROTEKTOR that contain fipronil and the veterinary products denominated CIPLA PROTEKTOR PLUS that contain fipronil and methoprene[.]
Id. ¶ e. The Court subsequently entered a default judgment against Cipla.
6.
At the time that this patent action was filed and served on Cipla, Cipla manufactured the alleged infringing products CIPLAPROTEKTOR and CIPLA PROTECKTOR PLUS in India. Cipla is an Indian corporation with its principal place of business in Mumbai, India.
7.
CIPLA PROTEKTOR was designed to be a generic formulation of Merial's Frontline product. CIPLA PROTEKTOR PLUS was designed to be a generic version of Merial's Frontline Plus product, containing the same chemical formulation. As established in the Court's March 6, 2008 Order, these products infringed the '940 and '329 Patents, respectively.
8.
Cipla's PROTEKTOR products are offered for sale through internet retailers, including www.Petmedsrus.com ("Petmedsrus"). The Petmedsrus website lists Cipla as the manufacturer of the product "PROTEKTOR Spot On" and acknowledges that it sources its products from Indian companies. Notwithstanding this circumstantial evidence, Merial points to no direct evidence showing how Petmedsrus got the PROTEKTOR products or whether any agreement or relationship existed between Cipla and Petmedsrus for the sale of the PROTEKTOR products.
9.
CIPLA PROTEKTOR Spot On was available for purchase over the internet in the United States through Petmedsrus and was sold via the internet in the United States and in the State ofGeorgia. CIPLA PROTEKTOR Spot On was delivered in the State of Georgia. Petmedsrus offered PROTEKTOR Spot On for sale as a generic form of Frontline Plus.
10.
Merial has its principal place of business for the United States in the State of Georgia.
11.
Cipla, a foreign entity, transacted substantial business across the United States. It exported a substantial percentage of its products to the United States, applied for numerous patents and filed documents with the United States Environmental Protection Agency ("EPA") and the United States Food and Drug Administration ("FDA").
12.
Although it denies any meaningful contacts with the State of Georgia, Cipla contends that it would have been subject to the jurisdiction of courts in Illinois for the claims raised in the present action. The Court rejects that contention based on the following factual findings. Although Cipla made three shipments of some type of product to Illinois prior to the entry of the Court's default judgment, those shipments were all made after this action was filed. Cipla pointed the Court to no evidence of any shipments to Illinois prior to, or at the time this action was filed. Although evidence exists that Cipla hada relationship with Watson Laboratories, Inc., an entity located in Illinois, prior to the filing of the action, there is no evidence regarding the details of Cipla's relationship with Watson relating to the state of Illinois prior to the filing of this action. Furthermore, Cipla's newfound position that it would have been subject to jurisdiction in Illinois is inconsistent with previous positions it has taken in this litigation and in litigation in Illinois. Throughout this litigation, Cipla has maintained that it is not subject to jurisdiction in the United States and has minimal, if any, contacts with the United States, including Illinois. Shortly after Cipla fell into default in this action, Cipla's counsel wrote the Court a letter denying a presence in the United States. Letter from R. Green, Counsel for Cipla, to the Court, Apr. 14, 2008, ECF No. 20. Cipla has also represented to the Court in its briefing that: Def. Cipla Ltd.'s Mem. of Law in Supp. of its Mot. to Vacate the Default J. 3, ECF No. 33-1 (citations omitted). To further refute Cipla's position that it would havebeen subject to personal jurisdiction in Illinois, the Court relies on pleadings filed in an action in Illinois in which Cipla expressly denied that it had sufficient connection to the state of Illinois for personal jurisdiction purposes, even though in that action it voluntarily consented to submit to jurisdiction. Pl.'s Tr. Ex. 104, Defs.' Am. Answer, Affirmative Defenses and Countercls. to Pl.'s Am. Compl. for Patent Infringement ¶ 11, Connetics Corp. v. Pentech Pharms., Inc., Civil Action No. 1:07-CV-06297, ECF No. 116 (N.D. Ill.). Finally, ...
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