Pfizer Inc. v. Apotex Inc.

• Decision Date: 29 September 2010
• Docket Number: Case No. 08 C 7231.
• Citation: 744 F.Supp.2d 758
• Parties: PFIZER INC., Pfizer Ireland Pharmaceuticals Warner–Lambert Company, and Warner–Lambert Company, LLC, Plaintiffs,v.APOTEX INC., and Apotex Corp., Defendants.
• Court: U.S. District Court — Northern District of Illinois

744 F.Supp.2d 758

PFIZER INC., Pfizer Ireland Pharmaceuticals Warner–Lambert Company, and Warner–Lambert Company, LLC, Plaintiffs,

v.APOTEX INC., and Apotex Corp., Defendants.

Case No. 08 C 7231.

United States District Court, N.D. Illinois, Eastern Division.

Sept. 29, 2010.

40,667. Cited.

Rudolf E. Hutz, Daniel C. Mulveny, Jeffrey B. Bove, Mary W. Bourke, Connolly Bove Lodge & Hutz LLP, Wilmington, DE, Jeffrey Mark Drake, John S. Mortimer, Wood Phillips, Chicago, IL, William E. Mcshane, Connolly Bove Lodge & Hutz LLP, Washington, DC, for Plaintiffs.

William Andrew Rakoczy, Andrew M. Alul, Deanne M. Mazzochi, Paul J. Molino, Rakoczy Molino Mazzochi Siwik LLP, Chicago, IL, John C. Phillips, Jr., Brian E. Farnan, Phillips, Goldman & Spence, P.A., Wilmington, DE, for Defendants.

MEMORANDUM OPINION AND ORDER

MARTIN C. ASHMAN, United States Magistrate Judge.

Plaintiffs, including Pfizer Inc. (“Pfizer”), sued Apotex Inc. and Apotex Corp. (collectively “Apotex”) for patent infringement. Currently before the Court is Pfizer's Motion for a Protective Order seeking to limit certain activities of Apotex's outside counsel who review certain documents this Court ordered Pfizer to produce to Apotex. The Court rules on this Motion under District Judge Robert M. Dow's referral of this case for discovery supervision pursuant to N.D. Ill. Rule 72.1. For the reasons stated below, the Court finds that Pfizer's Motion is denied.

I. Background

The facts underlying this case have been thoroughly laid out by the District Judge in his prior Order denying Pfizer's motion to dismiss. See Pfizer, Inc. v. Apotex, Inc., 726 F.Supp.2d 921, 923–27, Nos. 08–cv–7231 et al., 2010 WL 2649841, at *1–4 (N.D.Ill. June 30, 2010). The Court discusses them here, therefore, only insofar as they are relevant to Pfizer's current Motion. Pfizer owns the primary patent at issue in this case, U.S. Reissue Patent No. 40,667 (“the '667 patent”), which it uses to produce the highly profitable anti-cholesterol drug Lipitor®. The Federal Drug Administration approved Lipitor®, which contains atorvastatin calcium, in 1996, and Pfizer began selling it in 1997. Not surprisingly, Lipitor®'s commercial success provided a significant incentive for various generic drug companies to attempt to enter the atorvastatin market by filing Abbreviated New Drug Applications (“ANDA”). See id. at 923–26, at *1–3 (describing the ANDA process under the Hatch–Waxman Act, 21 U.S.C. § 355).

Ranbaxy Laboratories Ltd. (“Ranbaxy”) was the first of the generic companies to file an ANDA in August, 2002. Its filing included all five patents that Pfizer held on Lipitor® at the time. In response, Pfizer filed suit against Ranbaxy for patent infringement on two of these patents, and the Federal Circuit eventually found one to have been infringed (Patent No. 4,681, 893) and one not to have been (Patent No. 5,273,995). See Pfizer, Inc. v. Ranbaxy Laboratories Ltd., 457 F.3d 1284 (Fed.Cir.2006). The latter patent is the one at issue here as the '667 reissue patent. Pfizer and Ranbaxy eventually entered a settlement agreement under which Ranbaxy agreed not to market its generic product until November 30, 2011. Pfizer, 726 F.Supp.2d at 925–26, 2010 WL 2649841, at *3, Other generic drug manufacturers followed Ranbaxy's lead, and suits between Pfizer and Teva Pharmaceuticals USA, Inc. (“Teva”) and Cobalt Pharmaceuticals Inc. (“Cobalt”) also ended in settlement agreements. Id. Apotex filed its ANDA for atorvastatin on November 4, 2008, and Pfizer took swift action to fend off Apotex by filing this patent infringement suit on December 17 of the same year. Apotex quickly filed counterclaims asserting non-infringement and the invalidity of a number of Pfizer's patents.

As part of its case, Apotex sought to discover several classes of documents related to, among other things, Pfizer's settlements with Teva and Cobalt as well as Pfizer's handling of the entry of generic atorvastatin onto the market. Unsurprisingly, Pfizer strongly objected to the production of these documents, and Apotex filed a motion to compel production on four primary requests:

REQUEST NO. 114: Any and all documents and things relating to generic competition or potential competition for LIPITOR® or to preventing generic entry of LIPITOR® on to the U.S. market.

RBQUEST NO. 115: Any and all documents and things relating to “Life Cycle Management” of LIPITOR®.

* * *

REQUEST NO. 122: All documents and things regarding any authorized generic entry agreements, licenses and/or contracts [Pfizer has] entered into with any other drugs [that] are subject to a patent challenge.

* * *

REQUEST NO. 123: All documents and things regarding any agreements, licenses and/or contracts relating to any agreement reached between Plaintiffs and any third-party regarding the marketing of generic versions of Plaintiffs' atorvastatin products, including but not limited to any authorized generic entry agreement.

On August 4, 2010, this Court granted parts of Apotex's motion. See Pfizer, Inc. v. Apotex, Inc., 731 F.Supp.2d 754, No. 08 C 7231, 2010 WL 3087458 (N.D.Ill. Aug. 4, 2010). The Court denied Apotex's request for documents relating to the settlement agreements, but found that the company was entitled to the agreements themselves. The Court determined that the settlement agreements were relevant on two grounds. First, any licensing agreement between Pfizer and Ranbaxy could be relevant to secondary considerations such as the obviousness of the '667 patent and the commercial success of Lipitor®. See id. at 758–59, at *3–4. Secondary considerations include “commercial success, long-felt but unsolved needs, failure of others, and the presence of a motivation to combine, or avoid combining, prior art teaching.” Power–One Inc. v. Artesyn Techs., Inc., 599 F.3d 1343, 1352 (Fed.Cir.2010) (internal quotation and citation omitted). Second, the settlement documents might also be used as a defense for Apotex to show that Pfizer misused its patent by, among other things, threatening an infringement claim based on the '667 patent. Pfizer, 731 F.Supp.2d at 759–60, 2010 WL 3087458, at *4. The Court also found the generic entry documents were relevant in this case because they might show the harm Pfizer would suffer if generic atorvastatin enters the market. Id. at 762–63, at *6–7.

Pfizer now seeks a protective order covering the documents it must produce because they are allegedly confidential in nature. Pfizer seeks two forms of protection. According to Pfizer, Apotex's outside counsel in this suit who review the produced documents should be prevented from advising Apotex and other generic drug companies on settlement terms in this or any future litigation related to Lipitor®. Pfizer also seeks to limit the ability of Apotex's outside litigation counsel who see the documents from advising Apotex and other companies on how to introduce generic atorvastatin to the market.

II. Legal Standard

Federal Rule of Civil Procedure 26(c) provides that a court may “for good cause, issue an order to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense” on eight separate grounds, including an order that “confidential research, development, or commercial information not be revealed or be revealed only in a specified way[.]” Fed. R. Civ. P. 26(c)(1)(G). The party seeking a protective order bears the burden of proof to show that good cause exists for its issuance. In re Deutsche Bank Trust Co. Americas, 605 F.3d 1373, 1378 (Fed.Cir.2010). “The sole question is whether there is an unacceptable risk of or opportunity for ‘inadvertent disclosure’ of confidential information.” Autotech Techs. Ltd. Psp. v. Automationdirect.com, Inc., 237 F.R.D. 405, 407 (N.D.Ill.2006) (quoting Matsushita Elec. Indus. Co., Ltd. v. United States, 929 F.2d 1577, 1579 (Fed.Cir.1991)). If such a risk exists, a court must weigh it against the burden that would be placed on the party seeking the information if it is denied material necessary to its defenses or claims. In re Deutsche Bank, 605 F.3d at 1380.

III. Discussion

Before examining the merits of Pfizer's Motion, the Court notes that Fed. R. Civ. P. 26(c) requires the party requesting a protective order to “include a certification that the movant has in good faith conferred or attempted to confer with other affected parties in an effort to resolve the dispute without court action.” Fed. R. Civ. P. 26(c). Failure to include the required certificate of compliance is grounds for denying a protective order. Semsroth v. City of Wichita, No. 06–2376–KHV, 2007 WL 4442161, at *1 (D.Kan. Dec. 17, 2007). Northern District of Illinois Local Rule 37.2 also provides that the Court will refuse to hear motions under Rule 26 unless the moving party states that it consulted in person or by phone with the opposing party and made “good faith attempts” to resolve differences, providing the date, time, and place of such a conference as well as the names of the participating attorneys. N.D. Ill. R. 37.2.

Here, Pfizer has not complied with Rule 26(c) or Local Rule 37.2. Its Motion does not certify that Pfizer made good faith attempts to resolve this matter with Apotex, but instead attaches a letter demanding that Apotex comply with a prior letter agreement between the parties. The Motion includes a footnote stating that an unnamed Pfizer attorney “inquired” about this letter with an unnamed Apotex lawyer on August 17. (Pltf's. Mot. at 2 and Ex. B.). However, conferring “means more than mailing or faxing a letter to the opposing party.” Drake v. Reser's Fine Foods, Inc., No. 08–2592–KHV, 2009 WL 1532698, at *1 (D.Kan. June 2, 2009). Both Rule 26(c) and N.D. Ill. R. 37.2 are designed to encourage parties to resolve their differences without judicial intervention, thereby easing burdens on both the Court and the litigants. See N.D. Ill. R. 37.2 (stating that its requirements are designed “[t]o curtail undue delay and...