Trust. of Columbia Univ. V. Roche Diagnostics Gmbh

• Decision Date: 27 April 2001
• Docket Number: No. C.A. 93-11512-NG.,C.A. 93-11512-NG.
• Citation: 150 F.Supp.2d 191
• Parties: The TRUSTEES OF COLUMBIA UNIVERSITY IN THE CITY OF NEW NEW YORK, Plaintiff, v. ROCHE DIAGNOSTICS GMBH, formerly known as Boehringer Mannheim GmbH, Defendant.
• Court: U.S. District Court — District of Massachusetts

150 F.Supp.2d 191

The TRUSTEES OF COLUMBIA UNIVERSITY IN THE CITY OF NEW NEW YORK, Plaintiff, v. ROCHE DIAGNOSTICS GMBH, formerly known as Boehringer Mannheim GmbH, Defendant.

No. C.A. 93-11512-NG.

United States District Court, D. Massachusetts.

April 27, 2001.

Sarah C. Columbia, Choate, Hall & Stewart, Boston, MA, Rodney E. Gould, Rubin, Hay & Gould, Framingham, MA, Norman H. Zivin, Donna A. Tobin, Cooper & Dunham LLP, New York, NY, for Columbia University, the Trustees, in The City of New York, Plaintiff.

Peter F. Felfe, Fulbright & Jaworski, New York, NY, Cornelius J. Moynihan, Jr., Nicholas G. Papastavros, Nixon Peabody, Boston, MA, for GmbH Boehringer Mannheim, Defendant.

MEMORANDUM AND ORDER

GERTNER, District Judge.

I. INTRODUCTION

This case involves an allegation by plaintiff Columbia University ("Columbia") of patent infringement against defendant Roche Diagnostics GmbH (formerly Boehringer Mannheim, GmbH) ("Roche"), a multinational pharmaceutical corporation having its principal place of business in Mannheim, Germany. In essence, Columbia claims that Roche induced or otherwise collaborated with Genetics Institute ("GI"), a United States company based in Cambridge, Massachusetts, to produce the drug Erythropoietin ("EPO")¹ using methods and products for which Columbia holds the patents.

At issue is the degree of Roche's involvement in facilitating GI's infringing conduct. Though typically, United States patent law does not extend extraterritorial protection, the law has carved an exception akin to a common law notion of vicarious liability, whereby a foreign company may be held liable for its complicity in the infringing activities of a domestic actor. Thus, the central question here concerns Roche's relationship with GI, and in particular, its participation in GI's allegedly infringing activities.

The dispute revolves around U.S. Patent Nos. 4,399,216 ("the '216 patent"),² 4,634,665 ("the '665 patent"),³ and 5,179,017 ("the '017 patent")⁴ (collectively referred to as the "Axel patents").⁵ The Axel patents cover processes for inserting two genes into a host cell (cotransformation) in which one of the genes encodes a marker protein, and the other gene encodes a protein of interest.⁶ The claims also cover the cell lines produced by the process of amplification and cotransformation, variously described hereafter as the EPO generating Chinese Hamster Ovary ("CHO") host cell, the production clone, or DN2-3PΣ3. See Trustees of Columbia University in City of New York v. Roche Diagnostics GmbH, 126 F.Supp.2d 16 (D.Mass.2000) (hereinafter "Markman findings").⁷ The claims do not, however, cover the protein of interest that is produced by the cell, EPO.

Columbia alleges direct infringement under 35 U.S.C. § 271(a).⁸ It claims that when GI exported production clones to Roche for use in the German manufacture of EPO, GI never relinquished title to the cells. As such, Roche's extraterritorial use of the cells comprises direct activity in the United States within the meaning of the statute. Moreover, Roche directly imported into the United States a certain kind of serum-free EPO, which, Columbia argues, is the "fruit of the poisonous tree," i.e. a compound derived from Roche's infringement of the Axel patents.

Columbia also alleges vicarious or induced infringement under 35 U.S.C. § 271(b).⁹ Columbia contends that Roche was aware of Columbia's first patent, the '216 patent, when it gave financial support and encouragement to GI's infringing acts in the creation of EPO generating CHO host cells. Moreover, Columbia characterizes the agreement between Roche and GI not as a traditional buy-sell agreement, but rather as a collaboration, whereby GI was compensated for researching and developing commercially feasibly production clones with both parties jointly owning any intellectual property developed during the course of the project. Arguing largely from that collaboration, Columbia claims that Roche induced GI to (a) produce an infringing cell line, necessary for the EPO manufacture, (b) to export the cell line, (c) to manufacture EPO in the U.S. and in Germany, and (d) to re-import the serum-free EPO into the United States.

Finally, Columbia alleges that the export of the production clone by GI to Roche violates 35 U.S.C. § 271(f).¹⁰ Noting that this provision covers chemical compositions as well as machinery, Columbia contends that Roche incurred liability when GI shipped bulk EPO and EPO-producing cell lines to Germany because these exported components were later assembled with other chemicals into finished products that infringe.

Roche has filed the following three motions for summary judgment in rebuttal: (1) Defendant's Motion for Summary Judgment of Non-Infringement under 35 U.S.C. § 271 [docket entry # 250]; (2) Defendant's Motion for Summary Judgment of Non-Infringement of U.S. Patent Number 5,179,017 ("the '017 patent") [docket entry # 265]; and, (3) Defendant's Motion for Summary Judgment of Non-Infringement of Claims to Unlinked DNA Embodiments [docket entry # 268].

Roche's counter arguments that it did not infringe the Axel patents, either directly or vicariously, summarize as follows. First, it makes the general claim that whatever actions it took or activities it engaged in relative to Columbia's patents are insulated from liability because they all occurred outside the United States. Moreover, Roche maintains that nothing about its relationship with GI induced GI to engage in infringing conduct because, in contracting with GI to develop commercially feasible means of producing EPO, Roche claims that it had no control over the development processes that GI chose to utilize.

Apart from the inducement theory, Roche maintains that § 271(f), on its face, does not apply to Columbia's allegations since that provision is not directed to the export of a patented invention—here the EPO generating CHO host cells—but rather to the export of an unpatented component reassembled abroad in a manner that would infringe the patent if such combination occurred within the United States. Roche argues that Columbia's reliance on a 271(f) theory is misplaced because there is no evidence that Roche supplied or caused to be supplied the components of a patented invention so as to actively induce the combination of such components outside of the United States.

Second, with respect to the later, '017 patent, Roche argues that the facts indicate no allegedly infringing activities on the part of GI after 1991 (when GI was enjoined from manufacturing and selling recombinantly made EPO). In any event, as the '017 patent did not issue until 1993, any pre-issuance activities alleged by Columbia are not actionable as direct or induced patent infringement. Furthermore, Roche argues that Columbia has introduced no evidence of infringement of the '017 patent after 1993, i.e. post-issuance.

Finally, with respect to the two earlier Axel patents, the '216 and '665 patents, Roche claims there was no infringement of claims related to unlinked cotransformation processes. In light of this Court's Markman findings, Roche argues that the only claims that could conceivably be infringed by GI's activities are those restricted to linked cotransformation processes.

Columbia counters that Roche too narrowly characterizes my Markman findings. They contend that nothing in the patent language, this Court's claim interpretation, or the prosecution history of the patents restricts the claims of the '216 and '665 patents to linked cotransformation processes.

This Court entertained oral arguments on the various motions for summary judgment on Tuesday, February 28, 2001. Though the summary judgment motions were filed just prior to trial, and though they might otherwise blend rather neatly into the trial itself, I nevertheless agreed to consider them first, insofar as they might narrow the issues and tailor the scope of the suit. But, while I have found Roche's challenges to Columbia's case not insignificant, I cannot conclude on the record before me that summary judgment resolves the dispute in its entirety. Therefore, for the reasons stated herein, the motions are GRANTED in part and DENIED in part.

II. STANDARD FOR SUMMARY JUDGMENT

Fed.R.Civ.P. 56(c) provides, in pertinent part, that a court may grant summary judgment only if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." See Karlin Tech. Inc. v. Surgical Dynamics, Inc., 177 F.3d 968, 970 (Fed.Cir.1999).

In ruling on a summary judgment motion, the Court must view the record and draw inferences in a light most favorable to the non-moving party.¹¹ Rodime PLC v. Seagate Tech., Inc., 174 F.3d 1294, 1301 (Fed.Cir.1999). "When a party fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party bears the burden of proof at trial, there can no longer be a genuine issue as to any material fact ... and the moving party is entitled to judgment as a matter of law." Smith v. Stratus Computer, Inc., 40 F.3d 11, 12 (1st Cir.1994). This Court must, therefore, undertake to determine (1) whether factual disputes exist, (2) whether the factual disputes are genuine (i.e. a reasonable factfinder could return a verdict for the nonmoving party on the basis of the evidence), and, (3) whether any fact genuinely in dispute is material (i.e. such that it might affect the outcome of the suit under the applicable substantive law). See Anderson v. Liberty Lobby, 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

III. FACTS

A. GI's work and its search for "collaborators"

Beginning in April 1982, GI embarked on a project to isolate the EPO gene for purposes of cloning, insert it into host cells, and express it in those host cells....