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Intercept Pharmaceuticals Inc. v. Fiorucci

United States District Court, D. Delaware

September 28, 2017

INTERCEPT PHARMACEUTICALS, INC., Plaintiff,
v.
STEFANO FIORUCCI, Defendant.

          Thomas C. Grimm, Esq., Jeremy A. Tigan, Esq., Morris, Nichols, Arsht & Tunnel LLP, Wilmington, De, Ellen A. Scordino, Esq., Elizabeth Trafton, Esq., COOLEY LLP, Boston, MA, Ivor Elrifi, Esq., Jonathan Bach, Esq., Scott A. Sukenick, Esq., Cooley LLP, New York, NY, attorneys for Plaintiff Intercept Pharmaceuticals, Inc.

          George Pazuniak, Esq., O'KELLY & ERNST, LLC, Wilmington, DE, Glen M. Diehl, DIEHL LA w LLC, Watchung, NJ, attorneys for Defendant Stephano Fiorucci.

          MEMORANDUM OPINION

          ANDREWS, U.S DISTRICT JUDGE:

         Presently before the Court is Plaintiffs Motion for Partial Summary Judgment on the Issue of Inventorship (D.I. 97) and related briefing (D.I. 98, 114, 134), Defendant's Motion for Partial Summary Judgment on the Issue of Ownership (D.I. 100), and Plaintiffs Cross-Motion for Partial Summary Judgment on the Issue of Ownership (D.I. 111) and related briefing (D.I. 101, 112, 132). For the reasons that follow, Plaintiffs Motion for Partial Summary Judgment on the Issue of Inventorship (D.I. 97) and Plaintiffs Cross Motion for Partial Summary Judgment on the Issue of Ownership (D.I. 111) are GRANTED and Defendant's Motion for Partial Summary Judgment on the Issue of Ownership (D.I. 100) is DENIED.

         I. BACKGROUND

         Plaintiff, a biopharmaceutical company, develops and commercializes new drugs for treating disease. (D.I. 98 at 3). Plaintiff collaborates with medical research scientists in Italy, including Defendant and Dr. Pellicciari. (Id.). Plaintiff, Defendant, and the University where Defendant works collaborated under a series of agreements beginning in 2002. (D.I. 99-1 at Ex. A, Fiorucci Dep. 56:4-9, Nov. 13, 2015). The most recent of these agreements took effect in July 2006. (D.I. 104-1 at Ex. A, Ex. B). Under these agreements, Defendant worked on ligands to bind with the FXR and TGR5 proteins in liver cells. (D.I. 104-1 at Ex. A §1.4).

         A. THE PATENTS

         When Defendant began his relationship with Plaintiff, Dr. Pellicciari and Defendant worked together on compounds that would treat liver disease through the FXR receptor. (D.I. 44 at ¶ 9). Defendant performed tests to discover the properties and efficacy of the compounds. (Id.). Three patents arise out of the research on the FXR ligands: U.S. Patent No. 8, 546, 365 ("the '365 patent"), U.S. Patent No. 7, 932, 244 ("the '244 patent"), and U.S. Patent No. 7, 858, 608 ("the '608 patent") (collectively "the FXR patents"). (D.I. 44 at ¶ 9). Both Dr. Pellicciari and Defendant are named as joint inventors, and the patents are assigned to Plaintiff.

         In 2003, Dr. Pellicciari started developing chemical compounds to develop a TGR5 agonist, which would bind with the TGR5 receptor to treat metabolic and inflammatory diss. (D.I. 99-1 at Ex. E, Pruzanski Dep. 39:6-40:8, Apr. 28, 2016). Dr. Pellicciari began working with Plaintiff on the development of these compounds in 2006. (Id. at 50:9-16). Defendant was provided with the compounds in 2007 in order to screen the compounds and perform efficacy tests. (Id.). Plaintiff filed patents on the TGR5 compounds starting in 2009. (D.I. 44 at ¶ 17). There are five patents arising from the TGR5 research: U.S. Patent No. 8, 114, 862 ("the '862 patent"), U.S. Patent No. 8, 410, 083 ("the '083 patent"), U.S. Patent No. 8, 445, 472 ("the '472 patent"), U.S. Patent No. 8, 796, 249 ("the '249 patent"), and U.S. Patent No. 8, 999, 964 ("the '964 patent") (collectively "the TGR5 patents"). (D.I. 44 at ¶ 17). Dr. Pellicciari is named as the sole inventor on these patents, and all are assigned to Plaintiff.

         B. THE AGREEMENTS

         There are three agreements at issue: the 2006 Consulting Agreement ("the CA"), the 2006 Sponsored Research Agreement ("the SRA"), and a 2008 final Letter Agreement ("the LA"), which terminated the relationship between the parties. The SRA was executed contemporaneously with the CA. All three Agreements state that Delaware law shall apply. (D.I. 104-1 at Ex. A §7.8, Ex. B §8.13, Ex. D ¶ 11(d)).

         The C A was an agreement between Plaintiff and Defendant under which Defendant was hired by Plaintiff to work on ligands to bind to FXR, TGR5, and other proteins. (D.I. 104-1 at Ex. A §1.4). Under the CA, Defendant was to design and implement research plans, lead compound screening efforts, and coordinate patent preparation, among other responsibilities. (Id. Appendix A). Defendant assigned the rights to any inventions created during the term of the agreement to Plaintiff and agreed to execute any documents necessary to complete such assignment. (Id. §4.1). In return, Plaintiff was to pay Defendant a quarterly services fee and a yearly intellectual property fee. (Id. §§3.1, 3.2).

         The SRA was executed between Plaintiff, the University, and Defendant. The SRA defined "Research Parties" as the "University and Principal Investigator [i.e., Defendant] collectively or individually as the context requires." (D.I. 104-1 at Ex. B §1.4). The SRA repeatedly referred to both the "University, " the "Principal Investigator, " and the "Research Parties." Under the SRA, Defendant was to investigate ligands for the FXR and TGR5 proteins, in addition to ligands for other proteins. (Id. §2.1). Plaintiff, in return, would sponsor the research by paying a fee to the University and providing materials to Defendant. (Id. §2.4). The SRA also stated that the Research Parties would assign all rights in the project and all patent rights associated with the project to Plaintiff:

Research Parties hereby assign to Sponsor all rights title and interest in and to all Research Project Patent Rights and Research Project Technology upon creation, each such assignment to be effective as of the date of creation. Research Parties shall cooperate with Sponsor in providing assistance and executing any documentation necessary to perfect such assignment.. ..Each of the ...

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