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UCB, Inc. v. Mylan Technologies, Inc.

United States District Court, D. Delaware

December 1, 2017




         Pending before the Court are Defendants Mylan Technologies, Inc. ("MTI"), Mylan Pharmaceuticals Inc. ("MPI"), and Mylan, Inc.'s ("Inc., " and collectively with MTI and MPI, "Mylan" or "Defendants") motion to dismiss for improper venue (D.I. 13) and Plaintiffs UCB, Inc., UCB Manufacturing Ireland Limited, UCB Pharma GmbH, and LTS Lohmann Therapie-Systeme AG's (collectively, "UCB" or "Plaintiffs") conditional motion to transfer the case to the District of Vermont (D.I. 22). Having considered the parties' motion briefing (D.I. 14, 23, 26) and letter briefing in response to the Court's September 11, 2017 Oral Order (D.I. 35, 36, 37, 38), and for the reasons stated below, IT IS HEREBY ORDERED that Mylan's motion to dismiss (D.I. 13) and UCB's motion to transfer (D.I. 22) are DENIED WITHOUT PREJUDICE to renew after a period of venue-related discovery. IT IS FURTHER ORDERED that the parties shall meet and confer and, no later than December 8, 2017, submit a joint status report with their position(s) as to the scope and timing of the discovery to be taken pursuant to this Order.

         The Venue Defense Was Not Forfeited

         As an initial matter, Mylan's venue challenge is not untimely. As the Court of Appeals for the Federal Circuit recently held, "[t]he Supreme Court changed the controlling law when it decided TC Heartland[1]in May 2017." In re Micron Tech., Inc., F.3d, 2017 WL 5474215, at *6 (Fed. Cir. Nov. 15, 2017). Therefore, "[t]he venue objection was not available until the Supreme Court decided TC Heartland because, before then, it would have been improper, given controlling precedent, for the district court to dismiss or to transfer for lack of venue." Id. at *3.

         Nor does the Court find that Mylan forfeited its challenge to venue due to its conduct in this litigation. See Micron, 2017 WL 5474215, at *7 ("[D]istrict courts have authority to find forfeiture of a venue objection."); Boston Sci. Corp. v. Cook Grp. Inc., 2017 WL 3996110, at *9 (D. Del. Sept. 11, 2017) ("Prototypical examples of where the Court might reach such a conclusion [that a defendant has forfeited its venue challenge] include whether a defendant raises venue for the first time on the eve of trial, or many months (or years) after TC Heartland was handed down, or where dismissal or transfer would unduly prejudice a plaintiff. Or a party may have taken affirmative steps in the litigation that should, in particular circumstances, be viewed as essentially estopping that party from prevailing on an improper [venue] defense.") (internal citations omitted).

         Plaintiffs filed their complaint on March 24, 2017. (D.I. 1) In its answer, filed on April 19, 2017, Mylan contended that venue was not proper in this District (D.I. 8 at 4, 20), which put Plaintiffs (and the Court) on notice that Mylan believed it should not have to litigate this case in Delaware. Then, on July 13, 2017, less than two months after TC Heartland was decided, Mylan filed its pending motion to dismiss, due to improper venue, pursuant to Federal Rule of Civil Procedure 12(b)(3). Trial in this case has not yet been scheduled and the 30-month stay on FDA approval of Mylan's AND A for its generic drug product does not expire until August 2019 (D.I. 3).

         The Court discerns nothing in Mylan's participation in this litigation that should be deemed as having forfeited a now potentially-meritorious venue objection. See Micron, 2017 WL 5474215, at *7-8 (identifying non-exclusive bases on which forfeiture of venue challenge may be found, including "untimeliness or consent, " "submission through conduct, " and where objection "was not made until long after" change in law "took effect") (internal quotation marks omitted). Nor does the Court's conclusion of no forfeiture threaten Plaintiffs with any undue prejudice, particularly given that the Court has not yet scheduled the trial date. Regardless of which side has the burden with respect to waiver, forfeiture, and estoppel, the Court finds that none of these doctrines here precludes Mylan from proceeding with its challenge to venue in this case.[2]

         Defendants Are Not Delaware Residents for Purposes of Patent Venue

         Venue in a patent case is governed exclusively by 28 U.S.C. § 1400(b), TC Heartland, 137 S.Ct. at 1516, which provides: "[a]ny civil action for patent infringement may be brought in the judicial district where the defendant resides, or where the defendant has committed acts of infringement and has a regular and established place of business." For purposes of § 1400(b), a defendant which is a domestic corporation "resides" only in its state of incorporation. See TC Heartland, 137 S.Ct. at 1517. It is undisputed that MTI, MPI, and Inc. - which are, respectively, incorporated in West Virginia, West Virginia, and Pennsylvania (D.I. 15 ¶¶ 3, 10, 15) - do not "reside" in Delaware.

         Venue Is Potentially Proper Here Under the Second Prong of § 1400(b)

         Venue is proper in this District unless Mylan can show that the second prong of § 1400(b) is not satisfied. See Bristol-Myers Squibb Co. v. Mylan Pharm. Inc., 2017 WL 3980155, at *5 (D. Del. Sept. 11, 2017) ("BMS") (holding that burden is on party opposing venue). That is, Delaware is a proper venue for this lawsuit unless Mylan can meet its burden to show either that (i) a defendant has not committed acts of infringement in Delaware, or (ii) a defendant does not have a regular and established place of business in Delaware. If Mylan can show either of the foregoing is true with respect to one or more of the Defendants, then venue here is improper with respect to such Defendant(s), and the Court will have to dismiss or transfer this case (at least as to one or more Defendants). Mylan contends it has met its burden with respect to both requirements of this second prong of § 1400(b).

         The First Requirement: Acts of Infringement

         Mylan has failed to show that any of the Defendants has not committed acts of infringement in Delaware, given the Court's understanding of the meaning of this statutory requirement in the context of Hatch-Waxman litigation. See BMS, 2017 WL 3980155, at *12 (holding that "acts of infringement" in this context include acts "the ANDA applicant non-speculatively intends to take if its ANDA receives final FDA approval, plus steps already taken by the applicant indicating its intent to market the ANDA product in this District").[3] Mylan gives the Court no persuasive reason to reconsider this determination.

         The Second Requirement: Regular and Established Place of ...

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