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CSL Behring, LLC v. Bayer Healthcare, LLC

United States District Court, D. Delaware

January 23, 2019

CSL BEHRING, LLC, Plaintiff,
v.
BAYER HEALTHCARE, LLC, Defendant.

          MEMORANDUM

         Plaintiff CSL Behring and Defendant Bayer Healthcare are competitors in the market for recombinant Factor VIII, a human blood factor used to treat hemophilia A patients. They are parties to a Supply and License Agreement (the "Supply Agreement") (D.I. 32-1) that memorializes Bayer's obligation to supply CSL with recombinant Factor VIII. The parties have asserted claims and counterclaims against each other for breach of the Supply Agreement and other related torts. Currently pending before the court is CSL's Motion to Dismiss Counts Two and Three of Bayer's Counterclaims and Bayer's Request for Attorneys' Fees. (D.I. 31). The court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 1331 and 1338(a). For the reasons discussed below, CSL's motion to dismiss is granted in part and dismissed in part.

         I. BACKGROUND

         A. The Parties' Relationship

         The Supply Agreement is governed by New York law and terminated by its own terms on December 31, 2017. (D.I. 32-1 at §§ 7.1, 11.2). Under the Supply Agreement, Bayer agreed to manufacture and supply CSL with two human recombinant Factor VIII products that CSL sold under the trade names "Helixate" and "Iblias." (D.I. 27, Counterclaims at ¶¶ 7-8). Bayer concurrently made and sold the same products for itself under the trade names "Kogenate" and "Kovaltry." (Id.). In May 2016, CSL obtained FDA approval of its own human recombinant Factor VIII product that competes with Helixate and is sold under the trade name "Afstyla." (Id. at ¶¶ 34, 68).

         B. Relevant Terms of the Supply Agreement

         The counterclaims that CSL seeks to dismiss essentially allege that CSL was obligated to purchase and sell as much Helixate as the market would buy. The Supply Agreement contains two provisions relevant to these claims. First, there is a "minimum purchase obligation," found in Section 2.2.3.2 of the Supply Agreement, which states: "For Calendar Year 2011 and beyond, CSL's minimum purchase obligation will be sixty percent (60%) of the previous Calendar Year's actual purchase." (D.I. 32-1 at § 2.2.3.2). Second, there is a mechanism set forth in Section 2.3.1 by which CSL provides Bayer, on a monthly basis, rolling forecasts that govern CSL's future orders. (Id. at § 2.3.1). The first three months of each forecast are considered a "firm order." (Id.).

         The second three months (i.e., months four through six) cannot change by more than 15% when those months become firm orders. (Id.). Specifically, Section 2.3.1 states, in relevant part:

CSL shall provide Bayer with a rolling twelve (12) month forecast of its requirements of Product broken down by calendar months..... The first three (3) calendar months of this forecast shall represent a firm order .... The second three (3) calendar months of this forecast may not change more than plus or minus fifteen percent (15%) from the immediately preceding twelve (12) month forecast when the second three (3) months of the immediately preceding forecast are upgraded to the status of a firm order.

(Id.).

         Finally, Bayer has requested attorneys' fees in its Prayer for Relief. (D.I. 27 at 37). Section 9.1 of the Supply Agreement governs attorneys' fees and provides, at least in some circumstances, that a prevailing party is entitled to recover its litigation costs if the litigation involves a request for equitable relief. Specifically, Section 9.1 states:

Except in cases where a party seeks equitable relief in a court of competent jurisdiction to avoid irreparable injury, the parties hereto shall first attempt to settle by good faith negotiation any dispute, controversy or claim arising out of or relating to this Agreement ("Dispute"). In the event that a party seeks such equitable relief, the prevailing party shall be entitled to recover from the non-prevailing party all reasonable out-of-pocket costs and expenses incurred in such litigation.

(D.I. 32-1 at §9.1).

         II. STANDARD OF REVIEW

         Under Rule 12(b)(6), a party may move to dismiss a complaint for failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). To survive the motion to dismiss, the complaint must contain sufficient factual matter "to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal,556 U.S. 662, 677-78 (2009) (quoting Bell Atl. Corp. v. Twombly,550 U.S. 544, 570 (2007)). The factual allegations do not have to be detailed, but they must provide more than labels, conclusions, or a "formulaic recitation" of the claim elements. Twombly, 550 U.S. at 555. In assessing the plausibility of a claim, the court must accept all well-pleaded factual allegations in the complaint as true and draw all reasonable inferences in favor of the plaintiff. In re Rockefeller Ctr. Prop., Inc. Sec. Litig., 311 F.3d 198, 215 (3d Cir. 2002). The court's review is limited to the ...


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