MEMORANDUM OPINION AND ORDER
WILLIAM C. BRYSON, Circuit Judge.
Before the Court is a motion by defendant Teva Pharmaceuticals USA, Inc., ("Teva") to dismiss the complaint for lack of personal jurisdiction and improper venue. Dkt. No. 38. Also before the Court is the motion of Mylan Pharmaceuticals Inc. and Mylan Inc. (collectively, "the Mylan entities") to dismiss the complaint for failure to state a claim and for lack of personal jurisdiction and improper venue. Dkt. No. 32. Both motions are DENIED.
This patent infringement action arises from Abbreviated New Drug Applications ("ANDAs") submitted by Teva and Mylan to market generic versions of Allergan's cyclosporine ophthalmic emulsion product marketed as RESTASIS. RESTASIS is an eye drop treatment for chronic dry eyes.
Allergan is a pharmaceutical company. It is incorporated in the State of Delaware and has its principal place of business in California. It owns several patents relating to RESTASIS— United States Patent Numbers 8,629,111 ("the '111 patent"), 8,633,162 ("the '162 patent"), 8,642,556 ("the '556 patent"), 8,648,048 ("the '048 patent"), 8,685,930 ("the '930 patent"), and 9,248,191 ("the '191 patent"). Those patents are listed in the "Orange Book," the publication of the Food and Drug Administration ("FDA") that identifies approved drug products and lists the patents that are asserted to protect each drug.
Teva is a Delaware corporation with its principal place of business in Pennsylvania. It submitted an Abbreviated New Drug Application ("ANDA") to the FDA seeking regulatory approval for a generic cyclosporine ophthalmic emulsion product. As part of its ANDA, referred to as ANDA No. 203880, Teva included a certification (known as a "Paragraph IV certification,"
Mylan Pharmaceuticals is a West Virginia corporation with its principal place of business in West Virginia. It submitted an ANDA, referred to as ANDA No. 205894 seeking regulatory approval for a generic cyclosporine ophthalmic emulsion product. As part of ANDA No. 205894, Mylan Pharmaceuticals included a Paragraph IV certification that all of the patents in Allergan's Orange Book listing are invalid, not infringed, or unenforceable. On July 20, 2015, Mylan Pharmaceuticals sent a notification informing Allergan of ANDA No. 205894 and its position that the '111, '162, '556, '048, and '930 patents are invalid or not infringed.
Mylan Inc. is the parent company and owner of Mylan Pharmaceuticals. Dkt. No. 98, at ¶ 11. Mylan Inc. is a Pennsylvania corporation with its principal place of business in Pennsylvania. According to Allergan, Mylan Inc. is responsible for marketing and selling the generic drugs manufactured and supplied by Mylan Pharmaceuticals. Dkt. No. 96, at ¶ 49. Allergan also alleges that "Mylan Pharmaceuticals and Mylan Inc. are agents of each other and/or work in active concert with respect to the development, regulatory approval, marketing, sale and distribution of pharmaceutical products," including the product at issue in this litigation.
On August 24, 2105, Allergan filed this action against Teva, the Mylan entities, and others, alleging that the proposed generic drugs would infringe one or more of the '111, '162, '556, '048, and '930 patents. Allergan later amended its complaint to include the '191 patent after that patent issued. Teva and the Mylan entities filed motions to dismiss for lack of personal jurisdiction and venue. Mylan Inc. also filed a motion to dismiss for failure to state a claim, arguing that Allergan failed to plausibly allege that it was the submitter of ANDA No. 205894.
A. Personal Jurisdiction
This Court may assert personal jurisdiction over a non-resident defendant if the defendant "is subject to the jurisdiction of a court of general jurisdiction in the state where the district court is located," which in this case is Texas.
There are two independent bases for the exercise of personal jurisdiction over a defendant—general and specific. General personal jurisdiction is available when the defendant's contacts with the forum State are "continuous and systematic." In such cases, the court in the forum State may exercise personal jurisdiction over the defendant even if the cause of action does not arise from or relate to activities conducted within that State.
For patent cases, the due process elements of personal jurisdiction are governed by Federal Circuit law.
Because the Federal Circuit issued the
The Mylan entities, on the other hand, argued that "the Federal Circuit's decision should have no immediate impact on Mylan's pending Motion to Dismiss." Dkt. No. 111, at 1. Their position does not appear to be based on any factual distinction between
The Court has specific personal jurisdiction over the Mylan entities because the purpose of their ANDA submission is to market a generic drug nationwide, including in Texas. Allergan has made plausible allegations that if the Mylan entities were to receive FDA approval, they would sell a generic cyclosporine ophthalmic emulsion product in Texas and in this district. Allergan has alleged that Mylan Pharmaceuticals is licensed to distribute drugs in the State of Texas and is actively registered to do business in Texas. Dkt. No. 96, at ¶¶ 46-47. Allergan has also alleged that since 2014 Mylan Inc. has sold more than $1.3 billion of Mylan Pharmaceuticals' products in Texas, including $460 million in the Eastern District.
The Mylan entities have described Allergan's allegations that they would sell in Texas as "nothing more than baseless allegations," and they argue that "[i]t is entirely speculative that [Mylan Pharmaceuticals] would ever sell an infringing generic product in Texas." Dkt. No. 63, at 5-6. However, the Mylan entities have not represented that they will not sell nationally, including in Texas, if they receive FDA approval. Nor have they offered any reason to believe that it is at all likely that they would sell their product in some States, but not in Texas. To the contrary, it seems highly unlikely that they would undergo the considerable effort and expense of preparing an ANDA filing and litigating this case if they did not intend to market and distribute the drug throughout the United States, including in the second largest State in the nation. The mere assertion that the possibility of such sales is "speculative" is not enough to answer Allergan's allegations.
After a plaintiff makes a showing of minimum contacts with the forum, the defendant has an opportunity to address whether the court asserting jurisdiction "would comport with fair play and substantial justice."
Because Allergan has made an uncontroverted showing of suit-related minimum contacts in this case and the Mylan entities have not made a showing of other considerations that would cut against the exercise of specific personal jurisdiction, this Court concludes that it has specific personal jurisdiction over them.
The parties also dispute whether this court has general personal jurisdiction over Teva and the Mylan entities. Because the Court has found that it has specific personal jurisdiction over the defendants in this case, it need not address general personal jurisdiction.
Allergan has asserted that venue in the Eastern District of Texas is proper with regard to both defendants under 28 U.S.C. §§ 1391(c) and 1400(b). Under section 1400(b), venue is proper "in the judicial district where the defendant resides." 28 U.S.C. § 1400(b). Section 1391(c)(2) provides that a corporation "shall be deemed to reside, if a defendant, in any judicial district in which such defendant is subject to the court's personal jurisdiction with respect to the civil action in question." In a State which has more than one judicial district, and in which a defendant that is a corporation is subject to personal jurisdiction at the time the action is commenced, such corporation shall be deemed to reside in any district in that State within which its contacts would be sufficient to subject it to personal jurisdiction if that district were a separate State." 28 U.S.C. § 1391(d).
In this case, the Mylan entities do not make a freestanding venue argument. Rather, they argue that because this Court does not have personal jurisdiction over them, venue in this district is improper as well. Dkt. No. 63, at 10. Because this Court has personal jurisdiction over the Mylan entities, their venue argument fails. In addition, because of the $460 million of RESTASIS sales that Allergan has alleged take place in the Eastern District, Allergan would be able to establish minimum contacts with the district as well.
Teva concedes that, in light of the
C. Dismissal for Failure to State a Claim
Federal Rule of Civil Procedure 12(b)(6) authorizes a court to dismiss a complaint if the complaint "fail[s] to state a claim upon which relief can be granted." The question resolved on a motion to dismiss for a failure to state a claim is not whether the plaintiff will ultimately prevail, "but whether [the] complaint was sufficient to cross the federal court's threshold."
Upon viewing the pleaded facts most favorably to the plaintiff, the court must then decide whether those facts state a claim for relief that is plausible on its face.
The plausibility standard "does not give district courts license to look behind [a complaint's] allegations and independently assess the likelihood that the plaintiff will be able to prove them at trial."
The Mylan entities argue that Allergan fails to state a claim against Mylan Inc. because Mylan Inc. was not the entity that submitted the ANDA application. The Hatch-Waxman Act makes it "an act of infringement to submit" an ANDA on a drug covered by valid and infringed patents found in the Orange Book listing for a drug. 35 U.S.C. § 271(e)(2). An entity submits an ANDA if it participates in the preparation of the ANDA and intends to benefit directly from the ANDA by selling the ANDA product upon approval.
Mylan Inc. argues that it is not a submitter because Mylan Pharmaceuticals "prepared and submitted the ANDA," and Mylan Inc. did not. Dkt. No. 32, at ¶¶ 45. However, Allergan has alleged that "Mylan Pharmaceuticals and Mylan Inc. are agents of each other and/or work in active concert with respect to the development, regulatory approval, marketing, sale and distribution of pharmaceutical products," including the drug at issue in this case. Dkt. No. 96, at 8. Allergan has also alleged that Mylan Inc. markets and sells the drugs manufactured by Mylan Pharmaceuticals.
IT IS SO ORDERED.