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Allergan, Inc. v. Teva Pharmaceuticals USA, Inc.

United States District Court, E.D. Texas, Marshall Division

April 27, 2017

ALLERGAN, INC., Plaintiff,
v.
TEVA PHARMACEUTICALS USA, INC., et al., Defendants.

         LEAD CASE

          MEMORANDUM OPINION AND ORDER

          WILLIAM C. BRYSON UNITED STATES CIRCUIT JUDGE

         Before the Court is Defendants' Motion for Leave to Amend Invalidity Contentions (“Motion to Amend”), Dkt. No. 303. The Motion to Amend is GRANTED, and the parties are directed to meet and confer regarding appropriate fact discovery related to the subject matter of the motion, as discussed below.

         BACKGROUND

         The defendant pharmaceutical companies are seeking approval by the Food and Drug Administration to sell a generic version of Restasis, an ophthalmic product sold by plaintiff Allergan, Inc. On August 24, 2015, Allergan filed a patent infringement action under the Hatch-Waxman Act against defendants Teva Pharmaceuticals USA, Inc.; Akorn, Inc.; Mylan Pharmaceuticals, Inc.; and Mylan, Inc., alleging infringement of several Allergan patents related to Restasis. Allergan, Inc. v. Teva Pharmaceuticals USA, Inc., No. 2:15-cv-1455 (E.D. Tex.). Allergan later filed related actions against defendants Innopharma, Inc., and Famy Care Limited. Allergan, Inc. v. Innopharma, Inc., No. 2:15-cv-1504 (E.D. Tex., filed Sept. 8, 2015); Allergan, Inc. v. Famy Care Ltd., No. 2:16-cv-401 (E.D. Tex., filed April 12, 2016). The latter two actions were consolidated with case no. 2:15-cv-1455.

         The defendants asserted anticipation and obviousness defenses based on two patents issued to Dr. Shulin Ding, who worked for Allergan as a formulator from 1987 to 1998. See Dkt. No. 303-2, at 9. During the discovery period, Allergan turned over documents related to Dr. Ding's work on cyclosporin treatments. In March 2016, Allergan produced Dr. Ding's 1997 Technical Report entitled “Technology Transfer Report for Phase III Manufacture of Cyclosporine 0.1% and 0.05% Ophthalmic Emulsions, ” as well as a draft technical report entitled “Freeze to Thaw and Low to High Cycling Studies Report for Cyclosporine Ophthalmic Emulsion Formulations 8735X and 9054X.” See Dkt. No. 315-1. In September 2016, Allergan produced the laboratory notebook of Toan Ha, who worked under Dr. Ding. See Dkt. No. 315-2.

         In January 2017, the defendants deposed several witnesses regarding Dr. Ding's involvement in Allergan's development of Restasis. See, e.g., Dkt. No. 314-2, at 33, 51. On January 16, 2017, the defendants noticed Dr. Ding's deposition and served a subpoena for the production of documents related to her work on the development of Restasis. See Dkt. No. 314, at 4.

         Fact discovery closed on February 10, 2017. See Dkt. No. 269, at 2. The defendants deposed Dr. Ding on February 24, 2017, as she had not been available before then, see Dkt. No. 314, at 4. Additional materials were produced to the defendants the day before her deposition, including a copy of the previously produced draft technical report, but with Dr. Ding's handwritten notes on it. Dkt. No. 303, at 6-7.

         On March 20, 2017, the defendants notified Allergan that they intended to seek leave to add a new invalidity theory of incorrect inventorship under 35 U.S.C. § 102(f). Allergan opposed the amendment. See Dkt. No. 314, at 4.

         The deadline for the parties to amend their pleadings was June 9, 2016. Dkt. No. 137, at 3.[1] The defendants filed their Motion to Amend on March 24, 2017.

         DISCUSSION

         Once a scheduling order has been entered in a case and a deadline has been set for filing amended pleadings, the decision whether to permit a post-deadline amendment is governed by Fed.R.Civ.P. 16(b). See Squyres v. Heico Companies, L.L.C., 782 F.3d 224, 237 (5th Cir. 2015); EEOC v. Serv. Temps Inc., 679 F.3d 323, 333-34 (5th Cir. 2012); L.G. Motorsports, Inc. v. NGMCO, Inc., No. 4:11-cv-112, 2013 WL 2543398, at *6 (E.D. Tex. June 6, 2013). Under Rule 16(b)(4), a motion to modify the scheduling order by permitting the filing of an amended pleading after the deadline in the scheduling order may be granted “only for good cause and with the judge's consent.”

         The party seeking to modify a scheduling order has the burden to show good cause. Squyres, 782 F.3d at 237; Self v. Quinn's Rental Servs. (USA), LLC, Civil Action No. H-15-1569, 2016 WL 6835093, at *1 (S.D. Tex. Nov. 21, 2016). Moreover, the Fifth Circuit has held that Rule 16 gives trial courts “broad discretion to preserve the integrity and purpose of the pretrial order.” Geiserman v. MacDonald, 893 F.2d 787, 790 (5th Cir. 1990) (quoting Hodges v. United States, 597 F.2d 1014, 1018 (5th Cir. 1979)). The Fifth Circuit has directed that in deciding whether to permit amendments to the pleadings after the deadline for such amendments, district courts should consider “(1) the explanation for the party's failure to [timely move for leave to amend]; (2) the importance of the [amendment]; (3) potential prejudice in allowing the [amendment]; and (4) the availability of a continuance to cure such prejudice.” United States ex rel. Bias v. Tangipahoa Parish Sch. Bd., 816 F.3d 315, 328 (5th Cir. 2016) (quoting S&WEnters., L.L.C. v. SouthTrust Bank of Ala., N.A., 315 F.3d 533, 536 (5th Cir. 2003) ...


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