Case: 1:16-cv-00651 Document #: 87 Filed: 01/23/18 Page 1 of 9 PageID #:2536
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE NORTHERN DISTRICT OF ILLINOIS
`EASTERN DIVISION
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`HOSPIRA, INC.,
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`FRESENIUS KABI USA, LLC,
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`Plaintiff,
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`Defendant.
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`v.
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`Civil Action Nos. 16-cv-651
` 17-cv-7903
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`Hon. Judge Rebecca R. Pallmeyer
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`HOSPIRA’S REPLY IN SUPPORT OF ITS
`MOTION TO STRIKE UNTIMELY INVALIDITY THEORIES
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`Fresenius Kabi does not dispute that it disclosed its IND invalidity theories for the first
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`time only a few weeks ago. It does not dispute that the IND theories are substantial and will
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`change the trial materially. Nor does it dispute that the documents underlying its new theories
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`have been in its possession for well over a year. And, aside from one unsupported assertion (D.I.
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`84 (“Opp.”) at 5), Fresenius Kabi does not seriously argue that its new theories were born out of
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`the Court’s November 2017 claim construction ruling. Instead, Fresenius Kabi offers a list of
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`thin excuses to justify its untimely injection of four new invalidity theories into the case, on the
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`heels of its push to put this case on an accelerated track towards trial in a few months’ time. The
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`Court should strike the new defenses.
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`Case: 1:16-cv-00651 Document #: 87 Filed: 01/23/18 Page 2 of 9 PageID #:2537
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`I.
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`FRESENIUS KABI’S NEW THEORIES SHOULD BE STRUCK
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`Fresenius Kabi’s parade of excuses do not justify its failure to disclose the new IND
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`theories in a timely manner. In sum:
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`1. Fresenius Kabi claims that its theories of public use and public sales based on the
`IND became available only after a May 2017 Federal Circuit panel ruling created
`“new intervening law.” (Opp. at 4-5.) The law that Fresenius Kabi cites is not
`relevant to our upcoming trial in this case.
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`2. Likely sensing that its “intervening law” argument would not account for the eight
`months that elapsed between that ruling and its new contentions, Fresenius Kabi
`argues that Hospira’s August 2017 Delaware trial against Amneal created the
`opportunity to assert the new defenses. (Id. at 2.) But that trial had nothing to do
`with the new IND theories.
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`3. Fresenius Kabi argues that it was handcuffed from disclosing its theories because
`discovery was closed until the Court issued its claim construction ruling in November
`2017. (Id. at 1, 3.) This is inaccurate and is not a justifiable excuse.
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`4. Fresenius Kabi argues that discovery following the claim construction ruling is
`unlimited and so its actions are justified. (Id. at 1.) That is contrary to the Local
`Rules and makes no sense given Fresenius Kabi’s push for an expedited case
`schedule.
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`5. It contends that even if discovery after claim construction is limited, Hospira must
`meet an extraordinarily high burden to strike the new theories. (Id. at 6.) But that is
`the incorrect standard.
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`6. Finally, Fresenius Kabi contends that Hospira could simply throw up its hands and
`offer no response if it wishes not to suffer the prejudice of scrambling to prepare its
`case on the four new theories. (Id. at 9-11.) That is the very definition of prejudice.
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`A.
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`There Is No Good Cause For Fresenius Kabi’s Untimely Disclosure.
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`Fresenius Kabi should have disclosed its IND theories over a year ago. It is simply too
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`late to raise them now, and Fresenius’s excuses do not justify its delay.
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`1.
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`Helsinn Did Not Create New Law In May 2017.
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`Fresenius Kabi argues that the Helsinn case is “new intervening law” justifying the late
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`disclosure of its new defenses. (Opp. at 4-5.) But the part of the Helsinn panel opinion that is
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`arguably “new” concerns the post-AIA version of the patent laws, which does not apply to the
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`2
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`Case: 1:16-cv-00651 Document #: 87 Filed: 01/23/18 Page 3 of 9 PageID #:2538
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`patents-in-suit here. See, e.g., Helsinn Healthcare S.A. v. Teva Pharm. USA, Inc., 855 F.3d
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`1356, 1368 (Fed. Cir. 2017) (“Teva and various amici assert that by reenacting the existing
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`statutory term, ‘on sale,’ Congress did not change the meaning of the on-sale bar or disturb
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`settled law. Helsinn, the government, and other amici argue that the AIA changed the law by
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`adding the ‘otherwise available to the public’ phrase.”). By contrast, the part of Helsinn that is
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`relevant to Fresenius Kabi’s new defenses simply applies precedent concerning the on-sale bar
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`under pre-AIA patent law. See id. at 1364 (“We recently had occasion to address the pre-AIA
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`on-sale bar en banc in Medicines Co. v. Hospira [dated July 11, 2016]. There we established a
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`framework for determining whether there is an offer for sale. . . . We agree with the district
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`court that there was a sale for purposes of pre-AIA § 102(b) prior to the critical date because
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`there was a sale of the invention under the law of contracts as generally understood.”).
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`Therefore, Fresenius Kabi’s reliance on Helsinn as justifying its delay is meritless.
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`2.
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`The August 2017 Amneal Trial Had Nothing To Do With Fresenius
`Kabi’s New IND Defenses.
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`Fresenius Kabi’s claim that “Hospira took unanticipated positions” in the Amneal trial
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`that somehow led to the IND defenses is baseless. (Opp. at 2.) Only a very limited portion of
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`the IND was discussed at that trial and, even then, it was in the limited context of Amneal’s
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`alleged inherency defense (which Judge Andrews ruled against)—not prior use or prior sale.
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`(D.I. 119 at 31-34, Case No. 15-697-RGA (D. Del.).) Furthermore, Hospira’s observation at the
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`Amneal trial that the IND is not prior art (Opp. at 2) does not support Fresenius Kabi’s new
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`theory that the IND is prior art now, especially when Hospira has never argued otherwise.1 In
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`1 Similarly, Hospira’s September 2017 production to Fresenius Kabi of expert reports from the
`Amneal case is irrelevant. (See Opp. at 2.) Because the Amneal case did not involve the on-sale
`and prior use IND theories that Fresenius Kabi now seeks to assert, the experts did not offer
`opinions relevant to these new IND theories.
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`3
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`Case: 1:16-cv-00651 Document #: 87 Filed: 01/23/18 Page 4 of 9 PageID #:2539
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`the end, Hospira’s trial last August does not provide an excuse for Fresenius Kabi’s late assertion
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`of these new theories.
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`3.
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`Fresenius Kabi Was Required to Seek Leave To Amend Its
`Contentions While The Court Prepared Its Claim Construction
`Ruling.
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`Fresenius Kabi declares that discovery was “halted” until the Court’s claim construction
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`ruling, so it was powerless to disclose its new theories until the Court’s ruling in November
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`2017. (Opp. at 1, 3.) It further suggests that “there was no reason to insist upon piecemeal
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`supplementations before and after the ruling.” (Opp. at 3.) Fresenius Kabi is wrong to use the
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`Court’s claim construction ruling as a reason to lie in wait, while at the same time arguing for an
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`expedited trial date.
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`4.
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`Hospira Did Not Agree to Open Season on New Contentions and
`Discovery.
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`The Local Patent Rules make clear that post-claim construction discovery is limited to
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`issues raised by the claim construction ruling. L.P.R. 1.3 Comment (“The Rule states that
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`resumption of fact discovery upon entry of a claim construction ruling ‘may occur.’ The Rule
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`does not provide that discovery shall automatically resume as a matter of right. It is intended
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`that parties seeking further discovery following the claim construction ruling shall submit a
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`motion explaining why further discovery is necessitated by the claim construction ruling.”)
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`While Fresenius Kabi would fault Hospira for “assum[ing] restrictions on what supplementation
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`should be allowed” (Opp. at 1, 4), the onus was upon Fresenius Kabi to seek and obtain leave for
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`the much broader contentions and discovery it desires.2 This is particularly so where Fresenius
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`Kabi’s new contentions drastically change the nature and scope of the case, from one about
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`2 In any event, Hospira did express that discovery should be limited, “given the substantial
`discovery already completed in this case.” (D.I. 78.)
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`4
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`Case: 1:16-cv-00651 Document #: 87 Filed: 01/23/18 Page 5 of 9 PageID #:2540
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`alleged obviousness based on prior art literature to one about alleged prior sale and prior use
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`based on decades-old confidential work involving a Finnish company and other predecessor
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`companies.
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`Fresenius Kabi never hinted that its supplementations would be this extensive. To the
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`contrary, and even in the communications upon which it relies, Fresenius Kabi indicated that its
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`contentions would relate to the claim construction ruling or the two new related patents that had
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`been added to the case after the claim construction ruling. (See Opp. Ex. A at 1 (“Fresenius Kabi
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`would prefer to reopen fact discovery to amend its contentions and issue written discovery based
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`on the ruling, if needed.” (emphasis added)); Opp. Ex. B at 3:15-22 (“A lot of it depends on the
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`claim construction ruling because we may also need to amend our contentions based on that.”
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`(emphasis added)); see also D.I. 65 (parties requesting a status conference to “provide guidance
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`about possible additional discovery that may be needed upon entry of a claim construction
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`ruling”).)
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`Hospira’s amended infringement contentions reflect the limited scope of additional
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`discovery following the claim construction ruling. Most of Hospira’s infringement contentions
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`remained unchanged, and Amneal points to only one claim limitation where Hospira
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`supplemented its contentions. (Opp. at 7-9 (discussing four “paragraphs” from Hospira’s
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`contentions).) But some reasonable supplementation over the course of litigation is customary;3
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`Hospira’s amended contentions simply include updated stability data that Fresenius Kabi
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`produced after Hospira served its final contentions (the “first paragraph” of the amended
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`contention), and disclosed a legal argument under the Federal Circuit’s Sunovion decision (the
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`3 For this reason, Hospira did not seek to strike other new invalidity theories raised in Fresenius
`Kabi’s amended contentions. (See D.I. 81 at 5-7.)
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`5
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`Case: 1:16-cv-00651 Document #: 87 Filed: 01/23/18 Page 6 of 9 PageID #:2541
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`remaining three paragraphs). The Sunovion argument requires no new discovery or investigation
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`by Fresenius Kabi because it is a legal argument based solely on Fresenius Kabi’s product
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`specification. Moreover, Fresenius Kabi is not surprised by this argument, which was discussed
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`numerous times at the Amneal trial that Fresenius Kabi has been monitoring. Tellingly, nowhere
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`does Fresenius Kabi contend that Hospira’s amended contentions surprised it or require any
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`further investigation. (See Opp. at 7-9.)
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`5.
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`Local Patent Rule 3.4 Governs.
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`As discussed in Hospira’s opening brief, the Local Patent Rules are also clear that a party
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`seeking to amend its final contentions must show “good cause and absence of unfair prejudice . .
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`. promptly upon discovery of the basis for the amendment.” L.P.R. 3.4. Fresenius Kabi was not
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`prompt and no good cause exists. So Fresenius Kabi seeks to avoid that standard in favor of the
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`standard in Federal Rule of Civil Procedure 12(f), which concerns striking “from a pleading an
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`insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.” Fed. R.
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`Civ. P. 12(f). But there is no pleading at issue here. This dispute is about revisions to final
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`contentions pursuant to the Local Patent Rules of this District, not pleadings. The Local Rules
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`speak directly to the situation here: “Amendment of Final Contentions,” L.P.R. 3.4, and that
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`standard applies to this dispute. See, e.g., AVNET, Inc. v. MOTIO, Inc., 2016 WL 3365430, at *3
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`(N.D. Ill. June 15, 2016) (granting motion to strike under the L.P.R. 3.4 standard); Sycamore IP
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`Holdings LLC v. AT&T Corp., 2017 WL 4517953 (E.D. Tex. Oct. 10, 2017) (granting motion to
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`strike new infringement theories from expert reports under good cause / prejudice standard).
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`Even the case cited by Fresenius Kabi observed that L.P.R. 3.4 is “the primary rule governing”
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`whether amendments to contentions comply with a grant of leave. Sloan Valve v. Zurn Indus.,
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`Inc., 2012 WL 6214608, at *2 (N.D. Ill. Dec. 13, 2012).
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`6
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`Case: 1:16-cv-00651 Document #: 87 Filed: 01/23/18 Page 7 of 9 PageID #:2542
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`Perhaps predicting that its argument regarding application of Federal Rule 12(f) would
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`fail, Fresenius Kabi argues that the Court already granted leave under the Local Patent Rules.
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`(Opp. at 5.) But, as discussed above, any leave was not meant for wholesale introduction of new
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`theories. And Fresenius Kabi’s focus on the fact that the instant motion is “styled [as] a motion
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`to strike” (Opp. at 5) elevates form over substance. If what Fresenius Kabi argues here became
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`accepted practice, it would encourage parties to unilaterally amend contentions with no leave of
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`court or, just as bad, obtain a limited leave and then ignore the limitations. Under Fresenius
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`Kabi’s reading of the law, the opposing party would have essentially no recourse in such
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`situations. That would make no sense.
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`B.
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`The Prejudice To Hospira Is Substantial
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`Finally, Fresenius Kabi seeks to downplay its addition of four new theories to a case
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`already on an accelerated schedule by suggesting that the new defenses “put no new burdens on
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`Hospira.” (Opp. at 9.) This is plainly inaccurate. The IND defenses involve a decades-old,
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`2,000-page Investigational New Drug Application from a Finnish company, plus alleged
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`activities and transactions that took place between that Finnish company and Abbott
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`Laboratories, a company from which Hospira separated over ten years ago. Investigation of this
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`new defense cannot be completed in the nineteen days provided for Hospira to respond to
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`Fresenius Kabi’s invalidity contentions, or even by the March 2 deadline for Hospira’s expert
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`reports on this issue.
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`Fresenius Kabi’s suggestion that, if Hospira “has no information at this time, it can say
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`so,” is the very definition of prejudice. (See Opp. at 10.) Hospira is entitled to investigate the
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`new theory and prepare its defense. It should not be forced to simply throw up its hands in
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`resignation. (See id. (“If it does not want to respond, Hospira’s relief is to object to those
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`requests as burdensome . . . .”).)
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`7
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`Case: 1:16-cv-00651 Document #: 87 Filed: 01/23/18 Page 8 of 9 PageID #:2543
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`II.
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`CONCLUSION
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`Hospira requests that the Court strike Fresenius Kabi’s IND theories. In the alternative,
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`the Court should extend the case schedule by four months to permit Hospira time to respond to
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`the new theories.
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`Dated: January 23, 2018
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`Respectfully Submitted,
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`HOSPIRA, INC.
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`By: /s/ Bradford P. Lyerla
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`Bradford P. Lyerla
`Sara T. Horton
`Yusuf Esat
`Ren-How Harn
`JENNER & BLOCK LLP
`353 N. Clark Street
`Chicago, IL 60654-3456
`Telephone: 312 222-9350
`blyerla@jenner.com
`shorton@jenner.com
`yesat@jenner.com
`rharn@jenner.com
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`Attorneys for Plaintiff Hospira, Inc.
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`8
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`Case: 1:16-cv-00651 Document #: 87 Filed: 01/23/18 Page 9 of 9 PageID #:2544
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`CERTIFICATE OF SERVICE
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`I, Yusuf Esat, an attorney at the law firm of Jenner & Block LLP, certify that on January
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`23, 2018, the foregoing Hospira’s Reply In Support of Its Motion to Strike Untimely Invalidity
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`Theories was served on counsel of record via the Court’s ECF system.
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`/s/ Yusuf Esat
` Yusuf Esat
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`9
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