`Filed: April 14, 2015
`
`
`
`
`
`
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`_____________________________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`_____________________________
`
`
`RANBAXY LABORATORIES LTD. and RANBAXY INC.,
`Petitioners,
`
`v.
`
`ADAMAS PHARMACEUTICALS, INC.,
`Patent Owner.
`
`_____________________________
`
`Case IPR2015-00410
`Patent No. 8,362,085
`
`_____________________________
`
`
`
`PATENT OWNER’S PRELIMINARY RESPONSE
`PURSUANT TO 37 C.F.R. § 42.107
`
`
`
`
`
`
`
`
`
`TABLE OF CONTENTS
`
`I.
`
`II.
`
`Introduction ........................................................................................................... 1
`
`The Petition Failed to Name All Real Parties-In-Interest .................................... 1
`
`A.
`B.
`C.
`
`D.
`E.
`
`Factual Background .................................................................................... 3
`The Real Party-in-Interest Requirement .................................................... 5
`Sun Pharma was a Real Party-in-Interest at the Time the
`Petition was Filed ....................................................................................... 7
`The Failure to Identify Sun Pharma is Fatal ............................................ 10
`Additional Discovery ............................................................................... 11
`
`III. Conclusion .......................................................................................................... 11
`
`IV. Appendix – List of Exhibits ................................................................................ 13
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`-1-
`
`
`
`I.
`
`INTRODUCTION
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`
`The Board should not institute inter partes review of U.S. Patent No.
`
`8,362,085 (the “’085 patent”) because petitioners – Ranbaxy Laboratories Ltd.
`
`(“Ranbaxy Labs”) and Ranbaxy Inc. (collectively, “Petitioners”) – filed a fatally
`
`flawed Petition. Specifically, Petitioners failed to name all real parties-in-interest,
`
`and their belated correction of this defect is futile under 35 U.S.C. § 315(b).
`
`Accordingly, institution of inter partes review should be denied.
`
`II. THE PETITION FAILED TO NAME
`ALL REAL PARTIES-IN-INTEREST
`
`Petitioners did not identify all real parties-in-interest in their Petition as
`
`required by 35 U.S.C. § 312(a)(2) and 37 C.F.R. § 42.8(b)(1). Specifically, the
`
`Petition did not identify Sun Pharmaceutical Industries Ltd. (“Sun Pharma”) as a
`
`real party-in-interest, despite the fact that Ranbaxy Labs was acting as a proxy for
`
`Sun Pharma and subject to its direct control at the time the Petition was filed.
`
`Notably, at the time Petition was filed, both Sun Pharma and Ranbaxy were in
`
`infringement litigation regarding the ‘085 patent.
`
`Sun Pharma recently completed its acquisition of petitioner Ranbaxy Labs,
`
`which is now defunct. Ex. 2001 p. 1 (“Ranbaxy will be delisted”). On April 8,
`
`2015, Petitioners served updated Mandatory Notices, identifying for the first time
`
`Sun Pharma as a real party-in-interest. Paper 15 p. 2.
`
`
`
`-1-
`
`
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`Unmentioned in Petitioners’ updated Mandatory Notices, however, is the
`
`fact that at the time the Petition was filed on December 17, 2014, the legal
`
`relationship between Ranbaxy Labs and Sun Pharma was governed by an
`
`agreement between them titled Scheme of Arrangement (the “Scheme”). See Ex.
`
`2002. The Scheme created an explicit agency relationship between the entities,
`
`designating Ranbaxy Labs as the agent of Sun Pharma from April 1, 2014 to
`
`March 25, 2015 (the “standstill” period).
`
`The Petition was filed on December 17, 2014, which was during the
`
`standstill period of the Scheme, when Ranbaxy Labs was expressly designated by
`
`the Scheme as acting “for and on behalf of and as an agent for [Sun Pharma].” Id.
`
`p. 15. Accordingly, as provided by the Scheme, Ranbaxy Labs filed the petition
`
`for inter partes review on behalf of Sun Pharma. Petitioners, however, failed to
`
`identify Sun Pharma as a real party-in-interest.
`
`Petitioners’ failure to identify Sun Pharma as a real party-in-interest in its
`
`Petition is fatal. Petitioners’ belated identification of Sun Pharma as a real party-
`
`in-interest cannot change that outcome. Specifically, Petitioners’ belated
`
`identification of Sun Pharma as a real party-in-interest is futile given the pre-
`
`existing litigation regarding the ‘085 patent. The earliest filing date that can be
`
`accorded to the Petition is the date of the correction of the real parties-in-interest,
`
`April 8, 2015. See Paper 15. That is more than one year after Sun Pharma – which
`
`
`
`-2-
`
`
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`is now seeking to act as a petitioner and is undisputedly a real party-in-interest –
`
`was constructively served and waived formal service of a complaint alleging
`
`infringement of the ’085 patent. See Ex. 2003; see also 35 U.S.C. § 315(b)
`
`(including service against a real party-in-interest or privy); Fed. R. Civ. P. 4(d)(4)
`
`(“When the plaintiff files a waiver, proof of service is not required and these rules
`
`apply as if a summons and complaint had been served at the time of filing the
`
`waiver.”); Motorola Mobility LLC v. Arnouse, Case IPR2013-00010, slip op. at 6
`
`(PTAB Jan. 30, 2013) (Paper 20) (holding that “in the situation where the
`
`petitioner waives service of a summons, the one-year time period begins on the
`
`date on which such a waiver is filed”).
`
`A. FACTUAL BACKGROUND
`
`Both Ranbaxy Labs and Sun Pharma are defendants in patent infringement
`
`litigation in which, inter alia, the ‘085 patent has been asserted by patent owner
`
`Adamas Pharmaceuticals, Inc. and its exclusive licensee, Forest Laboratories. In
`
`that litigation, Sun Pharma was provided with a copy of the Complaint and
`
`requested to waive service on February 10, 2014. Ex. 2004. Sun Pharma promptly
`
`agreed to waive service, and that waiver was filed with the U.S. District Court for
`
`the District of Delaware on February 17, 2014. Ex. 2003.
`
`On April 6, 2014, Ranbaxy Labs and Sun Pharma publicly announced that
`
`they had entered into final agreements under which Sun Pharma would acquire
`
`
`
`-3-
`
`
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`Ranbaxy Labs. Ex. 2005. Sun later announced that the merger closed on March
`
`25, 2015. Ex. 2001; Paper 15 p. 1. During the interim, the legal relationship
`
`between Ranbaxy Labs and Sun Pharma was governed by the Scheme agreed to by
`
`Ranbaxy Labs and Sun Pharma. See Ex. 2002.
`
`During the relevant period, the Scheme created an explicit agency
`
`relationship, with Ranbaxy Labs serving as the agent of its controlling principal,
`
`Sun Pharma. In particular, the Scheme provided that “[f]or the period from the
`
`Appointed Date and up to the Effective Date” (that is, from April 1, 2014 to March
`
`25, 2015, the standstill period):
`
`Any of the rights, powers, authorities and privileges attached or
`
`related or pertaining to and exercised by or available to
`
`[Ranbaxy Labs] shall be deemed to have been exercised by
`
`[Ranbaxy Labs] for and on behalf of and as agent for [Sun
`
`Pharma].
`
` Similarly, any of the obligations, duties and
`
`commitments attached, related or pertaining to the Undertaking
`
`that have been undertaken or discharged by [Ranbaxy Labs]
`
`shall be deemed to have been undertaken or discharged for and
`
`on behalf of and as agent for [Sun Pharma]. Id. p. 15 (emphasis
`
`added).
`
`The Scheme further provided that:
`
`The conduct of business of [Ranbaxy Labs] and [Sun Pharma]
`
`in the period between the date of this Scheme and the Effective
`
`
`
`-4-
`
`
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`Date shall be as agreed in writing between [Ranbaxy Labs] and
`
`[Sun Pharma] . . . . Id.
`
`Finally, the Scheme provided that any legal proceedings, such as those
`
`sought by Ranbaxy Labs in the Petition, should be treated as if they had been
`
`brought by Sun Pharma: “Upon coming into effect of this Scheme all suits, claims,
`
`actions and proceedings by or against [Ranbaxy Labs] pending and/or arising on or
`
`before the Effective Date shall be continued and be enforced by or against [Sun
`
`Pharma] as effectually as if the same had been originally instituted and/or pending
`
`and/or arising by or against [Sun Pharma].” Id. p. 14 (emphasis added). Indeed,
`
`now that the merger has closed, Sun Pharma seeks to step into the now-defunct
`
`Ranbaxy Labs’ shoes for purposes of the Petition. Paper 15 p. 2; see also Ex. 2002
`
`pp. 14-15 (“[Sun Pharma] will undertake to have all legal or other proceedings
`
`initiated by or against [Ranbaxy Labs] referred to in Section 5(a) above transferred
`
`to its name and to have the same continued, prosecuted and enforced by or against
`
`[Sun Pharma].”).
`
`B. THE REAL PARTY-IN-INTEREST REQUIREMENT
`
`“A petition [for inter partes review] may be considered only if . . . [it]
`
`identifies all real parties in interest.” 35 U.S.C. § 312(a)(2). Identification of real
`
`parties-in-interest assists “members of the Board in identifying potential conflicts”
`
`and assures “proper application of the statutory estoppel provisions.” Office Patent
`
`
`
`-5-
`
`
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`Trial Practice Guide, 77 Fed. Reg. 48,756, 48,759 (Aug. 14, 2012). The
`
`requirement “seeks to protect patent owners from harassment via successive
`
`petitions by the same or related parties, to prevent parties from having a ‘second
`
`bite at the apple,’ and to protect the integrity of both the USPTO and Federal
`
`Courts by assuring that all issues are promptly raised and vetted.” Id.
`
`Real party-in-interest analysis is “highly fact-dependent” and judged by the
`
`totality of the circumstances rather than any bright-line test. Id. “[A]t a general
`
`level, the ‘real party-in-interest’ is the party that desires review of the patent.
`
`Thus, the ‘real party-in-interest’ may be the petitioner itself, and/or it may be the
`
`party or parties at whose behest the petition has been filed.” Id.
`
`In determining whether a non-party was a real party-in-interest, “[a]
`
`common consideration is whether the non-party exercised or could have exercised
`
`control over a party’s participation in a proceeding.” Id. (emphasis added).
`
`Complete control is not required, “[i]t should be enough that the nonparty has the
`
`actual measure of control or opportunity to control that might reasonably be
`
`expected between two formal coparties.” Id. (quoting 18A Charles Alan Wright,
`
`Arthur R. Miller & Edward H. Cooper, Federal Practice & Procedure § 4451 (2d
`
`ed. 2011)) (internal quotations omitted). “The non-party’s participation may be
`
`overt or covert, and the evidence may be direct or circumstantial—but the evidence
`
`as a whole must show that the non-party possessed effective control from a
`
`
`
`-6-
`
`
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`practical standpoint.” Zoll Lifecor Corp. v. Philips Elec. N. Am. Corp., Case
`
`IPR2013-00606, slip op. at 9 (PTAB Mar. 20, 2014) (Paper 13) (citing Gonzalez v.
`
`Banco Cent. Corp., 27 F.3d 751, 759 (1st Cir. 1994)). In short, possession of
`
`effective control, whether exercised or not, is sufficient to establish an entity as a
`
`real party in interest.
`
`C. SUN PHARMA WAS A REAL PARTY-IN-INTEREST
`AT THE TIME THE PETITION WAS FILED
`
`At the time the Petition was filed on December 17, 2014, Sun Pharma was a
`
`real party-in-interest under the terms of the Scheme. Accordingly, Sun Pharma
`
`should have been, but was not, identified as a real party-in-interest in the Petition.
`
`The Board has previously found that a non-party should have been identified
`
`as a real party-in-interest in a variety of circumstances. See, e.g., Zoll, Paper 13,
`
`slip op. at 10 (finding that “an involved and controlling parent corporation
`
`representing the unified interests of itself and [p]etitioner” was a real party-in-
`
`interest); Galderma S.A. v. Allergan Industrie, SAS, Case IPR2014-01422, slip op.
`
`at 12-13 (PTAB Mar. 5, 2015) (Paper 14) (same); Zerto, Inc. v. EMC Corp., Case
`
`IPR2014-01254, slip op. at 14-15 (PTAB Feb 12, 2015) (Paper 35) (same); GEA
`
`Process Eng'g. Inc. v. Steuben Foods, Inc., Case IPR2014-00041, slip. op. at 14-21
`
`(PTAB Feb. 11, 2015) (Paper 140) (finding a non-party that paid the petitioner’s
`
`legal fees to be a real party-in-interest); RPX Corp. v. VirnetX Inc., Case IPR2014-
`
`
`
`-7-
`
`
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`00171, slip op. at 6-10 (PTAB June 5, 2014) (Paper 49) (finding a non-party was a
`
`real party-in-interest when litigating through a proxy).
`
`Here, the interest of Sun Pharma was not covert. Nor does one have to look
`
`to a course of conduct to discern that Sun Pharma had the ability to control
`
`Ranbaxy Labs’ filing of the Petition. Instead, the Scheme agreed to by Ranbaxy
`
`Labs and Sun Pharma is explicit, and makes readily apparent that Sun Pharma was
`
`a real party-in-interest.
`
`Given the Scheme, there can be no doubt “at whose behest” the Petition was
`
`filed. See 77 Fed. Reg. at 48,759. The Scheme explicitly provides that any rights
`
`exercised by Ranbaxy Labs, such as those exercised by Ranbaxy Labs in filing the
`
`Petition, were exercised by Ranbaxy Labs “for and on behalf of” Sun Pharma. Ex.
`
`2002 p. 15 (emphasis added). In other words, Ranbaxy Labs was acting as a proxy
`
`for Sun Pharma. See, e.g., RPX Corp., Paper 49, slip op. at 6-10. This alone is
`
`enough to find that Sun Pharma was a real party-in-interest.
`
`Moreover, Sun Pharma also had “the power—whether exercised or not—to
`
`call the shots.” See, e.g., Galderma, Paper 14, slip op. at 8 (quoting Gonzalez, 27
`
`F.3d at 758). The Scheme provides that the conduct of Ranbaxy Labs’ business
`
`would be as agreed in writing between Ranbaxy Labs and Sun Pharma. Ex. 2002
`
`p. 15. And pursuant to the Scheme, Ranbaxy Labs was acting as Sun Pharma’s
`
`agent in filing the Petition. Id. It is a fundamental aspect of any agency
`
`
`
`-8-
`
`
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`relationship that a principal has the right to control the conduct of its agent.
`
`Restatement (Second) of Agency § 14.
`
`The relationship between Ranbaxy Labs and Sun Pharma was even closer
`
`than the relationship between an intertwined parent and subsidiary. See, e.g.,
`
`Galderma, Paper 14, slip op. at 12 (quoting Zoll, Paper 13, slip op. at 10). Indeed,
`
`the explicit purpose of the Scheme was to “combine the business, activities and
`
`operations of [Ranbaxy Labs] and [Sun Pharma] into a single company with effect
`
`from [April 1, 2014].” Ex. 2002 p. 4 (emphasis added).1 Consistent with this
`
`purpose, the Scheme states that legal proceedings brought by Ranbaxy Labs during
`
`
`1 In contrast, the petitions in Synopsis Inc. v. Mentor Graphics Corp., Case
`
`IPR2012-00042, slip op. at 14-16 (PTAB Feb. 19, 2014) (Paper 60), and Valeo
`
`North America, Inc. v. Magna Elecs., Inc., Case IPR2014-00220, slip op. at 3
`
`(PTAB Jan. 8, 2015) (Paper 45), were filed prior to the relevant acquisitions. Here,
`
`the Petition was filed after the Scheme was entered into and took effect. See, e.g.,
`
`Ex. 2002 p. 4. This case is also distinguishable from Valeo North America, Inc. v.
`
`Magna Elecs., Inc., Case IPR2014-01203, slip op. at 7-8 (PTAB Jan. 28, 2015)
`
`(Paper 13), where a predecessor-in-interest was inadvertently named after it had
`
`ceased to exist, rather than its successor. Here, both Ranbaxy Labs and Sun
`
`Pharma were extant at the time the Petition was filed.
`
`
`
`-9-
`
`
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`the standstill period would be continued by Sun Pharma “as effectually as if the
`
`same had been originally instituted” by Sun Pharma. Id. p. 14 (emphasis added).
`
`Where, as here, a petition is filed on behalf of an entity and that entity has
`
`the ability, whether exercised or not, to control the course of the proceeding, that
`
`entity is a real party-in-interest and must be identified. Sun Pharma should have
`
`been identified as a real party-in-interest in the Petition.
`
`D. THE FAILURE TO IDENTIFY SUN PHARMA IS FATAL
`
`The failure to identify all real parties-in-interest violates both statutory and
`
`regulatory requirements. 35 U.S.C. § 312(a); 47 C.F.R. § 42.8(b)(1). Section
`
`42.106(b) of 37 C.F.R. provides that “[w]here a party files an incomplete petition,
`
`no filing date will be accorded[.]”
`
`Here, Petitioners’ attempt to cure the omission of Sun Pharma as a real
`
`party-in-interest on April 8, 2015 was futile, because Sun Pharma was
`
`constructively served (via filing of a waiver of service) with a Complaint alleging
`
`infringement of the ’085 patent over one year earlier, on February 17, 2014. Ex.
`
`2004; Ex. 2003; see also Motorola, Paper 20, slip op. at 6 (holding that “in the
`
`situation where the petitioner waives service of a summons, the one-year time
`
`period begins on the date on which such a waiver is filed”). Thus, after correction,
`
`the earliest filing date that arguably could be accorded to the Petition, the date of
`
`the correction, April 8, 2015, does not fall within the one-year period specified by
`
`
`
`-10-
`
`
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`35 U.S.C. § 315(b). The Petition should be denied as untimely. See, e.g.,
`
`VMware, Inc. v. Good Tech. Software, Inc., Case IPR2014-01324, slip op. at 2-3
`
`(PTAB Feb. 20, 2015) (Paper 28) (institution barred by acquirer’s service date).
`
`E. ADDITIONAL DISCOVERY
`
`Patent Owner believes the evidence submitted herewith sufficiently
`
`establishes that Sun Pharma was an unnamed real party-in-interest when the
`
`Petition was filed. In the absence of a specific rebuttal, no further showing is
`
`required for denial of the relief requested in the Petition. Should Petitioners
`
`contest that Sun Pharma was an unnamed real party-in-interest when the Petition
`
`was filed, or should the Board desire further information on the issue, Patent
`
`Owner may seek discovery reasonably tailored to address the issue at the
`
`appropriate time.
`
`III. CONCLUSION
`
`Petitioners failed to identify all real parties-in-interest in the Petition as
`
`required. Sun Pharma was a real party-in-interest, because at the time the Petition
`
`was filed Ranbaxy Labs was acting as a proxy for Sun Pharma. Petitioners’
`
`attempt to cure the Petition is futile, because the earliest filing date the Petition can
`
`be accorded does not fall within the period specified by 35 U.S.C. § 315(b).
`
`Accordingly, institution of inter partes review should be denied.
`
`
`
`
`
`
`
`-11-
`
`
`
`Date: April 14, 2015
`
`
`
`
`
`
`
`
`
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`Respectfully submitted,
`
`By: /Peter J. Armenio, P.C. (Reg. No. 41,588)/
` Peter J. Armenio, P.C. (Reg. No. 41,588)
`Evangeline Shih (Reg. No. 50,170)
`QUINN EMANUEL URQUHART &
`SULLIVAN, LLP
`51 Madison Avenue, 22nd Floor
`New York, NY 10010
`General Tel: (212) 849-7000
`Direct Tel: (212) 849-7553
`Fax: (212) 849-7100
`peterarmenio@quinnemanuel.com
`evangelineshih@quinnemanuel.com
`
`Attorneys for Adamas Pharmaceuticals,
`Inc., Forest Laboratories LLC and
`Forest Laboratories Holdings, Ltd.
`
`
`-12-
`
`
`
`Case IPR2015-00410
`Patent 8,362,085
`Patent Owner Preliminary Response
`
`
`IV. APPENDIX – LIST OF EXHIBITS
`
`
`
`EXHIBIT NO.
`
`DESCRIPTION
`
`2001
`
`2002
`
`2003
`
`2004
`
`2005
`
`
`
`March 25, 2015 Press Release
`
`Scheme of Arrangement
`
`As-filed Waiver of Service
`
`Request for Waiver of Service with Complaint
`
`April 6, 2014 Press Release
`
`
`
`-13-
`
`
`
`
`
`CERTIFICATE OF SERVICE
`
`I certify that the foregoing Patent Owner’s Preliminary Response Pursuant to
`
`37 C.F.R. § 42.207 and accompanying Exhibits 2001-2005 were served on this
`
`14th day of April, 2015, on the Petitioner at the correspondence address of the
`
`Petitioner as follows:
`
`John W, Bateman
`Kenyon & Kenyon LLP
`1500 K Street, NW
`Washington, DC 20005
`jbateman@kenyon.com
`
`Karen C. Shen
`Kenyon & Kenyon LLP
`One Broadway
`New York, NY 10004-1007
`kshen@kenyon.com
`
`
`Date: April 14, 2015
`
`
`Respectfully submitted,
`By: /Peter J. Armenio, P.C. (Reg. No. 41,588)/
` Peter J. Armenio, P.C. (Reg. No. 41,588)
`Evangeline Shih (Reg. No. 50,170)
`QUINN EMANUEL URQUHART &
`SULLIVAN, LLP
`51 Madison Avenue, 22nd Floor
`New York, NY 10010
`General Tel: (212) 849-7000
`Direct Tel: (212) 849-7553
`Fax: (212) 849-7100
`peterarmenio@quinnemanuel.com
`evangelineshih@quinnemanuel.com
`Attorneys for Adamas Pharmaceuticals,
`Inc., Forest Laboratories LLC and
`Forest Laboratories Holdings, Ltd.
`
`
`
`
`
`-1-
`
`