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`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`LANNETT HOLDINGS, INC.
`Petitioner
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`v.
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`ASTRAZENECA AB
`Patent Owner
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`Case IPR2015-01629
`Patent No. 6,750,237
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`LANNETT HOLDINGS, INC.’S REPLY TO
`ASTRAZENECA AB’S PRELIMINARY RESPONSE
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`AstraZeneca AB’s (“Astra AB’s”) argument that the Petition is time-barred
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`lacks legal and factual support. A valid complaint must be properly served on a
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`petitioner in order to trigger the 35 U.S.C. § 315(b) time-bar. Here, Astra AB did
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`not properly serve a complaint on Lannett Holdings, Inc. (“Lannett”) but instead
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`carried-out ineffective service on a registered agent. Because Astra AB failed to
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`comply with the Delaware statute governing service on a registered agent, Lannett
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`was not served prior to July 28, 2014, with a complaint alleging infringement. As
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`the Petition was filed on July 28, 2015, the § 315(b) time bar is inapplicable. In
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`any event, there was no service of a valid complaint because, by Astra AB’s own
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`admission, the complaint it filed does not establish subject matter jurisdiction in
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`the Delaware District Court and could not be a time bar even if it had been served.
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`I.
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`Facts
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`On July 25, 2014, Astra AB and Impax Laboratories, Inc. (“Impax”) filed a
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`complaint against Lannett in the District of Delaware. The complaint alleged
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`infringement of the ‘237 patent (the “First Action”), and stated, in part: “[Astra
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`AB] is the owner by assignment of the ‘237 patent and has the right to sue for
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`infringement thereof.” See Ex. 2001 at ¶ 24. On July 29, a proof of service was
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`filed in the form of an affidavit from a process server. See Ex. 2002. The affidavit
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`fails to identify the individual who was served, notwithstanding that it specifically
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`calls for the “name of [the] individual” receiving service. See id.
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`Five days later, Astra AB and Impax, now joined by AstraZeneca UK
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`Limited (“Astra UK”), filed a second complaint against Lannett again alleging
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`infringement of the ‘237 patent (the “Second Action”). The only significant
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`difference between the complaints was in the purported ownership of the patent.
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`Specifically, the plaintiffs represented in the second complaint that “[Astra AB]
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`and [Astra UK] own all rights, title, and interest in the ‘237 patent and have the
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`right to sue for infringement thereof.” 1 See Ex. 2005 at ¶ 25. A proof of service
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`was filed in the form of a new affidavit from a process server, and identified the
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`specific individual who was served. See Ex. 1030
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`Lannett moved to dismiss, without answering, the First Action for lack of
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`subject matter jurisdiction, asserting that the named plaintiffs lacked standing
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`because co-owner Astra UK was missing from that action. The court consolidated
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`the actions and dismissed the motion “without prejudice to its renewal after
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`discovery is complete.”2 Ex. 2011, at 3. Pointedly, the court noted that it did not
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`need to address the standing issue at that point because “[t]he consolidated case has
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`all necessary plaintiffs.” Id.
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`1 The District Court characterized the First and Second Actions as “just the same
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`case, albeit with an extra plaintiff in the second case.” Ex. 2011 at 2.
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`2 The current discovery cutoff date in the consolidated action is March 18, 2016.
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`2
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`II. Argument
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`A.
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`The Complaint in the First Action was not Properly Served
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`The one-year period under § 315(b) did not begin to run until July 31, 2014,
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`the date that the service requirements of the applicable Delaware statutes were first
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`satisfied by service of the complaint in the Second Action. Because the Petition
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`was filed within one year from this date, on July 28, 2015, the Petition was timely.
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`Astra AB has provided no evidence that any person was served and has
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`therefore failed to establish that the complaint in the First Action was served as
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`required by Delaware law. While Delaware law allows service via registered
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`agent, Astra AB neglects to mention the requirements for service of a limited
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`liability company such as CSC Entity Services, LLC (“CSC”): “[s]ervice of legal
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`process upon any domestic limited liability company shall be made by delivering a
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`copy personally to any manager of the limited liability company in the State of
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`Delaware . . . .” Del. Code Title 6, § 18-105 (Ex. 1031) (emphasis added).
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`Astra AB was required to produce evidence that delivery was “personally to
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`any manager” of CSC. Astra AB has not produced any such evidence. The only
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`evidence on the record is a facially deficient affidavit that lists “CSC Entity
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`Services LLC” as the name of the individual served with the complaint for the First
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`Action. See Ex. 2002 (below) (yellow highlighting added).
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`3
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`The summons clearly requires a person to be named and identified so that
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`compliance with the statute can be demonstrated – this plainly was not done.
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`Accordingly, service has not been made. See Church-El v. Bank of New York,
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`2013 WL 1190013, *5 (D. Del. Mar. 21, 2013) (holding service not proper where
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`plaintiff failed to follow all steps necessary under relevant Delaware statute) (Ex.
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`1032); see also Hovde Acquisition, LLC v. Thomas, 2002 WL 1271681, *6 (Del.
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`Ch. June 5, 2002) (same) (Ex. 1031). Because there was no service of the first
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`complaint, the time bar of § 315(b) was not triggered.
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`Astra AB’s waiver argument is a red herring. Waiver, even if it had
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`occurred, does not remove § 315(b)’s statutory requirement of effective service.
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`See Macauto U.S.A. v. BOS GmbH & KG, IPR2012-00004 (PTAB Jan. 24, 2013)
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`(Paper 18 at 15) (“The statute requires that the service date of the complaint be
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`more than a year before the petition was filed.”). Any action by Lannett that may
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`have resulted in waiver of its own rights cannot somehow cure Astra AB’s
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`defective service. See Advanced Surgery Ctr. v. Connecticut Gen. Life, Ins. Co.,
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`2012 WL 3598815, *10 (D.N.J. July 31, 2012) (holding that waiver of challenge to
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`service that occurred when defendant’s motion to dismiss did not contest service
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`4
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`did not “make the plaintiff’s improper service proper”) (Ex. 1034). Moreover, “the
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`effective date of service is the date when the party commits the act of waiver.” Id.
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`Here, the earliest possible service date is September 24, 2014, when Lannett filed a
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`motion to dismiss the First Action. See Ex. 2008. Accordingly, regardless of
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`whether waiver occurred, the § 315(b) time bar is inapplicable.
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`B.
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`The Petition Cannot be Time Barred Because the District Court
`Never Had Subject Matter Jurisdiction Over the First Action
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`The District Court lacked subject matter jurisdiction over the First Action
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`because, by Astra AB’s own admission, a co-owner of the ‘237 patent was not
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`named in that action. Therefore, the complaint in that action, regardless of when
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`served, cannot constitute a basis for barring this Petition under § 315(b).
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` The time bar of § 315(b) does not apply if a complaint alleged to trigger the
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`bar was effectively never legally filed. See, e.g., Shaw Indus. Group, Inc. v.
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`Automated Creel Sys., Inc., IPR2013-00584 (PTAB Dec. 31, 2013) (Paper 16 at
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`13) (“a dismissal without prejudice leaves the parties as though the action had
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`never been brought”); Samsung Elecs. Am., Inc. v. LED Tech Dev., LLC, IPR2014-
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`00590 (PTAB Sept. 3, 2014) (Paper 23 at 6). Indeed, Astra AB has acknowledged
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`that the effects of service may be nullified if the action is jurisdictionally defective
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`for lack of standing. Astra AB Prelim. Resp., at 4.
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`Standing is a threshold jurisdictional issue. Lujan v. Defenders of Wildlife,
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`5
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`504 U.S. 555, 560–61 (1992). “[I]n a patent infringement action, the plaintiff must
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`demonstrate that it held enforceable title to the patent at the inception of the
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`lawsuit to assert standing.” Abraxis Bioscience, Inc., v. Navinta, 625 F.3d 1359,
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`1364 (Fed. Cir. 2010) (internal quotation omitted). Moreover, the Federal Circuit
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`“has long applied the rule that a patent co-owner seeking to maintain an
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`infringement suit must join all other co-owners.” STC.UNM v. Intel Corp., 754
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`F.3d 940, 944 (Fed. Cir. 2014); see also Ethicon, Inc. v. United States Surgical
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`Corp., 135 F.3d 1456 (Fed. Cir. 1998) (emphasis added).
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`Here, a co-owner of the ‘237 patent, Astra UK, was not a party to the First
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`Action. Specifically, the plaintiffs in the Second Action admitted that “[Astra AB]
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`and [Astra UK] own all rights, title, and interest” in the ‘237 patent. Ex. 2005 at
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`¶ 25 (emphasis added). Because Astra AB has admitted that at the time the
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`complaint was filed they did not constitute all of the co-owners of the ‘237 patent,
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`standing was never established, and “. . . the plaintiff[s] cannot pursue [that]
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`infringement suit.” Ethicon, 135 F.3d at 1456. Consequently, even if the
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`complaint in the First Action had been effectively served on Lannett–and it was
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`not–service of a fatally defective complaint cannot trigger the § 315(b) time bar.
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`Astra AB contends that it had standing in the First Action “because it holds
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`legal title to the ‘237 patent.” It is legally irrelevant if Astra AB today holds legal
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`title to the ‘237 patent. In any event, Astra AB is wrong as a matter of law. A co-
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`6
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`owner ordinarily does not have standing in an infringement action in which another
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`co-owner is not a party, and Astra AB has not identified why any of the limited
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`exceptions to the general rule would apply here. See STC.UNM, 754 F.3d at 945-
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`47 (finding that patent co-owner bringing infringement action lacked standing due
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`to absence of another co-owner from suit, and upholding dismissal on this basis).
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`Astra AB has not identified any authority holding that a jurisdictionally-
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`deficient action can trigger the § 315(b) time bar.3 Astra AB asserts that because
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`the First Action was consolidated rather than dismissed, the absence of co-owner
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`Astra UK does not nullify the effects of service of the first complaint. Astra AB is
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`wrong. The court expressly noted that the dismissal of Lannett’s motion to
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`dismiss was “without prejudice to its renewal after discovery is complete.” In fact,
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`the District Court acknowledged the jurisdictional deficiency of the First Action
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`when it noted that “[t]he consolidated case has all necessary plaintiffs.”
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`Dated: December 18, 2015
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`Respectfully submitted,
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`/Joseph F. Posillico/
`Joseph F. Posillico, Reg. No. 32,290
`Fox Rothschild LLP
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`Attorneys for Petitioner
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`3 Apple Inc. v. Rensselaer Polytechnic Inst., IPR2014-00319, cited by Astra AB, is
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`inapposite because subject matter jurisdiction was not at issue. Instead, the parties
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`stipulated to consolidation of two actions for convenience.
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`7
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`CERTIFICATE OF SERVICE
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`Pursuant to 37 C.F.R. §§ 42.6(e) and 42.105(b), the undersigned certifies
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`that on the 18th day of December 2015 a complete and entire copy of this the
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`above-captioned “Petitioner’s Reply to AstraZeneca AB’s Preliminary Response,”
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`including its supporting evidence (Exhibits LAN 1030 – 1034) was provided via
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`email to the Patent Owner by serving the following email addresses:
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`michael.flibbert@finnegan.com
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`maureen.queler@finnegan.com
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`Electronic service was used with the consent of the Patent Owner’s counsel.
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`Dated: December 18, 2015
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`Respectfully submitted,
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`Joseph F. Posillico, Reg. No. 32,290
`Fox Rothschild LLP
`2000 Market Street, 20th Floor
`Philadelphia, PA 19103
`Tele: 215-299-2000
`Fax: 215-299-2150
`Attorneys for Petitioner