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`Case 1:22-cv-00252-MSG Document 64 Filed 03/10/23 Page 1 of 4 PageID #: 1320
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
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`CIVIL ACTION
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`NO. 22-252
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`ARBUTUS BIOPHARMA CORPORATION
`and GENEVANT SCIENCES GMBH,
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`Plaintiffs,
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`v.
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`MODERNA, INC. and MODERNATX, INC.,
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`MEMORANDUM OPINION
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`Goldberg, J.
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` March 10, 2023
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`Context is important. This is particularly so in litigation and in considering the stage of a
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`proceeding. In the patent infringement matter before me, which is at the pleading stage, the parties,
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`now joined by the United States and several Amici Curiae, hotly contest the application of 28 U.S.C.
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`§ 1498(a). This statute instructs that whenever it is alleged that a patent has been used by the United
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`States in an infringing manner, litigation shall occur in the United States Court of Federal Claims,
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`which is where Defendants Moderna, Inc. and Modernatx, Inc. (collectively, “Moderna”) urge that
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`a majority of this case must be decided.
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`It is well settled that an accused infringer, such as Moderna, bears the burden of establishing
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`under § 1498(a) that the infringing use is “for the Government” and “with authorization and consent
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`of the Government.” Sevenson Envt’l Servs., Inc. v. Shaw Envt’l, Inc., 477 F.3d 1361, 1365 (Fed.
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`Cir. 2007). These standards clearly implicate factual considerations, and in the context of the
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`pleading stage of this case, where I am obligated to assume the veracity of the facts pled in the
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`Complaint, weighing facts is inappropriate. Burtch v. Milberg Factors, Inc., 662 F.3d 212, 221 (3d
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`Cir. 2011). Consequently, the Government’s recently filed Statement of Interest does not change
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`Case 1:22-cv-00252-MSG Document 64 Filed 03/10/23 Page 2 of 4 PageID #: 1321
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`my view that Moderna’s request to transfer a portion of this matter to the Federal Claims Court is
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`premature and must be denied at this time. My brief reasoning follows.
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`Most of the necessary background regarding § 1498(a) is set forth in my November 2, 2022
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`Opinion that addressed Moderna’s partial motion to dismiss. That motion asserted that some of
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`Plaintiff’s patent infringement claims should proceed in the Court of Federal Claims pursuant to 28
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`U.S.C. § 1498(a). I denied that request on November 2, 2022, finding that Moderna’s Rule 12(b)(6)
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`motion was not an appropriate vehicle to resolve the § 1498(a) issue. Arbutus Biopharma Corp. v.
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`Moderna, Inc., No. 22-cv-252, 2022 WL 16635341, at *7–8 (D. Del. Nov. 2, 2022). Following
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`submission of the parties’ Answers and Counterclaims, I set a Rule 16 scheduling conference to be
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`held on February 16, 2023.
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`Two days prior to that conference, the United States Government filed a Statement of
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`Interest, asserting that any doses of the vaccine produced by Moderna pursuant to the terms of
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`Contract No. W911QY-20-0100 (the ’-0100 Contract) were “for the Government” and “with the
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`authorization and consent of the Government.” During the Rule 16 conference, counsel for the
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`parties and the Government (who I invited to participate) addressed the import of this Statement of
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`Interest. Letter briefs, including those of Amici, have subsequently been submitted and considered.
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`As set out in my November 2, 2022 Opinion, § 1498(a) establishes an affirmative defense,
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`not a jurisdictional bar. Manville Sales Corp. v. Paramount Sys., Inc., 917 F.2d 544, 554 (Fed. Cir.
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`1990). Importantly, I also noted that a § 1498(a) affirmative defense presents a highly factual
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`determination. Toxgon Corp. v. BNFL, Inc., 312 F.3d 1379, 1382–83 (Fed. Cir. 2002). Viewing
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`as true the well-pled facts in the Complaint, I found that Moderna had not established as a matter of
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`law that § 1498(a) applied, and that the issue was best resolved after discovery.
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`Moderna continues to press its point that § 1498(a) requires transfer of part of this case to
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`the Court of Federal Claims. Now, heavily relying on the recently filed Statement of Interest,
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`2
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`Case 1:22-cv-00252-MSG Document 64 Filed 03/10/23 Page 3 of 4 PageID #: 1322
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`Moderna urges that, “the Government is in the best position to decide what is for its benefit.”
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`(Moderna Letter brief, p. 2.) But neither the Government nor Moderna have provided any authority
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`suggesting that the Government’s interpretation of § 1498(a) trumps a court’s analysis of this issue.
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`And I note that the very contract that Moderna relies upon also states that vaccine was to be
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`developed to “improve patient care,” thereby “mitigating the impact of COVID-19 on the nation
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`and its people.” (D.I. 17-1, Ex. A (emphasis added)); see Larson v. United States, 26 Cl. Ct. 365
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`(Cl. Ct. 1992) (“[M]edical care is provided for the benefit of the patient, not the government.”).
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`While the Statement of Interest does point to certain evidence that Moderna’s sales under
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`the ’-0100 Contract may have been with the “authorization and consent” of the Government,
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`Moderna offers no evidence that sales were “for the Government” which is also a necessary factor
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`under §1498(a). But in any event, examination of evidence in the context of Fed. R. Civ. P. 12(b)(6)
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`is not proper. Rather, I will consider the § 1498(a) issue after both parties have engaged in
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`discovery, which will provide Plaintiff an opportunity to review the entire unredacted version of the
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`’-0100 Contract and discover facts regarding that Contract.
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`The recent submissions by the parties underscore why discovery on this issue is needed.
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`Moderna originally moved to dismiss Plaintiffs’ claims as to all of its sales of COVID-19 vaccine
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`doses to the U.S. Government. But now, both the Government and Moderna acknowledge that
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`claims regarding sales under a second Government contract (W58P05-22-C-0017 (the ’-0017
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`Contract)) were not with the authorization and consent of the Government and should not be
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`dismissed. Had I granted the relief Moderna sought in its original motion to dismiss, this fact would
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`not have come to light and the relief ordered could have been incorrect. Discovery is necessary to
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`ensure that any application of § 1498(a) is based upon developed facts and not solely on the
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`Government’s say-so.
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`3
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`Case 1:22-cv-00252-MSG Document 64 Filed 03/10/23 Page 4 of 4 PageID #: 1323
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`I reaffirm the analysis and conclusions set forth in my November 2, 2022 Memorandum
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`Opinion and again conclude that the Complaint should not be partially dismissed based on 28 U.S.C.
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`§ 1498(a). An appropriate Order follows.
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`4
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