DUSA PHARMACEUTICALS, INC. v. BIOFRONTERA INC.

CourtDistrict Court, D. New Jersey
DecidedSeptember 11, 2024
Docket3:23-cv-20601
StatusUnknown

This text of DUSA PHARMACEUTICALS, INC. v. BIOFRONTERA INC. (DUSA PHARMACEUTICALS, INC. v. BIOFRONTERA INC.) is published on Counsel Stack Legal Research, covering District Court, D. New Jersey primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
DUSA PHARMACEUTICALS, INC. v. BIOFRONTERA INC., (D.N.J. 2024).

Opinion

UNITED STATES DISTRICT COURT DISTRICT OF NEW JERSEY

DUSA PHARMACEUTICALS, INC., | Civ, No. 23-20601 (RE\IBD) SUN PHARMACEUTICAL INDUSTRIES, INC., and SUN MEMORANDUM ORDER PHARMACEUTICAL | (Public Version - Redacted) INDUSTRIES, LTD., Plaintiffs, BIOFRONTERA INC., BIOFRONTERA | BIOSCIENCE GMBH, BIOFRONTERA | PHARMA GMBH, BIOFRONTERA | . NEUROSCIENCE GMBH, and BIOFRONTERA AG, Defendants. Plaintiffs move for permission to effect alternative service on several related foreign defendants,! all located in Germany, by serving a law firm in the United States. [Dkt. 89.] The law firm, McGuireWoods LLP (“McGuireWoods”), has entered an appearance in this case and represents a single domestic defendant, Biofrontera Inc.? The firm does not represent the foreign defendants here but does represent three of them in another proceeding now pending before the

I Biofrontera Bioscience GmbH, Biofrontera Pharma GmbH, Biofrontera Development GmbH, Biofrontera Neuroscience GmbH, and Biofrontera AG. The Court will refer to these defendants collectively as the “foreign defendants.” 2 Biofrontera Inc. formerly was a wholly owned subsidiary of Biofrontera AG. In October 2021, however, Biofrontera Inc. issued its own stock shares via an initial public offering and thereafter ceased its formal corporate affihation with the Biofrontera group. While there remains an ongoing and interconnected commercial

United States Patent Trial and Appeal Board “PTAB”). Concerned with the prospect of delays involved in efforts to serve the foreign defendants under the Hague Convention on the Service Abroad of Judicial and Extra-Judicial Documents in. Civil and Commercial Matters “Hague Convention” or “Convention”), plaintiffs seek the Court’s permission to serve those defendants domestically through McGuireWoods. Biofrontera Inc. (through McGuireWoods) opposes the motion. For the reasons explained below, the Court sees no legal impediment to permitting plaintiffs to serve the foreign defendants through McGuireWoods. Nonetheless, efforts to serve those defendants under the Hague Convention are underway, and the German Central Authority has initiated a dialogue with plaintiffs in connection with those efforts. In that context, prudence counsels caution, Although the Court concludes that the manner of service that plaintiffs propose is permissible, the Court is not satisfied that service through the traditional means should be short-circuited at this time in favor of the somewhat more unusual step of permitting domestic service through a law firm that does not represent the foreign defendants in this case. Exercising its discretion, the Court will deny the motion without prejudice to plaintiffs’ right to renew it if service on the foreign defendants under the Convention has not been perfected by the end of the calendar year.

relationship and Biofrontera AG owns some amount of Biofrontera Inc.’s stock, Biofrentera Inc. is no longer a corporate affiliate of any of the foreign defendants.

I. BACKGROUND The parties to this case are, as relevant here, competing producers of photodynamic therapies designed for the treatment of certain skin diseases. This case arises from the asserted breach of a settlement agreement that resolved prior litigation between the parties in the United States District Court for the District of Massachusetts. More specifically, in March 2018, plaintiffs sued Biofrontera Inc. and the foreign defendants for patent infringement, unfair and deceptive trade practices, trade secret misappropriation, and tortious interference. McGuireWoods entered an appearance and represented all six defendants in that case. Notably, plaintiffs successfully served the foreign defendants under the Hague Convention. The litigation resulted in a settlement agreement executed in November 2021, which provided, among other things, he eee In June 2023, plaintiffs sued Biofrontera Inc. in the District of Massachusetts, claiming that it had breached the settlement agreement by, among other things, engaging in unlawful marketing and off-label promotion of its therapies, causing substantial financial losses to plaintiffs. [Dkt. 1.] McGuireWoods entered an appearance on behalf of Biofrontera Inc. and the parties thereafter stipulated to the transfer of the case to this Court. [Dkt. 16.] In November 2023, plaintiffs filed an amended complaint that added the foreign defendants and alleged three causes of action: G) breach of contract; (i) false advertising under the Lanham Act; and (iii) deceptive and unfair trade practices

under Massachusetts law. [Dkt. 50.]3 To date, McGuireWoods has not entered an

_ appearance on behalf of the foreign defendants in this case and has signaled that the firm will not represent the foreign defendants here. In December 2028, plaintiffs moved for the issuance of letters rogatory requesting the German Central Authority to effect service of the summonses and complaint on the foreign defendants under the Hague Convention. [Dkt. 62.] The Court granted the motion and issued the letters in February 2024 [Dkt. 67], and plaintiffs promptly commenced efforts to serve the foreign defendants under the Convention. Service has not yet been perfected, but between May and June 2024, the German Central Authority transmitted correspondence to plaintiffs making several inquiries, and plaintiffs responded to those requests. [Dkt. 98.] It is not known when the German Central Authority will take further action on the service yvequest under the Convention. Meanwhile, this Court held an initial scheduling conference on May 1, 2024 with counsel for plaintiffs and Biofrontera Inc. During that conference, plaintiffs indicated their intent to move for alternative service on the foreign defendants in light of anticipated delays in service through the Hague Convention. Based on the ensuing discussion with counsel, the Court temporarily deferred formal discovery until the motion had been fully briefed. [Dkt. 88.] Plaintiffs thereafter filed the present motion, defendant Biofrontera Inc. filed an opposition, and plaintiffs filed a

3 Biofrontera Inc. has moved to dismiss Counts IT and III of the amended complaint. That motion is fully briefed and pending.

reply. [Dkts. 89, 90, 91-95, 96.] During a telephone call with counsel on August 1, 2024, the Court ordered plaintiffs and Biofrontera Inc, to commence discovery, [Dkt. 107.] II. LEGAL STANDARDS As relevant here, Rule 4(f) provides: (f) Serving an Individual in a Foreign Country. Unless federal law provides otherwise, an individual ... may be served at a place not within any judicial district of the United States: (1) ‘by any internationally agreed means of service that is reasonably calculated to give notice, such as those authorized by the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents; (2) if there is no internationally agreed means, or if an international agreement allows but does not specify other means, by a method that is reasonably calculated to give notice: (A) as prescribed by the foreign country’s law for service in that country in an action in its courts of general jurisdiction; (B) as the foreign authority directs in response to a letter rogatory or letter of request; or (C) unless prohibited by the foreign country’s law, by: (1) delivering a copy of the summons and of the complaint to the individual personally; or Gi) using any form of mail that the clerk addresses and sends to the individual and that requires a signed receipt; or (3) by other means not prohibited by international agreement, as the court orders.

Fed. R. Civ. P. 4(f). These provisions, as relevant here, are applicable to service of foreign corporations. Fed. R. Civ. P. 4(h)(2).

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