Novo Nordisk of North America, Inc. v. Genentech, Inc.

874 F. Supp. 630, 36 U.S.P.Q. 2d (BNA) 1286, 1995 U.S. Dist. LEXIS 1261, 1995 WL 51649
CourtDistrict Court, S.D. New York
DecidedFebruary 2, 1995
Docket94 Civ. 8634 (CBM)
StatusPublished
Cited by5 cases

This text of 874 F. Supp. 630 (Novo Nordisk of North America, Inc. v. Genentech, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Novo Nordisk of North America, Inc. v. Genentech, Inc., 874 F. Supp. 630, 36 U.S.P.Q. 2d (BNA) 1286, 1995 U.S. Dist. LEXIS 1261, 1995 WL 51649 (S.D.N.Y. 1995).

Opinion

OPINION

MOTLEY, District Judge.

GENENTECH’S MOTION TO TRANSFER OR STAY

Both Novo Nordisk and Genenteeh are involved in the business of genetically-engineered pharmaceutical products. Novo Nor-disk is waiting to get FDA approval to be able to sell Norditropin, genetically-engineered human growth hormone, inside of the United States. Genenteeh owns some U.S. patents concerning the production of human growth hormone.

In March 1993, Genenteeh brought an action against Novo Nordisk before the U.S. International Trade Commission (ITC) alleging that Novo Nordisk’s product, Norditro-pin, infringed four of its patents. The ALJ determined that two of Genentech’s patents were invalid, one of the patents was not infringed, and one would be infringed. As this was the ALJ’s initial determination, this result will not be given a final determination until March 29, 1995. The very day the ALJ’s determination was available Novo Nordisk filed this action here. The very next day, Genenteeh filed an action against Novo Nordisk in Delaware District Court.

*632 In this case, filed in the Southern District, Novo Nordisk seeks deelaratoiy relief that its process for making Norditropin does not violate any of Genentech’s patents, that Gen-entech’s patents are invalid, and that Genen-tech has violated the antitrust laws.

Genentech has brought a motion, pursuant to 28 U.S.C. § 1404, to transfer this action to Delaware or to stay this action pending upon the resolution of the action in Delaware. Defendant claims that it is still within this court’s discretion to transfer the case to Delaware despite the First-Filed Rule. Genen-tech relies mainly on Kerotest Manufacturing Co. v. C-O-Two Fire Equipment Co., 342 U.S. 180, 72 S.Ct. 219, 96 L.Ed. 200 (1952), in which the Supreme Court ruled that the case should proceed in the forum of the later-filed action where both alleged infringers were before the court. Genentech claims that all the parties are before the court in the Delaware action and not in this action. In addition, Genentech argues that the interests of judicial economy would be served if this action was transferred to Delaware. Genen-tech gives four specific points to support this argument. They are as follows:

1. In the Delaware action both Novo Nor-disk and, another party, BTG are before the court. Genentech claims that both Delaware defendants infringe upon its patents. Therefore, in Delaware, the validity and enforceability of the patents could be litigated without inconsistent results. BTG is not in the action in this district. It is uncertain if BTG is amenable to service in New York, as it is a Delaware corporation with a principal place of business in New Jersey.
2. The dispute could be more quickly resolved in Delaware.
3. The convenience of the parties is not a major factor when the ease involves large corporations. While there are -witnesses for Novo Nordisk in Denmark, Delaware is no more inconvenient than New York.
4. Novo Nordisk has already filed a Rule 12(b)(6) motion in Delaware.

On the other side, Novo Nordisk insists that this court apply the First Filed Rule. Moreover, Novo Nordisk states that its principal place of business is New York and its house counsel are in New York. Moreover, all four of the patents will be at issue in New York while in Delaware only two of the four patents are at issue.

Summary of the law

It is well settled law in this Circuit that the first filed suit may not be transferred or stayed in favor of the second filed action unless there are special circumstances. Johnson Electric North America, Inc. v. Mabuchi Motor America Corp., 1986 WL 5385 (S.D.N.Y.1986) (Motley, J.); Steward Machine Co. v. Underpinning & Foundation Constructors, Inc., 1984 WL 359 (S.D.N.Y.1984) (Motley, J.) William Gluckin & Co. v. International Playtex Corp., 294 F.Supp. 876, 878 (S.D.N.Y.1968) (Motley, J.), aff'd 407 F.2d 177 (2d Cir.1969). Generally, there is a strong presumption in favor of the forum of the first filed suit. See New York v. Exxon Corp., 932 F.2d 1020, 1025 (2d Cir.1991). Additionally, it is the burden of the moving party to demonstrate any special circumstances. 800-Flowers, Inc. v. Intercontinental Florist, Inc., 860 F.Supp. 128, 131 (S.D.N.Y.1994) (Leisure, J.).

Special circumstances are present when the choice of the forum of the first filed case was the result of pure forum shopping, if the balance of convenience favors the second forum, or if the first filed action is against a customer of the alleged infringer and the second involves the infringer himself. Id.

Although the instant action was filed a mere one business day before the defendant’s action in Delaware District Court, it remains the first filed action. There is guidance on this issue in a similarly situated case. In Genentech v. Eli Lilly & Co., 998 F.2d 931, 938 (Fed.Cir.1993), the Federal Circuit found in favor of Genentech pursuant to the First Filed Rule although Genentech had filed only one day prior to Eli Lilly’s action in another federal court. In the Eli Lilly case, Genentech filed suit in the District Court in Indiana against the University of California and Eli Lilly seeking declaratory relief that a patent owned by the University and licensed to Eli Lilly was invalid and not infringed. The next day, the University filed suit *633 against Genentech for infringement of the same patent in California District Court. In addition, the court wrote, “[t]he general rule favors the forum of the first-filed action, whether or not it is a declaratory action.” Id. at 937.

Because Novo Nordisk’s action is the first filed action, Genentech can only have this action stayed or transferred if it demonstrates what this Circuit calls special circumstances.

I. Forum Shopping

Since the burden of proof is on Gen-entech, it must prove that the sole reason that Novo Nordisk filed its action in New York was motivated by forum shopping. However, Genentech cannot meet its burden because plaintiffs principal place of business is in the Southern District of New York. Genentech contends that the second suit should have priority because Novo Nordisk’s suit was commenced under a direct threat of imminent litigation, and, therefore, was an improper anticipatory filing. To support its argument, Genentech points to the fact that Novo Nordisk filed its complaint the same day as the ALJ ruled in the ease before the ITC. Moreover, Novo Nordisk filed an action seeking a declaratory judgment.

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874 F. Supp. 630, 36 U.S.P.Q. 2d (BNA) 1286, 1995 U.S. Dist. LEXIS 1261, 1995 WL 51649, Counsel Stack Legal Research, https://law.counselstack.com/opinion/novo-nordisk-of-north-america-inc-v-genentech-inc-nysd-1995.