United States, et al v. Cytogel Pharma, LLC, No. 2:2016cv13987 - Document 397 (E.D. La. 2018)
Court Description: ORDER AND REASONS: IT IS ORDERED that the 235 Motion to Dismiss Defendant Cytogel Pharma, LLC's Second Amended and Restated Counterclaims or, in the Alternative, to Dismiss Count 14 of Cytogel's Second Amended and Restated Counterclaims, be and hereby is DENIED as to Counts 113, and DENIED WITHOUT PREJUDICE as to Count 14. IT IS FURTHER ORDERED that the 301 Motion to Dismiss Counts 1, 8, 9, and 14 of Cytogel's Second Amended and Restated Counterclaims, be and hereby is DENIE D WITHOUT PREJUDICE as to Count 14. IT IS FURTHER ORDERED that Tulane, Dr. Zadina, and the United States file responsive pleadings to Cytogel's 220 Second Amended and Restated Counterclaims by no later than 11/12/2018, at 5:00 p.m. Signed by Judge Susie Morgan on 10/29/2018. (jls)
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United States, et al v. Cytogel Pharma, LLC Doc. 397 U N ITED S TATES D ISTRICT COU RT EASTERN D ISTRICT OF LOU ISIAN A TH E U N ITED S TATES an d TH E AD MIN ISTRATORS OF TH E TU LAN E ED U CATION AL FU N D , Plain tiffs CIVIL D OCKET VERSU S N O. 16 -13 9 8 7 CYTOGEL PH ARMA, LLC, D e fe n d an t SECTION : “E” ( 1) ORD ER AN D REAS ON S Before the Court are a Motion to Dism iss Defendant Cytogel Pharm a, LLC’s (“Cytogel”) Second Am ended and Restated Counterclaim s pursuant to Rule 12(b)(7) of the Federal Rules of Civil Procedure or, in the Alternative, to Dism iss Count 14 of Cytogel’s Second Am ended and Restated Counterclaim s pursuant to Rule 12(b)(6), filed by Plaintiff the Adm inistrators of the Tulane Educational Fund (“Tulane”) and Counterclaim Defendant Dr. J am es E. Zadina, 1 and a Motion to Dism iss Counts 1, 8, 9, and 14 of Cytogel’s Second Am ended and Restated Counterclaim s, filed by Plaintiff the United States of Am erica. 2 Cytogel opposes these m otions. 3 For the reasons that follow, the m otions are D EN IED as to Counts 1– 13, and D EN IED W ITH OU T PREJU D ICE to the extent they address Count 14. Tulane, Dr. Zadina, and the United States m ay refile the m otions as they pertain to Count 14 at the tim e of the second trial in this case. BACKGROU N D In the 1990 s, Dr. Zadina and his colleagues at Tulane University developed synthetic peptides that stim ulate the m u opioid receptor and are related to endom orphins, which are opioid peptides found naturally in the hum an body. 4 Dr. Zadina 1 R. Doc. 235. The Court already has dism issed som e of these Counts. R. Doc. 30 1. The Court already has ruled on the m otion as to som e of the Counts. 3 R. Doc. 252, 346. 4 R. Doc. 233-1 at 8 , ¶ 16; R. Doc. 285 at 6, ¶ 16. 2 1 Dockets.Justia.com and Plaintiff the Adm inistrators of the Tulane Educational Fund (“Tulane”) obtained two patents, U.S. Patent Nos. 5,885,958 (“the ’958 Patent”) and 6,30 3,578 (“the ’578 Patent”), claim ing synthetic opioid com pounds. 5 On Novem ber 1, 20 0 6, Cytogel executed a contract entitled “Consulting Agreem ent”6 with Dr. Zadina, an em ployee of Tulane and the Departm ent of Veterans Affairs (“VA”). 7 In the contract, Dr. Zadina agreed to “provide advice and consultation on topics related to the developm ent of opioid com pounds for clinical application.”8 Cytogel alleges Dr. Zadina, as a consultant to Cytogel, accessed confidential data and inform ation relating to a synthetic opioid com pound called Cyt-10 10 . 9 Cytogel alleges Dr. Zadina used this inform ation to further his own secret work on the developm ent of closely-related opioid com pounds that would com pete directly with Cyt-10 10 . 10 From Septem ber 8, 20 10 onward, Cytogel “disengaged from ” Dr. Zadina. 11 On August 22, 20 12, Dr. Zadina and his colleague at Tulane Dr. Laszlo Hackler form ally assigned to Tulane and the VA their ownership rights to a patent application they filed for a group of synthetic opioid com pounds. 12 On May 6, 20 14, the resulting patent, U.S. Patent No. 8 ,716,436 B2 (“the ’436 Patent”), issued. 13 Cytogel alleges the com pound claim ed in the ’436 Patent is a “m odified version of Cyt-10 10 an d plainly designed to com pete with [Cyt-10 10 ] as a potential pharm aceutical treatm ent.”14 5 R. Doc. 233-1 at 8 , ¶ 16; R. Doc. 285 at 6, ¶ 16. R. Doc. 223-3. 7 R. Doc. 233-1 at 8 , ¶ 15; R. Doc. 285 at 6, ¶ 15. 8 R. Doc. 223-3 at 2, ¶ 1. 9 R. Doc. 220 at 13– 18. 10 Id. at 22, ¶ 61. 11 R. Doc. 233-1 at 9, ¶ 19; R. Doc. 285 at 7, ¶ 19. 12 R. Doc. 1 at 12, ¶ 47; R. Doc. 220 at 20 , ¶ 55. 13 R. Doc. 233-1 at 9, ¶ 20 ; R. Doc. 285 at 7, ¶ 20 . 14 R. Doc. 220 at 23, ¶ 64. 6 2 On August 19, 20 16, Tulane and the United States of Am erica filed suit against Cytogel. 15 Plaintiffs allege Cytogel has asserted sole ownership of the ’436 Patent and threatened to pursue legal rem edies against them . 16 They seek declaratory judgm ents of ownership and inventorship of the ’436 Patent. 17 On Septem ber 7, 20 16, Cytogel filed thirteen counterclaim s against Plaintiffs Tulane and the United States and Counterclaim -Defendant Dr. Zadina. 18 On April 11, 20 17, Cytogel filed its Am ended Counterclaim s, bringing the sam e thirteen claim s. 19 Neither Cytogel’s Counterclaim s nor its Am ended Counterclaim s m ention Dr. Hackler. On J uly 23, 20 18 , Cytogel filed its Second Am ended and Restated Counterclaim s, in which it added a fourteenth count for Correction of Inventorship of the ’436 Patent an d Related Patent Applications. 20 Cytogel’s Second Am en ded and Restated Counterclaim s m ention Dr. Hackler in passin g several tim es. 21 In the portion of the Second Am en ded an d Restated Counterclaim s regarding the n ewly added fourteenth counterclaim , Cytogel describes Dr. Hackler’s role in detail, alleging he “did not significantly contribute” to the invention of the ’436 Patent com pounds, and requests the Court rem ove his nam e as an inventor of the Patent. 22 On August 13, 20 18, Tulane and Dr. Zadina filed the instant Motion to Dism iss all of Cytogel’s Second Am ended and Restated Counterclaim s and First Am ended and Restated Affirm ative Defenses for failure to join Dr. Hackler’s estate, pursuant to Rule 15 R. Doc. 1. Id. at 14– 16, ¶ 53– 62. 17 Id. 18 R. Doc. 6. 19 R. Doc. 68. 20 Id. at 28 – 51. 21 Dr. Hackler is m ention ed in Count 1, describin g Dr. H ackler’s contributions to the ’436 patent; in Coun t 9, describin g Drs. Hackler and Zadina’s assignm ent of the ’436 Patent; and in Count 13, m ention ing the assign m ent R. Doc. 220 at 28 – 29, 39– 40 , 46– 47, ¶¶ 8 0 , 132– 33, 164– 65. 22 Id. at 47– 51. 16 3 12(b)(7) of the Federal Rules of Civil Procedure. 23 Alternatively, Tulane and Dr. Zadina seek dism issal of Count 14 of Cytogel’s Second Am ended and Restated Counterclaim s pursuant to Rule 12(b)(6). 24 Cytogel opposes this m otion. 25 On Septem ber 20 , 20 18, the Court, on its own m otion, ordered that there be a separate trial for Count 2 of the Com plaint and Count 14 of Cytogel’s Second Am ended and Restated Counterclaim s, which involve in ventorship of the ’436 Patent. 26 On Septem ber 21, 20 18, the United States filed the in stant Motion to Dism iss Counts 1, 8, 9, and 14 of Cytogel’s Second Am ended and Restated Counterclaim s. 27 Cytogel opposes this m otion. 28 RU LE 12 ( b) ( 7) STAN D ARD Rule 12(b)(7) of the Federal Rules of Civil Procedure allows dism issal for “failure to join a party under Rule 19.” Deciding whether or not to dism iss a case for failure to join an in dispensable party is a two-step inquiry. A court first determ ines if the party is a required party under Rule 19(a)(1). A party is required if (A) in that person’s absence, the court cannot accord com plete relief am ong existing parties; or (B) that person claim s an interest relating to the subject of the action and is so situated that disposing of the action in the person's absence m ay: (i) as a practical m atter im pair or im pede the person's ability to protect the interest; or (ii) leave an existing party subject to a substantial risk of incurring double, m ultiple, or otherwise inconsistent obligations because of the interest. 29 23 R. Doc. 235. Id. 25 R. Doc. 252. 26 R. Doc. 298 . 27 R. Doc. 30 1. 28 R. Doc. 346. 29 F ED . R. CIV. P. 19(a)(1). 24 4 Required parties m ust be join ed if feasible. 30 “If a person who is required to be joined if feasible cannot be joined, the court m ust determ ine whether, in equity and good conscience,” the action should be dism issed. 31 A court m ay consider factors including: (1) the extent to which a judgm ent rendered in the person's absen ce m ight prejudice that person or the existing parties; (2) the extent to which any prejudice could be lessened or avoided by; (A) protective provisions in the judgm ent; (B) shaping the relief; or (C) other m easures; (3) whether a judgm ent rendered in the person's absen ce would be adequate; and (4) whether the plaintiff would have an adequate rem edy if the action were dism issed for nonjoinder. 32 A district court m aking a Rule 19 decision m ust consider the pragm atic, fact-based, an d practical effects of joining or declining to join a party. 33 LAW AN D AN ALYSIS Tulane and Dr. Zadina argue that, because Dr. Hackler is a nam ed inventor on the ’436 Patent, his estate is entitled to receive royalties from the patent, and he is an indispensable party to an action in which the inventorship of the ’436 Patent m ay be changed. 34 In reality, Tulane and Dr. Zadina’s argum ents relate only to Count 14 of Cytogel’s Second Am ended and Restated Counterclaim s, but they m ove the Court to dism iss all of Cytogel’s Second Am ended an d Restated Counterclaim s pursuant to Rule 12(b)(7) of the Federal Rules of Civil Procedure. Counts 1– 13 of Cytogel’s Second Am ended and Restated Counterclaim s do not involve Dr. Hackler and were originally pleaded without m entioning him . 35 Because Tulane and Dr. Zadina do not present argum ents that Counts 1– 13 should be dism issed 30 Id. 31 F ED . R. CIV. P. 19(b). Id. 33 See Pulitzer-Polster v. Pulitzer, 784 F.2d 130 5, 130 9 (5th Cir. 1986). 34 R. Doc. 235-1. 35 R. Docs. 6, 68 . 32 5 pursuant to Rule 12(b)(7), the Court finds Dr. Hackler is not a required party for those counts pursuant to Rule 19(a)(1) of the Federal Rules of Civil Procedure. The Court den ies Tulane and Dr. Zadina’s m otion as to these counts. Count 14 of Cytogel’s Second Am ended and Restated Counterclaim s will be addressed at a separate trial, to be scheduled at a later date. 36 The Court denies without prejudice Tulane an d Dr. Zadina’s m otion to dism iss Count 14 pursuant to Rule 12(b)(7), or, in the alternative, pursuant to Rule 12(b)(6). The Court also denies without prejudice the United States’ m otion to dism iss Count 14 pursuant to Rule 12(b)(7). Tulane, Dr. Zadin a, an d the United States m ay refile the relevant portions of the instant m otions in connection with the trial on Count 2 of the Com plaint and Count 14 of Cytogel’s Second Am ended and Restated Counterclaim s. CON CLU SION For the foregoing reasons, IT IS ORD ERED that the Motion to Dism iss Defendant Cytogel Pharm a, LLC’s (“Cytogel”) Second Am ended and Restated Counterclaim s pursuant to Rule 12(b)(7) of the Federal Rules of Civil Procedure or, in the Alternative, to Dism iss Count 14 of Cytogel’s Second Am ended and Restated Counterclaim s pursuant to Rule 12(b)(6), filed by Plaintiff the Adm inistrators of the Tulane Educational Fund (“Tulane”) and Counterclaim -Defendant Dr. J am es E. Zadin a 37 be an d hereby is D EN IED as to Counts 1– 13, and D EN IED W ITH OU T PREJ U D ICE as to Count 14. Tulane and Dr. Zadina m ay refile the m otion as it pertains to Count 14 at the tim e of the second trial in this case. IT IS FU RTH ER ORD ERED that the Motion to Dism iss Counts 1, 8 , 9, and 14 of Cytogel’s Second Am ended an d Restated Counterclaim s, filed by Plaintiff the United 36 37 R. Doc. 298 . R. Doc. 235. 6 States of Am erica, 38 be and hereby is D EN IED W ITH OU T PREJU D ICE as to Count 14. The United States m ay refile the m otion at the tim e of the second trial in this case. IT IS FU RTH ER ORD ERED that the Tulane, Dr. Zadina, and the United States file responsive pleadin gs to Cytogel’s Second Am ended and Restated Counterclaim s by no later than Mo n d ay, N o ve m be r 12 , 2 0 18 , at 5:0 0 p .m . 3 9 N e w Orle a n s , Lo u is ian a, th is 2 9 th d ay o f Octo be r, 2 0 18 . ________________________________ SU SIE MORGAN U N ITED S TATES D ISTRICT J U D GE 38 R. Doc. 30 1. The Court has ruled on all m otions to dism iss. Under Rule 12(a)(4) of the Federal Rules of Civil Procedure, if the Court denies a m otion to dism iss, “[u]nless the court sets a different tim e, . . . the responsive pleadin g m ust be served within 14 days after notice of the court’s action.” 39 7
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