Ferring B.V. et al v. Allergan Inc. et al, No. 1:2012cv02650 - Document 57 (S.D.N.Y. 2013)
Court Description: OPINION re: 26 MOTION to Dismiss filed by Allergan Sales, LLC, Allergan USA, Inc., Allergan Inc. Based upon the facts and conclusions set forth above, the Defendant's motion to dismiss is granted as to all counts, except for Counts 1 through 3. (Signed by Judge Robert W. Sweet on 3/18/2013) (cd)
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UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK -- --- x FERRING B.V., FERRING INTERNATIONAL CENTER S.A., AND FERRING PHARMACEUTICALS INC., Plaintiffs, 12 Civ. 2650 against OPINION ALLERGAN, INC., ALLERGAN USA, INC., ALLERGAN SALES, LLC, SERENITY PHARMACEUTICALS CORPORATION, SERENITY PHARMACEUTICALS, LLC, REPRISE BIOPHARMACEUTICS, LLC, SEYMOUR H. FEIN, AND RONALD V. NARDI, Defendants. - -- -- - -- -- --------- --x A P PEA RAN C E S: Attorneys for Plaintiffs GIBBONS P.C. One Gateway Center Newark, NJ 07102 By: Mara E. Zazzali-Hogan, Esq. William P. Deni, Jr., Esq. FINNEGAN, HENDERSON, FARABOW, GARRETT & DUNNER, LLP 901 New York Avenue, N.W. Washington, D.C. 20001 4413 By: James B. Monroe, Esq. Paul W. Browning, Esq. Adriana L. Burgy, Esq. Attorneys for Defendants GIBSON, DUNN & CRUTCHER LLP 200 Park Avenue New York, NY 10166-0193 By: Joseph Evall, Scott A. Leslie, Esq. GIBSON, DUNN & CRUTCHER LLP 3161 Michelson Drive Irvine, CA 92612 By: Jeffrey T. Thomas, Esq. Jeffrey H. Reeves, Esq. ZUCKERMAN SPAEDER LLP 1185 Avenue of the Americas New York, NY 10036 By: James Sottile, Esq. Steven M. Cohen, Esq. Noah Solowiejczyk, Esq. Sweet, D.J. Defendants Allergan, Inc.; Allergan USA, Inc.; and Allergan Sales, LLC (col Pharmaceuticals Corporat (collect ctively, "Allergan"); Serenity , Serenity Pharmaceuticals, LLC , "Serenity"), Reprise Biopharmaceutics, LLC ("Reprise"), Dr. Seymour H. Fein ("Fein") and Dr. Ronald V. Nardi ("Nardi") (collectively, the "Defendants") have moved pursuant to Rules 8, 9(b), and 12(b) (6) of Federal Rules Civil Procedure to di ss the complaint (the "Compl If) of plaintiffs Ferring B.V., Ferring International Center S.A., and Ferring Pharmaceuticals Inc. " (collect ly, "Ferring" or the iffslf) alleging seventeen causes of action arising out of the obtaining and use of certain patents by the Defendants. Based upon the conclusions set forth below, the Defendants' motion is granted as to Counts 4-17 and denied as to Counts 1-3. I. The Facts & Prior Proceedings 1 Desmopressin is a ic hormone used to treat a variety of disorders related to excessive urine production. See Compl. ~~ 27-28}. Ferring devel the world's first pharmaceuti desmopressin products, as a treatment for desmopressin in Denmark diabetes insipidus. 1972 (rd. , 29) Over the past several decades, Ferring almost singlehandedly built the current desmopress market by leading the in developing novel formulations and obtaining regulatory approval to treat an increas number of disorders. rd. " 29 44) . Given its efficacy, safety profile, and worldwide commercial s various desmopressin products today success, Ferring under the Minirin® tradename and continues to conduct research and development ("R&D") on desmopressin. rd. " 29, 30). smopressin's success in treating central diabetes ipidus, a Ferring affiliate doctor in Denmark, a Peter Norgaard ("Norgaard"), then a grant to that deC!m(')1"\,r this di effectively treating tigate the possibility nocturnal enuresis. (rd. , 31). 1984 awarded Dr. Jens Norgaard's work established in successfully treated children suffering from , enabling Ferring to 2 a regulatory approval and launch desmopressin for this purpose. (rd.) After becoming an employee with a Ferring affiliate, Norgaard also led the effort to gain regulatory approval for desmopressin as a treatment for nocturia, further expanding the reach of desmopressin therapy and Ferring's Minirin® products. 32 1 33). (rd. ~~ During the 1990s 1 Norgaard also investigated an adverse side effect associated with water retention causes an imbalance in blood in which excess sodium levels. smopressin, hyponatremia [ rd. ~ 33). His research into dosage levels led him to recognize that higher doses stronger antidiuretic effect duration of action. rd. ~~ l rather than generating a l simply extend desmopressin's 34, 35). Dr. Thomas Senderovitz ("Senderovitz") joined Ferring soon thereafter to build a pharmacokinetics department and began collaborating with Norgaard. rd. ~ 35). Senderovitz began pooling data both from in and outside of Ferring to generate comprehensive analyses of desmopressin1s properties internally as the EMF study. rd. ~~ 35, 37). l known Norgaard and Senderovitz confirmed that desmopressin was far more potent than previously understood and that even low doses may yield maximum antidiuretic ef of action. 1 while higher doses merely extend duration rd. ~~ 35, 36). Given these findings and the 3 dosages may increase understanding that sk of hyponatremia, Norgaard and Senderovitz proposed dosages designed to achieve maximum plasma levels of approximately 6 7 pg/ml or lower, yielding a duration of six hours or less. (Id. ) Their studies later served as a basis for Ferring clinical studies targeted at further evaluating the efficacy of low doses of desmopressin. rd. ~ 38) . On August 30, 2001, Ferring dec to proceed with an orodispersible formulation project, and Senderovitz and his pharmacokinetics group developed study protocols in support of this endeavor. (rd. at ~ 44.) Consistent with previous development plans considered in the 1990s, these protocols specified us tablet. the orodispersible ation as a sublingual rd. Fein and Nardi worked Ferring's former Tarrytown, New York office beginning in the 1990s. (rd. ~ 46) . An "Employment Agreement" executed in connection wi promotion legedly manifests Nardi's "agree [ment] to assign his ownership rights to any invention (or any improvement upon or addition to an invention) carri on by Ferring that icable to the business then being made, discovered, or 4 participated in the discovery of" during the course of his employment. (Id. ~ 48) . When Nardi joined Ferring, he began working with Fein, then a consultant for Ferring. (Id. ~ In 1997, Fein 52.) became an employee at Ferring with the position of Executive Director, Clinical Research and Medical Affairs. (Id. ~ 53.) He was an employee for just one year, however, and then resumed his consulting role. (See id. ~~ 54-56.) In 2001, while Fein was a consultant, his "duties and responsibilities expanded to include assisting with developing (and potentially patenting) a desmopressin formulation." (Id. ~ 56.) Fein "continued to hold himself out as Medical Director" during that period. (Id. ~ 59). For most of their tenure, neither Nardi or Fein nor that office had any involvement in desmopressin R&D. (Id. ~ 50). After Nardi became Executive Vice President, Research and Development and Chief Scientific Officer on August 1, 2001, his responsibilities expanded to include Ferring's development of the new orodispersible desmopressin formulation. (Id. ~~ 47, 50). His performance objectives and bonus criteria for 2001/2002 depended in part on obtaining patent protection for this formulation. (Id. ~ 50) . 5 Fein became a senior management member of Ferring's high-level Research Development Marketing committee ("RMDC Id. ~ 57) and began travell tI ) to Copenhagen to attend various meetings concerning Ferring's global research and development. Id. as the sponsor on several Fein also later clinical studies, signing on Ferring's behalf and holding himself out as Medi rector, Ferring Research and Id. ~58). Development. Fe was one of the most highly Id. ~ 60). compensated employees at Ferring in 2001 and 2002. As of December 2001, Nardi was unaware of of the orodispersible study, internally designat ~ 51.) When he status CS004. (Id. red about its status, Senderovitz informed him that the protocol, specifying sublingual delivery and naming Senderovitz as study sponsor, had been comple similarly did not 2002. icipate in any desmopres Id. Fein meetings until Id. ~ 57). filed a patent appl orodispers ion on an e desmopressin formulation in Great Britain on May 7, 2002, without identifying any inventors, and then filed a Patent Cooperation Treaty ("peTti) application on September 20, 2002, ifying an initial set of s 6 inventors, (Id. ~~ 62, 63), including Fein and Nardi based on their representations that they allegedly contributed the "sublingual" aspect of the orodispersible formulation. (Id. ~ 65). With Nardi and Fein listed as inventors, Nardi could claim that he had fulfilled his performance objective of obtaining patent protection for the orodispersible desmopressin formulation. 2002 memorandum, (rd. ~ 65) . rn a May Fein asserted that he made these alleged contributions jointly with Nardi and did so in the course of his regular duties at Ferring. (rd. ~ 66) . Ferring terminated Nardi soon after the peT filing. (See id. ~ 67). In his severance agreement, Nardi reaffirmed that he would fulfill the post-employment obligations detailed in his August 1, 2001, employment agreement. 68, 69). (rd. ~~ 47, 48, He reaffirmed that he would assign his ownership rights to any inventions he made, discovered, or participated in discovering in the course of his employment. (rd. ~ 68). He also reaffirmed that he would return all electronic and hard copy documents and materials containing information relating to Ferring's business, including trade secret and confidential information. (Id. ~ 69). Nardi further reaffirmed that he would keep secret, at all times, information concerning Ferring's organization, business, and finances, 7 including rd. t severance During his termination and s, Nardi provided explicit assurances that was complying wi his obligations and returning all of his hard copy files and e c documents on his home computer. Ferring Fe shortly thereafter on November 7, 2002, and directed him to return I Ferring materials, including computer files, wherever located. Before leaving , Inc. trade secret Ferring i information, including the of Norgaard and Senderovitz. CNF and Markus have Main Street, Suite 400, New same address: 120 North Id. ~ 80) . ty, New York, 10956. the commerci Fein and Cheng sought investors ~ ("Markus"), continued er the termination of Fein and Nardi and to have access to conf desmopressin (rd. 70) . , working with Maria Cheng ("Maria Cheng") at Markus Re (Id. ~ 78) . ~ ("Cheng"), a consultant for (rd. ~~ 52, 77) to consult for Ferring rd. , Fein incorporated CNF Pharma, LLC ("CNF") with Linda Ferring. (rd. ization of 79), but kept their CNF venture and joint Id. ~ 77). activities secret from Ferring. On May 6, 2003, Fein filed a PCT patent application (App. No. PCT/US03/14463) claiming priority to Ferring's May 7, 2002 British See id. ~ 74.) Approximately six months later, he 8 ication. i what would ultimately issue as his U.S. Patent No. 7,799,761 (the "'761 Patent"), which disclosed various pharmaceuti compos containing low dosages for claimed rd. ~ ority to the smopressin; he again tish application. (See id. Ex. Ci 74) Fein filed his patent applicat in 2003 and represented that his patent would be directed to some sort subject matter relating to sublingual desmopressin. 74). (rd. ~~ 73 In 2004, in response to Ferring's inquiry, Fein's counsel stated that applications contained no confidential information. ng now claims that Fein and Nardi used Fe "confidential, trade secret, proprietary, and privileged information" to design and conduct clinical studies of desmopressin and to obtain and commercialize patents. 75-76). Fein subsequently fil a divisional application for what would issue as U.S. Patent No. 7,405,203 (the "'203 Patent"), and a continuation application for what would issue as U.S. Patent No. 7,579,321 (the '''321 Patent"). B). Fein assigned fendant Reprise s interest in 2008. se applications to (rd. ~~ 84,90). 9 See id. Exs. A, Fein and Cheng approached Nardi for help in their venture and in locating potential investors by at least 2004, rd. and Nardi began working for CNF Pharma as a consultant. 81). ~ Fein later incorporated Serenity, located at the same address as CNF and Markus, to focus on desmopressin and investors, hiring Nardi as a pa Fein then incorporated consultant. Id. ~ 82, 83). se, located at the same address as Serenity Corp., CNF, and Markus, to similarly focus on Id. desmopressin and investors. ~~ 84, 85). and equity participants in Reprise, and Cheng are principals and Maria Cheng are partners. Id. ~ 84). rights in patent applications relating to Reprise. Id. Fein and Nardi ~ 90). Fein assigned his smopressin to In 2009, Serenity was incorporated with Fein having the title of Chief Medical Officer. When Fe . ~ 105). obtained a patent on July 29, 2008, U.S. ent") , Fein's alleged Patent No. 7,405,203 (the "'203 s patent included claims directed to invention had changed. treatment methods involving maximum plasma concentration of lower than 10 pg/ml. Id. ~~ 91, 92). He obtained a second patent on August 25, 2009, U.S. Patent No. 7,579,321, patent, also including claims involving maximum plasma 10 '321 (rd. ~~ 94, 95). concentrations of lower than 10 pg/ml. patents list Fein as t e inventor. On April I, 2010, global agreement with All Both (Id. ~~ 91, 94). se and Serenity entered a for the development and commercialization of SER 120, a Phase III investigational drug comprising a desmopressin formulation administration. (Id. ~ 106). intranasal te Fein, Nardi, Cheng and Maria Cheng all having past employment at Ferring where they worked on desmopressin, none s to the SER-120 agreement attempted to clear any claims or otherwise contact Ferring during any due dil fore the agreement. Reprise purportedly assigned the two is as well as a pending patent application. patents to Allergan, (Id. claimed compositions purportedly establi concentrations lower than 10 pg/ml 99). asma de It also lists Fein as sole inventor. The '761 patent ssin. (Id. ~~ 97 Id. ~ 97). In 2011, Ferring brought entitlement proceedings Fein and Reprise concerning a European ent ion in the District Court of The Hague in the Netherl brought In response, Allergan, Serenity, Reprise, and Fein ent entitlement claims against Ferring. 11 Id. ~ 107). On January II, 2012, Allergan, Serenity, se, and Fein filed certain exhibits in the Netherlands proceedings alleged by Ferring to contain its confidential and trade secret information, (rd. " 108, 109), including presentations given by Nardi to Ferring's Board of Directors that contain desmopressin EC50 data (indicating the plasma concentration at which half of maximum cl cal effect is present) developed by Norgaard and Senderovitz in t cl cal effect EMF study, directly illustrating the ss of low desmopress plasma levels, internal minutes from high level Ferring R&D committees with restricted distribution lists, internal Ferring emails, an entry from Nardi's Outlook calendar while at Ferring, int Ferring R&D memoranda with confidentiality legends and a witness statement from Nardi stating he was assisting Al Serenity, Reprise, and Fein in these proceedings. The Dist (rd. , 108) ct Court of The Hague granted Ferring's request to See id. , 116). keep those documents confident On January 22, 2012, Ferring demanded that Fein, Reprise, Serenity, and Allergan withdraw return all ng information. ir exhibits, and rd. , 114). 12 The Complaint was filed on April 5, 2012. On June 29, 2012, Defendants' filed the instant motion to dismiss, and the motion was heard and marked fully submitted on September 19, 2012. II. Discussion On a motion to dismiss pursuant to Rule 12 (b) (6), all factual allegations in the complaint are accepted as true, and all inferences are drawn in favor of the pleader. Polar Molecular Corp., 12 F.3d 1170, 1174 Mills v. (2d Cir. 1993). "'The issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims . , II Villager Pond, Inc. v. Town of Darien, 56 F.3d 375,378 (2d Cir. 1995) (quoting Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S. Ct. 1683, 40 L. Ed. 2d 90 (1974)). To survive a motion to dismiss pursuant to Rule 12 (b) (6), "a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 129 S. Ct. 1937, 1949, 173 L. Ed. 2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955, 167 L. Ed. 2d 929 13 (2007)). Plaintiffs must allege sufficient facts to "nudge [ their claims across the I ______~, 550 U.S. at 570. factual allegations from conceivable to plausible." Though the Court must accept the a compl as true, it is "'not bound to accept as true a legal conclusion couched as a factual all ion.'" Iqbal, 129 S. Ct. at 1950 (quoting Twombly, 550 U.S. at 555). In addition, the expiration of the statute of limitations is an affirmative defense under which the defendant bears the burden of proof. Fed. R. Civ. P. 8(c). With regard to motions to dismiss based on a statute of limitations defense, "[a]lthough the triggering inappropriate inquiry notice is an issue 'often resolution on a motion to smiss,' where 'the s needed for determination of when a reasonable investor of ordinary intelligence would have been aware of the existence of fraud can be eaned from the complaint and papers integral to the complaint, resolution of the issue on a motion to dismiss is appropriate.'" Masters v. GlaxoSmithKI Fed. Appx. 46, 48 (2d Cir. 2008) Secs. (citation omitted); see also Inc., 12 F.3d 346, 352 n.3 ~~~--~~~~~~--~------ (noting the "vast number , 271 cases in this ci [notice] issues at the pleading stage.") 14 (2d Cir. 1993) t resolving A) Counts 1-3 (Inventorship Claims) Are Not Barred By Laches Unacceptable neglect or delay in promptly asserting a claim for relief, if such neglect or delay causes prejudice to the adverse party, invokes the doctrine of laches, barring enforcement. See A.C. Aukerman Co. v. R.L. Chaides Constr. Co., 960 F.2d 1020, 1028 29 . Cir. 1992). "To prevail on a defense of laches, a defendant must establish that (1) the plaintiff's delay in filing a suit was 'unreasonable and inexcusable,' and (2) the defendant suffered 'material judice attributable to the delay.'ff Hor v. Chu, 699 F.3d 1331, 1334 (Fed. C . 2012) A (quoting A.C. Aukerman, 960 F.2d at 1028). lay of more than six years " er the omitted inventor knew or should have known of the issuance of the patent will produce a rebuttable presumption of laches." Cardiovascular Inc. v. Scimed Advanced . Inc., 988 F.2d --------~--------~--~--~--------~~--------~------- 1157, 1163 (Fed. Cir. 1993) i see also Moore v. Broadcom No. C06-05647 MJJ, 2008 WL 425932, at *3 2008) (N.D. Cal. Feb. 12, (stating that the factors giving rise to laches "are presumed upon proof that the [allegedly omitted inventor] delayed filing suit for more than six years after actual or 15 ., constructive knowledge of the claim. "With the presumption, lf ) ¢ the facts of unreasonable delay and prejudice must be inferred, absent rebuttal evidence." Mahmood v. Research in Motion Ltd., No. 11 Civ. 5345 (KBF) , 2012 WL 242836, at *7 (citing to A.C. Aukerman, 960 F.2d at 1937). The application of laches "is committed to t discretion of the district court.1f ics sound Serdarevic v. Advanced Med. Inc., 532 F.3d 1352, 1358 (Fed. Cir. 2008). Courts have found that "when the defense of laches is clear on the face the complaint, and where it is clear that the plaintiff can prove no set of facts to avoid the insuperable bar, a court may consider the defense on a motion to dismiss." Lennon v. Seaman, 63 F. Supp. 2d 428, 439 (S.D.N.Y. 1999). According to the Complaint, Ferring notified Fein in early 2003 that it was removing Fein and Nardi as inventors from its patent filings because their contributions were "unpatentable" (see Compl. ~~ 71-72). On April 17, 2003, Fein's counsel responded that Fein would pursue "his own patent application" on "subject matter relating to sublingual desmopressin with alleged low dosage possibilities. 1f 16 See id. ~ 73i Reeves Decl. Ex. 4 (4/17/2003 Email from W. Speranza to P. Barclay) ) . According to the Defendants, Ferring had "actual notice" of this correspondence and "relied upon these documents in framing the complaint." (Def. Memo. at 7 n. 5) (citing Cortec Industries, Inc. v. Sum Holding L.P., 949 F.2d 42, 48 1991) i Chambers v. Time Warner, Cir. 2002) (2d Cir. Inc., 282 F.3d 147, 152-53 (2d (contracts relied upon by plaintiff in drafting complaint may be considered on Rule 12(b) (6) motion)). They contend that Ferring has not challenged the use of the correspondence and therefore may consider it on its motion to dismiss. Specifically, In a letter dated December 9, 2004, Ferring's counsel raised "concerns that Fein's patent application might include confidential Ferring data." Compl. ~ 75i Barclay to w. (See Reeves Decl. Ex. 5 (4/29/2003 Letter from P. Speranza)). Ferring's general counsel acknowledged that she had "noted the publication of PCT/ US 2003/014463 entitled "Pharmaceutical composition including low dosages of desmopressin." Id. Ferring's counsel also stated that "Ferring will take all necessary steps to protect its 17 rights and erest," and expressly threatened to "commence formal I action" against Fein and his attorney if they did not respond "with a satisfactory explanation within 14 days." rd. After Fein's attorney responded, Fe did not hear from Ferring until it filed its lawsuit almost eight years later. According to the Defendants, nine years have therefore passed between the time Ferring received actual notice of Fein's patent applications and the commencement of this action. On the other hand, according to Ferring, language of the statute demonstrates plain the patent must be issued first and the laches clock does not run prior to issuance. Under 35 U.S.C. inventorship of is § 256, dis courts may correct patents in the following situations. Whenever through error a person is named in an issued patent as the inventor, or through error an inventor is not named an issued patent and such error arose without any deceptive intention on his part, [t]he court be which such matter is called question may order correction the patent on notice and hearing of 1 parties concerned and Director shall issue a certificate accordingly. 35 U.S.C. § 256. issued, can a § Ferring contends that only once a patent is 256 claim accrue, and that "[d]istrict courts do not have the power to correct inventorship 18 pending patent applications. II (Pl. Opp. at 10-11). the laches period Thus, Ferring avers that should be measured from date that the patents-in-suit were issued, September 21, 2010 the '761 patent, August 25, 2009 for the '321 patent, and July 29, 2008 for the '203 patent. rcuit recently issued a decision The addressing this issue in Hor v. Chu. inventorship c With respect to , the Court reaffirmed its prior holding in Advanced Cardiovascular that laches for a begin prior to issuance. that "the 1 § Federal Circuit Specifically, s period for a the issuance of the or knew or should , regardless of whet the omitted inventor knew or should known of the omitted was pending before inventorship while the patent applicat PTO." Hor, 699 F.3d at 1336 37. Court reli In reaching its holding, of on the statutory latches cannot begin, until § 256 to confirm patent actually issues. 1336 (stating that "[n]othing the plain language of the accompanying regulations cates that the cha11 inventorship be from later contest ld 256 correction of inventorship § claim begins to run when the omitted have known 256 claims does not 19 § 256 or to PTO can potent inventorship under Id. at bar an § 256."). All has also asserted one delay period for 1 three patents in-suit, but "each patent is a separate chose in action." ____________________~____~_____ , 29 F.3d 1570, 1576 (Fed. Cir. 1994) (Stark I). The Circuit stated that "the general rule is that the 1 s period does not accrue until each patent issues, even if the patents are interrelated." Id. at 1576. Here, the '761 patent was issued on September 21, 2010, the '321 patent was issued on August 25, 2009, and the '203 ent was issued on July 29, 2008. Thus, the period April 5, 2012 filing date ranges between patent issuance and from one year and six months to three years and e whi delay required to invoke a are less than the s presumption of laches. months, Accordingly, the laches period began to run once the patents-in- t were issued and 's § 256 claims are not barred by 1 B) Counts 4 And 5 (Ownership Dismissed Cla~s) Are Time Barred And Where the complaint "clearly shows time," it should be dismissed with prejudice. 20 claim is out of See Troni v. Holzer, No. 09 Civ. 10239 (WHP), 2010 WL 3154852, at *2-5 (S.D.N.Y. July 29, 2010) smissing on statute limitations grounds); - - - -so Gonzales v. Nat'l Westminster see Bank PLC, 847 F. Supp. 2d 567, 570 (S.D.N.Y. 2012) facts can be gl ("Where the from the complaint, papers integral to the complaint, and icly disclosed documents, ion of the limitations issue on a motion to dismiss is a ppropriat e . If ) ( quo t i ng .=I.=n.=.=r.=e.=.=S.=a.=.=l_o_m_o-=n.=.=A-=n-=a.=.=-=--:::..=t.=.=W.=l=-·n_s-=-=t.=a.=r.=.=L.=i.=t=-=-~. , 373 F. Supp. 2d 241, 245 (S.D.N.Y. 2005)) marks and brackets omitted) 112 (2d Cir. 2000) i (internal quotation Cuoco v. Morit , 222 F.3d 99, smissal without leave to amend is warranted where amending the complaint would prove futile in curing its deficiencies) . Counts 4 and 5 assert ownership of the Ferring is entitled to ents-in-suit. Specifically, Count 4, Ferring has contended that it is a rightful owner of Fein's s because Nardi co-invent was required by the claimed subject matter and s Employment Agreement to assign ownership rights to any invention he developed while employed at Ferring. See Compl. ~~ 167 172). 21 To begin with, Ferring has contended that "third party transferees of misappropriated patents are proper defendants in inventorship and ownership actions." See Pl. Opp. at 21) (citing Yeda Research & Dev. Co. Ltd. v. rmcl F. Supp. 2d 570, 577-78 (S.D.N.Y. 2006) i , 443 St. John's Univ. v. Bolton, 757 F. Supp.2d 144, 154 (E.D.N.Y. 2010». However, in Yeda, one defendant was the successor in interest to the organization that employed the named inventors, and the other was an exclus prosecution. licensee that agreed to take over the patent's See Yeda, 443 F. Supp. 2d at 577-78. In Bolton, two defendants filed for the patents, and were the sole shareholders in the third defendant, which was assigned the patents. See Bolton, 757 F. Supp. 2d at 154. supports the aims against Neither case lergan, which has no such relation to the patents-in-suit. Although Count 4 is asserted against all Defendants, there are no allegations that lergan was involved in the inventions or that Allergan is a party to, or beneficiary of, Nardi's Employment Agreement. Allergan is not alleged to have any involvement with Fein's and Nardi's work until 2010. Compl. , 106). (See In Count 5, Ferring has also alleged that obligation to assign Fein's patents was impli 22 I rather than contractual. (See Compl. ~~ 181-83). As with Count 4, Ferring has not alleged that Allergan was involved in the invention of the claimed subject matter or that it was involved with Fein's consulting relationship with Ferring. Accordingly, Counts 4 and 5 are dismissed as against Allergan with prejudice. Ferring has contended that "by virtue of Fein's and Nardi's positions at Reprise and Serenity, Reprise and Serenity are liable for the actions of their members or officers when acting in these capacities." However, Counts 4 and 5 assert that Nardi and Fein are obliged to assign patents to Ferring by virtue of associations with Ferring that ended in 2002, several years before Reprise or Serenity were even formed. Thus, Counts 4 and 5 are also dismissed with respect to Reprise or Serenity because Ferring nowhere alleges that Reprise or Serenity had any relationship or obligation to Ferring. In addition, Ferring has recast Claims 4 and 5 as actions for replevin, so that the statute of limitations does not begin to run until "demand and refusal." 21) (See Pl. Opp. at (citing Leadertex, Inc. v. Morganton Dyeing & Finishing Corp., No. 93 Civ. 3755 Aug. 17, 1994) (KTD) , 1994 WL 445618, at *5 (action for replevin of fabrics)). 23 (S.D.N.Y. Count 4 sounds in breach of contract, not replevin, and must be brought within six years of the leged breach-here, Nardi's alleged failure to asslgn rights in patent applications first pursued in 2003, See Compl, ~~ 168-70) i see so Bd, Of Trustees of ------ --=L-=e-=l:.. :a,, ,n-=d=--=--=S-=t-=a--=n--=f-=o--=r-=-=d-=..=J-=u-=n-=l=-·o-=-=:.r-=..=U-=n--=l: . V..=-=,---=v-=,---=R-=o--=",-c--=h-=e---=M-=o--=l=..-=e-=c-=u-=l:.. :a.::.:. .:r-=-=:'::::.d-=-=,--,----=:::.I; ;.:.n-=c:. .:. . , 5 8 3 · F.3d 832, 847-48 (discussing that a cause of action for patent ownership accrues upon knowledge of patent application) . Moreover, under Count 4, Ferring's c im for patent ownership based on Nardi's Employment Agreement is time-barred. In New York, actions sounding in breach of contract must be commenced within six years 213(2) (McKinney 2012) Bank, No. 08 Feb. 4, 2010), i the alleged breach. Malone v. N.Y.C.P.L.R. Und Vereins -----------~~------~~--~-------- . 7277 (PGG) , 2010 WL 391826, at *5 (S.D.N.Y. f'd sub nom. Malone v. Und -----------~~--------~~----- Vereinsbank, AG, 425 F. App'x 43 (2d r. 2011). Ferring has alleged that it owns Fein's patents because Nardi breached his contractual obligation to assign his ownership rights to any invention he discovered or participated in the discovery of during his employment. (See Compl. employment, however, ended in 2002 ~~ 169-71). see id. ~ Nardi's 67), and the leged breach could have occurred no later than 2003, when Fe 24 first pursued his patent applications without naming Ferring as the assignee. Ferring knew of Fein's patent applications 2003; but even ignorance of the applications cannot save the claim, because "[t]he plaintiff need not be aware of the breach or wrong to start the [limitations] period running." Worldwide 2010) See Marvel , 756 F. Supp. 2d 461, 470 Inc. v. Ki (S.D.N.Y. (dismissing breach of contract counterclaims as time barred even though plaintiff may not have been aware of breach when it occurred) 149 (2d dismis (quoting Guilbert v.Gardner, 480 F.3d 140, . 2007)). Count 4 is therefore t barred, and is with prejudice. Under Count 5, Ferring seeks equitable relief breach of "fiduciary dut to Ferring" Claims based on breach of fiduc see Compl. ~~ 182 83). duties must be brought within six years of when "the claim becomes enforceable, i.e., when all elements complaint." the tort can be truthfully alleged in a See IDT Corp. v. Morgan Stanley Dean Witter & Co., 12 N.Y.3d 132, 140, 879 N.Y.S.2d 355 (N.Y. 2009) omitted); see also N.Y.C.P.L.R. 213 (1) (citations (McKinney 2012). Ferring was on notice of Fein's efforts to obtain his patents no later 25 than 2003. Any damages from in's efforts to obtain patents could have been alleged at that time, notwithstanding Ferring's claim that it "has additionally been damaged in an amount . no less than $43 million" (the amount of Allergan's up-front payment for the patent assignments in 2010). 194, 206). See Compl. Because Ferring could have brought ~~ claim nine years before it did and more than six years have when the claim became enforceable, Count 5 is dismissed as untimely under the six-year statute of limitat C) Counts 6 And 7 (Breach Of Common Law Duty) Are Dismissed In Counts 6 and 7, Ferring has alleged that Fein and Nardi owed "common law duties," such as "duties of confidentiality, loyalty, good faith and fair dealing with employer, and/or fiduciary duties." (Compl. ~~ 186, 199). Fein Nardi allegedly breached those duties by "using" Ferring "confidential information" in designing and conducting clinical studies and obtaining commercializ patents on Fein's ions, and by providing Ferring documents to other defendants for submission as evidence in The Hague Action. id. ~~ 187-89, 200-01). Specifically, Fe "documents c o n t a i n i n g ' s confident 26 See and Nardi provided , trade secret, proprietary, and privileged information to" the other defendants . submissions to the "for use in . in proceedings adverse to Ferring." 200). strict Court of The Hague (See Compl. ~~ 187-88, Ferring also alleges breach contract aims with respect to the same set of facts and that also is ground for di smi s sal. See, e. g ., Harr.~i_s_v_._P_r_o_v_i_d_e_n._t_L_i ___ &_A_C_c_i_d_e_n_t_I_n_s_. Co., 310 F.3d 73, 80-81 (2d Cir. 2002) ("New York law. does not recognize a separate cause of action for breach of the implied covenant of good faith and fair dealing when a breach of contract cIa ,based upon the same facts, is also pled.") . The alleged damages stem from the alleged breaches of common law duties because Fein "obtained at least three patents" and the non-Allergan defendants "have received at least $43 million in payments from Allergan to date." Id. ~~ 192, 204}. Yet neither of these alleged harms, even if they were cognizable damages, could be "damages directly caused by [Allergan's] misconduct," as required to state a claim against Allergan. Palmetto Partners A.D.3d 804, 807, L.P. v. AJW lified Partners 921 N.Y.S.2d 260 (2d Dep't 2011) See LLC, 83 (finding that a lower court should have dismissed a claim for breach of fiduciary duty because plaintiffs "suffered no damages from any breach of fiduciary duty.") (citations omitted) . 27 The al damages here are unrelated to the document submissions in Hague. The last Fein's three s were issued in 2010, the same year that Reprise and Serenity assigned the patent s to Allergan. See Compl. ~~ 97, 106). The document submissions, however, did not occur until January 11, 2012. See id. more than a ~ 108). The al ion of damages before the all fered were breaches and thus unavailing. The claims for breach of common law duties are also time-barred. ~~ Since Ferring 196, 208), its breach equitable relief fiduciary duty claims are governed statute of limitations that beg by a six- see Compl. accruing "when all elements of the tort can be truthfully alleged in a complaint." 213(1) See IDT Corp., 12 N.Y.3d at 139; N.Y.C.P.L.R. (McKinney 2012). To the extent that either Fein or Nardi , Ferring's claims would have owed common law duties to begun to accrue with the leged breach, patent applicat in 2003. In addition, Ferring has not Sereni leged that Allergan l or Reprise had a relationship with Ferring that would 28 give se to any common law duties. Accordingly, for the reasons stated above, Counts 6 and 7 are dismissed as to all parties. D) Counts 8 And 9 (Aiding And Abetting) Are Dismissed To state a aim for aiding and abetting breach fiduciary duty under New York law, Ferring must allege "(I) a breach by a fiduciary of obligations to another, (2) that the defendant knowingly induced or participated in the breach, (3) that plaintiff suffered damage as a result of the breach." See Palmetto Partners, 83 A.D.3d at 808. Ferring has alleged that Allergan aided and abetted breaches of common law duties owed by Fein and Nardi by "requesting and/or accepting from [them] Ferring documents for use in activities adverse to Ferring's interest including in submissions to the District Court of The Hague." 212, (Compl. " 221). Ferring has not alleged that Allergan "knowingly induced or participated in" any breach. 83 A.D.3d at 808. See Palmetto Partners, Ferring has alleged only that Allergan, 29 through some sort of "due diligence," "either knew or should have known" of F e ' s and Nardi's employment histories and all duties allegedly arising therefrom, and that the documents submitted in The Hague Action were " idential, trade secret, proprietary, and privileged," and revealed Fein's and Nardi's status as former agents of Ferring. The harms (See Compl. ~~ 212, 221). leged from the aiding and abetting claims include Fein's "obta at least three patents" and defendants sharing "at least $43 million in payments from Allergan to date." (Compl. ~~ 213, 222). Neither of these harms have been adequately alleged to have anything to do with the document submissions to the District Court of Hague. Allergan's single alleged act of aiding and abetting relates to document submissions in The Hague. 212, 221). The alleged damages of the $43 million Allergan paid to Serenity and Reprise (Compl. ~~ See Compl. ~~ assignment of the patents in suit 215, 224), however, preceded The Hague submissions. In addition, the tort of ng and abetting breaches of common law duty does not encompass a "should have known" standard and actual knowledge is required. 30 See Kaufman v. Cohen, 307 A.D.2d 113, 125, 760 N.Y.S.2d 157 (1st Dep't 2003) (c im for aiding and abetting breach fiduciary duty was properly dismissed where there were "no facts In the complaint from which it could be inferred that the . defendants had actual knowledge" of any purported breach) . Ferring's recitals concerning Allergan's "knowing participation" in breaches are inadequate. Ferring has alleged that Allergan (i) SpecificallYI "request [ed] and/or accept[ed]" Ferring documents for use in The Hague action, and (ii) "knew or should have known [Fein's or Nardi's] employment history and consequently that [they owe] Ferring substantial common law duties." (Compl. ~~ 212, 221). not identify the "substant participation. This allegation does assistance" required for knowing See Kaufman, 760 N.Y.S.2d at 170. conceded that the allegations Ferring has Kaufman were "conclusory" (Pl. Opp. at 22), but cannot distinguish its own allegations from the inadequate language at issue (defendants "were aware Kaufman, 760 N.Y.S.2d at 169 Cohen's and plaintiff's prior involvement with and beneficial ownership interest ., and therefore knew of the fiduciary duty owed to plaintiffs by Cohen or acted in reckless disregard of the same."). 31 Ferring's allegations do not meet the applicable pleading standard. Ferring has offered no reason for Allergan to have known of any specific duties, contractual or implied, owed by either Fein or Nardi to Ferring. There is no allegation that Allergan saw or even knew of Nardi's Employment or Severance Agreements, or that Allergan had any actual knowledge whatsoever of the nature of Nardi's or Fein's relationships with Ferring - relationships that concluded approximately eight years prior to the assignment of the patents to Allergan. Without an allegation of actual knowledge on the part of Allergan of the alleged common law duties, Counts 8 and 9 are dismissed as against Allergan. The aiding and abetting claims are also untimely. The applicable limitations period for an aiding and abetting claim is the same as for the underlying violation, which in this case is an alleged breach of fiduciary duties. Stevenson, No. 08-cv-8960 (S.D.N.Y. Feb. 6, 2009) See Glonti v. (CM), 2009 WL 311293, at **6, 13 (dismissing as time-barred, pursuant to Rule 12(b) (6), claims including breach of fiduciary duties and aiding and abetting breach of fiduciary duties). Because Ferring's claims for breach of fiduciary duties carry six-year limitations periods and are themselves time-barred, Ferring's 32 infirm on timeliness aiding and abetting claims are simil grounds and there dismis E) Counts 10 And 11 (Breach Of Contract) Are Dismissed Breach of contract under New York law requires: the stence of an agreement; contact by plaintiff; (4) damages. 1996). (1) (2) adequate performance of (3) breach of contract by defendant; and Harsco ----------~~------~-- 1 91 F.3d 337 1 348 (2d Cir. Ferring/s claims for breach of contract involve allegations arising from Nardi/s Employment Agreement Severance Agreement. ~~ 228 (See Compl. alleged that Nardi breached 1 245). his Ferring s Employment and Severance Agreements by (a) using Ferring confidential information to design and conduct clinical studies and obtain and commerc patents covering desmopressin formulat 1 ize and (b) providing Ferring confidential information to the other defendants as part of 35 discovery process in The Hague Action. 1 (See id. ~~ 234 250-51.) There are no allegations of a contractual relationship with any of the other Defendants. demonstrating that Fein l Allergan Ferring has not pled facts l 33 Reprise or Serenity had a contractual relationship with Ferring or that any breaches of contract were committed. Accordingly, Ferring's claims for breach of contract are dismissed as against these parties for improper pleading. See Swan Media Inc. v. Staub, No. 11 civ-2250 (RWS) , 2012 WL 160073, at *3-4 (S.D.N.Y. Jan. 18, 2012) (dismissing breach of contract claim for failure to properly plead the existence of an enforceable contract) . breach of contract claims are also time-barred. To the extent Nardi breached any contract by using Ferring information to develop desmopressin products or assist in obtaining patents, those breaches accrued no later than 2003, when Fe first pursued his patent applications independently. The six-year statute run. limitations for breach of contract has See Marvel, 756 F. Supp. 2d at 470 not be aware ("The plaintiff need the breach or wrong to start the [limitations] period running.") (citation omitted). Ferring's breach of contract claims against Nardi are thus time-barred and dismissed. F) Count 12 (Interference With Contractual Relations) Is Dismissed 34 A tortious interference with contractual relations claim under New York law requires a plaintiff to prove: (1) the existence of a valid contract between itself and a third party; (2) the defendant's knowledge of the contract; (3) the fendant's intentional procurement of the third-party's breach of the contracti and (4) damages. v. Lefkowitz, 16 F. Supp. 2d 355, 359 (S.D.N.Y. 1998) omitted). Ltd. See Mina Inv. HoI (citations Further, to sustain a claim for tortious interference with a prospective contract with a third party, a plaintiff must demonstrate that (1) but for the actions contract would have been formed and (2) contract from being executed, the the defendant, the in preventing the fendant intended to "damage the plaintiff U or engaged in "dishonest, unfair or otherwise improper" conduct. Bankers Trust Co. v. Bernstein, 169 A.D.2d 400, 401, 563 N.Y.S.2d 821 (N.Y.App. Div. 1st Dep't 1991). Ferring's legation with respect to Allergan's alleged involvement in purported breaches is that "U.S. and European counsel for Fein, Allergan, Serenity, and Reprise approached Nardi for assistance" in The Hague Action, and then submitted evidence allegedly containing Ferring confident information to the strict Court of The Hague. 267) . 35 See Compl. ~ Fatally, Ferring fails to plead a requisite element of a claim for intentional interference with contractual relations, namely, that Allergan intended to induce any contractual breaches. See Jones v. Sch. Dist. Of New Rochelle, 695 F. Supp. 2d 136, 148 (S.D.N.Y. 2010) (stating that intentional inducement is a necessary element of the claim). There is no allegation that Allergan intended to cause contractual breaches. Count 12 also should be dismissed as against all other fendants because Ferring fails to plead any pecuniary damages resulting from alleged inducements of breach, as required by New York law. See Int'l Minerals & Resources F.3d 586, 595-97 (2d r. 1996). , 96 Ferring alleges only that defendants' evidentiary submissions in The Hague were "adverse to Ferring!s interest," but does not plead any actual damages See Compl. ~ 267.) resulting therefrom. Indeed, the only reference to damages is the $43 million paid by Allergan for the assignment of the patents in-suit, which assignment occurred in 2010 (see id. ~ 106) I almost two years before the breach Allergan allegedly induced. 36 helping Fein develop Ferring also has alleged desmopressin formulations and obtain breach (see id. ~~ 266{ 270). limitations In New York{ the statute intentional interference with contractual relations is 2012). s were inducements of years. See N.Y.C.P.L.R. 214(4) A claim accrues "at the t (McKinney the injury is sustained. u Rosemeier v. Scb:enker Int'l{ Inc.{ 895 F. Supp. 65{ 66 (S.D.N.Y. 1995). Because the injury allegedly suffered by as a result of assistance in developing and obtaining desmopressin patents occurred in 2003{ when alleged contractual interference caused Fein to file his patent applications{ Ferring{s aims are untimely and therefore dismis G) Count 13 (Misappropriation of Trade Secrets) Is Dismissed To state a misappropriation claim, that "(1) it possessed a using trade secret or duty, or as a result Geritrex secret{ and (2) Ferring fendants are breach of an agreement, confidence { scovery by improper means. v. Dermarite Indus. (S.D.N.Y. 1996). must allege U LLC, 910 F. Supp. 955, 961 not alleged that Allergan is using that information in breach of any agreement, confidence, or duty. 37 ng's misappropriation claim is based on Compl. ~~ evidentiary submissions to a foreign tribunal. 277 78). Because Ferring has conceded that Allergan did not submit the documents breach of its own "agreement, confidential relationship, or duty" "analysis . (Pl. Opp. at 23), the turns on whether [Ferring] sufficiently pleaded that [Allergan] used [ ng's] trade secrets as a 'result of discovery by improper means.'" See Watts v. Jackson Hewitt Tax Servs., Inc., 675 F. Supp. 2d 274, 280 (E.D.N.Y. 2009). In Watts, as here, a party obtained allegedly confidential materials from t claimant's former employees and then submitted them during discovery in an action involving the aimant. Id. at 277-78. The Court found that "[d]iscovery by improper means" does not include purported "abuses of the civil discovery process. II Id. Ferring fails to distinguish Watts from the instant case. In addition, even if there were such a relationship between Allergan and Ferring, Allergan's use that information, accepting and submitting documents in The Hague Action, does not constitute misappropriation. 38 (See Compl. ~~ 277-78.) The mere submission of documents as part of the discovery process does not constitute misappropriation. See Watts, 675 F. Supp. 2d at 280 ("'Discovery by improper means" refers not to abuses of the c to industrial espionage.") 1 discovery process, but rather (citation omitted). Even if Allergan somehow improperly induced Fein or Nardi to provide it with Ferring trade secrets, "mere conclusory statements that they did so pursuant to . . underhanded prodding fails to raise this allegation 'above the speculative level.' II See id. (citing Twombly, 550 U.S. at 555). Count 13 should also be smissed because the limitations period for a misappropriation claim has ready run. In New York, misappropriation claims must be brought within three years of "when the defendant scloses the trade secret or when he first makes use of plaintiff's ideas." I v. Alcon Laboratories WL 2016872, at *2 Inc., No. 08 Civ. 3669 (DLC) , 2009 (S.D.N.Y. July 9, 2009) see also N.Y.C.P.L.R. 214(4) tcs USA (quotation omitted) (McKinney 2012). Ferring has alleged that Fein and Nardi first misappropriated Ferring's "labor, skill, and expenditures, as well as its confidenti trade secret, proprietary, and privileged information" by collaborating with Serenity and Reprise to obtain and 39 i commercialize patents covering desmopressin formulations and designing and conducting clinical studies. 295.) The three- ar limitations period began in 2003, when Fein first applied for patents covering formulations. (See Compl. ~~ 280, smopressin Accordingly, for the reasons stated above, Count 14 is dismissed. H) Count 15 (Conversion) Is Dismissed The tort of conversion requires that the defendant, "intentionally and without authority, assumes or exercises control over personal property belonging to someone else." Marketxt Holdings Corp. v. Engel & Reiman, P.C., 693 F. Supp. 2d 387, 395 (S.D.N.Y. 2010). Ferring has not alleged any facts demonstrating that Allergan intentionally exercised control over Ferring property. Count 15 is also time-barred. Conversion claims are subject to a three-year statute of limitations, which begins running when the N.Y.C.P.L.R. 214(3) leged conversion takes place. See (McKinney 2012) i see also -----------,----------- Records, 58 N.Y.2d 482, 488-89 (1983) (barring conversion claim because statute of limitations had run). 40 Ferring has contended that the conversion claims did not accrue until "Ferring's demands and Defendants' refusals in early 2012." However, the case Ferring has cited, accrual based on demand and refusal applies where "the party in possession has not acquired possession wrongfully, and has not otherwise exercised wrongful dominion over the property." Bolton, 757 F. Supp.2d at 179. The later accrual period therefore applies only if defendants' alleged acquis were lawful. ion of the Ferring documents and patents in-suit However, Ferring has pled that the acquisition was unlawful (see, e.g., Compl. ~~ 190, 202, 237). To the extent that Fein and Nardi are alleged to have exercised control over any information belonging to Ferring, the conversion took place in 2002, by retaining documents after completing the employment and/or consultancies. see id. ~ If, as Ferring has alleged 310), any defendant used unlawfully obtained Ferring material to develop desmopressin formulations or obtain patents, the defendant must have had that material prior to 2003, when Fein first filed s patent applications. Count 15 is therefore time-barred. I) Count 16 (Fraudulent Concealment) Is Dismissed 41 "Fraudulent concealment is a species of common law fraud. Arabe Et Internationale D'Investissement v. II r.1995). Maryland Nat'l Bank, 57 F.3d 146, 150 (2d "Under New York law, fraudulent concealment requires proof of: failure to discharge a duty to disclose; defraud, or scienter; Cir. 2005). (2) intention to (3) reliance; and (4) damages." =-:R-=e-=c-=o-=r:.....:d:::.=s=--v~.--=.I.=s-=l:..::a=n=-:d=-...;D=-e.=...=.f.-.:;...J=a_m--"M=-u=s --i=-c--"----'--'--"-, ¢= (1) TVT 412 F. 3 d 82, 90- 91 (2 d The duty to disclose requires a fiduciary relationship between plaintiff and defendant. See v. Green, 42 A.D.3d 521, 522, 842 N.Y.S.2d 445 (2d Dep't 2007). Misrepresentations or omissions must be pleaded with specificity or the claims will be dismissed. See e . . , Ben Hur Inc. v. Better Bus. Bureau, No. 08 Civ. 6572, 2008 WL 4702458, at *4 (S.D.N.Y. Oct. 3, 2008) ("The plaintiff's complaint fails [the Rule 9(b)] standard because the allegations in the complaint do not specify the time, ace, [or] speaker . of the misrepresentations that were allegedly made . . ") i Armored LLC v. Homeland Securi , No. 07 CV-9694 (LAP) , 2009 WL 1110783, at *1 (S.D.N.Y. 2009) (dismissing a fraudulent inducement claim where plaintiff "does not identi the location where the misrepresentations were made not provide exact dates for the statements . 42 . does . and fails to sufficiently identify 'who' the speaker is concerning each statement") . In addition, "[i]t is well settled that a complaint leging fraud under New York law must comply with the heightened pleading standard under Rule 9(b) which requires that - L ~ Woods_ _v. _ _ _ ___ __ ~ particularity.'" ~ 'the circumstances constituting fraud . . must be stated with Co., No. 10 Civ. _ __ 0559 (ADS) (WDW) , 2010 WL 4314313 at *5 (E.D.N.Y. Nov. 2, 2010) (quoting Fed. R. Civ. P. 9(b» i see also Ganino v. Citizens Utils. Co., 228 F.3d 154, 168 (2d Cir. 2000). Ferring has contended that it is not required to plead fraudulent intent with particularity, relying on Rule 9(b)'s provision that "[m]alice, intent, knowledge and other conditions a person's mind may alleged generally. II But" relaxation of Rule 9(b) 's specificity requirement for scienter 'must not be mistaken for license to base claims of fraud on speculation and conclusory all ions'll. Shields v. rust Bancorp, Inc., 25 F.3d 1124, 1128 (2d cir. 1994), quoting O'Brien v. National ts Partners, 936 F.2d 674, --------------------------~--~----~~------------- 676 (2d r. 1991). Instead, "to serve the purposes of Rule 43 9 (b), [the Second Circuit] require [s] plaintiffs to allege facts that give se to a strong inference of fraudulent intent." Id. "[W]hen pleading scienter, plaintiffs must allege facts that give rise to a strong inference of fraudulent intent." Woods, 2010 WL 4314313, at *6. Furthermore, "basing allegations of knowledge and fraudulent intent 'upon information and belief' without anything more will not satisfy the pleading requirements under Rule 9(b)." Mortgage Corp. v. Equifax, 2009) Id. at *7 (citing Premium Inc., 583 F.3d 103, 108 (2d Cir. ("Allegations that are conclusory or unsupported by factual assertions are insufficient.")) F.2d 49, 54 n. 1 (2d Cir. 1986) ordinarily i Luce v. Edelstein, 802 ("Allegations fraud cannot based 'upon information and belief,' except as to 'matters peculiarly within the opposing party's knowledge. '") . Ferring has failed to plead with the requisite specificity the misrepresentations or omissions that form the basis of Ferring's fraudulent concealment claim. "The particularity requirement of Rule 9(b) demands that a plaintiff '(1) detail the statements (or omissions) that the plaintiff contends are fraudulent, (2) identify the speaker, (3) state where and when the statements (or omissions) were made, and (4) 44 explain why the statements (or omissions) are fraudulent. '11 Woods, 2010 WL 4314313 at *5 (quoting F.3d 337, 347 (2d Cir. 1996)) Ferring has alleged Fein's and Nardi/s intent "on information and belief ll (See Compl. ~ 325) ("On information and belief, the actions of Fe and Nardi have been at all times knowing, willful, and malicious.")) and without more, thereby fails to allege fraudulent intent with particularity. There are also no facts alleged that Allergan intentionally or even knowingly defrauded Ferring. See Saltz v. rst Frontier, LP, 782 F. Supp.2d 61, 75 (S.D.N.Y. 2010) (dismissing fraudulent concealment claim for failure to plead scienter) . Here, Ferring has alleged that Fein and Nardi made misrepresentations to Ferring or had a duty to disclose led to disclose facts they see Compl. ~~ 318 323), but has not identified when, where, or how these or omissions occurred. See Compl. leged misrepresentations ~ 318) leging that "Fein has repeatedly assured Ferring that he would use no Ferring confidential, trade secret, proprietary or privileged information" without specifying when such assurances were given or to whom) . 45 'ii: __ c u _ In addition, Ferring has not alleged that it relied on any specific misrepresentation or omission by either Nardi or Fein or that such leged reliance is reasonable or justifiable. See, e.g., Kramer v. Schloss, 2004 U.S. Dist. LEXIS 30964, at *24 (N.D.N.Y Nov. 30, 2004). ("In order to prove the reliance element of a fraudulent concealment claim, a plaintiff is required to demonstrate that the alleged misrepresentation or omission induced him to act or to refrain from acting to his detriment The reliance must also be reasonable or justifiable. H); Waksman v. Cohen, 00 Civ. 9005 (WK), 2002 U.S. Dist. LEXIS 21209, at *18 (S.D.N.Y. Nov. 4, 2002) ("As a result, in order to maintain a claim for fraudulent concealment, the aintiff must establish that disclosure or lack thereof.'H 'actual (quoting Banque Arabe Et Internationale D'Investissement v. 146, 156 (2d Cir. 1995)). relied on the and Nat!l Bank, 57 F.3d Ferring's allegations as to Fein and Nardi is that their acts "prevented Ferring from discovering their claims set forth in this complaint. H (Compl. ~ 321). As to the other defendants, Ferring has not alleged a fiduciary relationship between Serenity and Reprise or any duty of Serenity and Reprise to Ferring. 46 Count 16 does not lege that Serenity and Reprise acted with intent to defraud. Taken as to those parties. together, Count 16 is therefore dismi J) Count 17 (Unjust Enrichment) Is Dismissed To state a claim for unjust enrichment in New York, a plaintiff must allege that: (1) the fendant was enrichedi (2) the enrichment was at plaintiff!s expensej and (3) the circumstances were such that equity and good conscience require defendant to make restitution. Intellectual tal Partner v. ---------~------~------------------ Institutional Credit Partners LLC, No. 08 Civ. 10580, 2009 WL 1974392, at *8 (S.D.N.Y. Jul. 8, 2009). need not be Although a plaintiff privity with the defendant to state a claim for unjust enrichment," there can be no claim where between plaintiff and connection fendant is attenuated. v. Crompton Corp., 8 N.Y.3d 204, 215-16, 831 N.Y.S.2d 760 (dismissing unjust enrichment c direct relationship) i see also im because parties lacked ~O'~Y~ia Malone & Co. Ralph Rieder, 86 A.D.3d 406, 408, 926 N.Y.S.2d 494 2011) (2007) Inc. v. (1 st Dep't (unj ust enrichment claim requires "a connection or ionship between the parties that could have caused reliance or inducement on the plaintiff's part"). 47 leged that the Defendants have been Ferring has unjustly enriched by using Ferring confidential information in "patenting, developing, and/or commercializing certain desmopressin formulations." has not alleged a (Compl. ~ 330). ationship between Allergan and Ferring to support a claim for unjust enrichment. fail However, Ferring Ferring has furthermore to plead the requisite relationship or connection between Ferring and Serenity or Reprise. Ferring's unjust enrichment claim is also time-barred. The limitations period for unjust enrichment claims is six years, and it starts running when the defendant commits the wrongful act that enriches him. See Cohen v. Cohen, 773 F. Supp.2d 373, 397 (S.D.N.Y. 2011) (dismissing unjust enrichment claim as t -barred). To the extent any defendants committed a wrongful act that led to "patenting, developing, and/or commercializing certain desmopressin formulations," that act would necessarily have occurred no later than 2003 when Fein first applied for patents covering those formulations. Accordingly, the claim for unjust enrichment comes well after the s year limitations period has run and is therefore dismissed against 1 Defendants. 48 III. Conclusion Based upon the facts and conclusions set forth above, the Defendant's motion to dismiss is granted as to all counts, except for Counts 1 through 3. It is so ordered. New York., NY March! t~, 2013 / / ROBERT W. SWEET U.S.D.J. 49
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