only do i not object to the motion that's been made but in this particular instance having also had the privilege to work with steve and to have him work very closely with with me and with my chambers i second the motion wholeheartedly  steve it's been a pleasure to have a part of our chambers family and we intend to adopt him going forward i enjoy the fact that his brain works much like mine and especially from the standpoint of having a strong hold on economics and that part of the approach to the law so i second the motion and i welcome him to the bar thank you is there any further comments any objections from the audience a finding of invalidity that this court reversed what happened as part of that was a situation that triggered a settlement contract in our impacted entered as part of that underlying litigation so what we hear about today do is we are asking to lot but the record what we've talked about in the record is there are two agreements here a settlement agreement and there's also a separate agreement with your rand who i don't believe is represented counsel table today but that's an the product that you already have on hand no your honor this would be both the product we have on hand and going for we believe and plaintiffs have agreed of three point two c applied that was a permanent trigger power right to sell and how do you even if that were the case even if there were a case that at three point two three apply to you how do you get around the fact that that you're in and that's the are themselves enjoined from authorizing any additional staff they couldn't transfer anything more to you even if your contract told them to the plaintiffs were the ones who asked for that injunction if the plaintiff no longer seek the injunction would be dissolved engines the plaintiff sought the injunction to keep mine went off the market and as part of that plan to read to pull themselves back at that time through watson but if plaintiffs if the settlement agreement gives us the right to go injunction that's applied to impacts the right is whether there's a likelihood of success and under this contract we don't believe there is a likely i question something though of the more plymouth area than that and that's for that we even address modification of the injunction you know you're arguing you were not covered by the the initial injunction your honor we certainly do not believe that we were covered by the march injunction we were in a party at that time this court's decision additives specifically say that a party that's not present before the court the court doesn't have jurisdiction to enter an injunction against that when that injunction included everybody that's an active concert with some of the names already you are i think additives addresses that point there is an issue about whether a person whether impacts would be a party to that injunction as opposed to whether the activities that they might conduct would have been in contempt of that injunction but added this makes very clear that that injunction did not apply to impacts it was not a party at the time but even if that were the case twelve ninety two specifically says that you can address modifications or refusals to dissolve the injunction that was addressed by the district court here as well as a final decision on the  view it as a clarification then you have to say that impacts was a party to that earlier jump and i don't believe this court can do that if it follows the additive case law first secondly regardless of whether or not that injunction is specifically before the court there was a final judgment here reached with regard to the settlement agreement the court specifically addressed that that's also addressed on duerson external grounds of twelve ninety one and twelve ninety five this was a patent case the settlement agreement that rose out of a pack case and it's a viable order as well with respect to the injunction doe i understand that your argument is that it was not a clarification post because you were covered by the original agreement and because you believe there were some change of circumstances in the interim well certainly what we believe happen we don't believe it was a clarification because it was a part of the injunction to begin with and so the question of clarification relates back to what the injunction said at that time back and i believe it was may of two thousand to eleven but the issue was we modification based on the settlement agreement fact the court did not have in front of it and of the settlement agreement applies we have the right to go to mark and should not i but if you were covered by the initial agreement then you you can't see current and modification unless there's some change of circumstance that would cation correct i don't believe i agree with that first off well if you assume that we were covered under the age lynch option then this court may be correct that the jurisdiction with regard to that particular aspect of this case may be a issue and that would require we pan to the district court to decide but this court also has in front of it the construction of the settlement so that was a final decision and it's your position that there is a decision that this court c that because i know a lot been made of that and a lot was made about whether impact participated but for the court below i would point out and this is on the record at twelve forty four twelve forty five as well as with regard to impacts notice whether this court ha previously the validity question but those claims as you may recall they were there was one independent claim each patents they were very specific claims those weren't those parts of the claims were not at issue with this court but specifically as relates to impact the we will first off if we didn't choose not to try that that's i believe not reflected in the record the court had bifurcated the infringement case so it was not a question of whether or not there was going to be a trial on infringement impacts a band or not there was going to be a trial it did not go willow look at the circumstances surrounding watches as whether it's a the to me it really comes down to whether we're dealing with the show's agent or a classic distributor and distributor being the company that takes possession of the goods in the cho name keeps inventory markets under charlie it keeps the profits of that marketing  don't see that that's what chat that that's what happened in this space i understand what your are saying i believe but if we look at the specific language of three point two c which is the relevant section that section require several of which are defined term some of which are undefined and delaware law applies this contract this is an overview the specific claim the specific terms that are defined in the contract relate to third party and perhaps are owners question addresses the question as to whether or not a sales agent is true we have a third party with regard to this because i believe we look at the authorized to begin selling language an agent is clearly authorized a sells agent clearly begin selling so to me that part almost defines itself if a sales agent has been authorized to sell i don't know what they're authorized to do but the term third party is very specifically defined here and specifically if you read the contract excludes agents third parties defined as anybody other than your ran a nesta and impact affiliates is also a defined term in this contract under one point one affiliate requires that you have management control or that you own more than fifty percent of the other party and with regard to that particular point there's no dispute that they had management control wasn't why didn't they also there's also no dispute that they own fifty percent of what they did we also know that the fact that agents was left out other parts of this agreement specifically to point to him two point three when we get to the releases talk about a nest and impacts again defined term and released with regard to nest and its agents impacting estate agents are not included as third parties in this contract and with regard to delaware law  defined term has to be construed with regard to the contract here the contract specifically does not permit an agent to be a non third party if they are a third party they are authorized to sell even if only a sales agent and we would submit clearly they sold authorizing our product if you look at the watson agreement which we don't even think is necessary one point two zero which talks about a definition of on behalf of an estimate three point two doesn't say that you have to sell on your own behalf so our view is if you thought that you had the right to to sell this product that was delivered to you in detailed requirements as to what you have to do prior to any sales or in connection with anything else including an obligations that you have to sacrifice all within thirty days of what you believe to be the effective date  paragraph four had to do with the with within thirty days you have to provide of the of the effective date you have to provide the represents a better there's a lot of obligations and i don't see anything that indicates that any of those obligations or fulfill your own and there's clearly nothing on the record with agree and some sense is that the benefit is to go when other generics come on the market now the question is and i think their argument actually goes too far taken to its logical explains their argument is it's really a question as to whether t it gives a head start over the other generic no the at the intent would be the intent at the time agreement was signed when there was nobody on the market was that at the time other parties went on the market he would be entitled to do so under the specific provisions on a three point too their argument has to equate to the fact that even if they were still selling with watson now basically along with the sales agent agreement we would be able to come on the market if they were selling with watson now i clearly don't think that's what our client or any generic client would have negotiated the idea was if a generic came on the market we'd be entitled to do so there was an at risk watch here so that was one of the benefits as a new you were able to  r what i can tell you is we ordered the product prior to the injunction being entered as i understand it the product was delivered i don't believe impacted anything else at that time we have the product clearly we haven't we haven't done the commercial sell so it's not i would have to i'd have to refer back to that your honor i don't recall that but i think the point that i would make on that is regardless of what this court does and what the injunction i don't think there's been a dispute from this point in from the plane at the least not that at the very minimum again your honor i think and this address with the point about whether additive controls or not but but that's language obviously comes from the rules themselves and what that really applies to as i understand it is which parties might be in contempt but it doesn't subject the party that no longer before the jurisdiction of the court to actually being a party to the injunction so here counsel said if a sales agent isn't authorized to sell i don't know what they are off to do the the way we determine what the scope of an agency is we look at the agreement between the agent if you will and the principal and it is absolutely clear from the sales agent agreement that watson could not tell the product that was the whole point of the sales agent agreement watson's authority was to solicit orders on behalf of a nest and there are multiple provisions in the agreement that relate to the issue that watson was not selling how do you respond to the posing counsel's argument said that well clearly that was an ad attempt to make sure you didn't fall within the words cell within the in the settlement agreement the settlement agreement doesn't define sell it in any particular term aren't immediate you know when i think of when i when i go in and some kid is telling me a cellphone i think he's selling even though i know he doesn't personally have the right to would view it under the delaware statutes and under the delaware frankly the delaware dictionary definitions and we've all gone to black's law dictionary and other sources and we've gone to the u c c as well and each of those circumstances define a sale as the passing of a title from one person to another or price and that's why in essence what you have in the contract between watson and a mess that is not that circumstance well let me this is actually a two part the first i just want to clarify that counsel's last point that he made which is that that your motion to dismiss as it relates to the injunction was only a partial motion that is correct i mean if you concede there's serious action over the substantive ruling as it relates to with yes we do if there is a declaratory judgment settlement contract and we agree i don't agree with what's been stated about the injunction but i do agree that there is jurisdiction to dispute to determine whether or not have a of title it's a little bit unclear but i got it so i'm asking the question so what you see in her ruling in the court's ruling is both of those or to describing intent right you talks about the general intent of the parties and then she also talks about of the court also talks about the language of three point two see that it does not encompass plaintiff's own action to sell its own product whether it with the assistance of a sales agent or any other intermediary and that's a typical if all parties have agreed sort of a typical way that branded companies would sell their own authorized generic is to seek assistance and help from another company that doesn't have the watson it could be the caisson it could be wal mart i mean it's it's almost that w because it's watson to become some kind of over out there with another generic no we're using the services of watson in that particular field to accomplish sales of our own and watson was required to tell people that these were you sales they were prohibited from selling the product as the declarant for your brand said because they didn't want any competition with their how do you know i mean every state is different how does delaware law treat the issue of inten partners we look at the objective view of what the language means if there is an ambiguity then we go to parole evidence but you are supposed to under the supreme court for is look at the contract construe the term in this case fell according to the objective third party view if present in the queue is in what that term self might mean or what the terms authorized or a license might mean then we do go to parole and that's why  we don't believe it isn't that us i mean the parties definitions of cell that the definition of selling to deliver are uniform in terms of the passage of title and whatever license or authority we had to give to that third party they had to be able to sell the product it is just that simple and that is how your ranch ruptured its arrangements and you know let's remember the purpose and that judge roberts and the just the district or excuse me focus and the idea behind three point two c really is a most favored nation i heard that they sort of agree with that it wasn't quite clear as to how far removed goes but the idea behind it is to give impact the benefit of some other parties better negotiating skills if in fact there were another impacts out there right who we start with or reached an agreement with that got a better entry date that's the whole point of this is that they got out of the case we all got out of the case they get the benefit of someone superior negotiating skills who might have had substantially more leverage to extract a concession from plaintiffs and then stand apart right now partners before the district court they forty five days from mandate in the prior decision pending further order of this court or the district court in the district court is considering what to do with the injunction so par is there and milan is there at the district court as well reconsider if you will what it means have a more fulsome record determining what the terms of the contract mean and of course it would be remanded works this remanded for some fact finding but that injunction that preliminary injunction in our view the the ability to appeal that has been long since passed that injunction was entered in may and as articulated how do you see the application of additive with respect to that and so to it and in that circumstance i think the that the injunction applies to the non parties in an active concert that's the statement of the law that and you know those parties who are in active concerts how you can be held in contempt of injunction that you have notice of and not be a party to it is i don't i don't see that distinction as being a real distinction and let's be clear these parties were in active concert they had we were their sole supplier for this product that's how they had invested as we described in their brief very very well you need to get in and approve is not a it's not a trivial thing you know we it's not nearly the what we like to describe as the heroic effort of the brand but it's not nearly  brand it's not a small thing regulatory filings cost money producing your own product costs money right all that all the sort of the circumstances around that are things that the company has to do and has to devote of those occur to my knowledge none of them actually occurred and that goes to the the conduct point you made which is this dispute i don't i mean i can't speak to why the roads all i can say but no of course the contract is the if the is a is the obstacle to the entering the market the contract has not been triggered that is the point and that is the point i think you missed the to you know your plaintiff doing anything and the district court entered the injunction as a status quo injunction to preserve the status quo and in the appeals which are still going forward with my alliance petition for certiorari that was the and well and i think that's correct if in fact the contract is not a barrier for them to launch then the injunction is the only thing stopping them from launching but as i heard it said we agree that that somehow there's no further determination of these matters on appeal it's just a matter of actually putting that agreement on pieces of paper the parties have exchanged we exchange with milan par and impacts drafts of extensions of the ports pulmonary injunction discuss just one last point that goes to that goes to conduct and again estimate hearing impacts was there according to them their right to be on the market had been triggered at the time of the may hearing injunction they said not a word it wasn't a circumstance of a nonparty not being there they were there they appeared and and listened and sat at counsel table for their hearing they then got product not dispute that you're just i don't know that i don't remember that from the record of course if someone said something i would not dispute that mylan certainly is the one that made the clarification we of course argued at a hearing that impacts had no right to be on the market  response to two mile and a comma and so really at the end of the day the construction of the contract is consistent under delaware a lot with what my clients did with watson and impacts us conduct over the course of seven months shows that the parties were at a mutual understanding i don't know why the issue arose but in my experience any company that can make eight million dollars a month which is what they said they could have made from august through november any company that could do that would and would comply with the provisions that your honor called out of the contract to make that eight million dollars a month that's twenty five million dollars that they could have made according to them and there was according to them they weren't in joint and they had a right to launch on the contract counselor so they weren't ready there's nothing in the record at every opportunity to come to the district court and put those kinds of things in the record no record was made on that at all  to be very brief if i may there was a comment made that watson would be the same as wal mart or other parties under this agreement that's a position that's never been taken but i would say that that's completely inconsistent with the agreement if you look at the definition of authorized generic which is what we're talking about being sold under three point two c it talks about being sold into the retail chain of trade so what we're talking about is somebody like a watson selling into that chain so the fact that a distributor a distributor or a wholesaler and the retail train a chain of trade is not equivalent to watson in this agreement i don't i don't believe that that's been reflected in this record with regard to the antenna question judge o'malley asked one point i would like to make there your honor is if you look at the delaware cases lorillard in rome that have been cited specifically what you're looking at is you're not actually looking at the specific intent of the parties but the courts don't care about that what they ask is actually a hypothetical what would a reasonable person of thought in this instance and here we would go back to what impact was bargaining for to answer your honor's point judge raina what impact is bargaining for was the right to be on the market when other generics were on the market they weren't permitted to do that during the last risk launch period they didn't have product but there's also no question that three point two c is a permanent trigger three point two c had nothing to do with an at risk launch it doesn't have that requirement to pull back so if three point two c is triggered we have the right to go now and their position would be even if they were still on the market with watson today impacts bargained away the right to be on the market with another generic because they're the cells agency i think no reasonable person in a generics position would bargain to wait that