UNITED STATES DISTRICT COURT

DISTRICT OF NEW JERSEY

HELSINN HEALTHCARE S.A. and :

ROCHE PALO ALTO LLC, : Civil Action No. 11-3962 (MLC)

: (consolidated)

Plaintiffs, :

:

v. :

:

DR. REDDY’S LABORATORIES : OPINION AND ORDER

LTD, et al., :

:

Defendants. :

___________________________________ :

This matter comes before the Court on separate Motions to Amend Invalidity Contentions 

by Defendants Sandoz Inc. (“Sandoz”), Teva Pharmaceuticals USA, Inc. and Teva 

Pharmaceutical Industries Ltd. (collectively, “Teva”), and Dr. Reddy’s Laboratories, Ltd. and Dr. 

Reddy’s Laboratories, Inc. (collectively, “DRL”) (collectively, “Defendants”) [dkt. nos. 119, 120, 

124]. Plaintiffs Helsinn Healthcare S.A. (“Helsinn”) and Roche Palo Alto LLC (“Roche”) 

(collectively, “Plaintiffs”) opposed the Motions [dkt. no. 130]. The Court has considered the 

Parties’ submissions pursuant to FED. R. CIV. P. 78 and, for the reasons set forth below, 

Defendants’ Motions are GRANTED, in part, and DENIED, in part.

I. BACKGROUND

Plaintiffs sued Defendants for infringement of two patents relating to liquid formulations 

of palonosetron on July 8, 2011. Plaintiffs filed suit on a third patent on September 23, 2011. 

Collectively, the patents relate to Plaintiffs’ Aloxi ® product (“Aloxi” or “the accused product”). 

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The facts relevant to the instant Motions are as follows. Pursuant to the Court’s 

December 2, 2011 Scheduling Order [dkt. no. 75]

1

, Defendants served their initial Invalidity 

Contentions on December 1, 2011. Prior to serving its initial Invalidity Contentions or 

conducting any discovery, Sandoz also provided Plaintiffs with notice of an on-sale bar defense 

relating to a transaction with a company called Oread Laboratories, Inc. (“Oread”) that appeared 

in the public prosecution history for the patents-in-suit. After receiving that notice, Plaintiffs and 

Sandoz engaged in settlement discussions, which continued through Summer 2012.

The Parties completed claim construction briefing and U.S. District Judge Mary L. 

Cooper conducted a Markman hearing on September 7, 2012. Judge Cooper has reserved claim 

construction rulings until trial. See dkt. nos. 103, 104. 

Between January 2012 and November 2012, the Parties exchanged a substantial number 

of documents to meet the discovery deadlines in this case. In September 2012, it became clear 

that the settlement discussions between Plaintiffs and Sandoz would not resolve the matter. 

Therefore, pursuant to a stipulation between Plaintiffs and Sandoz, the Court permitted Sandoz 

to (a) amend its contentions to assert the “on-sale” defense; and (b) conduct discovery relating to 

those newly added defenses. See dkt. no. 102 (September 12, 2012 Stipulation and Order) (the 

“September 12 Order”).

Pursuant to the Court’s September 12 Order, Sandoz served its First Amended Invalidity 

Contentions on September 25, 2012. Sandoz alleged, based on documents submitted by the 

patentees during prosecution of the patents-in-suit, that the claimed invention was “ready for 

patenting” by March 24, 1999, and that Helsinn appeared to have purchased a substantial 

 

1

The December 2, 2011 Scheduling Order memorialized dates by which Defendants were 

required to serve their Invalidity Contentions based on the Parties’ previously approved Joint 

Discovery Plan. 

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quantity of palonosetron from a third party supplier, Oread, under circumstances that constituted

a commercial sale or offer for sale. Sandoz’s Br. at 4 (citing First Amended Invalidity 

Contentions).

On December 27, 2012, the Court granted pro hac vice motions admitting counsel from 

the law firm of Morrison & Foerster, who thereafter became co-lead counsel for Sandoz, along 

with Cozen O’Connor and Hill Wallack LLP. On January 7, 2013, Hui Liu, Esq., of Morrison & 

Foerster began reviewing Plaintiffs’ document production. One of Ms. Liu’s primary objectives

was to identify Plaintiffs’ internal documents that related to Sandoz’s on-sale bar defense. 

Through her review, Ms. Liu identified a number of Plaintiffs’ internal documents that provided 

additional and stronger support for Sandoz’s on-sale bar defense. In addition, according to 

Sandoz, in December 2012, Plaintiffs substantially changed the identities of the named inventors 

in this action indicating a potentially invalidating defect in their inventorship claims. Sandoz 

claims this fact, coupled with its review of certain of Plaintiffs’ documents, support its new 

inventorship defense. 

On January 16, 2013, Sandoz notified Plaintiffs of its intention to move to amend its 

invalidity contentions based on counsel’s review of Plaintiffs’ document production. The Court 

held a status conference with the Parties on January 17, 2013. At that time, DRL and Teva also 

informed the Court of their intention to move to amend their Invalidity Contentions. 2The 

Defendants unsuccessfully attempted to obtain Plaintiffs’ consent to amend their Invalidity 

Contentions. Thereafter, pursuant to a briefing schedule set by the Court, Defendants filed the 

instant Motions on February 15, 2013. 

 

2

It is unclear when either DRL or Teva first notified Plaintiffs of their respective intentions to 

move to amend their Invalidity Contentions. 

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II. LEGAL STANDARD

The District’s Local Patent Rules “exist to further the goal of full, timely discovery and 

provide all parties with adequate notice and information with which to litigate their cases.” 

Computer Accelerations Corp. v. Microsoft Corp., 503 F.Supp.2d 819, 822 (E.D.Tex. 2007). The 

rules are designed specifically to “require parties to crystallize their theories of the case early in 

litigation and to adhere to those theories once they have been disclosed.” Atmel Corp. v. Info. 

Storage Devices, Inc., 1998 WL 775115, at *2 (N.D. Cal. Nov. 5, 1998). This is “to ‘prevent the 

‘shifting sands’ approach to claim construction.’” O2 Micro Int'l Ltd. v. Monolithic Power Sys., 

Inc., 467 F.3d 1355, 1364 (Fed. Cir. 2006) (citing Atmel, 1998 WL 775115, at *2). As 

distinguished from the liberal standard for amending pleadings, “the philosophy behind 

amending claim charts is decidedly conservative.” Atmel, 1998 WL 775115, at *2. However, 

Rule 3.7 “is not a straitjacket into which litigants are locked from the moment their contentions 

are served”; instead, “a modest degree of flexibility [exists], at least near the outset.” Comcast 

Cable Communs. Corp. v. Finisar Corp., 2007 WL716131, at *2 (N.D. Cal. March 2, 2007).

Pursuant to L. Pat. R. 3.7, leave to amend invalidity contentions may be granted “only by 

order of the Court upon a timely application and showing of good cause.” Rule 3.7 provides a 

nonexhaustive list of circumstances that may, absent undue prejudice to the adverse party, 

support a finding of good cause:

(a) a claim construction by the Court different from that proposed 

by the party seeking amendment; (b) recent discovery of material 

prior art despite earlier diligent search; (c) recent discovery of 

nonpublic information about the Accused Instrumentality which 

was not discovered, despite diligent efforts, before the service of 

the Infringement Contention; (d) disclosure of an infringement 

contention by a Hatch- Waxman Act party asserting infringement 

under L. Pat. R. 3.6(g) that requires response by the adverse party 

because it was not previously presented or reasonably anticipated; 

and (e) consent by the parties in interest to the amendment and a 

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showing that it will not lead to an enlargement of time or impact 

other scheduled deadlines . . . .

L. Pat. R. 3.7. Good cause “considers first whether the moving party was diligent in amending its 

contentions and then whether the non-moving party would suffer prejudice if the motion to 

amend were granted.” Acer, Inc. v. Tech. Prob. Ltd., 2010 WL 3618687, at *3 (N.D. Cal. Sept. 

10, 2010) (citing O2 Micro, 467 F.3d 1355, 1355). Importantly, however, the Court may only 

consider prejudice to the non-moving party if the moving party is able to demonstrate diligence. 

Apple v. Samsung, 2012 U.S. Dist. LEXIS 83115, at *13 (N.D. Cal. Mar. 27, 2012) (collecting 

cases).

Courts have understood diligence to require a “showing that the party seeking leave to 

amend acted . . . promptly [in] moving to amend when new evidence is revealed in discovery.” 

O2 Micro, 467 F. 3d 1355, 1363, 1366 (collecting cases). This requirement is consistent with L. 

Pat. Rule 3.7’s requirement that the Motion be “timely.” As with good cause in general, the 

burden “is on the movant to establish diligence rather than on the opposing party to establish lack 

of diligence.” O2 Micro, 467 F. 3d 1355, 1366.

In determining whether good cause exists, courts have also considered such other factors 

as (1) the reason for the delay, including whether it was within the reasonable control of the party 

responsible for it; (2) the importance of what is to be excluded; (3) the danger of unfair 

prejudice; and (4) the availability of a continuance and the potential impact of a delay on judicial 

proceedings. See Oy Ajat, Ltd. v. Vatech Am., Inc., 2012 WL 1067900, at *20-21 (D.N.J. Mar. 

29, 2012) (collecting cases).

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III. DISCUSSION

A. Sandoz’s Motion

Sandoz seeks leave to supplement its on-sale bar defense and to add a new inventorship 

defense. First, Sandoz has identified three instances which it claims show that the claimed 

invention was on sale more than one year prior to the “Critical Date.”3Specifically, Sandoz 

identifies three agreements to manufacture or deliver the claimed invention: (1) Plaintiffs’ 1998 

dealings with Oreal; (2) Plaintiffs’ 2000 dealings with SP Pharmaceuticals (“SP”); and (3) 

Plaintiffs’ 2000 dealings with MGI Pharma, Inc. (“MGI”). 

Sandoz argues its application is timely and is supported by good cause, for (at least) the 

following reasons: (1) Sandoz advised Plaintiffs of its proposed amendments within two months 

of the completion of document production, and provided Plaintiffs with a copy two weeks before 

the first deposition in the case; (2) the proposed amendments represent only further development 

of the on-sale bar defense disclosed by Sandoz over one year ago; and (3) the subject matter of 

the proposed amendments is extremely important. Sandoz’s Br. at 14.

In opposition, Plaintiffs argue that Sandoz was not diligent in moving to amend. 

Specifically, Plaintiffs claim Sandoz’s proposed Amended Invalidity Contentions are based on 

long-available information and present new legal and factual theories not previously disclosed. 

1. Diligence & Timeliness

In this case, Sandoz has made a threshold showing that it was diligent in moving to 

amend its Invalidity Contentions following discovery of new information. Sandoz cites ten 

documents in support of its proposed amendments. Eight of those documents were produced in 

 

3

In this case, as the parent application for all three patents-in-suit was filed on January 30, 2003, 

the Critical Date is January 30, 2002. 

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June 2012 and two more documents were produced in November 2012. Cert. of H. Liu at ¶ 7. 

Plaintiffs claim that they produced documents as early as May 2012 which should have 

alerted Sandoz to the defenses it now seeks to raise. Pl.’s Opp. at 5 (referring to document 

included in Sandoz’s initial Invalidity Contentions, the “Stacher Reference”). Plaintiffs also

point out that at least eight of the documents Sandoz now relies on were produced as early as 

June 2012. Id. at 8-9. Plaintiffs, however, do not dispute that their document production was not 

complete until November 2012. Indeed, it appears that more than half of Plaintiffs’ production 

occurred at that time, including at least two documents which Sandoz claims are critical to its 

proposed amended Invalidity Contentions. See Decl. of H. Liu at ¶ 7 (Ex.’s A-J). That pieces of 

the puzzle might have been revealed at earlier times does not mean that a complete picture was 

likewise available. It is reasonable to conclude, therefore, that Sandoz was not able to formulate 

a “comprehensive story of Plaintiffs’ commercial activities in violation of the on-sale bar,” 

Sandoz’s Br. at 5, until Plaintiffs had completed their document production.4

Sandoz also maintains its delay in moving to amend is justified by ongoing settlement 

discussions as well as its own document production. See Sandoz Reply at 2. These arguments are 

not, in and of themselves, independently compelling. To be sure, a party should not be able to 

avoid its responsibilities in one respect (i.e., diligence in moving to amend) simply because it has 

concurrent discovery obligations or ongoing settlement discussions. However, when viewed in 

context, they suggest Sandoz was conscientiously pursuing its obligations in this case and further 

counsel against a finding of neglect or lack of diligence. 

Sandoz was also diligent in moving to amend following discovery of new evidence to 

support its inventorship defense. Sandoz’s inventorship defense is based on papers Plaintiffs 

 

4

This is not to say that Sandoz acted as expeditiously as possible. Still, when viewed on balance, 

the Court believes Sandoz’s proposed amendments should be permitted. 

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filed with the U.S. Patent and Trademark Office in December 2012 seeking to remove Enrico 

and Riccardo Braglia as inventors from each of the patents-in-suit. Based on Plaintiffs’ actions in 

removing these inventors, Sandoz began researching the potential new inventorship defense. On

November 14, 2012, Plaintiffs produced a May 1995 “Formulation Book for Intravenous Dosage 

Forms” (the “Formulation Book”) prepared by Dr. Roger Fu from nonparty Syntex. This book, 

according to Sandoz, demonstrates that the invention may have been conceived at Syntex. 

Plaintiffs argue that Sandoz was not diligent with respect to its inventorship defense 

because the Formulations Book was previously produced. However, although excerpts of the 

Formulations Book were, in fact, produced, the entire book was not produced until November 

2012. And, more importantly, Plaintiffs did not seek to remove the previously named inventors 

until December 2012—just one month before Sandoz filed its Motion to Amend. Thus, when 

viewed in context, it appears Sandoz did diligently move to amend after it learned of the possible 

defense. 

Finally, Plaintiffs’ reliance on this Court’s decision in King Pharmaceuticals, Inc. v. 

Sandoz Inc., 2010 WL 2015258 (D.N.J. May 20, 2010), is misplaced. King involved Sandoz’s 

attempt to amend its Invalidity Contentions nearly eight months after serving its initial Invalidity

Contentions. Id. at 1. In that case, Sandoz based its motion to amend on documents which had 

been available to it for 18 months prior to filing its motion. Id. This Court denied Sandoz’s 

motion because “waiting 18 months to appreciate the materiality” of the publications which gave 

rise to the motion to amend did not demonstrate diligence in moving to amend. Id. at *4. This

Court also denied Sandoz’s motion because the proposed amendments in that case would “delay 

discovery, lengthen the life of this case and ultimately prejudice Plaintiffs.” Id. at *5.

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In this case, although Sandoz served its initial Invalidity Contentions in December 2011, 

its First Amended Invalidity Contentions were not served until November 2012. In contrast to 

King, Sandoz here took only two months to seek leave to amend its First Amended Invalidity 

Contentions. In addition, Sandoz claims that it was not until document production was complete 

in November 2012 that it fully appreciated the materiality of documents they claim support their 

Motion. Accepting this as true, it took Sandoz only two months from that time to move to 

amend. 5Furthermore, as discussed below, the Court here does not have similar concerns 

regarding prejudice and delay.

2. Prejudice

In deciding whether Plaintiffs’ proposed amendments would unfairly prejudice Plaintiffs, 

the Court considers whether permitting the proposed amendments would (1) require Plaintiffs to 

expend significant additional resources; or (2) significantly delay the resolution of the dispute. 

TFH Publications, Inc. v. Doskocil Mfg. Co., Inc., 705 F. Supp. 2d 361, 366 (D.N.J. 2010); see

also O2 Micro, 467 F.3d at, 1366-68.

Here, Plaintiffs will suffer no prejudice if Sandoz is granted leave to amend. Fact 

discovery closed on May 15, 2013 and will likely not need to be reopened because of the new 

Invalidity Contentions. 6 Although depositions are ongoing, the Parties have agreed to 

conditionally allow questions regarding the proposed amendments. Expert discovery is also 

ongoing. The deadline for dispositive motions is not until August 16, 2013, and a trial date has 

 

5

Plaintiffs place great emphasis on a document relied on by Sandoz in its December 2011 

Invalidity Contentions, the “Stacher Reference”. See, e.g., Pl.’s Opp. at 5. Plaintiffs claim the 

Stacher Reference evidences Plaintiffs’ agreement with MGI. Id. at 5-6. Plaintiffs, however, fail 

to adequately support their position that a single paragraph in this document should have led 

Sandoz to conclude that Plaintiffs had reached an agreement with MGI prior to the Critical Date. 

6

To the extent the Parties need to conduct additional discovery regarding Sandoz’s new 

inventorship defense, the Court believes such discovery will be minimal. Thus, there would be 

no significant prejudice to Plaintiffs in this regard. 

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not yet been set. By all accounts, the litigation is progressing according to schedule. Allowing 

the proposed Amended Invalidity Contentions, therefore, will not cause Plaintiffs to incur 

additional expenses or significantly delay resolution of this matter. 

Moreover, in contrast to Plaintiffs, Sandoz may be significantly prejudiced if it is not 

permitted to proceed with its proposed new defenses. Plaintiffs do little to contradict Sandoz’s 

position that the evidence is potentially fatal to Plaintiffs’ case (and patent). As a result, 

preventing Sandoz from presenting all of its defenses would not facilitate resolution on the 

merits. See Acco Brands, Inc. v. PC Guardian Anti-Theft Prods., Inc., 2008 U.S. Dist. LEXIS 

88142 (N.D. Cal. May 22, 2008) (granting motion to amend invalidity contetions and discussing 

court’s preference to decide cases on the merits); see also Dole v. Arco Chem. Co., 921 F.2d 

484, 487 (3d Cir. 1990) (discussing strong policy for deciding claims on the merits as opposed to 

technicalities). This notion is especially true where, as here, any risk of unfair surprise or delay is 

mitigated by the fact that Plaintiffs’ own documents (and actions) form the bases of the proposed 

Amended Invalidity Contentions. Contra CoreLogic Info. Solutions, Inc. v. Fiserv, Inc., 2012 

WL 4051823, at *3 (E.D. Tex. Sept. 13, 2012) (denying motion to amend invalidity contentions 

where movant “fail[ed] to appreciate the importance of enforcing the disclosure and discovery 

rules to ensure that outcomes are based upon the merits, and not unduly influenced by surprise 

and delay.”). Accordingly, Sandoz’s Motion is GRANTED.

B. Teva’s Motion

Teva also seeks leave to amend its Invalidity Contentions to include on-sale bar defenses

that are substantially identical to Sandoz’s. Teva’s proffered bases for granting leave to amend 

are likewise substantially the same as Sandoz’s. As a result, the discussion above is incorporated 

by reference, and Teva’s Motion is GRANTED.

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C. DRL’s Motion

DRL seeks leave to amend its Invalidity Contentions as to the obviousness of the patentsin-suit by adding certain pieces of prior art; namely, three Helsinn press releases totaling six 

pages. According to DRL, these “newly-discovered prior art press releases strengthen DRL’s 

existing contention that the patents-in-suit are invalid for obviousness.” DRL’s Br. at 1. 

Plaintiffs once again point out that the press releases cited by DRL were produced first in 

May 2012 and later in June 2012. Pl.’s Opp. at. 23. For substantially the same reasons discussed 

with respect to Sandoz above, the Court concludes that DRL was diligent in moving to amend; 

that is, DRL did not have a complete picture of Plaintiffs’ actions until document production was 

complete.

Furthermore, Plaintiffs have not demonstrated any tangible prejudice which would result 

if the press releases are permitted. In fact, Plaintiffs even argue that the press releases “are 

simply not material because, among other reasons, they are at best cumulative of other 

documents that [DRL] already cites.” Id. at 25. DRL, moreover, has stated that the press releases 

do not add a new defense, but rather add to its existing obviousness defense. The Court, 

therefore, concludes that the press releases would not cause additional expense or delay. 

Accordingly, DRL’s Motion in this regard is GRANTED.

In addition to the press releases, DRL also asks the Court to grant it leave to amend its 

Invalidity Contentions to “incorporate by reference” any amendments permitted as to Sandoz 

and/or Teva. DRL’s Br. at 1. DRL’s request, without more, does not obviate DRL’s need to 

comply with Local Patent Rule 3.7. Cf. Johnson v. Manhattan Ry. Co., 289 U.S. 479, 496-97 

(1933) (“[C]onsolidation is permitted as a matter of convenience and economy in administration, 

but does not merge the suits into a single cause, or change the rights of the parties, or make those 

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who are parties in one suit parties in another.”). Accordingly, DRL’s Motion is this regard is 

DENIED.

IV. CONCLUSION & ORDER

The Court has considered the papers submitted pursuant to FED. R. CIV. P. 78 and, for the 

reasons set forth above,

IT IS on this 2

nd day of July, 2013,

ORDERED that Sandoz’s Motion to Amend its Invalidity Contentions is GRANTED; 

and it is further

ORDERED that Teva’s Motion to Amend its Invalidity Contentions is GRANTED; and 

it is further 

ORDERED that DRL’s Motion to Amend its Invalidity Contentions is GRANTED, in 

part, and DENIED, in part; and it is further 

ORDERED that Defendants shall serve their Amended Invalidity Contentions within 

seven (7) days from the date of this Order; and it is further 

ORDERED that a telephone status conference, to be initiated by counsel for Plaintiffs, 

has been scheduled in this matter for July 10, 2013 at 10:00 AM.

/s/ Douglas E. Arpert

DOUGLAS E. ARPERT

UNITED STATES MAGISTRATE JUDGE 

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