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Amphastar Pharmaceuticals Inc. v. Aventis Pharma Sa

November 14, 2012


The opinion of the court was delivered by: Marvin J. Garbis United States District Judge


The Court has before it Defendants' Motion to Dismiss False Claims Act Qui Tam Complaint [Document 43-1], Defendants' Request for Judicial Notice [Document 44], and the materials submitted relating thereto. The Court has held a hearing and has had the benefit of the arguments of counsel.


A. The First Suit

At all times relevant hereto, Amphastar Pharmaceuticals, Inc. ("Amphastar") and Sanofi-Aventis S.A. ("Aventis")*fn1 have been competitors in the pharmaceutical industry.

In 1995, Aventis received U.S. Patent No. 5,318,618 ("the '618 Patent") for an anti-coagulant drug, referred to as enoxaparin. Aventis sold the drug under the brand name Lovenox®.*fn2 The drug can be used to prevent potentially fatal blood clot formation. Aventis lodged a Food and Drug Administration ("FDA") citizen petition in February 2003, arguing that enoxaparin is highly sensitive to Aventis's manufacturing process and that generics should be approved only if shown to be the same as Lovenox.

Later in 2003, Amphastar filed an Abbreviated New Drug Application ("ANDA") with the FDA, requesting the right to commercially manufacture a generic enoxaparin in competition with Aventis, and certifying that Aventis's patents were invalid, unenforceable, or not infringed. Aventis then filed a patent infringement suit against Amphastar (Civil No. 03-0887 MRP filed August 4, 2003) ("the First Suit"). This triggered a 30-month stay on FDA approval of Amphastar's ANDA.*fn3 In the First Suit, Aventis filed an antitrust counterclaim.

In the First Suit, Amphastar was granted summary judgment on its affirmative defense and counterclaim of inequitable conduct and the antitrust counterclaim was stayed pending appeal of the infringement claim dismissal. Aventis Pharma S.A. v. Amphastar Pharm., Inc., 390 F. Supp. 2d 952 (C.D. Cal. 2005). On appeal, the Federal Circuit reversed and remanded for the district court to find whether Amphastar could prove intent to deceive by clear and convincing evidence. Aventis Pharma S.A. v. Amphastar Pharm., Inc., 525 F.3d 1334 (Fed. Cir. 2008).

On remand, Judge Pfaelzer of this Court held a bench trial, made the requisite finding, and found the patents unenforceable on the grounds of inequitable conduct. This decision was affirmed by the Federal Circuit. Thereafter, the stay of the antitrust counterclaim was lifted. In January 2009, Aventis filed a motion to dismiss the antitrust counterclaim in the First Suit. In February 2009, Aventis's motion to dismiss the antitrust counterclaim was granted because the antitrust allegations that survived Noerr-Pennington immunity failed to allege antitrust injury, a necessary element. See Mot. Ex. 1, Aventis v. Amphastar, No. 03-cv-0887 (C.D. Cal. May 15, 2009).

B. The Instant Case

In January 2009,*fn4 Amphastar commenced the instant litigation by filing the sealed qui tam Complaint under the False Claims Act ("FCA"), 31 U.S.C. § 3729 [Document 1] on behalf of the United States ("the Government") and several states.

In the instant case, Amphastar claims that Aventis:

(1) made false representations to the U.S. Patent & Trademark Office ("PTO") while prosecuting its U.S. patents;

(2) improperly listed its '618 patent and another Aventis patent, U.S. Patent No. 4,692,435 ("the '435 patent"), in the FDA's "Orange Book"*fn5 indicating that both patents covered Lovenox;

(3) engaged in baseless litigation against Amphastar that triggered the 30-month stay of its ANDA;

(4) made false representations and material omissions to the FDA; and

(5) attempted to control the supply of components necessary for market approval or marketing of enoxaparin.

Mot. 10.

Amphastar alleges that Aventis thereby fraudulently inflated the price of enoxaparin, thus overcharging the federal and various state governments. The Government and the states elected to decline intervention*fn6 on October 19, 2011. [Documents 30 and 31]. The Complaint was unsealed on October 28, 2011. [Document 32].

By the instant motion, Aventis seeks dismissal of all claims on three grounds:

(1) lack of subject matter jurisdiction;

(2) failure to state an FCA claim upon the alleged antitrust violations; and

(3) failure to meet the minimum standards required for FCA qui tam claims.


A. Lack of Subject Matter Jurisdiction, Rule 12(b)(1)*fn7

A motion to dismiss filed under Rule 12(b)(1) addresses the court's subject matter jurisdiction. A federal court has federal-question subject matter jurisdiction over an action that arises under federal law and diversity jurisdiction when there is complete diversity of citizenship between the parties and the amount in controversy exceeds $75,000. See 28 U.S.C. §§ 1331, 1332(a). In the instant case, the existence vel non of diversity jurisdiction is immaterial. Amphastar can obtain federal-question jurisdiction only if it has a viable case under the FCA.

The plaintiff bears the burden of proving jurisdiction to survive a Rule 12(b)(1) motion to dismiss. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). The applicable standard depends on the nature of the jurisdictional challenge.

A jurisdictional attack may be either facial or factual. Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004). In a facial attack, the movant "asserts that the allegations contained in a complaint are insufficient on their face to invoke federal jurisdiction." Id. The court considers the complaint's allegations to be true, and "the plaintiff enjoys safeguards akin to those applied when a Rule 12(b)(6) motion is made." Doe v. Schachter, 804 F. Supp. 53, 57 (N.D. Cal. 1992).

A factual attack occurs when the movant "disputes the truth of the allegations that, by themselves, would otherwise invoke federal jurisdiction." Safe Air, 373 F.3d at 1039. The court is not restricted to the face of the pleadings when there is a fact-based challenge to jurisdiction, but may consider evidence outside the four corners of the Complaint and must resolve material issues of fact. See id.

In a Rule 12(b)(1) dismissal context, "where the jurisdictional issue is separable from the merits of the case, the court may hear evidence regarding jurisdiction, resolve existing factual disputes, and rule on that issue." Doe, 804 F. Supp. at 57 (citing Thornhill Pub. Co. v. General Tel. & Elecs. Corp., 594 F.2d 730, 733 (9th Cir. 1979)). When jurisdictional and substantive issues are intertwined, such that the question of jurisdiction is dependent on resolving factual issues going to the merits, the court should reserve determination of the issue to a motion on the merits or trial. Id. (citing Augustine v. United States, 704 F.2d 1074, 1077 (9th Cir. 1983)).

B. Failure to State a Claim, Rule 12(b)(6)

A motion to dismiss filed under Rule 12(b)(6) tests the legal sufficiency of a complaint. A complaint need only contain "a short and plain statement of the claim showing that the pleader is entitled to relief, in order to give the defendant fair notice of what the . . . claim is and the grounds upon which it rests." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citations omitted).

When evaluating a Rule 12(b)(6) motion to dismiss, a plaintiff's well-pleaded allegations are accepted as true and the complaint is viewed in the light most favorable to the plaintiff. Broam v. Bogan, 320 F.3d 1023, 1028 (9th Cir. 2003). However, conclusory statements or a "formulaic recitation of the elements of a cause of action" will not suffice. Twombly, 550 U.S. at 555. A complaint must allege sufficient facts to cross "the line between possibility and plausibility of entitlement to relief." Id. at 557.

Inquiry into whether a complaint states a plausible claim is "a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Chavez v. United States, 683 F.3d 1102, 1109 (9th Cir. 2012)(quoting Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009)). Thus, if the well-pleaded facts contained within a complaint "do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged -- but it has not shown -- that the pleader is entitled to relief." Iqbal, 556 U.S. at 679 (quoting Fed. R. Civ. P. 8(a)(2)) (internal quotation marks omitted).


A. Judicial ...

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