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Federal Circuit's Jurisdictional Decision for ANDA Cases Has Important Implications for BPCIA Litigation

Since the Supreme Court's decision in Daimler AG v. Bauman, 134 S.Ct. 746 (2014)—effectively limiting the reach of general jurisdiction to defendant's "home" states of incorporation or principal place of business—generic drug manufacturers, such as Mylan, have used Daimler to challenge personal jurisdiction in ANDA cases filed outside their home states.  In ANDA cases, just as in cases under the BPCIA, a lawsuit is precipitated by the filing of a regulatory application for the purpose of marketing the proposed product prior to the expiration of the innovator company's patents.  Mylan had argued that there is no personal jurisdiction outside a generic manufacturer's home states until actual sales occur, at which point there is specific personal jurisdiction, and that ANDA cases, unlike other patent cases, therefore can only be litigated in defendants' home states post-Daimler.

On March 18, 2015, the Federal Circuit affirmed decisions by the District Court of Delaware to assert personal jurisdiction over West Virginia-based manufacturer Mylan in two different ANDA cases:  Astrazeneca AB v. Mylan Pharms, Inc., 72 F. Supp. 3d 549, 558 (D. Del. Nov. 5, 2014), Fed. Cir. Docket No. 15-1460 and Acorda Therapeutics v. Mylan Pharms. Inc., 78 F. Supp. 3d 572 (D. Del. Jan. 14, 2015), Fed. Cir. Docket No. 15-1456.

At issue were two theories of personal jurisdiction relied on by patent owners in post-Daimler ANDA litigation. The first theory involves specific jurisdiction, i.e. that jurisdiction arises from defendant's filing of an ANDA with the intent to market a generic drug in the chosen forum (and elsewhere) upon approval, triggering a suit that will determine when the ANDA can be approved and when the marketing in the forum can take place.  The second theory involves consent jurisdiction, i.e. that a defendant who registers to do business in the state under Delaware's registration statute has consented to general jurisdiction in the forum.  The district court in Astrazeneca found specific jurisdiction.  The district court in Acorda asserted jurisdiction on the basis of consent and specific jurisdiction.

The Federal Circuit affirmed both decisions on specific jurisdiction, without reaching general jurisdiction. The court held that "the minimum-contacts standard is satisfied by the particular actions Mylan has already taken—its ANDA filings—for the purpose of engaging in that injury-causing and allegedly wrongful marketing conduct" in Delaware.  The Federal Circuit explained that the "ANDA filings are tightly tied, in purpose and planned effect, to the deliberate making of sales in Delaware (at least) and the suit is about whether that in-State activity will infringe valid patents."  It detailed how the "Hatch-Waxman Act recognizes the close connection between the ANDA filing and the real-world acts that approval of the ANDA will allow and that will harm patent-owning brand-name manufacturers."  The court held that the "marketing in Delaware that Mylan plans is suit-related: the suits over patent validity and coverage will directly affect when the ANDA can be approved to allow Mylan's Delaware marketing and when such marketing can lawfully take place."

In a concurring opinion, Circuit Judge O'Malley agreed that Mylan is subject to specific personal jurisdiction.  But she stated that she would have reached general jurisdiction as well since it "merely requires acknowledging a century-old line of Supreme Court precedent."  Judge O'Malley explained that personal jurisdiction is a privilege that may be waived before or after Daimler, and that Mylan consented to jurisdiction in Delaware when it registered to do business there.  She noted that "[a]ny argument that Mylan's express consent to general personal jurisdiction was involuntary…is not well-taken" since Mylan undeniably "voluntarily elected to do business in Delaware and to register and elect an agent for service of process in that state."

Under the Federal Circuit's decision, plaintiffs in ANDA and BPCIA cases can continue to bring suit against generic and biosimilar manufacturers respectively in their forum of choice so long as consideration of fairness, such as efficiency or undue burden, do not render jurisdiction in the forum unreasonable.

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