Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 1 of 28 PageID #: 2574
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`IN THE UNITED STATES DISTRICT COURT
`EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
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`SEAGEN INC.,
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`v.
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`Plaintiff,
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`DAIICHI SANKYO CO., LTD.,
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`Defendant.
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`Civil Action No. 2:20-CV-00337-JRG
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`SEAGEN INC.’S OPPOSITION TO DAIICHI SANKYO CO., LTD.’S
`RULE 12(B) MOTION TO DISMISS FOR LACK OF SUBJECT MATTER
`JURISDICTION AND LACK OF PERSONAL JURISDICTION
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 2 of 28 PageID #: 2575
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`TABLE OF CONTENTS
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`Page
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`INTRODUCTION ............................................................................................................. 1
`BACKGROUND ............................................................................................................... 2
`A.
`Procedural History ................................................................................................. 2
`B.
`Daiichi Sankyo Co. Ltd. Places Enhertu Into The Stream Of Commerce
`And Targets Texas For Business ........................................................................... 2
`Daiichi Sankyo Co. Ltd. Controls Daiichi Sankyo, Inc.’s Business
`Activities ................................................................................................................ 4
`DSC Has Made Numerous Misstatements Regarding Jurisdiction ....................... 4
`D.
`LEGAL STANDARD ........................................................................................................ 6
`III.
`IV. ARGUMENT ..................................................................................................................... 6
`A.
`This Court Has Personal Jurisdiction Over DSC ................................................... 6
`1.
`This Court May Exercise Specific Personal Jurisdiction Over DSC ......... 7
`2.
`This Court Has Personal Jurisdiction Over DSC Under Rule
`4(k)(2) ...................................................................................................... 16
`This Court Has Subject Matter Jurisdiction Over Seagen’s Claims Because
`Seagen Filed Its Complaint After Patent Issuance ............................................... 17
`Additional Discovery Will Likely Support Jurisdiction Over DSC .................... 20
`C.
`CONCLUSION ................................................................................................................ 21
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`I.
`II.
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`V.
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`C.
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`B.
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 3 of 28 PageID #: 2576
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`TABLE OF AUTHORITIES
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`
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`Page(s)
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`Cases
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`AGIS Software Dev. LLC v. HTC Corp.,
`No. 2:17-CV-00514-JRG, 2018 WL 4680557 (E.D. Tex. Sept. 28, 2018) ...............................8
`
`Albany International Corp. v. Yamauchi Corp.,
`978 F. Supp. 2d 138 (N.D.N.Y. 2013) .....................................................................................16
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`Allied Theatre Owners of Ind., Inc. v. Volpe,
`426 F.2d 1002 (7th Cir. 1970) .................................................................................................19
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`Asahi Metal Indus. Co. v. Super. Ct.,
`480 U.S. 102 (1987) ...............................................................................................................8, 9
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`Bristol-Myers Squibb Co. v. Super. Ct.,
`137 S. Ct. 1773 (2017) .............................................................................................................11
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`Burger King Corp. v. Rudzewicz,
`471 U.S. 462 (1985) ...................................................................................................................7
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`Canon, Inc. v. TLC Elecs. Holdings Ltd.,
`No. 2:18-CV-00546-JRG, 2020 WL 1478356 (E.D. Tex. Mar. 25, 2020) ..............................12
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`Cedars-Sinai Med. Ctr. v. Watkins,
`11 F.3d 1573 (Fed. Cir. 1993)....................................................................................................6
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`Celgard, LLC v. SK Innovation Co., Ltd.,
`792 F.3d 1373 (Fed. Cir. 2015)..................................................................................................6
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`Cerro Wire Inc. v. Southwire Co.,
`777 F. Supp. 2d 1334 (N.D. Ga. 2011) ....................................................................................17
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`Daimler AG v. Bauman,
`134 S. Ct. 117 (2014) ...............................................................................................................17
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`Encore Wire Corp. v. Southwire Co.,
`No. 3:10-CV-86-BMGL, 2011 WL 833220 (N.D. Ga. Mar. 4, 2011) ....................................17
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`Fellowship Filtering Techs., LLC v. Alibaba.com, Inc.,
`No. 2:15-cv-2049-JRG, 2016 WL 6917272 (E.D. Tex. Sept. 1, 2016) ...................................13
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`Ford Motor Co. v. Montana Eighth Judicial Dist. Ct.,
`No. 19-368, slip op. (U.S. Mar. 25, 2021) ...............................................................................10
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 4 of 28 PageID #: 2577
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`GAF Bldg. Materials Corp. v. Elk Corp. of Dallas,
`90 F.3d 479 (Fed. Cir. 1996)....................................................................................................17
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`J. McIntyre Machinery, Ltd. v. Nicastro,
`564 U.S. 873 (2011) .................................................................................................................11
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`Merial Ltd. v. Cipla Ltd.,
`681 F.3d 1283 (Fed. Cir. 2012)................................................................................................16
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`Motio, Inc. v. BSP Software LLC,
`No. 4:12-CV-647, 2015 WL 8770356 (E.D. Tex. Dec. 15, 2015) ............................................6
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`NobelBiz, Inc. v. Global Connect, L.L.C.,
`No. 6:13-cv-804-MHS, 2014 WL 12613389 (E.D. Tex. Feb. 26, 2014) ...........................17, 18
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`Nuance Commc’ns, Inc. v. Abbyy Software House,
`626 F.3d 1222 (Fed. Cir. 2010)........................................................................................7, 8, 15
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`Polar Electro Oy v. Suunto Oy,
`829 F.3d 1343 (Fed. Cir. 2016)........................................................................................6, 9, 10
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`Rojas v. Bd. of Liquor License Comm’rs for Baltimore City,
`148 A.3d 108 (Md. Ct. Spec. App. 2016) ..........................................................................18, 19
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`Semcon IP Inc. v. TCT Mobile Int’l Ltd.,
`No. 2:18-CV-00194-JRG, 2019 WL 2774362 (E.D. Tex. July 2, 2019) .................7, 10, 11, 15
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`Sunday v. Madigan,
`301 F.2d 871 (9th Cir. 1962) ...................................................................................................20
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`Susan McKnight, Inc. v. United Indus. Corp.,
`273 F. Supp. 3d 874 (W.D. Tenn. 2017)..................................................................................12
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`Texas Spine & Joint Hosp., Ltd. v. Blue Cross & Blue Shield of Tex.,
`No. 6:14-CV-952-JDL, 2015 WL 13649419 (E.D. Tex. May 28, 2015) ..................................6
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`Time Life Broad. Co. v. Boyd,
`289 F. Supp. 219 (S.D. Ind. 1968) ...........................................................................................19
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`Truman v. United States,
`26 F.3d 592 (5th Cir. 1994) .......................................................................................................6
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`Vinson v. Credit Control Servs., Inc.,
`908 F. Supp. 2d 274 (D. Mass. 2012) ......................................................................................19
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`Wapp Tech Ltd. P’ship v. Micro Focus Int’l, PLC,
`406 F. Supp. 3d 585 (E.D. Tex. 2019) .......................................................................................6
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 5 of 28 PageID #: 2578
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`Statutes and Other Authorities
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`15 U.S.C.
`§ 260.........................................................................................................................................18
`§ 262.........................................................................................................................................19
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`28 U.S.C.
`§ 1404.......................................................................................................................................16
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`35 U.S.C.
`§ 271(a) ......................................................................................................................................8
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`Fed. R. Civ. Proc.
`Rule 4(k)(2) ..........................................................................................................................7, 16
`Rule 12(b)(1) ..............................................................................................................................6
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 6 of 28 PageID #: 2579
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`I.
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`INTRODUCTION
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`Daiichi Sankyo Co., Ltd. (“DSC”) is subject to personal jurisdiction in Texas because it
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`places the accused drug, Enhertu®, in the stream of commerce knowing it will reach Texas,
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`because its agents operate in Texas, and because it has no presence in another, better-suited
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`forum. DSC’s employees oversee the global supply chain of Enhertu, including the supply
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`destined for the US.
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` And DSC does so knowing that Enhertu will be sold in Texas, including in this District.
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`DSC’s contention that it is not responsible for Enhertu’s sales in the US and Texas
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`because they are managed by its US subsidiary, Daiichi Sankyo, Inc. (“DSI”), ignores the close
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`relationship between the two entities. DSI is wholly owned by DSC, the president of DSI reports
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`to the CEO of DSC, and many corporate officers have roles in both entities. Regardless, DSC
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`has contacts with Texas related to Enhertu. It has conducted clinical trials for Enhertu at
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`research hospitals in Texas, and has presented data and sponsored research relating to Enhertu at
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`symposia in Texas.
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`DSC’s other jurisdictional argument—that this suit was allegedly filed before the ’039
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`patent issued—fails. There can be no dispute that the ’039 patent issued on October 20 Eastern
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`Time. When a patent issues in Eastern Time, which is where the PTO is seated, it has issued
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`everywhere regardless of intra-US time differences, as this Court has previously held. The
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`Uniform Time Act does not change that. Seagen Inc.’s (“Seagen”) case was properly and timely
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`filed.
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`Further discovery—warranted here because DSC obstructed Seagen’s discovery at every
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`turn—will likely reveal additional DSC contacts with this forum. Seagen requests permission to
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`propound this discovery and supplement this opposition.
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 7 of 28 PageID #: 2580
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`II.
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`BACKGROUND
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`A.
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`Procedural History
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`On October 20, 2020, at 12:00 am EDT, Seagen’s U.S. Patent No. 10,808,039 (the “’039
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`patent”) issued. (Chivvis Decl. ¶ 21; Ex. 23.) Seagen filed suit immediately thereafter. (Dkt. 1.)
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`Seagen’s complaint alleges that DSC directly infringes, contributes to infringement, and induces
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`infringement of Seagen’s ’039 patent by making, using, offering for sale, selling, importing, and
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`promoting the use of infringing products, including Enhertu. (Id. ¶ 22.)
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`Nearly a month later, on November 13, 2020, DSC—along with its wholly owned
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`subsidiary DSI and AstraZeneca Pharmaceuticals LP (“AstraZeneca US”)—filed a mirror-image
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`suit in the District of Delaware seeking declaratory judgment that Enhertu does not infringe the
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`’039 patent. (Chivvis Decl. ¶ 22; Ex. 15.) Seagen has moved to stay or dismiss that lawsuit in
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`favor of this first-filed action. (Chivvis Decl. ¶ 23; Ex. 16.)
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`B.
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`Daiichi Sankyo Co. Ltd. Places Enhertu Into The Stream Of Commerce And
`Targets Texas For Business
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`Defendant DSC is headquartered in Tokyo, Japan and incorporated under Japanese law.
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`(Mot. at 3.) Jurisdictional discovery has revealed that, contrary to its assertions, DSC targets the
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`US and Texas, and is active in both. DSC manufactures Enhertu for distribution and sale in the
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`US, and recognizes revenue from US sales of Enhertu. (Id. at 3–4; Ex. 1 at 137:20–138:3;
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`Ex. 21 at 38, 87.)1 In its own public documents, DSC stresses the importance of the US market
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`to its business, stating that “growth in the U.S. market, the world’s largest market for
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`pharmaceuticals, is of critical importance.” (Ex. 21 at 66.) DSC holds the US registered
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`trademark for Enhertu,
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` (Ex. 24
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`1 All references to “Ex.” are to exhibits attached to the Declaration of Matthew A. Chivvis filed
`contemporaneously with this motion (“Chivvis Decl.”).
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 8 of 28 PageID #: 2581
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`DSC_ENHERTU_00025252, –255, -265.)
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`DSC has significant contacts of its own with Texas. DSC conducted clinical trials related
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`to Enhertu at the University of Texas MD Anderson Cancer Center and also at the University of
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`Texas Southwestern Medical Center. (Ex. 5 [Response to Rog. 5].) DSC presented data and
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`sponsored research related to Enhertu at the last four San Antonio Breast Cancer Symposia in
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`San Antonio, Texas. (Ex. 9; Ex. 21 at 73–74.)
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`2 The International Chamber of Commerce defines “Delivered Duty Paid” as meaning “the seller
`delivers the goods when the goods are placed at the disposal of the buyer, cleared for import on
`the arriving means of transport ready for unloading at the named place of destination. The seller
`bears all the costs and risks involved in bringing the goods to the place of destination and has an
`obligation to clear the goods not only for export but also for import, to pay any duty for both
`export and import and to carry out all customs formalities.” (Ex. 27 at 3.)
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 9 of 28 PageID #: 2582
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`C.
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`Daiichi Sankyo Co. Ltd. Controls Daiichi Sankyo, Inc.’s Business Activities
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`DSC’s effort to distance itself from DSI and the commercialization of Enhertu in the US
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`is a shell game. Most of DSI’s upper management are DSC corporate officers, and DSI’s CEO,
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`Ken Keller, reports to DSC’s CEO, Sunao Manabe. (Ex. 17; Ex. 1 at 106:6–12.) Junichi Koga,
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`a Senior Executive Officer and Global Head of Research and Development at DSC, is based in
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`Baskin Ridge, New Jersey, and also holds the position of President, Daiichi Sankyo Pharma
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`Development at DSI. (Ex. 1 at 107:9–21; Ex. 18.) Koji Ogawa is the Head of the US Corporate
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`Division of DSI as well as a corporate officer of DSC. (Ex. 19; Ex. 1 at 108:19–110:25.)
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`D.
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`DSC Has Made Numerous Misstatements Regarding Jurisdiction
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`DSC supported its Motion to Transfer with declarations by DSC employee Hiroaki Miki,
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`DSI employees Kevin Smith and Daniel Switzer, and AstraZeneca US employee Albert Bucci.
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`(Dkts. 24-1; 24-2; 24-3; 24-4.) These declarations contain statements that are misleading at best,
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 10 of 28 PageID #: 2583
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`and outright false at worst.
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`Daniel Switzer’s declaration states that
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`Although Mr. Miki stated that he “would be willing to testify” to the facts in his
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`declaration (Dkt. 24-1 ¶ 1), Mr. Miki was unable to do so, and DSC agreed to allow Mr. Smith to
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`testify as to the contents of Mr. Miki’s declaration. (Chivvis Decl. ¶ 8.) Mr. Smith, the witness
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`DSC produced to testify in Mr. Miki’s place, was unprepared. For example, Mr. Miki’s
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`declaration states that “[t]he development of manufacturing processes for Enhertu® . . . occurred
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`in Japan.” (Dkt. 24-1 ¶ 6.) But Mr. Smith was not able to testify on the manufacturing process
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`in Japan,
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 11 of 28 PageID #: 2584
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`III. LEGAL STANDARD
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`Fifth Circuit law governs a motion to dismiss under Rule 12(b)(1). Cedars-Sinai Med.
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`Ctr. v. Watkins, 11 F.3d 1573, 1580 (Fed. Cir. 1993). Such a motion should be granted “only if
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`it appears beyond doubt that the plaintiff cannot prove a plausible set of facts in support of its
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`claim.” Motio, Inc. v. BSP Software LLC, No. 4:12-CV-647, 2015 WL 8770356, at *2 (E.D.
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`Tex. Dec. 15, 2015) (citing Lane v. Halliburton, 529 F.3d 548, 557 (5th Cir. 2008). In
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`evaluating a motion to dismiss, this court should “accept the well-pleaded allegations in the
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`complaint as true, and […] construe those allegations in the light most favorable to the plaintiff.”
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`Truman v. United States, 26 F.3d 592, 593–94 (5th Cir. 1994). “The Fifth Circuit has
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`consistently recognized that a dismissal for lack of subject matter jurisdiction pursuant to
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`12(b)(1) ‘should be granted sparingly.’” Texas Spine & Joint Hosp., Ltd. v. Blue Cross & Blue
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`Shield of Tex., No. 6:14-CV-952-JDL, 2015 WL 13649419, at *2 (E.D. Tex. May 28, 2015)
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`(quoting Martin v. Morgan Drive Away, Inc., 665 F.2d 598, 602 (5th Cir. 1982)).
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`Personal jurisdiction in patent cases is governed by Federal Circuit law. Celgard, LLC v.
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`SK Innovation Co., Ltd., 792 F.3d 1373, 1377 (Fed. Cir. 2015). In a dispute over personal
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`jurisdiction, the plaintiff “bears a prima facie burden if the parties conduct jurisdictional
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`discovery, the parties dispute the jurisdictional facts, and the court does not conduct a
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`jurisdictional hearing.” Wapp Tech Ltd. P’ship v. Micro Focus Int’l, PLC, 406 F. Supp. 3d 585,
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`591 (E.D. Tex. 2019) (citing Celgard, 792 F.3d at 1377). “Under that prima facie standard, the
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`court must resolve all factual disputes in the plaintiff’s favor.” Polar Electro Oy v. Suunto Oy,
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`829 F.3d 1343, 1347–48 (Fed. Cir. 2016).
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`IV. ARGUMENT
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`A.
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`This Court Has Personal Jurisdiction Over DSC
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`Jurisdiction is proper in Texas. Seagen’s complaint alleges that DSC directly infringes,
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 12 of 28 PageID #: 2585
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`contributes to infringement, and induces infringement of Seagen’s ’039 patent by making, using,
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`offering for sale, selling, importing, and promoting the use of infringing products, including
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`DSC’s Enhertu product. (Dkt. 1, Compl. ¶¶ 21-29.) Seagen’s complaint sets forth four
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`independent bases for this Court’s jurisdiction over DSC: (i) specific jurisdiction under the
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`“stream of commerce” theory (id. ¶ 10); (ii) specific jurisdiction as an indirect infringer (id. ¶¶ 9-
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`11) (which DSC does not address in its motion); (iii) specific jurisdiction through the contacts of
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`DSC’s agents (id. ¶ 11); and (iv) jurisdiction under Federal Rule of Civil Procedure 4(k)(2) (id.
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`¶ 12).
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`1.
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`This Court May Exercise Specific Personal Jurisdiction Over DSC
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`The specific jurisdiction analysis involves three factors: “(1) whether the defendant
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`purposefully directed activities at residents of the forum; (2) whether the claim arises out of or
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`relates to those activities; and (3) whether assertion of personal jurisdiction is reasonable and
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`fair.” Nuance Commc’ns, Inc. v. Abbyy Software House, 626 F.3d 1222, 1231 (Fed. Cir. 2010);
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`see also Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475–76 (1985).
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`a.
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`This Court May Exercise Specific Personal Jurisdiction Over
`DSC Under The “Stream of Commerce” Theory
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`Under the “stream of commerce” theory, DSC is subject to personal jurisdiction because
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`it purposefully avails itself of this forum by
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`and placing it into the stream of commerce with the expectation and knowledge that it be
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`available for purchase in Texas. See Semcon IP Inc. v. TCT Mobile Int’l Ltd., No. 2:18-CV-
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`00194-JRG, 2019 WL 2774362, at *3–4 (E.D. Tex. July 2, 2019) (minimum contacts satisfied if
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`defendant “delivers its products into the stream of commerce with the expectation that they will
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`be purchased by consumers in the forum state.”). As this Court has observed, the US Supreme
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`Court is split over whether this test is satisfied by “merely placing a product into the stream of
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`commerce” (the “Brennan Test”); or “whether additional conduct by the defendant purposefully
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`directed toward the forum state” is required (the “O’Connor Test”). AGIS Software Dev. LLC v.
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`HTC Corp., No. 2:17-CV-00514-JRG, 2018 WL 4680557, at *2, *4 (E.D. Tex. Sept. 28, 2018)
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`(citations omitted) (rejecting foreign manufacturer’s motion to dismiss because it “‘knew, or
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`reasonably could have foreseen, that a termination point of the channel was [Texas].’”). DSC’s
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`conduct in placing Enhertu into the stream of commerce satisfies both tests.
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`DSC admits that it manufactures the accused product abroad and “sells bulk vials of
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`Enhertu®” to DSI to “supply” “the United States” including Texas. (Mot. at 3–4; Dkt. 24-1
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`¶¶ 3-4; see also Ex. 1 at 131:15–132:9.)
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` See Nuance, 626
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`F.3d at 1233 (defendant imports an accused product within the meaning of 35 U.S.C. § 271(a)
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`when it “retains ownership in the accused software even after that software enters” the US). In
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`its 2020 Annual Report, DSC touted the launch of Enhertu in the US and Japan as “[t]he most
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`significant achievement during the current 5-year business plan period.” (Ex. 21 at 5.) DSC has
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`also stated in multiple publications that it is responsible for Enhertu “[s]ales booking” in the US,
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`and receives revenues from such sales.3 (Ex. 26 at DSC_ENHERTU_00014348; Ex. 21 at 38,
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`87; see also Ex. 3 at 68:6–13.) DSC places Enhertu in the stream of commerce, satisfying the
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`Brennan Test.
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`But DSC has also intentionally targeted Texas, satisfying the O’Connor Test. That test
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`requires “[a]dditional conduct of the defendant,” which “may indicate an intent or purpose to
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`serve the market in the forum State.” Asahi Metal Indus. Co. v. Super. Ct., 480 U.S. 102, 112
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 14 of 28 PageID #: 2587
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`(1987). The US Supreme Court provided examples of “additional conduct,” including:
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`“advertising in the forum State, establishing channels for providing regular advice to customers
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`in the forum State, or marketing the product through a distributor who has agreed to serve as the
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`sales agent in the forum State.” Id.
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`DSC has conducted clinical trials for Enhertu at the University of Texas MD Anderson Cancer
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`Center and the University of Texas Southwestern Medical Center, and has presented data and
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`sponsored research relating to Enhertu at the last four San Antonio Breast Cancer Symposia in
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`San Antonio, Texas. (Ex. 5 [Response to Rog. 5]; Ex. 9.)
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`DSC’s cited authority supports Seagen. (Mot. at 17 (citing Polar Electro, 829 F.3d at
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`1350, and Semcon, 2019 WL 2774362, at *4).) In Polar Electro, the Federal Circuit found
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`personal jurisdiction over Finnish company, Suunto, because it had “shipped at least ninety-four
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`accused products to Delaware retailers.” 829 F.3d at 1350–51. The shipping process was
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`described as follows: Suunto “physically fulfilled the orders, packaged the products, and
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`prepared the shipments in Finland” and then another party “provided the destination addresses,
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`took title to the goods in Finland, and directed and paid for shipping.” Id. at 1351. DSC’s
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`actions go further.
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`Further, as discussed in the previous paragraph, DSC has directly targeted Texas through its
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`sponsorship of clinical trials at two Texas institutions; and it presents research on Enhertu
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`annually at conferences in San Antonio.
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`Likewise, in Semcon, this court found personal jurisdiction where a foreign defendant
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`regularly shipped accused products ordered by a related entity to a warehouse in Texas; the
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`invoices listed the foreign defendant’s name and address in the footer; the foreign defendant’s
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`witness testified that the company was aware that millions of accused products were shipped to
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`Texas; and the defendant, “acting in consort” with its related entity, “deliberately and
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`purposefully” shipped products to Texas. Semcon, 2019 WL 2774362, at *4. While DSC does
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`not directly ship Enhertu to Texas, it acts in concert with DSI and other third-parties to make
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`Enhertu available in Texas, by—among other things—
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`DSC contends that a tidal shift in personal jurisdiction jurisprudence lies in wait (Mot. at
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`13–16), but this conjecture has already been proven wrong. In support, DSC cites Ford Motor
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`Co. v. Bandemer, a case argued before the US Supreme Court in October 2020. (Mot. at 16 n.9.)
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`That opinion issued on March 25, 2021. Ford Motor Co. v. Montana Eighth Judicial Dist. Ct.,
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`No. 19-368, slip op. (U.S. Mar. 25, 2021). Rather than “tightening the scope of personal
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`jurisdiction,” as DSC predicted, the US Supreme Court found Ford’s activities sufficient to
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`support personal jurisdiction. DSC also misstates the holding in Bristol-Myers Squibb Co. v.
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`Super. Ct., 137 S. Ct. 1773 (2017). There, the plaintiffs that asserted product-liability claims
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`were both residents and nonresidents of California. The Supreme Court found no jurisdiction
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`only as to the nonresidents because they “were not prescribed Plavix in California, did not
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`purchase Plavix in California, did not ingest Plavix in California, and were not injured by Plavix
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`in California.” Id. at 1781–83. The Semcon court, glossing Bristol-Myers, agreed. It affirmed
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`that “[t]he Supreme Court’s recent Bristol-Myers decision did not abrogate the stream of
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`commerce theory.” 2019 WL 2774362, at *2–3. Rather, “the plaintiffs did not show that the
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`particular stream of commerce that caused their injury ran through California.” Id. Here, on the
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`other hand, DSC specifically targets Texas
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` sponsoring clinical trials at Texas institutions, and presenting research about Enhertu at
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`multiple conferences in Texas. Further, Enhertu is being used by doctors and patients throughout
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`Texas. (Ex. 2 at 91:07–09, 111:18–112:04.) Unlike the plaintiffs in Bristol-Myers, there is
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`injury to Seagen in Texas because the accused product is sold throughout the state, and that
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`injury is part of what Seagen seeks to recover in this case. This Court’s exercise of personal
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`jurisdiction is reasonable and fair.
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`DSC also omits crucial facts in its summary of J. McIntyre Machinery. (Mot. at 13–
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`15.) The plurality opinion from McIntyre, also a product liability case, based its holding on the
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`fact that the defendant “neither advertised in, nor sent any employees to, the State.” J. McIntyre
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`Machinery, Ltd. v. Nicastro, 564 U.S. 873, 886 (2011) (plurality opinion). It noted the trial
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`court’s finding that the “‘defendant does not have a single contact with New Jersey short of the
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`machine in question ending up in this state.’” Id. DSC, by contrast, has many contacts with
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`Texas. It specifically targets Texas by
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` which makes the drug
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`available and knowingly sent to clinicians and other service providers throughout Texas; it
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`sponsored clinical trials at Texas institutions; and it presents research on Enhertu annually at
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`conferences in San Antonio.
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`b.
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`This Court Has Specific Personal Jurisdiction Over DSC As
`An Indirect Infringer
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`DSC is also subject to jurisdiction because it encourages and enables its wholly-owned
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`subsidiary, DSI, as well as other third parties to distribute and sell Enhertu throughout the US,
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`including Texas. See, e.g., Canon, Inc. v. TLC Elecs. Holdings Ltd., No. 2:18-CV-00546-JRG,
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`2020 WL 1478356, at *2-4 (E.D. Tex. Mar. 25, 2020) (finding specific jurisdiction over foreign
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`distributors because they “purposefully directed the Accused Products to this forum, and the
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`alleged infringement arises out of and/or relates thereto.”); Susan McKnight, Inc. v. United Indus.
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`Corp., 273 F. Supp. 3d 874, 884-86 (W.D. Tenn. 2017) (finding specific jurisdiction over an out-
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`of-state manufacturer that sold products in Tennessee through a third-party distributor because
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`“[i]n the indirect infringement context, federal courts have found that third-party sales can afford
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`specific jurisdiction over an alleged patent infringer.”).
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`DSC acknowledges that it “sells bulk vials of Enhertu” to DSI for
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` and sale
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`throughout the US, including Texas. (Ex. 1 at 95:12–14, 195:20–25; 207:8–12; Ex. 5 [Response
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`to Rog. 5].) DSC also admits that it manufactures all of the Enhertu made available for purchase
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`in Texas, including the supplies of Enhertu sold by third party distributors, such as McKesson
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`and ASD. (Ex. 5 [Response to Rog. 5]; Dkt. 24-1 ¶¶ 4, 6.) DSC admits that it actively
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`encourages infringing sales in Texas, asserting that the commercialization of Enhertu in Japan
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`and the United States is “[t]the most significant achievement during the current 5-year business
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`plan period.” (Ex. 21 at 5.) DSC signed a $6.9 billion commercialization deal with AstraZeneca
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`UK to market the infringing product, Enhertu, throughout the US, including Texas. (Ex. 20 at
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`Case 2:20-cv-00337-JRG Document 75 Filed 04/15/21 Page 18 of 28 PageID #: 2591
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`DSC_ENHERTU_00011723.) DSC is liable for inducement and contributory infringement
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`because it actively encourages and enables DSI’s and other third parties’ infringing activities in
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`Texas. DSC’s status as a foreign entity neither exonerates it from liability nor enables it to
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`escape this Court’s jurisdiction.
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`c.
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`The Court Has Specific Personal Jurisdiction Over DSC Under
`Agency Theory
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`DSC is also subject to jurisdiction under an agency theory. DSC does not dispute that its
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`wholly-owned subsidiary, DSI, as well as other distributors and sellers have contacts with Texas.
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`“It is possible for a third party’s contacts with the forum to be imputed to a named defendant to
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`establish specific personal jurisdiction under either an agency or alter ego theory.” Fellowship
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`Filtering Techs., LLC v. Alibaba.com, Inc., No. 2:15-cv-2049-JRG, 2016 WL 6917272, at *2
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`(E.D. Tex. Sept. 1, 2016) (citing Celgard, 792 F.3d at 1379). To impute the contacts of a third
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`party to the defendant under an agency theory, the defendant must exercise control over the third
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`party’s activities in the forum by “directing its agents or distributors to take action there.” Id.
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`(citing Daimler AG v. Bauman, 134 S. Ct. 117, 759 n.13 (2014)). DSC directs its agents to take
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`action in Texas.
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`DSC’s control over DSI goes beyond the “typical parent-subsidiary corporate
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`relationship” that was insufficient to establish agency in Fellowship. Id. at *4. In Fellowship,
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`the evidence of control was as follows: The existence of tax credit allocation agreements
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`amongst several subsidiaries executed by a single employee, along with SEC filings indicating
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`the various entities had contractual relationships enabling “effective control” over one another.
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`And the parent’s “review [of] certain decisions” of the subsidiary, which was owned by the same
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`majority shareholder as the parent. Id. at *4–5. DSC exercises far more control over DSI than
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`the indicia of control in Fellowship. Most of DSI’s upper management is comprised of DSC
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`corporate officers, and DSI’s CEO reports to DSC’s CEO. (Ex. 17; Ex. 1 at 106:6–12.) DSC’s
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`declarations, the testimony of its 30(b)(6) witnesses, and its documents confirm that DSC
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`controls DSI—and other entities in Enhertu’s supply chain—with the specific goal of selling
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`Enhertu throughout Texas. For example:
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`• DSC established “Daiichi Sankyo, Inc., a US subsidiary headquartered in New
`Jersey, in April 2006 through the integration of the US-based operations of
`Daiichi and Sankyo. Daiichi Sankyo Inc. is one of the channels through which
`[DSC] intend[s] to expand our US operations.” (Ex. 22 at 13.) DSI is DSC’s
`wholly-owned subsidiary. (Ex. 5 [Response to Rog. 2].)4
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`• DSC admits that “leaders who direct and plan the supply chain of Enhertu®, also
`are located in Japan.” (Dkt. 24-1 ¶ 6 (emphasis added).)
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`• DSC’s Senior Director of the Supply Chain M