Case 2:20-cv-00337-JRG Document 83 Filed 04/21/21 Page 1 of 13 PageID #: 2699
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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 SUR-REPLY 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 83 Filed 04/21/21 Page 2 of 13 PageID #: 2700
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`I.
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`INTRODUCTION
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`Daiichi Sankyo Co., Ltd.’s reply brief confirms that this Court should deny its Motion to
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`Dismiss. This Court has personal jurisdiction over DSC. DSC does not dispute that Enhertu is
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`marketed and sold in Texas, and the evidence in the record—despite DSC’s continued
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`deficiencies—shows that DSC delivered Enhertu into the stream of commerce with the
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`expectation that it will be purchased by consumers in Texas. DSC’s self-serving declarations
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`and witness testimony do not defeat what the documents actually show: an intentional and
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`concerted effort to import, market, and sell Enhertu in this state. This Court also has subject
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`matter jurisdiction over Seagen’s claims. The asserted patent was issued before this case was
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`filed. DSC’s unsupported theory regarding the Uniform Time Act (“UTA”) is directly contrary
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`to every case that has ruled on this issue, including from this District.
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`II.
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`THIS COURT HAS PERSONAL JURISDICTION OVER DSC
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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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`DSC is subject to personal jurisdiction because it purposefully avails itself of this forum.
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`It imports the accused product, Enhertu, into the US, and places it into the stream of commerce
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`with the expectation and knowledge that it be available for purchase in Texas. See Semcon IP
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`Inc. v. TCT Mobile Int’l Ltd., No. 2:18-CV-00194-JRG, 2019 WL 2774362, at *3–4 (E.D. Tex.
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`July 2, 2019).
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`DSC does not dispute the following facts Seagen raised in its opposition (Opp’n at 9):
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`• DSC has conducted clinical trials for Enhertu at the University of Texas MD
`Anderson Cancer Center and the University of Texas Southwestern Medical
`Center, and has presented data and sponsored research relating to Enhertu at the
`last four San Antonio Breast Cancer Symposia in San Antonio, Texas. (Dkt. 67-6
`[Resp. to Rog. 5]; Dkt. 67-10.)
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`DSC claims Seagen’s “confusion” regarding whether DSC books sales of Enhertu in the
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`US relates to “ambiguous references to ‘Daiichi Sankyo’ in its cited publications.” (Reply at 6,
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`n.4.) These “cited publications” are DSC’s own publications, and in its press release, DSC quite
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`clearly defines “Daiichi Sankyo Company, Limited” as “Daiichi Sankyo.” (Dkt. 67-28 at 1.) In
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`any event, at the motion to dismiss stage, all factual disputes should be resolved in Seagen’s
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`favor. See Polar Electro Oy v. Suunto Oy, 829 F.3d 1343, 1347–48 (Fed. Cir. 2016).
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`DSC fails to distinguish Seagen’s cited authority. (Reply at 7.) In Polar Electro Oy, the
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`defendant would receive an order for a product, package the product at its facility in Finland, and
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`place the product on its shipping dock for a third-part shipper to pick up; the third-party shipper
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`would then deliver the order to a US address provided by and paid for by its US sister company.
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`Polar Electro Oy, 829 F.3d at 1346; see also Semcon, 2019 WL 2774362, at *1–2 (finding
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`jurisdiction over foreign parent despite the fact that the sale to its US subsidiary occurred in
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`China). DSC, on the other hand, does far more.
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`Case 2:20-cv-00337-JRG Document 83 Filed 04/21/21 Page 4 of 13 PageID #: 2702
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`though DSC may not ship commercial product directly to Texas,1 it does not merely place
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`Enhertu in the stream of commerce, with the Enhertu “fortuitously reaching” Texas. Polar
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`Electro Oy, 829 F.3d at 1351. Rather, DSC “act[s] in consort” with its wholly-owned subsidiary
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`DSI and third-party distributors to “deliberately and purposefully” ship products to Texas. See
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`Semcon, 2019 WL 2774362, at *4.
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`DSC’s continued citation to Bristol-Myers Squibb fails to establish DSC cannot be
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`subject to suit in Texas. (Reply at 6 (citing Bristol-Myers Squibb Co. v. Super. Ct., 137 S. Ct.
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`1773 (2017)).) As DSC even recognizes, “the particular issue before the Supreme Court [in
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`Bristol-Myers Squibb] was distinct from that here.” (Mot. at 15.) Bristol-Myers Squibb was a
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`personal injury case regarding Plavix where the court held no personal jurisdiction over BMS for
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`the claims brought by nonresidents of California. 137 S. Ct. at 1781. Seagen, on the other hand,
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`is being injured by DSC in Texas because Enhertu sold in Texas infringes the ’039 patent.
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`B.
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`This Court May Exercise Specific Personal Jurisdiction Over DSC Under
`Agency Theory
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`DSC does not dispute the many ways in which it controls its wholly-owned subsidiary,
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`DSI. (Opp’n at 13–15.)
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`contradicts the evidence of record, which must be viewed in Seagen’s favor.2
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` This self-serving testimony, however,
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`2 Where self-serving witness testimony “is in conflict with contemporaneous documents,” the
`testimony should be accorded less weight. Cf. United States v. U.S. Gypsum Co., 333 U.S. 364,
`396 (1948).
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`Case 2:20-cv-00337-JRG Document 83 Filed 04/21/21 Page 5 of 13 PageID #: 2703
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`Not so. DSC is involved in the importation process in numerous ways:
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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.)
`• DSC’s Senior Director of the Supply Chain Management Department “manage[s] the
`supply of bulk vials of Enhertu® to many different countries, including the United
`States.” (Id. ¶ 3.)
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` But a party need not be the “importer of record” to be the “importer.” See 19
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`C.F.R. § 101.1 (“‘Importer’ means the person primarily liable for the payment of any duties on
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`the merchandise, or an authorized agent acting on his behalf. The importer may be: (1) The
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`consignee, or (2) The importer of record, or (3) The actual owner of the merchandise . . . , or (4)
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`The transferee of the merchandise . . . .” (emphasis added)). Here, that is DSC. (See Dkt. 67-29
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`at 3 (Delivery Duty Paid defined as where “[t]he seller bears all the costs and risks involved in
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`bringing the goods to the place of destination and has an obligation to clear the goods not only
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`for export but also for import, to pay any duty for both export and import and to carry out all
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`customs formalities.”).)
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`Case 2:20-cv-00337-JRG Document 83 Filed 04/21/21 Page 6 of 13 PageID #: 2704
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`dispute of fact should be viewed in Seagen’s favor.
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` Again, this
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`Last, DSC fails to dispute that its agent, DSI, has systematic operations in Texas related
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`to Enhertu, supporting personal jurisdiction.
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`Case 2:20-cv-00337-JRG Document 83 Filed 04/21/21 Page 7 of 13 PageID #: 2705
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` Through DSI, personal jurisdiction
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`is proper as to DSC.
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`C.
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`This Court Has Specific Personal Jurisdiction Over DSC As An Indirect
`Infringer
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`DSC concedes that “the proper inquiry is whether the defendant intended infringement to
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`occur inside the forum . . . .” (Reply at 7 (citing Sitrick v. Freehand Sys., Inc., No. 02-cv-1568,
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`2004 WL 2191491, at *4 (N.D. Ill. Sept. 27, 2004)).) The evidence of record makes clear that
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`DSC intends acts to occur that result in infringement in Texas.
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` DSC also does not dispute that it actively encourages infringing sales in
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`Texas, acknowledging that the commercialization of Enhertu in Japan and the United States is
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`“[t]the most significant achievement during the current 5-year business plan period.” (Dkt. 67-
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`22 at 5.)
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`Further, DSC continues to refuse to produce documents identified in its 30(b)(6)
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`depositions that would show additional ties to Texas,
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`DSC’s authority, Sitrick, is an out-of-circuit district court opinion that found no personal
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`jurisdiction where the defendant’s connections with the forum state were far more tenuous than
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`those here. Sitrick, 2004 WL 2191491, at *3–4 (no personal jurisdiction where defendant (i) met
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`with investors in Illinois and (ii) “induced [co-defendant] to infringe Plaintiff’s patent.”). DSC
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`neither cites to nor attempts to distinguish Canon, in which this Court found specific jurisdiction
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`over foreign distributors because they—like DSC—“purposefully directed the Accused Products
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`to this forum, and the alleged infringement arises out of and/or relates thereto.” Canon, Inc. v.
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`TCL Elecs. Holdings Ltd., No. 2:18-CV-00546-JRG, 2020 WL 1478356, at *2–4 (E.D. Tex.
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`Mar. 25, 2020). As DSC encourages and enables DSI, as well as other third parties, to distribute
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`and sell Enhertu throughout Texas, it is subject to the personal jurisdiction of this Court.
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`D.
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`This Court Has Personal Jurisdiction Over DSC Under Rule 4(k)(2)
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`To the extent that DSC continues to argue that Seagen “cannot show that Daiichi Sankyo
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`Japan directed its actions to Texas ‘more than to any other state where the accused product is
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`sold’” (Reply at 7–8), Federal Rule of Civil Procedure 4(k)(2) provides an alternative basis for
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`personal jurisdiction. Recognizing the “extraordinary challenge in proving a negative many
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`times over,” the Federal Circuit has placed the burden of identifying a suitable forum where the
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`plaintiff could have brought suit on the defendant in order to defeat Rule 4(k)(2) jurisdiction.
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`Merial Ltd. v. Cipla Ltd., 681 F.3d 1283, 1294 (Fed. Cir. 2012) (internal quotations omitted)
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`(quoting Touchcom, Inc. v. Bereskin & Parr, 574 F.3d 1403, 1413 (Fed. Cir. 2009)). DSC has
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`not carried that burden.
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`In its reply, DSC does not dispute that its ex post consent by virtue of its concurrently
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`3 Seagen has also served subpoenas upon DSC’s third-party distributors in Texas. (Dkt. 68.)
`These documents will likely show additional ties to Texas.
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`Case 2:20-cv-00337-JRG Document 83 Filed 04/21/21 Page 9 of 13 PageID #: 2707
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`filed motion to transfer is insufficient to defeat 4(k)(2) jurisdiction. Rather, DSC avers that it
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`“consented to the jurisdiction of the District of Delaware, where it filed a lawsuit against SGI
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`before this lawsuit was filed.” (Reply at 10.) DSC does not explain—nor cite any case that
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`supports—how a case filed before the ’039 patent had even been issued results in consent to be
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`sued for patent infringement. Cf. Albany Int’l Corp. v. Yamauchi Corp., 978 F. Supp. 2d 138,
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`141–42, 146 (N.D.N.Y. Oct. 22, 2013) (declining Rule 4(k)(2) jurisdiction because the defendant
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`filed a mirror-image suit involving the same patents in California one day before the plaintiff
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`filed in New York). Accordingly, DSC has failed to identify a suitable alternative forum where
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`Seagen could have brought this action, and 4(k)(2) jurisdiction is therefore proper.
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`III. THIS COURT HAS SUBJECT MATTER JURISDICTION
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`At 12:00 AM Eastern Time on October 20, 2020, Seagen had the right to exclude all
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`others throughout the United States from practicing its patent. That is what the Patent Act
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`specifically says. A patent, when granted, gives a patentee the right “to exclude others from
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`making, using, offering for sale, or selling the invention throughout the United States . . . .” 35
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`U.S.C. § 154(a)(1) (emphasis added). DSC improperly frames the rights conferred by a patent as
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`the “right to enforce the patent . . . in this Court.” (Reply at 2 (emphasis added).) Per the
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`statutory language, on issuance, Seagen could enforce its patent rights by filing a lawsuit
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`anywhere in the United States. See GAF Bldg. Materials Corp. v. Elk Corp. of Dallas, 90 F.3d
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`479, 483 (Fed. Cir. 1996) (patents are effective “upon the formal issuance of the patent”).
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`DSC rewrites this grant such that a patentee could enforce a just-issued patent against a
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`nationwide infringer in a court in New York three hours before the same action could be filed in
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`California. This is not what Congress intended or the statute provides. And it is the Patent Act
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`that controls. See Crawford Fitting Co. v. J.T. Gibbons, Inc., 482 U.S. 437, 445 (1987),
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`superseded on other grounds (“As always, where there is no clear intention otherwise, a specific
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`Case 2:20-cv-00337-JRG Document 83 Filed 04/21/21 Page 10 of 13 PageID #: 2708
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`statute will not be controlled or nullified by a general one . . . .” (internal quotations omitted)).
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`The UTA does not require otherwise. In the context of the statute, “the time of
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`performance of any act by any officer or department of the United States” is when the Patent
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`Office issued the ’039 patent—at 12:00 AM Eastern Time on October 20, 2020. 15 U.S.C. §
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`262. “[T]he time within which any rights shall accrue” likewise occurred at 12:00 AM Eastern
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`Time, when Seagen was granted the right to exclude all others throughout the United States from
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`practicing the ’039 patent. Id.; 35 U.S.C. § 154(a)(1). DSC ignores this more consistent reading
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`of the two statutes, opting instead to focus on “when a court may exercise jurisdiction over
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`infringement claims.” (Reply at 4.) After two rounds of briefing, DSC cites to no cases that
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`support its position because there is none.
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`Seagen, by contrast, has cited to numerous decisions—including one from this District—
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`that hold absolute time is the only correct measure for patent infringement actions. NobelBiz,
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`Inc. v. Global Connect, L.L.C., No. 6:13-cv-804-MHS, 2014 WL 12613389, at *2–3 (E.D. Tex.
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`Feb. 26, 2014) (finding subject matter jurisdiction over patent claims when filed after the patent
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`was issued in absolute time); Cerro Wire Inc. v. Southwire Co., 777 F. Supp. 2d 1334, 1338
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`(N.D. Ga. Mar. 4, 2011) (same); Encore Wire Corp. v. Southwire Co., No. 3:10-cv-86-BMGL,
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`2011 WL 833220, at *4 (N.D. Ga. Mar. 4, 2011) (same). DSC does not even attempt to address
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`or distinguish these cases, opting instead to hand-wave that “[it is not] persuasive that prior
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`courts have assessed when the right to sue for patent infringement accrues without considering
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`the [UTA].”4 (Reply at 4.) That these decisions did not address the UTA only highlights that the
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`statute does not require otherwise.
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`DSC’s analogy regarding filing tax returns is inapposite. (Id.) Seagen has never argued
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`4 DSC dismisses NobelBiz similarly in its moving papers. (See Mot. at 10–11.)
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`Case 2:20-cv-00337-JRG Document 83 Filed 04/21/21 Page 11 of 13 PageID #: 2709
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`that reconciling federal statutes to local time zones is uncommon or bad policy. Rather, DSC has
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`not shown how the UTA mandates the piecemeal grant it proposes. DSC’s imagined chaos for
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`taxpayers in Hawaii “scrambling to file their returns by 6:00 pm” is not a risk of holding that
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`nationwide patent rights are granted in absolute time. (Reply at 4.) Filing tax returns involves
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`the independent acts of hundreds of millions of US taxpayers spread across multiple time zones.
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`This is unlike the grant of a patent, where a single patentee is granted the right to exclude all
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`others throughout the US from practicing its patent.
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`IV. CONCLUSION
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`This Court should deny DSC’s motion to dismiss for lack of subject matter jurisdiction
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`and lack of personal jurisdiction.
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`Case 2:20-cv-00337-JRG Document 83 Filed 04/21/21 Page 12 of 13 PageID #: 2710
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`Dated: April 15, 2021
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`By: /s/ Michael A. Jacobs
`Michael A. Jacobs
`MJacobs@mofo.com
`Matthew A. Chivvis
`MChivvis@mofo.com
`MORRISON & FOERSTER LLP
`425 Market Street
`San Francisco, CA 94105
`Telephone: 415.268.7000
`Facsimile: 415.268.7522
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`Bryan Wilson
`BWilson@mofo.com
`Pieter S. de Ganon
`PdeGanon@mofo.com
`MORRISON & FOERSTER LLP
`755 Page Mill Road
`Palo Alto, California 94304-1018
`Telephone: 650.813.5600
`Facsimile: 650.494.0792
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`Melissa R. Smith
`Texas State Bar No. 24001351
`melissa@gillamsmithlaw.com
`GILLAM & SMITH, LLP
`303 South Washington Avenue
`Marshall, Texas 75670
`Telephone: 903.934.8450
`Facsimile: 903.934.9257
`Of Counsel:
`T. John Ward, Jr.
`Texas State Bar No. 00794818
`jw@wsfirm.com
`Charles Everingham IV
`Texas State Bar No. 00787447
`ce@wsfirm.com
`Andrea L. Fair
`Texas State Bar No. 24078488
`andrea@wsfirm.com
`WARD, SMITH & HILL, PLLC
`1507 Bill Owens Parkway
`Longview, Texas 75604
`Telephone: 903.757.6400
`Facsimile: 903.757.2323
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`Attorneys for Plaintiff Seagen Inc.
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`CERTIFICATE OF SERVICE
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`The undersigned certifies that the foregoing document was filed electronically in
`compliance with Local Rule CV-5(a). All counsel of record were served with a true and correct
`copy of the foregoing document by electronic mail on April 15, 2021.
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`/s/ Melissa R. Smith
`Melissa R. Smith
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