Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Children's Medical Center Corp. v. Celgene Corp.

United States District Court, D. Massachusetts

September 30, 2016




         This case concerns an Exclusive License Agreement (the "Agreement") under which Celgene Corporation ("Celgene") agreed to pay royalties on certain drug sales to Children's Medical Center Corporation ("CCMC") in return for exclusive rights to a portfolio of CMCC patents. CMCC filed a complaint in Suffolk Superior Court for the Commonwealth of Massachusetts alleging that Celgene had wrongfully ceased to pay royalties on two drugs subject to the agreement. Celgene timely removed the case to federal court. The case was assigned to this court and referred to Magistrate Judge Judy Dein for pretrial purposes.

         CMCC moved for summary judgment. After holding a hearing on the motion, Magistrate Judge Dein issued a report recommending that CMCC's motion for summary judgment be allowed with respect to royalty payments for one drug, Revlimid®, and denied with respect to another, Pomalyst®. She also recommended that CMCC's motion for summary judgment be allowed as to Celgene's defense of patent misuse with respect to Revlimid® and denied with respect to all other products.

         For the reasons explained below, the Magistrate Judge's Report and Recommendation is being adopted in part and modified in part. On de novo review, the court finds that the Agreement is unambiguous as to Celgene's obligation to pay royalties on sales of Revlimid® and ambiguous as to its obligation to pay royalties on sales on Pomalyst®. However, the court finds that there are material disputes of fact that preclude summary judgment on the issue of patent misuse. CMCC's motion for summary judgment is, therefore, being allowed with respect to the construction of the Revimid royalty provision and denied in all other respects.

         I. BACKGROUND

         The court adopts the facts as recited in the Magistrate Judge's Report and Recommendation. See R&R at 2-7. The essential facts may be summarized as follows.

         CMCC is the owner of several patents for chemical compounds known as Thalidomide Analogs (collectively, the "Analog Patents"). On December 31, 2002, CMCC granted Celgene an exclusive, worldwide license to the Analog Patents. See Agreement §2.1. In return Celgene agreed, among other things, to pay CMCC royalties on sales of products containing Thalidomide Analogs. See id. §4.3. Those products were divided into three categories: Amino Thalidomide Products, Revimid Products, and other Licensed Products. See id. Each category of product was covered by a separate royalty provision. Each such provision specified an end date of "later of the termination of this Agreement or March 1, 2013." See id. Additionally, the Amino Thalidomide and Revimid royalties end dates were to be extended by "the number of days equivalent to any patent term extension granted to Celgene for [a relevant product] under 35 U.S.C. §156 with respect to March 1, 2013 only." See id. §§4.3.1 & 4.3.2. On January 25, 2007, CMCC assigned its interest in the royalty payments to defendant CR Rev Holdings LLC.

         On March 27, 2008, Celgene obtained a patent term extension ("PTE") for one its own patents on Revlimid®, a Revimid Product (the "Revlimid PTE"). On March 1, 2013, Celgene ceased paying royalties on its Amino Thalidomide and Revimid Products. CMCC sought further payments, asserting that the Revlimid PTE extended the period for which is could collect royalties. Celgene declined to pay additional royalties. The following month, CMCC filed this instant case, alleging breach of contract and breach of the implied covenant of good faith and fair dealing. After removing the case to federal court, Celgene answered the complaint. Among other things, it asserted a defense of patent misuse. CMCC has moved for summary judgment on its breach of contract claim.


         A. Review of a Magistrate's Disposition

         Rule 72(b)(3) of the Federal Rules of Civil Procedure requires the court to review "de novo any part of the magistrate judge's disposition that has been properly objected to." "Conclusory objections that do not direct the reviewing court to the issues in controversy" are not proper under Rule 72(b). Velez-Padro v. Thermo King De Puerto Rico, Inc., 465 F.3d 31, 32 (1st Cir. 2006). Moreover, "[a party is] not entitled to a de novo review of an argument never raised" before the magistrate judge. Borden v. Sec'y of Health & Human Servs., 836 F.2d 4, 6 (1st Cir. 1987). "Parties must take before the magistrate, 'not only their best shot but all of their shots.'" Id. (quoting Singh v. Superintending Sch. Comm. of City of Portland, 593 F.Supp. 1315, 1318 (D. Me. 1984).

         Waiver of de novo review by failing to file proper objections does not entitle a party to "some lesser standard" of review. Thomas v. Arn, 474 U.S. 140, 149-50 (1985); see also Costa v. Hall, No. 00-12213-MLW, 2010 WL 5018159, at *17 (D. Mass. Dec.2, 2010) ("Absent objections, the court may adopt the report and recommendation of the magistrate judge."). However, review by the court in such circumstances is not prohibited, and some level of oversight, even if not de novo, is encouraged. See Henderson v. Carlson, 812 F.2d 874, 878 (3rd Cir. 1987).

         B. Summary Judgment

         Federal Rule of Civil Procedure 56 allows a party to move for judgment on all or part of a claim or defense at issue in a case. Rule 56(a) provides that the court "shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." A fact is "material" if, in light of the relevant substantive law, "it has the potential of determining the outcome of the litigation." Maymi v. Puerto Rico Ports Auth., 515 F.3d 20, 25 (1st Cir. 2008). A factual dispute is "genuine" if "'the evidence is such that a reasonable jury could return a verdict for the nonmoving party.'" Chadwick v. WellPoint, Inc., 561 F.3d 38, 43 (1st Cir. 2009) (quoting Anderson, 477 U.S. at 248). In making this determination, the court must "constru[e] the record in the light most favorable to the non-moving party." Douglas v. York Cnty., 433 F.3d 143, 149 (1st Cir. 2005). The record should not, however, be scrutinized ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.