United States District Court, D. Massachusetts
ASTELLAS INSTITUTE FOR REGENERATIVE MEDICINE, et al., Plaintiffs,
IMSTEM BIOTECHNOLOGY, INC., et al., Defendants.
MEMORANDUM AND ORDER ON MOTION TO DISMISS
ALLISON D. BURROUGHS U.S. DISTRICT JUDGE
Astellas Institute for Regenerative Medicine and Stem Cell
& Regenerative Medicine International, Inc.
(collectively, “Plaintiffs”) filed this action
against Defendants ImStem Biotechnology, Inc., Xiaofang Wang,
and Ren-He Xu (collectively, “Defendants”)
alleging claims for correction of inventorship under 35
U.S.C. § 256, unfair trade practices under Massachusetts
General Laws Chapter 93A, conversion, unjust enrichment,
misappropriation of trade secrets, and negligent
misrepresentation. [Dkt. No. 1]. Defendants ImStem
Biotechnology, Inc. and Xiaofang Wang (collectively,
“Counterclaim Defendants”) brought counterclaims
against Plaintiffs for correction of inventorship under 35
U.S.C. § 256 and unjust enrichment. [Dkt. No. 20
(“Counterclaim Complaint”)]. Plaintiffs moved to
dismiss the counterclaims pursuant to Federal Rule of Civil
Procedure 12(b)(6). [Dkt. No. 21]. For the reasons set forth
below, Plaintiffs' motion to dismiss is DENIED.
following facts are drawn from the Counterclaim Complaint,
the well-pleaded allegations of which are taken as true for
purposes of evaluating Plaintiffs' motion to dismiss.
See Ruivo v. Wells Fargo Bank, 766 F.3d 87, 90 (1st
Astellas Institute for Regenerative Medicine is a Delaware
corporation with a principal place of business in
Marlborough, Massachusetts. [Dkt. No. 20, Countercl. ¶
6]. Plaintiff Stem Cell & Regenerative Medicine
International, Inc. (“SCRMI”) is a Delaware
corporation with a principal place of business in
Marlborough, Massachusetts. [Id. ¶ 7].
Defendant ImStem Biotechnology Inc. (“ImStem”) is
a biotechnology company with a principal place of business in
Farmington, Connecticut. [Id. ¶ 4].
Counterclaim Defendant Dr. Xiofang Wang is the Chief
Technology Officer, Vice President, and a founder of ImStem.
[Id. ¶ 5]. Dr. Wang is a research scientist
with experience in the field of autoimmune disease and, in
particular, he has studied the genetic mechanism for
autoimmune disease in the experimental autoimmune
encephalopathy (“EAE”) mouse model for multiple
sclerosis. [Id. ¶ 15].
Dr. Ren-He Xu was Dr. Wang's research mentor.
[Id. ¶ 16]. In July 2010, Dr. Xu met with Dr.
Shi-Jiang Lu, a colleague who worked at SCRMI, to discuss Dr.
Wang's work. [Id. ¶ 16-17]. Dr. Lu
suggested that Dr. Wang get in touch with his SCRMI
colleagues, Drs. Erin Kimbrel and Robert Lanza, to discuss a
collaboration involving mesenchymal stem cells
(“MSCs”) derived from hemangioblast cells.
[Id. ¶ 17]. MSCs are a type of stem cell that
are useful in treating a variety of disorders. [Dkt. 20,
Answer ¶ 1]. Hemangioblast-derived MSCs are created by
first generating hemangioblasts from embryonic stem cells and
then differentiating the hemangioblasts into MSCs. [Dkt. 20,
Countercl. ¶ 25].
initial email exchange with Drs. Kimbrel and Lanza, Dr. Wang
suggested that hemangioblast-derived MSCs could be used to
treat autoimmune diseases, and proposed that their
collaboration focus on using the EAE mouse model to test the
effectiveness of MSCs to treat autoimmune diseases like
multiple sclerosis. [Id. ¶¶2, 18, 33]. At
that time, Drs. Kimbrel and Lanza were not familiar with the
EAE mouse model or the potential to use hemangioblast-derived
MSCs to treat autoimmune diseases. [Id. ¶¶
19-20, 32]. In August 2010, the parties agreed to collaborate
and, over the course of their collaboration, Dr. Wang
conducted experiments involving hemangioblast-derived MSCs on
the EAE mouse model. [Id. ¶¶ 23-24]. Dr.
Wang's experiments yielded promising results, and Drs.
Kimbrel, Lanza, Wang, and Xu worked together to publish this
data in a scientific journal. Xiofang Wang et al., Human
ESC-Derived MSCs Outperform Bone Marrow MSCs in the Treatment
of an EAE Model of Multiple Sclerosis, 3 Stem Cell
Reports 115 (2014) (the “Joint Publication”)
November 30, 2011, Drs. Kimbrel and Lanza filed Provisional
Patent Application No. 61/565, 358 with the U.S. Patent and
Trademark Office (“PTO”). This patent application
incorporated data from the experiments that Dr. Wang had
conducted during the parties' collaboration. [Dkt. 20,
Countercl. ¶ 26]. On February 24, 2015, the PTO issued
U.S. Patent No. 8, 961, 956 (the “‘956
patent”), entitled “Mesenchymal Stromal Cells and
Uses Related Thereto, ” and naming, inter
alia, Drs. Kimbrel and Lanza as joint inventors. [Dkt.
No. 20-1]. The ‘956 patent does not name Dr. Wang as a
August 29, 2017, the PTO issued U.S. Patent No. 9, 745, 551
(the “‘551 patent”), entitled
“Mesenchymal-Like Stem Cells Derived from Human
Embryonic Stem Cells, Methods and Uses Thereof, ” and
naming Drs. Wang and Xu as joint inventors. [Dkt. No. 1-1].
The ‘551 patent does not name Drs. Kimbrel and Lanza as
joint inventors. On November 13, 2017, Plaintiffs filed suit
against Defendants, seeking a correction of inventorship on
the ‘551 patent and other state law remedies. [Dkt. No.
1]. On January 10, 2018, the Counterclaim Defendants filed
their Answer and the Counterclaim Complaint, asserting claims
for correction of inventorship of the ‘956 patent and
unjust enrichment. [Dkt. No. 20]. On January 31, 2018,
Plaintiffs moved to dismiss the Counterclaim Complaint. [Dkt.
STANDARD OF REVIEW
motion to dismiss for failure to state a claim, the Court
accepts as true all well-pleaded facts in the complaint and
draws all reasonable inferences in the light most favorable
to the plaintiff. United States ex rel. Hutcheson v.
Blackstone Med., Inc., 647 F.3d 377, 383 (1st Cir.
2011). While detailed factual allegations are not required,
the complaint must set forth “more than labels and
conclusions, ” Bell Atl. Corp. v. Twombly, 550
U.S. 544, 555 (2007), and it must contain “factual
allegations, either direct or inferential, respecting each
material element necessary to sustain recovery under some
actionable legal theory.” Gagliardi v.
Sullivan, 513 F.3d 301, 305 (1st Cir. 2008) (internal
quotations and citations omitted). The facts alleged, taken
together, must “state a claim to relief that is
plausible on its face.” A.G. ex rel. Maddox v.
Elsevier, Inc., 732 F.3d 77, 80 (1st Cir. 2013) (quoting
Twombly, 550 U.S. at 570). “A claim is
facially plausible if supported by ‘factual content
that allows the court to draw the reasonable inference that
the defendant is liable for the misconduct
alleged.'” Eldredge v. Town of
Falmouth, MA, 662 F.3d 100, 104 (1st Cir. 2011)
(quoting Ashcroft v. Iqbal, 556 U.S. 662, 678
assessing the sufficiency of a complaint, the Court first
“separate[s] the complaint's factual allegations
(which must be accepted as true) from its conclusory legal
allegations (which need not be credited).”
Maddox, 732 F.3d at 80 (quoting Morales-Cruz v.
Univ. of P.R., 676 F.3d 220, 224 (1st Cir. 2012)). Next,
the Court “determine[s] whether the remaining factual
content allows a ‘reasonable inference that the
defendant is liable for the misconduct alleged.'”
Id. (quoting Morales-Cruz, 676 F.3d at
224). “[T]he court may not disregard properly pled
factual allegations, ‘even if it strikes a savvy judge
that actual proof of those facts is improbable.'”
Ocasio-Hernandez v. Fortuño-Burset, 640 F.3d
1, 12 (1st Cir. 2011) (quoting Twombly, 550 U.S. at
556). “[W]here the well-pleaded facts do not permit the
court to infer more than the mere possibility of misconduct,
” however, a claim may be dismissed. Iqbal,
556 U.S. at 679.