UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK
IN RE NAMENDA DIRECT PURCHASER
ANTITRUST LITIGATION
No.: 1:15-CV-07488-CM-RWL
MEMORANDUM OF LAW IN SUPPORT OF DIRECT PURCHASER PLAINTIFFS’
MOTION TO ENFORCE FOREST’S ELECTION AGAINST RELYING ON ITS
SUBJECTIVE BELIEFS AND TO PRECLUDE AN ELEVENTH-HOUR CHANGE
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TABLE OF CONTENTS
I. INTRODUCTION .................................................................................................................. 1
II. SUMMARY OF ARGUMENT .............................................................................................. 1
III. FACTUAL BACKGROUND .............................................................................................. 4
A. Forest Elected to Forego Assertion of Its Subjective Beliefs in Response to a
Court Order Requiring the Election. ...................................................................... 4
B. Consistent with Its Election, Forest Refused to Disclose Its Subjective Beliefs on
Various Issues Throughout the Fact Discovery Period. ......................................... 5
1. Deposition Testimony ................................................................................. 5
2. Interrogatories ........................................................................................... 10
3. Document Requests .................................................................................. 11
C. Forest’s Post-Discovery Gamesmanship .............................................................. 12
IV. ARGUMENT ..................................................................................................................... 14
A. Forest Cannot Offer “Subjective Belief” Evidence that Is Contrary to Its Election
or that Was Withheld During Discovery ............................................................... 14
1. The Court-Ordered Disclosure Binds Forest ............................................ 14
2. Forest Cannot Withhold Evidence as Privileged During Discovery But
Then Introduce the Withheld Evidence at Trial ........................................ 15
B. Plaintiffs Would Suffer Undue Prejudice by an Eleventh-Hour Waiver............... 18
V. CONCLUSION ..................................................................................................................... 19
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TABLE OF AUTHORITIES
Cases Page(s)
Fed. Trade Comm’n v. Actavis, Inc.,
No. 1:09-CV-955-TWT (N.D. Ga. Feb. 26, 2019) (ECF No. 855) .......................................... 17
Ginns v. Towle,
361 F.2d 798 (2d Cir. 1966)................................................................................................ 15, 16
Guglielmo v. Kopald,
No. 05-cv-7887 (CLB), 2007 U.S. Dist. LEXIS 46558 (S.D.N.Y. June 26, 2007) .................. 16
In re Lidoderm Antitrust Litig.,
No. 14-md-02521-WHO, 2016 U.S. Dist. LEXIS 105619 (N.D. Cal. Aug. 9, 2016) ........... 4,16
In re Lidoderm Antitrust Litig.,
No. 14-md-02521-WHO (N.D. Cal. July 17, 2017) (ECF No. 795) ........................................ 15
In re Namenda Direct Purchaser Antitrust Litig.,
No. 15-cv-7488, 2017 U.S. Dist. LEXIS 76675 (S.D.N.Y. May 19, 2017) ............................. 16
Regeneron Pharm., Inc. v. Merus B.V.,
144 F. Supp. 3d 530 (S.D.N.Y. 2015)................................................................................. 16, 19
Union Pac. R. Co. v. Colony Nat’l Ins. Co.,
No. 8:13CV84, 2016 U.S. Dist. LEXIS 122701 (D. Neb. Sept. 9, 2016) ................................ 17
United States v. 4003-4005 5th Ave.,
55 F.3d 78 (2d Cir. 1995).......................................................................................................... 16
UnitedHealth Grp. Inc. v. Columbia Cas. Co.,
47 F. Supp. 3d 863 (D. Minn. 2014) ......................................................................................... 17
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Direct Purchaser Plaintiffs (“Plaintiffs”) respectfully bring this motion to estop Forest
Laboratories, Inc. (“Forest”) from conducting “trial by ambush” by introducing its subjective
beliefs on various topics after (1) electing, pursuant to a court order, to disavow reliance upon
them; and then (2) withholding discovery on them based on the invocation of privilege.
I. INTRODUCTION
In this antitrust case, Plaintiffs allege that Forest improperly settled a patent infringement
case involving United States Patent No. 5,061,703 (the “‘703 Patent”) by paying a would-be
competitor, Mylan Pharmaceuticals Inc. (“Mylan”), to delay marketing its generic version of the
drug product Namenda IR (“Namenda”). Throughout discovery, Plaintiffs sought evidence of
Forest’s subjective beliefs on various topics, including its beliefs about the merits of the ‘703
Patent litigation and whether the agreed-upon date for Mylan’s entry reflected Forest’s subjective
views of those merits. Following extensive motion practice, this Court ordered Forest to elect
whether it would (1) rely upon its subjective beliefs and thereby waive privilege, or, in the
alternative (2) forego reliance on its subjective beliefs and thereby maintain privilege. Forest
elected the latter. Thereafter, Forest repeatedly asserted privilege to block discovery into its
subjective beliefs that were informed by attorney communications or work product. Plaintiffs now
wish to prevent an ambush at trial when Forest reverses course and tries — as it has indicated it
will — to offer witness testimony on the very same subjective beliefs that it elected not to rely
upon and then withheld from discovery on the basis of privilege.
II. SUMMARY OF ARGUMENT
For two reasons, this Court should preclude Forest from offering evidence of its subjective
beliefs, particularly those relating to the patent litigation merits and whether Mylan’s agreed entry
date reflected Forest’s subjective views of those merits.
First, in response to the Court’s order requiring an election, Forest declined “to waive any
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attorney-client privilege or attorney work product protections” and therefore stated that it “does
not intend to affirmatively rely on its subjective beliefs to rebut any argument that . . . its position
in the patent case was weak.” Ex. 1,1 Forest’s Disclosure Pursuant to the May 19, 2017
Memorandum and Order (hereinafter “Disclosure”) at 2, 5. In its election, Forest identified just
three topics,2 all unrelated to the strength or weakness of its patent, for which it would rely on
“subjective beliefs,” and represented in a subsequent email that it “will not rely on any subjective
beliefs beyond those outlined in its [election].” ECF No. 281-2 (June 22, 2017) at 3 (pagination in
ECF). And in later briefing, Forest again reminded the Court that it was “committing to rely on
subjective beliefs for only three narrow topics.” ECF No. 282 (June 22, 2017) at 3. Forest should
be held to its election and representations, which Plaintiffs relied upon in readying this case for
trial.
Second, following its election, and in compliance therewith, Forest refused to allow
discovery into its subjective beliefs concerning the merits of its patent litigation or the basis for
the agreed-upon dates for generic entry in its settlement agreements with the various generic
manufacturers. For example, Forest’s attorneys instructed Forest’s former chief patent counsel not
to disclose his “assessment of the strengths of the arguments that Mylan was making in the
1 References to exhibits herein are to the exhibits to the Declaration of Dan Litvin accompanying
this memorandum.
2 These were Forest’s contentions that (1) its Lexapro agreement with Mylan was not “motivated
by illegitimate or anti-competitive justifications”; (2) that Forest’s “conduct with respect to the
Namenda patent litigations was [nothing] but routine behavior under the Hatch-Waxman regime”;
and (3) “that the Namenda IR patent litigation settlement agreements provided the generic
competitors [no] consideration beyond the express terms of each of the final agreements, including,
inter alia, licensed early entry for generic ANDA product and, for certain settled defendants,
avoided litigation expense payments.” Ex. 1, Disclosure at 4-5. Forest emphasized that its
subjective evidence would not implicate the patent litigation. See Ex. 1, Disclosure at 4 (Forest
would elicit evidence of its agreements’ “independence from the then-pending patent litigations
and respective settlement agreements”).
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Namenda patent litigation.” Ex. 2, Ryan (Sept. 7, 2017) Dep. at 37:8-16. Indeed, after refusing to
answer a battery of similar questions, he testified that he did not have any “non-privileged
information” about “Forest’s view as to the strengths of the ‘703 patent” or “Forest’s beliefs of the
merits of the Namenda patent litigation.” Id. at 43:1-12. Forest likewise instructed the corporate
representative for its partner, Merz, not to disclose what Forest told it about the patent litigation’s
merits (see Ex. 3, Jochum (August 30, 2017) Dep. – see infra), and prevented Plaintiffs from
exploring and testing Forest’s self-serving assertion that it would not have agreed to earlier generic
entry. For instance, Forest admitted that attorney advice informed its “position with respect to the
launch date that they would agree to” (Ex. 4, Agovino (Sept. 12, 2017) Dep. – see infra), yet
Forest’s counsel refused to let the witness disclose what that advice was. After having blocked all
inquiry into these topics during discovery, Forest should not be allowed to ambush Plaintiffs with
them at trial.
As this Court previously ruled, Forest’s assertion of subjective beliefs informed by attorney
advice would require it to produce otherwise-privileged documents and testimony relating to those
beliefs. ECF No. 249 (May 19, 2017) at 14-15 (“[I]t is Forest’s burden to establish that it has not
waived privilege . . . Forest will have to back up with argument and evidence any contention as to
why the ‘subjective beliefs’ on which it plans to rely do not, in fact, implicate privileged
communications based on the guidelines applied in Lidoderm and similar cases.”). Forest has
withheld roughly 15,000 responsive documents on the basis of privilege, and has refused to fully
answer interrogatories and deposition questions relating to its subjective beliefs. Forest should not
be permitted to derail this litigation by disavowing and revising its election long after discovery
has closed and the case is nearing trial. A Forest about-face, if permitted, would require Plaintiffs
to seek a new round of document production (likely including extensive in camera document
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review), interrogatory responses, and depositions.
Plaintiffs wrote to Forest seeking assurances – through a stipulation – that Forest would (1)
abide by its court-ordered election; and (2) adhere to its discovery decisions by not seeking to
introduce evidence at trial that had been withheld during the fact discovery period. Ex. 5, March
11, 2019 Ltr. and Stipulation. Forest declined Plaintiffs’ request that Forest honor its prior
commitments to the Court.
III. FACTUAL BACKGROUND
A. Forest Elected to Forego Assertion of Its Subjective Beliefs in Response to a
Court Order Requiring the Election.
On April 12, 2017, Plaintiffs filed a motion to compel the production of documents based,
in part, on an assertion of an “at issue” privilege waiver. ECF No. 197 (April 12, 2017). In
response, Forest argued that it had not yet waived privilege and impliedly invited the Court to
follow In re Lidoderm Antitrust Litig. by ordering it to elect those “subjective beliefs” on which it
would rely:
Plaintiffs’ reliance on Lidoderm here is misplaced, as that decision set forth a
framework for analysis that Plaintiffs seem to want this Court to skip. Indeed, far
from issuing a blanket order on waiver, in Lidoderm . . . the court actually ordered
defendants to expressly identify a specific list of all “subjective beliefs that they
intend[ed] to introduce or rely on at trial” related to the underlying patent settlement
agreements.
ECF No. 232 (May 3, 2017) at 15 (citing In re Lidoderm Antitrust Litig., No. 14-md-02521-WHO,
2016 U.S. Dist. LEXIS 105619, at *38 (N.D. Cal. Aug. 9, 2016)). On May 19, 2017, the Court
accepted Forest’s invitation and ordered Forest to “disclose any subjective beliefs it will rely on in
its defense of this action within two weeks[.]” ECF No. 249 at 14.
On June 2, 2017, Forest submitted its Disclosure identifying three “subjective beliefs” on
which it intended to rely: (A) “business justifications for the Mylan and Orchid business
agreements”; (B) “general experience with ANDAs, generic manufacturers, and patent
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litigations”; and (C) “terms of the agreed upon Namenda IR patent litigation settlements.” Ex. 1,
Disclosure at 4-5. Forest also identified four “subjective beliefs” upon which it would not rely:
. . . . Forest does not intend to affirmatively rely on its subjective beliefs to rebut
any argument that (1) its position in the patent case was weak, (2) any alleged
payment to the generic competitors was “large,” (3) Forest acted in “good faith,”
and (4) the settlement agreements were not “bona fide” and not “for fair value.”
Instead, to the extent necessary, Forest intends to rely on objective evidence to rebut
(1) – (4) . . .
Id. at 5-6 (emphasis added).
In a subsequent email exchange, Forest reaffirmed that it would “not rely on any subjective
beliefs beyond those outlined in its Disclosure”:
Forest will rely on objective evidence that does not waive any privilege or
protection to support its position on certain affirmative defenses and will not rely
on any subjective beliefs beyond those outlined in its Disclosure. Forest believes
this approach is in line with Second Circuit case law and Judge Francis’s order.
ECF No. 281-2 (June 22, 2017) at 3 (emphasis added); see also ECF No. 282 (June 22, 2017) at
4. Forest then reiterated to the Court that it was “committing” to rely on its “subjective beliefs for
only three narrow topics,” listed above, and that “as set forth in its Disclosure, Forest does not
intend to rely on subjective beliefs that were informed by attorney-client communications.” ECF
No. 282 (June 22, 2017) at 3, 9.
B. Consistent with Its Election, Forest Refused to Disclose Its Subjective Beliefs on
Various Issues Throughout the Fact Discovery Period.
Throughout discovery, Forest relied explicitly on its Disclosure to refuse to produce
evidence concerning its subjective beliefs of the merits of its patent cases.
1. Deposition Testimony
Forest instructed not only its own witnesses, but also the witness of its German partner
Merz Pharma GmbH & Co. KGaA (“Merz”), to refrain from divulging Forest’s subjective beliefs
about the merits of the patent or patent litigation.
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(a) Forest Rule 30(b)(6) Witness Charles Ryan
Charles Ryan testified as a corporate representative for Forest under Rule 30(b)(6) on
September 7, 2017, one week before the close of fact discovery. Ex. 2, Ryan (Sept. 7, 2017) Dep.
at 9:12-10:22. During the Namenda patent litigation (between 2008 and 2010), Dr. Ryan was Chief
Intellectual Property Counsel at Forest, was “responsible for assessing the merits” of the generics’
patent defenses, and did in fact “reach . . . conclusion[s] about the merits” of those defenses. Id. at
20:11-21:17, 31:1-9. However, consistent with Forest’s election not to assert certain subjective
beliefs informed by attorney advice, counsel instructed Dr. Ryan not to disclose his conclusions
about the merits of those defenses. Id. at 32:10-18.
Defense counsel then blocked Dr. Ryan from disclosing his assessment of the strengths of
Mylan’s arguments in the patent litigation:
Q. What was your assessment of the strengths of the arguments that Mylan was
making in the Namenda patent litigation?
MR. JOHNSON: And I’ll instruct you not to answer that question, Dr. Ryan,
on grounds of privilege and work product.
Q. Are you going to follow your counsel’s instruction?
A. Yes.
Id. at 37:8-16. Defense counsel also instructed Dr. Ryan not to answer the following questions:
Q. At the time of the Mylan settlement, what did you believe was Forest’s
overall likelihood of success in the case of Mylan relating to the ‘703
patent? (Id. at 38:16-39:1)
Q. At the time of settlement of the Namenda patent litigation, did you believe
that there were any weaknesses in Mylan’s invalidity defense? (Id. at 39:2-
23)
Q. At the time of the Mylan settlement, did you believe there were any
weaknesses in Mylan’s non-infringement defense? (Id. at 39:24-40:9)
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Q. At the time of the Mylan settlement, what did you believe was Forest’s
likelihood of success as to Mylan’s argument with respect to the patent term
extension? (Id. at 40:10-25)
Q. How strong did you believe the ‘703 patent was in terms of its ability to
exclude potential competitors from marketing generic Namenda products?
(Id. at 41:1-12)
Q. Were beliefs about the strength of the ‘703 patent one of the factors that
Forest considered when deciding to settle the Namenda patent litigation?
(Id. at 41:13-23)
Q. And were beliefs of the strength of the ‘703 patent one of the factors Forest
considered when negotiating the terms of the settlement of the Namenda
patent litigation? (Id. at 41:24-42:10)
Q. In your view, does the final settlement agreement between Forest and Mylan
in any way reflect Forest’s assessment of patent merits of the Namenda
patent litigation? (Id. at 42:11-25)
Dr. Ryan ultimately testified (again, as Forest’s corporate representative) that Forest has
no non-privileged information concerning the patent merits:
Q. Do you have any non-privileged information about Forest’s view as to the
strengths of the ‘703 patent?
MR. JOHNSON: Non-privileged information regarding the strength of the
patent, you can answer.
A. That’s not privileged? I think I probably have to answer no.
Q. Do you have any non-privileged information about Forest’s beliefs of the
merits of the Namenda patent litigation?
A. No.
Id. at 43:1-12. Clearly, Forest blocked Plaintiffs from learning any information concerning Forest’s
subjective beliefs about the merits of the patent litigation and the strength of its patent, as well as
the bases for those beliefs.
(b) Merz Rule 30(b)(6) Witness Patrick Jochum
On August 30, 2017, Patrick Jochum testified as a corporate representative for Merz. Ex.
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3, Jochum (Aug. 30, 2017) Dep. at 7:24-8:8; 12:15-25. Not only Merz’s counsel Mr. Cerrito but
also Forest’s counsel Mr. Johnson instructed Mr. Jochum not to answer questions relating to
Forest’s subjective beliefs about the likelihood of success and merits of the patent litigation:
Q. What did Forest tell Merz regarding its beliefs about the likelihood of
success in the Namenda IR patent litigation?
MR. CERRITO: Same instruction [not to answer based on attorney-client
privilege, attorney work product, joint defense privilege.]
Q. Are you following that instruction?
MR. JOHNSON: Same here as well.
A. I am following this instruction.
Q. What did Forest tell Merz regarding its beliefs about the merits of the
Namenda IR patent litigation?
MR. CERRITO: Same instruction.
MR. JOHNSON: Same instruction.
A. I’m following this instruction.
Id. at 140:11-141:23.
At the same deposition, Merz’s counsel queried Plaintiffs’ counsel whether he was
“purposely going for the [privilege] instruction.” Plaintiffs’ counsel explained that the questions
directed at Forest’s and Merz’s subjective beliefs were being used to draw instructions and thereby
ensure that Plaintiffs were not going to be ambushed with subjective beliefs for the first time at
trial:
Q. What did Merz tell Forest regarding its assessment of the merits of the ‘703
patent?
MR. CERRITO: I don’t know if you’re purposely going for the instruction,
but if you are, then I’ll give it, which is –
MR. CHORUSH: I am. I just want to make sure we’re not going to hear that
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at trial for the first time.
MR. CERRITO: I appreciate that, and thank you. So I’m going to instruct
the witness not to answer. He’s just trying to make sure that
--
A. I understand.
MR. CERRITO: -- that -- so I instruct the witness not to answer based on
attorney-client privilege, attorney work product, joint
defense privilege.
MR. JOHNSON: Same instruction here.
Q. Are you following your counsel’s instructions?
A. I am following my counsel’s instructions, yes.
Id. at 143:18-144:19 (emphasis added).
(c) Forest In-House Patent Attorney Eric Agovino
At his September 12, 2017 deposition, Forest’s in-house patent counsel Eric Agovino was
blocked by defense counsel from providing Forest’s subjective reasons for the identical licensed
entry date in the settlement agreements between Forest and the generics concerning the ‘703
Patent:
Q. Now, Mr. Agovino, how did it come about that all of the settlement agreements
with the generic companies that were first filers had the same three month prior to
patent expiration launch date?
A. That’s all Forest would agree to.
Q. Why would Forest only agree to that date?
MR. TOTO: I caution you not to reveal the substance of any privileged communications
or privileged legal analysis, which may mean you can’t answer the question.
But I defer to you.
Q Well, let me withdraw that question because I’m not trying to be tricky. I just want
to know if you’re going to assert privilege objections. Was Forest’s position with
respect to the launch date that they would agree to informed by its counsel?
MR. TOTO: So that is a yes or no question.
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A. Yes.
Q. And what was the advice or position conveyed by Forest’s counsel?
MR. TOTO: I’ll object and instruct you not to answer.
Q. Are you going to follow your attorney’s instructions?
A. Yes.
Ex. 4, Agovino (Sept. 12, 2017) Dep. at 75:10 - 77:4. Forest’s reasons for the agreed launch date
in each agreement with the generic manufacturers were thus kept from Plaintiffs, consistent with
Forest’s election not to assert certain subjective beliefs informed by attorney advice.
(d) Forest’s Lead Settlement Negotiator
On September 7, 2017, Plaintiffs asked David Solomon, Forest’s head of business
development, and the decision-maker on the Mylan patent settlement and Lexapro side-deal,
“[w]hat did [D]r. Ryan tell you that led you to conclude that the generics had a very weak case
[p]ost Markman?” Ex. 6, Solomon (Sept. 7, 2017) Dep. at 286:1-14. Defense counsel objected and
instructed the witness not to answer on the basis of privilege. Id.
2. Interrogatories
On May 12, 2017 – during the pendency of the motion to compel briefing that culminated
in the Disclosure – Plaintiffs served their first three interrogatories. Ex. 7, Plaintiffs’ Amended
First Set of Interrogatories. The three interrogatories sought, respectively, (1) Forest’s contentions
relating to patent infringement, (2) Forest’s contentions relating to patent validity, and (3) “any
facts or law” on which Forest “will rely” relating to any contention that “Mylan’s Defenses were
not meritorious or were unlikely to succeed or that Mylan was not going to or was unlikely to
prevail in the Namenda Patent Litigation absent a settlement.” Id. at 6-7.
On June 12, 2017, after having made its election via its June 2017 Disclosure, Forest
responded to these three interrogatories. Each response included the following language, citing
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the Disclosure and disavowing that it would assert its subjective beliefs:
Forest objects to this Interrogatory to the extent that it seeks irrelevant
information, particularly in light of Forest’s June 2, 2017 Disclosures that it does
not intend to affirmatively rely on Forest’s subjective beliefs to rebut any
argument that its position in the patent case was weak. . . . Forest further objects
to this Interrogatory to the extent that it seeks information or discovery of Privileged
Information. Forest’s subjective beliefs regarding the underlying patent litigation
are privileged and nothing contained in these responses is intended to be, or in any
way constitutes, a waiver of any such applicable privilege, immunity, or doctrine.
Ex. 8, Forest’s Response to Plaintiffs’ Amended First Set of Interrogatories at 10-11, 12-13, 14-
15 (emphasis added). On the final day in the discovery period (September 15, 2017), Forest
submitted its second supplemental responses to these interrogatories and repeated the objections
set forth above. Ex. 9, Forest’s Second Supplemental Response to Plaintiffs’ First Set of
Interrogatories at 10, 12.
3. Document Requests
Plaintiffs also sought documents reflecting Forest’s subjective beliefs about the merits of
the ‘703 Patent. For example, Plaintiffs’ request for production (“RFP”) no. 43 sought:
All documents, regardless of date, concerning the validity, enforceability,
infringement, claim interpretation, and strengths or weaknesses of the Patents,
including, but not limited to: (a) documents concerning any investigation done by
or for any of the Defendants concerning the Patents and (b) legal opinions and
analyses concerning the Patents.
ECF 203-1 (Apr. 18, 2017) at 23. In response, Forest “object[ed] to this Request to the extent that
it calls for production of documents protected from disclosure by the attorney-client privilege,
work product doctrine, joint defense privilege or agreement, or other privilege or protection.” ECF
203-2 (Apr. 18, 2017) at 65. Following a letter from Plaintiffs identifying deficiencies in Forest’s
objections and responses to Plaintiffs’ RFPs (ECF 203-3 (Apr. 18, 2017)), Forest explained that it
planned to “maintain[] all applicable privileges” (ECF 203-5 (Apr. 18, 2017) at 1). Further, with
regard to the documents responsive to Plaintiffs’ RFPs pertaining to patents, Forest only “agree[d]
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to produce non-privileged documents.” ECF 203-5 (Apr. 18, 2017) at 4; id. (“Forest is not making
an issue of any patents, and rejects any argument of a waiver of any applicable privileges . . . while
at the same time confirming on the meet and confer that the patent documents are only relevant to
DPPs’ causation burden. Indeed, it is for this limited purpose of responding to DPPs that Forest is
willing to produce non-privileged, responsive documents to the patent requests outlined by
DPPs.”).
Forest has maintained its privilege objections and has not produced otherwise privileged
information about the patent merits. Forest’s privilege log lists roughly 15,000 documents3 of
which close to 6,000 entries potentially relate to its subjective beliefs about patent merits and/or
generic launch dates. Ex. 10, Excerpts from Forest’s September 22, 2017 privilege log.
C. Forest’s Post-Discovery Gamesmanship
After the close of fact discovery, on September 25, 2017, the Court ordered Forest to
produce five documents that had been “withheld on the basis of privilege,” finding that “these
documents appear to link the Namenda settlements with the side agreements with Mylan and
Orchid.” ECF No. 394 at 1. In a post-discovery deposition of Dr. Ryan concerning the newly-
produced documents, Forest renewed its position that it was not waiving any privilege:
As Forest has stated throughout this litigation, and in particular in our May 19th,
2017 [sic] disclosures, Forest does not intend to waive the attorney-client privilege
in this matter.
Ex. 11, Ryan (Nov. 7, 2017) Dep. at 334:13-16.4 Nevertheless, Dr. Ryan – the very same witness
3 Due to the voluminous nature of Defendants’ full privilege log, it has not been included as an
exhibit, but it can be provided at the Court’s request.
4 Forest made a similar proclamation at the outset of the second deposition of David Solomon,
Forest’s head of business development: “Before you get started, Mr. Litvin, I wanted to say, as I
did in Charles Ryan’s most recent deposition, Forest maintains its position that it does not intend
to waive any attorney-client privilege or work product production [sic].” Ex. 12, Solomon (Nov.
15, 2017) Dep. at 379:10-15.
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who had previously refused to answer questions (at the instruction of defense counsel) about the
patent merits during the discovery period (see supra at 5-6) – gratuitously injected Forest’s belief
that the Namenda patent case was “strong” and that, consequently, Forest would not have agreed
to license any generic to enter the market earlier than three (3) months before patent expiry:
Q. But you are testifying here today that modifying the Lexapro authorized
generic deal was not a component of the current settlement offer Forest was
proposing to Mylan as of February 11, 2010?
MR. TOTO: Objection, argumentative. You may answer.
A. So let me restate my testimony, because I think you're mischaracterizing it.
So we were in -- so maybe I should back up. So we had a very strong case.
We were prepared to go to trial. We weren't going to give more than three
months to anyone, including Mylan. So if Mylan wanted to go to trial, we
could do that. . . .
Id. at 367:1-17 (emphasis added). After Plaintiffs’ counsel asserted that this testimony would
constitute a waiver and sought to strike the testimony as nonresponsive (id. at 370:12-13 and
370:20-371:22), Forest’s counsel responded: “This is not a waiver. This is not putting anything at
issue. This is simply him answering your questions about this document.” Id. at 371:3-15.
But, the testimony was clearly gratuitous and not responsive to the pending question. The
question pertained to the connection between the settlement agreement and modification of the
Lexapro authorized generic deal between Forest and Mylan as clearly articulated in the deposition
exhibit, not Forest’s subjective views of the patent or patent litigation. This testimony was an
intentional effort to inject Forest’s purported subjective patent beliefs into the case despite its
contrary election, while still not providing all withheld documents on this same subject matter to
Plaintiffs so as to prevent a full and fair cross examination.
Forest again engaged in post-discovery gamesmanship in another post-discovery
deposition concerning the newly produced documents (this time of Mr. Solomon) by having
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Forest’s own attorneys elicit from Mr. Solomon, after Plaintiffs’ examination had concluded,
Forest’s subjective views on the patent merits under questions from its own attorneys:
Q. Switching topics to the patent settlement with Mylan, would a settlement
with Mylan that had a launch in 2012 have been acceptable to Forest?
A. We wouldn’t have considered that at all . . . We had settled at that point with
over a dozen generics for no more than three months, some of them for no time at
all. We had, we felt, a very strong case . . .
Ex. 12, Solomon (Nov. 15, 2017) Dep. at 421:12-25 (emphasis added). At no time following these
depositions did Forest offer to (1) produce otherwise-privileged documents necessary to cross
examine these witnesses on the veracity of their assertions; (2) withdraw their privilege objections
and fully answer Plaintiffs’ interrogatories; or (3) provide Plaintiffs any opportunity to re-depose
witnesses to obtain answers to questions Forest’s counsel had previously instructed witnesses not
to answer.
Following these depositions, Forest sought to rely on Mr. Ryan’s subjective belief
testimony in support of its motion for summary judgment. See ECF No. 665 (Dec. 6, 2017) at 39
(quoting deposition testimony that the reason that Forest was not “going to give more than three
months to anyone, including Mylan,” was because “we had a very strong case.”). Plaintiffs urged
the Court to “disregard” this evidence in light of Forest’s election not to assert such subjective
beliefs and its maintenance of privilege during discovery to block inquiry into Forest’s subjective
beliefs. ECF No. 657 (Dec. 11, 2017) at 50-51, n.14.
IV. ARGUMENT
A. Forest Cannot Offer “Subjective Belief” Evidence that Is Contrary to Its Election
or that Was Withheld During Discovery
1. The Court-Ordered Disclosure Binds Forest
The Court’s May 19, 2017 Order that Forest elect which “subjective beliefs” it would rely
upon (ECF No. 249) was mandatory, not permissive; and Forest’s Disclosure is binding, not
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revocable. First, it was Forest that suggested the Lidoderm “framework” (ECF No. 232 (May 3,
2017) at 15) to elect whether to assert subjective beliefs about matters informed by attorney advice
(and thereby waive privilege). As the Lidoderm court explained, its framework is binding:
Having forced defendants to choose between waiving attorney-client privilege and
foregoing testimony by percipient and expert witnesses about their subjective
motivations and beliefs, the defendants have made their elections and now must
live with them.
Ex. 13, In re Lidoderm Antitrust Litig., Civil No. No. 14-md-02521-WHO (N.D. Cal. July 17,
2017) (ECF No. 795) (slip opinion) at 1.
Second, Plaintiffs argued that an early election was necessary so that they would have time
to address in discovery those subjects for which Forest elected to assert its subjective beliefs:
[I]f the Court rules that Forest’s assertions addressed herein would trigger a waiver,
Plaintiffs would be amenable to the Lidoderm approach, which would enable Forest
to abandon its defenses if it wanted -- provided that Forest produce such a list in 14
days, which was the time frame used by the Lidoderm court and which would be
appropriate here in light of the aggressive discovery schedule.
ECF No. 238 (May 8, 2017) at 10. The Court subsequently noted that the “schedule in this action
is constricted” and therefore ordered “that Forest disclose any subjective beliefs it will rely on in
its defense of this action within two weeks of the date of this order.” ECF No. 249 at 14 (May 19,
2017 Order). Thus, it was clear to the parties that Forest’s election was going to be binding and
that the parties could rely on it in conducting discovery.
Finally, logic compels the conclusion that Forest’s own election is binding. The entire
purpose of the election was for Forest to finally decide which “subjective beliefs” it intended to
rely upon going into discovery. The election was meaningless if Forest was free to later modify it,
particularly after the close of discovery, without leave of Court.
2. Forest Cannot Withhold Evidence as Privileged During Discovery But
Then Introduce the Withheld Evidence at Trial
An independent basis to preclude Forest from relying at trial on its subjective views of its
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patent or the patent litigation is its refusal to disclose those views in discovery. The Second Circuit
long ago recognized that “[t]he basic purpose of the federal rules, particularly those concerning
discovery and disclosure, is to eliminate trial by ambush[.]” Ginns v. Towle, 361 F.2d 798, 801 (2d
Cir. 1966). But “trial by ambush” would be a regular practice if parties could withhold relevant
evidence in discovery but then offer it at trial. As set forth above, Forest repeatedly blocked
Plaintiffs from discovery relating to its beliefs on various subjects, most notably including its
subjective views of the merits of the ‘703 Patent and patent litigation. If Forest wanted to preserve
its ability to assert its subjective beliefs in defending this case, it was required to timely produce
all otherwise-privileged documents related to those beliefs to permit Plaintiffs the opportunity to
test the credibility of its assertions. In re Namenda Direct Purchaser Antitrust Litig., 2017 U.S.
Dist. LEXIS 76675, at *13 (S.D.N.Y. May 19, 2017) (when “attorney-client advice played a
significant role in formulating a party’s subjective beliefs on central issues in the case, the
adversaries are entitled to disclosure of the otherwise privileged material to test the credibility of
those subjective beliefs.”), quoting Lidoderm, 2016 U.S. Dist. LEXIS 105619, at *36; Regeneron
Pharm., Inc. v. Merus B.V., 144 F. Supp. 3d 530, 593-96 (S.D.N.Y. 2015) (where Regeneron
wanted to rely on its state of mind at trial, it “was obligated to have previously produced the
documents . . . that would have allowed Merus to test [its] various assertions.”).
Courts routinely preclude litigants from offering at trial evidence that was withheld as
privileged during discovery:
[I]t should be made clear to the Defendants . . . that they will be unable to withhold
production of arguably privileged documents during discovery and thereafter
appear at trial, waive the privilege and claim to the jury that they relied in good
faith on the advice of counsel . . .
Guglielmo v. Kopald, No. 05-cv-7887 (CLB), 2007 U.S. Dist. LEXIS 46558, at *11-12 (S.D.N.Y.
June 26, 2007). See also United States v. 4003-4005 5th Ave., 55 F.3d 78, 84-85 (2d Cir. 1995) (in
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the closely related Fifth Amendment context, explaining if privilege is invoked “to abuse or
obstruct the discovery process . . . particularly if the litigant’s request to waive comes only at the
‘eleventh hour’ and appears to be part of a manipulative, ‘cat-and-mouse approach’ to the
litigation, a trial court may be fully entitled, for example, to bar a litigant from testifying later
about matters previously hidden from discovery through an invocation of the privilege.”); Union
Pac. R. Co. v. Colony Nat’l Ins. Co., No. 8:13CV84, 2016 U.S. Dist. LEXIS 122701, at *11-12
(D. Neb. Sept. 9, 2016) (“[I]f Union Pacific continues to invoke privilege in response to Colony’s
discovery requests, Union Pacific will be barred from introducing any evidence of how its
attorneys evaluated the underlying claims at the time of settlement or how its attorneys perceived
Union Pacific’s liability at the time of the settlement.”).5
Just last month, in another reverse-payment antitrust litigation concerning the drug
Androgel, the court barred the defendants from “introduc[ing] opinion testimony about the merits
of the underlying patent litigation where it has invoked attorney-client privilege or work product
privilege as to the bases for that opinion.” Ex. 14, Order, Fed. Trade Comm’n v. Actavis, Inc., No.
1:09-CV-955-TWT (N.D. Ga. Feb. 26, 2019) (ECF No. 855) at 1.
Here, Forest understood very clearly that its election (via its Disclosure) was going to limit
the evidence it could present at trial. At no time did Forest approach Plaintiffs or seek leave of the
5 See also UnitedHealth Grp. Inc. v. Columbia Cas. Co., 47 F. Supp. 3d 863, 875 (D. Minn. 2014),
aff’d sub nom. UnitedHealth Grp. Inc. v. Exec. Risk Specialty Ins. Co., 870 F.3d 856 (8th Cir.
2017) (“The first type of evidence—that is, evidence of how the insured or its attorneys evaluated
the claims at the time of settlement—is not available to United, as United repeatedly invoked the
attorney-client privilege and work-product doctrine to prevent the insurers from inquiring into
United’s (or its counsels’) subjective evaluations of AMA, Malchow, and the Settlement.”); id.
(“Needless to say, a party cannot use the attorney-client privilege or the work-product doctrine
both as a shield and as a sword. If United wanted to use evidence of its or its counsels’ settlement
evaluations as evidence in this case—which is what United would be doing were it to offer its or
its counsels’ out-of-court statements on that subject—then United had to allow the insurers to
inquire about those evaluations during discovery.”).
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Court to amend its Disclosure to include the strength or weakness of its patents or patent litigation,
or the basis for the agreed entry date in its settlement agreements with the various generic
manufacturers, as subjective beliefs it would assert at trial. Nor did it produce any otherwise
privileged documents concerning those subjects. Instead, as noted above, Forest repeatedly
invoked privilege to withhold documents, deposition testimony and complete interrogatory
responses concerning its subjective views of the patent case. Notably, Dr. Ryan, Forest’s chief
patent counsel, was repeatedly instructed not to answer questions going to Forest’s subjective
beliefs about the patent merits. See supra at 5-6. Then, during the limited post-discovery
depositions of Messrs. Ryan and Solomon convened to address documents not relating to the patent
merits, Forest sandbagged Plaintiffs by gratuitously injecting its purported belief that it “had a very
strong [patent] case” while standing firm on its refusal to produce some or all of the 15,000
documents and other information touching on this same subject withheld on the basis of privilege
and its election. Forest’s attempted sand-bagging should not be countenanced.
B. Plaintiffs Would Suffer Undue Prejudice by an Eleventh-Hour Waiver
In hindsight, Forest’s shifting pre- and post-discovery strategies concerning its subjective
patent views appears to have been a carefully-crafted plan to conduct an end-run around the
Court’s Order by (1) asserting privilege during discovery to avoid waiving privilege and scrutiny
over its purported subjective beliefs that it elected not to assert in its Disclosure but then (2) pulling
the rug out from under Plaintiffs by offering a bare bones statement of its subjective beliefs after
discovery was over without producing the relevant discovery that would have enabled Plaintiffs to
test its assertions.6 If this type of gamesmanship was tolerated by the courts, litigations would have
6 To the extent Forest now contends it has abandoned its election, it would be improper for it to
continue to withhold documents as privileged in the ongoing End-Payor action.
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to conduct discovery twice – once pursuant to the original election and a second time after a post-
discovery decision to rescind the election.
During discovery, Plaintiffs detrimentally relied on Forest’s explicit Disclosure that it
would not assert subjective beliefs about the strength or weakness of its patents, and were deprived
of the otherwise-privileged documents Forest would have been required to produce that would
have permitted Plaintiffs to test those beliefs. Plaintiffs took discovery, prepared their pretrial
filings, and have built their case predicated on the election Forest made. Plaintiffs would be
severely prejudiced by any last-minute change now. A late waiver in contradiction of the
Disclosure would derail the schedule in this case as it heads toward trial, and/or turn the trial into
a circus. See Regeneron Pharm., Inc., 144 F. Supp. 3d at 594-95 (subjective views about patent
inadmissible at trial because to allow them would require “in fairness . . . a wholesale re-opening
of discovery,” including “a top-to-bottom re-review of the Regeneron privilege log . . . to be
followed by additional document production, fact depositions, and revised expert reports and
depositions,” which “is not a fair burden for Merus or the Court.”). Forest’s privilege log consists
of roughly 15,000 documents, more than a third of which potentially relate to subjective beliefs
withheld by Forest. See Ex. 10 (privilege log excerpts). It is simply late too reverse course.
V. CONCLUSION
For the foregoing reasons, Forest should be precluded from offering at trial any “subjective
beliefs” assertion it did not list on its June 2017 Disclosure.
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Dated: March 14, 2019
Respectfully Submitted:
David F. Sorensen
Daniel C. Simons
Berger & Montague, P.C.
1818 Market Street – Suite 3600
Philadelphia, PA 19103
(215) 875-3000
(215) 875-4604 (fax)
dsorensen@bm.net
dsimons@bm.net
/s/ Dan Litvin
Bruce E. Gerstein
Joseph Opper
Kimberly M. Hennings
Dan Litvin
Garwin Gerstein & Fisher LLP
88 Pine Street, 10th Floor
New York, NY 10005
Tel: (212) 398-0055
Fax: (212) 764-6620
bgerstein@garwingerstein.com
jopper@garwingerstein.com
khennings@garwingerstein.com
dlitvin@garwingerstein.com
Peter Kohn
Joseph T. Lukens
Faruqi & Faruqi, LLP
1617 John F Kennedy Blvd. – Suite 1550
Philadelphia, PA 19103
(215) 277-5770
(215) 277-5771 (fax)
pkohn@faruqilaw.com
jlukens@faruqilaw.com
David C. Raphael, Jr.
Erin R. Leger
Smith Segura & Raphael, LLP
3600 Jackson Street, Suite 111
Alexandria, LA 71303
Tel: (318) 445-4480
Fax: (318) 487-1741
draphael@ssrllp.com
Stuart E. Des Roches
Andrew W. Kelly
Odom & Des Roches, LLC
650 Poydras Street, Suite 2020
New Orleans, LA 70130
Tel: (504) 522-0077
Fax: (504) 522-0078
stuart@odrlaw.com
Russ Chorush
Miranda Jones
Heim Payne & Chorush, LLP
1111 Bagby, Suite 2100
Houston, TX 77002
Tel: (713) 221-2000
Fax: (713) 221-2021
Case 1:15-cv-07488-CM-RWL Document 687 Filed 03/14/19 Page 23 of 25
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rchorush@hpcllp.com
Counsel for the Direct Purchaser Class Plaintiffs
Case 1:15-cv-07488-CM-RWL Document 687 Filed 03/14/19 Page 24 of 25
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CERTIFICATE OF SERVICE
I hereby certify that on March 14, 2019, I electronically filed the above by CM/ECF
system.
Respectfully submitted
/s/ Dan Litvin
Dan Litvin
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