Big Pharma Fires Defensive Missile: Complaint Filed for Attempted Extortion

Authored by Michelle Carniaux

Big pharma continues to be on the defensive against IPR attacks by financiers, this time, by filing a civil law suit against a financier/IPR petitioner. Last Friday, Allergan filed a complaint in the Central District of California for attempted extortion, unfair competition and malicious prosecution, against Ferrum Ferro Capital. According to the complaint, Ferrum Ferro filed an “objectively baseless IPR petition for the express purpose of monetizing the petition, including by attempting to extort compensation from Allergan.” Allergan, Inc. et al. v. Ferrum Ferro Capital, LLC et al., 8:15-cv-00992, No. 1 at 2 (C.D.Cal., June 19, 2015).

The complaint alleges that on the day the IPR petition was filed, Ferrum Ferro sent a letter to Allergan threatening with its IPR petition as follows: “‘[FFC] is confident that at a minimum, the IPR petition for the ‘149 patent presents a significant and terminal threat to Allergan’s exclusive rights to distribute Combigan,'” and setting a deadline of March 18, 2015 for Allergan to contact Ferrum Ferro to discuss a settlement. Id. at 9-10. With its law suit, Allergen seeks, among other things, a permanent injunction, and an award of restitutionary damages and reasonable attorneys’ fees.

Ferrum Ferro’s IPR petition is against an Allergan glaucoma drug patent, and was the subject of one of our previous posts. This past Monday, Allergan filed its Preliminary Response to the petition. See IPR2015-00858, Paper No. 6 (P.T.A.B. June 22, 2015). In the response, Allergan states that the IPR petition is “extortion, pure and simple,” and that it may seek from the Board sanctions against Ferrum Ferro and its counsel including dismissing the Petition and awarding attorneys’ fees to Allergan. Id. at 3.

It will be interesting to see how this plays out, both in district court and before the Board. We should be able to get a sense of the direction this will go soon, since the Board will be acting on the IPR petition within the next three months.