BETA PHARMA, INC. v. INVENTISBIO (SHANGHAI) CO., LTD.
3:21-cv-05103
D.N.J.Dec 8, 2022Background
- Beta Pharma, a Delaware pharmaceutical company, developed a third‑generation EGFR‑TKI core compound called BPI‑7711 and pursued patent protection and clinical trials in China and the U.S.
- Beta Pharma engaged patent attorney Wansheng Jerry Liu (partner at Fox Rothschild) in 2012 to prepare and prosecute its U.S. patent applications; Liu attended a July 9, 2014 meeting where Beta Pharma disclosed BPI‑7711 to him.
- InventisBio (Shanghai) and its R&D VP Yueheng Jiang filed Chinese, PCT, and later U.S. patent applications claiming BPI‑7711 beginning November 2014; Jiang is listed as inventor on the filings.
- Beta Pharma filed its own U.S. applications in December 2014 and thereafter; a PTO examiner rejected Beta Pharma’s claims in 2018 under 35 U.S.C. § 102(a) based on InventisBio’s earlier filings.
- Beta Pharma sued alleging DTSA trade‑secret theft and related state claims; Defendants moved to dismiss for failure to state a DTSA claim and other defects.
- The Court dismissed the federal DTSA claim for failure to plead misappropriation with sufficient factual support, declined to exercise supplemental jurisdiction over the state claims, and dismissed the complaint without prejudice, granting leave to amend within 30 days.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Beta Pharma pleaded a prima facie DTSA misappropriation claim | Liu received confidential BPI‑7711 information at the July 9, 2014 meeting and then conveyed it to Jiang/InventisBio, who filed patents first | Allegations are conclusory; complaint fails to plead when, how, or any facts showing a transfer or use linking Liu to InventisBio | Dismissed: allegations insufficiently particularized to plausibly show misappropriation under DTSA |
| Whether circumstantial facts support an inference of misappropriation (timing, access, rapid development, lack of expertise) | Relies principally on Liu's access and temporal proximity of InventisBio filings | Access alone is inadequate; no pleaded circumstantial indicia like concealment, lack of expertise, or rapid replication | Dismissed: complaint lacks Oakwood‑style circumstantial allegations showing plausibility |
| Whether the court should retain supplemental jurisdiction over state claims after dismissing federal claim | Plaintiff seeks to proceed on state claims joined to DTSA claim | Defendants argue dismissal of federal claim warrants declining supplemental jurisdiction | Court declined supplemental jurisdiction and dismissed state claims without prejudice |
| Procedural remedy: leave to amend | Plaintiff should be allowed to correct pleading defects | Defendants opposed continuing deficient pleadings | Court granted leave to amend within 30 days and suggested revisiting overlapping state‑law claims when repleading |
Key Cases Cited
- Markowitz v. Northeast Land Co., 906 F.2d 100 (3d Cir. 1990) (on a motion to dismiss, court accepts nonconclusory factual allegations as true)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (complaint must plead plausible facts, not mere conclusions)
- In re Rockefeller Ctr. Props. Secs. Litig., 311 F.3d 198 (3d Cir. 2002) (pleading stage inquiry tests plausibility, not ultimate merits)
- Burtch v. Milberg Factors, Inc., 662 F.3d 212 (3d Cir. 2011) (conclusory allegations are not assumed true on Rule 12(b)(6) review)
- Par Pharm., Inc. v. QuVa Pharma, Inc., [citation="764 F. App'x 273"] (3d Cir.) (DTSA elements: existence of trade secret and misappropriation)
- Oakwood Labs. LLC v. Thanoo, 999 F.3d 892 (3d Cir. 2021) (identifies circumstantial factors that can make a DTSA misappropriation claim plausible)