Justia Antitrust & Trade Regulation Opinion SummariesArticles Posted in U.S. Court of Appeals for the Second Circuit
In re ACTOS End-Payor Antitrust Litigation
Plaintiffs filed a class action alleging that Takeda prevented competitors from timely marketing a generic version of Takeda’s diabetes drug ACTOS by falsely describing two patents to the FDA. Plaintiffs claimed that these false patent descriptions channeled Takeda’s competitors into a generic drug approval process that granted the first-filing applicants a 180-day exclusivity period, which in turn acted as a 180-day "bottleneck" to all later-filing applicants. 9 out of 10 generic applicants took that route. Teva was prevented from seeking approval via another regulatory mechanism when the FDA announced that all generic manufacturers would be required to take the bottlenecked route. Plaintiffs alleged that they were wrongfully obligated to pay monopoly prices for ACTOS when Takeda's patent on the active ingredient in ACTOS expired when the mass of generic market entry occurred. The district court dismissed plaintiffs' antitrust claims. The court affirmed to the extent that plaintiffs' theory posits a delay in the marketing of generic alternatives to ACTOS by all the generic applicants other than Teva, because plaintiffs' theory presupposes that these applicants were aware of Takeda’s allegedly false patent descriptions when they filed their applications, which is not supported by well-pleaded allegations. However, the court concluded that plaintiffs' theory as to Teva does not require any knowledge of the false patent descriptions. Therefore, the court reached other issues as to Teva and found plaintiffs plausibly alleged that Takeda delayed Teva's market entry. Accordingly, the court affirmed in part, vacated in part, and remanded for further proceedings. View "In re ACTOS End-Payor Antitrust Litigation" on Justia Law
United States v. American Express Co.
Amex appealed from the district court's decision finding that it unreasonably restrained trade in violation of section 1 of the Sherman Act, 15 U.S.C. 1, by entering into agreements containing nondiscriminatory provisions (NDPs). The district court held that Amex was liable for violating section 1 and enjoined Amex from enforcing its NDPs. The court concluded that the district court erred here in focusing entirely on the interests of merchants while discounting the interests of cardholders. Plaintiffs bore the burden in this case to prove net harm to Amex consumers as a whole - that is, both cardholders and merchants - by showing that Amex’s nondiscriminatory provisions have reduced the quality or quantity of credit‐card purchases. The court concluded that, given the district court’s explicit finding that neither party provided reliable evidence of Amex’s costs or profit margins accounting for consumers on both sides of the platform, and given evidence showing that the quality and output of credit cards across the entire industry continues to increase, plaintiffs failed to carry their burden to prove a section 1 violation. Accordingly, the court reversed and remanded. View "United States v. American Express Co." on Justia Law
FTC v. LeadClick Media, LLC
The FTC and the State filed suit seeking to hold LeadClick liable for its role in the use of deceptive websites to market weight loss products in violation of Section 5 of the Federal Trade Commission Act (FTC Act), 15 U.S.C. 45(a)(1), and the Connecticut Unfair Trade Practices Act (CUTPA), C.G.S.A. 42‐110b(a). The FTC also filed a claim against CoreLogic, LeadClick's parent company, as a relief defendant. The district court granted summary judgment in favor of the FTC and the State. The court affirmed the district courtʹs grant of summary judgment for the FTC and the State with respect to the claims against LeadClick where LeadClick is an information content provider with respect to the content at issue and where LeadClick is liable for its own content and not merely because it was the ʺpublisher or speakerʺ of deceptive content provided by its affiliates; reversed as to the claim against CoreLogic where CoreLogic's advances to LeadClick constituted "valuable consideration" entitling it to repayment from LeadClick; and remanded with instructions to the district court to enter judgment in favor of CoreLogic. View "FTC v. LeadClick Media, LLC" on Justia Law
In Re: Vitamin C Antitrust Litig.
A multi-district antitrust class action was brought by plaintiffs against defendants, entities incorporated under the laws of China, alleging that defendants conspired to fix the price and supply of vitamin C sold to U.S. companies on the international market in violation of Section 1 of the Sherman Act, 15 U.S.C. 1, and Sections 4 and 16 of the Clayton Act, 15 U.S.C. 4, 16. Defendants challenge the district court's denial of their initial motion to dismiss, denial of a subsequent motion for summary judgment, and, after a jury trial, an entry of judgment awarding plaintiffs $147 million in damages and enjoining defendants from engaging in future anti-competitive behavior. The court held that the district court erred in denying defendants' motion to dismiss. In this case, because the Chinese Government filed a formal statement in the district court asserting that Chinese law required defendants to set prices and reduce quantities of vitamin C sold abroad, and because defendants could not simultaneously comply with Chinese law and U.S. antitrust laws, the principles of international comity required the district court to abstain from exercising jurisdiction in this case. Accordingly, the court vacated the judgment, reversed the district court's order denying defendants' motion to dismiss, and remanded for further proceedings. View "In Re: Vitamin C Antitrust Litig." on Justia Law
In re Set-Top Cable Television Box Antitrust Litig.
Time Warner filed suit alleging a violation of the Sherman Act, 15 U.S.C. 1 et seq., in the tying of certain premium cable television services to the leasing of ʺinteractiveʺ set‐top cable boxes. The district court dismissed two iterations of the complaint, including the Third Amended Complaint, the operative complaint for the purposes of this opinion. The court held that the Third Amended Complaint fails to adequately plead facts that, if proven, would establish that: (i) the set‐top cable boxes and the premium programming they transmit are separate products for the purposes of antitrust law; and (ii) Time Warner possesses sufficient market power in the relevant markets to establish an illegal tie‐in. Accordingly, the court affirmed the judgment. View "In re Set-Top Cable Television Box Antitrust Litig." on Justia Law
MacDermid Printing Sols. LLC v. Cortron Corp.
Cortron appealed the district court's award of damages pursuant to a jury verdict of MacDermid on its claims for violations of federal and Connecticut antitrust laws, breach of contract, misappropriation of trade secrets, spoliation, and violations of Connecticut statutes prohibiting computer crimes and unfair trade practices. At issue are the requirements for proving an adverse effect on competition for purposes of section 1 of the Sherman Act, 15 U.S.C. 1, in cases where the plaintiff has not proved that the allegedly anticompetitive behavior led to higher prices, reduced output, or lower quality in the market. The court held that a plaintiff may not prevail under the “rule of reason” merely by proving that (1) the defendant exercised “market power,” and (2) the challenged behavior may have misled consumers to believe that certain products were no longer available, without showing that consumers actually experienced reduced access to those products. In this case, the court agreed with Cortron that the district court erred in denying Cortron judgment as a matter of law with respect to MacDermid’s antitrust claims because MacDermid failed to present evidence that Cortron’s conduct harmed competition. Accordingly, the court reversed as to this claim. The court otherwise affirmed the judgment and remanded for recalculation of damages. View "MacDermid Printing Sols. LLC v. Cortron Corp." on Justia Law
In re Aluminum Warehousing Antitrust Litig.
Appellants claim that some aluminum futures traders, having acquired some operators of aluminum warehouses, manipulated a price component for aluminum in the Detroit metro area. The district court dismissed the complaints and denied two groups of plaintiffs leave to amend, while permitting a third group to amend their complaint. The district court then concluded that appellants lacked antitrust standing because they did not demonstrate that they suffered antitrust injury or that they were efficient enforcers of the antitrust laws, and that they would be unable to show that they were efficient enforcers through repleading. The district court also determined that appellants failed to state a claim under various state consumer protection and unfair trade practices laws. The court held that appellants lack antitrust standing on the ground that they did not (and could not) suffer antitrust injury. The court also held that their state law claims were inadequately pleaded. Accordingly, the court affirmed the judgment. View "In re Aluminum Warehousing Antitrust Litig." on Justia Law
In re Payment Card Interchange Fee and Merchant Discount Antitrust
In an antitrust class action brought on behalf of approximately 12 million merchants against Visa and Mastercard, as well as other various banks, plaintiffs alleged conspiracy in violation of Section 1 of the Sherman Act, 15 U.S.C. 1. After the parties agreed to a settlement releasing all claims, the district court certified two settlement-only classes and approved the settlement. Numerous objectors and opt‐out plaintiffs appealed and argued that the class action was improperly certified and that the settlement was unreasonable and inadequate. The court concluded that class members of the (b)(2) class were inadequately represented in violation of both FRCP 23(a)(4) and the Due Process Clause. The court also concluded that procedural deficiencies produced substantive shortcomings in this class action and the settlement. Consequently, the court concluded that the class action was improperly certified and the settlement was unreasonable and inadequate. The court vacated the district court's certification of the class action and reversed the approval of the settlement. The court remanded for further proceedings. View "In re Payment Card Interchange Fee and Merchant Discount Antitrust" on Justia Law
In re: LIBOR-Based Financial Instruments Antitrust Litig.
Plaintiffs filed numerous antitrust suits alleging that the Banks colluded to depress LIBOR by violating the rate‐setting rules, and that the payout associated with the various financial instruments was thus below what it would have been if the rate had been unmolested. After consolidation into a multi-district litigation (MDL), the district court dismissed the litigation in its entirety based on failure to plead antitrust injury. The court vacated the judgment on the ground that: (1) horizontal price‐fixing constitutes a per se antitrust violation; (2) a plaintiff alleging a per se antitrust violation need not separately plead harm to competition; and (3) a consumer who pays a higher price on account of horizontal price‐fixing suffers antitrust injury. The court remanded for further proceedings on the question of antitrust standing. Finally, the court rejected the Bank's alternative argument that no conspiracy has been adequately alleged. View "In re: LIBOR-Based Financial Instruments Antitrust Litig." on Justia Law
Apotex Inc. v. Acorda Therapeutics, Inc.
Apotex filed suit alleging that Acorda filed a sham citizen petition with the FDA to hinder approval of Apotex's competing formulation of a drug for treating spasticity, in violation of Section 2 of the Sherman Act, 15 U.S.C. 2, and that Acorda violated the Lanham Act's, 15 U.S.C. 1125(a)(1), proscription on false advertising. The district court ruled that the simultaneous approval by the FDA of Apotex’s drug application and its denial of Acorda’s citizen petition was by itself insufficient to support a Sherman Act claim. The district court then granted summary judgment and dismissed all of Apotex’s false advertising claims on the grounds that (with the exception of one graph) no representation was literally false or likely to mislead consumers. In regard to the graph, Apotex failed to show that the false depiction would meaningfully impact consumers’ purchasing decisions. The court concluded that, although precedent supports an inference that a citizen petition is an anticompetitive weapon if it attacks a rival drug application and is denied the same day that the application is approved, that inference has been undercut by recent FDA guidance. As to false advertising, the court agreed with the district court that no reasonable jury could have found that Acorda made literally false or misleading representations in its advertisements, with the exception of a single representation that Apotex has failed to show affected decisions to purchase. Accordingly, the court affirmed the judgment. View "Apotex Inc. v. Acorda Therapeutics, Inc." on Justia Law