Browsing by Subject "pay-for-delay"

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    Anticompetitive Patent Settlements and the Supreme Court’s Actavis Decision
    (Minnesota Journal of Law, Science and Technology, 2014-02-20) Hovenkamp, Herbert
    Reverse payment patent litigation settlements, wherein the payments flow from plaintiff brand name drug companies to defendant generic competitors, often including agreements that the generic companies will delay market entry, have evaded consistent legal treatment and divided courts for over a decade. In December 2012, the United States Supreme Court granted the Federal Trade Commission’s petition for writ of certiorari to review FTC v. Watson Pharmaceuticals. In Watson, the Eleventh Circuit found that, absent sham litigation or fraud, reverse payment settlements are legal under antitrust law as long as the settlement agreement falls within the exclusionary scope of the patent. The Watson decision was followed mere months later by the Third Circuit’s In re K-DUR decision, concluding that reverse-payment settlements should be deemed presumptively unlawful under a quick-look rule of reason approach. Because “different courts have reached different conclusions” regarding the legality of reverse-payment settlements, the Supreme Court endeavored to resolve the circuit split in FTC v. Actavis, Inc. On June 17, 2013, with Justice Breyer writing the majority opinion in a 5-3 decision, the Supreme Court reversed the Eleventh Circuit, holding that governments and private plaintiffs have a cause of action under the antitrust laws against brand name and generic pharmaceutical companies engaging in reverse payment settlements. The Court directed lower courts reviewing such claims to apply a full rule of reason analysis to drug companies’ potentially anticompetitive conduct. In the spring of 2013, in anticipation of the Court’s decision, the Minnesota Journal of Law, Science & Technology invited scholars and practitioners who have analyzed and developed the jurisprudence of reverse payment settlements to respond to FTC v. Actavis, Inc. This article is a response piece that will digest the opinion, critique both Justice Breyer’s majority opinion and Chief Justice Roberts’ dissent, and provide direction for courts and practitioners in navigating the new legal landscape of reverse-payment settlements in the wake of FTC v. Actavis, Inc.
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    The Preemptive Power of Federal Patent Law: A Framework for Analyzing State Antitrust Challenges to Pay-for-Delay Settlements
    (Minnesota Journal of Law, Science and Technology, 2013-07-01) Marsili, Caroline
    Since the passage of the Hatch-Waxman Act (the Act) in 1984, patent litigation in the pharmaceutical industry has generated a troubling breed of settlement agreements wherein the payment goes from patentee plaintiffs to allegedly infringing defendants, resulting in anticompetitive effects. The provisions of the Act, though intended to promote innovation and lower drug prices while expediting infringement litigation, tend to incentivize reverse payments, or pay-for-delay settlements. The settlements are often challenged by the Federal Trade Commission (FTC) and by private parties for violation of antitrust law. Thus, pay-for-delay settlements illustrate a tension between patent law and antitrust law. Since the adoption of the Act, courts have struggled to harmonize the two bodies of law with regard to pay-for-delay settlements, as evidenced by the widely divergent rulings on the legality of these settlements among regional circuit courts. In December 2012, the Supreme Court granted a writ of certiorari to review Federal Trade Commission v. Watson Pharmaceuticals, Inc., an Eleventh Circuit case favoring the pharmaceutical companies, and should enunciate the proper legal standard to apply to pay-for-delay settlements.