Brief of Amici Curiae 49 Professors in Support of Petitioners

California Supreme Court brief in In re Cipro Cases I & II, 2014

47 Pages Posted: 19 Mar 2014

See all articles by Michael A. Carrier

Michael A. Carrier

Rutgers Law School

Judith Zahid

Zelle Hofmann Voelbel & Mason LLP

Date Written: March 18, 2014

Abstract

In FTC v. Actavis, the U.S. Supreme Court held that a brand-name drug company’s payment to a generic firm to delay entering the market could violate the antitrust laws. What does that mean for the earlier opinion of the California Court of Appeal in the “Cipro” case that had upheld Bayer’s payment of $398 million to generics? This amicus brief, filed in the California Supreme Court on behalf of 49 Professors, answers that question in three steps.

The first explains how the Actavis ruling knocked out each of the six pillars that had supported the California Court of Appeal’s decision. These pillars were based on (1) exclusion payments’ supposed lack of anticompetitive effects, (2) the toothless “scope of the patent” test, (3) a dispositive public policy favoring settlement, (4) the public policy (or at least one strand) underlying patent law, (5) the alleged need for exclusion payments to attain settlements, and (6) the “natural” status of exclusion payments.

The second step concludes, based on the Cartwright Act, section 16600 of the Business and Professions Code, and the Unfair Competition Act, that California law reaches beyond federal law in its emphasis on consumer welfare and condemnation of trusts.

And the third explains that preemption doctrine does not prevent California courts from rigorously analyzing settlements like the one in this case.

Keywords: patent, antitrust, drugs, pharmaceuticals, settlements, reverse payments, exclusion payments, Cipro, Hatch Waxman Act, Cartwright Act

JEL Classification: I18, K21, L40, L41, L43, L65, O34, O38

Suggested Citation

Carrier, Michael A. and Zahid, Judith, Brief of Amici Curiae 49 Professors in Support of Petitioners (March 18, 2014). California Supreme Court brief in In re Cipro Cases I & II, 2014. Available at SSRN: https://ssrn.com/abstract=2411132

Michael A. Carrier (Contact Author)

Rutgers Law School ( email )

217 North Fifth Street
Camden, NJ 08102-1203
United States
856-225-6380 (Phone)
856-225-6516 (Fax)

Judith Zahid

Zelle Hofmann Voelbel & Mason LLP

44 Montgomery St.
Suite 3400
San Francisco, CA 94104
United States

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