The Second Circuit finally heard argument today in the long-running In re DDAVP Antitrust Litigation, 5-cv-2237 (SDNY).
The case was brought by purchasers of the pharmaceutical drug desmopressin acetate ("DDAVP") back in early 2005, alleging that Defendants Ferring and Aventis took certain steps, including wielding a patent obtained by fraud on the Patent Office, to keep generic competition to DDAVP off of the market, thereby causing purchasers of DDAVP to pay higher prices than they should have.
In November 2006, Judge Charles Brieant -- who sadly passed away earlier this year -- dismissed Plaintiffs' claims holding, among other things, that purchasers of a patented product do not have standing to bring a claim under the antitrust laws to recover damages in the form of overcharges, even if the patent covering the product was procured through outright, intentional fraud on the Patent Office and even if it clearly led to purchasers being economically harmed. The decision is here:
It's a long story why the case took so long to be heard - suffice it to say that hopefully today's argument will spell the issue's impending resolution, in the Second Circuit at least.
I don't profess to have any knowledge about the merits of the case itself under its facts, but I am not alone in believing the standing issue to be quite significant: it goes to the heart of the antitrust law's ability to deter corporate misconduct and to provide a remedy for those directly harmed by anticompetitive conduct.
[full disclosure - I worked on the case for a short time awhile ago, but do not work on it anymore.]
If antitrust law cannot do these things, what can it do?
As Judge Livingston (who presided today, despite being the Court' s most recent appointee) suggested while quizzing Ferring's counsel, if harmed purchasers simply can't recover as a matter of law, the deterrent effect of the Clayton Act will be substantially undercut. It was nice to hear a jurist specifically focusing on the issue of deterrence - which is often woefully neglected.
Nor is this issue just a concern to the private bar. In the DDAVP case, the DOJ and FTC took the unusual step of submitting a powerful joint amicus brief favoring the plaintiffs on the standing issue.
James Fredericks argued today for the DOJ and did a nice job, as did David Sorensen for the plaintiffs.
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