Daily Dicta: In EpiPen Suit, Kansas Judge Sticks it to Mylan
When you've got a 6-year-old who suddenly can't breathe, the notion of an EpiPen as a profit center becomes obscene.
August 21, 2018 at 07:55 PM
9 minute read
My daughter's best friend in elementary school had a severe tree nut allergy. She once had a medical emergency in my car because I was also hauling a dusty bag of mulch that included shredded nut hulls.
Which is my way of saying upfront that I'm on Team Plaintiff all the way in a class action accusing the EpiPen makers of anticompetitive and unfair business conduct. Because when you've got a 6-year-old who suddenly can't breathe, the notion of an EpiPen as a profit center becomes obscene.
On Monday, a federal judge in Kansas allowed most of the claims by individual consumers and third-party payors in a massive MDL against Mylan and Pfizer to move forward.
In 2007, Mylan acquired the right to market and distribute the EpiPen. The device itself—a disposable, prefilled automatic injection of epinephrine—is made by Pfizer.
According to court papers, the cost of epinephrine has remained steady at about $1, but Mylan has jacked up the EpiPen price from $100 in 2007 to $600 by 2016, generating more than $1 billion in annual sales.
The FDA last week finally approved a generic EpiPen, but in the past, Mylan has controlled nearly 100 percent of the market.
The plaintiffs allege that Mylan shut down competition via rebate schemes, exclusive deals and restrictive patent litigation settlements. They asserted nine claims against the Mylan defendants, including Sherman and Clayton act violations, state antitrust law claims, RICO and consumer protection violations and unjust enrichment.
In a 128-page decision, U.S. District Judge Daniel Crabtree let most of the suit proceed, though he knocked out some state law claims, for example, because there were no named plaintiffs from certain states.
It's a win for a formidable team of plaintiffs lawyers—co-lead counsel are Warren T. Burns of Burns Charest, Paul Geller of Robbins Geller Rudman & Dowd, Lynn Lincoln Sarko of Keller Rohrback and Rex Sharp of Sharp Law.
The steering committee is chaired by Elizabeth Pritzker of Pritzker Levine and also includes Sharon Almonrode, Eric Hochstadt, Mark Lanier, Damien Marshall, Rosemary Rivas and Steven Williams.
The defendants are represented by Hogan Lovells (lawyers include Adam Levin, Benjamin Holt, David Foster and Justin Bernick); Lathrop Gage and Robbins Russell Englert Orseck Untereiner & Sauber.
Weil Gotshal & Manges is representing Sanofi.
Last year, Mylan paid the feds $465 million to settle a False Claims Act suit alleging that the company knowingly misclassifying EpiPen as a generic drug to avoid paying rebates owed primarily to Medicaid.
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Ninth Circuit Remands Golden Oldies Copyright Case
Two years ago, lawyers from Irell & Manella notched one of those too-good-to-be-true wins.
Based on a novel theory, they convinced a federal judge in Los Angeles to dismiss a potentially massive copyright class action against CBS Corp. and CBS Radio on summary judgment.
It was nice while it lasted, but on Monday, the U.S. Court of Appeals for the Ninth Circuit in no uncertain terms reversed and remanded just about every piece of the decision by Judge Percy Anderson.
CBS was sued in 2015 by four record companies that own pre-1972 sound recordings by artists such as Al Green, the Everly Brothers, Andy Williams, Jackie Wilson and The Chi-Lites. (Under the Sound Recording Act, sound recordings fixed after February 15, 1972, are subject to a compulsory license regime that's not in dispute here.)
Represented by McKool Smith, the companies said CBS had no right to air the pre-1972 recordings without obtaining a license from them.
But Irell lawyers responded that the recordings used for radio broadcast were not actually the originals. Rather, they said, their client was playing new, remastered versions of those recordings, covered by a new federal copyright. Therefore, the plaintiffs' state law-based claims were eliminated.
So … no.
The Ninth Circuit panel focused on whether a remastered sound recording could be eligible for independent copyright protection. The only way that could happen is if the “essential character and identity” of the recordings distinguish them from the underlying work, wrote Judge Richard Linn, sitting by designation from the U.S. Court of Appeals for the Federal Circuit.
And that's where CBS fell short.
“A remastering, for example, of Tony Bennett's 'I Left My Heart in San Francisco' recording from its original analog format into digital format, even with declicking, noise reduction and small changes in volume or emphasis, is no less Bennett's 'I Left My Heart in San Francisco' recording—it retains the same essential character and identity as the underlying original sound recording, notwithstanding the presence of trivial, minor or insignificant changes from the original,” he wrote, with Judges Marsha Berzon and Paul Watford concurring. “That is so even if the digital version would be perceived by a listener to be a brighter or cleaner rendition.”
The remasters, Linn continued, “lacked the originality necessary to support copyright protection as derivative works.”
The record companies—ABS Entertainment Inc., Barnaby Records, Brunswick Record Corp. and Malaco Inc.—were represented by McKool's Robert Allen, who handled the oral argument, as well as Alan Block, Roderick Dorman, and Lawrence Hadley. Chicago's Miller Law was co-counsel.
The case also attracted significant amicus interest.
The Recording Industry Association of America, represented by Cowan Liebowitz & Latman, backed the record companies, as did the California Society of Entertainment Lawyers, represented by Gerard Fox Law and Lowe and Associates. Sound recording owner Flo & Eddie Inc., with counsel from Susman Godfrey and Gradstein & Marzano, was also on the record companies' side.
The National Association of Broadcasters, represented by Paul Hastings, supported CBS, as did iHeartMedia, with counsel from Latham & Watkins.
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Shout Out: Kirkland Soars for Boeing
Kirkland & Ellis is gaining elevation in a long-running fight over the Air Force's KC-135 aircraft fleet.
Last week, a federal judge in the Northern District of Alabama sided largely with Kirkland client Boeing, which was sued by Alabama Aircraft Industries for breach of contract and other claims.
The dispute stems from a $1 billion government contract to perform maintenance on the KC-135 fleet—so-called stratotankers used for mid-air refueling.
U.S. District Judge R. David Proctor kicked off his 47-page summary judgment opinion with an endearing disclaimer: “Because this case involves Department of Defense contracting, the parties' briefing and this court's opinion are replete with abbreviations and acronyms. The court apologizes in advance.”
Among his key findings: That sophisticated parties like Boeing and Alabama Aircraft have the freedom to limit future remedies, and that courts are not sympathetic to a party that did not understand the consequences of its actions. He also threw out Alabama Aircraft's fraud claim, finding that Boeing did not suppress any information related to the parties' pricing negotiations when they were working together.
Kirkland partners Craig Primis and Erin Johnston represent Boeing in the case.
The Justice Department is opposing a supplemental award of fees and costs in a landmark $680 million settlement for Native American farmers and ranchers.
It's a nice win for the performers' lead counsel, Andrew Langsam of Pryor Cashman.
More than 80 class actions alleged the companies committed “insider trading” by allowing their employees to participate in contests using nonpublic information, or they enticed consumers to participate in illegal gambling.
A Colorado law firm is urging a federal appeals court to curb the agency's authority to unilaterally determine that state-legal businesses are breaking federal law.
The class action complaint alleges that Google's collection of location data “against the express wishes and expectations of its users” violates California's privacy law.
He allegedly stole the identity of a real attorney, set up a fake law office and scammed dozens of would-be clients out of fees. I feel like it might have been easier just to go to law school
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