Pennsylvania Federal Court Rejects Claims that Patent Infringement Actions Were “Sham” Litigation in Violation of Antitrust Law

The U.S. District Court for the Eastern District of Pennsylvania dismissed claims that the manufacturers and distributors of the antidepressant medication Wellbutrin XL committed antitrust violations by filing sham patent litigation against potential generic competitors and by filing a citizen petition with the U.S. Food and Drug Administration (“FDA”) for the purpose of delaying FDA approval of generic versions of the drug. In re Wellbutrin XL Antitrust Litigation, Nos. 08-cv-2431 & 08-cv-2433, 2012 WL 1657734 (E.D. Pa. May 11, 2012). The defendants, Biovail Corporation, GlaxoSmithKline PLC, and related companies, persuaded the court that their conduct was shielded from liability by the Noerr-Pennington doctrine recognized in Professional Real Estate Investors, Inc. v. Columbia Pictures Industries, Inc., 508 U.S. 49 1993); California Motor Transportation Co. v. Trucking Unlimited, 404 U.S. 508 (1972); United Mine Workers of America v. Pennington, 381 U.S. 657 (1965); and Eastern R.R. Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127 (1961).

The Noerr-Pennington doctrine holds that the First Amendment to the U.S. Constitution protects the right to petition all types of government entities, including the right to bring legitimate disputes to courts for judicial resolution. The doctrine is subject to an exception for activities that are “a mere sham to cover … an attempt to interfere directly with the business relationships of a competitor.” In order to establish that activity that otherwise is immune under Noerr-Pennington is actionable sham conduct, a plaintiff must prove—

  1. That the defendants’ conduct is “objectively baseless in the sense that no reasonable litigant could realistically expect success on the merits; and
  2. That the baseless suit or petition “conceals an attempt to interfere directly with the business relationships of a competitor through the use of the governmental process—as opposed to the outcome of that process—as an anticompetitive weapon.”

As to three of the four patent lawsuits which the plaintiffs alleged to be sham actions, the court found that the defendants’ proposed patent claim constructions and theories of patent infringement liability were not objectively baseless. As to the fourth lawsuit, the court found no evidence to support the plaintiffs’ contention that the litigation had delayed the entry of generic competition. The court noted that the citizen’s petitions to the FDA had been partially successful, and determined that there was no evidence that the unsuccessful portions of the citizens petitions had produced any injury. Lastly, the court found no evidence to support the plaintiffs’ claims that the defendants had acted in a collusive manner either in pursuing litigation or filing citizen’s petitions.

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