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In re: Nexium: Judge Young Denies Defendants’ Motions for a Directed Verdict

Last week, the Nexium district court ruled on defendants’ motions seeking judgment as a matter of law.  As we previously reported in several earlier posts (click here to see our prior coverage), In re: Nexium is the first pay-for-delay case to go to trial since the Supreme Court’s Federal Trade Commission v. Actavis decision.

The Nexium plaintiffs have asserted a novel pay-for-delay theory: that AstraZeneca agreed to accept a reduced settlement payment from Teva in a separate patent infringement litigation involving Prilosec in exchange for Teva’s agreement to delay its launch of Nexium’s generic competitor.  According to plaintiffs, this reduced payment constitutes a large, unexplained payment within the meaning of Actavis.  The theory involves not only Teva but also generic manufacturer Ranbaxy, which also settled a patent infringement case involving generic Nexium.

Although focusing on that novel issue is interesting for blog posts, in their motions defendants smartly focused the court’s attention on the more run-of-the-mill questions facing the court: Can plaintiffs show conspiracy, causation and antitrust injury?  After all, steering a district court towards a well-trodden path on these issues is much easier than convincing the court to take the bigger leap on a novel question: Does the alleged consideration here fall within Actavis?  Defendants probably thought that there was a chance that Judge Young might latch on to one of these issues and resolve the case on a traditional antitrust issue or two. However, Judge Young chose not to engage in a lengthy discussion on any of these issues and, with the exception of a motion addressed to an alleged conspiracy between Teva and Ranbaxy,  simply denied defendants’ motions saying that there are several “prudential reasons” why the case should go to a jury, and noted that concerns about “jumping too quickly” prompted him to deny the directed verdict bids.

It therefore appears that we will see a jury verdict on the novel issue raised in In re: Nexium  and probably post-verdict rulings by district and appellate courts.