Antitrust: In Re Ciprofloxacin Hydrochloride Antitrust Litigation

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U.S. Court of Appeals for the Second Circuit

Antitrust

Patent Infringement — Reverse Exclusionary Payment Settlements

In Re Ciprofloxacin Hydrochloride Antitrust Litigation
05-2851-cv
Appealed from the Eastern District of New York

Background: Plaintiffs appeal from a judgment of the U.S. District Court for the Eastern District of New York granting summary judgment for defendants, manufacturers of the antibiotic ciprofloxacin hydrochloride or generic bioequivalents of Cipro. Plaintiffs argue that defendants violated Section 1 of the Sherman Act when they settled their dispute concerning the validity of Bayer’s Cipro patent by agreeing to a reverse exclusionary payment settlement. Bayer agreed to pay the generic challengers, and in exchange the generic firms conceded the validity of the Cipro patent. After the district court entered judgment, a panel of the court held that reverse payment settlements of patent lawsuits do not violate antitrust laws.

Ruling: Because Joblove v. Barr Labs., Inc., (In re Tamoxifen Citrate Antitrust Litig.), 466 F.3d 187, 208-12 (2d Cir. 2005) is dispositive of plaintiffs’ claims, the court affirms. However, because of the “exceptional importance” of the antitrust implications of reverse exclusionary payment settlements of patent infringement suits, the court invites the plaintiffs-appellants to petition for rehearing in banc.

Steve D. Shadowen, of Hangley Aronchick Segal & Pudlin, for the appellants and Fred H. Bartlit Jr., of Bartlit Beck Herman Palenchar & Scott LLP, for defendants Bayer AG and Bayer Corporation