Corporate & Securities Law

Cipro Decision Affirmed - Reverse Payment Case

By David Fischer

Today, the Federal Circuit affirmed the district court’s decision to dismiss the plaintiffs’ claims.  The opnion is available on the Court’s website (pdf).  This is an interesting and important decision that is worth reading.  A few excepts are below to give you a sense of the decision: 

We conclude that in cases such as this, wherein all anticompetitive effects of the settlement agreement are within the exclusionary power of the patent, the outcome is the same whether the court begins its analysis under antitrust law by applying a rule of reason approach to evaluate the anti-competitive effects, or under patent law by analyzing the right to exclude afforded by the patent. The essence of the inquiry is whether the agreements restrict competition beyond the exclusionary zone of the patent. This analysis has been adopted by the Second and the Eleventh Circuits and by the district court below and we find it to be completely consistent with Supreme Court precedent.

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in the absence of evidence of fraud before the PTO or sham litigation, the court need not consider the validity of the patent in the antitrust analysis of a settlement agreement involving a reverse payment.

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We disagree that analysis of patent validity is appropriate in the absence of fraud or sham litigation.

Full post as published by Antitrust Review on October 15, 2008 (boomark / email).