Showing posts with label justices. Show all posts
Showing posts with label justices. Show all posts

Monday, July 1, 2013

U.S. justices signal uncertainty on drug settlements

By Lawrence Hurley

WASHINGTON, March 25 (Reuters) - U.S. Supreme Court justices on Monday signaled uncertainty over how they would rule on whether brand-name drug companies can settle patent litigation with generic rivals by making deals to keep cheaper products off the market.

Eight justices, lacking the recused Justice Samuel Alito, asked questions that indicated concerns about such deals, but several seemed unsure how courts should approach the matter.

In the deals in question, brand name manufacturers settle litigation by paying generic manufacturers to stay out of the market for a specified period.

U.S. and state regulators say the practice costs consumers, insurers and government billions of dollars annually.

The Federal Trade Commission, which has called the deals "pay for delay," has fought them in court for more than a decade.

A number of justices on Monday appeared skeptical of the Justice Department's argument that the deals should be viewed as presumptively unlawful.

Justice Sonia Sotomayor said she had "difficulty understanding" Justice Department lawyer Malcolm Stewart's argument that "the mere existence" of a payment should change the way courts view a settlement.

But several justices asked questions raising concerns that the deals could be anticompetitive.

Justice Elena Kagan said that in some cases, companies could share monopoly profits "to the detriment of consumers."

The problem the court appears to face is how to tell lower courts to determine which agreements were lawful and which were not.

Justice Stephen Breyer suggested that the justices should simply tell lower court judges to "keep in mind" that the deals could be anticompetitive.

"In other words, it's up to the district court," he said.

It is unclear how many of the justices would support that approach. Justice Antonin Scalia was openly critical, saying it would not tackle "the elephant in the room," which is the relative strength of the patent being challenged in the case. Justice Anthony Kennedy voiced similar sentiments.

In the case before the court, Solvay Pharmaceuticals Inc, which is now owned by AbbVie , sued generic drugmakers in 2003 to stop cheaper versions of AndroGel, a gel used to treat men with low testosterone.

Solvay paid as much as $30 million annually to Actavis Inc

predecessor Watson Pharmaceuticals, Paddock Laboratories Inc and Par Pharmaceutical Cos to help preserve annual profits estimated at $125 million from AndroGel.

Under the deal, the three would stay off the market until 2015. The patent expires in 2020.

The Supreme Court is expected to issue a decision by the end of June.

The case is Federal Trade Commission v. Watson Pharmaceuticals Inc et al, U.S. Supreme Court, No. 12-416.

(Reporting by Lawrence Hurley; Additional reporting by Diane Bartz; Editing by Howard Goller and Lisa Von Ahn)

((lawrence.hurley@thomsonreuters.com 202-898-8397)(Reuters Messaging: lawrence.hurley.thomsonreuters.com@reuters.net))

Keywords: USA COURT/GENERICS


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Saturday, June 29, 2013

U.S. justices signal uncertainty on drug settlements

By Lawrence Hurley

WASHINGTON, March 25 (Reuters) - U.S. Supreme Court justices on Monday signaled uncertainty over how they would rule on whether brand-name drug companies can settle patent litigation with generic rivals by making deals to keep cheaper products off the market.

Eight justices, lacking the recused Justice Samuel Alito, asked questions that indicated concerns about such deals, but several seemed unsure how courts should approach the matter.

In the deals in question, brand name manufacturers settle litigation by paying generic manufacturers to stay out of the market for a specified period.

U.S. and state regulators say the practice costs consumers, insurers and government billions of dollars annually.

The Federal Trade Commission, which has called the deals "pay for delay," has fought them in court for more than a decade.

A number of justices on Monday appeared skeptical of the Justice Department's argument that the deals should be viewed as presumptively unlawful.

Justice Sonia Sotomayor said she had "difficulty understanding" Justice Department lawyer Malcolm Stewart's argument that "the mere existence" of a payment should change the way courts view a settlement.

But several justices asked questions raising concerns that the deals could be anticompetitive.

Justice Elena Kagan said that in some cases, companies could share monopoly profits "to the detriment of consumers."

The problem the court appears to face is how to tell lower courts to determine which agreements were lawful and which were not.

Justice Stephen Breyer suggested that the justices should simply tell lower court judges to "keep in mind" that the deals could be anticompetitive.

"In other words, it's up to the district court," he said.

It is unclear how many of the justices would support that approach. Justice Antonin Scalia was openly critical, saying it would not tackle "the elephant in the room," which is the relative strength of the patent being challenged in the case. Justice Anthony Kennedy voiced similar sentiments.

In the case before the court, Solvay Pharmaceuticals Inc, which is now owned by AbbVie , sued generic drugmakers in 2003 to stop cheaper versions of AndroGel, a gel used to treat men with low testosterone.

Solvay paid as much as $30 million annually to Actavis Inc

predecessor Watson Pharmaceuticals, Paddock Laboratories Inc and Par Pharmaceutical Cos to help preserve annual profits estimated at $125 million from AndroGel.

Under the deal, the three would stay off the market until 2015. The patent expires in 2020.

The Supreme Court is expected to issue a decision by the end of June.

The case is Federal Trade Commission v. Watson Pharmaceuticals Inc et al, U.S. Supreme Court, No. 12-416.

(Reporting by Lawrence Hurley; Additional reporting by Diane Bartz; Editing by Howard Goller and Lisa Von Ahn)

((lawrence.hurley@thomsonreuters.com 202-898-8397)(Reuters Messaging: lawrence.hurley.thomsonreuters.com@reuters.net))

Keywords: USA COURT/GENERICS


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Thursday, May 9, 2013

Supreme Court justices hint at striking Voting Rights Act provision

The Supreme Court on Wednesday appeared likely to strike down a key part of the Voting Rights Act, the landmark civil rights law designed to protect minority voters from discrimination.

The court’s conservative justices were at times hostile to the law’s requirement that states with a history of discrimination gain “preclearance” from the federal government before changing their voting procedures.

Justice Antonin Scalia called the policy an example of “racial entitlement” — a comment that seemed to strike a nerve with Justice Sonia Sotomayor, underscoring the delicate racial politics at play in the case.

Democratic lawmakers, civil rights leaders and hundreds of activists rallied outside the court Wednesday, arguing that the Voting Rights Act is still a necessary tool to fight discrimination. Some lawmakers had to duck out of the arguments halfway through in order to help unveil a statue of Rosa Parks across the street in the Capitol.

“I am proud to stand with my colleagues today to send a clear message to the public and to the court that the right to vote is not a matter of race, entitlement or partisanship,” said Rep. Marcia Fudge (D-Ohio), the chairwoman of the Congressional Black Caucus.

But inside the court’s chambers, lawyers arguing in favor of the Voting Rights Act clearly struggled to convince skeptical conservatives that the preclearance requirements are still needed.

Congress has reauthorized the Voting Rights Act several times, most recently in 2006, but it has not changed the criteria for determining which states and municipalities must get clearance before changing their voting procedures. States bound by the preclearance rules say the outdated rules intrude on their right to set their own election laws.

Scalia suggested that Congress could not be trusted to scrap preclearance requirements when they become outdated. He noted that each time the Voting Rights Act has been reauthorized, it has passed by a wider margin in the Senate. Lawmakers might simply be too timid to vote against it, he said.

“I think it is very likely attributable to a phenomenon that is called perpetuation of racial entitlement,” Scalia said. “It’s been written about. Whenever a society adopts racial entitlements, it is very difficult to get out of them through the normal political processes.”

Rep. James Clyburn (D-S.C.), who attended part of the oral arguments, said Scalia’s comment was “unfortunate.” Equal voting rights are indeed an entitlement, he said — and have been since 1870, when Congress passed the 15th Amendment to the Constitution.

Sotomayor also seized on Scalia’s comments, asking a lawyer arguing against the Voting Rights Act, “Do you think Section 5 was voted for because it was a racial entitlement” and “Do you think racial discrimination has ended?”

Justice Anthony Kennedy, the court’s traditional swing vote, compared the preclearance requirement to previous acts of Congress that worked well in their time but are no longer relevant.

“The Marshall Plan was very good, too — the Northwest Ordinance, the Morrill Act — but times change,” Kennedy said.

Chief Justice John Roberts pursued the same point, pressing Solicitor General Donald Verrilli Jr., who represented the Obama administration, to explain why the preclearance requirements are still necessary.

Verrilli defended the 2006 reauthorization as a “cautious choice” supported by a rigorous set of congressional findings. Some specific forms of discrimination that existed in 1965 are extinct, such as literacy tests, he said, but the point of preclearance is to prevent states from devising new methods of voter suppression.

States and municipalities subject to the Voting Rights Act had to file 3,700 preclearance requests in 2005, but the Justice Department only objected to one proposed change, Roberts said.

He also said the biggest discrepancies in voter turnout and registration are in states that do not have to file preclearance requests.

“Is it the government’s submission that the citizens in the South are more racist than citizens in the North?” Roberts asked Verrilli.

The court’s more liberal members questioned lawyers challenging the preclearance requirements about the lingering specter of racial discrimination, and also questioned whether Shelby County, Ala., which brought the lawsuit, should be able to get itself out of the preclearance requirements by citing improvements in other states.

“Why would we vote in favor of a county whose record is the epitome of what caused the passage of this law to start with?” Sotomayor asked.

Alabama’s voting practices have been successfully challenged more than almost any state in the country, Justice Elana Kagan said, making the state a bad messenger for scrapping the Voting Rights Act’s preclearance requirements.

“I mean, you’re objecting to a formula, but under any formula that Congress could devise, it would capture Alabama,” she said to Bert Rein, the attorney representing Shelby County.

Even before Wednesday’s oral arguments, there were signs that Section 5 might be in trouble. The Supreme Court expressed “serious misgivings” about the provision in a 2009 case, saying the requirements intruded into an area that has traditionally belonged to state and local governments.

The court avoided a broad ruling on constitutional grounds in that case, but its decision to take up the issue again four years later was seen as a strong indication that those misgivings had grown.

President Obama also seemed to signal last week that a loss at the Supreme Court was possible, if not likely. Obama said in a local television interview last week that losing Section 5 of the Voting Rights Act would not cause people to lose their right to vote.

“People will still have the same rights not to be discriminated against when it comes to voting,” Obama said. “You just won’t have this mechanism, this tool, that allows you to kind of stay ahead of certain practices.”

A ruling is expected in late June or early July.

— Updated at 8:23 p.m.

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