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United Food & Commer. Workers Unions & Employers Midwest Health Benefits Fund v. Novartis Pharms. Corp.

United States Court of Appeals for the First Circuit

August 21, 2018, Decided

No. 17-1714, No. 17-1776


 [*4]  BARRON, Circuit Judge. In these consolidated appeals from orders dismissing two putative antitrust class actions, purchasers of a brand-name, prescription drug allege that the drug maker unlawfully delayed the entry of generic versions of the drug into the United States market. Specifically, the plaintiffs allege that the drug maker committed antitrust violations by obtaining through a fraud on the United States Patent and Trademark Office ("Patent Office") a patent for a particular form of a component necessary to manufacture a drug to treat leukemia [**2]  and by then seeking to enforce that patent through "sham" infringement litigation against manufacturers trying to enter the market with generic versions of that drug.

The drug maker moved to dismiss the antitrust actions on the ground that there was no fraud and that it was immune from antitrust liability for merely enforcing its patent through litigation. The drug maker claimed this immunity based on the Noerr-Pennington doctrine. See United Mine Workers of Am. v. Pennington, 381 U.S. 657, 669, 85 S. Ct. 1585, 14 L. Ed. 2d 626 (1965); E. R.R. Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127, 136, 81 S. Ct. 523, 5 L. Ed. 2d 464 (1961). ] That doctrine provides a party immunity from antitrust liability for petitioning the government for redress, in light of the First Amendment right to petition the government. And it is clear that the petitioning activity within this  [*5]  doctrine's protection includes enforcing one's intellectual property rights in court. See Prof'l Real Estate Inv'rs, Inc. v. Columbia Pictures Indus., Inc. ("PREI"), 508 U.S. 49, 63-65, 113 S. Ct. 1920, 123 L. Ed. 2d 611 (1993) (applying Noerr-Pennington immunity to copyright infringement litigation); Amphastar Pharms. Inc. v. Momenta Pharms., Inc., 850 F.3d 52, 56-58 (1st Cir. 2017) (applying Noerr-Pennington immunity to patent infringement litigation).

The District Court agreed with the drug maker that Noerr-Pennington immunity applied to its alleged conduct and, on that basis, dismissed the putative class actions under Rule 12(b)(6) of the Federal Rules of Civil Procedure for failure to state a claim. The District Court acknowledged [**3]  that Noerr-Pennington immunity has two exceptions. An antitrust defendant may not enjoy the immunity in enforcing its patent if it obtained that patent through a fraud on the Patent Office, Walker Process Equip., Inc. v. Food Mach. & Chem. Corp., 382 U.S. 172, 177-78, 86 S. Ct. 347, 15 L. Ed. 2d 247 (1965), or if its suit to enforce the patent is a "sham" for impermissible anti-competitive conduct, PREI, 508 U.S. at 51. The District Court held, however, that the purchasers had not plausibly alleged that either exception applies here. We now affirm.

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902 F.3d 1 *; 2018 U.S. App. LEXIS 23284 **; 2018-2 Trade Cas. (CCH) P80,481

UNITED FOOD AND COMMERCIAL WORKERS UNIONS AND EMPLOYERS MIDWEST HEALTH BENEFITS FUND; LABORERS HEALTH AND WELFARE TRUST FUND FOR NORTHERN CALIFORNIA, on behalf of themselves and others similarly situated; AFSCME HEALTH AND WELFARE FUND, on behalf of themselves and others similarly situated; MINNESOTA LABORERS HEALTH AND WELFARE FUND, on behalf of themselves and others similarly situated; PENNSYLVANIA EMPLOYEES BENEFIT TRUST FUND, on behalf of themselves and others similarly situated; LOUISIANA HEALTH SERVICE & INDEMNITY COMPANY, d/b/a Blue Cross and Blue Shield of Louisiana, on behalf of themselves and others similarly situated, Plaintiffs, Appellants, v. NOVARTIS PHARMACEUTICALS CORPORATION; NOVARTIS CORPORATION; NOVARTIS AG, Defendants, Appellees.RXDN, INC., on behalf of itself and on behalf of the Direct Purchaser Class, Plaintiff, Appellant, v. NOVARTIS PHARMACEUTICALS CORPORATION; NOVARTIS CORPORATION; NOVARTIS AG, Defendants, Appellees.


UFCW v. Novartis Pharms. Corp., 2017 U.S. Dist. LEXIS 102389 (D. Mass., June 30, 2017)


patent, imatinib, mesylate, prior art, crystalline, salt, antitrust, immunity, plaintiffs', infringement, sham, patent application, baseless, allegations, anticipation, invention, compound, invalid, misrepresentation, enforcing, disclose, generic, complaints, expiration, motion to dismiss, representations, manufacture, purchasers, discovery, issuance

Antitrust & Trade Law, Exemptions & Immunities, Noerr-Pennington Doctrine, Right to Petition Immunity, Scope, Sham Exception, Sherman Act, Claims, Civil Procedure, Pleadings, Heightened Pleading Requirements, Fraud Claims, Appeals, Standards of Review, De Novo Review, Evidence, Burdens of Proof, Clear & Convincing Proof, Patent Law, Defenses, Patent Invalidity, Presumption of Validity, Anticipation & Novelty, Elements, Nonobviousness, Elements & Tests, Prior Art