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Valley Drug Co. v. Geneva Pharms., Inc.

United States Court of Appeals for the Eleventh Circuit

November 14, 2003, Decided ; November 14, 2003, Filed

No. 02-10171

Opinion

 [*1183]  TJOFLAT, Circuit Judge:

This case, which involves intersecting questions of antitrust law and class action procedure, comes to us on appeal from the United States District Court for the Southern District of Florida. Louisiana Wholesale Drug Co. ("Louisiana Wholesale") and Valley Drug Co. ("Valley Drug") allege that the defendant Abbot Laboratories ("Abbot"), violated section 4 of the Clayton Act, 15 U.S.C. § 15 2 [**3] , and section one of the Sherman Antitrust Act, 15 U.S.C. § 1 3, when it entered into settlement agreements with defendants Geneva Pharmaceuticals, Inc., ("Geneva") and Zenith Goldline Pharmaceuticals, Inc. ("Zenith") because the effect of the agreements was to preserve Abbot's monopoly position in the market for the drug terazosin hydrochloride [*1184]  by [**2]  keeping Geneva and Zenith's less expensive generic terazosin products off the market. The plaintiffs sought class certification for their antitrust claims under Rule 23(b)(3) 4 of the Federal Rules of Civil Procedure, and on September 20, 2001, the district court granted the plaintiffs' consolidated motions. In re Terazosin Hydrochloride Antitrust Litigation, 203 F.R.D. 551 (S.D. Fla. 2001). 5 Pursuant to Rule 23(f) 6 [**4] , we permitted Abbot and Zenith to appeal the district court's ruling. 7 We now vacate the district court's decision and remand the case for further proceedings.

The facts of this case have been discussed extensively both by the district court and by this court in a companion case, Valley Drug Co. v. Geneva Pharmaceuticals, Inc., 344 F.3d 1294, 2003 U.S. App. LEXIS 19069 (11th Cir. 2003). 8 For the sake of efficiency, this opinion will discuss those facts that are most pertinent to the class certification question before us.

 [**5]  In 1987, Abbot began exclusively marketing the chemical compound, terazosin hydrochloride, under the trademark name "Hytrin." Hytrin, which is used in the treatment of hypertension and benign prostatic hyperplasia, proved to be a profitable drug for the company. According to the Federal Trade Commission ("FTC"), Hytrin generated $ 540 million in sales for Abbot in 1998 alone. This figure constituted more than twenty percent of Abbot's net sales of pharmaceutical products in the United States that year. In re Terazosin Hydrochloride Antitrust Litigation, 164 F. Supp. 2d 1340, 1343 (S.D. Fla. 2000) (hereinafter "In re Terazosin Hydrochloride I"), rev'd Valley Drug v. Geneva Pharmaceuticals, Inc., 334 F.3d 1294 (11th Cir. 2003).

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350 F.3d 1181 *; 2003 U.S. App. LEXIS 23286 **; 2003-2 Trade Cas. (CCH) P74,222; 57 Fed. R. Serv. 3d (Callaghan) 997; 17 Fla. L. Weekly Fed. C 45

VALLEY DRUG COMPANY, LOUISIANA WHOLESALE DRUG CO., INC., Plaintiffs-Appellees, SHERMAN ACT CLASS PLAINTIFFS, Consolidated-Plaintiff-Appellee, WALGREEN CO., INC., DRUG MART PHARMACY CORP., et al., Plaintiffs, HY-VEE, INC., from 99cv1938, STOP & SHOP SUPERMARKET CO., from 99cv1938 et al., Consolidated-Plaintiffs, versus GENEVA PHARMACEUTICALS, INC. Defendant-Appellants, ABBOT LABORATORIES, Defendant-Consolidated-Defendant-Appellant.

Subsequent History: Rehearing, en banc, denied by Valley Drug Co. v. Abbott Labs., 92 Fed. Appx. 783, 2004 U.S. App. LEXIS 6176 (2004)

Class certification granted by, in part, Class certification denied by, in part In re Terazosin Hydrochloride Antitrust Litig., 220 F.R.D. 672, 2004 U.S. Dist. LEXIS 6176 (S.D. Fla., 2004)

Prior History:  [**1]  Appeal from the United States District Court for the Southern District of Florida. D.C. Docket No. 99-01317 MD-PAS.

Valley Drug Co. v. Geneva Pharms., 344 F.3d 1294, 2003 U.S. App. LEXIS 19069 (11th Cir. Fla., 2003)

Disposition: Vacated and remanded.

CORE TERMS

class certification, district court, class member, wholesalers, generic, terazosin, hydrochloride, antitrust, purchasers, defendants', patent, class action, experienced, plaintiffs', parties, branded, drugs, benefitted, generic drug, overcharge, damages, fundamental conflict, settlement agreement, rule requirements, pharmaceutical, antagonistic, manufacturer, products, cases, economic interest

Antitrust & Trade Law, Clayton Act, General Overview, Sherman Act, Civil Procedure, Special Proceedings, Class Actions, Appellate Review, Judicial Discretion, Certification of Classes, Prerequisites for Class Action, Appeals, Standards of Review, Abuse of Discretion, Parties, Joinder of Parties, Numerosity, Commonality, Class Members, Named Members, Typicality, Business & Corporate Compliance, Governments, Agriculture & Food, Product Promotions, Monopolies & Monopolization, Actual Monopolization, Private Actions, Purchasers, Direct Purchasers, Standing, Constitutional Law, Fundamental Rights, Procedural Due Process, Scope of Protection