PHILADELPHIA – A federal judge is permitting an opportunity for parties involved in a massive multi-district antitrust litigation surrounding the pricing of generic drugs to argue which cases would or would not make proper choices as bellwether cases, prior to that list being finalized.
U.S. District Court for the Eastern District of Pennsylvania Judge Cynthia M. Rufe issued a decision on Feb. 9, allowing defendant Teva Pharmaceuticals to argue its position for reconsidering the choice of the bellwether trials associated with the action at hand.
“The indictment concerns the alleged price-fixing of 13 drugs, all of which are in the States’ Teva-centric complaint, including pravastatin, which is one of the single-drug bellwether cases (clobetasol and clomipramine are not part of the criminal case). Teva, joined by Glenmark, argues that the indictment, as well as pending criminal charges in a separate case against Ara Aprahamian, fundamentally undermine the suitability of the Teva-centric and pravastatin cases as effective bellwethers,” Rufe explained.
“According to Teva, the possibility that key witnesses will assert their rights against self-incrimination will leave gaps in the factual record and in the alternative, the possibility that the witnesses will testify will cause Teva severe hardship as it will provide a preview of Teva’s defenses in the criminal case.”
The plaintiffs oppose the defense’s motion for reconsideration arguing that changing the bellwether cases now would set back the entire course of the MDL, and since the MDL cases contain many overlapping defendants and witnesses, those issues would arise no matter which cases are selected as bellwethers.
While Teva expressed concerns that the government might use discovery in the bellwether cases to obtain a strategic advantage in the criminal case, the plaintiffs countered that the Court could seal discovery and prevent the use of depositions outside of the MDL, not to mention that choosing different bellwether cases would exclude certain key defendants from moving toward trial at this juncture.
“The Court reached the bellwether decision after careful consideration and the parties have moved forward in reliance on that decision for the last several months. However, the indictment of the key corporate defendant in the Teva-centric and pravastatin bellwether cases constitutes a significant change in circumstances,” Rufe said.
“Although plaintiffs argue that only three of the 35 defendants in the Teva-centric case are facing criminal charges and that many more drugs are at issue than are cited in the indictment, the amended complaint is undeniably structured with a focus on Teva, defining the alleged schemes as Teva/Mylan, Teva/Sandoz, Teva/Lupin, and so forth. In the two bellwether cases at issue, Teva is not simply one defendant among many.”
Rufe explained that the impact of the filing of the indictment on the MDL proceedings is magnified by the ongoing COVID-19 pandemic, leading to “a risk of delay and of scheduling conflicts” with associated criminal cases.
“Plaintiffs may be correct that the complications discussed above can be managed, but seeing the rocky shoals ahead, the Court deems it prudent to adjust course now, rather than risk capsizing the progress of the MDL when it is too late to turn back,” Rufe stated.
“As the Court previously held, the purpose of a bellwether selection is to determine a course that is reasonable and fair and ‘will promote the just and efficient conduct of’ the cases constituting the MDL. The Court is no longer convinced that the prioritization of the Teva-centric and pravastatin cases will achieve that goal.”
Rufe concluded that the parties will have an opportunity to plead their cases before the final selection of the bellwether cases.
“The state plaintiffs’ case centered on Heritage Pharmaceuticals, Inc., was filed before the Teva-centric case and was considered as an alternative in the original bellwether selection, and the Court is confident that it is an appropriate choice for a bellwether along with the clomipramine and clobetasol DPP and EPP proposed class actions. However, the Court will grant the parties a (brief) opportunity to be heard before finalizing the selection.”
U.S. District Court for the Eastern District of Pennsylvania case 2:16-md-02724
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com