Antitrust and Consumer Protection
Competition: Fall 2015, Vol 24, No. 2
Content
- A Tale of Two Statutes: Cipro, Edwards, and the Rule of Reason
- Antitrust Treatment of State Licensing Boards In the Wake of North Carolina State Board of Dental Examiners V.F.T.C.
- Breaking a Monopoly: Vigilante Justice or the Sort of Innovative Approach We Celebrate?
- Capitalizing On Judicial Antitrust Experience
- Chair's Column
- Editor's Note
- Health Care Merger Analysis In the Era of Payment Reform
- Masthead
- Mobile Apps: Redefining the Virtual California Economy and the Laws That Govern It
- Off-label Use of the Cartwright Act: Will Cipro Require State Courts To Assess Federal Patent Validity In Pay-for-delay Cases?
- Pleading An Antitrust Conspiracy In a Post-twombly World
- Promoting Antitrust Compliance the Antitrust Division's Subtle Shift Regarding Corporate Compliance: a Step Toward Incentivizing More Robust Antitrust Compliance Efforts
- Table of Contents
- The Antitrust and Unfair Competition Law Section
- The Magna Carta and the Sherman Act
- The Northern District of California Opens Its Doors To the World's Civil Antitrust Disputes
- What You See Isn't What You Get: How the Colgate Doctrine May Apply To the Disposable Contact Lens Antitrust Litigation
- Putting Cipro Meat On Actavis Bones: a Case Study In Filling In the Legal Gaps
PUTTING CIPRO MEAT ON ACTAVIS BONES: A CASE STUDY IN FILLING IN THE LEGAL GAPS
By Jordan Elias1
Justice Cardozo summed up the essential challenge of deciding cases with a single sentence: "There are gaps to be filled."2 Gap-filling best describes the judicial function that a unanimous California Supreme Court performed this year in its major antitrust decision in the Cipro reverse payment litigation.3 Confronting spaces in the law left by the U.S. Supreme Court in its own recent reverse payment decision—FTC v. Actavis, Inc.4—the California court elaborated at length on why reverse payment agreements must be treated as suspect under the rule of reason and how a reverse payment trial under the Cartwright Act5 must be structured.
The California Supreme Court’s Cipro decision is binding authority as to Cartwright Act claims in state and federal courts and, in my view, should also be persuasive authority for courts interpreting and applying Actavis. As one federal judge remarked, Cipro contains "one of the most thorough and thoughtful discussions of Actavis yet"; it explains "that ‘the period of exclusion attributable to a patent is not its full life, but its expected life had enforcement been sought,’ and that ‘[t]his expected life represents the baseline against which the competitive effects of any agreement must be measured.’"6
The authoritative guidance and reasoning in the Cipro decision should inform the prosecution, management and resolution of reverse payment claims, under California law and otherwise, for years to come.7 Where Actavis left questions, Cipro supplied answers grounded in existing antitrust principles and economic analysis, from the high court of the most populous state. And to the extent Cipro has a lasting effect on the contours of future reverse payment cases, and on antitrust law in general, it will be because the California Justices refused to dodge the issues that have made reverse payments such a conundrum.