Antitrust Law Daily Wrap Up, ANTITRUST—S.D. Fla.: Deposition of court-appointed forensic expert granted, (Apr 27, 2015)

By Linda O’Brien, J.D., LL.M.

In the discovery phase of an antitrust dispute that stemmed from an agreement between Procaps S.A. and Patheon Inc. to develop and market a branded softgel capsule service for pharmaceutical products, a magistrate judge in the federal district court in Miami has granted Patheon’s motion to depose the court-appointed forensic expert (Procaps S.A. v. Patheon Inc., April 25, 2015, Goodman, J.).

Procaps S.A. is a Columbia-based developer and manufacturer of softgel capsules. Procaps and Patheon entered into a collaboration agreement to market softgel manufacturing and developing services. After Patheon acquired another softgel company, Banner Pharmcaps, Procaps believed that it could no longer perform under the collaboration agreement, claiming that the agreement became an illegal horizontal restraint on trade. When Patheon refused to pay Procaps to leave the agreement or to divest Banner, Procaps filed suit, alleging antitrust violations under the Sherman Act.

Although Procaps filed its suit in December 2012, the company did not implement a formal litigation hold until February 2014, pursuant to a court order. After Procap’s retrieval efforts of certain deleted electronically stored information (ESI) proved inadequate, the parties agreed to the appointment of an independent computer forensic expert to analyze Procap’s ESI and a special master to assist with ESI issues. Subsequently, the court appointed expert issued a report identifying what deleted files could not be recovered. Patheon then moved to dispose the expert.

The court determined that the deposition would benefit both the court and the parties. Federal Rule of Evidence 706 provides that court-appointed expert witnesses may be deposed by any party, According to the court, ESI issues are complex and require detailed, fact-intensive analysis. The expert conducted his forensic analysis for more than a year and produced a report that was thousands of pages in length. In granting Patheon’s motion, the deposition would provide objective and fair testimony that would assist the court in comprehensively and correctly assess the case’s ESI issues. Finally, information from the deposition might cause Patheon not to file its expected motion for sanctions for failure to preserve ESI, the court concluded.

The case is No. 12-24356-CIV-GOODMAN.

Attorneys: Chris S. Coutroulis (Carlton Fields Jorden Burt, PA), and Karen L. Hagberg (Morrison & Foerster) for Procaps SA. David A. Vogel (Cooley, LLP), Derek Eduardo Leon (Leon Cosgrove, LLC), and Robert Mark Brochin (Morgan Lewis & Bockius) for Patheon Inc.

Companies: Procaps S.A.; Patheon Inc.

Cases: Antitrust FloridaNews