Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES NEWS: Cosmetics company seeks Supreme Court review of FDCA preemption of state unfair competition claims, (May 27, 2014)

By Greg Hammond, J.D.

Athena Cosmetics, Inc. has filed a petition for certiorari, seeking review of the Federal Circuit’s ruling that the Federal Food, Drug, and Cosmetic Act (FDCA) did not preempt claims that Athena violated the California Unfair Competition Law (UCL) by marketing, selling, and distributing hair and eyelash growth products as cosmetics and without a new drug application approved by the Food and Drug Administration. The petition was filed on May 15 (Athena Cosmetics, Inc. v. Allergan, Inc., Dkt. 13-1379).

Allergan, Inc. manufactures, markets, and distributes pharmaceutical, dermatological, and neurological products in the U.S., including Latisse, a U.S. Food and Drug Administration (FDA) approved prescription drug that contains prostaglandin derivative and is used to affect eyelash growth. Athena is a manufacturer and marketer of cosmetic products, including a line of RevitaLash products, some of which also contain prostaglandin derivative. Allergan filed suit against Athena, alleging unfair competition in violation of California’s Unfair Competition Law (UCL) and the Health and Safety Code for marketing, selling, and distributing hair and eyelash growth products as cosmetics and without an FDA approved new drug application.

After determining that Athena’s eyelash growing RevitaLash products qualified as drugs, the federal district court in Santa Ana, California issued a nationwide injunction, preventing Athena from selling those products. However, the Federal Circuit partially disagreed with the district court, finding that a nationwide injunction was an overbroad remedy, and narrowing it to California.

Petition for certiorari. According to Athena’s petition for certiorari, the question presented is whether “the FDCA impliedly preempts a private state-law claim for unfair competition premised on a party’s purported failure to obtain FDA approval, where FDA itself has not imposed any such requirement.”

In support of its position, Athena set forth three reasons why the U.S. Supreme Court should grant its petition. First, the Supreme Court should grant the petition because the Federal Circuit’s decision created a direct circuit split among circuit courts. Athena noted that the Second, Sixth, and Ninth Circuits, as well as various district courts, have held similar claims impliedly preempted under the FDCA. Second, because of the Federal Circuit’s decision and the subsequent split among circuit and district courts, Athena argues that there is a deep confusion regarding whether the FDCA bars private suits under state unfair-trade-practices statutes based on an alleged failure to obtain FDA approval. Lastly, Athena argues that its case raises issues of national importance that warrant the Court’s immediate attention. Specifically, Athena alleges that the Federal Circuit’s decision poses a threat to the uniformity and consistency of upholding the FDCA, and the decision further opens the door to a wave of novel and usurpative private lawsuits.

According to the Supreme Court, Allergan’s response to Athena’s petition for certiorari is due on or before July 18, 2014.

Companies: Allergen, Inc.; Athena Cosmetics, Inc.

News: StateUnfairTradePractices