Antitrust Law Daily Wrap Up, SUPREME COURT DOCKET: Recent decisions, cases, and petitions pending High Court review, (Nov 18, 2015)

By Greg Hammond, J.D.

This Antitrust Law Daily feature presents a chart highlighting the decisions, arguments, briefs, and petitions on antitrust and trade regulation issues before the 2015 Term of the U.S. Supreme Court.

To date, there are 19 antitrust and trade regulation cases that are awaiting Supreme Court Review. Since the opening of the October 2015 term, the Court has granted summary disposition in one advertising case; granted review in three other cases involving advertising, privacy, and the Racketeer Influenced and Corrupt Organizations Act (RICO); and denied review in eight cases concerning advertising, antitrust, consumer protection, franchising & distribution, and RICO.

Advertising, class settlements. Three retired pro-football players are asking the U.S. Supreme Court to review a decision by the U.S, Court of Appeals in St. Louis, which affirmed the approval of a class settlement involving claims that the National Football League (NFL) used retired NFL players’ names, images, and likenesses without the players’ authorization. The questions presented are: (1) whether a Rule 23(b)(3) class settlement that provides no guaranteed benefit to readily identifiable class members in exchange for the release of their damages claims satisfies the requirement of Rule 23(e)(2) that a settlement binding class members must be “fair, reasonable, and adequate”; and (2) whether Rule 23(e)(2) and principles of aggregate litigation require the district court, as a fiduciary, to evaluate the potential value of the damages claims released by class members (Marshall v. National Football League, Dkt. 15-645).

Unfair trade practices, drug labeling. Ortho-McNeal-Janssen Pharmaceuticals, Inc. (Janssen) is challenging a South Carolina Supreme Court decision finding that the pharmaceutical company violated the South Carolina Unfair Trade Practices Act (SCUTPA) by intentionally failing to disclose known risks and side effects associated with its antipsychotic drug Risperdal in both its product labeling and physician letters, ultimately imposing a $124 million civil penalty. The questions presented are: (1) whether a state violates the First Amendment by penalizing a defendant for the content of its speech without requiring proof that the speech contains a knowing or reckless falsehood; (2) whether the Federal Food, Drug, and Cosmetic Act preempts a state enforcement action that serves no compensatory purpose and instead simply seeks to penalize a pharmaceutical company for actions that are comprehensively regulated and overseen by the Food and Drug Administration; and (3) whether the imposition of a $124 million civil penalty, without any showing of actual deception, reliance, or injury, violates the Excessive Fines Clause (Ortho-McNeil-Janssen Pharmaceuticals, Inc. v. South Carolina, Dkt. 15-600).

RICO, enterprise. A group of U.S. government contractor employees, who suffered severe injuries in Iraq and Afghanistan, are asking the Supreme Court to review a decision by the U.S. Court of Appeals in Washington, D.C., which affirmed dismissal of the contractors’ claims brought under the Racketeer Influenced and Corrupt Organizations Act (RICO). The petitioners ask whether RICO can apply to an “enterprise” created by contracting companies, their insurance carriers, and third party administrators who utilize the enterprise to commit fraudulent acts that proximately caused independent harm to covered workers and their families, and thousands similarly situated persons (Brink v. Continental Insurance Co., Dkt. 15-604).

Antitrust, drug monopolization. Allergan plc is asking the High Court to “restore innovators’ patent rights and clarify their antitrust duties” by taking up a decision of the U.S. Court of Appeals in New York City that the brand drug manufacturer contends is “chilling critical efforts to develop life-saving medications.” In its petition, Allergan is questioning the Second Circuit’s decision to affirm a preliminary injunction in a monopolization action brought by the State of New York that requires the drug maker to continue selling an earlier version of an Alzheimer’s drug nearing the end of its patent protection in order to facilitate the use of “bioequivalent” generic drugs (Allergan plc v. New York, Dkt. 15-587).

Advertising, injunctive relief. The American Freedom Defense Initiative is seeking Supreme Court review of a decision by the U.S. Court of Appeals in San Francisco that affirmed denial of preliminary injunction in an action where King County, Washington, rejected a “Faces of Global Terrorism” advertisement on its buses. In its petition, American Freedom claims that the appellate court’s decision conflicts with the majority of other federal courts of appeal; the County’s “false or misleading” ad restriction violates the First Amendment; and the appellate court’s decision finding that American Freedom failed to demonstrate irreparable harm threatens to undermine First Amendment protections (American Freedom Defense Initiative v. King County, Dkt. 15-584).

Antitrust, evidence of conspiracy. Purchasers of pay-per-use (PPU) text messaging services have been denied U.S. Supreme Court review of a decision by the U.S. Court of Appeals in Chicago rejecting their price fixing claims against the nation’s four largest telecommunications carriers. The complaining purchasers’ petition for review questioned the proper approach to direct evidence of an antitrust conspiracy on a motion for summary judgment (Aircraft Check Services Co. v. Verizon Wireless, Dkt. 15-519).

Antitrust, illegal tying. Eastman Kodak Co. and Collins Inkjet Corp. stipulated the dismissal of Eastman Kodak’s petition for review of a decision entered by the U.S. Court of Appeals in Cincinnati, which affirmed an order for preliminary injunction entered against Eastman Kodak for allegedly creating an ink pricing policy that amounted to illegal tying (Eastman Kodak Co. v. Collins Inkjet Corp., Dkt. 15-412).

Privacy, punitive damages. The Supreme Court denied review on November 9 of Westgate Resorts’ challenge to a punitive damage award of $500,000 in a misrepresentation and Telephone Consumer Protection Act (TCPA) action. Westgate Resorts’ had asked: (1) Whether a punitive damages award that is nearly fourteen times the compensatory damages, primarily based upon the defendant’s nationwide wealth, violates the due process clause of the Constitution? (2) Whether awarding punitive damages that are nearly fourteen times compensatory damages based on conduct meeting only one of the Campbell reprehensibility factors violates the due process clause of the Constitution? (Westgate Resorts, Ltd., LP. v. Overton, Dkt. 15-327).

For details about these and other petitions and cases pending before the Supreme Court, please consult the chart of antitrust and trade regulation cases awaiting decision in the 2015 term. Issued opinions, granted petitions, pending petitions, and denied petitions are listed separately, along with a summary of the questions presented and the current status of each case.

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