IP Law Daily, TRADEMARK—W.D. Wash.: Medical clinics accused of infringing ‘Mounjaro’ and ‘Zepbound’ marks fail to state counterclaims Eli Lilly, (Jul 25, 2025)

By Thomas K. Lauletta, J.D.

Counterclaims for abuse of process and declaratory judgment dismissed.

The U.S. District Court in Seattle, Washington, dismissed counterclaims against the Eli Lilly Company in its trademark suit against Alderwood Surgical Center, which offered compounded medications containing tirzepatide, the active ingredient in Eli Lilly’s FDA approved Mounjaro and Zepbound drugs to treat type two diabetes or excess weight. Alderwood’s counterclaim for abuse of process was dismissed because it failed to show under Washington law that Eli Lilly’s use of process was an improper act. With the dismissal of the affirmative cause of action for abuse of process, the counterclaim for declaratory judgment was also dismissed (Eli Lilly and Co. v. Alderwood Surgical Center LLC, No. 2:24-cv-00878-LK (W.D. Wash. July 23, 2025)).

Plaintiff Eli Lilly and Company is a multinational pharmaceutical company headquartered in Indiana. The defendants are medical clinics in the greater Seattle region and two physicians who operate them.

Eli Lilly sells Mounjaro and Zepbound, the only FDA-approved drugs containing the active ingredient tirzepatide. Mounjaro and Zepbound are prescribed for adults with type two diabetes, obesity, or weight-related medical problems. Eli Lilly alleges that the defendants improperly used its Mounjaro and Zepbound trademarks to promote the sale of the defendants’ compounded tirzepatide to patients, despite not selling either of Eli Lilly’s medicines or being authorized to use Eli Lilly’s trademarks.

On March 7, 2025, the Washington district court dismissed Eli Lilly’s claims under Washington’s Consumer Protection Act but held that Eli Lilly’s federal trademark and false advertising claims were adequately pleaded.

The instant action relates to Alderwood’s counterclaims for abuse of process and for a declaratory judgment. The defendants allege that they lawfully compounded tirzepatide pursuant to the FDA allowing licensed pharmacies and physicians to compound tirzepatide during a shortage of Eli Lilly’s Mounjaro and Zepbound drugs.

Abuse of process counterclaim. Under Washington law, the elements of an abuse of process claim are (1) the existence of an ulterior purpose, that is, to accomplish an object not within the proper scope of the process, and (2) an act in the use of legal process not proper in the regular prosecution of the proceedings.

Here, the court ruled that the defendants had not provided plausible allegations that Eli Lilly committed an improper act in connection with the service of process. Eli Lilly’s settlement demand that the defendants formally admit wrongdoing in their compounding of tirzepatide and advertising it for sale did not qualify as an improper act because it simply sought some of the relief that was asked for in Eli Lilly’s complaint. The court stated that successful abuse of process claims are rare, and that its decision holding that Eli Lilly’s action was not an improper act for purposes of the abuse of process claim “is far from a close call.”

Declaratory judgment counterclaim. The defendants sought a declaratory judgment that their advertising was fair use and did not infringe on Eli Lilly’s trademarks and that the defendant’s advertising was not false or deceptive. The court dismissed the defendants’ counterclaim for declaratory judgment, noting that “the Declaratory Judgment Act does not provide an affirmative cause of action where none otherwise exists.” With the dismissal of the abuse of process counterclaim, there was no ground for granting a declaratory judgment.

Court action. The court granted Eli Lilly’s motion to dismiss without leave to amend.

The Case is No. 2:24-cv-00878-LK.

Judge: King, L.

Attorneys: James F. Hurst (Kirkland & Ellis LLP) for Eli Lilly and Co. Carolyn A. Mount (Miller Nash LLP) for Alderwood Surgical Center LLC.

Companies: Eli Lilly and Co.; Alderwood Surgical Center LLC

Cases: Trademark WashingtonNews