A judicial panel’s move to send drug price-fixing lawsuits back to Connecticut highlights the increasing trend of states effectively litigating antitrust cases within their own jurisdiction.
The US Judicial Panel on Multidistrict Litigation recently rejected an attempt by major drug manufacturers to consolidate the cases into multidistrict litigation in Pennsylvania. This decision was based on a law that grants state attorneys general more control over the location of their antitrust cases, alleging that the expanded application of this law could offer plaintiffs a home-state advantage and expedite litigation by allowing states to move lawsuits out of multidistrict proceedings.
The Connecticut case involves claims that around 40 pharmaceutical companies collaborated to artificially raise the price of generic drugs and suppress competition. The state’s Attorney General, William Tong, expressed satisfaction at the prospect of these significant cases proceeding in Connecticut.
According to Roger Alford, a professor at Notre Dame Law School and an expert on antitrust law, congressional emphasis on the importance of speed in enforcement will influence the decision-making of state attorneys general. This consideration will be a factor in their strategic approach to future cases.
Three of the defendants in the case—Teva Pharmaceutical Industries Ltd., Sandoz Group AG, and Aurobindo Pharma Ltd.—raised concerns about transferring the case out of Pennsylvania. They argued that doing so would create chaos and force them to litigate the same allegations and claims in multiple locations, given that the drugmakers are also facing several class action lawsuits related to allegations of price-fixing.
Read More: Teva, Drug Manufacturer Antitrust Cases Sent Back to Connecticut
Concerns of Companies
Other companies involved in state-led antitrust suits have also voiced concerns about the burden of duplicating litigation and have asserted that multidistrict litigation is a more efficient approach.
In December 2022, the State Antitrust Enforcement Venue Act created an additional challenge for defendants, who would now have to combat the same fight in different jurisdictions, rather than proceeding efficiently. However, some experts have cautioned against the notion that piecemeal separate litigation in each state where a state AG has brought claims would lead to swifter resolutions.
Several recent developments have illustrated the states’ success in moving their antitrust cases back to their own jurisdiction. For example, a federal judge recently allowed Arkansas to retain its antitrust lawsuit against pesticide makers Syngenta AG and Corteva Inc. in the state rather than consolidating it in North Carolina, citing the Venue Act in support of the decision.
Moreover, a coalition of states led by Texas was permitted to move their antitrust case against Alphabet Inc.’s Google back to Texas federal court, citing the 2022 law. This demonstrates the growing alignment between state attorneys general and federal antitrust enforcers at the Justice Department, who already had the authority to select the location for litigating their antitrust cases.
Expediting Legal Proceedings
The Venue Act has been observed to allow enforcement cases to move faster and not become entangled with class cases, which require significant considerations such as class certification. This observation has led to attorneys general leveraging the Act in antitrust litigation to expedite legal proceedings.
Professionals involved in cases affected by the Venue Act have observed faster progress in legal proceedings, underlining the potential impact of the law. Ultimately, this procedural shift can have substantial implications for the outcome of the case and determines how it unfolds.