Federal Trade Commission v. AbbVie Inc, No. 18-2758 (3d Cir. 2020)
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AndroGel, a testosterone replacement therapy, generated billions of dollars in sales, The Federal Trade Commission sued the owners of an AndroGel patent under Section 13(b) of the Federal Trade Commission Act, 21 U.S.C. 301, alleging that they filed sham patent infringement suits against Teva and Perrigo and entered into an anticompetitive reverse-payment agreement with Teva. The FTC accused the defendants of trying to monopolize and restrain trade over AndroGel. The District Court dismissed the FTC’s claims to the extent they relied on a reverse-payment theory but found the defendants liable for monopolization on the sham-litigation theory. The court ordered the defendants to disgorge $448 million in profits but denied the FTC’s request for an injunction.
The Third Circuit reversed in part. The district court erred by rejecting the reverse-payment theory and in concluding that the defendants’ litigation against Teva was a sham. The court did not err in concluding the Perrigo litigation was a sham and that the defendants had monopoly power in the relevant market. The FTC has not shown that monopolization entitles it to any remedy. The court did not abuse its discretion in denying injunctive relief. The court erred by ordering disgorgement because that remedy is unavailable under Section 13(b).
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