GE v. Mitsubishi

A federal jury in Dallas ruled on March 8 that Mitsubishi Heavy Industries, Ltd., had infringed one of General Electric Company’s wind turbine patents and awarded $170 million in lost profits and royalties. The GE win comes in the latest bout in a long-running patent and antitrust dispute.

The company was jointly represented at trial by Nicholas Groombridge of Paul, Weiss, Rifkind, Wharton & Garrison and David Lender of Weil, Gotshal & Manges. Mitsubishi tapped ­ Gerald Ivey of Finnegan, Henderson, Farabow, Garrett & Dunner.

GE filed suit in Dallas federal district court in February 2010 alleging that two patents were infringed. One claim was thrown out by federal district court judge W. Royal Furgeson, Jr., leaving one to be decided at trial.

The current case, however, is just one of several related claims and cross-claims. In related litigation before the International Trade Commission, GE also won a partial court victory on February 29 when the U.S. Court of Appeals for the Federal Circuit ordered the ITC to reconsider its findings that Mitsubishi had not infringed a separate GE patent at issue in another federal patent claim filed by GE in federal district court in Corpus Christi, Texas. (The Corpus Christi case was ongoing at press time.)

Mitsubishi is the plaintiff in two other suits. It is pursuing an antitrust claim against GE in Fayetteville, Arkansas, federal district court that alleges that GE deceived the patent office and filed sham litigation in a scheme to dominate the wind turbine market. It also filed an infringement case against GE in federal district court in ­Orlando, alleging that another patent was infringed by GE. GE has filed for summary judgment in that claim; it is aggressively defending the antitrust claim.

For Plaintiff General Electric Company (Fairfield, Connecticut)

Paul, Weiss, Rifkind, Wharton & Garrison: David Ball, Jr., ­Nicholas Groombridge, and ­associate Andrew Brown. (Groombridge and Brown are in New York; Ball is in Washington, D.C.) The firm was co–lead counsel in the Dallas patent claim.

Weil, Gotshal & Manges: Ray Guy, David Lender, and asso­ciates Carmen Bremer, Anish Desai, and Nick Sethi. (Lender and Sethi are in New York; Desai is in Washington, D.C.; and the others are in Dallas.) The firm was co–lead counsel in the Dallas patent claim.

For Defendant Mitsubishi Heavy Industries, Ltd. (Tokyo) et al.

Finnegan, Henderson, Farabow, Garrett & Dunner: Gerald Ivey and Roger Taylor. (Ivey is in Washington, D.C.; Taylor is in Atlanta.) The firm is lead counsel in the infringement phase of the Dallas litigation.

Steptoe & Johnson: Filiberto Agusti . (He is in Washington, D.C.) The firm led in the inequitable conduct phase of the Dallas litigation.

For Appellee International Trade Commission

In-House: At the Office of General Counsel: General counsel James Lyons, assistant general counsel Wayne Herrington, and attorney James Worth.

For Appellant General Electric Company

Wilmer Cutler Pickering Hale and Dorr: William Lee, Richard O’Neill, Louis Tompros, counsel T. Spence Chubb, and associate Sarah Petty. (Chubb is in Washington, D.C.; the rest are in Boston.) The firm, led by Lee, represented GE, a longtime client, in the Federal Circuit appeal.

For Intervenors Mitsubishi Heavy Industries, Ltd., et al.

Finnegan, Henderson, Farabow, Garrett & Dunner: Donald Dunner, Roger Taylor, and Thomas Winland. (Taylor is in Atlanta; the rest are in Washington, D.C.) The firm, led by Dunner, also represented Mitsubishi before the ITC and in the appeal before the Federal Circuit. –Victor Li, with Tom Coster
 

U.S. v. AU Optronics
Corporation et al.

AU Optronics Corp. and two top executives were found guilty on March 13 of conspiring with rivals to fix prices of its core products. The company, Taiwan’s second-largest maker of display panels for computers and televisions, faces up to $1 billion in penalties, potentially among the largest fines ever imposed in a U.S. criminal antitrust case. At press time the fine had not been set, pending an appeal.

AU Optronics and its Houston-based subsidiary tapped Nossaman’s Christopher Nedeau. Peter Huston, a former Latham & Watkins partner, led the prosecution for the San Francisco office of the U.S. Department of Justice’s antitrust division.

In 2006 the Justice Department, the E.U. Antitrust Commission, and Japan’s Fair Trade Commission announced a probe into possible price-fixing within the liquid crystal display industry. More than a dozen firms in Taiwan, South Korea, and Japan were investigated for involvement in unfair pricing practices. The first penalties against LCD makers were levied in 2008. Since then, seven companies, including LG Electronics Inc. and others, have pleaded guilty and paid criminal fines totaling $890 million; ten executives have been sentenced to jail time.

AU Optronics was the only LCD firm charged in the United States to seek a trial. Federal prosecutors accused company executives of secretly meeting with other panel makers in karaoke bars, hotel rooms, and tea houses in Taiwan from 2001 through 2006 for so-called crystal meetings. According to prosecutors, executives arranged to raise prices for LCD purchasers such as Dell Inc. and Apple Inc.

In April 2011, San Francisco federal district court judge Susan Illston rejected a motion to dismiss on jurisdictional grounds; the case went to trial in January.

Two convicted executives, Hsuan Bin Chen and Hui Hsiung, face up to ten years in prison; their sentencing hearings have not yet been scheduled. Two other executives were acquitted, including former chief executive Lai-Jun Chen, who remains an AU Optronics executive. A mistrial was declared for a fifth.

An appeal, which defense lawyers involved said would come within the next few months, will focus on whether a U.S. statute outlawing conduct that curbs fair competition can be used against companies for actions outside the country, defense lawyers say.

For Plaintiff the United States of America

In-House: At the U.S. Department of Justice’s antitrust division: Assistant chief of the antitrust division’s San Francisco office Peter Huston, and trial attorneys Jonathan Jacobs, Kristen Limarzi, Lidia Maher, Kate Patchen, Christopher Ries, Michael Scott, Brent Snyder, Heather Tewksbury, and Micah Wyatt.

For Defendant AU Optronics Corp. (Hsinchu, Taiwan)

Nossaman: Carl Blumenstein, Paul Knight, Christopher Nedeau, and associate Chi Soo Kim. (Knight is in Washington, D.C.; the rest are in San Francisco.) The firm was lead trial counsel in this and in a separate class action where consumer electronics retailers are suing the LCD maker over antitrust claims related to the price-fixing case.

Sedgwick: Michael Healy and Kirk Jenkins. (Jenkins is in Chicago; Healy is in San Francisco.) The firm was cocounsel for AU Optronics at trial.

For Defendant AU Optronics Corporation America (Houston)

Law Office of John D. Cline: John Cline. (He is in San Francisco.) Cline was lead counsel at trial.

Law Office of K.C. Maxwell: K.C. Maxwell. (She is in San Francisco.) Maxwell was cocounsel with Cline at trial.

For the individual defendants

Riordan & Horgan: Donald Horgan and Dennis Riordan. (They are in San Francisco.) The appellate firm is cocounsel for all the defendants and is seeking new trials for the two convicted executives.

For Defendant Lai-Jun Chen

Law Offices of Brian H. Getz: Brian Getz. (He is in San Francisco.) Getz is representing the former AU Optronics president and CEO. He was lead counsel at trial.

Shearman & Sterling: Patrick Robbins and associate Mikael Abye. (They are in San Francisco.) The firm was brought into the case by Getz, who has argued many cases opposite Robbins. The firm was cocounsel.

For Defendant Hsuan-Bin Chen

Cooley: Michael Attanasio and associate Jennifer French. (They are in San Diego.) The firm represented the former president of AU Optronics and current vice-chairman of its board at the trial.

For Defendant Hui Hsiung

Law Office of Brian P. Berson: Brian Berson. (He is in San Francisco.) Berson was lead defense counsel for AU Optronics’s former executive vice president at trial.

Law Offices of William L. Osterhoudt: William Osterhoudt. (He is in San Francisco.) Osterhoudt was cocounsel.

For Defendant Tsannrong Lee

Law Offices of Brendan Conroy: Brendan Conroy. (He is in San Francisco.) Conroy represented the former senior manager of AU Optronics’s notebooks division at the trial.

For Defendant Hsiu Lung Leung

Cashman Law Offices: Dennis Cashman and Dara Cashman. (They are in San Francisco.) The firm represented the former senior manager of AU Optronics’s desktop display division at trial. —Tania Karas

In Re Propoxyphene
Products Liability Litigation

With help from a key U.S. Supreme Court ruling last term on federal preemption, generic drug makers scored a ruling in March that could wipe out hundreds of claims that the companies wrongfully marketed generic versions of the pain reliever Darvon.

On March 5 federal district court judge Danny Reeves in Covington, Kentucky, dismissed nearly three dozen suits in federal multidistrict litigation over the painkillers, citing the Supreme Court’s June 2011 ruling that federal generic drug regulations preempt state law failure-to-warn claims.

The decision will directly affect 33 consolidated suits in the case, and could ultimately apply to more than 700 claims pending against generic defendants in the MDL, defense lawyers said.

Skadden, Arps, Slate, Meagher & Flom’s Mark Cheffo and Greenberg Traurig’s Lori Cohen argued the motion to dismiss for their respective generics clients, Vintage Pharmaceuticals, LLC, and Teva Pharmaceuticals USA, as well as for several other defendants. The MDL itself includes 167 suits, including many with multiple plaintiffs. Plaintiffs lawyers could still file another 3,000–8,000 claims.

Plaintiffs lawyers tried to skirt the preemption issue by arguing that they no longer claimed that the defendants failed to warn consumers about the potential harm of taking generic Darvon. Instead, they contended, the companies “wrongfully marketed an unreasonably dangerous product” that they should have withdrawn based on evidence that it harmed patients. But Judge Reeves rejected those arguments, writing that the plaintiffs did not sufficiently demonstrate that their so-called wrongful marketing claims escape preemption.

Defense lawyers for the generic companies have previously been successful in relying on the Supreme Court’s ruling in Pliva, Inc. v. Mensing to knock out litigation over generic versions of the drugs Aredia and Fosamax.

For the Plaintiffs

Behnke Martin Schulte: Stephen Behnke and Richard Schulte. (They are in Dayton.) Schulte was apponted co–lead plaintiffs counsel.

RodaNast: Dianne Nast and asso­ciate Michele Burkholder. (They are in Philadelphia.) The firm was also co–lead plaintiffs counsel.

The Center for Constitutional Litigation: Louis Bograd. (He is in Washington, D.C.) Bograd presented the oral arguments.

Sutton Rankin Law: Harry Rankin. (He is in Edgewood, Kentucky.) The firm was liaison counsel.

For Defendant Vintage Pharmaceuticals, LLC (Huntsville, Alabama) et al.

Skadden, Arps, Slate, Meagher & Flom: Mark Cheffo, J. Russell Jackson, counsel Katherine Armstrong, and associates Elliott Davis, Rachel Passaretti-Wu, and Lincoln Wilson. (They are in New York.) The firm was co–lead counsel for the defendants’ steering committee.

For Defendant Teva Pharmaceuticals USA (North Wales, Pennsylvania) et al.

Greenberg Traurig: Lori Cohen, José Isasi II, Victoria Lockard, counsel Sara Thompson, asso­ciates Jessica Cabral, Laura Gleen, and Cliff Merrell. (Isasi is in Chicago; Gleen is in Washington, D.C.; the rest are in Atlanta.) The firm has long represented Teva on corporate matters; it was co–lead counsel on the defendants’ steering committee.

For Defendant Xanodyne Pharmaceuticals, Inc. (Newport, Kentucky)

Ulmer & Berne: Linda Maichl, Gina Saelinger, Joseph Thomas, and associate Joshua Klarfeld. (Klarfeld is in Cleveland; the rest are in Cincinnati.)

For Defendant Eli Lilly and Company (Indianapolis)

Ice Miller: Mary Larimore, Kimberly Metzger, and asso­ciates Audra Ferguson-Allen and Dominique Price. (They are in Indianapolis.) The firm did not respond to a request for comment.

For Defendant Covidien Inc. ­(mansfield, massachusetts) et al.

Shook, Hardy & Bacon: Deborah Moeller, counsel Bryan Pratt, and associate Kelly Bieri. (They are in Kansas City, Missouri.) The firm did not comment. —Nate Raymond, with T.C.

On March 1 a federal district court judge in Manhattan thwarted a settlement that was designed to bring to a close three decades of litigation and to compensate claimants exposed to asbestos. The decision found that a $500 million settlement with The Travelers Indemnity Company—the insurer of the onetime asbestos manufacturer Johns-Manville Corporation—was unenforceable. Judge John Koeltl found that a key condition of the settlement—Traveler’s immunity from future suits—was undermined by an appellate court ruling.

In Re Johns-Manville
Corporation et al.

Plaintiffs filed complaints against Johns-Manville beginning in 1982 claiming that they were harmed by asbestos made by the company, once the nation’s largest producer of the carcinogenic insulation material. Travelers, the company’s insurer, consented in three agreements in 2003 and 2004 to pay three classes of plaintiffs $445 million in exchange for a final court order releasing it from future claims. Five more years of appeals followed when Chubb Insurance Company, concerned about its own indemnity claims against Travelers, challenged the deal. In December 2010, the bankruptcy judge handling Johns-Manville’s bankruptcy, Judge Burton Lifland, ordered Travelers to pay plaintiffs $445 million plus interest.

Travelers appealed to the district court, arguing that the deal no longer provided the contractual immunity from claims it was intended to receive. Judge Koetl agreed, finding that a 2010 decision by the U.S. Court of Appeals for the Second Circuit invalidated the 2003–04 agreements, because the decision opened the door to indemnity claims against Travelers by Chubb. “While Travelers was willing to pay the additional $500 million to obtain complete peace through a clarification that any and all claims against it . . . were enjoined,” he wrote, “this is not the relief Travelers obtained” following the Second Circuit decision.

Plaintiffs attorneys filed a notice of appeal in late March.

For Common Law Plaintiffs

Goldberg Kohn: Ronald Barliant and associate Danielle Juhle. (They are in Chicago.) The firm was lead counsel.

For Statutory and Hawaii Direct Action Settlement Plaintiffs

Milberg: Kent Bronson and Matthew Gluck. (They are in New York.) Gluck had come to the attention of the plaintiffs on previous work while at Fried, Frank, Harris, Shriver & Jacobson.

For Asbestos Personal Injury Plaintiffs

Stutzman, Bromberg, Esserman & Plifka: Sander Esserman and Cliff Taylor. (They are in Dallas.)

For Defendants The Travelers Indemity company (Hartford) et al.

Simpson Thacher & Bartlett: Andrew Frankel, Barry Ostrager, and associates David Edwards and Bryce Pashler. (They are in New York.) The firm has represented Travelers on this matter since 1982. Ostrager negotiated Travelers’s original exit from liability via the Manville Trust in 1986, the 2004 settlement with asbestos claimants, and subsequent appeals. —V.L., with T.C.

E-mail: big.suits@alm.com.

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