Generic Case Proceeds
CAMDEN, N.J. — A federal judge on October 18 refused to dismiss claims that Actelion Pharmaceuticals Ltd. violated antitrust laws by refusing to share samples of its drugs Tracleer and Zavesca with its generic rivals.
Apotex Inc., Actavis Elizabeth LLC, Roxane Laboratories Inc. and other generic-drug companies alleged that Actelion is withholding the samples to block them from bringing low-cost versions to market. The plaintiffs argue that they need the samples to ensure — under federal laws — that generic versions of drug are identical to the brand-name version.
U.S. District Judge Noel Hillman issued a two-page order denying Actelion’s motion for judgment on the pleadings.
Attorneys Will Get Paid
NEW YORK — A federal judge has ruled that the U.S. Securities and Exchange Commission cannot prevent attorneys from being paid by a client to pursue appeals in its case.
U.S. District Judge Robert Sweet ruled last year that Pentagon Capital Ltd. committed securities fraud by engaging in late trading of mutual funds. The U.S. Court of Appeals for the Second Circuit largely affirmed that ruling, leaving the defendants liable for paying more than $60 million.
Pentagon Capital, which is bankrupt, is subject to an SEC asset freeze that restricts the company’s ability to transfer funds. The SEC argued that Pentagon is allowed to pay its lawyers at Pepper Hamilton to comply with the agency’s post-judgment discovery requests, but not to pursue further appeals, including a bid for a Second Circuit rehearing. Sweet ruled that it would result in injustice if Pentagon were precluded from pursuing appellate relief.
Fees Cut in Class Action
SAN FRANCISCO — A federal judge on October 21 slashed attorney fees sought by plaintiffs lawyers in a consumer class action from more than $2.5 million to $943,000.
U.S. District Judge Jeffrey White found that three firms representing consumers in a suit against computer maker Acer America Corp. had billed too many hours, charged too much and overstated the complexity of their case. Consumers had accused Acer America of selling defective laptops in violation of California and federal consumer laws.
Lawyers at those firms — Pearson, Simon & Warshaw; Hausfeld; and Gary, Naegele & Theado — had sought fees based on 4,633 hours of work. Noting the three firms had claimed credit for work on the same tasks, White concluded that 1,750 hours — or 38 percent of the hours sought — would have sufficed.
Goldman Must Foot Bill
NEWARK, N.J. — A federal judge ruled on October 22 that a former Goldman Sachs & Co. vice president’s title demonstrated that he was an “officer” of the company and that he was entitled to advanced money from the company to cover his defense.
U.S. District Judge Kevin McNulty said that the investment bank must “bear the consequence” of bestowing the job title to Sergey Aleynikov, accused of stealing its proprietary source code.
The U.S. attorney’s office indicted Aleynikov in February 2010, ­alleging that he tried to take Goldman trade secrets with him when he left. He was convicted in December 2010 and sentenced to eight years in prison, but that conviction was overturned on appeal last year. State prosecutors in New York later charged him with state crimes. Aleynikov brought a lawsuit against Goldman in September 2012, claiming that the bank had wrongfully refused to pay his legal bills.
Verdict Against BofA
NEW YORK (AP) — A jury on October 23 found Bank of America Corp. liable for mortgage fraud. The verdict was returned after a monthlong civil trial in federal court.
The trial related to mortgages the government said the bank sold quickly without regard to quality as the economy began to decline in late 2007 and 2008.
The jury in the trial before U.S. District Judge Jed Rakoff found Bank of America liable for actions carried out by its Countrywide Financial unit. It also found a top manager of Countrywide, Rebecca Mairone, liable for her role in the sale of the defective mortgages.
The government had accused the financial institutions of urging workers to churn out loans, accept fudged applications and hide ballooning defaults. Bank of America’s program became known as “The Hustle.”
Law Applies Only in U.S.
NEW YORK — A federal judge has dismissed allegations that a Chinese subsidiary of Siemens A.G. violated the Dodd-Frank Act, ruling that the law’s whistleblower protection provisions do not apply extraterritorially.
U.S. District Judge William Pauley III on October 21 threw out an action brought under the anti-retaliation provision of Dodd-Frank by Meng-Lin Liu, a former compliance officer at Siemens China who claimed he lost his job after he exposed routine bribery.
Pauley determined that the anti-retaliation provision does not protect overseas whistleblowers like Liu. Pauley is the second U.S. district judge to address the reach of Dodd-Frank’s anti-retaliation provision and conclude that it doesn’t protect whistleblowers abroad. U.S. District Judge Nancy Atlas in Houston reached the same conclusion last year 2012 in a decision concerning General Electric.
ATM Co. Pays Penalty
CLEVELAND (AP) — ATM maker Diebold Inc. has agreed to pay more than $48 million in penalties and restitution to resolve allegations of corrupt business practices overseas, the U.S. government announced on October 22.
The U.S. Securities & Exchange Commission said Diebold has agreed to pay a $25.2 million penalty to resolve an investigation into alleged bribes in China and Indonesia and falsified records in Russia.
The goal was to obtain and keep contracts to provide ATMs to state-owned and private banks in those countries, the U.S. Department of Justice said. In a related action, the SEC announced a settlement with Diebold of civil charges under the anti-bribery law. The agency said the company agreed to pay $22.9 million in restitution and to appoint an independent monitor to oversee its compliance with the law.
Mistrial in Temple Case
PHOENIX (AP) — An Arizona judge on October 24 declared a mistrial because of a jury impasse in the retrial of a man charged with killing nine people at a suburban Phoenix Buddhist temple in 1991.
The judge’s mistrial declaration means 39-year-old Johnathan Doody will face a third trial, possibly starting in late November. His second trial began in August. Doody originally was convicted 20 years ago, but won a second trial when the U.S. Circuit Court of Appeals for the Ninth Circuit ruled in 2011 that his confession was inadmissible partly because he wasn’t properly read his rights.
The jury had deliberated for about seven days when they informed the judge on October 23 that they had reached an impasse.
Billboard Fight Goes On
WASHINGTON — A federal judge on October 23 let proceed a legal challenge to the growing number of digital billboards along highways across the country.
U.S. District Judge James Boasberg found that Scenic America, a nonprofit that advocates for preserving the country’s “visual character,” met the early threshold for challenging Federal Highway Administration rules that made it easier to get approval for digital billboards.
The judge found that Scenic America had standing because the case was “fueled by concrete harm to the organization’s programs.” According to the opinion, the number of digital billboards increased from 500 in 2006 to at least 4,000 this year.
Verdict Against Ricoh
NEW YORK — A federal jury returned a verdict worth $24 million on October 23 in finding that Ricoh Co. violated a patent licensing agreement with Eastman Kodak Co. The decision brings Kodak’s total recovery in the infringement case to $75.8 million.
Kodak granted Ricoh a license in 2002 to make digital cameras using Kodak’s patented technology. Under the terms of the deal, Kodak was entitled to royalty payments from Ricoh on its camera sales. In 2011, Ricoh acquired the camera brand Pentax and refused to pay royalties on the Pentax-branded cameras, claiming that it had inherited a separate “implied license” to Kodak’s patents.
U.S. District Judge Denise Cote in August granted summary judgment to Kodak.
The only issue left in the case was whether a separate category of Ricoh’s cameras fell within the scope of the patent agreement. If Kodak prevailed on the issue, Ricoh agreed to pay an additional $22.8 million in damages.