Case 2:16-md-02724-CMR Document 1679 Filed 02/09/21 Page 1 of 5
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF PENNSYLVANIA
`
`
`
`IN RE: GENERIC PHARMACEUTICALS
`PRICING ANTITRUST LITIGATION
`
`
`THIS DOCUMENT RELATES TO:
`
`ALL ACTIONS
`
`
`
`
`
`
`MDL 2724
`16-MD-2724
`
`HON. CYNTHIA M. RUFE
`
`
`
`
`
`MEMORANDUM OPINION
`
`Rufe, J.
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
` February 9, 2021
`
`On July 13, 2020, the Court adopted Special Master David Marion’s Third Report and
`
`Recommendation, selecting as bellwether cases the clobetasol, clomipramine, and pravastatin
`
`Direct Purchaser (“DPP”) and End-Payer (“EPP”) proposed class-action cases and the State
`
`Plaintiffs’ case asserting an overarching conspiracy with Defendant Teva Pharmaceuticals USA,
`
`Inc. at its center.1 Teva now moves for reconsideration of the selection of the pravastatin case
`
`and the overarching Teva-centric case because, approximately six weeks after the bellwether
`
`selection, a federal grand jury returned an indictment charging Teva with criminal antitrust
`
`violations.
`
`The indictment concerns the alleged price-fixing of 13 drugs, all of which are in the
`
`States’ Teva-centric complaint, including pravastatin, which is one of the single-drug bellwether
`
`cases (clobetasol and clomipramine are not part of the criminal case). Teva, joined by
`
`
`1 Teva filed an earlier motion to clarify whether bellwether selection encompassed the Indirect Reseller Plaintiff
`(“IRP”) cases for the individual drugs in addition to the DPP and EPP cases. As the Court ruled orally at a status
`conference, the IRP cases are not included in the bellwether selections; in any event, as the order selecting the
`bellwether cases will be vacated, the motion for clarification will be dismissed as moot.
`
`

`

`Case 2:16-md-02724-CMR Document 1679 Filed 02/09/21 Page 2 of 5
`
`Glenmark,2 argues that the indictment, as well as pending criminal charges in a separate case
`
`against Ara Aprahamian,3 fundamentally undermine the suitability of the Teva-centric and
`
`pravastatin cases as effective bellwethers. According to Teva, the possibility that key witnesses
`
`will assert their rights against self-incrimination will leave gaps in the factual record and in the
`
`alternative, the possibility that the witnesses will testify will cause Teva severe hardship as it will
`
`provide a preview of Teva’s defenses in the criminal case.
`
`Plaintiffs oppose the motion for reconsideration arguing that changing the bellwether
`
`cases now would set back the entire course of the MDL. Plaintiffs also argue that the cases in the
`
`MDL have many overlapping Defendants and witnesses such that these issues will arise no
`
`matter which cases are selected as bellwethers. According to Plaintiffs, the criminal proceedings
`
`will not overwhelm the bellwether cases given the number of Defendants. Additionally, the Teva
`
`indictment does not constitute new information warranting reconsideration because in the run-up
`
`to the bellwether decision, other Defendants had admitted to conspiring with Teva, including on
`
`pravastatin.
`
`In response to Teva’s concerns that the government might use discovery in the bellwether
`
`cases to obtain a strategic advantage in the criminal case, Plaintiffs argue that the Court has
`
`options available such as sealing discovery and preventing the use of depositions outside of the
`
`MDL. Plaintiffs also argue that selecting different bellwether cases would exclude certain key
`
`Defendants from moving toward trial at this stage.
`
`
`2 At the time of bellwether selection, Glenmark had sent a letter objecting to the selection of pravastatin based on the
`recent filing of a criminal information. Mem. Opp’n. on Bellwether Selection [Doc. No. 1443] at 5 n.6. That
`information is now part of the superseding indictment in the case discussed below.
`3 Ara Aprahamian, a former vice president at Taro, has been indicted in a separate case in which he is accused of
`conspiring with representatives of Teva. See United States v. Aprahamian, No. 20-cr-64 (E.D. Pa.). Aprahamian,
`who is named in the Teva-centric case, has moved to stay all civil proceedings in the MDL against him. That motion
`will be addressed separately.
`
`
`
`2
`
`

`

`Case 2:16-md-02724-CMR Document 1679 Filed 02/09/21 Page 3 of 5
`
`A district court may grant a motion for reconsideration if (1) an intervening change in
`
`controlling law has occurred, (2) new evidence has become available, or (3) reconsideration is
`
`necessary to correct a clear error of law or prevent manifest injustice.4 Interlocutory orders
`
`“remain open to trial court reconsideration, and do not constitute the law of the case.”5
`
`The Court reached the bellwether decision after careful consideration and the parties have
`
`moved forward in reliance on that decision for the last several months. However, the indictment
`
`of the key corporate Defendant in the Teva-centric and pravastatin bellwether cases constitutes a
`
`significant change in circumstances.6 Although Plaintiffs argue that only three of the 35
`
`Defendants in the Teva-centric case are facing criminal charges and that many more drugs are at
`
`issue than are cited in the indictment, the Amended Complaint is undeniably structured with a
`
`focus on Teva, defining the alleged schemes as Teva/Mylan, Teva/Sandoz, Teva/Lupin, and so
`
`forth.7 In the two bellwether cases at issue, Teva is not simply one Defendant among many.8
`
`Although a corporate Defendant cannot assert a Fifth Amendment right on its own behalf,9 there
`
`are individual interests at stake. Whether certain key witnesses can or will be deposed pending
`
`the resolution of the criminal case implicates due process concerns.10 Given the broad scope of
`
`
`4 Lazaridis v. Wehmer, 591 F.3d 666, 669 (3d Cir. 2010) (per curiam) (citing North River Ins. Co. v. CIGNA
`Reinsurance Co., 52 F.3d 1194, 1218 (3d Cir. 1995)).
`5 United States ex rel. Petratos v. Genentech Inc., 855 F.3d 481, 493 (3d Cir. 2017) (internal quotation marks and
`citations omitted).
`6 Although Plaintiffs note that the possibility of an indictment of Teva was known based on the earlier criminal cases
`and media reports, an inchoate inference carries different weight than a consummated action.
`7 See Connecticut v. Teva Pharmaceuticals USA, Inc., No. 19-2407 [Doc. No. 106] (E.D. Pa.).
`8 Plaintiffs also argue that “only” two of the six Defendants in the pravastatin cases have been indicted, but that
`constitutes one-third of the Defendants and the sole drug at issue is one of the drugs cited in the indictment.
`9 Bellis v. United States, 417 U.S. 85, 89–90 (1974).
`10 The Court will not explain this point in more detail in this Order, as it implicates matters not available on the
`public docket.
`
`
`
`3
`
`

`

`Case 2:16-md-02724-CMR Document 1679 Filed 02/09/21 Page 4 of 5
`
`the bellwether cases, particularly the State Plaintiffs Teva-centric case, sealing documents and
`
`entering protective orders may not offer a complete solution.11
`
`The impact of the filing of the indictment on the MDL proceedings is magnified by the
`
`ongoing COVID-19 pandemic that has utterly upended the ability of the courts to conduct
`
`criminal trials. The Teva-Glenmark criminal case has been designated complex and the parties
`
`have proposed scheduling orders that would lead to trial in either September 2021 or May 2022.
`
`Although it is certainly possible that the criminal case could go to trial by one of those dates, the
`
`Court knows firsthand the havoc the pandemic has wrought on trial schedules, and until it is
`
`possible to hold a substantial number of trials safely, the number of criminal defendants awaiting
`
`their day in court continues to grow. The risk of delay and of scheduling conflicts with the
`
`criminal case is real.
`
`Plaintiffs may be correct that the complications discussed above can be managed, but
`
`seeing the rocky shoals ahead, the Court deems it prudent to adjust course now, rather than risk
`
`capsizing the progress of the MDL when it is too late to turn back. As the Court previously held,
`
`the purpose of a bellwether selection is to determine a course that is reasonable and fair and “will
`
`promote the just and efficient conduct of” the cases constituting the MDL.12 The Court is no
`
`longer convinced that the prioritization of the Teva-centric and pravastatin cases will achieve
`
`that goal.13
`
`The State Plaintiffs’ case centered on Heritage Pharmaceuticals, Inc., was filed before the
`
`Teva-centric case and was considered as an alternative in the original bellwether selection, and
`
`the Court is confident that it is an appropriate choice for a bellwether along with the
`
`
`11 It should be noted that the Court does not decide that all discovery against Teva and Glenmark must be stayed.
`12 28 U.S.C. § 1407.
`13 The Court will address separately Teva’s motions for a protective order.
`
`
`
`4
`
`

`

`Case 2:16-md-02724-CMR Document 1679 Filed 02/09/21 Page 5 of 5
`
`clomipramine and clobetasol DPP and EPP proposed class actions.14 However, the Court will
`
`grant the parties a (brief) opportunity to be heard before finalizing the selection.
`
`An appropriate pretrial order will be entered.
`
`
`14 Heritage has entered into a Deferred Prosecution Agreement with the government to resolve criminal charges
`against it, United States v. Heritage Pharmaceuticals, Inc., No. 19-cr-316 [Doc. No. 14] (E.D. Pa.), and argued in
`favor of moving forward on the civil cases against it.
`
`
`
`5
`
`