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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF PENNSYLVANIA
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`IN RE: GENERIC PHARMACEUTICALS
`PRICING ANTITRUST LITIGATION
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`THIS DOCUMENT RELATES TO:
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`ALL ACTIONS
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`MDL 2724
`16-MD-2724
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`HON. CYNTHIA M. RUFE
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`MEMORANDUM OPINION
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`Rufe, J.
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` February 9, 2021
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`On July 13, 2020, the Court adopted Special Master David Marion’s Third Report and
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`Recommendation, selecting as bellwether cases the clobetasol, clomipramine, and pravastatin
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`Direct Purchaser (“DPP”) and End-Payer (“EPP”) proposed class-action cases and the State
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`Plaintiffs’ case asserting an overarching conspiracy with Defendant Teva Pharmaceuticals USA,
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`Inc. at its center.1 Teva now moves for reconsideration of the selection of the pravastatin case
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`and the overarching Teva-centric case because, approximately six weeks after the bellwether
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`selection, a federal grand jury returned an indictment charging Teva with criminal antitrust
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`violations.
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`The indictment concerns the alleged price-fixing of 13 drugs, all of which are in the
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`States’ Teva-centric complaint, including pravastatin, which is one of the single-drug bellwether
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`cases (clobetasol and clomipramine are not part of the criminal case). Teva, joined by
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`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.
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`Case 2:16-md-02724-CMR Document 1679 Filed 02/09/21 Page 2 of 5
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`Glenmark,2 argues that the indictment, as well as pending criminal charges in a separate case
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`against Ara Aprahamian,3 fundamentally undermine the suitability of the Teva-centric and
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`pravastatin cases as effective bellwethers. According to Teva, the possibility that key witnesses
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`will assert their rights against self-incrimination will leave gaps in the factual record and in the
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`alternative, the possibility that the witnesses will testify will cause Teva severe hardship as it will
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`provide a preview of Teva’s defenses in the criminal case.
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`Plaintiffs oppose the motion for reconsideration arguing that changing the bellwether
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`cases now would set back the entire course of the MDL. Plaintiffs also argue that the cases in the
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`MDL have many overlapping Defendants and witnesses such that these issues will arise no
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`matter which cases are selected as bellwethers. According to Plaintiffs, the criminal proceedings
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`will not overwhelm the bellwether cases given the number of Defendants. Additionally, the Teva
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`indictment does not constitute new information warranting reconsideration because in the run-up
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`to the bellwether decision, other Defendants had admitted to conspiring with Teva, including on
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`pravastatin.
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`In response to Teva’s concerns that the government might use discovery in the bellwether
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`cases to obtain a strategic advantage in the criminal case, Plaintiffs argue that the Court has
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`options available such as sealing discovery and preventing the use of depositions outside of the
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`MDL. Plaintiffs also argue that selecting different bellwether cases would exclude certain key
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`Defendants from moving toward trial at this stage.
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`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.
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`2
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`Case 2:16-md-02724-CMR Document 1679 Filed 02/09/21 Page 3 of 5
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`A district court may grant a motion for reconsideration if (1) an intervening change in
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`controlling law has occurred, (2) new evidence has become available, or (3) reconsideration is
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`necessary to correct a clear error of law or prevent manifest injustice.4 Interlocutory orders
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`“remain open to trial court reconsideration, and do not constitute the law of the case.”5
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`The Court reached the bellwether decision after careful consideration and the parties have
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`moved forward in reliance on that decision for the last several months. However, the indictment
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`of the key corporate Defendant in the Teva-centric and pravastatin bellwether cases constitutes a
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`significant change in circumstances.6 Although Plaintiffs argue that only three of the 35
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`Defendants in the Teva-centric case are facing criminal charges and that many more drugs are at
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`issue than are cited in the indictment, the Amended Complaint is undeniably structured with a
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`focus on Teva, defining the alleged schemes as Teva/Mylan, Teva/Sandoz, Teva/Lupin, and so
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`forth.7 In the two bellwether cases at issue, Teva is not simply one Defendant among many.8
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`Although a corporate Defendant cannot assert a Fifth Amendment right on its own behalf,9 there
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`are individual interests at stake. Whether certain key witnesses can or will be deposed pending
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`the resolution of the criminal case implicates due process concerns.10 Given the broad scope of
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`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.
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`3
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`Case 2:16-md-02724-CMR Document 1679 Filed 02/09/21 Page 4 of 5
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`the bellwether cases, particularly the State Plaintiffs Teva-centric case, sealing documents and
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`entering protective orders may not offer a complete solution.11
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`The impact of the filing of the indictment on the MDL proceedings is magnified by the
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`ongoing COVID-19 pandemic that has utterly upended the ability of the courts to conduct
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`criminal trials. The Teva-Glenmark criminal case has been designated complex and the parties
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`have proposed scheduling orders that would lead to trial in either September 2021 or May 2022.
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`Although it is certainly possible that the criminal case could go to trial by one of those dates, the
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`Court knows firsthand the havoc the pandemic has wrought on trial schedules, and until it is
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`possible to hold a substantial number of trials safely, the number of criminal defendants awaiting
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`their day in court continues to grow. The risk of delay and of scheduling conflicts with the
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`criminal case is real.
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`Plaintiffs may be correct that the complications discussed above can be managed, but
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`seeing the rocky shoals ahead, the Court deems it prudent to adjust course now, rather than risk
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`capsizing the progress of the MDL when it is too late to turn back. As the Court previously held,
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`the purpose of a bellwether selection is to determine a course that is reasonable and fair and “will
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`promote the just and efficient conduct of” the cases constituting the MDL.12 The Court is no
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`longer convinced that the prioritization of the Teva-centric and pravastatin cases will achieve
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`that goal.13
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`The State Plaintiffs’ case centered on Heritage Pharmaceuticals, Inc., was filed before the
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`Teva-centric case and was considered as an alternative in the original bellwether selection, and
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`the Court is confident that it is an appropriate choice for a bellwether along with the
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`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.
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`4
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`Case 2:16-md-02724-CMR Document 1679 Filed 02/09/21 Page 5 of 5
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`clomipramine and clobetasol DPP and EPP proposed class actions.14 However, the Court will
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`grant the parties a (brief) opportunity to be heard before finalizing the selection.
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`An appropriate pretrial order will be entered.
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`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.
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`5
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