Press Release May 06, 2020

Teva Pharmaceuticals Defeats Challenge to Antitrust Class Action Settlement in Second Circuit

Litigators from the Antitrust + Competition and Appellate teams won a victory in the Second Circuit for Teva Pharmaceuticals in an antitrust class action. The appeal involved a challenge to an order approving a class action settlement by certain insurance companies seeking to opt employee health plans they administer out of the settlement. Those insurers challenged procedures adopted by the district court specifying the steps required to exercise opt-out rights for third-party companies and the court’s finding that the would-be opt-outs had not followed those procedures. On behalf of Teva, the Goodwin team argued that the district court’s procedures were proper and that its order should be upheld. The court of appeals affirmed the district court’s order in all respects.

In its decision, the Second Circuit endorsed the procedures adopted by the district court for third-party opt outs, which, among other things, required the insurers to provide individualized proof of their authority to opt-out their customers from the class. The issue of third-party opt out rights has been a recurring issue in recent antitrust class action settlements involving the pharmaceutical industry, but the decision by the Second Circuit is the first appellate decision to address the issue and thus could serve as an important precedent in future class litigation.

Goodwin’s Brian Burgess led the appellate team and argued the case in the Second Circuit, working with Chris Holding, Robert Carroll, and Gerard Cedrone. This decision brings to an end a multi-year litigation with a large team that also included Sarah Frederick, Ken Cohen, Ashley Moore and former associates Kelly Husid, Kara Harrington, Jenny Zhang, and Christine Dieter, as well as Brian Phillips and Amy Caldwell Breitling.