United States District Court for the Northern District of Illinois · 2019-01-25
15usc1: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)
Case and law context
Role: applied; posture: civil putative class action by two self-insured payors against a drug manufacturer and its exclusive distributor under §§ 1 and 2 (Counts VII, VI) plus state-law and RICO claims; Rule 12(b)(6) motions; denied as to Rockford's federal antitrust claims, granted without prejudice (leave to replead) as to Acument's for want of antitrust standing; result: mixed; claim:
Uncertainty
opinion: the IR text is capped at 60000 chars; the cut falls in the state-law part (Count VIII). The federal antitrust analysis (Counts VI-VII, @13455..47848) is complete. No appended footnotes inside the cap.
Element agreement: route: the court calls the scheme a "vertical price-fixing" conspiracy between manufacturer and exclusive distributor, so vertical-agreement; UBC is called the "hub" of the distribution chain but no rim of competitors is alleged, so not hub-and-spoke.
Element standing: polarity: the direct-shipment fact is the reason Rockford is an indirect purchaser as against Mallinckrodt; the court treats that as overcome by the co-conspirator exception.
Misfit
None recorded
B · Case × element grid
Top-level elements follow claim order in panels of up to six elements. Case rows repeat across panels. Every recorded block retains its holding and basis; multiple blocks are not merged into a case-level verdict. ✓ satisfied · ✗ not satisfied · ○ not reached · · not addressed. Muted blocks are not counted. Sub-element evidence remains on case and element pages.
Elements 1–6 of 11
Elements 7–11 of 11
| Case | Statute of limitations (4-year civil under 15 U.S.C. § 15b; 5-year criminal under 18 U.S.C. § 3282) | Law-of-the-case doctrine in consolidated/MDL antitrust proceedings | Criminal mens rea: knowing participation in the conspiracy or intent to restrain trade | Ancillary restraints doctrine (restraint subordinate and collateral to a legitimate productive integration) | Horizontal cartel / hub-and-spoke conspiracy operating through vertical or dual-distribution arrangements |
|---|---|---|---|---|---|
| City of Rockford v. Mallinckrodt ARD, Inc. — 360 F. Supp. 3d 730 (2019) · United States District Court for the Northern District of Illinois · 2019 (15usc1: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | · not addressed | · not addressed | · not addressed | · not addressed | · not addressed |
Instances and excluded annotation blocks
| Case | Element | Holding and scope | Pattern | Exact source quotations |
|---|---|---|---|---|
| City of Rockford v. Mallinckrodt ARD, Inc. — 360 F. Supp. 3d 730 (2019) · United States District Court for the Northern District of Illinois · 2019 — satisfied · pleaded (15usc1: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | Concerted action ("contract, combination ... or conspiracy") between separate economic decisionmakers | satisfied Counted merits instance applied / merits basis: pleaded; party: City of Rockford, Illinois (self-insured health-plan payor that paid ESI for Acthar; plaintiff); Mallinckrodt plc and Mallinckrodt ARD, Inc., formerly Questcor (manufacturer of Acthar; defendants); Express Scripts Holding Co. and subsidiaries ESI, CuraScript, Accredo, UBC (exclusive distributor of Acthar; defendants); theory: manufacturer and its exclusive distributor conspired to fix and inflate Acthar's price (exclusive dealing arrangement "ASAP") and to keep the only rival drug, Synacthen, off the market; subject: party=City of Rockford, Illinois (self-insured health-plan payor that paid ESI for Acthar; plaintiff); Mallinckrodt plc and Mallinckrodt ARD, Inc., formerly Questcor (manufacturer of Acthar; defendants); Express Scripts Holding Co. and subsidiaries ESI, CuraScript, Accredo, UBC (exclusive distributor of Acthar; defendants); theory=manufacturer and its exclusive distributor conspired to fix and inflate Acthar's price (exclusive dealing arrangement "ASAP") and to keep the only rival drug, Synacthen, off the market The agreement is decided inside the Illinois Brick co-conspirator discussion and then adopted for the § 1 "first prong" (@32973). Defendants argued the pleaded facts showed Mallinckrodt set the price unilaterally; the court held that did not negate the inference of agreement. | manufacturer and its sole distributor: exclusive-distribution program followed by an unresisted 1,310% price increase | A plaintiff alleging conspiracy to fix prices in violation of the Sherman Act must allege "enough factual matter (taken as true) to suggest that an agreement was made"-that is, "enough fact[s] to raise a reasonable expectation that discovery will reveal evidence of illegal agreement."Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [18054:18339] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.On August 27, 2007, Mallinckrodt embarked on a "new strategy" that sought to limit Acthar's distribution by designating Express Scripts as Mallinckrodt's sole distributor of Acthar.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [2029:2210] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.Specifically, Express Scripts agreed not to push back on Mallinckrodt's decisions to inflate Acthar's price beyond the competitive level, in contrast to when Express Scripts took the opposite approach in 2015 with respect to Turing's drug, Daraprim.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [20903:21152] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.Mallinckrodt set the average wholesale prices of Acthar used by Express Scripts for reimbursement.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [9570:9668] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.But at this stage of litigation, the court draws all reasonable inferences from the complaint in favor of plaintiffs and taking the SAC as a whole finds that plaintiffs have sufficiently alleged a conspiracy.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [21553:21761] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54. |
| City of Rockford v. Mallinckrodt ARD, Inc. — 360 F. Supp. 3d 730 (2019) · United States District Court for the Northern District of Illinois · 2019 — satisfied · pleaded (15usc1: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | Private antitrust injury and fact of damage (Clayton Act §§ 4, 16; Brunswick Corp. v. Pueblo Bowl-O-Mat) | satisfied Counted merits instance applied / merits basis: pleaded; party: City of Rockford, Illinois (self-insured health-plan payor that paid ESI for Acthar; plaintiff); Mallinckrodt plc and Mallinckrodt ARD, Inc., formerly Questcor (manufacturer of Acthar; defendants); Express Scripts Holding Co. and subsidiaries ESI, CuraScript, Accredo, UBC (exclusive distributor of Acthar; defendants); theory: manufacturer and its exclusive distributor conspired to fix and inflate Acthar's price (exclusive dealing arrangement "ASAP") and to keep the only rival drug, Synacthen, off the market; subject: party=City of Rockford, Illinois (self-insured health-plan payor that paid ESI for Acthar; plaintiff); Mallinckrodt plc and Mallinckrodt ARD, Inc., formerly Questcor (manufacturer of Acthar; defendants); Express Scripts Holding Co. and subsidiaries ESI, CuraScript, Accredo, UBC (exclusive distributor of Acthar; defendants); theory=manufacturer and its exclusive distributor conspired to fix and inflate Acthar's price (exclusive dealing arrangement "ASAP") and to keep the only rival drug, Synacthen, off the market | payor paying supracompetitive drug prices attributed to restricted distribution and a shelved rival product | The third prong requires that an antitrust plaintiff must allege that the "claimed injuries are of the type the antitrust laws were intended to prevent and reflect the anticompetitive effect of either the violation of or anticompetitive acts made possible by the violation."Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [39655:39929] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.Rockford alleges that defendants were able to charge higher prices for Acthar by restricting distribution of Acthar through the ASAP.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [40430:40563] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.Had Novartis sold the rights to Synacthen to one of the other bidders that planned to bring Acthar to market, Rockford alleges that purchasers would have had a low-cost alternative to Acthar.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [40954:41145] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.Thus, Rockford has satisfied the "antitrust injury" prong and, accordingly, the court finds that Rockford has stated a § 1 claim.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [41704:41833] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54. |
| City of Rockford v. Mallinckrodt ARD, Inc. — 360 F. Supp. 3d 730 (2019) · United States District Court for the Northern District of Illinois · 2019 — satisfied · pleaded (15usc1: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | Unreasonable restraint of trade (Standard Oil Co. v. United States) | satisfied Counted merits instance applied / merits basis: pleaded; party: City of Rockford, Illinois (self-insured health-plan payor that paid ESI for Acthar; plaintiff); Mallinckrodt plc and Mallinckrodt ARD, Inc., formerly Questcor (manufacturer of Acthar; defendants); Express Scripts Holding Co. and subsidiaries ESI, CuraScript, Accredo, UBC (exclusive distributor of Acthar; defendants); theory: manufacturer and its exclusive distributor conspired to fix and inflate Acthar's price (exclusive dealing arrangement "ASAP") and to keep the only rival drug, Synacthen, off the market; subject: party=City of Rockford, Illinois (self-insured health-plan payor that paid ESI for Acthar; plaintiff); Mallinckrodt plc and Mallinckrodt ARD, Inc., formerly Questcor (manufacturer of Acthar; defendants); Express Scripts Holding Co. and subsidiaries ESI, CuraScript, Accredo, UBC (exclusive distributor of Acthar; defendants); theory=manufacturer and its exclusive distributor conspired to fix and inflate Acthar's price (exclusive dealing arrangement "ASAP") and to keep the only rival drug, Synacthen, off the market The court declined to choose between per se and rule of reason at the pleading stage ("the court need not make this determination at this time", @35681); recorded on the parent element, no mode decided. | exclusive distribution plus acquisition and shelving of the only rival product; mode of analysis expressly deferred to after discovery | At this stage, it is sufficient for plaintiffs to plausibly allege that defendants engaged in conduct that resulted in an unreasonable restraint of trade.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [37935:38089] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.The "new strategy" reduced the number of wholesale distributors of Acthar from three to one, thereby restricting patient's access to Acthar, and employed Express Scripts' market power not to push for lower-cost alternatives.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [38221:38445] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.Upon purchasing the rights to Synacthen, Mallinckrodt chose not to bring it to market.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [7619:7705] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.As soon as defendants implemented the ASAP, Mallinckrodt increased the price of Acthar from approximately $ 1,980 to $ 27,922.80-a 1,310% increase in the span of a month, and a 69,707% increase from 2001.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [4062:4266] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.Consequently, the court finds that Rockford's assertions of anticompetitive conduct are sufficient to adequately plead the "unreasonable restraint of trade" prong of Rockford's § 1 claim.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [39447:39634] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54. |
| City of Rockford v. Mallinckrodt ARD, Inc. — 360 F. Supp. 3d 730 (2019) · United States District Court for the Northern District of Illinois · 2019 — not · pleaded (15usc1: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | Antitrust standing / efficient enforcer test (Associated General Contractors; Illinois Brick) | not Counted merits instance applied / merits basis: pleaded; party: Acument Global Technologies Inc. (self-insured payor that paid CVS Caremark for Acthar; plaintiff); Mallinckrodt plc and Mallinckrodt ARD, Inc., formerly Questcor (manufacturer of Acthar; defendants); Express Scripts Holding Co. and subsidiaries ESI, CuraScript, Accredo, UBC (exclusive distributor of Acthar; defendants); theory: manufacturer and its exclusive distributor conspired to fix and inflate Acthar's price (exclusive dealing arrangement "ASAP") and to keep the only rival drug, Synacthen, off the market; subject: party=Acument Global Technologies Inc. (self-insured payor that paid CVS Caremark for Acthar; plaintiff); Mallinckrodt plc and Mallinckrodt ARD, Inc., formerly Questcor (manufacturer of Acthar; defendants); Express Scripts Holding Co. and subsidiaries ESI, CuraScript, Accredo, UBC (exclusive distributor of Acthar; defendants); theory=manufacturer and its exclusive distributor conspired to fix and inflate Acthar's price (exclusive dealing arrangement "ASAP") and to keep the only rival drug, Synacthen, off the market Dismissed without prejudice with leave to replead; the court could not complete the AGC analysis for Acument either (@32295). | payor that paid a non-conspirator PBM (CVS Caremark), not the alleged co-conspirator distributor | First, in Illinois Brick Co. v. Illinois, 431 U.S. 720, 97 S.Ct. 2061, 52 L.Ed.2d 707 (1977), the Supreme Court held that only direct purchasers from alleged antitrust violators may bring federal antitrust actions.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [15462:15676] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.CVS charged Acument $ 894,617.75 for thirteen administrations of Acthar in a thirteen-month period between December 2015 and December 2016.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [10241:10380] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.Plaintiffs allege that CVS stepped into the place of ESI in the Acthar distribution chain, but was still coordinated by UBC.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [10116:10240] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.Otherwise, the SAC contains scant mentions of CVS and its role as part of the dealing arrangement alleged in all other respects to be exclusive.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [31830:31974] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.As currently formulated, plaintiffs do not plausibly allege that Acument was a direct purchaser from a member of the alleged conspiracy, nor does Acument plausibly allege any other theory which would furnish antitrust standing to it.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [31975:32208] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54. |
| City of Rockford v. Mallinckrodt ARD, Inc. — 360 F. Supp. 3d 730 (2019) · United States District Court for the Northern District of Illinois · 2019 — satisfied · pleaded (15usc1: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md)) | Antitrust standing / efficient enforcer test (Associated General Contractors; Illinois Brick) | satisfied Counted merits instance applied / merits basis: pleaded; party: City of Rockford, Illinois (self-insured health-plan payor that paid ESI for Acthar; plaintiff); Mallinckrodt plc and Mallinckrodt ARD, Inc., formerly Questcor (manufacturer of Acthar; defendants); Express Scripts Holding Co. and subsidiaries ESI, CuraScript, Accredo, UBC (exclusive distributor of Acthar; defendants); theory: manufacturer and its exclusive distributor conspired to fix and inflate Acthar's price (exclusive dealing arrangement "ASAP") and to keep the only rival drug, Synacthen, off the market; subject: party=City of Rockford, Illinois (self-insured health-plan payor that paid ESI for Acthar; plaintiff); Mallinckrodt plc and Mallinckrodt ARD, Inc., formerly Questcor (manufacturer of Acthar; defendants); Express Scripts Holding Co. and subsidiaries ESI, CuraScript, Accredo, UBC (exclusive distributor of Acthar; defendants); theory=manufacturer and its exclusive distributor conspired to fix and inflate Acthar's price (exclusive dealing arrangement "ASAP") and to keep the only rival drug, Synacthen, off the market Added in triage: the Illinois Brick question for Rockford is the most heavily contested federal antitrust issue in the opinion and had no block. The court also found the AGC "proper party" factors met for Rockford (@29127..30482), not recorded separately. | payor that paid the conspiring exclusive distributor sues distributor and manufacturer: co-conspirator exception to Illinois Brick | One such exception is the "co-conspirator" exception, which allows indirect purchasers to sue middlemen-conspirators if the plaintiffs can establish a conspiracy and overcharges:Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [16816:16994] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.ESI then charged Rockford $ 100,457.64 for the 30-day supply of Acthar, pursuant to the terms of the PBM Agreement.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [9784:9899] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.But here, plaintiffs do not allege that defendants' agreement in fact included a "pass-on" payment.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [27003:27102] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.Accordingly, on April 1, 2015, Mallinckrodt had Acthar shipped directly to the children of two Rockford employees.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [9669:9783] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.But at the Rule 12 stage, the court draws all reasonable inferences in favor of plaintiffs, and finds that Illinois Brick is not a bar to plaintiffs' claims.Source: docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [28349:28506] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54. |
Court interpretations recorded from this case
interpretation
standard of Rule 9(b), and accordingly, plaintiffs can allege an antitrust conspiracy by pleading circumstantial evidence of an illegal agreement.
City of Rockford v. Mallinckrodt ARD, Inc. — 360 F. Supp. 3d 730 (2019) · United States District Court for the Northern District of Illinois · 2019 (15usc1: author: Flash1 · QA: FIX (Fable, neov2/cases/TRIAGE-Flash.md))
standard of Rule 9(b), and accordingly, plaintiffs can allege an antitrust conspiracy by pleading circumstantial evidence of an illegal agreement.Source:
docroot/ir/caselaw/f_supp_3d_360.jsonl#/f-supp-3d/360/0730-01; Unicode character offsets [18441:18587] (end exclusive); SHA-256 1f8910a323ccf3d6ebebad02d768209fa54f8d2dede5be52740a926291937b54.Encompasses two distinct sub-inquiries: (1) capacity/plurality of actors (Copperweld Corp. v. Independence Tube Corp., 467 U.S. 752 (1984); American Needle), and (2) existence/proof of an actual agreement rather than unilateral conduct (United States v. Colgate & Co., 250 U.S. 300 (1919)) or mere conscious parallelism (Twombly; Matsushita). The Copperweld / American Needle "single entity" argument is this element, route capacity-to-conspire, not a separate defense (it was modelled twice until taxonomy v1.2: also as `defense x-single-entity`). Mirror image of `agreement` plurality: a parent corporation and its wholly owned subsidiary (Copperweld, 467 U.S. 752 (1984)), or a corporation and its officers/employees/agents acting on its behalf (Harvey v. Fearless Farris), are a single economic actor incapable of conspiring under § 1; however, legally single joint ventures controlled by separate potential competitors acting on separate economic interests are not immune (American Needle).