Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

EURIM-PHARM GMBH v. PFIZER INC.

September 17, 1984

EURIM-PHARM GmbH, Plaintiff, against PFIZER INC., PFIZER GROUP LIMITED: PFIZER GmbH, PFIZER ITALIANA, S.p.A., PFIZER FRANCE, S.A.: LABORATOIRES PFIZER S.A.R.L., AND PFIZER CORPORATION, Defendants.


The opinion of the court was delivered by: LOWE

MEMORANDUM OPINION AND ORDER

MARY JOHNSON LOWE, D.J.

 Plaintiff Eurim-Pharm BmbH has brought this action against defendants Pfizer, Inc., Pfizer Group Limited, Pfizer GmbH, Pfizer Italiana, S.P.A., Pfizer France, S.A., Laboratoires Pfizer S.A.R.L., and Pfizer Corporation, claiming violations of section 1 of the Sherman Act, as amended (15 U.S.C. § 1). Defendants have moved pursuant to Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure to dismiss the complaint for lack of subject matter jurisdiction and failure to state a claim upon which relief can be granted. For the reasons set forth below, the motion is granted.

 Background

 Plaintiff is a limited entity organized and existing under the laws of the Federal Republic of Germany with its principal place of business in Piding/Reichenhall, Federal Republic. Plaintiff is engaged in business as a distributor, wholesaler, importer and exporter of brand-name pharmaceutical products produced by multinational pharmaceutical companies. There ae six named defendants as well as an undetermined number of unnamed co-conspirators. Of the six named defendants, Pfizer, Inc. is a Delaware corporation with its principal place of business in New York, New York. Pfizer, Inc. is engaged in interstate and foreign commerce in various businesses including the formulation, manufacture and sale of pharmaceutical products. The five remaining named defendants are all wholly-owned foreign subsidiaries of Pfizer, Inc., incorporated in and with their principal places of business throughout Europe and Central America. These foreign subsidiaries are all engaged in the business of manufacturing pharmaceutical products, solely within Europe. The unnamed co-conspirators are foreign manufacturers, distributors, jobbers and wholesalers of Pfizer pharmaceutical products, whose identities presently are not known to the plaintiff. *fn1"

 Facts

 The essence of plaintiff's claim is that defendants participated in a price-fixing and market allocation scheme to maintain their stronghold on the world market of the antibiotic Vibramycin after defendants' patent of the drug expired. Plaintiff alleges, and for purposes of this motion we must assume to be true, that under this scheme Pfizer, Inc. granted an exclusive license for producing Vibramycin to a foreign manufacturer in each major foreign market. These foreign manufacturers consisted of either wholly-owned foreign subsidiaries of Pfizer, Inc. or local foreign manufacturing companies. The foreign manufacturers agreed with Pfizer, Inc. to restrict their sales of Vibramycin agreed with Pfizer, Inc. to restrict their sales of Vibramycin to distributors, wholesalers and jobbers who in turn agreed to confine their sales to specific geographic areas assigned by Pfizer, Inc. at prices prescribed by Pfizer, Inc. and/or the foreign manufacturer. Any distributor, wholesaler or jobber who failed to honor this agreement with the foreign manufacturer would initially be warned by oral communications and would later be subject to reprisals, such as reduced allocations or delayed shipments. If these warnings and reprisals were not successful, the distributor, jobber or wholesaler would be terminated. In certain instances, Pfizer, Inc. would institute a trademark infringement action against those who did not comply with established policy.

 Plaintiff alleges that as a result of this scheme, Pfizer, Inc. has maintained a substantial share of the world market for antibiotic products, both prior to and after the expiration of defendants' patents. Further, plaintiff claims that the price of Vibramycin has been and continues to be artificially inflated due to defendants' activities.

 Plaintiff has sold Vibramycin in the Federal Republic of Germany since 1975. *fn2" In 1979 plaintiff was able to obtain Vibramycin in the United Kingdom at a price substantially lower than that available from the authorized distributors in the Federal Republic of Germany. Plaintiff repackaged the United Kingdom Vibramycin for direct sale to German retail pharmacies. During this time, Pfizer, Inc. brought a trademark infringement action against plaintiff in the German regional court, contending that plaintiff's repackaging and sale of Vibramycin violated Pfizer's rights as holder of the Vibramycin trademark. The German court granted an injunction barring plaintiff's repackaging and sale of United Kingdom Vibramycin in the Federal Republic. On appeal, the court lifted the injunction and found that the use of a national trademark to exclude competition from the sale of goods acquired in another member state of the European Economic community violated Articles 30 and 36 of the Treaty of Rome. This decision was affirmed by the Court of Justice of the European Communities.

 Defendants base their motion to dismiss the complaint upon plaintiff's failure to allege the requisite effect on United States import or domestic commerce. According to defendants, the applicability of the United States antitrust statutes to foreign business transactions is limited to "conduct" which has a "direct, substantial, and reasonably foreseeable effect" on United States domestic, import or export commerce. Sherman Act, ch. 647, § 7, 15 U.S.C. § 6a (1982). Defendants urge that the challenged activities fail to have an anticompetitive effect on United States domestic, import or export commerce because the transactions underlying this action and the effect of these transactions occurred solely within Europe, and the primary actors were European companies doing business solely within Europe.

 Plaintiff argues that defendants have participated in and continue to participate in a worldwide conspiracy which has affected United States domestic commerce by artificially inflating the price of Vibramycin in the United States.

 Discussion

 Section 7 of the Sherman Act sets forth the criteria for determining United States antitrust jurisdiction over international business transactions. 15 U.S.C. § 6a (1982). Under section 7, United States antitrust law

 shall not apply to conduct involving trade or commerce (other than import trade or import commerce) with ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.