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SMITHKLINE BEECHAM CONSUMER HEALTHCARE, L.P. v. JO

November 9, 1995

SMITHKLINE BEECHAM CONSUMER HEALTHCARE, L.P., Plaintiff, against JOHNSON & JOHNSON-MERCK CONSUMER PHARMACEUTICALS COMPANY, INC., Defendant. JOHNSON & JOHNSON-MERCK CONSUMER PHARMACEUTICALS CO., Plaintiff, -against- SMITHKLINE BEECHAM CONSUMER HEALTHCARE, L.P., Defendant.


The opinion of the court was delivered by: BAER

 Harold Baer, Jr., U.S.D.J.

 On September 13 and 14, 1995, I conducted an evidentiary hearing in this matter. For the reasons which follow, each party's motion is granted in part and denied in part.

 I. Background

 According to the parties, TAGAMET HB and PEPCID AC are part of a new generation of over-the-counter heartburn medications. Each drug works to relieve and/or prevent heartburn. Previously, the only over-the-counter medications available to counteract heartburn or acid indigestion were antacids such as TUMS, MAALOX or MYLANTA. Those three products each work by neutralizing stomach acid. In contrast, both TAGAMET HB and PEPCID AC contain H[2]-receptor antagonists that work by blocking the production of stomach acid.

 Prior to the Spring of 1995, TAGAMET HB and PEPCID AC were available only in their respective prescription forms; TAGAMET and PEPCID. TAGAMET HB is a reduced dosage form of the prescription drug TAGAMET. The active ingredient in both TAGAMET products is cimetidine. Cimetidine was introduced in 1977 as the first prescription H[2]-receptor antagonist to reach the market. In its prescription form, TAGAMET is commonly used for the treatment of gastrointestinal disorders such as ulcers. On June 19, 1995 the Food and Drug Administration ("FDA") approved TAGAMET HB for over-the-counter sale.

 Similarly, PEPCID AC is a reduced dosage form of the prescription drug PEPCID which was first introduced in 1986. Like TAGAMET, PEPCID is generally prescribed for the treatment of gastrointestinal disorders such as ulcers. Both PEPCID AC and PEPCID contain the active ingredient famotidine. Famotidine is an H[2]-receptor antagonist, similar to cimetidine, and works to suppress the production of stomach acid. The FDA approved PEPCID AC for over-the-counter sale in May of 1995, one month prior to approving TAGAMET HE.

 Both TAGAMET HB and PEPCID AC are clawing their way up the ladder for a larger share of this immense and lucrative market. With the myriad of contentions and high degree of contentiousness exhibited by this litigation, one cannot help but ponder whether the words of Hippocrates, the Greek Father of Medicine, continue as a guide today in any meaningful way:

 
I will use treatment to help the sick according to my ability and judgment but never with a view of injury or wrong doing . . . . I will keep pure and holy both my life and my art . . . .
 
Into whatever houses I enter I will go into them for the benefit of the sick, and will abstain from every voluntary act of mischief or corruption . . . .

 II. Discussion

 a. Legal Standards

 An application for preliminary injunctive relief seeks "'an extraordinary and drastic remedy which should not be routinely granted.'" Bruce v. Martin, 680 F. Supp. 616, 620 (S.D.N.Y. 1988) (quoting Medical Soc'y of the State of New York v. Toia, 560 F.2d 535, 538 (2d Cir. 1977)). The standard for reviewing a request for injunctive relief is well-settled. This Circuit recently reiterated the standard in USA Recycling, Inc. v. Town of Babylon, 66 F.3d 1272, 1995 U.S. App. LEXIS 27011, (2d Cir. 1995), stated that the movant to prevail must prove:

 
irreparable harm, and either (1) a likelihood of success on the merits of its case or (2) sufficiently serious questions going to the merits to make them a fair ground for litigation and a balance of hardships tipping decidedly in its favor.

 Id. at 1281 (citations omitted).

 Through a host of orders and decisions enjoining false advertising claims, this Court has traditionally recognized the strong public policy against the dissemination of false and misleading advertising. See generally Coca-Cola Company v. Tropicana Prods., Inc., 690 F.2d 312 (2d Cir. 1982); American Home Prods. Corp. v. Johnson & Johnson, 577 F.2d 160 (2d Cir. 1978); Johnson & Johnson v. GAC Int'l, Inc., 862 F.2d 975 (2d Cir. 1988). This interest is particularly compelling where as here, the subject is over-the-counter drugs. American Home Prods., 654 F. Supp. 568 at 590.

 The Lanham Act prohibits manufacturers from disseminating advertising which is false on its face as well as advertising which is literally true but, nevertheless, is likely to mislead and confuse consumers. The purpose of the Act is to insure that advertisements represent truthful claims by a manufacturer and to eliminate any advertising which proffers a misstatement or misrepresentation by a competitor. Section 43(a) of the Lanham Act provides in relevant part:

 
(1) Any person who, on or in connection with any goods or services, . . . uses in commerce . . . any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which -
 
* * *
 
(B) in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person's goods, services, or commercial activities,
 
shall be liable in a civil action by any person who believes that he or she is or is likely to be damaged by such act.

 15 U.S.C. § 1125(a).

 To enjoin an ad under the Lanham Act, the claim must be material and likely to influence a consumer's purchasing decision. See Skil Corp. v. Rockwell Int'l Corp., 375 F. Supp. 777, 782-83 (E.D. Ill. 1974). A court may enjoin an ad which is explicitly or literally false "'without reference to the advertisement's impact on the buying public.'" McNeil-P.C.C., Inc. v. Bristol-Myers Squibb Co., 938 F.2d 1544, 1549 (2d Cir. 1991) (citations omitted). A court may also enjoin an ad which is implicitly false, i.e. literally truthful but nonetheless misleading, only if the court can determine that the ad is confusing or deceiving, as tested by public reaction. Coca-Cola Co., 690 F.2d at 317. Although an advertisement may be literally true, a Court may deem it false by necessary implication if it is susceptible to more than one interpretation. See Cuisinarts, Inc. v. Robot-Coupe Int'l Corp., ...


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