Block on Trump's Asylum Ban Upheld by Supreme Court
Solvay, since acquired by Abbott Laboratories (and renamed AbbVie), makes a topical testosterone cream, which is protected by a patent until 2020 and has brought in $1.8 billion in revenue. Like many pharmaceutical companies, it sought to protect its product from an invasion of generic clones. It did so by filing a lawsuit.
That lawsuit settled after Solvay agreed to kick back proceeds from their sales to the now-abstaining generic producers. That may sound quite a bit like anti-competitive behavior, and if your alarms went off, you're in tune with the FTC. The problem is, these "reverse payment" arrangements are perfectly legal under existing law, as part of the right to exploit one's patent.
The FTC sued, lost, and lost again in the Eleventh Circuit. As part of their initial pleading, they attached confidential financial documents, known internally at Solvay as "Project Tulip," which they obtained after promising confidentiality to Solvay. Tulip contained such financial information as revenue, profit projections, settlement proposals for the generic producers lawsuit, and other things of that ilk that companies like to keep secret.
Project Tulip was sealed by the district court in 2010 with no opposition by the FTC. The case was eventually dismissed due to that preexisting patent law precedent, the Eleventh Circuit affirmed, and all was merry in the land until ...
The Supreme Court granted certiorari in 2012. In the past three years, the calculus of potential harm has shifted a bit.
Now, the FTC wants Project Tulip unsealed. They feel that it will help the parties, and amici, to be able to refer to the secret documents in their SCOTUS briefs. The district court agreed, which led us here.
The FTC supported it's cause by pointing out that much of the information was disclosed when Abbott Labs acquired Solvay, including sales volume. The company has also updated the product, releasing AndroGel 1.62 percent, which is different from the product discussed in Tulip.
Solvay argued that Tulip could be reverse engineered for competitive reasons (the original Tulip author testified to the contrary), the need for public access isn't great, and pointed out their reliance on the protective order in making the Tulip disclosure.
What's the law's take?
Tulip is part of the judicial record, which means there is a strong presumption in favor of disclosure. Pleadings are, by definition, part of the record. Documents attached to pleadings are to be treated as the pleadings themselves and, according to the Eleventh, there is no precedent or need for an exception for sealed attachments.
However, when it comes to the decision on whether to unseal those documents, a good cause standard does apply. The party seeking to unseal has the burden of proof.
While the District Court didn't explicitly place the burden on the FTC, it did use the proper analysis. It's language, and comparison of possible harm today versus three years ago all indicate that it was placing the burden properly. The FTC also introduced the evidence mentioned above (inability to reverse engineer, change in formula, etc.).
As for any reliance on a protective order, it doesn't make sense time-wise. Solvay handed over Tulip before the FTC filed its complaint and before there was a request for a protective order. The FTC's promises pre-complaint merely mentioned that the documents wouldn't be subject to FOIA requests, and mentioned nothing about SCOTUS briefing.
Seal lifted. District Court affirmed.
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