In re HIV Antitrust Litigation

Filing 1941

ORDER by Judge Edward M. Chen deferring ruling on #1907 Defendants' Motion to Reconsider; and granting #1930 Defendants' Motion to Preclude. (emclc2, COURT STAFF) (Filed on 6/5/2023)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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IN RE HIV ANTITRUST LITIGATION.

Case No. 19-cv-02573-EMC

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ORDER GRANTING DEFENDANTS’
MOTION TO PRECLUDE; AND
DEFERRING DEFENDANTS’ MOTION
TO RECONSIDER

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Docket Nos. 1930, 1907

United States District Court
Northern District of California

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This order memorializes rulings made by the Court on June 5, 2023.

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Trial time. The Court set new hours for trial time: 32 total hours for Plaintiffs; 30 total

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hours for Defendants. The Court may revisit the issue as necessary but the parties should be

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prepared to litigate the case within this timeframe.

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Gilead’s motion to preclude questions re attorney-client privilege (Docket No. 1930).

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The Court granted Gilead’s motion. Plaintiffs should not ask questions designed to elicit the

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assertion of attorney-client privilege by Gilead. Nor should Plaintiffs ask questions using the

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terminology about what “nonprivileged” information Mr. Pletcher has. That being said, the jury

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should be told about the fact of Teva’s waiver and Gilead’s nonwaiver. The jury should also be

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instructed about what the privilege is, that no adverse conclusions are to be drawn based on

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invocation of privilege, and that there should be no speculation about what testimony might have

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been (consistent with the Court’s preliminary injunction on invocation of attorney-client

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privilege). The parties are to meet and confer to reach agreement on a stipulation/instruction.

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In their opposition to Gilead’s motion, Plaintiffs raised the issue of whether Mr. Pletcher

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should be able to testify about settling cases because of the cost of litigation, the forward-looking

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certainty that comes with settlement, etc. Defendants stated that they intend to elicit testimony

United States District Court
Northern District of California

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about what considerations Mr. Pletcher took into account in settling cases both before and after the

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2014 FTC settlement in question. According to Defendants, Mr. Pletcher would only provide

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testimony about these considerations as general matter; he would not testify that these

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considerations were taken into account in the FTC patent infringement suit (given that Gilead did

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not waive its attorney-client privilege). The Court bars this testimony as a Rule 403 matter. The

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probative value of the testimony is limited, especially since Defendants will already have experts

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who will provide testimony on what a rational economic actor would do under the circumstances

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when negotiating a settlement of the action – the only relevant legal question at hand. If Mr.

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Pletcher testifies on such matters, this raises the danger of Gilead waiving its attorney-client

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privilege – i.e., even if Mr. Pletcher states that these are only general considerations, a jury will

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likely infer that these considerations in fact played into Gilead’s thinking with respect to the FTC

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patent infringement suit. Should there be evidence (or reasonable inferences drawn from

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evidence) elicited by Gilead about Gilead’s subjective beliefs in settling the FTC case, it would

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raise serious fairness issues for Plaintiffs and/or could open the door to waiver of Gilead’s

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attorney-client privilege. The prejudicial and confusing nature of this testimony substantially

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outweighs it extremely limited probative value.

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To the extent Plaintiffs raised the issue of Teva’s attorney-client privilege (its invocation of

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the privilege with respect to antitrust advice), the Court deferred ruling but expressed skepticism

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with respect to Plaintiffs’ contention that Teva would waive the privilege by testifying about

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factors that Teva considered in litigating/settling the FTC patent infringement suit. Judge Beeler’s

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Discovery Order, see Docket No. 1128, provides the guide to the scope of Teva’s waiver.

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Defendants’ motion for leave to file motion to reconsider/Defendants’ motion to

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reconsider (Docket No. 1907). The Court deferred ruling on Defendants’ motion. To the extent

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Defendants raise an as-applied due process challenge, it is premature to rule on the challenge

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without knowing what the verdict is, what evidence was introduced into the record on

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reprehensibility, etc. To the extent Defendants make the off-set argument (based on the

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settlements made with the direct purchasers), the Court is skeptical. While Defendants assert a

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plausible analytical approach, there are good arguments why there should be no offset in this case;
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furthermore, if there were any allocation of the settlement sum to particular offsets where

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authorized by individual states’ laws, the calculations could be highly problematic. Nonetheless,

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the Court cannot preclude such possibility as a matter of law and further discussion must await the

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verdict and potential further evidence.

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IT IS SO ORDERED.

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Dated: June 5, 2023

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United States District Court
Northern District of California

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______________________________________
EDWARD M. CHEN
United States District Judge

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