KING DRUG COMPANY OF FLORENCE, INC vs. CEPHALON, INC., ET AL

Filing 830

ORDER THAT THE "KING DRUG DIRECT PURCHASER CLASS PLAINTIFFS' MOTION FOR CLASS CERTIFICATION OF THE DIRECT PURCHASER CLASS (DOC. NO. 662) IS GRANTED AS OUTLINED HEREIN. SIGNED BY HONORABLE MITCHELL S. GOLDBERG ON 7/27/2015. 7/27/2015 ENTERED AND COPIES MAILED, E-MAILED.(ahf)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
______________________________________________________________________________
:
KING DRUG COMPANY OF FLORENCE, INC., :
CIVIL ACTION
et al.,
:
Plaintiffs,
:
:
v.
:
No. 2:06-cv-1797
:
CEPHALON, INC., et al.,
:
Defendants.
:
_________________________________________ :__________________________________
ORDER
AND NOW, this 27th day of July, 2015, upon consideration of the “King Drug Direct
Purchaser Class Plaintiffs’ Motion for Certification of the Direct Purchaser Class” (Doc. No.
662), the response and reply thereto, as well as supplemental briefing and arguments made
during oral argument, and for the reasons stated in the accompanying memorandum opinion, it is
hereby ORDERED that the Direct Purchasers’ motion for class certification is GRANTED.
The Court makes the following determinations as required by Rule 23:
1. Pursuant to Federal Rule of Civil Procedure 23(c)(1)(B), the Class, which shall
hereinafter be denominated the “Class,” is defined as follows:
All persons or entities in the United States and its territories who
purchased Provigil in any form directly from Cephalon at any time during
the period from June 24, 2006 through August 31, 2012 (the “Class”).
Excluded from the Class are Defendants, and their officers, directors,
management, employees, subsidiaries, or affiliates, and all federal
governmental entities.
2. Pursuant to Rule 23(a)(1), the Court determines that the Class is so numerous and
geographically dispersed, and that judicial economy would be served through class
treatment, such that joinder of all members is impracticable. According to data produced
by Defendants, the Class has at least twenty-two (22) members geographically dispersed
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throughout the United States.

Additionally, the extensive history of this case and

significant discovery that has already been conducted would render joinder costly and
extremely inconvenient. These considerations are sufficient to satisfy the impracticability
of joinder requirement of Rule 23(a)(1).
3. Pursuant to Rule 23(c)(1)(B), the Court determines that the following issues relating to
claims and/or defenses present common, class-wide questions, and thus should be subject
to class treatment:
a. Whether Cephalon and the Generic Defendants entered into pay-for-delay
agreements to delay market entry of generic modafinil that violated the antitrust
“rule of reason”;
b. Whether Cephalon possessed monopoly power (and, if necessary, the definition of
the relevant market);
c. Whether Cephalon made a large payment to the Generic Defendants, as described
in Federal Trade Commission v. Actavis, Inc., 133 S. Ct. 2223 (2013);
d. Whether Defendants can prove any cognizable, non-pretextual, procompetitive
justification for the reverse payments;
e. Whether Defendants’ conduct delayed generic competition and, if so, when
generics would have entered the market but for Defendants’ conduct; and
f. Whether impact on Direct Purchasers in the form of overcharges can be proven
using proof and methodologies that are predominantly common and applicable
class-wide.
4. The Court determines that the foregoing class-wide issues relating to claims and/or
defenses are questions of law or fact common to the Class that satisfy Rule 23(a)(2).

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5. King Drug Company of Florence, Inc., J.M. Smith Corp. d/b/a Smith Drug Co., Meijer,
Inc., Meijer Distribution, Inc., Rochester Drug Co-Operative, Inc., Stephen L. LaFrance
Holdings, Inc., Burlington Drug Co., Inc., Stephen L. LaFrance Pharmacy d/b/a SAJ
Distributors, Inc., the named Plaintiffs in this lawsuit (the “Named Plaintiffs”) are
appointed as representatives of the Class for the following reasons:
a. the Named Plaintiffs allege on behalf of the Class the same manner of injury from
the same course of conduct that they complain of themselves, and the Named
Plaintiffs assert on their own behalf the same legal theories that they assert for the
Class. The Court therefore determines that the Named Plaintiffs’ claims are
typical of the claims of the proposed Class within the meaning of Rule 23(a)(3);
and
b. Pursuant to Rule 23(a)(4), the Court determines that the Named Plaintiffs will
fairly and adequately protect the interests of the Class. The Named Plaintiffs’
interests do not conflict with the interests of absent members of the Class. All of
the Class members share a common interest in proving Defendants’ alleged
anticompetitive conduct, and all Class members share a common interest in
recovering the overcharge damages sought in the Complaint. Moreover, any
Class member that wishes to opt out will be given an opportunity to do so.
Furthermore, the Named Plaintiffs are well-qualified to represent the Class in this
case, given their collective experience in prior cases, and the vigor with which
they have prosecuted this action thus far.
6. Pursuant to Rule 23(b)(3), the Court determines that common questions of law and fact
predominate over questions affecting only individual members. In light of the class-wide

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claims, issues, and defenses set forth above, the issues in this action that are subject to
generalized proof, and thus applicable to the Class as a whole, predominate over those
issues that are subject only to individualized proof. Also pursuant to Rule 23(b)(3), the
Court determines that a class action is superior to other available methods for the fair and
efficient adjudication of this action. The Court believes it is desirable, for purposes of
judicial and litigation efficiency, to concentrate the claims of the Class in a single action.
The Court also believes that there are few manageability problems presented by a case
such as this.
7. This Court previously appointed Bruce E. Gerstein and Joseph Opper of Garwin Gerstein
& Fisher, LLP as Lead Counsel for the Class; Daniel Berger, David F. Sorenson, and
Daniel C. Simons of Berger & Montague, P.C. as Liaison Counsel and as a member of
the Executive Committee for the Class; and an Executive Committee for the Class
comprised of: Stuart E. Des Roches, Esq. and Andrew Kelly, Esq. of Odom & Des
Roches, L.L.P.; David P. Smith (now of Smith Segura & Raphael, LLP); Linda P.
Nussbaum, Esq. (now of Giant & Eisenhofer, P.A.); and Dianne M. Nast, Esq. and Erin
C. Burns, Esq. (now of NastLaw LLC). (See Doc. No. 196.) The Court finds that
counsel for the Class have prosecuted this litigation effectively to date, and, having
considered the factors provided in Rule 23(g)(1)(A), hereby confirms the respective
appointments as counsel for the Class pursuant to Federal Rule of Civil Procedure
23(c)(1)(B) and 23(g). Lead Counsel are directed to ensure that any remaining work in
this litigation that is performed by any counsel listed on the complaint is performed
efficiently and without duplication of effort.

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8. The parties should be prepared to discuss the notice process at the status conference
scheduled to be held on Monday, August 10, 2015 at 10:00 a.m. (See Doc. No. 826.)

BY THE COURT:
/s/ Mitchell S. Goldberg
______________________________
Mitchell S. Goldberg, J.

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