La. AG Drops Predecessor’s Case Against Biotech Company

April 10, 2008

Louisiana’s attorney general has withdrawn a multimillion-dollar antitrust lawsuit his predecessor filed on his final day in office against drug-maker Amgen Inc.

Former Attorney General Charles Foti hired several private lawyers who had contributed to his failed re-election campaign to sue Amgen over an alleged pricing scheme.

Foti filed the suit Jan. 14, the same day James “Buddy” Caldwell was sworn in as his successor. A notice recently filed in U.S. District Court said the attorney general had decided to dismiss the case “without prejudice.”

Allen Usry, a private lawyer representing Caldwell’s office, said the attorney general is watching similar cases against Amgen and reserves the right to refile the suit.

In February, Caldwell told The Associated Press he inherited some “curious” cases Foti filed on his way out of office, but he wouldn’t elaborate.

Foti’s suit against Amgen accused the Thousand Oaks, California-based company of trying to monopolize the market for sales of drugs to oncology clinics. The suit claims Amgen engages in illegal pricing practices that penalize clinics if they fail to purchase significant volumes of Aranesp, a drug that fights anemia caused by chemotherapy.

In court papers, Amgen lawyers claimed Foti’s suit was a “mirror image” of federal cases pending in New Jersey.

Amgen spokeswoman Mary Klem said the company is pleased Caldwell has dismissed the case. Klem also denied the suit’s allegation that Amgen tries to stifle competition.

“To the contrary,” she said, “Amgen is actually the firm that brought competition into the marketplace” by introducing a new drug to compete with one already for sale.

Four lawyers from the Dugan Law Firm and the Murray Law Firm, both in New Orleans, are listed as plaintiffs attorneys in the case. The Dugan firm donated $5,000 (euro3,185) to Foti’s re-election campaign last year, while a Murray lawyer contributed $5,000 (euro3,185), records show.

In a letter dated Jan. 11, Foti authorized attorney James R. Dugan II to represent the state in the Amgen case without guarantee of payment. The letter doesn’t specify how the private lawyers could be paid for working on the case.

A bid by plaintiffs lawyers to have the case transferred to state court was scheduled to be heard Wednesday by U.S. District Judge Helen Berrigan. The hearing has been canceled now that the suit has been dismissed.

The same attorneys who represented the state in the case against Amgen also joined Foti in suing some of the nation’s largest insurance companies over their handling of policyholder claims after Hurricane Katrina.

U.S. District Court Judge Jay Zainey in New Orleans recently rejected a bid by plaintiffs attorneys to transfer the case to state court. Zainey agreed with lawyers for insurers that the case is a class action and belongs in federal court.

Caldwell’s office hasn’t said whether it will continue with the case, which accuses insurers of fixing prices and defrauding policyholders.

Foti finished third in the October 2007 primary behind Caldwell, a fellow Democrat, and Republican Royal Alexander. Foti now works at a New Orleans law firm that specializes in class-action litigation.

Was this article valuable?

Here are more articles you may enjoy.