Title: Barbara A. Meyers v. Bayer AG

State: wisconsin

Issuer: Wisconsin Supreme Court

Document:

2007 WI 99 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2003AP2840 
 
 
COMPLETE TITLE: 
 
 
Barbara A. Meyers, Lynn Stucker, Loyal Berg and 
Eugene Browning individually and on behalf of 
all others similarly situated, 
          Plaintiffs-Appellants, 
     v. 
Bayer AG, Bayer Corporation, Barr Laboratories, 
Inc., Rugby Group, Inc., Watson Pharmaceuticals, 
Inc. and Hoeschst Marion Roussel, Inc., 
          Defendants-Respondents-Petitioners. 
 
 
 
 
REVIEW OF A DECISION OF THE COURT OF APPEALS 
2006 WI App 102 
Reported at: 293 Wis. 2d 770, 718 N.W.2d 251 
(Ct. App. 2006—Published) 
 
 
OPINION FILED: 
July 13, 2007   
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
December 12, 2006   
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Milwaukee   
 
JUDGE: 
Michael Guolee  
 
 
 
JUSTICES: 
 
 
CONCURRED: 
        
 
DISSENTED: 
PROSSER, J., dissents (opinion filed). 
 
ROGGENSACK, J., dissents (opinion filed). 
WILCOX and PROSSER, JJ., join the dissent.   
 
NOT PARTICIPATING:         
 
 
 
ATTORNEYS: 
 
For 
the 
defendants-respondents-petitioners 
there 
were 
briefs by Phillip A. Proger, Kevin D. McDonald, Lawrence D. 
Rosenberg, and Jones Day, Washington, D.C.; Gerardo H. Gonzalez, 
Richard J. Krill, and Gonzalez, Saggio & Harlan, LLP, Milwaukee; 
Fred H. Bartlit, Jr., Peter B. Bensinger, Jr., Michael J. 
Valaik, Paul J. Skiermont, and Bartlit Beck Herman Palenchar & 
Scott LLP, Chicago, IL; William J. Mulligan, Kathy L. Nusslock, 
and Davis & Kuelthau, S.C., Milwaukee; Thomas D. Yannucci, P.C., 
Karen N. Walker, Edwin John U, and Kirkland & Ellis LLP, 
Washington, D.C.; Stephen P. Hurley, Kristine A. Long, Andrew W. 
Erlandson, and Hurley, Burish & Milliken, S.C., Madison; David 
 
 
2 
E. Everson, Heather S. Woodson, Victoria L. Smith, and Stinson 
Morrison Hecker LLP, Kansas City, MO, and oral argument by Fred 
H. Bartlit, Jr. 
 
For the plaintiffs-appellants there was a brief by John C. 
Cabaniss, Thomas Armstrong, and von Briesen & Roper, s.c., 
Milwaukee, and oral argument by Thomas Armstrong, Jr. 
 
An amicus curiae brief was filed by Stephen E. Meili and 
Consumer Law Litigation Clinic, Madison; Peter C. Carstensen, 
David Dudley, and University of Wisconsin Law School, Madison; 
on behalf of the University of Wisconsin Law School Consumer Law 
Litigation 
Clinic, 
Professor 
Peter 
C 
Carstensen 
of 
the 
University of Wisconsin Law School, and David Dudley of the 
University of Wisconsin Law School. 
 
An amicus curiae brief was filed by Eric J. Wilson and 
Gwendolyn J. Cooley, assistant attorneys general, with whom on 
the brief was Peggy A. Lautenschlager, attorney general, on 
behalf of the state of Wisconsin, and there was oral argument by 
Eric J. Wilson. 
 
An amicus curiae brief was filed by Paul E. Benson, Grant 
C. Killoran, and Michael Best & Friedrich, LLP, Milwaukee, on 
behalf of the Milwaukee Metropolitan Chamber of Commerce and the 
Wisconsin Manufacturers and Commerce, Inc. 
 
 
2007 WI 99
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.  2003AP2840  
(L.C. No. 
2000CV9347) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
Barbara A. Meyers, Lynn Stucker, Loyal Berg and 
Eugene Browning, individually and on behalf of 
all others similarly situated, 
 
          Plaintiffs-Appellants, 
 
     v. 
 
Bayer AG, Bayer Corporation, Barr Laboratories, 
Inc., Rugby Group, Inc., Watson 
Pharmaceuticals, Inc. and Hoeschst Marion 
Roussel, Inc., 
 
          Defendants-Respondents-Petitioners. 
 
FILED 
 
JUL 13, 2007 
 
David R. Schanker 
Clerk of Supreme Court 
 
 
 
 
 
REVIEW of a decision of the Court of Appeals.  Affirmed and 
remanded for further proceedings.   
 
¶1 
LOUIS B. BUTLER, JR., J.  The defendants, Bayer AG, et 
al. (collectively "Bayer"), seek review of a published court of 
appeals' decision1 reversing a circuit court order that dismissed 
all claims brought under Wisconsin's Antitrust Act, Chapter 133 
of the Wisconsin Statutes, by Barbara Meyers, Lynn Stucker, 
                                                 
1 Meyers v. Bayer AG, 2006 WI App 102, 293 Wis. 2d 770, 718 
N.W.2d 251. 
No. 
2003AP2840   
 
2 
 
Loyal 
Berg, 
and 
Eugene 
Browning 
(collectively 
"Meyers"), 
representing a putative class of Wisconsin residents who 
purchased the antibiotic ciprofloxacin hydrochloride from Bayer 
under the brand name Cipro.  Meyers' complaint2 alleges that 
Wisconsin consumers paid inflated prices for Cipro as a result 
of an unlawful agreement between Bayer and three manufacturers 
of generic drugs, Barr Laboratories, Inc. ("Barr"), Hoechst 
Marion Roussel, Inc. ("HMR") and The Rugby Group ("Rugby"), 
which precluded Barr, HMR and Rugby from selling or marketing 
generic ciprofloxacin hydrochloride to compete with Cipro.  
¶2 
The 
circuit court, Honorable Michael D. Guolee, 
dismissed 
Meyers' 
claims 
against 
Bayer, 
concluding 
that 
Wisconsin's 
Antitrust 
Act, 
Wis. Stat. § 133.03 
(2005-06),3 
applied only to intrastate commerce.  Meyers appealed, and the 
court of appeals held the case in abeyance pending our decision 
in Olstad v. Microsoft Corp., 2005 WI 121, 284 Wis. 2d 224, 700 
N.W.2d 
139. 
 
Subsequently, 
we 
concluded 
in 
Olstad 
that 
Wisconsin's Antitrust Act applies to cases involving interstate 
conduct if  
(1) the actionable conduct, such as the formation of a 
combination or conspiracy, occurred within this state, 
even if its effects are felt primarily outside of 
Wisconsin; 
or 
(2) 
the 
conduct 
complained 
of 
"substantially affects" the people of Wisconsin and 
                                                 
2 Except where otherwise noted, the complaint we refer to 
throughout this opinion is the second amended complaint filed by 
the plaintiffs in this action. 
3 All references to the Wisconsin Statutes are to the 2005-
06 version unless otherwise indicated. 
No. 
2003AP2840   
 
3 
 
has impacts in this state, even if the illegal 
activity 
resulting 
in 
those 
impacts 
occurred 
predominantly or exclusively outside this state. 
Olstad, 284 Wis. 2d 224, ¶1.  Applying Olstad, the court of 
appeals reversed the circuit court on grounds that the Wisconsin 
Antitrust Act reaches interstate commerce, and Meyers' complaint 
alleged facts of illegal conduct that, if true, "substantially 
affected" the people of Wisconsin and had impacts in this state.  
Meyers v. Bayer AG, 2006 WI App 102, ¶¶1, 10-11, 293 Wis. 2d 
770, 718 N.W.2d 251.  
¶3 
We follow our precedent set forth in Olstad for 
determining when Chapter 133 reaches interstate commerce:  A 
plaintiff filing an action under Wisconsin's Antitrust Act must 
allege price fixing as a result of the formation of a 
combination or conspiracy that "'substantially affects' the 
people of Wisconsin and has impacts in this state" when the 
challenged conduct occurs predominately or exclusively outside 
this state.  Olstad, 284 Wis. 2d 224, ¶85.  We conclude that 
additional limitations Bayer and amici Milwaukee Metropolitan 
Chamber of Commerce and Wisconsin Manufacturers and Commerce 
seek to read into the "substantially affects" standard are 
unsupported by our precedents and are contrary to the policy 
choices of the legislature.   
¶4 
Meyers' 35-page, 106-paragraph complaint alleges a 
broad 
price-fixing 
scheme 
affecting 
"at 
a 
minimum, 
thousands . . . in Wisconsin" who purchased the best-selling 
antibiotic Cipro "at any time since January 6, 1995."  We 
conclude Meyers' complaint alleges illegal conduct that, if 
No. 
2003AP2840   
 
4 
 
true, substantially affected the people of Wisconsin and had 
impacts in this state.4  We therefore affirm the court of 
appeals' decision reversing the circuit court's order dismissing 
Meyers' claims, and remand for further proceedings consistent 
with this opinion.  
I 
¶5 
This review of a decision of the court of appeals 
arises on a motion to dismiss for failure to state a claim.  For 
purposes of this review, we accept as true the facts alleged in 
Meyers' complaint.  Tietsworth v. Harley-Davidson, Inc., 2004 WI 
32, ¶5, 270 Wis. 2d 146, 677 N.W.2d 233.  The facts as set forth 
below are taken from Meyers' complaint except where otherwise 
noted. 
¶6 
Bayer filed U.S. Patent No. 4,670,444 ("'444 patent") 
on May 29, 1984, a compound patent for the drug ciprofloxacin 
hydrochloride.  In October 1987, a subsidiary of Bayer obtained 
                                                 
4 At oral argument, the issue arose of whether the agreement 
between 
Bayer 
and 
the 
generic 
manufacturers 
constituted 
actionable conduct under Chapter 133.  We note that a federal 
district court dismissed an action under the Sherman Antitrust 
Act against Bayer on grounds that the Agreement between Bayer 
and the generic manufacturers did not violate federal antitrust 
law. 
 
See 
In 
re 
Ciproflaxacin 
Hydrochloride 
Antitrust 
Litigation, 363 F. Supp. 2d 514 (E.D.N.Y. 2005).  In a complex 
opinion discussing a number of different issues, the federal 
district court addressed whether the consumer plaintiffs could 
attack the validity of the Cipro patent post hoc, and the effect 
of the possible invalidity of the patent on the legality of the 
Agreements, among other questions.  Because these issues have 
not been briefed by the parties, have not been developed in the 
record in this motion to dismiss, and are not properly before 
this court, we do not address them further.  These matters may 
be addressed by the circuit court on remand. 
No. 
2003AP2840   
 
5 
 
approval from the Food and Drug Administration ("FDA") to market 
ciprofloxacin hydrochloride.  The drug was marketed under the 
name Cipro, a broad spectrum antibiotic approved to treat 
sinusitis, lower respiratory infections, and fifteen other 
ailments.  Cipro quickly became one of the most prescribed drugs 
of its kind.5  Meyers' complaint states that within one year of 
its introduction, Cipro was adopted in the formulary of every 
hospital in the United States.  
¶7 
In October 1991 Barr filed an Abbreviated New Drug 
Application ("application") with the FDA, pursuant to certain 
provisions of 21 U.S.C. § 355, a/k/a the Hatch-Waxman Act, 
requesting approval to market and sell generic ciprofloxacin 
hydrochloride ("generic Cipro").  Pursuant to the Hatch-Waxman 
Act, Barr notified Bayer of its application, and asserted that 
Bayer's '444 patent was invalid and unenforceable.  In response, 
Bayer filed a patent infringement lawsuit against Barr on 
January 16, 1992, challenging Barr's application to market and 
sell generic Cipro.  As a result of the infringement lawsuit, 
FDA approval of Barr's application was automatically postponed 
by operation of statute, 21 U.S.C. § 355(j)(5)(B)(iii) (1991), 
pending resolution of the patent infringement lawsuit. 
¶8 
On January 6, 1995, with the patent case as yet 
unresolved, 
the 
FDA 
gave 
tentative 
approval 
to 
Barr's 
                                                 
5 Meyers' complaint indicates that, as of January 2002, 
Cipro was the best-selling antibiotic in the world, a position 
it had maintained for eight consecutive years.  Meyers cites a 
March 2000 Bayer press release indicating that in 1999 Cipro 
posted $1 billion in sales in the United States. 
No. 
2003AP2840   
 
6 
 
application for generic Cipro.  Meyers' complaint states that, 
following the FDA's action, a Barr official reportedly stated 
that Barr would bring to market its generic Cipro "immediately" 
if Barr prevailed in the patent infringement suit.  
¶9 
On March 29, 1996, Barr entered into an agreement with 
Rugby, a rival generic drug manufacturer, in which Barr agreed 
to share equally with Rugby any rights and profits from the 
eventual marketing and distribution of generic Cipro in exchange 
for Rugby's assistance in funding the patent litigation with 
Bayer.  
¶10 Bayer moved for summary judgment in the patent suit 
with Barr and Rugby in January 1996.  On June 5, 1996, the court 
presiding over the patent litigation denied Bayer's motion for 
summary judgment, and denied a motion for reconsideration on 
September 5, 1996.   
¶11 On January 8, 1997, Bayer, Barr, HMR, and Rugby 
entered into four agreements (collectively, the "Agreement") 
which allocated the entire United States market for Cipro for at 
least six years, and required Bayer to make large monetary 
payments to Barr and HMR.6  According to the complaint, Bayer 
made an initial payment to Barr and HMR of $49.1 million.  The 
complaint asserts that the Agreement granted Bayer an unlawful 
monopoly in the market for Cipro and generic Cipro.  As a part 
                                                 
6 The complaint states that Rugby was a subsidiary of HMR 
until February 1998, at which time Rugby was acquired by Watson.  
The complaint states that Rugby retained the exclusive right to 
distribute generic Cipro following the sale of Rugby to Watson 
Pharmaceuticals, Inc. ("Watson").  
No. 
2003AP2840   
 
7 
 
of the Agreement, Bayer and Barr agreed to resolve the patent 
litigation by entering into a consent judgment that acknowledged 
the validity and enforceability of the '444 patent.  Bayer 
states it is undisputed that the discussions relating to the 
Agreement occurred in New York and Germany.   
¶12 The Agreement further provided that Bayer could either 
(a) license and supply Bayer-manufactured Cipro to Barr and HMR 
for resale under a generic label; or (b) pay quarterly amounts 
to Barr from 1998 through at least 2003.7  The former of these 
options established the price Barr and HMR would pay to Bayer 
for Cipro, and required Barr and HMR to share its profits with 
Bayer.  
The 
Agreement also required Barr to amend its 
application to the FDA, ending its challenge to the validity of 
the '444 patent.  The Agreement required that the parties not 
disclose the terms of the Agreement.  The consent judgment 
ending the patent litigation in federal court contained no 
information about the terms of the Agreement and made no mention 
of any payments from Bayer to Barr.   
¶13 Meyers' complaint asserts that, as a result of the 
Agreement, Bayer maintained its monopoly of the United States 
market for Cipro and generic equivalents of Cipro.  Published 
reports cited in the complaint show that from January 1997 to 
                                                 
7 Meyers' brief states that Bayer has chosen to make 
quarterly payments to Barr and HMR.  It states that, including 
the $49.1 million initial payment, Bayer agreed to pay Barr and 
HMR through December 2003 a total of $398 million not to compete 
in the United States with Bayer in the market for Cipro and 
generic equivalents to Cipro.   
No. 
2003AP2840   
 
8 
 
December 1998, Bayer increased the price of Cipro by 16.7%, one 
of the largest increases for any prescription drug in the United 
States.  Bayer's internal sales documents show that its revenues 
and profits increased substantially after the execution of the 
Agreement, according to the complaint.  From 1998 to 1999, 
Bayer's 
United 
States 
revenues 
from 
Cipro 
went 
up 
from 
$834,620,400 to $1,042,473,100, an increase of 25%, while its 
net profits jumped from $756,265,800 to $921,631,900, an 
increase of 22%.  
¶14 The complaint asserts that were it not for the conduct 
of the defendants, generic manufacturers, including Barr, would 
have begun marketing and selling generic Cipro in the United 
States no later than January 1995.  The complaint asserts that, 
"[a]s a result of the illegal conduct of Defendants, Plaintiffs 
and members of the Class were compelled to pay, and did pay, 
supracompetitive prices for Cipro which were substantially 
higher than the prices that Plaintiffs and members of the Class 
would have paid absent the unlawful agreements and conspiracy 
alleged herein."   
¶15 In November 2000, Meyers,8 both individually and on 
behalf of all others similarly situated, filed suit against 
Bayer, Barr, Rugby, Watson and HMR in Milwaukee County Circuit 
Court.  The complaint states that the named plaintiffs and 
members of the putative class are Wisconsin residents who 
                                                 
8 Plaintiffs Stucker, Berg and Browning were later added to 
the complaint by amendment. 
No. 
2003AP2840   
 
9 
 
purchased Cipro indirectly from Bayer at any time since January 
6, 1995.  The complaint alleges violations of the Wisconsin 
Unfair Competition statute, Wis. Stat. § 100.20(1), and the 
Wisconsin Antitrust Act, Wis. Stat. § 133.03(1).   
¶16 The case was removed to the United States District 
Court for the Eastern District of Wisconsin and subsequently 
transferred to a New York federal district court.  On October 1, 
2001, the case was remanded back to the state court where it was 
originally filed.  See In re Ciproflaxacin Hydrochloride 
Antitrust Litig., 166 F. Supp. 2d 740, 742-43 (E.D.N.Y. 2001).   
¶17 On remand of the matter back to the Milwaukee Circuit 
Court, Bayer moved to dismiss Meyers' complaint.  In an order 
dated September 19, 2003, the Milwaukee County Circuit Court, 
Honorable Michael D. Guolee, granted Bayer's motion, concluding 
that the complaint failed to state a claim on which relief could 
be granted.  The circuit court's decision relied on Conley 
Publishing Group, Ltd. v. Journal Communications, Inc., 2003 WI 
119, ¶16, 265 Wis. 2d 128, 665 N.W.2d 879, which stated that 
"the 
scope 
of 
Chapter 
133 
is 
limited 
to 
intrastate 
transactions."  
¶18 Meyers appealed from the order of dismissal.  The 
court of appeals stayed the appeal pending the outcome of the 
Olstad case, which was on certification to this court to resolve 
an apparent conflict between a line of cases including Conley 
Publishing, which held that Chapter 133 did not reach interstate 
commerce, and a divergent line of cases, including State v. 
Allied Chemical and Dye Corp., 9 Wis. 2d 290, 295, 101 N.W.2d 
No. 
2003AP2840   
 
10 
 
133 (1960), which suggested that Chapter 133 provided a remedy 
in at least some cases involving interstate conduct.  In a 5-0 
decision, with Chief Justice Abrahamson and Justice Bradley not 
participating, we wrote that Chapter 133 "applies to interstate 
commerce, at least in some circumstances."  Olstad, 284 Wis. 2d 
224, ¶74.  We explained that Wisconsin's Antitrust Act provides 
a remedy whenever:  (1) the actionable conduct occurs within the 
state; or (2) the actionable conduct "substantially affects" the 
people of Wisconsin and has impacts in the state, even if the 
conduct 
resulting 
in 
these 
impacts 
occurred 
outside 
of 
Wisconsin.  Id., ¶85.   
¶19 In view of Olstad, the court of appeals reversed the 
circuit 
court, 
concluding 
that 
the 
circuit 
court's 
interpretation of the scope of the Wisconsin Antitrust Act was 
erroneous.  Meyers, 293 Wis. 2d 770, ¶9.  The court of appeals 
noted that while Olstad did not define "substantially affects," 
this court stated in Allied Chemical, 9 Wis. 2d at 295, that 
"[t]he public interest and welfare of the people of Wisconsin 
are substantially affected if prices of a product are fixed or 
supplies thereof are restricted as the result of an illegal 
combination or conspiracy."  The court of appeals examined 
Meyers' complaint and concluded that it set forth the necessary 
facts and allegations to withstand a motion to dismiss.  Meyers, 
293 Wis. 2d 770, ¶13. 
¶20 Bayer filed a petition seeking review of the court of 
appeals' decision, stating that the issue presented for review 
was whether the allegations of the complaint satisfied the 
No. 
2003AP2840   
 
11 
 
"substantially affects" test articulated in Olstad.  We granted 
Bayer's petition to address this particular issue, and we 
affirm.   
II 
¶21 The matter of whether a complaint states a claim upon 
which relief can be granted is a question of law subject to our 
independent review.  Beloit Liquidating Trust v. Grade, 2004 WI 
39, ¶17, 270 Wis. 2d 356, 677 N.W.2d 298 (citation omitted).  "A 
motion to dismiss a complaint for failure to state a claim upon 
which relief can be granted tests the legal sufficiency of the 
complaint."  Id.  For the limited purposes of assessing the 
complaint's legal sufficiency, we accept as true all facts as 
set forth in the complaint, and reasonable inferences that may 
be drawn from such facts.  Id.  "[A] complaint in a civil action 
should not be dismissed as legally insufficient unless it is 
clear that there are no circumstances under which the plaintiff 
can recover."  Lewis v. Sullivan, 188 Wis. 2d 157, 164, 524 
N.W.2d 630 (1994). 
 
¶22 Whether the complaint is legally sufficient in this 
case depends upon application of the Wisconsin Antitrust Act, 
Chapter 133, and the cases construing it, to the facts as pled.  
Interpretation and application of statutes and case law to a set 
of facts are matters of law that we decide de novo.  Welin v. 
American Family Mut. Ins. Co., 2006 WI 81, ¶16, 292 Wis.2d 73, 
717 N.W.2d 690. 
 
¶23 Statutory interpretation begins with the language of 
the statute.  We apply the language of the statute as written, 
No. 
2003AP2840   
 
12 
 
giving the words their commonly accepted meanings.  Statutory 
context is relevant to the plain meaning of a statute.  Previous 
cases 
construing 
a 
statute 
also 
become 
a 
part 
of 
our 
understanding of a statute's plain meaning.  See Olstad, 284 
Wis. 2d 224, ¶21 (quoting Zimmerman v. Wisconsin Elec. Power 
Co., 38 Wis. 2d 626, 633-34, 157 N.W.2d 648 (1968) ("'It has 
often been said that once a construction has been given to a 
statute, the construction becomes a part of the statute.'")).   
III 
 
¶24 Two years ago, we concluded in Olstad, 284 Wis. 2d 
224, ¶1, that the Wisconsin Antitrust Act, Wis. Stat. § 133.03,  
may 
reach 
interstate commerce if (1) actionable 
conduct, such as the formation of a combination or 
conspiracy, occurred within this state, even if its 
effects are felt primarily outside Wisconsin; or (2) 
the conduct complained of "substantially affects" the 
people of Wisconsin and has impacts in this state, 
even if the illegal activity resulting in those 
impacts occurred predominantly or exclusively outside 
this state.   
A civil plaintiff filing an action under the act must allege 
either that actionable conduct occurred within the state, or 
that the conduct complained of "substantially affects" the 
people of Wisconsin and has impacts in this state.  Id., ¶85.  
Because the issue in Olstad arose on a certified question, we 
did not apply the "substantially affects" test to the facts of 
the case, a class action against the software manufacturer 
Microsoft alleging monopolistic practices.  See id.  We 
explicitly 
declined 
to 
elaborate 
on 
the 
meaning 
of 
"substantially 
affects," 
except 
to 
state 
the 
following:  
No. 
2003AP2840   
 
13 
 
"Operating with lesser standards would jeopardize the action, 
undermine the validity of our antitrust statute, and create the 
spectacle of Lilliputian harassment in Wisconsin courts."  Id.  
 
¶25 Bayer contends that the cases upon which Olstad relied 
establish that the "substantially affects" test requires that 
plaintiffs 
allege 
specific 
and 
particularized 
effects 
on 
Wisconsin consumers, not merely generalized allegations of 
nationwide effects.  It further asserts that plaintiffs must 
allege that the impacts on this state are more than that 
indirect purchasers in Wisconsin may have paid higher prices 
because of the challenged conduct.  Meyers contends that 
requiring allegations of specific and particularized effects 
would amount to a heightened pleading standard for claims 
brought under the Wisconsin Antitrust Act, and be contrary to 
the purposes of the statute.  To consider these arguments, we 
examine the language of the Wisconsin Antitrust Act and those 
cases interpreting it.   
A 
 
¶26 Wisconsin Stat. § 133.03 provides as follows, in 
relevant part: 
 
(1) Every contract, combination in the form of trust 
or otherwise, or conspiracy, in restraint of trade or 
commerce is illegal.  Every person who makes any 
contract or engages in any combination or conspiracy 
in restraint of trade or commerce is guilty of a Class 
H felony, except that, notwithstanding the maximum 
fine specified in s. 939.50(3)(h), the person may be 
fined not more than $100,000 if a corporation, or, if 
any other person, may be fined not more than $50,000. 
No. 
2003AP2840   
 
14 
 
(2) Every person who monopolizes, or attempts to 
monopolize, or combines or conspires with any other 
person or persons to monopolize any part of trade or 
commerce is guilty of a Class H felony, except that, 
notwithstanding the maximum fine specified in s. 
939.50(3)(h), the person may be fined not more than 
$100,000 if a corporation, or, if any other person, 
may be fined not more than $50,000. 
Chapter 133 contains a statement of legislative intent, which 
provides as follows: 
The intent of this chapter is to safeguard the public 
against the creation or perpetuation of monopolies and 
to foster and encourage competition by prohibiting 
unfair and discriminatory business practices which 
destroy or hamper competition.  It is the intent of 
the legislature that this chapter be interpreted in a 
manner which gives the most liberal construction to 
achieve the aim of competition.  It is the intent of 
the legislature to make competition the fundamental 
economic policy of this state and, to that end, state 
regulatory agencies shall regard the public interest 
as requiring the preservation and promotion of the 
maximum level of competition in any regulated industry 
consistent 
with the other public interest goals 
established by the legislature. 
Wis. Stat. § 133.01.  Wisconsin Stat. § 133.18 provides treble 
damages to "any person injured, directly or indirectly."  As we 
noted in Olstad, 284 Wis. 2d 224, ¶61, language providing 
recovery to those harmed indirectly was adopted in response to 
the United States Supreme Court's decision in Illinois Brick Co. 
v. State of Illinois, 431 U.S. 720 (1977), which limited 
recovery 
under 
the 
federal 
antitrust 
statute 
to 
direct 
purchasers.   
¶27 We thoroughly examined the language of the Wisconsin 
Antitrust Act, its legislative history and historical context in 
No. 
2003AP2840   
 
15 
 
Olstad to determine whether the Wisconsin Antitrust Act applies 
to conduct that reaches interstate commerce.  There, we noted 
that the Wisconsin Antitrust Act was adopted in 1893, three 
years after passage of the Sherman Antitrust Act.  Olstad, 284 
Wis. 2d 224, ¶41.  At that time, there was little doubt that 
state antitrust law was limited in scope to conduct impacting 
intrastate commerce; the Supreme Court saw only a narrow role 
for state government in commercial regulation.  Id., ¶30.  
Courts then treated state and federal governments as "'separate 
and distinct sovereignties, acting separately and independently 
of each other, within their respective spheres.'"  Id., ¶33 
(quoting The Collector v. Day, 78 U.S. 113, 124 (1870)).   
¶28 Our 
early 
cases 
interpreting 
the 
reach 
of 
the 
Wisconsin Antitrust Act were consistent with this narrow view of 
state regulatory authority, holding that the statute applied 
only to intrastate commerce.  See, e.g., State v. Lewis & 
Leidersdorf Co., 201 Wis. 543, 549, 230 N.W. 692 (1930); Pulp 
Wood v. Green Bay Paper & Fiber Co., 157 Wis. 604, 625, 147 N.W. 
1058 (1914).  While the Supreme Court later adopted a much less 
rigid view of the role of state government in regulation, some 
of this court's decisions continued to adhere to the view that 
the Wisconsin Antitrust Act was limited in scope to intrastate 
commerce.  See, e.g., Conley Publishing, 265 Wis. 2d 128; Grams 
v. Boss, 97 Wis. 2d 332, 346, 294 N.W.2d 473 (1980).  However, 
as we discussed in Olstad, 284 Wis. 2d 224, ¶¶24-27, other cases 
held that the Wisconsin Antitrust Act reached interstate 
commerce in some circumstances.  See State v. Milwaukee Braves, 
No. 
2003AP2840   
 
16 
 
31 Wis. 2d 699, 144 N.W.2d 1 (1966); Allied Chemical, 9 Wis. 2d 
290.  Based on the apparent conflict between these lines of 
cases, we concluded in Olstad, 284 Wis. 2d 224, ¶28, that 
Chapter 133 had been interpreted inconsistently, and, as a 
result, the statute was ambiguous.9  We therefore examined the 
legislative history of the Wisconsin Antitrust Act, and in 
particular a 1980 overhaul of the statute.  See id., ¶¶55-73. 
¶29 The 1980 revision, Olstad explained, included language 
that 
permitted 
indirect 
purchasers 
harmed 
by 
antitrust 
violations to recover under the Wisconsin Antitrust Act.  Id., 
¶61-63 (discussing language now contained in Wis. Stat. § 133.18 
providing that "any person injured, directly or indirectly, by 
reason of anything prohibited by this chapter may sue").  A 
letter from Attorney General Bronson La Follette to the bill's 
Assembly author, Representative Marjorie Miller, indicated that 
this change  
would reverse the effect of the U.S. Supreme Court's 
ruling in the Illinois Brick case on Wisconsin law.  
The Court, in that case, ruled that only direct 
purchasers may recover damages for illegally-priced 
goods.  Thus, indirect purchasers——such as state and 
                                                 
9 The conclusion in Olstad v. Microsoft Corp., 2005 WI 121, 
¶28, 284 Wis. 2d 224, 700 N.W.2d 139, that the statute was 
ambiguous was not based on a reading of the text of the statute 
itself, but on the inconsistency in prior case law construing 
the statute.  In determining the statute to be ambiguous, Olstad 
observed that while "[t]he language [of Wis. Stat. § 133.03] 
itself provides no express limit to the statute's scope," this 
court had ascribed such a limit to the statute only two years 
earlier 
in 
Conley 
Publishing 
Group, 
Ltd. 
v. 
Journal 
Communications, Inc., 2003 WI 119, ¶16, 265 Wis. 2d 128, 665 
N.W.2d 879.      
No. 
2003AP2840   
 
17 
 
local 
governments 
which 
purchase 
most 
of 
their 
supplies 
through 
wholesalers, 
retailers 
or 
other 
middlemen——are left out in the cold when it comes to 
recovering for the illegally inflated prices they and 
their constituents must pay.  
Id., ¶62 (quoting Letter to Representative Marjorie Miller from 
Attorney General Bronson La Follette dated October 3, 1979, 
located in Legislative Council files, Madison, Wisconsin).  We 
note that Meyers and the putative class were indirect purchasers 
of Cipro, and that without this change they would not have had a 
cause of action under the Wisconsin Antitrust Act. 
 
¶30 Moreover, we noted in Olstad that the 1980 revision 
created a new section, Wis. Stat. § 133.01, that included a 
broad statement of legislative intent.  Id., ¶68.  This section 
provided, in part:  "It is the intent of the legislature that 
this chapter be interpreted in a manner which gives the most 
liberal construction to achieve the aim of competition."  Id.   
 
¶31 We concluded in Olstad that these changes (along with 
other legislative history material) "le[ft] little doubt of the 
legislature's intent to apply the Wisconsin antitrust statute to 
interstate commerce."  Id., ¶55.  We then held that when the 
challenged conduct does not occur within the state of Wisconsin 
and impacts interstate commerce, the Wisconsin Antitrust Act 
applies if the conduct "substantially affects" the people of 
No. 
2003AP2840   
 
18 
 
Wisconsin and has "impacts"10 in this state.  Id., ¶85.  The 
"substantially 
affects" standard comes from the following 
language in the Allied Chemical decision:  "The public interest 
and welfare of the people of Wisconsin are substantially 
affected if prices of a product are fixed or supplies thereof 
are restricted as the result of an illegal combination or 
conspiracy."  Allied Chemical, 9 Wis. 2d at 295.  
¶32 Bayer contends that the cases upon which Olstad relied 
establish two limiting principles that should govern the 
application of the "substantially affects" test.  First, Bayer 
argues plaintiffs 
must allege specific and particularized 
effects 
on 
Wisconsin 
consumers, 
not 
merely 
generalized 
allegations of nationwide effects, citing Emergency One, Inc. v. 
Waterous Co., 23 F. Supp. 2d 959 (E.D. Wis. 1998), and State v. 
Milwaukee Braves, Inc., 31 Wis. 2d 699, 144 N.W.2d 1 (1966).  
Second, Bayer argues plaintiffs must put forth allegations more 
specific than merely that some Wisconsin downstream consumers 
may have generally paid higher prices because of the challenged 
                                                 
10 The term "impacts" was not defined or described in detail 
by the court in Olstad.  See 284 Wis. 2d 224, ¶85.  The Olstad 
decision cites as its authority for the use of this term the 
"substantially affects" standard discussed in State v. Allied 
Chemical and Dye Corp., 9 Wis. 2d 290, 295, 101 N.W.2d 133 
(1960).  We construe this language in Olstad (that the Wisconsin 
Antitrust 
Act 
applies 
if 
the 
"conduct 
complained 
of 
'substantially affects' the people of Wisconsin and has impacts 
in this state, even if the illegal activity resulting in those 
impacts occurred predominantly or exclusively outside this 
state") as merely providing further clarification of the 
"substantially affects" test discussed in Allied Chemical, as 
opposed to altering that test.  
No. 
2003AP2840   
 
19 
 
conduct, citing Emergency One.  We examine the cases on which we 
relied 
in 
Olstad——Allied 
Chemical, 
Milwaukee 
Braves 
and 
Emergency 
One——to 
determine 
whether 
they 
support 
Bayer's 
argument.  
B 
¶33 The Allied Chemical case arose out of an action 
alleging monopolistic practices in violation of the Wisconsin 
Antitrust 
Act 
brought 
by 
the 
attorney 
general 
against 
manufacturers and sellers of the chemical calcium chloride.  At 
the time of the state suit, the Federal Trade Commission (FTC) 
was already investigating allegations of price-fixing against 
the calcium chloride companies, and the trial court dismissed 
the complaint on grounds that the federal regulatory agency had 
taken exclusive jurisdiction over the matter.  Allied Chemical, 
9 Wis. 2d at 293.  
¶34 This court reversed the trial court's dismissal, 
concluding that federal antitrust law did not preempt state 
efforts to enact and enforce effective legislation against 
monopolistic practices.  Id. at 295.  The court further 
concluded that there was no conflict between the federal and 
state statutes, that the Wisconsin statutes made no attempt to 
regulate or burden interstate commerce, and that the FTC was not 
established to enforce the federal antimonopoly statutes but to 
regulate certain trade practices instead.  Moreover, the court 
cited letters in the record from FTC officials and the 
Department of Justice that indicated that the attitude of the 
federal government was to cooperate with the state in its 
No. 
2003AP2840   
 
20 
 
efforts to enforce state statutes dealing with conspiracies and 
monopolies.  Id. at 295-96.  Importantly, the Allied Chemical 
court held that the Wisconsin antitrust statute was enacted to 
protect state consumers from the effects of monopolistic 
practices.  Id. 
¶35 In Milwaukee Braves, the State brought an action under 
the Wisconsin Antitrust Act in response to the departure from 
Wisconsin of the Milwaukee Braves professional baseball club.  
Although the Milwaukee Braves court declined to enforce Chapter 
133, in part because of major league baseball's well-settled 
exemption from antitrust regulation, all seven members of the 
court asserted that the Wisconsin Antitrust Act could be applied 
to 
interstate 
commerce.  Olstad, 284 Wis. 2d 224, ¶27 
(discussing Milwaukee Braves, 31 Wis. 2d at 725).  The Milwaukee 
Braves court noted that the exercise of the defendants' monopoly 
power caused "substantial injury to business activity within 
Wisconsin" such that the court would "assume, at this point, 
that a violation of Wisconsin law has occurred if our law can be 
applied."  Milwaukee Braves, 31 Wis. 2d at 719.  Nevertheless, 
the court recognized that while "[t]he state may, ordinarily, 
protect the interests of its people by enforcing its antitrust 
act against persons doing business in interstate commerce," the 
state policy must yield when a conflict exists between state and 
federal policy.  Id. at 721.   
¶36 In Emergency One, a Wisconsin federal district court 
considered the issue of whether the Wisconsin Antitrust Act 
reaches interstate commerce several years before our decision in 
No. 
2003AP2840   
 
21 
 
Olstad.  Emergency One, a Florida-based manufacturer of fire 
trucks, 
sued 
a 
Wisconsin 
truck 
manufacturer 
and 
two 
manufacturers of fire pump hoses, alleging the three companies 
conspired to choke competition in the United States market for 
fire pumps, in violation of Wisconsin's Antitrust Act.  The 
Emergency One court carefully examined our precedents and the 
legislative history of Wis. Stat. § 133.03 and concluded that 
the Wisconsin Antitrust Act reaches interstate commerce to some 
degree.  Emergency One, 23 F. Supp. 2d at 966.   
¶37 To determine when the statute would apply in cases 
involving interstate commerce, the Emergency One court relied on 
an "adverse effects" standard that is, in essence, the test we 
adopted in Olstad.  Emergency One, 23 F. Supp. 2d at 969-970.  
The Emergency One court explained that the "adverse effects" 
test "extend[s] the jurisdictional scope of Wisconsin antitrust 
law to unlawful activity which has significantly and adversely 
affected trade and economic competition within this state."  Id. 
at 969.  In examining and ultimately rejecting other approaches 
to determine when the antitrust act applies in cases involving 
No. 
2003AP2840   
 
22 
 
interstate commerce,11 the Emergency One court concluded that "an 
adverse effects standard is the only standard that remains 
faithful to the purpose of Chapter 133——to protect and encourage 
competition in this state, by penalizing interstate activities 
that adversely affect it."  Id. at 970. 
¶38 Applying this effects-based standard, the Emergency 
One court concluded that the complaint "d[id] not allege 
significant and adverse effects on economic competition in 
Wisconsin."  Id. at 971.   
Based on the amended complaint . . . the connection 
between plaintiff's injury and Wisconsin commerce is 
tenuous at best.  E-One identifies three Wisconsin 
dealerships of 
a number allegedly maintained by 
                                                 
11 The Emergency One court considered two alternate tests 
for determining whether state antitrust law applies in cases 
involving interstate commerce:  (1) A "contacts-based" standard 
that emphasizes "the nature and degree of defendant's contacts 
with Wisconsin" bearing similarities to the International Shoe 
Co. v. Washington, 326 U.S. 310 (1945), test in the law of 
personal 
jurisdiction, 
and 
the 
"aggregation 
of 
contacts" 
standard set forth in Allstate Ins. Co. v. Hague, 449 U.S. 302, 
308 (1981), to resolve "choice of law" disputes; and (2) A 
"predominance" standard, which would apply state antitrust law 
only 
to 
transactions 
and 
commerce 
that 
is 
predominantly 
intrastate in nature.  Emergency One v. Waterous Co., Inc., 23 
F. Supp. 2d 959, 967-969 (E.D. Wis. 1998).  The federal district 
court rejected the "contacts-based" standard because, in cases 
involving nationwide sales, application of a "contacts-based" 
standard might result in application of state antitrust law when 
no significant injury to trade and economic competition occurred 
in the state.  The court rejected the "predominance" standard on 
grounds that it would essentially reintroduce federal preemption 
of state anti-trust law (commerce cannot be both predominantly 
interstate and predominantly intrastate in nature) "a result 
consistently rejected by the Supreme Court."  See Emergency One, 
23 F. Supp. 2d at 967 (citing California v. ARC America Corp., 
490 U.S. 93, 102 (1989)).   
No. 
2003AP2840   
 
23 
 
plaintiff over the years.  The specific dates of 
operation 
suggest 
that 
only 
one 
dealership 
in 
Wisconsin was maintained by E-One at any given time, 
however.  Plaintiff does not estimate the amount of 
sales at such dealerships in a certain time frame or 
suggest what proportion of those sales were affected 
by defendants' conduct.  Plaintiff does not indicate 
how many fire trucks are sold in Wisconsin per year, 
how many by plaintiff, or how many by plaintiff's 
competitors.  Indeed, plaintiff does not identify a 
single fire truck contract in Wisconsin from which E-
One 
was 
precluded 
from 
bidding 
based 
on 
the 
unavailability of Waterous pumps.  Without this type 
of information, the amended complaint does not suggest 
that injury to E-One also constituted significant 
injury to trade and commerce related to fire truck 
sales in Wisconsin. 
Id.  The court concluded:  "[T]he only significant and adverse 
effect alleged by plaintiff is to plaintiff itself."  Id.  
 
¶39 Relying on the above cases, Bayer makes essentially 
three arguments.  First, Bayer asserts that all of these cases 
stand for the proposition that plaintiffs bringing suit under 
the Wisconsin Antitrust Act must specifically allege the 
challenged conduct had Wisconsin impacts.  Second, citing 
language from Milwaukee Braves noting that the departure of the 
Braves from the state "terminated very substantial business 
activity in Wisconsin," Bayer suggests that the plaintiffs must 
also allege that these Wisconsin impacts were disproportionate 
to nationwide impacts.  Third, Bayer asserts that the analysis 
of the Emergency One court demonstrates that "bare allegations" 
that indirect purchasers in Wisconsin paid higher prices as a 
result of the challenged conduct is not sufficient to meet the 
"substantially affects" standard.  We consider each of these 
arguments in turn. 
No. 
2003AP2840   
 
24 
 
¶40 Bayer is correct that a plaintiff must allege that the 
conduct complained of has impacts in Wisconsin, and not merely 
nationwide impacts.  Olstad, 284 Wis. 2d 224, ¶85.  The cases 
demonstrate that the focus of the "substantially affects" 
standard is properly on Wisconsin, and the sufficiency of the 
plaintiff's claim depends on whether the complaint alleges that 
the conduct "substantially affects" the people of Wisconsin.  
However, when determining on a motion to dismiss whether a 
complaint under the Wisconsin Antitrust Act alleges that the 
challenged 
conduct 
"substantially affected" the people of 
Wisconsin, 
courts 
apply, 
as 
on 
any 
motion 
to 
dismiss, 
Wisconsin's notice pleading statute, Wis. Stat.  § 802.02(1)(a).   
¶41 "For well over 100 years, this court has consistently 
held that pleadings shall be liberally construed with a view to 
substantial justice between the parties."  J.L. Phillips & 
Assoc. v. E&H Plastic Corp., 217 Wis. 2d 348, 365, 577 N.W.2d 13 
(1998) (citation omitted).  "[A] complaint in a civil action 
should not be dismissed as legally insufficient unless it is 
clear that there are no circumstances under which the plaintiff 
can recover."  Lewis, 188 Wis. 2d at 164.   
¶42 There is no exception to this rule for actions under 
the Wisconsin Antitrust Act.  In Grams, 97 Wis. 2d 332, an 
insurance agency brought suit against another insurance company 
and 
a 
hospital 
service 
corporation, 
alleging 
antitrust 
violations.  Writing for the majority, Justice Abrahamson 
concluded 
that 
while 
the 
plaintiffs' 
complaint 
was 
"barebone . . . conclusory in part, and may have failed to state 
No. 
2003AP2840   
 
25 
 
sufficient facts" under prior pleading rules, it was sufficient 
to state a claim under the notice pleading statute.  Id. at 352. 
¶43 In 
light 
of 
our 
liberal 
pleadings 
standard, 
a 
complaint 
under 
the 
Wisconsin 
Antitrust 
Act, 
where 
the 
circumstances involve interstate commerce and the challenged 
conduct occurred outside of Wisconsin, is sufficient if it 
alleges price fixing as a result of the formation of a 
combination or conspiracy that substantially affected the people 
of Wisconsin and had impacts in this state.  As Meyers asserts, 
requiring greater specificity than the notice pleading statute 
demands would create a heightened pleading standard for Chapter 
133 actions that would bar otherwise legitimate suits, thus 
undermining the Act's purposes of fostering competition and 
prohibiting unfair and discriminatory business practices.  See 
Wis. Stat. § 133.01.   
¶44 We decline to follow Bayer's suggestion that the 
impacts 
of 
the 
challenged 
conduct 
on 
Wisconsin 
must 
be 
distinguishable from or disproportionate to its impacts on other 
states.  Under Olstad, the complaint must simply allege that the 
challenged 
conduct 
"'substantially affects' the people of 
Wisconsin and has impacts in this state," not that these impacts 
be disproportionately felt in Wisconsin.  Olstad, 284 Wis. 2d 
224, ¶85.   
¶45 Bayer apparently takes the fact that the Emergency One 
and Milwaukee Braves courts focused (properly) on the impacts 
felt in Wisconsin to mean that plaintiffs filing an action under 
Chapter 133 must assert allegations of disproportionate impacts 
No. 
2003AP2840   
 
26 
 
on Wisconsin.  As the Department of Justice asserts in its 
amicus brief, this approach would subject a defendant that 
targets the effects of its illegal conduct on Wisconsin to 
treble damages under Chapter 133, while another defendant that 
causes equal or greater harm in Wisconsin would be immune from 
suit simply because the latter defendant's harms were evenly 
spread across the country.  Neither the statute nor our case law 
requires that plaintiffs allege that the challenged conduct 
caused 
disproportionate 
injury 
to 
Wisconsin 
consumers.  
Plaintiffs need only allege that the conduct substantially 
affected the people of Wisconsin and had impacts in this state.  
Olstad, 284 Wis. 2d 224, ¶85.   
¶46 Turning to Bayer's contention that the "substantially 
affects" standard requires more than "bare allegations" that 
indirect purchasers in Wisconsin paid higher prices as a result 
of the challenged conduct, we disagree.  This argument is based 
on a misreading of Emergency One and, moreover, is plainly 
contrary to Wis. Stat. §§ 133.03 and 133.18.   
¶47 Bayer contends that the Emergency One court held that 
the plaintiff's allegations of supracompetitive prices were not 
sufficient to state a claim under the Wisconsin Antitrust Act.  
This misstates the holding of Emergency One.  The Emergency One 
court dismissed the plaintiff's claim because it concluded that 
the plaintiff's complaint "made no . . . allegations" of "any 
significant adverse effects on trade and economic competition 
within Wisconsin."  Emergency One, 23 F. Supp. 2d at 970.  The 
Emergency 
One 
court 
carefully 
examined 
the 
complaint 
to 
No. 
2003AP2840   
 
27 
 
ascertain whether it alleged "significant adverse effects" to 
support a claim under state antitrust law.  Id. at 970-71.  
Based on this examination, the court concluded that the 
plaintiff failed to state a claim under the Wisconsin Antitrust 
Act.  Id.  It did not dismiss the complaint based on a per se 
rule that "bare allegations" that indirect purchasers in 
Wisconsin paid higher prices is insufficient to state a claim 
under the act. 
¶48 The Wisconsin Antitrust Act specifically provides a 
remedy for indirect purchasers who suffer harm as a result of 
conduct that violates Chapter 133.  See Wis. Stat. § 133.18 
("[A] person injured, directly or indirectly, by reason of 
anything prohibited by this chapter may sue . . . and shall 
recover . . . damages.") (emphasis added).  In Olstad, we noted 
that the 1980 revision of Chapter 133 provided a remedy under 
the statute to indirect purchasers in response to Illinois 
Brick, 431 U.S. 720, which foreclosed recovery to indirect 
purchasers under the federal statute.  An allegation that 
thousands of Wisconsin consumers paid supracompetitive prices as 
a result of monopolistic conduct by an interstate seller 
therefore states a basis for recovery under the statute.   
¶49 The test we crafted in Olstad for determining when, in 
circumstances involving interstate commerce where the challenged 
conduct occurred outside of Wisconsin, a complaint states a 
claim under the Wisconsin Antitrust Act was derived in part from 
this court's decision in Allied Chemical, 9 Wis. 2d 290.  Like 
the present case, Allied Chemical involved allegations of a 
No. 
2003AP2840   
 
28 
 
conspiracy 
to 
fix 
prices 
to 
the 
detriment 
of 
Wisconsin 
consumers.  This court held in Allied Chemical that price-fixing 
is 
a 
monopolistic 
practice 
that, 
by 
its 
very 
nature, 
substantially affects the public.  
The public interest and welfare of the people of 
Wisconsin are substantially affected if prices of a 
product are fixed or supplies thereof are restricted 
as the result of an illegal combination or conspiracy. 
The people of Wisconsin are entitled to the advantages 
that flow from free competition in the purchase of 
calcium chloride and other products, and if the state 
is able to prove the allegations made in its complaint 
it is apparent that the acts of the defendants deny to 
them those advantages.  
Id. at 295.  
¶50 Amici Wisconsin Manufacturers and Commerce (WMC) and 
Milwaukee Metropolitan Area Chamber of Commerce (MMAC) point us 
to Szukalski v. Crompton Corp., 2006 WI App 195, 296 Wis. 2d 
728, 726 N.W.2d 304.  There, the court of appeals affirmed a 
circuit court dismissal of an antitrust lawsuit brought by a 
group of tire buyers alleging several companies engaged in the 
manufacture and sale of chemicals used to process rubber 
conspired to fix prices.  In determining the scope of the 
"substantially affects" test, the Szukalski court held that 
plaintiffs must allege "(1) specific effects on Wisconsin 
commerce, not merely effects that are nationwide, and (2) that 
these effects on Wisconsin are more than a general nationwide 
effect on the price," citing Emergency One, 23 F. Supp 2d at 
971, and a recent decision of the Tennessee Supreme Court, 
Freeman Industries, LLC v. Eastman Chemical Co., 172 S.W.3d 512 
No. 
2003AP2840   
 
29 
 
(Tenn. 2005).  Szukalski, 726 N.W.2d 304, ¶20.  While noting 
that Szukalski is not before us, we address it to resolve any 
inconsistencies between it and our decision today.   
¶51 Szukalski correctly states that a complaint must 
allege effects on Wisconsin, and not merely nationwide effects.12  
However, 
its 
conclusion 
that 
the 
"substantially 
affects" 
standard requires allegations "that these effects on Wisconsin 
are more than a general nationwide effect on the price" 
misstates the Olstad standard, and is inconsistent with our 
opinion today.  See supra, ¶¶45-46.  As noted, plaintiffs need 
not 
allege that the challenged conduct disproportionately 
affected 
Wisconsin, 
only 
that 
the 
challenged 
conduct 
substantially affected the people of Wisconsin and had impacts 
in this state.  Olstad, 284 Wis. 2d 224, ¶85. 
¶52 Finally, Bayer and amici WMC and MMAC contend that 
certain limitations on actions under the Wisconsin Antitrust Act 
are necessary for judicial economy and preserving a favorable 
business climate in Wisconsin.  They assert that if the court 
does not adopt their proposed limitations to the "substantially 
affects" test, Wisconsin courts will be flooded with complex 
antitrust 
litigation. 
 
They 
maintain 
that 
without 
these 
                                                 
12 Because Szukalski v. Crompton Corp., 2006 WI App 195, 296 
Wis. 2d 728, 726 N.W.2d 304, no petition for review filed, is 
not before us, and we have not had an opportunity to review the 
plaintiff's complaint in Szukalski to determine its sufficiency, 
we do not address the Szukalski court’s conclusion that the 
plaintiff failed to allege substantial Wisconsin effects.  
No. 
2003AP2840   
 
30 
 
limitations the specter of antitrust litigation would create a 
hostile atmosphere for businesses in Wisconsin.   
 
¶53 To adopt on policy grounds the limitations Bayer and 
amici propose would be to substitute our own judgment for that 
of the legislature.  By establishing a broad antitrust act that 
provides remedies to consumers not available under federal 
antitrust law, the legislature has made clear policy choices in 
the area of antitrust regulation.  The "substantially affects" 
test adopted in Olstad is consistent with the legislature's 
policy choices; requiring more of plaintiffs would close off 
consumer suits, particularly those by indirect purchasers, 
contrary to the 1980 revision of the statute.  Moreover, it 
would bar otherwise legitimate actions, thereby undermining the 
statute's purpose "to foster and encourage competition by 
prohibiting unfair and discriminatory practices which destroy or 
hamper competition."  See Wis. Stat. § 133.01.  We decline to 
substitute our judgment for that of the legislature.  See Flynn 
v. Dep't of Admin., 216 Wis. 2d 521, 539, 576 N.W.2d 245 (1998) 
("This court has long held that it is the province of the 
legislature, not the courts, to determine public policy.").13   
C 
 
¶54 We turn now to Meyers' complaint to determine if it 
alleges that the conduct of Bayer and the generic manufacturers 
                                                 
13 As to the merits of these policy arguments, we note that 
Bayer and amici fail to provide empirical support for the 
proposition that failure to limit the applicability of the 
Wisconsin Antitrust Act would harm Wisconsin's business climate. 
No. 
2003AP2840   
 
31 
 
substantially affected the people of Wisconsin and had impacts 
in this state. 
 
¶55 Meyers' complaint alleges, in the course of 35 pages 
and 106 paragraphs, a broad price-fixing scheme affecting "at a 
minimum, thousands . . . in Wisconsin."  The complaint states 
that the named plaintiffs and the putative class are Wisconsin 
residents who purchased the antibiotic Cipro "at any time since 
January 6, 1995," the date that Meyers alleges the market for 
Cipro and generic equivalents would have opened to competition.  
The complaint states that Cipro was the best-selling antibiotic 
in the world throughout most of the 1990s.  It avers that Bayer 
posted $1 billion in sales of Cipro in the United States in 1999 
alone.  It states that as a result of the Agreement among Bayer 
and the generic manufacturers, Bayer maintained its monopoly in 
the United States market for Cipro; that from January 1997 to 
December 1998, Bayer increased its price for Cipro by 16.7%; and 
that from 1998 to 1999, Bayer's United States revenues for Cipro 
increased 25%, while its net profits increased 22%.   
¶56 While Meyers' complaint alleges harm to "thousands of 
Wisconsin residents," the Emergency One complaint, by contrast, 
alleged a conspiracy adversely affecting "only . . . plaintiff 
itself."  Emergency One, 23 F. Supp. 2d at 971.  The plaintiff 
in Emergency One was a fire truck manufacturer that apparently 
maintained only one dealership in Wisconsin.  Id. at 960-61.  
The plaintiff's complaint did not state the number of sales it 
made in Wisconsin per year, although it certainly would have had 
No. 
2003AP2840   
 
32 
 
this information.14  Id. at 971.  The plaintiff did not indicate 
a time frame in which the people of Wisconsin suffered injury as 
a result of alleged monopolistic practices.  Id.  And the 
company itself was a Delaware corporation, with a principal 
place of business in Florida, and thus, any injury suffered by 
the company resulting in lay-offs or lost profits would have 
likely had a negligible effect on Wisconsin workers and 
investors.  Id. at 970-71.  
¶57 Here, 
Meyers 
alleges 
"thousands 
of 
Wisconsin 
residents" suffered economic harm as a result of Bayer's alleged 
monopolistic practices, starting January 6, 1995.  An allegation 
that a group of pharmaceutical companies conspired to maintain 
monopoly prices on a best-selling prescription drug purchased by 
thousands of Wisconsin residents over several years meets the 
"substantially 
affects" 
test 
set 
forth 
in 
Olstad, 
284 
Wis. 2d 224, ¶85.  We conclude that Meyers has sufficiently 
alleged that the challenged conduct of Bayer and the generic 
manufacturers substantially affected the people of Wisconsin and 
had impacts in this state.  We therefore affirm the court of 
appeals' reversal of the circuit court's order dismissing the 
complaint.   
IV 
¶58 In summary, we reaffirm the following standard set 
forth in Olstad for determining when Chapter 133 reaches 
                                                 
14 The complaint in Emergency One, 23 F. Supp. 2d 959, 
alleged only that 3500 to 4000 fire trucks are purchased by fire 
departments in the United States annually. 
No. 
2003AP2840   
 
33 
 
interstate commerce:  A plaintiff filing an action under 
Wisconsin's Antitrust Act must allege price fixing as a result 
of 
the 
formation 
of 
a 
combination 
or 
conspiracy 
that 
"substantially affects the people of Wisconsin and has impacts 
in this state" when the challenged conduct occurs predominately 
or exclusively outside this state.  Olstad, 284 Wis. 2d 224, 
¶85.  We conclude that additional limitations Bayer and amici 
MMAC and WMC seek to read into the "substantially affects" 
standard are unsupported by our precedents and are contrary to 
the policy choices of the legislature.   
 
¶59 Meyers' 35-page, 106-paragraph complaint alleges a 
broad 
price-fixing 
scheme 
affecting 
"at 
a 
minimum, 
thousands . . . in Wisconsin" who purchased the best-selling 
antibiotic Cipro "at any time since January 6, 1995."  We 
conclude Meyers' complaint alleges illegal conduct that, if 
true, substantially affected the people of Wisconsin and had 
impacts in this state.15  We therefore affirm the court of 
appeals' decision reversing the circuit court's order dismissing 
Meyers' claims, and remand the matter to the circuit court for 
further proceedings consistent with this opinion.  
                                                 
15 As we previously indicated, supra, ¶4 n.4, issues 
regarding the validity or invalidity of the Cipro patent, and 
the effect of the possible invalidity of the patent on the 
legality of the Agreements have not been briefed by the parties, 
have not been developed in the record in this motion to dismiss, 
and are not properly before this court.  These matters may be 
addressed by the circuit court on remand.  
No. 
2003AP2840   
 
34 
 
By the Court.—The decision of the court of appeals is 
affirmed, and the cause is remanded to the circuit court for 
further proceedings consistent with this opinion. 
 
 
No.  2003AP2840.dtp 
 
1 
 
¶60 DAVID T. PROSSER, J.   (dissenting).  Four years ago 
in Conley Publishing Group Ltd. v. Journal Communications, Inc., 
2003 WI 119, 265 Wis. 2d 128, 665 N.W.2d 879, this court was 
confronted with the question whether we should adopt Brooke 
Group Ltd. v. Brown & Williamson Tobacco Corp., 509 U.S. 209 
(1993), as the law of Wisconsin governing predatory pricing 
under Wis. Stat. § 133.03.  As we answered this question, we 
noted that "Wisconsin courts have [long] followed federal court 
interpretations of Sections 1 and 2 of the Sherman Act and have 
construed Wisconsin antitrust statutes in conformity with these 
federal court interpretations."  Conley, 265 Wis. 2d 128, ¶17.   
¶61 In the course of explaining why Wisconsin should 
follow federal law, the writer of the opinion observed that 
"there is presently no Wisconsin case law governing predatory 
pricing claims under § 133.03(2)."  Id., ¶16.  "The dearth of 
state antitrust precedent is not surprising because the scope of 
Chapter 133 is limited to intrastate transactions.  See Reese v. 
Associated Hosp. Serv., 45 Wis. 2d 526, 532, 173 N.W.2d 661 
(1970)."  Id. 
¶62 Two years later, the same writer was forced to 
withdraw the phrase "the scope of Chapter 133 is limited to 
intrastate transactions" because the court unanimously upheld 
the application of Wisconsin's Little Sherman Act to interstate 
commerce in some circumstances.  Olstad v. Microsoft Corp., 2005 
WI 121, ¶¶13, 74, 284 Wis. 2d 224, 700 N.W.2d 139. 
¶63 Having 
opened 
the 
door 
to 
interstate 
antitrust 
enforcement in some circumstances, the court thought it ought to 
No.  2003AP2840.dtp 
 
2 
 
comment briefly on what those "circumstances" were, even though 
that question had not been briefed.   
¶64 Early in the opinion, the court quoted Professor 
Herbert Hovenkamp to the effect that "a state antitrust law of 
general application can virtually always be applied to a 
practice having sufficient effects within the state."  Id., ¶14 
(emphasis added) (citation omitted).  Then we added, "State law 
is precluded from regulating interstate commerce only if it 
'unduly burden[s]' interstate commerce."  Id. (citing Von 
Kalinowski, Antitrust Laws & Trade Regulation § 100.03 (2d. ed. 
2004)). 
¶65 At the end of the opinion, the court said: 
 
A 
civil 
plaintiff 
filing 
an 
action 
under 
Wisconsin's 
antitrust 
act 
must 
allege 
that 
(1) 
actionable conduct, such as the formation of a 
combination or conspiracy, occurred within this state, 
even if its effects are felt primarily outside 
Wisconsin; 
or 
(2) 
the 
conduct 
complained 
of 
"substantially affects" the people of Wisconsin and 
has impacts in this state, even if the illegal 
activity 
resulting 
in 
those 
impacts 
occurred 
predominantly 
or 
exclusively 
outside 
this 
state.  
[State 
v.] 
Allied 
Chemical 
[& 
Dye 
Corp.], 
9 
Wis. 2d [290,] 
295[, 
101 
N.W.2d 133 
(1960)].  
Operating with lesser standards would jeopardize the 
action, undermine the validity of our antitrust 
statute, and create the spectacle of Lilliputian 
harassment 
in 
Wisconsin 
courts. 
 
Questions 
of 
provincialism, 
favoritism, 
and 
undue 
burden 
on 
interstate commerce should be determined by resort to 
contemporary federal commerce clause jurisprudence.  
To say more is beyond the scope of this opinion. 
Id., ¶85. 
¶66 Four things should be noted about this paragraph.  
First, the words "substantially affects" were borrowed from 
No.  2003AP2840.dtp 
 
3 
 
Allied Chemical.  Second, the words "substantially affects" 
imply a higher standard than "sufficient effects," quoted 
earlier in the opinion.  Third, the second point is underscored 
by the following sentence: "Operating with lesser standards 
would jeopardize the action, undermine the validity of our 
antitrust statute, and create the spectacle of Lilliputian 
harassment in Wisconsin courts."  Fourth, the paragraph requires 
"impacts in this state." 
¶67 In interpreting the phrase "jeopardize the action," it 
should be remembered that the court had recently considered two 
cases exploring the reach of Wisconsin jurisdiction.  See State 
v. Derek Anderson, 2005 WI 54, 280 Wis. 2d 104, 695 N.W.2d 731; 
and Tammie J.C. v. Robert T.R., 2003 WI 61, 262 Wis. 2d 217, 663 
N.W.2d 734.  The court did not want to encourage litigation that 
exceeded the jurisdiction of the state.  As for the phrase 
"undermine the validity of our antitrust statute," Olstad 
discussed such issues as federal preemption and burden on 
interstate commerce in the opinion, and that context gives the 
phrase meaning.  "Lilliputian harassment" conveys the image of a 
commercial Gulliver tied down by a multitude of antitrust 
litigants across the country. 
¶68 Olstad speaks of "actionable conduct, such as the 
formation of a combination or conspiracy . . . within this 
state."  Olstad, 284 Wis. 2d 224, ¶85.  Surely, our statute is 
most potent when "actionable conduct" is formed within this 
jurisdiction. 
 
Conversely, when "illegal activity" occurs 
predominantly or exclusively outside this jurisdiction but has 
No.  2003AP2840.dtp 
 
4 
 
impacts in Wisconsin, the impacts in Wisconsin ought to be more 
substantial than what is "sufficient" for a purely Wisconsin 
"combination or conspiracy."  Olstad did not intend to convert 
every antitrust violation anywhere into a violation of Wisconsin 
law simply because the violation affected some people in 
Wisconsin. 
¶69 Because I am unable to discern from the discussion in 
the majority opinion any meaningful limitation on antitrust 
suits 
against 
illegal 
activities 
outside 
this 
state, 
I 
respectfully dissent. 
 
 
No.  2003AP2840.pdr 
 
1 
 
¶70 PATIENCE 
DRAKE 
ROGGENSACK, 
J. 
(dissenting).   The 
majority opinion concludes that the second amended complaint 
(the complaint) of the plaintiffs sufficiently alleges a 
violation of Wisconsin's antitrust law, Wis. Stat. § 133.03 
(2005-06),1 to withstand a motion to dismiss.  Majority op., ¶4.  
It does so based on the complaint's allegations that an 
agreement concerning ciprofloxacin hydrochloride between Bayer 
AG and Barr Laboratories, Inc. (the Bayer-Barr agreement)2 is a 
"price-fixing 
scheme" 
for 
ciprofloxacin 
hydrochloride 
that 
controlled the price for the drug "at any time since January 6, 
1995."  Id.  The majority opinion concludes that, if proved, the 
price-fixing alleged is "illegal conduct" that "substantially 
affected the people of Wisconsin and had impacts in this state" 
thereby violating Wisconsin antitrust law.  Id.  However, it 
also recognizes that there are significant questions about the 
effect that Bayer's patent may have on the plaintiffs' claims.  
Id., ¶4 n.4.  It suggests that those questions be addressed in 
the circuit court on remand.  Id.   
¶71 I dissent because I would resolve the effect of 
Bayer's patent on the plaintiffs' claims at this time.  I would 
do 
so 
because 
Bayer 
was 
granted 
a 
federal 
patent 
for 
ciprofloxacin hydrochloride (the Cipro patent) that, in order to 
have subject matter jurisdiction for this antitrust action, 
                                                 
1 All further references to the Wisconsin Statutes are to 
the 2005-06 version, unless otherwise noted. 
2 The Bayer-Barr agreement, about which the plaintiffs 
complain, is not in the record before us. 
No.  2003AP2840.pdr 
 
2 
 
Wisconsin courts must presume is valid.  28 U.S.C. § 1338(a).  
Presuming that Bayer's patent is valid, I conclude that the 
complaint does not allege facts that, if true, are sufficient to 
show illegal conduct or conduct that has an illegal effect.  E. 
Bement & Sons v. Nat'l Harrow Co., 186 U.S. 70, 91 (1902).  Only 
illegal conduct or conduct that has an illegal effect violates 
Wisconsin's antitrust law.  Prentice v. Title Ins. Co. of Minn., 
176 Wis. 2d 714, 725, 500 N.W.2d 658 (1993); State v. Allied 
Chem. & Dye Corp., 9 Wis. 2d 290, 296, 101 N.W.2d 133 (1960).  
Furthermore, because the conduct alleged in the complaint is not 
illegal or alleged to have had an illegal effect, it cannot 
"substantially 
affect" 
the 
people 
in 
Wisconsin 
and 
have 
"impacts" in Wisconsin contrary to Wis. Stat. § 133.03.  Olstad 
v. Microsoft Corp., 2005 WI 121, ¶85, 284 Wis. 2d 224, 700 
N.W.2d 139.  Accordingly, I would affirm the circuit court's 
dismissal of the complaint for failure to state a claim pursuant 
to Wis. Stat. § 802.06(2)(a)6, albeit on different grounds.  
Therefore, I respectfully dissent. 
I.  BACKGROUND3 
¶72 The gravamen of the complaint is that the agreement 
between 
Bayer, 
who 
owns 
the 
patent 
for 
ciprofloxacin 
hydrochloride that it markets under the trade name, "Cipro," and 
Barr, 
who 
applied 
to 
the 
United 
States 
Food 
and 
Drug 
                                                 
3 The facts used in the background narration have been taken 
from the complaint and from the public records of the United 
States Food and Drug Administration (FDA) and the United States 
Patent and Trademark Office (PTO).  We may take judicial notice 
of public records of governmental agencies.  Perkins v. State, 
61 Wis. 2d 341, 346, 212 N.W.2d 141 (1973). 
No.  2003AP2840.pdr 
 
3 
 
Administration (FDA) for permission to manufacture and market a 
generic form of Cipro, is a price-fixing agreement that effected 
a monopoly for Cipro in Wisconsin.  The complaint alleges 
Bayer's monopoly is illegal and violates Wis. Stat. § 133.03(2).   
¶73 As background for this theory, the plaintiffs allege 
that Bayer held the patent for the active ingredient of Cipro, 
ciprofloxacin hydrochloride, and that the Cipro patent was 
granted to Bayer on May 29, 1984, as Patent No. 4,670,444.  
Bayer also received FDA approval to market Cipro in October of 
1987.  Bayer's initial patent for Cipro expired in December of 
2003.4 
¶74 On October 27, 1991, Barr applied to the FDA to 
manufacture and market a generic form of Cipro.  Barr used a 
shortened form of application for FDA approval that is known as 
an Abbreviated New Drug Application, or ANDA.  As part of the 
ANDA process, Barr asserted that its generic drug was the 
bioequivalent 
of 
Cipro. 
 
This 
assertion 
permitted 
FDA 
consideration of Barr's generic Cipro without the years of 
testing that Bayer had to undergo in order to obtain FDA 
approval for Cipro.  Therefore, by piggybacking on Bayer's 
lengthy FDA new drug testing requirements, Barr's ANDA applied 
for FDA approval for the same drug to which the FDA had given 
Bayer approval.  In its ANDA, Barr also alleged that Bayer's 
patent was invalid, which is one of the allegations required in 
order for the FDA to give preliminary approval to a generic 
                                                 
4 The public records of the PTO show that the PTO extended 
Bayer's patent for Cipro through June 8, 2004. 
No.  2003AP2840.pdr 
 
4 
 
equivalent 
of 
a 
patented 
drug. 
 
See 
21 
U.S.C. 
§ 355(j)(2)(A)(vii)(IV). 
¶75 As is required by federal statute, Barr gave notice of 
its ANDA to Bayer.  See 21 U.S.C. § 355(j)(2)(B)(iii).  Within 
the statutory timeline of receiving Barr's notice (45 days), 
Bayer filed a patent infringement suit against Barr.  A patent 
infringement suit is required by federal statutes as a precursor 
to maintaining patent priority over a pending ANDA for the 
generic equivalent 
of a patented drug.  See 21 U.S.C. 
§ 355(j)(5)(B)(iii).   
¶76 The filing of Bayer's patent infringement suit stayed 
Barr's ANDA before the FDA for 30 months or until the conclusion 
of the patent infringement suit, whichever occurred first.  See 
id.  That 30-month stay would have ended on July 16, 1994.  
However, prior to settling Bayer's suit against Barr for patent 
infringement, Bayer and Barr executed a stipulation to extend 
the 30-month stay until a final judgment on the pending patent 
litigation was entered.  The district court approved the 
stipulation and ordered that final consideration of Barr's ANDA 
before the FDA was stayed until the patent litigation concluded.  
Bayer AG v. Barr Labs., No. 92CV391 (S.D.N.Y. Dec. 9, 1992); see 
also 21 U.S.C. § 355(j)(5)(B)(iii). 
¶77 On January 6, 1995, the FDA gave "tentative approval" 
to Barr to market its drug, which approval was subject to 
Bayer's patent being held invalid or expiring.  FDA's public 
No.  2003AP2840.pdr 
 
5 
 
records show that FDA final approval to manufacture and market a 
generic form of Cipro was not given to Barr until June 9, 2004.5    
¶78 The complaint does not allege that the conduct set out 
in the Bayer-Barr agreement falls outside of Bayer's rights 
under the Cipro patent.  It also does not allege that Barr, or 
anyone else, has ever contended that Bayer obtained its Cipro 
patent through fraud on the United States Patent & Trademark 
Office (PTO).  Rather, the complaint asserts that the Bayer-Barr 
agreement was entered into on January 8, 1997, and that it 
allocates "the entire United States market for Cipro to Bayer 
for at least six years" (January 2003) and that at Bayer's 
option Bayer could either:  (1) supply Cipro for sale as a 
generic to Barr, who would operate as Bayer's licensee, or (2) 
supply all of the Cipro to purchasers itself and make specified 
payments to Barr.6   
¶79 The Bayer-Barr agreement, together with a consent 
judgment, concluded Bayer's federal patent infringement suit.  
The consent judgment affirmed that Bayer owns the patent for 
Cipro; that it is valid and enforceable; and that Barr's generic 
form of Cipro infringed Bayer's patent. Bayer AG v. Barr Labs., 
No. 92CV391 (S.D.N.Y. Jan. 16, 1997).  There has been no appeal 
or collateral attack on that judgment.   
                                                 
5 We may take judicial notice of public records of 
governmental agencies.  Perkins, 61 Wis. 2d at 346. 
6 Payments such as these are commonly referred to as 
"reverse" or "exit" payments.  Anne-Marie C. Yvon, Settlements 
Between 
Brand 
and 
Generic 
Pharmaceutical 
Companies: 
 
A 
Reasonable Antitrust Analysis of Reverse Payments, 75 Fordham L. 
Rev. 1883, 1884 n.9 (2006).  
No.  2003AP2840.pdr 
 
6 
 
¶80 Subsequent 
to 
the 
conclusion 
of 
the 
patent 
infringement action, Bayer re-submitted its patent to the PTO 
for review.  Bayer's patent for Cipro was upheld in that 
proceeding as well.   
II.  DISCUSSION 
A. 
Standard of Review 
¶81 A motion to dismiss challenges the legal sufficiency 
of the complaint to state a claim on which relief may be 
granted.  Kaloti Enters., Inc. v. Kellogg Sales Co., 2005 WI 
111, ¶11, 283 Wis. 2d 555, 699 N.W.2d 205.  For purposes of the 
motion, we generally accept as true all factual allegations made 
in the complaint.  Watts v. Watts, 137 Wis. 2d 506, 512, 405 
N.W.2d 303 (1987).  Judicial notice may also be taken of facts 
from the public records of government agencies, here the PTO and 
the FDA.  See Perkins v. State, 61 Wis. 2d 341, 346, 212 N.W.2d 
141 (1973) (concluding that a court may take judicial notice of 
facts easily accessible and capable of immediate and accurate 
determination); Wis. Power & Light Co. v. City of Beloit, 215 
Wis. 439, 444, 254 N.W. 119 (1934) (taking judicial notice of 
the files of the public service commission); Hillier v. Lake 
View Mem'l Park, Inc., 208 Wis. 614, 622, 243 N.W. 406 (1932) 
(taking judicial notice of incorporation records in the office 
of secretary of state).7  However, on a motion to dismiss, courts 
do not accept "facts which the court will take judicial notice 
                                                 
7 For a detailed exposition of judicial notice of facts by 
appellate courts see George R. Currie, Appellate Courts Use of 
Facts Outside of the Record by Resort to Judicial Notice and 
Independent Investigation, 1960 Wis. L. Rev. 39 (1960). 
No.  2003AP2840.pdr 
 
7 
 
are not true, nor does the rule [of accepting facts pled in the 
complaint] apply to legally impossible facts."  Cohen v. United 
States, 129 F.2d 733, 736 (8th Cir. 1942).  We also are not 
required to accept factual statements that are not credible.  
See Ferraro v. Koelsch, 119 Wis. 2d 407, 410-11, 350 N.W.2d 735 
(Ct. App. 1984).  Furthermore, we are not required to accept 
legal conclusions pled in the complaint.  John BBB Doe v. 
Archdiocese of Milwaukee, 211 Wis. 2d 312, 331, 565 N.W.2d 94 
(1997).   
¶82 We interpret the application of statutes independently 
of the court of appeals and the circuit court, but benefiting 
from the analyses of both prior decisions.  Spiegelberg v. 
State, 2006 WI 75, ¶8, 291 Wis. 2d 601, 717 N.W.2d 641.  And 
finally, whether a legal doctrine can shield defendants from 
liability under Wisconsin's antitrust law that would otherwise 
be accorded to the complained of conduct is a question of law.  
Prentice, 176 Wis. 2d at 721. 
B. 
Wisconsin Antitrust Claim 
¶83 There 
have 
been 
approximately 
30 
cases 
filed 
throughout the United States, in state and federal courts, that 
make antitrust claims against Bayer and Barr based on the same 
Bayer-Barr agreement that is at issue here.  Meyers v. Bayer AG, 
143 F. Supp. 2d 1044, 1046 (E.D. Wis. 2001).  Many of those 
cases have been consolidated in the Eastern District of New York 
under the scholarly attention of District Court Judge David 
Trager.  See In re Ciprofloxacin Hydrochloride Antitrust Litig., 
363 F. Supp. 2d 514 (E.D.N.Y. 2005).   
No.  2003AP2840.pdr 
 
8 
 
¶84 The case now before us was filed in state court, 
removed to federal court and remanded to state court because the 
federal district court determined that mounting a patent defense 
to a state antitrust claim did not cause the matter "to arise 
under" federal law.  Meyers, 143 F. Supp. 2d at 1051.  The 
federal district court did not analyze whether a state claim had 
been stated without plaintiffs alleging that Bayer's Cipro 
patent was invalid.  In addition, the district court did not 
address whether the conduct alleged in the complaint exceeded 
Bayer's rights under its Cipro patent. 
1. 
General patent law principles 
¶85 In order to adequately address the defendants' motion 
to dismiss the complaint, there are certain general principles 
of federal patent law that must be recognized.  That recognition 
is necessary before a court can evaluate a complaint wherein a 
patent owner is sued, in order to sort out which allegations are 
factual allegations of a type that must be accepted for purposes 
of a motion to dismiss, which allegations contain facts not 
accepted as true, and which allegations are actually legal 
conclusions. 
¶86 A civil state court claim against a patent owner, such 
as Bayer, that alleges conduct relating to the patented 
invention and requests damages, must assume that the patent is 
valid and it must allege conduct that falls outside of the 
rights accorded under the patent.  This is so because if the 
complaint were to allege that the patent is invalid, there would 
be no subject matter jurisdiction in Wisconsin state courts to 
No.  2003AP2840.pdr 
 
9 
 
hear the claim.  28 U.S.C. § 1338(a);8 Schecher v. Purdue Pharma 
L.P., 317 F. Supp. 2d 1253, 1257 (D. Kan. 2004);9 see also Vill. 
of Trempealeau v. Mikrut, 2004 WI 79, ¶8 n.2, 273 Wis. 2d 76, 
681 N.W.2d 190.10  And, if all the conduct that is alleged falls 
within the rights granted by the federal government to the 
patentee, the conduct is not illegal nor is its effect illegal.  
United States v. General Elec. Co., 272 U.S. 476, 489-90 (1926).  
It is important to continue to note that only illegal conduct or 
conduct that has an illegal effect violates Wis. Stat. § 133.03.  
Olstad, 284 Wis. 2d 224, ¶85; Prentice, 176 Wis. 2d at 721.   
¶87 Antitrust 
law 
generally 
forbids 
agreements 
that 
restrict output and raise prices above that which would be 
achieved in normal market competition.  See Phillip Areeda & 
Herbert Hovenkamp, Vol. X Antitrust Law:  An Analysis of 
Antitrust Principles and Their Application, ¶1780a (2d ed. 
2004).  However, if a patent owner acts solely within the rights 
                                                 
8 28 U.S.C. § 1338(a) provides, "The districts courts shall 
have original jurisdiction of any civil action arising under any 
Act of Congress relating to patents . . . .  Such jurisdiction 
shall be exclusive of the courts of the states." 
9 [D]istrict courts have exclusive original jurisdiction 
over actions "arising under" federal patent laws, i.e., in an 
action challenging the validity or enforceability of the patent.  
Schecher v. Purdue Pharma L.P., 317 F. Supp. 2d 1253, 1257 (D. 
Kan. 2004).   
10 Village of Trempealeau v. Mikrut, 2004 WI 79, 273 Wis. 2d 
76, 681 N.W.2d 190, explains that as a general proposition, 
circuit courts have broad subject matter jurisdiction; however, 
"[f]ederal law may confer exclusive jurisdiction over certain 
subject matters to the federal courts, precluding state court 
jurisdiction in those areas by operation of the Supremacy 
Clause."  Id., ¶8 n.2. 
No.  2003AP2840.pdr 
 
10 
 
granted under the patent, the patent owner has a lawful monopoly 
and is "freed from competition of price, service, quality or 
otherwise."  United States v. Line Material Co., 333 U.S. 287, 
300 (1948).   
¶88 As the United States Supreme Court has explained:   
"A patent by its very nature is affected with a public 
interest . . .  [It] is an exception to the general 
rule against monopolies and to the right to access to 
a free and open market."   
Walker Process Equip., Inc. v. Food Mach. & Chem. Corp., 382 
U.S. 172, 177 (1965) (quoting Precision Instrument Mfg. Co. v. 
Auto. Maint. Mach. Co., 324 U.S. 806, 816 (1945)).  It is black 
letter law that a patent "is an exception to the general rule 
against monopolies."  Ciprofloxacin, 363 F. Supp. 2d at 523 
(quoting Precision, 324 U.S. at 816).   
¶89 Therefore, agreeing to operate as a monopoly that 
fixes price for a patented invention is not illegal because 
monopoly rights exercised within the confines of the patent are 
granted by the federal government with the patent.  As the 
United States Supreme Court has explained:  
[T]he general rule is absolute freedom in the use or 
sale of rights under the patent laws of the United 
States.  The very object of these laws is monopoly, 
and the rule is, with few exceptions, that any 
conditions which are not in their very nature illegal 
with regard to this kind of property, imposed by the 
patentee and agreed to by the licensee for the right 
to manufacture or use or sell the article, will be 
upheld by the courts.  The fact that the conditions in 
the contracts keep up the monopoly or fix prices does 
not render them illegal.  
Bement, 186 U.S. at 91 (emphasis added).  In support of this 
monopoly, the federal law grants to a patent owner "the right to 
No.  2003AP2840.pdr 
 
11 
 
exclude others from making, using, offering for sale, or selling 
the invention throughout the United States or importing the 
invention into the United States."  35 U.S.C. § 154(a)(1).  The 
"essence of a patent grant is the right to exclude others from 
profiting by the patented invention."  Dawson Chem. Co. v. Rohm 
& Haas Co., 448 U.S. 176, 215 (1980).  The rationale for 
granting such monopolies to patent owners is to encourage 
inventions.  Brenner v. Manson, 383 U.S. 519, 534 (1966).11 
¶90 The monopoly rights accorded to a patent owner also 
include the right to control the price charged for the patented 
invention by a licensee of the patent owner.  General Elec., 272 
U.S. at 489-90.  In General Electric, the government alleged 
that General Electric was engaged in illegal price-fixing of 
lamps through an agreement with Westinghouse.  Id. at 478.  
General 
Electric 
owned 
the 
patents 
necessary 
for 
the 
construction of certain tungsten filament lamps.  Id. at 480-81.  
Westinghouse was one of General Electric's licensees to sell the 
lamps as part of a nationwide sales and distribution plan.  Id. 
at 481-82.  In considering the government's allegation that 
General 
Electric 
imposed 
a 
price-fixing 
condition 
on 
Westinghouse's sales, the Court concluded price-fixing on sales 
                                                 
11 The freedom to take actions within the rights granted to 
a 
patent 
owner that would otherwise be unlawful has a 
limitation.  If the patent was obtained "by knowing and willful 
fraud practiced by the defendant on the Patent Office or, if the 
defendant was not the original patent applicant, [but] he had 
been enforcing the patent with knowledge of the fraudulent 
manner in which it was obtained," the patent will provide no 
shield to claims of unlawful anticompetitive conduct.  Walker 
Process Equip., Inc. v. Food Mach. & Chem. Corp., 382 U.S. 172, 
179 (1965) (Harlan, J., concurring). 
No.  2003AP2840.pdr 
 
12 
 
by a licensee was permissible so long as the price-fixing 
stopped with the licensee and did not continue to fix the prices 
charged by those who purchased from the licensee for subsequent 
sale.  Id. at 485.  The court explained: 
[U]nder the patent law the patentee is given by 
statute a monopoly of making, using and selling the 
patented article.  The extent of his monopoly in the 
articles sold and in the territory of the United 
States where sold is not limited in the grant of his 
patent, and the comprehensiveness of his control of 
the business in the sale of the patented article is 
not necessarily an indication of illegality of his 
method.  As long as he makes no effort to fasten upon 
ownership of the articles he sells control of the 
prices at which his purchaser shall sell, it makes no 
difference how widespread his monopoly.  It is only 
when he adopts a combination with others, by which he 
steps out of the scope of his patent rights and seeks 
to control and restrain those to whom he has sold his 
patented articles in their subsequent disposition of 
what is theirs, that he comes within the operation of 
the Anti-Trust Act.  
Id.   
¶91 Therefore, as we examine the complaint, we must:  (1) 
presume Bayer's Cipro patent is valid because the plaintiffs 
claims are before a Wisconsin state court; and (2) assess 
whether any factual allegation relating to the Bayer-Barr 
agreement falls outside Bayer's right to maintain a monopoly on 
the price Bayer or its licensee charges for Cipro.  With these 
general principles of patent law in mind, I turn to Wisconsin 
antitrust law.   
2. 
State antitrust principles 
¶92 Wisconsin's antitrust law is set out in ch. 133 of the 
Wisconsin Statutes.  The operative provision at issue in the 
No.  2003AP2840.pdr 
 
13 
 
case before us is Wis. Stat. § 133.03.  It provides in relevant 
part: 
Unlawful contracts; conspiracies.  (1)  Every 
contract, 
combination 
in 
the 
form 
of 
trust 
or 
otherwise, or conspiracy, in restraint of trade or 
commerce is illegal.  . . .  
(2) Every person who monopolizes, or attempts to 
monopolize, or combines or conspires with any other 
person or persons to monopolize any part of trade or 
commerce is guilty. 
¶93 Wisconsin antitrust law follows federal antitrust law 
in most respects.  State v. Waste Mgmt. of Wis., Inc., 81 
Wis. 2d 555, 568-69, 261 N.W.2d 147 (1978).  For example, both 
federal and state laws prohibit conspiracies to restrain trade 
and monopolies of the market.  15 U.S.C. §§ 1, 4, 15; Wis. Stat. 
§ 133.03.  However, Wisconsin antitrust law differs from federal 
antitrust law in that Wisconsin law may permit the recovery of 
damages 
by 
"indirect 
purchasers"12 
alleging 
unlawful 
anticompetitive conduct, Olstad, 284 Wis. 2d 224, ¶63, but 
federal law does not.  Ill. Brick Co. v. Illinois, 431 U.S. 720, 
730-31 (Ill. 1977).   
¶94 The most recent Wisconsin Supreme Court decision 
interpreting Wis. Stat. § 133.03 is Olstad.  There we addressed 
the certified question:  "Does Wisconsin's antitrust act, Wis. 
Stat. § 133.03, apply to interstate commerce affecting Wisconsin 
commerce?"  Olstad, 284 Wis. 2d 224, ¶10.  Olstad claimed that 
                                                 
12 The plaintiffs in the case before us are all "indirect 
purchasers" of Cipro because they did not purchase Cipro 
directly from Bayer or Barr.  Ill. Brick Co. v. Illinois, 431 
U.S. 720, 726 (Ill. 1977).  
No.  2003AP2840.pdr 
 
14 
 
Microsoft's share of the market for personal computer operating 
systems was so large that it prevented others from entering the 
market. 
 
Id., 
¶¶2-3. 
 
Olstad 
alleged 
that 
Microsoft's 
anticompetitive conduct caused Wisconsin consumers to pay higher 
prices.  Id., ¶7.  The circuit court dismissed the action after 
concluding that § 133.03 did not apply to interstate conduct.  
Id., ¶9.   
¶95 We concluded that "at least in some circumstances" 
Wis. Stat. § 133.03 does apply to interstate conduct.  Id., ¶74.  
Our limited conclusion was based in large part on our prior 
holding in Allied Chemical & Dye, where we addressed whether 
Wisconsin could apply its antitrust law to the sales of calcium 
chloride made in Wisconsin through interstate commerce when 
those sales were subject to the federal antitrust law.  Allied 
Chem. & Dye, 9 Wis. 2d at 292.  We concluded that Wisconsin law 
could be applied in some circumstances, in part because there 
was no conflict between federal and state antitrust laws.  Id. 
at 295.   
¶96 In Olstad, we also set out a test to assist courts and 
the public ascertain when Wis. Stat. § 133.03 may reach 
interstate actions.  As a very general framework, we explained 
that either:  (1) "actionable conduct, such as the formation of 
a 
combination 
or 
conspiracy," 
must 
have 
occurred 
within 
Wisconsin, 
or 
(2) 
if 
the 
actionable 
conduct 
occurred 
predominantly or exclusively outside of Wisconsin, the "illegal 
activity" must "substantially affect" the people of Wisconsin 
and have "impacts" in Wisconsin.  Olstad, 284 Wis. 2d 224, ¶85.  
No.  2003AP2840.pdr 
 
15 
 
We advised that the test was to be interpreted in a restrictive 
fashion so that Wisconsin's antitrust law would be available on 
only a limited basis with regard to interstate conduct:   
Operating with lesser standards would jeopardize the 
action, undermine the validity of our antitrust 
statute, and create the spectacle of Lilliputian 
harassment 
in 
Wisconsin 
courts. 
 
Questions 
of 
provincialism, 
favoritism, 
and 
undue 
burden 
on 
interstate commerce should be determined by resort to 
contemporary federal commerce clause jurisprudence. 
Id.   
¶97 It is important to note that Olstad does not address 
any issue that may arise in the application of state antitrust 
law in the context of a federal patentee's actions, where 
federal law may effect whether state law will be applied.  
Furthermore, in Olstad, we also did not address whether an 
indirect purchaser's claim based on conduct that occurred solely 
outside of Wisconsin should be subject to Wisconsin's antitrust 
law because that question was not brought to us for decision.   
¶98 However, 
we 
have 
in 
past 
decisions 
shown 
that 
Wisconsin antitrust law will not be applied to each and every 
occasion where the claim of a state law violation is made.  In 
State v. Milwaukee Braves, Inc., 31 Wis. 2d 699, 144 N.W.2d 1 
(1966), we carefully considered the lack of federal prosecution 
of interstate conduct and what impact that should have on our 
decision about the prosecution of an antitrust claim under 
Wisconsin law.   
¶99 Milwaukee Braves involved a state antitrust action 
brought against the Braves and others by the State, due to major 
league baseball's decision to move the club to Atlanta, while 
No.  2003AP2840.pdr 
 
16 
 
refusing to permit another major league baseball team to locate 
in Milwaukee.  Id. at 703-04.  We acknowledged that a 
"substantial injury to business activity within Wisconsin" was 
caused by the exercise of major league baseball's monopoly 
power.  Id. at 719.  We explained that "organized baseball is 
interstate commerce and Congress may therefore regulate it."  
Id. at 720.  However, we noted that major league baseball had 
not been subjected to prosecution under federal antitrust law.  
Id. at 721.   
¶100 When 
considering 
how 
to 
determine 
whether 
that 
de facto exemption from federal antitrust law could cause a 
conflict with the application of state antitrust law in regard 
to the decision to move the Braves, we framed the question as:  
"whether there is a conflict between state and federal policy, 
so that the state policy must yield."  Id.  We concluded that 
federal choice must control and Wisconsin could not enforce its 
antitrust law based on the "concerted action" of moving the 
Braves from Milwaukee and refusing Milwaukee another major 
league baseball franchise.  Id. at 732.   
¶101  In 
Prentice, 
we 
once 
again 
addressed 
whether 
prosecution of alleged conduct, which if proved true, appeared 
to violate Wisconsin antitrust law, should proceed.  Prentice 
was brought as a class action against "twelve title insurance 
companies and several of their employees."  Prentice, 176 
Wis. 2d at 720.  It was claimed that the defendants engaged in a 
conspiracy to restrain trade, causing the consumer "plaintiffs 
to pay substantially higher prices for title insurance and 
No.  2003AP2840.pdr 
 
17 
 
related services than they would have had to pay in the absence 
of the alleged conspiracy."  Id.  At issue was "whether the 
filed rate doctrine shield[ed] the defendants from liability" 
under Wisconsin's antitrust law.  Id. at 721.   
¶102 In Prentice, we explained how a regulatory agency's 
approval of a rate "established the lawfulness" of a rate; and 
therefore, the "legal rights of the parties were measured solely 
by the filed rate."  Id. at 722.  We concluded that because the 
insurance companies filed the rates they would charge pursuant 
to the provisions of Wis. Stat. § 625.15(2) (1977-78) and the 
agency had approved those rates under the filed rate doctrine, 
the rates charged were lawful rates.  Id. at 725.  Therefore, 
the title insurance companies and their employees were not 
subject to prosecution under Wisconsin antitrust law.  Id.  This 
discussion demonstrates that while Wisconsin's antitrust law may 
initially appear to be applicable, there are occasions when it 
will not be applied because to do so would interfere with other 
federal or state laws or doctrines. 
3. 
Plaintiffs' claims 
¶103 I now turn to the plaintiffs' claims in the suit 
before us.  The complaint acknowledges that Bayer is the holder 
of the patent for Cipro.  It alleges that Barr's generic drug is 
the "bioequivalence" of Cipro.   
¶104 Plaintiffs' allegation of the existence of Bayer's 
Cipro patent is significant because all patents are presumed to 
be valid.  35 U.S.C. § 282.  Furthermore, Bayer's patent for 
Cipro has been adjudged valid and enforceable.  Bayer AG v. Barr 
No.  2003AP2840.pdr 
 
18 
 
Labs., No. 92CV391 (S.D.N.Y. Jan. 16, 1997).  And finally, if 
the plaintiffs were attacking the validity or enforceability of 
the patent through the allegations that are made in the 
complaint, there would be no subject matter jurisdiction in 
Wisconsin courts to hear their claims.  Schecher, 317 F. Supp. 
2d at 1257. 
¶105 Plaintiffs nonetheless allege that in the absence of 
the Bayer-Barr agreement, Barr would have begun marketing 
generic Cipro January 6, 1995.13  This can be true under only one 
condition for a claim made in state court——the monopoly set out 
in the Bayer-Barr agreement must fall outside of Bayer's right 
to maintain a monopoly for Cipro throughout the term of the 
patent.  Ciprofloxacin, 363 F. Supp. 2d at 524.  Stated 
otherwise, "the conduct at issue is illegal if it threatens 
competition in areas other than those protected by the patent 
and [if not, it] is otherwise legal."  Id. (quoting United 
States v. Studiengesellschaft Kohle, m.b.H., 670 F.2d 1122, 1127 
(D.C. Cir. 1981)).  Therefore, while not every monopoly that an 
owner of a patent maintains is lawful, in order to withstand a 
motion to dismiss, a complaint against a patent owner must 
allege some conduct, which if proved true, falls outside of the 
                                                 
13 This date predates FDA final approval to Barr, which 
according to the FDA's public records occurred on June 9, 2004.  
No.  2003AP2840.pdr 
 
19 
 
conduct protected under the patent during the entire term of the 
patent.14   
¶106 I accept the following allegations of plaintiffs as 
true for purposes of this motion:  (1) The Bayer-Barr agreement 
consented to "fix, raise, maintain, and stabilize the price of 
Cipro."  (2) The Bayer-Barr agreement "provides that Bayer has 
the option to either: (a) license and supply Bayer-manufactured 
Cipro to Barr [] for resale under a generic label; or (b) pay 
quarterly amounts to Barr from 1998 through at least 2003."  (3) 
The Bayer-Barr agreement "set forth the prices that Bayer may 
charge to Barr [], if Bayer chooses to supply its Cipro to Barr 
[] for resale [and] requires Barr [] to share with Bayer in 
profits 
from 
the 
resale 
of 
generically 
labeled 
Cipro 
manufactured by Bayer [and] [] limits the ability of Barr [] to 
price Cipro licensed from Bayer independently."   
¶107 None of these allegations is sufficient to state a 
claim under Wis. Stat. § 133.03 because none of the alleged 
conduct is illegal and the monopolistic effect of the conduct is 
not illegal.  The price-fixing conduct and the monopoly that is 
                                                 
14 For example, while one who owns a patent can price-fix 
for the patented invention to those to whom it or its licensees 
sell, it cannot lawfully fix the price for the patented 
invention that will be charged by those to whom the patent owner 
or its licensees have sold.  General Elec., 272 U.S. at 485.  In 
addition, a licensee who has rights under a former provision in 
the Hatch-Waxman Act to act as the first generic producer for 
180 
days 
on 
the 
expiration 
of 
the 
patent 
(21 
U.S.C. 
§ 355(j)(5)(B)(iv)) 
cannot 
lawfully 
agree 
to 
delay 
the 
commencement of the 180-day period and in so doing, extend the 
patent beyond the term granted by the PTO.  In re Cardizem CK 
Antitrust Litig., 332 F.3d 896, 907-08 (6th Cir. 2003).   
No.  2003AP2840.pdr 
 
20 
 
alleged to have resulted come within the rights granted to Bayer 
by the federal government when it issued the Cipro patent.  
General Elec., 272 U.S. at 485; Bement, 186 U.S. at 91. 
¶108 There are other allegations in the complaint that 
appear factual, but are either legal conclusions that I do not 
accept for purposes of a motion to dismiss, John BBB Doe, 211 
Wis. 2d at 331, or they are facts for which I take judicial 
notice that they are not true or are not legally possible.  
Cohen, 129 F.2d at 736.  For example, we need not accept the 
allegation, repeated in many forms in the complaint, that were 
it not for the Bayer-Barr agreement, Barr would have begun to 
manufacture and market generic Cipro in January of 1995.   
¶109 According to the public records of the PTO, Bayer's 
original patent for Cipro did not expire until December 2003 and 
was extended through June 8, 2004.  Furthermore, Barr had 
received only "tentative" FDA approval in January of 1995.  The 
public records of the FDA show Barr did not have FDA approval to 
market generic Cipro until June 9, 2004.  Therefore, unless 
Bayer's Cipro patent is invalid——a position that the plaintiffs 
cannot maintain in this lawsuit in state court——it would have 
been a violation of federal law for Barr to market generic Cipro 
before June 9, 2004.  Therefore, in the context of a motion to 
dismiss, plaintiffs' repeated allegation in this regard does not 
cause their complaint to state a claim.   
¶110 The majority permits plaintiffs' claims to proceed 
because plaintiffs allege: 
a broad price-fixing scheme affecting "at minimum, 
thousands . . . in Wisconsin" who purchased the best-
No.  2003AP2840.pdr 
 
21 
 
selling antibiotic Cipro "at any time since January 6, 
1995."  We conclude Meyers' complaint alleges illegal 
conduct that, if true, substantially affected the 
people of Wisconsin and had impacts in this state. 
Majority op., ¶4.  The quote above shows that the majority 
opinion errs because it does not consider the context in which 
the complaint is made, i.e., it is made against the lawful owner 
of the federal patent for Cipro.  Bayer AG v. Barr Labs., No. 
92CV391 (S.D.N.Y. Jan. 16, 1997) (concluding that Bayer owns the 
Cipro patent, which is valid and enforceable).15     
¶111 The majority opinion gives credence to the complaint's 
assertion that "as a result of the Agreement, Bayer maintained 
its monopoly of the United States market for Cipro and generic 
equivalents of Cipro."  Majority op., ¶13.  The quoted phrase, 
"as a result of the Agreement" from the majority opinion 
incorporates a conclusion of law.  It does not recite a fact 
because the Bayer-Barr agreement could have caused Bayer to have 
a monopoly for Cipro only if Bayer's Cipro patent were invalid.  
General Elec., 272 U.S. at 485; Bement, 186 U.S. at 91.  
Otherwise, the monopoly is a result of the patent.  Throughout 
the majority opinion it assumes the alleged conduct is illegal.  
This is a conclusion of law inappropriate for a motion to 
dismiss, unless there are facts alleged, which if true, were 
                                                 
15 That the plaintiffs' claim is made against the patent 
owner for Cipro was argued to the circuit court.  It was not 
briefed for us because the circuit court dismissed the complaint 
on other grounds and the court of appeals reviewed only the 
grounds employed by the circuit court.  However, many questions 
about the effect of Bayer's Cipro patent on the plaintiffs' 
claims were asked of counsel for all parties at the oral 
argument before us. 
No.  2003AP2840.pdr 
 
22 
 
sufficient to support that conclusion.  No such facts have been 
alleged in the complaint.  And, as I explained above, price-
fixing and monopolies within the rights granted with the Cipro 
patent are legal.  Bement, 186 U.S. at 91 (explaining that 
"[t]he fact that the conditions in the contracts keep up the 
monopoly or fix prices does not render them illegal"). 
¶112 Only illegal conduct or conduct that has an illegal 
effect violates Wisconsin's antitrust law.  Prentice, 176 
Wis. 2d at 721; Allied Chem., 9 Wis. 2d at 296.  Therefore, it 
is not just that price-fixing occurred and that it had a 
monopolistic effect, the price-fixing to attain a monopoly for 
Cipro must be illegal or the effect of the conduct must be 
illegal.  The allegations of both the conduct and its effect set 
out in the complaint are not illegal under controlling federal 
law.  General Elec., 272 U.S. at 485.  
¶113 Furthermore, under Wis. Stat. § 133.03, only illegal 
conduct or conduct that has an illegal effect can "substantially 
affect" the people of Wisconsin and have "impacts" that violate 
Wisconsin antitrust law.  Olstad, 284 Wis. 2d 224, ¶85; Allied 
Chem., 9 Wis. 2d at 295.  It is beyond question that not all 
price-fixing or monopolies are illegal.  In the case before us, 
given the presumption that Bayer's Cipro patent is valid and 
enforceable, none of the conduct alleged is illegal, nor is the 
monopolistic effect of the conduct illegal.  General Elec., 272 
U.S. at 485; Bement, 186 U.S. at 91.  Therefore, because of the 
nature of a patent, any adverse effects on the market that were 
caused by actions that fall within the scope of a patent owner's 
No.  2003AP2840.pdr 
 
23 
 
rights under the patent cannot be addressed by antitrust law.  
Ciprofloxacin, 363 F. Supp. 2d at 524; see also Prentice, 176 
Wis. 2d at 721.  Only conduct that threatens competition in 
areas other than those that are protected by the rights under a 
patent 
can 
be 
illegal 
under 
federal 
antitrust 
law.  
Ciprofloxacin, 363 F. Supp. 2d at 524.  No such conduct has been 
alleged in the complaint before us.  Therefore, defendant's 
motion to dismiss should be granted. 
III.  CONCLUSION 
¶114 Because the conduct alleged in the complaint is not 
illegal or alleged to have had an illegal effect, it cannot 
"substantially 
affect" 
the 
people 
in 
Wisconsin 
and 
have 
"impacts" in Wisconsin contrary to Wis. Stat. § 133.03.  Olstad, 
284 Wis. 2d 224, ¶85.  Therefore, I would affirm the circuit 
court's dismissal of the complaint for failure to state a claim 
pursuant to Wis. Stat. § 802.06(2)(a)6, albeit on different 
grounds.  Accordingly, I respectfully dissent. 
¶115 I am authorized to state that Justices JON P. WILCOX 
and DAVID T. PROSSER join this dissent. 
 
 
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