Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_04-cv-01511/USCOURTS-cand-4_04-cv-01511-16/pdf.json

Nature of Suit Code: 410
Nature of Suit: Antitrust
Cause of Action: 28:1331 Fed. Question: Anti-trust

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United States District Court

For the Northern District of California

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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

IN RE ABBOTT LABORATORIES NORVIR

ANTI-TRUST LITIGATION

 /

No. C 04-1511 CW

(Consolidated Case)

No. C 04-4203 CW

ORDER GRANTING IN

PART PLAINTIFFS'

MOTION FOR CLASS

CERTIFICATION

Plaintiffs John Doe 1, John Doe 2 and the Service Employees

International Union Health and Welfare Fund (SEIU) move pursuant to

Federal Rule of Civil Procedure 23 for certification of a class. 

Defendant Abbott Laboratories opposes the motion. The matter was

heard on April 13, 2007. Having considered the parties’ papers and

oral arguments, the Court grants in part Plaintiffs' motion for

class certification.

BACKGROUND

Protease inhibitors (PIs) are considered the most potent class

of drugs to combat HIV. In 1996, Defendant introduced Norvir as a

stand-alone PI. After Norvir’s release, it was discovered that,

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when used in a low dose with another PI, Norvir would “boost” the

anti-viral properties of that PI. 

In 2000, Defendant introduced Kaletra, a pill containing the

protease inhibitor lopinavir and Norvir. Although effective and

widely used, Kaletra had significant side effects for some

patients. Studies showed that two new PIs, however, when boosted

with Norvir, were as effective as Kaletra, and were more

convenient. After these PIs were introduced, Kaletra’s market

share fell more than Defendant anticipated. 

On December 3, 2003, after the release of these two new PIs,

Defendant raised by 400 percent the wholesale price of Norvir; it

did not raise the price of Kaletra. Defendant contends that it

raised Norvir’s price so that it would be more in line with the

drug’s enormous clinical value. Plaintiffs contend that the Norvir

price increase was an illegal attempt to achieve an anticompetitive purpose in the “boosted market,” which Plaintiffs

define as the market for those PIs, such as Reyataz, Lexiva and

Kaletra, that are prescribed for use with Norvir as a booster. 

Plaintiffs sued Defendant, alleging violations of section 2 of the

Sherman Act and California Business and Professions Code section

17200 and unjust enrichment. 

Plaintiffs now seek to certify the following class: All

persons or entities throughout the United States and its

territories who purchased or paid for, or who reimbursed another

person or entity who purchased or paid for, Norvir as a booster to

other protease inhibitors intended for consumption by themselves,

their families, or their members, employees, plan participants and

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beneficiaries or insureds, and who paid all or part of the cost of

Norvir ("the Class") during the period December 3, 2003 through

such time in the future as the effects of Defendant's illegal

conduct, as alleged, have ceased ("the Class Period"). Excluded

from the Class are Defendant and its respective subsidiaries and

affiliates, all government entities (except for government-funded

employee benefits funds), and all persons or entities that purchase

Norvir: (i) for purposes of resale, or (ii) directly from

Defendant. Plaintiffs further move the Court to appoint themselves

as class representatives and to appoint Labaton Sucharow & Rudoff

LLP and Berman DeValerio Pease Tabacco Burt & Pucillo as co-lead

class counsel.

Defendant opposes the motion for class certification, arguing

that the Individual Doe Plaintiffs are not members of the proposed

class and, therefore, are not proper class representatives. It

further argues that none of the named Plaintiffs is a proper class

representative for the Sherman Act claim or for the California

state law unfair competition claim, and that certification of the

unjust enrichment claim is not appropriate because of the varying

laws of fifty States and the predominance of individual issues. 

DISCUSSION

I. Legal Standard for Class Certification

Plaintiffs seeking to represent a class must satisfy the

threshold requirements of Rule 23(a) as well as the requirements

for certification under one of the subsections of Rule 23(b). See

Fed. R. Civ. P. 23. The party seeking class certification bears

the burden of demonstrating that each element of Rule 23 is

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satisfied. Doninger v. Pacific Northwest Bell, Inc., 564 F.2d

1304, 1308 (9th Cir. 1977). 

A district court may certify a class only if, after "rigorous

analysis," it determines that the party seeking certification has

borne its burden. General Tel. Co. v. Falcon, 457 U.S. 147, 158-61

(1982). In determining whether the plaintiffs have carried their

burden, the court may not consider the merits of the plaintiffs'

claims. Burkhalter Travel Agency v. MacFarms Intern., Inc., 141

F.R.D. 144, 152 (N.D. Cal. 1991). Rather, the court must take the

substantive allegations of the complaint as true. Blackie v.

Barrack, 524 F.2d 891, 901 (9th Cir. 1975). Nevertheless, the

court need not accept conclusory or generic allegations regarding

the suitability of the litigation for resolution through class

action. Burkhalter, 141 F.R.D. at 152. And the court may consider

supplemental evidentiary submissions of the parties. In re

Methionine Antitrust Litig., 204 F.R.D. 161, 163 (N.D. Cal. 2001);

see also Moore v. Hughes Helicopters, Inc., 708 F.2d 475, 480 (9th

Cir. 1983) (noting that “some inquiry into the substance of a case

may be necessary to ascertain satisfaction of the commonality and

typicality requirements of Rule 23(a)”; however, “it is improper to

advance a decision on the merits at the class certification

stage”). Ultimately, it is in the district court's discretion

whether a class should be certified. Burkhalter, 141 F.R.D. at

152. 

I. Class Membership and Standing

Implicit in Rule 23 is the requirement that the class

representatives be members of the class. Westways World Travel,

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Inc. v. AMR Corp., 218 F.R.D. 223, 230 (C.D. Cal. 2003); see also

General Tel., 457 U.S. at 156 (holding that “a class representative

must be part of the class and possess the same interest and suffer

the same injury as the class members”). Further, standing “is a

jurisdictional element that must be satisfied prior to class

certification.” Nelsen v. King County, 895 F.2d 1248, 1249-50 (9th

Cir. 1990). As the Eleventh Circuit explains, it is “well-settled

that prior to the certification of a class, and technically

speaking before undertaking any formal typicality or commonality

review, the district court must determine that at least one named

class representative has Article III standing to raise each class

subclaim.” Wooden v. Bd. of Regents of Univ. Sys. of Georgia, 247

F.3d 1262, 1287-88 (11th Cir. 2001). 

A. Class Membership 

Defendant does not dispute that Plaintiff SEIU is a member of

the proposed class, but it argues that neither of the Doe

Plaintiffs are class members. To qualify as a class

representative, a plaintiff must be “part of the class and possess

the same interest and suffer the same injury as class members.” 

General Tel., 457 U.S. at 156. Defendant points out that Doe 1, at

all relevant times, and Doe 2, since June, 2004, paid flat copayments for each of their prescription drugs, including Norvir,

and, thus, never “paid all or part of the increased cost of

Norvir.” After the hearing on class certification, however,

Plaintiffs revised their class definition and deleted the word

"increased." 

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Defendant further points out that, during the proposed class

period, Doe 2 took 1,200 milligrams of Norvir a day. It contends

that 1,200 milligrams is a stand-alone dose and not a boosting dose

and, therefore, Doe 2 did not “pay for Norvir as a booster,” as

required for class membership. Defendant points to the testimony

of Plaintiff's expert Dr. Douglas Greer that “the patient who is

using Norvir not as a booster, but as a standalone PI, that -- that

would be a person not in the class.” Park Dec., Ex. A at 34:20-

22; see also id. at 35:22-36:1 (agreeing that a patient taking

Norvir at a 1,200 milligram daily dose, and not using Norvir as a

low dose booster, would not be a member of the class).

Plaintiffs respond that Doe 1 and Doe 2 are class members. In

support of their earlier class definition, they argued that, under

the collateral source rule, Doe 1 and Doe 2 are entitled to recover

the amount of the Norvir price hike paid by them and on their

behalf by their insurance companies and, therefore, Doe 1 and Doe 2

have legally cognizable injuries falling within the class

definition. As Plaintiffs note, courts have applied the collateral

source rule in anti-trust class actions involving prescription

drugs. For example, in In re Warfarin Sodium Antitrust Litigation,

212 F.R.D. 231 (D. Del. 2002), the court approved a proposed

settlement in a class action filed by consumers and third-party

payors who paid all or some of the purchase price of a drug. The

court noted that some class members argued that the consumers who

paid a fixed co-payment had not suffered any damages, because they

paid the same for warfarin sodium regardless of whether it was a

brand name or generic version. 212 F.R.D. at 259. Although the

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court stated that “the argument has merit,” the court recognized

that fixed co-payment consumers “could sue defendant for damages by

invoking the ‘collateral source’ doctrine,” and did not exclude

those consumers from the class. Id.

Plaintiffs argue that this case is directly on point. It is

not. In determining that fixed co-payment consumers should be

allowed to share in the distribution of the settlement fund, the

court relied on numerous factors, including that “to exclude fixed

co-pay consumers now would require sending additional notice and a

new, more complicated claim form to the consumers who have already

filed claims” and “would further delay distribution to the rest of

the class and result in additional administrative costs.” 

Nonetheless, this case provides some support to Plaintiffs’

argument that, under the collateral doctrine rule, Doe 1 and Doe 2

are class members.

Goda v. Abbott Labs., 1997 WL 156541 (D.C. Super. Ct.),

provides additional support. There, the court found that, although

the parties cited no case dealing with collateral contributions in

the context of anti-trust injury, the rationale behind the

collateral damages rule applied, especially “where the wrong is not

mere negligence that usually harms only one person” but deliberate

actions that harm many. 1997 WL 156541 at *9. The court certified

a class that included consumers with fixed co-payments, so long as

those consumers did not have managed care programs “whose brandname-prescription-drug benefits are such that they negate any passon.” Id. By certifying the class, “[e]ffective enforcement of the

antitrust laws is thus promoted.” Id. Not noted by Plaintiffs,

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however, is that, in Goda, the court certified the class and

subclasses: the first subclass consisted of “consumers who are

without collateral source benefits”; the second consisted of “those

who have unexcluded collateral source benefits.” Id. at *10. 

Based on these cases, and the underlying policy regarding the

important role that class actions play in the enforcement of antitrust laws, the Court finds that Doe 1 and Doe 2 are not excluded

from class membership merely because, under their health care

plans, they paid a fixed co-payment for medication. See In re

Dynamic Random Access Memory Antitrust Litig., 2006 U.S. Dist.

LEXIS 39841 (N.D. Cal. 2006) (“Moreover, in antitrust actions such

as this one, it has long been recognized that class actions play an

important role in the private enforcement of antitrust laws. 

Accordingly, when courts are in doubt as to whether certification

is warranted, courts tend to favor class certification.”) (citation

omitted). Further, under Plaintiffs' revised class definition, a

class member need only pay all or part of the cost of Norvir. Doe

1 and Doe 2 meet that requirement. 

However, the Court finds that Doe 2 is excluded from class

membership because he did not use Norvir as a booster. Rather, he

consumed 1,200 milligrams of Norvir a day in combination with

Saquinavir. Although Plaintiffs state that this dosage was used to

“boost” the Saquinavir, they provide no evidence to support that

statement. Doe 2 states that his doctor prescribed him Norvir

along with the Saquinavir because they would interact, which would

make a “stronger combination.” As Defendant notes, this describes

a cocktail combination of PIs and not use of Norvir as a “booster.”

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1

Plaintiffs' claim for unjust enrichment is based on their

anti-trust injury; thus, if they have no standing to bring a claim

under the Sherman Act, their unjust enrichment claim fails.

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The Court finds that, like SEIU, Doe 1 is a member of the

proposed class; Doe 2, however, is not.

B. Standing

Defendant argues that none of the Plaintiffs has standing to

bring claims under California’s Unfair Competition Law or under the

Sherman Act and, thus, class certification is precluded.1

California's Unfair Competition Law "does not apply to actions

occurring outside of California that injure non-residents." 

Standfacts Credit Servs., Inc. v. Experian Info. Solutions, Inc.,

405 F. Supp. 2d 1141, 1148 (C.D. Cal. 2005); see also Norwest

Mortgage, Inc. v. Sup. Ct., 72 Cal. App. 4th 214, 226 (1999)

(refusing to apply California's Unfair Competition Law to "injuries

suffered by non-California residents, caused by conduct occurring

outside of California's borders by actors headquartered and

operating outside of California"). Plaintiffs make clear that this

claim is brought on behalf of class members who are or have been

California residents during the class period. Only one named

Plaintiff is a California resident: Doe 1. 

Defendant contends that, because Doe 1 is not a class member,

no named Plaintiff has standing to bring this claim. But, as

discussed above, the Court determines that Doe 1 is a class member.

Defendant further argues that Doe 1 does not have standing because 

California’s Unfair Competition Law requires that an unfair

competition claim must be brought by someone who "has suffered

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injury in fact and has lost money or property as a result of such

unfair competition." See Cal. Bus. & Prof. Code § 17204. The

section Defendant relies upon, however, concerns "Actions for

Injunctions by Attorney General, District Attorney, County Counsel,

and City Attorneys." Further, the Court finds that Doe 1 has

suffered an injury in fact and, therefore, he has standing to bring

a claim under California's Unfair Competition Law.

Defendant's arguments that Plaintiffs lack standing to bring

claims under the Sherman Act similarly fail. To have anti-trust

standing, a plaintiff must have an injury that "flows from an

anticompetitive aspect or effect of the defendant's behavior." 

Rebel Oil Co., Inc. v. Atlantic Richfield, 51 F.3d 1421, 1433 (9th

Cir. 1995). As Plaintiffs note, this Court has already considered

and rejected Defendant's argument that Plaintiffs claim no

cognizable anti-trust injury. See October 21, 2004 Order Denying

Defendant's Motion to Dismiss First Amended Class Action Complaint;

March 2, 2005 Order Denying Defendant's Motion to Dismiss. Indeed,

Defendant acknowledges that it raised these arguments before and

that, at that time, the Court was unwilling to rule, as a matter of

law, that SEIU was not a participant in the boosted market. The

Court is still unwilling to so rule. This is a motion for class

certification and “it is improper to advance a decision on the

merits to the class certification stage.” Moore, 708 F.2d at 480. 

Further, Defendant offers no good cause for the Court to reconsider

its prior decisions. Defendant asserts that considerable discovery

has been conducted which establishes SEIU's lack of involvement in

the Boosted Market, but it provides no support for that assertion

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and ignores the exception to the market participant requirement for

parties whose injuries are "inextricably intertwined" with the

injuries of market participants. See Blue Shield v. McCready, 457

U.S. 465 (1982); see also Ostrofe v. H.S. Crocker Co., 740 F.2d

739, 745-46 (9th Cir. 1984).

The Court concludes that Doe 1 has standing to bring claims

under California's Unfair Competition Law and that Doe 1 and SEIU

have standing to bring claims under the Sherman Act. The Court now

examines whether Plaintiffs meet the explicit requirements of Rule

23. 

II. Rule 23(a)

Rule 23(a) permits district courts to certify class actions

if: (1) the class is so numerous that joinder of all members is

impracticable (numerosity); (2) there are questions of law or fact

common to the class (commonality); (3) the claims or defenses of

the representative parties are typical of the claims or defenses of

the class (typicality); and (4) the representative parties will

fairly and adequately protect the interests of the class

(adequacy). See Fed. R. Civ. P. 23(a). 

A. Numerosity

“The prerequisite of numerosity is discharged if ‘the class is

so large that joinder of all members is impracticable.’” Hanlon v.

Chrysler Corp., 150 F.3d 1011, 1019 (9th Cir. 1998) (quoting Fed.

R. Civ. P. 23(a)(1)). Where "the exact size of the class is

unknown, but general knowledge and common sense indicate that it is

large, the numerosity requirement is satisfied." 1 Alba Cone &

Herbert B. Newberg, Newberg on Class Actions § 3.3 (4th ed. 2002). 

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Defendant does not deny the numerosity of the class and the Court

finds that this prerequisite is satisfied.

B. Commonality

“A class has sufficient commonality ‘if there are questions of

fact and law which are common to the class.’” Hanlon, 150 F.3d at

1019 (quoting Fed. R. Civ. P. 23(a)(2)). “All questions of fact

and law need not be common to satisfy this rule. The existence of

shared legal issues with divergent factual predicates is

sufficient, as is a common core of salient facts coupled with

disparate legal remedies within the class.” Id. Here, the claims

of all class members “stem from the same source,” id. at 1019-20,

namely, Defendant's alleged anti-competitive conduct in the pricing

of Norvir in order to obtain an unlawful advantage in the boosted

PI drug market. The Court finds that the allegations against

Defendant are sufficient to satisfy the commonality prerequisite of

Rule 23(a)(2).

C. Typicality

“The typicality prerequisite of Rule 23(a) is fulfilled if

‘the claims or defenses of the representative parties are typical

of the claims or defenses of the class.’” Id. at 1020 (quoting

Fed. R. Civ. P. 23(a)(3)). The test for typicality is "whether

other members have the same or similar injury, whether the action

is based on conduct which is not unique to the named plaintiffs,

and whether other class members have been injured by the same

course of conduct." Hanon v. Dataproducts Corp., 976 F.2d 497, 508

(9th Cir. 1992) (quoting Schwartz v. Harp, 108 F.R.D. 279, 282

(C.D. Cal. 1985)). “[R]epresentative claims are ‘typical’ if they

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are reasonably co-extensive with those of absent class members;

they need not be substantially identical.” Hanlon, 150 F.3d at

1020. However, "a named plaintiff's motion for class certification

should not be granted if 'there is a danger that absent class

members will suffer if their representative is preoccupied with

defenses unique to it.'" Hanon, 976 F.2d at 508 (quoting Gary

Plastic Packaging Corp. v. Merrill Lynch, 903 F.2d 176, 180 (2d

Cir. 1990)). 

Defendant's arguments that the named Plaintiffs' claims are

not typical because Doe 1 is not a class member and because all

Plaintiffs lack standing fail for the reasons discussed above. The

Court finds that the named Plaintiffs' claims and the absent class

members' claims arise out of the same alleged anti-trust

violations. The named Plaintiffs and the class members have

allegedly been injured by the same course of conduct. Therefore,

this prerequisite is also satisfied.

D. Adequacy

“The final hurdle interposed by Rule 23(a) is that ‘the

representative parties will fairly and adequately protect the

interests of the class.’” Hanlon, 150 F.3d at 1020 (quoting Fed.

R. Civ. P. 23(a)(4)). “Resolution of two questions determines

legal adequacy: (1) do the named plaintiffs and their counsel have

any conflicts of interest with other class members and (2) will the

named plaintiffs and their counsel prosecute the action vigorously

on behalf of the class?” Id. 

Defendant does not dispute that Plaintiffs' counsel will

prosecute this action vigorously on behalf of the class, but it

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argues that SEIU is not an adequate class representative because it

has inherently conflicting interests with individual class members. 

According to Defendant, SEIU and other third-party payors have an

interest in paying less and, thus, prefer that their members use

the lower-cost Kaletra, whereas the individual class members would

prefer using the higher-priced combination of Norvir plus a

competing PI. Defendant also contends that the possible remedies

for the anti-trust claim are antagonistic.

Plaintiffs respond with a supplemental declaration from their

expert, who opines that SEIU’s interests are the same as those of

the individual Plaintiffs and that possible remedies are not

antagonistic. They point to In re Warfarin Sodium Antitrust

Litigation, where the court rejected the argument “that the

interests of the class members were in conflict in such a way that

the District Court abused its discretion in certifying a single

class including several types of injured plaintiffs.” 391 F.3d at

532. That class included the named parties, both consumers and

third-party payors, who “all shared the same goal of establishing

the liability of [the defendant], suffered the same injury

resulting from the overpayment for warfarin sodium, and sought

essentially the same damages by way of compensation for

overpayment.” Id. There, “any potential for conflicts of

interest” between and among the consumers and third-party payors

that may have arisen “were adequately represented by the presence

of separate counsel for consumers and TPPs [third-party payors].” 

Id. (finding that the existence of separate counsel “provided

adequate structural protections to assure that differently situated

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plaintiffs negotiate for their own unique interests") (inner

quotations omitted). Here, too, there is separate counsel for the

individual Plaintiffs and for SEIU. Further, as in Warfarin,

Defendant has “only asserted, rather than established, an inherent

conflict among consumers and between consumers and TTPs.” Id. at

533.

Because separate counsel for the different types of class

members is present, the Court concludes that Doe 1 and SEIU will

fairly and adequately protect the interests of the class, as will

their counsel. In an abundance of caution, however, the Court

creates subclasses for individual class members and for

institutional class members. Id. at 533 n.14 (noting that

subclasses have been usefully employed in anti-trust cases). Doe 1

shall be the class representative of the individual class members;

SEIU shall be the class representative of the institutional class

members. 

III. Rule 23(b)

Having met the prerequisites of Federal Rule of Civil

Procedure 23(a) for class certification, Plaintiffs are entitled to

proceed on a class basis if they meet the requirements of one of

the subsections of Federal Rule of Civil Procedure 23(b). 

Plaintiffs move for certification under both subsection (b)(2) and

(b)(3). 

A. Rule 23(b)(2)

As noted above, Plaintiffs allege that Defendant’s conduct

violates section 2 of the Sherman Act. Plaintiffs seek class

certification under Rule 23(b)(2) of their anti-trust claim for

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2

As noted above, the unfair competition claim is brought on

behalf of those class members who are or were California residents

during the class period. 

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injunctive relief. Rule 23(b)(2) requires that "the party opposing

the class has acted or refused to act on grounds generally

applicable to the class, thereby making appropriate final

injunctive relief or corresponding declaratory relief with respect

to the class as a whole." Fed. R. Civ. P. 23(b)(2). As Plaintiffs

note, Defendant does not dispute that a nation-wide class for

injunctive relief is appropriate. And the Court finds that

Defendant allegedly “has acted or refused to act on grounds

generally applicable to the class.” Id. Therefore, a nation-wide

class for injunctive relief for Plaintiffs’ section 2 Sherman Act

claim is appropriate. 

B. Rule 23(b)(3)

Plaintiffs seek class certification under Rule 23(b)(3) of

their claims under the common law of unjust enrichment and under

California’s Unfair Competition Law.2 See Cal. Bus. and Prof. Code

§ 17200, et seq. 

Rule 23(b)(3) requires that questions of law or fact common to

the members of the class predominate over any questions affecting

only individual members and that a class action is the superior

method for litigating the claims. “The Rule 23(b)(3) predominance

inquiry tests whether proposed classes are sufficiently cohesive to

warrant adjudication by representation.” Amchem Prod., Inc. v.

Windsor, 521 U.S. 591, 623 (1997). “When common questions present

a significant aspect of the case and they can be resolved for all

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members of the class in a single adjudication, there is clear

justification for handling the dispute on a representative rather

than an individual basis.” Hanlon, 150 F.3d at 1022 (internal

quotation marks omitted). “The policy at the very core of the

class action mechanism is to overcome the problem that small

recoveries do not provide the incentive for any individual to bring

a solo action prosecuting his or her rights.” Amchem, 521 U.S. at

617. 

1. Unjust Enrichment

Plaintiffs argue that a nation-wide unjust enrichment class

should be certified. They contend that, because "common proof" can

be used to measure the restitution to which the class members would

be entitled, common questions of law and fact predominate over

questions affecting class members individually. According to

Defendant, however, the laws of the fifty States vary and the

individual issues predominate and therefore class certification of

a nation-wide unjust enrichment class is inappropriate. 

Defendant is correct in part. Although many States, including

California, follow the Restatement's definition of unjust

enrichment, not all do. See In re Terazosin Hydrochloride, 220

F.R.D. 672, 697 (S.D. Fla. 2004). Laws concerning unjust

enrichment do vary from State to State. After the hearing, the

parties submitted a letter to the Court in which they agreed that

two States, Indiana and Ohio, preclude indirect purchasers from

asserting claims for unjust enrichment and that there is no

authority in twenty-six States expressly prohibiting indirect

purchasers from obtaining unjust enrichment for violations of state

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anti-trust statutes. They disagree whether the law of twenty-four

other States precludes indirect purchasers from recovering unjust

enrichment. 

Differences in state law claims can outweigh the similarities,

precluding class certification as to those claims. See Schumacher

v. Tyson Fresh Meats, Inc., 221 F.R.D. 605, 612-613 (D. S.D. 2004). 

But differences do not always outweigh the similarities, especially

in cases concerning unjust enrichment claims. See, e.g., Westways

World Travel, 218 F.R.D. at 240 (certifying nation-wide class of

unjust enrichment claimants). As noted in Schumacher, 

Where federal claims and common law claims are predicated on

the same factual allegations and proof will be essentially the

same, even if the law of different states might ultimately

govern the common law claims -- an issue that need not and is

not decided at this juncture -- certification of the class for

the whole action is appropriate. The spectre of having to

apply different substantive laws does not warrant refusing to

certify a class on the common-law claims.

221 F.R.D. at 612 (quotations and alteration omitted); see also

Hanlon, 150 F.3d at 1022 ("Variations in state law do not

necessarily preclude a 23(b)(3) action.").

Here, the variations among some States' unjust enrichment laws

do not significantly alter the central issue or the manner of

proof. Common to all class members and provable on a class-wide

basis is whether Defendant unjustly acquired additional revenue or

profits by virtue of an anti-competitive premium on the price of

Norvir. See Schumacher, 221 F.R.D. at 612 ("In looking at claims

for unjust enrichment, we must keep in mind that the very nature of

such claims requires a focus on the gains of the defendants, not

the losses of the plaintiffs. That is a universal thread

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throughout all common law causes of action for unjust

enrichment."). The "idiosyncratic differences" between state

unjust enrichment laws "are not sufficiently substantive to

predominate over the shared claims." See Hanlon, 150 F.3d at 1022.

Defendant also argues that certification of Plaintiffs' unjust

enrichment claim should be denied because issues relating to

causation and injury will require a tremendous amount of

individualized proof. It notes that, to obtain certification,

"plaintiffs must establish, with generalized proof, that all

members of the class suffered damage as a result of defendants'

alleged [anti-competitive conduct]." Dynamic Random Access Memory,

2006 U.S. Dist. LEXIS 39841, *40 (N.D. Cal.). It argues that

Plaintiffs cannot make that showing here. 

Plaintiffs' expert disagrees and criticizes the analysis upon

which Defendant relies. The Court, however, "cannot weigh in on

the merits of plaintiffs' substantive arguments, and must avoid

engaging in a battle of expert testimony." Id. at *45. Indeed,

the court in Dynamic Random Access Memory explained that, "during

the class certification stage, the court must simply determine

whether plaintiffs have made a sufficient showing that the evidence

they intend to present concerning antitrust impact will be made

using generalized proof common to the class and that these common

issues will predominate." Id. at *44-5 (inner quotations omitted). 

Plaintiffs have made such a showing.

The Court finds that common questions do predominate over any

questions affecting only individual members. The Court similarly

finds that class resolution of this claim is superior to other

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available methods. In anti-trust cases such as this, the damages

of individual consumers are likely to be too small to justify

litigation, but a class action would offer those with small claims

the opportunity for meaningful redress. Further, failure to

certify the unjust enrichment claims could result in class members

having to file thousands of individual suits in which the discovery

and factual issues would be nearly identical. And, if necessary,

sub-classes can be identified to group residents of various States

with identical common law requirements. These problems are

manageable and, therefore, a class action is the superior method of

resolving the unjust enrichment claims. The class, however, will

not include any indirect purchasers who were citizens of Indiana

and Ohio at the relevant time. 

2. Unfair Competition 

As Plaintiffs note, claims brought under the California Unfair

Competition Law are commonly certified for class treatment. See,

e.g., Corbett v. Super. Ct., 101 Cal. App. 4th 649 (2002). Here,

the Court finds that Defendant's alleged illegal conduct presents

common questions of fact and law that will be subject to common

proof and that a class action is the superior method of resolving

Plaintiffs' unfair competition claim. Indeed, Defendant does not

dispute that Plaintiffs' unfair competition claim meets the

requirements of Rule 23(b)(3); rather, as addressed above, it only

argues that no named Plaintiff has standing to bring this claim, an

argument the Court rejected. Therefore, the Court finds that

Plaintiffs have met their burden under Rule 23(b). 

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CONCLUSION

 For the foregoing reasons, the Court GRANTS IN PART

Plaintiffs’ Motion for Class Certification (Docket No. 287), and

certifies the class as follows: 

All persons or entities throughout the United States and its

territories who purchased or paid for, or who reimbursed another

person or entity who purchased or paid for, Norvir as a booster to

other protease inhibitors intended for consumption by themselves,

their families, or their members, employees, plan participants and

beneficiaries or insureds, and who paid all or part of the cost of

Norvir during the period December 3, 2003 through such time in the

future as the effects of Defendant's illegal conduct, as alleged,

have ceased. Excluded from the Class is Defendant and its

subsidiaries and affiliates, all government entities (except for

government-funded employee benefits funds), and all persons or

entities that purchase Norvir: (i) for purposes of resale, or

(ii) directly from Defendant. 

Within this class, the Court creates a subclass for individual

class members and another subclass for institutional class members.

Doe 1 shall be the class representative of the individual class

members; SEIU shall be the class representative of the

institutional class members. If necessary, the Court will create

subclasses for those who paid a fixed co-payment for Norvir and

those who did not and for the unjust enrichment claims. Indirect

purchasers from Ohio and Indiana, however, will be precluded from

recovering for unjust enrichment and thus shall not be part of any

unjust enrichment subclass.

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3

Defendant's Motion for Leave to File Supplementary Authority

(Doc. 344) is DENIED.

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The Court appoints Plaintiffs Doe 1 and SEIU as class

representatives. The law firm of Berman DeValerio Pease Tabacco

Burt & Pucillo is appointed as counsel for the class and for the

subclass of individual class members; the law firm of Labaton

Sucharow & Rudoff LLP is appointed as counsel for the class and for

the subclass of the institutional class members.3

IT IS SO ORDERED.

6/11/07

Dated: ________________________ 

CLAUDIA WILKEN

United States District Judge

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