UNITED STATES DISTRICT COURT FOR THE 

 EASTERN DISTRICT OF PENNSYLVANIA

 

) CASE NO.: 

Marna Berkman, individually and on )

behalf of all others similarly situated, )

)

Plaintiff, ) CLASS ACTION COMPLAINT

)

v. )

)

MCNEIL-PPC, INC., ) JURY TRIAL DEMANDED

)

Defendant. )

__________________________________________)

Plaintiff, Marna Berkman, individually and on behalf of all others similarly situated, by

her undersigned attorneys, for her Complaint against defendant McNeil-PPC, Inc. (“McNeil” or

“Defendant”) upon knowledge as to matters relating to herself and upon information and belief

as to all other matters, alleges as follows:

NATURE OF THE ACTION

1. This class action is brought on behalf of all persons or entities who purchased

Imodium Advanced® (“Imodium Advanced”) in the United States during the period from

October 1, 2000 to the present (the “Class Period”) to recover damages caused by Defendant’s

violations of Section 2 of the Sherman Act, 15 U.S.C. §2, and the antitrust and/or unfair business

competition statutes of twenty states and the District of Columbia. Defendant’s unlawful

conduct prevented generic versions of Imodium Advanced from coming to the United States

market, thereby causing injury to plaintiff and other members of the class.

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2. Imodium Advanced is an over-the-counter anti-diarrheal/anti-flatulent drug. 

Defendant McNeil has been marketing Imodium Advanced since the drug first received FDA

approval in 1997 and has recognized well over a $100 million in sales from this drug. No

generic version of Imodium Advanced is currently marketed in the United States because

Defendant, through “repeated erroneous representations, failure to disclose relevant prior art, and

overall persistence in prosecuting exceedingly obvious inventions” deceived the Patent and

Trademark Office (“PTO”) into issuing a series of patents covering an anti-diarrheal/antiflatulent drug. These patents include: U.S. Patent No. 5,248, 505 (the “`505 patent”); U.S. Patent

No. 5,612, 054 (the “`054 patent”); U.S. Patent No. 5,679,376 (the “`376 patent”); and U.S.

Patent No. 5,716,641 (the “`641 patent”). 

3. Upon closer examination by this Court, Defendant’s actions before the PTO have

been criticized as “a scheme without the slightest regard for the intent and purposes of the patent

laws. Indeed, [Defendant’s] sole motive was to compromise these statutes and constitutional

protections for the sake of profits.” On or about June 25, 2002, Defendant’s patents for the antidiarrheal/anti-flatulent agent were ruled invalid for obviousness.

4. L. Perrigo Company (“Perrigo”), a generic manufacturer of pharmaceuticals, has

filed an application with the FDA requesting approval to market a generic version of Imodium

Advanced. In its application, Perrigo asserted that its product is bioequivalent to Imodium

Advanced and does not infringe any valid patent owned by or licensed to Defendant. Because of

Defendant’s actions, however, no generic formulation of Imodium Advanced has been approved

by the FDA.

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5. Count I of this Complaint is brought by Plaintiff, on behalf of herself and all

others similarly situated (“Nationwide End-Payor Class”), seeking injunctive and declaratory

relief under Section 16 of the Clayton Act, 15 U.S.C. § 26.

6. Count II of this Complaint is brought by Plaintiff, on behalf of herself and a

proposed sub-class of indirect purchasers who purchased or paid for Imodium Advanced in

Arizona, California, District of Columbia, Florida, Kansas, Louisiana, Maine, Massachusetts,

Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, North

Dakota, South Dakota, Tennessee, Vermont, West Virginia and Wisconsin (collectively, the

“Indirect Purchaser States”), alleging agreements in restraint of trade and monopolization of the

market for Imodium Advanced in violation of the antitrust laws of the Indirect Purchaser States

(the “Indirect Purchaser Sub-Class”).

7. Count III of this Complaint is brought by Plaintiff on her own behalf and on

behalf of the Nationwide End-Payor Class, seeking a constructive trust and disgorgement of the

unjust enrichment of defendants.

JURISDICTION AND VENUE

8. This action is brought under Section 16 of the Clayton Act, 15 U.S.C. §26, for

injunctive relief, and the costs of suit, including reasonable attorneys’ fees, for injuries to

plaintiff and members of the class resulting from, inter alia, defendants’ violations of the federal

antitrust laws. The Court has jurisdiction over this action pursuant to 28 U.S.C. §§1331 and

1337 and 15 U.S.C. §26. This Court has supplemental jurisdiction over the state law claims

pursuant to 28 U.S.C. §1367(a).

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9. Venue is proper in this judicial district pursuant to 15 U.S.C. §22 and 28 U.S.C.

§1391(b) because a substantial portion of the affected trade and commerce described below has

been carried out in this district.

INTERSTATE TRADE AND COMMERCE

10. During all or part of the relevant time period:

1. Defendant manufactured and sold substantial amounts of Imodium

Advanced in a continuous and uninterrupted flow of commerce across

state and national lines and throughout the United States;

2. Defendant transmitted funds as well as contracts, bills and other forms of

business communications and transactions in a continuous and

uninterrupted flow of commerce across state and national lines in

connection with the sale of Imodium Advanced; and

3. Defendant employed, in furtherance of their monopolization and attempt

to monopolize, as alleged herein, the United States mails and interstate and

international telephone lines as well as means of interstate and

international travel.

11. The illegal monopolization and attempt to monopolize the market for Imodium

Advanced and its generic bioequivalents alleged herein have substantially affected interstate

commerce.

THE PARTIES

Plaintiff

12. Plaintiff Marna Berkman is a citizen of the State of New York. Plaintiff Marna

Berkman purchased Imodium Advanced during the Class Period and, like the other members of

the class, paid more than she would have absent Defendant’s unlawful monopolization and

attempts to restrict generic competition for Imodium Advanced.

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Defendant

13. McNeil-PPC, Inc. is a New Jersey Corporation with its principal place of business

in Fort Washington, Pennsylvania. McNeil markets a range of over-the-counter and prescription

drugs. McNeil is a division of the leading pharmaceutical giant Johnson & Johnson. 

RELEVANT MARKET

14. To the extent applicable to the claims alleged herein, the relevant product market

is the market for the manufacture and sale of Imodium Advanced and generic bioequivalents.

The relevant geographic market is the United States as a whole (for Counts I and III) and the

Indirect Purchaser States (for Count II). At all relevant times, including the present. Defendant’s

market share in the relevant product and geographic markets was and is 100%.

FACTUAL ALLEGATIONS

A. The Federal Scheme for Approval of Pioneer Drugs

15. Under the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. § 301 et seq. (the

“Act”) approval by the FDA is required before a company may begin selling a new drug. 

Premarket approval for a new drug, often referred to as a “pioneer” or “branded” drug, must be

sought by filing a New Drug Application (“NDA”) with the FDA demonstrating that the drug is

safe and effective for its intended use. New drugs that are approved for sale in the United States

by the FDA are typically (but not necessarily) covered by patents, which provide the patent

owner with the exclusive right to sell that new or pioneer drug in the United States for the

duration of the patents involved, plus any extension of the original patent period (the “FDA

Exclusivity Period”) granted pursuant to the Drug Price Competition and Patent Term restoration

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Act of 1984, 98 Stat. 1585, codified at 21 U.S.C. §355(j) (the “Hatch-Waxman Act”) and 35

U.S.C. §271(e).

16. In addition to information on safety and efficacy, NDA applicants must submit to

the FDA a list of all patents that claim the drug for which FDA approval is being sought, or that

claim a method of using that drug, and with respect to which a claim of patent infringement

could reasonably be asserted against an unlicensed manufacturer or seller of the drug.

17. Once the NDA is approved, the FDA lists any patents referenced as part of the

NDA application process in the Approved Drug Products with Therapeutic Equivalence

Evaluations (commonly referred to as the “Orange Book”), where it can be easily found and

consulted by future FDA applicants.

18. Pursuant to 21 U.S.C. §355(c)(2), if, after its NDA is approved, the pioneer drug

manufacturer obtains a new patent that claims the drug or methods of its use, the company must

supplement its NDA by submitting information on the new patent within 30 days of issuance. 

The FDA then lists the new patent in a supplement to the Orange Book. The FDA is required to

accept as true the patent information is obtains from patent holders, and to withhold its approval

of a subsequent drug application, whenever the patent holder presents a litigated dispute

(baseless or not) regarding the validity or infringement of the patent. If an unscrupulous patent

holder provides false information to the FDA or files frivolous patent infringement actions to

delay the onset of generic competition, the FDA is powerless to stop it.

19. Once the safety and effectiveness of a new drug is approved by the FDA, it may

be used in the United States.

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B. Generic Drugs

20. Generic drugs are drugs that the FDA has found to be bioequivalent to brand

name drugs, i.e, generic drugs have the same active chemical composition and provide the same

therapeutic effects as the pioneer, brand name drugs. 

21. Generic drugs are invariably priced below the branded drugs to which they are

bioequivalent. The first generic competitor to market typically does so at a price at least 30%

lower than the price of the equivalent brand name drug and quickly takes a substantial amount of

market share away from the brand name manufacturer. As additional generic competitors come

to market, the price of the generic equivalents continues to fall, and their combined market share

continues to grow. 

22. The price competition engendered by generic drug manufacturers benefits all

purchasers of the drug, who are able to buy the same chemical substance at much lower prices. 

C. Abbreviated New Drug Applications for Generic Drugs

23. Congress enacted the Hatch-Waxman Act in 1984 to establish an abbreviated

process to expedite and facilitate the development, approval and marketing of generic drugs. To

effectuate its purpose, the Hatch-Waxman Act permits a generic drug manufacturer to file an

“abbreviated” new drug application (“ANDA”), which incorporates by reference the safety and

effectiveness data developed and previously submitted to the FDA by the company that

manufactured the original, “pioneer” drug. 

24. The most important new information that must be included in the ANDA

concerns the generic company’s position vis-a-vis the patent that the pioneer manufacturer claims

applies to the drug. Therefore, the ANDA filer must make one of four certifications to the FDA:

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1. That no patent for the pioneer drug has been filed with the FDA (a

“Paragraph I Certification”);

2. That the patent (or patents) for the pioneer drug has (or have) expired (a

“Paragraph II Certification”);

3. That the patent for the pioneer drug will expire on a particular date and the

generic company does not seek to market its generic product before that

date (a “Paragraph III Certification”); or

4. That the patent for the pioneer drug is invalid or will not be infringed upon

by the proposed generic company’s product (a “Paragraph IV

Certification”).

21 U.S.C. §355(j)(2)(A)(vii). In the case of a patent that has not yet expired, the ANDA

applicants only certification options are Paragraph III or IV certifications. See id. If the generic

manufacturer makes a Paragraph IV Certification, the ANDA applicant must notify the patent

owner of the filing and explain why the patent is invalid or will not be infringed. See 21 U.S.C.

§355(j)(2)(A)(vi)(IV).

25. The patent owner, upon receiving a Paragraph IV Certification from an ANDA

Applicant has a 45-day statutory period in which to initiate a patent infringement suit against the

applicant. See 21 U.S.C. §355(j)(5)(B)(iii). If no action is initiated within 45 days, FDA

approval of the generic product is not delayed by patent issues. However, if a patent

infringement suit is brought within the 45-day window, FDA approval of the generic drug is

automatically postponed until the earliest of: (i) the expiration of the patent: (ii) thirty months

from the patent holders receipt of the Paragraph IV Certification (30-month stay); or (iii) a final

judicial determination of invalidity or non-infringement from which no appeal can be or has been

taken. Id; 21 C.F.R. §314.107.

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D. Defendant’s Wrongful Conduct

26. Loperamide is a non-addictive opiate and is believed to treat diarrhea in a number

of ways including regulating muscular contractions in the intestine, limiting secretions in the

intestinal tract, and relieving abdominal discomfort. 

27. Simethicone is a drug employed to treat flatulence associated with diarrhea.

28. The anti-diarreheal/anti-flatulent drug Immodium Advanced contains both

loperamide and simethicone. Immodium Advanced's predecessor drug, Imodium A-D, contains 

the anti-diarreheal loperamide but does not contain the anti-flatulent simethicone. 

29. When first marketed and sold in 1988, predecessor drug Imodium A-D was

protected by a number of patents for loperamide (the "loperamide patents"). Upon expiration of

the loperamide patents, Imodium A-D faced intense competition from generic manufacturers who

could manufacture and sell a generic version of Imodium A-D for approximately 30% to 40%

less than the price charged by Defendant. 

30. Upon expiration of the loperamide patents in the late 1980's, generic manufacturer

Perrigo began marketing a generic brand of loperamide similar to that of Imodium A-D. 

31. In response to the generic competition it faced for Imodium A-D, Defendant

directed one its scientists, Dr. Jeffrey Garwin, to develop a new patent-protected form of

loperamide. Pursuant to this directive, Dr. Garwin developed a drug which combined loperamide

with the anti-flatulent simethicone. 

32. Dr. Garwin subsequently filed with the PTO for patents to cover the combination

of loperamide and simethicone. During the course of the prosecution of the patents, Defendant

represented before the PTO that Dr. Garwin had discovered the concurrence of diarrhea and

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flatulence and the invention to be awarded patent protection "lies not in the discovery of a novel

solution to this problem, but in the discovery of the problem itself." Based upon Defendant's

representations, the PTO issued two patents which were assigned to Defendant - U.S. Patent No.

5,248,505 (the "'505 patent") on September 28, 1993 and U.S. Patent No. 5,612,054 (the "'054

patent") on March 18, 1997.

33. Subsequently, two additional patents were issued for the combination of

loperamide and simethicone, U.S. Patent No. 5,679,376 (the "'376 patent") issued on October

21, 1997; and U.S. Patent No. 5,716,641 (the "641 patent") issued on February 10, 1998. Since

their issuance, the '505, '054, '376 and '641 patents all have been held to have been issued

erroneously and have been invalidated.

34. Beginning on or about October 1, 1997, Defendant manufactured, marketed and

sold the loperamide-simethicone drug combination under the brand name Imodium Advanced. 

Defendant's aggressively marketed Imodium Advanced as a significant advancement over

Imodium A-D, spending approximately $45 million to win consumers over to its drug which had

no generic competition. Imodium Advanced's sales skyrocketed in its first years on the market

and are projected to reach $200 million by the end of 2002.

35. Interest in a cheaper generic version of Imodium Advanced began almost

immediately after Imodium Advanced went to market. Pursuant to this interest, Perrigo

consulted outside patent counsel as to whether Perrigo's version of loperamide-simethicone

would infringe the Imodium Advanced patents. Perrigo's patent counsel concluded the the

proposed generic verison of loperamide-simethicone would not infringe the Imodium Advanced

patents because these patents were invalid. 

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36. On or about November 2000, Perrigo filed an ANDA seeking FDA approval to

manufacture, mrket and sell a generic version of Imodium Advanced in the United States. 

37. Facing the threat of extinction of its extremely profitable Imodium Advanced

product, Defendant filed suit against Perrigo, alleging patent infringement. On April 22, 2002,

this Court began to hear testimony in the trial of Defendant's patent infringement suit against

Perrigo. On or about June 25, 2002, this Court invalidated the '505 patent, the '054 patent, the

'376 patent and the '641 patent as invalid for obviousness. 

38. In examining Defendant's representations made during the patent application to

the PTO this Court found the following: 

1. With respect to Defendant's representation that Dr. Garwin had discovered

the concurrence of diarrhea and flatulence, this Court found that Defendant failed to bring to the

PTO's attention the existence of more than twenty scientific and medical articles and publications

which noted the concurrence of diarrhea and gas-related symptoms that were issued before Dr.

Garwin claimed to be the originator of the discovery.

2. With respect to Defendant's representation to the PTO that Dr. Garwin was

the first to combine an antidiarrheal with simethicone, the Court found that Defendant failed to

bring to the PTO's attention that:

• Since 1974 the FDA had approved of the use of simethicone in combination with 

other pharmaceuticals.

• By the time of Dr. Garwin's claimed invention, simethicone was a well-known

and increasingly popular antiflatulent, sold commercially in more than twentyfive products.

• The dosage regimen in the proposed patents to be issued to Dr. Garwin were not

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new Other marketed over-the-counter products contained the same amount of

simethicone as proposed by Dr. Garwin. Additionally, the amounts specified for

loperamide by Dr. Garwin also were already used in several over-the-counter

products.

• At least as early as 1980, an Australian pharmaceutical reference publication 

included a reference to a product called Diareze which combined an antidiarrheal

with simethicone.

• A patent existing at the time of Dr. Garwin's proposal, the Chavkin patent, already

covered the combination of an antidiarrheal with simethicone.

• Another existing patent at the time, French Patent Publication 2,565,107, also

covered the combination of an antidiarrheal with simethicone. 

 

39. Based on these compelling facts, this Court invalidated the patents for

obviousness, stating that the Defendant had misled the PTO in that: 

During the course of the lengthy prosecution of the...patents,

[Defendant's] attorneys made a number of erroneous

representations. ..First, McNeil incorrectly argued to the Patent and

Trademark Office that Dr. Garwin had discovered the concurrence

of diarrhea and flatulence...[however] Dr.Garwin did not discover

the concurrence of diarrhea and gas. Moreover...McNeil's

attorneys failed to provide the Examiner with evidence that would

have called into question McNeil's assertion that Dr. Garwin had

discovered the concurrence of diarrhea and flatulence....Second,

McNeil's attorneys permitted the Examiner to believe mistakenly

that Dr. Garwin was the first to combine an antidiarrheal with

simethicone.

40. Defendant's conduct before the PTO was so egregious and exceptional that this

Court ordered Defendant to pay Perrigo's attorneys' fees. In awarding the attorneys' fees, this

Court summarized Defendant's behavior during the prosecution of the patents as "careless,

irresponsible, and, at the very least, tantamount to studied and deceptive ignorance."

VI.

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G. The Effects of Defendants’ Anti-Competitive Conduct

on the United States Market for Imodium Advanced

41. Defendants’ improper patent filings are delaying and preventing the entry into the

United States market of generic formulations of Imodium Advanced.

42. The purpose of Defendants’ anti-competitive conduct is to obtain and maintain

monopoly power in the market for Imodium Advanced and its generic equivalents.

43. Defendants have succeeded in obtaining this unlawful market power. With this

monopoly power, defendants have fixed prices for Imodium Advanced at artificially high and

supra-competitive levels.

44. Due to Defendants’ monopolization, manufacturers of generic bioequivalents of

Imodium Advanced are being restrained and denied the opportunity to market competing

products, which would be marketed at substantially lower prices.

45. Defendants have engaged in monopolistic practices concerning Imodium

Advanced to avoid a loss in market share and revenues that would inevitably result following the

introduction to the market of a competing generic product.

46. As a result of Defendant’s anti-competitive conduct, plaintiff and the Class have

been and/or will be forced to pay supra-competitive and artificially high prices for Imodium

Advanced.

CLASS ACTION ALLEGATIONS

47. Plaintiff brings this action pursuant to Rule 23 of the Federal Rules of Civil

Procedure, specifically Rules 23(b)(2) and 23(b)(3), on behalf of the following class (the

“Class”):

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(a) All persons residing in the United States of America, the District of

Columbia, and Puerto Rico that have paid, in whole or in part, for

Imodium Advanced between October 1, 2000 and the present (the “Class

Period”).

50. With respect to Count II, the Class seeks damages as to those persons residing in

the Indirect Purchaser States who have paid, in whole or in part, for Imodium Advanced during

the Class Period (the “Indirect Purchaser State Claims”).

51. Excluded from the Class are Defendants and their respective subsidiaries and

affiliates, all governmental entities, and all persons or entities that purchased Imodium Advanced

for purposes of resale.

52. Plaintiff believes, and therefor avers, that there are thousands of members in the

above-described class; their exact number and identities being currently unknown to plaintiff but

known to defendant and/or ascertainable from appropriate discovery.

53. Among the questions of law and fact common to the Class are:

1. Whether Defendants have unlawfully monopolized or attempted to

monopolize the market for Imodium Advanced and its generic equivalents;

2. Whether Defendants possessed and/or unlawfully extended their monopoly

power over the market for Imodium Advanced and its generic equivalents;

3. Whether Defendants, through their monopolization and/or attempted

monopolization, have caused the prices of Imodium Advanced to be

maintained at supra-competitive levels;

4. Whether the Class suffered and continues to suffer antitrust injury; and

5. Whether Defendants were and continue to be unjustly enriched to the

detriment of the Class, entitling plaintiff and the Class to disgorgement of

all monies resulting therefrom.

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54. Plaintiff’s claims are typical of the Class because Plaintiff and all members of the

Class were injured and continue to be injured in the same manner by Defendants’ unlawful, anticompetitive and inequitable methods, acts and practices, and wrongful conduct in the

conspiracies complained of herein, i.e., they have paid supra-competitive and artificially high

prices for Imodium Advanced and will continue to be forced to do so until the markets for

Imodium Advanced and its generic equivalents are competitive and prices reach competitive

levels.

55. Plaintiff will fully and adequately protect the interests of all members of the Class. 

Plaintiff has retained counsel who are experienced in antitrust class action litigation. Plaintiff

has no interests which are adverse to, or in conflict with, other members of the Class. The

questions of law and fact common to the members of the Class predominate over any questions

which may affect only individual members.

56. A class action is superior to other available methods for the fair and efficient

adjudication of this controversy. The Class is readily definable and prosecution as a class action

will eliminate the possibility of duplicative litigation, while also providing redress for claims

which would otherwise be too small to support the expense of individual, complex litigation. 

Defendants have acted or refused to act, as alleged herein, on grounds generally applicable to the

Class, thereby making appropriate final injunctive relief and/or corresponding declaratory relief

with respect to the Class as a whole.

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COUNT I

FOR DECLARATORY AND INJUNCTIVE RELIEF

UNDER SECTION 16 OF THE CLAYTON ACT

FOR VIOLATIONS OF SECTION 2 OF THE SHERMAN ACT

57. Plaintiff repeats and realleges all preceding paragraphs of this Complaint as if

fully set forth herein.

58. Pursuant to U.S. patent laws, Defendant was given a lawful monopoly over sales

of Imodium A-D drug products, but that monopoly was only lawful so long as the drug, or a

method of its use, was fully covered by valid, unexpired patents.

59. As described above, Defendant knowingly and willfully engaged in a course of

conduct designed to extend their monopoly power. This course of conduct included, inter alia,

improperly filing a series of patents that merely replicated prior art in order to prevent Perrigo

and other potential generic manufacturers, from selling a generic version of Imodium Advanced.

60. During the Class Period, Defendant possessed monopoly power in the relevant

market.

61. Defendant intentionally and wrongfully maintained its monopoly power in the

relevant market in violation of Section 2 of the Sherman Act, 15 U.S.C. §2.

62. Plaintiff and members of the Class have been injured in their business or property

by reason of Defendant's antitrust violation alleged in this Count. Their injury consists of paying

higher prices for Imodium Advanced products than they would have paid in the absence of that

violation. Such injury is of the type antitrust laws were designed to prevent and flows from that

which makes Defendant's conduct unlawful.

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63. Plaintiff and members of the Class are likely to purchase Imodium Advanced

again in the future.

64. Defendant intended to prevent generic manufacturers from entering the Imodium

Advanced market by filing a series of patents replicating prior art and which are invalid for

obviousness. Now faced with judicial determination that these patents are invalid, Defendant,

could continue to prevent any generic company from entering the market while an appeal is

pending. Injunctive relief is, therefore, appropriate under 15 U.S.C. §26.

65. Plaintiff seeks to enjoin Defendant from engaging in future anti-competitive

practices concerning the manufacture, distribution or sale of Imodium Advanced. Plaintiff does

not seek damages under Count I.

66. Plaintiffs and the Class have no adequate remedy at law.

COUNT II

DAMAGE UNDER THE ANTITRUST AND DECEPTIVE

PRACTICE STATUTES OF THE INDIRECT PURCHASER STATES

67. Plaintiff repeats and realleges all preceding paragraphs of this Complaint as if

fully set forth herein.

68. This Count is brought by plaintiff on behalf of the Class to assert the Indirect

Purchaser State Claims.

69. The attempts to monopolize and monopolization of the relevant market alleged

herein violate the Indirect Purchaser States’ antitrust and/or deceptive practice statutes as

follows:

1. the aforementioned practices by defendants were and are in violation of

Arizona Revised Statutes §44-1408B;

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2. the aforementioned practices by defendants were and are in violation of

Cartwright Act, California Business and Professions Code Sections 16700,

et seq. and/or the California Unfair Competition Act, California Business

Professions Code Sections 17200, et seq.;

3. the aforementioned practices by defendants were and are in violation of

District of Columbia Code §28-4502, et seq. (1996 Repl.);

4. the aforementioned practices by defendants were and are in violation of

Chapter 501, Part II, Florida Statutes (the Florida Deceptive and Unfair

Trade Practices Act;

5. the aforementioned practices by defendants were and are in violation of

Kansas Statutes Annotated §§50-801(b) and 50-101, et seq.;

6. the aforementioned practices by defendants were and are in violation of

Louisiana Revised Statutes §51:137, et seq.;

7. the aforementioned practices by defendants were and are in violation of

Maine Revised Statutes Annotated, 10 M.R.S.A. §1101, et seq., and/or

Maine’s Unfair Trade Practices Act, 5 M.R.S.A. §205-A et seq.;

8. the aforementioned practices by defendants were and are in violation of

Massachusetts Ann. Laws, Ch. 93A, et seq.;

9. the aforementioned practices by defendants were and are in violation of

the Michigan Antitrust Reform Act, MCL §455-771, et seq. and/or the

Michigan Consumer Protection Act, MCL §445.901 et seq.;

10. the aforementioned practices by defendants were and are in violation of

Minnesota Antitrust Act of 1961, Minn. Stat. §§325D.49-325D.66 (1998);

11. the aforementioned practices by defendants were and are in violation of

the Nevada Unfair Trade Practice Act, NRS 598A.010, et seq.;

12. the aforementioned practices by defendants were and are in violation of

the New Mexico Antitrust Act, N.M. Stat. Ann. §57-1-1 to §57-1-5

(1998);

13. the aforementioned practices by defendants were and are in violation of

the New Jersey Consumer Fraud Act, N.J.S.A. §56:9-1, et seq.;

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14. the aforementioned practices by defendants were and are in violation of

the New York General Business Law §340, et seq. and/or New York

General Business Law §349;

15. the aforementioned practices by defendants were and are in violation of

North Carolina Gen. Stat. §75-1.1 et seq.;

16. the aforementioned practices by defendants were and are in violation of

North Dakota Cent. Code §51-08.1-08;

17. the aforementioned practices by defendants were and are in violation of

South Dakota antitrust law SDCL §37-1, et seq.;

18. the aforementioned practices by defendants were and are in violation of

Tenn. Code Ann. §47-25-101, et seq. and/or in violation of Tenn. Code

Ann. §47-18.101, et seq.;

19. the aforementioned practices by defendants were and are in violation of

Vermont antitrust law Vermont Stat. §2453, et seq.;

20. the aforementioned practices by defendants were and are in violation of

West Virginia Consumer Credit and Protection Act, W. Va. Code §46-A1-101, et seq.; and

21. the aforementioned practices by defendants were and are in violation of

the Wisconsin Antitrust Act §133.01 et seq.

68. Plaintiff and the Class seek damages and multiple damages as permitted by law

for their injuries by defendants’ violations of the aforementioned statutes.

COUNT III

FOR RESTITUTION, DISGORGEMENT AND CONSTRUCTIVE TRUST

FOR UNJUST ENRICHMENT BY DEFENDANTS

69. Plaintiff repeats and realleges all preceding paragraphs of this Complaint as if

fully set forth herein.

70. Defendant has benefitted from the monopoly profits on their sale of Imodium

Advanced resulting from their unlawful and inequitable acts alleged in this Complaint.

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71. Defendant’s financial benefits resulting from their unlawful and inequitable

conduct are traceable to overpayments for Imodium Advanced by Plaintiff and members of the

Class. Plaintiff and the Class have conferred upon Defendants an economic benefit, in the nature

of the profits resulting from unlawful overcharges and monopoly profits, to the economic

detriment of Plaintiff and the Class.

72. The economic benefit of overcharges and unlawful monopoly profits derived by

Defendant through charging supra-competitive and artificially inflated prices for Imodium

Advanced is a direct and proximate result of Defendant’s unlawful practices.

73. The financial benefits derived by Defendant rightfully belong to Plaintiff and the

Class, as Plaintiff and the Class paid anti-competitive and monopolistic prices during the Class

Period, inuring to the benefit of Defendant.

74. It would be inequitable and unjust for Defendant to be permitted to retain any of

the unlawful proceeds resulting from the filing of baseless patents.

75. It would be inequitable for the Defendant to be permitted to retain any of the

overcharges for Imodium Advanced derived from Defendants’ unfair and unconscionable

methods, acts and trade practices alleged in this Complaint.

76. Defendant should be compelled to disgorge in a common fund for the benefit of

Plaintiff and the Class all unlawful or inequitable proceeds received by them.

77. A constructive trust should be imposed upon all unlawful or inequitable sums

received by Defendant traceable to Plaintiff and the Class.

78. Plaintiff and the Class have no adequate remedy at law.

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PRAYER FOR RELIEF

WHEREFORE, Plaintiff respectfully requests that this Court enter an Order:

1. certifying the Class pursuant to the Federal Rules of Civil Procedure, certifying

Plaintiff as the representative of the class, and designating its counsel as counsel for the class;

2. declaring that Defendant’s filing of patents that were objectively invalid for

obviousness was in violation of §2 of the Sherman Act;

3. declaring the Defendant’s filing of patents that were objectively invalid for

obviousness was in violation of the antitrust and/or deceptive practice statutes in the Indirect

Purchaser States;

4. enjoining and restraining Defendant’s continuing violation of §2 of the Sherman

Act, pursuant to §16 of the Clayton Act;

5. granting Plaintiff and the Class equitable relief in the nature of disgorgement,

restitution, and the creation of a construction trust remedy to Defendant’s unjust enrichment;

6. granting Plaintiff and the Class damages as permitted by law;

7. granting Plaintiff and the Class their costs of prosecuting this action, together with

interest and attorneys’ fees, experts’ fees and costs; and

8. granting such other relief as this Court may deem just and proper.

DATED: July , 2002 

Arnold Levin, Esquire

Laurence S. Berman, Esquire

Daniel Levin, Esquire

LEVIN, FISHBEIN, SEDRAN & BERMAN

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510 Walnut Street

Suite 500

Philadelphia, PA 19106 

(215) 592-1500

(215) 592-4663 (fax)

Linda P. Nussbaum

Jacqueline E. Bryks

COHEN MILSTEIN HAUSFELD & TOLL

825 Third Avenue, 30th floor

New York, NY 10022-7519

Tel: (212) 838-7797

Fax: (212) 838-7745

Attorneys for Plaintiff

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