Friday, December 30, 2016

Contracts can last longer than headaches: 1990 consent decree bars comparisons today

Pfizer Inc. v. McNeil-PPC, Inc., 183 F. Supp. 3d 491 (S.D.N.Y. 2016)

A twenty-six-year-old consent decree resolving false advertising claims bans certain comparisons between Advil (Pfizer) and Tylenol (McNeil). Several years after the decree’s entry, Pfizer introduced Advil products designed for children and infants. The court determined that the consent decree barred claims comparing the newer Advil products to Tylenol.

The initial lawsuits involved both parties’ comparative claims about Tylenol and Advil’s side effects and safety, as well as Advil ads that claimed, “Like Tylenol, Advil doesn’t upset my stomach.” Am. Home Products Corp. v. Johnson & Johnson, 654 F.Supp. 568 (S.D.N.Y.1987) (Advil I); McNeilab, Inc. v. Am. Home Products Corp., 675 F.Supp. 819 (S.D.N.Y.1987) aff’d, 848 F.2d 34 (2d Cir.1988) (Advil II).  The relevant consent judgment enjoined Pfizer’s predecessor (and Pfizer, as a party in privity) from “stating in words or substance in any advertisement that ADVIL is ‘like TYLENOL’ in the respect of adverse effects on the stomach ....”

After signing that order, Pfizer’s predecessor conducted a study titled the Children’s Analgesic Medicine Project. The CAMP study compared the safety of Advil’s active ingredient, ibuprofen, and Tylenol’s active ingredient, acetaminophen, in over 41,000 children suffering from fever and pain, over 14,000 of whom were infants under the age of two.  The parties now disputed the meaning of the word “ADVIL” in the order. Pfizer argued that it meant only the 200 milligram adult Advil tablet on the market at time the order was drafted, allowing Pfizer to run comparative stomach safety advertisements for pediatric Advil products. McNeil argued that the order covered all Advil products that contain the drug ibuprofen, including pediatric Advil.

Consent decrees are contracts, and interpreting them is a matter of ordinary contract interpretation, which allows consideration of documents expressly incorporated in the consent judgment, as well as of extrinsic evidence of the parties’ intent where a term is ambiguous.  However, “because consent decrees are normally compromises in which the parties give up something they might have won in litigation and waive their rights to litigation, it is inappropriate to search for the ‘purpose’ of a consent decree and construe it on that basis.”

On its face without including incorporated documents, the order was ambiguous: “ADVIL” could plausibly mean all Advil products, including later-created ones.  The order contained “no limitation on the word Advil or reservation of rights in relation to specific dosages or variations of Advil products.” Still, it was also plausible to read the order as limited to the “ADVIL” that existed at the time of drafting.  However, the court concluded that the Advil II order incorporated the opinions from the Advil I and Advil II cases.  Given that incorporation, the order unambiguously included all Advil products whose active ingredient is ibuprofen.  The Advil I opinion spent a lot of time discussing the side effects caused by the products’ active ingredients, not just the brand name/specific formulation: the Advil I findings were findings about ibuprofen the drug.  The Advil II court then equated “ADVIL” with ibuprofen. Because the Advil II court used “Advil” and “ibuprofen” interchangeably, the court here found that the term “Advil” “encompasses not just the specific Advil products contemporaneously on the market, but any Advil product whose active ingredient is ibuprofen.”

McNeil’s interpretation didn’t expand the plain meaning of the word Advil to include all Advil products that contain ibuprofen: it was the plain meaning. Plus, allowing Pfizer to interpret the order to include only 200 milligram adult Advil, which was what was on the market at the time, “would make it virtually meaningless, because it would allow Pfizer to escape its application merely by manufacturing and selling slightly modified versions of the 200 milligram tablet.”

Nor did the language of the consent decree in Advil I change things: that consent decree included broad language that enjoined Pfizer from making certain advertising claims related to “Advil, any other ibuprofen products, or ibuprofen in general.”  But, even if extrinsic evidence could be considered, that language referred to a specific claim that “ibuprofen interacts with fewer drugs than acetaminophen or that ibuprofen is comparable or superior to acetaminophen with respect to adverse drug-drug interactions.” And the Advil II court later used the terms Advil and ibuprofen interchangeably with respect to that claim.

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