Justia Mergers & Acquisitions Opinion Summaries
Articles Posted in Health Law
INSULET CORP. v. EOFLOW, CO. LTD.
Insulet Corp. and EOFlow are medical device manufacturers that produce insulin pump patches. Insulet began developing its OmniPod product in the early 2000s, and EOFlow started developing its EOPatch product after its founding in 2011. Around the same time, four former Insulet employees joined EOFlow. In 2023, reports surfaced that Medtronic had started a process to acquire EOFlow. Soon after, Insulet sued EOFlow for violations of the Defend Trade Secrets Act (DTSA), seeking a temporary restraining order and a preliminary injunction to enjoin all technical communications between EOFlow and Medtronic in view of its trade secrets claims.The U.S. District Court for the District of Massachusetts temporarily restrained EOFlow from disclosing products or manufacturing technical information related to the EOPatch or OmniPod products. The court then granted Insulet’s request for a preliminary injunction, finding strong evidence that Insulet is likely to succeed on the merits of its trade secrets claim, strong evidence of misappropriation, and that irreparable harm to Insulet crystallized when EOFlow announced an intended acquisition by Medtronic. The injunction enjoined EOFlow from manufacturing, marketing, or selling any product that was designed, developed, or manufactured, in whole or in part, using or relying on alleged trade secrets of Insulet.The United States Court of Appeals for the Federal Circuit reversed the district court’s order. The court found that the district court had failed to address the statute of limitations, lacked a tailored analysis as to what specific information actually constituted a trade secret, and found it hard to tell what subset of that information was likely to have been misappropriated by EOFlow. The court also found that the district court had failed to meaningfully engage with the public interest prong. The court concluded that Insulet had not shown a likelihood of success on the merits and other factors for a preliminary injunction. The case was remanded for further proceedings consistent with the opinion. View "INSULET CORP. v. EOFLOW, CO. LTD. " on Justia Law
United States v. Anthem
The court affirmed the issuance of a permanent injunction enjoining the merger of Anthem and Cigna under Section 7 of the Clayton Act, 15 U.S.C. 18. The court held that the district court did not abuse its discretion in enjoining the merger based on Anthem's failure to show the kind of extraordinary efficiencies necessary to offset the conceded anticompetitive effect of the merger in the fourteen Anthem states: the loss of Cigna, an innovative competitor in a highly concentrated market. The court also held that the district court did not abuse its discretion in enjoining the merger based on its separate and independent determination that the merger would have a substantial anticompetitive effect in the Richmond, Virginia large group employer market. View "United States v. Anthem" on Justia Law
Pinnacle Health Hospitals v. Sebelius
In 1995, two non-profit hospitals consolidated to form Pinnacle. Pinnacle subsequently submitted a Medicare reimbursement claim for the losses the hospitals had incurred through the sale of their depreciable assets in the consolidation. The Administrator denied Pinnacle's claim, and that order became the final decision of the Secretary. On Pinnacle's Administrative Procedure Act (APA), 42 U.S.C. 12101 et seq., challenge, the district court upheld the Secretary's decision in full. Because the Secretary's interpretation of the relevant Medicare regulations was not plainly erroneous or inconsistent with the regulation, the court concluded that the Secretary reasonably applied the bona fide sale requirement to a reimbursement request from a participant in a "statutory merger." The court also held that the Secretary's finding that the bona fide sale requirement applied to consolidations involving non-profit Medicare providers, like Pinnacle, was not plainly erroneous or inconsistent with the regulation. Finally, substantial evidence supported the Secretary's finding that Pinnacle did not satisfy the bona fide sale requirement. Accordingly, the court affirmed the district court's judgment. View "Pinnacle Health Hospitals v. Sebelius" on Justia Law
Forsyth Memorial Hospital, Inc, et al v. Kathleen Sebelius
Forsyth Memorial Hospital, Inc. and other providers (collectively "appellants") appealed the district court's grant of summary judgment in favor of the Secretary of Health and Human Services ("HHS") upholding the denial of their reimbursement claims arising from the merger of Presbyterian Health Services Corporation ("Presbyterian") and Carolina Medicorp, Inc. ("Carolina"). At issue was whether the denial of the reimbursement claims was arbitrary and capricious, an abuse of discretion, contrary to law, or unsupported by substantial evidence. The court affirmed the denial of the reimbursement claims and held that the district court properly concluded that it was neither arbitrary and capricious nor contrary to law for the Administrator of the Centers for Medicare & Medicaid Services ("Administrator") to find that appellants were not entitled to reimbursement where, in the merger between Carolina and Presbyterian, no bona fide sale took place and the parties were related.View "Forsyth Memorial Hospital, Inc, et al v. Kathleen Sebelius" on Justia Law
PharmAthene, Inc. v. SIGA Technologies, Inc.
This action arose out of a dispute between two companies involved in the development of pharmaceuticals. Plaintiff was a biodefense company engaged in the development and commercialization of medical countermeasures against biological and chemical weapons and defendant was also a biodefense company that concentrated on the discovery and development of oral antiviral and antibacterial drugs to treat, prevent, and complement vaccines for high-threat biowarfare agents. The court rejected plaintiff's claim that defendant breached a binding license agreement, but found that defendant did breach its obligations to negotiate in good faith and that defendant was liable to plaintiff under the doctrine of promissory estoppel. The court rejected defendant's claim that plaintiff breached its obligation to negotiate in good faith. The court denied plaintiff's claims for specific performance of a license agreement with the terms set forth in the time sheet or, alternatively, for a lump sum award of its expectation damages. The court concluded, however, that plaintiff was entitled to share in any profits relied on from the sale of the drug in question, after an adjustment for the upfront payments it likely would have had to make had the parties negotiated in good faith a license agreement in accordance with the terms of the term sheet. In addition, plaintiff was entitled to recover from defendant a portion of the attorneys' fees and expenses plaintiff incurred in pursuing the action. View "PharmAthene, Inc. v. SIGA Technologies, Inc." on Justia Law