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IP Litigation

FDCA does not preempt California unfair competition law; nationwide injunction based solely on state law inappropriate

January 6, 2014

IP Litigation

FDCA does not preempt California unfair competition law; nationwide injunction based solely on state law inappropriate

January 6, 2014

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Fed. Cir. affirms determination that Federal Food, Drug, and Cosmetic Act (FDCA) does not preempt California’s unfair competition law (UCL), affirms grant of summary judgment of a UCL violation, and vacates and remands the grant of a nationwide injunction.

Allergan, Inc. v. Athena Cosmetics, Inc., ___ F. 3d ___ (Fed. Cir. Dec. 30, 2013) (Rader, MOORE, Wallach) (C.D. Cal.: Selna) (2 of 5 Stars)

Jurisdiction: Although the appeal did not present any patent issues, the Fed. Cir. had jurisdiction because the parties’ legal positions as to the patent claims were altered when the district court granted a stipulated summary judgment of non-infringement before the parties agreed to dismiss the patent claims without prejudice.

Preemption: The Fed. Cir. affirmed that the FDCA does not impliedly preempt Allergan’s UCL claim. There was no indication that Congress intended the FDCA to preempt state law causes of action regarding prescription drugs, such as that provided in the California Health Code and UCL, in contrast to non-prescription drugs and medical devices.

Summary Judgment: Rejecting Athena’s argument that its eyelash growth products are only cosmetics, the Fed. Cir. affirmed the summary judgment that Athena violated the UCL because it intended the products to be used as drugs.

Injunction: The Fed. Cir. vacated the district court’s nationwide permanent injunction, because California UCL does not support an injunction against activities outside of California and to do so would violate the Commerce Clause. The Fed Cir remanded with instructions to limit the scope of the injunction to conduct occurring within California.

 

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