City of Philadelphia v. Chas. Pfizer & Co., 68 Civ. 4298

Citation345 F. Supp. 454
Decision Date31 May 1972
Docket NumberNo. 68 Civ. 4298,69 Civ. 4629.,68 Civ. 4299,68 Civ. 4298
PartiesCITY OF PHILADELPHIA and City of Detroit, Plaintiffs, v. CHAS. PFIZER & CO., Inc., et al., Defendants. FORT PIERCE MEMORIAL HOSPITAL, and Deborah Hospital on behalf of themselves and all others similarly situated, Plaintiffs, v. CHAS. PFIZER & CO., Inc., et al., Defendants. HAVERFORD HOSPITAL CORPORATION et al., Plaintiffs, v. CHAS. PFIZER & CO., Inc., et al., Defendants.
CourtUnited States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York

Harold E. Kohn, Philadelphia, Pa., for petitioners; Harold E. Kohn, P. A., David Berger, David Berger, P. A., Philadelphia, Pa., of counsel.

Dewey, Ballantine, Bushby, Palmer & Wood, New York City, for defendant Chas. Pfizer & Co., Inc.; J. Paul McGrath, New York City, of counsel.

Donovan, Leisure, Newton & Irvine, New York City, for defendant American Cyanamid Co.; Roy W. McDonald, New York City, of counsel.

Winthrop, Stimson, Putnam & Roberts, New York City, for defendant Bristol-Myers Co.; Merrell E. Clark, Jr., New York City, of counsel.

WYATT, District Judge.

This is a petition by Harold E. Kohn (and by other counsel associated with him), attorney for plaintiffs in these class actions, for an order approving a fee of $2,000,000, to be paid by defendants to Kohn and his associates. The petition is undated but was submitted in open Court on January 24, 1972 in the presence of counsel for defendants and was at that time ordered by me to be filed and docketed. Mr. Kohn and counsel for defendants were heard on that occasion. Decision on the petition was reserved.

Mr. Kohn is an experienced lawyer in antitrust matters; his office is in Philadelphia. He personally took the active part amongst the petitioners; he and his associate, Miss Korman (one of the petitioners) are known to me from their appearances before me; the other petitioners are not known to me and I am not personally aware of any relevant activity by them.

A "Supplement to Petition", also undated, was thereafter mailed to the Clerk and was received for filing on February 14, 1972.

The caption of the petition shows three civil actions in which Kohn represents the plaintiffs. Apparently, notice of the petition was given to defendants only. When the petition was heard, only defendants were represented and had been notified.

I. Commencement of the Actions Now Being Settled
A. Commencement of Actions Before Verdict in the Criminal Case

The extensive background of these three class actions and many similar actions need not be here reviewed in detail. It is described in my opinions in State of West Virginia v. Chas. Pfizer & Co., D.C., 314 F.Supp. 710, affirmed 2 Cir., 440 F.2d 1079 and in Hartford Hospital v. Chas. Pfizer & Co., D.C., 52 F.R.D. 131 (see on appeal from denial of motion to intervene, American Hospital Assn. v. Chas. Pfizer & Co., 2 Cir., 448 F.2d 790).

For present purposes, the history may begin with the filing on August 17, 1961 of an indictment in this District naming Pfizer, Cyanamid and Bristol as defendants (61 Cr. 772) along with some individuals, whose motions to dismiss were subsequently granted (United States v. Chas. Pfizer & Co., D.C., 245 F.Supp. 801). The indictment charged violation of the antitrust laws in respect of broad spectrum antibiotic drugs. It was some time before any civil claim was asserted against defendants. In time, however, many similar civil actions were commenced. All of these actions not commenced in this District were transferred here by the Judicial Panel on Multidistrict Litigation.

1.

In 1963, Premo Pharmaceutical Corporation (Premo), a drug business operating from New Jersey, began to import tetracycline from Italy. Pfizer on September 20, 1963 commenced an action for patent infringement against Premo in the United States District Court for the District of New Jersey (C.A. 766-63). Premo filed in that action a counterclaim asserting violation by Pfizer of the antitrust laws. Premo then retained a lawyer, Dennis, to assist patent counsel in prosecuting the counterclaim.

2.

In the following year, 1964, Premo was low bidder for sales of tetracycline to the City of New York but, since Pfizer had threatened the City with a patent infringement suit if it bought from Premo, the City in buying from Premo required Premo to post an indemnity bond. By this time, Dennis had become a partner in the law firm of Dickstein, Shapiro & Galligan. Premo consulted this firm in connection with the furnishing of the indemnity bond to the City.

In June 1964, Pfizer commenced an action in this Court against the City of New York and against the surety on Premo's indemnity bond; the complaint alleged infringement of the Conover patent. This is an action still pending (64 Civ. 1742).

The defendant City of New York retained as its counsel Dickstein, Shapiro & Galligan; on July 1, 1964, these lawyers filed an answer. This answer contained a counterclaim asserting a cause of action for treble damages against Pfizer, Cyanamid, Bristol, Squibb and Upjohn for violation of the antitrust laws. The counterclaim was based on the charges in the indictment and in substantial part is word for word copied from the indictment. The counterclaim did not set out any claim for a class. Mr. Shapiro and Mr. Galligan have not only been active in the City of New York action but, as will appear, have been active in many other actions involving antibiotic antitrust claims.

3.

It was some time before any claim similar to that of the City of New York was asserted against defendants. (On July 13, 1964, Premo commenced an action in this Court (64 Civ. 2163) against the defendants other than Pfizer.)

In November 1966, the Shapiro firm negotiated a settlement of the Premo litigation. A chief feature of the settlement was a license by Pfizer to Premo and two other companies to make, sell, etc. tetracycline. This license, according to Shapiro and as agreed implicitly by all other counsel for plaintiffs, marked the end of the claimed antitrust law violations.

4.

On August 4, 1967, the State of Texas commenced an action in the Northern District of Texas (CA 3-2165; after transfer here, 68 Civ. 4375). The Shapiro firm was of counsel. This was the first action commenced by a plaintiff to assert treble damage antitrust claims against defendants. It was a class action for the State of Texas and all cities, counties, and other political subdivisions in Texas which had bought antibiotics during the relevant period. (City, county, and state entities are, in the context of these actions, often called "CCS" entities and the actions are often called "CCS" actions.)

5.

In August 1967, Pfizer commenced a patent infringement action in the Central District of California (67-793-R; after transfer here, 68 Civ. 4541) against Benalen Corporation, a wholesale drug house. On August 24, 1967, Benalen filed an answer with a counterclaim for violation of the antitrust laws. The counterclaim as then filed did not state a claim for a class. On September 18, 1967, Benalen filed an amended counterclaim which did assert the antitrust claim for a class of all drug wholesalers in California who had bought and resold antibiotics at wholesale in the relevant period. This was the first civil antitrust claim asserted against defendants by a wholesale druggist. Counsel for Benalen have been Schwartz & Alschuler, for whom Benjamin F. Schwartz and Herbert A. Karzen have been principally engaged.

6.

On September 18, 1967, Domaro, a California retail druggist, commenced an action against defendants in the Central District of California (67-1366-R; after transfer here, 68 Civ. 4542). The Schwartz firm represented Domaro. The claim was stated for a class of all retail druggists in California who bought and resold antibiotics at retail in the relevant period. This was the first civil antitrust claim asserted against defendants by a retail drug store.

7.

On September 18, 1967, American Medical Enterprises, which had hospitals in California, commenced an action against defendants in the Central District of California (67-1365-R; after transfer here, 68 Civ. 4543). The Schwartz firm represented American Medical Enterprises. The claim was stated for a class of all private hospitals in California who bought and resold or dispensed antibiotics to their patients in the relevant period. This was the first civil antitrust claim asserted against defendants by a private hospital.

8.

On October 23, 1967, trial of the indictment began in this Court before Judge Frankel.

On October 25, 1967, the State of Florida commenced an action in this Court (67 Civ. 4143). The Shapiro firm was of counsel. The claim was for a class of all CCS entities in Florida which had bought antibiotics during the relevant period or had paid for antibiotics under welfare, old age or other relief programs.

On December 29, 1967, the jury brought in a verdict of guilty against the three defendants named in the indictment.

B. Commencement of Actions After Verdict in the Criminal Case Until the February 6, 1969 Settlement Offers of Defendants

9.

On January 9, 1968, the State of Wisconsin commenced an action in this Court (68 Civ. 91). The Shapiro firm was of counsel. The claim was for a class of all CCS entities in Wisconsin (including all entities supported in whole or part by state or local government funds) which had bought antibiotics during the relevant period or had paid for antibiotics under any welfare program.

10.

On January 17, 1968, the State of Iowa commenced an action in the Southern District of Iowa (8-2130-C-2; after transfer here, 68 Civ. 4297). The attorneys for Iowa were the Attorney General and two of his assistants. (After January 6, 1969, Iowa was represented by the Shapiro firm which filed a notice of appearance on that date.) No claim for a class was stated. Iowa claimed damages as a result of purchases of antibiotics by its universities, mental and other hospitals, and correctional...

To continue reading

Request your trial
16 cases
  • IN RE PENN CENT. SECURITIES LITIGATION
    • United States
    • U.S. District Court — Eastern District of Pennsylvania
    • 21 Junio 1976
    ...fee award be adjusted to reflect this. See Stanford Daily v. Zurcher, 64 F.R.D. 680, 683 (N.D.Cal.1974); City of Philadelphia v. Chas. Pfizer & Co., 345 F.Supp. 454, 484 (S.D.N.Y.1972); cf. Lindy, supra, 484 F.2d at It would be manifestly unjust to the Holding Company class to charge them t......
  • Folsom v. Butte County Assn. of Governments
    • United States
    • California Supreme Court
    • 28 Octubre 1982
    ... ... Flam, Yuba City, for plaintiffs and respondents ...         [32 Cal.3d 671] ... Norman v. McKee, 290 F.Supp. at 36. See also City of Philadelphia v. Charles Pfizer & Co., 345 F.Supp. 454, 470-471 (S.D.N.Y.1972). Rather, ... ...
  • City of Detroit v. Grinnell Corporation
    • United States
    • U.S. Court of Appeals — Second Circuit
    • 13 Marzo 1974
    ... ... Kronfeld, Philadelphia (Mesirov, Gelman, Jaffe & Levin and Anthony E. Creato, Philadelphia, Pa., of counsel), for ... Newman v. Stein, 464 F.2d 689 (2d Cir. 1972); West Virginia v. Chas. Pfizer & Co., 314 F.Supp. 710 (S. D.N.Y.1970), aff'd 440 F.2d 1079 (2d Cir.), cert. denied sub ... ...
  • Alpine Pharmacy, Inc. v. Chas. Pfizer & Co., Inc.
    • United States
    • U.S. Court of Appeals — Second Circuit
    • 2 Julio 1973
    ... ... and others by the Committee of Counsel ...         David I. Shapiro, New York City (James vanR. Springer, Washington, D. C., of counsel), for Dickstein, Shapiro & Galligan ...         Before SMITH, MULLIGAN and TIMBERS, ...         The general factors to be considered in awarding counsel fees were extensively reviewed by Judge Wyatt in City of Philadelphia v. Chas. Pfizer & Co., 345 F.Supp. 454, 482-483 (S.D.N.Y.1972), a discussion that was incorporated by reference into the opinion below. The antitrust ... ...
  • Request a trial to view additional results
1 books & journal articles
  • The Effectiveness of Private Enforcement and Class Actions to Secure Antitrust Enforcement
    • United States
    • Antitrust Bulletin No. 62-3, September 2017
    • 1 Septiembre 2017
    ...See,e.g., Trans World Airlines Inc. v. Hughees, 312 F. Supp. 478, 482 (S.D.N.Y. 1970); City of Philadelphia v. Chas.Pfizer & Co, Inc. 345 F. Supp. 454, 484 (S.D.N.Y. 1972).133. See,e.g., Fitzpatrick, supra note 114, at 832.134. See McDaniel v. County of Schenectady, 595 F.3d 411, 419 (2d Ci......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT