Author: Guimarães de Lima e Silva, Valéria

Source: European Competition Journal, Volume 7, Number 3, December 2011 , pp. 455-503(49)

Publisher: Hart Publishing

Abstract:

Sham litigation is a practice whereby a competitor misuses the adjudicatory system for the purpose of preventing or delaying the entry of competing products in the market. As a consequence, consumers cannot benefit from a decrease of prices that would otherwise take place. The effects of this practice are even more harmful in the pharmaceutical sector, due to the essentiality of the products for the realisation of the fundamental human right to health. Consumers from both developed and developing countries are harmed, and the latter suffer more intensively the consequences because of inherent economic constraints. Although sham litigation is subject to antitrust laws, the existing test for its characterisation, as developed by the US Supreme Court, has such a high threshold that in practice precludes its repression. The paper scrutinises the parameters for the definition of sham litigation in the US, as well as conducts a critical and comparative analysis of this doctrine and its equivalents in the US, EU and Brazil. It demonstrates that other legal systems have found alternatives for the repression of the practice, avoiding the parameters and limitations of the US sham litigation test. The paper further considers the arguments that have been raised to justify the limitation of the doctrine, by confronting them against other rights. The role of intent in the current test is also criticised. The analysis leads to the conclusion that a modification in the current test adopted by US courts is not only feasible but rational, from the standpoint of fundamental rights, procedural law and competition law.

Document Type: Research article

DOI: http://dx.doi.org/10.5235/ecj.v7n3.455

Publication date: 2011-12-01

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• This scholarly, peer-reviewed publication of original articles and analysis of current developments in competition law is designed to complement and augment the existing literature with a special focus on European developments. Topics include:
  

  • Vertical and Conglomerate Mergers
  • Enlargement of the Union - the ramifications for Competition Policy
  • Unilateral and Coordinated Effects in Merger Control
  • Modernisation of European Competition law
  • Cartels and Leniency
  • Article 82- restatement or evolution?
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