Tevra Brands LLC v. Bayer HealthCare LLC
- Beth Freeman
- 5:19-cv-04312
- U.S. District Court · Northern District of California
- 16
In Tevra Brands v. Bayer HealthCare, Judge Freeman denied Tevra’s motion and granted Bayer’s motion in part and denied it in part.
Tevra Brands LLC and Bayer HealthCare LLC, particularly their ability to present the challenged expert testimony at trial.
What happened
Tevra Brands LLC sued Bayer HealthCare LLC under federal antitrust laws, alleging that Bayer used exclusionary practices in the market for topical flea and tick treatments. The court considered whether to exclude testimony from experts Dr. Saravia and Dr. Wong.
The court denied Tevra’s request to exclude Dr. Saravia’s relevant-market opinion. It granted Bayer’s request in part and denied it in part as to Dr. Wong’s opinions: some parts of his damages and consumer-harm testimony were excluded, while other opinions could be offered.
Judge Beth Labson Freeman ruled that Dr. Wong could use his Frontline Method but could not testify that Tevra would have captured 100% of additional sales. The court denied as moot Bayer’s challenge to the Projection Method, partly granted and partly denied its challenge to the Consumer Harm opinion, and denied its challenge to Dr. Wong’s relevant-market opinions.
The detailed version
- Tevra Brands LLC v. Bayer HealthCare LLC · No. 5:19-cv-04312
- Beth Freeman
- May 16, 2024
Background
Tevra Brands LLC brought an antitrust action against Bayer HealthCare LLC, alleging exclusionary practices that substantially restrained trade in the market for topical imidacloprid flea and tick treatments for dogs and cats. Tevra’s three claims allege violations of Sections 1 and 2 of the Sherman Act and Section 3 of the Clayton Act.
The court considered two motions to exclude expert testimony under Federal Rule of Evidence 702, which permits qualified experts to testify when their opinions are relevant and based on sufficient facts, reliable methods, and a reliable application of those methods. Under the Supreme Court’s decision in Daubert, the judge acts as a gatekeeper for expert evidence; challenges that go only to the strength of admissible evidence generally can be addressed through cross-examination.
Tevra’s Motion to Exclude Dr. Saravia
Tevra sought to exclude Dr. Saravia’s opinions about the relevant market. Tevra argued that Dr. Saravia proposed inconsistent market definitions, lacked a reliable basis such as a hypothetical-monopolist or small-but-significant-and-nontransitory-price-increase test, and did not rely on verifiable empirical evidence.
The court rejected those arguments. It found that Dr. Saravia could identify alternative markets while serving as a rebuttal expert and that her analysis relied on a customer survey, calculations based on available data, company and industry documents, and information about how customers and sellers responded to price changes. The court concluded that it was more likely than not that her relevant-market opinion was reliable. Tevra’s motion to exclude Dr. Saravia’s relevant-market opinion was DENIED.
Bayer’s Motion to Exclude Dr. Wong
Bayer challenged four categories of Dr. Wong’s opinions: his “Frontline Method” damages calculation, his “Projection Method,” his consumer-harm opinion, and his relevant-market opinions.
Frontline Method. Dr. Wong used sales of generic fipronil products as a comparison to estimate sales of generic imidacloprid products that might have occurred without Bayer’s exclusivity agreements. The court found the first part of this method sufficiently reliable because Dr. Wong addressed differences between the two product markets. Those differences could be explored through cross-examination.
The court reached a different conclusion about Dr. Wong’s assumption that Tevra would have captured 100% of the additional generic imidacloprid sales. It found that this assumption was unsupported by the evidence, including Tevra’s competition, pricing, and position in the market. Bayer’s motion to exclude the Frontline Method opinion was GRANTED IN PART AND DENIED IN PART. Dr. Wong may offer opinions based on the Frontline Method, but he may not offer opinions that Tevra would have captured 100% of the “excess units” from 2017 to 2023.
Projection Method. Tevra agreed that it would withdraw Dr. Wong’s Projection Method opinion, and Bayer agreed. Bayer’s motion to exclude that opinion was DENIED AS MOOT because the opinion will not be offered at trial.
Consumer Harm opinion. Dr. Wong estimated that consumer harm could exceed $214 million from 2017 to 2023. The court allowed Dr. Wong to offer a general opinion about harm to consumers, finding that such evidence could be relevant to Tevra’s response to Bayer’s procompetitive justifications. But the court excluded the specific $214 million estimate under Rule 403 because it added little value to the issues at trial and risked causing the jury to award a higher damages amount, even though Dr. Wong did not use that estimate to calculate Tevra’s damages. Bayer’s motion concerning the Consumer Harm opinion was GRANTED IN PART AND DENIED IN PART.
Relevant-market opinions. The court relied on its earlier summary-judgment ruling and again found that Dr. Wong’s relevant-market opinions were more likely than not reliable. Bayer’s motion to exclude those opinions was DENIED.
Disposition
The court denied Tevra’s motion to exclude Dr. Saravia’s relevant-market opinion. It granted in part and denied in part Bayer’s motion concerning Dr. Wong’s Frontline Method and Consumer Harm opinion, denied as moot Bayer’s motion concerning the Projection Method, and denied Bayer’s motion concerning Dr. Wong’s relevant-market opinions.
Read the full 16-page opinion on CourtListener, the free public archive maintained by the Free Law Project.