In CASE 16.1 Federal Trade Commission v.Actavis,Inc.(2013),Actavis sought to market a generic version of AndroGel,which was owned by Solvay.The parties entered into a settlement agreement which required Solvay to pay Actavis millions as compensation for "other services." The FTC sued all parties,alleging violations of the Sherman Act.The caseinvolved a question of whether __________ should be analyzedunder the __________ standard.
A) reverse payment settlements, rule of reason
B) vertical conspiracy, rule of reason
C) horizontal conspiracy, rule of reason
D) group boycotts, per se

Question

Quizplus · Accepted Answer

The case involved a settlement agreement between Solvay and Actavis that included compensation for "other services." This type of settlement is known as a reverse payment settlement, where a patent holder pays a potential generic competitor to delay entry into the market. This practice has been subject to antitrust scrutiny, and courts have applied the rule of reason standard to analyze whether such agreements violate the Sherman Act.