United States: Federal Circuit Affirms That The ITC Cannot Investigate An FDCA Violation Without The FDA's Say-So

Last Updated: June 13 2019
Article by Aarti Shah and Rithika Kulathila

In Amarin Pharma, Inc. v. Int'l Trade Comm'n (18-1247), the Federal Circuit affirmed the International Trade Commission's ("ITC") finding that Amarin's false advertising claim under § 43(a) of the Lanham Act was precluded by the Federal Food, Drug, and Cosmetic Act ("FDCA") because these claims require the FDA's guidance on whether possible non-compliance of the provision is a violation of the FDCA.  The court also found that the Commission may decline to institute an investigation where there is no cognizable claim under § 337.  This case exemplifies how the ITC's jurisdiction over "unfair trade practices" is not just limited to patent cases but can also be extended to multiple types of unfair competition claims, though this jurisdiction is not without its limits.  Additionally, it reaffirms that the ITC may decline to institute investigations, and its decision to not institute an investigation would be subject to review by the Federal Circuit.

On August 30, 2017, Amarin filed a complaint with the ITC alleging a violation of § 337 of the Tariff Act under two bases.  First, Amarin alleged a violation under § 43(a) of the Lanham Act claiming that respondents' advertisements and labeling of its products as "dietary supplements" was literally false.  Amarin explained that respondents' products were instead unapproved "new drugs" under the FDCA and not "dietary supplements" as defined under the FDCA.  Second, Amarin alleged that importation and sale of respondents' falsely labeled products constitutes an unfair act or unfair method under § 337 because products are "misbranded drugs" which violate standards enumerated in the FDCA.  On October 27, 2017, the Commission declined to institute an investigation, saying that Amarin's allegations were precluded by the FDCA. Amarin then appealed the ITC's decision to the Federal Circuit arguing: (1) the Federal Circuit had jurisdiction to review the Commission's decision not to institute an investigation, (2) the Commission has a mandatory duty to institute an investigation when the complaint was filed under oath (see 19 U.S.C. § 1337(b)(1)), and (3) Amarin's claims were not precluded by the FDCA.

The Federal Circuit began its opinion by stating that it has appellate jurisdiction to review the ITC's final determinations.  The Federal Circuit then held that on the facts presented, the Commission's decision not to institute was "intrinsically" a final decision because it was based on the merits of the claim: Amarin's claims were precluded by the FDCA.  Therefore the Commission's decision not to institute an investigation was intrinsically a final determination that denied Amarin relief under § 337(d) and (f).

Second, the Federal Circuit held that the Commission may decline to institute an investigation when it determines the complaint failed to state a cognizable claim under § 337.  The Federal Circuit found that because Amarin's claims were entirely based on the FDCA and the FDA has not provided guidance as to whether respondents' conduct constitutes a violation of the FDCA, Amarin's claims were precluded.  Amarin therefore failed to state a cognizable claim under § 337.  As a result, the Commission had discretion to decline to institute the investigation because Amarin failed to state a cognizable claim under § 337.  Interestingly, the Federal Circuit did not ultimately make a more broadly applicable statement on whether the Commission generally has discretion to not institute investigations when complaints are submitted.

Lastly, the Federal Circuit held that Amarin's Lanham Act and Tariff Act claims were precluded because these claims depend on litigating an alleged FDCA violation without guidance from the FDA.  The FDCA provides statutory authorization to the FDA that allows it to regulate drugs and dietary supplements.  As observed by the Supreme Court in POM Wonderful LLC v. Coca-Cola Co., under the FDCA the Federal Government is authorized to file suit for noncompliance, not private parties.  This lack of a private right to enforce FDCA violations has therefore limited when private parties can assert false advertising and unfair competition claims under § 43(a) of the Lanham Act.  The Federal Circuit was quick to note that not all claims arising under the FDCA would be barred.  Where affirmative FDA approval is required or the FDA takes a position that some products violate the FDCA, a Lanham Act claim may not be barred.  Here, however, affirmative FDA approval is not required for dietary supplements and the FDA has not provided guidance as to whether respondents' products would be considered "new drugs" that require approval.  Accordingly, Amarin's claims are precluded by the FDCA and no valid § 337 claim exists.

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