Third Circuit gives Shire a tough pill to swallow

In Shire US Inc v Barr Laboratories Inc, the US Court of Appeals for the Third Circuit has affirmed a district court decision refusing to grant a preliminary injunction to the plaintiff on the grounds that the Maryland-based company did not establish that the trade dress of its Adderall pills was non-functional.

The case involved Barr Laboratories' generic version of Shire's Adderall, a central nervous system stimulant used in treating attention-deficit hyperactivity disorder. Shire offers Adderall in both blue and pale orange/peach colours, and round and oval shapes. The colour and size of the pills vary with the tablet strength. In February 2002 Barr introduced a generic bioequivalent to Adderall. Barr's generic tablets are available in blue and orange/peach shades, and are oval and convex in shape. Like Adderall, the size and colour of Barr's pills vary with their strength.

The New Jersey District Court denied Shire's motion, finding that the company had failed to carry its burden under the Lanham Act's Section 43(a) to establish that the appearance of its pills was non-functional. The Third Circuit, in affirming the lower court's ruling, looked to the definition of 'functionality', namely that a product feature is functional and, therefore, not protectable trade dress "if it is essential to the use or purpose of the article or if it affects the cost or quality of the article".

The appellate court found that the lower court had acted within its discretion in accepting expert testimony that the pills' similar colours and shapes aided patients in correctly managing their medication regimens and, therefore, improved patient safety. The appellate court was not significantly troubled by the fact that other district courts (and even Third Circuit decisions) had previously concluded that drug shape was non-functional. The court explained that its role was to evaluate the district court's conclusion under a clearly erroneous standard. In this case, there was sufficient evidence on the record to support the district court's decision on the functionality issue and, therefore, let it stand.

Timothy Kelly and Patricia Werner, Fitzpatrick Cella Harper & Scinto, New York

Get unlimited access to all WTR content