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Posted On: 08/22/2019 4:17:36 PM
Post# of 11802
Re: nonsequetor #7571
https://caselaw.findlaw.com/us-9th-circuit/1122929.html
This case is about one of one hundred that Lifescan stirs up, almost always against small former distributors. These cases are not unique to Lifescan, Abbott has many themselves. In industry jargon they are known as product diversion cases.
KB has a good friend in NJ who was involved in one of these cases against Lifescan some years back, during the height of Lifescan's market leadership. He beat Lifescan, who had previously frozen his bank account, and had his account with McKesson closed, because at an Arbitration Lifescan had to say that they found this damning diversion information out through the employment of ghost shoppers and had no first hand or documentary knowledge.
All of these diversion cases, and they are a huge deal in the diabetic test strip market, are conditioned on a famous ruling in 1976, Abbott vs. City of Portland, where a now long dead judge believed that test strips were controlled substances, and therefore all commerce (including discounts) were governed by laws involving drugs, in particular controlled substances. The law is still used as a cite over 40 years later. Some $5.6 billion later in legal fees, the bad ruling still allows diversion complaints to at least pass the smell test.
In the case above, if Lifescan believed they would win in Arbitration, they would have paid the fees. But, since they have historically lost 95% of the diversion cases, Lifescan did what all scumbag companies do, they took a victory on a technicality. Now its been reversed.
This case is about one of one hundred that Lifescan stirs up, almost always against small former distributors. These cases are not unique to Lifescan, Abbott has many themselves. In industry jargon they are known as product diversion cases.
KB has a good friend in NJ who was involved in one of these cases against Lifescan some years back, during the height of Lifescan's market leadership. He beat Lifescan, who had previously frozen his bank account, and had his account with McKesson closed, because at an Arbitration Lifescan had to say that they found this damning diversion information out through the employment of ghost shoppers and had no first hand or documentary knowledge.
All of these diversion cases, and they are a huge deal in the diabetic test strip market, are conditioned on a famous ruling in 1976, Abbott vs. City of Portland, where a now long dead judge believed that test strips were controlled substances, and therefore all commerce (including discounts) were governed by laws involving drugs, in particular controlled substances. The law is still used as a cite over 40 years later. Some $5.6 billion later in legal fees, the bad ruling still allows diversion complaints to at least pass the smell test.
In the case above, if Lifescan believed they would win in Arbitration, they would have paid the fees. But, since they have historically lost 95% of the diversion cases, Lifescan did what all scumbag companies do, they took a victory on a technicality. Now its been reversed.
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