Astra USA, Inc., et al. v. County of Santa Clara

Case Details

Status: Victory
Docket No: 09-1273
Recusals: Kagan
U.S. Chamber Litigation Center Involvement: Petitioner
Solicitor General Involvement: Petitioner
Sub-Industry: Pharmaceuticals
Term: 2010 Term
Oral Argument Date: January 19, 2011
Vote: 8-0
Opinion: Ginsburg

Question(s) Presented

Whether, in the absence of a private right of action to enforce a statute, federal courts have the federal common law authority to confer a private right of action simply because the statutory requirement sought to be enforced is embodied in a contract.

U.S. Chamber's Position

NCLC urged the Supreme Court to reverse a Ninth Circuit decision that a private plaintiff, as a third party beneficiary, may sue on a government contract when no private right of action has been conferred by the statute governing the contract. In this case, the County of Santa Clara alleges its medical clinics were overcharged by Astra USA for pharmaceuticals covered by a federal drug-discounting program. In its brief, NCLC argued that the Ninth Circuit's decision is erroneous as the Supreme Court has never used federal common law to enforce federal statutes lacking a private right of action. NCLC warned that if the decision is allowed to stand, companies that do business with the government would be exposed to burdensome and expensive litigation with the possibility of significant liability.

Previously, NCLC filed an amicus brief urging the Supreme Court to grant certiorari.

Case Outcome

The Supreme Court reversed the Ninth Circuit's ruling that a private plaintiff, as a third party beneficiary, may sue on a government contract when no private right of action has been conferred by the statute governing the contract. The Supreme Court found that suits by 340B entities [including public hospitals, private clinics, and other health centers] to enforce ceiling-price contracts running between drug manufacturers and the Secretary of HHS are incompatible with the statutory regime. 

Justices in Majority
Alito
Breyer
Ginsburg
Kennedy
Roberts
Scalia
Sotomayor
Thomas
Procedural History

Amicus brief supporting certiorari filed 5/20/10. Cert. granted 9/28/10. Amicus brief on merits filed 11/19/10. Moot court held 1/10/11. Decided 3/29/11.

Case Documents