Federal Trade Commission v. Endo Pharmaceuticals Inc., Et Al .

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued May 1, 2023 Decided August 25, 2023
No. 22-5137
FEDERAL TRADE COMMISSION ,
APPELLANT
v.
ENDO PHARMACEUTICALS I NC., ET AL .,
APPELLEES
Appeal from the United States District Court
for the District of Columbia
(No. 1:21-cv-00217)
Mark S. Hegedus, Attorney, Federal Trade Commission,
argued the cause for appellant. With him on the briefs were
Anisha S. Dasgupta, General Counsel, and Joel Marcus,
Deputy General Counsel.
George G. Gordon argued the cause for appellees Endo
Pharmaceuticals Inc., et al. With him on the brief were Michael
H. McGinley, Julia Chapman, and John P. McClam.
Jay P. Lefkowitz argued the cause for appellees Impax
Laboratories, LLC, et al. With him on the brief were Devora
W. Allon, Kevin Neylan, and James R.P. Hileman. Evelyn

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Blacklock entered an appearance.
Before: S RINIVASAN , Chief Judge, M ILLETT and CHILDS ,
Circuit Judges.
Opinion for the Court filed by Circuit Judge CHILDS .
CHILDS , Circuit Judge: The Federal Trade Commission
Act, 15 U.S.C. §§ 41–58 (FTC Act), authorizes the Federal
Trade Commission (the Commission) to investigate and
prevent “unfair methods of competition” that affect commerce,
see id. § 45(a)(2). In this matter, the Commission appeals the
district court’s dismissal of claims against pharmaceutical
manufacturers for violations of §§ 1 and 2 of the Sherman Act.
Id. §§ 1, 2. The district court dismissed the action against
Appellees Endo Pharmaceuticals Inc. (Endo), its parent, Endo
International plc (Endo International), Impax Laboratories,
LLC (Impax), and its parent, Amneal Pharmaceuticals, Inc.
(Amneal) (collectively Appellees) for failure to state a claim
because a single patentee granting an exclusive license is
conduct protected and allowed under the Patent Act. 35 U.S.C.
§ 261; see FTC v. Endo Pharms. Inc., 596 F. Supp. 3d 115,
125–30 (D.D.C. 2022). For the reasons that follow, we affirm
the district court’s dismissal of the Commission’s claims.
I.
Congress has the power “[t]o promote the Progress of
Science and useful Arts, by securing for limited Times to
Authors and Inventors the exclusive Right to their respective
Writings and Discoveries.” U.S. Const. art. I, § 8, cl. 8.
Pursuant to that authority, Congress enacted the Patent Act
that, inter alia, grants patentees a twenty-year “right to exclude
others from making, using, offering for sale, or selling the[ir]
invention,” 35 U.S.C. § 154(a)(1), and the ability to “grant and

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convey an exclusive right under [their] application for patent,
or patents, to the whole or any specified part of the United
States,” id. § 261.
Nearly a century later, Congress enacted the Sherman Act.
Section 1 declares as illegal “[e]very contract, combination in
the form of trust or otherwise, or conspiracy, in restraint of
trade or commerce among the several States.” 15 U.S.C. § 1.
Section 1 is interpreted to outlaw “unreasonable restraints” on
trade. Ohio v. Am. Express Co., 138 S. Ct. 2274, 2283 (2018)
(quoting State Oil Co. v. Khan, 522 U.S. 3, 10 (1997))
(formatting modified). To plead a claim under § 1, a plaintiff
must allege: (1) the existence of an agreement; and (2) that the
agreement unreasonably restrains trade. See Am. Needle, Inc.
v. NFL, 560 U.S. 183, 190 (2010) (citations omitted).
Section 2 of the Sherman Act declares it a felony for a
person to “monopolize, or attempt to monopolize, or combine
or conspire with any other person or persons, to monopolize
any part of the trade or commerce among the several States, or
with foreign nations.” 15 U.S.C. § 2. To plead a claim under
§ 2, a plaintiff must allege: “(1) the possession of monopoly
power in the relevant market and (2) the willful acquisition or
maintenance of that power as distinguished from growth or
development as a consequence of a superior product, business
acumen, or historic accident.” United States v. Grinnell Corp.,
384 U.S. 563, 570–71 (1966).
II.
Because this case arises on a motion to dismiss, the
following background is derived from the Commission’s
complaint and the documents it incorporates by reference. See
Lewis v. Mutond, 918 F.3d 142, 144 (D.C. Cir. 2019) (citing
Scandinavian Satellite Sys., AS v. Prime TV Ltd., 291 F.3d 839,

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844 (D.C. Cir. 2002)); EEOC v. St. Francis Xavier Parochial
Sch., 117 F.3d 621, 624–25 (D.C. Cir. 1997).
Endo develops, manufactures, markets, and distributes
prescription pharmaceutical products. It holds several patents
covering a long-acting or extended-release (ER) version of the
semi-synthetic opioid oxymorphone sold under the brand name
Opana ER. Oxymorphone provides “relief of moderate to
severe pain in patients requiring continuous, around-the-clock
opioid treatment for an extended period of time.” Compl. ¶ 18
(J.A. 19).
In 2006, Endo began selling Opana ER and continued to
sell the drug until 2017 with success. In its inaugural year,
Opana ER generated revenues of less than $7 million. That
increased to $384 million in 2011, and $159 million in 2016.
In 2007, Impax decided to market its own generic version
of Opana ER and sought approval from the Federal Drug
Administration (FDA). In its Abbreviated New Drug
Application to the FDA, Impax certified that its generic drug
would not infringe on Endo’s Opana ER patents and that
Endo’s patents were invalid. See Teva Pharms. USA, Inc. v.
Sebelius, 595 F.3d 1303, 1305 (D.C. Cir. 2010) (“After a new
drug hits the market, [prospective generic competitors] can
effectively challenge the brand maker . . . by filing a
certification that a proposed generic version of the brand drug
would not run afoul of one (or more) of the . . . blocking
patents, either because the patent is invalid or because the
generic maker has found a way to design around it.” (citation
omitted)). Endo responded to Impax’s FDA certification by
filing a patent infringement action in January 2008.
After two and a half years of litigation, Endo and Impax
settled their patent infringement action (the 2010 Agreement).

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That agreement did three things of note. First, Impax agreed
that it would not sell its generic Opana ER until a
“Commencement Date” in January 2013. 2010 Agreement §
3.2 (J.A. 49). Second, the Agreement conveyed a license from
Endo to Impax to cover all of Endo’s patents involved in
manufacturing, selling, and marketing of generic Opana ER,
including patents acquired after the agreement became
effective. Id. § 4.1(a) (J.A. 51). Finally, after the expiration of
an “Exclusivity Period,” the 2010 Agreement contemplated
that Impax and Endo would “negotiate in good faith an
amendment to the terms of the License to any patents which
issue from any Pending Applications.” Id. § 4.1(d) (J.A. 53).
Starting in 2012, purportedly to prevent abuse of Opana
ER, Endo launched a replacement “crush resistant”
Reformulated Opana ER, which would not be covered by its
agreement with Impax and stopped selling Opana ER. Also,
beginning in 2012, “Endo developed or acquired the rights to
several additional patents related to Opana ER,” Compl. ¶ 44
(J.A. 24), and began asserting its patent rights against other
generic oxymorphone sellers, id. ¶ 49 (J.A. 24).
In 2013, in accordance with the 2010 Agreement, Impax
started selling its generic ER version of oxymorphone.
Impax’s generic oxymorphone helped create a competitive
environment that lowered the price of ER oxymorphone. After
successfully obtaining injunctions in patent infringement cases
it litigated, Endo was left with only Impax as a competitor
legally capable of selling generic oxymorphone ER.
In October 2015, Endo asked Impax to pay an eighty-five
percent royalty on the license for additional Opana ER patents.
When Impax refused this request, Endo sued Impax for breach
of the 2010 Agreement. While litigation with Impax was
ongoing, Endo faced FDA scrutiny because of new information

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that linked Reformulated Opana ER to intravenous drug abuse
and Endo decided to remove the drug from the market. A few
months later, after unsuccessfully attempting to get the contract
action dismissed, Impax reached a settlement with Endo (the
2017 Agreement) which “clarifie[d]” Impax’s license to all of
Endo’s Opana ER patents in exchange for a monetary payment
in addition to a percentage of royalties relating to Impax’s gross
oxymorphone ER profits. Compl. ¶ 92 (J.A. 33). Impax and
Endo also agreed that Impax’s obligation to pay royalties
would terminate if Endo took various actions, such as using its
own patents to enter the oxymorphone ER market.
Considering those terms, the district court found that Impax
had functionally “paid Endo for the exclusive right to use the
patent licenses for oxymorphone ER,” and that even if the
terms of the agreement left room for an “option to compete,”
the Commission had “plausibly alleged an exclusive licensing
agreement and a patent monopoly.” Endo Pharms. Inc., 596 F.
Supp. 3d at 123–24 (capitalization altered).
With the 2017 Agreement, Endo tabled a possible relaunch
of Opana ER and closed the door on any potential plans to
license its oxymorphone ER patents to any other companies.
After Endo’s market exit, there was an increase in the average
price of a 40 mg tablet of oxymorphone ER. Compl. ¶ 106
(J.A. 35). In light of these results, the Commission determined
that the 2017 Agreement was anticompetitive and harmful to
consumers and filed a complaint for injunctive and other
equitable relief against Appellees. The Commission alleged
that (1) Appellees’ 2017 Agreement violated § 1 of the
Sherman Act and it constituted an unfair method of
competition in violation of § 5(a) of the FTC Act, 15 U.S.C.
§ 45(a); and that (2) Amneal exercised monopoly power in
violation of § 2 of the Sherman Act and § 5(a) of the FTC Act.
Appellees moved to dismiss the Commission’s complaint for
failure to state a claim. Endo International also moved to

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dismiss for lack of personal jurisdiction. The district court
dismissed the action, without addressing the jurisdictional
issue. Endo Pharms. Inc., 596 F. Supp. 3d at 130.
The Commission timely appealed.
III.
A.
First, we answer whether this court has appellate
jurisdiction over this appeal. We conclude that we do.
On August 16, 2022, while this appeal was pending, Endo,
Endo International, and their affiliated companies filed a
voluntary petition for bankruptcy under Title 11 of the United
States Bankruptcy Code, 11 U.S.C. §§ 101–1532, in the United
States Bankruptcy Court for the Southern District of New
York. See In re Endo Int’l plc, No. 22-22549-jlg (Bankr.
S.D.N.Y. Aug. 16, 2022). After Endo filed a notice of
suggestion of bankruptcy and automatic stay of proceedings,
see FTC v. Endo. Pharms. Inc., No. 22-5137, Doc. No.
1959770 (D.C. Cir. filed Aug. 17, 2022), this court ordered the
parties to “address in their briefs whether [it] had jurisdiction
over this appeal.” Id. at Doc. No. 1970176 (D.C. Cir. filed Oct.
24, 2022). While Endo did not take a position regarding “the
applicability of the Bankruptcy Code’s automatic stay to the
instant appeal,” Endo Br. 1 n.1, both the Commission and
Impax contend that this court has jurisdiction pursuant to the
government action or regulatory power exception to the
Bankruptcy Code’s automatic stay provision. Impax Br. 44;
Comm’n Br. 22–23.
A party’s filing for bankruptcy generally triggers an
automatic stay of any “commencement or continuation . . . of a

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judicial . . . proceeding against the debtor.” 11 U.S.C.
§ 362(a)(1). If it applies, the automatic stay strips this court of
jurisdiction. In re Kupperstein, 994 F.3d 673, 677 (1st Cir.
2021) (“[T]he stay forbids judicial proceedings against the
debtor to progress.”); Chao v. Hospital Staffing Servs., Inc.,
270 F.3d 374, 382 (6th Cir. 2001). “But Congress excluded
certain actions from the automatic stay, including actions by ‘a
governmental unit’ intended ‘to enforce such governmental
unit’s . . . police and regulatory power.’” Wallaesa v. FAA, 824
F.3d 1071, 1076 n.3 (D.C. Cir. 2016) (quoting 11 U.S.C.
§ 362(b)(4)). “To determine if the regulatory power exception
applies, we evaluate whether the government’s action is to
effectuate a ‘public policy’ or to further its own ‘pecuniary
interest.’” In re Kupperstein, 994 F.3d at 677 (citations
omitted); see also 11 U.S.C. § 362(b)(4). “If ‘the governmental
action is designed primarily to protect the public safety and
welfare,’ then it passes the ‘public policy’ test and is excepted
from the automatic stay.” In re Kupperstein, 994 F.3d at 677
(internal quotation marks and citation omitted). “In contrast, if
the government is attempting to proceed against the debtor for
a ‘pecuniary purpose,’ that is, ‘to recover property from the
estate,’ the police power exception offers no shelter and the
proceeding is stayed.” Id. at 678 (citation omitted).
The Commission initiated the instant litigation “to prevent
unfair methods of competition,” Compl. 1 (J.A. 14), which it is
authorized to do if the competition is against public policy, see
Butterick Pub. Co. v. FTC, 85 F.2d 522, 526 (2d Cir. 1936)
(citing FTC v. Klesner, 280 U.S. 19 (1929)). See also Apple
Inc. v. Pepper, 139 S. Ct. 1514, 1525 (2019) (“‘[P]rotecting
consumers from monopoly prices’ has been ‘the central
concern of antitrust.’” (quoting 2A Areeda & Hovenkamp §
345)). In addition, the Commission is not requesting monetary
relief. Based on the Commission’s express purpose for this

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litigation, we conclude that the regulatory power exception to
the automatic stay is applicable to this proceeding.
B.
We next consider whether the district court erred in
dismissing the Commission’s claims. We conclude that it did
not.
The court reviews de novo the district court’s dismissal for
failure to state a claim upon which relief can be granted. See
Stewart v. Nat’l Educ. Ass’n, 471 F.3d 169, 173 (D.C. Cir.
2006) (citing Barr v. Clinton, 370 F.3d 1196, 1201 (D.C. Cir.
2004)).
“To survive a motion to dismiss, a complaint must have
‘facial plausibility,’ meaning it must ‘plead[ ] factual content
that allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.’” Hettinga v.
United States, 677 F.3d 471, 476 (D.C. Cir. 2012) (quoting
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). “In evaluating a
Rule 12(b)(6) motion, the Court must construe the complaint
‘in favor of the plaintiff, who must be granted the benefit of all
inferences that can be derived from the facts alleged.’” Id.
(quoting Schuler v. United States, 617 F.2d 605, 608 (D.C. Cir.
1979)). “Factual allegations, although assumed to be true, must
still ‘be enough to raise a right to relief above the speculative
level.’” Id. (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544,
555 (2007)). “But the Court need not accept inferences drawn
by plaintiff if those inferences are not supported by the facts set
out in the complaint, nor must the court accept legal
conclusions cast as factual allegations.” Id. (citing Kowal v.
MCI Commc’ns Corp., 16 F.3d 1271, 1276 (D.C. Cir. 1994)).

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In its complaint, the Commission alleged that Endo and
Impax, through their 2017 Agreement, violated Sherman Act
§§ 1 and 2 by creating an impermissibly anticompetitive
exclusive licensing arrangement, which resulted in the
monopolization of profits and denial of the benefits of
competition to consumers. Now on appeal, the Commission
argues that it sufficiently pleaded violations of §§ 1 and 2 of
the Sherman Act because it alleged that Impax had sufficient
market power, and that the 2017 Agreement harms competition
by removing a market competitor, causing the loss of price
competition, and reducing innovation. Endo responds that the
district court’s decision to dismiss the Commission’s Sherman
Act claims should be affirmed because the Commission failed
to allege conduct exceeding the scope of what the Patent Act
authorizes thereby making antitrust scrutiny unwarranted.
Impax agrees with Endo stating that affirmance of the district
court is required because the law allows a single patentee and
its single licensee to agree to allocate exclusively the benefits
of valid and repeatedly tested patent rights that are owned by
the single patentee.
The Commission’s claims necessitate that we again
consider the interplay between two distinct federal statutory
schemes: the Patent Act’s protections for creativity and the
Sherman Act’s pro-competition and antitrust regulation.
The Supreme Court has long recognized that certain
exercises of patent rights are lawful despite the Sherman Act’s
dictates. For example, the “owner of a patent may assign it to
another and convey . . . the exclusive right to make, use, and
vend the invention.” United States v. Gen. Elec. Co., 272 U.S.
476, 489 (1926). Short of assignment, a patent owner may also
“grant a license to make, use, and vend articles under the
specifications of his patent for any royalty, or upon any
condition the performance of which is reasonably within the

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reward which the patentee by the grant of the patent is entitled
to secure.” Id. Since its decision in General Electric, the
Supreme Court has continued to emphasize that “[t]here is
nothing unlawful in the requirement that a licensee should pay
a royalty to compensate the patentee for the invention and the
use of the patent.” United States v. Line Material Co., 333 U.S.
287, 315 (1948). As a result, patent owners can place
conditions on a licensee’s sale of the patented product,
“provided the conditions of sale are normally and reasonably
adapted to secure pecuniary reward for the patentee’s
monopoly.” Id. at 299 (quoting Gen. Elec., 272 U.S. at 490).
Accordingly, we have previously recognized in a similar
situation that “the protection of patent laws and the coverage of
the antitrust laws are not separate issues.” United States v.
Studiengesellschaft Kohle, m.b.H., 670 F.2d 1122, 1128 (D.C.
Cir. 1981) (citation omitted). Our decision in
Studiengesellschaft Kohle recognized the legality of standard
exclusive licensing agreements: “A patentee may grant one
exclusive license,” which “is an agreement by the patentee,
usually for a consideration, not to sue the licensee of the patent
for infringement of the patent.” Id. at 1127 (citations omitted).
“Frequently, a patentee grants licenses on certain conditions, in
addition to the requirement that the licensee pay royalties.” Id.
Upon consideration of the aforementioned law, the
resolution of this dispute turns on the answer to a single
question: Does a valid patent holder’s grant of a nearly
exclusive license to a single potential competitor in exchange
for royalty payments violate antitrust law when that nearly
exclusive license restrains trade only to an extent traditionally
recognized by patent law as reasonable? We think not.
After Studiengesellschaft Kohle, the Supreme Court
weighed in on patent agreements in FTC v. Actavis, Inc., a

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matter involving a reverse payment settlement wherein the
patentee “pa[id] the alleged infringer, rather than the other way
around.” 570 U.S. 136, 141 (2013). The Court held that, when
a complaint alleges that a patent holder has violated the
antitrust laws, courts must strike a balance “between the lawful
restraint on trade of the patent monopoly and the illegal
restraint prohibited broadly by the Sherman Act.” Id. at 148
(quoting Line Material Co., 333 U.S. at 310). If Congress has
already struck that balance in the Patent Act by “‘specifically
giv[ing] a right’ to restrain competition in the manner
challenged,” or where the Supreme Court has “previously
approved as reasonable” a given practice, we must defer to
those judgments. Id. (quoting Line Material Co., 333 U.S. at
311).
But while Actavis held that the unexplained “reverse
payment” at issue in that case was subject to antitrust scrutiny,
it did not disturb the long-standing principle that a single
patentee may set conditions in granting a single licensee the
right to use its valid patents. See id. at 150. And here, unlike
in Actavis, the Patent Act expressly authorizes behavior that
closely resembles the 2017 Agreement, permitting a patent
owner to “grant and convey an exclusive right under his . . .
patents.” 35 U.S.C. § 261. Consistent with the Patent Act, the
Court’s holding in Actavis acknowledged the accepted
understanding that a patent holder’s grant of an exclusive
license to a potential competitor in exchange for payment of a
royalty generally raises no issue under the antitrust laws. In
this regard, the Commission does not offer any support for its
assertion that an exclusive licensing agreement is different if
the parties are potential competitors. That, after all, describes
the facts of General Electric, 272 U.S. at 489, by which we
remain bound, see Actavis, 570 U.S. at 150.

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In this appeal, the Commission contends that the 2017
Agreement is not a standard exclusive licensing agreement
because the 2010 Agreement had already given Impax a license
to Endo’s present and future patents. Therefore, the 2017
Agreement was instead an agreement not to compete.
As an initial matter, the Patent Act defines a licensing
agreement as one conveying a “right under . . . [the] patent.”
35 U.S.C. § 261. Here, because of Endo’s victory at the
motion‐to‐dismiss stage of its infringement suit against Impax,
Endo had such a right to convey—namely, the right to practice
its patents unclouded by a plausible claim for infringement
backed by the threat of treble damages. See Endo Pharms., Inc.
v. Impax Lab’ys, Inc., No. 16-2526, 2016 WL 6246773, at *5
(D.N.J. Oct. 25, 2016); see also Alfred E. Mann Found. for Sci.
Rsch. v. Cochlear Corp., 604 F.3d 1354, 1360–1361 (Fed. Cir.
2010) (The most important of the “rights available under the
patent” in determining ownership is “[f]requently . . . a right to
sue accused infringers.”).
However, even if the Commission’s characterization of the
2010 Agreement is correct, the Commission fails to explain
how the 2017 Agreement—the agreement it now challenges—
meaningfully differs from a standard exclusive license. The
Commission’s complaint and briefing suggested that the
meaningful difference stems from the parties’ prior 2010
Agreement, under which Endo granted Impax a non-exclusive
license to produce a generic alternative to Opana ER. But the
Commission’s complaint offers no evidence or reasoning from
which to conclude that this otherwise permissible exclusive
license somehow became impermissible if it was preceded by
a non-exclusive license like the one conferred by the 2010
Agreement, especially since the 2017 Agreement appears to
have been a straightforward and bona-fide settlement of
ongoing litigation.

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Indeed, the Commission admitted that its challenge to the
2017 Agreement would remain the same even if the prior 2010
Agreement had never existed. See Oral Arg. 20:23–22:5. That
concession all but confirms that the subject of the
Commission’s challenge is to the 2017 Agreement alone—an
agreement that is legally indistinguishable from (and
technically less restrictive than) a standard exclusive license.
Moreover, in the absence of any allegations of antitrust harms
extending beyond those explicitly sanctioned by Congress in
the Patent Act and by the Supreme Court in Actavis, there is no
basis on which to find Sherman Act liability on this record.1
As a result, with or without the 2010 Agreement, the
viability of the Commission’s Sherman Act claims depends on
the sufficiency of allegations regarding the 2017 Agreement.
But beyond failing to distinguish the 2017 Agreement from a
standard exclusive license, the Commission has not pointed to
any aspect of the Endo-Impax settlement that might justify
further antitrust scrutiny. For example, the Commission has
not alleged that the 2017 Agreement was an “unusual”
settlement in which Endo paid Impax to drop a legitimate
challenge against potentially weak or invalid patents. See
Actavis, 570 U.S. at 147–48 (“The FTC alleges that in
substance, the plaintiff agreed to pay the defendants many
1 Even though the Commission believes that its allegations are
similar to an agreement condemned by the Supreme Court, see
Comm’n Br. 28–29, this case is distinguishable from Palmer v. BRG
of Georgia, 498 U.S. 46 (1990), in which an exclusive licensing
agreement was a pretext for a noncompete agreement between two
competitors, because the parties in Palmer did not require one
another’s intellectual property to participate in the market for bar
preparation courses. Here, by contrast, Impax’s ability to compete
was completely contingent on the clarity of its license to use Endo’s
patents, and the complaint itself alleges that Endo surrendered the
right to press its suit against Impax through the 2017 Agreement.

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millions of dollars to stay out of its market, even though the
defendants did not have any claim that the plaintiff was liable
to them for damages. That form of settlement is unusual.”).
Nor has the Commission alleged that the 2017 Agreement gave
Endo undue economic power to control a different market
beyond the one it already controlled through its patents. Cf.
United States v. New Wrinkle, Inc., 342 U.S. 371, 380 (1952)
(invalidating a scheme in which multiple patent holders
“pool[ed] their patents” to “fix prices on . . . products for
themselves and their licensees”); Line Material Co., 333 U.S.
at 314–15 (finding concerted action by multiple patentees to
“join in an agreement . . . to maintain prices on their several
products” to be “unlawful per se under the Sherman Act”).
These examples, of course, are merely illustrative; as Actavis
cautions, “presumptive rules” would be inappropriate in this
context. See 570 U.S. at 159. In a future case, the Commission
is free to plead that a licensing agreement results in
unjustifiable competitive harms, so long as it explains how
those harms exceed what the Patent Act and settled precedent
permit, which it has failed to do here.
In sum, we reason that the Commission’s complaint lacks
allegations establishing that the 2017 Agreement created
anticompetitive effects greater than that authorized by settled
law and precedent. Neither precedent nor the Commission’s
allegations permit this court to conclude that the 2017
Agreement meaningfully differs from a standard exclusive
license, which both the Supreme Court and the Patent Act have
blessed as lawful. See Line Material Co., 333 U.S. at 308
(“During its term, a valid patent excludes all except its owner
from the use of the protected process or product. This
monopoly may be enjoyed exclusively by the patentee or he
may assign the patent ‘or any interest therein’ to others.”
(citations omitted)). Therefore, the Commission’s Sherman

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Act claims are appropriately dismissed for failure to state a
claim.
C.
In its opinion, the district court acknowledged, but did not
rule on Endo International’s contention that any claim against
it should be dismissed for lack of personal jurisdiction. See
Endo Pharms. Inc., 596 F. Supp. 3d at 120 (citation omitted).
Normally, we would consider this error because “when
personal jurisdiction is in question, a court must first determine
that it possesses personal jurisdiction over the defendants
before it can address the merits of a claim.” Kaplan v. Cent.
Bank of the Islamic Republic of Iran, 896 F.3d 501, 510 (D.C.
Cir. 2018); see Sinochem Int’l Co. Ltd. v. Malaysia Int’l
Shipping Corp., 549 U.S. 422, 430–31 (2007). But personal
jurisdiction can be waived and there is a question of whether
Endo International properly preserved the issue for appeal. See
Shatsky v. PLO, 955 F.3d 1016, 1032 (D.C. Cir. 2020)
(Personal jurisdiction “is both forfeitable and waivable.”
(citation omitted)); Spann v. Colonial Vill., Inc., 899 F.2d 24,
32–3 (D.C. Cir. 1990) (“[P]ersonal jurisdiction and venue, can
be waived at any stage of a proceeding and ordinarily are
waived by failure to take a cross-appeal.” (citation omitted));
see also Inc. Corp. of Ir., Ltd. v. Compagnie des Bauxites de
Guinee, 456 U.S. 694, 703 (1982).
Two aspects of the record counsel against granting any
form of relief on the personal jurisdiction question. First, Endo
International failed to either file a cross-appeal challenging the
district court’s exercise of personal jurisdiction or identify
“exceptional circumstances” to excuse that failure. Shatsky,
955 F.3d at 1028 (“When . . . the district court rejects a
defendant’s claim that the court lacks personal jurisdiction, but
then rules in the defendant’s favor on the merits, the defendant

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generally must take a cross-appeal to preserve the personal
jurisdiction objection.” (citation omitted)); see also id. at 1030
(“[W]e will excuse compliance with the cross-appeal rule only
in “exceptional circumstances.” (citation omitted)). Second,
Endo International repeatedly requests affirmance of the
district court’s order, see Endo Br. 3, 15, 37, but “if we
conclude that the district court lacked personal jurisdiction, we
must vacate—not affirm—its judgment on the merits.”
Shatsky, 955 F.3d at 1029 (citation omitted). Considering all
of these circumstances, we find that Endo International waived
any objection to personal jurisdiction.
*****
For the foregoing reasons, we affirm the judgment of the
district court dismissing the Commission’s complaint pursuant
to Federal Rule of Civil Procedure 12(b)(6) for failure to state
a claim.
So ordered.

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