Highlights of the latest franchising cases from around the country.

Features

On May 29, 2003, the Governor of Delaware, Ruth Ann Minner, signed into law new legislation that may signal the willingness of courts to facilitate the resolution of disputes before the parties have passed the 'point of no return' and resorted to litigation. If the new model proposed in Delaware meets with success and is broadened and adopted by other courts, the development could be meaningful for both franchisors and franchisees, given that disputes frequently arise in franchise systems. Both would benefit from early resolution that would preserve the strength of the system and maintain the important relationships between the franchisor and the franchisee during the balance of the term of the franchise agreement.

<i>Part 1 of a 2-part series.</i> Why should U.S. franchisors care about Canada and Canadian franchise law? Savvy franchisors realize that Canada's population is about the same as California's, and that the tastes of many Canadians are similar to (and molded) by their American counterparts. Also, U.S. franchisors' investment in Canada is facilitated under the North American Free Trade Agreement and the Investment Canada Act. While there are certainly similarities between the United States and Canada in the law respecting business-format franchising and trademarks, there are some major differences as well &mdash; some subtle; others not so subtle.

The proposed arrangement between a non-profit hospital and a for-profit emergency medical services transport services provider that serves a 17-county area in a prominently rural area of an anonymous state is the subject of a new OIG ruling. On July 3, 2003, the OIG posted Advisory Opinion No. 03-14, which involved a request concerning emergency helicopter transports of trauma patients. The unidentified state's Department of Transportation had concluded there was a real need for such emergency transport services because of higher mortality rates involved in transporting patients in this part of the state to appropriately equipped emergency rooms. Under the arrangement, the ambulance provider would buy, operate, staff, and maintain a helicopter that is equipped with a mobile intensive care unit to transport trauma victims, while the hospital would provide a landing pad next to the facility, and modest crew quarters and services for the helicopter ' which would be available to any ambulance company that brings or receives a patient to or from the facility. Moreover, emergency calls to 911 in the area are routed, based on pre-determined criteria, to a predetermined hospital, based on the patient's needs.

Features

This month, we examine a few Web sites that focus on antitrust law matters, including antitrust issues that involve the healthcare industry.

A New Jersey medical magazine publisher recently agreed to pay $3.7 million to settle allegations it defrauded the postal service. On July 2, 2003, the U.S. Attorney's Office for the District of New Jersey issued a press release announcing that Medical World Communications, a Jamesburg, NJ, publisher, agreed to settle civil False Claims Act allegations that it defrauded the government over a 6-year period (1994 to 2000) through a scheme by which it inflated the number of subscribers to obtain a lower rate, thereby failing to pay adequate postage for mailing its periodicals.

Features

Part One of a Two-Part Article. The FDA's approval of a prescription drug or biologic is the product of an often-delicate risk-benefit analysis of public benefit as opposed to individual safety. The therapeutic balance of these products must always be weighed against the risks inherent in their use. And there are always inherent risks associated with their use. Accordingly, while millions of Americans reap the benefits of prescription drugs every day, these same drugs may pose an unavoidable health hazard to a narrow, and often unidentifiable, subset of potential users. The American legal system currently regulates these risks by two means ' through the federal regulatory system as administered by the FDA, and through the common-law tort liability regime.

AstraZeneca Pharmaceuticals LP, the major pharmaceutical manufacturer headquartered in Wilmington, DE, pled guilty in a Delaware federal court to conspiring to violate the Prescription Drug Marketing Act (PDMA). (The PDMA was enacted in 1988 to regulate prescription drug marketing practices, such as providing free drug samples to physicians, since the practices could cause the diversion of drugs into gray markets, and incorporated into the federal Food Drug and Cosmetics Act under the 'prohibited acts' section at 21 U.S.C. ' 331(t)). AstraZeneca admitted that it caused claims to be submitted by urologists (who had received free samples from the company) for its anti-prostate cancer drug, Zoladex, to be submitted for reimbursement to federally funded health care programs during an 11-year period (from the beginning of 1991 through the end of 2002), resulting in almost $40 million in losses to these programs.