Legal News for Thurs 10/10 - 5th Circuit Overturns ISP Music Piracy Award, GSK Settles $2.2b in Zantac Suits and FTX Investors Drop Claim Against Sullivan and Cromwell

Minimum Competence

This Day in Legal History: Outer Space Treaty Enters Into Force

On October 10, 1967, the Outer Space Treaty, formally known as the "Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, including the Moon and Other Celestial Bodies," entered into force. This landmark agreement established a framework for the peaceful use and exploration of outer space, making it a key pillar of international space law. It was signed by the United States, the Soviet Union, and the United Kingdom, and has since been ratified by over 100 nations.

The treaty explicitly prohibits the placement of nuclear weapons or other weapons of mass destruction in orbit, on the Moon, or on any other celestial body. It also bans military activities and the establishment of military bases in space. One of its central tenets is that space is to be used for the benefit of all humankind, with no country allowed to claim sovereignty over outer space or any celestial body.

This treaty was negotiated during the height of the Cold War, reflecting both superpowers' mutual interest in preventing the militarization of space. By laying the groundwork for cooperation and peaceful exploration, it paved the way for future international agreements on space activities, including those addressing environmental concerns and the use of space resources. The Outer Space Treaty remains a cornerstone of space law today, as space exploration continues to evolve and expand.

The Fifth Circuit Court of Appeals overturned a $47 million copyright infringement award against Grande Communications Networks LLC, an internet service provider (ISP), on Wednesday. Music publishers, including UMG Recordings and Warner Bros. Records, initially won the award after Grande was found liable for contributing to users' piracy of over 1,400 songs. However, the appeals court ruled that damages should not be awarded for each individual song, but rather for each album, sending the case back to the Texas district court for a new trial on damages. The court affirmed that Grande had failed to prevent repeated piracy by not terminating infringing subscribers, but found that the lower court had erred in its interpretation of statutory damages. This decision aligns with other rulings, such as one involving ISP Cox Communications, where liability for music piracy was affirmed, but damages were reconsidered.

Appeals Court Undoes $47 Million Music Piracy Award Against ISP

GSK has agreed to settle around 80,000 lawsuits, paying up to $2.2 billion over claims that the discontinued heartburn drug Zantac caused cancer. This settlement covers about 93% of the cases pending in U.S. state courts. The drugmaker maintains that there is no consistent evidence linking Zantac’s active ingredient, ranitidine, to cancer but decided to settle to avoid prolonged litigation. Additionally, GSK will pay $70 million to settle a related whistleblower case.

Zantac, once a blockbuster drug, faced scrutiny after the FDA in 2020 found that ranitidine could break down into a carcinogen, NDMA. Other pharmaceutical companies like Pfizer and Sanofi have also reached settlements, but Boehringer Ingelheim continues to face trials. In a recent Delaware ruling, plaintiffs were allowed to present expert testimony linking Zantac to cancer, while a Florida federal court had dismissed around 50,000 cases due to unreliable evidence.

GSK agrees to settle about 80,000 Zantac lawsuits for up to $2.2 bln | Reuters

FTX investors have voluntarily dropped their class action lawsuit against Sullivan & Cromwell, a prominent U.S. law firm. The investors had accused the firm of aiding FTX’s multibillion-dollar fraud and benefiting as FTX’s lead bankruptcy counsel. However, lead attorney Adam Moskowitz stated that after reviewing reports by FTX bankruptcy examiner Robert Cleary, there was no valid claim against the law firm. Cleary’s reports found no evidence that Sullivan & Cromwell was complicit in FTX’s collapse or that it ignored warning signs while representing former FTX CEO Sam Bankman-Fried. Sullivan & Cromwell welcomed the withdrawal of what it called "meritless claims." The lawsuit had alleged that the firm had unique insight into FTX’s lack of internal controls and questionable practices. Meanwhile, FTX's bankruptcy plan, approved this week, will allow the company to repay customers using $16.5 billion in recovered assets. Plaintiffs’ attorneys also reached a separate agreement with the FTX bankruptcy estate regarding customer claims.

FTX investors drop lawsuit against law firm Sullivan & Cromwell | Reuters

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