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(Reuters) - The American National Red Cross has asked a Boston federal judge to dismiss as "implausible" a lawsuit from a biomedical company alleging the humanitarian organization abused its dominance over life-saving cell fragments that help blood to clot.
In a Monday court filing, lawyers at Latham & Watkins for the Red Cross said the lawsuit by Massachusetts-based Verax Biomedical Inc, which makes a blood-testing product, failed to show how it competed with the nonprofit.
Attorneys for the Red Cross also argued it was an "instrumentality" of the U.S. federal government and could not be held liable under U.S. antitrust provisions.
Verax's complaint in February accused the Red Cross, the country's largest supplier of blood, of trying to curb competition for services to reduce the threat of bacterial contamination in blood platelets, the cell parts that help to stop bleeding.
Verax said its product that rapidly tests for bacteria in platelets competes with the Red Cross.
The Red Cross collects and sells blood platelets to hospitals. But the organization said in its court filing that it adopted "pathogen reduction technology" that differs from a testing product that Verax makes.
Attorneys from Latham also argued that Verax's case was anchored to the "fundamentally implausible premise" that the Red Cross has tried to block Verax from selling its product to hospitals.
"Verax's test is not a substitute for any platelet product the Red Cross currently sells or has ever sold to hospitals," lawyers for the Red Cross said in their filing.
Lawyers for the Red Cross alleged Verax was "flailing" in its effort to sell a test product to hospitals and sued the Red Cross "rather than innovating or proving" the value of its test.
A Verax spokesperson and lawyer for the company, Elizabeth Keeley, on Tuesday did not immediately respond to messages seeking comment.
A Red Cross spokesperson on Tuesday said in a statement that the lawsuit has "no merit."
Verax said in its lawsuit it had distributed more than 1.6 million rapid-tests to hospitals. Competition for "bacteria mitigation service," the lawsuit said, was "critical to hospitals' ability to effectively manage their platelet inventories."
The lawsuit accused the Red Cross of "a campaign to illegally smother this robust competition and obtain a monopoly in the U.S. market for platelet bacteria mitigation services."
In its filing, the Red Cross said it was required to take steps to reduce the potential for bacterial contamination before selling platelets.
The case is Verax Biomedical Inc v. American National Red Cross, U.S. District Court for the District of Massachusetts, No. 1:23-cv-10335-PBS.
For Verax: Elizabeth Keeley of Butters Brazilian
For Red Cross: William Trach, Amanda Reeves and Alfred Pfeiffer of Latham & Watkins
(UPDATE: This report was updated with comment from the Red Cross.)
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