Cvs Pharmacy v. Hon. bostwick/tucson Medical

CourtArizona Supreme Court
DecidedSeptember 1, 2021
DocketCV-20-0120-PR
StatusPublished

This text of Cvs Pharmacy v. Hon. bostwick/tucson Medical (Cvs Pharmacy v. Hon. bostwick/tucson Medical) is published on Counsel Stack Legal Research, covering Arizona Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cvs Pharmacy v. Hon. bostwick/tucson Medical, (Ark. 2021).

Opinion

IN THE

SUPREME COURT OF THE STATE OF ARIZONA

CVS PHARMACY, INC., AND CVS ARIZONA, L.L.C., Petitioners,

v.

THE H ONORABLE JANET C. BOSTWICK, JUDGE OF THE SUPERIOR COURT OF THE STATE OF ARIZONA, IN AND FOR THE COUNTY OF PIMA, Respondent Judge,

and

TUCSON MEDICAL CENTER, Real Party in Interest.

No. CV-20-0120-PR Filed September 1, 2021

Appeal from the Superior Court in Pima County The Honorable Janet C. Bostwick, Judge No. C20184991 REVERSED AND REMANDED

Order of the Court of Appeals, Division Two No. CA-SA 2020-0012 Filed April 14, 2020 CVS PHARMACY, INC . V. H ON. BOSTWICK/TUCSON MEDICAL CENTER Opinion of the Court

COUNSEL:

Andrew M. Federhar, Jessica A. Gale, Spencer Fane LLP, Phoenix, and Conor B. O’Croinin (argued), Zuckerman Spaeder LLP, Baltimore, MD, Attorneys for CVS Pharmacy, Inc. and CVS Arizona, L.L.C.

Ronald Jay Cohen, Daniel G. Dowd (argued), Betsy J. Lamm, Lauren M. LaPrade, Cohen Dowd Quigley, P.C., Phoenix; Lance Oliver, Motley Rice LLC, Mount Pleasant, SC; Steven C. Mitchell, Samuel F. Mitchell, Mitchell & Speights, L.L.C, Scottsdale, Attorneys for Tucson Medical Center

Jeffrey C. Warren, Amanda Heitz, David T. Lundmark, Claudia C. Ionescu, Charles M. Seby, Bowman and Brooke LLP, Phoenix, Attorneys for Amicus Curiae Arizona Association of Defense Counsel

Troy P. Foster, Megan Weides, The Foster Group, PLLC, Phoenix; Chad Golder, Esq. Washington, DC, Attorneys for Amici Curiae American Hospital Association, Federation of American Hospitals and America’s Essential Hospitals

Eric M. Fraser, Hayleigh S. Crawford, Osborn Maledon, P.A., Phoenix, Attorneys for Amici Curiae Kingman Hospital, Inc., Arizona Spine and Joint Hospital LLC, Bullhead City Hospital Corporation, Carondelet St. Joseph’s Hospital, Holy Cross Hospital, Inc., Hospital Development of West Phoenix, Inc., Northwest Hospital, LLC, Oasis Hospital, Oro Valley Hospital, LLC, Orthopedic and Surgical Specialty Company, LLC, St. Mary’s Hospital of Tucson, VHS Acquisition Subsidiary Number 1, Inc., VHS of Arrowhead, Inc., and Yuma Regional Medical Center

Timothy A. Nelson, The Nelson Law Group, PLLC, Phoenix, Attorney for Amicus Curiae Arizona Hospital and Healthcare Association

Daniel J. O’Connor, Jr., Richard R. Reed, Jr., O’Connor & Dyet, P.C., Tempe; A. Joshua Podoll and Danielle Sochaczevski, Williams & Connolly LLP, Washington, DC, Attorney for Amicus Curiae Cardinal Health, Inc. CVS PHARMACY, INC . V. H ON. BOSTWICK/TUCSON MEDICAL CENTER Opinion of the Court

John J. Kastner, Jr., Rachel B. Weil, Steven J. Boranian, Jennings, Strouss & Salmon, P.L.C., Tucson, Attorney for Amicus Curiae AmerisourceBergen Drug Corporation

David L. Abney, Ahwatukee Legal Office, P.C., Phoenix, Attorney for Amicus Curiae Arizona Association for Justice/Arizona Trial Lawyers Association

Bradley J. Johnston, Levi T. Claridge, The Cavanagh Law Firm, Phoenix; Charles C. Lifland, Sina S. Aria, O’Melveny & Myers LLP, Los Angeles, CA; Steve Brody, O’Melveny & Myers LLP, Washington, DC; Todd Jackson, Jean Roof, Jackson & Oden, P.C. Tucson; André H. Merrett, Thorpe Shwer, P.C., Phoenix, John D. Lombardo, Jake R. Miller, Arnold & Porter, Los Angeles, CA; Richard M. Amoroso, Gregory A. Davis, Squire Patton Boggs (US) LLP, Phoenix; Brent A. Hawkins, Morgan, Lewis & Bockius LLP, San Francisco, CA; Brian M. Ercole, Morgan, Lewis & Bockius LLP, Miami, Florida, Attorneys for Amicus Curiae Pharmaceutical Manufacturers

________________

JUSTICE BOLICK authored the opinion of the Court, in which CHIEF JUSTICE BRUTINEL, VICE CHIEF JUSTICE TIMMER, and JUSTICES LOPEZ, BEENE, and PELANDER (Retired) * joined. **

_______________

* Justice William G. Montgomery has recused himself from this case. Pursuant to article 6, section 3 of the Arizona Constitution, the Honorable Justice John Pelander (Ret.), was designated to sit in this matter.

**Although Justice Andrew W. Gould (Ret.) participated in the oral argument in this case, he retired before issuance of this opinion and did not take part in its drafting. CVS PHARMACY, INC . V. H ON. BOSTWICK/TUCSON MEDICAL CENTER Opinion of the Court

JUSTICE BOLICK, opinion of the Court:

¶1 This case concerns whether a hospital may directly recover from a third party the costs of uncompensated medical care provided to patients whose need for treatment the third party allegedly caused, and whether a pharmacy that self-distributes prescription opioids to its affiliated pharmacies owes a duty to a hospital that incurs costs to treat opioid-addicted patients. We hold that the exclusive right for a hospital to recover from a third-party tortfeasor is through the medical lien statutes and that a pharmacy does not owe a duty to a hospital under the facts alleged here. I. BACKGROUND

¶2 CVS Health Corporation operates centers that distribute prescription drugs to CVS-branded retail pharmacies, which in turn sell those medications to individual patients. Tucson Medical Center (“TMC”) is a nonprofit community hospital serving residents throughout southern Arizona.

¶3 In October 2018, TMC filed a complaint alleging a broad “conspiracy” among drug manufacturers, distributors, and marketers (the “Marketing and Distributor Defendants”) to establish a “network to promote the use of opioids” by making “misrepresentations and omissions regarding the appropriate uses, risks, and safety of opioids, to increase sales, revenue, and profit from their opioid products.” In short, TMC alleged the Marketing and Distributor Defendants created a false narrative of opioid-friendly messaging, fueling the national opioid epidemic.

¶4 In July 2019, TMC filed its First Amended Complaint (the “Complaint”), adding CVS Health Corporation; CVS Pharmacy, Inc.; CVS Arizona, LLC; and specific CVS Pharmacies (collectively, “CVS”) as defendants. TMC’s Complaint alleged that CVS, together with the Marketing and Distributor Defendants, “extract billions of dollars of revenue from the addicted American public while hospitals sustain tens of millions of dollars of losses caused as a result of the reasonably foreseeable consequences of the prescription opioid addiction epidemic.” The Complaint also alleged that CVS “failed to exercise due care in dispensing, CVS PHARMACY, INC . V. H ON. BOSTWICK/TUCSON MEDICAL CENTER Opinion of the Court

and instead dispensed far more opioids into Arizona communities than were needed for licit use.” With respect to the individual CVS Pharmacies, the Complaint alleged that each such store has a duty to establish policies and procedures to avoid filling prescriptions indicative of abuse, to train their employees on these policies and procedures, and to report potential diversion of opioids—which occurs when individuals obtain prescription opioids for nonmedical purposes—to the appropriate authorities.

¶5 The Complaint alleged that all defendants, including CVS, were liable for negligence, wanton negligence, negligence per se, negligent distribution, nuisance, and unjust enrichment (respectively, Counts 3, 4, 5, 7, 8, and 9). TMC alleged hospitals within the state incur “millions of dollars in damages for the costs of uncompensated care,” and that TMC suffered additional damages by incurring operating expenses, including “additional training, additional security. . . . [and] special programs over and above their ordinary hospital services” due to caring for opioid- addicted patients. Unlike the hospitals in Ansley v. Banner Health Network, TMC does not seek damages for Medicaid patients. See 248 Ariz. 143, 153 ¶ 45 (2020) (holding that the lien statutes cannot allow hospitals to recover the costs of medical care beyond the amounts provided by Medicaid).

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