In Re: Plavix Marketing v.

CourtCourt of Appeals for the Third Circuit
DecidedSeptember 1, 2020
Docket18-2472
StatusPublished

This text of In Re: Plavix Marketing v. (In Re: Plavix Marketing v.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Third Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re: Plavix Marketing v., (3d Cir. 2020).

Opinion

PRECEDENTIAL

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _______________

No. 18-2472 _______________

IN RE: PLAVIX MARKETING, SALES PRACTICES AND PRODUCTS LIABILITY LITIGATION (NO. II)

UNITED STATES OF AMERICA; STATE OF CALIFORNIA; STATE OF COLORADO; STATE OF CONNECTICUT; STATE OF DELAWARE; DISTRICT OF COLUMBIA; STATE OF FLORIDA; STATE OF GEORGIA; STATE OF ILLINOIS; STATE OF INDIANA; STATE OF IOWA; STATE OF LOUISIANA; COMMONWEALTH OF MASSACHUSETTS; STATE OF MICHIGAN; STATE OF MINNESOTA; STATE OF MONTANA; STATE OF NEVADA; STATE OF NEW JERSEY; STATE OF NEW YORK; STATE OF NORTH CAROLINA; STATE OF OKLAHOMA; STATE OF RHODE ISLAND; STATE OF TENNESSEE; COMMONWEALTH OF VIRGINIA; STATE OF WASHINGTON; STATE OF WISCONSIN, ex rel. JKJ PARTNERSHIP 2011 LP

v.

SANOFI-AVENTIS U.S. LLC; SANOFI-AVENTIS U.S. SERVICES, INC.; AVENTIS, INC.; AVENTIS PHARMACEUTICALS, INC.; BRISTOL-MYERS SQUIBB COMPANY; BRISTOL-MYERS SQUIBB SANOFI PHARMACEUTICALS HOLDING PARTNERSHIP

JKJ PARTNERSHIP 2011 LLP, Appellant _______________

On Appeal from the United States District Court for the District of New Jersey (D.C. Nos. 3-11-cv-06476 & 3-13-cv-02418) Chief District Judge: Honorable Freda L. Wolfson _______________

Argued: June 25, 2020

Before: JORDAN, BIBAS, and NYGAARD, Circuit Judges

(Filed: September 1, 2020) _______________

William H. Narwold Mathew P. Jasinski [ARGUED] Motley Rice 20 Church Street One Corporate Center, 17th Floor Hartford, CT 06103

W. Scott Simmer Baron & Budd 600 New Hampshire Avenue, Suite 10-A Washington, DC 20037 Counsel for Appellant

2 Anand Agneshwar [ARGUED] Arnold & Porter Kaye Scholer 250 West 55th Street New York, NY 10019

Murad Hussain Kirk Ogrosky Arnold & Porter Kaye Scholer 601 Massachusetts Avenue, N.W. Washington, DC 20001

Gavin J. Rooney Lowenstein Sandler One Lowenstein Drive Roseland, NJ 07068 Counsel for Appellees _______________

OPINION OF THE COURT _______________

BIBAS, Circuit Judge. To intervene is to butt in, not to be dragged in or to replace an existing party to a lawsuit. But no one butted in here. Three people formed a partnership to sue several pharmaceutical companies as a qui tam relator under the False Claims Act. When one of them left the partnership and was replaced, that change amounted to forming a new partnership. The compa- nies moved to dismiss because the Act’s first-to-file bar stops a new “person” from “interven[ing] or bring[ing] a related ac- tion based on the [same] facts.” 31 U.S.C. § 3730(b)(5). But the verb “intervene” means to inject oneself between two existing

3 parties, as under Federal Rule of Civil Procedure 24. The new partnership did not do that, but instead came in as the relator. Still, the District Court ruled for the companies, based mainly on a dictum from a Supreme Court case. But that case involved a very different issue, and the Court’s opinion never considered the issue here. Because the Act’s plain text bars only intervention or bringing a related suit, we will vacate and remand. I. BACKGROUND A. The partnership and the complaints In 2011, Jeffrey Stahl, Kelly Evans, and John Venditto formed a Delaware limited liability partnership named JKJ (af- ter their three first initials). Venditto and Stahl were doctors, and Evans was a former sales representative at Sanofi-Aventis. The partnership’s sole purpose was to prosecute a qui tam False Claims Act suit against Sanofi-Aventis and Bristol-My- ers Squibb, two pharmaceutical companies that developed and marketed the anti-clotting drug Plavix. So JKJ filed this suit in federal district court. The gist of the suit was that Sanofi and Bristol had pro- moted Plavix to treat a broad range of patients, even though they knew that many of them would reap little if any benefit. Sanofi and Bristol’s marketing, JKJ alleged, caused many false claims to be submitted for federal and state healthcare reim- bursement. JKJ alleged False Claims Act claims on behalf of the United States, as well as claims on behalf of dozens of states under their own qui tam statutes.

4 The complaints named JKJ as the sole plaintiff-relator. While the early complaints discussed the three partners’ back- grounds, they did not name them, using pseudonyms instead. The United States declined to intervene in the suit. By 2016, the partners’ relations had apparently soured. Venditto left and was replaced by Dr. Paul Gurbel. The second amended complaint, the one at issue, was filed in 2017 and names all three partners. But it still names JKJ as the sole rela- tor. The partners viewed the old JKJ partnership as the same entity as the new one. That theory would be tested in this suit’s pinball journey among three different state and federal courts. B. District Court proceedings Sanofi and Bristol moved to dismiss, invoking the False Claims Act’s first-to-file bar. 31 U.S.C. § 3730(b)(5); see United States ex rel. JKJ P’ship 2011, LLP v. Sanofi Aventis, U.S., LLC (In re Plavix Mktg., Sales Practices & Prods. Liab. Litig. (No. II)), 315 F. Supp. 3d 817, 821–22 (D.N.J. 2018) (In re Plavix I). Sanofi and Bristol’s theory was that New JKJ was a different legal entity from Old JKJ, so its effort to pursue the suit as the relator amounted to an “interven[tion]” banned by the first-to-file bar. See In re Plavix I, 315 F. Supp. 3d at 830. The District Court agreed and dismissed the suit. In a care- ful and comprehensive opinion, it thoroughly analyzed Dela- ware partnership law, concluding that Old JKJ and New JKJ were distinct legal entities. In re Plavix I, 315 F. Supp. 3d at 830–34. Because the two entities were different, the District Court held that New JKJ’s presence violated the first-to-file

5 bar. Id. at 834–35. It relied heavily on a Supreme Court deci- sion, United States ex rel. Eisenstein v. City of New York, 556 U.S. 928, 933–35 (2009), which it read as holding that when- ever a nonparty tries to join a qui tam False Claims Act suit, it is “interven[ing]” within the meaning of the first-to-file bar. See Plavix I, 315 F. Supp. 3d at 834–35. It also relied on a re- cent Tenth Circuit decision that read Eisenstein the same way. Id. at 835–36 (discussing United States ex rel. Little v. Triumph Gear Sys., Inc., 870 F.3d 1242 (10th Cir. 2017)). Because the District Court read Eisenstein’s rule as barring a new relator from replacing an old one in an amended complaint, it dis- missed JKJ’s suit. Id. C. Delaware Supreme Court proceedings The partnership appealed to us. Recognizing the important role that Delaware partnership law plays here, we certified three questions to the Delaware Supreme Court. The Delaware Supreme Court accepted the certification and assisted us by an- swering them. First, it agreed with the District Court that Old JKJ and New JKJ were distinct partnerships. United States ex rel. JKJ P’ship 2011 LLP v. Sanofi-Aventis U.S. LLC, 226 A.3d 1117, 1123 (Del. 2020) (In re Plavix II). Second, it could not answer whether Old JKJ survived long enough to file the com- plaint now before us. Id. at 1133. But it noted that the second amended complaint named the three partners as Stahl, Evans, and Gurbel, so that complaint must have been filed by New JKJ. Id.

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