PharmacyChecker.com LLC v. LegitScript LLC

District Court, D. Oregon·Decided March 7, 2024·No. 3:22-cv-00252·Unknown

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF OREGON

PHARMACYCHECKER.COM LLC, Case No. 3:22-cv-252-SI

Plaintiff, OPINION AND ORDER

v.

LEGITSCRIPT LLC,

Defendant.

Philip S. Van Der Weele, K&L GATES LLP, One SW Columbia Street, Suite 1900, Portland, OR 97204; Aaron R. Gott, BONA LAW PC, 331 Second Avenue South, Suite 420, Minneapolis, MN 55401; and James F. Lerner, BONA LAW PC, 41 Madison Avenue, Suite 2509, New York, NY 10010. Of Attorneys for Plaintiff PharmacyChecker.com LLC.

Richard P. Sybert, Hannah Brown, and Matthew Mejia, GORDON REES SCULLY MANSUKHANI LLP, 1300 SW Fifth Avenue, Suite 2000, Portland, OR 97201; John T. Mills, GORDON REES SCULLY MANSUKHANI LLP, One Battery Park Plaza, 28th Floor, New York, NY 10004; and Christopher Pallanch, TONKON TORP LLP, 888 SW Fifth Avenue, Suite 1600, Portland, OR 97204. Of Attorneys for Defendant LegitScript LLC.

Michael H. Simon, District Judge.

Plaintiff PharmacyChecker.com LLC (PharmacyChecker) brings this antitrust lawsuit under § 1 of the Sherman Act, 15 U.S.C. § 1, against defendant LegitScript LLC (LegitScript). PharmacyChecker alleges that it is the victim of a conspiracy to restrain competition in the markets for online pharmacy verification services and comparative drug pricing information. On January 3, 2024, the Court issued an Opinion and Order denying LegitScript’s motion for summary judgment (Summary Judgment Opinion), in which the Court rejected LegitScript’s argument that PharmacyChecker lacked antitrust standing. PharmacyChecker.com LLC v. LegitScript LLC, 2024 WL 33410 (D. Or. Jan. 3, 2024). Now before the Court is LegitScript’s Motion to Certify Order for Interlocutory Appeal (LegitScript’s Motion to Certify). Pursuant to

28 U.S.C. § 1292(b), LegitScript requests that the Court certify for interlocutory review the Summary Judgment Opinion. PharmacyChecker opposes that motion. For the following reasons, the Court grants LegitScript’s Motion to Certify. STANDARD The Interlocutory Appeals Act of 1958, 28 U.S.C. § 1292(b), “created a two-tiered ‘screening procedure’ to preserve an appropriate relationship between a federal trial court and a federal appellate court “and to restrict the availability of interlocutory review to ‘appropriate cases.’” Microsoft Corp. v. Baker, 582 U.S. 23, 29 (2017) (quoting Coopers & Lybrand v. Livesay, 437 U.S. 463, 474 (1978)). “For a party to obtain review under § 1292(b), the district court must certify that the interlocutory order involves a controlling question of law as to which

there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation.” Id. (quotation marks omitted). A court may find a question of law “controlling” if its resolution “could materially affect the outcome of litigation in the district court.” In re Cement Antitrust Litig., 673 F.2d 1020, 1026 (9th Cir. 1982). A court may find substantial ground for difference of opinion when “reasonable jurists might disagree” about the resolution to the question of law at issue. Reese v. BP Expl. (Alaska) Inc., 643 F.3d 681, 688 (9th Cir. 2011). “[T]he party pursuing the interlocutory appeal bears the burden of . . . demonstrating” that the certification requirements of the statute have been met. Couch v. Telescope Inc., 611 F.3d 629, 633 (9th Cir. 2010). BACKGROUND The nature of PharmacyChecker’s business operation, the parties’ relationship, and the procedural history of this action are discussed in detail in the Court’s Summary Judgment Opinion. See PharmacyChecker.com, 2024 WL 33410, at *3-6. As relevant to the pending Motion to Certify, in August 2019, PharmacyChecker filed a federal lawsuit in the Southern

District of New York (New York Case). In that action, PharmacyChecker alleged violations of federal antitrust law and sued five alleged conspirators, including LegitScript.1 Because of issues relating to personal jurisdiction, PharmacyChecker’s claim against LegitScript was transferred to the District of Oregon. LegitScript is the only defendant in this action. The four remaining defendants in the New York Case (New York Defendants) moved for partial summary judgment against PharmacyChecker’s antitrust claim. The New York Defendants argued, in part, that because PharmacyChecker’s “‘primary mission’ is to facilitate U.S. consumers’ unlawful importation of foreign pharmaceuticals,” PharmacyChecker has not suffered any cognizable antitrust injury and therefore lacks antitrust standing to maintain its claim. See PharmacyChecker.com v. Nat’l Ass’n of Bds. of Pharm., 2023 WL 2973038, at *12

(S.D.N.Y. Mar. 28, 2023). In the New York Case, U.S. District Court Judge Kenneth M. Karas formulated the following standard from a set of cases that addressed antitrust injury when a plaintiff’s business involves illegality: “[W]here the plaintiff’s enterprise is completely or almost completely illegal, or completely or almost completely geared toward facilitating illegality, that plaintiff cannot plead an antitrust injury.” Id. at *13 (quotation marks omitted). Applying that standard at

1 In the New York Case, PharmacyChecker also asserted a Lanham Act claim against one of the five defendants. summary judgment, Judge Karas found that the New York Defendants had “met their burden to prove that [PharmacyChecker’s] enterprise is ‘completely or almost completely geared towards facilitating illegality,’” and, for that reason, held that PharmacyChecker “does not have standing to maintain its claim pursuant to § 1 of the Sherman Act,” resulting in summary judgment in favor of the New York Defendants on that claim. Id. at *30.

LegitScript then moved for summary judgment in this action, asserting, among other arguments, “the same grounds as the defendants in the New York action,” i.e., that PharmacyChecker “has not suffered any cognizable injury under the Sherman Act and therefore lacks standing as the primary purpose of PharmacyChecker’s business is to enable consumers to illegally buy drugs from foreign pharmacies.” ECF 271 at 2. In its Summary Judgment Opinion, the Court noted that no case from the United States Supreme Court or the Ninth Circuit directly addressed “whether an antitrust plaintiff, which does not itself engage in illegal activity, lacks antitrust standing merely because that plaintiff’s website facilitates illegal activity by others and the plaintiff receives revenue as an indirect result

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PharmacyChecker.com LLC v. LegitScript LLC, (D. Or. 2024).

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