Rxstrategies, Inc. v. CVS Pharmacy, Inc.

390 F. Supp. 3d 1341
CourtDistrict Court, M.D. Florida
DecidedMay 29, 2019
DocketCase No: 8:18-cv-1087-T-30TGW
StatusPublished
Cited by9 cases

This text of 390 F. Supp. 3d 1341 (Rxstrategies, Inc. v. CVS Pharmacy, Inc.) is published on Counsel Stack Legal Research, covering District Court, M.D. Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Rxstrategies, Inc. v. CVS Pharmacy, Inc., 390 F. Supp. 3d 1341 (M.D. Fla. 2019).

Opinion

JAMES S. MOODY, JR., UNITED STATES DISTRICT JUDGE

THIS CAUSE comes before the Court upon Defendants' Motion to Dismiss (Dkt. 36), Plaintiff's Response in Opposition (Dkt. 42), Defendants' Memorandum in Support of the Motion (Dkt. 48), and Plaintiff's Response to Defendants' Memorandum (Dkt. 55). The Court, having reviewed the filings and being otherwise advised in the premises, concludes that Defendants' Motion should be granted in part.

BACKGROUND

The 340B Drug Pricing Program ("340B Program" or "340B") is a federal government program that allows qualifying healthcare providers, called "covered entities," to purchase outpatient drugs at a *1347significant discount. After purchasing the discounted drugs, covered entities can dispense them to patients directly, or through third-party pharmacies called "contract pharmacies." The 340B Program provides covered entities with savings based on the discounted prices of drugs. And participants in the program can choose how to use the savings they realize, including "caring for more patients, providing charitable medical care, and offsetting losses incurred from treating underinsured, uninsured, and indigent patients." Dkt. 30, p. 5.

The 340B Program holds participating covered entities responsible for complex tasks such as managing the contract pharmacies, preventing duplicate discounts for certain drugs, and ensuring compliance with government regulations. Plaintiff RxStrategies, Inc. ("RxStrategies") is a 340B program administrator, hired by covered entities to ensure their compliance with the 340B Program. Defendant CVS Pharmacy, Inc. ("CVS") is a retail pharmacy chain with some (or as RxStrategies argues, many) contract pharmacies that dispense outpatient drugs pursuant to the 340B Program.

According to RxStrategies, in 2016, CVS approached RxStrategies with the idea that RxStrategies could serve as a program administrator for CVS. The two entities entered into a mutual non-disclosure agreement ("NDA"), and RxStrategies began designing, building, and testing software solutions for CVS. RxStrategies alleged it shared proprietary information with CVS during these development phases, including lists of RxStrategies' covered entity customers and data processing solutions.

On December 18, 2017, CVS announced it acquired Defendant Wellpartner, LLC ("Wellpartner") to serve as CVS's exclusive program administrator for the 340B Program. RxStrategies alleged that CVS shared RxStrategies' proprietary information with Wellpartner, and Wellpartner contacted some of RxStrategies' covered entity customers. Wellpartner and RxStrategies are direct competitors.

CVS now requires any covered entity that wants to fill 340B Program prescriptions at a CVS pharmacy to use Wellpartner as its program administrator. If the covered entity does not want to use Wellpartner as its 340B program administrator, it cannot utilize CVS as a contract pharmacy for the 340B Program.

RxStrategies filed suit against CVS and Wellpartner alleging claims for illegal tying in violation of the Sherman Act against both Defendants (Count I); breach of contract against CVS (Count II); tortious interference with a contractual relationship against both Defendants (Count III); tortious interference with a business relationship against both Defendants (Count IV); misappropriation of trade secrets against both Defendants (Counts V and VI); fraud in the inducement against CVS (Count VII); fraudulent misrepresentation against CVS (Count VIII); negligent misrepresentation against CVS (Count IX); and unjust enrichment against CVS (Count X). Defendants move to dismiss RxStrategies' Amended Complaint.

MOTION TO DISMISS STANDARD

Federal Rule of Civil Procedure 12(b)(6) allows a court to dismiss a complaint when it fails to state a claim upon which relief can be granted. When reviewing a motion to dismiss, a court must accept all factual allegations in the complaint as true. Erickson v. Pardus , 551 U.S. 89, 94, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007) (internal citation omitted). It must also construe those factual allegations in the light most favorable to the plaintiff. Hunt v. Aimco Properties, L.P. , 814 F.3d 1213, 1221 (11th Cir. 2016) (internal citation omitted).

*1348To withstand a motion to dismiss, the complaint must include "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). A claim has facial plausibility "when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). Pleadings that offer only "labels and conclusions," or a "formulaic recitation of the elements of a cause of action," will not do. Twombly, 550 U.S. at 555, 127 S.Ct. 1955.

DISCUSSION

Count I: Tying in Violation of the Sherman Act, 15 U.S.C. § 1, against both Defendants

As an initial matter, the Court notes that RxStrategies is required to establish antitrust standing to assert its antitrust claim. See Palmyra Park Hosp. Inc. v. Phoebe Putney Mem'l Hosp. , 604 F.3d 1291, 1298 (11th Cir.

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390 F. Supp. 3d 1341, Counsel Stack Legal Research, https://law.counselstack.com/opinion/rxstrategies-inc-v-cvs-pharmacy-inc-flmd-2019.