Walmart v. DOJ

21 F.4th 300
CourtCourt of Appeals for the Fifth Circuit
DecidedDecember 22, 2021
Docket21-40157
StatusPublished
Cited by24 cases

This text of 21 F.4th 300 (Walmart v. DOJ) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Walmart v. DOJ, 21 F.4th 300 (5th Cir. 2021).

Opinion

Case: 21-40157 Document: 00516142688 Page: 1 Date Filed: 12/22/2021

United States Court of Appeals for the Fifth Circuit United States Court of Appeals Fifth Circuit

FILED December 22, 2021 No. 21-40157 Lyle W. Cayce Clerk

Walmart Inc.,

Plaintiff—Appellant,

versus

U.S. Department of Justice; U.S. Drug Enforcement Administration; Acting Administrator D. Christopher Evans; Merrick Garland, U.S. Attorney General,

Defendants—Appellees.

Appeal from the United States District Court for the Eastern District of Texas No. 4:20-CV-817

Before Higginbotham, Smith, and Ho, Circuit Judges. Jerry E. Smith, Circuit Judge: Walmart challenges the government’s interpretation of the Con- trolled Substances Act, 21 U.S.C. § 801 et seq. (“CSA”), as it applies to phar- macists who dispense prescription opioids. Or at least, Walmart questions what it says are the government’s interpretations of the CSA—it points to no rule, guidance, or other public document setting forth the positions it seeks to contest. Because it identifies no agency action, as that term is used in the Case: 21-40157 Document: 00516142688 Page: 2 Date Filed: 12/22/2021

No. 21-40157

Administrative Procedure Act (“APA”), the suit is barred by sovereign immunity. And even if it were not, Walmart’s failure to contradict a definite government position means that it has not demonstrated the existence of a ripe case or controversy, as required by Article III. For both reasons, we affirm the judgment dismissing for want of subject-matter jurisdiction.

I. This case arises from the government’s ongoing efforts to combat the epidemic of opioid abuse. Opioids, legal and illegal, are regulated under the CSA, which is administered by the Drug Enforcement Administration (“DEA”). Though opioids are prescribed by doctors, those prescriptions must be filled by pharmacists, who may refuse to fill prescriptions that they deem suspicious, such as prescriptions by disreputable doctors or those involving certain drug combinations. Walmart dispenses prescription opi- oids through its pharmacies; from 2002 to 2018, it also acted as a distributor, shipping opioids from a distribution center to its own pharmacies. Walmart maintains that it has consistently taken appropriate steps to comply with the CSA and keep its pharmacists from dispensing opioids to those who should not receive them. Walmart has long allowed its pharma- cists to refuse to fill individual prescriptions that they believed were not legit- imate; it now has policies allowing pharmacists or Walmart itself categori- cally to refuse to fill prescriptions by individual doctors. Those policies are sufficiently stringent that they have provoked resistance, including adminis- trative investigations and warnings from state regulators as well as com- plaints by private-sector medical associations. Those groups generally main- tain that Walmart’s pharmacists are unduly intervening in the doctor-patient relationship and tarnishing the reputations of individual doctors, some of whom have filed defamation suits. At the same time, the Department of Justice (“DOJ”) has investi-

2 Case: 21-40157 Document: 00516142688 Page: 3 Date Filed: 12/22/2021

gated Walmart for violations of the CSA. Despite abandoning an effort to bring criminal charges against Walmart, DOJ formed a working group to investigate Walmart for civil liability. Walmart thus found itself “between a rock and a hard place”— stringent restrictions on opioid distribution expose it to suit from state and private-sector actors, while lax restrictions expose it to suit from the federal government. To resolve this dilemma, Walmart sued under the Declaratory Judgment Act, 28 U.S.C. § 2201 (“DJA”), in October 2020, requesting that the court make several declarations about the precise limits of pharmacists’ obligations under the CSA. Those requested declarations are as follow: A. Pharmacists may be liable under the CSA and its regulations only when they fill a prescription that they know was not issued for a legiti- mate medical purpose by a prescriber acting in the usual course of the prescriber’s professional practice or when pharmacists knowingly abandon all professional norms; B. The CSA does not require pharmacists to second-guess a registered and licensed doctor’s decision that a prescription serves a legitimate medical purpose; C. The CSA and its regulations do not require pharmacists to refuse to fill entire categories of prescriptions without regard to individual facts and circumstances; D. The CSA and its regulations do not require pharmacists to docu- ment in writing why filling a prescription was appropriate; E. Pharmacies do not have an affirmative obligation under the CSA and its regulations to analyze and share aggregate prescription data across its stores and with line pharmacists; F. Pharmacies do not have an affirmative obligation under the CSA and its regulations to impose corporation-wide refusals-to-fill for particular doctors; G. The CSA and its regulations do not require distributors not to ship suspicious orders after reporting them;

3 Case: 21-40157 Document: 00516142688 Page: 4 Date Filed: 12/22/2021

H. The CSA and its regulations did not impose monetary penalties for failure to report suspicious orders to DEA during the time Walmart self-distributed; and I. Defendants must follow their own regulations and may not base any enforceable legal positions on the alleged violation of agency guidance rather than obligations found in a statute or duly promulgated rule or regulation. Walmart alleges that the government takes the contrary view on all these proposed declarations, but it does not point to any regulations or guidance documents setting forth the government’s position. Indeed, Walmart avers that many of the positions that it challenges “contradict DEA’s own previ- ously expressed views.” Just a few weeks after the filing of this action, before the court could rule on Walmart’s request, the government brought a civil enforcement action against Walmart in the District of Delaware. 1 DOJ did in fact take ver- sions of the positions that Walmart challenges in this action, but Walmart stresses that “the issues in the two suits do not completely overlap.”2 Meanwhile, the government moved to dismiss the present case for

1 United States v. Walmart Inc., No. 20-cv-1744 (D. Del. Dec. 22, 2020). 2 There is a second pending action that has some bearing on this one. A multi- district litigation case has been ongoing in the Northern District of Ohio since 2017. See In re Nat’l Prescription, Opiate Litig., No. 17-md-2804 (N.D. Ohio). Plaintiffs, mostly gov- ernment agencies, accuse numerous defendants, including Walmart, of misconduct in dis- pensing opioids. The Plaintiffs’ Executive Committee moved to have the present case transferred to that case if it is not dismissed. Because it dismissed the present case, the district court did not rule on the motion to transfer, and that motion is not before this court. We take judicial notice of the fact that on November 23, 2021, the jury returned a large verdict against Walmart and others. See CVS, Walmart and Walgreens Fueled Opioid Crisis, US jury finds, The Guardian (Nov, 23, 2021 3:19 PM, https://www.theguardian.com/us-news/2021/nov/23/ohio-cvs-walmart-and-walgreens- opioid-crisis.

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want of subject-matter jurisdiction. The government maintained, inter alia, that Walmart’s suit was barred by sovereign immunity and that it had failed to identify a ripe case or controversy.

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21 F.4th 300, Counsel Stack Legal Research, https://law.counselstack.com/opinion/walmart-v-doj-ca5-2021.