United States District Court, D. Massachusetts
Meijer, Inc. and Meijer Distribution, Inc. on behalf of themselves and all others similarly situated, Plaintiffs,
Ranbaxy Inc. and Sun Pharmaceutical Industries Ltd., Defendants.
MEMORANDUM & ORDER
Nathaniel M. Gorton, United States District Judge
case involves a putative class action brought by plaintiffs
Meijer, Inc. and Meijer Distribution, Inc., (jointly,
“Meijer” or “plaintiffs”) against
Ranbaxy, Inc. and related entities (“Ranbaxy”)
and Sun Pharmaceutical Industries, Ltd. (“Sun
Pharma”) (jointly, “defendants”) for
antitrust and Racketeer Influenced and Corrupt Organizations
Act (“RICO”) violations.
September, 2015, defendants filed a motion to dismiss for
failure to state a claim pursuant to Fed.R.Civ.P. 12(b)(6),
which was referred to United States Magistrate Judge M. Page
Kelley for a Report and Recommendation
(“R&R”). The R&R was filed with this
session on June 16, 2016. It was accepted and adopted whereby
defendants' motion to dismiss was denied. On October 7,
2016, defendants filed a motion requesting that this Court
certify that Order for interlocutory appeal. For the
following reasons, the motion will be allowed.
2015, plaintiffs brought this action on behalf of themselves
and as representatives of a direct purchaser class. Their
complaint contains four counts against defendants: violations
of the Sherman Act, 15 U.S.C. § 2, (Counts I and II) and
violations of RICO, 18 U.S.C. § 1962(c) and (d) (Counts
III and IV, respectively).
September, 2015, defendants moved to dismiss plaintiffs'
allegations for failure to state a claim upon which relief
can be granted, pursuant to Fed.R.Civ.P. 12(b)(6). They
sought dismissal of plaintiffs' claims by asserting,
inter alia, that the claims were precluded by the
Federal Drug and Cosmetic Act (“FDCA”), 21 U.S.C.
§ 301 et. seq. In support of that proposition,
defendants relied on the decision of the United States
Supreme Court in Buckman Co. v. Plaintiff's Legal
Comm., 531 U.S. 341 (2001) and 21 U.S.C. § 337(a).
Buckman, the plaintiffs brought state-law tort
claims against a consultant for injuries caused by orthopedic
bone screws, alleging that the defendant made fraudulent
representations to the Food and Drug Administration
(“FDA”) in the course of obtaining approval to
market the screws. 531 U.S. at 343. The Supreme Court found
that federal law preempted state-law tort claims for fraud on
the FDA. Id. at 349.
defendants assert that Buckman should be read
expansively to prohibit all claims predicated on fraud on the
FDA, not just state-law claims. They note that the Supreme
Court in Buckman focused on the explicit bar against
private action in 21 U.S.C. § 337(a).
defendants emphasize the Supreme Court's reasoning that
state-law fraud-on-the-FDA claims would conflict with and
burden the FDA in ways not contemplated by Congress. They
contend that this rationale is applicable regardless of
whether the claims are based on state or federal law. By
their reading, the key distinction in Buckman is
between private litigants and the federal government, not the
underlying source of the claims.
January, 2016, this Court referred the motion to dismiss to
Magistrate Judge M. Page Kelley. After hearing, she entered a
R&R, recommending that the motion be allowed on all
counts against Ranbaxy Laboratories Limited and Ranbaxy USA,
Inc. Plaintiffs did not oppose that dismissal. Magistrate
Judge Kelley also recommended that the motion to dismiss be
denied as to all counts against Ranbaxy and Sun Pharma. On
September 7, 2016, after considering the parties'
objections, this session accepted and adopted the R&R,
granting, in part, and denying, in part, defendants'
motion to dismiss.
accepting and adopting the R&R, this Court concluded that
plaintiffs' Sherman Act and RICO claims against Ranbaxy
and Sun Pharma ought to proceed. Although their claims
presented a matter of first impression for which Supreme
Court precedent was not precisely on point, this Court found
that the Sherman Act and RICO claims were not precluded by
the FDCA under Buckman's preemption analysis.
Instead, the Court agreed with plaintiffs and applied POM
Wonderful LLC v. Coca-Cola Co., 134 S.Ct. 2228 (2014).
POM, the Supreme Court analyzed the overlap of the
Lanham Act, 15 U.S.C. § 1125, and the FDCA as a matter
of statutory interpretation not preclusion. POM Wonderful
LLC, 134 S.Ct. at 2236. It noted that
when two statutes complement each other, it would show
disregard for the congressional design to hold that Congress
nonetheless intended one federal statute to preclude the
operation of the other.
Id. Accordingly, in this case, after finding that
the relevant statutes do not conflict and that plaintiff
appropriately alleged violations of the Sherman Act and RICO,