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American Federation of State County and Municipal v. Ortho-Mcneil-Janssen Pharmaceuticals

December 21, 2010

AMERICAN FEDERATION OF STATE COUNTY AND MUNICIPAL EMPLOYEES, DISTRICT COUNCIL 47 HEALTH AND WELFARE FUND, ET AL. PLAINTIFF,
v.
ORTHO-MCNEIL-JANSSEN PHARMACEUTICALS, INC., ET AL. DEFENDANTS.



The opinion of the court was delivered by: Rufe, J.

MEMORANDUM OPINION AND ORDER

Before the Court are Defendants' Motions to Compel Plaintiffs to Produce Documents to Defendants' First Set of Requests for Production and to Provide Complete Answers to Defendants' First Set of Interrogatories ("Motion to Compel") [doc. no. 40] and to Extend Deadlines [doc. no. 41]. For the reasons that follow, Defendants' Motions to Compel and Extend are denied in part and granted in part.

I. Factual and Procedural Background

The facts and posture of this case are well-known to the Parties, so the Court provides only a brief recitation of the pertinent details. In December 2008, the Health and Welfare Funds of two local unions-AFSCME District Council 47 ("AFSCME") and Philadelphia Firefighters Union Local No. 22 Health ("PFU")-filed this putative class action on behalf of themselves and similarly situated third-party payors. Plaintiffs provide medical coverage, including prescription drug coverage, to their members and their members' dependents.*fn1 Defendants Ortho-McNeil-Jannsen Pharmaceuticals, Inc. and Sandoz, Inc., market and distribute the prescription-only, fentanyl transdermal system patch ("fentanyl patch"), which is manufactured by Defendant ALZA Corp.*fn2 The Plaintiffs' seek damages from Defendants for alleged violations of the Pennsylvania Unfair Trade Practices and Consumer Protection Law ("UTPCPL"), breach of express and implied warranties, and unjust enrichment arising from a February 2008 recall of all unsold production lots of the fentanyl patches with dosage rates of 25 mcg/hour and expiration dates through December 2009.*fn3 The lots were recalled because some patches in the lots contained cuts in the drug reservoir.*fn4

In March 2009, Defendants filed a motion to dismiss under Rule 12(b)(1) and 12(b)(6). This Court dismissed the two warranty claims but left the UTPCPL and unjust enrichment claims intact.*fn5 The Court rejected Defendants' arguments that Plaintiffs lacked standing because they had not pleaded that their members received patches that were actually defective.*fn6 Plaintiffs' theory of the case is that the benefit funds that purchased the patches on behalf of their plan participants have been injured, not the participants themselves, because, as third-party payors, they "have paid or will pay expenses related to the purchase of and reimbursement for supplies of 25 mcg/hour fentanyl patches [for their members] that were unusable, worthless, and had to be discarded."*fn7 The Court rejected the argument that the only injury from the recall arose from the sale of patches that were actually defective since the recall applied to all suspect production lots.*fn8

After a scheduling conference with this Court, class certification discovery ensued: fact discovery on class certification was scheduled to close on December 15, 2010 and Plaintiffs' Motion for Class Certification is due in early January 2011. Defendants now move this Court to compel Plaintiffs to provide complete responses to their interrogatories and produce all requested documents. Defendants also seek an extension of all pending deadlines in this case by 120 days to account for delays in Plaintiffs' production and to provide additional time for depositions.

II. The Discovery Dispute

Defendants assert that Plaintiffs' responses to their May 2010 interrogatories and production requests were both untimely and substantively insufficient. Defendants complain that despite substantial prodding by Defendants, neither named Plaintiff submitted any interrogatory responses until September 10; PFU did not produce documents until September 10; and AFSCME waited until November 23 to make their first production.*fn9 Defendants assert that the interrogatory responses are deficient and that of the documents Plaintiffs ultimately produced, few mentioned the fentanyl patch at all, and none mentioned defective fentanyl patches or the 2008 recall underlying this action.

Defendants' Motion to Compel seeks interrogatory responses and documents in two primary categories: (1) documents Plaintiffs identified in their responses as discoverable, but failed to provide; and (2) "whole categories of other responsive documents and information."*fn10

Documents in the first category include:

* Spreadsheets of Plan Payments prepared by Plaintiffs' benefits administration companies in response to requests for information about fentanyl patches affected by the recall;*fn11

* Documents relating to Defendants' requests for information about Plaintiffs' expenditures on the recalled patches;*fn12

* Any non-privileged documents relating to communications between Plaintiffs and their Pharmacy Benefits Managers ("PBMs") regarding the recall, the patches, the ...

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