The opinion of the court was delivered by: Robert Simpson, Judge
BEFORE: HONORABLE DAN PELLEGRINI, President Judge HONORABLE BERNARD L. McGINLEY, Judge HONORABLE RENEE COHN JUBELIRER, Judge HONORABLE ROBERT SIMPSON, Judge HONORABLE MARY HANNAH LEAVITT, Judge HONORABLE PATRICIA A. McCULLOUGH, Judge HONORABLE ANNE E. COVEY, Judge
This appeal involves a civil suit by the Commonwealth of Pennsylvania against the manufacturer of a drug, Risperdal, the cost of which is reimbursed through several Commonwealth agencies. The Commonwealth's theory of recovery at trial was that the drug manufacturer, Ortho-McNeil-Janssen Pharmaceuticals, Inc. (Janssen), fraudulently withheld information regarding the safety and efficacy of the drug, thereby misleading those paying for the drug into believing it had a high intrinsic value that justified its price premium over generic alternative drugs. The Commonwealth sought to recover the difference in price between the amount it reimbursed for Risperdal and the drug's true value, which it asserts was about the price of a generic alternative drug.
The Court of Common Pleas of Philadelphia County (trial court) entered orders that dismissed the Commonwealth's suit and denied post-trial relief. The Commonwealth challenges these orders on appeal, raising numerous issues. Upon review, we affirm.
II. Factual and Procedural History
In 2007, the Commonwealth filed suit against three pharmaceutical companies, Janssen, Eli Lilly & Company, Inc., and AstraZeneca Pharmaceuticals, L.P. The Commonwealth claimed it was seeking to recover, among other things, expenses incurred for reimbursing pharmacies for the purchase of Risperdal and other antipsychotic drugs manufactured by these defendants. At that time, the Commonwealth alleged the defendant pharmaceutical companies promoted their respective antipsychotic drugs for non-medically accepted and non-medically necessary (off-label) uses. The Commonwealth also asserted the defendant pharmaceutical companies misrepresented the risks associated with these medicines.
The defendant pharmaceutical companies filed preliminary objections seeking to, among other things, sever the actions. In December, 2007, the trial court severed the claims and directed the Commonwealth to file separate complaints against each of the defendant pharmaceutical companies.
Relevant here, in early-2008, the Commonwealth filed a six-count complaint against Janssen, alleging in Count I-Submission of False & Fraudulent Claims Under Medicaid Program; Count II-Submission of False & Fraudulent Claims Under Pharmaceutical Assistance Contract for the Elderly (PACE) Program; Count III-Negligence; Count IV-Fraud and Misrepresentation; Count V- Misrepresentation Under Restatement (Second) of Torts §402B; and, Count VI-Unjust Enrichment.
In January 2010, the Honorable Howland W. Abramson granted, in part, Janssen's motion for judgment on the pleadings, thereby dismissing the Commonwealth's civil action seeking double damages under the Medicaid fraud statute.
In April 2010, Janssen filed a motion for summary judgment seeking dismissal of the Commonwealth's common law fraud and misrepresentation and unjust enrichment claims. The next day, the Commonwealth filed a motion for leave to file an amended complaint, which the trial court granted. The Commonwealth filed its first amended complaint on May 17, 2010, alleging claims for fraud and misrepresentation and unjust enrichment against Janssen. Janssen filed preliminary objections.
Ultimately, the case proceeded to trial in late May 2010. After jury selection, the trial court held oral argument on Janssen's motion for summary judgment on the Commonwealth's initial complaint, Janssen's preliminary objections to the first amended complaint, and multiple motions in limine filed by the parties.
After opening statements on June 3, 2010, the Commonwealth presented its evidence over the course of one week of jury trial. The Commonwealth rested on June 10, 2010. Shortly thereafter, Janssen made an oral motion for compulsory non-suit, and the parties submitted written memoranda.
On June 14, 2010, the trial court heard oral argument on Janssen's motion for compulsory non-suit. Shortly thereafter, the trial court, through the Honorable Frederica A. Massiah-Jackson, granted Janssen's motion for non-suit. About 10 days later, Judge Massiah-Jackson issued a written decision explaining her ruling in more detail.
Several months later, Judge Massiah-Jackson issued a written decision denying the Commonwealth's request to remove the compulsory non-suit and denying the Commonwealth's motion for post-trial relief. The Commonwealth filed a notice of appeal to this Court, and the trial court directed the Commonwealth to file a statement of matters complained of on appeal pursuant to Pa. R.A.P. 1925(b), which it did. Judges Abramson and Massiah-Jackson subsequently filed opinions pursuant to Pa. R.A.P. 1925(a), further explaining the bases for their respective decisions.
With regard to his dismissal of the Commonwealth's statutory Medicaid fraud claims, Judge Abramson explained that, because Janssen was not a "provider" as defined by the pertinent statutory provision, it could not be the subject of a civil suit under the statute.
As to the Commonwealth's common law fraud and misrepresentation claims, in its opinion denying the Commonwealth's motion for post-trial relief, the trial court initially explained the Commonwealth waived issues that it briefed, but did not state in its motion for post-trial relief.
As to the merits of the Commonwealth's fraud and misrepresentation claims, the trial court determined the Commonwealth did not carry its burden of proving justifiable reliance and causation by clear and convincing evidence.*fn1
Specifically, as to justifiable reliance, the trial court rejected the Commonwealth's claim that because a confidential relationship existed between the parties, it did not need to prove reliance. The trial court determined the Commonwealth and Janssen were sophisticated business entities, and it distinguished the cases upon which the Commonwealth relied. The trial court also rejected the Commonwealth's alternate theory of "fraud on the market" as inapplicable to the current situation.*fn2 Having concluded the Commonwealth was not excused from proving reliance, it determined that it did not prove that essential element.
Regarding causation, the trial court held the Commonwealth did not present evidence that in the absence of Janssen's conduct any physicians in Pennsylvania would have altered their prescription habits. The trial court discussed the Learned Intermediary Doctrine.*fn3
Additionally, the trial court discussed the Commonwealth's claim for damages. More particularly, at trial, the Commonwealth proceeded without a damage expert, although it claimed losses greatly in excess of $100 million. The trial court determined the magnitude and complexity of the case was beyond the experience and understanding of an average juror; therefore, expert testimony was needed to calculate damages. The trial court also determined the magnitude and complexity of the case required that Janssen be provided with an accurate written expert report covering damages, and that Janssen was prejudiced by this lapse. The trial court discussed the fluctuating amounts of damage estimates mentioned during trial.
Further, the trial court explained its decision to grant non-suit as to the Commonwealth's claim for unjust enrichment. It briefly reasoned that because the relationship between the parties was based on a written agreement, an equitable unjust enrichment claim could not lie.
On appeal, the Commonwealth raises several issues. It first asserts the trial court erred in granting judgment on the pleadings and dismissing its statutory Medicaid fraud claims. The Commonwealth next argues the trial court erred in determining it waived all challenges to the trial court's rulings based on its purportedly insufficient post-trial motion. Additionally, the Commonwealth contends the trial court erred in denying its motion for post-trial relief to the extent it found the Commonwealth did not prove by clear and convincing evidence all the elements of its fraudulent misrepresentation and nondisclosure claim. The Commonwealth also maintains the trial court erred in denying its motion for post-trial relief to the extent it found the Commonwealth could not recover on its unjust enrichment claim.
A. Standard and Scope of Review
The scope of review for an appellate court concerning a trial court's denial of a motion to remove a non-suit and grant a new trial is limited to determining whether the trial court abused its discretion or committed an error of law. Thomas v. City of Phila., 804 A.2d 97 (Pa. Cmwlth. 2002). The standard for reviewing a decision to grant a non-suit is that a non-suit may not be granted unless, viewing all the evidence and all reasonable inferences arising from it in the light most favorable to the plaintiff, the jury could not reasonably conclude the elements of the cause of action have been established. Id.
It is also well settled that a jury cannot be permitted to reach its verdict on the basis of speculation or conjecture, and that a judgment of non-suit is properly entered if a plaintiff does not introduce sufficient evidence to establish the elements necessary to maintain an action. Morena v. S. Hills Health Sys., 501 Pa. 634, 462 A.2d 680 (1983). It is the duty of the trial judge to determine, prior to sending the case to the jury, whether or not the plaintiff met this burden. Id.
In addition, as to our review of the trial court's dismissal of the Commonwealth's statutory claim, we are mindful that a motion for judgment on the pleadings is in the nature of a demurrer. Trib Total Media, Inc. v. Highlands Sch. Dist., 3 A.3d 695 (Pa. Cmwlth. 2010), appeal denied, ___ Pa. ___, 24 A.3d 865 (2011). As such, all of the opposing party's allegations are viewed as true and only those facts specifically admitted by him may be considered against him. Id. In reviewing a motion for judgment on the pleadings, a trial court may only consider the pleadings and any documents properly attached to the pleadings. Id. A motion for judgment on the ...