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James Kerrigan v. Otsuka America Pharmaceutical

October 31, 2012

JAMES KERRIGAN
v.
OTSUKA AMERICA PHARMACEUTICAL, INC., ET AL.



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

MEMORANDUM

This case arises from the plaintiff's termination from employment at Otsuka America Pharmaceutical, Inc. ("OAPI). The plaintiff, James Kerrigan, brings claims under the New Jersey Conscientious Employee Protection Act ("CEPA"), the New Jersey Law Against Discrimination ("NJLAD"), and common law claims for intentional infliction of emotional distress, negligent infliction of emotional distress, misrepresentation, and defamation.

Defendants OAPI and Mark Altmeyer now move to dismiss the plaintiff's complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). The Court will grant the motion and dismiss with prejudice the NJLAD, intentional infliction of emotional distress, negligent infliction of emotional distress, and misrepresentation counts and dismiss the CEPA and defamation claims without prejudice.

I. Facts as Stated in the Complaint Kerrigan was hired on January 12, 2006 at Otsuka Pharmaceutical Development and Commercialization, Inc., as a Senior Director, Global Marketing. He was assigned responsibility for the marketing of the drug Samsca in the United States, reporting through OAPI. Compl. ¶10.

From 2009 until his termination, Kerrigan was the "brand lead" for Samsca. Compl. ¶12.

In 2011, Kerrigan learned about an article written by a web site known as Today's Hospitalist about Samsca. The article had used information from an OAPI sponsored panel, and proper disclosures and fair balance were missing. Compl. ¶24.

Kerrigan reported the publication to his superior in the company. Compl. ¶25. After the Today's Hospitalist incident, OAPI made an inquiry into other potential issues. In response, Kerrigan notified his supervisor of newsletters published in 2010 by Premiere Healthcare Resources, Inc., that were not fair and balanced. Compl. ¶28.

OAPI provides in its Comprehensive Compliance Program: "Procedures for Reporting Violations. The Company's Code of Conduct requires employees to report any known or suspected violations of law, regulations, company policies or procedures to their supervisor or to the Chief Compliance Officer." Compl. ¶45.

After Kerrigan reported the compliance issues in the publications, Mark Altmeyer, the President and CEO of OAPI, and HR diminished Kerrigan's personnel evaluation from a rating of 4 out of 5 to 2 out of 5, over the objection of Kerrigan's direct supervisor Beshad Sheldon. Compl. ¶¶34-35.

Altmeyer criticized Kerrigan, saying his "business acumen" was poor and that he had "no insights." Compl. ¶41. Kerrigan received emails at 10:00 PM demanding that reports be prepared by 8:00 AM and was publicly berated in front of his peers. Compl. ¶¶96-97.

On May 29, 2012, Kerrigan was terminated "for cause" for "putting the company at risk." Compl. ¶66. The complaint alleges that the termination "for cause" had no basis in OAPI policy, but was done to retaliate against Kerrigan for his reporting a possible compliance issue.

II. Discussion

The plaintiff's complaint alleged six counts: (1)

violation of CEPA; (2)violation of the NJLAD; (3) intentional infliction of emotional distress; (4) negligent infliction of emotional distress; (5) misrepresentation; and (6) defamation. In the briefing on the motion to dismiss, the plaintiff conceded that the negligent infliction of emotional distress claim is not viable so the Court will dismiss that count with prejudice.

Of the remaining counts, the defendants argued that the NJLAD, intentional infliction of emotional distress, and defamation counts should be barred by the waiver provision of CEPA, or, in the alternative, that each fails to state a claim. The defendants also argue that the complaint's CEPA and misrepresentation counts fail to state a claim.

When evaluating a motion to dismiss, the Court accepts all well-pleaded facts in the complaint as true and draws all reasonable inferences in favor of the non-moving party, while disregarding any legal conclusions. See Fowler v. UPMC Shadyside, 578 F.3d 203, 210-11 (3d Cir. 2009).

To survive a motion to dismiss, a complaint must contain sufficient factual matter that, when accepted as true, is able to "state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009); Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). A plaintiff cannot rest "on a formulaic recitation of the elements" or mere "labels and conclusions," because "[f]actual allegations must be enough to raise a right to relief above the speculative level." Twombly, 550 U.S. at 545, 555 (citations omitted).

With those principles in mind, the Court considers each of the contested ...


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