Corcoran et al v. CVS Health Corporation

Northern District of California, cand-4:2015-cv-03504

Memorandum in Support of CVS MIL #1

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1 Enu Mainigi (admitted pro hac vice) ork Grant A. Geyerman (admitted pro hac vice) 2 WILLIAMS & CONNOLLY LLP 725 Twelfth Street, N.W. 3 Washington, DC 20005 4 Telephone: (202) 434-5000 Facsimile: (202) 434-5029 5 Edward W. Swanson (Cal. Bar No. 159859) 6 August Gugelmann (Cal. Bar No. 240544) 7 SWANSON & MCNAMARA LLP 300 Montgomery Street, Suite 1100 8 San Francisco, CA 94104 Telephone: (415) 477-3800 9 Facsimile: (415) 477-9010 10 Attorneys for Defendant CVS Pharmacy, Inc. 11 12 IN THE UNITED STATES DISTRICT COURT 13 FOR THE NORTHERN DISTRICT OF CALIFORNIA 14 OAKLAND DIVISION 15 16 Christopher Corcoran, et al., Case No. 15-cv-03504-YGR 17 Plaintiffs, CLASS ACTION 18 v. CVS'S MOTION IN LIMINE #1: 19 TO PRECLUDE REFERENCES TO CVS Pharmacy, Inc., OTHER HSP LEGAL PROCEEDINGS 20 Date: May 13, 2020 21 Defendant. Time: 9:30 a.m. 22 Courtroom: 1 Judge: Hon. Yvonne Gonzalez Rogers 23 24 25 26 27 28 CVS MIL #1: TO PRECLUDE REFERENCES CASE NO. 15-CV-03504-YGR TO OTHER HSP LEGAL PROCEEDINGS 1 Throughout this case, Plaintiffs routinely have mentioned that CVS is or has been involved in 2 multiple other lawsuits and government investigations concerning the Health Savings Pass ("HSP") 3 program, as though the existence of other proceedings somehow proves HSP is improper.1 Plaintiffs 4 should not be permitted to inject these other HSP matters into the trial. Their only purpose for doing 5 so would be to portray CVS to the jury as a "bad" company because others have sued it, or to suggest 6 Plaintiffs' allegations are meritorious because other litigants have also asserted HSP-related claims. 7 Neither purpose is permissible under the Federal Rules. Because CVS's other lawsuits (including any 8 pre-suit investigations) will not be not relevant to any claim or defense at trial, and could only unfairly 9 prejudice CVS, the Court should bar any argument or evidence at trial about these legal proceedings.2 10 ARGUMENT 11 CVS's other HSP matters are not relevant to this case. See Fed. R. Evid. 401, 402. The matter 12 before this Court is the only HSP case in which customers at CVS pharmacies claim that CVS's non- 13 submission of HSP prices caused them to pay higher copayments. All other HSP cases have 14 concerned statutes, regulations, or contracts that are not at issue here, and the plaintiffs always have 15 been third-party payors (or their proxies), rather than customers. In addition, none of the other matters 16 has resulted in any admission or determination of liability. That other matters exist demonstrates only 17 that other parties, like Plaintiffs, have made unproven allegations against CVS. They are, therefore, 18 19 1 United States ex rel. Winkelman v. CVS Caremark Corp., No. 11-11398-DJC (D. Mass.) (including 20 pre-suit investigation); Sheet Metal Workers Local No. 20 Welfare and Benefit Fund v. CVS 21 Pharmacy, Inc., No. 1:16-cv-00046-WES-PAS (D.R.I.); Plumbers Welfare Fund, Local 130 v. CVS Health Corp., 1:16-cv-00447-S (D.R.I); State of Texas ex rel. Winkelman v. CVS Health Corp., No. D- 22 1-GV-14-00038 (353rd Dist. Ct. Travis Cnty. Tex.) (including pre-suit investigation); State of 23 California ex rel. Omlansky v. CVS Caremark Corp., No. 34-2013-00147458 (Sacramento Cty., Cal. Super. Ct.); Mississippi v. CVS Health Corp., 17-cv-00030-CW (DeSoto Cty., Miss. Cir. Ct.); and 24 Civil Investigative Demand, Connecticut Attorney General's Office (June 24, 2010). 25 2 This Motion is not intended to prevent the parties from referencing the fact that Connecticut, in 2010, 26 amended its Medicaid definition of usual and customary. That amendment occurred contemporaneous with the Connecticut Attorney General's investigation into CVS's ability to discontinue the HSP 27 program at its Connecticut pharmacies. The investigation was not about whether CVS should have, but failed to, submit the HSP price as U&C under state law. Shortly after the amendment, the 28 company reimbursed the State on a going-forward basis for the difference between its U&C price and the HSP price. CVS MIL #1: TO PRECLUDE REFERENCES CASE NO. 15-CV-03504-YGR TO OTHER HSP LEGAL PROCEEDINGS 1 1 irrelevant and inadmissible. See Bd. of Trs. AFTRA Ret. Fund v. JPMorgan Chase Bank, N.A., 860 F. 2 Supp. 2d 251, 254–55 (S.D.N.Y. 2012) (excluding "evidence of the existence of similar lawsuits" and 3 noting that "courts generally exclude evidence of other related lawsuits"); see also Apple iPod iTunes 4 Antitrust Litig., 2014 WL 12719192, at *3 (N.D. Cal. Nov. 18, 2014) (excluding as irrelevant evidence 5 regarding "regulations, investigations, or other actions"); Realtek Semiconductor Corp. v. LSI Corp., 6 2014 WL 46997, at *7 (N.D. Cal. Jan. 6, 2014) (evidence of other similar lawsuits excluded as 7 "irrelevant to the issues in the present case"). 8 The other matters also are inadmissible for multiple other reasons: 9 First, it would unfairly prejudice CVS for Plaintiffs to use the other matters to portray CVS as 10 a "bad" or "unseemly" company generally. Mentioning other litigation carries an inherently high risk 11 of prejudice to the defendant. See, e.g., Gillis v. Murphy-Brown, LLC, 2018 WL 5831994, at *2 12 (E.D.N.C. Nov. 7, 2018) ("The danger of allowing evidence of other lawsuits is obvious—a jury might 13 be tempted into punishing a defendant for behavior for which it is not on trial."); In re Homestore.com, 14 Inc., 2011 WL 291176, at *1 (C.D. Cal. Jan. 25, 2011) ("reference to or evidence of [party's] 15 involvement in other litigation prior to this Action is also irrelevant and carries with it a high risk of 16 prejudice"); In re Ford Motor Co. DPS6 Powershift Transmission Prod. Liab. Litig., 2019 WL 17 7185548, at *3 (C.D. Cal. Dec. 9, 2019) (excluding evidence of other lawsuit as "highly likely" to 18 "invit[e] the jury to speculate and base its decision on improper considerations"). The evidence of 19 other proceedings therefore should be excluded under Fed. R. Evid. 403 20 Second, given Rule 802's prohibition on hearsay evidence, Plaintiffs cannot use the prior 21 matters to prove the truth of their allegations—namely, that HSP prices were, in fact, usual and 22 customary prices, or that CVS's non-submission of those prices was, in fact, a violation of law. See 23 Smith v. E-backgroundchecks.com, Inc., 2015 WL 11233453, at *1 (N.D. Ga. June 4, 2015) 24 ("Evidence of other lawsuits is generally considered to be inadmissible hearsay."). 25 Third, two of the six matters have concluded: United States ex rel. Winkelman (D. Mass.) and 26 State of Texas ex rel. Winkelman (353rd Dist. Ct. Travis Cnty. Tex.). Plaintiffs likely have no interest 27 in informing the jury of the outcome of either case: The Winkelman case was dismissed outright, and 28 the court in the Texas case entered a directed verdict for CVS on the largest part of the case before the CVS MIL #1: TO PRECLUDE REFERENCES CASE NO. 15-CV-03504-YGR TO OTHER HSP LEGAL PROCEEDINGS 2 1 parties settled the remainder. To the extent Plaintiffs wish to inform the jurors of the Texas settlement, 2 however, Rule 408 expressly forbids that. See, e.g., In re Tenet Healthcare Corp. Sec. Litig., 2007 3 WL 5673884, at *1 (C.D. Cal. Dec. 5, 2007) (excluding evidence of defendant's settlements with 4 governmental agencies under Rule 408). 5 Fourth, introducing evidence of CVS's other matters would only cause confusion and prolong 6 the trial—all in violation of Rule 403. See Gribben v. United Parcel Serv., Inc., 528 F.3d 1166, 1172 7 (9th Cir. 2008) (affirming exclusion of "no-fault" settlement because "it was irrelevant and would 8 have been unduly prejudicial, confusing, and misleading"). Confusion is likely because the other 9 matters each involved statutes, regulations, or contracts containing definitions of "usual and 10 customary" separate and distinct from the definitions in the PBM contracts in this case. Furthermore, 11 the other cases asserted different legal causes of action: federal and state false claims statutes, RICO, 12 and the consumer protection statutes of states other than the six at issue in this case. If the other 13 matters are allowed at trial, CVS would be required to delve into these details with the jury to place 14 the other matters in context. See, e.g., In re Ford Motor Co. DPS6 Powershift Transmission Prod. 15 Liab. Litig., 2019 WL 7185548, at *3 (granting motion in limine to exclude evidence of other litigation 16 because the evidence "invites a trial-within-a trial, and would likely cause confusion and waste time— 17 concerns that run afoul of Fed. R. Evid. 403"); Smith, 2015 WL 11233453, at *2 (other lawsuits 18 generates "a series of mini-trials that would likely confuse and mislead the jury from the task at hand. 19. . and result in a waste of time and judicial resources"). This will only be a waste of everyone's time, 20 and add complexity to what already will be a factually and legally complex class action trial. 21 CONCLUSION 22 For the foregoing reasons, the Court should grant CVS's motion in limine to exclude reference 23 to the other HSP-related lawsuits and government investigations identified in note 1 above. 24 25 Dated: April 15, 2020 Respectfully submitted, 26 27 By: /s/ Grant A. Geyerman ______________ 28 Enu Mainigi (admitted pro hac vice) CVS MIL #1: TO PRECLUDE REFERENCES CASE NO. 15-CV-03504-YGR TO OTHER HSP LEGAL PROCEEDINGS 3 1 Grant A. Geyerman (admitted pro hac vice) WILLIAMS & CONNOLLY LLP 2 725 Twelfth Street, N.W. Washington, DC 20005 3 Telephone: (202) 434-5000 4 Facsimile: (202) 434-5029 5 Edward W. Swanson (Cal. Bar No. 159859) 6 August Gugelmann (Cal. Bar No. 240544) SWANSON & MCNAMARA LLP 7 300 Montgomery Street, Suite 1100 8 San Francisco, CA 94104 Telephone: (415) 477-3800 9 Facsimile: (415) 477-9010 10 Attorneys for Defendant CVS Pharmacy, Inc. 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 CVS MIL #1: TO PRECLUDE REFERENCES CASE NO. 15-CV-03504-YGR TO OTHER HSP LEGAL PROCEEDINGS 4