A Trenton federal judge has dismissed a False Claims Act suit against Sanofi and Bristol-Myers Squibb over anti-blood clot drug Plavix, citing a change in the composition of the partnership that filed the suit.
The defendants in United States, ex rel. JKJ Partnership 2011 v. Sanofi Aventis U.S., filed in October 2011, are accused of failing to disclose that about 30 percent of the general public was genetically disposed to show diminished or no response to Plavix, including many African-Americans and Asian-Americans. The suit was filed by JKJ Partnership 2011, and became part of the consolidated litigation over Plavix, which is ongoing.
The partnership’s three members—two doctors and a Sanofi marketing representative—remained anonymous. But in February 2017, one of the members left the partnership, and was replaced by a physician named Paul Gurbel, according to the Wednesday decision from U.S. District Judge Freda Wolfson.
After the change in membership in the partnership, Wolfson asked the parties to brief whether Gurbel was a proper relator capable of continuing the litigation. In response, Bristol-Myers and Sanofi moved to dismiss. The defendants argued, among other things, that if JKJ is the relator, its claims are precluded by the FCA’s public disclosure bar, and that JKJ’s continuation as plaintiff after the substitution of Gurbel is prohibited by the act’s first-to-file bar.
The public disclosure bar under the FCA statute places restrictions on claims that are based on information previously disclosed in government reports, court proceedings or the news media.
Bristol-Myers and Sanofi identified four sources for public disclosures in the present case: documents from a product liability suit concerning Plavix in New Jersey, Hall v. Bristol-Myers Squibb, and Arizona, Mills v. Bristol-Myers Squibb, and news articles discussing the Arizona case.
Wolfson, in Wednesday’s decision, rejected defendants’ motion to dismiss based on the public disclosure bar. In the Hall case, defendants cited a letter from the magistrate judge, referencing an allegation that Bristol-Myers “knew for many years that over 30 percent of the people taking Plavix incur no benefit.” The Mills case relied on a study about Plavix that was also cited in the JKJ case. But the study referenced in Mills revealed “only the Y—the true factual circumstance that Plavix was not effective for a substantial portion of the population based on their genetics—not the X—any misrepresentation by Defendants,” Wolfson said. Likewise, the court document from the Hall case referenced the fact that 30 percent of Plavix users incur no benefit, but the alleged misrepresentation is absent, Wolfson said. And the news articles concerning the Mills case don’t disclose anything more than the complaint, and make no allegations of misrepresentation by the defendants, Wolfson said.
The judge ruled differently on the first-to-file issue, however.
JKJ argued that the departure of the original partner did not dissolve the partnership, and the addition of Gurbel did not result in the creation of a new partnership. The defendants countered that the loss of one member and the addition of another gives rise to formation of a new partnership.
Wolfson, applying Delaware law on corporations, said that after the departure of JKJ’s original members from the corporation, the remaining partners could not retain the benefits of a separate JKJ entity for litigation purposes.
“Any finding to the contrary would lead to the absurd result that JKJ would be permitted to proceed as a relator because it is legally indistinguishable from, and therefore directly possesses the knowledge of, its members, but would also be permitted to change its membership without becoming a different legal entity because it is legally independent and distinguishable from its present membership,” Wolfson said.
“Put simply, JKJ cannot have it both ways. As part of a litigation strategy to maintain their anonymity, JKJ’s original partners formed a non-entity partnership arguably capable of serving as a source of information concerning events which transpired before its formation on the basis of its partners’ personal knowledge. Having obtained these benefits at filing, JKJ cannot now be treated as an entity partnership capable of persisting in the litigation through a change in membership,” Wolfson said.
In light of Wolfson’s finding that JKJ could not proceed as relator, the partnership asked the court for permission to file a third amended complaint naming its individual members, as well as JKJ, as the relators. But Wolfson denied that motion, saying that to do so would be contrary to the U.S. Supreme Court’s 2009 holding in U.S. ex rel. Eisenstein v. City of New York, that a nonparty can become a party to litigation only through intervention even where the nonparty is a real party in interest.
Wolfson was assigned the litigation as part of a 2013 consolidation of FCA and personal injury cases concerning Plavix. Sanofi and Bristol-Myers market the drug in the U.S. through a joint venture.
Scott Simmer of Baron & Budd in Washington, D.C., who represented JKJ Partnership, did not return a call about the case. Nathan Finch of Motley Rice in Washington, D.C., who also represented JKJ, deferred comment to Simmer. Gavin Rooney of Lowenstein Sandler in Roseland, who represented Sanofi and Bristol-Myers, also did not return a call.