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Physician Specialty Pharmacy, LLC v. Prime Therapeutics, LLC

United States District Court, D. Minnesota

April 19, 2019

Physician Specialty Pharmacy, LLC, Plaintiff,
v.
Prime Therapeutics, LLC, Defendant.

          Adrienne Dresevic and Robert J. Dindoffer, The Health Law Partners, P.C., and Elizabeth R. Odette and Kristen G. Marttila, Lockridge Grindal Nauen P.L.L.P., (for Plaintiff)

          Christine Lindblad, Meghan M.A. Hansen, Ellie J. Barragry, and Alex L. Rubenstein, Fox Rothschild LLP, (for Defendant).

          ORDER

          Tony N. Leung, United States Magistrate Judge

         This matter is before the Court on Plaintiff's Motion for Leave to File Second Amended Complaint. (ECF No. 68). Based on all the files, records, and proceedings herein, and for the reasons set forth below, this Court will grant Plaintiff's motion.

         I. BACKGROUND

         On April 18, 2018, Physician Specialty Pharmacy, LLC (“PSP”) filed suit against Prime Therapeutics, LLC (“Prime”), alleging a variety of federal and state law claims. (ECF No. 1). PSP filed an amended complaint two days later. (ECF No. 6). The complaint centered on allegations that Prime unlawfully withheld payments from PSP and that Prime terminated PSP from its pharmacy network in order to benefit a partnership between Prime and Walgreens.

         Prime moved to dismiss. (ECF No. 18). The motion was referred to this Court for a Report and Recommendation. (ECF No. 25). Following argument in the matter, this Court recommended that the federal claims be dismissed for failure to state a claim and that the state law claims be dismissed for lack of jurisdiction. (ECF No. 62). This Court also recommended that PSP be allowed to file an amended complaint. Both parties objected to the Report and Recommendation. (ECF Nos. 64 and 65).

         Before the District Judge could rule on the Report and Recommendation, PSP filed a motion for leave to file a second amended complaint. (ECF No. 68). In response, Prime sought an urgent telephonic hearing, asking that the Court not consider the motion because objections to the Report and Recommendation were pending and because PSP did not meet-and-confer with Prime before filing the motion. (ECF No. 73). Alternatively, Prime sought an additional 30 days to respond to the motion. (ECF No. 73). The Court denied the request for a telephonic conference, but extended the deadline for Prime to respond to PSP's motion until April 17, 2019. (ECF No. 74). The Court rescheduled the motion hearing for April 24, 2019.

         Shortly thereafter, the District Judge adopted the Report and Recommendation, concluding “that PSP has failed to plausibly plead antitrust claims under federal law and that PSP should be allowed the opportunity to file an amended complaint.” (ECF No. 75). The District Judge declined to address whether it was appropriate to exercise supplemental jurisdiction over the state law claims. (ECF No. 75).

         Prime then filed its memorandum in opposition to PSP's motion for leave to file a second amended complaint. (ECF No. 77). Prime's memorandum was 54 pages long and 11, 997 words, just three words short of the word limit provided for by the Court's local rules. LR 7.1(f). With the exception of one page in its memorandum, Prime argued that the Court should deny PSP's motion because the proposed amendments would be futile. Prime also filed a declaration containing approximately 130 pages of exhibits. (ECF No. 78).

         This time it was PSP's turn to file a letter seeking an urgent telephonic hearing. (ECF No. 79). PSP argued that Prime's memorandum constituted an “an improperly-filed motion to dismiss.” (ECF No. 79). PSP asked that the Court strike Prime's memorandum or provide it “equal and adequate time to reply.” (ECF No. 79). PSP requested an additional 30 days to draft such a memorandum. (ECF No. 79). Prime file a letter opposing PSP's requests. (ECF No. 80).

         II. MOTION TO AMEND

         Once 21 days have passed after service of a responsive pleading, a party “may amend its pleading only with the opposing party's written consent or the court's leave.” Fed.R.Civ.P. 15(a)(2). “Although leave to amend ‘shall be freely given when justice so requires,' see Fed. R. Civ. P. 15(a), plaintiffs do not have an absolute or automatic right to amend.” United States ex rel. Lee v. Fairview Health Sys., 413 F.3d 748, 749 (8th Cir. 2005) (citing Meehan v. United Consumers Club Franchising Corp., 312 F.3d 909, 913 (8th Cir. 2002)). The Court may deny a party's request for leave to amend only “if there are compelling reasons such as undue delay, bad faith, or dilatory motive, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the non-moving party, or futility of the amendment.” Reuter v. Jax Ltd., Inc., 711 F.3d 918, 922 (8th Cir. 2013) (quoting Sherman v. Winco Fireworks, Inc., 532 F.3d 709, 715 (8th Cir. 2008)). “[A] motion to amend should be denied on the merits ‘only if it asserts clearly frivolous claims or defenses.'” Becker v. Univ. of Nebraska at Omaha, 191 F.3d 904, 908 (8th Cir. 1999) (quoting Gamma-10 Plastics, Inc. v. American President Lines, Ltd., 32 F.3d 1244, 1255 (8th Cir. 1994)).

         It is appropriate to grant leave to amend here for several reasons. First, the Court has already considered whether it would be possible for PSP to plead sufficient facts to support a plausible federal antitrust claim. The Court concluded that such a pleading was possible and therefore determined that it would be in the interest of justice to permit PSP to file an amended complaint. Such a result is common after a court grants a motion to dismiss, particularly in a complex case such as this. See Medafor, Inc. v. Starch Medical, Inc., No. 09-cv-441, 2009 WL 2163580, at *2 (D. Minn. July 16, 2009) (permitting party to file amended complaint “to cure the deficiencies identified in this opinion”); In re Buca Inc. Sec. Lit., No. 05-cv-1762, 2006 WL 3030886, at *17 (D. Minn. Oct. 16, 2006) (granting leave to file new complaint “focusing” on deficiencies raised by court's order granting motion to dismiss); In re Navarre Corp. Sec. Lit., No. 05-cv-1151, 2006 WL 1795141, at *4 (D. Minn. June 28, 2006) (granting leave to replead following decision on motion to dismiss). The Court's decision is also consistent with United States Supreme Court precedent holding that ...


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