United States District Court, E.D. New York
UNITED STATES OF AMERICA; THE COMMONWEALTHS OF MASSACHUSETTS AND VIRGINIA; THE STATES OF CALIFORNIA, DELAWARE, CONNECTICUT, MARYLAND, COLORADO, FLORIDA, GEORGIA, ILLINOIS, INDIANA, HAWAII, LOUISIANA, MICHIGAN, MONTANA, NEW HAMPSHIRE, NEW MEXICO, NEW YORK, NEVADA, TENNESSEE, NEW JERSEY, RHODE ISLAND, OKLAHOMA, WISCONSIN, NORTH CAROLINA, MINNESOTA AND WASHINGTON, THE CITY OF CHICAGO AND THE DISTRICT OF COLUMBIA ex rel. ALLISON ZAYAS, Plaintiff-Relator,
ASTRAZENECA BIOPHARMACEUTICALS, INC., ASTRAZENECA PLC, ASTRAZENECA, LP, and ASTRAZENECA PHARMACEUTICALS, LP, Defendants.
the Plaintiff-Relator Meredith Tavenner Shepherd-Demings
Kenney & McCafferty, P.C.
the Defendants John C. Dodds Morgan, Lewis & Bockius LLP.
MEMORANDUM AND ORDER
FREDERIC BLOCK, SENIOR UNITED STATES DISTRICT JUDGE
Allison Zayas (“plaintiff”) brought a qui
tam suit under the False Claims Act (“FCA”)
and multiple related state-law causes of action against
defendants Astrazeneca Biopharmaceuticals, Inc.; Astrazeneca
PLC; Astrazeneca, LP; and Astrazeneca Pharmaceuticals, LP
(together, “defendants”). In her Amended
Complaint, plaintiff alleges that defendants (1) marketed
Seroquel IR and Seroquel XR (together,
“Seroquel”) as safe to be prescribed with QT/QTc
prolonging medications when they knew of the risks of such
concomitant prescriptions, and (2) engaged in off-label
promotion of Seroquel, and that both of these actions led to
the submission of false claims for payments to state and
federal governments. Defendants now move to dismiss
plaintiff's off-label promotion claims pursuant to
Federal Rule of Civil Procedure 12(b)(1), and all of
plaintiff's claims under Rule 12(b)(6). For the following
reasons, the Rule 12(b)(1) motion is GRANTED and the Rule
12(b)(6) is DENIED as to the QT/QTc federal claim in Count
One and GRANTED as to Count Two.
first-to-file rule under the FCA bars any new claim if it is
“related” to an FCA claim in an already-pending
action. See 31 U.S.C. § 3730(b)(5) (“[N]o
person other than the Government may intervene or bring a
related action based on the facts underlying the pending
action . . . .”). When considering a challenge under
that rule, a court must therefore determine if a new FCA
claim is related to an already-pending FCA claim. To do so,
the Court will apply the test used by the majority of
Circuits-the essential claim test-which looks not to whether
the more recently-filed FCA claim is identical to an
FCA claim in an already-pending action, but to “whether
the complaints allege the same material facts, i.e.
whether they involve the same core conduct, and would give
rise to separate recovery.” Id. at 76.
argue that plaintiff's off-label promotion claim is
barred by the first-to-file rule-and this Court therefore
does not have subject matter jurisdiction over such
claim-because it is based on the same facts as an
earlier-filed case in Delaware, which also alleges off-label
promotion. In rebuttal, plaintiff argues that her claim is
distinct because (1) she alleges off-label promotion to treat
different diseases than those alleged to have been promoted
off-label in the Delaware action, (2) she alleges off-label
promotion of Seroquel IR, whereas the Delaware action
concerns off-label promotion of Seroquel XR, a different
drug, and (3) the Delaware action is no longer pending.
first argument is unavailing. The False Claims act bars any
person from bringing a related action based on the
facts underlying an already-filed action. To find that
plaintiff could avoid the first-to-file bar by enumerating
different diseases for which defendants promoted the same
prescription drug off-label would mean transforming the
statute's language from “related
action” to “identical action.”
See 31 U.S.C. § 3730(b)(5). It would also mean
disregarding the First Circuit's well-reasoned
application of the essential element test, which concluded
that “promotion of off-label uses of the two same
drugs, but tied to [different] diseases and symptoms . . .
[is] not enough to reasonably conclude the earlier . . .
Complaint was not a related claim to the government based on
the facts.” See U.S. ex rel. Wilson v.
Bristol-Myers Squibb, Inc., 750 F.3d 111, 119 (1st Cir.
second argument is factually incorrect. The Third Amended
Complaint in the Delaware action expressly alleges that
“AstraZeneca's off-label promotion of Seroquel IR
and Seroquel XR caused physicians to prescribe both drugs for
non-medically accepted uses . . . .” U.S. ex rel.
Tracey Miksell-Branch v. AstraZeneca, et al., No.
10-cv-154 (D. Del.), Third Amended Complaint at ¶¶
final argument is that the Delaware case is no longer pending
because the parties agreed to stay the case. After such
agreement, the district court stayed and administratively
terminated the case “in a way that preserves the status
quo of [the a]ction as of the date of the stay.”
U.S. ex rel. Tracey Miksell-Branch v. AstraZeneca, et
al., No. 10-cv-154 (D. Del.), Joint Stipulation
Requesting Stay of Action at 4. However, the Delaware case
was never dismissed. And as the Supreme Court
recently instructed, “a qui tam suit
under the FCA ceases to be ‘pending' once it is
dismissed.” Kellogg Brown & Root
Servs., Inc. v. U.S., ex rel. Carter, 135 S.Ct. 1970,
1979 (2015) (emphasis added).
pending Delaware action alleges off-label promotion of
Seroquel IR and Seroquel XR, plaintiff's off-label
promotion allegations are barred by the first-to-file rule.
Therefore, pursuant to Rule 12(b)(1), the Court dismisses
One in the Ninth Amended Complaint alleges a violation of the
False Claims Act. An entity is liable under the False Claims
Act when it “‘knowingly presents, or causes to be
presented, a false or fraudulent claim for payment or
approval' to the U.S. government; or . . .
‘knowingly makes, uses, or causes to be made or used, a
false record or statement material to a false or fraudulent