Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_06-cv-01479/USCOURTS-casd-3_06-cv-01479-3/pdf.json

Nature of Suit Code: 450
Nature of Suit: Interstate Commerce
Cause of Action: 28:1441 Petition for Removal

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06cv1479

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

RA MEDICAL SYSTEMS, INC.,

Plaintiff,

v.

PHOTOMEDEX INC,

Defendant.

_________________________________

AND RELATED COUNTERCLAIMS

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Civil No. 06-CV-1479-L(CAB)

ORDER GRANTING

DEFENDANT’S MOTION TO

DISMISS COUNT TWO OF THE

COMPLAINT [doc. # 4]

The above-captioned case was removed from the Superior Court of the State of California

for the County of San Diego on July 24, 2006. The Complaint was filed on June 8, 2006 and

contains two causes of action against defendant: Count One alleges violation of California

Health and Safety Code which constitutes unfair competition in violation of the California

Business and Professions Code; and Count Two alleges unfair competition in violation of

California Business and Professions Code under the Medical Practice Act 

Currently pending is defendant’s motion to dismiss count Two of the Complaint. The

Court notes that plaintiff attempted to file an amended complaint on August 9, 2006, but the

amended complaint was rejected by discrepancy order. On September 5, 2006, the Court

vacated the discrepancy order based upon a stipulation of the parties. See Order filed September

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5, 2006 [doc. #9]. The Court ordered that “[p]laintiff shall resubmit the rejected Amended

Complaint forthwith for filing, and shall attach a copy of this order thereto.” Id. (Emphasis

added). To date plaintiff has not submitted its amended complaint for filing even though

plaintiff was ordered to file its amended complaint within five days of the filing of the

September 5, 2006 Order. Accordingly, the operative Complaint in this action is plaintiff’s

original Complaint.

The motion to dismiss the second count of the Complaint that was filed on July 24, 2006,

was set for hearing on October 10, 2006 [doc. #15]. On October 4, 2006, the case was

transferred under the low number rule to the undersigned. Although the hearing date was

vacated before the original presiding judge because of the transfer, the date remained in place for

briefing purposes under the Civil Local Rules. Accordingly, plaintiff’s opposition to the motion

to dismiss Count Two was due on or before September 25, 2006. To date, plaintiff has neither

filed an opposition nor sought additional time in which to file an opposition.

When an opposing party does not file papers in the manner required by Civil Local Rule

7.1(e.2), the Court may deem the failure to “constitute a consent to the granting of a motion or

other request for ruling by the court.” CIV. L.R. 7.1(f.3.c). Notwithstanding plaintiff’s failure to

file an opposition, the Court will review the motion on the merits to determine whether any legal

issue exists that would preclude granting defendant’s motion to dismiss count Two. 

Motion to Dismiss Standard

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests the sufficiency

of the complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). Dismissal of a claim

under this Rule is appropriate only where “it appears beyond doubt that the plaintiff can prove

no set of facts in support of his claim which would entitle him to relief.” Conley v. Gibson, 355

U.S. 41, 45-46 (1957); Navarro, 250 F.3d at 732. Dismissal is warranted under Rule 12(b)(6)

when the complaint lacks a cognizable legal theory. Robertson v. Dean Witter Reynolds, Inc.,

749 F.2d 530, 534 (9th Cir. 1984); see Neitzke v. Williams, 490 U.S. 319, 326 (1989) (“Rule

12(b)(6) authorizes a court to dismiss a claim on the basis of a dispositive issue of law.”). 

Alternatively, a complaint may be dismissed where it presents a cognizable legal theory yet fails

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to plead essential facts under that theory. Robertson, 749 F.2d at 534. 

In reviewing a motion to dismiss under Rule 12(b)(6), the court must assume the truth of

all factual allegations and must construe them in the light most favorable to the nonmoving

party. Thompson v. Davis, 295 F.3d 890, 895 (9th Cir. 2002); Cahill v. Liberty Mut. Ins. Co., 80

F.3d 336, 337-38 (9th Cir. 1996). However, legal conclusions need not be taken as true merely

because they are cast in the form of factual allegations. Roberts v. Corrothers, 812 F.2d 1173,

1177 (9th Cir. 1987); Western Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981). When

ruling on a motion to dismiss, the court may consider the facts alleged in the complaint,

documents attached to the complaint, documents incorporated by reference in the complaint, and

matters of which the Court takes judicial notice. United States v. Ritchie, 342 F.3d 903, 908 (9th

Cir. 2003); Parrino v. FHP, Inc., 146 F.3d 699, 705-06 (9th Cir. 1998).

Discussion

In Count Two plaintiff alleges that defendant engaged in unfair competition by violating

the California Medical Practice Act (“MPA”). Plaintiff contends taht provisions of a written

agreement that defendant executed with a physician in Maryland violate the MPA and constitute

unfair competition under California Business & Professions Code § 17200. Plaintiff asserts that

defendant and a Maryland physician entered into a written Commercial Usage Agreement

(“CUA”) which violate the MPA because, inter alia, the CUA interferes with or influences the

physician’s professional judgment and prevents and discourages health care providers from

using any other excimer light source treatment even if that physician determines that another

excimer light source would be the preferred and appropriate method of treatment for a particular

pation. 

Defendant contends that the conduct alleged in Count Two is not a violation of the

Business & Professions Code § 2052 because the Complaint contains no allegations that

defendant is practicing medicine in California or that it practices medicine without a license.

Similarly, defendant argues that the conduct alleged in Court Two is not a violation of

Business & Professions Code § 2056 which provides in relevant part: “[n]o person shall

terminate, retaliate against, or otherwise penalize a physician and surgeon for that advocacy, nor

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shall any person prohibit, restrict, or in any way discourage a physician and surgeon from

communicating to a patient information in furtherance of medically appropriate health care.” 

Bus. & Prof. Code § 2056(c). Defendant argues that the Complaint does not allege any conduct

that falls within the scope of Business and Professions Code § 2056 because there is no

allegation that defendant is involved in making any specific decision concerning the diagnosis or

treatment of any particular patient. Nor does the Complaint allege that any physician protested

or appealed any decision, policy or practice of defendant’s that the physician reasonably

believed impaired his or her ability to provide medically appropriate health care. Instead, the

Complaint alleges that a Maryland physician agreed to restrict his use of excimer lasers in

treating his patients to the XTRAC system and that defendant could terminate the CUA if the

amount of his use of the the XTRAC system was insufficient. 

Because there is no allegation contained in the Complaint that the Maryland doctor or

defendant did anything other than negotiate and agree to the terms of the CUA, the Court must

concluded that plaintiff fails to state a claim under Business & Professions Code § 2056. 

Moreover, because the physician at issue is a citizen of Maryland and defendant is a citizen of

the states of Delaware and Pennsylvania, and the CUA expressly states that it is governed by

Maryland law, California does not govern the conduct alleged in Court Two of the Complaint

and cannot form the basis of an unfair competition claim against Defendant. 

Conclusion

Based on the foregoing, IT IS ORDERED granting defendant’s motion to dismiss Count

Two from the Complaint.

IT IS SO ORDERED. 

DATED: February 1, 2007

M. James Lorenz

United States District Court Judge

COPY TO: 

HON. CATHY ANN BENCIVENGO

UNITED STATES MAGISTRATE JUDGE

ALL PARTIES/COUNSEL

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