Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_14-md-02521/USCOURTS-cand-3_14-md-02521-14/pdf.json

Nature of Suit Code: 410
Nature of Suit: Antitrust
Cause of Action: 28:1331 Fed. Question

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

UNITED FOOD AND COMMERCIAL 

WORKERS LOCAL 1776 & 

PARTICIPATING EMPLOYERS HEALTH 

AND WELFARE FUND, et al.,

Plaintiffs,

v.

TEIKOKU PHARMA USA, INC., et al.,

Defendants.

Case No. 14-md-02521-WHO 

ORDER RE DISCOVERY LETTER

Re: Dkt. No. 227

The parties filed a discovery letter regarding a dispute as to production of documents on 

July 10, 2015. Defendants request production of “documents concerning the extent to which 

Plaintiffs bear the burden of prescription drug costs and whether Plaintiffs have ‘passed on’ those 

costs to their members, members’ employers, members’ unions, or any other person or entity.” 

Dkt. No. 227. This includes, among other things, documents concerning the EPP’s obligation to 

pass on actual or anticipated lower costs to any source from which the EPPs obtain revenue, or 

documents relating to plans and premiums that the EPPs agreed to reimburse or pay for the 

purchase of Lidoderm. See Dkt. No. 227, Ex. A. Defendants argue that “[t]he requested 

information is relevant to: (i) whether plaintiffs were injured by the settlement agreement; (ii) 

defendants’ defense that plaintiffs passed on any alleged overcharge; (iii) the quantum of damages 

plaintiffs allegedly sustained; and (iv) whether EPPs’ proposed class satisfies the requirements of 

Fed. R. Civ. P. 23.” Dkt. No. 227. 

Plaintiffs offer to provide “premium related documents that refer to Lidoderm 

specifically.” Id. At this juncture, the offered documents, plus the other information that is not 

objected to in the RFPs, are sufficient to provide defendants with the necessary information about 

whether the EPPs were injured, and whether they passed on any alleged overcharge. 

Case 3:14-md-02521-WHO Document 232 Filed 07/17/15 Page 1 of 3
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United States District Court

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In addition, at this point it is unclear how the information defendants request about “passon” charges will affect class certification requirements such as ascertainability. Defendants cite 

two main cases in support of their discovery request: In re Skelaxin (Metaxalone) Antitrust Litig., 

299 F.R.D. 555, 570 (E.D. Tenn. 2014) and Vista Healthplan, Inc. v. Cephalon, Inc., No. 2:06-

CV-1833, 2015 WL 3623005, at *8 (E.D. Pa. June 10, 2015).

1

 Neither case involved the scope of 

discovery.

In each case, the court denied a motion for class certification because it found that it was 

not possible to ascertain all class members. Each court noted the difficulties in determining “passon” costs in each transaction: “In order to determine who is a member of the class, individual 

inquiry into contracts covering millions of purchases of Skelaxin would be required.” In re 

Skelaxin (Metaxalone) Antitrust Litig., 299 F.R.D. 555, 570. 

Skelaxin found that “the issue with End Payors’ class is not whether a purchaser was 

damaged in each individual transaction; the issue is whether a purchaser constitutes a class 

member.” Id. at 570. The court found that the class was not ascertainable because “End Payors’

expert testified that, depending on the circumstances of each transaction, an end payor may be one 

or more entities or individuals sharing the burden.” Cephalon included a similar analysis.2 Vista 

Healthplan, Inc. v. Cephalon, Inc., No. 2:06-CV-1833, 2015 WL 3623005, at *11 (E.D. Pa. June 

10, 2015).

Here, the ascertainability of the class will require an inquiry into whether the EPPs share 

the cost burden with others and whether their proposed class would be ascertainable. At this 

point, discovery regarding all of the numerous contracts between the EPPs and their members is 

not necessary to resolve these questions. In addition, the cases that defendants cite, such as 

Skelaxin and Cephalon, point to “Pharmacy Benefits Managers” as passing on costs, but 

defendants acknowledge that plaintiffs excluded these parties from the proposed class. Dkt. No. 

 

1 Although defendants provide other support in footnotes in the Joint Statement, none of these 

cases alters my decision. 

2

In addition, the Cephalon described the problems in the plaintiffs’ evidence that prevented them 

from establish ascertainability. Vista Healthplan, Inc. v. Cephalon, Inc., No. 2:06-CV-1833, 2015 

WL 3623005, at *10 (E.D. Pa. June 10, 2015).

Case 3:14-md-02521-WHO Document 232 Filed 07/17/15 Page 2 of 3
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United States District Court

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227 at 2 n.4. 

It may be true that some of the documents that defendants seek are relevant, especially 

concerning damages. However, their request is burdensome, and at this early stage, it is not clear

how it will provide substantially more material information concerning damages or class 

certification than the information that the EPPs have offered to produce. The documents plaintiffs 

will produce may provide the defendants with ammunition that they can use to justify imposing a

larger production burden on the EPPs. If so, defendants may make another request for production. 

But at this point and given the burden on the EPPs, the EPPs need not produce the broad range of 

documents requested by defendants. Instead, the parties should proceed with production of 

“premium related documents that refer to Lidoderm specifically” and the other uncontested 

documents. 

IT IS SO ORDERED.

Dated: July 17, 2015

______________________________________

WILLIAM H. ORRICK

United States District Judge

Case 3:14-md-02521-WHO Document 232 Filed 07/17/15 Page 3 of 3