# U ni te d S ta te s Co ur t of A pp ea ls
For the Eig hth Circu it

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No. 1 8- 16 28

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Park Irm at Drug Co rp

.

ll ll ll ll ll ll ll ll ll ll l Pla in ti

ff - App el la nt

v.

Exp res s Sc rip ts Hol di ng Co m pa ny; Exp res s Sc rip ts , Inc

.

ll ll ll ll ll ll ll ll ll ll l Defe nd

an ts - App el le es

__ __ __ __ __ __ App eal fro m

Uni te d S ta te s Di st ric t Co ur t fo r th e Eas te rn Dis tri ct of M is so ur i - St . Lou is

__ __ __ __ __ __

Su bm it te d: Sep te m

be r 26 , 20 18 Fi le d: Decem

be r 12 , 20 18

__ __ __ __ __ __

Befo re WOL LMAN, KELL Y, and ERICKSON, Ci rcu it Ju dg es

.

__ __ __ __ __ __

W OLLMAN, Circ ui t J ud ge

.

Park Irm at D r u g C o rp or at io n (Irm at ) br ou gh t su it ag ai ns t Exp res s Scri pt s Hol di ng Co m

pa ny an d Exp res s Scri pt s, In c. (Exp res s Scri pt s)

, al le gi ng va rio us

co nt ract cl ai m s, a pr om is so ry es to pp el cl ai m , an d vi ol at io ns of fed eral an ti tru st la wsan d st at e Any W il li ng Pro vi de r la ws. The di st ric t co ur t di sm is se d Irm at ’s co m pl ai nt 1

fo r fai lu re t o s ta te a cl ai m . W e aff irm.

I.

Exp res s Scri pt s is th e la rg es t ph arm acy be ne fit s m an ag er (PBM ) in th e Uni te d

St at es

. A PBM is a th ird -p art y ad m in is tra to r of pr es cri pt io n dr ug pr og ram s. PBM s

pr oc es s an d pa y pr es cri pt io n dr ug cl ai m s m ad e by p ha rm aci e s a n d pa ti en ts

. PBM s al so ne go ti at e dr

ug di sc ou nt s with ph arm aceu ti cal m an uf act ur ers , ha nd le ph arm acy be ne fit s fo r he al th pl an s an d se lf- in su red en ti ti es , an d de ve lo p li st s of dr ug s th at are

ap pr ov ed fo r rei m

bu rs em en t. A pa ti en t’s he al th in su ran ce pl an ch oo se s whi ch PBM

co ve rs th ei r dr ug -rel at ed ex pe ns es

. Exp res s Scri pt s and an ot he r PBM , CVS Heal th (CVS), a cco un t fo r 65 % of t he PBM m ark et

.

PBM s crea te ne two rk s of ph arm aci es in whi ch PBM m em be rs can rece iv e th ei r

pr es cri pt io n ph arm aceu ti c a l s a t co ve red

, di sc ou nt ed rat es

. To be su cces sf ul

, in de pe nd en t ph arm aci es m us t pa rti ci pa te in th e la rg es t PBM ne two rk s. The se in de pe nd en t ph arm aci es co nt ract wit h PBM s ei th er di rect ly or th ro ug h an ag en t su ch

as a Ph arm acy Serv ic es Adm in is tra ti ve Org an iz at io n (PSAO). Nin et y -s ev en pe rcen t

o f ret ai l ph arm aci es in th e Uni te d St at es pa rti ci pa te in Exp res s Scri pt s’s ph a r mac y

ne two rk

.

Exp res s Scri pt s al so op erat es a m ai l-o rd er ph arm acy th at fil ls pr es cri pt io ns by

m ai l na ti on wid e. It is th e on ly m ai l-o rd er ph arm acy al lo we d i n Exp res s Scri pt s’s

PBM ne two rk

. Acco rd in g to Irm at
, PBM s th at own m ai l-o rd er ph arm aci es do m in at e th e m ai l-o rd er ph arm acy se rv ic e in du st ry

. Nev ert he le ss , in de pe nd e nt ph arm aci es ,

The Hon or ab le Ro nn ie L. W hi te
, Uni te d St at es Dis tri ct Ju dg e fo r th e East ern 1
Dis tri ct of M is so ur i.

-2

-li ke Irm at
, ha ve be en ab le to su cces sf ul ly pr ov id e m ai l-o rd er ph arm acy se rv ic es to

cu st om ers in th e Uni te d S ta te s.

Irm at is a New Yor k- ba se d, in de pe nd en t ph a r mac y lo cat ed in m id to wn
M an ha tt an

. It op en ed in 19 78

. Fo r m an y y ears , Irm at was a su cces sf ul r e t a i l ph arm acy th at fil le d an d so ld pr es cri pt io ns vi a it s st or efro nt lo cat io n. In 20 13

, Irm at
be ga n fo cu si ng on de rm at ol og ic al ph arm aceu ti cal s. It en te re d i n to a pa ti en t

as si st an ce pr og ram wit h de rm at ol og ic al dr ug m an uf act ur ers fo r ph arm aceu ti cal s th at
of te n ha d no ge ne ric eq ui va le nt

. Und er th e pr og ram s, th e m an uf act ur ers wou ld pa y

a p or ti on of a pa ti en t’s i ns ur an ce co -p ay m en t to Irm at . Becau se of i ts pa rti ci pa ti on in the se pr ogr am s, Ir

m at ex pa nd ed it s bu si ne ss in to a na ti on wid e m ai l-o rd er ph arm acy

an d i nc reas ed it s s ta ff fro m twen ty em

pl oyees t o 2 08 em

pl oyees.

Irm at joi ne d Exp res s Scri pt s’s PBM ne two rk in 20 12 th ro ug h Acces sHe al th

,

a PSAO, an d ga in ed acce ss to m or e th an 10 0 ot he r PBM s. In Octo be r 20 14

, Exp res s Scri pt s se nt Irm at a N et

w or k Pro vi de r Agr eem en t (th e ag reem en t) req ui rin g th at Irm at
si gn or ris k te rm in at io n fro m it s ne two rk

. The ag reem en t req ui red Irm at to m eet th e de fin it io n of a “ ret ai l pr ov id er,” w h i c h w a s de fin ed as a ph arm acy “ th at pr im ari ly

fil ls an d se ll s pr es cri pt io ns vi a a ret ai l, st or efro nt lo cat io n” an d th at “ sh al l no t in cl ud e

m ai l or de r” ph arm aci es

. The ag reem en t als o in cl ud ed recr ed en ti al in g req ui rem en ts
whe reb y a ret ai l pr ov id er m us t di sc lo se up da te d in fo rm at io n to Exp res s Sc rip ts

. Fai lu re to co m

pl y wit h th e recr ed en ti al in g req ui rem en ts co ns ti tu te d a br each of th e

ag reem en t an d was cau se fo r te rm in at io n fro m Exp res s S c r i p t s ’s ne two rk

. Fi na ll y , th e ag reem en t al lo wed Exp res s Scri pt s to un il at eral ly te rm in at e th e co nt ract wit ho ut

cau se up on th irt y

da y s wri tt en no ti ce. Irm at si gn ed th e ag reem en t.

Exp res s Scri pt s req ui red Irm at to su bm it a recr ed en ti al in g app li cat io n in Ju ly

20 15

. Irm at di sc lo se d th at 35 % of it s bu si ne ss cam e fro m it s ret ai l ph arm acy an d th at
65 % of it s bu si ne ss cam e fro m it s m ai l-o rd er ph arm acy. On Aug us t 7, 20 15

, Exp res s

-3

-Scri pt s se nt Irm at an e-m ai l, th e su bjec t li ne o f w h ic h read “ Exp res s Scri pt s

cred en ti al s ap pr ov ed ,” an d t he tex t o f whi ch st at ed :

W e are pl eas ed to in fo rm y ou t h a t you r rece nt ly su bm it te d cred en ti al s ha ve be en rev ie w e d a n d you are ap pr ov ed to co nt in ue in th e Exp res s Scri pt s Ho ld in g C om

pa ny ph arm acy netwo rk s.

Irm at th en hi red m or e em

pl oyees, co ns tru ct ed a m

ul ti -m il li on do ll ar faci li ty in

New Yor k, an d sp en t ti m e an d m on ey acq ui rin g m ai l-o r d e r accr ed it at io ns

. In May

20 16 , Exp res s Sc rip ts sen t Ir m at a le tt er d em an di ng Irm at ceas e an d d es is t i ts m ai lor de r op erat io ns be cau se th ey were i n vi ol at io n of th e ag reem en t. Irm at res po nd ed

wit h a le tt er refe rri ng to th e Aug us t 20 15 e-m ai l. On Ju ly 15

, 20 16

, Exp res s Scri pt s

rep li ed th at Irm at wou ld be te rm in at ed fro m th e ne two rk in si xt y -o ne da y s, pr im ari ly

be cau se of Irm at ’s m ai l-o rd er bu si ne ss

. I r mat ap pe al ed th e te rm in at io n th ro ug h Exp res s Scri pt s’s in te rn al ap pe al pr oc es s. Exp res s Scri pt s affi rm ed it s de ci si on in a le tt er da te d Aug us t 22

, 20 16

, whi ch ad de d th at it was al so te rm in at in g Irm at wit ho ut

cau se

. Exp res s Scri pt s te rm in at ed Irm at fro m it s ne two rk on or ab ou t Sep te m be r 30

, 20 16

.

II.

W e rev ie w de no vo th e gr an t of a m ot io n to di sm is s. Ch ris ti an se n v. W

. Bran ch

Cm ty. Sch

. Dis t., 67 4 F.3 d 92 7, 93 3- 34 (8 th Ci r. 20 12 ). W e acce pt “ as tr u e th e

co m pl ai nt ’s fact ua l al le ga ti on s an d gr an t[ ] al l reas on ab le in f e r e n c e s to th e

no n- m ov in g pa rty.” B r ad en v. W al -Ma rt St or es , In c., 58 8 F.3 d 58 5, 59 1 (8 th Ci r.
20 09 ).

“ To su rv iv e a 12 (b )(6 ) m ot io n to di sm is s, ‘a co m pl ai nt m us t co nt ai n su ffi ci en t
fact ua l m at te r, acce pt ed as tru e, to st at e a cl ai m to rel ie f th at is pl au si bl e on it s face .’ ”

McS ha ne Co ns tr. Co

. v. Got ha m In s. Co

., 86 7 F.3 d 92 3, 92 7 (8 th Ci r. 20 17 ) (q uo ti ng Ash cro ft v. Iq ba l, 55 6 U.S. 66 2, 67 8 (2 00 9) ). “ W e as se ss pl au s i b i l i ty co ns id eri ng

-4

-on ly th e m at eri al s th at are ‘neces sa ril y em br a c ed by th e pl ead in gs an d ex hi bi ts

at ta ch ed to th e co mp l a in t.’” W hi tn ey v. Guys, In c., 70 0 F.3 d 11 18

, 11 28 (8 th Ci r.
20 12 ) (q uo ti ng Mat te s v. ABC Pl as ti cs , In c., 32 3 F.3 d 69 5, 69 7 n.4 (8 th Ci r. 20 03 )).

“ A cl ai m ha s faci al pl au si bi li ty whe n th e pl ai nt iff pl ead s fact ua l con te nt th at al lo ws th e co ur t to dr aw t h e r e a s on ab le in fere nc e th at th e de fen da nt is li ab le fo r th e

m is co nd uc t al le ge d.” Id. (q uo ti ng Iqb al , 55 6 U.S. at 67 8)

.

A.

1.

Irm at arg ue s th at th e ag reem en t is un co ns ci on ab le be cau se it al lo wed Exp res s Scri pt s, bu t no t Irm at
, to te rm in at e th e ag reem en t wit ho ut cau se

. W e ha ve he ld th at

“ [a] bi la te ral co nt ract is no t ren de red in va li d an d un en fo rcea bl e m erel y be cau se on e

pa rty ha s th e rig ht to can cel la ti on whi le th e ot he r do es no t. The re is no ne ces si ty ‘tha t
fo r each st ip ul at io n in a co nt ract bi nd in g th e on e pa rty th ere m us t be a co rres po nd in g

st ip ul at io n bi nd in g th e ot he r.’” Lacl ed e Gas Co

. v. Am oc o Oil Co

., 52 2 F.2 d 33

, 36 (8 th Cir . 19 75 ) (q uo ti ng James B. Ber ry ’s Son s C o. v . Mo na rk Gaso li ne & Oil Co

., 32 F.2 d 74 , 7 5 (8 th Ci r. 19 29 )). Thu s, t h e i nc lu si on of Exp res s Scri pt s’s un il at eral rig ht to te rm in at e th e ag reem en t up on th irt y da y s writ te n no t ic e is

, by it se lf,

in su ffi ci en t to su pp or t a cl ai m o f u n c on sc io na bi li ty. Id

. at 37 (d et erm in in g th at a

can cel la ti on cla us e wil l i nv al id at e a co nt ract on ly if it s ex erci se is un res tri ct ed ).

I r mat fu rth er co nt en ds

, ho wev er, th at th e ag reem en t is al so un co ns ci on a b l e be cau se it was a no n- ne g o t i ab le fo rm co nt ract
, i.e.
, a co nt ract of ad he si on

. “ In

Mi ss ou ri, an ad he si on co nt ract
, as op po se d to a n e g ot ia te d co nt ract
, ha s be en de sc rib ed as a fo rm co nt ract crea te d an d im po se d by a st ro ng er pa rty up on a weak er

pa rty o n a ‘tak e th is or no th in g ba si s,’ th e te rm s of whi ch un ex pe ct ed ly or

-5

-un co ns ci on ab ly li m it t h e ob li ga ti on s of th e dr aft in g pa rty.” Fu ll er v. TLC Pro p. 2
Mg m t., LLC, 40 2 S.W .3d 10 1, 11 2 (Mo

. Ct

. App

. 20 13 ) (en ba nc ) (in te rn al qu ot at io n

m ark s an d ci ta ti on s om it te d)

. “ Und er Mi ss ou ri la w, ho wev er, th e fact th at a co nt ract
is on e of ad he si on do es no t ne ces sa ril y m ak e it in va li d.” Eato n v. CMH Hom es , In c.,
46 1 S.W .3d 42 6, 43 8 (Mo

. 20 15 ). Mi ss ou ri ha s “i d en ti fie d a nu m be r of fact or s in di cat in g un co ns ci on ab il it y [in cl ud in g] h i gh pr es su re sa le s ta ct ic s

. . . or un eq ua l

ba rg ai ni ng p o s i t i o n s .” Brewe r v. Mo

. Tit le Loa ns , 36 4 S.W .3d 48 6, 48 9 n.1 (Mo

. 20 12 ).

Irm at arg ue s th at th e co nt ract of ad he si on is un co ns ci on ab le be cau se Exp res s Scri pt s ex ert ed si gn ifi c a n t pr es su re on Irm at to en te r in to th e ag reem en t an d ha d

gr eat er ba rg ai ni ng po wer th an Irm at

. Sp eci fic al ly, Exp res s Scri pt s th reat en ed th at if

I r mat d i d no t co m

pl et e an d ret ur n th e ag reem en t, Irm at wou ld be in br each of th ei r

or ig in al ne two rk co nt ract an d su ffer pa ti en t di sr up ti on

. Irm at al so ci te s it s al le ga ti on th at m or e th an 97 % of al l U.S. ret ai l ph arm aci es pa rti ci pa t e i n Exp res s Scri pt s’s

ne two rk an d th at pa rti ci pa ti ng in Exp res s Scri pt s’s ne two rk was a m at te r of bu si ne ss

ne ces si ty for Irm at

.

Irm at ar g u e s t h a t th is cas e is an al og ou s to Brewe r, in whi ch th e Mi ss ou ri

Su pr em e Co ur t fo u n d t h e c o nt ract at is su e was un co ns ci on ab le

. In Brewe r, th e pl ai nt iff

, an av erag e co ns um er, co nt ract ed fo r a se cu red lo an be ari ng a n a nn ua l

in te res t rat e of 30 0%. Id

. at 48 7. The ag reem en t req ui red th e pl ai nt iff to su bm it an y cl ai m s ag ai ns t th e de fen da nt to in di vi du al arb it rat io n, l e a vi ng th e de fen da nt free to

ut il iz e th e co ur ts
, id

., a pr ov is io n no t pr es en t in t h i s cas e. Fu rth erm or e, Irm at is a

so ph is ti cat ed co ns um er th at ha d op erat ed s u c ces sf ul ly ou ts id e Exp res s Scri pt s’s

ne two rk pr io r to 20 12

. Fi na ll y , as th e di st ric t co ur t pr op erl y no te d, Irm at ha d acce ss

to m or e th an 10 0 PBM ne two rk s whe n it joi ne d Acces sHe al th

. See Crawf or d Pro f’l

Dru gs , In c. v. CVS Care m ark Co rp ., 74 8 F.3 d 24 9, 26 4 (5 th Ci r. 20 14 ) (n ot in g th ere

The pa rti es ag ree t ha t M is so ur i l aw ap pl ie s t o t he st at e-l aw cl ai m s. 2

-6

-w a s no co nt ract of ad he si on whe rei n “ [t]he Pl ai nt iff s ha ve fai le d to pr es en t a n y

ev id en ce th at th ey were pr ev en te d fro m co nt ract in g wit h an ot he r PBM ”). Irm at ha s th us fai le d t o p la us ib ly ple ad th at th e ag reem en t was un co ns ci on ab le

.

2.

Irm at ne xt arg ue s t ha t Ex pr es s Sc rip ts vi ol at ed it s d ut y of go od fai th an d fa ir

de al in g whe n it te rm in at ed Irm at fro m it s ne two rk

. “ Mi ss ou ri la w im pl ie s a co ve na nt
of go od fai th an d fa ir d eal in g i n e ve ry co nt ract .” Farm ers ’ Elec

. Co op ., Inc . v. Mo

. Dep ’t of Co rr. , 97 7 S.W .2d 26 6, 27 1 (Mo

. 19 98 ). Und er Mi ss ou ri la w, ge ne ral ly,

“ th ere can be no br each of th e im pl ie d pr om is e or co ve na nt of go od fai th an d fai r de al in g whe re th e co nt ract ex pr es sl y pe rm it s th e act io ns be in g ch al le ng ed

, a n d th e de fen da nt act s in acco rd an ce wit h th e ex pr es s te rm s of th e co nt ract .” Arb or s at Su ga r
Cree k Hom eo wne rs Ass ’n v . J effe rs on B an k & Tr. C o., 46 4 S.W .3d 17 7, 18 5 (Mo

. 20 15 ) (in te rn al qu ot at io n m ark s an d ci ta ti on s om it te d)

. A pa rty ex erci si ng it s ex pr es s

co nt ract rig ht s, ho wev er, m ay st il l br each th e co ve na nt if it do es so “ in a m an ne r th at

ev ad es th e sp iri t of th e ag reem en t an d de ni es th e m ov an t th e ex pe ct ed be ne fit of th e

ag ree men t

. ” Glen n v. Heal th Lin k HMO, In c., 36 0 S.W .3d 86 6, 87 7 (Mo . C t. App

. 20 12 ).

Irm at do es no t d en y th at it vi ol at ed th e co nt ract an d t ha t Exp res s Scri pt s was th us en ti tl ed to te rm in at e Irm at fro m it s ne two rk fo r cau se

. Irm at arg ue s in st ead th at Exp res s Scri pt s act ed in ba d fai th by te rm in at in g Irm at on th e ba si s of it s

an ti co m pe ti ti ve m ot iv es when ex erci si ng it s ri gh t t o t erm in at e Irm at wit ho ut cau se

. Irm at ci te s BJ C Heal th Sy st em v. Co lu m bi a Cas ua lt y C o

. , 47 8 F.3 d 90 8 (8 th Ci r.
20 07 ), whi ch we co nc lu de is in ap po si te

. W e he ld in th at cas e th at un de r Mi ss ou ri la w

a jury co ul d fin d th at a pa rty to a co nt ract act ed in ba d fai th whe n m ak in g a su bjec ti ve de ci si on reg ar d i n g t h e co nt ract th at m ay ha ve be en un reas on ab le an d in te nt io na ll y de si gn ed to tri gg er a te rm in at io n pr ov is io n. Id

. at 91 6; se e al so Mar ti n v. Pri er Bras s Mfg

. Co

., 71 0 S.W .2d 46 6, 47 2- 73 (Mo

. Ct

. App

. 19 86 ) (d et erm in in g th at de fen da nt

-7

-act ed in ba d fai th whe n it su bjec ti ve ly read co nt ract te rm s to al lo w fo r te rm in at io n of

be ne fit s at wil l an d wit ho ut no ti ce). Here, ho wev er, Exp res s Scri pt s di d no t m ak e a di sc ret io na ry de ci si on in ei th er defi ni ng th e te rm s of th e ag reem en t or in exe rci si ng it s rig ht s un de r th e ag reem en t. The Mi ss ou ri Su pr em e Co ur t ha s ex pl ic it ly he ld th at

a de fen da nt do es no t act in ba d fai th whe n it act s in acco rd an ce wit h e xp res s

co nt ract ua l rig ht s th at al lo w it to te rm in at e th e ag reem en t wit ho ut cau se up on th irt y da y s no ti ce. Bi sh op & A s s o c s

. v. Am eren Co rp ., 52 0 S.W .3d 46 3, 47 1- 72 (Mo

. 20 17 ); se e al so Am eck s, In c. v. Sw. Bel l Tel. Co

., 93 7 S.W .2d 24 0, 24 2- 43 (Mo

. Ct

. App . 19 96 ) (co nc lu di ng th at de fen da nt di d no t act in ba d fait h when it ex erci se d i ts

co nt ract ua l rig ht to te rm in at e th e co nt ract at an y ti m e wit h at le as t th irt y da y s no ti ce);

Mar ti n v. Am

. Fam il y Mu t. In s. Co

., 15 7 F.3 d 58 0, 58 2 (8 th Ci r. 19 98 ) (p er cu ria m ) (“ Bec au se th e ag en cy co nt ract un am bi gu ou sl y pe rm it te d te rm in at io n of th e ag en ci es

at wil l

. . . th e co ve na nt of go od fai th an d fa i r d e a l in g can no t gi ve ris e to a rig ht

ag ai ns t te rm in at io n.” ) (in te rn al ci ta ti on s om it te d)

. Irm at do es no t di spute tha t E xpr es s Scri pt s ga ve th e pr op er no ti ce req ui red by th e ag reem en t, an d th us it can no t cl ai m ba d

fai th

.

3.

Irm at ne xt arg ue s th at Exp res s Sc r i p ts ’s Aug us t 20 15 e-m ai l co ns ti tu te d a

no va ti on of th e ag reem en t. It co nt en ds th at th e e-m ai l ex ci se d th e pr oh ib it io n ag ai ns t

op erat in g a m ai l-o rd er ph arm acy fro m th e ag reem en t an d ab ro ga te d Exp res s Scri pt s’s

co nt ract ua l rig ht s to te rm in at e Irm at fo r an d wit ho ut cau se

. Irm at arg ue s th at Exp res s Scri pt s t hu s b reac he d t hi s n ew co nt ract when it ter m in at ed Irm at fro m th e ne two rk

. Exp res s Scri pt s res po nd s th at be cau se th e e-m ai l was no t a no va ti on bu t m erel y a

co nt ract ua ll y ob li ga te d st ep in th e recr ed en ti al in g pr oc es s, th ere was no ne w co nt ract

an d th us no br each

. See D.R. Sh erry Co ns tr., Ltd

. v. Am

. Fam il y Mu t. In s. Co

., 31 6

S.W .3d 89 9, 90 4 (Mo

. 20 10 ) (co nc lu di ng th at a br each of co nt ract cl ai m req ui res “ a

co nt ract be twee n . . . th e p art ie s” ).

-8

-Und er Mi ss ou r i l a w , “ [a] no va ti on is a su bs ti tu ti on of a ne w co nt ract

ob li ga ti on fo r an ol d on e.” Heal th Rel at ed Serv s., In c. v. Gol de n Pl ai ns Co nv al es cen t
Ct r., In c., 70 5 S.W .2d 49 9, 51 0 (Mo

. Ct

. App

. 19 85 ). The fo ur el em en ts ne ed ed fo r

a n ov at io n i nc lu de : “ (1 ) a pr ev io us va li d ob li ga ti on ; (2 ) ag reem en t of al l p art ie s t o

a ne w co nt ract ; (3 ) ex ti ng ui sh m en t of an ol d co nt ract ; an d (4 ) va li di ty of a n e w

co nt ract .” Sta te ex rel . P rem ie r Mk tg ., In c. v. Kram er, 2 S.W .3d 11 8, 12 2 (Mo . Ct. App

. 19 99 ). “ In ad di ti on to th es e req u i r e men t s , th ere m us t be ev id en ce th at th e

pa rti es in te nd ed to en te r in to a no va ti on .” Id

. The ne w co nt ract m us t in cl ud e “ [t]he

es se nt ia l el em en ts of an en fo rcea bl e co nt ract [s uc h as ] pa rti es co m pe te nt to co nt ract
, [th e ex is te nc e of

] pr op er su bjec t m at te r, le ga l co ns id erat io n, m ut ua li ty of ag reem en t,

an d m ut ua li ty of ob li ga ti on .” L.B. v. St at e Co m m

. of Ps y ch ol og is ts
, 91 2 S.W .2d 61 1,

61 7 (M o. Ct . App . 19 95 ).

Irm at arg ue s th at th e e-m ai l’s la ng ua ge co ns ti tu te s ev i d e n c e of Exp res s Scri pt s’s in te nt to ab ro ga te th e ag reem en t an d fo rm a ne w co nt ract

. W e co nc lu de th at
th e e-m ai l was in st ead pa rt of th e recr ed en ti al in g pr oc es s req ui red by th e ag reem en t.
At m os t, th e e-m ai l an d th e la te r ceas e-an d- de si st req ue st su gg es t th at Exp res s Scri pt s de la y ed it s re cred en ti al in g p ro ces s. But an y de la y di d no t prec lu de Exp res s Scri pt s fro m de nyin g cred en ti al s to Irm at un de r th e ag reem en t’s no -wai ve r pr ov is io n, whi ch

pr ov id es :

No wai ve r of

a br each of a ny cov en an t o r co nd it io n s ha ll be co ns tru ed

to be a waiv er of an y su bs eq ue nt br each

. No act
, de la y , or om is si on do ne , su ffer ed

, or pe rm it te d by th e pa rti es sh al l be de em ed to ex ha us t or im pa ir a ny rig ht , rem ed y , or p owe r of th e p art ie s h ereu nd er.

Mo reo ve r, th e e-m ai l la ck s th e es se nt ia l el em en ts of a co nt ract an d th us can no t
be co ns tru ed as a l a w f

u l n o va ti on

. See Prem ie r Mk tg
., 2 S.W .3d at 12 2- 23 (“ A

no va ti on

. . . m

us t be su ffi ci en tl y de fin it e to al lo w th e co ur t t o d e t e r mi ne it s ex act

m ean in g an d to de fin it el y m eas ur e th e ex te nt of th e pr om is or ’s l i a b i l i t y .”). The em ai l co nt ai ns no mat eri al te rm s, no ex pi rat io n da te
, no m en ti on of th e se rv ic es

-9

-Exp res s Scri pt s wou ld be pr ov id in g, an d no ex pl an at io n of th e rig ht s an d ob li ga ti on s

of each pa rty. Lack in g t h e se es se nt ia l co nt ract ua l pr ov is io ns , th ere th us was no

no va ti on of t he ag reem en t.

B.

Alt ern at iv el y , Irm at al le ge s th at Exp res s Scri pt s’s e-m ai l pro m is ed th at Irm at

co ul d co nt in ue in th e ne two rk as a m ai l-o rd er p h a r mac y. I r m at th en rel ie d on th at

pr om is e by bu il di ng a m

ul ti -m il li on do ll ar co m

pl ex , hi rin g ad di ti on al em pl oyees, an d

sp en di ng res ou rces to ob ta in accr ed it a ti on s. Und er Mi ss ou ri la w, pr om is so ry

es to pp el req ui res : “ (1 ) a pr om is e, (2 ) on whi ch th e pa rty se ek in g to reco ve r rel ie d to
hi s or he r de tri m en t, (3 ) in a way th e pe rs on m ak in g th e pr om is e ex pe ct ed or sh ou ld

ha ve ex pe ct ed

, an d (4 ) th e rel ia nc e res ul ts in an in jus ti ce whi ch can be cu red on ly by

en fo rcem en t of th e pr om is e.” Ham ra v. Mag na Grp

., In c., 95 6 S.W .2d 93 4, 93 9 (Mo

. Ct . Ap p. 19 97 ). “ In Mi ss ou ri, pr om is so ry es to pp el is no t a fav or it e of th e la w, a nd

each el em en t m

us t cl earl y ap pe ar an d be p ro ve n by th e pa rty se ek in g it s

en fo rcem en t.” Glen n, 36 0 S.W .3d at 87 7 (in te rn al qu ot at io n m ark s an d ci ta ti on s

om it te d)

.

Irm at fai ls to pl au si bl y pl ead pr om is so ry es to pp el

. Fi rs t, Exp res s Scri pt s’s em ai l do es no t ex pl ic it ly st at e t h a t I r mat co ul d op erat e a m ai l-o rd er ph arm acy an d

rem ai n in Exp res s Scri pt s’s ne two rk

, th ereb y ex ti ng ui sh in g th e ag reem en t’s

res tri ct io n on m ai l-o rd er ph arm aci es

. See Pren ge r v. Bau m ho er, 93 9 S.W .2d 23

, 26 (Mo

. Ct

. App

. 19 97 ) (ex pl ai ni ng th at “ [t]he pr om is e gi vi ng ris e to th e cau se of act io n

m us t be de fin it e”). Eve n if the e-m ai l were co ns id ered to be a pr om is e, Irm at co ul d

no t ha ve reas on ab ly rel ie d on it be c a u se th e ag reem en t un am bi gu ou sl y al lo ws

te rm in at io n wit ho ut cau se

. W e ha ve he ld th at whe n a co n t r a c t u n a m bi gu ou sl y

pe rm it s te rm in at io n at wil l, “ pr om is so ry es to p p e l c a n n ot be us ed to crea te a rig ht

pr ev en ti ng te rm in at io n.” Mar ti n, 15 7 F.3 d at 58 2 (ci ti ng Ham ra, 95 6 S.W .2d at 93 9) ;

se e al so Cl earl y Can ad ia n Bev e rag e Co rp

. v. Am

. W in ery, In c., 25 7 F.3 d 88 0, 89 0

-1 0-(8 th Ci r. 20 01 ) (“ [P]rom is so ry es to pp el can no t be us ed to crea te rig ht s no t in cl ud ed

in th e co nt ract .” (ci ti ng Hall s Ferr y In vs ., In c. v. Sm it h, 9 85 S.W .2d 84 8, 85 3 (Mo

. Ct . Ap p. 19 98 )). The e-m ai l, t he n, co ul d no t pr ev en t Exp res s Scri pt s’s te rm in at io n of Irm at

. The di st ric t co ur t th us di d no t err in di sm is si ng Irm at ’s pr om is so ry es to pp el

cl ai m

. C.

1.

Irm at arg ue s th at Exp res s Scri pt s vi o l a t e d S e c t io n 1 of th e Sh erm an Act by

co ns pi rin g wit h o t h e r PBM -o wne d, m ai l-o rd er ph arm aci es to bo y co tt in de pe nd en t

m ai l-o rd er ph arm aci es

. “ Liab il it y un de r § 1 o f t h e S he rm an Act, 15 U.S.C. § 1,

req ui res a ‘con tra ct
, co m bi na ti on

. . . , o r c on sp ira cy , in res tra in t of tra de or

co m m erce .’ ” Bel l Atl

. Co rp

. v. Twom bl y , 55 0 U.S. 54 4, 54 8 (2 00 7)

. “ ‘[T] he cru ci al

qu es ti on ’ is whe th er th e ch al le ng ed an ti co m pe ti ti ve co nd uc t ‘stem [s ] fro m
in de pe nd en t d e c i s i o n or fro m an ag reem en t, ta ci t or ex pr es s.’” Id

. at 55 3 (s eco nd

al te rat io n in or ig in al ) (q uo ti ng The at re Ent ers ., In c. v. Para m ou nt Fi lm Dis tri b. Co rp ., 34 6 U.S. 53 7, 54 0 (1 95 4) ). To su rv iv e a Ru le 12 (b )(6 ) m o t i o n t o d i s m is s, “ an al le ga ti on of pa ral le l co nd uc t an d a ba re as se rti on of co ns pi racy wil l no t su ffi ce.” Id

. at 55 6. “ Howev er, [a]n al le ga ti on of pa ral le l co nd uc t

. . . ge ts th e co m pl ai nt cl os e to

st at in g a cl ai m ,” an d “ [w]ith ‘furt he r fact ua l en ha nc em en t,’ p la in ti ffs can ‘nud ge [ ]

th ei r cl ai m s acro ss th e li ne fro m co nc ei va bl e to pl au si bl e.’” In re Pre- Fi ll ed Pro pa ne
Tan k Ant it r u s t Li ti g., 86 0 F.3 d 10 59

, 10 69 (8 th Ci r. 20 17 ) (al te rat io ns in or ig in al ) (q uo ti ng Twom

bl y , 55 0 U.S. at 55 7, 5 70 ).

Irm at fai ls to pl au si bl y pl ead pa ral le l co nd uc t. It cl ai m s th at CVS an d Exp res s Scri pt s co ns pi red to te rm in at e Irm at fro m th ei r PBM ne two rk s be cau se it op erat ed a

m ai l-o rd er p h a r m acy th at co m pe te d wit h Exp res s Scri pt s’s an d CVS’s m ai l-o rd er ph arm aci es

. Irm at ha d be en a m em be r of CVS’s ph arm acy ne two rk s si nc e 20 12

. In Aug us t 20 16

, CVS req ui red Irm at to pa rti c i p at e in it s m ai l-o rd er ne two rk

, th ree

-1 1-m on th s aft er Exp res s Scri pt s se nt Irm at a le tt er de m an di ng th at Irm at ab an do n it s

m ai l-o rd er ph arm ac y o p erat io ns

. Alt ho ug h CVS la te r te rm in at ed Irm at fro m it s ph arm acy ne two rk s on Feb ru ary 3, 2 01 7, t he fact th at CVS al lo wed Irm at to joi n in

it s m ai l-o rd er ne two rk at al l su gg es ts th at CVS an d Exp res s Scri pt s di d no t co ns pi re

to bo y co tt Irm at

. I r mat co nt en ds

, ho wev er, th at th e Aug us t 20 16 req ui rem en t to

pa rti ci pa te in CVS’s m ai l-o rd er p h arm acy ne two rk was a ve il ed pl an to rei m bu rs e
Irm at at lo wer rat es th an it ha d pa id in th e pa st

. Irm at al so cl ai m s th at CVS su bjec te d

Irm at to ab us iv e au di ts th ro ug ho ut th e y ears

. Eve n as su m i n g t h e tru th of th os e al le ga ti on s, th ere is no ev id en ce th at Exp res s Scri pt s joi ne d in CVS’s c o n d u c t. Exp res s Scri pt s ne ve r req ui red Irm at to en te r in to a m ai l-o rd e r n e t w o r k so th at it

co ul d rei m

bu rs e pr es cri p t i on s at lo wer rat es , no r do es Irm at co nt en d th at Exp res s Scri pt s ev er s ub

jecte d Ir m at to ab us iv e au di ts

.

The on ly al le ga ti on th at hi nt s at pa ral le l co nd uc t is th at bo th CVS an d Exp res s Scri pt s te rm in at ed Irm at fro m th ei r ne two rk s. Bu t th e te rmi n a t i o n s la ck te m po ral

pr ox im it y

. Exp res s S c r i p t s n o ti fie d Irm at of te rm in at io n in Ju ly 20 16

, si x m on th s be fo re CVS no ti fie d Irm at of te rm in at io n. In de te rm in in g whe th er si x m on th s was to o lo ng of a ti m e fram e to su gg es t pa ral le l a c t i v i t y, th e di st ric t co ur t lo ok ed to In re Grap hi cs Pro ces si ng Uni ts Ant it ru st Lit ig at io n, 52 7 F. Su pp

. 2d 10 11

, 1 0 2 2 ( N.D.
Cal

. 20 07 ), in whi ch th e co ur t fo un d th at th ree m on th s be twee n act io ns fel l “ sh or t of

un us ua l, lo ck st ep

. . . be ha vi or .” W e do no t ho ld th at act io ns ta ke n wit hi n si x m on th s of e a c h o t h er can ne ve r co ns ti tu te pa ral le l co nd uc t, bu t on ly th at th e te rm in at io ns he re, execu te d un de r di ss im il ar circu m st an ces an d sep arat ed by six m on th s, d id no t

co ns ti tu te pa ral le l co nd uc t. See Bu rtc h v. Mi lb erg Fact or s, In c., 66 2 F.3 d 21 2, 22 8-

29 (3 d Ci r. 20 11 ) (d is m is si ng gr ou p bo y co tt cl ai m pa rtl y be cau se th e co nd uc t of th e de fen da nt s was no t si m il ar). Bec au se Irm at fai ls to pl au si bl y pl ead pa ral le l co nd uc t,

no di sc us si on of an y “ pl us fact or s” is ne ces sa ry

. The di st ric t co ur t co rrec tl y di sm is se d Ir m at ’s Sect io n 1 cla im

.

-1 2-2.

I r mat al le ge s th at Exp res s Scri pt s vi ol at ed Sect io n 2 of th e Sh erm an A c t
be cau se it lev erag ed it s po wer as a PBM to ex cl ud e m ai l-o rd er p ha rm aci es fro m it s
P B M n e t wor k. Thi s le d to Exp res s Scri pt s’s ha vi ng a m on op ol y po wer in t h e

su bm ark et fo r m ai l-o rd er se rv ic es to Exp res s Scri pt s m em be r s

. S e c ti on 2 m ak es it

un la wfu l to “ m on op ol iz e, or at te m pt to mo no po li ze

. . . an y pa rt of th e tra de or

co m m erce am on g th e se ve ral St at es .” 1 5 U

. S

. C

. § 2. To st at e a m on op ol y cl ai m , Irm at m us t pl ead a pl au si bl e rel ev an t mar k e t a n d th at Exp res s Scri pt s en ga ge d in

an ti co m pe ti ti ve co nd uc t. Veri zo n Co m m c’ns In c. v. Law Offi ces of Cu rti s V. Trin ko

, LLP, 54 0 U.S. 3 98 , 40 7 (2 00 4)

.

Irm at fir st fai ls to pl ead a rel ev an t m ark et

. “ It is th e pl ai nt iff ’s bu rd en to de fin e th e rel ev an t m ark et .” Dou bl e D Sp ot ti ng Serv

., In c. v. Su pe rv al u, In c., 13 6 F.3 d 55 4,

56 0 (8 th Ci r. 19 98 ). “ The de fin it io n of th e rel ev an t m ark et ha s two co m po ne nt s— a

pr od uc t m ark et an d a ge og rap hi c m ark et .” Bat hk e v. Case y ’s Gen. St or es , Inc ., 64 3

F.3 d 34 0, 34 5 (8 th Ci r. 19 95 ). “ The rel ev an t pr od uc t m ark et in cl ud es al l reas on ab ly

in te rch an ge ab le pr od uc ts .” Dou bl e D Sp ot ti ng Serv

., 13 6 F.3 d at 56 0 (ci ti ng Que en Ci ty Pi zza, In c. v. Dom in o’s Pi zza, In c., 1 2 4 F

. 3 d 4 3 0, 43 6 (3 d Ci r. 19 97 )). In

ex cep ti on al ci rcu m st an ces , a rel ev an t m ark et can be de fin ed by th e de fen da nt ’s own

pr od uc t or se rv ic e. See East m an Kod ak Co

. v. Im ag e Te ch

. Serv s., In c., 50 4 U.S.

45 1, 4 82 (1 99 2)

.

I r mat cl ai m s th at th e rel ev an t m ark et is th e m ark et fo r m ai l-o rd er ph arma c y

se rv ic es to Exp res s Scri pt s m em be rs –a su bm ark et m ad e up of on ly Exp res s Scri pt s’s

se rv ic es wit hi n th e br oa de r m ark et of al l m ai l-o rd er ph arm acy se rv ic es

. See Bro wn Sh oe Co

. v. Uni te d St at e s , 3 7 0 U

. S

. 29 4, 32 5 (1 96 2)

. W e co nc lu de th at Irm at ’s

m ark et is to o na rro wly de fin ed

. Exp res s Scri pt s is no t th e on ly m ai l-o rd er ph arm acy

The pa rti es ag ree t ha t t he rel ev an t g eo gr ap hi c m ark et is th e Uni te d S ta te s. 3

-1 3-av ai la bl e to c o n s u mer s. Irm at th us fai ls to in cl ud e al l in te rch an ge ab le m ai l-o rd er

ph arm acy s erv ic e s i n i t s rel ev an t m ark et

. See Lit tl e Ro ck Card io lo gy Cl in ic PA v. Bap ti st Heal th

, 59 1 F.3 d 59 1, 59 7- 98 (8 th Ci r. 20 09 ) (co nc lu di ng pl ai nt iff ’s pr op os ed

rel e v a n t mar ke t was to o na rro w be cau se it om it te d po te nt ia l cu st om ers ). Fu rth er, ab se nt co nt ract ua l res tri ct io ns , th e c u s t o m ers of Irm at ’s pr op os ed m ark et –h eal th

in su ran ce pl an s– are free to ch oo se ot he r PBM s or in de pe nd en t ph arm aci es th at of fer

m ai l

- o r d e r ph arm acy se rv ic es

. See Que en Ci ty Pi zza, 12 4 F.3 d at 43 8 (ref us in g to
ad op t th e po si ti on th at “ co nt ract ua l res tra in ts ren de r ot he rwis e id en ti cal pr od uc ts

no n- in te rch an ge ab le fo r pu rp os es of rel ev an t m ark et de fin it io n” ). The di st ric t co ur t
th us co rrec tl y co nc lu de d th at Irm at ha d fai le d to pl ead a rel ev an t m ark et

. See Lit tl e
Ro ck Card io lo gy Cl in ic

, 59 1 F.3 d at 60 1 (8 th Ci r. 20 09 ) (aff irming th e di st ric t co ur t’s

di sm is sa l of pl ai nt iff ’s Sect io n 2 cl a i m b e cau se pl ai nt iff fai le d to sh ow a pr op er rel ev an t m ark et ).

Irm at al so fai ls to al le ge th at Exp res s Scri pt s en ga ge d in an ti co m pe ti ti ve

co nd uc t. “ [T]he po ss es si on of m on op ol y po wer wil l no t be fo un d un la wfu l un le ss it

is acco m pa ni ed by an el em en t of an ti co m pe ti ti ve co nd uc t .” Trin ko

, 54 0 U.S. at 40 7.

Gen e r a l l y, S e c ti on 2 of th e Sh erm an Act do es no t res tri ct th e rig ht “ of [a] t rad er or

m an uf act ur er en ga ge d in an en t i r e l y pr iv at e bu si ne ss , free ly to ex erci se hi s own in de pe nd en t di sc ret io n as to pa rti es wit h who m he wil l de al .” Id

. at 40 8 (al te rat io ns in or ig in al ) (in te rn al qu ot at io n m ark s an d ci ta ti on s om it te d)

. The Su pr em e Co ur t ha s

rec o g n i z e d a “ li m it ed ex cep ti on ” to th e rig ht to refu se to de al wit h ot he r fir m s. Id

. at 40 9 (ci ti ng Asp en Sk ii ng Co

. v. Asp en Hig hl an ds Sk ii ng Co rp ., 47 2 U.S. 58 5, 60 1 (1 98 5) ). In Asp en , th e Co ur t affi rm ed a jury ve rd ic t fo r a pl ai nt iff sk i co m pa ny th at
al le ge d th at a co m

pe ti to r sk i bu si ne ss ha d vi ol at ed Sect io n 2 of th e Sh erm an Act. Asp en , 47 2 U.S. at 59 5, 61 1. The de fen da nt ha d be gu n to se ll a di sc ou nt ed li ft ti ck et

to th e th ree sk i area s it own ed

, aft er y ears of co op erat in g wit h pl ai nt iff in se ll in g joi nt
ti ck et s to bo th th e de fen da nt ’s an d pl ai nt iff ’s sk i areas

. Id

. at 59 1- 93

. The “ li m it ed

ex cep ti on ” se t fo rth in Asp en is no t a pp li cab le he re. Irm at an d Exp res s Scri pt s di d

no t ha ve a vo lu nt ary, y ears -lo ng rel at io ns hi p reg ard in g th ei r co m pe ti ng m ai l-o rd er

-1 4-ph arm aci es

. Irm at ha s fai le d to pl au si bl y al le ge an ti co m pe ti ti ve co nd uc t on Exp res s Scri pt s’s pa rt, an d th e di st ric t co ur t th us co rrec tl y di sm is se d Irm at ’s Sect io n 2 cl ai m

.

3.

Irm at al le ge s th at Exp res s S c rip ts vi ol at ed Sect io n 1 of th e Sh erm an Act by

en ga gi ng in a tying arra ng em en t whe n it “ ex erci se d it s m ark et po wer to fo rce it s ret ai l ph arm acy ne two rk m em be rs to refr ai n fro m di sp en si ng dr ug s vi a m ai l-o rd er de li ve ry .” A t y in g arra ng em en t is “ an ag reem en t by a pa rty t o se ll o ne pr od uc t bu t

on ly on th e co nd it io n th at th e bu y er al so pu rch as es a di ffer en t (o r ti ed ) pr od uc t, or at
le as t ag rees th at he wil l no t pu rch as e th at pr od uc t fro m an y ot he r su pp li er.” East m an Kod ak

, 50 4 U.S. at 46 1- 62 (q uo ti ng N. Pac. Ry

. Co

. v. Uni te d St at es , 35 6 U.S. 1, 5- 6 (1 95 8) ).

Fo r a pl au si bl e tying cl ai m in th is si tu at io n, Irm at m us t ha ve al le ge d th at Exp res s Scri pt s co nd it io ne d pa rti ci pa ti on in it s PBM ne two rk on ei th er th e pu rch as e of a ti ed pr od uc t o r se rv ic e, or on refr ai ni ng fro m th e pu rch as e of a ti ed pr od uc t or

se rv ic e. Irm at in s t e a d al le ge s th at Exp res s Scri pt s co nd it io ne d pa rti ci pa ti on in it s
PBM ne two rk on th e req u i r e men t th at Irm at refr ai n fro m op erat in g a co m pe ti ng bu si ne ss

. Thi s, in tu rn , is a rep ack ag ed at te m pt at Irm at ’s m on op ol y cl ai m an d fai ls

fo r th e reas on s st at ed ab ov e. The di st ric t co ur t th us di d no t err in di sm is si ng Irm at ’s tying cla im

.

D.

Fi na ll y , I rm at al le ge s th at Exp res s Scri pt s vi ol at ed th e Any W il li ng Pro vi de r la ws of Geo rg ia

, Mi ss is si pp i

, a n d N or th Caro li na whe n it de ni ed Irm at th e

-1 5-op po rtu ni ty to m ai l pr es cri pt io ns to Exp res s Scri pt s m em be rs in each of th es e st at es

. 4

Irm at ha s po in te d to no cas e la w th at su gg es ts th at th es e la ws ap pl y to PBM s, an d we de cl in e to ex te nd th e reac h of th es e la ws to PBM s as a m at te r of fir st im pr es si on

. See

Ash le y Ct y ., Ark

. v. Pfi zer, In c., 55 2 F.3 d 65 9, 67 3 (8 th Ci r. 20 09 ) (co nc lu di ng th at
“i s no t th e ro le of a fed eral co ur t to ex pa nd st at e la w in way s no t fo res ha do wed by

st at e p rece de nt ”) (i nt ern al qu ot at io n m ark s an d c it at io ns om it te d)

.

III.

Irm at arg ue s t ha t th e di st ric t co ur t sh ou ld ha ve gr an te d Irm at le av e to am en d

it s co m pl ai nt to rep le ad m or e sp eci fic fact s. Bu t Irm at ne ve r m ov e d t o am en d it s

co m pl ai nt
, no r di d it req ue st su ch rel ie f in it s m em or an du m in op po si ti on to Exp res s Scri pt s’s m ot io n to di sm is s. See Uni te d St at es v. Mas k of Ka-Nefe r-Nefe r, 75 2 F.3 d

73 7, 74 2 (8 th Ci r. 20 14 ) (“ [A] di st ric t co ur t in gr an ti ng a m ot io n to di sm is s is no t
ob li ge d to in vi te a m ot io n fo r le av e to am en d if pl ai nt iff di d no t fil e on e.”). Fu rth er,
Irm at di d no t in cl ud e a pr op os ed am en dm en t in it s br ie f. See W ol gi n v. Si m on , 72 2

F.2 d 38 9, 39 5 (8 th Ci r. 19 83 ) (“ [T]o pr es erv e th e rig ht to am en d a co m pl ai nt a pa rty

m us t s ub m it a pr op os ed am en dm en t al on g wi th it s m ot io n.” ).

The di st ric t co ur t’s o rd er o f di sm is sa l i s af fir m ed

.

__ __ __ __ __ __ __ __ __ __ __ __ __ __ __

Ga. Co de Ann

. § 26 -4 -1 44 ; Mi ss

. Co de

. Ann

. § 83 -9 -6 ; an d N.C. Gen

. St at

. 4 § 5 8- 51 -3 7.

-1 6-