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KESSLER TOPAZ 

MELTZER & CHECK, LLP 

Johnston de F. Whitman, Jr. 

jwhitman@ktmc.com 

280 King of Prussia Road 

Radnor, PA 19087 

Telephone: (610) 667-7706 

Facsimile: (610) 667-7056 

-andJennifer L. Joost 

jjoost@ktmc.com 

Rupa Nath Cook 

rcook@ktmc.com 

One Sansome Street, Suite 1850 

San Francisco, CA 94104 

Telephone: (415) 400-3000 

Facsimile: (415) 400-3001 

BONNETT, FAIRBOURN, FRIEDMAN 

& BALINT, P.C. 

Francis J. Balint, Jr. 

Andrew S. Friedman 

2325 E. Camelback Road, Ste. 300 

Phoenix, AZ 85016 

Telephone: (602) 274-1100 

Facsimile: (602) 274-1199 

fbalint@bffb.com 

afriedman@bffb.com 

Attorneys for Lead Plaintiff and the 

Proposed Class 

UNITED STATES DISTRICT COURT 

DISTRICT OF ARIZONA 

Richard Di Donato, Individually and On 

Behalf of All Others Similarly Situated, 

 Plaintiff, 

 v. 

Insys Therapeutics, Inc.; Michael L. Babich; 

Darryl S. Baker; John N. Kapoor; and Alec 

Burlakoff, 

Defendants. 

No. 16-cv-00302-NVW 

CLASS ACTION 

PLAINTIFF’S PARTIAL 

OPPOSITION TO DEFENDANTS’ 

REQUEST FOR JUDICIAL NOTICE 

IN SUPPORT OF THE MOTION TO 

DISMISS THE SECOND AMENDED 

COMPLAINT 

Case 2:16-cv-00302-NVW Document 88 Filed 02/02/17 Page 1 of 6
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Lead Plaintiff Clark Miller (“Plaintiff”) respectfully submits this Partial Opposition 

to Defendants’ Request for Judicial Notice in Support of the Motion to Dismiss the Second 

Amended Complaint (Doc. 81) (the “Request for Judicial Notice”).1

 

Among the documents for which Defendants seek judicial notice is Exhibit 51 to the 

Declaration of Nicole Sornsin, which is a copy of a September 29, 2008 Corporate Integrity 

Agreement between a different pharmaceutical company, Cephalon, Inc., and the Office of 

the Inspector General of the United States Department of Health and Human Services 

(“Cephalon Agreement”). The Cephalon Agreement, between entities that are not parties to 

this action, and that expired before the Class Period in this action began, is nowhere 

referenced in the SAC. Accordingly, Plaintiff respectfully requests that the Court deny 

Defendants’ Request for Judicial Notice of the extrinsic Cephalon Agreement and disregard 

the arguments that Defendants base upon it. See DB 11-12 n.7. 

I. THE CEPHALON AGREEMENT IS INAPPROPRIATE FOR JUDICIAL 

NOTICE 

In considering a motion to dismiss a complaint pursuant to Rule 12(b)(6) of the 

Federal Rules of Civil Procedure, “[a]ll allegations of material fact are taken as true and 

construed in the light most favorable to the nonmoving party.” Cahill v. Liberty Mut. Ins. 

Co., 80 F.3d 336, 337-38 (9th Cir. 1996); see also Tellabs, Inc. v. Makor Issues & Rights, 

Ltd., 551 U.S. 308, 322 (2007) (on a motion to dismiss, “courts must consider the complaint 

in its entirety, as well as other sources courts ordinarily examine when ruling on Rule 

12(b)(6) motions to dismiss, in particular, documents incorporated into the complaint by 

reference, and matters of which a court may take judicial notice”). 

Fed. R. Evid. 201(b) provides that the Court “may judicially notice a fact that is not 

subject to reasonable dispute because it: (1) is generally known within the trial court’s 

 1

 Unless otherwise noted: (i) capitalized terms and abbreviations shall have the 

meanings ascribed to them in the Second Amended Complaint for Violation of the Federal 

Securities Laws (“SAC”) (Doc. 77); (ii) all references to “¶__” are to paragraphs in the 

SAC; (iii) all internal citations and quotation marks are omitted; (iv) all emphasis is added; 

(v) references to “Exhibit” are to exhibits to the Declaration of Nicole Sornsin (Doc. 81); 

and (vi) references to “DB” are to Defendants’ Motion to Dismiss and Memorandum of 

Points and Authorities (Doc. 85). 

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jurisdiction; or (2) can be accurately and readily determined from sources whose accuracy 

cannot be reasonably questioned.” The scope of proper judicial notice is limited, however, 

to documents referenced in the complaint, or documents upon which the allegations in the 

complaint necessarily rely. In re Calpine Corp. Sec. Litig., 288 F. Supp. 2d 1054, 1074 

(N.D. Cal. 2003). 

When reviewing motions to dismiss, courts routinely determine that documents not 

referenced in the complaint and upon which allegations of the complaint do not necessarily 

rely are irrelevant and inappropriate for judicial notice. Id. at 1076. Specifically: 

[u]pon the filing of a motion to dismiss, the PSLRA requires the Court to 

examine the complaint to determine whether there are sufficient allegations to 

state a claim for violation of the Exchange Act. . . . It is difficult to understand 

how documents not referenced in a complaint and on which allegations of the 

complaint do not necessarily rely can be relevant to the Court’s determination. 

Id. 

See also Centaur Classic Convertible Arbitrage Fund Ltd. v. Countrywide Fin., 793 F. 

Supp. 2d 1138, 1146 n.12 (C.D. Cal. 2011) (declining to take judicial notice of documents 

from a different litigation that were not referenced in the complaint and were not official 

court orders or records). 

Because the Cephalon Agreement was not referenced in the SAC, the Cephalon 

Agreement is extrinsic, irrelevant, and inappropriate for judicial notice. See, e.g., In re 

Adaptive Broadband Sec. Litig., 2002 WL 989478, at *20 (N.D. Cal. Apr. 2, 2002) 

(declining to take judicial notice of document first mentioned by defendants in their motion 

to dismiss, stating “[t]he Court cannot see any other relevance for it, thus it will not be 

judicially noticed or incorporated by reference into the Complaint”). 

II. DEFENDANTS’ ARGUMENTS BASED UPON THE CEPHALON 

AGREEMENT SHOULD BE DISREGARDED 

Based upon the extrinsic Cephalon Agreement, Defendants make the improper and 

implausible argument that Insys’ strategy of pitching Subsys to prescribers who had 

previously written off-label prescriptions of Actiq (a Cephalon fentanyl product) did not 

constitute illegal off-label marketing. DB at 11-12 n.7. Specifically, Defendants contend 

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that the extrinsic Cephalon Agreement “negat[es] any assumption that, years later, Actiq 

prescribers remained tainted by off-label marketing.” Id. 

In addition to being improper, Defendants’ argument makes no sense. The Cephalon 

Agreement, which expired on September 29, 2013 (approximately eleven months before the 

Class Period in this action began),2

 governed the actions of Cephalon – not the prescribers 

who wrote off-label prescriptions for that company’s fentanyl product. The Cephalon 

Agreement, therefore, has no bearing at all upon whether those prescribers would again 

disregard fentanyl’s dangers in writing off-label Subsys prescriptions in exchange for 

kickbacks, as was Defendants’ design in targeting them. ¶¶34, 43, 103, 115-17. 

III. CONCLUSION 

For the foregoing reasons, Plaintiff respectfully requests that the Court: (i) deny 

Defendants’ request for judicial notice of the Cephalon Agreement (Exhibit 51); and (ii) 

disregard the arguments that Defendants seek to base upon it. 

DATED: February 2, 2017 Respectfully submitted, 

KESSLER TOPAZ 

 MELTZER & CHECK, LLP 

/s/ Johnston de F. Whitman, Jr.

Johnston de F. Whitman, Jr. (admitted Pro Hac 

Vice) 

jwhitman@ktmc.com 

280 King of Prussia Road 

Radnor, PA 19087 

Telephone: (610) 667-7706 

Facsimile: (610) 667-7056 

-andJennifer L. Joost (admitted Pro Hac Vice) 

jjoost@ktmc.com 

Rupa Nath Cook (admitted Pro Hac Vice) 

rcook@ktmc.com 

One Sansome Street, Suite 1850 

San Francisco, CA 94104 

Telephone: (415) 400-3000 

Facsimile: (415) 400-3001 

 2 See Exhibit 51 at 2 Section II. A (“period of compliance” is “five years from the 

effective date,” which was September 29, 2008). 

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Lead Counsel for Lead Plaintiff and the Proposed 

Class 

BONNETT, FAIRBOURN, 

 FRIEDMAN & BALINT, P.C.

Francis J. Balint, Jr. 

Andrew S. Friedman 

2325 E. Camelback Road, Ste. 300 

Phoenix, AZ 85016 

Telephone: (602) 274-1100 

Facsimile: (602) 274-1199 

fbalint@bffb.com 

afriedman@bffb.com 

Liaison Counsel for Lead Plaintiff and the 

Proposed Class 

GOLDBERG LAW PC 

Michael Goldberg 

Brian Schall 

13650 Marina Pointe Drive 

Suite 708 

Marina Del Rey, CA 90292 

Telephone: (800) 977-7401 

Facsimile: (800) 536-0065 

michael@goldberglawpc.com 

brian@goldberglawpc.com 

Additional Counsel for Lead Plaintiff Clark Miller 

 

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CERTIFICATE OF SERVICE

I hereby certify that on February 2, 2017, I electronically transmitted the foregoing 

document to the Clerk’s Office using the CM/ECF System for filing and transmittal of a 

Notice of Electronic Filing those persons who are CM/ECF registrants: 

Daniel Slifkin

David M. Stuart 

Cravath Swaine & Moore LLP 

825 8th Ave. 

New York, NY 10019 

Tel: 212-474-1000 

Fax: 212-474-3700 

Email: dslifkin@cravath.com 

Email: dstuart@cravath.com 

Donald Wayne Bivens 

Nicole Elizabeth Sornsin 

Snell & Wilmer LLP 

1 Arizona Center 

400 E Van Buren 

Phoenix, AZ 85004-2202 

Tel: 602-382-6549 

Fax: 602-382-6070 

Email: dbivens@swlaw.com 

Email: nsornsin@swlaw.com 

/s/ Johnston de F. Whitman, Jr 

Johnston de F. Whitman, Jr.

Case 2:16-cv-00302-NVW Document 88 Filed 02/02/17 Page 6 of 6