AbbVie, Inc. v. Ellison

Background

The court consolidated the AbbVie and AstraZeneca cases for purposes of the pending motions because they raised similar issues. The plaintiffs are drug manufacturers. They challenged Minnesota Statute § 62J.96, which requires pharmaceutical manufacturers to offer discounted pricing mandated by Section 340B of the Public Health Service Act to an unlimited number of “contract pharmacies” and makes that pricing a condition of participating in Medicaid.

The plaintiffs argued that Section 62J.96 improperly expands the federal Section 340B program by requiring discounted prices for sales through contract pharmacies. They sought declaratory and injunctive relief against Keith M. Ellison, in his official capacity as Minnesota’s Attorney General. AstraZeneca also sued members of the Minnesota Board of Pharmacy in their official capacities.

The complaints alleged that the Minnesota law was preempted by federal law and violated constitutional protections. AbbVie alleged preemption under the Supremacy Clause, a violation of the Takings Clause, and a violation of the Due Process Clause. AstraZeneca alleged preemption, a Takings Clause violation, and a Contracts Clause violation. The plaintiffs asked the court to block the Attorney General and Board of Pharmacy members from enforcing § 62J.96.

The plaintiffs did not allege that either the Attorney General or the Board of Pharmacy members had enforced the statute or threatened to enforce it. The defendants moved to dismiss.

Court’s analysis

A complaint must contain enough factual matter to make a claim for relief plausible, rather than merely stating labels, conclusions, or the elements of a claim. The court first addressed standing and Eleventh Amendment immunity.

Standing is the requirement that a plaintiff show an actual injury, a connection between that injury and the defendant’s challenged conduct, and a likelihood that a favorable decision would remedy the injury. Without standing, a federal court lacks subject-matter jurisdiction.

The court explained that the Eleventh Amendment generally protects states from suits and can also protect state officials when the state is the real party in interest. An exception allows a suit seeking to stop a state official from enforcing an unconstitutional law when the official has some connection to enforcing that law. The court treated the standing and enforcement-connection questions as related.

As to the Attorney General, the court found that the Minnesota Legislature did not expressly authorize him to enforce § 62J.96, even though it granted him enforcement authority in other parts of Chapter 62J. The court rejected the plaintiffs’ argument that the Attorney General’s general constitutional powers or Minnesota Statute § 8.31 supplied the necessary connection to enforcement.

The court reached the same conclusion as to the Board of Pharmacy members. Although the Legislature appeared to have considered giving the Board enforcement authority over § 62J.96, the court found that it did not do so. The court also relied on the absence of any allegation that either defendant had enforced or threatened to enforce the statute.

Disposition

The court held that the plaintiffs lacked standing and that Eleventh Amendment immunity applied because the defendants lacked a sufficient connection to enforcing § 62J.96. The court therefore did not reach the merits of the plaintiffs’ preemption or constitutional claims.

The court ordered that the motion to dismiss in AbbVie, Inc., et al. v. Ellison, Case No. 24-cv-2605, was granted; the motion to dismiss in AstraZeneca Pharmaceuticals LP v. Ellison, et al., Case No. 24-cv-2621, was granted; and the cases were dismissed. The order did not state whether the dismissals were with or without prejudice. Judge David S. Doty signed the order.