In Re Glumetza Antitrust Litigation

Background

Humana sought leave to file a second amended complaint after the court dismissed its state-law claims for lack of Article III standing. Article III standing is the constitutional requirement that a plaintiff show an actual injury, a connection between that injury and the defendants’ conduct, and a remedy the court can provide. Humana’s proposed amendment would have added more detailed allegations about its purchases of Glumetza in the states whose laws it invoked.

The court described the case as a consolidated antitrust challenge involving brand-name and generic versions of Glumetza. Humana joined the litigation approximately eleven months after the first case was filed, months into discovery, and near class-certification proceedings. The court stated that Humana could opt out of the federal direct-purchaser class and pursue its federal antitrust claims independently, but the parties disputed whether Humana could revive its 137 state-law claims.

Analysis

Federal Rule of Civil Procedure 15(a) generally calls for permission to amend a complaint when justice requires it. But because the case schedule had progressed beyond the ordinary pleading stage, the court applied Rule 16(b)(4), which permits changing the schedule only for “good cause.” The central question was whether Humana had diligently pursued the proposed amendment.

The court found that Humana had not acted diligently. Earlier orders had explained that standing for each state-law claim depended on allegations showing a Glumetza purchase in the relevant state. Humana’s earlier complaint did not identify where the purchases occurred. The court noted that Humana’s expert report, served on the same day Humana first amended its complaint, contained purchase information organized by date, pharmacy, state, price, and Humana member. The court therefore found that the information needed for the proposed allegations had been within Humana’s control from the beginning.

The court rejected Humana’s argument that the specific standing issue had not been raised by defendants earlier. It stated that standing remained Humana’s burden regardless of whether defendants challenged it and that the court could address standing on its own. The court said the proposed complaint appeared to correct the standing deficiency, but expressly stated that it was not deciding whether the new allegations actually satisfied Article III.

Disposition

The court denied Humana’s motion to amend and rejected its attempt to revive the 137 state-law claims. The order did not question Humana’s ability to opt out of the federal direct-purchaser class and proceed alongside the other plaintiffs on its federal antitrust claims. The court ordered Humana to state in writing by February 8 whether it would proceed as an opt-out plaintiff or return to the direct-purchaser class, assuming no objections. Judge William Alsup signed the order.