PharmacyChecker.com LLC v. National Association of Boards of Pharmacy

Background

PharmacyChecker.com LLC (PCC) operates a website that accredits pharmacies and provides comparative drug-price information. It receives a significant portion of its revenue from fees for referring visitors to accredited pharmacy websites. The National Association of Boards of Pharmacy (NABP), described in the opinion as a competing accreditor, publishes an online “Not Recommended List” that includes PCC’s website and blog. PCC alleges that NABP’s statements about the legality and safety of PCC’s business were false and misleading and caused reduced website traffic, business, and referral revenue.

PCC’s amended complaint asserted a claim under § 43(a) of the Lanham Act, a federal law addressing certain false or misleading commercial statements. The complaint also included a Sherman Act group-boycott claim. In an earlier summary-judgment ruling, the court granted NABP’s motion on the Sherman Act claim because PCC lacked antitrust standing—meaning its alleged injury was not the type the antitrust laws were intended to address. The court explained in this opinion that the earlier ruling did not decide Article III constitutional standing, did not hold that PCC’s own business violated federal law, and did not decide whether PCC plausibly alleged a false Lanham Act claim.

NABP’s Motion

NABP moved for judgment on the pleadings under Federal Rule of Civil Procedure 12(c). The court applies the same standard used for a motion to dismiss for failure to state a claim, and it may consider only limited materials at this stage. NABP argued that PCC lacked standing because its business was illegal and that NABP’s statements were truthful based on conclusions and evidence discussed in the earlier summary-judgment ruling.

Standing

The court held that PCC plausibly alleged an injury in fact under Article III. PCC alleged that NABP’s statements led to poorer search results, reduced business, and reduced revenue. The court described monetary harm as a traditional concrete injury. It rejected NABP’s argument that PCC could not seek relief because its business was illegal, explaining that NABP had not proven that PCC itself engaged in illegal activity. The parties agreed that PCC is not a pharmacy and does not sell, dispense, or distribute unapproved drugs.

The court noted that NABP could renew its argument in a summary-judgment motion if it later obtained evidence linking PCC’s profits to illegal imports. At the pleadings stage, however, PCC adequately alleged a compensable injury to its business.

Lanham Act Claim

The court relied on its earlier ruling that PCC plausibly alleged that NABP’s statements about safety, risk, and legality were false or misleading. Among other things, PCC alleged that NABP’s statements could frighten consumers away from PCC’s website and improperly equate PCC with illegal or rogue websites. The court held that NABP had not shown a basis to revisit that earlier pleading-stage determination.

The court also declined to draw favorable inferences for NABP from the summary-judgment record. If NABP wanted the court to rely on evidence outside the pleadings, the proper procedure was a motion for summary judgment, where the parties would have a reasonable opportunity to present and contest evidence. The court assumed, without deciding, that it could consider the prior summary-judgment opinion’s substantive conclusions, but said that doing so would not change the result.

Disposition

Judge Karas denied NABP’s motion without prejudice to NABP’s ability to file a summary-judgment motion on PCC’s Lanham Act claim. The opinion therefore allowed the Lanham Act claim to continue at that point; it did not decide the ultimate truth of NABP’s statements or the claim’s final merits.