RX.COM, Plаintiff-Appellant v. MEDCO HEALTH SOLUTIONS, INC.; Caremark RX Inc.; Express Scripts, Inc., Defendants-Appellees.
No. 08-40388.
United States Court of Appeals, Fifth Circuit.
April 22, 2009.
332 Fed. Appx. 394
3. Equity of enforcement and the “made-whole” doctrine
Though constructive trusts and equitable liens are appropriate remedies
The subrogation provision of the plan at issue clearly provides that the Plan is entitled to reimbursement out of payments made by an injuring party, and similar provisions have been enforced by the this Court. In Sunbeam-Oster Company, Inc. v. Whitehurst, 102 F.3d 1368, 1376 (5th Cir.1996), which was relied оn by the district court, we rejected the “made whole” doctrine where it was not expressly included in the language of the plan, and held that a clear and unambiguous subrogation/reimbursement provision entitled the Plan to the full amount of medical benefits paid on the insured‘s behаlf. We follow Sunbeam-Oster and find that the subrogation/reimbursement provision in this case is equitable and not subject to the “made whole” doctrine.
4. Motion to strike new evidence
AT & T argues that Flores introduces evidence into the record on appeal that was not presented before the district court, and urges that the Court strike the proffered evidence. Much of what AT & T argues constitutes “new evidence” are actually just arguments (including conclusory assertions) made by Flores in his brief; Flores does not offer any actual evidence into the record on appeal. Thus, we DENY the mоtion to strike new evidence.
For the foregoing reasons, we DENY the motion to strike new evidence, and AFFIRM the district court‘s grant of summary judgment.
William Shawn Staples, The O‘Quinn Law Firm, Houston, TX, for Plaintiff-Appellant.
Robert K. Stanley, Indianapolis, IN, Michael Sennett, Chicago, IL, Gonzalo S. Zeballos, Simрson Thacher & Bartlett LLP, New York, NY, for Defendants-Appellees.
HAYNES, Circuit Judge:*
Plaintiff Rx.com brought this lawsuit alleging that the pharmacy benefit manag
I. Background
Defendants are pharmacy benefit managers (“PBMs“), which are third party administrators of prescription drug programs for health insurance plans, employers, unions, governmental entities, and others. From December 1998 to June 1999, Defendants discussed among themselves the threat to their business of internet pharmacies. There is some evidence that Defendants collectively decided to exclude all internet pharmacies from access to their networks to prevent the internet pharmacies from competing with Defendants’ direct mail businesses.
Rx.com applied for admission into each of the Defendants’ networks. Those requests were denied as follows: (1) by Caremark, on February 14, 2000; (2) by Medco, first on October 26, 1999 and then on February 15, 2000; and (3) by Express Scripts in February of 2000. This lawsuit was filed on October 8, 2004. Thus, unless some ground exists for tolling the statute of limitation or beginning accrual of the causes of action later than February 2000, these claims are time-barred.
II. Standard of Review
This court reviews a district court‘s grant of summary judgment de novo, applying the same standard as the district court. TIG Ins. Co. v. Aon Re, Inc., 521 F.3d 351, 354 (5th Cir.2008). Summary judgment is appropriate “if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as а matter of law.”
III. Discussion
A. Accrual
The United States Code provides that “[a]ny action to enforce any cause of action under section 15, 15a, or 15c of this title shall be forever barred unless commenced within four years after the cause of action accrued.”
The district court held that Rx.com‘s antitrust claims accrued in February 2000,
The United States Supreme Court answered this question in Rotella v. Wood, 528 U.S. 549, 555, 120 S.Ct. 1075, 145 L.Ed.2d 1047 (2000), stating, “in applying a discovery accrual rule, we have been at pains to explain that discovery of the injury, not discovery of the other elements of a claim, is what starts the clock.” Applying Rotella to the present case, the injury of which Rx.com complains is exclusion from the market by Defendants, a fact known to it in February 2000 when its application to enter into the Defendants’ networks had been denied. On February 29, 2000, Rx.com complained in writing to the FTC that “2/3 of the requests from our prospective customers have to be turnеd away because certain PBM‘s refuse to allow Rx.com into their networks.” Joseph Rosson, co-founder and CEO of Rx.com, testified in an unrelated case that he always believed that what the Defendants were doing was illegal. Even though Rx.com may not have known all the details of the Defendants’ concerted conduct, it knew it was injured, suspected illegality, and had sufficient knowledge to complain to the FTC. Under Rotella, then, the clock began to run in February of 2000.
B. Continuing Violations
Rx.com asserts that even if some of its claims accrued in February of 2000, Defendants’ continuing violations of the antitrust laws tolled limitations. Defеndants assert that there was no continuing violation, and that in any event, they only reiterated their final decisions to exclude Rx.com from their networks.
Under the continuing conspiracy theory, “each time a plaintiff is injured by an act of the defendants a cause of action accrues to him to recover the damages caused by that act and ... the statute of limitations runs from the commission of the act.” Zenith, 401 U.S. at 338, 91 S.Ct. 795; see also Kaiser Aluminum & Chem. Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1051 (5th Cir.1982); Poster Exch. v. Nat‘l Screen Serv. Corp., 517 F.2d 117, 125 (5th Cir.1975). Rx.com failed to offer evidence of “a specific аct or word of refusal during the limitations period.” Poster Exch., 517 F.2d at 129. In other words, Rx.com failed to offer evidence that Defendants reiterated their refusals to admit Rx.com to their networks during the limitations period. Thus, Rx.com failed to raise a fact issue on its “continuing violations” claim sufficient to defeat the limitations defense.
C. Fraudulent Concealment
Rx.com contends that Defendants fraudulently concealed its causes of action. In order to avoid summary judgment, Rx.com was required to raise a fact issue as to two elements: “first, that the defendants concealed the conduct complained of, and second, that the plaintiff failed, despite the exercise of due diligence on his part, to discover the facts that form the basis of his claim.” Texas v. Allan Constr. Co., 851 F.2d 1526, 1528 (5th Cir.1988) (internal quotation and citation omitted). To satisfy the first element, the defendants must have engаged in “affirmative acts of concealment.” Id. at 1531. In the present case, Rx.com argues that the secret communications between the Defendants while they each claimed they were making unilateral decisions and publicly stated they
However, “[c]oncealment by defendant only by silence is not enough. [The defendant] must be guilty of some trick or contrivance tending to exclude suspicion and prevent inquiry.” Allan Constr., 851 F.2d at 1532 (quoting Crummer Co. v. Du Pont, 255 F.2d 425, 432 (5th Cir.1958) (alteration in original)). Similarly, “denial of wrongdoing is no more an act of concealment than is silence” unless “the parties are in a fiduciary relationship, or where the circumstances indicate that it was reasonable for the plaintiff to rely on defendant‘s denial.” Id. at 1532-33. Here, there is no such affirmative act of concealment on the part of the Defendants.
D. Equitable Tolling
The issue of equitable tolling is subject to differing standards of review depending on the basis of the district court‘s decision. If the district court denied equitable tolling as a matter of law, this court‘s review is de novo. FDIC v. Dawson, 4 F.3d 1303, 1308 (5th Cir.1993). Alternatively, a denial that stems from thе district court‘s weighing of the equities is reviewed for abuse of discretion. Teemac v. Henderson, 298 F.3d 452, 456 (5th Cir.2002) (reviewing district court‘s refusal to toll Title VII limitations period on motion to dismiss for abuse of discretion); United States v. Patterson, 211 F.3d 927, 931 (5th Cir.2000) (reviewing district court‘s refusal to toll Anti-Terrorism and Effective Death Penalty Act limitations period on motion to dismiss for abuse of discretion); Fisher v. Johnson, 174 F.3d 710, 713 (5th Cir.1999) (explaining that district court‘s discretionary refusal to toll limitations should be reviewed for abuse of discretion, even where made on the pleadings). “A district court abuses its discretion when it bases its decision on an erroneous legаl conclusion or on a clearly erroneous finding of fact.” James v. Cain, 56 F.3d 662, 665 (5th Cir.1995) (citing McGary v. Scott, 27 F.3d 181, 183 (5th Cir.1994)).
In the case before us, the district court exercised discretion in not equitably tolling Rx.com‘s claims. The district court stated in its order: “[T]he Court finds that Plaintiff should be charged with the duty to pursue its claims. Since a derivative cause of action was always available to Mr. Rosson or other shareholders, the Court concludes that this does not constitute the ‘rare and exceptional circumstances’ that would equitably toll the statute of limitations.”
We have stated that “[t]he doctrine of equitable tolling preserves a plaintiff‘s claims when strict application of the statute of limitations would be inequitable.” Patterson, 211 F.3d at 930 (quoting Davis v. Johnson, 158 F.3d 806, 810 (5th Cir.1998)). “Equitable tolling applies principally where the plaintiff is actively misled by the defendant about the cause of action or is prevented in some extraordinary way from asserting his rights.” Id. at 930-31 (quoting Coleman v. Johnson, 184 F.3d 398, 402 (5th Cir.1999)).
All of the officers and directors of Rx.com resigned in May 2001, and Rx.com did not regain officers and directors until April 2004. Rx.com asserts that the resignation of its officers and directors was an exceptional circumstance warranting equitable tolling, but fails to сite any authority on point. Rather, Rx.com relies on cases discussing the adverse domination rule, which tolls limitations when the board is controlled by those culpably involved in the wrongful conduct on which the action is based. See FDIC v. Henderson, 61 F.3d 421, 425-26 (5th Cir.1995). In this case, by contrast, there was no obstacle preventing a shareholder from protecting Rx.com‘s rights. Rosson, former CEO and co-founder of Rx.com, or any other shareholder, could have called a special meeting
IV. Conclusion
For the foregoing reasons, we AFFIRM the summary judgment of the district court.
Notes
Rx.com also contends that, during a period of time, it was under a court-appointed receivership. Rx.com suggests that the pendency of the receivership is another reason supporting equitable tolling. It аrgues that the court order appointing the receiver did not specifically authorize the bringing of this type of litigation. However, the receiver in question was specifically appointed “pursuant to the applicable provisions of the ... Texas Civil Practice and Remedies Code.” The “applicable provision” allows a receiver to pursue litigation without court approval.