United Food & Commercial Workers Central Pennsylvania & Regional Health & Welfare Fund v. Amgen, Inc.

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UNITED FOOD & COMMERCIAL WORKERS CENTRAL PENNSYLVANIA & REGIONAL HEALTH & WELFARE FUND, et al., Plaintiffs-Appellants, v. AMGEN, INC., Defendant-Appellee.

No. 09-56118

United States Court of Appeals, Ninth Circuit

Argued and Submitted Oct. 8, 2010. Filed Oct. 21, 2010.

255-258

Exchange Act violations related to the Severance Plans are clearly encompassed by the Settlement Agreement. However, CBA argues the recommendations regarding the Severance Plans and the Pay for Performance Proposal, though similar in nature, are factually independent and the Pay for Performance recommendation has nothing to do with conduct covered by the Settlement Agreement.

The District Court found that both recommendations are rooted in the Proxy Statement itself, which is encompassed by the Settlement Agreement. We agree. Because the Pay for Performance recommendation was part of the Proxy Statement and the Proxy Statement is encompassed by the Settlement Agreement, all claims arising out of the Proxy Statement are barred by the Settlement Agreement.

Finally, the District Court denied CBA leave to amend its complaint because the court viewed any attempt to cure the complaint‘s deficiencies to be futile. CBA highlights this court‘s strong policy favoring amendments of pleadings,

Bowles, 198 F.3d at 757, but does not identify any plausible facts which could be alleged to save its claims. Because it is not clear what facts could be alleged to cure CBA‘s complaint deficiencies and CBA suggests none, the District Court did not abuse its discretion in denying leave to amend.

AFFIRMED.

Brandon M. Anderson, Esquire, Joseph M. Burns, Esquire, Jacobs Burns Orlove Stanton & Hernandez, Ben Barnow, Esquire, Barnow and Associates, P.C., Marvin A. Miller, Miller Law LLC, Chicago, IL, Timothy J. Becker, Esquire, Zimmer-man Reed, PLLP, Minneapolis, MN, Harry R. Blackburn, Esquire, Harry R. Blackburn & Associates, P.C., Medford, NJ, Robert Anthony Cantore, Esquire, Gilbert & Sackman A Law Corporation, Roderick George Dorman, Mieke K. Malmberg, Hennigan Bennett & Dorman, LLP, Los Angeles, CA, David M. Cook, Cook Portune & Logothetis, Cincinnati, OH, Henri Oliver Harmon, Jason J. Thompson, Somers Schwartz, Southfield, MI, Edith M. Kallas, Joe R. Whatley, Jr., Whatley Drake & Kallas LLC, New York, NY, Gerald Lawrence, Lowey Dannenberg Cohen & Hart PC, W. Conshohocken, PA, Alan M. Mansfield, Esquire, The Consumer Law Group, San Diego, CA, Brian J. McCormick, Esquire, Stephen A. Sheller, Esquire, Sheller P.C., Philadelphia, PA, Tracy D. Rezvani, Finkelstein, Thompson & Loughran, Washington, DC, Nicholas Brian Roth, Eyster Key Tubb Roth Middleton & Adams LLP, Decatur, AL, Peter Dexter St. Phillip, Jr., Lowey Dannenberg Cohen & Hart, P.C., White Plains, NY, James Gerard Stranch, IV, Esquire, Branstetter Stranch & Jennings PLLC, Nashville, TN, for Plaintiffs-Appellants.

Sheila S. Brinbaum, Esquire, Mark Cheffo, Barbara Wrubel, James Russell Jackson, Esquire, Akadden, Arps, Slate, Meagher and Flom, New York, NY, Ronni Fuchs, Dechert LLP, Princeton, NJ, Darrel J. Hieber, Esquire, Skadden, Arps, Slate, Meagher & Flom LLP, Los Angeles, CA, Robert Limbacher, Will W. Sachse, Dechert LLP, Philadelphia, PA, for Defendant-Appellee.

Before: PREGERSON, D.W. NELSON and IKUTA, Circuit Judges.

MEMORANDUM^*

Appellants’ complaint cannot survive a motion to dismiss because it failed to plead its allegations of fraud under RICO, 18 U.S.C. § 1962(c), and California‘s Unfair Competition Law (“UCL“), Cal. Bus. & Prof. Code § 17200 et seq., with particularity. See Fed.R.Civ.P. 9(b); see also

Kearns v. Ford Motor Co., 567 F.3d 1120, 1124-25 (9th Cir.2009);

Alan Neuman Prods., Inc. v. Albright, 862 F.2d 1388, 1392 (9th Cir.1988). The complaint did not identify statements or representations made by Amgen that were literally false or misleading at the time they were made, as required in a civil RICO action based on mail and wire fraud. See

Schreiber Distrib. Co. v. Serv-Well Furniture Co., 806 F.2d 1393, 1399-1401 (9th Cir.1986); see also 18 U.S.C. §§ 1341 (mail fraud), 1343 (wire fraud), 1962(c) (RICO). Nor did the complaint identify material omissions in derogation of an independent statutory or fiduciary duty to disclose.

Cal. Architectural Bldg. Prods., Inc. v. Franciscan Ceramics, Inc., 818 F.2d 1466, 1472 (9th Cir.1987). Though the complaint alleged that Amgen concealed adverse test results while promoting Aranesp and Epogen for various off-label uses, the complaint did not identify any concealed study results that involved the drugs and uses that Amgen is alleged to have directly promoted, and Appellants confirmed at oral argument that there were none.

Moreover, the complaint failed to plead a cognizable theory of proximate causation that links Amgen‘s alleged misconduct to Appellants’ alleged injury.

Bridge v. Phoenix Bond & Indem. Co., 553 U.S. 639, 654-55, 128 S.Ct. 2131, 170 L.Ed.2d 1012 (2008). Instead, the complaint proffered an attenuated causal chain that involved at least four independent links, namely, (1) the USP-DI‘s listing of Aranesp for anemia of cancer, (2) Medicare‘s decision to cover Aranesp for anemia of cancer, (3) third-party payors’ decision to cover Aranesp for anemia of cancer (in addition to covering Aranesp for anemia in heart failure patients and cancer directly, and Epogen for all of these uses), and (4) doctors’ decisions to prescribe Aranesp and Epogen for these uses. This causal theory is too attenuated to satisfy the Supreme Court‘s proximate causation requirement in the RICO context. See

Hemi Group, LLC v. City of New York, — U.S. —, —, 130 S.Ct. 983, 989, 175 L.Ed.2d 943 (2010) (quoting

Holmes v. Sec. Investor Prot. Corp., 503 U.S. 258, 268, 271, 274, 112 S.Ct. 1311, 117 L.Ed.2d 532 (1992)).

The complaint also failed to satisfy Rule 9(b) with respect to its UCL claims,

Kearns, 567 F.3d at 1125, because it did not explain why Amgen‘s conduct was fraudulent,

id., or allege an adequate theory of causation or reliance.

In re Tobacco II Cases, 46 Cal.4th 298, 306, 93 Cal. Rptr.3d 559, 207 P.3d 20 (2009); see also

Hall v. Time Inc., 158 Cal.App.4th 847, 855-56 & nn. 2-3, 70 Cal.Rptr.3d 466 (Ct. App.2008). Because the complaint sounded in fraud, all of its allegations are subject to Rule 9(b)‘s pleading requirements.

Kearns, 567 F.3d at 1125;

Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1103-04 (9th Cir.2003). Consequently, the district court properly dismissed the complaint in its entirety, including its UCL “unlawful” and “unfair” claims.

Appellants’ failure to add the requisite particularity to the complaint, even after the district court previously granted Appellants leave to amend with specific instructions about how to cure the defects in the complaint, is “‘a strong indication that the plaintiffs have no additional facts to plead.‘”

Zucco Partners, LLC v. Digimarc Corp., 552 F.3d 981, 1007 (9th Cir. 2009) (quoting

In re Vantive Corp. Sec. Litig., 283 F.3d 1079, 1098 (9th Cir.2002)). Moreover, a district court‘s discretion to deny leave to amend is “particularly broad” where, as here, the plaintiff has previously filed an amended complaint.

Chodos v. West Publ‘g Co., 292 F.3d 992, 1003 (9th Cir.2002) (quoting

Griggs v. Pace Am. Grp., Inc., 170 F.3d 877, 879 (9th Cir.1999)) (internal quotation marks omitted). Because Appellants have previously failed to remedy the defects in their complaint, and those defects appear to be incurable,

Leadsinger, Inc. v. BMG Music Publ‘g, 512 F.3d 522, 532 (9th Cir.2008) (quoting

Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962)), the district court did not abuse its discretion in dismissing Appellants’ complaint with prejudice.

AFFIRMED.

Notes

*

This disposition is not appropriate for publication and is not precedent except as provided by 9th Cir. R. 36-3.

Case Details

Case Name: United Food & Commercial Workers Central Pennsylvania & Regional Health & Welfare Fund v. Amgen, Inc.

Court Name: Court of Appeals for the Ninth Circuit

Date Published: Oct 21, 2010

Citation: 400 F. App'x 255

Docket Number: 09-56118

Court Abbreviation: 9th Cir.