CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 1 of 36
`
`
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF MINNESOTA
`
`
`
`
`
`
`
`Case No: 0:20-cv-02071
`
`HON. SUSAN RICHARD NELSON
`HON. ELIZABETH COWAN
`WRIGHT
`
`
`
`BCBSM, Inc., Health Care Service
`Corporation, Molina Healthcare, Inc., and
`Blue Cross and Blue Shield of Florida, Inc.,
`
`
`
`
`
` Plaintiffs,
`
`
`
`
` v.
`
`Celgene Corporation and Bristol-Myers
`Squibb Corporation,
`
`
`
`
`
` Defendants.
`
`
`
`
`
`
`MEMORANDUM OF LAW IN OPPOSITION TO
`DEFENDANTS’ MOTION TO DISMISS FOR LACK OF PERSONAL
`JURISDICTION, OR, IN THE ALTERNATIVE, TO TRANSFER VENUE
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 2 of 36
`
`
`
`TABLE OF CONTENTS
`
`TABLE OF AUTHORITIES ..................................................................................................................... ii
`
`INTRODUCTION ........................................................................................................................................ 1
`
`FACTS .................................................................................................................................................. 3
`
`ARGUMENT ...................................................................................................................................... 7
`
`I.
`
`The Court must make a threshold ruling on its subject matter jurisdiction
`before it can determine whether it has the power to decide Defendants’
`other motions. ............................................................................................................. 7
`
`A. Legal Standard ............................................................................................................. 7
`
`B. Before deciding any other motions, the Court should first determine that it
`has subject matter jurisdiction .................................................................................. 8
`
`II.
`
`This Court has specific personal jurisdiction over Defendants, or, at the bare
`minimum, fact discovery is needed to establish personal jurisdiction. ............. 10
`
`A. Legal Standard ........................................................................................................... 10
`
`B. Plaintiffs plead sufficient facts to establish personal jurisdiction over
`Defendants ................................................................................................................ 12
`
`C. If additional proof is necessary to establish personal jurisdiction, the Court
`should permit Plaintiffs to take jurisdictional discovery ..................................... 15
`
`III. Defendants’ motion to transfer the action to the District of New Jersey should
`be denied. ................................................................................................................... 16
`
`A. Legal Standard. .......................................................................................................... 16
`
`B. An analysis of the relevant factors demonstrates that venue is properly laid in
`this District ................................................................................................................ 18
`
`1. The convenience of the parties does not favor transfer ............................... 18
`
`2. The convenience of the witnesses does not favor transfer .......................... 20
`
`3. The interests of justice do not favor transfer ................................................. 21
`
`a. Factor No. 1: Plaintiffs’ choice of forum ........................................... 21
`
`b. Factor No. 2: Docket congestion in the proposed transferee
`court ......................................................................................................... 22
`
`c. Factor No. 3: Judicial Economy .......................................................... 23
`
`d. Factor No. 4: Familiarity with the applicable law .............................. 26
`
`CONCLUSION ................................................................................................................................ 27
`
`i
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 3 of 36
`
`
`
`TABLE OF AUTHORITIES
`
`Cases
`
`Advanced Logistics Consulting, Inc. v. C. Enyeart LLC,
`CNo. 09-cv-720 (RHK/JJG), 2009 WL 1684428 (D. Minn. June 16, 2009) ....................... 18
`
`
`Ahlstrom v. Clarent Corp.,
` No. 02-cv-0789, 2002 WL 31856386 (D. Minn. Dec. 19, 2002) ............................................. 19
`
`Andersen v. Sportmart, Inc.,
`179 F.R.D. 236 (N.D. Ind. 1998) ................................................................................................ 12
`
`Atlas IP, LLC v. Boston Scientific Corp.,
`No. 14-cv-20596, 2014 WL 11910629 (S.D. Fla. July 9, 2014) ............................................... 24
`
`Bae Systems Land & Armaments L.P. v. Ibis Tek., LLC,
`124 F. Supp. 3d 878 (D. Minn. 2015) .................................................................................. 18, 20
`
`Bandemer v. Ford Motor Company,
` 931 N.W.2d 744 (Minn. 2019), cert granted, 140 S. Ct. 916 (Jan. 17, 2020) ............................. 10
`
`Bristol-Myers Squibb v. Superior Court of California,
`137 S. Ct. 1773 (2017) ........................................................................................................ 9, 10, 11
`
`Burger King Corp. v. Rudzewicz,
`471 U.S. 462 (1985) ....................................................................................................................... 11
`
`Caddy Prods., Inc. v. Seating Concepts, LLC,
`No. 05-cv-1231 JRT/FLN, 2006 WL 1085144 (D. Minn. Apr. 24, 2006) ............................ 26
`
`Cantor Fitzgerald, L.P. v. Peaslee,
`88 F.3d 152 (2d Cir. 1996) .............................................................................................................. 8
`
`Codapro Corp. v. Wilson,
`997 F. Supp. 322 (E.D.N.Y. 1998) ................................................................................................ 9
`
`
`Cosmetic Warriors Ltd. v. Abrahamson,
` 723 F. Supp. 2d 1102 (D. Minn. 2010) ....................................................................................... 19
`
`Cunningham v. Bombay Productions, Inc.,
`309 F. Supp. 2d 835 (S.D. W.Va. 2004) ........................................................................................ 9
`
`Dakota, Minnesota & Eastern R.R. Corp. v. Schieffer,
`715 F.3d 712 (8th Cir. 2013) .......................................................................................................... 8
`
`ii
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 4 of 36
`
`
`
`Datalink Corp. v. Perkins Eastman Archs., P.C.,
`33 F. Supp. 3d 1068 (D. Minn. 2014) .................................................................................. 17, 21
`
`Downing v. Goldman Phipps, PLLC,
`764 F.3d 906 (8th Cir. 2014) ........................................................................................................ 14
`
`Eagle’s Flight of Am., Inc. v. Play N Trade Franchise, Inc.,
`No. 10-cv-1208 (RHK/JSM), 2011 WL 31726 (D. Minn. Jan. 5, 2011) ................................ 21
`
`Graff v. Qwest Communications Corp.,
`33 F. Supp. 2d 1117 (D. Minn. 1999) ......................................................................................... 17
`
`Gulf Oil Corp. v. Gilbert,
`330 U.S. 501 (1947) ....................................................................................................................... 17
`
`Hanson v. Denckla,
`357 U.S. 235 (1958) ....................................................................................................................... 11
`
`In re Apple, Inc.,
`602 F.3d 909 (8th Cir. 2010) ................................................................................................. 17, 22
`
`In re Flonase Antitrust Litig.,
`815 F. Supp. 2d 867 (E.D. Pa. 2011) .......................................................................................... 12
`
`In re Restasis (Cyclosporine Opthalmic Emulsion) Antitrust Litig.,
`335 F.R.D. 1 (E.D.N.Y. 2020) ..................................................................................................... 13
`
`In re Zetia Ezetimibe Antitrust Litig.,
`MDL No. 2:18-md-2836, 2020 WL 5778756 (E.D. Va. Aug. 13, 2020) ............................... 13
`
`Int’l Shoe Co. v. Washington,
`326 U.S. 310 (1945) ....................................................................................................................... 10
`
`Ivey v. McKinley Med., LLC,
`No. 08-cv-6407, 2009 WL 8712424 (D. Minn. Dec. 14, 2009) ............................................... 24
`
`Johnson v. Arden,
`614 F.3d 785 (8th Cir. 2010) ........................................................................................................ 11
`
`Johnson v. Welsh Equip., Inc.,
`518 F. Supp. 2d 1080 (D. Minn. 2007) ....................................................................................... 21
`
`Johnson v. Woodcock,
`444 F.3d 953 (8th Cir. 2006) ........................................................................................................ 10
`
`Keeton v. Hustler Magazine, Inc.,
`465 U.S. 770 (1984) ....................................................................................................................... 14
`
`iii
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 5 of 36
`
`
`
`Klatte v. Buckman, Buckman & Reid, Inc.,
`995 F. Supp. 2d 951 (D. Minn. 2014) ......................................................................................... 20
`
`K–V Pharm. Co. v. J. Uriach & CIA, S.A.,
`648 F.3d 588 (8th Cir. 2011) ................................................................................................. 11, 13
`
`Lucky Break Wishbone Corporation v. Sterling Jewelers, Inc.,
`No. 10-cv-4394 (PAM/JJG), 2011 WL 13233569 (D. Minn. Jan. 25, 2011) ......................... 21
`
`Magdalena v. Toyota Motor Corporation,
` No. 12-cv-20661, 2013 WL 12092086 (S.D. Fla. July 10, 2013) ............................................... 8
`
`Massachusetts School of Law at Andover, Inc. v. American Bar Ass’n,
`107 F.3d 1026 (3d Cir. 1997) ....................................................................................................... 12
`
`My Pillow, Inc. v. LMP Worldwide, Inc.,
`331 F. Supp. 3d 920 (D. Minn. 2018) ......................................................................................... 21
`
`Myers v. Casino Queen, Inc.,
`689 F.3d 904 (8th Cir. 2012) ................................................................................................. 11, 15
`
`Nelson v. Master Lease Corp.,
`759 F. Supp. 1397 (D. Minn. 1991) ............................................................................................. 20
`
`Northbrook Digital LLC v. Vendio Services, Inc.,
`No. 07-cv-2250 (PJS/JJG), 2008 WL 2390740 (D. Minn. Apr. 4, 2008) ............................... 19
`
`Nowak v. Tak How Invs., Ltd.,
`94 F.3d 708 (1st Cir. 1996) ........................................................................................................... 11
`
`Pederson v. Frost,
`951 F.3d 977 (8th Cir. 2020) ........................................................................................................ 11
`
`Piper Aircraft Co. v. Reyno,
`454 U.S. 235 (1981) ....................................................................................................................... 18
`
`Powell v. I-Flow Corp.,
`711 F. Supp. 2d 1012 (D. Minn. 2010) ....................................................................................... 24
`
`Radisson Hotels Int’l, Inc. v. Westin Hotel Co.,
`931 F. Supp. 638 (D. Minn. 1996) ............................................................................................... 27
`
`Reid v. The Wailers,
`606 F. Supp. 2d 627 (E.D. Va. 2009) ............................................................................................ 9
`
`Ruhrgas AG v. Marathon Oil Co.,
`526 U.S. 574 (1999) .....................................................................................................................7, 9
`
`iv
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 6 of 36
`
`
`
`Schults & Adams LLP v. Commercial Tenant Services, Inc.,
`No. 4:19-cv-96-DPM, 2019 WL 3307217 (E.D. Ark. July 22, 2019) ..................................... 22
`
`Sheet Metal Workers Local 441 Health & Welfare Plan v. GlaxoSmithKline, PLC,
`737 F. Supp. 2d 380 (E.D. Pa. 2010) .......................................................................................... 12
`
`Sloan v. Gen. Motors LLC,
`287 F. Supp. 3d 840 (N.D. Cal. 2018) ........................................................................................ 10
`
`Steel Co. v. Citizens for a Better Environment,
`523 U.S. 83 (1998) .......................................................................................................................1, 8
`
`Stewart Org., Inc. v. Ricoh Corp.,
`487 U.S. 22 (1988) ......................................................................................................................... 16
`
`StoreWorks Technologies, Limited v. Aurus, Inc.,
`No. 19-cv-1527 (SRN/HB), 2020 WL 336025 (Jan. 21, 2020) .............................................. 18
`
`Tenenbaum v. Bialick,
`No. 19-cv-0212, 2019 WL 3822311 (D. Minn. Aug. 15, 2019) ................................................. 8
`
`Terra Intern., Inc. v. Mississippi Chemical Corp,
`119 F.3d 688 (8th Cir. 1999) ....................................................................................... 2, 16, 17, 18
`
`The Valspar Corporation v. PPG Industries, Inc.,
`No. 16cv1429 (SRN/SER), 2016 WL 6534414 (D. Minn. Nov. 3, 201 ........................ passim
`
`Travel Tags, Inc. v. Performance Printing Corp.,
`636 F. Supp. 2d 833 (D. Minn. 2007) ......................................................................................... 16
`
`Van Dusen v. Barrack,
`376 U.S. 612 (1964) ....................................................................................................................... 17
`
`Viasystems, Inc. v. EBM–Papst St. Georgen GmbH & Co., KG,
`646 F.3d 589 (8th Cir. 2011) ........................................................................................................ 12
`
`Vista Healthplan, Inc. v. Cephalon, Inc.,
`No. 2:06–cv–1833, 2015 WL 3623005 (E.D. Pa. June 10, 2015) ............................................ 13
`
`Warner-Lambert Co. v. Apotex Corp.,
`No. 98 C 4293, 2001 WL 854854 (N.D. Ill. July 27, 2001) ...................................................... 25
`
`Wells Dairy, Inc. v. Food Movers Int’l, Inc.,
`607 F.3d 515 (8th Cir. 2010) ........................................................................................................ 11
`
`Willis Electric Co. v. Polygroup Macau Limited (BVI),
`437 F. Supp. 3d 693 (D. Minn. 2020) ......................................................................................... 11
`
`v
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 7 of 36
`
`
`
`Statutes
`
`28 U.S.C. § 1331 ................................................................................................................................ 17
`
`28 U.S.C. § 1404 ............................................................................................................... 2, 16, 17, 18
`
`28 U.S.C. § 1447(c) .............................................................................................................................. 8
`
`MINN. STAT. § 8.31 ............................................................................................................................. 5
`
`MINN. STAT. § 325F.69 ....................................................................................................................... 5
`
`MINN. STAT. § 543.19 ....................................................................................................................... 11
`
`MINN. STAT. §§ 325D.25 .................................................................................................................... 5
`
`MINN. STAT. §§ 325D.43 .................................................................................................................... 5
`
`Rules
`
`FED. R. CIV. P. 20(a) ......................................................................................................................... 22
`
`
`
`
`
`
`
`
`
`
`vi
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 8 of 36
`
`
`
`INTRODUCTION
`
`
`
`Plaintiffs BCBSM, Inc. (“BCBSM”), Health Care Service Corporation (“HCSC”),
`
`Molina Healthcare, Inc. (“Molina”), and Blue Cross and Blue Shield of Florida, Inc. (“BCBS
`
`Florida”) filed this action in Minnesota state court asserting state law claims to recover
`
`overcharges they paid for (the already ultra-expensive) prescription drugs Revlimid and
`
`Thalomid. Plaintiffs contend that Defendants Celgene Corporation and Bristol-Myers
`
`Squibb Company (collectively, “Defendants”) orchestrated a multi-faceted scheme to delay
`
`generic competition for these two drugs. Defendants now move to dismiss for lack of
`
`personal jurisdiction, or, in the alternative, to transfer venue to the District of New Jersey
`
`where some (but not all) cases involving similar (but not completely overlapping) claims are
`
`pending.
`
`Subject Matter Jurisdiction: As a threshold matter, this Court lacks subject matter
`
`jurisdiction over this case. Plaintiffs assert solely state law claims against non-diverse
`
`Defendants, so the action should be remanded to Minnesota state court. See Plaintiffs’
`
`Memorandum in Support of their Motion to Remand, ECF No. 25. At the very least, the
`
`Court should ascertain whether it has subject matter jurisdiction—it does not—before it
`
`wades into the Defendants’ motions to dismiss (ECF Nos. 39 and 45) or their motion to
`
`transfer the case to the District of New Jersey (ECF No. 45). See Steel Co. v. Citizens for a
`
`Better Environment, 523 U.S. 83, 94-95 (1998) (“The requirement that jurisdiction be
`
`established as a threshold matter springs from the nature and limits of the judicial power of
`
`the United States and is inflexible and without exception.”) (citation omitted).
`
`Should the Court nevertheless determine it has subject matter jurisdiction,
`
`1
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 9 of 36
`
`
`
`Defendants’ motions to dismiss or in the alternative to transfer should be denied in their
`
`entirety.1
`
`Personal Jurisdiction: Defendants’ argument that the Court lacks personal jurisdiction
`
`over Defendants fails. Plaintiffs plead that Defendants engaged in a multi-faceted scheme to
`
`maintain monopoly prices for Revlimid and Thalomid in Minnesota, directed the drugs to be
`
`dispensed in Minnesota, and sold the drugs to Plaintiffs in Minnesota at artificially inflated
`
`prices. That is more than enough to establish personal jurisdiction. To the extent additional
`
`proof is needed, jurisdictional discovery is warranted.
`
`Transfer Pursuant to § 1404: Careful analysis of each of the factors courts consider on a
`
`motion to transfer venue demonstrates that transfer of this case to the District of New
`
`Jersey, Defendants’ home forum, is unwarranted. Transfer will not yield increased
`
`efficiencies sufficient to deprive Plaintiffs of their right to choose their forum.
`
`First, BCBSM, a Minnesota resident, chose to file in its home forum, and that choice
`
`is due “considerable deference.” Terra Int’l, Inc. v. Mississippi Chemical Corp., 119 F.3d 688, 695
`
`(8th Cir. 1999); The Valspar Corporation v. PPG Industries, Inc., No. 16-cv-1429 (SRN/SER),
`
`2016 WL 6534414, at *5 (D. Minn. Nov. 3, 2016) (Nelson, J.) (plaintiff’s choice due “great
`
`weight” when filing in its home forum).
`
`Second, Defendants seek transfer to a significantly more congested District of New
`
`Jersey (with fifteen times as many cases and only five more district judges). This will lead to
`
`
`1 This memorandum of law responds to Defendants’ Motion to Dismiss for Lack of
`Personal Jurisdiction, or in the Alternative, to Transfer Pursuant to 28 U.S.C. § 1404(a), ECF
`No. 39 (“PJ/Transfer Motion”). Defendants also filed a separate Motion to Dismiss
`Pursuant to Rule 12(b)(6), ECF No. 45, and Plaintiffs respond to that separately.
`
`2
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 10 of 36
`
`
`
`further delays in adjudicating Defendants’ monopolistic scheme.
`
`Third, the related cases in the District of New Jersey have been and are being
`
`presided over by multiple district (and magistrate) judges—without any attempt by Celgene
`
`to consolidate those actions. Obviously, this action can be transferred to only a single judge.
`
`Moreover, there are related cases now pending in multiple district and state courts outside of
`
`New Jersey. Transferring this single action to one judge that previously dealt with certain
`
`parts of Defendants’ elaborate anticompetitive scheme does not and cannot cure the
`
`multiple evils Defendants suggest will befall the parties and the courts if transfer is denied.
`
`Fourth, HCSC asserts state law claims stemming from Defendants’ unlawful
`
`marketing scheme which are unique to this case. Because transfer will produce no judicial
`
`efficiencies as to those claims, the motion should be denied.
`
`FACTS
`
`Plaintiffs:
`
`
`
`Plaintiffs are four large health benefit plans that collectively provide prescription drug
`
`benefits to millions of people. Plaintiffs have multiple ties to Minnesota. BCBSM is a
`
`nonprofit health care service plan corporation organized under the laws of Minnesota, with a
`
`principal place of business in Eagan, Minnesota. Compl., ECF No. 1-1, ¶ 21. Plaintiffs
`
`HCSC, BCBSM, and BCBS Florida all partially own Prime Therapeutics LLC (“Prime”), a
`
`pharmacy benefit manager2 (“PBM”) for HCSC, BCBSM, and BCBS Florida that is
`
`
`2 PBMs are companies that administer drug benefit programs for health plans like Plaintiffs
`and employers. Among other tasks, PBMs develop and maintain formularies, negotiate with
`pharmacies and drug manufacturers to manage costs, and process claims for pharmaceutical
`benefits. Compl. ¶ 37.
`
`3
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 11 of 36
`
`
`
`domiciled and organized under the laws of Minnesota. Prime, also headquartered in Eagan,
`
`Minnesota, operates Prime Therapeutics Specialty Pharmacy LLC which dispenses Thalomid
`
`and Revlimid.3 Id. ¶ 20.
`
`
`
`Plaintiffs jointly filed this case on August 31, 2020 in Minnesota state court against
`
`Defendants Celgene and Bristol-Myers Squibb which are both corporations organized under
`
`the laws of Delaware with principal places of business in New Jersey. Id. ¶¶ 26-27. There is
`
`not complete diversity between the parties. See id. ¶¶ 21-27. Defendants nonetheless
`
`removed this case to federal court on September 29, 2020. ECF No. 1. Plaintiffs filed their
`
`Motion for Remand, ECF No. 24, on October 29, 2020.
`
`Plaintiffs’ Antitrust Claims:
`
`Plaintiffs allege that in order to protect its monopoly over (ultra-expensive) brand
`
`name drugs Thalomid and Revlimid, Celgene engaged in a multi-faceted scheme to
`
`unlawfully block generic competition. Specifically, Plaintiffs allege that Celgene: (1)
`
`manipulated the FDA’s “REMS program”4 through pretextual and misleading
`
`communications to the Food and Drug Administration (“FDA”) in order to refuse to
`
`provide samples to would-be generic competitors and delay competition; (2) prevented
`
`pharmacies and ingredient suppliers from acting as alternative sources of these samples; (3)
`
`fraudulently obtained patents for the drugs; (4) serially commenced “sham” patent
`
`
`3 Revlimid and Thalomid are in a group of drugs that frequently require dosing adjustments,
`intensive clinical monitoring, the need for customer training, specialized product
`administration requirements and are generally provided only through specialty pharmacies,
`such as Prime Therapeutics Specialty Pharmacy LLC. Compl. ¶ 469.
`
`4 For certain drugs, FDA requires a Risk Evaluation and Mitigation Strategies (“REMS”)
`program, to ensure that the benefits of a drug outweigh its risks.
`
`4
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 12 of 36
`
`
`
`infringement lawsuits; and (5) authorized and certified specialty pharmacies (including
`
`Prime’s in Minnesota), to implement its S.T.E.P.S. and RevAssist programs to restrict
`
`distribution of Revlimid and Thalomid to would be competitors. Compl. ¶¶ 4, 94, 103-12.
`
`Celgene’s conduct had the cumulative and intended effect of delaying entry of much cheaper
`
`generic versions of Thalomid and Revlimid by several years. Id. ¶¶ 4, 10, 445. A generic is
`
`still not on the market. Id. ¶ 433. This has enabled Defendants to price the drugs at
`
`unrestrained levels. Id. ¶¶ 6-9, 433-34. A 28-day supply of Revlimid costs patients and their
`
`health insurers as much as $20,000, and a 28-day supply of Thalomid costs them as much as
`
`$10,000. Id. ¶ 6.
`
`Plaintiffs assert claims under Minnesota antitrust laws which prohibit monopolization
`
`and attempted monopolization, MINN. STAT. §§ 325D.25, et seq, and Minn. Stat. § 8.31, et
`
`seq., and Minnesota consumer protection laws, MINN. STAT. §§ 325D.43, et seq., MINN. STAT.
`
`§ 325F.69, et seq., and MINN. STAT. §§ 8.31, et seq., in connection with Plaintiffs’ purchases of
`
`Revlimid and Thalomid at pharmacies located in Minnesota. Compl. ¶¶ 460-70. Specifically,
`
`HCSC paid approximately $57,000 for Thalomid in pharmacies located in Dakota County
`
`and $675,000 for members residing in Eagan, Minnesota. Id. ¶ 20. Additionally, BCBS
`
`Florida paid approximately $37,000 for Revlimid at pharmacies located in Dakota County.
`
`Id. BCBSM, which serves 2.6 million members (amounting to roughly one in three
`
`Minnesotans), and Molina, which serves 3.4 million members, have continuously paid
`
`millions of dollars for their respective members’ Thalomid and Revlimid prescriptions
`
`during the period in time that Defendants have foreclosed generic competition. See id. ¶¶
`
`450, 467. Because these insurers operate nationwide, and the effects of Defendants’ scheme
`
`5
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 13 of 36
`
`
`
`caused damage nationwide, Plaintiffs also allege similar claims under additional state laws,
`
`and seek an injunction. Id. ¶¶ 554-74.5
`
`Other related Revlimid and Thalomid cases:
`
`Since the damages stemming from Celgene’s anticompetitive scheme harmed health
`
`benefit providers nationwide and generic manufacturers, cases have been brought against
`
`Celgene by dozens of companies in different fora. These lawsuits include:
`
`•
`
`In re Thalomid and Revlimid Antitrust Litig., No. 14-cv-06997 (D.N.J.), a class
`
`action on behalf of a purported class of end-payor plaintiffs before the
`
`Honorable Madeline Arleo (after initially being heard by the Honorable
`
`Katharine S. Hayden). On October 2, 2020, Judge Arleo granted final
`
`approved to a $34 million settlement. No. 14-cv-06997, ECF No. 325 (D.N.J.
`
`Oct. 2, 2020).6
`
`• Humana v. Celgene Corp., No. 19-cv-07532 (D.N.J.), before the Honorable
`
`Esther Salas, asserting antitrust claims similar to those at issue here.
`
`• United Healthcare Services, Inc. v. Celgene Corp., 2:20-cv-18531-WJM-MF (D.N.J.),
`
`before the Honorable William J. Martini, asserting claims similar to those at
`
`issue here.
`
`• Blue Cross and Blue Shield of Vermont, et al. v. Celgene Corp., et al., Case No.
`
`
`5 HCSC also asserts three additional state law claims (for fraud, negligent misrepresentation,
`and unjust enrichment) related to Celgene’s years-long fraudulent scheme to induce
`physicians to prescribe Thalomid and Revlimid “off-label,” i.e., for indications not approved
`by the FDA and for which these drugs are ineffective and unacceptably dangerous. Compl.
`¶¶ 473-538, 575-92. Defendants’ arguments for dismissal of those claims appear in their
`other motion to dismiss, and Plaintiffs respond to them there. See Plaintiffs’ Memorandum
`in Opposition to Motion to Dismiss under 12(b)(6), at 38-51.
`
`6 This settlement followed a previous $55 million proposed class settlement that Celgene
`rescinded after more than eighty absent class members (including Plaintiffs) excluded
`themselves from the settlement. Letter, In re Thalomid and Revlimid Antitrust Litig., No. 14-cv-
`06997, (D.N.J. Dec. 23, 2019), ECF No. 300.
`
`6
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 14 of 36
`
`
`
`200500496 (Ct. C.P. Phil. Cnty.), a group of seventy-nine third-party payer
`
`plaintiffs filed an action against the same Defendants in Pennsylvania state
`
`court.
`
`• Blue Cross and Blue Shield Association v. Celgene Corp., et al., No. 20-cv-01980
`
`(D.D.C.), before the Honorable Tanya S. Chutkan, asserting antitrust claims
`
`similar to those at issue here.
`
`• Mylan Pharmaceuticals, Inc. v. Celgene Corp., No. 14-2094 (D.N.J.), before the
`
`Honorable Esther Salas, alleging Celgene violated various antitrust laws in
`
`refusing to sell Revlimid and Thalomid samples to generic manufacturer
`
`Mylan. Celgene settled the case for $62 million in 2019. Id. ECF No. 425.
`
`The complained of conduct in this case constitutes only part of the
`
`monopolistic scheme alleged by Plaintiffs here.7
`
`I.
`
`ARGUMENT
`
`The Court must make a threshold ruling on its subject matter jurisdiction
`before it can determine whether it has the power to decide Defendants’
`other motions.
`
`A. Legal Standard
`
`Courts should address the “threshold” issue of subject matter jurisdiction prior to
`
`entertaining an inquiry into personal jurisdiction. Ruhrgas AG v. Marathon Oil Co., 526 U.S.
`
`
`7 Celgene has also filed a series of patent litigations—all alleged to be shams—in its home
`forum of the District of New Jersey. The Honorable Susan D. Wigenton presided or
`presides over Celgene Corp. v. Barr Laboratories, Inc., et al., No. 2:07-cv-286 (D.N.J.); Celgene
`Corp. v. Lannett Holdings, Inc., No. 2:15-cv-00697 (D.N.J.); Celgene Corp. v. Natco Pharma Ltd.,
`No. 2:10-cv-05197 (D.N.J.); Celgene Corp. v. Dr. Reddy’s Laboratories, Inc., Nos. 2:16-cv-07704,
`2:17-cv-05314, 2:18-cv-06378 (D.N.J.); Celgene Corp. v. Zydus Pharmaceuticals (USA) Inc., et al.,
`Nos. 2:17-cv-02528, 2:18-cv-08519 (D.N.J.); Celgene Corp. v. Cipla Ltd., Nos. 2:17-cv-06163,
`2:18-cv-08964, 2:19-cv-14731 (D.N.J.); Celgene Corp. v. Lotus Pharmaceutical Co., Ltd., et al.,
`Nos. 2:17-cv-06842, 2:18-cv-11518 (D.N.J.); Celgene Corp. v. Sun Pharmaceutical Industries, Inc., et
`al., No. 2:18-cv-11630 (D.N.J.); Celgene Corp. v. Hetero Labs Ltd., et al., No. 2:18-cv-17463,
`2:19-cv-15449 (D.N.J.); Celgene Corp. v. Apotex Inc., No. 2:18-cv-00461 (D.N.J.).
`
`7
`
`
`

`

`CASE 0:20-cv-02071-SRN-ECW Doc. 54 Filed 01/06/21 Page 15 of 36
`
`
`
`574, 578 (1999) (explaining that, generally, a federal court addresses subject-matter
`
`jurisdiction questions before personal jurisdiction questions). This is so because it is
`
`presumed that a case lies outside of a federal court’s limited jurisdiction. Dakota, Minnesota
`
`& Eastern R.R. Corp. v. Schieffer, 715 F.3d 712, 712 (8th Cir. 2013). A court “shall remand”
`
`the case “[i]f at any time before final judgment it appears that the district court lacks subject
`
`matter jurisdiction.” See Tenenbaum v. Bialick, No. 19-cv-0212, 2019 WL 3822311 at *2 (D.
`
`Minn. Aug. 15, 2019) (quoting 28 U.S.C. § 1447(c) (emphasis added)); see also Cantor
`
`Fitzgerald, L.P. v. Peaslee, 88 F.3d 152, 155 (2d Cir. 1996) (“Customarily, a federal court first
`
`resolves any doubts about its jurisdiction over the subject matter of a case before reaching
`
`the merits or otherwise disposing of the case.”).
`
`B. Before deciding any other motions, the Court should first determine that it
`has subject matter jurisdiction.
`
`Since “jurisdiction [should ] be established as a threshold matter,” Steel Co., 523 U.S.
`
`at 94-95 (1998) (citation omitted), the Court should first determine whether it has proper
`
`jurisdiction before delving into other motions. District courts routinely determine subject
`
`matter jurisdiction prior to evaluating the merits of a motion to dismiss for lack of personal
`
`jurisdiction, and there is no reason for the Court to deviate from this standard practice here.
`
`See, e.g., Tenenbaum, 2019 WL 3822311 at *2 (remanding case and declining to address the
`
`merits of defendants’ motion to dismiss for lack of personal jurisdiction); Magdalena v. Toyota
`
`Motor Corporation, No. 12-cv-20661, 2013 WL 12092086, at *5 (S.D. Fla. July 10, 2013)
`
`(“courts have found that where, as here, a claim of