Documente Academic
Documente Profesional
Documente Cultură
DISTRICT OF KANSAS
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 2 of 16
TABLE OF CONTENTS
Page
I. INTRODUCTION ...............................................................................................................1
-i-
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 3 of 16
TABLE OF AUTHORITIES
Page
CASES
In re Intel Corp.,
No. 4:17-mc-80159-KAW, 2018 U.S. Dist. LEXIS 30757
(N.D. Cal. Feb. 23, 2018)...........................................................................................................8
- ii -
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 4 of 16
Page
Linder v. Calero-Portocarrero,
251 F.3d 178 (D.C. Cir. 2001) ...................................................................................................5
- iii -
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 5 of 16
I. INTRODUCTION
On December 11, 2017, Class Plaintiffs (“Plaintiffs”) served Humana, Inc. (“Humana”) with
a Subpoena seeking the production of documents relevant to this action. 1 Thereafter, on December
22, 2017, Humana requested and the parties reached agreement on an extension of Humana’s
response and production dates “[a]s long as there is a commitment to begin producing responsive
materials by January 31.” ECF No. 282-5. Two months later, Humana still had yet to produce a
single document and ignored requests to identify a new production date. See, e.g., ECF Nos. 282-6,
282-12; see also 282-7. As a result, Plaintiffs were left with no other alternative but to file a motion
to compel. 2 ECF Nos. 282, 292. There was never any real dispute that the materials Humana
refused to produce were (and are) relevant and responsive. See, e.g., ECF No. 292 at 9; ECF No.
687 at 12. And in opposing the motion to compel, Humana argued that it should be allowed “up to
at least May 20, 2018, to investigate and substantially complete its production.” ECF No. 316 at 5.
On June 11, 2018, the Court granted Plaintiffs’ motion and, recognizing that Humana’s requested
May 20, 2018 completion date had already passed, granted Humana until July 2, 2018, to complete
Now, Humana moves this Court for an additional month-long extension in which to collect
and produce responsive documents, 3 and objects – for the first time – that certain responsive
communications and other deliberative materials are confidential and should be redacted. Humana
also argues that Plaintiffs should be ordered to pay Humana’s costs of compliance.
1
On February 9, 2018, Mylan also served Humana with a document subpoena. ECF No. 701-3.
2
Only after Plaintiffs filed their motion to compel did Humana begin to produce documents. On
March 1, 2018, Humana produced a total of 16 documents, and on March 7, 2018, Humana produced
one additional document.
3
In total, including the 31 additional documents produced on July 2, 2018, Humana has produced
only 48 documents totaling 188 pages.
-1-
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 6 of 16
II. ARGUMENT
Humana seeks an extension of the Court’s July 2, 2018 production deadline claiming that it is
“entitled to additional time to produce responsive email[s]” because “subsequent to the Court’s
Order, Humana has learned that Class Plaintiffs also demand that Humana search for and produce an
First, Humana’s claim that it was unaware that Plaintiffs seek communications is not
accurate. The production of responsive communications was addressed both during several meet
and confers as well as in the motion to compel briefing. 4 Indeed, according to Humana itself, it has
communications” for many months now. See, e.g., ECF No. 282-12 at 2 (On February 7, 2018,
following submission of responses and objections, Humana stated it “still did not know what
materials exist” “[c]oncerning deliberative materials and communications relating to the rebate
agreements.”). To be sure, Humana earlier told the Court that it could complete its production by
May 20, 2018, which the Court noted included the production of responsive communications. See,
4
For example, on January 22, 2018, the parties “discussed the production of rebate and formulary
agreements, and deliberative materials and communications concerning those agreements.” See
ECF No. 282-12 at 1; see also id. at 3 (Feb. 7, 2017 Letter: “After having the subpoena for nearly
two months, Humana claims to not know whether it possesses responsive materials concerning
productions related to government and regulatory investigations, formulary agreement and related
communications and materials, and communications and deliberative materials concerning . . .
rebate agreements.”); ECF No. 316 at 8 (Humana recognizing in its opposition brief that Plaintiffs
seek “Humana’s communications and deliberative materials, including the clinical materials from
Humana’s P&T Committee”); ECF No. 687 at 9 (rejecting “Humana’s assertion that Plaintiffs’
request for communications and deliberative materials are improper”). Unless otherwise noted,
citations are omitted and emphasis is added, here and throughout.
-2-
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 7 of 16
Second, Plaintiffs have sought to reach agreement on all outstanding issues, including
Humana’s request for an additional extension. See, e.g., ECF No. 755-4. Humana, however,
rejected any proposal that was bilateral in nature, insisting that Plaintiffs either abandon the request
for responsive communications or agree to a lengthy extension without a date by which it would
extension. To preserve existing deadlines, Plaintiffs do not oppose an extension of the already
lapsed Court-ordered deadline so long as Plaintiffs are permitted a sufficient time in which to
evaluate the production, resolve any deficiencies with Humana, and, if necessary, seek relief from
the Court. 6
On June 11, 2018, the Court ordered Humana to produce materials responsive to Request
Nos. 1 and 14, (ECF No. 687 at 9), which requests, among other materials, P&T Committee
documents relating to the “consideration and negotiation of Incentives from, Mylan (for the
Epipen®)” (ECF No. 282-2 at 17 (Req. No. 1)) and concerning Humana’s “decision or consideration
to include, place, or otherwise exclude any EAI Drug Device on any PBM, Medicaid, or other
5
It is already July 11, 2018, and coordinated discovery ends on October 31, 2018. Thus, in just
over 100 days, Plaintiffs must receive and process Humana’s production, review those documents
(along with the tens of thousands of other documents produced by the parties and other third parties),
resolve any deficiencies, and take Humana’s deposition. Time is clearly of the essence.
6
By failing to complete its production by the Court-ordered July 2, 2018 deadline, and waiting
until the deadline to seek an extension, Humana has, for all practical purposes, already granted itself
an extension. Notably, Humana initially asked for a four-month extension, seeking a deadline of
May 20, 2018, to “investigate and substantially complete” its production. ECF No. 316 at 5. Having
done nothing to “investigate and substantially complete” its production since it filed its March 2,
2018 opposition brief, (ECF No. 316), Humana complains that it needs more than two additional
months beyond its May 20, 2018 date in which to complete its production.
-3-
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 8 of 16
formulary” (id., at 19 (Req. No. 14)). 7 See ECF No. 292 at 6. Despite the settled relevance of these
materials, (see ECF No. 687 at 12), Humana persists in refusing to produce relevant materials,
insisting that it should be permitted to redact the P&T materials this Court ordered be produced by
July 2, 2018, and objecting for the first time that “disclosure would cause unnecessary harm to
First, Humana’s belated objection that P&T Committee materials should be redacted was not
raised in its objections or in opposing the motion to compel. See, e.g., ECF No. 316 at 7-8. As such,
Humana’s objections are waived. Amica Mut. Ins. Co. v. Whois Privacy Prot. Serv., No. 12-cv-
00262-REB-KLM, 2012 WL 1657728, at *3 (D. Colo. May 11, 2012) (“failure to object in writing
to a subpoena duces tecum within the time specified in this rule constitutes a waiver of objections”).
Second, confidentiality is not a valid basis for withholding otherwise discoverable documents
and information. See, e.g., ECF No. 695 at 4 (“Trade secrets and similar confidential information
are not afforded absolute privilege.”). See AKH Co. v. Univ. Underwriters Ins. Co., No. 13-2003-
JAR-KGG, 2017 U.S. Dist. LEXIS 187801, at *45-*46 (D. Kan. Nov. 14, 2017) (“It is well settled
that confidentiality does not act as a bar to discovery and is not grounds to withhold documents or
information from discovery.”). Since the terms of the Protective Order adequately protect all
7
As explained by Humana, its Pharmaceutical and Therapeutic (“P&T”) Committee is the group
within Humana that would possess responsive materials concerning or memorializing Humana’s
deliberative process and considerations concerning rebates and whether or not (and why) certain EAI
Drugs will be included or excluded from Humana’s formulary. ECF No. 292 at 6. In addition, the
P&T Committee members, as decision makers for Humana concerning EAI device formulary
placement, are each percipient witnesses in this action. The parties are entitled to know who these
persons are and to subpoena trial or deposition testimony if necessary.
8
Significantly, Humana’s confidentiality objections are not only untimely raised but are also
contrary to the company’s representation in its January 17, 2018 written objections and responses
that Humana would be producing such P&T Committee materials and designating them as “Highly
Confidential” under the terms of the Stipulated Protective Order. ECF No. 282-4, ¶17.
-4-
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 9 of 16
confidential information, (see ECF No. 556 at §§2, 4.1), Humana’s objections to producing the P&T
Committee materials “as they are kept in the ordinary course of business” should be overruled.
Under Rule 45, a non-party may be entitled to reimbursement for “significant expense
resulting from compliance” with a subpoena. Fed. R. Civ. P. 45(d)(2)(B)(ii). Thus, the court must
first determine what expenses resulted from compliance, and then whether those expenses are
significant. See Legal Voice v. Stormans Inc., 738 F.3d 1178, 1184-85 (9th Cir. 2013); Linder v.
Calero-Portocarrero, 251 F.3d 178, 182 (D.C. Cir. 2001). What constitutes a “significant” expense
is dependent upon the facts and circumstances of each particular case. Some courts have considered
the following factors: (1) whether the non-party has an interest in the outcome of the underlying
litigation; (2) whether the non-party can more readily bear its costs than the requesting party; and (3)
whether the underlying litigation is of public importance. See In re Michael Wilson & Partners,
Ltd., No. 06-cv-02575-MSK-KMT, 2012 U.S. Dist. LEXIS 72961, at *9 (D. Colo. May 24, 2012).
Despite the required protection from significant expense, “a non-party can be required to bear some
or all of its expenses where the equities of a particular case demand it.” In re Honeywell Int’l, Inc.
Sec. Litig., 230 F.R.D. 293, 303 (S.D.N.Y. 2003); In re Seroquel Prods. Liab. Litig., No. 6:06-md-
1769-Orl-22DAB, 2007 WL 4287676, at *2 (M.D. Fla. 2007). Indeed, while Rule 45 protects
nonparties from significant expense resulting from compliance with a subpoena; it “does not cut a
blank check to nonparties.” United States v. McGraw-Hill Cos., Inc., 302 F.R.D. 532, 536 (C.D.
Cal. 2014). The facts and circumstances of this case do not support shifting Humana’s claimed
costs. 9
9
Humana’s request is, at best, premature. McGraw-Hill, 302 F.R.D. at 537 (deferring
consideration of a request for cost-shifting until “after documents have been produced and a
meaningful record [regarding costs] has been established”).
-5-
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 10 of 16
expense in complying with a subpoena in a case for which they have no interest. Sun Capital
Partners, Inc. v. Twin City Fire Ins. Co., No. 12-CIV-81397, 2016 WL 1658765, at *7 (S.D. Fla.
Apr. 26, 2016). As to this first factor, “‘when a party from whom documents are sought is not a
“classic disinterested non-party,” . . . the court can order that the non-party produce the documents at
its own expense.’” Id; see also In re Mushroom Direct Purchaser Antitrust Litig., No. 06-0638,
2012 U.S. Dist. LEXIS 12319, at *45-*46 (E.D. Pa. Jan. 31, 2012) (noting that “‘[w]hen a party
from whom documents are sought is not a “classic disinterested non-party,” . . . the court can order
that the non-party produce the documents at its own expense’”); Honeywell, 230 F.R.D. at 303
(denying non-party PWC’s request for reimbursement of gathering, copying, and review costs
Here, while Humana claims it is “a non-party with no stake in this litigation,” (see ECF No.
754 at 10), this is simply not the case. First, Humana provides health care and pharmaceutical
benefits to its medical membership of over 14 million members. Should Plaintiffs prevail in this
litigation, Humana – so long as Humana remains in the class and does not opt-out to pursue its own
claims – will likely be entitled to share in any recovery. And not dissimilar to the litigation being
pursued here, Humana itself also pursues litigation against drugmakers for violations of antitrust and
consumer protection laws. For example, Humana as an individual plaintiff in multidistrict litigation
pending in the District of Connecticut recently reached a confidential settlement with Teva
Pharmaceutical and Boehringer Ingelheim relating to Humana’s claims that the drugmakers blocked
generic alternatives to the stroke-prevention drug Aggrenox from coming to the market. In re
Aggrenox Antitrust Litig., No. 3:14-md-02516 (D. Conn.). As such, while Humana may not be a
-6-
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 11 of 16
named party in this litigation, it certainly has a significant interest in the outcome of this litigation.
Behrend v. Comcast Corp., 248 F.R.D. 84, 85-87 (D. Mass. 2008).
Second, Humana has a direct business interest in the underlying claims in this litigation. In
fact, Humana has warned its investors of the risk that “[i]f we do not continue to earn and retain
purchase discounts and volume rebates from pharmaceutical manufacturers at current levels, our
gross margins may decline.” Ex. 1 at 30 (“We have contractual relationships with pharmaceutical
manufacturers or wholesalers that provide us with purchase discounts and volume rebates on certain
was $1.2 billion at December 31, 2017 and $889 million at December 31, 2016.” Id. at 92. Because
Humana is not a classic disinterested non-party and has a significant interest in the outcome of this
litigation, the Court should deny Humana’s request for cost-shifting and order it to produce the
In assessing whether costs are “significant” courts also consider whether the non-party can
more readily bear its costs than the requesting party. Michael Wilson, 2012 U.S. Dist. LEXIS 72961,
at *12. The determination of whether costs are significant is relative, “such that ‘an expense might
be “significant,” for instance, to a small family-run business, while being “insignificant” to a global
10
Compare with, e.g., ECF No. 60, ¶636 (“the success or failure of certain drugs in the
marketplace” is determined “by offering to include or threatening to exclude certain medications
from some or all of their formularies and, in the process, extracting hundreds of millions of dollars in
the form of ‘discounts’ or ‘rebate’ payments from drug manufacturers in exchange”); id., ¶637
(“Negotiations between PBMs and drug manufacturers regarding those discounts, however, take
place in complex, closed-door meetings, during which PBMs sell access to their formularies in
exchange for large rebates or discounts, a substantial portion of which they pocket as pure profit.”).
-7-
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 12 of 16
financial institution.’” In re Intel Corp., No. 4:17-mc-80159-KAW, 2018 U.S. Dist. LEXIS 30757,
at *16-*17 (N.D. Cal. Feb. 23, 2018). Thus, “courts look to the nonparty’s financial ability to bear
the costs of production.’” Id.; see also Michael Wilson, 2012 U.S. Dist. LEXIS 72961, at *12 (“As
the party seeking to shift attorney’s fees and costs incurred, it is up to the Respondents to
demonstrate that they cannot more readily bear the expense than MWP.”).
exceeding $53 billion, Humana is ranked 56th on the Fortune 500. 11 It defies credulity to think that
the cost of compliance with Plaintiffs’ Subpoena is “significant” to a company of Humana’s size.
Intel, 2018 U.S. Dist. LEXIS 30757, at *16-*17. By contrast, Plaintiffs are a collection of individual
consumers and one regional Taft-Hartley welfare trust fund represented by law firms who have taken
on this case on a fully-contingent basis. Id. What would be significant for Plaintiffs here is likely
insignificant to Humana, one of the world’s largest corporations. Humana can and should bear its
own costs.
To determine whether costs are “significant” courts also consider whether the litigation is of
public importance. Callwave Commc’ns. v. Wavemarket, Inc., No. C 14-80112 JWS (LB), 2014 WL
2918218, at *3 (N.D. Cal. June 26, 2014). As the Court is aware, this lawsuit has significant public
importance. Indeed, the U.S. Congress called Heather Bresch, Mylan’s CEO, to appear before it and
provided testimony on issues including the pricing of EpiPen and the payment of rebates and other
“allowances.” ECF No. 60, ¶194. McGraw-Hill, 2014 WL 3810328 at *4 n.1 (finding third party
should bear a portion of the costs in a case regarding the role of credit rating manipulation in the
2007 crash because “this is a case of notable public importance, inquiring into who is to blame for a
11
See Fortune, http://fortune.com/fortune500/humana/ (last accessed July 11, 2018).
-8-
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 13 of 16
financial crisis that wreaked terrible havoc”). This is an additional reason the Court should find
The underlying litigation is also a matter of real concern to those who, like Humana, provide
prescription benefits to their medical members. If Mylan is found in violation of the Sherman Act or
state consumer protection laws, then those who purchased or otherwise paid for EpiPen – including
Humana – have been forced to pay higher prices for EpiPen due to defendants’ unlawful behavior.
Humana’s refusals to produce responsive documents until after Plaintiffs were forced to file a
motion to compel, and now again following a Court Order compelling Humana to do so, militates
squarely against any cost-shifting in Humana’s favor. W. Convenience Stores, Inc. v. Suncor Energy
U.S.A., Inc., No. 11-cv-01611-MSK-CBS, 2014 WL 1257762, at *26 (D. Colo. Mar. 27, 2014) (Rule
45 “should not be construed or applied in a way that ignores the subpoena recipient’s own conduct or
confers ‘a right to obfuscation or obstinacy.’”). As this Court recognized, Plaintiffs have taken
reasonable steps to avoid imposing undue burden or expense on Humana. See ECF No. 687 at 12.
Plaintiffs’ reasonableness has been rewarded, however, with Humana’s obstinate refusals to produce
responsive materials. For this additional albeit highly important reason, cost-shifting is not
appropriate here.
In addition to failing to substantiate its claim that any costs are “substantial,” Humana has
also failed to establish that the costs “‘resulted from compliance’” with Plaintiffs’ Subpoena.
McGraw-Hill, 302 F.R.D. 532, 537 (citing Legal Voice, 738 F.3d at 1184). Rather, all of the
documents that have or will be produced are a subset of the materials required to be produced in
response to Mylan’s subpoena as well. See ECF No. 701-3 at 6. Indeed, Mylan’s Request No. 1
-9-
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 14 of 16
seeks “[a]ll documents responsive to all Requests included in Schedule A to the subpoena directed
to” Humana by Plaintiffs. Id. 12 Mylan’s subpoena then seeks documents responsive to another ten
requests. Id. As such, Humana’s production is the result of subpoenas from both parties and it will
be manifestly “unfair to require plaintiffs to bear these costs alone.” Spears v. First Am.
eAppraiseIT, No. 5:08-cv-00868-RMW, 2014 WL 6901808, at *4-*5 (N.D. Cal. Dec. 8, 2014).
While Humana does not attempt to allocate between Mylan’s Request No. 1 and Plaintiffs’
subpoenas (nor could it), to the extent any costs are shifted they should be allocated between Mylan
and Plaintiffs.
III. CONCLUSION
Only a very short extension should be granted to Humana to produce responsive documents
and Humana should not be entitled to redact the important P&T Committee materials. In addition,
Humana has not and will not be exposed to “significant expense resulting from compliance” with the
Court’s order compelling it to produce responsive and relevant documents. All parties should bear
s/ BRIAN O. O’MARA
BRIAN O. O’MARA
12
Mylan’s request reads: “All documents responsive to all Requests included in Schedule A to the
subpoena directed to you, issued on December 8, 2017 by counsel for Consumer Class Cases
Plaintiffs in this case, captioned In Re: EpiPen (Epinephrine Injection, USP) Marketing, Sales
Practices and Antitrust Litigation, Civil Action No. 17-md-2785-DDC-TJJ.” Id.
- 10 -
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 15 of 16
- 11 -
1451304_1
Case 2:17-md-02785-DDC-TJJ Document 783 Filed 07/11/18 Page 16 of 16
CERTIFICATE OF SERVICE
I hereby certify under penalty of perjury that on July 11, 2018, I authorized the electronic
filing of the foregoing with the Clerk of the Court using the CM/ECF system which will send
notification of such filing to the e-mail addresses on the attached Electronic Mail Notice List, and I
hereby certify that I caused the mailing of the foregoing via the United States Postal Service to the
s/ BRIAN O. O’MARA
BRIAN O. O’MARA
E-mail: bomara@rgrdlaw.com
1451304_1