Fagan v. Amerisourcebergen Corp.

Citation356 F.Supp.2d 198
Decision Date29 July 2004
Docket NumberNo. CV-03-3787 SJF WDW.,CV-03-3787 SJF WDW.
PartiesTimothy FAGAN, Plaintiff, v. AMERISOURCEBERGEN CORP., Amgen Inc., CVS Corporation, ProCare Pharmacy, Inc. and "John Doe Corporations 1-100" (fictitious names for Corporations who manufactured, distributed, or sold the drugs that are the subject of this suit and the containers the drugs were packaged and/or shipped in), Defendants.
CourtU.S. District Court — Eastern District of New York

Eric Turkewitz, The Turkewitz Law Office, New York, NY, for Plaintiff.

Debra O'Gorman, Dechert LLP, Loretta E. Lynch, Hogan & Hartson L.L.P., New York, NY, Mark D. Gately, Hogan & Hartson L.L.P., Baltimore, MD, Michael L. Kidney, Hogan & Hartson L.L.P., Washington, DC, Robert Ortiz, McAndrew, Conboy & Prisco, Woodbury, NY, for Defendants.

OPINION & ORDER

FEUERSTEIN, District Judge.

Timothy Fagan (plaintiff) commenced this diversity action against defendants AmerisourceBergen Corp. (ABC), Amgen Inc. (Amgen), CVS Corporation (CVS), ProCare Pharmacy, Inc. (ProCare), and "John Doe Corporations 1-100", (collectively, defendants) to recover damages for personal injuries, alleging claims for negligence, breach of the implied warranties of merchantability and fitness for a particular purpose, breach of an express warranty, negligent misrepresentation, and fraudulent concealment.

Amgen and ABC have moved for dismissal of the complaint pursuant to Fed.R.Civ.P. 12(b)(6), and CVS and ProCare (collectively, CVS ProCare) have moved for judgment on the pleadings pursuant to Fed.R.Civ.P. 12(c). In addition, ABC has moved pursuant to Fed.R.Civ.P. 12(b)(6) for dismissal of the cross claims asserted by CVS ProCare against it. For the reasons set forth herein, Amgen's motion is granted and the complaint is dismissed in its entirety as against Amgen; the motions of ABC and CVS ProCare are granted in part and denied in part; and plaintiff is granted leave to amend the complaint to replead the breach of an express warranty claim as against CVS ProCare.

I. BACKGROUND
A. Factual Background1
1. The Parties

Plaintiff is an 18 year old male who resides in Suffolk County.

Amgen is a Delaware corporation with its principal place of business in California. Amgen manufactures the prescription drug Epogen.

ABC is a Delaware corporation with its principal place of business in Pennsylvania. ABC is a wholesale distributor of pharmaceuticals, including Epogen. According to plaintiff, ABC was an "authorized distributor" of Amgen, but also bought Epogen and other medications from secondary sources constituting a "gray market."

CVS is a Delaware corporation with its principal place of business in Rhode Island. ProCare is a Rhode Island corporation with its principal place of business in Rhode Island, and is a subsidiary of CVS. CVS ProCare, inter alia, sells and delivers prescription drugs to consumers via mail.

"John Doe Corporations 1-100" are fictitious names for corporations which manufactured, distributed, or sold Epogen and the containers in which the drug was packaged and/or shipped.

2. Factual Allegations

Following a liver transplant on February 15, 2002, plaintiff's doctor prescribed Epogen, at a dosage of 40,000 units per milliliter, to be injected once a week. According to plaintiff, CVS ProCare purchased Epogen from ABC, then sold and delivered it to him via mail on or about March 20, 2002. Plaintiff further alleges that in mid-April 2002, he received a second shipment of Epogen from CVS ProCare, labeled "Lot # P0010191 (Exp. 9/02)."

Plaintiff alleges that Amgen posted a letter dated May 8, 2002 on its website advising that there was counterfeit Epogen in the marketplace, bearing Lot # P002970. Amgen further advised that the counterfeit lot could be determined by examining the vial label, which omitted the degree sign from the temperature at which the drug should be stored. In addition, Amgen advised that although the counterfeit drug contained the active ingredient, the dosage was one-twentieth (1/20th) the strength set forth on the label.

Plaintiff alleges that on or about May 14, 2002, CVS ProCare called him to inform him that there was counterfeit Epogen in the marketplace. According to plaintiff, on or about May 15, 2002, CVS ProCare delivered to him a third shipment of Epogen, labeled "Lot # P002970 (exp. 7/03)," which was the lot designated as counterfeit on the Amgen website.

Plaintiff alleges that on or about May 20, 2002, he discovered that the second shipment of Epogen that he received from CVS ProCare, labeled "Lot # P001091," also omitted a degree symbol from the storage temperature on the label. On or about May 24, 2002, Amgen identified Lot # P0001091 as also being counterfeit.

Plaintiff alleges that the weekly injections of the counterfeit Epogen continued for two months and that, as a result, inter alia, he suffered from continued anemia and excruciating side effects, and his recovery from the liver transplant was delayed.

B. Procedural Background

On or about August 4, 2003, plaintiff commenced this diversity action against defendants to recover damages for personal injuries he allegedly sustained as a result of the weekly injections of the counterfeit Epogen for two months. Plaintiff asserts causes of action seeking damages for negligence, breach of the implied warranties of merchantability and fitness for a particular purpose, breach of an express warranty, fraudulent misrepresentation, and fraudulent concealment. In addition, plaintiff seeks punitive damages.

Amgen and ABC have separately moved pursuant to Fed.R.Civ.P. 12(b)(6) to dismiss plaintiff's complaint against them for failure to state a claim; and ABC further moves to dismiss the cross claims asserted against it by CVS ProCare. CVS ProCare moves pursuant to Fed.R.Civ.P. 12(c) for judgment on the pleadings.

II. DISCUSSION
A. Standard of Review
1. Fed.R.Civ.P. 12(b)(6)

A motion to dismiss for failure to state a claim under Fed.R.Civ.P. 12(b)(6) should be granted only where "it appears beyond a doubt that plaintiff can prove no set of facts in support of his claim that would entitle him to relief." Levitt v. Bear Stearns & Co., 340 F.3d 94, 101 (2d Cir.2003) (internal quotations and citations omitted). In deciding a motion to dismiss, the Court must liberally construe the claims, accept all factual allegations in the complaint as true, and draw all reasonable inferences in favor of the plaintiff. See, Cargo Partner AG v. Albatrans, Inc., 352 F.3d 41, 44 (2d Cir.2003); New v. Ashcroft, 293 F.Supp.2d 256, 257 (E.D.N.Y.2003). The court's task "is merely to assess the legal feasability of the complaint, not to assay the weight of the evidence which might be offered in support thereof." Levitt, 340 F.3d at 101 (internal quotations and citations omitted). The issue is not whether a plaintiff will ultimately prevail but whether he or she is entitled to offer evidence to support the claims. See, New, 293 F.Supp.2d at 257 (citing Villager Pond, Inc. v. Town of Darien, 56 F.3d 375, 378 [2d Cir.1995]).

2. Fed.R.Civ.P. 12(c)

The standard of review on a motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(6) is the same standard applied to a motion for judgment on the pleadings pursuant to Fed.R.Civ.P. 12(c). See, Ziemba v. Wezner, 366 F.3d 161, 163 (2004); Oneida Indian Nation of New York v. City of Sherrill, New York, 337 F.3d 139, 152 (2003).

B. Negligence
1. Amgen

Amgen contends, inter alia, that it cannot be held liable for injuries sustained as a result of changes made to its product after the product left its control, and that it did not have a duty (1) to makes its product tamper-proof; (2) to continuously monitor its products from the time they leave its control until the time they are purchased by the consumer; or (3) to protect the public from the criminal misuse of its products, even if such use was foreseeable.

Plaintiff contends, inter alia, that Amgen owed him a duty of care because (1) he had a reasonable expectation that the manufacturer of Epogen would owe him a duty of care; (2) holding manufacturers of prescription drugs liable for failing to adequately safeguard their products will not result in an unreasonable proliferation of claims, as liability would be limited to those consumers who suffered a personal injury as a result of consuming a defective drug; (3) there is no likelihood that manufacturers of prescription drugs will be held to unlimited liability merely because they owe a duty of care to consumers of their drugs; (4) as a manufacturer of prescription drugs, Amgen is in a better position to protect against the risk of harm to users of the drugs by packaging them in tamper-resistant materials and warning those in the distribution chain to be on the alert for altered or tampered products and the dangers of the "gray market;" and (5) holding Amgen liable would not create a new "channel" of liability, since a manufacturer has a duty to take reasonable steps to make tampering with its product more difficult.

In order to prevail on a negligence claim under New York law, a plaintiff must establish (1) that the defendant owed him or her a duty of care; (2) that the defendant breached that duty; and (3) that the defendant's breach was the proximate cause of the plaintiff's injuries. See, Johnson v. Bryco Arms, 304 F.Supp.2d 383, 394 (E.D.N.Y.2004)(citing Akins v. Glens Falls City Sch. Dist., 53 N.Y.2d 325, 333, 441 N.Y.S.2d 644, 424 N.E.2d 531 [1981]). In New York, the existence of a duty of care is a "legal, policy-laden declaration reserved for judges." In re September 11 Litigation, 280 F.Supp.2d 279, 290 (S.D.N.Y.2003)(citing Palka v. Servicemaster Mgmt. Servs. Corp., 83 N.Y.2d 579, 611 N.Y.S.2d 817, 634 N.E.2d 189 [1994]). The plaintiff must establish not only that a defendant owed a general duty of care to society as a whole, but also that the defendant owed a specific duty...

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