IMS Health Corp. v. Schneider, 1:07–cv–00127–JAW.

• Decision Date: 28 September 2012
• Docket Number: No. 1:07–cv–00127–JAW.,1:07–cv–00127–JAW.
• Citation: 901 F.Supp.2d 172
• Parties: IMS HEALTH CORP., et al., Plaintiffs, v. William J. SCHNEIDER, Attorney General of the State of Maine, Defendant.
• Court: U.S. District Court — District of Maine

901 F.Supp.2d 172

IMS HEALTH CORP., et al., Plaintiffs,

v.William J. SCHNEIDER, Attorney General of the State of Maine, Defendant.

No. 1:07–cv–00127–JAW.

United States District Court, D. Maine.

Sept. 28, 2012.

Jamie Zysk Isani, Thomas R. Julin, Hunton & Williams, LLP, Miami, FL, John H. Montgomery, Bernstein Shur Sawyer & Nelson, Portland, ME, Mark A. Ash, Law Office of Mark A. Ash, Raleigh, NC, for Plaintiffs.

Thomas A. Knowlton, Nancy M. Macirowski, Paul Stern, Thomas C. Bradley, Office of the Attorney General, Augusta, ME, Thomas C. Bradley, Stacy Canan, Bruce Vignery, AARP Foundation Litigation, Sean M. Fiil–Flynn, Washington College of Law, Washington, DC, James B. Haddow, Petruccelli, Martin & Haddow, Portland, ME, for Defendant.

ORDER ON MOTION FOR ATTORNEYS' FEES

JOHN A. WOODCOCK, JR., Chief Judge.

Following their First Amendment victory, the Plaintiffs filed a motion and supplemental motion, requesting that the Court order the state of Maine to pay them $1,307,252.15 in attorneys' fees, expenses, and costs. The Court awards $678,189.64 in fees and expenses.

I. INTRODUCTION

Under the law, the Plaintiffs in this case are clearly entitled to an award of attorneys' fees against the state of Maine. Congress enacted 42 U.S.C. § 1988 to ensure “effective access to the judicial process for persons with civil rights grievances.” Blanchard v. Bergeron, 489 U.S. 87, 95, 109 S.Ct. 939, 103 L.Ed.2d 67 (1989) (citation omitted). In this case, in 2007, the Maine Legislature enacted a statute that would have had a profound, potentially devastating impact on the Plaintiffs' businesses. In seeking to have the statute declared an unconstitutional infringement of their First Amendment right to free speech, the Plaintiffs were not merely fighting for their economic survival, they were also seeking more generally to vindicate the preeminence of the First Amendment over a legislative enactment. Through the determined efforts of their attorneys, the Plaintiffs attained a resounding victory, as the state of Maine capitulated in the face of a decision by the United States Supreme Court and agreed to allow this Court to enter a judgment that effectively voided the statute as unconstitutional.

Not that it was easy. The Plaintiffs staged this legal battle in three states, three federal district courts, two circuit courts of appeal, and took the fight all the way to the United States Supreme Court. The issues were sophisticated and the facts and the law were complicated. Nor was the outcome a forgone conclusion. On the way to resolution, federal judges arrived at markedly different conclusions about similar legal questions. The district courts in New Hampshire and Maine and the district court in Vermont came down on opposite sides, as did the First and Second Circuits. It took the First Circuit sixty-four pages (including a dissent) to rule on Ayotte, the New Hampshire companion case, and forty-two pages (including a concurrence) to resolve the appeal of this case. See IMS Health Inc. v. Ayotte, 550 F.3d 42 (1st Cir.2008); IMS Health Inc. v. Mills, 616 F.3d 7 (1st Cir.2010). Judges in the Second Circuit divided over the issue, with two judges ruling against the Vermont version of the statute and one dissenting in favor of its constitutionality. See IMS Health Inc. v. Sorrell, 630 F.3d 263 (2d Cir.2010). Finally, in ruling in the Plaintiffs' favor, the Supreme Court itself was divided, with six justices in the majority and three in dissent. See Sorrell v. IMS Health Inc., ––– U.S. ––––, 131 S.Ct. 2653, 180 L.Ed.2d 544 (2011).

Furthermore, throughout the lawsuit, the Plaintiffs faced an able and diligent foe in the Maine Attorney General's Office. In short, this was no run-of-the-mill matter and the Plaintiffs' counsel knew they had to present their very best case in order to prevail, not only because the legal issues were challenging and nuanced but also becausefailure threatened the very existence of their clients' businesses.

No doubt, the Plaintiffs themselves benefitted mightily from their victory. The Maine taxpayer may wonder why it should be that commercial businesses with the presumed wherewithal to pay their lawyers should be allowed to force the citizens of Maine to foot the bill. The brief answer is that the Plaintiffs won more than a commercial victory; they won a victory for the First Amendment, and Congress has allowed fee-shifting from private plaintiffs to the public in a limited number of cases where the vindication of a right, even though it confers a private advantage, is presumed to benefit the public at large. See Gay Officers Action League v. Puerto Rico, 247 F.3d 288, 295 (1st Cir.2001) (noting that the ruling in that case “clearly benefitted both the parties and the public as a whole”).

Finally, although the Maine Legislature had a perfect right to enact the Maine variation of the New Hampshire law, it did so in the shadow of an opinion from Judge Paul Barbadoro of the United States District Court for the District of New Hampshire, voiding as unconstitutional a similar New Hampshire law. Thus, the Maine Legislature enacted its variation with certain knowledge that the Plaintiffs would attack it in federal court in Maine just as they had successfully done in New Hampshire, and the Legislature thereby ran the risk that this day would come.

II. STATEMENT OF FACTSA. Case Background¹

Within this Country's Byzantine health care delivery system, there are many niche players. One is the prescription drug information intermediaries (PDIIs), companies that collect, aggregate, and analyze mountains of prescribing information from physicians and pharmacists, making the data useful to government agencies, academic institutions, health insurance companies, and others. “Others” includes the prescriptive medicine arm of the pharmaceutical industry, which must rely on health care providers to direct patients to its products. The pharmaceutical industry therefore has a keen economic interest in learning about the prescribing patterns of health care providers and in obtaining and using the data the PDIIs generate. That pharmaceutical companies have access to individual physicians' prescribing patterns comes as an unpleasant surprise to some physicians, who have a queasy sense that the availability of this data violates their privacy and, by extension, the privacy of their patients. In response to concerns from health care providers, state legislatures began to enact laws restricting the ability of PDIIs to collect, analyze and sell the information.

New Hampshire took the lead. In 2006, the New Hampshire Legislature enacted a statute that prohibited the transmission or use of patient-identifiable and prescriber-identifiable data for most commercial purposes. See IMS Health Inc. v. Ayotte, 550 F.3d at 45; 2006 N.H. Laws § 328, codified at N.H.Rev.Stat. Ann. §§ 318:47–f, 318:47–g, 318–B:12(IV).

Maine was next. In 2007, the Maine Legislature enacted An Act to Amend the Prescription Privacy Law (the Law), 2007 Me. Laws 460 (codified as amended at 22 M.R.S. §§ 1711–E, 8704, 8713), which was to become effective on January 1, 2008. In brief, the Law allowed Maine prescribers of prescriptive medicine to opt out of providing their prescribing information to the PDIIs. Later in 2007, the state of Vermont followed suit with its own version, adopting an opt-in approach. See Vt. Acts No. 80, § 17 (2007) (codified at Vt. Stat. Ann.. tit. 18, § 4631(a)).

Perceiving a direct threat to their business, the PDIIs resorted to litigation to block the laws, claiming that the laws unconstitutionally violated their right to free commercial speech. Again, New Hampshire was first. Two PDIIs filed suit in the United States District Court for the District of New Hampshire and on April 30, 2007, Judge Paul Barbadoro issued an extensive opinion, concluding that the New Hampshire law violated the First Amendment and granting the PDIIs' request for declaratory judgment and a permanent injunction. See IMS Health Inc. v. Ayotte, 490 F.Supp.2d 163 (D.N.H.2007). The New Hampshire Attorney General appealed to the Court of Appeals for the First Circuit.

Meanwhile, in Maine, on August 29, 2007, three PDIIs filed a complaint in this Court and moved, the next day, for a preliminary injunction against enforcement of the law, claiming that it violated the First Amendment. See IMS Health Corp. v. Rowe, 1:07–cv–00127–JAW, Compl. (ECF No. 1); Pls.' Mot. for Prelim. Inj. (ECF No. 5). After a two-day evidentiary hearing and extensive briefing, this Court issued an order on December 21, 2007, granting the PDIIs' motion for preliminary injunction. See IMS Health Corp. v. Rowe, 532 F.Supp.2d 153 (D.Me.2007), amended by IMS Health Corp. v. Rowe, 532 F.Supp.2d 153 (D.Me.2008). The Maine Attorney General appealed to the First Circuit, but its appeal was stayed pending resolution of the New Hampshire appeal.

On November 18, 2008, the First Circuit reversed the New Hampshire district court and vacated its injunction. See IMS Health Inc. v. Ayotte, 550 F.3d 42 (1st Cir.2008). On August 4, 2010, the First Circuit reversed this Court's judgment and remanded the case with instructions to dismiss it with prejudice. IMS Health Inc. v. Mills, 616 F.3d 7 (1st Cir.2010).² In accordance with the First Circuit's ruling, this Court issued an Order of Dismissal on Remand and an Amended Judgment of Dismissal on October 13, 2010. Order of Dismissal on Remand (ECF No. 99); Am. J. of Dismissal (ECF No. 101).

As the Maine and New Hampshire cases were being resolved in the First Circuit, the Vermont case proceeded. On April 23, 2009, Judge Garvan Murtha of the United States District Court for the District of Vermont issued an order denying the Plaintiffs' motions for declaratory relief, injunctive relief, and summary judgment. IMS Health Inc. v. Sorrell, 631 F.Supp.2d 434, 464 (D.Vt.2009). The PDIIs appealed this decision to the Court of Appeals for the Second Circuit. The Second...