Mission Specialty Pharmacy, LLC v. OptumRx, Inc.
| Decision Date | 30 December 2015 |
| Docket Number | NO. SA-15-CV-885-DAE,SA-15-CV-885-DAE |
| Citation | 154 F.Supp.3d 453 |
| Parties | Mission Specialty Pharmacy, LLC, Plaintiff, v. OptumRx, Inc., Defendant. |
| Court | U.S. District Court — Western District of Texas |
Micah E. Skidmore, Natalie Dubose, Haynes and Boone, L.L.P., Dallas, TX, for Plaintiff.
Joann Dalrymple, Jackson Walker L.L.P., Austin, TX, Matthew Eric Vandenberg, Stephen R. Fogle, Jackson Walker, L.L.P., San Antonio, TX, for Defendant.
David Alan Ezra
On December 11, 2015, the Court heard oral argument on Mission Specialty Pharmacy's (“Mission Pharmacy” or “Plaintiff”) Motion for Preliminary Injunction. (Dkt. # 8.) Micah Skidmore, Esq., appeared on behalf of Plaintiff; JoAnn Dalrymple, Esq., appeared on behalf of Defendant OptumRx, Inc. (“OptumRx” or “Defendant”). After careful consideration of the memoranda in support of and in opposition to the motion, and in light of the parties' arguments at the hearing, the Court, for the reasons that follow, DENIES Plaintiff's Motion for Preliminary Injunction. (Dkt. # 8).
Mission Pharmacy is an independent retail pharmacy in San Antonio which provides both conventional and compounded prescription medications to patients. (“Am. Compl.,” Dkt. # 25 ¶ 9; Dkt. # 8 ¶¶ 1-2.) According to Mission Pharmacy, compounded pharmaceuticals are different from conventional prescription medications because they can be customized to meet specific patients' needs. Mission Pharmacy currently offers walk-in prescription services to patients, but also ships compounded medication to patients via Federal Express. Mission Pharmacy states that it complies with applicable licensing requirements in each state where it ships covered prescriptions. (Id. ¶ 17.)
OptumRx is a pharmacy benefit manager. (Am. Compl. ¶ 11; Dkt. # 15 at 2.) On August 29, 2012, OptumRx entered into a Pharmacy Network Agreement (the “Agreement”) with Morris & Dickson Co. LLC d/b/a Community Independent Pharmacy Network (“CIPN”). (Am. Compl. ¶ 12.) Mission Pharmacy joined the CIPN and became party to the Agreement on July 9, 2013. (Id .) The Agreement requires OptumRx to pay Mission Pharmacy for covered pharmaceuticals it dispenses to OptumRx patients. (Id. ¶ 13.)
The Agreement between OptumRx and CIPN, to which Mission Pharmacy became a party in 2013, contains the following provision:
No Mail Fulfillment or Solicitation . Company and Pharmacy shall not solicit a Member for mail delivery or deliver any Covered Prescription Services to a Member by mail, except upon the advance written approval of Administrator, which approval may be refused in Administrator's sole discretion.
The original Agreement did not define the word “mail.” (Am. Compl. ¶ 15.) The 2014 Pharmacy Manual also does not define the word “mail.” (Id. ¶ 18; Dkt. # 8, Ex. C-2.)
The Agreement also contains a provision incorporating the “rules, policies, administrative procedures and guidelines” located in OptumRx's Pharmacy Manual into the Agreement; this provision notifies Members that these rules “may change from time to time.” (Agreement § 3.15.) The Agreement also contains provisions describing the manner in which the contract or materials incorporated by reference may be modified. (Id. § 11.2.) One such method allows OptumRx to unilaterally amend the Agreement and incorporate material if it provides “thirty (30) days prior written notice to Company” before such change. (Id. at § 11.2(b).) The contract modification provision states that “[i]f Company does not object to such amendment in writing within such thirty (30) day notice period, Company and Pharmacy shall be deemed to have accepted the proposed amendment.” (Id. )
OptumRx claims that on December 1, 2014, it published notice via email that its 2015 Pharmacy Manual was available for viewing, and would become effective January 1, 2015. (Dkt. # 15, Ex. A-3.) Mission Pharmacy did not submit written objections to the changes in the Manual. (Dkt. # 8; Dkt. # 15.) The 2015 Pharmacy Manual defines “mail/mailing” as the “action or process of sending Covered Prescription Services through the US mail, shipping via any common carrier (e.g. FedEx, UPS, DHL) or via delivery by any type of courier to Members.” (Am. Compl. ¶ 18; Dkt. # 8, Ex. C-3 at 14.) Mission Pharmacy alleges that OptumRx did not obtain Mission Pharmacy's consent to add this definition of mail; further, Mission Pharmacy states that OptumRx did not provide any consideration for this change to the manual. (Am. Compl. ¶ 21.)
On June 2, 2015, OptumRx issued a letter to Mission Pharmacy and all other pharmacies contracting through CIPN explaining that OptumRx was terminating the Agreement with CIPN, and inviting Mission Pharmacy and other independent pharmacies “to contract directly with OptumRx.” Mission Pharmacy's Amended Complaint challenges the validity of the termination, and seeks a declaration that such termination “violates article 21.52B of the Texas Insurance Code
.
On August 31, 2015, OptumRx issued a Cease and Desist Letter (the “Letter”) demanding that Mission Pharmacy cease “mailing, shipping, and/or delivering” Covered Prescription Services to members.” The Letter requests that Mission Pharmacy submit written confirmation that it will cease shipping prescriptions, and states that failure to respond “could result in further disciplinary action, up to and including suspension of payment and termination” from the OptumRx Pharmacy Network. Mission Pharmacy continued to ship prescriptions. (Am. Compl. ¶ 24.) On September 14, 2015, Mission Pharmacy notified OptumRx via letter that OptumRx's “attempt to limit the shipment of Covered Prescription Services by Mission through a private carrier service is unenforceable.” (Dkt. # 8, Ex. C-6 at 2.) Further, Mission Pharmacy stated that it would not “agree to cease and desist delivery of Covered Prescription Services by third-party, non-governmental carriers,” arguing that such delivery “is not prohibited by the Agreement and is necessary to serve the needs of patients.” (Id. at 3.)
On October 22, 2015, OptumRx sent an e-mail to Mission Pharmacy stating that OptumRx would not “take any action to terminate Mission Pharmacy's status as a participating pharmacy ... on the basis of Mission Pharmacy's non-participation status or prohibition against mailing before the earlier of December 31, 2015 or when the court rules on the application for preliminary injunction.” (Dkt. # 8, Ex. D-2.)
On October 6, 2015, Mission Pharmacy filed suit in the 150th Judicial District Court of Bexar County, Texas seeking a Temporary Restraining Order (Dkt. # 1, Ex. A ¶¶ 32-46), as well as Temporary and Permanent Injunctions preventing OptumRx from terminating Mission Pharmacy from the pharmacy network for shipping prescriptions through the mail. (Id. ¶¶ 47-49.) On October 14, 2015, OptumRx removed the case to this Court on the basis of diversity. (Id. ) On November 2, 2015, Mission Pharmacy filed the instant Motion for Preliminary Injunction. (Dkt. # 8.) On December 10, 2015, Plaintiff filed an amended complaint adding a cause of action for specific performance, which mooted the instant Motion for Preliminary Injunction. (Dkt. # 25.) Nonetheless, the parties agreed to conduct the December 11, 2015 preliminary injunction hearing and remedy the procedural issue by filing supplemental responses to the Motion for Preliminary Injunction. (Dkt. # 27.) On December 17, 2015, OptumRx filed its Supplemental Response to Plaintiff's Motion for Preliminary Injunction. (Dkt. # 28.) Mission Pharmacy filed a Response on December 18, 2015. (Dkt. # 30.)
To obtain a preliminary injunction, a plaintiff must demonstrate:
(1) a substantial likelihood of success on the merits, (2) a substantial threat of irreparable injury if the injunction is not granted, (3) that the threatened injury if the injunction is denied outweighs any harm that will result if the injunction is granted, and (4) that the grant of an injunction will not disserve the public interest.
Janvey v. Alguire , 647 F.3d 585, 595 (5th Cir.2011)
; Byrum v. Landreth , 566 F.3d 442, 446 (5th Cir.2009). Injunctive relief “should only be granted when the movant has clearly carried the burden of persuasion” on all four requirements. Anderson v. Jackson , 556 F.3d 351, 360 (5th Cir.2009) (citing Holland Am. Ins. Co. v. Succession of Roy , 777 F.2d 992, 997 (5th Cir.1985) ); Dennis Melancon, Inc. v. City of New Orleans , 703 F.3d 262, 268 (5th Cir.2012). “A preliminary injunction is an extraordinary remedy never awarded as of right,” and “courts must balance the competing claims of injury and must consider the effect on each party of the granting or withholding of the requested relief.” Winter v. Natural Res. Def. Council, Inc. , 555 U.S. 7, 24, 129 S.Ct. 365, 172 L.Ed.2d 249 (2008) (quoting Amoco Prod. Co. v. Village of Gambell, AK , 480 U.S. 531, 542, 107 S.Ct. 1396, 94 L.Ed.2d 542 (1987) ).
This Court applies Texas choice-of-law rules in determining whether California or Texas law applies to the instant motion. Nat'l Union Fire Ins. Co. of Pitts., Pa. v. Am. Eurocopter Corp. , 692 F.3d 405, 408 (5th Cir.2012)
() (quoting Klaxon Co. v. Stentor Elec. Mfg. Co. , 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941) ; see also Benchmark Elec., Inc. v. J.M. Huber Corp. , 343 F.3d 719, 726 (5th Cir.2003). Where parties have contractually agreed to a choice-of-law provision, Texas choice-of-law rules favor enforcement of these provisions, unless the provision “violates a...
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