Ruggeri v. Boehringer Ingelheim Pharmaceuticals

• Decision Date: 13 November 2008
• Docket Number: Civil No. 3:06cv1985 (JBA).
• Citation: 585 F.Supp.2d 254
• Court: U.S. District Court — District of Connecticut
• Parties: Luann RUGGERI, Ricardo Jaramillo, and Prakash Naik on behalf of themselves and others similarly situated, Plaintiffs, v. BOEHRINGER INGELHEIM PHARMACEUTICALS, INC., Defendant.

585 F.Supp.2d 254

Luann RUGGERI, Ricardo Jaramillo, and Prakash Naik on behalf of themselves and others similarly situated, Plaintiffs, v. BOEHRINGER INGELHEIM PHARMACEUTICALS, INC., Defendant.

Civil No. 3:06cv1985 (JBA).

United States District Court, D. Connecticut.

November 13, 2008.

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Andrew W. Skolnick, Brian J. Wheelin, J. Daniel Sagarin, David A. Slossberg, Hurwitz Sagarin Slossberg & Knuff LLC, Milford, CT, Charles Joseph, Michael D. Palmer, Joseph & .Herzfeld LLP, New York, NY, Eric B. Kingsley, Kingsley & Kingsley APC, Encino, CA, Gregory N. Karasik, Ira Spiro, Spiro Moss Barness LLP, Los Angeles, CA, James M. Finberg, Altshuler Berzon LLP, John T. Mullan, Kenneth J. Sugarman, Rudy Exelrod & Zieff, LLP, San Francisco, CA, James P. Keenley, Todd F. Jackson, Lewis, Feinberg, Lee, Renaker & Jackson, P.C., Oakland, CA, for Plaintiffs.

AMENDED RULING ON PLAINTIFFS' MOTION FOR PARTIAL SUMMARY JUDGMENT [Doc. # 140] AND DEFENDANT'S MOTION FOR SUMMARY JUDGMENT [Doc. # 141]1¹

JANET BOND ARTERTON, District Judge.

Plaintiffs Luann Ruggeri, Richard Jaramillo and Prakash Naik (collectively "Plaintiffs") initiated this suit against Boehringer Ingelheim Pharmaceuticals, Incorporated ("Boehringer" or "Defendant"), their former employer, for relief from Defendant's alleged misclassification of them as "exempt" employees resulting in its failure to pay them overtime wages, in violation of the Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201 et seq., as well as Defendant's alleged violation of various state-law worker protection laws. The Court previously granted Defendant's motion to dismiss the state law claims and granted Plaintiffs' motion for conditional FLSA collective action certification [Doc. # 139]. The parties have now moved for summary judgment on Plaintiffs' FLSA claims. For the reasons set forth below, Plaintiffs' motion for partial summary judgment is granted, and Defendant's motion for summary judgment is denied.

I. Facts and Background

The undisputed record reveals the following facts: Plaintiffs Ruggeri, Jaramillo, and Naik are residents of, respectively, Florida, California, and Illinois. Boehringer is a Delaware corporation with its principal place of business in Connecticut. Plaintiffs are current and former employees of Boehringer who occupied positions titled "Sales Representative," "Professional Sales Representative," "Specialty Sales Representative," and "Senior Specialty Sales Representative." The Court will refer to these job positions, collectively, as pharmaceutical sales representative ("PSR").

Plaintiffs' job duty was, centrally, to visit physicians and pharmacies in an assigned geographical territory and present information about, and samples of, Boehringer pharmaceutical products. Plaintiffs did not choose the subjects or objects of their visits. Instead, Boehringer's Commercial Analytics Department assigned to PSRs specific drugs to promote to specific physicians. Plaintiff Ruggeri stated:

We were assigned specific drugs to promote to physicians. We were given directive as to what specifically they wanted us to say to the physicians, in what order they wanted us to say it, how many times they wanted us to say it to which specific physicians using pieces they provided.

(Ruggeri Dep. at 47:7-12.²) From data available to the Commercial Analytics Department but not to individual PSRs, Commercial Analytics generates "target planners," which are lists of physicians in each PSR's territory and the number of visits which the PSR is to pay to each physician. (See Conklin Dep. at 271:9-273:13.) Although PSRs have limited ability to swap the occasional office visit with a colleague who may have better rapport with a particular target, they cannot engage in wholesale swaps of targets. (Ruggeri Dep. at 103:23-104:6.) PSRs are not permitted to deviate, either upwards or downwards, from the number of visits specified by the target planner; if they do, they face discipline. (Id. at 110:10-17; Conklin Dep. at 266:20-25.)

PSRs may not decide not to call on a particular target; a PSR is excused from visiting a target on her target planner only if the target in question "were dead or had retired." (Ruggeri Dep. at 105:1-3.) Even where the target physician is unreceptive to PSRs' visits or entirely averse to prescribing the Boehringer product to be promoted, PSRs are not permitted to forgo visiting the physician. (Ruggeri Dep. at 195:10-13; Jaramillo Dep. at 132:3-15.) In limited circumstances—for example, in the instance of a physician who had newly moved into the territory or who did not practice but was seen as influential (Ruggeri Dep. at 105:11-14; Jaramillo Dep. at 131:20-132:15)—PSRs can suggest to the Commercial Analytics Department that a particular physician be added to the target planner, but the procedure for adding physicians to the target planner is "very difficult" (Ruggeri Dep. at 105:14). PSRs do not, and may not, determine the frequency with which doctors are called on; rather, they obtain such information from their target planner. (Id. at 109:20-110:1.)

In preparation for meeting with targets, PSRs are given a book which lists the drugs to be promoted to the physician and set forth "what the message [is] going to be for that drug, that [PSRs] were to consistently use those words verbatim to the physician." (Id. at 101:15-19.) PSRs may not alter this core message, which often consists of a short slogan or phrase. (Id. at 106:3-7.) Moreover, as Defendant explained at oral argument, pursuant to legal restrictions governing pharmaceutical marketing as well as Boehringer's own internal policy choices, statements PSRs make to targets must be within a range of permissible subjects approved by Boehringer: James Conklin, Boehringer's Executive Director of Human Resources for Prescription Medicines, testified that when describing the drugs being promoted, PSRs' statements "must be within the approved prescribing information and limited to approved claims" about the medication. (Conklin Dep. at 114:9-12 (internal quotation omitted).) Similarly, Boehringer forbids PSRs to compare the Boehringer products being promoted to competitors' products unless "specifically instructed to do so by the Home Office." (Pls.' Mem. Points & Auths. Supp. Mot. Part. Summ. J. ("Pls.' Pts. & Auths.") [Doc. # 145], Ex. 17 at D05790.) It also bars PSRs from discussing the retail price or off-label uses of the promoted drug. (Conklin Dep. at 117:4-14; Pls.' Pts. & Auths. Ex. 21 at D04039.) To assist in their presentations during target visits, PSRs are given Boehringer-approved literature and visual materials. PSRs are not permitted to substitute materials or to distribute any materials which have not been approved beforehand by Boehringer (Conklin Dep. at 60:3-22), and PSRs may not alter materials by "laminating, highlighting, or underlining" them (Pls.' Pts. & Auths. Ex. 17 at D05788). PSRs may periodically arrange for a speaker to address a physician or group of physicians, but the speaker must be selected from Boehringer's pre-approved list. (Pls.' Pts. & Auths. Ex. 21 at D04040.) PSRs may suggest particular speakers to be added to the roster of approved speakers. (Ruggeri Dep. at 125:21-24.)

When distributing samples of Boehringer products, PSRs are required to track carefully their sample inventory and record the number of samples given to each target. (Pls.' Pts. & Auths. Ex. 18 at D25132.) PSRs must distribute samples "on a minimum of 55%" of target visits (id.), and Boehringer frequently provides PSRs with instructions as to the quantity and frequency with which to distribute samples to a particular target (Ruggeri Dep. at 118:22-119:2). PSRs are not permitted to place any stickers or labels on samples left with a physician. (Pls.' Pts. &amp Auths. Ex. 21 at D04049.) Additionally, Defendant provides PSRs a budget with which to take targets out to meals, but the meal is limited to "medical providers" and "must include a full product presentation." (Ruggeri Dep. at 116:3-8.)

Plaintiffs exercised discretion in various ways. Ms. Ruggeri used Boehringer-provided data to "[f]ormulate an idea of how to present" information on Boehringerproducts to particular physicians. (Id. at 139:8-12.) Ms. Ruggeri testified that PSRs concluded, from Boehringer-provided data, which Boehringer-listed physicians in their areas presented the greatest possibility of an increase in prescriptions for Boehringer products, and sometimes (but "[n]ot always") used their conclusions to choose who to entertain over a meal. (Id. at 117:6-25.) Mr. Jaramillo determined what physical route through a given geographic area he would take, subject to supervision that ensured the route was relatively efficient. (Jaramillo Dep. at 120:6-15.) He also decided when he would to stop into retail pharmacies (id. at 236:6-24), though as a general matter PSRs were "required" to make pharmacy visits (id. at 237:3-8). And he sometimes decided to visit physicians not on his target planner "if there was a need" such as "a new doctor's office" or when a younger doctor "eventually open [ed] their own practice" and Defendant's physician-tracking system had not yet accounted for the change. (Id. at 132:24-133:17). When Mr. Naik met with physicians, he would determine, based on the physician's demeanor and history of using Boehringer products, how "pushy" to be in his presentations. (Naik Dep. at 33:3-10.)

Notably, PSRs' visits to physicians do not culminate in physicians entering into contracts to write a particular number of prescriptions, as PSRs are forbidden by Boehringer from negotiating such contracts. (Conklin Dep. at 26:21-27:3.) PSRs do not sell Boehringer's products in question directly to patients, as it is unlawful to dispense them without a physician's prescription. Nevertheless, PSRs are paid much like salespeople: PSRs receive a base salary plus incentive compensation. Boehringer bases...