United States ex rel. Piacentile v. Amgen Inc.
| Decision Date | 23 November 2021 |
| Docket Number | 04-CV-3983 (SJ)(RML) |
| Parties | UNITED STATES OF AMERICA, et al, ex rel JOSEPH PIACENTILE and KEVIN B. KILCOYNE, Plaintiffs, v. AMGEN, INC., et al, Defendants. |
| Court | U.S. District Court — Eastern District of New York |
MORRISON & FOERSTER LLP By: Carl H. Loewenson, Jr., & J. Alexander Lawrence Attorneys for Defendant U.S. Oncology Inc.
STONE & MANGNANINI LLP By: David S. Stone & Robert A Magnanini Attorneys for Relators Joseph Piacentile & Kevin B. Kilcoyne
Relators Joseph Piacentile and Kevin B. Kilcoyne (collectively, "Relators") bring this qui tam action on behalf of the United States and 12 states, alleging that U.S. Oncology, Inc. ("U.S. Oncology" or "USON") violated -and conspired with Kilcoyne's former employer, Amgen, Inc. ("Amgen"), to violate-the False Claims Act, 31 U.S.C. §§ 3729 et seq. (the "FCA"), and similar state statutes. U.S. Oncology now moves to dismiss Relators' Fourth Amended Complaint ("FAC"), arguing, inter alia, that the FCA's public disclosure bar strips this Court of subject-matter jurisdiction over this action and that the FAC fails to allege the particularized facts necessary to state a claim under the FCA or the state statutes. For the reasons set forth below, U.S. Oncology's motion to dismiss is granted and this action is dismissed with prejudice.
This action has already been the subject of two lengthy opinions; U.S, ex rel. Piacentile v. Amgen Inc., No 04-CV-3983 (SJ) (RML), 2013 WL 5460640, at *2 (E.D.N.Y. Sept. 30, 2013) ("Piacentile I"), and U.S. ex rel. Piacentile v. Amgen, Inc., 336 F.Supp.3d 119, 123 (E.D.N.Y. 2018) (“Piacentile II"). Those opinions discussed, among other things, Piacentile's history of filing qui tam actions, the procedural history of this case, and the allegations of Relators' third amended complaint. The Court assumes familiarity with the prior opinions but will briefly repeat or summarize portions of them in order to provide context for this Memorandum and Order.
Relator Joseph Piacentile is a physician who, following his conviction on one count of conspiracy to submit false Medicare claims and one count of income tax evasion, has operated whistleblowersagainstfraud.com, a website that seeks to partner with individuals who have information about frauds perpetrated against the United States Government. In September 2004, Piacentile -who had never worked for Amgen or U.S. Oncology - commenced this qui tam action on behalf of the United States, alleging that those two corporations violated four provisions of the FCA. Piacentile acknowledges that between 2004 and 2011 many other whistleblowers also filed qui tam actions against Amgen for the conduct he alleged in this action. (FAC ¶ 9.) He concedes that his was the second of these FCA actions but he maintains that his action was "the first to address Amgen's illegal kickbacks to oncology networks and physicians." (Id. ¶ 10.)
Between 2007 and 2010, the pleading in this action was amended three times. In April 2007, Piacentile filed an amended complaint which added Kilcoyne, a former Amgen sales representative, as a relator. In June 2009, Relators filed a second amended complaint, which added four new defendants: Amerisource Bergen Corporation, Amerisource Bergen Specialty Group, International Physicians Network, and International Oncology Network (collectively, the "ABC Defendants"). And in April 2010, Relators filed the Third Amended Complaint ("TAC"), which added 22 state-law claims to the four FCA causes of action contained in the first three pleadings. The TAC was brought not only on behalf of the United States, but also on behalf of 21 states and the District of Columbia (collectively, the "States").
In 2012, Amgen, United States, the States, and the relators in ten other qui tam actions filed against Amgen collectively reached a settlement of the claims regarding Amgen's marketing and promotion of certain drugs, including Aranesp, Epogen, Neulasta, and Neupogen. According to Relators, "Amgen paid $762 million to the [United States] Government and the States for precisely the conduct that Relators ... alleged in their complaint, i.e. that Amgen employed a variety of illegal methods to pay kickbacks to purchasing organizations and networks that were not reported to the Government, including oncology networks, to induce those physicians to purchase and prescribe Amgen's drugs." (FAC ¶ 16.) According to Relators, that 2012 global settlement agreement stated:
Amgen offered or paid, or caused to be paid directly and indirectly through Amerisource Bergen Specialty Group, Amerisource Bergen Corp., Cardinal Health Specialty Pharmaceutical Distribution, International Nephrology Network, International Oncology Network, Onmark, National Oncology Alliance, Oncology Supply, Inc., and Oncology Therapeutics, Inc., to healthcare providers, including, physicians, pharmacists, physician organizations, hospitals, managed care organizations, and group purchasing organizations and physician practice management organizations, remuneration, specifically in the form of cash, free product, free samples, product overfill, dinners, travel, hotels, consulting fees, education research grants, free consulting services, free reimbursement support services to assist physicians to secure coverage for Amgen products, improper remuneration disguised as proper discounts and rebates, improperly bundled products, payments for phony data collection studies and information collection programs, honoraria and speaker fees, for the purpose of influencing health care providers' selection and utilization of Aranesp, Enbrel, Epogen, Neulasta, Neupogen, and Sensipar regardless of whether the product was administered, reimbursable by federal health care programs, or medically necessary.
Relators decided not to join in that settlement. However, Relators did file an "Agreed Motion to Dismiss Relators' State Law Claims against Amgen with Prejudice," in which Relators, with the States' consent, sought to voluntarily dismiss with prejudice the State-law Claims against Amgen pursuant to Fed.R.Civ.P. 41(a)(2). That motion was granted in an order dated January 16, 2013.
In a "Notice of Declination in Part" dated and filed on December 19, 2012, the United States declined to intervene in this action except to the extent of filing a motion to dismiss with prejudice the claims brought on its behalf against Amgen. In February 2013, the United States filed that motion, arguing, inter alia, that 31 U.S.C. § 3730(c)(2)(A) permits the Government to dismiss a qui tam action as a matter of prosecutorial discretion. In Piacentile I, the Court granted the motion to dismiss on that ground.
On April 11, 2014, Relators filed a stipulation dismissing all claims against the ABC Defendants. On that same day, the States filed a Notice of Declination to Intervene, declining to intervene with respect to Relators' State-law Claims against U.S. Oncology. That left Relators as the only plaintiffs in this action and U.S. Oncology as the only remaining defendant.
U.S. Oncology then moved to dismiss the action, principally arguing that the TAC failed to allege the particularized facts necessary to state a claim under the FCA or analogous state statutes. The Court granted that motion in Piacentile II. The Court assumes familiarity with that memorandum and order and, accordingly, will only briefly summarize it here.
Preliminarily the Court noted Relators' causes of action themselves contained no factual allegations whatsoever. Rather, they consisted of two sentences: one incorporating by reference all the allegations contained in the first 150 paragraphs of the TAC and another alleging that, "[a]s more particularly set forth in the foregoing paragraphs, by virtue of the acts alleged herein/' the defendants violated a specific provision of the FCA. (Piacentile II, 336 F.Supp.2d at 127.) The Court noted that this left the reader to guess which allegations related to each cause of action, (Id. at 131.) In addition, the four federal causes of action alleged violations of sections of 31 U.S.C. § 3729 which were amended in 2009, even though the allegations of the TAC principally alleged facts from earlier in that decade. (Id.)
The Court then addressed the specific causes of action and found that all but the fourth lacked the particularity required by Rule 9(b). The Court held that the first two causes of action-which alleged violations of 31 U.S.C. § 3729(a)(1)(A) and (B) (2009), respectively - did not adequately identify the false claims for which Relators sought to recover and failed to even specify even a range of dates during which the claims were made. (Piacentile II, 336 F.Supp.2d at 132.) The Court also held that these two causes of action did not adequately explain the theory of liability that Relators intended to pursue and did not specifically allege that U.S. Oncology knew that the claims it filed on behalf of its customers were false. (Id., at 132-34.) The Court dismissed the State-law claims on similar grounds, finding that the TAC failed to allege those 22 claims with particularity, (Id. at 138.)
With respect to the third cause of action, which alleged a violation of the "reverse false claims" provisions of 31 U.S.C. § 3729(a)(1)(G) (2009), the Court assumed that the third cause of action related to the Medicaid Rebate Statute ("MRS"), 42 U.S.C. § 1396r-8 -the only provision mentioned in the TAC which obligated any of the defendants to pay money to the Government. (Piacentile II, 336 F.Supp.2d at 135.) However, the TAC alleged that the MRS obligated drug manufacturers to report "best price" information to the Centers for Medicare...
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