United States ex rel. Colquitt v. Abbott Labs., No. 3:06–cv–1769–M.
| Court | United States District Courts. 5th Circuit. United States District Courts. 5th Circuit. Northern District of Texas |
| Writing for the Court | BARBARA M.G. LYNN |
| Citation | 864 F.Supp.2d 499 |
| Decision Date | 24 August 2012 |
| Docket Number | No. 3:06–cv–1769–M. |
| Parties | UNITED STATES of America ex rel. Kevin N. COLQUITT, Plaintiff, v. ABBOTT LABORATORIES f/k/a Guidant Corporation, Abbott Vascular Solutions, Inc., Boston Scientific Corporation, Johnson & Johnson, Cordis Corporation, Defendants. |
864 F.Supp.2d 499
UNITED STATES of America ex rel. Kevin N. COLQUITT, Plaintiff,
v.
ABBOTT LABORATORIES f/k/a Guidant Corporation, Abbott Vascular Solutions, Inc., Boston Scientific Corporation, Johnson & Johnson, Cordis Corporation, Defendants.
No. 3:06–cv–1769–M.
United States District Court,
N.D. Texas,
Dallas Division.
March 30, 2012.
Order Denying Reconsideration Aug. 24, 2012.
[864 F.Supp.2d 503]
Sean Robert McKenna U.S. Attorney's Office, Laura Jean Baughman, Baron & Budd PC, Dallas, TX, Michael F. Hertz, Andrew M. Beato, David U. Fierst, Stein Mitchell & Muse, Jacob A. Stein, Stein Mitchell & Mezines LLP, Kelly Bagby, Stacy J. Canan, AARP Foundation Litigation, Washington, DC, for Plaintiff.
Michael E. McCue, Meadows Collier Reed Cousins & Blau LLP, Wayne B. Mason, Katherine W. Binns, Sedgwick LLP, Joseph P. Griffith, Greenberg Traurig LLP, Joel S. Allen, Elizabeth M. Bedell, Morgan Lewis & Bockius LLP, Dallas, TX, Geoffrey E. Hobart, Kathryn C. Arnold, Covington & Burling LLP, Mitchell J. Lazris, Logan Lovells U.S. LLP, Kathleen McDermott, Morgan Lewis & Bockius LLP, Washington, DC, Andrea W. Trento, Stephen J. Immelt, Hogan Lovells U.S. LLP, Baltimore, MD, for Defendants.
[864 F.Supp.2d 504]
BARBARA M.G. LYNN, District Judge.
Before the Court are Motions to Dismiss filed by Boston Scientific Corporation [Docket Entry # 110], Cordis Corporation and Johnson & Johnson (collectively, “Cordis”) [Docket Entry # 112], and Abbott Laboratories and Abbott Vascular Solutions, Inc. (collectively, “Abbott”) [Docket Entry # 115]. For the reasons stated below, the Motions to Dismiss filed by Boston Scientific and Cordis are GRANTED, and the Motion to Dismiss filed by Abbott is GRANTED in part and DENIED in part. As explained below, the Relator is granted leave to amend some of the dismissed claims.
+-----------------------------------+
¦I.¦BACKGROUND ¦504¦
+-----------------------------------+
+------------------------------------------+
¦ ¦A.¦The Parties ¦505 ¦
+--+--+-------------------------------+----¦
¦ ¦B.¦Colquitt's Allegations ¦505 ¦
+------------------------------------------+
+----------------------------------------------------+
¦ ¦ ¦1.¦False Statements to the FDA ¦505 ¦
+----------------------------------------------------+
+-----------------------------------------------------+
¦ ¦ ¦ ¦a.¦FDA Regulation of Medical Devices ¦505 ¦
+---+---+--+--+----------------------------------+----¦
¦ ¦ ¦ ¦b.¦Alleged False Statements ¦507 ¦
+-----------------------------------------------------+
+----------------------------------------------------+
¦ ¦ ¦2.¦Off–Label Promotion and Marketing ¦507 ¦
+----------------------------------------------------+
+----------------------------------------------------------------------------+
¦ ¦ ¦ ¦a. ¦Colquitt's Experiences as an Abbott Territory ¦507 ¦
¦ ¦ ¦ ¦ ¦Manager ¦ ¦
+----+----+---+---+--------------------------------------------------+-------¦
¦ ¦ ¦ ¦b. ¦Off–Label Marketing in Vascular Journals and on ¦510 ¦
¦ ¦ ¦ ¦ ¦the Internet ¦ ¦
+----------------------------------------------------------------------------+
+-------------------------------------------------------+
¦ ¦ ¦3.¦Inducement of Claims for Reimbursement¦510 ¦
+---+---+--+--------------------------------------+-----¦
¦ ¦ ¦4.¦Kickback Allegations ¦511 ¦
+-------------------------------------------------------+
+------------------------------------------+
¦ ¦C.¦Colquitt's Legal Theories ¦511 ¦
+--+--+-------------------------------+----¦
¦ ¦D.¦Procedural Posture ¦512 ¦
+------------------------------------------+
+---------------------------------------------------+
¦ ¦ ¦ ¦
+---+------------------------------------------+----¦
¦II.¦ANALYSIS ¦513 ¦
+---------------------------------------------------+
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¦ ¦A. ¦Lack of Subject Matter Jurisdiction—Public Disclosure Bar¦513 ¦
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+----------------------------------------------------+
¦ ¦ ¦1.¦Alleged Public Disclosures ¦514 ¦
+---+---+--+------------------------------------+----¦
¦ ¦ ¦2.¦Legal Standard ¦516 ¦
+---+---+--+------------------------------------+----¦
¦ ¦ ¦3.¦Analysis ¦517 ¦
+----------------------------------------------------+
+-------------------------------------------------------------------------+
¦ ¦ ¦ ¦a. ¦Public disclosure of allegations or transactions¦517 ¦
+-------------------------------------------------------------------------+
+-----------------------------------------------------------------+
¦ ¦ ¦ ¦ ¦i. ¦Statutorily specified form ¦517 ¦
+----+---+---+---+---+-------------------------------------+------¦
¦ ¦ ¦ ¦ ¦ii.¦Allegations or transactions ¦519 ¦
+-----------------------------------------------------------------+
+----------------------------------------------------------------------------+
¦ ¦ ¦ ¦ ¦ ¦(1) ¦False statements to FDA ¦519 ¦
+-----+---+---+---+---+-----+----------------------------------------+-------¦
¦ ¦ ¦ ¦ ¦ ¦(2) ¦Evidence of off-label promotion ¦521 ¦
+----------------------------------------------------------------------------+
+----------------------------------------------------------------------------+
¦ ¦ ¦ ¦ ¦iii.¦Conclusion—Public disclosure of allegations ¦523 ¦
¦ ¦ ¦ ¦ ¦ ¦or transactions ¦ ¦
+----------------------------------------------------------------------------+
+--------------------------------------------------------------------+
¦ ¦ ¦ ¦b. ¦“Based upon” public disclosure of allegations¦523 ¦
+----+---+--+---+---------------------------------------------+------¦
¦ ¦ ¦ ¦c. ¦Original Source ¦524 ¦
+----+---+--+---+---------------------------------------------+------¦
¦ ¦ ¦ ¦d. ¦Conclusion—Public Disclosure Bar ¦529 ¦
+--------------------------------------------------------------------+
+----------------------------------------------------------------------------+
¦ ¦B. ¦Failure to State a Claim or Plead Fraud with Particularity¦529 ¦
+----------------------------------------------------------------------------+
+----------------------------------------------------+
¦ ¦ ¦1.¦Off–Label–Promotion Claims ¦530 ¦
+----------------------------------------------------+
+---------------------------------------------------------+
¦ ¦ ¦ ¦a.¦Claim Falsity ¦530 ¦
+---+---+--+--+-------------------------------------+-----¦
¦ ¦ ¦ ¦b.¦Failure to Plead with Particularity ¦533 ¦
+---+---+--+--+-------------------------------------+-----¦
¦ ¦ ¦ ¦c.¦Conclusion—Off–Label Promotion Claims¦535 ¦
+---------------------------------------------------------+
+----------------------------------------------------+
¦ ¦ ¦2.¦Kickback Claims ¦536 ¦
+----------------------------------------------------+
+------------------------------------------+
¦ ¦C.¦State Law Claims ¦537 ¦
+------------------------------------------+
+--------+
¦¦¦¦¦¦¦ ¦¦
+--------+
+-------------------------------------------------------------------+
¦III.¦CONCLUSION ¦537 ¦
+-------------------------------------------------------------------+
Relator Kevin Colquitt brings this qui tam action, under the federal False Claims Act (“FCA”) and several analogous state false claims statutes, against the Defendants, who are medical device manufacturers. The crux of Colquitt's suit is that the Defendants engaged in a scheme to thwart the FDA approval process for vascular stents
[864 F.Supp.2d 505]
by fraudulently obtaining FDA clearance for their devices as biliary stents, when in fact the Defendants intended to and did market and promote them as vascular stents. Colquitt argues that this scheme led or was material to false claims for reimbursement submitted to federal payer programs, such as Medicare and Medicaid. The Defendants move to dismiss Colquitt's claims under Rules 12(b)(1) and 12(b)(6), arguing that the FCA's public disclosure jurisdictional bar deprives the Court of jurisdiction over Colquitt's claims, see31 U.S.C. § 3730(e)(4), that Colquitt has failed to state a plausible claim for relief as required by Rule 8, and that Colquitt has not pleaded fraud with particularity as required by Rule 9(b).
A. The PartiesDefendants are medical device manufacturers who make and sell biliary stents. Colquitt held the position of Territory Manager for Abbott, successor-in-interest to Guidant Corporation, from February 2004 to July 2006. Colquitt alleges that during this period he witnessed and participated in a scheme through which Abbott promoted the off-label use of its biliary stents, and induced physicians and hospitals to seek reimbursement from federal payer programs for such off-label use. Although Colquitt never worked for Boston Scientific or Cordis, he alleges that through his employment with Abbott he witnessed similar off-label promotion by them as well.
B. Colquitt's AllegationsThe allegations in the Third Amended Complaint (“TAC”) can be divided into four categories: (1) allegations concerning false statements allegedly made by the Defendants to the FDA in obtaining market clearance for their stents; (2) allegations that the Defendants promoted and marketed their biliary stents for off-label, vascular applications; (3) allegations that the Defendants induced healthcare providers to seek reimbursement from federal payer programs for the off-label use of their biliary stents; and (4) allegations of illegal kickbacks provided by the Defendants to physicians and hospitals to use their stents for off-label uses.
1. False Statements to the FDAUnder the Federal Food, Drug, and Cosmetic Act (“FDCA”) and the amendments thereto, medical devices are classified as Class I, Class II, or Class III. 21 U.S.C. § 360c(a)(1) (2006). Which class a particular device is placed in is determined by the level of regulatory review necessary to provide assurance of the device's “safety and effectiveness.” Id. § 360c(a)(1)(A)(i), (B), (C)(i). Class I devices,...
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...thereby, the Fifth Circuit has held that this standard is not a straitjacket." United States ex rel. Colquitt v. Abbott Labs., 864 F. Supp. 2d 499, 533 (N.D. Tex. 2012) (quotation marks omitted) (citing Grubbs, 565 F.3d at 186, 190). Therefore, in the context of a claim under the FCA presen......
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...of Homeland Security. Id. at 4-5 (citing Allergan Motion at 15 n. 11) (citing United States ex rel. Colquitt v. Abbott Labs. , 864 F. Supp. 2d 499, 518 (N.D. Tex. 2012), aff'd , 858 F.3d 365 (5th Cir. 2017) ; United States ex rel. Doe v. Staples, Inc. , 932 F. Supp. 2d 34, 40 (D.D.C. 2013),......
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...original Complaint fails to provide a basis for jurisdiction in the first instance." United States ex rel. Colquitt v. Abbott Labs. , 864 F.Supp.2d 499, 514 (N.D. Tex. 2012). Thus, this Court will focus only on the Amended Complaint in analyzing whether it has jurisdiction under the 1986 ve......
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Kostic v. Tex. A & M Univ. at Commerce, No. 3:10–cv–2265–M–BN.
...or (4) the motion is justified by an intervening change in the controlling law.”United States ex rel. Colquitt v. Abbott Labs., 864 F.Supp.2d 499, 539 (N.D.Tex.2012) (citations omitted). The undersigned concludes that, although these arguments are beyond the scope of Judge Lynn's order gran......
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United States ex rel. Acad. Health Ctr., Inc. v. Hyperion Found., Inc., CIVIL ACTION NO. 3:10-CV-552-CWR- LRA
...thereby, the Fifth Circuit has held that this standard is not a straitjacket." United States ex rel. Colquitt v. Abbott Labs., 864 F. Supp. 2d 499, 533 (N.D. Tex. 2012) (quotation marks omitted) (citing Grubbs, 565 F.3d at 186, 190). Therefore, in the context of a claim under the FCA presen......
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Silbersher v. Allergan Inc., Case No. 18-cv-03018 JCS
...of Homeland Security. Id. at 4-5 (citing Allergan Motion at 15 n. 11) (citing United States ex rel. Colquitt v. Abbott Labs. , 864 F. Supp. 2d 499, 518 (N.D. Tex. 2012), aff'd , 858 F.3d 365 (5th Cir. 2017) ; United States ex rel. Doe v. Staples, Inc. , 932 F. Supp. 2d 34, 40 (D.D.C. 2013),......
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United States ex rel. Hendrickson v. Bank of Am., N.A., CIVIL ACTION NO. 3:16-CV-0292-S
...original Complaint fails to provide a basis for jurisdiction in the first instance." United States ex rel. Colquitt v. Abbott Labs. , 864 F.Supp.2d 499, 514 (N.D. Tex. 2012). Thus, this Court will focus only on the Amended Complaint in analyzing whether it has jurisdiction under the 1986 ve......
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Kostic v. Tex. A & M Univ. at Commerce, No. 3:10–cv–2265–M–BN.
...or (4) the motion is justified by an intervening change in the controlling law.”United States ex rel. Colquitt v. Abbott Labs., 864 F.Supp.2d 499, 539 (N.D.Tex.2012) (citations omitted). The undersigned concludes that, although these arguments are beyond the scope of Judge Lynn's order gran......