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Second Circuit Agrees That State’s Lawsuit Against Drug Maker Is Not Class Action – Purdue Pharma v. Kentucky

By January 17, 2013July 18th, 2019Dangerous Drugs

Pharmaceutical liability attorneys like me are very familiar with state lawsuits against drug manufacturers, alleging that they drove up Medicaid costs with false representations about their drugs. In many cases, there are similar lawsuits filed by every state and the federal government, after a revelation that one of the pharmaceutical companies has deceived regulators about safety, paid kickbacks and more. In Purdue Pharma et al. v. Commonwealth of Kentucky, however, Kentucky appeared to be acting on its own when it sued the manufacturer of OxyContin, a powerful prescription painkiller that has been widely abused. The Second U.S. Circuit Court of Appeals recently affirmed a lower court’s decision to return that case to Kentucky state court.
The Commonwealth of Kentucky and Pike County sued in 2007, alleging that Purdue hid the risk of OxyContin addiction from Kentucky officials, patients and health care providers. They alleged that Purdue marketed it as “less addictive, less subject to abuse and diversion, and less likely to cause tolerance and withdrawal than other pain medications.” The plaintiffs said this was false and misleading, causing Kentucky doctors to overprescribe the drug and creating addiction and the attendant crime and state costs. Purdue removed the case to federal court, alleging that it was a disguised class action under the Class Action Fairness Act. It was then moved to the Southern District of New York, where the plaintiffs successfully argued that this is not a federal or class-action matter, and should therefore be sent back to Kentucky. Purdue asked for leave to appeal.
The Second Circuit opinion addressed whether Purdue may appeal at the same time as the merits of CAFA removal, since the same issues underlay both. It quickly agreed with several sister circuits that parens patriae actions like this one are not class actions under CAFA. CAFA defines a class action as any action filed under Rule 23 of the Federal Rules of Civil Procedure, or a similar state law or rule. The Second Circuit found that none of the laws cited in Kentucky’s lawsuit bear a resemblance to a class action law. A parens patriae action is similar in that it is filed by a state that seeks to protect the people of that state, but the number of those people does not make it a class action, the Second said. Even if the people of Kentucky are the real parties in interest, the court said, this matters only as to diversity of citizenship. Thus, it denied leave to appeal, upholding the remand to Kentucky state court.
This decision conforms to the decisions made by almost every other circuit to consider the matter, and as a defective prescription drug lawyer, I approve. A different ruling would not only depart from the definition of “class action,” but also impede states’ ability to bring lawsuits when their Medicaid programs have been deceived by drug makers’ illegal advertising and marketing. These settlements have become common in recent years, creating millions in revenue for many states. In one of the few such cases that went to trial, the state of Arkansas won a $1.1 billion verdict last year against the maker of Risperdal (risperidone) for off-label use in dementia patients. This kind of behavior is highly profitable, especially when it involves Medicaid, but as a dangerous drug attorney, I know it also poses serious risks to patients who deserve to be well informed about their medicine.

Carey, Danis & Lowe represents clients around the United States who have suffered serious injuries or lost a loved one because of a prescription drug with serious safety problems that should have been disclosed. If you or someone you love was hurt and you’d like to discuss your legal options with an experienced lawyer, call us today at 1-877-678-3400 or send us a message through our website.
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