Medscript Pharmacy, LLC v.My Script, LLC, LLC, No. 14 C
0469, 2015 WL 149062 (N.D. Ill. Jan. 12, 2015)
The complaint alleged that Medscript was a Professional
Compounding Centers of America (PCCA) certified compounding pharmacy, while
defendants are compounding pharmacies/former owners and members of Medscript. The non-pharmacy defendants sold their
interests in Medscript and received a patient list containing health
information to verify the amount of payments they’d get from Medscript
post-closing. The non-pharmacy
defendants allegedly gave the patient list to My Script and defendant
Valuscript to market those pharmacies and get prescribers to fill prescriptions
with those pharmacies, in alleged violation of HIPAA.
My Script employees or agents allegedly falsely told
Medscript patients and prescribers that (1) Medscript was out of business and
My Script was taking over its patients and would fill the patients’
prescriptions, or (2) Medscript had changed its name to My Script, and My
Script would fill the patients’ prescriptions going forward. My Script also
made these false statements to prescribers. Also, Valuscript allegedly sent patients
unauthorized prescriptions that were supposed to be filled by Medscript, and billed
the patients’ insurance carriers for the prescriptions. Finally, My Script and Valuscript allegedly
sent their representatives prescription pads to give to prescribers that had
Medscript’s name on them but My Script’s and Valuscript’s fax numbers. Thus,
prescribers would believe they were filling prescriptions with Medscript but
were unknowingly filling them with My Script and Valuscript.
First, defendants argued that the complaint didn’t plead
with sufficient specificity under Rule 9(b), and the court agreed that allegations
of false statements/passing off with the prescription pads triggered Rule 9(b). But the complaint adequately alleged the who
(My Script employees), what (out of business/name change/prescription pads—direct
quotes not needed), where (to Medscript patients and prescribers), when (after
they received the patient list), and how (use of the patient list). Thus, the Lanham Act claims and related
claims survived Rule 9(b) scrutiny.
(Note the interesting fact that the court applies Rule 9(b) to what’s
ordinarily considered a classic trademark claim, passing off, and courts don’t often do
that with §43(a)(1)(A) claims.) But the
civil conspiracy claim wasn’t pled with sufficient particularity.
Defendants argued that the allegations didn’t establish “commercial
advertising or promotion” because the statements weren’t made to the general
population or a significant portion of the industry, but were person-to-person
communications. Advertising or promotion
is usually directed to a subset of the public.
But the Lanham Act requires that communications be made to a significant
portion of the relevant industry. Here, the relevant industry was the
compounding pharmacy industry. It was plausible that Medscript’s patients and
prescribers contacted by defendants represented a significant portion of that
industry, though factual development might ultimately show otherwise. Thus both Lanham Act and related state law
claims (including tortious interference) survived.
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