Commonwealth of Massachusetts ex rel. Kelly, et al. v. Novartis Pharmaceuticals Corporation, et al. (Lawyers Weekly No. 12-098-17)

    COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss SUPERIOR COURT CIVIL ACTION 2016-03107-BLS1 COMMONWEALTH OF MASSACHUSETTS, EX REL., ALLISON KELLY AND FRANK GARCIA vs. NOVARTIS PHARMACEUTICALS CORPORATION & Others1 1 Novartis Corporation and Genentech, Inc. 2 The District Court’s order actually dismissed the state claims with prejudice, notwithstanding its declination of jurisdiction over them. The First Circuit reversed that part of the District Court’s decision.  It observed that while the District Court could have dismissed the state claims based on the same reasoning applied to the federal claims had it retainedjurisdiction, once it declined jurisdiction, it was required to dismiss the state claims MEMORANDUM OF DECISION AND ORDER ON DEFENDANT’S MOTION TO DISMISS RELATORS’ FIRST AMENDED COMPLAINT Allison Kelly and Frank Garcia (Relators) brought qui tam actions against Genentech, Inc. (Genentech) and Novartis Pharmaceuticals Corporation (Novartis) in federal district court in Massachuesetts under the Federal False Claims Act (FCA), 31 U.S.C. § 3729 et seq., the Massachusetts False Claims Act (MFCA), G. L. c. 12, § 5B(a)(1)-(10), and several other analogous state statutes.  The federal claims asserted in their complaints were dismissed by the District Court for failure to plead the alleged fraud with the specificity required by Fed. R. Civ. P. 9(b).  See U.S. ex rel. Garcia v. Novartis  Pharm. Corp.,91 F. Supp. 3d 87 (D. Mass. 2015).  The dismissal was affirmed by the First Circuit Court of Appeals.  See U.S. ex. rel. Kelly v. Novartis Pharm. Corp.,827 F. 3d 5 (1stCir. 2016) (Kelly).  While the Relators’ FCA claims were dismissed with prejudice, their state claims were dismissed without prejudice because the District Court declined to exercise supplemental jurisdiction over them.2 The Relators then filed 2     without prejudice.  Kelly, 827 F. 3d at 16. 3 Novartis Corporation is also a named defendant, but the Relators did not serve that company with a summons and complaint or the Amended Complaint, so the case is dismissed as to it. 4 Because the court concludes that the Relators have not complied with Rule 9(b), it will not consider the defendants’ arguments that the Amended Complaint should also be dismissed because the“public disclosure” bar applies or because the Relators failed to file the Amended Complaint under seal. thequi tam action against Genentech and Novartis now before the Superior Court alleging claims underthe MFCA.3 As with their previous federal complaints, the Relators allege that the defendants, who jointly marketed the asthma medication Xolair, providedillegal kickbacks to certain Massachusetts doctors, which caused the doctors to prescribe Xolair to Massachusetts Medicaid patients and submit false reimbursement claims for the drug to Medicaid.  The defendants now move to dismiss the Relator’s First Amended Complaint (Amended Complaint) contending, among other grounds, that the Relators have again failed […]

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