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Presswood v. Pernix Therapeutics Holdings

United States District Court, E.D. Missouri, Eastern Division

November 30, 2016

ALAN PRESSWOOD, D.C., P.C., individually and on behalf of all others similarly situated, Plaintiff,
v.
PERNIX THERAPEUTICS HOLDINGS, et al., Defendants.

          MEMORANDUM AND ORDER

          NANNETTE A. BAKER UNITED STATES MAGISTRATE JUDGE.

         This matter is before the Court on Defendants Pernix Therapeutics Holdings and Somaxon Pharmaceuticals, Inc.'s Motion to Dismiss Plaintiff Alan Presswood, D.C. P.C.'s Second Amended Complaint and Supplemental Motion to Dismiss Plaintiff's Second Amended Complaint. [Docs. 29, 67.] Plaintiff filed memoranda in opposition to Defendants' motions to dismiss. [Docs. 34, 74.] Defendants filed Reply Briefs. [Docs. 37, 75.] On November 7, 2016, the Court heard oral argument on Defendants' motions to dismiss. During the oral argument, Plaintiff filed a new motion to stay the case until putative plaintiff Dr. Alan Presswood (Dr. Presswood) completes currently pending bankruptcy litigation.

         Essentially, the Court is tasked with determining whether the current Plaintiff has standing to bring this action, which the parties agree it does not. Second, the Court must determine whether it is required to stay this action until putative plaintiff Dr. Presswood completes currently pending bankruptcy litigation. For the following reasons, the Court will grant Defendants' motions to dismiss and dismiss this action.

         I. Procedural Background

         This action has a long and circuitous history.

         Dr. Allen Presswood formed Associated Physical Medicine, P.C. (APM) in 1990 as Presswood Chiropractic, with the name change to APM occurring in 2001. [Doc. 75-1.] APM was administratively dissolved by the State of Missouri in 2005. [Doc. 75-2.] Dr. Presswood continued to file taxes in the name of APM into 2011. [Doc. 74-5, Ex. 1.] In April 2011, two unsolicited faxes were allegedly sent by Scienomics Group addressed to Dr. Brent Palmer, who worked for the administratively dissolved APM at the time. Dr. Presswood contends that he managed APM as a sole proprietorship at the time. On April 30, 2012, Dr. Presswood formed Alan Presswood, D.C., P.C., a professional corporation. [Doc. 75-3.] On May 29, 2012, Dr. Presswood filed for personal chapter 7 bankruptcy in the Southern District of Illinois. [Doc. 75-4.] Dr. Presswood claimed Alan Presswood D.C., P.C. and APM as assets, but stated that APM was no longer operating. [Doc. 75-4 at 12.]

         On February 15, 2015, Plaintiff Alan Presswood, D.C., P.C., hereinafter referred to as Plaintiff, filed this case as a class action against Defendants Pernix Therapeutics Holdings, Somaxon Pharmaceuticals, Inc., and John Does 1-10 in the Circuit Court of St. Louis County. Plaintiff also contemporaneously filed a Motion to Certify a Class Action. In its original Petition, Plaintiff accused Defendants of violating the Telephone Consumer Protection Act, 47 U.S.C. § 227 (“TCPA”), the Missouri Merchandising Practices Act, Mo. Rev. Stat. § 407.020, and committing conversion. [Doc. 5.] Plaintiff claimed that Defendants sent two unsolicited facsimile advertisements in April 2011. [Doc. 5.] Defendants removed the action to this court on April 8, 2015.

         On April 15, 2015, Plaintiff filed a Consent Motion to Dismiss its Motion for Class Certification, asserting that the parties agreed that until Plaintiff renewed its motion for class certification or notifies the Court that it will not pursue its class claims under Rule 23, Defendants agree not to make any individual settlement offers or a Rule 68 Offer of Judgment. On April 15, 2015, Defendants filed a Motion to Dismiss Plaintiff's Complaint for lack of standing and failure to state a claim on all counts. [Doc. 14.] On April 17, 2015, Plaintiff then filed a Motion to Dismiss Count III, under the Missouri Merchandising Practices Act, without prejudice. [Doc. 16.] On April 22, 2015, Plaintiff filed an Amended Complaint. [Doc. 19.] On April 23, 2015, Plaintiff filed a Second Amended Complaint, asserting only claims under the TCPA. [Doc. 22.] The Court denied Plaintiff's Motion to Dismiss Count III as moot due to the filing of the amended complaints. [Doc. 28.]

         On May 15, 2015, Defendants filed a Motion to Dismiss Plaintiff's Second Amended Complaint. [Doc. 29.] Defendants asserted that Plaintiff lacked standing to sue Defendants on its own or on behalf of a class, Plaintiff's amended factual allegations are not and cannot be true, and Plaintiff's revised allegations fail as a matter of law. Defendants noted that Plaintiff had not received the faxes and did not exist at the time the faxes were sent. Defendants also asserted that the TCPA claim was not included in Dr. Presswood's individual bankruptcy filing. Plaintiff responded that Dr. Alan Presswood (individual) should be allowed to join this action under Federal Rule of Civil Procedure 17 as a real party in interest. [Doc. 34.] In its reply Brief, Defendants asserted that Plaintiff violated Rule 15(a)(2)'s requirement that Plaintiff obtain consent or leave of court to file an Amended Complaint. [Doc. 37.] Further, Defendants assert that Plaintiff failed to respond to the Motion to Dismiss and added new factual allegations in its brief. [Doc. 37.]

         Plaintiff also filed a Motion for Leave to File a Third Amended Complaint so that it could add Dr. Presswood as a Plaintiff. [Doc. 35.] Defendants filed a memorandum in opposition stating that Plaintiff had changed its basis for standing for a third time and the proposed third amended complaint made alternative and contradictory claims in a last ditch effort to demonstrate standing. [Doc. 40.] Plaintiff filed a Reply Brief, which stated that its motion for leave to amend should be granted based on the need to add Dr. Presswood alone. [Doc. 43.]

         On June 25, 2015, Dr. Presswood filed amended pleadings in the bankruptcy court asserting this action as a claim of his bankruptcy estate and he requested an exemption under bankruptcy law. At a status conference on July 22, 2015, the Court stayed ruling on Defendants' Motion to Dismiss until the bankruptcy court addressed Dr. Presswood's filings. [Doc. 48.] The Court also granted Plaintiff's Motion to Withdraw its Motion for Leave to file a Third Amended Complaint. [Doc. 51.]

         On September 15, 2016, the bankruptcy court for the Southern District of Illinois ruled that at the time that this action was filed, the claim belonged to the Trustee of Dr. Presswood's bankruptcy estate and not Dr. Presswood. [Doc. 67-2.] The bankruptcy court, however, found that the claim could be exempted under bankruptcy law and as of the date of the bankruptcy court's order the claim is exempted from the estate. [Doc. 67-2.] After that ruling, Dr. Presswood started additional litigation in the bankruptcy court seeking a bankruptcy court order that the Trustee abandon the claim. Before Dr. Presswood can attempt to obtain standing, the claim would need to be abandoned. In this court, Plaintiff sought leave to stay this case until the proceedings regarding abandonment of the claim are completed in bankruptcy court. [Doc. 70.] This court denied Plaintiff's motion to stay and ordered Plaintiff to file a memorandum in opposition to Defendants' Supplemental Motion to Dismiss. [Doc. 73.] The Court heard oral argument on Defendants' motions to dismiss on November 7, 2016. At the time of the oral argument, Plaintiff renewed its Motion to Stay pending the conclusion of the bankruptcy litigation concerning Dr. Presswood.

         III. Standard of Review

         “In every federal case the court must be satisfied that it has jurisdiction before it turns to the merits of other legal arguments.” Carlson v. Arrowhead Concrete Works, Inc., 445 F.3d 1046, 1050 (8th Cir. 2006). “It is axiomatic that a court may not proceed at all unless it has jurisdiction.” Crawford v. F. Hoffman-LaRoche, 267 F.3d 760, 764 (8th Cir. 2001). “If the court determines at any time that it lacks subject matter jurisdiction, the court must dismiss the action.” Fed.R.Civ.P. 12(h)(3). Federal Rule of Civil Procedure 12(b)(1) requires dismissal if the court lacks subject matter jurisdiction over a claim. To dismiss an action under Rule 12(b)(1), the complaint must either be successfully challenged on the factual truthfulness of its assertions, or successfully challenged on its face. Archdiocese of St. Louis, v. Sebelius, No. 4:12-CV-924 JAR, 2013 WL 328926 at *4 (E.D. Mo. Jan. 29, 2013). A court deciding a motion under Rule 12(b)(1) must distinguish between a facial attack and a factual attack on jurisdiction. Osborn v. U.S., 918 F.2d 724, 729, n. 6 (8th Cir. 1990). In a facial attack, the court restricts itself to the face of the pleadings and in a factual attack, the court considers matters outside the pleadings. Id. Under a facial ...


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