United States District Court, E.D. Missouri, Eastern Division
OPINION, MEMORANDUM AND ORDER
EDWARD AUTREY UNITED STATES DISTRICT JUDGE
diversity case is before the Court on the motions of
Defendant for summary judgment on Counts I, II, III, V, and
VII of the First Amended Complaint of Plaintiff; and the
Motion to exclude the expert testimony of Jed Grennan, [Doc.
No.'s 76, 96, and 94, respectively]. Plaintiff opposes
is a pharmacy benefits manager. In this role, Defendant
contracts with insurance carriers, health plan
administrators, and other third-party payors "to
facilitate delivery of prescription drugs to health plan
members or other beneficiaries." This facilitation is
effectuated, in part, by the creation of networks established
with various pharmacies that agree to fill prescriptions for
the members. Plaintiff was one such pharmacy. In May 2014,
Defendant entered into a Pharmacy Provider Agreement (the
"Agreement") with Plaintiff. This Agreement defined
"Pharmacy" as one which met its definition of
"Retail Provider": "[A] pharmacy that
primarily fills and sells prescriptions via a retail,
storefront location ...” A '"Retail
Provider' [did] not include mail order ... " Also,
Provider shall, and shall cause its personnel to, be bound by
and comply with the provisions of this Agreement and all
applicable laws, rules and regulations, including ...
applicable state boards of pharmacy's, other applicable
governmental bodies' laws, rules and regulations, and all
required federal, state and local licenses, certificates and
permits that are necessary to allow the Provider, the
Pharmacy, and pharmacist (as applicable) to dispense Covered
Medications to Members ... If the Provider "cease[d] to
be licensed by the appropriate licensing authority" or
if Defendant "determine[d] that the Provider was
dispensing Covered Medications in violation of any applicable
law, rule and/or regulation, " the Agreement could be
immediately terminated by Defendant. Defendant's Provider
Manual (the "Manual") is incorporated into the
Agreement and also requires the Provider to "maintain
valid non-resident licenses in all states to which it
mails/ships/delivers Covered Medications." If a Provider
violates any terms of the Agreement, including the Manual,
the Provider is deemed noncompliant and is subject to further
action, including termination, at Defendant's sole
Agreement authorized Defendant to audit a Provider and
allowed for the Provider to appeal any results. This audit
could include reviewing documentation verifying that the
Provider has pharmacy and pharmacist licenses,
"including licenses/permits/registrations required by
states in which legend prescriptions are
shipped/mailed." The initial audit report and a deadline
for appeal of such are given the Provider. After review by
the post-audit team, a final report and deadline for grieving
the report is given the Provider. Any discrepancies
identified are reviewed and any appropriate adjustments are
19, 2016, an auditor for Defendant conducted an audit of
Plaintiff. As a result of the audit, Defendant learned that
Plaintiff had shipped and/or delivered one or more
prescriptions into at least Louisiana, North Carolina,
Nebraska, Ohio, and Virginia. Plaintiff did not have
non-resident licenses for these states.
29, 2016 Defendant sent the initial audit results to
Plaintiff which detailed the claims that were mailed into
states in which Plaintiff was not licensed. The dates of the
prescriptions sent to states in which Plaintiff did not have
a license ranged from April 1, 2015 through May 15, 2016.
informed Plaintiff by letter of June 10, 2016 that Defendant
was terminating its Agreement with Plaintiff and, effective
July 18, 2016, would no longer consider Plaintiff to be a
member of Defendant's provider network. This letter cited
two reasons for the termination. First, Plaintiff had failed
to maintain its required status as a "Retail
Provider" and was instead primarily conducting a
mailorder business. Second, Plaintiff was "regularly
mailing drugs to members in states without the appropriate
licensure." Plaintiff does not dispute that it was
mailing drugs to states for which it had no active
non-resident license or that those states require such.
Rather, Plaintiff argues it was in the process of applying
for the needed licenses and it should have been, but was not,
given an opportunity to correct the lack of licenses.
Plaintiff further argues that the real reason for its
termination from the network was Defendant's desire to
gain market share by diverting high-priced pharmaceuticals to
a mail-order enterprise, Accredo Health Group, Inc.
("Accredo"),  that is a wholly-owned subsidiary of
seeks redress for Defendant's alleged (1) breach of the
Agreement by terminating Plaintiff from the network of
participating pharmacies (Count I); (2) breach of the implied
duty of good faith and fair dealing (Count II); (3) unjust
enrichment (Count III); and (4) breach of contract by failing
to pay Plaintiff monies owed (Count VII). Plaintiff also
seeks a declaratory judgment defining the parties' rights
and responsibilities under the Agreement (Count V).
seeks summary judgment on these five remaining counts.
Court may grant a motion for summary judgment if the movant
shows that there is no genuine dispute as to any material
fact and that the moving party is entitled to judgment as a
matter of law.” Fed.R.Civ.P. 56(a); Celotex Corp.
v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91
L.Ed.2d 265 (1986). The substantive law determines which
facts are critical and which are irrelevant. Only disputes
over facts that might affect the outcome will properly
preclude summary judgment. Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202
(1986). Summary judgment is not proper if the evidence is
such that a reasonable jury could return a verdict for the
nonmoving party. Id.
moving party always bears the burden of informing the Court
of the basis of its motion. Celotex, 477 U.S. at
323. Once the moving party discharges this burden, the
nonmoving party must set forth specific facts demonstrating
that there is a dispute as to a genuine issue of material
fact, not the mere existence of some alleged factual dispute.
Anderson, 477 U.S. at 247. The nonmoving party may
not rest upon mere allegations or denials of its pleadings.
Anderson, 477 U.S. at 256.
passing on a motion for summary judgment, the Court must view
the facts in the light most favorable to the nonmoving party,
and all justifiable inferences are to be drawn in its favor.
Anderson, 477 U.S. at 255. The Court's function
is not to weigh the ...