United States District Court, District of Columbia
IN RE LORAZEPAM & CLORAZEPATE ANTITRUST LITIG.
MYLAN LABS., INC., Defendants. HEALTH CARE SERV. CORP., Plaintiff, BLUE CROSS BLUE SHIELD OF MINN., BLUE CROSS BLUE SHIELD OF MASS., and FEDERATED MUT. INS. CO. Plaintiffs,
MYLAN LABS., INC., et al., Defendants. Misc. No. 99-276 (TFH) Civil Action Nos. 01-2646 (TFH), 02-1299 (TFH)
F. Hogan, Senior United States District Judge
remand from the D.C. Circuit on jurisdictional grounds, the
Court determined that nondiverse plaintiffs could be
dismissed from this action pursuant to Rule 21 of the Federal
Rules of Civil Procedure. See In re Lorazepam &
Clorazepate Antitrust Litig., 900 F.Supp.2d 8 (D.D.C.
2012). As a result, the plaintiffs have dismissed the claims
of 775 self-funded customers who are either nondiverse from
the defendants or whose citizenship could not be determined.
See In re Lorazepam & Clorazepate Antitrust
Litig., 62 F.Supp.3d 38 (D.D.C. 2014). The plaintiffs
have met their burden to establish diversity jurisdiction
over all of the remaining self-funded customers, see
id., and the only issue that remains to be decided is
whether the Court must conduct a partial retrial on damages
or whether it can enter a remittitur for the portion of the
damages attributable to the dismissed parties. After careful
consideration, and for the reasons detailed below, the Court
concludes that remittitur is appropriate so Plaintiffs'
Joint Motion for Remittitur [ECF No. 1051] shall be granted.
action arose from alleged antitrust violations resulting from
exclusive licensing agreements among the defendant
pharmaceutical drug manufacturers and pharmaceutical drug
ingredient manufacturers. See Third Am. Compl. [ECF
No. 1066]; Fourth Am. Compl. [ECF No. 1050]. The named
plaintiffs - Blue Cross Blue Shield of Minnesota
("BCBS-MN"), Blue Cross Blue Shield of
Massachusetts ("BCBS-MA"), Health Care Service
Corporation ("HCSC"), and Federated Mutual
Insurance Company ("Federated") - are four health
insurance companies that sued on behalf of themselves and as
claims administrators for their self-funded customers.
See Third Am. Compl. 2; Fourth Am. Compl. 2.
before trial, the defendants challenged the plaintiffs'
authority to sue on behalf of their self-funded customers.
See Defs.' Mot. in Limine to Preclude Evidence
of Pl's.' Claims on Behalf of Their Self-Funded
Customers [ECF No. 680]. The Court found that the insurance
companies were not the real parties in interest with respect
to the claims for damages suffered by their self-funded
customers, see Order (Mar. 7, 2005) [ECF No. 745],
but it allowed the plaintiffs to seek ratification from their
self-funded customers pursuant to Rule 17 of the Federal
Rules of Civil Procedure, see Order (Apr. 25, 2005)
[ECF No. 821]. Five self-funded customers opted out during
the ratification process. See Defs.' Mot. for
Remittitur Under Rule 59(e) and Mem. in Support Thereof Ex.
B, Gilde Decl. ¶ 3 [ECF No. 890-3] and Ex. C, Skwara
Decl. ¶ 3 [ECF No. 890-4].
remaining claims proceeded to trial. On June 1, 2005, the
jury found in favor of all plaintiffs and against all
defendants and awarded each plaintiff the precise amount of
damages calculated by Dr. Atanu Saha, the plaintiffs'
economic antitrust expert. See Verdict Form 4 [ECF
No. 875]; see also Trial Tr. 14:9-16, 40:18-41:10
May 12, 2005 (PM); PEX 5002 ("Annual Summary of Damages
by Plaintiff). The Clerk entered Judgments on the Verdict
against the defendants in favor of plaintiffs Blue Cross Blue
Shield ("BCBS") of Massachusetts [ECF No. 877],
BCBS of Minnesota [ECF No. 878], Health Care Service
Corporation ("HCSC") [ECF No. 879], and Federal
Mutual Insurance Company [ECF No. 880].
the resolution of extensive post-trial motions, on January
24, 2008, the Court granted the plaintiffs' motions for
treble damages and granted in part the defendant's motion
for remittitur under Rule 59(e). In re Lorazepam &
Clorazepate Antitrust Litig., 531 F.Supp.2d 82 (D.D.C.
2008). The Clerk entered an updated Judgment in a Civil Case
[ECF No. 947] to reflect the amended damages awards, and the
defendants appealed, see Notices of Appeal [ECF Nos.
956, 957]. On July 16, 2009, the Court adopted Magistrate
Judge Kay's Report and Recommendation granting BCBS-MA,
BCBS-MN, and Federated's Motion to Amend the Judgment to
Include Prejudgment Interest, see Order (July 16,
2009) [ECF No. 999], so the defendants filed Amended Notices
of Appeal on July 31, 2009, see Amended Notice of
Appeal [ECF Nos. 1000, 1001].
days prior to oral argument before the D.C. Circuit, the
defendants filed a motion to dismiss for lack of subject
matter jurisdiction, asserting that at least one self-funded
customer shared a state of citizenship with at least one
defendant. See Motion to Dismiss, In re
Lorazepam, No. 08-5044 (D.C. Cir. Oct. 3, 2010). The
Circuit rejected the plaintiffs' argument that the Court
had supplemental jurisdiction over the self-funded
customers' claims and held that the "self-funded
customers must be counted as parties for diversity of
citizenship purposes." In re Lorazepam, 631
F.3d 537, 540 (D.C. Cir. 2011). Because the pleadings lacked
citizenship allegations for the self-funded customers, the
Circuit remanded the case for an inquiry into the citizenship
of the self-funded customers and a determination of whether
any self-funded customers could be dismissed under Federal
Rule of Civil Procedure 21. Id. at 542. The Circuit
noted that "[s]ince this may also affect damages, the
district court may have to conduct a partial retrial
on that issue." Id. (emphasis added).
remand, the Court held that nondiverse self-funded customers
could be dismissed under Rule 21 of the Federal Rules of
Civil Procedure and denied the defendants' motion to
dismiss for lack of subject matter jurisdiction. In re
Lorazepam & Clorazepate Antitrust Litig., 900
F.Supp.2d 8 (D.D.C. 2012). The plaintiffs have now dismissed
over half of the self-funded customers from the lawsuit - 775
out of 1, 387 - because they are either nondiverse from one
defendant or their citizenship cannot be determined. See
In re Lorazepam, 62 F.Supp.3d 38 (D.D.C. 2014); see
also Third Am. Compl. [ECF No. 1066]; Fourth Am. Compl.
[ECF No. 1050]. Because the jury's verdict included
damages awarded to these dismissed self-funded customers, the
Court must now decide whether a partial retrial on damages is
required or whether it is appropriate to enter a remittitur.
general, remittitur is a practice by which a trial court can
require a party to choose between reduction of an excessive
damages award and a new trial. When a court determines that a
verdict is excessive because it is more than a reasonable
jury could have awarded based on the evidence presented at
trial, the court must give the parties the option of a new
trial in order to avoid impinging on their Seventh Amendment
rights. See, e.g., Langevine v. District of
Columbia, 106 F.3d 1018, 1024 (D.C. Cir. 1997)
(explaining that because "the Seventh Amendment right to
a jury pervades the realm of jury verdict decisions ... [a]
court must be especially hesitant to disturb a jury's
determination of damages in cases involving intangible or
non-economic injuries."). But when "it is apparent
as a matter of law that certain identifiable sums were
included in the verdict that should not have been there,
" it is appropriate for a district court to enter a
remittitur and correct the verdict without further jury
proceedings. See Carter v. District of Columbia, 795
F.2d 116, 134 (D.C. Cir. 1986) (quoting 11 Charles Alan
Wright and A. Miller, Federal Practice and
Procedure, § 2815, at 99 (1973)). Therefore, if a
"jury's assessment of damages includes an
impermissible component that can be identified and calculated
with precision, " the court can enter a remittitur
without encroaching on the parties' rights, and a new
trial is not required. Carter, 795 F.2d at 134.
parties agree that the damages awarded to the nondiverse
self-funded customers should not have been included in the
jury's verdict because the Court did not have
jurisdiction over those claims. The issue, then, is whether
that "impermissible component" of the verdict can
be "identified and calculated with precision" such
that it is appropriate for the Court to enter a remittitur,
or whether a new trial on damages is required.
defendants claim that a new trial is required because
"there is no basis whatsoever to separate out the
damages for any or all of the self-funded plaintiffs."
Defs.' Resp. to Pl's.' Mot. for Remittitur 15
[ECF No. 1031 ]. But the record in this case establishes a
clear basis for disaggregating the damages of the dismissed
self-funded customers - a basis the defendants fervently
advocated for earlier in this litigation. Shortly after
trial, in June 2005, the defendants filed a motion requesting
remittitur of portions of the damages awards for several
reasons, one of which was that the claims of five self-funded
customers that had opted out of the litigation were
erroneously included in the final damages award. See
Defs.' Mot. for Remittitur Under Rule ...