Harris v. Auxilium Pharmaceuticals, Inc.

664 F.Supp.2d 711

Jan HARRIS, et al, individually and on behalf of others similarly situated, Plaintiffs, v. AUXILIUM PHARMACEUTICALS, INC., Defendant.

Civil Action No. 4:07-cv-3938.

United States District Court, S.D. Texas, Houston Division.

September 28, 2009.

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Scott David Newar, Attorney at Law, Houston, TX, for Plaintiffs.

A. Martin Wickliff, Jr., Charles Howard Wilson, Epstein Becker et al., Houston, TX, David S. Fryman, Farrah I. Gold, John Langel, Ballard Spahr Andrews & Ingersoll, LLP, Kelly T. Kindig, Philadelphia, PA, for Defendant.

MEMORANDUM AND ORDER

KEITH P. ELLISON, District Judge.

Before the Court are Plaintiffs' Motion to Certify Class (Doc. No. 54), Defendant's Motion to Extend Time to Respond to Plaintiff's Motion to Certify Class (Doc. No. 55), Defendant's Motion for Summary Judgment (Doc. No. 76), Motion to Strike Plaintiffs' Summary Judgment Evidence and for Sanctions (Doc. No. 85), and Defendant's Motion to Exceed Reply Page Limit (Doc. No. 87). After considering the parties' filings and the applicable law, the Court finds that Defendant's Motion to Strike and for Sanctions should be granted in part and denied in part, Defendant's Motion to Exceed Reply Page Limit should be granted, Defendant's Motion for Summary Judgment should be granted in part and denied in part, Plaintiffs' Motion for Conditional Class Certification should be denied as moot, and Defendant's Motion to Extend Time to Respond to Plaintiffs' Motion to Certify Class should be denied as moot.

I. BACKGROUND

This dispute arises out of Plaintiff Jan Harris's employment with Defendant Auxilium Pharmaceuticals, Inc. ("Auxilium").¹ Defendant is a specialty biopharmaceutical company that targets patient populations with unmet medical needs and focuses on developing and marketing to urologists, endocrinologists, orthopedists and select primary care physicians. (Susan Roberts Aff. ¶ 2, Doc. No. 77, Ex. A.) Defendant markets Testim 1% ("Testim"), a topical testosterone gel for the treatment of hypogonadism, and has several projects in clinical development. (Id. at ¶ 3.)

A. Medical Sales Consultants

Jan Harris began working for Defendant on or about January 29, 2003 as a Medical Sales Consultant ("MSC"). (Doc. No. 77, Ex. B1.) Kathy Parks began working for Defendant as an MSC on a part-time basis in December 2002.² Parks became a full-time MSC on February 1, 2003. (Parks Dep. 31, Feb. 2, 2009.)

MSCs are responsible for developing relationships with pharmacies and doctors in different therapeutic areas. (Id. at 43:1-19.) MSCs develop a rapport with physicians and office staff in order to gain and improve their access to the office. (Id. at 44:23-45:3.) MSCs must have good product knowledge of Testim in order to promote its features and benefits. (Id. at 45:25-46:3.) MSCs use sales data, provided by Defendant, and in some cases show it to physicians to increase sales. (Id. at 51.) They are required to bring promotional materials with them to the doctor's office, but they use these materials at their discretion. (Hatten Dep. 59:1-60:8, Jan. 13, 2009.) If a doctor has a medical question that is not addressed by Defendant's promotional materials, the MSC must direct the question to Defendant's Medical Affairs Department. (Id. at 64:22-25.) They bring "detail pieces" which are distributed by Defendant's marketing department, and Defendant recommends that the MSCs discuss the detail piece within the first ten seconds of their meeting with the physician. (Id. at 60:1-25.) MSCs are graded in their evaluations as to whether they satisfy this objective. (Id. at 62:6-16.) They are expected to discuss with the physician any problems he might have with Testim. (Id. at 50:11-17.)

MSCs "brand" the doctor's office by leaving pens and educational material after their calls. (Id. at 60:1-13.) It is a violation of Defendant's policies for MSCs to use unapproved materials to promote Testim. (Kessig Dep. 167-168, Jan. 20, 2009.) MSCs are also responsible for planning speaker programs once a month, picking a physician from an approved list and inviting certain physicians from their territories to attend. (Parks Dep. 72-74.)

MSCs are expected to "close the sale" by detailing the product, getting an agreement from the doctor to use the product, and then conclude with a "call for action" and follow-up. The doctor's commitment to use the product is not put into writing, and the doctor may chose not to take the agreed upon action once the MSC leaves the office. (Kessig Dep. 167-168.) MSCs cannot enter into binding contracts with the physicians or negotiate the purchase price for Testim. No money is exchanged when MSCs "close the sale." (Hatten Dep. 67:24-69:21.)

Defendant gives MSCs a list of physicians to contact, including the physician's specialty and demographic information. (Parks Dep. 34:1-9.) MSCs are restricted from seeing doctors other than those whose names Defendant provides. (Id. at 27:1-4.) MSCs also call on pharmacies to persuade them to stock Testim. (Id. at 26:12-13.) Defendant determines an MSCs territory, which encompasses the doctors and pharmacies she is required to visit.³ MSCs are required to live in the territory they are hired to serve. (Harris Dep. 55:19-56:5, Feb. 10, 2009.) The geographic size of the territories varies, but each has roughly the same number of doctors. (Id.) MSCs cannot call on doctors outside of their assigned territory. (Hatten Dep. 47:1-3.)

MSCs do not have an office—instead, Defendant provides them with a car or vehicle reimbursement, a laptop computer, and a Dell Axiom, a handheld computer. It is up to the MSC to decide where to conduct business. (Harris Dep. 22:14-17.) MSCs record on their handheld computers which physicians they visit and when. (Id. at 65:22-25.) Every quarter MSCs must provide their RSDs with "routing schedules" that break down their daily cycle of which doctors they will call on each day. These are "breathing documents" and MSCs do not have to follow them exactly (Hatten Dep. 54:18-23.) Defendant gives MSCs guidelines about the number of physicians they should visit and the percentage of doctors MSCs should visit in a particular amount of time. (Hatten Dep. 56:1-10.) MSCs are evaluated on their ability to satisfy these guidelines. (Id. at 57:5-9.) Defendant recommends that MSCs call on doctors prescribing the most Testim, and that they call on them at least once per week. (Hatten Dep. 52:11-52:25.) If an MSC fails to call on these doctors frequently, such failure could result in a lower field coaching report from her supervisor. (Id. at 53:16.) Furthermore, Defendant recommends that MSCs call on at least two pharmacies per week. (Id. at 54:6-10.) MSCs are paid incentive compensation and would receive contest awards based on the number of prescriptions that are written in their territory. (Parks Dep. 54:12-17.)

When she visited doctors, Harris would occasionally be accompanied by her Regional Sales Director ("RSD"), Jeffrey Hatten, or Mark Mosebrook, who worked in Defendant's corporate headquarters. (Harris Dep. 59-60; 21:6-12.) Most of the time Harris was working, however, she would visit doctors alone. (Id. at 59:14-15.) Sometimes Hatten would go months without accompanying Harris on her visits. (Id. at 62:12-15.) Harris did not keep track of how many hours per week she worked. (Id. at 62:21-25.) MSCs were advised, however, that it was "not a forty hour workweek" and that they should be in the field between 8:00 a.m. and 9:00 a.m., and that they should make their last call between 4:00 p.m. and 5:00 p.m. After driving home, Harris would sync her handheld computer, review emails, and occasionally do dinner programs or travel. (Id. at 63:1-15.) Harris estimates that she worked anywhere from sixty to seventy-five hours per week. (Id. at 67:1-8.) Her hours and work schedule varied from week to week. (Id. at 68:17-18.) Parks estimates that she worked anywhere from 60-70 hours per week, and she never reported to Defendant how many hours she worked in a particular week. (Parks Dep. 77:19-78:14.)

Harris understood her primary function to be to take the information she had received in training and deliver it to physicians. (Harris Dep. 21:21-24.) From time to time, MSCs are required to prepare a document entitled a "Monthly Business Summary." (Id. at 38:6-11.) The document has a section labeled "Significant Issues" in which the MSC, in consultation with her supervisor, discusses issues she is having in the field. (Id. at 38:18-39:10.) Harris's Monthly Business Summaries indicate that, in one instance, after bringing a particular physician coffee and learning from his staff that he liked it, Harris continued to bring him coffee. (Id. at 57:4-25.) Harris commented that another physician "will be a good thought leader if he can make time to speak." (Id. at 58:9-16.) The document indicates that, on occasion Harris would meet with particular physicians to discuss why they had stopped writing prescriptions for Testim. (Id. at 40:8-10.) Harris acknowledges that intelligence played some role in her success as an MSC, because "doctors can recognize if they are dealing with a person with some intelligence of some sort." (Id. at 178:14-17.) Harris claims that, in 2006, in the North Houston territory, she helped Defendant achieve a 31 percent market share. She acknowledges that this was due in part to her efforts and in part to the clinical trials and "detail pieces" she received from Defendant. (Id. at 183:14-18.) However, at one point in her deposition, Harris testified that her role was limited to "handing out pens and the table paper" that Defendant provided. (Id. at 184:22-25.)

Parks, in describing her calls, testified that she would usually walk into the doctor's office because she "had a very good rapport with doctors, and they knew me." She would tell them about the benefits of the drug, but she...