Wilkins v. Genzyme Corp.

93 F.4th 33

Trina WILKINS; James Bishop; Lisa Bishop; Amber Britton; Toni Cordova;John Cortina; Jill Cortina; George Demko; Dovan Helton; Mary Helton;Nate Brooks; Sydney Johnson; D.J.; Damon LaForce; Erin Masula;Michael Masula; James Matthews; Thomas Olszewski; Darlene Cookingham;Thomas Stanziano; Wendy Stanziano; Eddie Viers,individually as surviving spouse of Teresa Viers, deceased,and as personal representative of the Estate of Teresa Viers; William McNew;James Wallace; Jeanne Wallace, individually as surviving spouse of Joseph Wallace,deceased, and as personal representative of the Estate of Joseph Wallace;Samuel Wallace, Plaintiffs, Appellants, v. GENZYME CORPORATION, Defendant, Appellee.

No. 22-1782

United States Court of Appeals, First Circuit

February 15, 2024

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS, [Hon. Douglas P. Woodlock, U.S. District Judge]

Jonathan M. Gesk and C. Allen Black, Jr., with whom Law Office of C. Allen Black, Jr. and Gesk Moritz, LLC were on brief, for appellants.

Robert G. Jones, with whom Renee T. Whyte, Ezra D. Geggle, and Ropes & Gray LLP were on brief, for appellees.

Before Kayatta, Lynch, and Montecalvo, Circuit Judges.

KAYATTA, Circuit Judge.

Filed in February of 2020, this lawsuit seeks monetary recovery on behalf of more than two dozen individuals for injuries allegedly caused by drug manufacturer Genzyme Corporation's ("Genzyme") mishandling of a prescription drug shortage between 2009 and 2012. Given that eight to eleven years have passed between the events giving rise to this lawsuit and its commencement, the applicable statutory limitations periods would normally have rendered plaintiffs' claims fatally stale. Plaintiffs argue, however, that two prior putative class actions, a so-called savings statute, and a tolling agreement between the parties all align to bridge any gap that would otherwise have prevented this lawsuit from proceeding.

The district court agreed, at least in part, and rejected Genzyme's contention that the delay in filing this lawsuit required its dismissal under Rule 12(b)(6) of the Federal Rules of Civil Procedure. See Wilkins v. Genzyme Corp., No. 21-10023, 2022 WL 4237528, at *18 (D. Mass. Sept. 14, 2022). At the same time, the district court dismissed without prejudice the claims of all but four plaintiffs for lack of standing, and it dismissed with prejudice all remaining claims of those four plaintiffs on the merits. Id. at *19-31. All plaintiffs then timely appealed. For the reasons that follow, we vacate the district court's judgment in part and remand for further proceedings consistent with this opinion.

I.

Given the number of parties, claims, and issues in this lawsuit, a roadmap of our decision may prove helpful. The opinion commences with two threshold questions of justiciability -- Article III standing and subject matter jurisdiction. We conclude that all plaintiffs have standing and that this court has jurisdiction to proceed with this case, at least with respect to plaintiffs' individual claims.

We then turn to the district court's rejection of Genzyme's statute-of-limitations defense. Because Genzyme has not appealed that rejection, we can consider Genzyme's reliance on that defense on this appeal only to the extent it might serve as an alternative basis to affirm the judgment with respect to four plaintiffs whose claims were dismissed with prejudice. After unspooling plaintiffs' tolling-related arguments, we conclude that all four plaintiffs waited far too long before filing this lawsuit. In so concluding, we make a series of subsidiary findings that will guide the district court's treatment of the claims advanced by the remaining twenty-two plaintiffs.

As to the claims advanced by those plaintiffs, we conclude that the district court incorrectly dismissed those plaintiffs' claims for lack of standing. For that reason, we vacate the judgment dismissing those claims and remand the case to the district court. The district court can then decide, in whatever order it thinks prudent: (1) whether the claims withstand Genzyme's limitations defense as explicated in this opinion, and (2) whether the claims survive Genzyme's challenge to their merits under Rule 12(b)(6).

With this roadmap in hand, we start with the facts.

II.

We previously detailed the allegations that underpin this litigation in Hochendoner v. Genzyme Corp., 823 F.3d 724 (1st Cir. 2016) ("Hochendoner II"), so we provide only an abbreviated version here. Because of the preliminary procedural posture of this case, we summarize the facts as alleged by plaintiffs, rather than as they might otherwise be shown to be. See Germanowski v. Harris, 854 F.3d 68, 69 (1st Cir. 2017) ("Because this appeal follows a dismissal pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, we accept as true all well-pleaded facts in [the] complaint and draw all reasonable inferences in [plaintiffs'] favor.").

Genzyme makes what was at relevant times the only drug approved in the United States for treating Fabry disease, a progressive affliction that leads to destructive inflammation, organ failure, and premature death. Hochendoner II, 823 F.3d at 728. Genzyme's drug, called Fabrazyme, slows the progression of Fabry disease when administered at the proper dosage every two weeks. Id. During the relevant time period, Fabrazyme was the only FDA-approved treatment for Fabry disease in the United States.

From 2003 until 2009, Genzyme steadily provided the FDA-approved dosage of Fabrazyme to U.S. patients. Id. Then, in June 2009, upon discovering viral contamination in one of its facility's bioreactors, Genzyme suspended bulk production of Fabrazyme, leading to shortages. Id. at 728-29. Genzyme initiated a rationing plan, providing U.S. patients with reduced doses in order to prolong the drug's available supply. Id. In November 2009, Genzyme discovered particulate contamination in another batch of Fabrazyme, exacerbating the shortage. Id. at 728. In 2011, Genzyme worsened the shortage in the United States by diverting some Fabrazyme to the European market. Id. Plaintiffs aver that Genzyme did so to ward off competition from an alternative Fabry disease treatment approved only in Europe, while Genzyme's monopoly over the domestic market enabled the company to continue peddling reduced doses to U.S. Fabry patients without fear of losing market share.

It was not until after March 2012 that Genzyme succeeded in restoring full supplies of Fabrazyme to U.S. patients. In the meantime, U.S. patients had received reduced doses or, for a period in August 2011, no doses at all. Id. at 728-29. Plaintiffs variously allege that they experienced injuries as a result, including worsening symptoms and acceleration of the disease's progression, sensitization to the drug upon returning to a full dose, shortened life expectancies, and/or financial harm. They allege that Genzyme knew that low-dose Fabrazyme would not effectively treat Fabry disease and yet continued to sell the reduced doses to patients. They also allege that Genzyme knowingly misrepresented both the effectiveness of its low-dose regimen and the expected duration of the shortage.

The Fabrazyme shortage provoked several lawsuits against Genzyme that form the predicate for this case. In March 2011, a group of plaintiffs, on behalf of a putative class of all U.S. Fabry patients, brought suit in the U.S. District Court for the Western District of Pennsylvania, which transferred the case to the District of Massachusetts ("the Hochendoner lawsuit"). In June 2013, another group of plaintiffs, on behalf of a similar putative class, brought suit directly in the District of Massachusetts ("the Adamo lawsuit"). Both lawsuits alleged an array of common law and statutory claims against Genzyme. The district court consolidated the two lawsuits before dismissing both on the pleadings in March 2015. See Hochendoner v. Genzyme Corp., 95 F. Supp. 3d 15, 21, 35 (D. Mass. 2015).

On appeal, we concluded that the complaint failed to sufficiently allege a cognizable injury to any individual plaintiff to establish Article III standing, save for what the parties called a "sensitization" theory of injury as alleged by one of the Adamo plaintiffs named James Mooney (and his wife, Laura Kurtz-Mooney). Hochendoner II, 823 F.3d at 734-35. As to all plaintiffs but the Mooneys, "[u]tterly absent . . . [was] any allegation linking the . . . injuries to any specific plaintiff." Id. at 732. We therefore remanded the case so that the district court could adjudicate the Mooneys' sensitization-based claims, while dismissing without prejudice due to a lack of standing all other claims presented for review on that appeal. Id. at 735-37.

Thereafter, the parties engaged in settlement discussions. As part of that effort, the plaintiffs and Genzyme agreed, effective May 17, 2017, to toll "[a]ny applicable statutes of limitations pertaining to any matters asserted" during the Hochendoner and Adamo lawsuits ("Tolling Agreement"). While it seems that Genzyme ultimately reached agreement with some of the Hochendoner and Adamo plaintiffs -- including the Mooneys -- others remained unable to settle their claims. As a result, Genzyme terminated the Tolling Agreement effective February 29, 2020, the same day on which those plaintiffs filed the current lawsuit.

The twenty-six plaintiffs, almost all of whom were plaintiffs in the Hochendoner/Adamo lawsuits, filed the present action in the U.S. District Court for the Southern District of Indiana.¹ The case was transferred back to the District of Massachusetts. The new complaint asserts twenty-four counts of common law and statutory claims on behalf of the named plaintiffs and "all others similarly situated." Plaintiffs allege federal subject matter jurisdiction under the Class Action Fairness Act ("CAFA"), 28 U.S.C. § 1332(d), and supplemental jurisdiction over related claims under 28 U.S.C. § 1367. As we will discuss,...