First Circuit affirms summary judgment against relator in Ortho Biotech case

by Ben Vernia | June 26th, 2013

On June 12, the Court of Appeals for the First Circuit ruled in U.S. ex rel. Duxbury v. Ortho Biotech Prods., L.P. that the district court properly limited discovery and granted summary judgment in the case, which alleged kickbacks in the sale and promotion of Procrit, a drug approved for treating anemia.

In 2008, the First Circuit had largely affirmed the dismissal of most of the relator’s case, finding that the allegations had been publicly disclosed and that the relator was an original source only as to a short time period and a handful of hospitals’ claims. (The appeals court had reversed the district court, however, on the complaint’s sufficiency under Rule 9(b).)

On remand, the district court limited discovery to an eight-month period and eight hospitals, and rejected the relator’s argument that he had alleged a nationwide scheme. At the close of discovery, the relator stipulated that she (the original relator’s wife had been substituted for him after his death) did not possess any admissible evidence to support her allegations, as limited by the court. The district court granted summary judgment for the company, and the relator appealed.

The First Circuit noted that the relator’s argument focused on the district court’s limitation of discovery, which she argued contradicted the Court of Appeals’ earlier order. The Court disagreed, noting that the only claims remaining after its original order were the accounts the original relator had handled as an employee of the defendant. Since the discovery limitation was consistent with the first decision, the summary judgment derived from the parties’ stipulation was likewise within the district court’s discretion.

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