Jacksonville Police Officers and Fire Fighters Health Insurance Trust v. Gilead Sciences, Inc. ( 2022 )

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 JACKSONVILLE POLICE OFFICERS Case No. 20-cv-06522-JSW AND FIRE FIGHTERS HEALTH 8 INSURANCE TRUST, et al., ORDER GRANTING MOTION TO 9 Plaintiffs, STAY DISCOVERY v. Re: Dkt. No. 88 10 11 GILEAD SCIENCES, INC., et al., Defendants. 12 13 This matter comes before the Court upon consideration of the motion to stay discovery 14 filed by Defendants Gilead Sciences, Inc., Cipla, Ltd., and Cipla USA, Inc. (“Defendants”). The 15 Court has considered the parties’ papers, relevant legal authority, and the record in this case. The 16 Court concludes the motion is suitable for disposition without oral argument and VACATES the 17 hearing scheduled for December 9, 2022. The Court HEREBY GRANTS Defendants’ motion. 18 BACKGROUND 19 The Court recounted the facts underlying the parties’ dispute in its Order granting, in part, 20 and denying, in part, Defendants’ motion to dismiss the first amended complaint. See Jacksonville 21 Police Officers and Fire Fighters Health Insurance Trust v. Gilead Scis., Inc., No. 20-cv-6522- 22 JSW, 2022 WL 3579881, at *1-5 (N.D. Cal. Aug. 19, 2022). The Court concluded Plaintiff, 23 Jacksonville Police Officers and Fire Fighters Health Insurance Trust (the “Trust”), sufficiently 24 stated a claim under the Sherman Act based on allegations that Defendants entered into a “reverse 25 payment settlement.” Id., at *5-9. The Court dismissed the Trust’s state law claims, including a 26 claim under California’s Cartwright Act, for lack of standing, and it granted the Trust leave to 27 amend. Id., at *9-10. 1 dropped the Sherman Act claim and added a plaintiff identified as John Doe, who is a resident of 2 California. Plaintiffs maintain all of their state law claims and once again allege Defendants 3 entered into a reverse payment settlement. 4 ANALYSIS 5 Federal Rule of Civil Procedure 26(c) provides that a court may “for good cause, issue an 6 order to protect a party or person from annoyance, embarrassment, oppression, or undue burden or 7 expense” by, inter alia, forbidding discovery or by specifying terms, including time and place, for 8 disclosure or discovery. Fed. R. Civ. Proc. 26(c)(1)(A)-(B). The Court has discretion to stay 9 discovery pending the resolution of dispositive motions and motions to dismiss. See, e.g., Jarvis 10 v. Regan, 833 F.2d 149, 155 (9th Cir. 1987); see also Wood v. McEwen, 644 F.2d 797, 801 (9th 11 Cir. 1981) (good cause to stay discovery may exist where a court is “convinced that the plaintiff 12 will be unable to state a claim for relief”). “A party seeking a stay of discovery carries the heavy 13 burden of making a ‘strong showing’ why discovery should be denied.” Gray v. First Winthrop 14 Corp., 133 F.R.D. 39, 40 (N.D. Cal. 1990) (quoting Blankenship v. Hearst Corp., 519 F.2d 418, 15 429 (9th Cir. 1975)). “The moving party must show a particular and specific need for the 16 protective order, as opposed to making stereotyped or conclusory statements.” Id. (citations 17 omitted). 18 In determining whether to grant a protective order to stay discovery pending resolution of 19 dispositive motions, the Court considers the following two factors: (1) whether the pending 20 motion is potentially dispositive of the entire case, or at least dispositive on the issue at which 21 discovery is directed; and (2) whether the pending dispositive motion can be decided absent 22 additional discovery. The Pacific Lumber Co. v. National Union Fire Ins. Co. of Pittsburgh, PA, 23 220 F.R.D. 349, 352 (N.D. Cal. 2003) (internal citations omitted); see also In re Nexus 6p Prod. 24 Liab. Litig., No. 17-cv-2185-BLF, 2017 WL 3581188, at *1 (N.D. Cal. Aug. 18, 2017) (citing 25 cases). If a court concludes the answer to those two question is yes, it may issue a protective 26 order. Pac. Lumber Co., 220 F.R.D. at 352. “However, if either prong of this test is not 27 established, discovery proceeds.” Id. 1 discovery and, thus, there is “no issue at which discovery is directed.” However, given the nature 2 of the claims and the scope of Plaintiffs’ proposed class, the Court does not find this argument 3 persuasive. In addition, Defendants’ motion was prompted, in part, because the parties raised their 4 dispute about the need for discovery prior to resolution of the in their case management 5 conference statement. 6 The parties each assert that the agreements Defendants submitted with the motion to 7 dismiss strongly support their respective positions about whether a reverse payment settlement 8 exists. Plaintiffs also argue Defendants could have submitted the agreements with their first 9 motion to dismiss, and they urge the Court not to visit its previous ruling. The Court expresses no 10 opinion on the merits of the pending motion to dismiss, but after a preliminary review of the 11 motion and the opposition, the Court finds Defendants’ arguments are potentially dispositive. 12 Moreover, even if Defendants’ arguments regarding extraterritorial application of the Cartwright 13 Act does not result in an outright dismissal of that claim, it may significantly narrow the scope of 14 discovery. Accordingly, the Court concludes Defendants have satisfied the first prong of the test. 15 Although Plaintiffs argue that Defendants’ motion presents factual disputes that will 16 require discovery, they do not suggest the Court cannot resolve the motion to dismiss without the 17 benefit of discovery. Based on the Court’s preliminary review of the motion, it finds no discovery 18 is needed for resolution of Defendants’ motion to dismiss, and thus concludes that Defendants 19 have met their burden under the second prong of the test. 20 As discussed above, in light of the nature of the claims and the allegations about the 21 putative class, the Court concludes that Defendants have shown that a ruling on the motion could 22 also limit the scope of the discovery that would be necessary, reducing the burden or expense 23 imposed. The Court also concludes Plaintiffs would not be prejudiced by a stay of discovery 24 pending a ruling on Defendants’ motion to dismiss. The Court has not yet entered a scheduling 25 order and has continued the case management conference pending resolution of the motion to 26 dismiss. Thus, Plaintiffs will not suffer harm if the Court stays discovery pending the Court’s 27 ruling, which it will issue in a timely manner. ] Defendants motion to dismiss. 2 IT ISSO ORDERED. a) 3 || Dated: December 5, 2022 / } ( / 4 = JEBRREY) S/ WHIT 5 United spe Distryft Judge 7 8 9 10 11 12 13 14 15 16 17 © Z 18 19 20 21 22 23 24 25 26 27 28