MATTHEW ENRIQUEZ, ETC. VS. JOHNSON & JOHNSON (L-4677-18, CAMDEN COUNTY AND STATEWIDE) ( 2021 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-1174-19
MATTHEW ENRIQUEZ,
individually and on behalf
of all others similarly situated,
Plaintiff-Appellant,
v.
JOHNSON & JOHNSON,
JANSSEN PHARMACEUTICALS,
INC., ACTAVIS PHARMA, INC.,
and ACTAVIS LLC,
Defendants-Respondents.
Argued October 21, 2021 – Decided November 12, 2021
Before Judges Alvarez, Haas, and Mawla.
On appeal from the Superior Court of New Jersey, Law
Division, Camden County, Docket No. L-4677-18.
J. Michael Connolly (Consovoy McCarthy, PLLC) of
the Virginia and District of Columbia bars, admitted
pro hac vice, argued the cause for appellant (Joshua M.
Neuman, Tobias L. Millrood and Gabriel C. Magee
(Pogust Millrood, LLC), J. Michael Connolly, William
S. Consovoy (Consovoy McCarthy, PLLC) of the
Virginia and District of Columbia bar, admitted pro hac
vice, Ashley C. Keller (Keller Lenkner LLC) of the
Illinois bar, admitted pro hac vice, and Travis Lenkner
(Keller Lenkner, LLC) of the Illinois bar, admitted pro
hac vice, attorneys; Joshua M. Neuman, Tobias L.
Millrood, Gabriel C. Magee, Kyle N. Thompson
(Kilcoyne & Nesbitt, LLC), Ashley C. Keller, Travis
Lenkner and William S. Consovoy, on the briefs).
Jonathan P. Schneller (O'Melveny & Myers LLP) of the
California bar, admitted pro hac vice, argued the cause
for respondents (Jonathan P. Schneller and Calcagni &
Kanefsky, LLP, attorneys for Johnson & Johnson and
Janssen Pharmaceuticals, Inc.; Morgan, Lewis &
Bockius, LLP, attorneys for Actavis Pharma, Inc. and
Atavis LLC; Eric T. Kanefsky, Walter R. Krzastek,
Martin B. Gandelman, Harvey Bartle, IV, Mark Fiore
and Brian M. Ercole, on the joint brief).
PER CURIAM
Plaintiff Matthew Enriquez appeals from an October 10, 2019 order
dismissing his complaint with prejudice pursuant to Rule 4:6-2(e). We affirm.
In December 2018, plaintiff filed a class action suit against defendants
Johnson & Johnson, Janssen Pharmaceuticals, Inc., Actavis Pharma, Inc., and
Actavis LLC. The proposed class was defined as "[a]ll current New Jersey
citizens (including natural persons and entities) who purchased health insurance
policies in New Jersey from 1996 through the present; and all current New
Jersey citizens who paid for any portion of employer-provided health insurance
from 1996 through the present." The complaint asserted causes of action for:
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violation of the New Jersey Consumer Fraud Act (CFA), N.J.S.A. 56:8-1
to -226; public nuisance; unjust enrichment; negligence; and negligent
interference with prospective economic advantage. 1
The complaint alleged defendants fueled the opioid crisis in New Jersey,
causing insurance companies to pay the costs of opioid medication and addiction
treatment for their insureds, which increased premiums, co-pays, and
deductibles for plaintiff and the other class members. It asserted defendants
"manufacture[d], market[ed] and [sold] prescription opioids, . . . [and] engaged
in a . . . deceptive marketing scheme to encourage doctors and patients to use
opioids to treat chronic pain." It further claimed defendants "falsely minimized
the risks of opioids, [and] overstated their benefits and generated far more opioid
prescriptions than there should have been." Defendants allegedly represented
that opioid addiction could be treated through use of opioids, misrepresented the
signs of addiction, and suggested tapering or increasing opioid use as a valid
means of treatment. Plaintiff asserted "[d]efendants knew that their
misrepresentations about the risks and benefits of opioids were not supported
by, and sometimes were directly contrary to, the scientific evidence."
1
Plaintiff has not appealed the dismissal of the negligent interference with
prospective economic damage count.
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The complaint alleged "[d]efendants devised a scheme to misrepresent the
risks and benefits of opioids to increase prescriptions by tapping into the large
and lucrative market for chronic-pain patients." Further, defendants
disseminated false and misleading information through: continuing medical
education programs; advertisements targeting medical professionals and the
public; websites; and direct sales and promotional communications with doctors
and chronic-pain patients.
According to plaintiff, "[d]efendants created, funded, controlled, and
operated third-party organizations that communicated directly with doctors and
chronic-pain patients to promote opioid use generally without naming specific
brands . . . [giving] the false appearance that the deceptive messages came from
an independent and objective source." Third-party groups aided "[d]efendants
by responding to negative articles, advocating against regulatory changes that
would limit opioid prescriptions, and conducting outreach to vulnerable patient
populations targeted by the [d]efendants." The complaint also alleged
defendants recruited highly qualified medical professionals to spread
misinformation "about the risks and benefits of opioids and other pain-treatment
options." These individuals "purported to act independently," thereby
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"lend[ing] legitimacy to the [d]efendants' false and misleading claims about
opioids."
Defendants allegedly falsely claimed "opioids produce positive long-term
outcomes in cases of chronic pain[,]" and misrepresented the risks of competing
non-opioid pain-relief products, "so that doctors and patients would favor
opioids for treatment of chronic pain." The complaint asserted defendants
unlawfully targeted susceptible providers and vulnerable populations.
Defendants moved to dismiss the complaint for failure to state a claim.
Judge Steven J. Polansky heard oral argument on the motion. Plaintiff's counsel
explained causation and damages would be proved by an expert's estimate of the
likely percentage of improperly written prescriptions and the resulting cost of
opioid addiction treatment, based on statistics from a sample of opioid
prescriptions. The expert would then calculate the corresponding increase in
health insurance costs.
The judge granted the motion to dismiss, finding the CFA claim could not
stand because "[d]efendants had no contact with [p]laintiff, and did not make
any misrepresentations or omissions to [him]." Even if the plaintiff's allegations
were true, the judge found several "links of causation separate [d]efendants'
actions from plaintiff's alleged injury[.]" He enumerated the links as follows:
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1) defendants' manufacturing and marketing to prescribers and patients; 2)
doctors prescribing the opioids; 3) patients using, abusing, and becoming
addicted to the opioids; 4) plaintiff's insurer reimbursing patients for the drugs
and addiction-related costs; and 5) plaintiff's insurer increasing premiums due
to opioid use.
The judge also concluded plaintiff's theory of recovery was "speculative
and attenuated." He found plaintiff could not "establish an ascertainable loss
through statistical data" because it was "essentially a fraud on the market theory
which has been rejected as a basis to establish an ascertainable loss" by our
Supreme Court. See Int'l Union of Operating Eng'rs Local No. 68 Welfare Fund
v. Merck & Co., 192 N.J. 372, 392 (2007) (rejecting the use of fraud on the
market theory to prove insurers paid increased costs for Vioxx because of the
defendant's fraudulent marketing campaign).
The judge concluded it was "highly impracticable" to claim insurance
premiums increased due to opioids because
[t]here are a myriad of reasons, independent of the
opioid epidemic, which have an impact on insurance
costs. Some costs may be borne by insurers resulting
in lower profits, some may be paid by employers[,] and
some may be passed on to the purchasers of health
insurance. These costs may also be subject to higher
co-pays, deductibles or limitations of coverage.
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As to both his CFA and public nuisance claims, plaintiff argued his case
was similar to James v. Arms Technology, Inc., 359 N.J. Super. 291 (App. Div.
2003). In James, several cities and counties sued gun manufacturers alleging
they "intentionally or negligently created and fueled an illegal gun market,
thereby unreasonably interfering with the public welfare, knowing, or having
reason to know, that their conduct has a significant effect upon a public right."
Id. at 332 (citing Restatement (Second) of Torts § 821B (Am. Law Inst. 1979)).
We affirmed the denial of defendant's motion to dismiss noting a "public
nuisance may exist[] if the conduct complained of involves a 'significant
interference' with the public welfare or 'is of a continuing nature or has produced
a permanent or long-lasting effect, and, as the actor knows or has reason to
know, has a significant effect upon the public right.'" Id. at 330 (quoting
Restatement (Second) of Torts at § 821B(2)(a) and (c)).
The judge dismissed plaintiff's public nuisance count. He reasoned such
claims should be "brought by a governmental entity or an individual who
sustains some special damage over and above that suffered by the general
public" and the complaint failed to meet either criterion.
He also dismissed the unjust enrichment claim, finding "[p]laintiff can
point to no direct benefit received by any [d]efendant from [p]laintiff. Rather,
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any benefit [p]laintiff conferred was directed to his health insurer. The facts
presented are far too remote to permit a cause of action based upon unjust
enrichment to proceed."
The judge also concluded the negligence claim was not viable because
defendants owed no duty of care to plaintiff. He stated: "The nature of the risk
to consumers of health insurance is too far removed [from defendants' conduct],
and any risk too attenuated, to find as a matter of fairness that a duty should
extend to such outer limits."
We review "de novo the trial court's determination of the motion to
dismiss under Rule 4:6-2(e)." Dimitrakopoulos v. Borrus, Goldin, Foley,
Vignuolo, Hyman and Stahl, P.C., 237 N.J. 91, 108 (2019) (citing Stop & Shop
Supermarket Co. v. Cnty. of Bergen, 450 N.J. Super. 286, 290 (App. Div. 2017)).
We "search[] the complaint in depth and with liberality to ascertain whether the
fundament of a cause of action may be gleaned even from an obscure statement
of claim . . . ." Printing Mart-Morristown v. Sharp Elecs. Corp., 116 N.J. 739,
746 (1989) (quoting Di Cristofaro v. Laurel Grove Mem'l Park, 43 N.J. Super.
244, 252 (App. Div. 1957)). We "accept the truth of [a] plaintiff's allegations
and, also, give [the] plaintiff the benefit of all reasonable factual inferences ."
Perkins v. DaimlerChrysler Corp., 383 N.J. Super. 99, 110-11 (App. Div. 2006).
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Our review "is limited to examining the legal sufficiency of the facts alleged on
the face of the complaint[,]" and we do not concern ourselves with a plaintiff's
ability to prove the allegations. Printing Mart, 116 N.J. at 746.
Having conducted our review pursuant to these principles, we affirm
substantially for the reasons set forth in Judge Polansky's thorough and well-
written opinion. We add the following comments.
Plaintiff's reliance on James to support the viability of his CFA claim
based on a fraud on the market theory of causation is misplaced. The James
plaintiffs asserted negligence, product liability, public nuisance, and unjust
enrichments claims; they did not assert a CFA claim. 359 N.J. Super. at 304.
Moreover, James is inapposite because plaintiff and the putative class are private
as opposed to public entities.
Plaintiff asserts James supports his public nuisance claim and his overall
theory of causation, which was based on the hypothetical effects of defendants'
conduct on insurance costs and premiums. This argument is likewise unavailing.
In In re Lead Paint Litigation, the Supreme Court affirmed dismissal of the
plaintiffs' complaint against manufacturers of lead paint for failure to state a
claim for public nuisance. 191 N.J. 405, 440 (2007). Writing for the majority,
Justice Hoens explained:
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A public entity proceeding in public nuisance
vindicates the common right and thus pursues . . . civil
actions to abate the nuisance . . . [whereas a] private
plaintiff . . . does not necessarily sue to vindicate a
public right, but seeks recompense for damages to the
extent of the special injury sustained, apart from the
interference with the public right.
[Id. at 434.]
A "special injury has a specific and well-defined meaning in public nuisance
jurisprudence. It must be an injury different in kind, rather than in degree." Id.
at 436. The Court held dismissal of the complaint was proper because it did not
establish "the requisite connection between damages and special injury." Id. at
435 n.10.
Plaintiff's complaint did not establish a special injury. The complaint
averred "[p]rescription opioids have devastated communities across the country
and in the State of New Jersey . . . [and] some estimates state that the opioid
crisis is costing governmental entities and private companies as much as $500
billion per year." Accepting this claim as true, it is evident the public nuisance
claim could not survive dismissal because plaintiff did not assert a different kind
of injury but instead the degree of the injury, namely, the increase in insurance
premiums and costs.
Affirmed.
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