Holwill v. Abbvie Inc.

Holwill v. Abbvie Inc.

Opinion

ORDER

Plaintiffs' motion for class certification [122] is granted. Lead Plaintiff Metzler Asset Management GmbH is appointed as a class representative [*3]  and Motley Rice, LLC is appointed as class counsel pursuant to Federal Rule of Civil Procedure 23(g). The Court declines to appoint Plaintiff Ironworkers National Pension Plan as a class representative at this time.

MEMORANDUM OPINION

Plaintiff, Mayuko Holwill, filed this putative class action against Defendants, Abbvie Inc., Richard A. Gonzalez, and William J. Chase, for violations of §§ 10(b) (against all Defendants) and 20(a) (against Gonzalez and Chase) of the Securities Exchange Act of 1934. Dkt. 74. The Court previously appointed Metzler Asset Management GmbH ("Metzler") as Lead Plaintiff and denied Defendants' motion to dismiss. Dkt. 64, 104. Metzler moves this Court to (1) certify this action as a class action pursuant to Rules 23(a) and 23(b)(3); (2) appoint Metzler and Plaintiff Ironworkers National Pension Plan ("Iron Workers") as co-class representatives; and (3) appoint Motley Rice LLC ("Motley Rice") as class counsel pursuant to Federal Rule of Civil Procedure 23(g). For the reasons set out below, the Court certifies this matter as a class action, appoints Metzler as a class representative, appoints Motley Rice as class counsel, but declines to appoint Iron Workers as a class representative at this time.

I. BACKGROUND

Plaintiffs allege that Defendants made false and misleading claims regarding the basis [*4]  for the success of Abbvie's sales of its flagship drug, Humira, which has accounted for more than half of AbbVie's yearly net revenues. Dkt. 74 at ¶¶ 3, 50-51. Between 2013 and 2018, Defendants made numerous statements attributing the growth and success of AbbVie's sales of Humira to its sales and marketing practices, representing that those practices and programs complied with laws regulating the sales and marketing of prescription medication. Dkt. 74 at ¶¶ 123-263. Plaintiffs allege that Defendants' statements were false or misleading because AbbVie's sales and marketing practices included an unlawful kickback scheme to bribe and influence physicians to prescribe Humira, which Defendants failed to disclose. Dkt. 74 at ¶¶ 1, 14. AbbVie's alleged unlawful sales and marketing scheme involved providing physicians with classic kickbacks like cash, meals, drinks, gifts, trips, and patient referrals to induce and reward Humira prescriptions. Dkt. 74 at ¶¶ 20-21, 109, 111. AbbVie also allegedly provided more sophisticated forms of kickbacks to physicians, including through AbbVie's Nurse Ambassador program, that encompassed assistance with marketing physicians' practices, proprietary medical [*5]  practice management software, administrative support on insurance and fulfillment issues, administration of Humira injections to patients, and training on self-administration. Dkt. 74 at ¶¶ 14-15, 20-21, 84-86, 89, 109-111.

The details of AbbVie's alleged kickback scheme became public starting in early 2018. Specifically, a federal qui tam action under the False Claims Act against AbbVie that focused on the Nurse Ambassador program was unsealed in March 2018 after the government declined to intervene. Dkt. 74 at ¶¶ 101, 103. A similar qui tam action in California state court initiated by the same relator became public on September 18, 2018 when the California Department of Insurance intervened and filed a publicly available superseding complaint including allegations concerning the same unlawful kickback schemes. Dkt. 74 at ¶¶ 105-07, 109-11, 314. AbbVie's stock price declined about 5% by the following day, September 19, 2018, Dkt. 74 at ¶¶ 313-15, including a 3% decline on September 18, 2018. Dkt. 74 at ¶ 317.

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