BCBSM, Inc. et al v. Walgreen Co. et al

Filing 605

OPINION and Order signed by the Honorable Virginia M. Kendall on 11/22/2024. Additional Plaintiffs' Motion for Reconsideration 573 is denied. See Opinion for further details. Mailed notice(lk, )

THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
BCBSM, INC, (d/b/a BLUE CROSS and BLUE
SHIELD of MINNESOTA), HEALTH NEW
YORK, INC, HORIZON HEALTHCARE
SERVICES, INC. (d/b/a HORIZON BLUE
CROSS BLUE SHIELD OF NEW JERSEY),
BLUE CROSS AND BLUE SHIELD OF
ARIZONA, INC. (d/b/a BLUE CROSS BLUE
SHIELD OF ARIZONA and d/b/a AZBLUE),
ASURIS NORTHWEST HEALTH, et al.,
Plaintiffs,

v.

WALGREEN CO. and WALGREENS BOOTS
ALLIANCE, INC.,
Defendants and Third-Party Plaintiffs,
v.
PRIME THERAPEUTICS LLC,
Third-Party Defendant.

1

)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)
)

No. 20 C 1853
No. 20 C 1929
No. 20 C 3332
No. 20 C 4940
No. 20 C 4738
Chief Judge Virginia M. Kendall

OPINION AND ORDER
On August 21, 2024, this Court denied Initial Plaintiffs 1 and Additional 2 Plaintiffs’ Motion
for Leave to Amend Their Complaint to Conform to the Evidence. (Dkt. 571). Now, Additional
Plaintiffs move for reconsideration, arguing that the Court’s grounds for denying leave to amend
did not apply to them. (Dkt. 573). For the following reasons, Additional Plaintiffs’ Motion for
Reconsideration [573] is denied.
BACKGROUND
Though the Court assumes familiarity with the facts of this case from its previous Order,
(Dkt. 571 at 2), the procedural posture is complicated and bears repeating because it is relevant to
Additional Plaintiffs’ Motion. (See generally Dkt. 573). Initial Plaintiffs filed their Complaint in
August 2020 (Dkt. 1). After the Court granted in part Walgreen’s motion to dismiss, (Dkt. 121),
Initial Plaintiffs filed their Second Amended Complaint in January 2021. (Dkt. 122). Additional
Plaintiffs filed their Complaint in March 2022. (Dkt. 243). Because their cases involved the same
issues of fact and law as well as “similar discovery . . . and similar evidence,” Additional Plaintiffs
moved that same month to consolidate their suit with that of Initial Plaintiffs (Dkt. 243 at 6).

Initial Plaintiffs include the following parties: BCBSM, Inc. (d/b/a Blue Cross and Blue shield of Minnesota); HMO
Minnesota (d/b/a Blue Plus); Health Options, Inc. (d/b/a Florida Blue HMO); Blue Cross and Blue Shield of North
Carolina; Blue Cross Blue Shield of North Dakota; Blue Cross and Blue Shield of Florida, Inc. (d/b/a Florida Blue);
Blue Cross and Blue Shield of Alabama; Blue Cross and Blue Shield of Kansas, Inc.; Blue Cross and Blue Shield of
Massachusetts, Inc.; Blue Cross and Blue Shield of Massachusetts HMO Blue, Inc.; Wellmark, Inc. (d/b/a Wellmark
Blue Cross and Blue Shield and d/b/a Wellmark Blue Cross and Blue Shield of Iowa); Wellmark of South Dakota,
Inc. (d/b/a Wellmark Blue Cross and Blue Shield of South Dakota); Wellmark Health Plan of Iowa, Inc.; Wellmark
Synergy Health, Inc.; Wellmark Value Health Plan, Inc.; Blue Cross and Blue Shield of Arizona, Inc. (d/b/a Blue
Cross Blue Shield of Arizona and d/b/a AZBLUE); Blue Cross and Blue Shield of Kansas City, Inc.; HealthNow New
York, Inc.; Highmark Western New York, Inc. (f/k/a Blue Cross of Western New York); Northeastern New York
(f/k/a BlueShield of Northeastern New York); Horizon Healthcare Services, Inc. (d/b/a Horizon Blue Cross Blue
Shield of New Jersey); and Horizon Healthcare of New Jersey, Inc. (d/b/a Horizon NJ Health).

1

Additional Plaintiffs include the following parties: CareFirst of Maryland, Inc.; Group Hospitalization and Medical
Services, Inc.; CareFirst BlueChoice, Inc.; Blue Cross and Blue Shield of South Carolina; BlueChoice HealthPlan of
South Carolina, Inc.; Louisiana Health Service & Indemnity Company, d/b/a/ Blue Cross and Blue Shield of
Louisiana; and HMO Louisiana, Inc.

2

2

In July 2021, Walgreen filed a Third-Party Complaint (TPC) against Prime Therapeutics,
L.L.C. (“Prime”) for Contribution. (Dkt. 151). Prime is a pharmacy benefit manager (PMB) that
serves as an intermediary for certain Blue Cross-affiliated health insurance plans, including many
of Initial Plaintiffs’ plans, (Dkt. 227) and two of Additional Plaintiffs’ plans. (Dkt. 573). The Court
dismissed Walgreen’s TPC in February 2022, (Dkt. 217), and then granted in part Walgreen’s
motion to file an Amended TPC in April 2022 (one month after Additional Plaintiffs filed their
Complaint). (Dkt. 253). In the Court’s Order granting leave to file the Amended TPC, the Court
highlighted that some of Walgreen’s claims against Prime were futile because Initial and
Additional Plaintiffs had brought claims solely under intentional theories of tort liability requiring
scienter. (Id. at 4). This meant, as the Court explained in its ruling, that Prime could not be held
liable under Illinois laws that preclude tortfeasors (here, Walgreen allegedly) from seeking
contribution for intentional tortious conduct (here, intentional fraud asserted by Initial and
Additional Plaintiffs). (Id. at 3–4). Consequently, in April 2022, Walgreen amended its TPC but
excluded those claims, which were barred, against Prime. (Dkt. 259). In May 2022, the Court
granted Additional Plaintiffs thirty days to amend their Complaint after Walgreen moved to
dismiss on jurisdictional grounds. (Dkt. 360 at 15). Additional Plaintiffs did not to amend. (Dkt.
578 at 3).
In January 2023, Walgreen sent requests for admission (RFAs) to Initial Plaintiffs asking
them to admit whether they had “abandoned or declined to pursue claims based on reckless,
negligent, or otherwise unintentional conduct.” (See Dkt. 407). In overruling Initial Plaintiffs’
objections to the RFAs, Magistrate Judge Finnegan wrote: “Walgreen[] has shown a reasonable
need at this advanced stage of the case to know the scope of Plaintiffs’ claims for discovery and
pleading purposes” (Dkt. 453) (emphasis added). Initial Plaintiffs served their responses in July

3

2023. (Dkt. 561 at 6). These responses still did not answer whether Initial Plaintiffs were pursuing
claims beyond intentional fraud. (Id. at 7). When Walgreen served identical RFAs to Additional
Plaintiffs in September 2023, Additional Plaintiffs promptly served responses, but they were
similarly deficient and did not indicate what avenues of relief Additional Plaintiffs were pursuing.
(Id.) After Walgreen sent them a letter saying as much in May 2024, Additional Plaintiffs
supplemented their responses to correct the deficiencies. (Id. at 7).
In June 2024—more than two years after the Court’s April 2022 ruling (Dkt. 253) that state
law barred Walgreen’s contribution claims against Prime because the only allegations against them
were for intentional fraud—Additional Plaintiffs moved jointly with Initial Plaintiffs to amend
their Complaints to plead new scienter theories based on nonintentional conduct. (Dkt. 552). In
August 2024, the Court denied the motion, citing undue delay and prejudice. (Dkt. 571). Now,
Additional Plaintiff’s move for reconsideration arguing the Court’s previous order did not
sufficiently address their arguments.
LEGAL STANDARD
Motions for reconsideration under Rule 54(b) are generally disfavored and serve the
limited purpose of “bring[ing] to the Court’s attention a manifest error of law or fact or newly
discovered evidence.” Bordelon v. Chi. Sch. Reform Bd. of Trs., 233 F.3d 524, 529 (7th Cir. 2000).
Thus, “a motion to reconsider is only appropriate where a court has misunderstood a party, where
the court has made a decision outside the adversarial issues presented to the court by the parties,
where the court has made an error of apprehension (not of reasoning), where a significant change
in the law has occurred, or where significant new facts have been discovered.” Tapia-Rendon v.
United Tape & Finishing Co. Inc., 2024 WL 406513, at *2 (N.D. Ill. Feb. 2, 2024) (quoting
Broaddus v. Shields, 665 F.3d 846, 860 (7th Cir. 2011), overruled in part on other grounds by Hill

4

v. Tangherlini, 724 F.3d 965 (7th Cir. 2013)). The party seeking reconsideration “bears a heavy
burden,” and such motions “are not at the disposal of parties who want to ‘rehash’ old arguments.”
Patrick v. City of Chicago, 103 F. Supp. 3d, 907, 912 (N.D. Ill. 2015) (citation omitted); Caisse
Nationale de Credit Agricole v. CBI Indus., Inc., 90 F.3d 1264, 1270 (7th Cir. 1996). Thus, “a
proper motion to reconsider does more than take umbrage and restate the arguments that were
initially rejected.” Goings v. Brookman, 2023 WL 2989435, at *1 (S.D. Ill. Apr. 18, 2023) (citing
Cnty. of McHenry v. Ins. Co. of the W., 438 F.3d 813, 819 (7th Cir. 2006), as amended (Apr. 11,
2006)).
DISCUSSION
Additional Plaintiffs’ chief argument is that this Court’s Order, denying Initial and
Additional Plaintiffs’ motion to amend their complaints, was overbroad. (Dkt. 573 at 1). Additional
Plaintiffs argue that the Court’s rationale for denying the motion, principally that Plaintiffs delayed
without explanation and that the proposed amendments would result in expansive discovery efforts
and expenses, applies only to Initial Plaintiffs and not to Additional Plaintiffs. (Dkt. 573 at 2). The
Court disagrees.
Under Rule 15, a federal district court “should freely give leave [to amend] when justice
so requires” after the first amendment as a matter of course. Fed. R. Civ. P. 15(a)(2). “The Supreme
Court has interpreted [Rule 15] to require a district court to allow [an] amendment unless there is
a good reason—futility, undue delay, undue prejudice, or bad faith—for denying leave to amend.”
Life Plans, Inc. v. Sec. Life of Denver Ins. Co., 800 F.3d 343, 357–58 (7th Cir. 2015) (citing Foman
v. Davis, 371 U.S. 178, 182 (1962)); Zimmerman v. Bornick, 25 F.4th 491, 494 (7th Cir. 2022)
(“[A] court should deny leave to amend only if it is certain that amendment would be futile or
otherwise unwarranted.”). Undue delay can arise when a plaintiff seeks leave to amend “deep into

5

the litigation” where discovery is well underway or finished, or where the parties and Court have
already invested significant resources in refining the issues, such as multiple rounds of dispositive
motion briefing. McCoy v. Iberdrola Renewables, Inc., 760 F.3d 674, 687 (7th Cir. 2014). The
Court considers both the length of the delay and any reasons the movant offers to explain why the
delay occurred. Tamari v. Bache & Co. (Lebanon) S.A.L., 838 F.2d 904, 909 (7th Cir. 1988) (“The
longer the delay in seeking leave to amend, the likelier . . . both that the delay is
inexcusable . . . and that granting leave to amend will, by further delaying the lawsuit, impair the
public interest in the prompt resolution of legal disputes.”).
Additional Plaintiffs, therefore, put the Court in an unenviable position: evaluating, once
again, whether their delay was due to Additional Plaintiffs’ “legitimate ignorance,” lack of
diligence, or, worse, “procedural gamesmanship.” McCoy, 760 F3d at 687. Additional Plaintiffs
provide no explanation for why they waited two years to seek leave to amend their complaint.
Instead, Additional Plaintiffs merely highlight that at least they did not wait as long as Initial
Plaintiffs did. (Dkt. 573 at 1–2, 3). And while this is true (Initial Plaintiffs filed their complaint
two years earlier than Additional Plaintiffs), (Dkt. 1), this is a distinction without a meaningful
difference. The Court put both Initial and Additional Plaintiffs on notice that their pleading was
insufficient in April 2022—over two years prior to Plaintiffs jointly seeking to amend—when it
found that Initial Plaintiffs’ pleading failed to assert nonintentional scienter theories against
Walgreen. (Dkt. 253 at 4). In making its prior decision, the Court cited to Initial Plaintiffs’
allegations, which, for purposes of that portion of the ruling, were identical to the claims Additional
Plaintiffs made in its complaint against Walgreen. Compl., Carefirst of Md., Inc. v. Walgreen Co.,
No. 1:22-cv-01362 (N.D. Ill. filed Mar. 15, 2022), Dkt. 1. This makes Additional Plaintiffs’ failure
to even attempt to explain their delay more troubling. See Hindo v. Univ. of Health Sciences/The

6

Chicago Med. Sch., 65 F.3d 608, 615 (7th Cir. 1995) (“[a] denial is particularly warranted in
instances in which the plaintiff has failed to provide an explanation as to why the amendment did
not take place sooner.”); Feldman v. Allegheny Int’l, Inc., 850 F.2d 1217, 1226 (7th Cir. 1988)
(denying leave to amend where party “gave no explanation why this theory could not have been
alleged sooner . . . since the facts upon which it is predicated had been in the complaint all along”).
A month after explaining that Plaintiffs’ failure to plead nonintentional fraud foreclosed some of
Walgreen’s contribution claims against Prime, the Court gave Additional Plaintiffs the chance to
amend their Complaint. (Dkt. 360 at 15), an opportunity Additional Plaintiffs did not take.
Additional Plaintiffs’ failure to even attempt to offer an excuse for their delay weighed in favor of
denying Additional Plaintiffs’ motion for leave to amend.
Further, by failing to seek leave to amend even after Judge Finnegan granted Walgreen’s
Motion to Compel against Initial Plaintiffs, Additional Plaintiffs were, at the very least, not diligent
in pursuing the claims they seek to raise in the proposed amendment. (See Dkt. 561 at 4–6).
Additional Plaintiffs responded to Walgreen’s RFAs by refusing to answer questions based on
identical objections to the ones Judge Finnegan had previously overruled. (Dkt. 561 at 6). Not until
May 2024 did Additional Plaintiffs supplement their responses to the RFAs admitting that they
were pursuing fraud claims under nonintentional scienter theories, after Walgreen sent a letter
explaining Judge Finnegan had overruled those same objections when Initial Plaintiffs raised them.
(Id.; Dkt. 552 at 447). Thus, Additional Plaintiffs were content waiting for Walgreen to force them
to admit that they sought to plead new, different legal theories, while discovery had been ongoing
for at least 9 months (according to Additional Plaintiffs), (Dkt. 573 at 8), and as much as 18 months
(according to Walgreen) (Dkt. 578 at 10). Moreover, this undermines Additional Plaintiff’s claim
that they played no part in the discovery disputes between Walgreen and Initial Plaintiffs, (Dkt.

7

573 at 3), and, more importantly, shows that Additional Plaintiffs had no problem letting the case
drag on unnecessarily before seeking leave to amend.
Nevertheless, undue delay alone is typically “insufficient ground to warrant a denial of
leave to amend the complaint.” Dubicz v. Commonwealth Edison Co., 377 F.3d 787, 793 (7th Cir.
2004); see also George 8 v. Kraft Foods Global, Inc., 641 F.3d 786, 791 (7th Cir. 2011). Besides
undue prejudice and dilatory motives, Arreola v. Godinez, 546 F.3d 788, 796 (7th Cir. 2008),
another factor courts considers is whether the party’s proposed amendment would burden judicial
resources. Perrian v. O'Grady, 958 F.2d 192, 195 (7th Cir. 1992) (citations omitted) (“The burden
to the judicial system can justify a denial of a motion to amend ‘even if the amendment would
cause no hardship at all to the opposing party.’ ”); Tamari 838 F.2d 904 at 909 (“[T]he burden to
the judicial system from allowing parties to change theories in midstream is a pertinent factor and
may in appropriate cases justify a refusal to allow an amendment even if the amendment would
cause no hardship at all to the opposing party.”).
Here, the Court’s Order correctly emphasized that Additional Plaintiffs’ proposed
amendment would waste judicial resources and extend discovery. (Dkt. 571 at 4). Walgreen
previously underscored that whether Additional Plaintiffs are adding other theories of recovery
would inform Walgreen’s defense preparation. (Dkt. 561 at 5). According to Walgreen,
understanding the full scope of allegations leveled against them “[would] critically define and
narrow the issues for various matters and tasks—depositions, expert reports and testimony,
summary judgment briefing, jury instructions, trial evidence, and opening statements.” (Dkt. 407
at 14). Furthermore, Walgreen declared its document production substantially complete in
February 2024. (Dkt. 561 at 13). No doubt if the Court permitted Additional Plaintiff to “change

8

theories in midstream,” it would require expanding the scope of discovery, and expending
additional efforts and judicial resources. Tamari 838 F.2d 904 at 909.
Moreover, by expanding the scope of discovery this late, Additional Plaintiffs’ proposed
amendment would also unduly prejudice Walgreen, contrary to what they claim. (Dkt. 573 at 2).
With respect to Walgreen’s third-party contribution claims against Prime, Additional Plaintiffs
argue that, because only two Additional Plaintiffs worked with Prime for only two years, and
Walgreen has not sought to assert any claims against Prime pertaining to Additional Plaintiffs, the
issue of undue prejudice is “entirely irrelevant.” (Dkt. 573 at 3–4). While it may be true that
Walgreen has yet to file claims against Prime that relate to Additional Plaintiffs, this very well
could be because Additional Plaintiffs have not been given an opportunity to amend their
Complaint. If Additional Plaintiff are given such an opportunity, then the same prejudice argument
concerning Walgreen’s third-party contribution claims against Prime that applied to Initial
Plaintiffs would also apply here. (See Dkt. 561 at 14) (“if Plaintiffs’ Motion is granted, Walgreens
will need to seek leave to amend its third-party complaint against Prime, resulting in the parties
and the Court expending more resources.”). Though the Court acknowledges that Initial Plaintiffs’
proposed amendment would likely prejudice Walgreen more than Additional Plaintiffs’ proposed
amendment (both because Walgreen already abandoned its third-party contribution claims against
Prime and Initial Plaintiffs have more accounts with Prime than Additional Plaintiffs), this does
not excuse Additional Plaintiffs’ undue delay in seeking leave to amend and the undue prejudice
that the proposed amendment would nonetheless cause to Walgreen.
Finally, Walgreen correctly points out that motions for reconsideration “are not appropriate
vehicles” for generally “arguing issues or presenting evidence that [were or] could have been raised
during the pendency of the motion presently under reconsideration.” Anderson v. Holy See, 934

9

F.Supp.2d 954, 957 (N.D. Ill. 2013), aff’d sub nom. Anderson v. Catholic Bishop of Chicago, 759
F.3d 645 (7th Cir. 2014). Such is the case here. Additional Plaintiffs rehash very similar arguments
to ones they put forth in their Reply supporting the original motion for leave to amend. (See
generally Dkt. 563). Because Additional Plaintiffs reuse many of the arguments already raised in
their original motion for leave to amend, much of the Court’s analysis from its August 2024 Order
denying that motion also applies here. (Dkt. 571). Like in their original motion (Dkt. 552), here,
Additional Plaintiffs neither point to newly discovered evidence to explain their significant delay
in seeking leave to amend, nor do they offer any other explanation as to why they waited two years
to move to amend their Complaint to add their new scienter theories. (See Dkt. 573). Additional
Plaintiffs do not present any new case law or facts that would suggest this Court’s apprehension
of the issues in its original Order was mistaken. Accordingly, the Court finds no manifest error,
and its original ruling stands. The Court thus denies Additional Plaintiffs’ Motion for
Reconsideration. (Dkt. 573).
CONCLUSION
denied.

For the reasons stated above, Additional Plaintiffs’ Motion for Reconsideration [573] is

____________________________________
Virginia M. Kendall
United States District Judge
Date: November 22, 2024

10