Kadambi et al v. Express Scripts Inc et al

Filing 79

OPINION AND ORDER DENYING 54 MOTION for Preliminary Injunction by Plaintiffs Linda Hinant, Nancy Hunt, Ashok Kadambi, Sharon Yost. Plaintiffs have leave to refile the Motion; GRANTING 62 MOTION for Judgment on the Pleadings as to Count I by Defen dants Accredo Health Group Inc, Express Scripts Holding Company, Express Scripts Inc, Medco Health Solutions Inc. Judgment is entered in favor of Defendants on Count I; GRANTING IN PART and DENYING IN PART 64 MOTION to Dismiss Defamation Claims (Co unts II and III) Pursuant to Indiana's Anti-SLAPP Act, Ind. Code Sections 34-7-7-1 et seq. by Defendants Accredo Health Group Inc, Express Scripts Holding Company, Express Scripts Inc, Medco Health Solutions Inc. Count III is DISMISSED WITHOUT P REJUDICE for failure to state a claim. Plaintffs GRANTED leave to file, within thirty (30) days of this decision, an Amended Complaint consistent with this Opinion and Order. Signed by Judge Jon E DeGuilio on 2/5/15. (cer). Modified text on 2/5/2015 to reflect that Count III, rather than Count II, is dismissed. (cer)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF INDIANA
FORT WAYNE DIVISION
ASHOK KADAMBI, M.D., et al.,
Plaintiffs,
v.
EXPRESS SCRIPTS, INC., et al.,
Defendants.

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Case No. 1:13-CV-321 JD

OPINION AND ORDER
This case arises from a dispute regarding the fulfillment of prescriptions for HGH,
written by plaintiff Dr. Ashok Kadambi. The other plaintiffs are eight of his patients, for whom
the prescriptions were written. The plaintiffs claim that the defendants—several mail-order
pharmacies—are liable for failing to fulfill the prescriptions as written. Plaintiffs’ currently
operative Amended Complaint [DE 58] alleges three claims: Breach of Duty to Honor
Prescription (Count 1); Defamation (Count II); and Breach of Settlement Agreement (Count III).
Now before the Court are two motions in which the defendants seek to have each of the claims
dismissed: (1) Defendants’ Motion for Judgment on the Pleadings as to Count I [DE 62] and (2)
Defendants’ Motion to Dismiss Defamation Claims (Counts II and III) Pursuant to Indiana’s
Anti-SLAPP Act [DE 64].1
For the reasons stated below, the Motion for Judgment on the Pleadings as to Count I is
GRANTED [DE 62] and the Motion to Dismiss Defamation Claims (Counts II and III) Pursuant
to Indiana’s Anti-SLAPP Act is GRANTED IN PART and DENIED IN PART [DE 64].

1

Also pending is a Motion for Preliminary Injunction, filed by the plaintiffs. [DE 54.] Briefing on that motion has
been stayed pending a decision on the two motions addressed in this opinion. As discussed more fully below, in light
of the resolution of the other pending motions, the Court denies the Motion for Preliminary Injunction without
prejudice.

I.

Factual Background

Dr. Kadambi is a physician specializing in Endocrinology in Fort Wayne, Indiana. For at
least eight of his patients, who are plaintiffs in this lawsuit, Dr. Kadambi prescribed human
growth hormone (“HGH”). The plaintiffs allege that the prescriptions were “independently
evaluated and determined to be medically necessary for each patient” and that the prescriptions
were approved by the insurance companies of the patients. However, starting in 2010, the
defendant pharmacies began refusing to honor the HGH prescriptions from Dr. Kadambi.
Plaintiffs also claim that representatives from defendant Accredo made defamatory statements to
several of the plaintiffs regarding Dr. Kadambi.
Defendants contend that their refusal to honor the prescriptions was based on concern
with potential violations of federal law. 21 U.S.C. § 333(e) makes it a crime to knowingly
distribute HGH for use in humans “other than the treatment of a disease or other recognized
medical condition, where such use has been authorized by the Secretary of Health and Human
Services under section 355 of [Title 21] and pursuant to the order of a physician.” They state that
another of Express Scripts’s affiliated pharmacies—Specialty Distribution Services—previously
entered into a deferred prosecution agreement (“DPA”) related to the distribution of HGH and
that the protocols employed in this case were developed in light of that DPA in order to shield
their pharmacists from potential criminal liability. They further claim that through information
obtained during their due diligence, the pharmacies formed a good faith belief that Dr. Kadambi
prescribed HGH for non-medically acceptable reasons, or was at the very least associated with
organizations that advocate for off-label uses of HGH. Accordingly, they declined to honor the
prescriptions as written and explained that decision to the patients in telephone conversations.
This suit followed.
2

Dr. Kadambi has previously brought a similar lawsuit regarding the fulfillment of HGH
prescriptions, which was also assigned to the undersigned judge. Kadambi v. Express Scripts,
Inc., No. 3:12-cv-44. In that suit, Dr. Kadambi sued Express Scripts as the only defendant, and
alleged claims of defamation, intentional interference with a business relationship, and
intentional interference with a contractual relationship. That suit was resolved through a
settlement agreement between Dr. Kadambi and Express Scripts. [DE 71 at 15–18.] One term of
that agreement states “Express Scripts shall not issue any defamatory statements about [Dr.
Kadambi] or his practice group, Fort Wayne Endocrinology, and Express Scripts reserves all
rights, claims and defenses to any claim based on any alleged defamatory statement.” [Id. at 15–
16.]
II.

Motion for Judgment on the Pleadings

Defendants first move for judgment on the pleadings as to Count I. They argue that the
statute on which Plaintiffs base Count I (Indiana Code section 25-26-13-16) does not provide for
a private right of action and, accordingly, the claim should be dismissed.
A.

Standard of Review
A Rule 12(c) motion for judgment on the pleadings permits a party to move for judgment

after the pleadings are closed. Fed. R. Civ. P. 12(c). A motion for judgment on the pleadings
under Rule 12(c) is subject to the same standard of review as a motion to dismiss under Rule
12(b)(6). Buchanan-Moore v. Cnty. of Milwaukee, 570 F.3d 824, 827 (7th Cir. 2009). Therefore,
the court must take the facts alleged in the complaint as true and draw all reasonable inferences
in favor of the non-moving party. Matrix IV, Inc. v. Am. Nat’l Bank and Trust Co. of Chi., 649
F.3d 539, 547 (7th Cir.2011). To survive the motion, the complaint must contain enough facts to
state a claim for relief that is plausible on its face. Brooks v. Ross, 578 F.3d 574, 580–81 (7th
3

Cir.2009) (citing Ashcroft v. Iqbal, 556 U.S. 662 (2009) and Bell Atl. Corp. v. Twombly, 550
U.S. 544 (2007)); see McCauley v. City of Chi., 671 F.3d 611, 615 (7th Cir.2011) (explaining
that “[a] claim has facial plausibility when the plaintiff pleads factual content that allows the
court to draw the reasonable inference that the defendant is liable for the misconduct alleged.”).
The Court need not accept as true legal conclusions or threadbare recitals of the elements of a
cause of action supported by mere conclusory statements. Id. at 616.
The failure of a statute to provide for a private right of action is a valid basis on which
judgment may be entered on the pleadings. See Leatham v. City of LaPorte, No. 3:07-CV-220,
2008 WL 4224940, at *6 (N.D. Ind. Sept. 10, 2008).
B.

Discussion
Count I is premised solely on an alleged breach of Indiana Code section 25-26-13-16.

That statute states:
(a) A pharmacist shall exercise his professional judgment in the
best interest of the patient’s health when engaging in the practice
of pharmacy.
(b) A pharmacist has a duty to honor all prescriptions from a
practitioner or from a physician, podiatrist, dentist, or veterinarian
licensed under the laws of another state. Before honoring a
prescription, the pharmacist shall take reasonable steps to
determine whether the prescription has been issued in compliance
with the laws of the state where it originated. The pharmacist is
immune from criminal prosecution or civil liability if he, in good
faith, refuses to honor a prescription because, in his professional
judgment, the honoring of the prescription would:
(1) be contrary to law;
(2) be against the best interest of the patient;
(3) aid or abet an addiction or habit; or
(4) be contrary to the health and safety of the patient.

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Defendants argue that the statute does not provide a private right of action and, therefore,
judgment should be entered in their favor. Plaintiffs argue that the statute does provide a private
right of action.2 Sitting in diversity, the Court will rely on the substantive law of Indiana and
attempt to predict how the Indiana Supreme Court would decide the issue presented here. See
Lexington Ins. Co. v. Rugg & Knopp, Inc., 165 F.3d 1087, 1090 (7th Cir. 1999) (“Where the state
supreme court has not ruled on an issue, decisions of the state appellate courts control, unless
there are persuasive indications that the state supreme court would decide the issue differently.”).
No Indiana court has ever considered the question of whether section 25-26-13-16
provides for a private right of action. However, Indiana courts have “long-standing analytical
tools” to be used in deciding whether such a right exists. Howard Reg’l Health Sys. v. Gordon,
952 N.E.2d 182, 186–87 (Ind. 2011) (quoting Kho v. Pennington, 875 N.E.2d 208, 218 (Ind.
2007)). The question is one of law for the Court to decide and focuses on the question of
legislative intent. Id. at 187.
The legislature can create a private right of action in one of two ways. The first is
explicitly. Blanck v. Ind. Dep’t of Corr., 829 N.E.2d 505, 509 (Ind. 2005) (“Sometimes the
Legislature will be quite explicit in providing that persons with appropriate standing are entitled
to go to court and ask for enforcement of a statute’s provisions.”). The Indiana legislature states
quite clearly when it intends to create an explicit right of action. See Ind. Code § 22-9.2-7-1 (“An
aggrieved person may file a civil action in the circuit or superior court located in the county in
which the alleged discriminatory practice occurred”); § 8-23-20-12 (“the claimant may file a
2

Alternatively, plaintiffs argue that they are entitled to recovery “based on the Defendants[’] interference with the
physician patient relationship between Kadambi and the Patient Plaintiffs.” [DE 70 at 8.] Plaintiffs then analyze the
potential merits of this claim. [Id. at 8–11.] However, Plaintiffs have not included such a claim in their currently
operative complaint and have not sought leave to amend their complaint to include such a claim. See Thomason v.
Nachtrieb, 888 F.2d 1202, 1205 (7th Cir. 1989) (“It is a basic principle that the complaint may not be amended by
the briefs in opposition to a motion to dismiss.”). Accordingly, that claim is not currently before the Court and the
Court does not address it at this time.

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civil action to have the compensation determined”); § 22-9-1-17 (“If a timely election is made
under section 16 of this chapter, the complainant may file a civil action in a circuit or superior
court having jurisdiction in the county in which a discriminatory practice allegedly occurred.”).
The legislature did not make any such explicit statement of a private right of action in section 2526-13-16.
The other possibility is that the legislature impliedly conferred a private right of action.
“[A] private cause of action generally will be inferred where a statute imposes a duty for a
particular individual’s benefit but will not be where the Legislature imposes a duty for the
public’s benefit.” Blanck, 829 N.E.2d at 509. “As a general rule, a private party may not enforce
rights under a statute designed to protect the public in general and containing a comprehensive
enforcement mechanism.” LTV Steel Co. v. Griffin, 730 N.E.2d 1251, 1260 (Ind. 2000); see also
Howard, 952 N.E.2d at 187 (“A private party may not usually enforce rights under a statute
designed to protect the public in general and which contains an enforcement provision.”). “But
even where a duty benefits an individual, [Indiana courts] will not infer a private right of action
unless that appears to be the Legislature’s intent.” F.D. v. Indiana Dep’t of Child Servs., 1
N.E.3d 131, 143 (Ind. 2013) (Rush, J., concurring in part and dissenting in part). “Indiana courts
have rarely concluded the Legislature intended to confer a private right of action.” Id.
Here, the Court concludes that the statute at issue does not imply a private cause of
action. Initially, the Court notes that the statute appears to primarily benefit the public at large,
rather than any specific individual. Section 25-26-13-16 appears within a chapter titled
“Regulation of Pharmacies and Pharmacists.” Other portions of that chapter create the Board of
Pharmacy. Ind. Code § 25-26-13-3. Power is vested in that Board to, among other things,
promulgate rules for implementing and enforcing the chapter and to investigate complaints
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arising under the chapter. Id. at § 25-26-14-4(a)(1), (7). Additionally, the legislature was clear
regarding the purpose of that particular chapter:
Public Interest. The practice of pharmacy is declared to be a
professional occupation in the state of Indiana, affecting the public
health, safety, and welfare and must be subject to regulation and
control in the public interest by the board of pharmacy. It is further
declared to be a matter of public interest and concern that the
practice of pharmacy merit and receive the confidence of the
public and that only qualified persons be permitted to practice
pharmacy in the state of Indiana.
Id. at § 25-26-14-1.
Moreover, section 25-26-13-16 is located within a regulatory scheme that contains
comprehensive enforcement mechanisms. First, the Board of Pharmacy is empowered to
“investigate complaints, subpoena witnesses, schedule and conduct hearings on behalf of the
public interest on any matter under the jurisdiction of the board.” Id. at § 25-26-13-4(a)(7). With
respect to court action, the chapter empowers the Attorney General to “apply for an injunction in
the circuit court of the county wherein a violation of this chapter is occurring.” Id. at § 25-26-1328.
In this way, section 25-26-13-16 is similar to the statute analyzed in Roberts v. Sankey,
813 N.E.2d 1195 (Ind. Ct. App. 2004). In Roberts, the plaintiffs brought a claim premised on
Indiana Code section 16-21-2-7, which imposes certain requirements on hospital medical staff.
Id. at 1198. The Court of Appeals analyzed whether the statue provided a private cause of action
and found that it did not. In doing so, the Court of Appeals looked to those portions of the code
surrounding the statute at issue and noted both that the particular section was located in a chapter
“intended to address the State’s responsibility to license and regulate hospitals for the protection
of hospital patients” and that it contained a “comprehensive enforcement scheme” that had been

7

“placed in the hands of the State.” Id. at 1199. In the same way, the statute relied on by plaintiffs
is part of a broad regulatory scheme with enforcement mechanisms designed primarily to
regulate the practice of pharmacy in Indiana, for the benefit of the medicine-consuming public.
As such, the Court cannot infer the legislature’s intent to provide a private right of action for a
claimed violation of the provisions of the chapter.
None of the arguments offered by the plaintiffs dissuade the Court from this analysis. The
plaintiffs first argue that section 25-26-13-16 provides civil immunity to a pharmacist if the
refusal to honor a prescription is made in good faith and that this immunity “would be
unnecessary if the statute did not impose a private right of action.” [DE 70 at 3.] This is similar
to the argument raised by the plaintiffs in Howard, who argued that a statute providing civil
immunity “implicitly recognizes that there is civil liability” on the part of a defendant if it
violates such a statute. Howard, 952 N.E.2d at 186. However, the Indiana Supreme Court
rejected that argument, finding that neither the legislative history nor statutory construction rules
supported finding a private right of action on that basis. Id. For that same reason, plaintiffs’
argument here fails.
Plaintiffs next argue that “at least one private cause of action has been brought under”
section 25-26-13-16. [DE 70 at 3.] They cite to Hooks SuperX, Inc. v. McLaughlin, 642 N.E.2d
514, 417 (Ind. 1994) and Kolozsvari v. Doe, 943 N.E.2d 823 (Ind. Ct. App. 2011). However,
neither case was actually brought as a private right of action under the statute cited by the
plaintiffs. Rather, the Indiana courts looked to the statute only to determine whether the
defendants owed some duty as part of a common law claim for negligence. Hooks, 642 N.E.2d at
517 (finding duty to refrain from dispensing a prescription as written based on professional
expertise of pharmacist); Kolozsvari, 943 N.E.2d at 829 (“[W]e hold that CVS and Branchfield
8

had a duty of care to Christine either to warn Christine of the side effects of OsmoPrep or to
withhold the medication.”). Furthermore, neither of those cases addressed the claim that
plaintiffs bring in this case, namely a duty to fulfill a prescription. So the Court finds those cases
inapplicable, as neither involved a claim based upon the Indiana statute.
Finally, plaintiffs argue that section 25-26-13-16 is included in an Indiana Code chapter
which lists statutes that confer immunity. [DE 70 at 4.] Plaintiffs’ argument here is that the
statute must confer a private right of action, because it is included “in title 34 of the Indiana
Code which deals with Civil law and procedure.” [Id.] However, defendants correctly note that
inclusion in chapter 34-30-2 does not necessarily infer a private right of action. Rather, in several
instances, Indiana courts have found that statutes listed in that chapter do not provide for a
private cause of action. See, e.g., C.T. v. Gammon, 928 N.E.2d 847, 854 (Ind. Ct. App. 2010)
(finding no private right of action in section 31-33-6-1, which is listed at 34-30-2-134); Howard,
952 N.E.2d at 187 (finding no private right of action in section 16-39-7-1, which is listed at 3430-2-77.8).
This is not to say that the plaintiffs have no remedy if they believe the defendants are
failing to comply with the Indiana pharmaceutical laws. The Indiana legislature has provided a
mechanism by which any person may file a complaint with the Director of the Indiana Attorney
General Consumer Protection Division. Ind. Code § 25-1-7-4. Upon the filing of such a
complaint, the Director reviews the complaint and, if merited, submits the complaint for review
by the Board of Pharmacy. Id. at 25-1-7-5. It appears to the Court that this mechanism—rather
than the claim brought in this lawsuit—is the recourse available to plaintiffs under Indiana law.
Based on this analysis, the Court finds that the Indiana legislature did not intend to
provide a private right of action in section 25-26-13-16. Accordingly, the Court finds that the
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plaintiffs have not stated a plausible claim for relief in Count I. Defendants’ Motion for
Judgment on the Pleadings as to Count I is therefore GRANTED. Judgment will be entered in
favor of defendants and against plaintiffs on Count I. Because Count I is the only count in which
the patient plaintiffs are named, plaintiffs Linda Hinant, Nancy Hunt, Sharon Yost, Theresa
Bauserman, Ronald Sheron, Darryl Starr, Amanda Partyaka, and Lorna Secunda are
DISMISSED from this case.
III.

Motion to Dismiss under Anti-SLAPP Act

The defendants next move to dismiss the other two counts of the Amended Complaint,
which relate to allegations of defamation.3 They caption the motion as one to dismiss under the
Indiana Anti-SLAPP Act, but the motion also addresses two other issues: qualified privilege and
whether certain of the defendants stand in privity to the contract that plaintiffs allege was
breached in Count III. And although the motion is titled as one to dismiss the claims, all parties
agree that the motion is properly treated—at least with respect to the anti-SLAPP issues—as one
for summary judgment.4 Each of the arguments is discussed in turn, below.
A.

Anti-SLAPP
SLAPP stands for “Strategic Lawsuit Against Public Participation.” Poulard v. Lauth,

793 N.E.2d 1120, 1122 n.2 (Ind. Ct. App. 2003). Anti-SLAPP statutes are a reasonably new
phenomenon—Indiana’s was passed in 1998—and are designed to “reduce the number of
lawsuits brought primarily to chill the valid exercise of the constitutional rights of freedom of
speech and petition for the redress of grievances.” Id. Suits subject to dismissal under the Anti3

Count II is a claim of common law defamation brought by Dr. Kadambi. Count III is a claim for breach of
contract, namely the settlement agreement from Dr. Kadambi’s earlier suit against Express Scripts. The acts that Dr.
Kadambi claims breached the settlement agreement are the same statements identified as defamatory in Count II.
4

For the reasons stated below, the Court concludes that the qualified privilege portion of the motion should also be
treated as a summary judgment motion, but that the privity argument need not be converted to a summary judgment
since its determination does not require consideration of any material outside the complaint.

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SLAPP Act are “meritless suits aimed at silencing a plaintiff’s opponents, or at least diverting
their resources.” Nexus Group, Inc. v. Heritage Appraisal Serv., 942 N.E.2d 119, 122 (Ind. Ct.
App. 2011).
1.

Standard of Review

Although titled as a motion to dismiss, both Indiana statute and the Federal Rules of Civil
Procedure treat a motion to dismiss on anti-SLAPP grounds as a motion for summary judgment.
Ind. Code § 34-7-7-9(a)(1) (“If a person files a motion to dismiss under this chapter, the court in
which the motion is filed shall . . . [t]reat the motion as a motion for summary judgment.”); Fed.
R. Civ. P. 12(d) (converting to summary judgment a motion which includes facts outside the
pleadings). Once treated as a summary judgment motion, the motion should be granted if the
record shows “that there is no genuine issue as to any material fact and that the movant is entitled
to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The motion should be granted only if no
rational fact-finder could decide in favor of the non-moving party. Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 249 (1986). The Court must view all of the evidence in the light most
favorable to the non-moving party and must resolve all factual disputes in that party’s favor.
Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000).
2.

Discussion

Indiana’s anti-SLAPP statute is “typical” of other state anti-SLAPP statutes. Poulard,
793 N.E.2d at 1122 n.2. It provides:
It is a defense in a civil action against a person that the act or
omission complained of is:
(1) an act or omission of that person in furtherance of the
person’s right of petition or free speech under the
Constitution of the United States or the Constitution of the
State of Indiana in connection with a public issue; and
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(2) an act or omission taken in good faith and with a
reasonable basis in law and fact.
Ind. Code § 34-7-7-5. If successful in having a claim dismissed under the act, the defendant is
entitled to reasonable attorneys’ fees. Id. at § 34-7-7-7. Conversely, if the Court finds that the
anti-SLAPP motion was either “frivolous” or “solely intended to cause unnecessary delay,” then
the plaintiff is entitled to reasonable attorneys’ fees. Id. at § 34-7-7-8.5
The Court begins with the issue of whether the defendants acted “in furtherance of [their]
right of petition or free speech . . . in connection with a public issue.” The Court finds, based on
the current record, that the defendants have not met their burden on this issue, and so finds that
question dispositive of the anti-SLAPP portion of the motion.
“The person who files a motion to dismiss [under anti-SLAPP] must state with specificity
the public issue or issue of public interest that prompted the act in furtherance of the person’s
constitutional right of petition or free speech.” Brandom v. Coupled Products, LLC, 975 N.E.2d
382, 385 (Ind. Ct. App. 2012) (citing Ind. Code § 34-7-7-9). “Speech is on a matter of public
concern if it is addressed to ‘any matter of political, social, or other concern to the community,’
as determined by its content, form, and context.” Id. at 386 (quoting Love v. Rehfus, 946 N.E.2d
1, 10 (Ind. 2011)). Indiana courts have not spoken “at length” regarding whether speech relates
to a matter of public concern in the anti-SLAPP context, but has noted with approval the analysis
of California courts on that topic. Id. (citing Cross v. Cooper, 197 Cal. App. 4th 357 (2011)). In
that context, California courts have recognized three non-exclusive categories of statements that
5

The statute contains a number of other procedural rules for handling anti-SLAPP motions, but those procedures are
not applicable to this Court. Once a case is removed to federal court, federal law and rules govern all procedural
aspects of the case. See Containment Techs. Group, Inc. v. Am. Society of Health Sys. Pharmacists, No. 1:07-cv-997,
2009 WL 2750093, at *4 (S.D. Ind. Aug. 26, 2009) (declining to impose state procedural requirements in antiSLAPP motion brought in federal court). Moreover, the continuing validity of some of those rules are in question
even in Indiana state courts. See id. at *3.

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have been given anti-SLAPP protection: (1) “cases where the statement or activity precipitating
the underlying cause of action was ‘a person or entity in the public eye’”; (2) “cases where the
statement or activity precipitating the underlying cause of action ‘involved conduct that could
affect large numbers of people beyond the direct participants’”; and (3) “cases where the
statement or activity precipitating the claim involved ‘a topic of widespread, public interest.’” Id.
(quoting Cross, 197 Cal. App. 4th at 373–74 (citations omitted)).
Here, defendants argue that their statements were related to their offering of
pharmaceutical services and that the Indiana legislature has declared the occupation of pharmacy
to “affect[] the public health, safety, and welfare” and to be “a matter of public interest.” [DE 65
at 11–12.] They also argue that the statements were made in one-on-one conversations with
Accredo representatives and were directly related to the fulfillment of their prescriptions. [Id. at
12.] Dr. Kadambi argues that this interest is too broad and that “[i]f such a broad inference were
to succeed than there would be almost no limit to what is a matter of public interest.” [DE 72 at
15.]
The Court agrees with Dr. Kadambi on this point and finds a logical disconnect between
the proffered public interest and the context, form, and content of the statements actually at issue
in this case. While defendants assert a broad public interest in pharmaceutical services—which
this Court does not doubt—the actual statements at issue here are significantly more narrow in
scope. Instead, the statements at issue were several explanations, each to a single patient,
regarding why a single prescription could not be filled. These conversations took place over the
phone, when prompted by a question from the patient regarding the reason the prescription
would not be disbursed, and were not (as far as the Court can tell) disseminated any further.

13

In this context, the Court finds persuasive the rationale of Fouse v. Shin, No. B194495,
2007 WL 2353364 (Cal. Ct. App. Aug. 20, 2007).6 That case, like this one, dealt with statements
made by a pharmacist to an individual patient regarding the ability of the pharmacist to dispense
medication as prescribed. The pharmacist made statements to and asked questions of the patient,
in order to help determine whether dispensing the medication was consistent with California law.
The patient sued and the pharmacist moved to dismiss on anti-SLAPP grounds. The anti-SLAPP
motion was dismissed, in part, because the court found no public interest in the more narrow
question of the patient’s individual health. Id. at *6 (“the mere fact that the Medi-Cal guidelines
requiring Shin’s inquiry into plaintiff’s medical condition were presumably designed to further a
legitimate public purpose does not mean that the inquiry itself was a matter of public interest or
debate.”).
Similar reasoning persuades the Court to reach a similar result in this case. While the
practice of medicine and pharmacy, on the macro level, is no doubt of great interest to the
general public, the public interest in the more narrow issues addressed in the statements made by
the Accredo personnel is not significant. Specifically, defendants offer no evidence that either
Dr. Kadambi or the patients at issue is a person “in the public eye.” Brandom, 975 N.E.2d at 385.
Nor is there any evidence that the alleged conduct by Dr. Kadambi “could affect large numbers
of people beyond the direct participants” or that Dr. Kadambi’s prescription practices or the
medical needs of the patients at issue is “a topic of widespread, public interest.” Id. Without this
more narrow focus on the public interest at issue, the Court believes that the anti-SLAPP
protections would paint with too broad a brush, providing immunity to any statement made by

6

The Court recognizes that Fouse is an unpublished decision and that Cal. R. Ct. 8.1115 restricts the citation of
unpublished opinions in California state courts. However, the fact that the parties may not cite the opinion does not
prohibit the Court from finding its reasoning persuasive in a case presenting a somewhat similar factual issue.

14

pharmaceutical personnel simply by virtue of the fact that the industry in which they practice is
one of general concern to the public.
Further, the Court cannot find that Accredo’s statements were made “in furtherance of”
any free speech rights. Defendants have made clear that their purpose in making the statement
was to communicate the reason for declining to dispense the prescriptions at issue and to protect
themselves from potential liability under federal law. That the statements were admittedly selfmotivated on a matter of private concern is inconsistent with any claimed intent to engage in
public debate on these issues. See Kentner v. Timothy R. Downey Ins., Inc., 430 F. Supp. 2d 844,
846 (S.D. Ind. 2006) (“Plaintiff concedes that his intent in serving the non-party discovery
requests was to gather support for his claims in this litigation; thus, Plaintiff was not acting as a
citizen ‘in furtherance’ of his right to comment on a public issue as is required by the AntiSLAPP Act.” (citation omitted)).
Moreover, it appears that plaintiffs’ purpose in filing this suit is not primarily directed at
stifling the defendants’ speech rights. Rather the gravamen of the complaint is an attempt to have
the prescriptions filled as prescribed and the defamation claims appear to be collateral to the
main thrust of the suit. Accordingly, the Court finds that this “is not the type of lawsuit that the
anti-SLAPP statute was enacted to prevent.” Hamilton v. Prewett, 860 N.E.2d 1234, 1248 (Ind.
Ct. App. 2007) (affirming dismissal of suit but denying award of attorneys’ fees under antiSLAPP because the suit was not “an attempt by [the plaintiff] to silence [the defendant’s] speech
on a public issue or an issue of public interest.”).
Finding that the defendants have not sufficiently shown that their actions were in
furtherance of free speech on a public issue or matter of public interest, the Court need not
address whether the defendants acted in good faith for the purposes of anti-SLAPP. The anti15

SLAPP portion of the motion is therefore DENIED. However, the Court does not find that the
motion was either “frivolous” or “solely intended to cause unnecessary delay,” Ind. Code § 34-77-8, because the arguments appear to have been made in good faith by the defendants and
without any intent to harass the plaintiffs. See In re Walter Penner Trust, 22 N.E.2d 593 (Ind. Ct.
App. 2014) (stating claim is “frivolous” for the purpose of awarding fees under a separate
Indiana statute “if it is made primarily to harass or maliciously injury another.”). The Court
therefore DENIES Dr. Kadambi’s request for attorneys’ fees in responding to the motion.
B.

Qualified Privilege
Defendants next argue that, even if anti-SLAPP does not merit summary judgment, Dr.

Kadambi’s claims fail because the defendants acted with a qualified privilege in making the
statements at issue. The parties do not specifically address the standard of review this Court
should use in determining whether the statements are protected by a qualified privilege.
However, in arguing whether defendants made the statements in good faith, both parties
submitted a number of documents not included in the pleadings. Accordingly, the Court
construes this part of the motion as one for summary judgment and reviews it accordingly. Fed.
R. Civ. P. 12(d); Rutherford v. Judge & Dolph Ltd., 707 F.3d 710, 713–14 (7th Cir. 2013) (if
considering evidence that is not referred to in the plaintiff’s complaint, the district court must
convert the motion to one for summary judgment).
Under Indiana law, a qualified privilege of common interest “applies to communications
made in good faith on any subject matter in which the party making the communication has an
interest or in reference to which he has a duty, either public of private, either legal, moral, or
social, if made to a person having a corresponding interest or duty.” Schraeder v. Eli Lilly & Co.,
639 N.E.2d 258, 262 (Ind. Ct. App. 1994) (citing Bals v. Verduzco, 600 N.E.2d 1353, 1356 (Ind.
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1992)). “The essential elements of the defense of qualified privilege are good faith, an interest to
be upheld, a statement limited in its scope to this purpose, a proper occasion, and publication in a
proper manner to the appropriate parties only.” Id.
Dr. Kadambi challenges only that the statements were made in good faith. [DE 72 at 13.]
The question of good faith can best be analyzed in the context of the specific statements that
plaintiffs allege were made by the Accredo representatives. Dr. Kadambi alleges that the
following statements were made:


“the prescriber has been identified as providing growth
hormone for anti-aging, longevity, rejuvenation, cosmetic,
performance enhancement or sports medicine health
services” [DE 58 at ¶ 27]



“if you are getting it for actual medical reasons that is [sic]
necessary, then you will have to get another prescriber who
isn’t identified as utilizing this prescription for those
causes” [Id.]



“Dr. Kadambi writes prescriptions for cosmetic reasons”
[Id. at ¶ 28]



“Dr. Kadambi is coming up as a plastic surgeon” [Id. at ¶
29]



Dr. Kadambi is on a “list” and involved with “sports
medicine and anti-aging medicine” [Id. at ¶ 30]



Dr. Kadambi’s prescription was “fraudulent” and “illegal”
[Id. at 31]

Defendants claim that each of the statements were made in good faith, based on an investigation
undertaken by the pharmacists reviewing HGH prescriptions and the research done on Dr.
Kadambi to determine “if that doctor or his or her practice advertises, writes about, lectures on,
promotes, or is otherwise associated with prescribing HGH or recommending hormone
replacement therapy for anti-aging, wellness, cosmetic, or sports medicine purposes.” [DE 66 at
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2–3.] Dr. Kadambi does not factually challenge that an investigation was conducted by Accredo
or what was found during the course of that investigation. Instead, he claims that the statements
were not in good faith because defendants conducted only limited discovery and turned a blind
eye to information that they had been given by Dr. Kadambi in a previous lawsuit.
Good faith is defined as “a state of mind indicating honesty and lawfulness of purpose;
belief in one’s legal right; and a belief that one’s conduct is not unconscionable.” Nexus, 942
N.E.2d at 122 (quoting Owens v. Schoenberger, 681 N.E.2d 760, 764 (Ind. Ct. App. 1997)
(internal quotations omitted). In the context of a qualified privilege for defamation, good faith
exists unless the evidence shows the speaker “lacked any grounds for belief as to the truth of the
statements.” Dugan v. Mittal Steel USA Inc., 929 N.E.2d 184, 189 (Ind. 2010) (quoting Bals, 60
N.E.2d at 1357). Good faith is a question of fact and “[i]f different inferences and conclusions
could reasonably be drawn from the evidence” then the question should be submitted to a jury.
Cortez v. Jo-Ann Stores, Inc., 827 N.E.2d 1223, 1234 (Ind. Ct. App. 2005). Further, where one
party undertakes an investigation, but has some reason to doubt the accuracy of the information
that it obtained, qualified privilege may not be appropriate. See State Farm Fire & Cas. Co. v.
Radcliff, 987 N.E.2d 121, 142–43 (Ind. Ct. App. 2013) (finding insufficient evidence of good
faith in light of fraud and omissions in investigative report).
Based on the arguments presented and the current state of the record, the Court finds
genuine disputes of material fact regarding Accredo’s good faith, precluding summary judgment
at this time. Dr. Kadambi seems to argue that Accredo should have known that the information it
obtained in its investigation was not true, based on the information previously shared in the prior
litigation. The Court has no information regarding what information was shared with Express
Scripts during the prior litigation with Dr. Kadambi, which resulted in the settlement agreement
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at issue in Count III. The Court also has no information regarding the extent to which Accredo—
who is alleged to have made the defamatory statements—is aware of information obtained
through previous litigation between Dr. Kadambi and Accredo’s parent company. However,
drawing all reasonable inferences in favor of Dr. Kadambi, a rational jury could find that
Accredo did learn of the information provided by Dr. Kadambi in the previous litigation and that
such information would have caused Accredo to doubt the accuracy of what it learned about Dr.
Kadambi in the search it undertook prior to declining to dispense the prescriptions in this case.
Accordingly, the Court declines to enter summary judgment on Counts II and III at this time.
C.

Privity of Contract
The final ground on which defendants seek dismissal is that certain of the defendants

were not parties to the settlement agreement at issue in the claimed breach of contract in Count
III. Dr. Kadambi has not responded to this argument. It is true that, as a general proposition,
“only a party to the contract can be held liable for its breach because contractual obligations are
personal in nature.” Rodriguez v. Tech Credit Union Corp., 824 N.E.2d 442, 446–47 (Ind. Ct.
App. 2005). Accredo—the only defendant alleged to have made any defamatory statements—
was not a party to the settlement agreement. In light of this evidence, Dr. Kadambi offers no
reason why Count III should survive.
This particular argument did not require the Court to look to any document outside (or
not incorporated into) the complaint, so the motion on this ground need not be converted to
summary judgment. See Burke v. 401 N. Wabash Venture, LLC, 714 F.3d 501, 505 (7th Cir.
2013) (district court may properly consider, in ruling on a Rule 12(b)(6) motion, a document that
is referenced in and central to the claims in a complaint, even if it was not attached to the

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complaint). Accordingly, the Court DISMISSES Count III without prejudice for failure to state a
claim.
IV.

Motion for Preliminary Injunction

As noted earlier, there is also a pending motion for preliminary injunction, filed by the
plaintiffs. [DE 54.] Briefing on that motion was stayed pending resolution of the defendants’
dispositive motions. The focus of the motion for preliminary injunction is the defendants’
claimed violation of Indiana law for failing to dispense the prescription as ordered. Having found
that section doesn’t provide a private right of action the Court DENIES the motion for
preliminary injunction. [DE 54.]
V.

Conclusion

For the reasons stated above, Defendants’ Motion for Judgment on the Pleadings as to
Count I [DE 62] is GRANTED and Defendants’ Motion to Dismiss Defamation Claims (Counts
II and III) Pursuant to Indiana’s Anti-SLAPP Act [DE 64] is GRANTED IN PART and
DENIED IN PART. Judgment is entered in favor of defendants on Count I. Count III is
DISMISSED WITHOUT PREJUDICE for failure to state a claim. Plaintiffs are granted leave
to file, within 30 days of this decision, an amended complaint consistent with this opinion.
Plaintiffs’ Motion for Preliminary Injunction is also DENIED with leave to refile. [DE 54.]
SO ORDERED.
ENTERED: February 5, 2015

/s/ JON E. DEGUILIO
Judge
United States District Court

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