Medicaid Fraud Control Act, violations of the Mississippi Unfair and Deceptive Trade Practices Act, fraud and unjust enrichment. The Complaint alleges the Company failed to accurately report usual and customary prices to Mississippi’s Division of Medicaid. On November 14, 2016, the Company filed motions to dismiss based on jurisdictional and substantive grounds, as well as a motion to transfer venue, all of which were stayed pending the resolution of related litigation involving another chain pharmacy on appeal. In September 2018, the stay of the case was lifted. On November 28, 2018, the case was transferred to the Circuit Court of Desoto County and consolidated with related cases containing similar allegations brought by Mississippi against other chain pharmacies. On June 11, 2019, the court (i) dismissed the claims against the Company for lack of personal jurisdiction; and (ii) dismissed the fraud-based claims against the Company’s purportedly related entities (Rite Aid Hdqtrs. Corp., Harco, Inc., and K&B of Mississippi Corporation) for failure to plead the fraud-based claims with particularity, but with leave to amend. The court did not dismiss the claims against the purportedly related entities for unjust enrichment or for restitution under the Mississippi Consumer Protection Act. On August 2, 2019, the State of Mississippi filed a Second Amended Complaint that does not assert any claims against the Company, but does assert claims against the purportedly related entities for fraud, unjust enrichment, and for restitution under the Mississippi Consumer Protection Act. At this stage of the proceedings, the Company is not able to either predict the outcome of this lawsuit or estimate a potential range of loss with respect to the lawsuit, and is vigorously defending this lawsuit.
The Company is named in multiple opioid-related lawsuits filed by counties, cities, municipalities, Native American tribes, hospitals, and third-party payers across the United States. Specifically, as of September 24, 2019, a total of 1,262 opioid-related lawsuits have been filed against the Company. 1,104 lawsuits have been filed in federal court, of which 1,018 have been transferred to the multi-district litigation (“MDL”) pending in the U.S. District Court for the Northern District of Ohio before Judge Dan Polster under In re National Prescription Opiate Litigation (Case No. 17-MD-2804). There are approximately 158 lawsuits that name the Company in some capacity that have been filed outside the MDL in state court. The plaintiffs in all of these opioid-related lawsuits generally allege claims concerning the impacts of widespread opioid abuse against defendants along the pharmaceutical supply chain, including manufacturers, wholesale distributors, and retail pharmacies.
New lawsuits continue to be added to the MDL, including lawsuits filed in Alabama, Arizona, California, Colorado, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nebraska, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming. Since December 2017, nearly all related lawsuits pending in federal district courts have been transferred to the MDL. Two of the Ohio lawsuits in the MDL (referred to as the “Track One” or “bellwether” lawsuits) have been set for an October 21, 2019 trial date: The County of Summit, Ohio v. Purdue Pharma L.P., et al., Case No. 18-OP-45090 (N.D. Ohio); and The County of Cuyahoga v. Purdue Pharma L.P., et al., Case No. 17-OP-45004 (N.D. Ohio). On August 15, 2019, Judge Polster granted the plaintiffs’ motion to sever several defendants, including the Company. As a result, the Company will not be a defendant in the first bellwether trial, but could be a defendant in a subsequent trial involving the same plaintiffs. A group of West Virginia lawsuits have already been selected for the second bellwether track, which include lawsuits filed by Cabell and Huntington Counties.
The federal lawsuits that are not part of the MDL are filed by counties and municipalities in California, Georgia, Idaho, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, New Jersey, New York, North Dakota, Oklahoma, Pennsylvania, Utah, Vermont, Virginia, and West Virginia. The lawsuits filed outside the MDL in state