McGraw altered federal suit, Rite Aid claims

By Steve Korris | Nov 2, 2009


CHARLESTON, W.Va. (Legal Newsline) - Owners of retailer Rite Aid claim West Virginia Attorney General Darrell McGraw altered a suit over generic drug prices in a bid to escape federal jurisdiction.

On Oct. 27, Rite Aid lawyer Robert DeJong of Detroit asked U.S. District Judge John Copenhaver to deny McGraw's motion for remand to Boone County.

DeJong wrote that allegations in the motion differed from those in the complaint.

"As originally filed, the state sought to recover for alleged overpayments by any and all in West Virginia who paid for generic prescription drugs," DeJong wrote. "After Rite Aid removed the case to this court on federal question grounds, the state shifted gears and purportedly excised from its claim any purchases made through Medicare or Medicaid.

"In an apparent effort to keep this court from exercising jurisdiction over this case, the state has again shifted gears."

He wrote that in McGraw's most recent brief, the state no longer seeks damages for purchases under federal laws on health and retirement benefits.

He urged Copenhaver to keep the case in spite of shifting gears and pleaded that by McGraw's interpretation, West Virginia law conflicts with federal law.

"Rite Aid receives payments based on prices set by federal programs and federally defined terms that Rite Aid is in no position to negotiate or change," he wrote.

West Virginia law and federal health benefit law prescribe different price formulas, he wrote, leaving Rite Aid "stuck in the middle of a conflict."

McGraw's suit seeks civil penalties, restitution and disgorgement.

He appointed Charleston lawyers Brian Glasser, John Barrett, Michael Murphy, Joshua Barrett and Sean McGinley as special assistants.

U.S. Magistrate Judge Mary Stanley, managing discovery for Copenhaver, planned a scheduling conference on Oct. 29.

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