COLUMBUS, Ohio (Legal Newsline) – Kroger has failed to convince an Ohio federal judge to throw out a class action lawsuit brought by a woman who did not enroll in its savings club but still wanted savings.
The case, filed in January 2021, concerns the prices Kroger charges health insurers for generic drugs. Plaintiff Judy Kirkbride says Kroger charges insurers for “usual and customary” prices when it should have accounted for lower prices paid through its Rx Savings Club.
The result for customers is inflated copays. Kroger argued last year in a motion to dismiss that alleged misrepresentations to a third party like an insurance company that inadvertently harm customers can’t form the basis of a fraud claim in Ohio.
Kroger is one of many to face such a case, with CVS having won at trial and others having proceeded past the defendant’s motion to dismiss. It asked Ohio judge Algenon Marbley to reject the decisions made by those courts to allow the cases to proceed.
“Kroger urges the court to reject those ‘other U&C cases’ because they ‘were based on different laws and different facts pled,’” Judge Marbley wrote.
“Kroger is correct in one regard: none of those cases controls the outcome here. Still, Kroger underestimates the persuasive value of similar allegations tested, and mostly sustained, in district courts across the country.
“To grant Kroger a full dismissal would leave this case the sole outlier amongst the 11 named in Plaintiff’s response brief.”
The complaint says most customers enroll in the Savings Club, which costs $36 per year, because the discounts are so attractive, which makes the Savings Club price the actual “usual and customary” price it should report to insurers.
One named plaintiff only alleges a $1.97 overcharge on one purchase, but others allege much higher per-transaction overcharges on dozens of purchases.