MATTHEW ENRIQUEZ v. JOHNSON JOHNSON

NOT FOR PUBLICATION WITHOUT THE
                               APPROVAL OF THE APPELLATE DIVISION
        This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
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                                                        SUPERIOR COURT OF NEW JERSEY
                                                        APPELLATE DIVISION
                                                        DOCKET NO. A-1174-19

MATTHEW ENRIQUEZ,
individually and on behalf
of all others similarly situated,

          Plaintiff-Appellant,

v.

JOHNSON & JOHNSON,
JANSSEN PHARMACEUTICALS,
INC., ACTAVIS PHARMA, INC.,
and ACTAVIS LLC,

          Defendants-Respondents.


                   Argued October 21, 2021 – Decided November 12, 2021

                   Before Judges Alvarez, Haas, and Mawla.

                   On appeal from the Superior Court of New Jersey, Law
                   Division, Camden County, Docket No. L-4677-18.

                   J. Michael Connolly (Consovoy McCarthy, PLLC) of
                   the Virginia and District of Columbia bars, admitted
                   pro hac vice, argued the cause for appellant (Joshua M.
                   Neuman, Tobias L. Millrood and Gabriel C. Magee
                   (Pogust Millrood, LLC), J. Michael Connolly, William
                   S. Consovoy (Consovoy McCarthy, PLLC) of the
            Virginia and District of Columbia bar, admitted pro hac
            vice, Ashley C. Keller (Keller Lenkner LLC) of the
            Illinois bar, admitted pro hac vice, and Travis Lenkner
            (Keller Lenkner, LLC) of the Illinois bar, admitted pro
            hac vice, attorneys; Joshua M. Neuman, Tobias L.
            Millrood, Gabriel C. Magee, Kyle N. Thompson
            (Kilcoyne & Nesbitt, LLC), Ashley C. Keller, Travis
            Lenkner and William S. Consovoy, on the briefs).

            Jonathan P. Schneller (O'Melveny & Myers LLP) of the
            California bar, admitted pro hac vice, argued the cause
            for respondents (Jonathan P. Schneller and Calcagni &
            Kanefsky, LLP, attorneys for Johnson & Johnson and
            Janssen Pharmaceuticals, Inc.; Morgan, Lewis &
            Bockius, LLP, attorneys for Actavis Pharma, Inc. and
            Atavis LLC; Eric T. Kanefsky, Walter R. Krzastek,
            Martin B. Gandelman, Harvey Bartle, IV, Mark Fiore
            and Brian M. Ercole, on the joint brief).

PER CURIAM

      Plaintiff Matthew Enriquez appeals from an October 10, 2019 order

dismissing his complaint with prejudice pursuant to Rule 4:6-2(e). We affirm.

      In December 2018, plaintiff filed a class action suit against defendants

Johnson & Johnson, Janssen Pharmaceuticals, Inc., Actavis Pharma, Inc., and

Actavis LLC. The proposed class was defined as "[a]ll current New Jersey

citizens (including natural persons and entities) who purchased health insurance

policies in New Jersey from 1996 through the present; and all current New

Jersey citizens who paid for any portion of employer-provided health insurance

from 1996 through the present." The complaint asserted causes of action for:

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violation of the New Jersey Consumer Fraud Act (CFA),  N.J.S.A. 56:8-1

to -226; public nuisance; unjust enrichment; negligence; and negligent

interference with prospective economic advantage. 1

      The complaint alleged defendants fueled the opioid crisis in New Jersey,

causing insurance companies to pay the costs of opioid medication and addiction

treatment for their insureds, which increased premiums, co-pays, and

deductibles for plaintiff and the other class members. It asserted defendants

"manufacture[d], market[ed] and [sold] prescription opioids, . . . [and] engaged

in a . . . deceptive marketing scheme to encourage doctors and patients to use

opioids to treat chronic pain." It further claimed defendants "falsely minimized

the risks of opioids, [and] overstated their benefits and generated far more opioid

prescriptions than there should have been." Defendants allegedly represented

that opioid addiction could be treated through use of opioids, misrepresented the

signs of addiction, and suggested tapering or increasing opioid use as a valid

means of treatment.        Plaintiff asserted "[d]efendants knew that their

misrepresentations about the risks and benefits of opioids were not supported

by, and sometimes were directly contrary to, the scientific evidence."



1
   Plaintiff has not appealed the dismissal of the negligent interference with
prospective economic damage count.
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      The complaint alleged "[d]efendants devised a scheme to misrepresent the

risks and benefits of opioids to increase prescriptions by tapping into the large

and lucrative market for chronic-pain patients."           Further, defendants

disseminated false and misleading information through: continuing medical

education programs; advertisements targeting medical professionals and the

public; websites; and direct sales and promotional communications with doctors

and chronic-pain patients.

      According to plaintiff, "[d]efendants created, funded, controlled, and

operated third-party organizations that communicated directly with doctors and

chronic-pain patients to promote opioid use generally without naming specific

brands . . . [giving] the false appearance that the deceptive messages came from

an independent and objective source." Third-party groups aided "[d]efendants

by responding to negative articles, advocating against regulatory changes that

would limit opioid prescriptions, and conducting outreach to vulnerable patient

populations targeted by the [d]efendants."        The complaint also alleged

defendants recruited highly qualified medical professionals to spread

misinformation "about the risks and benefits of opioids and other pain-treatment

options."   These individuals "purported to act independently," thereby




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"lend[ing] legitimacy to the [d]efendants' false and misleading claims about

opioids."

      Defendants allegedly falsely claimed "opioids produce positive long-term

outcomes in cases of chronic pain[,]" and misrepresented the risks of competing

non-opioid pain-relief products, "so that doctors and patients would favor

opioids for treatment of chronic pain." The complaint asserted defendants

unlawfully targeted susceptible providers and vulnerable populations.

      Defendants moved to dismiss the complaint for failure to state a claim.

Judge Steven J. Polansky heard oral argument on the motion. Plaintiff's counsel

explained causation and damages would be proved by an expert's estimate of the

likely percentage of improperly written prescriptions and the resulting cost of

opioid addiction treatment, based on statistics from a sample of opioid

prescriptions. The expert would then calculate the corresponding increase in

health insurance costs.

      The judge granted the motion to dismiss, finding the CFA claim could not

stand because "[d]efendants had no contact with [p]laintiff, and did not make

any misrepresentations or omissions to [him]." Even if the plaintiff's allegations

were true, the judge found several "links of causation separate [d]efendants'

actions from plaintiff's alleged injury[.]" He enumerated the links as follows:


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1) defendants' manufacturing and marketing to prescribers and patients; 2)

doctors prescribing the opioids; 3) patients using, abusing, and becoming

addicted to the opioids; 4) plaintiff's insurer reimbursing patients for the drugs

and addiction-related costs; and 5) plaintiff's insurer increasing premiums due

to opioid use.

      The judge also concluded plaintiff's theory of recovery was "speculative

and attenuated." He found plaintiff could not "establish an ascertainable loss

through statistical data" because it was "essentially a fraud on the market theory

which has been rejected as a basis to establish an ascertainable loss" by our

Supreme Court. See Int'l Union of Operating Eng'rs Local No. 68 Welfare Fund

v. Merck & Co.,  192 N.J. 372, 392 (2007) (rejecting the use of fraud on the

market theory to prove insurers paid increased costs for Vioxx because of the

defendant's fraudulent marketing campaign).

      The judge concluded it was "highly impracticable" to claim insurance

premiums increased due to opioids because

            [t]here are a myriad of reasons, independent of the
            opioid epidemic, which have an impact on insurance
            costs. Some costs may be borne by insurers resulting
            in lower profits, some may be paid by employers[,] and
            some may be passed on to the purchasers of health
            insurance. These costs may also be subject to higher
            co-pays, deductibles or limitations of coverage.


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      As to both his CFA and public nuisance claims, plaintiff argued his case

was similar to James v. Arms Technology, Inc.,  359 N.J. Super. 291 (App. Div.

2003). In James, several cities and counties sued gun manufacturers alleging

they "intentionally or negligently created and fueled an illegal gun market,

thereby unreasonably interfering with the public welfare, knowing, or having

reason to know, that their conduct has a significant effect upon a public right."

Id. at 332 (citing Restatement (Second) of Torts § 821B (Am. Law Inst. 1979)).

We affirmed the denial of defendant's motion to dismiss noting a "public

nuisance may exist[] if the conduct complained of involves a 'significant

interference' with the public welfare or 'is of a continuing nature or has produced

a permanent or long-lasting effect, and, as the actor knows or has reason to

know, has a significant effect upon the public right.'"       Id. at 330 (quoting

Restatement (Second) of Torts at § 821B(2)(a) and (c)).

      The judge dismissed plaintiff's public nuisance count. He reasoned such

claims should be "brought by a governmental entity or an individual who

sustains some special damage over and above that suffered by the general

public" and the complaint failed to meet either criterion.

      He also dismissed the unjust enrichment claim, finding "[p]laintiff can

point to no direct benefit received by any [d]efendant from [p]laintiff. Rather,


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any benefit [p]laintiff conferred was directed to his health insurer. The facts

presented are far too remote to permit a cause of action based upon unjust

enrichment to proceed."

      The judge also concluded the negligence claim was not viable because

defendants owed no duty of care to plaintiff. He stated: "The nature of the risk

to consumers of health insurance is too far removed [from defendants' conduct],

and any risk too attenuated, to find as a matter of fairness that a duty should

extend to such outer limits."

      We review "de novo the trial court's determination of the motion to

dismiss under Rule 4:6-2(e)."      Dimitrakopoulos v. Borrus, Goldin, Foley,

Vignuolo, Hyman and Stahl, P.C.,  237 N.J. 91, 108 (2019) (citing Stop & Shop

Supermarket Co. v. Cnty. of Bergen,  450 N.J. Super. 286, 290 (App. Div. 2017)).

We "search[] the complaint in depth and with liberality to ascertain whether the

fundament of a cause of action may be gleaned even from an obscure statement

of claim . . . ." Printing Mart-Morristown v. Sharp Elecs. Corp.,  116 N.J. 739,

746 (1989) (quoting Di Cristofaro v. Laurel Grove Mem'l Park,  43 N.J. Super.
 244, 252 (App. Div. 1957)). We "accept the truth of [a] plaintiff's allegations

and, also, give [the] plaintiff the benefit of all reasonable factual inferences ."

Perkins v. DaimlerChrysler Corp.,  383 N.J. Super. 99, 110-11 (App. Div. 2006).


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Our review "is limited to examining the legal sufficiency of the facts alleged on

the face of the complaint[,]" and we do not concern ourselves with a plaintiff's

ability to prove the allegations. Printing Mart,  116 N.J. at 746.

      Having conducted our review pursuant to these principles, we affirm

substantially for the reasons set forth in Judge Polansky's thorough and well-

written opinion. We add the following comments.

      Plaintiff's reliance on James to support the viability of his CFA claim

based on a fraud on the market theory of causation is misplaced. The James

plaintiffs asserted negligence, product liability, public nuisance, and unjust

enrichments claims; they did not assert a CFA claim.  359 N.J. Super. at 304.

Moreover, James is inapposite because plaintiff and the putative class are private

as opposed to public entities.

      Plaintiff asserts James supports his public nuisance claim and his overall

theory of causation, which was based on the hypothetical effects of defendants'

conduct on insurance costs and premiums. This argument is likewise unavailing.

In In re Lead Paint Litigation, the Supreme Court affirmed dismissal of the

plaintiffs' complaint against manufacturers of lead paint for failure to state a

claim for public nuisance.  191 N.J. 405, 440 (2007). Writing for the majority,

Justice Hoens explained:


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            A public entity proceeding in public nuisance
            vindicates the common right and thus pursues . . . civil
            actions to abate the nuisance . . . [whereas a] private
            plaintiff . . . does not necessarily sue to vindicate a
            public right, but seeks recompense for damages to the
            extent of the special injury sustained, apart from the
            interference with the public right.

            [Id. at 434.]

A "special injury has a specific and well-defined meaning in public nuisance

jurisprudence. It must be an injury different in kind, rather than in degree." Id.

at 436. The Court held dismissal of the complaint was proper because it did not

establish "the requisite connection between damages and special injury." Id. at

435 n.10.

      Plaintiff's complaint did not establish a special injury. The complaint

averred "[p]rescription opioids have devastated communities across the country

and in the State of New Jersey . . . [and] some estimates state that the opioid

crisis is costing governmental entities and private companies as much as $500

billion per year." Accepting this claim as true, it is evident the public nuisance

claim could not survive dismissal because plaintiff did not assert a different kind

of injury but instead the degree of the injury, namely, the increase in insurance

premiums and costs.

      Affirmed.


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