Beeman v. Anthem Prescription Mgmt.

Plaintiffs were five independent retail pharmacies licensed in California, and Defendants were prescription drug claims processors. In 2002, Plaintiffs filed a federal class action suit alleging that Defendants failed to comply with Cal. Civil Code 2527, which requires prescription drug claims processors to compile and summarize information on pharmacy fees and transmit that information to their clients. The district court dismissed the cases for lack of standing without reaching the merits. On appeal, the Ninth Circuit Court of Appeals concluded that Plaintiffs had standing, reversed the district court, and remanded. On remand, Defendants moved for judgment on the pleadings, contending that section 2527 unconstitutionally compels speech in violation of the California and U.S. Constitutions. The district court denied the motions. On appeal, the Ninth Circuit asked the California Supreme Court to answer a question of state law. The Supreme Court answered by holding (1) section 2527 implicates the right to free speech guaranteed by the California Constitution and is subject to rational basis review; and (2) the statute satisfies that standard because the compelled factual disclosures are reasonably related to the Legislature's legitimate objective of promoting informed decisionmaking about prescription drug reimbursement rates. View "Beeman v. Anthem Prescription Mgmt." on Justia Law