Clayworth v. Abbott Laboratories CA1/4

California Court of Appeal May 29, 2014 No. A132527Unpublished

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Holding. The court held that prevailing parties are entitled to recover costs as a matter of right under Code of Civil Procedure section 1032, even if a prior judgment and associated cost award were reversed on appeal. It further held that the denial of a judicial disqualification motion is not an appealable order and cannot be repeatedly challenged.

Issues

Whether a prevailing party is entitled to recover costs after a prior judgment and cost award were reversed on appeal.
Whether the trial court erred in awarding costs without ruling on specific evidentiary objections to a supporting declaration.
Whether the denial of a motion to disqualify a trial judge can be challenged on appeal after a prior unsuccessful writ petition.

Disposition. affirmed

Quotations verified verbatim against the opinion

“Section 1032, subdivision (b) provides that “a prevailing party is entitled as a matter of right to recover costs in any action or proceeding.””

“An award of costs is “merely incidental” to a judgment, “and an order awarding costs falls with a reversal of that part of the judgment upon which it is based.””

“After a judgment is reversed, the issue of costs is “set at large.””

Filed 5/29/14 Clayworth v. Abbott Laboratories CA1/4 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION FOUR

JAMES R. CLAYWORTH et al., Plaintiffs and Appellants, A132527 v. ABBOTT LABORATORIES et al., (Alameda County Super. Ct. No. RG04172428) Defendants and Respondents.

Appellants are a group of retail pharmacies who sued various drug companies for state antitrust violations. They make two claims in this appeal. First, they argue that the drug companies, which ultimately prevailed in the litigation, should not have been awarded their costs because an earlier motion for summary judgment filed by the drug companies was granted below but reversed on appeal. Second, they claim—for the third time in the Court of Appeal—that a motion they filed to disqualify a trial judge was improperly denied. Their arguments are without merit, and we affirm. I. FACTUAL AND PROCEDURAL BACKGROUND The factual background of this case has been summarized in three previous opinions: two by Division Two of this court and one by the California Supreme Court. (Clayworth v. Pfizer, Inc. (2008) previously published at 165 Cal.App.4th 209 (Clayworth I), review granted Nov. 19, 1008, opn. ordered nonpub., and revd. in Clayworth v. Pfizer, Inc. (2010) 49 Cal.4th 758 (Clayworth II); Clayworth v. Pfizer, Inc.

(Aug. 22, 2012, A131804 [nonpub. opn.] (Clayworth III).)1 We recount here only the facts that are relevant to the narrow issues in this appeal. The pharmacies filed this suit against the drug companies2 alleging that they conspired to fix prices to reap a higher profit from the sale of drugs sold in the United States than from the sale of the same drugs in Canada. They asserted that this price fixing violated the Cartwright Act (Bus. & Prof. Code, § 16720 et seq.) and the Unfair Competition Law (Bus. & Prof. Code, § 17200 et seq.). During discovery, evidence revealed that the drug companies’ alleged overcharges had been passed on by the pharmacies to their customers. The drug companies filed a motion based on this evidence arguing that under California law the “pass-on” of charges entitled them to summary judgment. This pass-on defense is generally unavailable under federal antitrust law, but at the time of the motion it was unsettled whether it was available under state 1 On the court’s own motion, we take judicial notice of Clayworth I and Clayworth III, as well as the records in Appeal Nos. A118473, A118488, A118496, A119167, and A130516, discussed post. 2 Plaintiffs/appellants are James Clayworth, R.Ph., an individual, dba Clayworth Pharmacy; Marin Apothecaries, Inc., dba Ross Valley Pharmacy; Golden Gate Pharmacy Services, Inc., dba Golden Gate Pharmacy; Pediatric Care Pharmacy, Inc.; Chimes Pharmacy, Inc.; Mark Horne, R.Ph., an individual, dba Burton’s Pharmacy; Meyers Pharmacy, Inc.; Benson Toy, R.Ph., an individual, dba Marin Medical Pharmacy; Seventeen Fifty Medical Center Pharmacy, Inc.; Jack’s Drug Store and Medical Supplies, Inc.; Julian Potashnick, R.Ph., an individual, dba Leo’s Pharmacies; Jerry Shapiro, R.Ph., an individual, dba Uptown Drug, Co.; Tilley Apothecaries, Inc., dba Zweber’s Apothecary; RP Healthcare, Inc.; Rohnert Park Drugs, Inc.; JGS Pharmacies, Inc., dba Dollar Drugs; and California Pharmacy Systems, Inc. Defendants/respondents are Abbott Laboratories; Allergan, Inc.; Amgen Inc.; AstraZeneca LP; Boehringer Ingelheim Pharmaceuticals, Inc.; Bristol-Myers Squibb Company; Eli Lilly and Company; GlaxoSmithKline plc; Hoffmann-La Roche Inc.; Johnson & Johnson Health Care Systems Inc. (a distribution arm for the operating companies of Johnson & Johnson); Janssen Pharmaceuticals Inc.; Ortho-McNeil Pharmaceutical, Inc.; Ortho Biotech Inc.; Merck Sharp and Dohme Corp., formerly known as Merck & Co., Inc.; Novartis Pharmaceuticals Corporation; Pfizer Inc.; Pharmaceutical Research and Manufacturers of America (PhRMA); and Wyeth LLC, formerly known as Wyeth. Although PhRMA is a nonprofit trade association of which all defendants are members and does not itself manufacture drugs, we will refer collectively to respondents as “drug companies” in the interest of simplicity.

Clayworth v. Abbott Laboratories CA1/4

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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION FOUR

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