Mark P. Robinson, Jr., Bar No. 054426                                        

Sharon J. Arkin, Bar No. 154858                                       

ROBINSON, CALCAGNIE & ROBINSON            

620 Newport Center Drive, 7th Floor

Newport Beach, CA 92660

(949) 720-1288, Fax 720-1292

 

Arthur Bryant, Bar No. 208365

Victoria Ni, Bar No. 212443

TRIAL LAWYERS FOR PUBLIC JUSTICE

One Kaiser Plaza, Suite 275

Oakland, California 94612-3684

(510) 622-8150, Fax 622-8155

 

Thomas Grande[1]

Davis Levin Livingston Grande

851 Fort Street

Honolulu, Hawaii 96813

(808) 524-7500, Fax 545-7802

 

Attorneys for Plaintiffs

 

 

 

SUPERIOR COURT OF THE STATE OF CALIFORNIA

 

COUNTY OF ALAMEDA

 

 

 

AUDREY TIMMIS; LINDA GUDINO; WINSTON YARBOROUGH; MARY O’DONNELL; SHIRLEY MILLIGAN; MARY CARGILE; CHARLES PHILLIPS, M.D.; and CALIFORNIA CONSUMER HEALTH CARE COUNCIL, a California non-profit corporation,

 

                          Plaintiffs,

     vs.

 

KAISER PERMANENTE; KAISER FOUNDATION HEALTH PLAN, INC.; KAISER FOUNDATION HOSPITALS, INC.; THE PERMANENTE MEDICAL GROUP, INC; and DOES 1 through 100, inclusive,                                                                                                                            Defendants.

_______________________________

 

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

 

Case No. 833971-7

 

 

FIRST AMENDED COMPLAINT

 

1.                  Violations of the Unfair Competition  Act, California Business & Professions Code sections 17200, et seq.

 

2.                  Violations of the Unfair Competition Act, California Business & Professions Code sections 17500, et seq.

 

3.                  Violations of the Consumer Legal Remedies Act

 

 

 

 

 

                                                        GENERAL ALLEGATIONS

 


A.        INTRODUCTION

1.         The KAISER health system is the largest managed care entity in the country and markets itself as offering the highest quality care for its members.  KAISER  affirmatively represents in its marketing materials that its pharmacy and drug prescription program is based on safety, efficacy, patient convenience and quality of care and that cost is the “last consideration.”  KAISER further represents that the operations of the entire system is “in the hands of doctors.”  In reality, however, KAISER forces its out-patient members - many of whom are elderly and infirm - to accept prescribed medication in dosages twice the amount necessary for a single dose and requires them to split the pills in half in order to obtain their prescribed dosages.  Thus, the only way the patients can attempt to take the proper amount of medication is to split the pill as evenly as possible by hand or by using a tablet splitter to try to obtain the necessary single dose.

2.         In contrast, KAISER pharmacists, physicians and nurses are not required to split pills in the in-patient setting.  

3.         While KAISER contends that its pill-splitting program is voluntary and only involves splitting of appropriate medications, the KAISER reality is again different than represented.  In fact, patients are not given a choice about whether they want to split their medications, but are simply provided the double-dose medications and a pill-splitter, often without direction or instruction.  Even in the face of strenuous objections by the patient or the doctor, KAISER’s pharmacists and pharmacy managers oftentimes refuse to provide medication in single-dose form.


4.         Studies have demonstrated that pill-splitting of both scored and unscored pills in the method required by KAISER’s out-patient system results in uneven splits and, consequently, results in dangerous under- or over-dosages of medication.  KAISER patients required by KAISER to engage in pill-splitting have suffered real and appreciable injuries as the result of KAISER’s policy.  Some may have even died.   Contrary to KAISER’s public relations statements and written policy statements, the patient reality in the KAISER system is that patients are often required to split pills despite grave health risks associated with the practice.  Patients are forced to split pills even over their expressed objection, often without direction or instruction on how to properly split the tablets, without systematic follow-up to assure that they are receiving the proper dosages and without being informed, in advance, of the potential dangers in these practices.

5.         KAISER’s pill-splitting program provides no therapeutic benefit to KAISER’s patients.  The only purpose of the program is to increase KAISER’s operating profits, and, thereby, the bonuses paid to its management.  But KAISER pursues this program at the risk of injury and death to its members.  This pill-splitting policy is a sad example of KAISER valuing money over its members and their health.  This lawsuit seeks to stop this unfair and fraudulent program and to force KAISER to refund to its members the profits it illegally gained by forcing its members to split pills.

 

B.        THE PARTIES

6.         Plaintiff Audrey Timmis is a resident and citizen of the County of Fresno, State of California and brings this action individually and as a representative of other similarly-situated consumers pursuant to Civil Code section 1750, and on behalf of the general public pursuant to Business & Professions Code section 17200 and 17500.

7.         Plaintiff Linda Gudino is, and at all relevant times was, a resident of the County of  Fresno, State of California and brings this action individually and as a representative of other similarly-situated consumers pursuant to Civil Code section 1750, and on behalf of the general public pursuant to Business & Professions Code sections 17200 and 17500.

8.         Plaintiff Winston Yarborough is a resident and citizen of the County of Contra Costa, State of California and brings this action individually and as a representative of other similarly-situated consumers pursuant to Civil Code section 1750, and on behalf of the general public pursuant to Business & Professions Code sections 17200 and 17500.


9.         Plaintiff Mary O’Donnell is a resident and citizen of Kings County, California and brings this action individually and as a representative of other similarly-situated consumers pursuant to Civil Code section 1750, and on behalf of the general public pursuant to Business & Professions Code sections 17200 and 17500.

10.       Plaintiff Shirley Milligan is a resident and citizen of the County of Riverside, State of California and brings this action individually and as a representative of other similarly-situated consumers pursuant to Civil Code section 1750, and on behalf of the general public pursuant to Business & Professions Code section 17200.

11.       Plaintiff Mary “Polly” Cargile is a resident and citizen of the County of Santa Cruz, California and brings this action individually and as a representative of other similarly-situated consumers pursuant to Civil Code section 1750, and on behalf of the general public pursuant to Business & Professions Code sections 17200 and 17500.

12.       Plaintiff Charles Phillips, M.D. is a resident and citizen of the County of Fresno, State of California and brings this action on behalf of the general public pursuant to Business & Professions Code section 17204.   Dr. Phillip has been both a consumer of KAISER medication and a contract doctor for KAISER.  As a contract doctor for KAISER, Dr. Phillips treated KAISER patients who he believes suffered hypertensive episodes as the result of KAISER’s implementation and enforcement of its pill-splitting policy.

13.       Plaintiff CALIFORNIA CONSUMER HEALTH CARE COUNCIL (“CCHCC”) is a California non-profit, grassroots, volunteer-governed and operated, public benefit corporation. CCHCC acts as an advocate, in all available forums, to protect health care consumers from dangerous, deceptive, dishonest, unlawful or unfair practices. CCHCC has among its constituents all California consumers affected by Kaiser’s pill-splitting policies. Ensuring that existing laws, designed to protect consumers from the acts and practices with which Kaiser is charged, are fully and faithfully enforced is central to CCHCC’s purpose.


14.       Defendant, KAISER PERMANENTE (“KAISER PERMANENTE”) is, and at all relevant times was, a business entity whose form is unknown but which operates as a trade name and umbrella organization through which the operations of the other named defendants is controlled.

15.       Defendant KAISER FOUNDATION HEALTH PLAN, INC. (“KAISER HEALTH PLAN”) is, and at all relevant times was, a corporation duly organized and existing under and by virtue of the laws of the State of California and authorized to transact, and is transacting, business in the County of San Francisco.

16.       Defendant KAISER FOUNDATION HOSPITALS, INC. (“KAISER HOSPITALS”) is, and at all relevant times was, a corporation duly organized and existing under and by virtue of the laws of the State of California and authorized to transact business in this state, and is transacting  business, in the County of San Francisco.

17.       Defendant THE PERMANENTE MEDICAL GROUP, INC. (“KAISER MEDICAL GROUP”) is, and at all relevant times was, a corporation duly organized and existing under and by virtue of the laws of the State of California and authorized to transact business in this state, and is transacting business, in the County of San Francisco.


18.       Plaintiffs are informed and believe and thereon allege that defendant KAISER PERMANENTE is a holding company which either directly, or through its ownership in the stock of its wholly-owed subsidiaries, owns the whole or substantial portion of the stock of the other named defendants in this action, and that KAISER PERMANENTE controls the overall management and operations of other named defendants in this action such that KAISER PERMANENTE is the alter ego of the other named defendants.  Plaintiffs are further informed and believe and thereon allege that KAISER PERMANENTE is the head of an enterprise which is divided for operational purposes into various sectors and subsidiary corporations including, without limitation, the other named defendants.  Plaintiffs are further informed and believe and on that basis allege that KAISER PERMANENTE requires the various sectors and subsidiary corporations to direct revenues from those operational sectors and subsidiary corporations through the corporate ownership chain to KAISER PERMANENTE for the purpose, at least in part, of shielding those revenues from potential punitive damages claims based on the misconduct of the operational sectors or subsidiary corporations in engaging in their day-to-day operations as mandated or controlled by KAISER PERMANENTE.  To permit this conduct to shield revenues from assessment of punitive damages constitutes a fraud and injustice such that the corporate veil established by this enterprise should be pierced and the alter ego doctrine applied in the context of this action.  Because the named defendants are, or believed to be, alter egos of KAISER PERMANENTE, they will be referred to herein collectively as “KAISER.”

19.       The true names or capacities, whether individual, corporate, associate, or otherwise, of defendants DOES 1 through 100, inclusive, are unknown to plaintiffs, who therefore sue said defendants by such fictitious names.  Plaintiffs are informed and believe, and on such information and belief allege, that each of the defendants sued herein as a DOE is legally responsible in some manner for the events and happenings referred to herein, and will ask leave of this Court to amend this complaint to insert their true names and capacities in place and instead of the fictitious names when the same become known to plaintiffs.

20.       At all relevant times, defendants, and each of them, were the agents and employees of each of the remaining defendants, and were at all times acting within the purpose and scope of said agency and employment, and each defendant has ratified and approved the acts of his agent.

 

C.          KAISER’S REPRESENTATIONS

21.   KAISER is the largest managed care entity in the nation and markets itself as a health maintenance organization that offers the highest quality care for its members.  For example:

·                      KAISER touts in its marketing and advertising, the results of various surveys and accreditations regarding its quality.  (See Exhibit A.) 


·                      KAISER confirms in its own marketing materials that “KAISER Permanente members deserve the best!  (See Exhibit A; emphasis added.)

·                      KAISER markets its senior care plan to senior and Medicare members by promising to “always be there to protect” the senior care members, by promising to be “a plan you can rely on” and by promising to cover prescription drugs.   (See Exhibit B; emphasis added.)

·                      Similarly, KAISER promises its senior care members that the members’ doctors will be in charge of the medical care decisions for members, that the senior plan will make members “feel . . . safe,”and that patient care comes “first.”  (See Exhibit B; emphasis added.) 

·                      Additionally, KAISER represents on its Internet web site that the patient and the doctor make medical decisions, that KAISER is top-ranked in quality, that KAISER wants to be its members’ “complete health partner,” that it provides “top quality care,” that KAISER has a “tradition of caring for your good health,” and that it is committed “to principles of quality” and to “continuously improving the clinical care and services” it provides.  (See Exhibit C; emphasis added.)

·                      KAISER further represents on its Internet web site that its drug formularies are developed “to ensure that the most appropriate and highest quality pharmaceuticals are available for treating its members” and that the formularies are “doctor-driven, quality-basedprograms.  (See Exhibit C; emphasis added.)  Additionally, KAISER represents that its formulary principles are based on factors such as “safety, efficacy; patient convenience . . . quality of care” and the like and that cost is the “last consideration.”  (See Exhibit C, emphasis added.)

·                      KAISER represents in its letters to subscribers that “Physicians stay with KAISER Permanente because of the freedom they have to prescribe medicine the way medicine should be practiced.  At KAISER Permanente, no clerk or gatekeeper is consulted when your physician . . . prescribes medication” because “KAISER Permanente members deserve the best!”  (See Exhibit D, October 15, 1999 letter from Robert Pearl, M.D. and Richard Pettingill; emphasis added; Exhibit A.)


D.        THE KAISER REALITY

22.       KAISER acknowledges that it does have a written program and policy regarding pill-splitting by its members.  KAISER asserts that the pill-splitting program is wholly voluntary, that it applies only to medications which have been demonstrated to be appropriate for splitting, that KAISER’s patients are properly trained in how to split the pills and that if the patient or the patient’s doctor objects to the pill splitting, the patient will be provided with the single-dose version of the prescribed medication.  The reality of how KAISER actually operates its pharmacy practice, however, belies each of the representations set forth in the preceding paragraphs and KAISER’s own representations about its pill-splitting policy. 

23.       Certain prescription medications are distributed by pharmaceutical manufacturers in the form of “scored” tablets which have an indentation on their surfaces for the purpose of permitting the tablet to be split, usually done using a small plastic device containing a razor edge, known as a “tablet-splitter” or “pill-splitter”.  These tablets are scored in order to allow small-step increases in dosage until the proper and most effective dosage is obtained, a process known as dose titration. 

24.       Other tablets, however, are not amenable to or appropriate for pill-splitting under any circumstances and are not, therefore, scored by the manufacturer.  Sustained release medications and coated medications, for example, are not intended to be split.  Many other medications should not be split because splitting cannot provide the accurate dosages necessary to treat the patient’s condition.  Additionally, the splitting of some tablets causes the tablets to shatter into several unequal pieces or to crumble, thus leaving the patient completely unable to ensure that accurate dosages are being taken.  Indeed, small fragments that frequently result from pill-splitting are virtually never consumed, and finger moisture and oils contaminate split surfaces, changing the effectiveness and/or actual dosage of the medication.  As such, these medications are not provided by manufacturers in a scored form and should never be split.


25.       “Pill-splitting,” as the term is used in this complaint, consists of KAISER’s practice of providing prescription medication to members in tablets that contain twice the single dosage prescribed by the members’ treating physicians and then requiring its members to manually split the pills to obtain the required single-dose form of their medication.  Often, the members are not trained on how to most appropriately split the pills and, even with adequate training, many of the tablets still shatter, crumble or split unevenly, leaving the patient with inconsistent and over-dosages or under-dosages.

26.       Three years ago, borrowing from a financially-successful, but entirely untested, experiment conducted by the San Diego Veterans Hospital, KAISER’s Central Pharmacy and Therapeutics Committee (“the Committee”) decided that KAISER’s then-existing policy of having patients split scored tablets could be expanded into an entirely new area - the splitting of unscored tablets with the aid of pill-splitters originally designed only for the splitting of scored tablets.  The Committee created a list of unscored tablets which could be split, a copy of which is attached as Exhibit E. 

27.       Although the Committee and KAISER did not make the pill-splitting policy technically “mandatory” with respect to its use by pharmacists and pharmacy managers, the reality is that, as a result of KAISER’s “productivity bonus” system in place with respect to each professional employee, financial pressure was applied to drive  KAISER’s pharmacists and pharmacy managers to accept and implement the pill-splitting protocol, despite objections from patients and contrary to instructions from patients’ prescribing doctors. 

28.       When doctors become employed by KAISER, included in their employment agreements is a provision requiring them to conform to KAISER’s policies, including its pharmacy policy.  That generic agreement is used by KAISER as its justification for permitting KAISER pharmacists to alter the prescriptions as written by the doctors in order to dispense prescribed medication in double dose amounts.


29.       As a result, KAISER members throughout the KAISER system in California, and elsewhere, are forced to engage in “pill-splitting” in order to attempt to obtain the proper dose of their medications and are therefore exposed to the health risks associated with taking inconsistent dosages.

30.       Additional health dangers also result from the fact that the pill-splitting requirement may not be consistently applied to the same patient from refill to refill.  KAISER purchases pharmaceuticals under various contracts with various drug companies.  Based on the particular contract for a particular medication, KAISER may at times obtain the same medication in the lower-dose form and dispense that lower-dose form to a patient that has previously been dispensed the higher-dose form of the medication.  Thus, over the course of a single patient’s refills, the patient may change brands and move from split pills back to whole pills and back to split pills.  The inconsistency enhances the risk and danger to the patient.

31.       All these dangers are exacerbated by the fact that KAISER does not perform any follow-up on the patients subject to these pill-splitting requirements to determine or correct any negative effects of the practice.  The practices engaged in by KAISER as described herein actually deprive KAISER members of safe, effective and convenient medication systems.

32.       The American Medical Association, the California Pharmacists Association,  the American Society of Consultant Pharmacists and many pharmaceutical manufacturers, advise against such pill splitting.  Additionally, the FDA has testified to an AMA subcommittee against large-scale pill-splitting and that approved dosage and form should not be altered in post-market stages. 


33.       Studies have shown that even the splitting of scored tablets can result in dosage variances of up to 20% from ideal dosage (see Exhibit F), which can be extremely dangerous with respect to certain medications, particularly blood pressure medications.  For example, plaintiff Charles Phillips, M.D., as a contract doctor providing emergency room services to KAISER patients in the Fresno area over an 18-month period, was repeatedly required to treat KAISER patients on an emergency basis for hypertensive crises due, in part, to under-dosing caused by KAISER’s pill-splitting requirements.  Dr. Phillips confirmed the role of KAISER’s pill-splitting requirements in contributing to the patients’ condition in these cases by actually observing the patients’ leftover pill fragments rather than merely relying on computer summaries of the patient’s medical care through KAISER. 

34.       Requiring the splitting of unscored pills has no therapeutic or safety benefit to the patient.  Indeed, as demonstrated in the relevant studies, splitting of unscored pills can actually represent a medical danger to patients because it can result in uneven dosing or under-dosing.  The only reason KAISER requires its members to split their medication tablets is for the purpose of increasing KAISER’s revenue and its professional management’s bonuses. 

35.  For example, Prinivil, a blood pressure medication, is available in 20-milligram tablets and 40-milligram tablets.  The cost for 100 of the 20-milligram tablets is $100.25.  The cost for 100 of the 40-milligram tablets is $143.53.  Thus, by dispensing 100 40-milligram tablets to a member, and requiring the member to split the tablets in order to obtain 200 20-milligram doses, KAISER increases its profits by $56.72, while causing inconvenience and potential medical problems to its member.  

36.  Similarly, Zoloft, a commonly-used anti-depressant, comes in both 50-milligram tablets and 100-milligram tablets.  The cost for 100 of the 50-milligram tablets is approximately $227.14, while the cost for 100 of the 100-milligram tablets is approximately $233.70.  Thus, by dispensing 100 100-milligram tablets to the member and requiring the member to split the tablets in order to obtain 200 50-milligram doses, KAISER increases its profits by $220.58 on that prescription.

37.       It has been estimated that KAISER increases its profits by approximately $4 to $5 million per year in California alone with respect to a single blood pressure medication that it requires its members to split. 


38.  Prior to July 1, 2000, plaintiff Audrey Timmis was a member of KAISER's health care plan.  Ms. Timmis is an emphysema patient whose KAISER physician prescribed a diuretic, Triamterene/HCTZ, a generic form of Maxide, as, on information and belief, a first-line treatment for her high blood pressure.  The KAISER pharmacy, in conformance with the misleading, deceptive and unlawful policy described above, provided Ms. Timmis her medication in a double dosage and required her to split the medication, without instructions and without a pill-splitter, despite the fact that the medication is available in the prescribed dosage.  This generic form of Maxide is small, round and very crumbly.  Ms. Timmis's husband split the medication for Ms. Timmis by hand and the splitting resulted in unequal fragments.

39.       Plaintiff Linda Gudino is, a 59-year-old woman who has been a KAISER member for at least the last three years.  From the inception of her KAISER membership, Ms. Gudino has been required by KAISER, as part of its misleading, deceptive and unlawful policy described above,  to split her medication, and she never received any oral instructions or training on how to properly split the medication and was never, to her knowledge, assessed by any KAISER pharmacist or doctor as to whether she was an appropriate candidate for pill-splitting.  KAISER requires Ms. Gudino to split 50 mg tablets of Tenormin (atenalol), a small, round tablet for controlling blood pressure and treating cardiac conditions, in order to obtain her 25 mg per day dosage.  Additionally, Ms. Gudino is required to split 5 mg tablets of Provera in order to obtain her 2.5 mg daily dosage.  Provera is a progesterone hormone replacement and comes in a very small, six-sided tablet that is very difficult to split and which tends to crumble.


40.       Plaintiff Winston Yarborough is a 64-year-old man suffering from essential tremor disease, who has long been prescribed lisinopril to treat his high blood pressure.  Mr. Yarborough has been a member of KAISER since 1967 and is now enrolled in KAISER’s "Senior Advantage" program.  In or around November 1999, as part of KAISER’s misleading, deceptive and unlawful policy described above, Mr. Yarborough was given a new prescription for Zestril (lisinopril) in 40 mg tablets, and instructed to split his medication to obtain a 20 mg/day dosage, despite the fact that his essential tremor disease made splitting the tablets extremely difficult.  Mr. Yarborough was never provided with any oral instructions or training on how to properly split the medication and was never, to his knowledge, assessed by any KAISER pharmacist or doctor as to whether he was an appropriate candidate for pill-splitting.  In August, 2000, Mr. Yarborough obtained a refill of his prescription and was dispensed Prinivil (another brand  of lisinopril), but, this time, was given 20 mg tablets.  Because his prescribed daily dosage was 20 mg, he should have been instructed that he did not need to split those tablets.  But in dispensing the medication, the KAISER pharmacy provided no such instructions, and Mr. Yarborough continued to split the tablets supplied in new prescription and was, unbeknownst to him, actually taking 10 mg per day, or only half of his prescribed dosage.

41.       Plaintiff Mary O’Donnell was a KAISER member for many years before finally choosing to leave KAISER in May, 1999.  During 1998 and 1999, Ms. O’Donnell was prescribed Zestril (40 mg), Lasix and Paxil (40 mg) by her KAISER doctor and was required by KAISER’s pharmacy to split the pills in order to obtain the single-dose amounts.  Ms. O’Donnell is on oxygen almost continuously and the bronchodialators she is required to use make her very tremulous, thus making it even more difficult for her to split her medications.  Ms. O’Donnell’s daughter specifically requested that KAISER dispense Ms. O’Donnell’s medications in single-dose dosages so that the pills would not have to be split.  KAISER refused the request.


42.  Plaintiff Shirley Milligan is, and at all relevant times was, a member of KAISER’s health plan program through premiums paid by her or on her behalf.  During the last four years, plaintiff Shirley Milligan has received medication prescriptions from her KAISER doctor for captopril, a generic form of Capotan, at 12.5 mg. per dose.  Captopril is a short-acting medication for treatment of high blood pressure.  In conformance with the policy as alleged above, KAISER pharmacies dispensed double-dose tablets to plaintiff Shirley Milligan, expecting her to split those tablets in order to attempt to obtain the correct dosage of her medication, without even informing her that the pills were double her usual dose, without notifying her that she should split her pills and without providing her with a pill-splitter.  It was only by chance that Ms. Milligan compared her new prescription bottle with her old prescription bottle and noticed that the pills were double the usual dose.  Upon contacting the KAISER pharmacy involved, the pharmacy informed her that it was out of her usual dose and asked her if she could just split the pills.  Ms. Milligan protested and, only then, was provided with the usual 12.5 mg pills she was used to taking. 

43.       Plaintiff Mary "Polly" Cargile is, and at all relevant times was, a KAISER member who, at all relevant times, suffered from essential tremor disease, which causes her hands to shake uncontrollably.  Because of this impairment, it is virtually impossible for Ms. Cargile, no matter how careful she is, to accurately and effectively split tablets, whether scored or unscored.  Despite her infirmity, KAISER insisted, as part of its misleading, deceptive and unlawful policy described above, on and dispensing to Ms. Cargile Diamox, a medication to treat her tremors, in 250 mg tablets, even though she needed only 125 mg per dose.  KAISER required Ms. Cargile to split the Diamox 250 mg tablets even though the medication was also available in a 125 mg dose.

44.       During the last four years, plaintiff Charles Phillips, M.D., a Board Certified Emergency Physician has personally treated many patients who he believes have suffered physical injury as the result of this practice on the part of KAISER.  Additionally, plaintiff Charles Phillips, M.D., as a contract doctor working for KAISER, was entitled to utilize KAISER’s pharmacy services.  As such, during the last four years, Dr. Phillips prescribed medication for himself which did not come in a scored form (lisinopril, 20 mg.) and submitted one prescription to the KAISER pharmacy to be filled.  Dr. Phillips was provided, after the usual wait, with tablets containing a double dosage (i.e., 40 mg.) of the prescribed medication and a pill-splitter by the KAISER pharmacist.  When Dr. Phillips objected to the requirement that he split the tablets and that the prescription called for the lower-dose tablets, he was informed that the double-dose tablets and the splitter were the only available option for him.  Upon further discussion, he was given a copy of the KAISER policy out of Oakland regarding pill-splitting (Exhibit E).  Upon later inquiry to KAISER’s Oakland headquarters regarding the pill-splitting policy, Dr. Phillips was faxed information from KAISER to the effect that no research had been done by KAISER prior to implementing the pill-splitting decision.  (Exhibit G.)


45.       As these examples illustrate, the reality of how KAISER operates its pharmacy practices belies its promises of safety and efficacy with respect to its members’ care.

FIRST CAUSE OF ACTION

(Violations of Business & Professions Code section 17200, et seq.)

PLAINTIFFS, AND EACH OF THEM, FOR A FIRST CAUSE OF ACTION AGAINST DEFENDANTS, AND EACH OF THEM, FOR VIOLATIONS OF BUSINESS & PROFESSIONS CODE SECTION 17200, ET SEQ., ALLEGES:

46.       Plaintiffs, and each of them,  incorporate by reference each and every paragraph of the General Allegations as though set forth in full in this cause of action.

47.       Plaintiffs are informed and believe and thereon allege that KAISER has engaged in unlawful, unfair or fraudulent misconduct in violation of Business & Professions Code section 17200 including, without limitation, the following:

a.         Misrepresenting to consumers the quality of medical care and services provided by KAISER to its members at a time when KAISER, in fact, engages in pharmacy practices which are inconvenient and unsafe for its members and which are engaged in by KAISER for the sole purpose of increasing KAISER’s revenues;

b.         Misrepresenting to consumers that medical decisions are made solely by doctors and the members without administrative interference when, in fact, neither doctors nor patients can override the pharmacy policy requiring that medication be dispensed in double-doses and be split for use by the patient - all for the sole purpose of increasing KAISER’s revenues;

c.         Forcing members to engage in pill-splitting of unscored medications while knowing that such conduct subjects its members to certain inconvenience and potential physical injury - all for the sole purpose of increasing KAISER’s revenues.


d.         Requiring patients to split scored or unscored pills without 1) an adequate screening to determine the physical and/or psychological ability of each patient to perform the task; 2) adequate individual training; 3) individual follow-up that assures that each patient is actually consistently obtaining the prescribed dosage and is not suffering any other inconvenience or adverse effect as the result of these practices; and 4) informing each patient, in advance, of the potential risks involved in these practices.

48.       Accordingly, plaintiffs, on behalf of the general public and pursuant to Business & Professions Code section 17204 hereby seek the following remedies with respect to KAISER’s unfair business practices as alleged above:

a.         An injunction against defendants, and each of them, precluding them from engaging in these unfair business practices in the future;

b.         Restitutionary relief as determined to be appropriate by the Court;

c.         Any other and further equitable relief deemed necessary by the Court, pursuant to the power granted to it under Business & Professions Code section 17203 including, without limitation, disgorgement of illegally-gained profits; and,

d.         Reasonable attorneys' fees and costs upon prevailing in the request for injunctive and/or equitable relief.

 

SECOND CAUSE OF ACTION

(Violations of Business & Professions Code section 17500, et seq.)

PLAINTIFFS, AND EACH OF THEM, FOR A SECOND CAUSE OF ACTION AGAINST DEFENDANTS, AND EACH OF THEM, FOR VIOLATIONS OF BUSINESS & PROFESSIONS CODE SECTION 17500, ET SEQ., ALLEGES:

49.       Plaintiffs, and each of them, incorporate by reference each and every paragraph of the General Allegations as though set forth in full in this cause of action.

50.       Plaintiffs are informed and believe and thereon allege that KAISER has violated the provisions of Business & Professions Code section 17500, et seq., by making, disseminating or causing to be made or disseminated from this state, before the public, statements concerning the services it offered to provide which statements were untrue or misleading and which statements KAISER knew, or in the exercise of reasonable care should have known, were untrue or misleading, or disseminated or caused to be disseminated such advertising with the intent not to sell such services as advertised. 


51.       Accordingly, plaintiffs, on behalf of the general public and pursuant to Business & Professions Code section 17535, hereby seek the following remedies with respect to KAISER’s false, fraudulent and misleading advertising as alleged above:

a.         An injunction against defendants, and each of them, precluding them from engaging in these unfair business practices in the future;

b.         Restitutionary relief as determined to be appropriate by the Court;

c.         Any other and further equitable relief deemed necessary by the Court, pursuant to the power granted to it under Business & Professions Code section 17535 including, without limitation, disgorgement of illegally-gained profits; and,

d.         Reasonable attorneys' fees and costs upon prevailing in the request for injunctive and/or equitable relief.

 

THIRD CAUSE OF ACTION

(Violations of the Consumer Legal Remedies Act)

PLAINTIFFS AUDREY TIMMIS, LINDA GUDINO, WINSTON YARBOROUGH, MARY O’DONNELL, SHIRLEY MILLIGAN AND  MARY “POLLY” CARGILE FOR A THIRD CAUSE OF ACTION AGAINST DEFENDANTS, AND EACH OF THEM, FOR VIOLATIONS OF THE CONSUMER LEGAL REMEDY ACT, ALLEGES:

52.       Plaintiffs Audrey Timmis, Linda Gudino, Winston Yarborough, Mary O’Donnell, Shirley Milligan and Mary “Polly” Cargile incorporate by reference each and every paragraph of the General Allegations as though set forth in full in this cause of action.

53.   Plaintiffs are informed and believe and thereon allege that the actions by KAISER alleged in this action constitute violations of the provisions of the Consumer Legal Remedy Act (“CLRA”) including, without limitation, Civil Code section 1770, subdivisions (5), (7), (9), (14) and (16).


54.  Because the violations of the CLRA as alleged have resulted in cost savings to KAISER, KAISER’S members have been forced to pay excessive amounts for the medical care, treatment and coverage contracted for under KAISER’s plans.  As such, KAISER should be required to rebate to its members the savings generated by KAISER through the use of this unfair business practice. 

55.  Plaintiffs hereby bring this cause of action on behalf of themselves and other consumers who are similarly situated pursuant to Civil Code section 1781.  The class, for purposes of this action, is defined as each person who has been enrolled as a member of KAISER during the last four years.  This matter is brought on a class action basis on the grounds that:

a.  It is impracticable to bring all members of the class before the Court;

b.  The questions of law or fact common to the class are substantially similar and predominate over the questions affecting the individual members;

c.  The claims or defenses of the representative plaintiffs are typical of the claims or defenses of the class; and,

d.  The representative plaintiffs will fairly and adequately protect the interests of the class.

56.       Plaintiffs, on behalf of themselves and all others similarly situated, therefore seek an order awarding damages pursuant to Civil Code section 1780 including, without limitation, actual damages in an amount to be determined at the time of trial, injunctive relief to preclude KAISER from dispensing unscored tablets with instructions to its members to split the tablets or scored tablets except for the limited purpose of dose titration, damages and/or restitution of property in an amount to be determined at the time of trial; and costs and attorneys’ fees pursuant to Civil Code section 1780(d).

57.     Plaintiffs are senior citizens as defined in Civil Code section 1761 and hereby seek, in addition to the other remedies alleged herein, an additional penalty pursuant to Civil Code section 1780(b) and seek such penalty on behalf of themselves and the other class members who are also senior citizens or disabled persons as defined in Civil Code section 1761.


58.       Defendants' conduct described herein was intended by the defendants to cause injury to plaintiffs or was despicable conduct carried on by the defendants with a willful and conscious disregard of the rights of plaintiffs, or subjected plaintiffs to cruel and unjust hardship in conscious disregard of plaintiffs’ rights, or was an intentional misrepresentation, deceit, or concealment of a material fact known to the defendants with the intention to deprive plaintiffs of property, legal rights or to otherwise cause injury, such as to constitute malice, oppression or fraud under California Civil Code section 3294, thereby entitling plaintiffs to punitive damages in an amount appropriate to punish or set an example of defendants.

59.       Defendants' conduct described herein was undertaken by each corporate defendant's officers or managing agents, identified herein as DOES 1 through 100, who were responsible for claims supervision and operations, underwriting, communications and/or decisions.  The aforedescribed conduct of said managing agents and individuals was therefore undertaken on behalf of the corporate defendant.  Said corporate defendant further had advance knowledge of the actions and conduct of said individuals whose actions and conduct were ratified, authorized, and approved by managing agents whose precise identities are unknown to plaintiff at this time and are therefore identified and designated herein as DOES 1 through 100, inclusive.

 

WHEREFORE, plaintiff prays for judgment against defendants, as follows

 

AS TO THE FIRST CAUSE OF ACTION:

1.         For injunction against defendants; 

2.         For any other and further equitable relief deemed necessary by the Court, including, without limitation, restitutionary relief and/or disgorgement of illegally-gained profits;

3.         For attorneys' fees and costs upon prevailing in the request for injunctive and/or equitable relief;

AS TO THE SECOND CAUSE OF ACTION

4.                  For injunction against defendants; 


5.         For any other and further equitable relief deemed necessary by the Court, including, without limitation, restitutionary relief and/or disgorgement of illegally-gained profits;

6.         For attorneys' fees and costs upon prevailing in the request for injunctive and/or equitable relief;

 

AS TO THE THIRD CAUSE OF ACTION

7.         For actual damages in an amount to be determined at the time of trial;

8.         For restitutionary relief;

9.         For injunctive relief;

10.       For penalties pursuant to Civil Code section 1780(b);

11.       For punitive damages;

12.       For costs and attorneys’ fees pursuant to Civil Code section 1780(d);

 

AS TO EACH CAUSE OF ACTION

13.       For costs of suit incurred herein; and

14.       For such other and further relief as the Court may deem just and proper.

 

Dated: April 22, 2001

ROBINSON, CALCAGNIE & ROBINSON

TRIAL LAWYERS FOR PUBLIC JUSTICE

DAVIS LEVIN LIVINGSTON GRANDE

 

By: _____________________________

MARK P. ROBINSON, JR.

SHARON J. ARKIN

ARTHUR BRYANT

Attorneys for Plaintiffs                                                          



[1]  To be admitted pro hac vice.  Motion pending