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Tonkinson v. Byrd

United States District Court, D. New Jersey

April 24, 2018


          ALAN H. SCHORR, ALAN H. SCHORR & ASSOCIATES, PC On behalf of Plaintiff



          NOEL L. HILLMAN, U.S.D.J.

         This case concerns Plaintiff's claims against her former employer arising out of her alleged whistleblowing activity related to compliance audits for a federal prescription drug program. Before the Court are Defendants' motions to dismiss Plaintiff's complaint, and if the complaint is not dismissed in its entirety, to transfer venue to the Western District of Texas.

         For the reasons expressed below, Defendants' motion to dismiss will be granted in part and denied in part, and Defendants' motion to transfer venue will be denied.


         According to her complaint, Plaintiff, Lisa L. Tonkinson, signed her employment contract with Defendant NEC Network, LLC d/b/a CaptureRx (“CaptureRx”), a company based in Texas, on December 3, 2015, with her first day of work beginning on January 4, 2016. Plaintiff relates that she worked out of her home office in New Jersey as a consultant on behalf of CaptureRx for its Health Resources and Services Administration (“HRSA”) 340B prescription drug program.

         HRSA is a governmental program that requires prescription drug manufacturers to provide outpatient medications to eligible health care organizations at significantly reduced prices. Plaintiff relates that she prepared reports for clients and then advised clients on how to improve or fix any deficiencies that existed with relation to the 340B drug program. Plaintiff further asserts that independent audits are required by law, and hospitals are required to show the independent audits to HRSA 340B inspectors upon request.

         Plaintiff's claims arise out of her 340B consulting services for the New York City Health and Hospitals Corporation (“NYCHH”). Plaintiff contends that her NYCHH reports were very thorough and noted several deficiencies and violations of law that could and would negatively affect NYCHH. She alleges those violations were severe enough to potentially lead to fines and even disqualification of NYCHH from the 340B program if a government audit was conducted and found the same deficiencies.

         Plaintiff alleges that NYCHH insisted that she modify the independent audit to remove references to many of the deficiencies in her report. She claims that she refused to modify her report because her data was correct, and she believed that changing the report would unlawfully and fraudulently hide deficiencies, that if left unattended, would break the law.

         Plaintiff contends that Defendants, which in addition to CaptureRX also include PatientCraft, LLC (“PatientCraft”), Holly Russo, Becky Simeon, David Byrd, and Christopher Hotchkiss, received complaints from NYCHH that Plaintiff would not remove the deficiencies from her report. Plaintiff claims that Defendants then began to exert pressure upon her to change the report to reflect that NYCHH was complying with the law, but she refused to do so. Plaintiff alleges that her employment was terminated on September 6, 2016 as a result of her refusal to change the report and violate the law by doing so.

         After her termination, Plaintiff claims that unbeknownst to her Defendants changed her report as requested by NYCHH and affixed her name to the modified report. Plaintiff relates that NYCHH was subsequently audited by the government, which found NYCHH to be noncompliant in the very ways Plaintiff herself had found. Plaintiff further claims that when she secured new employment with Johns Hopkins University Hospitals, Defendant Russo provided disparaging information about her to one of their contractors, who then refused to work with Plaintiff, and she lost the contract.

         Plaintiff claims that Defendants' actions violate the New Jersey's Conscientious Employee Protection Act, N.J.S.A. 34:19-1 et seq. (“CEPA”) (Count One), and constitute fraudulent misrepresentation (Count Two), appropriation of name for commercial advantage (Count Three), tortious interference with employment and prospective economic advantage (Count Four), and defamation (Count Five).

         Defendants have moved to dismiss all counts in Plaintiff's complaint, arguing that they fail to state any cognizable claims against them. Defendants have also moved to change the venue of Plaintiff's case to the Western District of Texas. Plaintiff has opposed both of Defendants' motions.


         A. Subject matter jurisdiction

         Defendants removed this action from New Jersey state court to this Court pursuant to 28 U.S.C. § 1441. This Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1332 because there is complete diversity of citizenship between the parties and the amount in controversy exceeds $75, 000. Plaintiff if a citizen of New Jersey, and none of the Defendants are citizens of New Jersey. (See Docket No. 10-4.)

         B. Standard for Motion to Dismiss

         When considering a motion to dismiss a complaint for failure to state a claim upon which relief can be granted pursuant to Federal Rule of Civil Procedure 12(b)(6), a court must accept all well-pleaded allegations in the complaint as true and view them in the light most favorable to the plaintiff. Evancho v. Fisher, 423 F.3d 347, 351 (3d Cir. 2005). It is well settled that a pleading is sufficient if it contains “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). Under the liberal federal pleading rules, it is not necessary to plead evidence, and it is not necessary to plead all the facts that serve as a basis for the claim. Bogosian v. Gulf Oil Corp., 562 F.2d 434, 446 (3d Cir. 1977).

         However, “[a]lthough the Federal Rules of Civil Procedure do not require a claimant to set forth an intricately detailed description of the asserted basis for relief, they do require that the pleadings give defendant fair notice of what the plaintiff's claim is and the grounds upon which it rests.” Baldwin Cnty. Welcome Ctr. v. Brown, 466 U.S. 147, 149-50 n.3 (1984) (quotation and citation omitted).

         A district court, in weighing a motion to dismiss, asks “‘not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claim.'” Bell Atlantic v. Twombly, 550 U.S. 544, 563 n.8 (2007) (quoting Scheuer v. Rhoades, 416 U.S. 232, 236 (1974)); see also Ashcroft v. Iqbal, 556 U.S. 662, 684 (2009) (“Our decision in Twombly expounded the pleading standard for ‘all civil actions' . . . .”); Fowler v. UPMC Shadyside, 578 F.3d 203, 210 (3d Cir. 2009) (“Iqbal . . . provides the final nail-in-the-coffin for the ‘no set of facts' standard that applied to federal complaints before Twombly.”).

         Following the Twombly/Iqbal standard, the Third Circuit has instructed a two-part analysis in reviewing a complaint under Rule 12(b)(6). First, the factual and legal elements of a claim should be separated; a district court must accept all of the complaint's well-pleaded facts as true, but may disregard any legal conclusions. Fowler, 578 F.3d at 210 (citing Iqbal, 129 S.Ct. at 1950). Second, a district court must then determine whether the facts alleged in the complaint are sufficient to show that the plaintiff has a “‘plausible claim for relief.'” Id. (quoting Iqbal, 129 S.Ct. at 1950). A complaint must do more than allege the plaintiff's entitlement to relief. Id.; see also Phillips v. Cnty. of Allegheny, 515 F.3d 224, 234 (3d Cir. 2008) (stating that the “Supreme Court's Twombly formulation of the pleading standard can be summed up thus: ‘stating . . . a claim requires a complaint with enough factual matter (taken as true) to suggest' the required element.

         This ‘does not impose a probability requirement at the pleading stage, ' but instead ‘simply calls for enough facts to raise a reasonable expectation that discovery will reveal evidence of' the necessary element”). A court need not credit either “bald assertions” or “legal conclusions” in a complaint when deciding a motion to dismiss. In re Burlington Coat Factory Sec. Litig., 114 F.3d 1410, 1429-30 (3d Cir. 1997). The defendant bears the burden of showing that no claim has been presented. Hedges v. U.S., 404 F.3d 744, 750 (3d Cir. 2005) (citing Kehr Packages, Inc. v. Fidelcor, Inc., 926 F.2d 1406, 1409 (3d Cir. 1991)).

         A court in reviewing a Rule 12(b)(6) motion must only consider the facts alleged in the pleadings, the documents attached thereto as exhibits, and matters of judicial notice. S. Cross Overseas Agencies, Inc. v. Kwong Shipping Grp. Ltd.,181 F.3d 410, 426 (3d Cir. 1999). A court may consider, however, “an undisputedly authentic document that a defendant attaches as an exhibit to a motion to dismiss if the plaintiff's claims are based on the document.” Pension Benefit Guar. Corp. v. White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d Cir. 1993). If any other matters outside the pleadings are ...

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