On June 6, 2016, the U.S. Supreme Court issued an order declining to review an appeals court decision that authorized individuals and entities to sue for damages under RICO, the federal anti-racketeering statute, even when they lack a direct relationship with the defendant. The decision was a setback for WLF, which filed a brief urging review. WLF argued that a plaintiff cannot demonstrate the requisite “proximate cause,” demanded of all RICO plaintiffs, if his theory of causation is too attenuated; e.g., if any damages are dependent on the actions of intermediaries not under the defendant’s control. The case involves an effort by several third-party health insurance payers (TPPs) to recover payments they made to their customers as reimbursement for the cost of Avandia, an FDA-approved drug prescribed to the customers by their doctors. WLF argued that the TPPs cannot satisfy RICO’s proximate-cause requirement because they lack a direct relationship with the drug manufacturer.
GlaxoSmithKline LLC v. Allied Services Division Welfare Fund