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McKESSON CORPORATION
FINANCIAL NOTES (Continued)
94
The Utah Action
On October 20, 2010, an action was filed in the United States District Court for the Northern District of
California by the State of Utah against the Company as the sole defendant asserting claims under RICO and for civil
conspiracy, tortious interference with contract, and unjust enrichment, and seeking damages, treble damages,
restitution, as well as injunctive relief, interest, attorneys’ fees and costs of suit, all in unspecified amounts, State of
Utah v. McKesson Corporation, et al., (No. CV 10-4743-SC). On July 19, 2011, the court denied the Company’s
motion to dismiss the State’s complaint. Discovery is ongoing, and trial is set for March 11, 2013.
The Arizona Administrative Proceeding
On November 5, 2010, the Company received a Notice of Proposed Civil Monetary Penalty from the Office of
Inspector General for the Arizona Health Care Cost Containment System (“AHCCCS”) purporting to initiate an
administrative claim process against the Company, and seeking civil penalties in the amount of $101 million and an
assessment in the amount of $112 million for false claims allegedly submitted to the Arizona Medicaid program
(No. 2010-1218). On February 28, 2011, the Company filed a complaint in Arizona Superior Court, County of
Maricopa, against AHCCCS and its Director, alleging that the administrative proceeding commenced by AHCCCS
violates the Arizona Administrative Procedure Act and the Due Process Clauses of the Arizona Constitution and the
United States Constitution, and seeking to enjoin AHCCCS’s administrative proceeding, a declaratory judgment that
AHCCCS lacks jurisdiction and legal authority to impose penalties or assessments against the Company, as well as
costs of suit, McKesson Corporation v. AHCCCS, (No. CV-2011-004446). On April 28, 2011, the court ruled that
AHCCCS has no jurisdiction to impose penalties or assessments against the Company and enjoined AHCCCS from
prosecuting or reinitiating any penalty proceeding against the Company. On May 31, 2011, the court entered final
judgment in favor of the Company. On June 16, 2011, AHCCCS filed a notice of appeal. The briefing on
AHCCCS’s appeal is complete, but a hearing date has not yet been set.
The Hawaii Action
On November 10, 2010, an action was filed in Hawaii state court by the State of Hawaii against the Company
and FDB asserting claims under Hawaii’s false claims statute, Hawaii’s unfair and deceptive trade practices statute,
and for fraud and civil conspiracy, and seeking damages, treble damages, punitive damages, civil penalties,
disgorgement of profits, as well as interest, attorneys’ fees and costs of suit, all in unspecified amounts, State of
Hawaii v. McKesson Corporation, et al., (CV. No. 10-1-2411-11-GWBC). On April 12, 2011, the court denied the
Company’s motion to dismiss the State’s complaint. Discovery is ongoing, and trial is set for April 15, 2013.
The Louisiana Action
On December 20, 2010, an action was filed in Louisiana state court by the State of Louisiana against the
Company as the sole defendant asserting claims under Louisiana’s unfair and deceptive trade practices statute,
Louisiana’s Medical Assistance Programs Integrity Law, Louisiana’s antitrust statute, and for fraud, negligent
misrepresentation, civil conspiracy, and unjust enrichment, and seeking damages, statutory fines, civil penalties,
disgorgement of profits, as well as interest, attorneys’ fees and costs of suit, all in unspecified amounts, State of
Louisiana v. McKesson Corporation, (No. C597634 Sec. 23). On June 2, 2011, the court granted the State’s motion
to consolidate for all purposes, including trial, the State’s suit against the Company with the State’s pending action
against numerous drug manufacturers, State of Louisiana v. Abbott Laboratories, Inc., et al., (No. C596164). On
September 8, 2011, the trial court entered an order granting the State’s motion to voluntarily dismiss its antitrust
claims. The Louisiana Court of Appeals, on September 20, 2011, denied the Company’s appeal challenging the trial
court’s June 2, 2011 consolidation order. On December 14, 2011, the trial court denied the Company’s motion to
dismiss the State’s complaint. On December 19, 2011, the Company filed an application for a supervisory writ, with
the Louisiana Court of Appeals, seeking to challenge the trial court’s ruling that the State is the proper party to assert
damages claims on behalf of Louisiana’s Medicaid program, which application was denied. No trial date has been
set.