Rite Aid 2015 Annual Report Download - page 25

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this time, are not able to predict either the outcome of these lawsuits or estimate a potential range of
loss with respect to said lawsuits.
We were served with a Civil Investigative Demand Subpoena Duces Tecum dated August 26, 2011
by the United States Attorney’s Office for the Eastern District of Michigan. The subpoena requests
records regarding Rite Aid’s Rx Savings Program and the reporting of usual and customary charges to
publicly funded health programs. In connection with the same investigation, we were served with a Civil
Subpoena Duces Tecum dated February 22, 2013 by the State of Indiana Office of the Attorney
General. We have substantially completed our response to both of the subpoenas and are unable to
predict the timing or outcome of any review by the government of such information.
In April 2012, we received an administrative subpoena from the Drug Enforcement Administration
(‘‘DEA’’), Albany, New York District Office, requesting information regarding our sale of products
containing pseudoephedrine (‘‘PSE’’). In April 2012, we also received a communication from the
United States Attorneys Office (‘‘USAO’’) for the Northern District of New York concerning an
investigation of possible civil violations of the Combat Methamphetamine Epidemic Act of 2005
(‘‘CMEA’’). In April 2013, we received additional administrative subpoenas from DEA concerning
certain retail PSE transactions at New York stores and the USAO commenced discussions with us
regarding whether, from 2009 (upon implementation of an electronic PSE transaction logbook system)
through the present, we sold products containing PSE in violation of the CMEA. We received
additional administrative subpoenas from the DEA beginning in December 2013 requesting information
in connection with an investigation of violations of the CMEA in West Virginia. Violations of the
CMEA could result in the imposition of administrative, civil and/or criminal penalties against us. We
are cooperating with the government and continue to provide information responsive to the subpoenas.
We have entered into a tolling agreement with the USAO. Discussions are underway to resolve these
matters, but whether an agreement can be reached and on what terms are uncertain. While our
management cannot predict the outcome of these matters, it is possible that our results of operations
or cash flows could be materially affected by an unfavorable resolution.
In January 2013, the DEA, Los Angeles District Office, served an administrative subpoena on us
seeking documents related to prescriptions by a certain prescriber. The USAO, Central District of
California, also contacted us about a related investigation into allegations that Rite Aid pharmacies
filled certain controlled substance prescriptions for a number of practitioners after their DEA
registrations had expired or otherwise become invalid in violation of the federal Controlled Substances
Act and DEA regulations. We responded to the administrative subpoena and subsequent informal
requests for information from the USAO. We met with the USAO and DEA in January 2014 and are
involved in ongoing discussions with the government regarding this matter. We recorded a legal accrual
during the period ended March 1, 2014.
We were served with a Civil Investigative Demand (‘‘CID’’) dated June 21, 2013 by the USAO for
the Eastern District of California and the Attorney General’s Office of the State of California (the
‘‘AG’’). The CID requests records and responses to interrogatories regarding Rite Aid’s Drug
Utilization Review and prescription dispensing protocol and the dispensing of drugs designated
‘‘Code 1’’ by the State of California. We are in the process of producing responsive documents and
interrogatory responses to the USAO and AG and are unable to predict the timing or outcome of any
review by the government of such information.
In addition to the above described matters, we are subject from time to time to various claims and
lawsuits and governmental investigations arising in the ordinary course of business. While our
management cannot predict the outcome of any of the claims, our management does not believe that
the outcome of any of these legal matters will be material to our consolidated financial position. It is
possible, however, that our results of operations or cash flows could be materially affected by an
unfavorable resolution of pending litigation or contingencies.
Item 4. Mine Safety Disclosures
Not applicable
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