In a significant ruling in the Walgreens Prescription Savings Club class action lawsuit, a judge in the U.S. District Court for the Northern District of Illinois denied a request by various Blue Cross Blue Shield (BCBS) entities to opt out “en masse” from the $100 million settlement. The lawsuit, Russo et al. v. Walgreen Co. (Case No. 1:17-cv-02246), alleges that Walgreens inflated its “usual and customary” prices for prescription drugs by not factoring in lower prices offered through its Prescription Savings Club, resulting in overcharges for insured customers and third-party payors, including BCBS entities, from January 1, 2007, to November 18, 2024.
Key Details of the Ruling:
- BCBS’s Request: BCBS entities, acting as third-party administrators, sought to collectively opt out 31 affiliated entities from the settlement. This “en masse” opt-out was intended to allow these entities to pursue individual claims or avoid being bound by the settlement terms.
- Judge’s Decision: The court rejected the collective opt-out, citing that it would complicate the process for the 31 entities, some of which had expressed a desire to remain in the settlement to recover funds. The judge emphasized that opt-out procedures must be individualized to ensure fairness and clarity for each entity’s intentions.
- Implications: By denying the en masse opt-out, the court ensures that BCBS entities wishing to participate in the settlement can claim their share of the $100 million fund, which is split with 80% allocated to third-party payors (like BCBS) and 20% to individual claimants, after deductions for legal fees and administrative costs. Entities that still wish to opt out must do so individually by the exclusion deadline of March 18, 2025.
Context of the Settlement:
- Allegations: The lawsuit claims Walgreens’ pricing scheme led to inflated costs for insured customers and payors, as the company failed to report discounted Prescription Savings Club prices as the “usual and customary” rates, causing overpayments for prescriptions.
- Settlement Details: Walgreens, while denying wrongdoing, agreed to a $100 million settlement, preliminarily approved on November 18, 2024. Claimants must submit forms by April 17, 2025 (or June 16, 2025, for those who requested purchase history from Walgreens by April 12, 2025). A final approval hearing is set for September 10, 2025.
- Eligibility: The settlement covers individuals and entities in the U.S. who paid for prescriptions at Walgreens using insurance between January 1, 2007, and November 18, 2024. Third-party payors like BCBS are eligible for the larger share of the fund.
Why It Matters:
The denial of the en masse opt-out prevents BCBS from collectively withdrawing its affiliates, ensuring that eligible entities can access their proportional share of the settlement unless they individually opt out. This ruling reinforces the court’s commitment to protecting claimants’ rights to participate in the settlement while maintaining procedural fairness. It also highlights the complexity of managing large-scale class actions involving third-party payors with varying interests.
For those affected, including BCBS entities, claims can be filed at SavingsClubSettlement.com, and further details are available through the settlement administrator at 1-877-888-8386.