ELECTRONICALLY FILED
Arkansas Supreme Court
Stacey Pectol, Clerk of the Courts

IN THE SUPREME COURT OF ARKANSAS
STATE OF ARKANSAS;
ARKANSAS DEPARTMENT OF CORRECTION;
ASA HUTCHINSON, in his official capacity as
Governor of Arkansas; and
WENDY KELLEY, in her official capacity as
Director of the Arkansas Department of Correction,
v.

2017-Apr-20 12:57:25
CV-17-317
23 Pages

PETITIONERS

No. CV 17-317

HON. ALICE GRAY and
MCKESSON MEDICAL-SURGICAL, INC.

RESPONDENTS

MCKESSON MEDICAL-SURGICAL, INC.’S
RESPONSE TO EMERGENCY PETITION FOR IMMEDIATE WRIT OF
MANDAMUS, WRIT OF CERTIORARI,
OR SUPERINTENDING WRIT
McKesson Medical-Surgical, Inc. (“McKesson”) states as follows for its
response to Petitioners’ Emergency Petition for Immediate Writ of Mandamus, Writ
of Certiorari, and Superintending Writ.
An order has been entered by the Circuit Court of Pulaski County, Arkansas.
See Exhibit 1, Order. Petitioners request for extraordinary relief is moot. Appeal is
now available to petitioners, and petitioners have filed a notice of appeal and moved
for a stay. This procedure should allow this Court to consider the entire record, not
just the incomplete copy of McKesson’s verified complaint and its motion for
temporary restraining order or preliminary injunction – without the supporting brief
– attached to petitioner’s petition. This Court “will not grant writs of certiorari in
situations where the result would effectively enforce piecemeal appellate
DC: 6403499-1

 review.” Jordan v. Circuit Court of Lee Cty., 366 Ark. 326, 332, 235 S.W.3d 487,
492 (2006).
McKesson below addresses the arguments by petitioners against the circuit
court’s order.
EVIDENCE SUPPORTING THE PRELIMINARY INJUNCTION
The record in the circuit court contains evidence of the following facts.
McKesson is a distributor of life-saving and life-enhancing products to healthcare
providers and their patients. One of McKesson’s products is vecuronium bromide
(“Vecuronium”), which is listed on the World Health Organization’s List of
Essential Medicines, the most safe and effective medicines used in any health
system.
Vecuronium is also used by some state correctional facilities as a part of their
capital-punishment regimen.

The manufacturer of Vecuronium, however, has

included clauses in its sale agreements that prohibit distributors – including
McKesson – from selling to federal and state correctional facilities that engage in
capital punishment specific drugs that are capable of being used in the administration
of capital punishment.
The Arkansas Department of Correction (“ADC”), due to the position of drug
manufacturers prohibiting the use of their products in the administration of capital
punishment, faced difficulty obtaining the drugs it sought to use in the administration

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 of capital punishment. ADC Director Wendy Kelley expressed to her subordinate
Rory Griffin that she did not know where she would get the drugs. Mr. Griffin
volunteered that he may have a supplier.
After his conversation with Ms. Kelley, Mr. Griffin contacted McKesson
employee Tim Jenkins, whom he had contacted to purchase medical supplies and
prescription drugs for legitimate medical purposes in the past, and asked to purchase
Vecuronium. In order to purchase prescription drugs in the past from McKesson,
ADC had provided to McKesson proof of a medical license issued to a purchasing
physician. Over the course of the parties’ relationship, ADC continuously relied
upon that medical license to purchase medical products from McKesson. ADC
largely purchased medical surgical supplies and other commonly used medical
products. ADC also purchased prescription pharmaceuticals. All of the foregoing
products are standard items found in a well-supplied medical facility.
Mr. Griffin never disclosed during its dealings with McKesson ADC’s
intention to use the Vecuronium in the administration of capital punishment. Ms.
Kelley, herself, when attempting to obtain drugs for use in the administration of
capital punishment, always disclosed the intended use of the drugs. But, having
faced difficulty obtaining drugs for that purpose, Ms. Kelley did not instruct Mr.
Griffin to disclose to his supplier that the Vecuronium ADC sought would be used

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 in the administration of capital punishment. She admitted that a failure to disclose
by Mr. Griffin would be improper.
Ms. Kelley specifically instructed Mr. Griffin not to leave a paper trail of the
Vecuronium transaction. Accordingly, Mr. Griffin communicated with McKesson
about the Vecuronium by text and phone, and declined to communicate by email.
Mr. Griffin did not retain the texts.

He also later attempted to pick up the

Vecuronium at McKesson’s distribution facility in Little Rock, rather than having it
shipped to ADC, as was standard. Mr. Griffin sought, as Ms. Kelley directed, not to
create a paper trail.
ADC undertook its plan to obtain Vecuronium with full knowledge on the part
of ADC that the manufacturer does not permit sales of Vecuronium to state
correctional facilities that administer capital punishment. Nevertheless, Mr. Griffin
suggested to Mr. Jenkins in a text message that McKesson source the Vecuronium
from that very manufacturer. This evidence supports Mr. Jenkins’s unequivocal
testimony that Mr. Griffin did not disclose the purpose for which ADC actually
sought the drug.

Had ADC disclosed to McKesson the intended use of the

Vecuronium, ADC could not have obtained it from McKesson. McKesson would
not have permitted the order. McKesson was led to believe that the intended use of
the Vecuronium was, like ADC’s other purchases from McKesson, made in reliance
on the medical license that ADC earlier had provided to McKesson to keep on file

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 for its prescription purchases, and was for use in a legitimate medical application,
which does not include the administration of capital punishment. The order was
placed on or about July 11, 2016.
Mr. Griffin knew that McKesson was not authorized to sell Vecuronium to
ADC for the purpose for which Mr. Griffin knew it was to be used Further, while
ADC attempted to avoid a paper trail and destroyed the text messages that existed,
McKesson—not knowing the purpose of the transaction—shipped the Vecuronium
using its normal procedure to ADC and maintained the records normally associated
with the sale of drugs.
After McKesson received an inquiry on July 20, 2016, from the manufacturer
about this sale, McKesson spoke to Mr. Griffin immediately thereafter on July 21,
2016, and requested a return of the Vecuronium. Mr. Griffin indicated to McKesson
that the Vecuronium had been set aside for return. McKesson promised to refund
ADC’s payment.
On or about July 21, 2016, McKesson received from ADC a signed
declaration titled “Prescription Drug/Cold Chain Production Return Declaration.”
An ADC representative appeared to have signed the declaration “[u]nder penalties
of perjury,” “declare[d] that [she] read the forgoing and that the facts stated herein
are true,” and affirmed that “in accordance with the state and federal law
requirements and the manufacturer’s requirements” she was “shipping the

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 prescription Drug(s) and/or CCP back to McKesson.” McKesson immediately
began processing ADC’s refund, issuing a credit for the product on July 27, 2016,
even though the product had not yet been returned by ADC. McKesson also
provided shipping labels to ADC to facilitate the product’s return. See Exhibit 5.
However, Ms. Kelley refused to permit the return by ADC of the Vecuronium
to McKesson. Despite repeated attempts by McKesson to secure the return of the
Vecuronium, ADC has never returned the Vecuronium.

To this day, the

Vecuronium remains in ADC’s possession, as do the funds McKesson credited to
ADC on ADC’s promise to return the Vecuronium.
ADC intends to use the Vecuronium in executions in the coming days. As a
result of the intense public debate about these executions, McKesson was publicly
identified – before any litigation instituted by McKesson – as the distributor
responsible for providing Vecuronium to ADC. McKesson has significant concerns
about the business harms that it would suffer from the use in executions of a drug
that it had supplied. The State has admitted that, by associating a distributor with
ADC and the administration of capital punishment, “you are also possibly affecting
their ability to carry out their business at all if they are unable to procure drugs from
the FDA-approved manufacturers that these drugs came from.”

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 ARGUMENT
Whether to grant a preliminary injunction pursuant to Rule 65 of the Arkansas
Rules of Civil Procedure is committed to the sound discretion of the circuit court.
See Smith v. American Trucking Ass’n, Inc., 300 Ark. 594, 597, 781 S.W.2d 3, 5
(1989); Custom Microsystems, Inc. v. Blake, 344 Ark. 536, 540, 42 S.W.3d 453, 456
(2001) (“The decision to grant or deny an injunction is within the discretion of the
chancery judge.”). The circuit court must consider two factors: (1) whether the
moving party has demonstrated a likelihood of success on the merits and (2) whether
irreparable harm will result in the absence of an injunction or restraining order. See
Baptist Health v. Murphy, 365 Ark. 115, 121, 226 S.W.3d 800, 806 (2006). The
circuit court considered these two factors, addressed both of them, and carefully
exercised its considerable discretion. Although petitioners present a litany of
arguments, none has merit. The circuit court acted within its broad discretion, and
this Court should deny the petition.
1. The Circuit Court Had Jurisdiction To Enter The Order.
Petitioners contend that the circuit court lacks jurisdiction because the circuit
court cannot stay executions. The order at issue, however, is not a stay of execution.
McKesson did not seek such an order, and the circuit court did not enter an order
staying an execution.

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 McKesson filed suit to prevent the drugs that it supplied, and that ADC
obtained through misrepresentation and mistake, from being used by ADC. As a
result, the circuit court’s order precludes ADC only from using McKesson’s specific
product. The order does not enjoin ADC from using other drugs or means to conduct
executions. Neither McKesson nor the relief it seeks is an obstacle to such action
by ADC.

See, e.g., Ark. Code Ann. § 5-4-617(c)(1) (authorizing the use of

barbiturates for execution by lethal injection). That ADC may not have other drugs
available for its intended purposes at this particular time, or have other means to
effect executions on the schedule that has been set, does not somehow transform an
order not to dispose of a particular product into a stay of executions.
The State relies on Kelley v. Griffen in support of its contention that the circuit
court lacked authority to grant relief to McKesson. 2015 Ark. 375, 3, 472 S.W.3d
135, 137 (2015). But in Kelley, the circuit court expressly “stated in the order that
it was staying the executions.” Id. No such order has been requested or entered in
this case. Similarly, Ark. Code Ann. § 16-90-506(c), which petitioners also cite,
does not apply. McKesson did not ask the circuit court to “suspend[] the execution
of a judgment of death.” Id. McKesson asked for an order against the State’s use of
McKesson’s property.

Executions may proceed, just not with McKesson’s

Vecuronium. The circuit court had jurisdiction to enjoin preliminarily ADC’s use
of the Vecuronium that it had obtained from McKesson.

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 The Formal Order issued on April 17, 2017, by this Court in Case No. CV17-299 does not indicate that the circuit court lacked jurisdiction. In that earlier
case, the State’s request for writs of mandamus and prohibition were denied.
Prohibition will lie when the circuit court is wholly without jurisdiction, but this
Court did not issue a writ of prohibition in the earlier case. White v. Palo, 2011 Ark.
126, 7, 380 S.W.3d 405, 409 (2011). This Court issued a writ of certiorari. The
irregularity addressed by this Court in granting certiorari appears to have been
directed to Judge Wendell Griffin’s presiding over Case No. 60cv-17-1921. See Per
Curiam, Case No. 17-155 (April 17, 2017). It does not appear to have been directed
at a jurisdictional problem, and, as explained above, there was none. The circuit
court had jurisdiction.
2. Sovereign Immunity Does Not Bar McKesson’s Claims.
Petitioners also contend that they have sovereign immunity from suit. But
McKesson is not seeking money damages – only relief that is purely injunctive.
Indeed, McKesson’s complaint is express that no money damages have been
requested. And this Court has recognized exceptions to sovereign immunity that
apply here. This Court has made clear that ultra vires, arbitrary, capricious, and badfaith acts are not protected by sovereign immunity. See Arkansas Lottery Comm’n
v. Alpha Mktg., 2013 Ark. 232, 7, 428 S.W.3d 415, 420 (2013); Arkansas Dep't of
Envtl. Quality v. Oil Producers of Arkansas, 2009 Ark. 297, 11, 318 S.W.3d 570,

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 575–76 (2009) (holding that, when the State acted pursuant to unauthorized rules
and regulations, its conduct was ultra vires and sovereign immunity was waived).
As detailed above, and in the briefing and record below, the State engaged in a course
of bad-faith dealings with McKesson and must answer for them in the courts. When
an exception to sovereign immunity applies, injunctive relief is the only remedy
available. Alpha Mktg., 2013 Ark. 232, 7, 428 S.W.3d at 420 (“[T]he exception for
ultra vires, arbitrary, capricious or bad-faith acts extends only to injunctive relief.”).
Injunctive relief is all that McKesson is seeking.
Moreover, purely ministerial acts can be compelled without violating
sovereign immunity. Comm’n on Judicial Discipline & Disability v. Digby, 303
Ark. 24, 26, 792 S.W.2d 594, 595 (1990). The relief that McKesson seeks is
ministerial – completion of a product-return process to which ADC had agreed. ADC
promised to return the product – and then reneged on that promise – after obtaining
it under false pretenses and duping the distributor. Now, all that is required to
complete the process is the State’s return of the Vecuronium to McKesson.
This Court’s decision in Cammack v. Chalmers, 284 Ark. 161, 166, 680
S.W.2d 689, 691 (1984), is instructive. There, a donor had provided property to the
Board of Trustees for the University of Arkansas for a “specific” and “clearly
limited” purpose. Id. Because the Board of Trustees attempted to use the property
in a manner inconsistent with the terms of the conveyance, the trial court had

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 jurisdiction to enjoin the actions of the university trustees that were in bad faith or
arbitrary. Id. Also, in Newton v. Etoch, 332 Ark. 325, 965 S.W.2d 96 (1998), an
attorney alleged that state employees engaged in conduct that they knew would
“embarrass[] him and damag[e] his professional reputation.” Because the conduct
of the state employees was “malicious,” the plaintiff overcame sovereign immunity.
McKesson demonstrated during the hearing before the circuit court that the
ADC’s conduct in acquiring and retaining the Vecuronium was in bad faith and ultra
vires.

The admissions of the State’s representatives demonstrate: the State’s

awareness that McKesson was prohibited from selling Vecuronium to the State for
use in capital punishment; that ADC should have disclosed to McKesson the reason
it was attempting to purchase Vecuronium; the State’s understanding that ADC’s
conduct would cause serious harm to McKesson; and a strategic decision by the State
to misrepresent or induce a mistake about the purpose of its purchase of the
Vecuronium. Accordingly, the circuit court properly concluded that McKesson has
a reasonable likelihood of success on the State’s sovereign-immunity defense.
The State’s suggestion that there is no private cause of action to enforce the
various state laws regarding the state medical board, medical licenses, or drug
wholesalers does not alter this sovereign-immunity analysis. The State’s defense of
sovereign immunity is defeated by the exception for ultra vires, arbitrary, capricious,
and bad-faith conduct on the part of the State, regardless of whether some other,

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 separate private action could be brought. Arkansas Game & Fish Comm'n v.
Lindsey, 292 Ark. 314, 320, 730 S.W.2d 474, 478 (1987) (holding that obstruction
of a road was an illegal act and not protected by sovereign immunity)Here, in this
action for return of the Vecuronium and for an order against the State’s use of the
same, the State’s actions were misleading and in bad-faith and thus are not shielded
by sovereign immunity.
3. McKesson Demonstrated A Reasonable Probability Of Success On The Merits.
Petitioners’ contention that there is not a likelihood of the complaint’s
succeeding is based on mischaracterization of the issues. Petitioners’ argument that
there is not a private cause of action to enforce the various state laws regarding the
state medical board, medical licenses, or drug wholesalers misreads the complaint.
The complaint does not seek to enforce those laws, but points to the State’s bad-faith
and misrepresentations, which include actions contrary to those state laws, as one of
the reasons that the State’s actions are not shielded here by sovereign immunity.
And petitioners’ argument that the courts must presume that a State agency follows
all statutes and regulations is an argument that cannot support dismissal of a
complaint that pleads to the contrary and whose allegations are supported by proof
adduced at an evidentiary hearing. It is not even an argument that the State did not
engage in bad faith, ultra vires actions. Surely it is not within the parameters of
good-faith, authorized conduct to obtain a product from a supplier knowing that the

12

 supplier is barred from distributing the product for the use intended by the State
while effecting a mistake on the part of the supplier about the intended use of the
product.
Petitioners’ argument that it has authority to use Vecuronium in its
administration of capital punishment is not the point. The complaint seeks only the
return of the Vecuronium that ADC misled McKesson into selling to the State and a
prohibition against the State’s use of the same; it does not seek any relief regarding
use of any drugs obtained by the State elsewhere.
McKesson has stated claims for rescission based on misrepresentation and
mistake, replevin, and unjust enrichment, and the circuit court correctly found a
reasonable probability of success on those claims. Custom Microsystems, Inc. v.
Blake, 344 Ark. 536, 542, 42 S.W.3d 453, 457–58 (2001) (“a reasonable probability
of success is a benchmark for issuing a preliminary injunction.”).
(1)

“Rescission involves an effort to abandon and recede from a contract

which the parties did not intend to make.” Aetna Life Ins. Co. v. May, 217 Ark. 215,
221, 229 S.W.2d 238, 241 (1950). As set forth above, McKesson has a likelihood
of demonstrating that Vecuronium was obtained by ADC through misrepresentation
and mistake. ADC has admitted that it knew that McKesson would not sell
Vecuronium to ADC for the purpose of executions, so ADC intentionally deviated
from normal procedures by communicating only by text message, tried to avoid

13

 shipment to a correctional facility, and leveraged its existing relationship with
McKesson’s sales representative and previous history of prescription drug purchases
under the auspices of a medical license on file, and intentionally led McKesson to
misunderstand ADC’s intended use of the drug.
Under the State of Arkansas’s regulations for physicians, a licensed physician
“may not . . . [p]rescribe or administer dangerous or controlled drugs to a person for
other than legitimate medical purposes.”

Arkansas State Medical Board

Regulations, § 17-95-704. In order to place its purchase of Vecuronium, ADC relied
upon the existing medical license issued to a doctor that was on file with McKesson
and that had been repeatedly used to purchase medical supplies and to purchase
injectable drugs for legitimate medical purposes. By intentionally failing to disclose
the intended use of the Vecuronium, ADC led McKesson to believe that the
Vecuronium would be used only for “legitimate medical purposes”; otherwise, a
physician would not be able to prescribe or administer the Vecuronium. The
administration of capital punishment is not a legitimate medical purpose, as defined
in Arkansas law. See Ark. Code Ann. § 17-95-704(e)(3), (4)(A).
When a party seeks rescission based on mistake, there is no contract “between
the parties on account of the fact that there had not been a meeting of the minds of
the contracting parties.” Aetna Life Ins. Co. v. May, 217 Ark. 215, 221, 229 S.W.2d
238, 241 (1950).

Under an existing agreement, Vecuronium is one of the drugs

14

 McKesson is not permitted to sell to state correctional facilities that administer
capital punishment. McKesson would not have entered an agreement to sell to ADC
Vecuronium had McKesson known that it would not be used for a legitimate medical
purpose, pursuant to the regulations of the Arkansas Medical Board that govern
physicians in the State of Arkansas. ADC knew that McKesson had made a mistake,
induced by ADC’s conduct, and sought to capitalize on it. McKesson has a
likelihood of proving there was no meeting of the minds and succeeding on its
rescission claim.
(2)

Arkansas law “authorizes a party claiming a right of possession of

property in the possession of another to apply . . . for issuance of an order of delivery
of the property.” Drug Task Force for Thirteenth Judicial Dist. of State v. Hoffman,
353 Ark. 182, 186-87, 114 S.W.3d 213, 215 (2003); see also Ark. Code § 18–60–
804. McKesson’s replevin claim constitutes exactly that. On or about July 11, 2016,
McKesson shipped to ADC 10 boxes containing 10 vials of 20 mg/25 ml
Vecuronium. McKesson received a declaration signed “[u]nder penalties of perjury”
in which the signatory “declare[d] that [she] read the forgoing and that the facts
stated herein are true” and affirmed that “in accordance with the state and federal
law requirements and the manufacturer’s requirements” ADC was “shipping the
prescription Drug(s) and/or CCP back to McKesson.” ADC acknowledged that the

15

 Vecuronium had been obtained inappropriately and had to be returned. On these
facts, McKesson has a likelihood of success on the merits on its claim for replevin.
(3)

“To find unjust enrichment, a party must have received something of

value, to which he or she is not entitled and which he or she must restore.” Campbell
v. Asbury Auto., Inc., 2011 Ark. 157, 21, 381 S.W.3d 21, 36 (2011). Unjust
enrichment requires there to “be some operative act, intent, or situation to make the
enrichment unjust and compensable.” Id. ADC has admitted it knew it was not
allowed to obtain Vecuronium from McKesson. It has admitted that it obtained
Vecuronium from McKesson anyway. It has admitted that it knew that McKesson
was making a mistake. It agreed to return the product but has admittedly refused to
follow through. No private party could argue with any credibility that these facts
would not establish a claim for unjust enrichment. It should be no different for ADC.
McKesson has a substantial likelihood of succeeding on the merits of its unjustenrichment claim.
4. McKesson Has Shown Irreparable Harm.
The harm McKesson will suffer in the absence of a preliminary injunction is
irreparable and money damages will not suffice. Potter v. City of Tontitown, 371
Ark. 200, 214, 264 S.W.3d 473, 483 (2007) (“Harm is normally only considered
irreparable when it cannot be adequately compensated by money damages or
redressed in a court of law.”). Without a preliminary injunction, McKesson’s

16

 property will be used by ADC and cannot be returned to McKesson. McKesson will
suffer grave irreparable harm for being associated with the executions of inmates
using products that the manufacturer banned for such purpose. The association will
impact McKesson’s relationships with its contractual partners. Manufacturers that
prohibit the sale of lethal pharmaceuticals to federal and state correctional facilities
that administer capital punishment will likely be less likely to enter into business
arrangements with McKesson if products McKesson distributed are used in the
administration of capital punishment. Arkansas has admitted that, by associating a
distributor with ADC and the administration of capital punishment, “you are also
possibly affecting their ability to carry out their business at all if they are unable to
procure drugs from the FDA-approved manufacturers that these drugs came from.”
McKesson has a significant commercial interest in ensuring that its contracts
are implemented correctly and avoiding damage to its reputation and good will. Such
harms cannot be adequately remedied later through a monetary judgment against
ADC and Arkansas. See Walker v. Selig, 2015 WL 12683818, at *19 (E.D. Ark.
Oct. 30, 2015) (finding “loss of intangible assets such as reputation and goodwill
can constitute irreparable injury” and that “a threat of irreparable harm may exist
when relief through money damages in an action at law will not fully compensate a
claimant's economic loss”); Tempur-Pedic Int’l, Inc. v. Waste To Charity, Inc., 2007
WL 535041, at *10 (W.D. Ark. Feb. 16, 2007) (“Although the damage to Tempur-

17

 Pedic’s reputation and good will is intangible, such injuries may constitute
irreparable harm.”). Because the executions are scheduled to proceed immediately,
with the concomitant use of products that ADC obtained from McKesson through
material misrepresentations and mistake in violation of its supplier agreement, the
threatened harms cannot be remedied later.
Petitioners’ attempt to discount the harm to McKesson suggests that
McKesson’s own filing of a lawsuit disclosed the company’s identity and thus
undermines its claim for irreparable injury that would result if ADC is not enjoined
from using the Vecuronium it obtained from McKesson.

But, as petitioners

recognize, McKesson attempted repeatedly, through private correspondence, to
obtain the return of the Vecuronium from ADC. Indeed, McKesson obtained
agreement from ADC for it to return the drugs, but ADC did not follow through on
that agreement. The record in this action reflects that the manufacturer of the
Vecuronium initially identified McKesson as the supplier on April 13, 2017. See
Exhibit 2. National publications, including Bloomberg and the Washington Post,
then reported on McKesson’s involvement. See Exhibit 6. It was not until that point
that McKesson filed its initial lawsuit on April 14, 2017.
The initial public identification of McKesson as the supplier was through
public statements by other entities, but that disclosure meant that McKesson’s ability
to protect against irreparable harm required further action. These circumstances

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 certainly do not preclude McKesson from its right to obtain return of the
Vecuronium that ADC misled it into selling.
5. Venue Is Proper In Pulaski County.
McKesson filed this action on April 18, 2017, seeking a temporary restraining
order against ADC’s use of the Vecuronium it had obtained from McKesson. The
circuit court held a telephonic conference with the parties on April 18, 2017, during
which counsel for the State agreed to participate in a hearing on April 19, 2017.
Later that same day and after agreeing to participate in a hearing, the State filed a
Motion for Change of Venue, asking the circuit court to transfer this action to the
Circuit Court of Faulkner County. This matter, with notice to all parties and without
objection, was set for hearing regarding McKesson’s motion for a temporary
restraining order or preliminary injunction on April 19, 2017. The State waived any
right to insist that this case be transferred without a decision on McKesson’s motion
for a temporary restraining order or preliminary injunction.
And there is no justification for a writ vacating the preliminary injunction and
ordering transfer now. Petitioners contend that the circuit court was required to
transfer this case to Faulkner County under a just-enacted law that appears designed
specifically to permit the State to take cases out of Pulaski County and engage in
forum-shopping for a State-preferred judge. Courts have a long and distinguished
history of disapproval of judge-shopping. Patterson v. Isom, 338 Ark. 234, 240–41,

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 992 S.W.2d 792, 796 (1999). There is no dispute that McKesson properly brought
this case in Pulaski County and that Pulaski County is a proper venue for this case.
This Court should not permit the use of an extraordinary writ to compel transfer of
a case from a proper venue on the whim of the State.
Moreover, McKesson has serious legal arguments against the transfer of this
case that the circuit court indicated will be addressed following appropriate briefing
and a hearing under the Arkansas Rules of Civil Procedure. The recently passed law
upon which the State relies ostensibly permits transfer only when the plaintiff is not
a “resident” of Arkansas. The law does not define the word resident. The State
wishes to define the word resident as synonymous with citizen for purposes of
assessing diversity of citizenship for removal to federal court, which is to say the
State argues that residency means where a corporation is incorporated and where a
corporation has its principal place of business. But the law does not say “citizen”;
the law says “resident.” And the State presented no authority that the word resident
in this new law means the same thing as citizen means in the context of federal
diversity jurisdiction. There is no reason to believe that is what the General
Assembly intended. Indeed, such an interpretation is contrary to the venue scheme
in the Arkansas Code. See Ark. Code Ann. § 16-60-101(a)(3)(B) (defining corporate
residence for venue purposes as “the county where the plaintiff had its principal

20

 office in this state at the time of the event or omission giving rise to the cause of
action.”).
McKesson presented an affidavit that it has a facility in Pulaski County and
employees in Pulaski County and that it pays taxes here. That is enough to establish
residency for purposes of this change-of-venue law. It is at least enough to warrant
full adversarial briefing and argument on this issue in the circuit court and an order
from the circuit court on the issue of change of venue, before this Court hands down
a precedent about the meaning of a recently enacted law. An extraordinary writ is
not appropriate as a means to displace a case from a proper venue to a new one in
these circumstances.
CONCLUSION
The State should not be excused from using false pretense, trickery, and bad
faith to dupe a taxpaying employer of Arkansas citizens into selling a product the
State knew the company would not sell if the seller was not misled and mistaken
about the true facts behind the transaction. No extraordinary writ from this Court
should indicate otherwise. The circuit court was well within its discretion to issue a
preliminary injunction, and the petition for a writ should be denied.

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 Respectfully submitted,
QUATTLEBAUM, GROOMS & TULL PLLC
111 Center Street, Suite 1900
Little Rock, Arkansas 72201
(501) 379-1700 (telephone)
(501) 379-1701 (facsimile)
quattlebaum@qgtlaw.com
mshannon@qgtlaw.com
mheister@qgtlaw.com

By:___/s/ Steven W. Quattlebaum__________
Steven W. Quattlebaum (84127)
John E. Tull III (84150)
Michael N. Shannon (92186)
Michael B. Heister (2002091)
COVINGTON & BURLING LLP
One CityCenter
850 Tenth Street, NW
Washington, DC 20001-4956
Tel: (202) 662-5463
eposner@cov.com
cdenig@cov.com
brazi@cov.com
jdougherty@cov.com
jcloar@cov.com
Ethan Posner
Christopher Denig
Benjamin J. Razi
Jon-Michael Dougherty
Jonathan L. Cloar (2013102)

Attorneys for McKesson Medical-Surgical, Inc.

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 CERTIFICATE OF SERVICE
I do hereby certify that on this 20th day of April, 2017, I filed the foregoing
document with the Clerk of the Supreme Court, and I served a copy on the following
via electronic mail:
Lee P. Rudofsky (lee.rudofsky@arkansas.gov)
Nicholas Bronni (nicholas.bronni@arkansas.gov)
Colin Jorgensen (colin.jorgensen@arkansas.gov)
323 Center Street, Suite 200
Little Rock, Arkansas 72201

___/s/ Steven W. Quattlebaum___________
Steven W. Quattlebaum

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