In Re Massachusetts Diet Drug Litigation

338 F. Supp. 2d 198, 2004 U.S. Dist. LEXIS 19346, 2004 WL 2181572
CourtDistrict Court, D. Massachusetts
DecidedSeptember 17, 2004
DocketCIV.A.04-10911-GAO
StatusPublished
Cited by17 cases

This text of 338 F. Supp. 2d 198 (In Re Massachusetts Diet Drug Litigation) is published on Counsel Stack Legal Research, covering District Court, D. Massachusetts primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Massachusetts Diet Drug Litigation, 338 F. Supp. 2d 198, 2004 U.S. Dist. LEXIS 19346, 2004 WL 2181572 (D. Mass. 2004).

Opinion

MEMORANDUM AND ORDER

O’TOOLE, District Judge.

I. Introduction

These cases stem from the 1997 removal from the market of the diet drugs fenflura-mine (marketed as Pondimin) and dexfen-fluramine (marketed as Redux) based on information suggesting a connection between use of the drugs and the development of valvular heart disease (“VHD”). After the diet drugs were removed from the market, thousands of former users brought numerous product liability lawsuits, including approximately one hundred *200 class actions, against American Home Products Corp. In 1997, the Judicial Panel on Multidistrict Litigation established an MDL proceeding in the Eastern District of Pennsylvania and transferred the pending federal diet drug cases. Thousands of additional diet drug cases have since been transferred to the MDL Court as tag-along cases.

In 1999, American Home Products reached a nationwide class action settlement agreement with the plaintiffs, which the MDL Court approved in August 2000. Brown v. Am. Home Prods. Corp. (In re Diet Drugs (Phentermine, Fenfluramine, Dexfenfluramine) Prods. Liab. Litig.), Nos. 1203, 99-20593, 2000 WL 1222042 (E.D.Pa. Aug.28, 2000). The plaintiff class was comprised of approximately six million people in the United States who had used Pondimin and Redux. The settlement agreement created a structure to compensate class members who were harmed by the diet drugs. It also provided class members the opportunity to exercise intermediate or back-end opt-out rights in the future, which permitted them to forego the settlement benefits and pursue their claims against American Home Products through the tort system (subject to restrictions). Under the agreement, American Home Products was prohibited from asserting the statute of limitations as a defense to a claim brought pursuant to the downstream opt-out provisions.

In March and April 2004, more than 2,000 former users of the diet drugs, having exercised their opt-out rights, brought 195 cases in the Massachusetts superior court against Wyeth, Inc., the corporate successor to American Home Products. Wyeth is a Delaware corporation with a principal place of business in New Jersey. The plaintiffs, most of whom are not Massachusetts residents, also named as defendants Indevus Pharmaceuticals, Inc., a Delaware corporation with a principal place of business in Massachusetts, and Boeh-ringer Ingelheim Pharmaceuticals, Inc., a Delaware corporation with a principal place of business in Connecticut. Indevus was involved in the development and marketing of Redux, and Boehringer was involved in its production. Indevus and Boehringer were not parties to the settlement agreement.

Wyeth has removed the 195 cases to this Court, arguing that the plaintiffs fraudulently joined Indevus as a defendant to defeat federal diversity jurisdiction. 1 Wyeth’s theory is that Indevus, a Massachusetts citizen for jurisdictional and removal purposes, should be disregarded as a party because the plaintiffs cannot, as a matter of law, assert any valid claims against Indevus. Specifically, Wyeth urges that any claims by the plaintiffs against Indevus are necessarily time-barred under Massachusetts law. 2 The plaintiffs have moved to remand the cases to the Massachusetts court. They argue that Indevus is a proper defendant, and that the removal of the cases was improper *201 under 28 U.S.C. § 1441(b). 3

II. Discussion

A. Wyeth’s motion to stay

There is one matter that must be resolved before the jurisdictional issue is addressed. Wyeth has moved to stay proceedings in these cases pending transfer to the MDL Court, arguing that the MDL Court, because of its jurisdiction over and experience with the class action diet drug cases, is in a better position to address the legal and factual issues presented by the plaintiffs’ motions to remand. Wyeth’s arguments are unconvincing, and its motion to stay shall be denied.

The Judicial Panel on Multidistrict Litigation (“JPML”) has entered conditional transfer orders indicating that, pursuant to 28 U.S.C. § 1407, these cases are to be transferred to the MDL Court in the Eastern District of Pennsylvania. See Conditional Transfer Order 126, dated Aug. 10, 2004, and Conditional Transfer Order 127, dated Aug. 17, 2004. However, the plaintiffs have objected to the transfer orders, and the transfer orders have been stayed until the issue is briefed and heard by the JPML.

JPML Rule 1.5 provides that “[t]he pen-dency of a ... conditional transfer order ... does not affect or suspend orders or pretrial proceedings in the district court in which the action is pending and does not in any way limit the pretrial jurisdiction of that court.” In a standard letter to this Court dated August 25, 2004, the JPML, citing Rule 1.5, advised:

Thus your jurisdiction continues until any transfer ruling becomes effective. If you have a motion pending before you in any of the actions — particularly a motion to remand to state court (if the action was removed to your court) — you are encouraged to rule on the motion unless you conclude that the motion raises issues likely to arise in other actions in the transferee court, should we order transfer, and would best be decided there.

For a number of reasons, I find that it is proper and efficient to rule on the pending motions to remand rather than wait for the JPML to decide whether to transfer the cases to the MDL Court. The primary issue presented by the motions to remand requires consideration of the Massachusetts statute of limitations and its qualifying “discovery rule”- — an issue as to which the MDL Court, respectfully, has no superior experience or expertise. Further, it does not appear that the issue, involving as it does Massachusetts law, is one that is likely to arise in other diet drug litigation in other courts. I am also not persuaded by Wyeth’s arguments that resolution of the motions to remand implicates issues that are within the exclusive jurisdiction of the MDL Court, such as interpretation of the settlement agreement; as indicated below, the motions to remand can be resolved without encroaching on the exclusive territory of the MDL Court. Accordingly, I, like several other federal district courts confronted with motions to stay and to remand, will deny Wyeth’s motion to stay and address the merits of the plaintiffs’ motions to remand. See, e.g., Collett v. Freid, Civ. Action No. 03-526 (E.D.Ky. July 15, 2004) (denying Wyeth’s motion to stay and plaintiffs motion to remand); Bejarano v. Wyeth, Civ. Action No. L-03-53 (S.D. Tex. June 27, 2003) (same).

*202 B. The plaintiffs’ motions to remand

1. Fraudulent joinder standard

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338 F. Supp. 2d 198, 2004 U.S. Dist. LEXIS 19346, 2004 WL 2181572, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-massachusetts-diet-drug-litigation-mad-2004.