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From Products Liability Law Daily, May 15, 2014

Ethicon’s attorneys sanctioned for wrongful removal of transvaginal surgical mesh case

By Harold M. Bishop, J.D.

The law firm representing Ethicon Women’s Health and Urology, Ethicon, Inc., Gynecare, and Johnson & Johnson (Ethicon) in the Ethicon Multidistrict Litigation (MDL), relating to alleged defects in their transvaginal surgical mesh has been sanctioned for improper removal of a case to federal court. The law firm filing the notice of removal was sanctioned in the amount equal to plaintiff Ann Wilson’s (Wilson) costs and attorneys’ fees incurred in handling a motion to remand her case to state court. The full amount of the sanction will be determined by the court after Wilson has filed an accounting of her fees and costs with the federal district court (Wilson v Ethicon Women’s Health and Urology, May 13, 2014, Goodwin, J).

Background. This case is one of approximately 18,000 cases which have been filed against Ethicon, Inc. and related entities in the Ethicon MDL for alleged defects in their transvaginal surgical mesh used to treat stress urinary incontinence and pelvic organ prolapse. On July 13, 2011, the FDA issued warning regarding transvaginal placement of surgical mesh.

In 2013, Ethicon began removing cases filed in the Court of Common Pleas of Philadelphia County to the U.S. District Court in West Virginia. Ethicon claimed that these removals were proper because another defendant, Secant Medical, LLC (Secant), had been fraudulently joined. On December 19, 2013, however, the federal district court issued an order finding that Secant had not been fraudulently joined and remanding three cases to the Pennsylvania state courts.

Nevertheless, Ethicon continued to remove cases to federal court and continued to argue that Secant had been fraudulently joined. In several cases, Ethicon also argued that the federal court had federal question jurisdiction over the plaintiffs’ claims. The court, however, reiterated its finding that Secant had not been fraudulently joined, and in an April 3, 2014 order, found that the state court cases did not present a federal question under 28 U.S.C. Sec. 1331. In this Wilson case, Ethicon based its removal solely on federal question jurisdiction and did not pursue the fraudulent joinder argument. In response, Wilson asked the federal court for sanctions under Federal Rule 11, which provides for sanctions if, applying an objective standard of reasonableness, a reasonable attorney in similar circumstances could not have believed his actions to be legally justified.

Analysis. The federal court found that Ethicon’s continued removal of these cases ignored both prior decisions of the court and clearly established federal law, which requires that the basis for federal question jurisdiction appear on the face of the well-pleaded complaint. However, Ethicon argued that the federal court should exert federal question jurisdiction because of an affirmative defense that co-defendant Secant intended to raise. Specifically, Ethicon argued that Secant, as a biomaterials supplier under The Biomaterials Access Assurance Act of 1998 (BAAA) (P.L. 105-230) (21 U.S.C. Secs. 1601 et seq.), has an affirmative defense of immunity because the BAAA provides immunity to biomaterials suppliers who provide component parts to manufacturers of medical devices.

The court, however, took the position that once Ethicon realized the court would not be changing its mind regarding fraudulent joinder of Secant, it then attempted to argue that the court had federal question jurisdiction over Wilsons’ state tort law claims. The court declared this argument entirely without merit, finding that neither the BAAA nor existing caselaw changed the long-standing rule that the basis for federal question jurisdiction must be found in the well-pleaded complaint. In fact, according to the court, the BAAA itself provides that nothing in the BAAA may be construed to create a cause of action or federal court jurisdiction that otherwise would not exist under applicable federal or state law. In addition, the court noted that in 2009 the U.S. Supreme Court held, inVaden v Discover Bank, 556 U.S. 49, 60-61, that federal jurisdiction cannot be premised upon a defense or counterclaim.

Conclusion. The court concluded that a reasonable attorney in like circumstances would not have thought his removal actions to be legally justified. Because other courts have found sanctions to be appropriate in similar circumstances, the court decided that Ethicon’s removal of this case violated Rule 11 and warranted sanctions.

In determining the appropriate sanctions, the court noted that the actions of defense counsel, Drinker Biddle & Reath LLP, were not motivated by ignorance of the law, but by a desire to keep these cases out of state court for as long as possible and to waste the court’s time and Wilson’s resources. As such, the court awarded Wilson attorney’s fees and costs for pursuing its motion and sanctioned the defense counsel for the same amount.

The case number is 2:14-cv-13542.

Attorneys: Lee B. Balefsky (Kline & Specter) for Ann Wilson. Andrew P. Reeve (Drinker Biddle & Reath) for Ethicon Women's Health and Urology; Ethicon Inc.; Gynecare; and Johnson & Johnson. Joe H. Tucker, Jr (Tucker Law Group) for Secant Medical, Inc.

Companies: Ethicon Women's Health and Urology; Ethicon Inc.; Gynecare; Johnson & Johnson; Secant Medical, Inc.

MainStory: TopStory JurisdictionNews MedicalDevicesNews WestVirginiaNews

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