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From Products Liability Law Daily, May 18, 2015

Propoxyphene plaintiffs sing “California Here I Come”

By Pamela C. Maloney, J.D.

A federal district court in Kentucky has recommended that strict liability and negligent failure-to-warn and design defect claims against various manufacturers of generic pain medications containing propoxyphene be sent back to the federal district courts in California from which they were transferred to the multi-district litigation pending in Kentucky. Finding that the Class Action Fairness Act’s “mass action” provision was the only basis for removal, the court suggested remand because the majority of the patients had not consented to removal and there was no basis for federal jurisdiction other than CAFA’s mass tort provision (In re Darvocet, Darvon, and Propoxyphene Products Liability Litigation, May 15, 2015, Reeves, D.).

Procedural history. The district court’s July 25, 2013 order remanding these cases to a California trial court (see Products Liability Law Daily’s July 29, 2013 analysis) was vacated by the U.S. Court of Appeals for the Sixth Circuit; however, that decision was held in abeyance pending a decision by the U.S. Court of Appeals for the Ninth Circuit regarding whether a similar petition for coordination under §404 was a proposal for a joint trial, which also would render those cases a “mass action” as defined in CAFA. In Corber v. Xanodyne Pharm., Inc. (see Products Liability Law Daily’s November 19, 2013 analysis), the Ninth Circuit determined that it had jurisdiction over these cases under CAFA and denied the motions to remand filed by two of the MDL plaintiffs.

Remand motion. Under its multi-district litigation provision, CAFA prohibits transfer of any action removed on mass action grounds absent consent by a majority of the patients, unless there are other grounds for federal jurisdiction. The patients argued that the drug manufacturers’ non-CAFA grounds for jurisdiction were meritless and, therefore, that the cases were subject to CAFA’s transfer preclusion.

The federal court responded that it had already determined that removal from state to federal court was proper under CAFA, and that it remained to be determined whether the cases were properly before it, as transferee court, on the grounds of either diversity jurisdiction or federal question jurisdiction, or whether they should be transferred back to the federal district courts in California.

Diversity jurisdiction. The generic drug manufacturers had argued that one of the companies—a citizen of California—had been fraudulently joined to defeat diversity. The basis for the fraudulent joinder argument was that the claims against the California company were preempted under PLIVA, Inc. v. Mensing. Because preemption went to the merits of the action and it would be inappropriate for the MDL court to analyze whether the claims against that company were preempted, the court held that preemption could not be used to demonstrate that a defendant had been fraudulently joined. The court further explained that it had already refused to apply the fraudulent misjoinder doctrine in the cases at hand because of the unsettled law surrounding the doctrine.

Federal question jurisdiction. The generic drug makers also argued that the court had federal question jurisdiction over the claims to the extent that they alleged the drug manufacturers failed to update their labels to match certain changes ordered by the Food and Drug Administration. The court rejected this argument, agreeing with the patient’s counter argument that the claims were based on a state law duty to provide adequate warnings. Although the patient’s complaints contained allegations that the generic drug makers had failed to update their labels to reflect the changes approved by the FDA, that was not the only theory of liability. According to the court, a jury could find negligence or strict liability on the part of the manufacturers without finding a violation of federal law.

Finding that although the assertion of additional grounds for removal allowed the initial transfer of these claims, the court announced that nothing precluded it from evaluating those additional grounds and suggesting that the transfer be undone if those grounds failed. In this case, the additional grounds did fail and, thus, the court suggested remand.

The case is Master File No. 2: 11-md-2226-DCR; MDL Docket No. 2226

Attorneys: James Paul Sizemore (Sizemore Law Firm), and Matthew J. Sill (Sill & Medley PLLC) for Plaintiffs. Gina M. Saelinger (Ulmer & Berne, LLP) for Xanodyne Pharmaceuticals, Inc. Dominique C. Price (Ice Miller LLP) for Eli Lilly and Co. Ginger Pigott (Greenberg Traurig) for Teva Pharmaceuticals USA, Inc. Bradley A. Matta (Pietragello Gordon Alfano Bosick & Raspanti LLP) for Mylan Pharmaceuticals, Inc. Carla De La Barra Helstrom (Frost Brown Todd LLC) for Propst Distribution, Inc. Farley J. Neuman (Goodman Neuman Hamilton LLP) for McKesson Corp.

Companies: Xanodyne Pharmaceuticals, Inc.; Eli Lilly and Co.; Teva Pharmaceuticals USA, Inc.; Mylan Pharmaceuticals, Inc.; Propst Distribution, Inc.; McKesson Corp.

MainStory: TopStory JurisdictionNews DrugsNews ClassActLitigationNews KentuckyNews CaliforniaNews

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