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Cardoza v. Medical Device Business Services, Inc.

United States District Court, W.D. Virginia, Danville Division

May 8, 2019

SUSAN O. CARDOZA, Plaintiff,


          Elizabeth K. Dillon, United States District Judge

         Plaintiff Susan O. Cardoza is a Virginia resident who alleges that the liner of her hip implant, which was implanted during a total hip replacement, fractured shortly after being implanted, requiring her to have emergent revision surgery. Because some of the fractured pieces could not be removed-in either her first revision surgery or a second revision surgery- she continues to have shards of the liner in her body.

         Cardoza filed suit in the Circuit Court for the City of Danville. Her complaint names five out-of-state defendants, all of whom have some relationship to the development, manufacture, or distribution of the hip implant and/or the liner, and it also names three Virginia residents as defendants. For purposes of this opinion, the court groups the out-of-state defendants into two groups. The first is the DePuy Defendants, [1] who filed the notice of removal, removing the case to this court and invoking the court's diversity jurisdiction. The second group is the CeramTec Defendants.[2] The first six counts of Cardoza's complaint are breach of warranty and failure to warn claims brought against one or more of the out-of-state defendants.

         In addition to those product liability claims, Cardoza's complaint also asserts three additional state-law claims: a “spoliation” claim; a claim for wrongful disclosure of medical information; and conversion. Those claims arise out of her allegation that, despite her surgeon's pre-surgery assurances that he would give her the parts of the implant that were removed, those pieces were not provided to her, but were instead given to the DePuy Defendants, where they were “examined, inspected, and tested.” (Compl. ¶ 34.) Although the parts have since been returned to her, she alleges that their condition and the lack of any information about the chain of custody makes it “virtually impossible for [her] to determine with reasonable certainty the root cause of her injuries and damages.” (Id. ¶ 6.)

         The “spoliation” claim appears to be asserted only against the DePuy Defendants. The other two state-law claims are asserted against the DePuy Defendants and the three Virginia residents. (Id. ¶¶ 84-99.) The Virginia residents are: (1) the Danville Regional Medical Center (the Hospital), which is the entity that operates the Danville, Virginia hospital where Cardoza's hip implant was removed in her first revision surgery; (2) Spectrum Medical, Inc. (Spectrum), a healthcare provider whose services include orthopedic surgery and who is the employer or principal of Cardoza's surgeon for the revision surgery; and (3) Matt Wimbish, a manufacturer's representative for the DePuy Defendants who was present in the operating room during that surgery and who, Cardoza alleges, took portions of the implant after their removal and provided them to the DePuy Defendants, all without Cardoza's permission.

         Pending before the court are two motions: (1) Cardoza's motion to remand; and (2) the DePuy Defendants' motion to stay, which asks the court to stay the case and delay consideration of the motion to remand pending a decision by the Judicial Panel on Multidistrict Litigation (JPML) on whether these cases will be transferred to a pending multi-district litigation action, In re DePuy Orthopaedics, Inc., Pinnacle Hip Implant Products Liability Litigation, MDL No. 2244 (the MDL). The motion to remand and motion to stay are fully briefed and were argued before the court on April 10, 2019.

         For the reasons set forth herein, the court will grant in part the motion to remand, but will deny it insofar as it requests an award of attorneys' fees and costs and will deny as moot the motion to stay.[3]

         I. BACKGROUND

         A. Factual Background[4]

         In broad strokes and as relevant to the issues currently before the court, Cardoza alleges that there was a manufacturing defect in the ceramic liner that is part of the hip replacement system implanted in her in December 2016. She began having pain and problems with the hip about three months later, and physical examination and x-ray imaging led the surgeon to conclude that the product had malfunctioned and that she needed emergent revision surgery. She underwent that surgery on March 10, 2017. Prior to the surgery, she specifically requested that her surgeon give her the parts that were removed from her body, and he agreed that the removed parts would be preserved and given to her.

         During the surgery, the surgeon found that the ceramic liner had “fractured in multiple planes” and sharp fragment shards had been deposited into her body. The surgeon was unable to remove all of them, despite his best efforts. During the surgery, while Cardoza “was under general anesthesia, ” Wimbish took possession of the shattered pieces of the ceramic liner which had been removed from Cardoza's body. He did so while acting within the scope of his employment with DePuy or as an agent of DePuy, and in furtherance of their interests.

         Although the chain of custody is “unknown, ” those fragments ultimately were “examined, inspected and tested” in Warsaw, Indiana, and in Leeds, England. The month following the surgery, Cardoza's attorneys began trying to obtain all of the removed pieces. Their efforts included sending preservation letters to the DePuy Defendants and to the Hospital requesting the parts and requesting their preservation as evidence. The Hospital, which had retained physical possession of the “cracked femoral head, ” refused to provide it to Cardoza without a “subpoena.” (Compl. ¶¶ 36-37.) After repeated requests from Cardoza's counsel, the DePuy Defendants delivered to Cardoza's counsel “what purported to be the shattered components” of the “explanted prosthesis.” (Compl. ¶ 41.) They were in an “unsecured Ziploc bag with insufficient and confusing identifying information.” (Id.) Cardoza alleges that under the circumstances and because of defendants' conduct, it is “virtually impossible” for her to determine the root cause of her injuries and damage. (Compl. ¶ 42.)

         As a factual matter, the DePuy Defendants rely heavily on a consent form signed by Cardoza to defeat Cardoza's claims against the in-state defendants. The form, which was attached to the Notice of Removal, was signed by Cardoza and her surgeon three days prior to her revision surgery and is titled a “Consent to Operation, Treatment or Other Procedure.” (Notice of Removal Ex. 1, Dkt. No. 1-1.) That document states that Cardoza “authorize[s] and consent[s] to the disposal, use, retention or donation by the hospital, at its discretion, of all . . . materials and substances that would normally be removed in the course of the operation . . . .” (Id.)

         The court requested supplemental briefing from the parties as to whether the court could properly consider that document. That issue, as well as the factual significance of the document, is discussed in context below.

         B. Procedural History

         1. Removal

         Cardoza filed suit in the Circuit Court for the City of Danville, and the DePuy Defendants timely removed the case to this court, invoking this court's diversity jurisdiction under 28 U.S.C. § 1332. As noted, Counts I through VI name either DePuy Defendants or CeramTec Defendants. In addition to naming those companies-all of which have a connection to the hip implant system or its components-Cardoza also has named as defendants the three Virginia residents described above: the Hospital, Spectrum, and Wimbish. Cardoza argues that the existence of these Virginia defendants in the suit destroys diversity jurisdiction and requires remand. She also makes a threshold argument that remand is required because of the removing defendants' failure to comply with technical aspects of the removal statute.

         The DePuy Defendants counter that the non-diverse defendants are fraudulently joined because Cardoza has no possibility of succeeding on the two counts in which they are named: Count VIII, wrongful disclosure of medical information, and Count IX, conversion.[5] They also argue, in the alternative, that even if the non-diverse defendants are not fraudulently joined, Counts VIII and IX are “fraudulently misjoined” under Rule 20. Accordingly, they contend that “plaintiff's claims against the non-diverse defendants cannot defeat diversity jurisdiction.” (Defs.' Combined Mem. 17, Dkt. No. 19.) Defendants ask that the court stay the proceedings, or in the alternative, deny the motion to remand. (Id. at 20.) They also suggest that the court could sever the claims against the non-diverse defendants and assert jurisdiction over the products liability claims.

         2. The MDL

         After this case was filed, the DePuy Defendants designated this case as a tag-along action in the MDL. Although the JPML initially declined to include the case in the MDL (Dkt. Nos. 6, 8), it subsequently reversed course. It later issued a conditional transfer order (CTO) (MDL No. 2244, Dkt. No. 2064), which plaintiff has opposed and moved to vacate. (MDL No. 2244, Dkt. Nos. 2975, 2099.) According to Cardoza, the MDL matter was fully briefed as of April 9, 2019. The JPML has stated that the issued will be heard, without oral argument, at the Panel's May 30, 2019 hearing. (MDL No. 2244, Dkt. No. 2126.) At the hearing in this court, counsel for the DePuy Defendants represented that it expected a ruling from the Panel a week or two after the hearing.

         As the parties agree, the CTO does not affect this court's ability or authority to rule on the remand motion. See J.P.M.L. Rule of Procedure 2.1(d) (“The pendency of a conditional transfer order . . . before the Panel . . . does not affect or suspend orders and pretrial proceedings in any pending federal district court action and does not limit the pretrial jurisdiction of that court.”) If and when a final transfer order is issued, however, this court will have no authority to address the motions to remand. The DePuy Defendants' motion to stay asks the court to stay a decision on the pending motion to remand until after a final transfer order is issued. Especially because the parties seem to believe it is likely that this case will get transferred absent any action by this court, the motion to stay effectively requests that this court allow the MDL court to rule on the motion for remand.


         A. ...

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