United States District Court, E.D. Virginia, Richmond Division
E. Payne Senior United States District Judge.
matter is before the Court on the PLAINTIFF'S MOTION TO
REMAND AND INCORPORATED MEMORANDUM OF LAW (ECF No. 7);
PLAINTIFF'S SUPPLEMENTAL MOTION TO REMAND AND
INCORPORATED MEMORANDUM OF LAW (ECF No. 8); and MOVING
DEFENDANTS' MOTION FOR TEMPORARY STAY OF PROCEEDINGS
PENDING LIKELY TRANSFER TO MULTIDISTRICT LITIGATION (ECF No.
22) . The Court has reviewed the supporting, opposing, and
reply memoranda. For the reasons stated below,
PLAINTIFF'S MOTION TO REMAND AND INCORPORATED MEMORANDUM
OF LAW (ECF No. 7) and PLAINTIFF'S SUPPLEMENTAL MOTION TO
REMAND AND INCORPORATED MEMORANDUM OF LAW (ECF No. 8) will be
granted, and MOVING DEFENDANTS' MOTION FOR TEMPORARY STAY
OF PROCEEDINGS PENDING LIKELY TRANSFER TO MULTIDISTRICT
LITIGATION (ECF No. 22) will be denied.
Dinwiddie County filed this action against the defendants in
the Circuit Court of Dinwiddie County, Virginia. Dinwiddie
County groups the defendants into the following categories:
(1) the ''Manufacturer Defendants," who are
alleged to have directly caused a public health crisis by
failing to adhere to FDA regulations and by failing to
implement measures to prevent the filing of suspicious
orders; (2) the "Distributor Defendants/' who
purchased opioids from the Manufacturer Defendants and
allegedly failed to effectively monitor and report suspicious
orders of prescription opioids or to implement measures to
prevent the filing of invalid prescriptions; (3) the
"Pharmacy Benefit Manager Defendants" (a.k.a. the
"PBM Defendants"), who established formularies to
reimburse pharmaceutical companies thereby perpetuating the
opioid epidemic; and (4) the "Doe Defendants," who
were sued under a fictitious name for participating in the
activities that caused the opioid epidemic and for helping
the other defendants. See generally Compl. (ECF No.
1-1). In general, the Complaint alleges that the defendants,
singularly and collectively, helped cause the opioid epidemic
that has resulted in economic, social, and emotional damage
to "virtually every community in the United
States," all while benefitting themselves economically
by manufacturing and selling the opioids while knowing about
their addictive properties, distributing them to points of
delivery for patients, and prescribing them through pharmacy
plan design and formulary management. Id.
134-page complaint, most of the allegations are against
defendants who do not reside in Virginia. However, there are
three Distributor Defendants that are Virginia residents:
McKesson Medical-Surgical Inc.; General Injectables &
Vaccines, Inc.; and Insource, Inc. The Complaint alleges that
the Distributor Defendants (as well as the manufacturing
defendants) ignored Virginia law and the Controlled
Substances Act (the "CSA"), thereby causing many
people to become addicted to drugs. Id. ¶¶
286-93. The Complaint alleges that the Distributor Defendants
did not maintain effective controls against opioid diversion
and did not follow DEA guidance. Id. ¶¶
309-33. The causes of action against the Distributor
Defendants are the following. First, Count I alleges that all
the defendants created a public nuisance, and, against the
Distributor Defendants specifically, the Complaint states
that they failed to implement effective controls or operate
system to report suspicious orders and that they enabled
"pill mills" to operate in the market. Id.
¶¶ 437-38. Second, Count II alleges that all the
defendants created a common law public nuisance and contains
the same factual allegations as Count I against the
Distributor Defendants. Id. ¶¶ 467-68.
Third, Count V alleges that all the defendants participated
in a common law civil conspiracy, and, against the
Distributor Defendants specifically, Dinwiddie County alleges
that they violated Virginia law and the CSA by fraudulently
making false or misleading statements, by falsely marketing
opioids as safe for treatment of chronic pain, by evading
controls on opioid diversion, and by failing to design and
operate a system for suspicious orders. Id.
¶¶ 509, 512-14. Fourth, Count VII alleges
negligence per se against the Distributor Defendants, stating
that they failed to disclose suspicious orders and filled
suspicious transactions. Id. ¶¶ 527-34.
Fifth, Count VIII alleges negligence against all the
defendants, and, against the Distributor Defendants
specifically, Dinwiddie County alleges that they failed in
their duty to not create a foreseeable risk of harm to
others. Id. ¶¶ 535-42. Sixth, Count IX
alleges gross negligence against all the defendants, and,
against the Distributor Defendants specifically, Dinwiddie
County alleges that they failed to take action to prevent
unnecessary, nonmedical, or criminal use of opioids.
Id. ¶¶ 543-47. Seventh, Count X alleges
willful and wanton negligence against all the defendants, and
it contains the same allegations as Count IX. Id.
¶¶ 548-53. Finally, Count XI alleges that all the
defendants were unjustly enriched by knowingly profiting from
opioid purchases that they knew were causing harm.
Id. ¶¶ 554-57.
Mallinckrodt LLC and SpecGX LLC (collectively,
"Mallinckrodt") filed MALLINCKRODT LLC AND SPECGX
LLC'S NOTICE OF REMOVAL (ECF No. 1) based on the
contention that there is diversity jurisdiction in this case.
Defendants Express Scripts Holding Company and Express
Scripts, Inc. (collectively, "Express Scripts")
submitted a SUPPLEMENTAL NOTICE OF REMOVAL (ECF No. 2),
arguing that there is federal question jurisdiction in this
case. In response to these notices of removal, Dinwiddie
County filed PLAINTIFF'S MOTION TO REMAND AND
INCORPORATED MEMORANDUM OF LAW (ECF No. 7) and
PLAINTIFF'S SUPPLEMENTAL MOTION TO REMAND AND
INCORPORATED MEMORANDUM OF LAW (ECF No. 8). Further, Express
Scripts filed MOVING DEFENDANTS' MOTION FOR TEMPORARY
STAY OF PROCEEDINGS PENDING LIKELY TRANSFER TO MULTIDISTRICT
LITIGATION (ECF No. 22), asking this Court to delay its
decision on whether to remand the case pending the final
decision of the Judicial Panel on Multidistrict Litigation
(the "JPML") on transfer of this action to the
Multidistrict Litigation pending in the Northern District of
Ohio, In Re; Nat'l Prescription Opiate Litig.,
No. 1:17-md02804 (the "Opiate MDL").
Other District Courts' Responses To Similar
this case has been pending here, other judges, in this
district and across the country, have decided whether to stay
the proceedings in their cases so that the JPML could decide
whether to transfer the cases to the Opiate MDL. Some
district courts have decided to stay their proceedings,
stating in relatively short orders that the judicial
cooperation and consistency were their preeminent concerns.
See, e.g., Fauquier County v. Mallinckrodt,
LLC, No. 1:19-cv-364, ECF No. 33 (E.D. Va. April 17,
2019); Bd. of Supervisors of Prince William Cty. v.
Purdue Pharma, L.P., No. 1:19-cv-365, ECF No. 27 (E.D.
Va. April 18, 2019); City of Chesapeake v. Purdue Pharma,
L.P., No. 2:19-cv-183, ECF No. 26 (E.D. Va. April 24,
2019); Fairfax County v. Purdue Pharma, L.P., No.
1:19-cv-544, ECF No. 21 (E.D. Va. May 16, 2019); Franklin
County v. Purdue Pharma, L.P., No. 7:19-cv-302, ECF No.
33 (W.D. Va. May 1, 2019); Alleghany County v. Purdue
Pharma, L.P., No. 7:19-cv-275, ECF No. 31 (W.D. Va. May
1, 2019); Roanoke County v. Purdue Pharma, L.P., No.
7:19-cv-271, ECF No. 34 (W.D. Va. May 16, 2019); City of
Roanoke v. Purdue Pharma, L.P., No. 7:19-cv-272, ECF No.
38 (W.D. Va. May 16, 2019); City of Bristol v. Purdue
Pharma, L.P., No. 1:19-cv-11, ECF No. 35 (W.D. Va. May
16, 2019); City of Salem v. Purdue Pharma, L.P., No.
7:19-cv-273, ECF No. 31 (W.D. Va. May 16, 2019); Halifax
County v. Purdue Pharma, L.P., No. 4:19-cv-21, ECF No.
28 (W.D. Va. May 16, 2019); Rockbridge v. Purdue Pharma,
L.P., No. 6:19-cv-25, ECF No. 30 (W.D. Va. May 16,
2019); City of Lexington v. Purdue Pharma, L.P., No.
6:19-cv-21, ECF No. 39 (W.D. Va. May 16, 2019). Other
district courts have remanded the cases to state court,
finding that the cases should be remanded immediately because
there clearly was a lack of federal jurisdiction. See
Cty. Bd. of Arlington Cty. v. Purdue Pharma, L.P., No.
1:19-cv-402, ECF No. 63 (E.D. Va. May 6, 2019); Dunaway
v. Purdue Pharma, L.P., No. 2:19-cv-38, ECF No. 59
(M.D.T.N. May 22, 2019); see also, e.g., Mayor
and City Council of Baltimore v. Purdue Pharma, L.P, No.
18-800, 2018 WL 1963816, at *3 (D. Md. April 25, 2018)
(collecting cases in which federal courts have granted
motions to remand before the JPML could transfer the cases to
the MDL court). The Court has not been notified of any
decision in these similar cases in which a court has found
that there was federal jurisdiction.
The JPML And The Court's Jurisdiction Over This
JPML has issued Conditional Transfer Order 89
("CTO-89"). However, this Court still has
jurisdiction to consider motions to remand while the JPML
decides whether to enter the transfer order. See Moore v.
Wveth-Ayerst Labs., 236 F.Supp.2d 509, 511 (D. Md. 2002)
("The Judicial Panel on Multidistrict Litigation has
held that a district court judge has the authority to either
wait for a transfer order without ruling on a motion to
remand, or to rule on the motion before a transfer order has
been issued." (citing In re Asbestos Prods.
Liab. Litig., 170 F.Supp.2d 1348, 1349 n.1 (JPML 2001)).
Indeed, the Rules of Procedure of the United States Judicial
Panel on Multidistrict Litigation expressly provide that a
conditional transfer order "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." R. Pro. JPML 2.1(d). Thus,
the Court can properly entertain the motion to remand.
Removal And Federal Court Jurisdiction
courts are courts of limited jurisdiction and the threshold
requirement in every federal case is jurisdiction."
Holt v. Food Lion Grocery Store of Chester, No.
3:18-cv-503, 2019 WL 112788, at *2 (E.D. Va. Jan. 4, 2019)
(quoting Lee v. Citimortgage, Inc., 739 F.Supp.2d
940, 942 (E.D. Va. 2010)). Typically, "any civil action
brought in a State court of which the district courts of the
United States have original jurisdiction, may be removed by
the defendant or the defendants, to the district court of the
United States for the district and division embracing the
place where such action is pending." 28 U.S.C. §
1441(a). Where a defendant seeks to remove a case from state
to federal court, "it is the defendant who carries the
burden of alleging in his notice of removal and, if
challenged, demonstrating the court's jurisdiction over
the matter." Strawn v. AT & T Mobility,
LLC, 530 F.3d 293, 296 (4th Cir. 2008). The removing
defendant's burden of demonstrating federal jurisdiction
"is no greater than is required to establish federal
jurisdiction as alleged in a complaint." Ellenburq
v. Spartan Motors Chassis, Inc., 519 F.3d 192, 200 (4th
Cir. 2008). That said, it is well- settled that "removal
jurisdiction is not a favored construction," and,
therefore, the Court "must construe it strictly in light
of the federalism ...