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. 8);
PLAINTIFF'S SUPPLEMENTAL MOTION TO REMAND AND
INCORPORATED MEMORANDUM OF LAW (ECF No. 9); and MOVING
DEFENDANTS' MOTION FOR TEMPORARY STAY OF PROCEEDINGS
PENDING LIKELY TRANSFER TO MULTIDISTRICT LITIGATION (ECF No.
10) . 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. 8) and PLAINTIFF'S SUPPLEMENTAL MOTION TO
REMAND AND INCORPORATED MEMORANDUM OF LAW (ECF No. 9) will be
granted, and MOVING DEFENDANTS' MOTION FOR TEMPORARY STAY
OF PROCEEDINGS PENDING LIKELY TRANSFER TO MULTIDISTRICT
LITIGATION (ECF No. 10) will be denied.
Mecklenburg County filed this action against the defendants
in the Circuit Court of Mecklenburg County, Virginia.
Mecklenburg 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.
135-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. ¶¶
285-93. The Complaint also 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, Mecklenburg 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, Mecklenburg 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
Mecklenburg County alleges that the defendants 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.
Actavis LLC ("Actavis") filed DEFENDANT ACTAVIS
LLC'S NOTICE OF REMOVAL (ECF No. 1) based on the
contention that there is diversity jurisdiction in this case.
Defendants Optum, Inc., OptumRx, Inc., and UnitedHealth Group
Incorporated (collectively, "Optum") submitted a
SUPPLEMENTAL NOTICE OF REMOVAL (ECF No. 7), arguing that
there is federal question jurisdiction in this case. In
response to these notices of removal, Mecklenburg County
filed PLAINTIFF'S MOTION TO REMAND AND INCORPORATED
MEMORANDUM OF LAW (ECF No. 8) and PLAINTIFF'S
SUPPLEMENTAL MOTION TO REMAND AND INCORPORATED MEMORANDUM OF
LAW (ECF No. 9) . Further, Optum filed MOVING DEFENDANTS'
MOTION FOR TEMPORARY STAY OF PROCEEDINGS PENDING LIKELY
TRANSFER TO MULTIDISTRICT LITIGATION (ECF No. 10), 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-md- 02804 (the "Opiate
This Court's And Other District Courts' Responses To
Court previously addressed the same arguments made for
removal in Dinwiddie County, Virginia v. Purdue Pharma,
L.P., No. 3:19-cv-242, 2019 WL 2518130 (E.D. Va. June
18, 2019). There, the Court remanded the case to the Circuit
Court of Dinwiddie County, finding the defendants'
arguments for federal jurisdiction meritless. The
Dinwiddie County opinion noted that 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.
Id. at *2. 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). And, it noted that 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.
Tenn. 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
28, 2019, the JPML issued Conditional Transfer Order 101
rCTO-101"). See Conditional Transfer Order 101 (ECF No.
11-5) . However, this Court still has jurisdiction to
consider motions to remand while the JPML decides whether to
enter the transfer order. See Moore v. Wyeth-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.l (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." Strawnv. 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." Ellenburg
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 concerns ...