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Dunaway v. Purdue Pharma L.P.

United States District Court, M.D. Tennessee, Nashville Division

May 22, 2019

BRYANT C. DUNAWAY, et al. Plaintiffs,
v.
PURDUE PHARMA L.P., et al., Defendants.

          MEMORANDUM & ORDER

          ALETA A. TRAUGER, JUDGE

         The plaintiffs have filed a Motion to Remand (Docket No. 18), to which McKesson Corporation (“McKesson”) has filed a Response (Docket No. 54), and the plaintiffs have filed a Reply (Docket No. 56). McKesson, Cardinal Health, Inc., and AmerisourceBergen Drug Corporation (“Moving Defendants”) have filed a Joint Motion to Stay Proceedings (Docket No. 29), to which the plaintiffs have filed a Response (Docket No. 41). For the reasons set out herein, the Moving Defendants' motion will be denied, and the plaintiffs' motion will be granted.

         I. BACKGROUND

         The plaintiffs are District Attorneys General from judicial districts including Bedford County, Cannon County, Clay County, Giles County, and Van Buren County, along with Baby Doe, an infant allegedly born dependent on opioids. They filed suit against the defendants-a number of pharmaceutical companies, pharmacies, clinics, and individuals-in Cumberland County Circuit Court, alleging liability arising out of the defendants' actions related to opioid medications, including, in particular, many defendants' alleged filling of suspicious orders for opioid medications. The plaintiffs have pleaded two causes of action under the Tennessee Drug Dealer Liability Act (“TDDLA”), Tenn. Code Ann. §§ 29-38-101 to -116, one on behalf of Baby Doe and one on behalf of the DAGs' judicial districts. (Docket No. 1-3 ¶¶ 627-682.) On May 3, 2019, one of the defendants, McKesson Corporation, filed a Notice of Removal removing the case to federal court. (Docket No. 1.) As the basis for removal, McKesson asserted that, although the plaintiffs have pleaded only state-law causes of action, their claims “arise under federal law” for jurisdictional purposes because they involve duties under the federal Controlled Substances Act (“CSA”), 21 U.S.C. § 801 et seq. (Docket No. 1 ¶ 23.) The defendants point out that the plaintiffs' Second Amended Complaint alleges a number of CSA violations, including violations of the duty, under 21 U.S.C. § 823 and related regulations and DEA guidance, to report and suspend suspicious orders of opioid medications and to exercise due diligence to avoid filling orders that might be diverted to unlawful uses. See Masters Pharm., Inc. v. DEA, 861 F.3d 206, 212 (D.C. Cir. 2017) (discussing duties of prescription drug distributors under the CSA). (Docket No. 1-3 ¶¶ 305, 308, 329, 351.)

         The plaintiffs are far from the only parties to notice that pharmaceutical manufacturers, distributors, pharmacies, and others might face liability related to their sale, marketing, and/or distribution of dangerous and addictive opioids. Currently pending before Judge Dan Polster of the Northern District Ohio is multidistrict litigation (“MDL”) that includes more than 1, 800 opioid-related actions, including several originally filed in this district. Contemporaneously with the removal, one of the defendants, Purdue Pharma L.P., filed a notice with the Judicial Panel on Multidistrict Litigation (“JPML”) seeking to have this case transferred into that MDL.

         On May 10, 2019, the plaintiffs filed a Motion to Remand (Docket No. 18) in this court, arguing that the removal of the case to federal court was improper. Shortly thereafter, the Moving Defendants filed a Joint Motion to Stay Proceedings (Docket No. 29), arguing that the court should stay any consideration of the remand motion until the JPML determines whether the case will be transferred into the MDL. On May 16, 2019, the JPML entered a Conditional Transfer Order (Docket No. 44), proposing that the case be transferred into the MDL. Consistently with JPML Rules, the transfer will not take effect until, at the earliest, its entry on the docket of the U.S. District Court of the Northern District of Ohio. (Id. at 1.) If a party opposes the transfer, the transfer will be stayed indefinitely. (Id.)

         II. LEGAL STANDARD

         A. Stay

         A district court “has broad discretion to stay proceedings as an incident to its power to control its own docket.” Clinton v. Jones, 520 U.S. 681, 706-07 (1997) (citing Landis v. N. Am. Co., 299 U.S. 248, 254 (1936)). “The power to stay proceedings is incidental to the power inherent in every court to control the disposition of the causes [on] its docket with economy of time and effort for itself, for counsel and for litigants, and the entry of such an order ordinarily rests with the sound discretion of the District Court.” F.T.C. v. E.M.A. Nationwide, Inc., 767 F.3d 611, 626- 27 (6th Cir. 2014) (quoting Ohio Envtl. Council v. U.S. Dist. Court, 565 F.2d 393, 396 (6th Cir. 1977)).

         The Rules of Procedure of the U.S. Judicial Panel on Multidistrict Litigation expressly provide that the pendency of the Conditional Transfer Order has no bearing on this court's ability to consider a pretrial matter pending in a case filed in or removed to this court. See JPML R. 2.1(d). Nevertheless, “the district court certainly has discretion to grant a stay in the interests of judicial economy.” Glazer v. Whirlpool Corp., No. 1:08-CV-1624, 2008 WL 4534133, at *2 (N.D. Ohio Oct. 6, 2008). When considering a stay pending the resolution of a motion to transfer a case into an MDL, the district court balances the following factors: “(1) potential prejudice to the non- moving party; (2) hardship and inequity to the moving party if the action is not stayed; and (3) the judicial resources that would be saved by avoiding duplicative litigation if the cases are in fact consolidated.” Id. (quoting Rivers v. Walt Disney Co., 980 F.Supp. 1358, 1360 (C.D. Cal. 1997)).

         B. Remand

         Removal from state to federal court is appropriate for “any civil action brought in a State court of which the district courts of the United States have original jurisdiction.” See 28 USC § 1441(a). However, “[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c). A party also may file a motion to remand based on a “defect other than lack of subject matter jurisdiction, ” provided that the party does so within 30 days after the filing of the notice of removal. Id.

         III. ANALYSIS

         A. Motion to Stay

         The Moving Defendants argue that all three of the factors governing its stay request- prejudice to the non-moving parties, hardship to the moving parties, and judicial economy-favor a stay. They point to a number of other cases in which courts have stayed their consideration of remand motions pending the resolution of an MDL transfer request. See, e.g., Beshear v. Volkswagen Grp. of Am., Inc., 2016 WL 3040492, at *8 (E.D. Ky. May 25, 2016); McGraw -Hill Companies, Inc., 2013 WL 1785512, at *7 (M.D. Tenn. Apr. 25, 2013) (Sharp, J.); Karrels v. Morgan Asset Mgmt., Inc., 2010 WL 11565140, at *2 (M.D. Tenn. Jan. 6, 2010) (Echols, J.); Marshall v. Am. Gen. Life & Accident Ins. Co., 174 F.Supp.2d 709, 718 (M.D. Tenn. 2001) (Nixon, S.J.). (See also Docket Nos. 30-1 to -13.) The court, the Moving Defendants argue, should follow the lead of those courts and judges and allow the issue of remand to be resolved either by the MDL court or by this court after a transfer to the MDL has been rejected.

         This court does not deny that staying consideration of a remand motion pending an MDL transfer decision may often be appropriate. “As other district courts within the Sixth Circuit have recognized, the ‘general rule is for federal courts to defer ruling on pending motions to remand in MDL litigation until after the [JPML] has transferred the case.'” Beshear, 2016 WL 3040492, at *8 (quoting Kelly v. Aultman Physician Center, 2013 WL 2358583, *2 (N.D. Ohio May 29, 2013)). The fact that courts usually handle these matters one way, however, does not relieve this court of the necessity of considering whether a stay is warranted here. Indeed, the JPML's own rules explicitly make clear that no stay is mandated here, leaving the decision on how to proceed up to the original district court. JPML R. 2.1(d).[1] Based on the court's balancing of the factors relevant to whether a stay should be granted, the court concludes that proceeding with consideration of the plaintiffs' motion is warranted.

         First, the risk of hardship resulting from a postponement of a jurisdictional determination is great. If transferred, this case will join a veritable sea of others in the MDL court. There is no guarantee of when that heavily burdened court would be able to address the important jurisdictional issues raised here. This court, however, is prepared to address those jurisdictional issues now. The prospect of indefinitely postponing a jurisdictional ruling is especially troubling, given that this case involves Tennessee public officials, charged with representing the interests of the citizens of their respective judicial districts, seeking access to the state's courts to assert claims under the state's laws. There is nothing inherently objectionable about a federal court considering state-law claims involving state and local officials, as long as it does so pursuant to its limited constitutional and statutory jurisdiction. If that ...


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