60 F.3d 1071 (4th Cir. 1995), 94-1820, Shadburne-Vinton v. Dalkon Shield Claimants Trust

Docket Nº:94-1820.
Citation:60 F.3d 1071
Party Name:Susan SHADBURNE-VINTON, Plaintiff-Appellant, and William G. Vinton, Plaintiff, v. DALKON SHIELD CLAIMANTS TRUST, Defendant-Appellee. Oregon Trial Lawyers Association; Pharmaceutical Research and Manufacturers of America; The American Insurance Association, Amici Curiae.
Case Date:July 26, 1995
Court:United States Courts of Appeals, Court of Appeals for the Fourth Circuit
 
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Page 1071

60 F.3d 1071 (4th Cir. 1995)

Susan SHADBURNE-VINTON, Plaintiff-Appellant,

and

William G. Vinton, Plaintiff,

v.

DALKON SHIELD CLAIMANTS TRUST, Defendant-Appellee.

Oregon Trial Lawyers Association; Pharmaceutical Research

and Manufacturers of America; The American

Insurance Association, Amici Curiae.

No. 94-1820.

United States Court of Appeals, Fourth Circuit

July 26, 1995

Argued April 6, 1995.

Page 1072

ARGUED: Michael Albert Pretl, Pretl & Erwin, P.A., Baltimore, MD, for appellant. Dino Santo Sangiamo, Venable, Baetjer & Howard, Baltimore, MD, for appellee. ON BRIEF: Paul F. Strain, Elizabeth C. Honeywell, Venable, Baetjer & Howard, Baltimore, MD, for appellee. Arthur C. Johnson, Douglas C. Schaller, Johnson, Clifton, Larson & Corson, P.C., Eugene, OR, for amicus curiae Oregon Trial Lawyers; Bruce J. Brennan, Marjorie E. Powell, Washington, DC, for amicus curiae Pharmaceutical Research; Robert E. Scott, Jr., Christopher W. Poverman, Semmes, Bowen & Semmes, Baltimore, MD, for amicus curiae Ins. Ass'n.

Before RUSSELL and WIDENER, Circuit Judges, and CHAPMAN, Senior Circuit Judge.

Reversed by published opinion. Senior Judge CHAPMAN wrote the opinion, in which Judge RUSSELL joins. Judge WIDENER wrote a dissenting opinion.

OPINION

CHAPMAN, Senior Circuit Judge:

Appellant Susan Shadburne-Vinton ("Shadburne") was injured by a Dalkon Shield Intrauterine Device ("IUD") manufactured by A.H. Robins Company ("Robins") that she used from March, 1974 until December, 1976. She filed suit against Robins in January, 1983 in the United States District Court for the District of Maryland. Because Shadburne was an Oregon resident, Oregon law controlled, and the district court dismissed her suit under the Oregon statute of repose for failure to timely file. Shadburne appealed the dismissal; however, pending the appeal, Robins entered bankruptcy proceedings, and the bankruptcy court stayed all Dalkon Shield litigation. During the pendency of the bankruptcy proceedings, the Oregon legislature amended the statute of repose to exclude IUD manufacturers as a protected class of defendants.

Following the conclusion of the Robins bankruptcy proceedings in 1989, Shadburne sought to reinstate her initial claim. The Dalkon Shield Claimants Trust ("the Trust," substituted for Robins pursuant to reorganization) agreed to reinstatement, but reserved the right to challenge the amendment to Oregon's statute of repose. The Trust moved for judgment on the pleadings claiming that the amendment violated its due process rights and claiming that the original statute of repose governed Shadburne's suit.

Page 1073

On May 19, 1994, the district court granted the Trust's motion, and Shadburne appeals.

For the reasons discussed below, we reverse the district court's ruling.

I.

Shadburne received her first IUD in February, 1973 which was replaced by a second IUD in March, 1974. After an acute episode of pelvic inflammatory disease, the doctor surgically removed the IUD in December, 1976. Shadburne, along with many other plaintiffs, filed suit in Maryland district court 1 against Robins claiming that the IUD rendered her infertile and caused multiple sclerosis. Because Shadburne and the other plaintiffs were Oregon residents, Oregon's substantive law controlled. Robins moved for judgment on the pleadings on the basis of Oregon's original statute of repose which provided that "a product liability civil action shall be commenced not later than eight years after the date on which the product was first purchased for use or consumption." Or.Rev.Stat. Sec. 30.905(1) (1983) (current version at Or.Rev.Stat. Sec. 30.905(1) (1993)). On December 20, 1984, the district court granted Robins's motion finding that Shadburne filed suit more than eight years after she purchased the IUD. Shadburne and 41 other dismissed plaintiffs appealed.

During the pendency of the appeal, Robins filed for bankruptcy, and the bankruptcy court stayed all Dalkon Shield litigation. In 1987, while the bankruptcy proceedings continued, the Oregon legislature amended the statute of repose to exclude IUD manufacturers 2 as protected defendants. 1987 Or.Laws ch. 4 Secs. 5-10. Section 5 applied a two year discovery rule statute of limitations without the eight year repose feature, and section 6 made this rule applicable to all causes of action tried after the statute's effective date. Section 7 described a limitation of July 1, 1989, for filing such actions, and Sections 8 and 9 established a one year period for refiling actions that were dismissed based upon the prior statute, or to be first commenced within one year after the statute's effective date. Because the Robins bankruptcy proceeding was still not resolved in 1989, the Oregon legislature extended the filing period set forth in the 1987 legislation to actions filed before July 1, 1995. 1989 Or.Laws ch. 642 Sec. 1. 3 (The 1987 and 1989 statutes are referred to collectively as the "Special IUD Statute.") 4

When the Robins bankruptcy proceeding was not concluded by 1989, Shadburne and the Oregon plaintiffs secured a consent order from the bankruptcy court which tolled the time for filing suit under the Special IUD Statute until 30 days after the expiration or termination of the automatic stay.

Many of the other Oregon plaintiffs settled their disputes with the Trust. When the lead appellant, Ada June Tolliver, settled her claim, the Fourth Circuit erroneously dismissed the entire appeal, intending only to dismiss Tolliver's appeal. Shadburne did not file a motion for reconsideration to correct the clerical error and keep her case alive. Shadburne claims that she did not pursue the appeal of her earlier dismissal because she deemed the appeal mooted by the Special IUD Statute and the consent order.

Because the parties could not agree to a settlement, the bankruptcy court certified Shadburne's claim, and she filed an amended complaint in the district court on October 27, 1992. The Trust filed a motion for judgment on the pleadings on June 25, 1993, claiming that the Special IUD Statute was unconstitutional, and that under the original statute of repose, Shadburne's claim was properly dismissed.

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The district court granted the Trust's motion finding that the Special IUD Statute violated the Trust's due process rights under the Federal Constitution, and that the original statute of repose barred Shadburne's claim. Shadburne appeals arguing that the Oregon statute does not violate the Federal Constitution.

We review questions of law de novo. Richmond, Fredericksburg & Potomac R.R. v. United States, 945 F.2d 765, 768-69 (4th Cir.1991), cert. denied, 503 U.S. 984, 112 S.Ct. 1667, 118 L.Ed.2d 388 (1992).

II.

The district court found that retroactive enlargement of a statute of limitation does not violate the Due Process Clause of the Constitution, Chase Sec. Corp. v. Donaldson, 325 U.S. 304, 65 S.Ct. 1137, 89 L.Ed. 1628 (1945), yet retroactive enlargement of a statute of repose does. William Danzer & Co. v. Gulf & Ship Island R.R., 268 U.S. 633, 45 S.Ct. 612, 69 L.Ed. 467 (1925). The district court relied primarily upon a Fourth Circuit case that distinguishes statutes of limitation from statutes of repose because the former involve only procedural rights, while the latter involve substantive rights. Goad v. Celotex Corp., 831 F.2d 508 (4th Cir.1987), cert. denied, 487 U.S. 1218, 108 S.Ct. 2871, 101 L.Ed.2d 906 (1988). We find Goad inapplicable because it separates statutes of limitation from statutes of repose for choice of law purposes, and this case presents a constitutional issue. We find that in analyzing the constitutionality of retroactive legislation, statutes of repose are now treated the same as statutes of limitation.

III.

The Trust relies primarily upon William Danzer & Co. v. Gulf & Ship Island R.R., 268 U.S. 633, 45 S.Ct. 612, 69 L.Ed. 467 (1925), in which the plaintiff failed to file suit against a railroad within the time prescribed by the Interstate Commerce Act, which both created and limited the plaintiff's cause of action. Congress then enacted the Transportation Act which, if applied retroactively, would revive the plaintiff's claim. The railroad argued that reviving the plaintiff's expired cause of action violated its due process rights. The Court found "that the lapse of time not only barred the remedy but also destroyed the liability of defendant to plaintiff." William Danzer & Co., 268 U.S. at 636, 45 S.Ct. at 613 (citing Kansas City S. Ry. v. Wolf, 261 U.S. 133, 139, 43 S.Ct. 259, 260, 67 L.Ed. 571 (1923); U.S. ex rel. Louisville Cement Co. v. Interstate Commerce Comm'n, 246 U.S. 638, 642, 38 S.Ct. 408, 409, 62 L.Ed. 914 (1918); A.J. Phillips Co. v. Grand Trunk W. R.R., 236 U.S. 662, 666, 35 S.Ct. 444, 445, 59 L.Ed. 774 (1915)). The Court further noted that statutes are presumed to be prospective unless the statute expressly states otherwise, 5 and that it had recently held that the Transportation Act would not apply to causes of action which were barred by a state statute of limitations before the passage of the Act. Id. (citing Fullerton-Krueger Lumber Co. v. Northern Pac. Ry., 266 U.S. 435, 437, 45 S.Ct. 143, 143-44, 69 L.Ed. 367 (1925)). The Court held that sometimes a statute both creates a cause of action and places a limitation period on its existence, and the limitation period in such statutes serve as a limitation upon liability. The Court concluded that the expiration of the time period extinguished the defendant's liability, and to revive that liability would deprive the defendant of its property without due process of law. Id. at 637, 45 S.Ct. at 613.

The Supreme Court subsequently held in Chase Securities Corp. v. Donaldson, 325 U.S. 304, 65 S.Ct. 1137, 89 L.Ed. 1628 (1945), that retroactive application of a statute of limitation does not violate the Due Process Clause of the Fourteenth Amendment. The...

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