Burrows v. DePuy Orthopaedics, Inc. (In re DePuy Orthopaedics, Inc. ASR Hip Implant Prods. Liab. Litig.)

• Decision Date: 27 March 2020
• Docket Number: 3507,3511,3513,3510,3512,Nos. 19-3494/3501/3503/3504/3505/3506/,3508,s. 19-3494/3501/3503/3504/3505/3506/
• Citation: 953 F.3d 890
• Parties: IN RE: DEPUY ORTHOPAEDICS, INC. ASR HIP IMPLANT PRODUCTS LIABILITY LITIGATION. Linda Boal and David Boal (19-3494); Carolina Burrows and Colin M. Burrows (19-3501); Gwyneth A. Castaneda (19-3503); Margaret E. Coleman (19-3504); Norma Courage and Thomas G. Courage (19-3505); Terence Cranmer and Audrey Cranmer (19-3506); Edna J. Evans (19-3507); Diana C. Hedley and Malcolm S. Hedley (19-3508); Brian Hollowell and Lydia Hollowell (19-3510); Gay Searles (19-3511); William A. Stephenson and Christine Stephenson (19-3512); Jose A. Vinuales Villar (19-3513), Plaintiffs-Appellants, v. DePuy Orthopaedics, Inc.; DePuy Inc.; DePuy International Limited; Johnson & Johnson; Johnson & Johnson Services, Inc.; Johnson & Johnson International, Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

953 F.3d 890

IN RE: DEPUY ORTHOPAEDICS, INC. ASR HIP IMPLANT PRODUCTS LIABILITY LITIGATION.

Linda Boal and David Boal (19-3494); Carolina Burrows and Colin M. Burrows (19-3501); Gwyneth A. Castaneda (19-3503); Margaret E. Coleman (19-3504); Norma Courage and Thomas G. Courage (19-3505); Terence Cranmer and Audrey Cranmer (19-3506); Edna J. Evans (19-3507); Diana C. Hedley and Malcolm S. Hedley (19-3508); Brian Hollowell and Lydia Hollowell (19-3510); Gay Searles (19-3511); William A. Stephenson and Christine Stephenson (19-3512); Jose A. Vinuales Villar (19-3513), Plaintiffs-Appellants,

v.DePuy Orthopaedics, Inc.; DePuy Inc.; DePuy International Limited; Johnson & Johnson; Johnson & Johnson Services, Inc.; Johnson & Johnson International, Defendants-Appellees.

Nos. 19-3494/3501/3503/3504/3505/3506/

3507

3508

3510

3511

3512

3513

United States Court of Appeals, Sixth Circuit.

Argued: February 5, 2020

Decided and Filed: March 27, 2020

ARGUED: E. Aaron Sprague, CREED & GOWDY, P.A., Jacksonville, Florida, for Appellants. Benjamin C. Sassé, TUCKER ELLIS LLP, Cleveland, Ohio, for Appellees. ON BRIEF: Jeffrey L. Haberman, SCHLESINGER LAW OFFICES, P.A., Fort Lauderdale, Florida, for Appellants. Benjamin C. Sassé, Kristen L. Mayer, TUCKER ELLIS LLP, Cleveland, Ohio, for Appellees.

Before: BATCHELDER, LARSEN, and MURPHY, Circuit Judges.

MURPHY, Circuit Judge.

The twelve cases consolidated in this appeal serve as yet another reminder that it "behooves parties to be meticulous in jurisdictional matters." Prime Rate Premium Fin. Corp., Inc. v. Larson , 930 F.3d 759, 765 (6th Cir. 2019). "For some 200 years it has been the rule that—no matter the time and resources spent—an appellate court must wipe out everything that has occurred if the lower court lacked jurisdiction." Id. at 764–65. Here, even though nearly eight years have passed since the plaintiffs sued, all now recognize that the district court lacked diversity jurisdiction from the start. We thus vacate the district court’s judgments.

I

Since 2010, the District Court for the Northern District of Ohio has been the home of multidistrict litigation involving the DePuy ASR XL Acetabular Hip System, a medical device used in hip-replacement surgeries. Plaintiffs in this complex litigation have generally asserted that this device was defective and that the defendants gave inadequate warnings about its risks. At its peak, the multidistrict litigation contained over 8,500 cases with over 12,000 plaintiffs. Residents of the United States litigated most of these cases. In late 2013, the defendants entered into a broad settlement agreement with this group of plaintiffs. The district court has since implemented the agreement and appointed an administrator to process thousands of claims.

Foreign plaintiffs, by contrast, brought the twelve suits at issue in this appeal. In 2012, they filed "short-form" complaints in Ohio in the district court overseeing the multidistrict litigation, an approach permitted by one of the court’s general case-management orders. Each complaint alleged that a plaintiff had been implanted with the DePuy device during hip surgery in Spain. The spouses of several of these plaintiffs also joined the litigation. These plaintiffs sued the same six defendants: DePuy Orthopaedics, Inc.; DePuy, Inc.; DePuy International Limited; Johnson & Johnson; Johnson & Johnson Services, Inc.; and Johnson & Johnson International. The complaints did not identify the basis for the district court’s subject-matter jurisdiction, but the civil cover sheets listed diversity jurisdiction under 28 U.S.C. § 1332. The complaints also alleged that the plaintiffs who had been implanted with the DePuy devices were Spanish residents and either Spanish or British citizens. They did not identify the defendants’ citizenship.

In the district court, the defendants never disputed that diversity jurisdiction existed. Shortly after the suits were filed, they instead told the plaintiffs that they would move to dismiss the suits under the venue-like doctrine known as forum non conveniens (a Latin phrase meaning inconvenient forum). While the general multidistrict litigation progressed over the next several years, little happened in these specific suits. The plaintiffs simply provided some case-specific information as required by other case-management orders. In 2015, the defendants eventually followed through on their earlier notice by filing motions to dismiss based on forum non conveniens .

The district court granted the motions. It issued twelve similar opinions dismissing these cases because Spain provided the better forum. The court reasoned that the plaintiffs were residents of Spain; that their hip-replacement surgeries and follow-up care had occurred there; that the case-specific evidence was located there; and that Spanish law likely applied. It also found that Spanish courts provided an adequate forum for the plaintiffs and that the defendants had not waited too long in filing their motions. The court nevertheless conditioned its dismissal of these suits on the defendants’ submitting to the jurisdiction of a Spanish court, on their waiving any limitations defenses, and on their satisfying any final judgments for the plaintiffs. The plaintiffs appealed.

II

Before argument, we asked the parties whether the district court had diversity jurisdiction. The plaintiffs have since called this jurisdictional issue a "technicality," noting that "[t]his was the first time the issue of subject matter jurisdiction" had been raised. We think it worthwhile to remind litigants that "[a] federal court’s entertaining a case that is not within its subject matter jurisdiction is no mere technical violation[.]" 13 Charles Alan Wright et al., Federal Practice and Procedure § 3522, at 100–02 (3d ed. 2008). "Federal courts are not courts of general jurisdiction; they have only the power that is authorized by Article III of the Constitution and the statutes enacted by Congress pursuant thereto."

Bender v. Williamsport Area Sch. Dist. , 475 U.S. 534, 541, 106 S.Ct. 1326, 89 L.Ed.2d 501 (1986). No one would call Article I’s limits on Congress’s legislative power legal "technicalities." Likewise, "[m]uch more than legal niceties are at stake" when courts exceed their jurisdiction. Steel Co. v. Citizens for a Better Env’t , 523 U.S. 83, 101, 118 S.Ct. 1003, 140 L.Ed.2d 210 (1998). While the judiciary may be the "least dangerous" branch, The Federalist No. 78, at 464 (A. Hamilton) (Clinton Rossiter ed., 1961), it still has great power to affect people’s lives. This point is perhaps more readily apparent in cases involving far-reaching constitutional questions. See Hollingsworth v. Perry , 570 U.S. 693, 704–05, 133 S.Ct. 2652, 186 L.Ed.2d 768 (2013). But it has no less force in cases, like this one, where one party seeks to use government power to compel another party to give up its property. In any case, large or small, the exercise of the "judicial Power" by a court that has not been granted it "offends fundamental principles of separation of powers." Steel Co. , 523 U.S. at 94, 118 S.Ct. 1003. For that reason, federal courts must catch jurisdictional defects at all stages of a case, even when substantial resources have already been invested in it. Id. at 94–95, 118 S.Ct. 1003. Ordinarily, it is the plaintiff’s burden to demonstrate that the court has jurisdiction. Hence, the first thing—not the last—that any potential federal plaintiff should ask itself is whether a federal court would have jurisdiction over a federal suit.

This case proves why. After eight years the parties now concede that the district court lacked diversity jurisdiction all along. Rightly so. Two provisions in 28 U.S.C. § 1332(a) give district courts jurisdiction over civil actions that include foreign citizens and that seek more than $75,000. The first, § 1332(a)(2), grants jurisdiction over a civil action between "citizens of a State and citizens or subjects of a foreign state[.]" So if a Spanish citizen sued an Ohio citizen for more than $75,000, jurisdiction would exist under § 1332(a)(2). See 14A Charles Alan Wright et al., Federal Practice and Procedure § 3661, at 5 (2013) ; see also U.S. Const. art. III, § 2, cl. 1. The second, § 1332(a)(3), grants jurisdiction over a civil action between "citizens of different States" even when "citizens or subjects of a foreign state are additional parties[.]" So if an Ohio citizen sued both a Michigan citizen and a Spanish citizen for more than $75,000, jurisdiction would exist under § 1332(a)(3). Indeed, if citizens of different states are on both sides of a dispute, most courts hold that § 1332(a)(3) even permits foreign citizens to join as additional parties on both sides. See 14A Wright, supra , § 3661, at 13–14 & n.12; Tango Music, LLC v. DeadQuick Music, Inc. , 348 F.3d 244, 245 (7th Cir. 2003).

What happens, though, if foreign citizens are on both sides of a dispute but a state citizen is on only one side (say, a Spanish plaintiff sues defendants from Ohio and the United Kingdom)? This fact pattern does not fit § 1332(a)(3) because citizens of different states do not fall on both sides (as in the example involving an Ohio citizen suing a Michigan citizen and a Spanish citizen). And it does not fit § 1332(a)(2) because we have read that provision to require "complete" diversity—meaning that only state citizens are on one side of the dispute and only foreign citizens are on the other (as in the example involving a Spanish plaintiff suing an Ohio defendant). See U.S. Motors v. Gen. Motors Europe , 551 F.3d 420, 422–24 (6th Cir. 2008) ; Peninsula Asset Mgmt. (Cayman) Ltd. v. Hankook Tire Co. Ltd. , 509 F.3d 271, 272–73 (6th Cir. 2007). For what it is worth, the other circuit courts to have addressed this issue agree with our complete-diversity reading of § 1332(a)(2). See Caron v. NCL (Bahamas), Ltd. , 910 F.3d 1359, 1364 (11th Cir. 2018) (citing cases); 14A Wright, supra , § 3661, at 16–17. Section 1332(a) thus...