In re Norplant Contraceptive Products Liability Lit.

• Decision Date: 16 June 1995
• Docket Number: No. 1:95 CV 5068.,1:95 CV 5068.
• Citation: 889 F. Supp. 271
• Parties: In re NORPLANT CONTRACEPTIVE PRODUCTS LIABILITY LITIGATION. Dorother ALEXANDER, et al., Plaintiffs, v. WYETH LABORATORIES, INC., et al., Defendants.
• Court: U.S. District Court — Eastern District of Texas

889 F. Supp. 271

In re NORPLANT CONTRACEPTIVE PRODUCTS LIABILITY LITIGATION Dorother ALEXANDER, et al., Plaintiffs, v. WYETH LABORATORIES, INC., et al., Defendants.

No. 1:95 CV 5068.

United States District Court, E.D. Texas, Beaumont Division.

June 16, 1995.

T. Roe Frazer II of Langston, Frazer and Sweet, J.L. Chestnut, Jr of Chestnut, Sanders, Sanders & Pettaway and Frederick T. Kuykendall and Samuel H. Heldman of Cooper, Mitch, Crawford, Kuykendall and Whatley, for plaintiffs.

John W. Vardaman, F. Lane Heard III of Williams and Connolly, Paul Gertz and Larry Germer of Germer and Gertz, and Richard H. Gill of Copeland, Franco, Screws and Gill, for defendants.

MEMORANDUM OPINION AND ORDER GRANTING PLAINTIFFS' MOTION TO REMAND

SCHELL, Chief Judge.

Before this court is Plaintiffs' Motion to Remand, filed on April 14, 1995. A response, filed by defendants American Home Products Corporation and Wyeth Laboratories, Inc. ("Defendants"), was timely filed on April 28, 1995. Upon consideration of the motion, response, and attached memoranda, the court is of the opinion that the motion should be GRANTED.

BACKGROUND

Plaintiffs originally filed this suit in Alabama state court on November 8, 1994. In response, the Defendants removed this case to the United States District Court for the Northern District of Alabama on December 21, 1994.¹ The case was then transferred to this court by the Judicial Panel on Multidistrict Litigation for pretrial proceedings. Finally, the Plaintiffs filed their motion to remand this action back to state court.

FACTS

Plaintiffs' complaint alleges that the defendants in this case design, test, manufacture, sell, or distribute silicone-coated levonorgestrel contraceptive implants ("NORPLANT") or the component parts thereof, ultimately to be implanted in the bodies of women.² Plaintiffs seek to hold Defendants liable for both the side effects or adverse reactions allegedly caused by NORPLANT and the alleged difficulty of removing NORPLANT once it has been implanted.

Plaintiffs' Complaint contains four counts on behalf of all Plaintiffs.³ The claims are alleged against all defendants, with no defendant specifically included or excluded from any claim.

Plaintiffs brought this suit in Alabama state court because they have alleged no federal cause of action and because all Plaintiffs are Alabama residents, with two defendants — Walker Drug Company ("Walker") and Durr Drug Company ("Durr") — also alleged to be citizens of Alabama for purposes of determining whether diversity jurisdiction exists. However, Defendants removed this suit to federal court, claiming that diversity jurisdiction did exist since Plaintiffs never served Walker and so Walker should not be considered in determining whether diversity exists, while Durr had merged into a California corporation and was therefore no longer a citizen of Alabama for diversity jurisdiction purposes. Plaintiffs then moved to remand back to Alabama state court.

DISCUSSION

Plaintiffs argument in favor of remanding this case is twofold: (1) diversity jurisdiction does not exist because at least one of the defendants is a citizen of Alabama, the state of citizenship of the Plaintiffs; and (2) diversity jurisdiction does not exist because the individual claims of the Plaintiffs do not meet the jurisdictional minimum of $50,000 as required for diversity jurisdiction. Because this court holds that at least one of the Defendants is a citizen of Alabama, this order does not address whether the amount-incontroversy requirement for diversity jurisdiction is satisfied.

Before discussing the issue of diversity jurisdiction, this court must first consider the threshold matter of which Circuit's law is to be applied.⁴ The question of whether to apply the interpretation of 28 U.S.C. § 1441 given by the Fifth Circuit or by the Eleventh Circuit in a case transferred pursuant to 28 U.S.C. § 1407 is an issue which this court has very recently considered. In In re NORPLANT Contraceptive Prods. Liab. Litig., 878 F.Supp. 972 (E.D.Tex.1995), this court stated that "since federal removal and remand law is at issue, it is necessary that this court look first to Fifth Circuit law as a guide." Id. at 975. Additionally, this court held that "it is the law of the transferee court which applies" when a case is transferred pursuant to 28 U.S.C. § 1407. Id. n. 5. Therefore, looking primarily to Fifth Circuit precedent, this court must determine whether an unserved resident defendant is to be considered in determining whether diversity of jurisdiction exists.

The United States Supreme Court has held that the citizenship of all defendants, whether served with process or not, is to be considered when determining whether complete diversity exists in a removed lawsuit. Pullman Co. v. Jenkins, 305 U.S. 534, 541, 59 S.Ct. 347, 350, 83 L.Ed. 334 (1939). Following the decision in Pullman, Congress amended the removal statute so that it now provides that an action in which there is complete diversity of parties "shall be removable only if none of the parties in interest properly joined and served as defendants is a citizen of the State in which the action is brought." 28 U.S.C. § 1441(b). Defendants argue that this language was enacted to change the result in cases like Pullman, and they cite several cases in support of their argument that resident defendants who have not been served may be ignored in determining whether complete diversity exists. However, upon review of these cases, this court finds that only one, Mask v. Chrysler Corp., 825 F.Supp. 285 (N.D.Ala.1993), aff'd without opinion, 29 F.3d 641 (11th Cir.1994), offers some support to the argument which the Defendants make to avoid remand of this case. Further, this court finds that the overwhelming majority of reported cases are of the opposing view and support remanding this case.

As a preliminary matter, this court examined each of the cases upon which the Defendants relied. First, Defendants cite Mask, 825 F.Supp. 285. In that case, the district court found that the defendant had been fraudulently joined and could therefore be ignored in determining whether complete diversity existed between the parties. Id. at 289. Alternatively, the court also found that the plaintiff's failure to serve the defendant also provided grounds for ignoring the citizenship of the defendant in determining removability based on diversity of citizenship. Id. In reaching this decision, the court stated that the courts are divided on the issue of whether to ignore the citizenship of unserved defendants, citing several cases. However, one of the cases which the court cited in support of its view that the citizenship of resident defendants who have not been served may be completely ignored in determining removability explicitly states that "the presence of unserved resident defendants does not defeat removal when complete diversity exists." Wensil v. E.I. Dupont De Nemours and Co., 792 F.Supp. 447, 449 (D.S.C.1992) (quoted in Mask, 825 F.Supp. at 289) (emphasis added).⁵ From the above-quoted passage it is apparent that the court has identified a two-step test for removal of a case under 28 U.S.C. § 1441⁶ when jurisdiction is based upon diversity— (1) the parties must be completely diverse, and (2) the named and served defendants cannot be residents of the state in which the suit is brought. Further, Wensil explicitly states that "section 1441(b) is not being used to expand diversity jurisdiction." Wensil, 792 F.Supp. at 448. It is the two-step process identified in Wensil which the court in Mask fails to recognize. In fact, the reasoning of the Mask opinion has been criticized on this very point by its sister court in the Southern District of Alabama in Beritiech v. Metropolitan Life Ins. Co., 881 F.Supp. 557 (S.D.Ala.1995). In Beritiech, the court found that the Northern District of Alabama's interpretation of § 1441(b) in Mask to be wrong, stating:

Only when the district court has original jurisdiction will the provisions of Section 1441(b) become operative. In other words, the provision in Section 1441(b) does not qualify the requirement of Section 1441(a) that there must be complete diversity between the named opposing parties; it merely adds the requirement in removal cases based on diversity that the joined and served defendants cannot include one from the state in which the action is brought. Section 1441(b) therefore did not change the removal requirement set forth in Pullman that a court, in determining the propriety of removal based on diversity of citizenship, must consider all named defendants regardless of service.

Beritiech, 881 F.Supp. at 560 (citations omitted).

Defendants next cite Republic Western Ins. v. International Ins., 765 F.Supp. 628 (N.D.Cal.1991), in support of their argument. However, the district court in this case specifically distinguished Pullman and its progeny on the fact that in Pullman the presence of the unserved defendant would destroy diversity, whereas in Republic Western complete diversity between the parties existed even considering the citizenship of the unserved defendant. Republic Western, 765 F.Supp. at 629. This same distinction makes Republic Western inapposite to the case at bar.

Defendants also cite Windac Corp. v. Clarke, 530 F.Supp. 812 (D.Neb.1982), in support of their argument. Again, this case rests its holding on the second step in the previously set-out process — the named and served defendants cannot be residents of the state in which the suit is brought. Id. at 812-813. The court only addressed this point because complete diversity existed between the parties, served or unserved, unlike in the case at bar. Therefore, this case also does not support the Defendants' argument that unserved defendants should be disregarded in determining whether there is complete diversity.

Further, the Defendants cite Duff v. Aetna Casualty and Sur. Co., 287 F.Supp. 138 (N.D.Okl.1968) in support...