Moore v. Johnson & Johnson

• Decision Date: 01 November 2012
• Docket Number: Civil Action No. 12–490.
• Citation: 907 F.Supp.2d 646
• Parties: Daniel MOORE, et al., v. JOHNSON & JOHNSON, et al.
• Court: U.S. District Court — Eastern District of Pennsylvania

907 F.Supp.2d 646

Daniel MOORE, et al.,

v.JOHNSON & JOHNSON, et al.

Civil Action No. 12–490.

United States District Court, E.D. Pennsylvania.

Nov. 1, 2012.

Irene M. McLafferty, Joseph L. Messa, Jr., Thomas N. Sweeney, Messa & Associates PC, Philadelphia, PA, for Plaintiffs.

Christy D. Jones, Butler, Snow, O'Mara Stevens & Cannada PLLC, Ridgeland, MS, David F. Abernethy, Melissa A. Graff, Drinker Biddle & Reath LLP, David Newmann, Stephen A. Loney, Jr., Hogan & Hartson L.L.P., Frank R. Emmerich, Jr., Conrad O'Brien, Philadelphia, PA, Michael B. Hewes, Butler Snow O'Mara Stevens & Cannada PLLC, Gulfport, MS, Sarah Elizabeth Moccaldi, Butler Snow, Memphis, TN, Michael L. Kidney, Hogan Lovelis U.S. LLP, Washington, DC, Angel A. Garganta, Beth H. Parker, Jeremy M. McLaughlin, Jonathan L. Koenig, Arnold & Porter LLP, San Francisco, CA, for Defendants.

MEMORANDUM

McLAUGHLIN, District Judge.

This personal injury and wrongful death action arises out of injuries allegedly suffered by the plaintiffs' son after he ingested a dose of the over-the-counter medication, Children's Tylenol. The Children's Tylenol was produced by McNEIL–PPC, Inc. (“McNEIL–PPC”) at its Fort Washington, Pennsylvania production facility. The plaintiffs allege that their son's injuries and eventual death are directly attributable to quality control problems and defective production at the Fort Washington plant.

On December 29, 2011, the plaintiffs, Daniel and Katy Moore, filed suit in the Pennsylvania Court of Common Pleas against seventeen defendants, asserting twelve separate claims all stemming from the death of their son, River. Among those named as defendants in the Moores' lawsuit are McNEIL–PPC, McNEIL–PPC's ultimate parent corporation, Johnson & Johnson (“J & J”), and J & J executives William C. Weldon (“Weldon”) and Rosemary Crane (“Crane”), as well as Costco Wholesale Corporation (“Costco”), the corporate owner of the store that sold Ms. Moore the purportedly defective bottle of Children's Tylenol. ¹

Several of the defendants, including J & J, McNEIL–PPC, Costco, and Weldon, jointly filed a notice of removal to this Court on January 30, 2012, to which other defendants consented. Crane neither joined in nor consented to the notice of removal. Removal was premised on this Court's diversity jurisdiction under 28 U.S.C. § 1332.

On February 14, 2012, the plaintiffs moved to remand the case to the Court of Common Pleas of Philadelphia County. The plaintiffs argue that removal is improper for several reasons: (1) McNEIL–PPC is a citizen of Pennsylvania and, under the “forum defendant” rule, is barred from removing a Pennsylvania state court action to a federal court sitting in that state; (2) Weldon and Crane are also citizens of Pennsylvania, similarly preventing removal under the “forum defendant” rule; (3) Costco, like the plaintiffs, is a citizen of Washington, defeating complete diversity among the parties; and (4) because Crane did not join in or consent to removing this case, the defendants have failed to comply with the requirement that consent to removal be unanimous among defendants.

The defendants contend that removal is proper and argue that (1) McNEIL–PPC is actually a citizen of New Jersey and may remove a Pennsylvania state court action to this Court; (2) forum defendants Weldon and Crane were fraudulently joined and their citizenship should not be considered for removal purposes; (3) Costco was fraudulently joined and its non-diverse citizenship does not deny this Court subject matter jurisdiction; and (4) Crane's consent to removal was unnecessary, either because she was fraudulently joined or because she had not been properly served with the summons and complaint when the removing defendants filed their notice of removal.

The Court will deny the plaintiffs' motion to remand.

I. Factual Background

The facts herein discussed are those necessary to determine the citizenship of McNEIL–PPC and the sufficiency of the plaintiffs' claims against Weldon, Crane, and Costco on a fraudulent joinder inquiry. The facts relevant to McNEIL–PPC's citizenship are drawn from unchallenged affidavits, deposition testimony, and exhibits submitted by the parties and constitute the factual findings of the Court. Any factual disputes are noted. Other facts are drawn from the assertions in the plaintiffs' verified complaint, which the Court must assume to be true when conducting a fraudulent joinder analysis. In re Briscoe, 448 F.3d 201, 217 (3d Cir.2006).

A. McNEIL–PPC's Activities and Corporate Structure

McNEIL–PPC is a wholly-owned subsidiary of J & J.² It is one of several J & J subsidiaries that make and sell a number of consumer products. The McNeil Consumer Healthcare Division of McNEIL–PPC makes and distributes over-the-counter (“OTC”) medications, such as Tylenol, Motrin, and Benadryl, and operates out of a facility in Fort Washington, Pennsylvania. McNEIL–PPC's other divisions and business units produce and distribute a variety of other products, such as Listerine mouthwash, Reach dental products, feminine hygiene products bearing the OB, Stayfree, and Carefree labels, and Rogaine. Corporate executives who manage these non-OTC brands are based in Skillman, New Jersey. Individuals working at J & J's Morris Plains, New Jersey campus also perform work related to some of these consumer products. Vaswani Supp. Decl. ¶¶ 3, 5; 5/8/12 Vaswani Dep. 52–53, 55–56, 68.

McNEIL–PPC has 40 officers. Thirty of those officers are located at corporate facilities in New Jersey: 23 are at J & J offices in New Brunswick, and the rest work out of Skillman and Morris Plains.³ Three of McNEIL–PPC's highest-ranking officers are based at its Fort Washington facility: President Denice Torres; Vice President/Chief Financial Officer Kirk Barton; and Secretary Shane Freedman. The office location of McNEIL–PPC's fourth senior officer, Treasurer Gregory Herlan, is unclear. His office is either in Skillman, New Jersey or Fort Washington, Pennsylvania.⁴ Vaswani Decl. ¶ 6; 5/2/12 Vaswani Dep. 65–66, 72–76; 5/8/12 Vaswani Dep. 43–44.

McNEIL–PPC's bylaws vest Denice Torres, as president, with “general charge and supervision of the business of the Corporation.” Pls.' 5/21/12 Supp. Br., Ex. C. Torres also serves as president of the McNeil Consumer Healthcare Division. Her actual management responsibilities are limited to that division. She directs and coordinates activities, such as marketing, only with respect to the OTC products manufactured by McNeil Consumer Healthcare. As a practical matter, McNEIL–PPC's vice president/CFO, Kirk Barton, also only manages the brands within the McNeil Consumer Healthcare Division. 5/2/12 Vaswani Dep. 71, 89–91; 5/8/12 Vaswani Dep. 60.

The bulk of the management functions for McNEIL–PPC and other J & J subsidiaries that produce consumer products are carried out by executives associated with J & J's Family of Consumer Companies (“FCC”), an operating group consisting of J & J's consumer businesses. The FCC is overseen by a Group Operating Committee (“GOC”) that exercises high-level direction for the corporate entities within the sector. Roberto Marques, who sits on the GOC as company group chairman of the FCC in North America, has “overall responsibility for the consumer business in North America.” Marques' office is in Skillman, New Jersey. J & J's internal directory states that Torres reports to Marques. 5/2/12 Vaswani Dep. 103–06, 138–41; 5/8/12 Vaswani Dep. 76–77; Vaswani Supp. Decl. ¶¶ 6, 8; Pls.' 5/21/12 Supp. Br., Ex. A.

Several other senior managers within the FCC, working from offices in Skillman, assist with the coordination and oversight of various aspects of J & J's consumer businesses. These executives, Roberto DiBernardini, Caitlin Pappas, and Larry Montes, are in charge of human resources, sales, and compliance, respectively, for the FCC in North America. A fourth, GregoryHerlan, directs and oversees the financial operations of the consumer businesses. As previously noted, the location of Herlan's office is uncertain. These four executives meet regularly with North American Company Group Chairman Roberto Marques in Skillman. With the exception of Herlan, who is McNEIL–PPC's treasurer, none of the senior executives running operations for the FCC are officers of McNEIL–PPC, nor are they employees of that particular corporation. They are employed by other J & J entities. 5/2/12 Vaswani Dep. 103–06, 112–15; 5/8/12 Vaswani Dep. 75; Vaswani Supp. Decl. ¶¶ 6, 8–12; Pls.' 5/21/12 Supp. Br., Ex. A.

B. McNEIL–PPC's Production of OTC Products⁵

J & J and McNEIL–PPC have a history of quality control problems dating back at least ten years. Beginning in 2002, J & J management undertook cost-cutting measures in quality control and production oversight to enhance corporate profits. J & J terminated experienced quality control staff and replaced them with inexperienced contract workers. These cost-cutting measures led to lax oversight of production at J & J's facilities, including those run by McNEIL–PPC. Compl. ¶¶ 63–66, 73.

Quality control issues at McNEIL–PPC facilities also resulted in the Food and Drug Administration (“FDA”) issuing reports critical of the company. For instance, in 2004, the FDA issued a report citing McNEIL–PPC's failure to conduct complete investigations and to maintain proper sampling practices and recordkeeping. Successive FDA reports in 2008 and 2009 also described problems with McNEIL–PPC's investigatory practices. On April 30, 2010, the FDA reported twenty “observations” of deficiencies in quality control and production operations at McNEIL–PPC's Fort Washington facility. Compl. ¶¶ 67, 78–79, 153–58.

On April 30, 2010, McNEIL–PPC also issued a recall of approximately 40 types of children's and infant liquid medications, including Tylenol, due to “filth and contamination” at the Fort Washington, Pennsylvania production facility. The recalled medication had “particulate contamination,” and some of the...