Virden v. Altria Group, Inc.

• Decision Date: 30 January 2004
• Docket Number: No. CIV.A.5:03 CV 61.,CIV.A.5:03 CV 61.
• Parties: Donald VIRDEN, on behalf of himself and others similarly situated, Plaintiff, v. ALTRIA GROUP, INC. and PHILIP MORRIS USA, Defendants.
• Court: U.S. District Court — Northern District of West Virginia

304 F.Supp.2d 832

Donald VIRDEN, on behalf of himself and others similarly situated, Plaintiff, v. ALTRIA GROUP, INC. and PHILIP MORRIS USA, Defendants.

No. CIV.A.5:03 CV 61.

United States District Court, N.D. West Virginia.

January 30, 2004.

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Mark T. Coulter, Peirce, Raimond, Osterhout, Wade, Carlson & Coulter, PC, D. Aaron Rihn, Peirce, Raimond, Osterhout, Pittsburgh, PA, for plaintiff.

Brian A. Glasser, Bailey & Glasser, LLP, David B. Thomas, Rebecca A. Betts, Philip J. Combs, Allen, Guthrie, McHugh & Thomas, PLLC, Charleston, WV, Ezra D. Rosenberg, Dechert LLP, Princeton, NJ, for defendants.

MEMORANDUM OPINION AND ORDER OF REMAND

KEELEY, Chief Judge.

I. PROCEDURAL BACKGROUND

On March 28, 2003, plaintiff Donald Virden ("Virden") filed this action in the Circuit Court of Hancock County, West Virginia, seeking relief on behalf of himself and "all others similarly situated." The first defendant to be served in the state court action received its copy of the complaint on April 3, 2003. Both defendants then removed this action to this Court on May 2, 2003. On June 3, 2003, Virden filed a motion to remand this action to state court. The Court has heard oral argument and, for the reasons that follow, GRANTS Virden's motion to remand.

II. FACTUAL BACKGROUND

This is a purported consumer fraud class action allegedly arising under the West Virginia Consumer Credit and Protection Act, W. Va.Code § 46A-6-101 et seq. ("WVCCPA") and under the common law doctrine of unjust enrichment. Virden is a resident of New Cumberland, West Virginia. He alleges that he purchased and consumed on average approximately two and a half packs of Marlboro Lights cigarettes per day for approximately twenty years, and is seeking damages on behalf of himself and others similarly situated.

Defendant Altria Group, Inc. ("Altria") and its wholly owned subsidiary, Phillip Morris USA ("PM"), are Virginia corporations whose principal places of business are in New York City. During all times relevant to this action, these defendants manufactured, promoted, marketed, distributed and sold Marlboro Lights brand cigarettes in interstate commerce and in West Virginia.

Virden alleges that the defendants deceived purchasers of Marlboro Lights by: (a) falsely or deceptively claiming that Marlboro Lights had lower tar and nicotine content than regular cigarettes; (b) failing to disclose the fact that measurements purporting to reflect reduced tar and nicotine levels were not the product of "benign changes" in tar and nicotine levels but were based on changes in cigarette design and composition; (c) failing to disclose that defendants "intentionally manipulated the design and content of Marlboro Lights in order to maximize nicotine delivery while falsely and/or deceptively claiming lowered tar and nicotine;" (d) failing to disclose that defendants engineered their cigarettes to "fool the machine tests that Defendants use as a basis to market their cigarettes as `lights';" and (e) failing to disclose that the techniques employed by defendants to purportedly reduce the levels of tar "actually increase the harmful biological effects ... caused by the tar ingested to the consumer."

The defendants assert that federal jurisdiction exists based on one or more of the following grounds: (1) federal question jurisdiction under 28 U.S.C. §§ 1331 and 1441; (2) federal officer jurisdiction under 28 U.S.C. § 1442(a)(1); and (3) diversity jurisdiction under 28 U.S.C. §§ 1332 and 1441.

III. LEGAL STANDARD FOR MOTION TO REMAND

"Typically, an action initiated in a state court can be removed to federal court only if it might have been brought in federal court originally." Sonoco Prods. Co. v. Physicians Health Plan, Inc., 338 F.3d 366, 370 (4th Cir.2003). Courts construe removal statutes narrowly. Schlumberger Indus., Inc. v. Nat'l Sur. Corp., 36 F.3d 1274, 1284 (4th Cir.1994). The party seeking removal bears the burden of showing that the district court has original jurisdiction. Mulcahey v. Columbia Organic Chems. Co., 29 F.3d 148, 151 (4th Cir.1994). "[C]ourts should resolve all doubts about the propriety of removal in favor of retained state court jurisdiction." Hartley v. CSX Transp., Inc., 187 F.3d 422, 425 (4th Cir.1999).

IV. SUBSTANTIAL FEDERAL QUESTION JURISDICTION

The defendants claim that removal is appropriate because Virden's claims arise under federal law. Title 28, United States Code, Section 1331, provides that "district courts shall have original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States."

To determine whether federal question jurisdiction exists, a court looks first to the well-pleaded complaint rule. That rule provides that, ordinarily, the court has "arising under" jurisdiction only if the plaintiff's well-pleaded complaint raises an issue of federal law. Franchise Tax Bd. of Cal. v. Constr. Laborers Vacation Trust for S. Cal., 463 U.S. 1, 10-11, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983). The rule allows the plaintiff to be the "master of the claim" and "avoid federal jurisdiction by exclusive reliance on state law." Caterpillar Inc. v. Williams, 482 U.S. 386, 392, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987).

An exception to the well-pleaded complaint rule arises when the plaintiff's complaint raises a substantial question of federal law, regardless of the manner in which the plaintiff has pled his or her claim. See Mulcahey, 29 F.3d at 151. Although state law creates a plaintiff's cause of action, federal question jurisdiction may nonetheless attach if "plaintiff's demand necessarily depends on resolution of a substantial question of federal law." Id. (citing Franchise Tax Bd., 463 U.S. at 28, 103 S.Ct. 2841) (emphasis in original).

Federal jurisdiction is not justified merely because the state court may be required to resolve questions of federal law: "[F]ederal law must be in the forefront of the case and not collateral, peripheral or remote." Id. at 152. For federal law to be at the "forefront" of the case, "a right or immunity created by the Constitution or laws of the United States must be an element, and an essential one, of the plaintiff's cause of action." Franchise Tax Bd., 463 U.S. at 11, 103 S.Ct. 2841 (citing Gully v. First Nat'l Bank, 299 U.S. 109, 112, 57 S.Ct. 96, 81 L.Ed. 70 (1936)).

The defendants contend that Virden's claims have been artfully pled to avoid federal jurisdiction despite the fact that the real nature of his claims is federal. Under the artful pleading doctrine invoked by the defendants, the removal court must "determine whether the real nature of the claim is federal, regardless of plaintiff's characterization." Federated Dep't Stores, Inc. v. Moitie, 452 U.S. 394, 398 n. 2, 101 S.Ct. 2424, 69 L.Ed.2d 103 (1981).

Despite its availability, the artful pleading doctrine must be applied with circumspection. "An expansive application of the doctrine could effectively abrogate the rule that a plaintiff is master of his or her complaint." Semtek Int'l, Inc. v. Lockheed Martin Corp., 988 F.Supp. 913, 916 (D.Md.1997) (quoting United Jersey Banks v. Parell, 783 F.2d 360, 368 (3d Cir.1986)).

The defendants assert that Virden's complaint necessarily requires the resolution of a substantial question of federal law, which is the validity of the federal regulatory regimen governing the testing and labeling of "light" cigarettes. To evaluate this claim, the Court must first determine the nature of the regulatory regimen in place and whether Virden's complaint will require a decision that would interfere with that regimen.

A. BRIEF REVIEW OF FEDERAL REGULATION OF "LIGHT" CIGARETTES

The Federal Trade Commission ("FTC") first became involved in the regulation of tar and nicotine claims by cigarette companies in the mid-1950s. In September 1955, it published cigarette advertising guides which, among other things, informed the tobacco companies that they could make representations regarding tar and nicotine levels only if they had "established by competent scientific proof at the time of dissemination that the claim is true." Cigarette Advertising Guides, Trade Reg. Rptr. ¶ 39,012 at 41,602 (Sept. 22, 1955) (CCH 1955). The FTC grew dissatisfied with this regimen, however, when disparate testing methods led to consumer confusion. Thus, in 1959, it directed the tobacco companies to stop advertising that their cigarettes had "low or reduced tar." Letter from W.H. Brain to A. Yeaman (Dec. 17, 1959).

In the mid-1960s, the FTC sought to establish a system that would allow the cigarette industry to inform consumers of tar and nicotine levels and also ensure that the disclosed figures were standardized across brands. In a March 25, 1966 letter sent by the agency to each of the nation's major cigarette manufacturers, the FTC stated that "a factual statement of the tar and nicotine content" would not violate federal trade laws "so long as (1) no collateral representations ... are made, expressly or by implication, as to the reduction or elimination of health hazards, and (2) the statement of tar and nicotine content is supported by adequate records of tests conducted in accordance with the Cambridge Filter Method ...." FTC News Release (Mar. 25.1966).

In 1967, the FTC began testing cigarettes at its own laboratory, using a modified version of the Cambridge Filter Method (otherwise known as the "FTC Method"). Significantly, when it adopted the modified Cambridge Filter or "FTC Method", the FTC noted that this method was not necessarily "better" than other methods, but rather that it served the public interest to implement a uniform cigarette testing method at a centralized, neutral laboratory. FTC Press Release, "FTC To Begin Cigarette Testing" (Aug. 1, 1967). The FTC further noted that, because "[n]o two human smokers smoke in the same way," the "FTC Method" was not an attempt "to gauge the test to...