On Tuesday, six alleged victims of the notorious anti-nausea
drug thalidomide filed a complaint in Philadelphia's Court of
Common Pleas against GlaxoSmithKline, Sanofi-Aventis, Grunenthal
and other defendants, asserting that decades ago their mothers
took the drug during pregnancy, unaware that it could cause
grievous birth defects. Like other alleged thalidomide victims
who filed similar cases last year, these plaintiffs claim
recently uncovered evidence has revealed that thalidomide was
widely prescribed in the United States, where it was only
supposed to have been available through a clinical trial.
It's not a coincidence that this case, like the other
thalidomide suits, was brought in the Court of Common Pleas,
which has a reputation (deserved or not) of being an extremely plaintiff-friendly jurisdiction. Pharmaceutical companies, in
particular, have groused for years about the supposedly
anti-defense bent of the court's mass torts division, which has
become a magnet for state-law product liability claims. The
lawyers who have filed thalidomide cases -- Hagens Berman Sobol
Shapiro, the Lanier Law Firm, Gordon & Reeves and Spector,
Roseman, Kodroff & Willis -- assert that at least four of the
defendants are corporate citizens of Pennsylvania, subject to
suit for state-law claims in the Court of Common Pleas.
It will probably not surprise you to hear that the
defendants have removed four previously filed thalidomide suits
to federal court in Philadelphia, since product liability
defendants almost always prefer federal court to state court.
But that's where things get interesting in the thalidomide
litigation. On the same day last March, three federal judges
split on the question of whether to remand the cases back to
U.S. District Judges Darnell Jones and Joel Slomsky said the
cases should go back to the Court of Common Pleas. Slomsky ruled
that the nerve center of GlaxoSmithKlein is in Pennsylvania, so
under the U.S. Supreme Court's 2010 ruling in Hertz v. Friend,
Glaxo is a Pennsylvania citizen. The case he was considering
involved Pennsylvania plaintiffs, so, Slomsky said, there's no
federal-court diversity jurisdiction to keep the litigation in
federal court. There aren't Pennsylvania plaintiffs in the case
before Jones, but he also found that Glaxo is a Pennsylvania
citizen. Jones cited the forum defendant rule (which holds that
a case can be remanded if at least one defendant is a citizen of
the state in whose courts it was filed) and the "well
established precept that the court shall resolve any doubt in
favor of remand," and sent the suit back to state court.
In a third thalidomide case, however, U.S. District Judge
Paul Diamondfound that none of the defendants is a Pennsylvania
citizen. Bucking the reasoning not only of Jones and Slomsky but
also of two other Philadelphia federal-court judges who have
found Glaxo to be a corporate citizen of their state (in
non-thalidomide cases), Diamond said Glaxo's holding company is
based in Delaware, so its limited liability operating companies
must be construed as Delaware citizens. To hold otherwise, he
said, would contravene the Supreme Court's intention in Hertz.
Diamond said that he has diversity jurisdiction and denied the
plaintiffs' motion to remand.
All three judges agreed that this was a question the 3rd
Circuit Court of Appeals would have to resolve. All certified
the issue for an interlocutory appeal. The 3rd Circuit has set a
single briefing schedule on the jurisdiction issue in which the
thalidomide plaintiffs, who appealed Diamond's order, must file
their opening brief next Monday. The defendants then have 30
days to file a response.
The briefs promise to be ultra-technical dissections of the
Supreme Court's directives in Hertz and the interplay between
diversity jurisdiction and the forum defendant rule, a far cry
from the plaintiffs' allegations of a coverup that led to their
gut-wrenching birth defects. But the 3rd Circuit's ultimate
determination of the proper forum for the thalidomide litigation
could go a long way to deciding the value of the plaintiffs'
Glaxo counsel Michael Scott of Reed Smith declined to
comment. (Other defendants are represented by Dechert, Arnold &
Porter and Sidley Austin.) I contacted a Hagens Berman spokesman
but didn't hear back from lawyers at the firm.
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