Diversity Jurisdiction Motion to Remand "Good Faith Intent to Prosecute"
In re Zoloft Products Liability Litigation, PICS Case No. 17-1111 (E.D. Pa. June 20, 2017) Rufe, J. (8 pages).
Court denied plaintiffs' motion to remand for lack of diversity in action alleging fraudulent concealment and failure to warn in drug birth defect case because the court found that the undiverse defendant was fraudulently joined since plaintiffs lacked a good-faith intent to prosecute their claims against that defendant. Motion denied.
Plaintiff, who was born with birth defects allegedly caused by a drug his pregnant mother took, sued several manufacturers alleging they aggressively marketed and sold the drug to pregnant women despite evidence that the drug increased the risk of birth defects without informing doctors or consumers of the risk. Plaintiffs filed the action in California, defendants removed the action to federal court based on diversity jurisdiction and the case was transferred to the present court as part of the Zoloft multidistrict litigation. Plaintiffs moved to remand the case to California for lack of diversity jurisdiction because defendant McKesson was a California corporation. Defendants contended that McKesson was fraudulently joined and that thus, complete diversity existed between the parties.
The court found that plaintiffs pled sufficient facts to assert a claim against McKesson but that the history of the Zoloft litigation showed that plaintiffs had no real intention to pursue claims against McKesson. McKesson, a Delaware corporation headquartered in California manufactured, packaged and distributed pharmaceutical company's products. Defendants contended that Zoloft plaintiffs, including others represented by plaintiffs' counsel, regularly failed to propound discovery on McKesson and often voluntarily dismissed McKesson as a named defendant. The court considered a similar situation in the Avandia MDL where the court found that after five years, plaintiffs had not sought discovery from McKesson and offered no good explanation as to why not and the court concluded that McKesson had been fraudulently joined. The circumstances in this case likewise showed on intent on the part of plaintiffs to pursue claims against McKesson. The court was aware of no instance in which any of the numerous Zoloft plaintiffs had propounded meaningful discovery on McKesson even though some of those cases had gone to trial.
The lack of discovery cast doubt on plaintiffs' intent to pursue claims against McKesson and plaintiffs in numerous Zoloft cases dismissed claims against McKesson both before and after the court granted summary judgment in favor of pharmaceutical company and another defendant. One of those cases was filed by plaintiffs' counsel.
The court found that plaintiffs lacked a good-faith intent to prosecute their claims against McKesson and thus, McKesson was fraudulently joined.