Seventh Circuit Shoves the S.D.Ill. Back Into Line On Removal

by Dechert LLP
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We've remarked before about the odd, detrimental position that the Southern District of Illinois has taken towards removal, fraudulent joinder, and diversity jurisdiction in cases claiming that pharmacies should be liable for prescription drugs just like any other intermediate product seller. The Illinois Supreme Court, as a substantive matter, has rejected pharmacy liability repeatedly as a consequence of the learned intermediary rule. See Happel v. Wal-Mart Stores, Inc., 766 N.E.2d 1118, 1127 (Ill. 2002); Frye v. Medicare-Glaser Corp., 605 N.E.2d 557, 559-61 (Ill. 1992); Kirk v. Michael Reese Hospital & Medical Center, 513 N.E.2d 387, 392 (Ill. 1987). Yet plaintiffs in the South Illinois "hellhole" counties, Madison, St. Clair, etc., kept alleging pharmacy liability, and numerous Southern District of Illinois decisions let them get away with it - remanding the cases based upon a combination of a "presumption" in favor of remand, and something called the "common defense" exception. Funny, but that didn't stop federal district courts in other parts of the country from finding fraudulent joinder where (as in most states) pharmacy liability was similarly barred under the relevant state's law.

Well, we think that's come to an end. As we also discussed before, with the Yazmin/Yaz litigation, the S.D. Ill. got its own MDL. Where a judge stands apparently depends somewhat on where s/he sits, and in that litigation, the court broke ranks and - rather than tolerate a large number of similar state-court suits trenching on the MDL - held that, contrary to a lot of other S.D. Ill. precedent - pharmacy liability claims constituted fraudlent joinder, and denied remand.

MDLs are a little different from individual litigation in other ways, too. For one thing, plaintiffs lawyers have lots and lots of "clients" and are not adverse to using them as cannon fodder when they want to make a legal point - or at least try to. That's what happened in Yazmin/Yaz. Counsel for one of the non-remanded plaintiffs, named Walton, decided to risk tanking the client's claim in order to appeal the failure to remand. So poor Ms. Walton defaulted on discovery obligations, the MDL court dismissed her case with prejudice as a sanction, and the plaintiff's lawyer challenged the dismissal for lack of federal subject matter litigation.

Yeah, a plaintiff can do that.

But the plaintiff had better be right, because if s/he loses the appeal - no more case.

Please see full article below for more information.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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