Kerchen v. Univ. of Mich.

100 F.4th 751

Heather KERCHEN; Lori Kerchen; Dale Kerchen, Plaintiffs-Appellees, v. UNIVERSITY OF MICHIGAN; James H. Woods, Defendants-Appellants,Christian Raphalides; [Unknown] Does, Defendants.

No. 23-1718

United States Court of Appeals, Sixth Circuit

Argued: March 19, 2024

Decided and Filed: May 6, 2024

Appeal from the United States District Court for the Eastern District of Michigan at Flint. No. 4:22-cv-12492—Shalina D. Kumar, District Judge.

ARGUED: Brian M. Schwartz, MILLER CANFIELD, PADDOCK AND STONE, P.L.C., Detroit, Michigan, for Appellants. Dustyn K. Coontz, COONTZ LAW, Lansing, Michigan, for Appellees. ON BRIEF: Brian M. Schwartz, Lawrence T. Garcia, Sydney G. Rohlicek, MILLER CANFIELD, PADDOCK AND STONE, P.L.C., Detroit, Michigan, for Appellants. Dustyn K. Coontz, COONTZ LAW, Lansing, Michigan, William B. Norman, DEFENDING OHIO, Berea, Ohio, for Appellees. Kyla L. Barranco. OFFICE OF THE MICHIGAN ATTORNEY GENERAL, Lansing, Michigan, for Amicus Curiae.

Before: COLE, CLAY, and BLOOMEKATZ, Circuit Judges.

OPINION

CLAY, Circuit Judge.

Plaintiffs Heather, Lori, and Dale Kerchen filed a complaint against Defendants the University of Michigan and Dr. James Woods, alleging violations under 42 U.S.C. § 1983 and Michigan state law. Defendants appeal the district court's order denying their motion to dismiss without prejudice and ordering limited discovery on whether this action is barred by the statutes of limitations applicable to Plaintiffs' claims. For the reasons stated below, we REVERSE the district court's denial of Defendants' motion to dismiss, DISMISS various claims for lack of jurisdiction as specified below, and REMAND for proceedings consistent with this opinion.

I. BACKGROUND

A. Factual Background

On January 25, 2000, police found Todd Kerchen ("Todd")¹ dead in his home. The night before Todd's death, he and his girlfriend had snorted a white powder, which Todd's girlfriend in later interviews referred to as either "Crystal China," "White China," or "China White." Compl., R. 1, Page ID #6, 10-11. Todd's autopsy revealed that he had ingested a lethal dose of fentanyl the night he died.

The Washtenaw County Sheriff's Department ("WCSD") investigated Todd's death. Todd's girlfriend told WCSD detectives that Todd had likely gotten the drugs that he used the night he died from Christian Raphalides. The complaint alleges that Raphalides provided the same "China White" drug to a student at the University of Michigan in September 1998, more than a year before Todd's death. That student also died from an overdose, although the police investigating the student's death reported that he had overdosed on cocaine, not fentanyl. Although the City of Ann Arbor Police Department investigated Raphalides in connection with this earlier death, the Washtenaw prosecutors declined to charge Raphalides.

The complaint alleges that Raphalides obtained the fentanyl that killed Todd from a University of Michigan pharmacology lab where Raphalides worked until November 1999. This lab tested the effects of controlled substances on animals. At the lab, Raphalides had access to multiple controlled substances, including fentanyl in powder form. Throughout Raphalides' employment, Defendant Dr. James Woods led and oversaw the lab.

WCSD detectives interviewed Woods twice in connection with the investigation into Todd's death. In those interviews, Woods gave the detectives a detailed account of how the lab distributed and monitored the controlled substances it used. The lab kept thousands of different types of controlled substances on hand. These substances were kept in a locked safe for 22 hours each day. For two hours a day—one hour in the morning and one hour in the afternoon—employees could remove the drugs they needed for their work from the unlocked safe. Employees weighed the amount of drugs that they needed and wrote down the type and quantity of the drugs that they removed. "Ordinarily," Woods or his assistant would oversee these hour-long processes, "[b]ut not always." Id. at Page ID #20.

In interviews with WCSD detectives concerning Todd's death, Woods acknowledged that it would be "common" for employees to keep controlled substances in their lockers at the lab. Id. Indeed, Woods led the detectives to Raphalides' locker, where they discovered 28 vials of PCP, morphine, and other drugs. No one had opened the locker since Raphalides left the lab almost four months earlier. The complaint also describes certain policies that the lab failed to implement to safely manage the distribution of controlled substances. For example, the complaint alleges that the lab did not take a regular inventory of the drugs removed from the safe, and did not have a procedure in place to reconcile the amount of drugs removed from the safe with the type and quantity of drugs used in procedures in the lab.

The complaint further alleges multiple facts supporting the conclusion that the fentanyl that killed Todd came from the University of Michigan lab. For example, it alleges that the glass vial containing white powder found on Todd's coffee table after his death resembled the glass vials containing drugs used by the lab. Specifically, all the vials had a rubber stopper with an aluminum clasp over the stopper. When WCSD detectives showed Woods a photo of the glass vial found on Todd's coffee table, he confirmed that the vial was "exactly" the same as one they would use in the lab. Id. at Page ID #18.

To be sure, Woods also told the detectives that these types of glass vials would be common in any research lab. However, the complaint alleges that specific labeling on the vial found at Todd's home further indicated that the fentanyl that killed him came from the University of Michigan lab. The lab employed a unique labeling procedure whereby employees would write the drug name, the date it was logged out of the safe, and the employee's initials on the aluminum clasp. The clasp found at Todd's home listed the date "6-2-94," the abbreviation "Fent. 100.56mg," and the initials "DJ." Id. at Page ID #21. Woods told the detectives that the initials "DJ" belonged to David Jewett, a former employee of the lab who supervised Raphalides. Id. According to the lab's logs, on June 2, 1994—the date listed on the vial found in Todd's home—Jewett logged out 100.4 milligrams of fentanyl.² Woods also confirmed that the fentanyl found in Todd's home had the same molecular structure as the fentanyl used in the lab.

The complaint alleges that the investigation into Todd's death stalled after WCSD detectives' second interview with Woods. Although the detectives attempted to contact Raphalides, they were unable to locate him. The detectives never informed the Kerchen family about their conversations with Woods, or the facts that indicated that the fentanyl that killed Todd could have originated from the University of Michigan lab. Heather Kerchen, Todd's sister, discovered the connection between the University lab and the investigation into Todd's death only after independently investigating Todd's death herself. She did not receive documents detailing the detectives' conversations with Woods until October 19, 2020.

B. Procedural History

Based on the facts above, Plaintiffs filed a complaint on October 17, 2022 against Raphalides, the University, Woods, and other unknown Defendants, listed as "Unknown Does." Compl., R. 1, Page ID #1. Plaintiffs sued both Raphalides and Woods in their individual and official capacities.³ Plaintiffs alleged six independent counts against all Defendants. First, they asserted a Fourteenth Amendment substantive due process claim under 42 U.S.C. § 1983, alleging that the Defendants deprived Todd of his life. They alleged that the University and Woods' lax policies surrounding the use of controlled substances in the lab and Raphalides' exploitation of these lax policies "shocked the conscience." Compl., R. 1, Page ID #29. Second, Plaintiffs asserted a wrongful death claim under Michigan state law against all Defendants. See M.C.L. § 600.2922. Finally, Plaintiffs asserted multiple counts under Michigan's Drug Dealer Liability Act ("DDLA"), which creates a civil cause of action for injuries caused by illegal drug use. See M.C.L. § 691.1601(2).

The University and Woods moved to dismiss the complaint pursuant to Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure. They primarily argued that all claims against them were barred by the statutes of limitations because Todd died more than twenty years before Plaintiffs filed their complaint. They further argued that the complaint had not sufficiently alleged any fraudulent concealment of facts by Defendants that may permit equitable tolling of the statutes of limitations. Defendants also contended that they were immune from suit under certain claims based on various theories of immunity. Specifically, they argued that the University and Woods in his official capacity were entitled to sovereign immunity for all claims, and that Woods in his individual capacity was entitled to qualified immunity for Plaintiffs' § 1983 claims and governmental immunity for Plaintiffs' state law wrongful death claim. Finally, they argued that Plaintiffs had failed to state a claim for relief under the Michigan DDLA.

In supplemental briefing supporting their motion to dismiss, Defendants presented a second ground to dismiss the state law claims asserted against the University and Woods in his official capacity. They argued that Plaintiffs' failure to give notice to the state of Michigan before filing suit required dismissal of these claims. Michigan law requires a party bringing a personal injury claim against the state to provide notice of the suit within six months of the action's accrual. See M.C.L. § 600.6431(1), (4). Previously, a panel of the Michigan Court of Appeals held that this statutory notice requirement only applied to cases brought against the state in the Michigan Court of Claims. See Tyrrell v. Univ....