Luxford v. Dalkon Shield Claimants Trust

978 F.Supp. 221

Carol Lynn LUXFORD, Dennis Roy Luxford v. DALKON SHIELD CLAIMANTS TRUST.

Civil Action No. K-96-1383.

United States District Court, D. Maryland.

September 12, 1997.

Michael A. Pretl and Ashcraft & Gerel, Baltimore, MD and H. Robert Erwin, Jr. and The Erwin Law Firm, Baltimore, MD, for Plaintiffs.

Paul F. Strain, Dino S. Sangiamo, Mark D. Maneche and Venable, Baetjer & Howard, LLP, Baltimore, MD, for Defendant.

MEMORANDUM

GRIMM, United States Magistrate Judge.

Plaintiffs have sued the Dalkon Shield Claimants Trust ("Trust") in an effort to recover for personal injuries allegedly sustained from plaintiff Carol Lynn Luxford's use of the Dalkon Shield, an intrauterine device ("IUD") manufactured and sold by the A.H. Robins Company ("Robins"). The case has been referred to me for final disposition by consent of the parties pursuant to 28 U.S.C. § 636(c) (1993) and Local Rule 301 (D.Md.1997). Now pending is the Trust's Motion for Summary Judgment, plaintiffs' opposition thereto and the Trust's reply. (Paper Nos. 18, 20 and 21). Having read and considered the papers submitted by the parties, and having heard oral argument on August 18, 1997, the Trust's motion will be granted.

BACKGROUND

In September 1981, Ms. Luxford, an Oregon resident, filed suit against Robins in the United States District Court for the District of Oregon, alleging that use of the Dalkon Shield between September 1971 and May 1977 rendered her infertile. Robins moved to dismiss the case on grounds that the action was barred by an Oregon statute of repose, Or.Rev.Stat. § 30.905, which at that time required that all product liability actions be brought within eight years of the date that the product was purchased. By order dated August 26, 1983, the Oregon district court granted Robins' Motion for Summary Judgment, holding that Ms. Luxford's case was time-barred by Oregon's statute of repose. Ms. Luxford did not appeal.¹

While the Oregon case was pending, the Luxfords filed an additional lawsuit against Robins in this Court, again alleging that Ms. Luxford had been seriously and permanently injured from use of the Dalkon Shield. Sitting in diversity, on December 20, 1984, the Court (Senior District Judge Northrop) entered summary judgment against the Luxfords, finding that the August 1983 decision by the Oregon district court — based upon the state statute of repose — was a valid, final adjudication on the merits which was claim preclusive. In re Dalkon Shield Cases, 599 F.Supp. 1351, 1353 (D.Md.1984).

Joined by nearly 50 other Oregon Dalkon Shield claimants whose lawsuits against Robins had also been dismissed by Judge Northrop, the Luxfords noted a timely appeal with the Fourth Circuit. While the case was before the Fourth Circuit, Robins filed a petition for bankruptcy in the United States District Court for the Eastern District of Virginia. All Dalkon Shield litigation, including the plaintiffs' appeal, was consequently stayed.

During the bankruptcy stay, and while the plaintiffs' appeal was pending, Oregon's legislature promulgated a series of laws exempting IUD-related injuries from the eight year state statute of repose (hereinafter referred to as the "Oregon IUD legislation"). The first Act was passed in 1987. 1987 Or. Laws ch.4 §§ 5-10. Sections 5 and 6 of the 1987 Act replaced the eight year repose bar with a two year statute of limitations running from the date of discovery, and made this rule applicable to all cases tried after the Act's effective date. Section 8 of the Act established a one year period for refiling claims that had been dismissed on grounds that they were time-barred under the prior repose statute regardless of when the cause of action accrued, provided the suit was dismissed on or after July 1, 1977. Two years later, the Oregon legislature passed an additional statute which effectively precluded IUD manufacturers from asserting any statutes of limitation or repose defenses. 1989 Or. Laws ch. 642. Section 4 of this Act provided that "[a]ny such action in which final judgment has been entered in favor of the manufacturer based solely on a previous version of the statute of limitations or repose may be refiled within one year of the effective date of this Act." 1989 Or. Laws ch. 642 § 4. Thus, the final change to Oregon's statute of repose was passed, in part, to specifically authorize the reopening of final judgments against IUD plaintiffs whose cases had previously been dismissed as time-barred.

In response to the Oregon IUD legislation, a consent order was entered by the Virginia bankruptcy court under which the refiling periods set forth in the Oregon IUD legislation would be tolled until 30 days after the expiration of the Robins' bankruptcy stay.² Robins, however, expressly reserved its right to challenge the constitutionality of this legislation.³

On December 15, 1989, Robins emerged from bankruptcy under a Plan of Reorganization which created the Trust.⁴ Approximately two years later, the Fourth Circuit mistakenly dismissed the Luxfords' appeal. See Shadburne-Vinton v. Dalkon Shield Claimants Trust, 60 F.3d 1071, 1073 (4th Cir.1995). The Luxfords did not seek reconsideration of the order of dismissal. Instead, on April 1, 1996, they filed another lawsuit against the Trust in the Circuit Court for Baltimore City. The Trust subsequently removed the case to this Court pursuant to 28 U.S.C. § 1452(a) and 28 U.S.C. § 1334(b). I recently denied the plaintiffs' motion to remand the case back to the Maryland state courts. (Paper No. 17). The Trust now moves for summary judgment on the grounds that the 1983 judgment entered against Ms. Luxford by the Oregon federal court bars the plaintiffs' claims.

DISCUSSION

Resolution of the Trust's pending motion requires consideration of two issues. The first issue is whether the 1983 judgment entered against Ms. Luxford is entitled to claim preclusive effect, as the Trust contends.⁵ This question was addressed and resolved by this Court in Pottratz v. Davis, 588 F.Supp. 949, 954 (D.Md.1984), and the In re Dalkon Shield Cases, 599 F.Supp. 1351, 1353-54 (D.Md.1984). Plaintiffs do not contest the correctness of these decisions, or otherwise attempt to reargue the issue here, and I am persuaded that the Court's prior resolution of this question remains correct.⁶

The second and more difficult issue — and one which appears to be of first impression — is whether the retroactive provisions of the Oregon IUD legislation can now, consistent with the Constitution, resurrect the plaintiffs' claims, despite the entry of a valid, final judgment against Ms. Luxford in 1983. Predictably, the plaintiffs urge that it can, and argue that the Fourth Circuit's decision in Shadburne-Vinton v. Dalkon Shield Claimants Trust, 60 F.3d 1071 (4th Cir.1995), says so. The Trust insists, conversely, that the Supreme Court's decision in Plaut v. Spendthrift Farm, Inc., 514 U.S. 211, 115 S.Ct. 1447, 131 L.Ed.2d 328 (1995), is dispositive, and that retroactive application of the Oregon IUD legislation to revive the plaintiffs' claims in this case is unconstitutional. I am convinced that neither Shadburne nor Plaut squarely address this issue, and that the case turns upon application of the vested rights doctrine under the Fourteenth Amendment's Due Process Clause. The starting point, however, is the Shadburne decision.

A. Shadburne-Vinton v. Dalkon Shield Claimants Trust

Shadburne, like the present case, involved a personal injury suit by an Oregon Dalkon Shield claimant, Susan Shadburne, against Robins. Shadburne originally filed suit in this Court in January 1983. See In re Dalkon Shield Cases, 599 F.Supp. at 1356. Applying the then existing version of Oregon's statute of repose, in December 1984, Judge Northrop granted summary judgment in favor of Robins, holding that Shadburne's claims were time-barred because she had not filed suit within eight years of the insertion of her IUD. Id. Along with a number of other Dalkon Shield plaintiffs, including Ms. Luxford, Shadburne filed an appeal with the Fourth Circuit. Shadburne v. Dalkon Shield Claimants Trust, 851 F.Supp. 712 (D.Md. 1994). As noted, during the pendency of this appeal, Robins entered bankruptcy and the Oregon IUD legislation was passed.

After Shadburne's appeal was erroneously dismissed, see Shadburne-Vinton v. Dalkon Shield Claimants Trust, 60 F.3d 1071, 1073 (4th Cir.1995), upon motion, her case was reinstated in this Court. The Trust thereafter filed a motion for judgment on the pleadings, attacking the constitutionality of those provisions of the Oregon IUD legislation which purported to revive claims extinguished by the prior statute of repose. Shadburne, 851 F.Supp. at 713. During argument on this motion, Judge Kaufman raised the question of whether the Court had jurisdiction to decide this issue in light of the dismissal of Shadburne's appeal. Id. at 713-14. Proceedings consequently were stayed until early 1994, when the Fourth Circuit determined that Shadburne's appeal had been dismissed in error. The Fourth Circuit subsequently recalled its mandate, and remanded Shadburne's case back to the district court. Id. at 714. It is critical to keep in mind the posture of the case at this point. The original suit filed by Shadburne against Robins was, and continuously had been from its inception, pending, and there had never been a final judgment entered against the plaintiff. This distinction is of foremost importance in understanding the difference between Shadburne and the present case.

On remand, Judge Kaufman agreed with the Trust, and held that the Oregon IUD legislation ran afoul of the Fourteenth Amendment's Due Process Clause. In reaching this conclusion, he noted that the Supreme Court had made a distinction between retroactive enlargement of statutes of limitation, which affected only remedies available to the litigants, and statutes of ultimate repose, which affected liability, "upholding the former while...