E. Me. Med. Ctr. v. Teva Pharm. USA Inc.

581 F.Supp.3d 281

EASTERN MAINE MEDICAL CENTER, et al., Plaintiffs,

v.TEVA PHARMACEUTICALS USA INC., et al., Defendants.

2:21-cv-00320-JDL

United States District Court, D. Maine.

Signed January 19, 2022

Jonathan W. Cuneo, Monica Evan Miller, Cuneo Gilbert & Laduca LLP, Washington, DC, Kelly W. McDonald, Richard L. O'Meara, Murray Plumb & Murray, Portland, ME, for Plaintiffs.

Jeff Goldman, Morgan, Lewis & Brockius LLP, Boston, MA, for Defendants Teva Pharmaceuticals USA Inc., Cephalon Inc., Watson Laboratories Inc., Actavis Pharma Inc., Actavis LLC, Jason Nagel, Frank Neel.

James M. Campbell, Campbell Conroy & O'Neil, P.C., Michelle I. Schaffer, Campbell, Campbell, Edwards & Conroy, Boston, MA, for Defendants Johnson & Johnson, Janssen Pharmaceuticals Inc.

Walter F. McKee, McKee Law LLC PA, Augusta, ME, for Defendants Endo Health Solutions Inc., Endo Pharmaceuticals Inc., Par Pharmaceuticals Companies Inc., Par Pharmaceutical Inc., Jeff Saucier.

Donna Welch, Pro Hac Vice, Kirkland & Ellis LLP, Chicago, IL, Sigmund D. Schutz, Preti, Flaherty, Portland, ME, for Defendants Allergan Finance LLC, Allergan Sales LLC, Allergan USA Inc., Marc Blattstein.

David B. Alden, Pro Hac Vice, Jones Day, Cleveland, OH, Sigmund D. Schutz, Preti, Flaherty, Portland, ME, for Defendant Abbvie Inc.

Louis W. Schack, Pro Hac Vice, Reed Smith LLP, Philadelphia, PA, Jeffrey D. Russell, Lambert Coffin, Portland, ME, for Defendants Amerisourcebergen Drug Corporation, Xcenda LLC.

David M. Howard, Devine, Millimet & Branch, P.A., Manchester, NH, for Defendant Cardinal Health Inc.

James W. Matthews, Pro Hac Vice, Foley & Lardner, LLP, Boston, MA, David Soley, Glenn Israel, James G. Monteleone, Bernstein Shur, Portland, ME, for Defendant Anda Inc.

Jeffrey D. Russell, Lambert Coffin, Portland, ME, William E. Padgett, Pro Hac Vice, Barnes & Thornburg LLP, Indianapolis, IN, for Defendant HD Smith LLC.

William D. Pandolph, Sulloway & Hollis PLLC, Concord, NH, for Defendant McKesson Corporation.

Joseph L. Cahoon, Jr., Richardson, Whitman, Large & Badger, Portland, ME, for Defendants Walgreen CO, Walgreen Eastern Co., Inc.

Geraldine G. Sanchez, Roach Hewitt Ruprecht Sanchez & Bischoff, P.C., Portland, ME, for Defendants CVS Pharmacy Inc., CVS Orlando FL Distribution LLC, CVS TN Distribution LLC.

Gerald F. Petruccelli, Petruccelli, Martin & Haddow LLP, Portland, ME, for Defendants Rite Aid of Maine Inc., Rite Aid of Maryland Inc., PJC Distribution Inc., Eckerd Corporation.

J. William Druary, Jr., Erin L. Murphy, Marden, Dubord, Bernier & Stevens PA LLC, Waterville, ME, James W. Carlson, Pro Hac Vice, Jones Day, Pittsburgh, PA, for Defendants Walmart Inc., Wal-Mart Stores East LP.

ORDER ON EMERGENCY MOTION TO REMAND AND MOTION TO STAY

JON D. LEVY, CHIEF UNITED STATES DISTRICT JUDGE

On September 10, 2021, nine nonprofit corporations that operate hospitals in Maine—Eastern Maine Medical Center, Aroostook Medical Center, Blue Hill Memorial Hospital, Charles A. Dean Memorial Hospital, Inland Hospital, Maine Coast Regional Health Facilities, Mercy Hospital; MRH Corp., and Sebasticook Valley Health (together, "Plaintiffs")— filed a lawsuit in the Maine Superior Court (ECF No. 1-1) against several defendants that are alleged to have unlawfully marketed, distributed, and dispensed prescription opioids. Plaintiffs assert six state-law causes of action and primarily seek to recover what they have paid and will pay to provide opioid-related care.

On November 12, 2021, four of the defendants—Walmart Inc.; Wal-Mart Stores East, LP; Walgreen Co.; and Walgreen Eastern Co. (together, "Defendants")—removed the case to federal court (ECF No. 1), claiming federal question jurisdiction. See 28 U.S.C.A. § 1331 (West 2022). The Plaintiffs filed an Emergency Motion to Remand (ECF No. 13) on November 19, 2021.

On November 23, 2021, the Judicial Panel on Multidistrict Litigation ("JPML") entered a conditional transfer order that identified this case as involving questions of fact common to 2,207 actions that the JPML had previously transferred to the U.S. District Court for the Northern District of Ohio for coordinated or consolidated proceedings pursuant to 28 U.S.C. § 1407. Conditional Transfer Order (CTO-210) at 1, In re Nat'l Prescription Opiate Litig. , MDL No. 2804 (J.P.M.L. Nov. 23, 2021), ECF No. 9416. The JPML stayed the transmittal of its order to give the parties time to oppose the transfer, id. , which the Plaintiffs subsequently did, Pls.’ Notice of Opp'n to Conditional Transfer Order (CTO-210), MDL No. 2804 (J.P.M.L. Nov. 29, 2021), ECF No. 9420. On November 24, 2021, the Defendants filed a Motion to Stay (ECF No. 22) this proceeding until the JPML decides whether to transfer this case. The JPML is scheduled to consider the transfer issue at a hearing session on January 27, 2022.

The JPML has already transferred 22 similar opioid actions from this District, all involving complaints brought by counties and cities. Those transfers do not amount to a determination by the JPML that federal jurisdiction exists in those cases, and "opposition to transfer challenging the propriety of federal jurisdiction is insufficient to warrant vacating conditional transfer orders covering otherwise factually-related cases." Transfer Order at 2, MDL No. 2804 (J.P.M.L. Dec. 6, 2018), ECF No. 3169 (transferring three Maine cases over jurisdictional objections). For three of the 22 cases, Magistrate Judge Nivison recommended that they be stayed pending the JPML's decisions, City of Portland v. Purdue Pharma, LP , Nos. 1:18-cv-00298, 2:18-cv-00310, 2018 WL 6191127, at *5 (D. Me. Nov. 28, 2018), and his Recommended Decision was not acted upon before the JPML transferred the cases.¹ In the remaining 19 actions, there were no motions to remand, and jurisdiction was not addressed before the transfer occurred.² Accordingly, this case presents a nearly-blank slate in this District as to how the Supreme Court's teachings on federal jurisdiction, particularly the law of embedded federal questions, apply in cases arising out of practices associated with the distribution of opioids. For the reasons that follow, I grant the Plaintiffs’ Emergency Motion to Remand and deny as moot the Defendants’ Motion to Stay.

I. METHODOLOGY

I begin with the analytical framework for prioritizing between the remand and stay motions.

A district court may decide a motion to remand notwithstanding a pending conditional transfer order from the JPML. "The pendency of a ... conditional transfer order ... before the [JPML] ... does not affect or suspend orders and pretrial proceedings in any pending federal district court action and does not limit the pretrial jurisdiction of that court." J.P.M.L. R. 2.1(d). While "remand motions can be presented to and decided by the transferee judge," district courts "wishing to address such motions have adequate time in which to do so" themselves. In re Prudential Ins. Co. of Am. Sales Pracs. Litig. , 170 F. Supp. 2d 1346, 1347 (J.P.M.L. 2001).

Nonetheless, when a potential transfer by the JPML looms, dueling remand and stay motions force district courts to balance substantial but rival interests. On the one hand, "important values of federalism and separation of powers are implicated in the limited jurisdiction of federal courts." Est. of Harshman v. Jackson Hole Mountain Resort Corp. , 379 F.3d 1161, 1164 (10th Cir. 2004). Indeed, that is why subject-matter jurisdiction "can be raised sua sponte at any time," McBee v. Delica Co. , 417 F.3d 107, 127 (1st Cir. 2005), and "challenges to federal subject matter jurisdiction may be raised for the first time on appeal," Am. Fiber & Finishing, Inc. v. Tyco Healthcare Grp., LP , 362 F.3d 136, 138-39 (1st Cir. 2004). On the other hand, when the court managing multidistrict litigation is slated to answer a particular jurisdictional question in the context of already-transferred cases, a district court that decides that same issue duplicates efforts and risks inconsistent outcomes. In light of this tension, courts do well to consider whether "a stay would further the policies of judicial economy, efficiency, and consistency that are deeply embodied in the [multidistrict litigation] statute." 15 Charles Allen Wright, Arthur R. Miller & Richard D. Freer , Federal Practice and Procedure § 3866.1 (4th ed. 2021) ; see also Manual for Complex Litigation (Fourth) § 20.131 (2004) ("[M]otions to ... remand, raising issues unique to the particular case, may be particularly appropriate for resolution before the [JPML] acts on the motion to transfer.").

Many courts have balanced the imperative of ensuring federal jurisdiction and the benefits of multidistrict litigation through the three-step methodology set forth in Meyers v. Bayer AG , 143 F. Supp. 2d 1044, 1049 (E.D. Wis. 2001), a procedure that "is ... consistent with the policy underlying" the multidistrict litigation statute. Wright, Miller & Freer , supra , § 3866.1 ; see, e.g. , City of Portland , 2018 WL 6191127, at *5 ("The court's approach in [ Meyers ] is instructive."); DCH Health Care Auth. v. Purdue Pharma L.P. , CIVIL ACTION 19-0756-WS-C, 2019 WL 6493932, at *2 (S.D. Ala. Dec. 3, 2019) ("Dozens of sister courts have adopted or applied Meyers as well, and it has been described as the majority approach." (footnote omitted)). First, if a "preliminary assessment suggests that removal was improper, the court should promptly ... remand the case to state court." Meyers , 143 F. Supp. 2d at 1049. But if the preliminary assessment instead reveals that the jurisdictional issue is "factually or legally difficult, the court's second step should be to determine whether identical or similar jurisdictional issues have been raised in other cases that have been or may be transferred to the" multidistrict litigation. Id. If so, "the court proceed[s] to the third step and consider[s] the motion to stay," although this third step "does not mandate that a stay should be granted." Id.

This three-step approach appropriately...