Walters v. AngioDynamics, Inc.

MEMORANDUM AND ORDER

ALLISON D. BURROUGHS U.S. DISTRICT JUDGE

Plaintiff Jimmy Walters alleges that he was injured by a defective medical device made by Defendants AngioDynamics, Inc. (“AngioDynamics”) and Navilyst Medical, Inc. (“Navilyst, ” and, together with AngioDynamics, “Defendants”). [ECF No. 1-1]. Currently before the Court are Mr. Walters' motion for remand, [ECF No. 15], and Defendants' motion to dismiss for lack of personal jurisdiction, [ECF No. 8]. For the reasons set forth below, Mr. Walters' motion is DENIED, and Defendants' motion is GRANTED. Mr. Walters' complaint is DISMISSED without prejudice.

I. BACKGROUND

A. Factual Background

The following facts are taken primarily from the complaint, [ECF No. 1-1], the factual allegations of which are assumed to be true when considering a motion to dismiss. Ruivo v. Wells Fargo Bank, N.A., 766 F.3d 87, 90 (1st Cir. 2014).

Mr. Walters is a Texas resident. [ECF No. 1-1 ¶ 2]. AngioDynamics and Navilyst are both Delaware corporations. [Id. ¶¶ 3-4].

In or around 2007, Rita Medical Systems, Inc. (“Rita”) received clearance from the U.S. Food and Drug Administration to market and sell a vascular access device called the Vortex CT Port-Access System. [ECF No. 1-1 ¶ 15]. Around the same time, AngioDynamics acquired Rita's assets and liabilities and rebranded the device as the SmartPort CT (the “Device”). [Id. ¶ 16]. The Device is designed to deliver medication, intravenous fluids, parenteral nutrition solutions, and blood products directly into the bloodstream. [Id. ¶ 19]. The Device consists of two parts: an injection port and a polyurethane catheter. [Id. ¶ 21]. Because of an alleged design and manufacturing defect, the catheter sometimes fractures, which can lead to devastating results. [Id. ¶¶ 23-30, 34]. Before Mr. Walters was implanted with the Device, Defendants were aware that catheters were fracturing and pieces were migrating through patients' bodies, with catastrophic consequences. [Id. ¶¶ 38-42].

On March 1, 2019, Mr. Walters was implanted with the Device at a hospital in Texas. [ECF No. 1-1 ¶ 47]. On July 1, 2019, the Device, and fractured fragments from its catheter, were surgically removed from Mr. Walters at the same hospital. [Id. ¶ 48]. As a result of this ordeal, Mr. Walters experienced significant mental and physical pain and suffering, sustained physical injuries and permanent physical deformities, underwent (and will undergo additional) corrective surgery, and suffered financial and economic losses (including medical expenses and lost wages). [Id. ¶ 55].

B. Procedural Background

Mr. Walters filed this suit in Middlesex County Superior Court on June 14, 2021. [ECF No. 1-1]. On July 29, 2021, Defendants removed the case. [ECF No. 1]. On August 5, 2021,

Defendants moved to dismiss for lack of personal jurisdiction. [ECF No. 8]. Mr. Walters opposed on September 3, 2021, [ECF No. 22], and Defendants replied on September 22, 2021, [ECF No. 26]. Additionally, Mr. Walters filed a motion for remand on August 30, 2021, [ECF No. 15], which Defendants opposed on September 13, 2021, [ECF No. 25].

II. MR. WALTERS' MOTION FOR REMAND

Defendants removed this case based on diversity jurisdiction. See [ECF No. 1 ¶ 4]. “Federal diversity jurisdiction is available in cases arising between citizens of different states in which the amount in controversy exceeds $75, 000.” Rizzi v. 178 Lowell St. Operating Co., 180 F.Supp.3d 66, 67 (D. Mass. 2016) (citing 28 U.S.C. § 1332(a)). Mr. Walters acknowledges that the diversity and amount-in-controversy requirements are satisfied here but maintains that because Defendants are Massachusetts citizens, the “forum defendant rule” precludes removal. [ECF No. 16 at 3 (emphasis omitted)]. Defendants counter that the forum defendant rule has no bearing here because they are not Massachusetts citizens.^[1] [ECF No. 25 at 11-19].

Removal premised on diversity jurisdiction is improper “if any of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought.” 28 U.S.C. § 1441(b)(2). “This is known as the ‘forum defendant rule.'” DaSilva v. Baader Ger., 514 F.Supp.3d 393, 397 (D. Mass. 2021) (quoting Rizzi, 180 F.Supp.3d at 68). “A corporation's citizenship, for diversity jurisdiction purposes, is both the state where it is

incorporated and the state ‘where it has its principal place of business.'” Celli v. Greenwich Ins. Co., 478 F.Supp.3d 93, 95-96 (D. Mass. 2020) (quoting 28 U.S.C. § 1332(c)(1)).

It is undisputed that Defendants are incorporated in Delaware. See [ECF No. 1-1 ¶¶ 3-4; ECF No. 1-2 ¶¶ 3, 7]. Accordingly, the forum defendant rule would be applicable only if either AngioDynamics or Navilyst has its principal place of business in Massachusetts. For the reasons that follow, the Court finds that both AngioDynamics and Navilyst have their principal places of business in New York.

Several years ago, the Supreme Court established beyond any doubt that federal courts must employ the “nerve center” test to determine the location of a corporation's principal place of business. The test is straightforward. A corporation's “nerve center” (i.e., its principal place of business) is the particular location from which its “officers direct, control, and coordinate the corporation's activities.” Generally speaking, this will “be the place where the corporation maintains its headquarters-provided that the headquarters is the actual center of direction, control, and coordination . . . and not simply an office where the corporation holds its board meetings (for example, attended by directors and officers who have traveled there for the occasion).”

Harrison v. Granite Bay Care, Inc., 811 F.3d 36, 40 (1st Cir. 2016) (citations omitted) (quoting Hertz Corp. v. Friend, 559 U.S. 77, 80-81, 92-93 (2010)). “At its heart, the nerve center test is an inquiry to find the one location from which a corporation is ultimately controlled.” Id. at 41.

Based on the nerve center test, it is clear that Defendants' principal places of business are in New York. As noted in an affidavit filed by Stephen A. Trowbridge, AngioDynamics' Executive Vice President and CFO: (1) Navilyst is a wholly-owned subsidiary of AngioDynamics, [ECF No. 1-2 ¶ 6]; (2) Navilyst's U.S. operations are “entirely carried out and controlled by AngioDynamics, ” [id. ¶ 9]; (3) the people who work for Navilyst are AngioDynamics' employees, [id. ¶ 10]; (4) AngioDynamics' chief executives (including its CEO, CFO, and General Counsel) and its accounting, legal, and human resources departments are based in New York, [id. ¶ 8]; and (5) “[a]ll significant corporate decisions, ” for both

AngioDynamics and Navilyst, are made, or reviewed and approved, by executives based in New York, [id. ¶ 11].^[2] In light of this uncontroverted evidence, the Court finds that Defendants are “ultimately controlled” from New York. See Harrison, 811 F.3d at 41.

Mr. Walters advances evidence purportedly demonstrating that Defendants have their principal places of business in Massachusetts, [ECF No. 16 at 4-8], but the Court has already rejected nearly-identical evidence in two nearly-identical cases, Pettit v. AngioDynamics, Inc., No. 21-cv-10568, 2021 WL 4441261, at *3-4 (D. Mass. Sept. 28, 2021); Harness v. AngioDynamics, Inc., No. 21-cv-10233, 2021 WL 4441260, at *3-4 (D. Mass. Sept. 28, 2021), ^[3] and is no more persuaded this time around. At bottom, while Mr. Walters claims that Defendants' principal places of business are in Massachusetts, see, e.g., [ECF No. 16 at 2, 7], the evidence belies his position. Because Defendants' principal places of business are not in Massachusetts, the forum defendant rule does not preclude removal. Mr. Walters' motion for remand, [ECF No. 15], is therefore DENIED.

III. DEFENDANTS' MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION

The parties dispute whether Defendants are subject to the Court's personal jurisdiction. See [ECF No. 9; ECF No. 22]. For the reasons set forth below, the Court finds that they are not.

A. Legal Standard

Mr. Walters bears the burden of establishing that jurisdiction exists over Defendants. A Corp. v. All Am. Plumbing, Inc., 812 F.3d 54, 58 (1st Cir. 2016) (citing Phillips v. Prairie Eye Ctr., 530 F.3d 22, 26 (1st Cir. 2008)). “When a district court rules on a motion to dismiss for lack of personal jurisdiction without holding an evidentiary hearing . . . the ‘prima facie' standard governs its determination.” United States v. Swiss Am. Bank, Ltd., 274 F.3d 610, 618 (1st Cir. 2001). Under the prima facie standard, the plaintiff must proffer “evidence which, if credited, is sufficient to support findings of all facts essential to personal jurisdiction.” A Corp., 812 F.3d at 58 (quoting Prairie Eye Ctr., 530 F.3d at 26). “[P]laintiffs may not rely on unsupported allegations in their pleadings, ” and are instead “obliged to adduce evidence of specific facts” supporting jurisdiction. Platten v. HG Berm. Exempted Ltd., 437 F.3d 118, 134 (1st Cir. 2006) (alteration in original) (first quoting Boit v. Gar-Tec Prods., Inc., 967 F.2d 671, 675 (1st Cir. 1992); then quoting Foster-Miller, Inc. v. Babcock & Wilcox Can., 46 F.3d 138, 145 (1st Cir. 1995)). The Court takes as true whatever properly documented facts a plaintiff proffers, construes those facts in the light most favorable to the plaintiff, and considers facts put forward by the defendant only to the extent that they are uncontradicted. See Prairie Eye Ctr., 530 F.3d at 26; Platten, 437 F.3d at 134.

“In determining whether a non-resident defendant is subject to its jurisdiction, a federal court exercising diversity jurisdiction...