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Wilbur Norris; Michael G. Dodder; Austin L. v. Astrazeneca Pharmaceuticals Lp; Astrazeneca

May 30, 2012


The opinion of the court was delivered by: Hon. Jeffrey T. Miller United States District Judge


Pursuant to 28 U.S.C. §1447(c), Plaintiffs move to remand their products liability action to state court. Defendants AstraZeneca Pharmaceuticals LP and AstraZeneca LP (collectively "AstraZeneca") oppose the motion to remand and separately move to dismiss the complaint for failure to state a claim, to change venue, and to sever and transfer the claims of the individual Plaintiffs. Defendant McKesson Corporation ("McKesson") has not responded to the motions; and Plaintiffs oppose AstraZeneca's motions. Pursuant to Local Rule 7.1(d)(1), the court finds the matters presented appropriate for decision without oral argument. For the reasons set forth below, the court grants the motion to remand and denies all other motions as moot. The Clerk of Court is instructed to remand this action to state court.


On March 19, 2012, Plaintiffs commenced this products liability action in the Superior Court for the County of Imperial, alleging seven causes of action for (1) strict liability; (2) negligence; (3) breach of express warranty; (4) breach of implied warranty; (5) fraud; (6) fraudulent concealment; and (7) loss of consortium. The nine Plaintiffs are alleged residents and citizens of either California, Nevada, Utah, and Washington. (Compl. ¶¶1-7). AstraZeneca LP and AstraZeneca Pharmaceuticals LP are business entities domiciled in the State of Delaware with their principal place of business in that state. (Comp. 8). McKesson is incorporated in the State of Delaware with its principal place of business in California. (Compl. ¶9).

In broad brush, Plaintiffs allege that AstraZeneca manufactured Crestor, a cholesterol lowering medication, and McKesson distributed the drug to Plaintiffs. (Compl. ¶¶ 19-24). Plaintiffs allege that "Crestor has been linked to such serious side effects as cardiomyopathy, heart attacks, heart muscle deterioration, sudden cardiac death, rhabdomyolysis (muscle deterioration), kidney and liver damage, and diabetes." Id. Plaintiffs further allege that "Defendants did act together to design, sell, advertise, manufacture and/or distribute Crestor, with full knowledge of its dangerous and defective nature," and that Plaintiffs suffered cognizable injuries. (Compl. ¶14).

On April 5, 2012 Defendants removed the action, alleging both diversity and federal question jurisdiction. (Ct. Dkt. 1). In order to assert diversity jurisdiction, Defendants contend that McKesson was fraudulently joined to defeat federal jurisdiction.

Plaintiffs now move to remand the action and to stay all proceedings pending resolution of the motion to remand, and Defendants to dismiss certain claims, to change venue, and to transfer and sever. All motions are opposed.


Diversity Jurisdiction

A civil action brought in state court may be removed to federal court by a defendant when federal courts have original jurisdiction over the matter. 28 U.S.C. § 1441. Where jurisdiction is based upon diversity of citizenship, joinder of a non-diverse defendant is deemed fraudulent, and the defendant's presence in the lawsuit is ignored, for purposes of determining diversity "[i]f the plaintiff fails to state a cause of action against a resident defendant, and the failure is obvious according to the settled rules of the state." McCabe v. Gen. Foods Corp., 811 F.2d 1336, 1339 (9th Cir. 1987); Hamilton Materials, Inc. v. Dow Chemical Corp., 494 F.3d 1203,1206 (9th Cir. 2007). "[T]he question is simply whether there is any possibility that plaintiff will be able to establish liability against the party in question." Briano v. Conseco Life Ins. Co., 126 F.Supp.2d 1293, 1296 (C.D. Cal. 2000). The party who invokes federal removal jurisdiction has the burden of demonstrating the existence of federal jurisdiction. See Gaus v. Miles, Inc. 980 F.2d 564, 566 (9th Cir. 1992); B., Inc. v. Miller Brewing Co., 663 F.2d 545 (5th Cir. 1981). In determining whether joinder is fraudulent, the court considers the complaint, facts identified in the Notice of Removal and any pertinent affidavits or declarations submitted by the removing party or in rebuttal. See Ritchey v. Upjohn Drug Co., 139 F.3d 1313, 1318 (9th Cir. 1998). Any doubts regarding removal jurisdiction are construed against removal and in favor of remanding the case to state court. See Gaus, 980 F.2d at 566.

AstraZeneca contends that McKesson is not a proper party because (1) there is no liability for distributors of pharmaceuticals and (2) there is no support for Plaintiffs' allegation that McKesson actually distributed the drug at issue to Plaintiffs. Neither argument is persuasive. Virtually every court that has considered the issue now before the court has concluded that California state law recognizes a products liability claim against a distributor. The general rule in California is that both manufacturers and distributors are strictly liable for injuries caused by a defective product. Maher v. Novartis Pharmaceuticals Corp., 2007 U.S. Dist Lexis 58984 at *7-8 (citing Bostick v. Flex Equipment Co., 147 Cal.App.4th 80, 88 (2007)); Black v. Merck & Co. Inc., U.S. District LEXIS 29860 at*10 (C.D. Cal. 2004) (strict liability for failure to warn extends beyond manufacturers to retailers and wholesalers); Andrews v. Bayer Corp., Case No. CV 09-08762 DDP (FFMx); Holland v. Bayer Corp, CASE No. SACV 09-1350 DOC (RNBx) (finding that Bayer fails to demonstrate that McKesson is fraudulently joined); Mandernach v. Bayer Corp, Case No. 5:09-cv-02306 JHN (Opx) (same); Grove v. Bayer Corp, Case No. SADV 09-1509 AG (MLGx).

In Maher v. Novartis Pharmaceuticals Corp., No. 07cv0852 WQH (JMA), Judge Hayes granted the plaintiff's motion to remand an action commenced against a pharmaceutical manufacturer and its distributor, McKesson. The court noted the general rule in California that distributors and other "participants in the chain of distribution" are strictly liable in defective products cases. Bostick v. Flex Equipment Co., 147 Cal. App.4th 80, 88 (2007). The court then noted:

This court has been unable to find, nor has either party cited, a case under California law which creates an exception in strict liability for distributors in prescription drug cases. This court cannot conclude that it is obvious that the general rule of distributor liability does not apply under the allegations of this case.

LEXIS U.S. Dist., Lexis 58984 at *12. Accordingly, the court concludes that the complaint adequately establishes that a distributor of ...

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