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Smith v. Amylin Pharmaceuticals, LLC

United States District Court, Ninth Circuit

July 10, 2013

DAWN SMITH, an individual, Plaintiff,
v.
AMYLIN PHARMACEUTICALS, LLC f/k/a AMYLIN PHARMACEUTICALS, INC., a limited liability company; McKESSON CORPORATION, a Delaware corporation; ELI LILLY AND COMPANY, a corporation; NOVO NORDISK, INC., a Delaware corporation; NOV NORDISK A/S, a foreign corporation; and Does 1 through 100, Defendants.

ORDER GRANTING PLAINTIFF'S MOTION TO REMAND Doc. No. 9.

ANTHONY J. BATTAGLIA, District Judge.

Presently before the Court is Plaintiff Dawn Smith's ("Plaintiff") motion to remand pursuant to 28 U.S.C. § 1447(c). (Doc. No. 9.) Defendant Amylin Pharmaceuticals LLC f/k/a Amylin Pharmaceuticals, Inc. ("Amylin") filed an opposition on June 26, 2013, (Doc. No. 11), and Plaintiff filed a reply on July 3, 2013, (Doc. No. 12). In accordance with Civil Local Rule 7.1.d.1, the Court finds the motion suitable for determination on the papers and without oral argument. Accordingly, the motion hearing scheduled for July 25, 2013, is hereby vacated. For the reasons set below, the Court GRANTS Plain-tiff's motion to remand. (Doc. No. 9.) The Clerk of Court is instructed to remand the action to San Diego Superior Court.

BACKGROUND

On April 4, 2013, Plaintiff commenced this products liability action in San Diego Superior Court, alleging seven state law causes of action against all Defendants for: (1) strict liability based on inadequate warnings; (2) strict liability based on a design defect: (3) negligence; (4) breach of the implied warranty of merchantability; (5) breach of express warranty; (6) negligent misrepresentation; and (7) fraudulent concealment. (Doc. No. 1, Ex. A.) The Complaint alleges Plaintiff developed pancreatic cancer as a result of her ingestion of the prescription drugs Byetta and Victoza, which were prescribed to Plaintiff to treat her Type 2 diabetes. (Compl. ¶¶ 1, 2, 72.) Plaintiff alleges both Byetta and Victoza were manufactured by Amylin and Novo Nordisk Inc./Novo Nordisk A/S ("Novo Nordisk"), and that McKesson Corporation ("McKesson") not only distributed Byetta, but also partnered with Amylin and Eli Lilly and Company ("Eli Lilly") to assist pharmacists, counsel patients, and market, promote, and distribute safety information regarding Byetta, ( Id. at ¶¶ 19-29.)

On May 24, 2013, Amylin removed the action to this Court on the basis of complete diversity between Plaintiff and all properly joined Defendants. (Doc. No. 1 ¶ 3.) Amylin contends McKesson was fraudulently joined, and therefore McKesson's citizenship should be disregarded for purposes of determining the right to remove the action based on complete diversity. Eli Lilly and Novo Nordisk filed their consent to and joinder in Amylin's notice of removal on May 23, 2013 and May 24, 2013, respectively. (Doc. No. 1, Exs. B, C.) McKesson did not file a notice of consent. Plaintiff filed the instant motion to remand on June 12, 2013. (Doc. No. 9.)

LEGAL STANDARD

The right to remove a case to federal court is entirely a creature of statute. See Libhart v. Santa Monica Dairy Co., 592 F.2d 1062, 1064 (9th Cir. 1979). The removal statute, 28 U.S.C. § 1441, allows defendants to remove an action when a case originally filed in state court presents a federal question, or is between citizens of different states and involves an amount in controversy that exceeds $75, 000. See 28 U.S.C. §§ 1441(a) and (b); 28 U.S.C. §§ 1331, 1332(a). "[J]urisdiction in a diversity case is determined at the time of removal, " Am. Dental Indus., Inc. v. EAX Worldwide, Inc., 228 F.Supp.2d 1155, 1157 (D. Or. 2002), and only state court actions that could originally have been filed in federal court can be removed, 28 U.S.C. § 1441(a); Caterpillar, Inc. v. Williams, 482 U.S. 386, 392, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987); Ethridge v. Harbor House Rest., 861 F.2d 1389, 1393 (9th Cir. 1988); see also St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 289, 58 S.Ct. 586, 82 L.Ed. 845 (1938) ("The inability of plaintiff to recover an amount adequate to give the court jurisdiction does not show his bad faith or oust the jurisdiction... Events occurring subsequent to the institution of suit which reduce the amount recoverable below the statutory limit do not oust jurisdiction").

The Ninth Circuit "strictly construe[s] the removal statute against removal jurisdic-tion, " and "[f]ederal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance." Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992) (citing Boggs v. Lewis, 863 F.2d 662, 663 (9th Cir. 1988). "The strong presumption' against removal jurisdiction means that the defendant always has the burden of establish-ing that removal is proper." Id. (citing Nishimoto v. Federman-Bachrach & Assocs., 903 F.2d 709, 712 n.3 (9th Cir. 1990); Emrich v. Touche Ross & Co., 846 F.2d 1190, 1195 (9th Cir. 1988)).

DISCUSSION

Plaintiff alleges the instant action should be remanded because: (1) the Court lacks subject matter jurisdiction over the matter because Plaintiff and Defendant McKesson are both citizens of California; and (2) Amylin's notice of removal was procedurally defective because it violated the forum defendant rule and the unanimity rule.[1] There-fore, because Plaintiff and Defendant McKesson are both citizens of California, and McKesson did not join Amylin's notice of removal, Plaintiff contends remand is re-quired. Because the Court finds McKesson was not fraudulently joined, and remands the action to San Diego Superior Court on that basis alone, the Court does not address the parties' respective arguments regarding the procedural defects in Amylin's notice of removal.

I. Diversity Jurisdiction

District courts have "original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs..." and there is complete diversity between the parties, i.e., all plaintiffs have a citizenship different than all defendants. 28 U.S.C. § 1332(a); see also Matheson v. Progressive Specialty Ins. Co., 319 F.3d 1089, 1090 (9th Cir. 2003) ("[J]urisdiction founded on [diversity] requires that the parties be in complete diversity and the amount in contro-versy exceed $75, 000"); Caterpillar, 519 U.S. at 68 & n.3. "An exception to the requirement for complete diversity exists however, when a non-diverse defendant has been fraudulently joined for the purposes of defeating diversity jurisdiction." McCabe v. Gen. Foods Corp., 811 F.2d 1336, 1339 (9th Cir. 1987). "In that case, the district court may disregard a non-diverse party named in the state court complaint and retain jurisdic-tion if joinder of the non-diverse party is a sham or fraudulent." Pasco v. Red Robin Gourmet Burgers, Inc., No. 11-cv-01402 AWI-SKI, at *2 (E.D. Cal. November 17, 2011).

A. Complete Diversity and Fraudulent Joinder

Amylin contends the Court has subject matter jurisdiction over the matter because there is complete diversity of citizenship between Plaintiff and each of the properly joined Defendants-Amylin, Eli Lilly, and Novo Nordisk.[2] Although Amylin admits that Plaintiff and Defendant McKesson are both citizens of California, and that McKesson failed to join Amylin's notice of removal, Amylin argues McKesson's citizenship and failure to join the notice of ...


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