United States District Court, S.D. Alabama, Southern Division
K. DuBOSE CHIEF UNITED STATES DISTRICT JUDGE.
matter is before the Court on sixteen Defendants' motions
to stay (Docs. 7, 23); Plaintiffs' motion to remand (Doc.
3); and certain Defendants notice of bankruptcy (Doc. 20).
Specifically, the Manufacturer Defendants' (Johnson &
Johnson; Janssen Pharmaceuticals, Inc.; Allergan Sales, LLC;
Allergan USA, Inc.; Endo Health Solutions, Inc.; Endo
Pharmaceuticals, Inc.; Par Pharmaceutical, Inc.; Par
Pharmaceuticals Companies, Inc.; Teva Pharmaceuticals USA,
Inc.; Cephalon, Inc; Actavis LLC; Actavis Pharma, Inc.;
Mallinckrodt LLC; and SpecGx LLC) motion to stay (Doc. 7),
Plaintiffs' opposition (Doc. 11), Defendants' Reply
(Doc. 15), and Plaintiffs' sur-reply (Doc. 16-1).
Separately, the Distributer Defendants (McKesson Corporation,
Cardinal Health, Inc., H.D. Smith, LLC f/k/a H.D. Smith
Wholesale Drug Co., and AmerisourceBergen Drug Corporation)
filed a motion to stay. (Doc. 23). Also before the Court are
Plaintiffs' motion to remand (Doc. 3); Defendant McKesson
Corporation's Opposition (Doc. 24); and Plaintiffs
response (Doc. 26).
Sackler Defendants (Ilene Sackler Lefcourt, David Sackler,
Jonathan Sackler, Kathe Sackler, Mortimer D.A. Sackler,
Richard Sackler and Theresa Sackler) filed a “Notice of
Fourth Amended Bankruptcy Court Order Enjoining the
Continuation of this Proceeding as to the Individual Former
Directors.” (Doc. 20). The Court ordered briefing on
the impact of this injunction on the pending motions. (Doc.
22). Parties submitted briefs in response (Docs. 29, 30).
October 15, 2019, Plaintiffs Mobile County Board of Health
and Family Oriented Primary Health Care Clinic filed an
action in the Circuit Court of Mobile County, Alabama against
eight groups of defendants (Circuit Court of Mobile County
02-CV-2019-902806.00). Plaintiffs contend “Defendants
engaged in a wide variety of unlawful conduct that caused,
exacerbated, and perpetuated the opioid epidemic in the three
counties in which they provide services.” The complaint
asserts six (6) causes of action against all defendants based
on Alabama law: (1) negligence; (2) nuisance; (3) unjust
enrichment; (4) fraud and deceit; (5) wantonness; (6)
deceptive trade practices. (Doc. 1-2 at 164-179). The
complaint asserts a separate claim of civil conspiracy
against the Marketing Defendants, Distributor Defendants, and
National Retail Pharmacy Defendants. (Id. at 176).
November 20, 2019, Defendant McKesson Corporation (McKesson)
filed a notice of removal, removing this case from the
Circuit Court of Mobile County to this Court pursuant to
federal question jurisdiction. (Doc. 1). McKesson contends
that the bases of Plaintiffs' complaint “arise from
the federal Controlled Substances Act (“CSA”) and
its implementing regulations…” and Plaintiffs
therefore allege violations of federal law. (Id. at
November 11, 2019, Plaintiffs moved to remand the case to the
Circuit Court of Mobile County. (Doc. 3). Plaintiffs contend
removal was improper stating:
All of [their] claims arise under and are based upon Alabama
law; there is no assertion in the Complaint that Plaintiffs
are proceeding under any right of action created or
authorized by Congress or otherwise created or authorized by
any federal law or regulation.
(Doc. 3 at 4). McKesson opposes Plaintiffs' motion to
remand essentially reasserting its removal arguments. (Doc.
24). To date, no other defendants have responded to
Plaintiffs motion to remand.
November 27, 2019, the Manufacturer Defendants moved
“for a temporary stay of all proceedings in this case
until the Judicial Panel on Multidistrict Litigation (JPML)
renders a final decision on whether to transfer this action
to the Multidistrict Litigation in the Northern District of
Ohio, In re National Prescription Opiate Litig., No.
1:17-md-2804 (Opiate MDL).” (Doc. 7). On December 27,
2019, McKesson, Cardinal Health, Inc., H.D. Smith, LLC f/k/a
H.D. Smith Wholesale Drug Co., and AmerisourceBergen Drug
Corporation also filed a motion to stay these proceedings
“offer[ing] further grounds for this Court to stay
proceedings and defer consideration of Plaintiffs' remand
motion.” (Doc. 23 at 5, n.2). To date, the remaining
defendants have not filed like motions to stay, consent to
the pending motions to stay, or any other responses to these
December 18, 2019, the Sackler Defendants filed a
“Notice of Fourth Amended Bankruptcy Court Order
Enjoining the Continuation of this Proceeding to the
Individual Former Directors.” (Doc. 20). This filing
was to notify the Court of the injunction issued by the U.S.
Bankruptcy Court for the Southern District of New York's
order (last amended December 9, 2019), encompassing this
proceeding as to the Sackler Defendants. (Id.). On
December 23, 2019, the Court ordered the parties to submit
briefings as to the impact of the injunction on the
Court's authority to rule on the pending motions to stay
and remand. The parties submitted their briefings and contend
that the Court may decide the motion to remand without
violating the Fourth Amended Bankruptcy Injunction. (Doc. 29
at 1-2; Doc. 30 at 1).
district court has the inherent authority to stay proceedings
in the cases pending before it. Landis v. North American
Co., 299 U.S. 248 (1936); CTI-Container Leasing Corp
v. Uiterwyk, 685 F.2d 1284 (11th Cir. 1982).
“[T]he power to stay proceedings is incidental to the
power inherent in every court to control the disposition of
the causes on its docket with economy of time and effort for
itself, for counsel, and for litigants.”
Landis, 299 U.S. at 254. When a district court has
before it both a motion to remand and motion to stay, as is
the case here, the Court “possesses the jurisdiction to
resolve the motion to remand prior to a transfer of a case by
the JPML.” Wood v. Merck & Co., Inc., 2008
WL 4642615 (M.D. Fla. 2008); Rule 1.5 of the Rules of
Procedure of the Judicial Panel on Multidistrict Litigation.
A district court may also grant the motion to stay without
ruling on the motion to remand because the transferee MDL
judge can also rule on the pending motion to remand. In
re Vioxx Products Liability Litigation, 360 F.Supp.2d
1352, 1354 (2005).
the undersigned is not without guidance for how to proceed in
these unique circumstances. Last year, the Southern District
of Alabama handled a similar situation in DCH Health Care
Authority, et al., v. Purdue Pharma L.P., et al., 2019
WL 6493932 (S.D. Ala. Dec. 3, 2019). The Court finds this
case helpful to the resolution of the motions before it in
light of factual and legal similarities. The DCH
case thoroughly addressed pending motions to stay and a
motion to remand in a similar, complex opioid case. In that
case, plaintiffs asserted six state law claims, identical to
six of the seven claims asserted here. Defendants in
DCH removed the case from state court on the same
legal grounds as the Defendants removed this case to this
court. Additionally, the defendants in DCH and the
Defendants in this case raise virtually identical claims and
arguments, resulting in significant overlap of issues and
December 18, 2019, the Sackler Defendants filed a notice of
an injunction from the United States Bankruptcy Court for the
Southern District of New York. (Doc. 20). The Sackler
Defendants filed this notice in order to stop the
continuation of these proceedings as against them.
(Id. at 2). On December 23, 2019, the Court ordered
the parties to submit briefing as to the impact of this
injunction on the Court's authority to decide the pending
motions to stay and remand. The parties responded that this
injunction did not alter the Court's authority to rule on
the motion to remand. (Docs. 29, 30). The Courts review of
case law reveals the same. See Diebel v. S.B. Trucking
Co., 262 F.Supp.2d 1319, 1333 (S.D. Fla. 2003) (finding
the automatic stay did not prevent the court from remanding
an improperly removed action); Gallaher v. Waving Leaves,
Inc., 2006 WL 898130 at *2 (N.D. W.Va. 2006) (the
automatic stay does not bar consideration of a motion to
remand an improperly removed case); Verizon
Communications, Inc. v. Northpoint Communications Group,
Inc., 262 B.R. 891, 892-93 (D. Del. 2001) (same);
Baxter Healthcare Corp. v. Hemex Liquidation Trust,
132 B.R. 863, 867 (N.D. Ill. 1991) (same); Liljeberg
Enterprises International, LLC v. Vista Hospital, Inc.,
2004 WL 2725965 at *1 (E.D. La. 2004) (the automatic stay
does prohibit considering such motions); Ayati-Ghaffari
v. J.P. Morgan Chase Bank, N.A., 2018 WL 6737415 (E.D.
Tex. 2018) (same).