We will never forget our first removal under the Class Action Fairness Act. It was circa 2006, shortly after President Bush signed CAFA into law, when we received word of a complaint against our client filed in California state court with more than 100 plaintiffs claiming injuries from the same prescription drug. Aha! A removable mass action, we thought. And before we knew it, we had the case in federal court under CAFA jurisdiction, poised to be transferred into a distant MDL. After all, the plaintiffs were almost all litigation tourists with no connection whatsoever to the Golden State.
Careful readers have already discerned the end to this story. Mass actions removed under CAFA may not be transferred to an MDL under the MDL statute (28 U.S.C. § 1407) unless a majority of the plaintiffs request the transfer. See 28 U.S.C. § 1332(d)(11)(C)(i). No such a request was forthcoming in our case. In the words of our favorite post-modern philosopher, Homer J. Simpson, “D’oh!” We and our more-than-100 adversaries remained in California, a beautiful place to be for many reasons, but not the proper forum for these non-California plaintiffs and their lawyers.
Since those early days, we have come across two ways to transfer a CAFA mass action to an MDL, notwithstanding CAFA’s prohibition on section 1407 transfers. The first is to state an alternate basis for removal jurisdiction, such as federal question jurisdiction or diversity jurisdiction based on fraudulent joinder or misjoinder. The JPML has permitted transfer of CAFA mass actions to multidistrict litigation, so long as CAFA is not the only basis for removal jurisdiction. The most-cited example comes from the Darvocet MDL. See In re Darvocet, Darvon and Propoxyphene Prods. Liab. Litig., 939 F. Supp. 2d 1376 (J.P.M.L 2013) (“Section 1332(d)(11)(C)(i) does not prohibit Section 1407 transfer of an action removed pursuant to CAFA’s mass action provision so long as another ground for removal is asserted.”).
The second method is to seek transfer not under section 1407, but instead under 28 U.S.C § 1404, the general venue transfer statute. This strategy also comes out of the Darvocet litigation, Romo v. McKesson Corp., No. ED 12-2036, 2015 WL 3622620 (C.D. Cal. June 9, 2015), and all we can say is that we wish we had thought of it ourselves. We have written before
on Romo in connection with the Ninth Circuit’s opinion holding that hundreds of claims related to one prescription drug constituted a CAFA mass action, even though counsel tried strategically to evade federal jurisdiction by dividing the plaintiffs into multiple civil actions of slightly under 100 plaintiffs each.
We lauded that ruling as reasoned and correct, and we like the recent transfer ruling, too. In Romo, the defendants achieved their objective of federal jurisdiction, but like us back in 2006, they were still stuck in California with mainly non-California plaintiffs against non-California defendants. Romo v. McKesson Corp., No. ED 12-2036, 2015 WL 3622620 (C.D. Cal. June 9, 2015). So they moved to transfer the case under section 1404 to the more convenient forum of the Eastern District of Kentucky, where the Darvocet MDL is proceeding. The location of the MDL is not a coincidence—one of the drug manufacturers maintains its principal place of business there.
The district court granted the motion, ruling first that there is no legal prohibition on transferring CAFA mass actions under section 1404. Id. at **2-3. The prohibition on mass action venue transfer applies only to transfers under the MDL statute, section 1407. Id. at *3. And Lexecon did not impede a transfer under section 1404 either. In Lexecon, the Supreme Court held that an MDL judge cannot use section 1404 to transfer an MDL’d case to itself for trial because section 1407 says that MDL transfer is for pretrial purposes only. Lexecon v. Milberg Weiss etc., 523 U.S. 26, 37-38 (1998). That is not what was going on in Romo. Id. The district court also rejected the plaintiffs’ argument that a majority of them had to consent to the transfer, noting only that “Plaintiffs fail to persuade the Court that such prohibition applies to a venue transfer under § 1404.” Id.
Having concluded that section 1404 granted it the discretion to transfer the case, the district court also concluded that the case should proceed in the Eastern District of Kentucky. First, the district court rejected the idea that the plaintiffs’ choice of forum was entitled to deference, observing that
not all Plaintiffs are citizens of California and they have failed to identify any operative facts that occurred in California. Plaintiffs aver that “more than 10% of the Plaintiffs are California residents and Defendant McKesson is a California resident.” These facts, without more, do nothing to convince the Court that it should defer to Plaintiffs’ choice of forum. Furthermore, the Court gives Plaintiffs’ choice of forum less deference because it is a mass action with Plaintiffs from all over the country.
Id. at *4. You should go back and read the block quote again because it describes any number of cases that we have seen, without even changing the names. It is a very useful quote, to which we say “amen.”
Other factors weighing in favor of transfer were the efficiency offered by an experienced and knowledgeable MDL judge, the existence of prior rulings in the MDL “that likely touch” on the transferred cases, the relatively congested state of the local docket, and the public policy of California, which disfavors hosting non-Californians. Id. at **4-5. As the court stated, “If all Plaintiffs . . . were citizens of California, the Court would have a greater interest in adjudicating these claims,” but because they were not, “public policy does not support keeping the cases in California.” Id. at *5. To which we say, “double amen.”
One byproduct of this strategy is that the transfer is for all purposes, not just pretrial proceedings. In addition, although these cases will end up in an MDL, we see no reason why the Court’s reasoning would not apply to any motion to transfer venue to the defendant’s home state. Some of the factors will not weigh as strongly in favor of a transfer—for example, efficiency arguments may not be as strong where there is no experienced MDL judge in the waiting. But the core rationale still holds true: Measures are available and should be taken to discourage plaintiffs from filing in forums with no arguable connection to their controversies. In that regard, the Romo order is a strike at the litigation tourism that we so dislike, and we are pleased that the order is so direct in so ruling.