We heard the other day from attorneys involved in the MDL direct filing, choice-of-law case that we wrote about a couple of weeks ago, Looper v. Cook Inc. Engaging in this kind of dialogue is one of the joys of blogging, even when our friends and colleagues write to tell us we got something wrong. To err is human, to blog is divine . . . or something like that. Anyway, to the point, we reported to you that the district court in the Cook vein filter MDL had ruled that the defendants had waived their Lexecon rights by acquiescing to direct filing of complaints in the MDL. It turns out it was the plaintiffs who lacked Lexecon rights—not the defendants, who did not object to trials in the MDL. In our own defense, the Seventh Circuit’s opinion said “parties,” and our defense-centric minds defaulted to “defendants.” Lesson learned. We also should emphasize that the Seventh Circuit expressly withheld judgment on the parties’ Lexecon rights; only the district court found a waiver.
Our overall points still hold true. Direct filing of complaints in multidistrict litigation poses risks on jurisdiction, venue, and choice of law that all parties—on both sides of the v—should weigh against the benefits.
Rules governing choice of law especially should not be controversial, which brings us to a more recent case that shows how choice-of-law rules are supposed to work. In Bond v. Johnson & Johnson, No. 21-05327, 2021 U.S. Dist. LEXIS 243038 (D.N.J. Dec. 21, 2021), the plaintiffs sued after treatment with the defendants’ surgical mesh, but instead of filing in their home states of Michigan and North Carolina, they filed in the defendants’ home state of New Jersey. Id. at *1-*2. Should plaintiffs be able to avoid the laws of the states where they reside and underwent their surgeries merely by suing somewhere else?
That is what choice-of-law rules are meant to address, and unlike the Seventh Circuit in Looper v. Cook, the district court in Bond did not overthink it. The Seventh Circuit jumped through multiple hoops to apply choice-of-law rules from jurisdictions where the civil actions at issue had never been. By comparison, the district court in Bond followed the standard rules and applied the choice-of-law rules for the jurisdiction where the case was initially filed: “Because ‘[t]his diversity action was initiated in the United States District Court for the District of New Jersey,’ the Court must apply New Jersey’s choice of law rules.” Id. at *10.
New Jersey’s choice-of-law rules apply a strong presumption in favor of the law of the states where the plaintiffs incurred their injuries. These plaintiffs resided in Michigan and North Carolina, and they had their surgeries there, which created a strong presumption that the substantive law of their home states should apply. Moreover, factors related to the defendants’ places of business and product design in New Jersey did not outweigh that presumption. Id. at *15-*21.
The district court therefore applied the substantive laws of Michigan and North Carolina, and the applicable law made a difference to the outcomes for these two plaintiffs. (Their names, by the way, were Bond and Rosebush. McConnell would surely find an Agent 007 reference for this pair, but we are not as clever.)
For the Michigander, “Michigan does not accept strict liability as the basis for a [products liability] claim,” so those claims went by the board with prejudice. The district court dismissed the plaintiff’s warranty claims too because the plaintiff failed to allege that he provided pre-suit notice “upon discovering a breach,” which Michigan law requires. Id. at *45-*48. The district court analyzed the plaintiff’s allegations of design defect, manufacturing defect, and warnings defect under the plaintiff’s negligence claim, which Michigan law does recognize. Id. at *22-*35. The plaintiff, however, failed to allege facts establishing a defect under any of these theories, resulting in negligence being dismissed without prejudice. Id.
For the North Carolinian, the analysis was more straightforward, as was the result—all claims dismissed with prejudice. North Carolina “does not recognize strict liability in tort in product liability actions.” Id. at *14-*15. It is similar to Michigan in that regard, which explains a lot about why these plaintiffs sought to avoid those jurisdictions and why the defendants moved for summary judgment with regard to these plaintiffs.
The kicker, however, was North Carolina’s six-year statute of repose. Statutes of repose are treated as substantive law for choice-of-law purposes, and if you have not checked out our 50-state survey on statutes of repose, you can find it here. In short, a statute of repose limits the time within which an action may be brought, but it is entirely unrelated to the accrual of a cause of action. It can bar a cause of action even before it has accrued.
North Carolina has a six-year statute of repose for personal injury actions arising from an alleged product defect, and the six-year period runs from the “the date of initial purchase for use or consumption.” Id. at *36. For this North Carolina plaintiff, that was the date of his mesh implantation surgery, and he filed his personal injury lawsuit more than six years later. Id. at *38-*39. Too late. All claims dismissed. Goodbye, Mr. Bond. We give a shout out to David Johnson at Butler Snow for bringing Bond v. J&J to our attention.