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The passage of time can change our collective perception of what is normal and accepted.  By way of a somewhat contrived example, back in 1989, there was a popular cross-over rap song called “Just a Friend” by Biz Markie.  It was catchy, entertaining, and a contrast to so-called “gangsta rap” that scared the Parents Music Resource Center and others.  In one lyric, the protagonist declares “Oh, snap” when he sees his paramour osculating another male the protagonist had been led to believe was “just a friend.”  Yes, gentle reader, this was an expression used back in the day.  And, yes, this was a popular song, not just a karaoke staple of the emergent arthritis set.  Today, a similar scene in a popular song might describe the protagonist’s reaction as being violent or at least profane.

A decade after “Just a Friend” was released, the Supreme Court issued its decision in Murphy Bros., Inc. v. Michetti Pipe Stringing, Inc., 526 U.S. 344 (1999).  The issue in Murphy Bros. was whether a notice of removal was filed too late.  In answering that the time for removal starts with formal service, not with earlier informal receipt of the complaint, the stage was set for the rise of snap removals.  Also referred to as wrinkle removals, the epithet “snap” refers to how quickly the notice of removal is filed before service can be accomplished.  Before Murphy Bros., courts had generally held that the application of the forum defendant rule’s bar on removal should not depend on the timing of service.  See, e.g., Hunter Douglas Inc. v. Sheet Metal Workers Intern Ass’n Local 159, 714 F.2d 342, 345 (4th Cir. 1983); Pecherski v. General Motors Corp., 636 F.2d 1156, 1160–61 (8th Cir. 1981).  Within a few years of Murphy Bros., we started seeing district courts reject motions to remand brought in cases removed before any in-state defendant had been served.  Other district courts rejected snap removal, at least in some situations, often based on the reasoning that it was not fair for defendants to watch dockets and remove cases that would not have been removable had they learned of the case by being served.  For us, focused as we are on litigation against drug and device manufacturers, concerns about gamesmanship and the use of technology by defendants are ironic.  Plaintiffs engage in all manner of gamesmanship to try to keep cases out of federal court.  The timing of filing and serving cases is often strategic.  Once litigation starts, technology is generally a vehicle for increasing the burden on defendants.  Setting aside the scales for weighing the gamesmanship by both sides of the v., however, the language of 18 U.S.C. § 1441(b)(2) is not subject to serious debate.

By now, more than twenty-five years after Murphy Bros., every circuit court to directly address the propriety of snap removal has held that the forum defendant rule—barring removal “if any of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought”—does not apply when no forum defendant has yet been served.  Among those circuits is the Third Circuit, which covers Delaware, New Jersey, Pennsylvania, and the U.S. Virgin Islands, states that collectively serve as the home—principal place of business or state of incorporation—for many drug, device, and other companies targeted in serial product liability litigation.  Grossly overgeneralizing, the plaintiff lawyers who sue these companies prefer to do so in their home state courts rather than federal courts and the companies prefer federal courts.  So, the decision Encompass Ins. Co. v. Stone Mansion Rest., Inc., 902 F.3d 147, 152 (3d Cir. 2018), which endorsed snap removal as the unambiguous reading of § 1441(b)(2), comes up fairly often. 

In Higgins v. Novartis Pharms. Corp., C.A. No. 25-247 (MN), 2025 WL 1397045 (D. Del. May 14, 2025), we have such a straightforward application of snap removal that we took notice of how things have changed.  Plaintiffs chose Delaware state court for their product liability case against a drug company that has its principal place of business in New Jersey and its state of incorporation in Delaware.  This is also a change:  Delaware used to not be a preferred destination for product liability plaintiffs; historically, its state courts were hailed as savvy and business-friendly.  In Higgins, plaintiff named a bunch of John Doe defendants along with the drug company, which removed the case before it or any fictitious defendants were served.  Not that fictitious defendants count for removal under § 1441(b)(1) anyway.  Citing Encompass and Avenatti v. Fox News Network LLC, 411 F.4th 125, 128 n.1 (3d Cir. 2022), Higgins concluded that the manufacturer had “properly removed this action in accordance with the plain language of § 1441(b)(2).”  2025 WL 1397045, *2.  By contrast.

Plaintiffs’ policy appeals regarding the technological advantages of electronic dockets and resulting overuse of snap removal by defendants are unavailing in the face of clear statutory text.  It is for Congress, not this Court, to revise the statute.

Id.

And that was it.  No big analysis or survey of caselaw was required.  In the circuit where so many drug and device companies are at home for purposes of general personal jurisdiction, snap removal is undoubtedly permissible.  In other words, Higgins has got what we need when it comes to snap removal.

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This post is from the non-Reed Smith side of the blog.

Not a drug or a device case, the recent personal jurisdiction ruling in In re: Hair Relaxer Marketing Sales Practices and Products Liability Litigation, 2025 WL 1331791 (N.D. Ill. May 7, 2025), caught our attention because typically the Seventh Circuit is not a very favorable place to be from a corporate personal jurisdiction standpoint. And coming shortly after the disappointing Ninth Circuit foreign defendant personal jurisdiction ruling, we thought we could use some good news on this topic.  In re Hair Relaxer delivers, making it a nice checklist for avoiding foreign parent jurisdiction even in a difficult forum.

In re: Hair Relaxer involves claims against the manufacturers of various hair relaxer products, including L’Oréal USA.  As is sometimes the case in MDLs, you get a rogue plaintiff. Here, that rogue plaintiff added L’Oréal USA’s French parent company, L’Oréal S.A. as a defendant.  Id. at *1-2.  On the parent defendant’s motion to dismiss, the question before the court was whether plaintiff’s allegations demonstrated that the court had specific jurisdiction over the foreign company.  Specific jurisdiction hinges on the defendant having contacts with the forum state that show it purposefully availed itself or purposefully directed activities at the state and that plaintiff’s alleged injury arose from the forum-related activities.  Id. at *3. 

Plaintiff argued that personal jurisdiction was established under the stream-of-commerce doctrine—which allows the exercise of jurisdiction over a foreign corporation if it “delivers its products into the stream of commerce with the expectation that they will be purchased by consumers in the forum state.” Id. (quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297-98 (1980)).  However, ever since Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017), we have considered the door at least partially closed on stream-of-commerce jurisdiction.  The Third Circuit, for example, does not recognize it at all.  See Shuker v. Smith & Nephew, PLC, 885 F.3d 760 (3d Cir. 2018) (noting that a plurality of the Supreme Court has twice rejected the theory). But it’s still alive and kicking in the Seventh Circuit.

In fact, the Seventh Circuit has adopted a broad, knowledge-based stream-of-commerce doctrine whereby “as long as a participant in the stream of commerce is aware that the final product is being marketed in the forum state, the possibility of a lawsuit there cannot come as a surprise.”  In re Hair Relaxer, at *3.  Moreover, stream-of-commerce jurisdiction applies to non-manufacturing parent companies when parents “significantly contribute” to the placement of the product in the stream-of-commerce. Clearly the Seventh Circuit does not make it easy on foreign defendants. But even with the weight of the law on plaintiff’s side, the court found her allegations severely lacking.

Plaintiff’s allegations that the foreign parent itself placed the products into the stream of commerce were unsupported and conclusory. The foreign parent submitted a declaration to the contrary that plaintiff did not rebut.  Id. at *4. So, plaintiff’s primary argument was that the parent company placed the products into the stream of commerce “through control of the actions of its subsidiaries.” Id. 

First, plaintiff attempted to attribute statements in L’Oréal Groupe’s annual report and investor website to L’Oréal S.A.  But none of the statements specifically were about L’Oréal S.A. itself as opposed to one of its subsidiaries.  Id. at *5.  Rather, L’Oréal Groupe refers to all of the entities and brands under the corporate umbrella.  That is not enough for personal jurisdiction.  Nor does the fact that the parent company owned the products’ formulas or held U.S. patents for the products or licensed the products to its U.S. subsidiary establish that the products at issue in the litigation were actually the parent’s products. Id. The existence of a licensing arrangement is not enough alone to establish jurisdiction; the question is the degree of control exercised by the licensor or parent. 

Try as she might, plaintiff could not demonstrate the type of pervasive control needed to disregard corporate separateness.  Overlapping board members are common, as is a parent maintaining some financial records regarding its subsidiaries or sharing infrastructure like an intranet site.  Id. at *6. That fact that the U.S. subsidiary’s website is a page on the L’Oréal Groupe’s website was not only irrelevant to the level of control exercised by L’Oréal S.A., but “simply running a website that is accessible in all 50 states is not enough to create the ‘minimum contacts’ necessary to establish personal jurisdiction in the forum state.  Id. Take that Ninth Circuit. 

The court also found the parent company’s involvement in the litigation irrelevant to the jurisdictional question.  While the court had previously found the parent and subsidiary had a close relationship such that the parent was required to produce documents, the standard for establishing “control” for purposes of discovery “is much lower than the standard for establishing an alter-ego relationship.”  Id. at *7.  And then plaintiff got desperate.  She argued that the parent’s issuing of a press release about the MDL was evidence of control.  It’s not and moreover, the press release was issued by L’Oréal Groupe, not L’Oréal S.A. 

The court concluded that the two entities operate separately and independently and that the parent does not control the day-to-day operations of the subsidiary.  Therefore, plaintiff failed to demonstrate sufficient minimum contacts to warrant exercising jurisdiction over the foreign parent or even to state a colorable claim to warrant jurisdictional discovery. 

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Bexis knows that cases like Daughtry v. Silver Fern Chemical, Inc., 2025 U.S. App. LEXIS 11431, 2025 WL 1364806 (5th Cir. May 12, 2025), hit our sweet spot.  It is a civil case, but it also emits a whiff of criminal law. It purports to be, among other things, a product liability case, but it turns out that it isn’t. And even the nature of the product is hazy. Is it a drug or is it a chemical?  Either way, the case was dismissed.  

Daughtry is a half drug/half chemical decision involving allegations of unusual personal injury.  The chemical was an industrial solvent with various innocuous uses. But the chemical could also be used as a date-rape drug.  Maybe it is both a drug and a chemical.  Call it Schrodinger’s product. 

The Drug Enforcement Administration (DEA) investigated the defendant company, which had been selling the drug/chemical to the plaintiffs’ employer.  In response to a government subpoena, the defendant company turned over records, including invoices, purchase agreements, safety data sheets, and emails between the defendant and the plaintiffs. The DEA relied upon those documents to prosecute the plaintiffs for controlled substances offenses. The government seized assets of the plaintiffs. Some of the plaintiffs pleaded guilty. End of story. 

Except that was not the end of the story.  The plaintiffs claimed that they later found out that the defendant company and some of its employees had altered the documents produced to the government. (There were different versions of the story as to how the plaintiffs discovered that documents had been doctored, and the appellate court seemed a bit skeptical.) The plaintiffs claimed that the defendants altered the emails to help the government’s criminal and civil cases against the plaintiffs, that the defendants were in fact covering up their own tracks, and that it was the defendants, not the plaintiffs, who failed to operate according to the appropriate standards. According to the plaintiffs, the government relied upon the phony documents, especially the safety data sheet, to show that the plaintiffs were not employing voluntary industry practices.  

You would think that the altered documents would form the basis of some sort of effort to obtain post-conviction relief, perhaps undoing the convictions.  That is usually a long shot. But what the Daughtry case concerns is the plaintiffs’ civil claim against the defendants for defrauding them, for product liability failure to warn, negligent misrepresentation, constructive fraud, and civil conspiracy.  The injury alleged was the litigation against the government and the guilty pleas. On its face, that theory sounds screwy. Then again, a criminal conviction probably is worse than most of the specious injuries we see alleged in the mass tort cases that clog our files. 

The trial court dismissed the case on both substantive grounds and for lack of personal jurisdiction against one of the individual defendants.  The appeal went up to the Fifth Circuit, which has become far and away the most fascinating of all the circuit courts.  If the next SCOTUS nominee is not from the Fifth Circuit, we’ll eat a big, fat Texas bug. 

The Fifth Circuit disagreed with the district court’s holding that specific personal jurisdiction was lacking against one of the defendants. Seeking to induce a criminal prosecution against Texans connected the defendants to Texas, so there was personal jurisdiction.  If that is a holding you end up using some day, your practice is far more interesting than ours.  (This case will be a published, precedential decision.)

The most pertinent part of the Daughtry case for purposes of our little blog is the dismissal of the plaintiffs’ cause of action for product liability. The product liability claim was based on the defendant’s alleged failure to attach a government-mandated date-rape warning label to the product it sold to plaintiffs.  That was also the subject of the email doctoring.  But the injuries the plaintiffs claimed related to the government’s prosecution for their own unlawful distribution of the product as a drug, not to the risk mentioned in the missing label.  Those injuries did not stem from any defect in the product’s warnings. 

The court rejected the plaintiffs’ fraud claim because the plaintiffs were not the defrauded parties.  They weren’t the ones who relied upon the allegedly doctored documents. It was the government that relied on the documents (though such reliance was to the plaintiffs’ detriment). 

Nor could the plaintiffs assert a negligent undertaking claim under Rest. (Second) of Torts sections 323 or 324Aconcerning the missing label.  Recovery for negligent undertaking is limited to physical harm.  None of the plaintiff’s alleged harms was physical, but rather related to the government’s raids, seizures, and their monetary consequences. 

It is possible that the plaintiffs had a legitimate beef against the defendants. But their causes of actions were the wrong ones. 

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We reported about a year and a half ago on a Ninth Circuit opinion holding that the First Amendment prohibited cancer warnings required by California’s Proposition 65 because the warnings were government-compelled speech.  Because there was no scientific consensus that the product at issue (glyphosate) causes cancer, the compelled warning failed intermediate scrutiny and thus violated the Constitution.  You know about Prop 65.  It is the voter-enacted law that requires businesses to warn Californians about significant exposures to chemicals that allegedly cause cancer or birth defects.  See Cal. H&S Code § 25249.5 et seq.  The result is that California is now blanketed with boilerplate warnings of chemicals “known to the state” to cause cancer that literally no one pays any attention to. 

This was not the first time the Ninth Circuit ruled that the First Amendment trumps Prop 65.  You might recall the court order circa 2018 requiring Starbucks and other coffee shops to warn California consumers that drinking coffee poses a risk of cancer because it contains dietary acrylamide.  The problem with that warning is that it is not true.  Dietary acrylamide forms naturally in many foods when prepared at high temperatures, and epidemiological studies are inconclusive on whether it is carcinogenic.  One epidemiologist who reviewed the literature has concluded there are no studies showing that eating food with acrylamide increases the risk of cancer at all. 

The California Chamber of Commerce thus stepped in and sued to enjoin the State from compelling businesses to disparage their own products with alarmist warnings that have no factual support.  Long story short, the Chamber won, and the Ninth Circuit affirmed a preliminary injunction preventing the State from enforcing Prop 65.  See our post on the opinion here. 

So we have the Ninth Circuit holding that unsupported Prop 65 cancer warnings violate the First Amendment.  Twice.  Including in a case specifically involving dietary acrylamide.  And what then did the great State of California do?

It doubled down. 

Instead of turning its attention to matters that might actually harm Californians, the State promulgated a new regulation effective January 1, 2025, specifically requiring a Prop 65 cancer warning for dietary acrylamide. 

And the State lost again.  On remand from the Ninth Circuit, the district court has now permanently enjoined the State from enforcing its new regulation.  In California Chamber of Commerce v. Bonta, No. 2:19-cv-02019, 2025 U.S. Dist. LEXIS 84289 (E.D. Cal. May 2, 2025), the district court explained that the carcinogenic risk of dietary acrylamide has been the subject of debate since its discovery in 2002.  The court acknowledged animal studies showing that mice and rats develop tumors when they eat food containing acrylamide.  But, “as [the] court has previously acknowledged, the implications of these animal studies and mechanistic data for assessing dietary acrylamide’s cancer risk are uncertain.”  Id. at *9-*11 (emphasis in original).  The FDA stated in 2024 that it is “not clear exactly what risk acrylamide poses to humans,” and as noted above, epidemiological studies have been inconclusive.  Id. at *12-*14. 

The district court first rejected the State’s argument that the Chamber failed to show that any of its members were compelled to provide a warning because it did not provide evidence that their food products contain acrylamide.  That was beside the point.  Businesses in California are under “constant, credible threat of enforcement” of Prop 65 because the statute makes it “absurdly easy” to bring a private action.  A private plaintiff “need only credibly allege that a product has some of the chemical at issue, not that the amount . . . is harmful or exceeds [the designated] level.”  Id. at *22-*24.  The Chamber also provided evidence of hundreds of private enforcement actions alleging the presence of acrylamide, which shows how Prop 65 really works.  Id at *25.  The Chamber and its members definitely had standing. 

On the merits, the district court ruled that the State’s new regulation was unconstitutional under Supreme Court precedent on the First Amendment—Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (1985), and Central Hudson Gas & Electric Corp. v. Public Service Commission, 447 U.S. 557 (1980).  Under the less-stringent Zauderer test, the government can compel speech so long as it is reasonably related to a substantial governmental interest and the compelled speech is (1) purely factual, (2) noncontroversial, and (3) not unjustified or unduly burdensome.  The district court found that the Prop 65 warnings were “neither uncontroversial nor purely factual as the warnings espouse a one-sided view that dietary acrylamide poses a human cancer risk despite a lack of scientific consensus on that point.”  Id. at *28.  The State argued that its newly formulated acrylamide warning strung together statements that were factually true.  But the State was ignoring “the reality that [the warning] conveys the ‘core message’ that consumer a food containing acrylamide poses a risk of cancer.”  Id. at *36-*37. 

The new regulation failed under Central Hudson, too.  Under Central Hudson’s intermediate scrutiny standard, the Prop 65 dietary acrylamide warning must “directly advance the governmental interest asserted and must not be more extensive than is necessary to serve that interest.”  Id. at *41.  California clearly has an interest in protecting the public from health hazards.  “However, misleading statements about acrylamide’s carcinogenicity do not directly advance that interest.”  Id. at *42.  Moreover, California has other means available to inform consumers of its opinion that acrylamide in food can cause cancer without burdening the free speech of businesses, including advertising and posting information on the Internet. 

The district court therefore granted the Chamber’s request for declaratory relief and a permanent injunction against enforcement of the Prop 65 acrylamide regulation.  The State may or may not appeal.  Or maybe a private enforcement organization (i.e., the plaintiffs’ bar) will intervene and appeal, which is what happened last time.  We don’t know why the State doubled down on its unsupported and anything-but-noncontroversial acrylamide Prop 65 warning.  But being the defense hacks that we are, we can’t help but see the influence of private enforcers trying to protect a profit center.  Part of us would like to see another appeal, and a third opinion from the Ninth Circuit holding that the First Amendment trumps Prop 65. 

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MDLs are supposed to follow the Federal Rules of Civil Procedure.  That’s the reminder the Sixth Circuit gave in In re National Prescription Opiate Litigation, 956 F.3d 838, 844 (6th Cir. 2020):

[T]he law governs an MDL court’s decisions just as it does a court’s decisions in any other case. . . .  Here, the relevant law takes the form of the Federal Rules of Civil Procedure.  Promulgated pursuant to the Rules Enabling Act, those Rules are binding upon court and parties alike, with fully the force of law. . . .  Respectfully, the district court’s mistake was to think it had authority to disregard the Rules’ requirements . . . in favor of enhancing the efficiency of the MDL as a whole. . . .  But MDLs are not some kind of judicial border country, where the rules are few and the law rarely makes an appearance.  For neither §1407 nor Rule 1 remotely suggests that, whereas the Rules are law in individual cases, they are merely hortatory in MDL ones.

Id. at  844 (citations omitted).  More recently the Civil Rules Committee made the same point in approving new Fed. R. Civ. P. 16.1:  “The Rules of Civil Procedure, including the pleading rules, continue to apply in all MDL proceedings.”  Comment to Rule 16.1(b)(3)(A).

Bad things happen – usually to defendants – when an MDL adopts practices designed to cut procedural corners that the drafters of the rules put there for a reason.

Continue Reading MDL Procedural Shortcuts Once Again Disadvantage Defendants
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When we read the word “Georgia”, we hear it in our heads sung in the voice of the great Ray Charles.  Actually, we hear the entirety of the opening lyrics to Georgia on My Mind.  Is that just us?  Ok, well, anyhoo.

We have been reading a lot about Georgia of late because of last month’s enactment of tort reform, in the form of Georgia Senate Bill 68 (a no-name Act) and Georgia Senate Bill 69 (the “Georgia Courts Access and Consumer Protection Act”), signed by Georgia’s Governor on April 21, 2025.  There is a lot for a medical device and pharmaceutical product liability lawyer to like.

The civil litigation procedural changes wrought by these bills include:

  • Trifurcation of Liability and Damages:  Senate Bill 68, Section 8 took effect with the Governor’s signature and applies to pending actions.  It added O.C.G.A. § 51-12-15, which allows any party in an action for bodily injury or wrongful death with more than $150,000 at issue to demand furcation of liability and damages.  The initial, liability phase includes apportionment of fault, if any.  The second phase, if necessary, goes to the same judge and jury, and determines compensatory damages.  Then a third phase (again to the same judge and jury), if necessary, determines issues like punitive damages, attorneys’ fees, or costs that may be at issue. 
  • Non-economic damages:  Senate Bill 68, Section 1 replaced O.C.G.A. § 9-10-184, which now prohibits counsel from putting a number on non-economic damages until “after the close of evidence and at the time of [plaintiff’s] first opportunity to argue the issue of damages.”  In addition, the non-economic damage request must be “rationally related to the evidence of noneconomic damages.”  This one also took immediate effect and applies to pending actions.
  • Recoverable medical expenses:  Senate Bill 68, Section 7 added O.C.G.A. § 51-12-1.1. For causes of action arising on or after April 21, 2025, this section  limits recoverable damages for “medical and healthcare expenses” to their “reasonable value,” which is to be determined with reference to the amount paid for those services, not just the amount billed. 
  • Discovery about litigation-related medical care: Newly-added O.C.G.A. § 51-12-1.1 also makes “relevant and discoverable” information about whether medical care has been provided under a “letter of protection” or other arrangement where payment to the provider will be made out of a judgment or settlement.  The relevant and discoverable information includes who referred the plaintiff to that provider and the terms of that agreement, as well as information about any sale of the resulting accounts receivable.  This provision only applies to “causes of action arising on or after the effective date of the Act”, namely April 21, 2025.
  • Discovery of litigation financing agreements:  Senate Bill 69, Section 4 amended O.C.G.A. § 9-11-26 to add a new provision making discoverable “the existence and terms and conditions of any litigation financing agreement” for more than $25,000.  Mere disclosure of a litigation funding agreement does not make that agreement admissible at trial…but at the same time, the subsection is not to be construed “to limit the admissibility of such information as evidence of a party’s claim or defense.”  This section became effective upon the Governor’s approval, but only applies to “causes of action commenced” or litigation funding “contracts entered into” on or after April 21, 2025.

The Georgia Courts Access and Consumer Protection Act contains even more important new laws, as it imposes substantial and comprehensive regulation of third-party litigation funding/financing in the form of the newly-created O.C.G.A. Title 7, Chapter 10, mostly effective as of January 1, 2026.

First up are the definitions, including what litigation financing is: 

‘Litigation financing agreement’ or ‘litigation financing’ means an agreement in which a litigation financier agrees to provide financing to a consumer or entity that is or has standing to become a party to a civil action, administrative proceeding, legal claim, or other legal proceeding seeking to recover monetary damages, or to counsel for such consumer or entity, in exchange for a right to receive payment, which right is contingent in any respect on the outcome of such action, claim, or proceedings by settlement, judgment, or otherwise, or on the outcome of any matter within a portfolio that includes such action, claim, or proceedings and involves the same legal representative or affiliated representative.

O.C.G.A. § 7-10-1(10)(A).

Next, O.C.G.A. § 7-10-2 requires any person “engage[d]in litigation financing in [Georgia]” to register as a “litigation financier”.  If an entity is engaged in litigation funding, it must disclose “each person that directly or indirectly owns, controls, holds with the power to vote, or holds proxies representing 10 percent or more of the voting shares” of the entity, including identifying information and whether such persons have any criminal convictions within the past 10 years for anything other than a misdemeanor traffic violation.  Litigation financiers cannot be registered if they are associated with foreign governments, entities, or persons designated by the United States as foreign adversaries.  Then O.C.G.A. § 7-10-9 makes violation of these registration requirements a felony punishable by up to 5 years in prison and/or a $10,000 fine.  That is a requirement with some teeth!

More of the real substance comes in O.C.G.A. § 7-10-4, which explains what a litigation financier “shall not” do—including exercise control over the proceedings or any settlement, or obtain payment greater than what the plaintiff recovers after fees and costs:

A litigation financier shall not:

(1) Direct, or make any decisions with respect to, the course of any civil action, administrative proceeding, legal claim, or other legal proceeding for which such litigation financier has provided litigation financing, or any settlement or other disposition thereof

* * *

(2) Contract for, receive, or recover, whether directly or indirectly, any amount greater than an amount equal to the share of the proceeds collectively recovered by the plaintiffs or claimants in a civil action, administrative proceeding, legal claim, or other legal proceeding seeking to recover monetary damages financed by a litigation financing agreement after the payment of any attorney’s fees and costs owed in connection to such action, claim, or proceedings.

Other limitations in the Georgia Courts Access and Consumer Protection Act include prohibitions on litigation financiers paying or accepting referral fees, engaging in false advertising, or seeking or obtaining waivers of remedies from those using their litigation financing services. 

Still other provisions preclude litigation financiers from requiring consumers of their services to use specific providers of goods and services (such as, for example, particular plaintiff’s lawyers that the litigation financier prefers); prevent those involved in the litigation (like the plaintiff’s lawyers) from having a financial interest in the litigation financier; and preclude the assignment or securitization of most litigation financing agreements, among other restrictions.

Litigation financing agreements in Georgia also will require specific disclosures in 14 point bold type:

IMPORTANT DISCLOSURES — PLEASE READ CAREFULLY 

1. Right to Cancellation: You, the consumer, or your legal representative may cancel this litigation financing agreement without penalty or further obligation within five (5) business days from the date you sign this contract or the date you receive financing from the litigation financier, whichever date is later. You or your legal representative may cancel this litigation financing agreement by sending a notice of cancellation to the litigation financier and returning to the litigation financier any funds received from the litigation financier at the litigation financier’s preferred mailing address set forth on page 1 of this contract.

2. The maximum amount the litigation financier may receive or recover from any contingent payment provided for in this litigation financing agreement shall be no more than an amount equal to the share of the proceeds collectively recovered by the plaintiffs or claimants in a civil action, administrative proceeding, legal claim,or other legal proceeding seeking to recover monetary damages financed by this litigation financing agreement after the payment of any attorney’s fees and costs owed in connection to such action, claim, or proceedings.

3. The litigation financier agrees that it has no right to, and will not demand, request, receive, or exercise any right to, influence, affect, or otherwise make any decision in the handling, conduct, administration, litigation, settlement, or resolution of your civil action, administrative proceeding, legal claim, other legal proceeding. All of these rights remain solely with you and your legal representative.

4. You, the consumer, are not required by the terms of this litigation financing agreement to continue to be represented by any particular legal representative, and the litigation financing agreement does not include any right for the litigation financier, any legal representative, or any other person to claim or seek to recover any assessment, charge, fee, penalty, or damages of any kind if you elect to change legal representatives at any time.

5. If there is no recovery of any money from your civil action, administrative proceeding, legal claim, or other legal proceeding, or if there is not enough money to satisfy in full the portion assigned to the litigation financier, you will not owe anything in excess of your recovery.

6. You are entitled to a fully completed litigation financing contract with no material terms or conditions omitted prior to signing. Before signing the litigation financing contract, or authorizing anyone to sign it on your behalf, you should read the contract completely and consult an attorney.

O.C.G.A. § 7-10-6

But that’s not all:  O.C.G.A. § 7-10-5 puts litigation financiers providing more than $25,000 in funding on the hook for any costs or monetary sanctions for frivolous litigation, and requires litigation financiers to indemnify funded plaintiffs and claimants for “any adverse costs, attorney’s fees, damages, or sanctions that may be ordered or awarded against such persons in such action.” Again, this new law has some teeth!

Litigation funding, particularly in personal injury matters, gets talked about some, but action is harder to come by. For example, the Advisory Committee on Civil Rules (to the Judicial Conference’s Committee on Rules of Practice and Procedure) has been contemplating whether some litigation funding measure is needed at the federal level, and if so, whether a new federal rule of civil procedure requiring disclosure of litigation funding is the right solution. (See, for example, the Committee’s October 2024 Agenda Book at 417-83, and correspondence from LCJ and the U.S. Chamber in support of such a federal rule.)

Georgia’s two pronged approach (regulation of litigation funders and litigation funding contracts, and disclosure in the form of the new O.C.G.A. § 9-11-26, which allows for discovery into litigation funding) obviously goes further than the disclosure-only solutions usually proposed. Indeed, because the regulatory aspects of the new Georgia law apply to anyone in Georgia engaged in litigation funding and any litigation funding contracts in Georgia, those regulatory provisions will apply regardless of whether a case is pending in state or federal court in Georgia.

All in all, some big changes, and the third party litigation funding provisions put Georgia out in the lead on this issue.

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Prologue: Many years ago, our litigation practice included representation of a couple of film studios.  While it was fun to visit backlots and (literally) bump into movie stars, we discovered that discovery, research, and motion practice were not necessarily any more exciting due to involvement of above-the-line talent. Contract law is still contract law, even if the contract was written on a napkin and bears the signature of an Oscar winner.  

Now we go to an iris shot of palm trees swaying in front of a courthouse. 

There is nothing dull about the recent case of Sexton v. Apple Studios LLC, 110 Cal. App. 5th 183, 2025 Cal. App. LEXIS 205 (March 28, 2025). In fact, it is boffo box office bait. The case features a “that guy” actor — someone you’ve seen in many fine shows and movies (e.g., Deadwood, Justified). Appearing as co-stars are Covid-19 vaccine politics and application of an anti-SLAPP (strategic litigation against public participation) statute. 

Go to a close up of the plaintiff, the actor Brent Sexton.  His IMDB page is undeniably impressive. He was conditionally cast for the role of President Andrew Johnson in a television series based on James Swanson’s excellent book, Manhunt: The 12 Day Chase for Lincoln’s Killer (listeners of the “Advisory Opinions” legal podcast might recall that Manhunt was a book club selection.) Part of the condition was that the actor needed to be vaccinated against Covid-19. 

Filming of Manhunt was scheduled to commence in 2022.  At that time, concerns over transmission of the COVID-19 virus were high.  The film studio, relying on the then medical consensus, selected mandatory vaccination to promote safety on the Manhunt set. The studio decided that masking, periodic testing, and social distancing would be insufficient because actors and crew must operate in close quarters, actors could not wear masks in the historical production, lags made testing unworkable, vaccination reduced the threat of COVID-19 infections, many of the actors and other workers were at a higher risk of Covid-19 complications on account of age or pre-existing conditions, filming would take place in a location (Georgia)  with less restrictive Covid-19 measures, meaning there was an increased off-set risk of exposure, and mandatory vaccinations reduced the risk of production disruptions

The actor sought a medical exemption from the vaccine requirement, based on his history of blood clotting from thrombocytopenia and deep vein thrombosis. The studio considered the exemption request, but ultimately rejected it and, as they say in the biz, went in a different direction.  Sexton did not get the role, which would have earned him over a half a million dollars. He sued the studio for invasion of privacy, disability discrimination, failure to accommodate, and failure to engage in an interactive process. 

The studio filed a motion under the Anti-SLAPP statute. Do you remember how Anti-SLAPP statutes work?  California’s anti-SLAPP law (Civil Procedure Section 425.16) was designed to protect parties from strategic lawsuits filed to silence critics or intimidate those exercising their right to speak freely or petition the government. The law applies to lawsuits stemming from “any act… in furtherance of the person’s right of petition or free speech under the United States Constitution or the California Constitution in connection with a public issue.”  The law allows defendants (which can include businesses) to strike such lawsuits early in litigation.  Does that statute make sense in the context of an actor suing over not getting a part in a tv show?

The trial court denied the studio’s Anti-SLAPP motion, and the studio took the issue up on appeal.  The appellate court reversed and dismissed the case.  Why?

There are two prongs to the Anti-SLAPP analysis.  First, is the lawsuit directed against a “protected activity” that is freighted with First Amendment significance?  Second, if the defendant-movant met the first prong, can the plaintiff carry the burden of showing claims with at least minimal merit? The trial court concluded that the studio satisfied prong one because casting someone in an important on-screen role was an act that “shaped its television show’s editorial direction.”  But the trial court ruled against the studio on prong two, reasoning that the studio’s interest in vaccination was not “compelling” and the actor’s privacy claim had at least minimal merit. The trial court did not strike the lawsuit. The appeal followed. 

The appellate court agreed with the trial court that the studio successfully invoked the First Amendment over the casting decision. The challenged activity was creative, not just logistical, and involved the studio’s stance on COVID vaccination, a contentious public issue, and its presentation of a controversial historic figure, President Andrew Johnson.  (The court supplies a surprisingly comprehensive and nuanced discussion of President Johnson’s troubled legacy.)

Logistical arrangements and decisions were part of the studio’s creative endeavor and affected how the studio chose to speak and what it had to say. The court held that the anti-SLAPP statute covers significant media decisions about who will perform important roles for a wide public audience. It is interesting in itself that personnel decisions about on-screen mass media presentations about public issues are First Amendment protected.  

Where the appellate court parted company with the trial court was on prong two. The plaintiff’s claims were going nowhere. The complaint lacked even “minimal merit.”  The studio was operating under COVID safety rules negotiated with relevant unions, which included mandatory vaccination for all actors working on sets.  The studio’s science advisors agreed.  

The court took judicial notice of relevant CDC vaccination findings.The court also discussed the valid concern over vaccine “free riding.”   In short, the defendant reasonably relied on CDC vaccination recommendations.  There was no basis for the court to apply strict scrutiny. Accordingly, the case boiled down to reasonableness. 

The plaintiff’s privacy claim failed because there was no reasonable expectation of privacy under the circumstances.  Refusal to vaccinate for an acting job does not implicate privacy.  Employers determine workplace safety rules, including vaccination. Here, the studio’s rules were reasonable under the circumstances. Requiring vaccinations in group work settings is old hat, and the studio was following the suggestions of public health authorities. (The plaintiff submitted an expert opinion calling Covid vaccines bunk, but the opinion had no sound basis that would give it any value under Sargon.)

The plaintiff’s refusal to vaccinate made him unqualified for the job, because he could not safely do it.  The plaintiff could not authentically play a role in a movie as President Andrew Johnson while wearing a mask. That would be a crazy “accommodation.” His discrimination claim thus was not viable.  

The plaintiff’s claim that the studio failed to engage in an interactive process — whatever that means — failed because … the studio did engage. It considered the exemption request and it considered possible accommodations. It then arrived at a reasonable decision in favor of vaccination. According to the appellate court, the actor’s “position boils down to his claim that he had a right to impose a potentially deadly risk on coworkers so that he could act in Manhunt.  No precedent supports this claim.”  

In what can be described only as an happy ending for the film studio, the trial court’s order was reversed, the lawsuit was dismissed under SLAPP, and the plaintiff was ordered to pay the defendant’s fees and costs.

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Science and law share a common goal—getting at the truth; but their relationship can be shaky.  In areas like medicine and products liability, courts need to rely on science, but courts should not make science or get ahead of science.  Science is a methodical process that relies on testing, peer review, and replication. When science remains unproven, it needs to remain out of the legal system.  Prematurely adopting scientific findings into legal standards—before they have been thoroughly validated—can lead to institutionalizing unverified science and the creation of legal precedents that are difficult to overturn. Science has to lead and the law has to follow.  We have written about the consequences of the reverse.  Today, we talk about a case that put things in the right order.

Plaintiff in Davey v. Safeway Inc., 2025 Cal. Super. LEXIS 5572 (May 5, 2025), ingested over-the-counter acetaminophen while pregnant with her son.  Her son was later diagnosed with autism spectrum disorder (ASD) which plaintiff blames on the prenatal exposure to acetaminophen.  The drug’s label included an FDA-required warning that: “if pregnant or breast-feeding, ask a health professional before use.”  Plaintiff brought warning, negligence, and implied warranty claims alleging that defendants should have included a warning that “prenatal ingestion of acetaminophen may cause ASD.”  Id. at *1-2.  But there was no science to support that warning at the time of plaintiff’s ingestion, and there remains none today. 

The court summarized the issue:

This case raises the question of when a duty to warn of a specific health concern arises – above and beyond a general warning to discuss the matter with a medical professional — where the underlying science relating to the concern was (and remains) highly uncertain despite ongoing and extensive review by government regulators and independent medical entities alike.

Id. at *1.  The answer is there is no such duty.

The case thoroughly sets out the “state of the science,” which not surprisingly was described differently by the parties.  But rather than try to resolve those differences, the court looked to “a series of literature reviews conducted by federal regulators and independent medical entities.”  Id. at *10.  The upshot of which was that the available scientific evidence regarding the potential relationship between acetaminophen and ASD was “too limited to make any recommendations and did not warrant any changes to the FDA’s [required warning].”  Id. at *11.  As recently as 2023, the FDA’s continued review of the evolving science found that the “outcomes remain mixed” and do not alter its prior conclusions.  Id. at *17-18.

Under California law, a drug manufacturer is required to warn about “known or reasonably scientifically knowable dangerous propensities of its product.”  Id. at *24.  The concept of what is a knowable risk is inherently tied to the state of the science:

Consequently, “[t]he strength of the causal link . . . is relevant both to the issue of whether a warning should be given at all, and, if one is required, what form it should take.”   

Id. at *26 (quoting Finn v. G.D. Searle & Co., 35 Cal.3d 691, 701 (Ca. Sup. Ct. 1984). 

Both the FDA and courts recognize that over-warning poses its own risks.  It can lead to dilution of important warnings, consumer disregard, or could dissuade a consumer from using a needed product. 

Based on the state of the science, which was “profoundly uncertain and conflicting,” the court concluded as a matter of law that the “existence of any causal link [between acetaminophen and ASD] was neither known or scientifically knowable.”  Id. at *28.

The court was not persuaded that internal company analyses that included some “expressions of concern,” changed the legal conclusion:

That a company that makes pharmaceuticals regularly reviews the literature potentially relevant to the safety of its products and supports candid internal discussion, however, is positive corporate behavior.  While these discussions show awareness of the science, they do not change the state of that science.

Id. at *28-29.  And the state of the science warranted summary judgment.

We will acknowledge that there is another ruling in this opinion—rejecting defendants’ preemption defense.  But we are not going to talk about that because the case reached the right conclusion anyway.  And, with the court’s heavy reliance on the FDA’s review of the literature, the state of the science functions essentially the same as a preemption ruling that no “newly acquired information” existed to support a label change.   

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In a series of what we entitled “reports from the front,” we discussed how the federal government asserted, and eventually won, the right to intervene in ongoing False Claims Act suits to seek their dismissal notwithstanding the objections of the “relators” who were ostensibly pursuing these actions in the government’s name.  Basically, the relators claimed that, unless the government exercised its initial right to take over an FCA suit early on, the government lost all control over the relators, and they could essentially run wild using the government’s name.  The Supreme Court rightfully rejected that view.  United States ex rel. Polansky v. Executive Health Resources, Inc., 599 U.S. 419, 437-38 (2023) (government entitled to intervene and obtain dismissal of FCA action at any time on the basis of any “reasonable argument” regardless of the relator’s position).

However, three justices had more to add – they challenged that entire FCA private-attorney-general system as unconstitutional.  Justice Thomas stated in dissent:

The FCA’s qui tam provisions have long inhabited something of a constitutional twilight zone.  There are substantial arguments that the qui tam device is inconsistent with Article II and that private relators may not represent the interests of the United States in litigation. . . .  [T]he Court has held that conducting civil litigation for vindicating public rights of the United States is an executive function that may be discharged only by persons who are Officers of the United States under the Appointments Clause.  A private relator under the FCA, however, is not appointed as an officer of the United States under Article II.  It thus appears to follow that Congress cannot authorize a private relator to wield executive authority to represent the United States’ interests in civil litigation.  The potential inconsistency of qui tam suits with Article II has been noticed for decades.

Polansky, 599 U.S. at 449-50 (Thomas, J., dissenting) (citations and quotation marks omitted).  Concurring Justices Kavanaugh and Barrett agreed.  “I add only that I agree with Justice Thomas that “[t]here are substantial arguments that the qui tam device is inconsistent with Article II and that private relators may not represent the interests of the United States in litigation.”  Id. at 442 (concurring opinion).

Thus, we commented that “another front opens.”

Continue Reading FCA Frontal Assault in Eleventh Circuit
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Today’s post is a little different, in that it involves not an order, but a Motion for Relief from Judgment and to File an Amended Complaint (the “Motion”) filed by Pecos River Talc (“Plaintiff”) against Dr. Jacqueline Miriam Moline (“Dr. Moline”). Pecos River Talc LLC v. Moline, 3:23-cv-02990, Doc. No. 47-1 (D.N.J. Apr. 29, 2025).  Dr. Moline is a serial expert on behalf of plaintiffs in the cosmetic talcum powder litigation, and she was the lead author on a paper entitled “Mesothelioma Associated with the Use of Cosmetic Talc” (the “Article”).  The article was faked, as we originally discussed, here, in our “Stupid Expert Tricks Redux” post. That’s even clearer now, as the Motion we discuss here identifies bombshell, newly discovered evidence that undercuts the foundation of the Article and Dr. Moline’s opinions. This is a true “smoking gun.”

Continue Reading The Perils of Moline, Part II – Persistence Prevails in Re-Identifying Plaintiffs in Cosmetic Talc Article

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