BRIGHT, Circuit Judge.
The plaintiffs, women and next-of-kin of deceased women, sued a number of manufacturers of hormone replacement therapy drugs, asserting the drugs caused breast cancer. The defendants, manufacturers of hormone replacement therapy drugs ("manufacturers"), removed the cases to federal court. The plaintiffs moved to remand to state court on the grounds that complete diversity of citizenship was lacking, thereby depriving the court of subject matter jurisdiction. The district court concluded that the plaintiffs' claims were misjoined to defeat diversity jurisdiction, dropped the non-diverse plaintiffs, and dismissed these cases. Plaintiffs appeal, and we reverse the district court's orders denying plaintiffs' motions to remand and granting the manufacturers' motions to dismiss duplicative cases.
A. Hormone Replacement Therapy
Hormone replacement therapy ("HRT") drugs are used in the treatment of menopausal symptoms. Such symptoms include hot flashes, chills, headache, irritability, and vaginal atrophy. HRT drugs consist of a combination of estrogen and progestin. The Women's Health Initiative (WHI), a group focused on defining the risks and benefits of strategies that could reduce heart disease, cancer, and fractures in post-menopausal women, began studying the effects of HRT drugs in the 1990s. The WHI enrolled 161,809 post-menopausal
WHI studied the effect of estrogen plus progestin in 16,608 women with an intact uterus. Women were either assigned a daily dose of estrogen plus progestin or a placebo. In 2002, an independent data and safety monitoring board revealed that the number of cases of breast cancer in the estrogen plus progestin group had crossed the boundary established as a signal of increased risk. The independent board recommended that the trial be ended early based on an increased breast cancer risk. The results of the WHI study were published in The Journal of the American Medical Association. See Risks and Benefits of Estrogen Plus Progestin in Healthy Postmenopausal Women, 288 J. Am. Med. Ass'n. 321-333 (2002), available at http://jama.ama-assn.org/cgi/content/full/288/3/321.
B. The Lawsuits
This case concerns three lawsuits. The Kirkland suit was brought by 57 women who each alleged injuries resulting from their use of HRT medications. The Kirkland plaintiffs alleged they each developed breast cancer after taking HRT drugs that were manufactured, marketed, and sold by one or more of eleven manufacturers. Fourteen Kirkland plaintiffs are citizens of the same state as at least one of the manufacturers. Three of those fourteen plaintiffs asserted claims against manufacturers with the same citizenship. For example, Nancy States is a citizen of Pennsylvania, the same state as Wyeth Pharmaceuticals, Inc., a company that manufactured and marketed HRT drugs she took.
The Jasperson suit was brought by Rick Jasperson, as trustee of the next-of-kin of six decedents who used HRT drugs. The Jasperson plaintiffs alleged that in each case, the next-of-kin sustained injuries when a woman family member developed breast cancer as a result of taking HRT drugs that were manufactured, marketed, and sold by one or more of six defendants. One of the six decedents, Elizabeth Mendelson, was a citizen of New Jersey, the same state as Pharmacia Corporation, Wyeth, and Pharmacia & Upjohn Company, companies that manufactured and marketed HRT drugs that Mendelson took.
The Allen suit was brought by 60 women who also alleged they each developed breast cancer as a result of HRT medications manufactured, marketed, and sold by one or more of eight defendants. Five Allen plaintiffs are citizens of the same state as at least one of the defendants. Three of these five plaintiffs asserted claims against manufacturers who were citizens of the same state. For example, Rachel Epstein is a citizen of New York, the same state as Pfizer, a company that manufactured and marketed HRT drugs that she took.
C. Procedural History
The Kirkland, Jasperson, and Allen plaintiffs filed suits for damages in Minnesota state court in July 2008. In each of the three consolidated cases, the plaintiffs alleged they or a decedent family member had developed breast cancer from taking HRT medications. The plaintiffs asserted state law claims for negligence, strict liability, breach of implied warranty, breach of express warranty, fraud, negligent misrepresentation, and statutory violations of the False and Misleading Advertising Act, the Prevention of Consumer Fraud Act, and the Uniform Deceptive Trade Practices Act.
The manufacturers removed all three cases to the United States District Court for the District of Minnesota. In the manufacturers' removal petitions, they argued
The plaintiffs filed motions to remand the cases to state court for lack of subject matter jurisdiction, asserting that complete diversity between the plaintiffs and defendants did not exist. Before the plaintiffs' motions were addressed, the litigation came before the United States Judicial Panel on Multidistrict Litigation ("MDL"). The Kirkland and Jasperson cases were transferred to the Eastern District of Arkansas and assigned to an MDL judge. Plaintiffs requested that the MDL court rule on their pending motions to remand to state court.
Before the MDL court ruled on the question of remand, on December 19, 2008, the manufacturers moved to dismiss most of the claims brought by the Kirkland plaintiffs and all of the claims brought on behalf of the Jasperson decedents on the grounds that the plaintiffs' claims were duplicative of earlier filed California claims.
On December 29, 2008, the court denied plaintiffs' requests for an extension, stating that it "did not grant your Motion for Extension of Time to Respond, because I'm satisfied that you couldn't say anything that would change my mind on the issues involved here." On that same day, the court denied in part plaintiffs' motions to remand the Kirkland and Jasperson cases to state court, concluding that the plaintiffs were misjoined. The court stated that there was no reason for the joinder of the non-diverse plaintiffs other than to defeat diversity jurisdiction, and explained
Appellants' Add. at 134-35.
The court concluded that the plaintiffs had failed to properly join under Rule 20 because "[t]he only thing common among Plaintiffs is that they took an HRT drug— but not necessarily the same HRT drug. Plaintiffs are residents of different states and were prescribed different HRT drugs by different doctors, for different lengths of time, in different amounts, and they suffered different injuries." Id. at 135.
The court granted four of the Kirkland and Jasperson plaintiffs' motions to remand because those plaintiffs had asserted claims against a defendant who was from the same state. The court denied 59 Kirkland and Jasperson plaintiffs' motions to remand because the plaintiffs were not asserting claims against manufacturers from the same state. The court granted the manufacturers' motions to dismiss as to these 59 plaintiffs. The court dropped the 59 plaintiffs from the lawsuit and dismissed their claims, because they duplicated previously-filed California claims.
In February 2009, the United States Judicial Panel on MDL transferred the Allen case to the same MDL court for coordinated proceedings with other pending HRT cases. On February 10, 2009, plaintiffs refiled their motions to remand the Allen case to state court. The court denied the motions on that same day, stating that the plaintiffs were improperly joined under Rule 20 and that he could "see no reason for the joinder of the non-diverse plaintiffs other than to defeat diversity jurisdiction." Id. at 383. The court granted three of the Allen plaintiffs' motions to remand because those women had asserted claims against a manufacturer who was from the same state. The court granted the manufacturers' motions to dismiss as to the remaining 57 plaintiffs. The court dropped the remaining 57 plaintiffs from the lawsuit and dismissed their claims because of their duplicative cases.
As a result of the district court's orders in Kirkland, Jasperson, and Allen, seven plaintiffs' cases were remanded to state court and the remaining 116 plaintiffs were dropped from the litigation and their cases were dismissed.
The dismissed plaintiffs
On appeal, the plaintiffs argue the district court erred in denying their motions to remand by applying a discredited theory known as "fraudulent misjoinder"
"We review the district court's denial of the remand motion de novo." Menz v. New Holland North America, Inc., 440 F.3d 1002, 1004 (8th Cir.2006); see also Wilkinson v. Shackelford, 478 F.3d 957, 963 (8th Cir.2007) ("Whether a plaintiff has fraudulently joined a party to defeat diversity jurisdiction is a question of subject matter jurisdiction we review de novo.").
A defendant may remove a state law claim to federal court only if the action originally could have been filed there. Phipps v. FDIC, 417 F.3d 1006, 1010 (8th Cir.2005). Diversity jurisdiction under 28 U.S.C. § 1332 requires an amount in controversy greater than $75,000 and complete diversity of citizenship among the
After removal, a plaintiff may move to remand the case to state court, and the case should be remanded if it appears that the district court lacks subject matter jurisdiction. 28 U.S.C. § 1447(c). The defendant bears the burden of establishing federal jurisdiction by a preponderance of the evidence. Altimore v. Mount Mercy College, 420 F.3d 763, 768 (8th Cir.2005). All doubts about federal jurisdiction should be resolved in favor of remand to state court. Wilkinson, 478 F.3d at 963.
Courts have long recognized fraudulent joinder as an exception to the complete diversity rule. See 14B Charles Alan Wright, Arthur R. Miller, Edward H. Copper, Federal Practice and Procedure § 3723, at 788-789 (4th ed.2009). Fraudulent joinder occurs when a plaintiff files a frivolous or illegitimate claim against a non-diverse defendant solely to prevent removal. Filla v. Norfolk S. Ry. Co., 336 F.3d 806, 809 (8th Cir.2003). When determining if a party has been fraudulently joined, a court considers whether there is any reasonable basis in fact or law to support a claim against a nondiverse defendant. Wilkinson, 478 F.3d at 964.
A more recent, somewhat different, and novel exception to the complete diversity rule is the fraudulent misjoinder doctrine which one appellate court
Ronald A. Parsons, Jr., Should the Eighth Circuit Recognize Procedural Misjoinder?, 53 S.D. L.Rev. 52, 57 (2008).
The Eleventh Circuit first considered and adopted the fraudulent misjoinder doctrine in Tapscott v. MS Dealer Serv. Corp., 77 F.3d 1353, 1360 (11th Cir.1996). Tapscott concerned a putative class action filed
The initial complaint and first amended complaint alleged fraud violations arising from the sale of automobile service contracts. Id. The second amended complaint alleged fraud violations arising from the sale of extended service contracts in connection with the sale of retail products. Id. The result of the amended complaints and joinder under Rule 20 was to create two distinct groups of plaintiffs and defendants: the non-diverse "automobile class" and the diverse "merchant class." Id. at 1359-60, n. 16.
Lowe's Home Centers removed the case to federal court and moved to sever the claims against it from the claims against the automobile class defendants. Id. at 1355. The plaintiffs moved to remand to state court for lack of federal subject matter jurisdiction. Id. The district court granted Lowe's Home Centers' motion to sever and denied the plaintiffs' motion to remand to state court, holding that there was "no allegation of joint liability between Lowe's and any other defendant and no allegation of conspiracy" and "there was an improper and fraudulent joinder, bordering on a sham." Id. at 1360 (internal quotations omitted).
On appeal, the Eleventh Circuit Court of Appeals affirmed the district court's denial of the plaintiffs' motion to remand. Id. The court held there was misjoinder under Rule 20 because there was "no real connection" between the two sets of alleged transactions. Id. The court reasoned that the alleged transactions concerning the automobile class were wholly distinct from the transactions involving the merchant class. Id. The only similarity between the two classes was that both classes violated particular fraud provisions in the Alabama state code. Id. The Eleventh Circuit cautioned that "mere misjoinder" is not fraudulent misjoinder. Id. However, the plaintiffs' joinder of these two groups of unrelated defendants was "so egregious as to constitute fraudulent joinder." Id. Therefore, the Eleventh Circuit reasoned that the district court did not err in concluding the plaintiffs attempted to defeat diversity jurisdiction by misjoinder. Id.
Courts' reactions to Tapscott have been mixed. Some district courts have adopted the doctrine as a means of ensuring defendants their statutory right of removal to the federal courts and precluding plaintiffs from preventing removal to federal court. See, e.g., In re Diet Drugs, No. 98-20478, 1999 WL 554584, at *3 (E.D.Pa. July 16, 1999) (unreported) (explaining that plaintiffs' egregious misjoinder "wrongfully deprives Defendants of their right of removal."); Reed v. American Medical Sec. Group, Inc., 324 F.Supp.2d 798, 805 (S.D.Miss.2004) (adopting the fraudulent misjoinder doctrine because "diverse defendants ought not be deprived of their right to a federal forum by such a contrivance as this."). See also Laura J. Hines & Steven S. Gensler, Driving Misjoinder: The Improper Party Problem in Removal Jurisdiction, 57 Ala. L.Rev. 779, 825 (2006) (explaining that fraudulent misjoinder protects access to federal courts).
Other courts have criticized Tapscott, arguing that questions of joinder under state law do not implicate federal subject matter jurisdiction, federal jurisdiction is
The Eighth Circuit Court of Appeals has not yet considered the fraudulent misjoinder doctrine. See Parsons, supra, at 60. We make no judgment on the propriety of the doctrine in this case, and decline to either adopt or reject it at this time. Rather, on the record in this case, we conclude that even if we adopted the doctrine, the plaintiffs' alleged misjoinder in this case is not so egregious as to constitute fraudulent misjoinder.
Rule 20(a)(1), Federal Rules of Civil Procedure, allows multiple plaintiffs to join in a single action if (i) they assert claims "with respect to or arising out of the same transaction, occurrence, or series of transactions or occurrences;" and (ii) "any question of law or fact common to all plaintiffs will arise in the action."
Id. at 1333 (citations omitted); see also 7 Charles A. Wright et al., Federal Practice and Procedure, § 1653, at 415 (3d ed.2001) (explaining that the transaction/ occurrence requirement prescribed by Rule 20(a) is not a rigid test and is meant to be "read as broadly as possible whenever doing so is likely to promote judicial economy.").
Furthermore, given the nature of the plaintiffs' claims, this litigation is likely to contain common questions of law and fact. See Hines & Gensler, supra, at 822 ("When plaintiffs join together to sue a defendant based on the purchase of a common product or having engaged in a common transaction, it seems rather clear that their claims will involve some common question of law or fact."). One such common question might be the causal link between HRT drugs and breast cancer. Causation for all of the plaintiffs' claims will likely focus on the 2002 WHI study suggesting a link between HRT drugs and breast cancer and whether the manufacturers knew of the dangers of HRT drugs before the publication of that study.
Based on the plaintiffs' complaints, we cannot say that their claims have "no real connection" to each other such that they are egregiously misjoined. See Tapscott, 77 F.3d at 1371. This is unlike Tapscott where the alleged transactions concerning the automobile class were wholly distinct from the transactions involving the merchant class and there was "no real connection" between the two sets of transactions. Id. Here, there may be a palpable connection between the plaintiffs' claims against the manufacturers as they all relate to similar drugs and injuries and the manufacturers' knowledge of the risks of HRT drugs.
Furthermore, the manufacturers have presented no evidence that the plaintiffs joined their claims to avoid diversity jurisdiction. "[T]he majority of courts demand more than simply the presence of nondiverse, misjoined parties, but rather a showing that the misjoinder reflects an egregious or bad faith intent on the part of the plaintiffs to thwart removal." Hines & Gensler, supra, at 803. Without any evidence that the plaintiffs acted with bad faith, we decline to conclude they egregiously misjoined their claims.
We clarify that we make no judgment on whether the plaintiffs' claims are properly joined under Rule 20. See Moore v. SmithKline Beecham Corp., 219 F.Supp.2d 742, 746 (N.D.Miss.2002) ("Of course, the court is not faced with and expresses no opinion as to the issue of whether joinder is proper in this case; rather, the court's task is solely to determine whether the Plaintiffs are so egregiously misjoined that fraudulent joinder has taken place."). It may be that the plaintiffs' claims are not properly joined, and it has been suggested that the proper procedure may be for the manufacturers to argue that to the state
Because the joinder of claims in this case does not constitute egregious misjoinder, complete diversity does not exist and the district court erred in denying plaintiffs' motions to remand to state court. We reverse the district court's orders and judgments granting in part and denying in part plaintiffs' motions to remand to state court and instruct the district court to remand all of the cases to Minnesota state court for lack of diversity jurisdiction. Because the district court lacked jurisdiction to act in this matter, we also vacate the district court's orders granting the manufacturers' motions to dismiss the duplicative cases.