Hood v. Bristol-Myers Squibb Co., No. 12-00179, 2013 WL 3280267 (N.D. Miss. June 27, 2013).
In this case, the District Court for the Northern District of Mississippi found that an action brought by Mississippi’s Attorney General on behalf of the State of Mississippi, as well as individual, Mississippi consumers, did not fall within the scope of CAFA’s “general public” exception. See 28 U.S.C. § 1332(d)(11)(B)(ii)(III).
The Attorney General of Mississippi brought a state court action alleging that several pharmaceutical manufacturers violated the Mississippi Consumer Protection Act (the “MCPA”) by mislabeling and falsely promoting the prescription drug Plavix® as a more effective alternative to aspirin. The defendants removed, and the plaintiff filed a motion to remand based on lack of subject matter jurisdiction. The district court denied the plaintiff’s motion, finding that the defendants properly removed on the bases of diversity jurisdiction and jurisdiction under CAFA.
After finding removal was proper on the basis of diversity of citizenship, the district court also held that the case was a “mass action,” and thus removable under CAFA. See 28 U.S.C. § 1332(d)(11)(B)(i).
First, the district court rejected the defendants’ argument that this lawsuit was a “class action,” as defined under CAFA. See 28 U.S.C. § 1332(d)(1)(B). The court began its analysis by noting that the Attorney General did not bring this suit under Federal Rule of Civil Procedure 23 and that Mississippi law has no class action procedure. Moreover, the plaintiff did not file suit under a state analogue to Rule 23. Instead, this action was brought pursuant to the MCPA – a state statute that prohibits class actions. Therefore, the court concluded that the Attorney General’s suit did not qualify as a class action under CAFA.
The court did, however, find that, under Fifth Circuit precedent, the case was a CAFA “mass action.” CAFA defines a “mass action” as “any civil action . . . in which [1] monetary relief claims of [2] 100 or more persons [3] are proposed to be tried jointly on the ground that the plaintiffs’ claims involve common questions of law or fact” and [4] include an amount in controversy in excess of $75,000. 28 U.S.C. § 1332(d)(11)(B)(i). Here, the Attorney General’s lawsuit sought monetary relief in the form of civil penalties, disgorgement of profits on the basis of unjust enrichment, interest, attorneys’ fees, and costs. Additionally, the suit was brought on behalf more than 100 Mississippi citizens, whose claims involved common questions of law or fact, and the amount in controversy, as stated in the complaint, was in the hundreds of millions of dollars. Thus, all the prerequisites for a mass action were present.
The district court then tackled the “thorny issue” in this case: “[W]hether even if the suit otherwise fits the criteria of a ‘mass action’ under CAFA, it nonetheless is not a mass action because it falls within the ‘general public’ exception of CAFA.” CAFA excludes from the term “mass action” any civil action in which all of the claims are asserted on behalf of the general public under a state statute specifically authorizing such an action. 28 U.S.C. § 1332(d)(11)(B)(ii)(III). Under Fifth Circuit precedent, though, the “general public” exception is inapplicable where individual consumers, as well as the State, are the real parties in interest, because, in that instance, there is no way that all the claims can be asserted on behalf of the general public. Miss. ex. rel. Hood v. AU Optronics Corp., 701 F.3d 796, 802 (5th Cir. 2012). Following this principle, the district court concluded that the “general public” exception did not apply, because this case was brought on behalf of individual purchasers and consumers of Plavix®, in addition to the State of Mississippi, not the general public.
Finally, the district court acknowledged that its conclusion was tenuous in light of the Supreme Court’s recent grant of certiorari to resolve a circuit split regarding whether a parens patriae action is removable as a “mass action” when the state is the sole plaintiff and the claims arise entirely under state law. See Miss. ex. rel. Hood v. AU Optronics Corp., 133 S.Ct. 2736 (2013). Since this issue is awaiting resolution by the Supreme Court, the district court was constrained to follow controlling Fifth Circuit precedent, as articulated in AU Optronics.
Accordingly, the district court concluded that this case was a “mass action” under CAFA and denied the plaintiff’s motion to remand.