Dunn v. Endoscopy Center of Southern Nevada, No. 2:11–cv–00560–RLH–PAL, 2011 WL 5509004 (D. Nev. Nov. 7, 2011).

Having a colonscopy isn’t bad enough? How about getting Hepatitis C during your colonscopy? That sucks. Oh, and the answer to the question in the headline is Propofol (also now known as the Michael Jackson drug). Read on.

In this consolidated action, a District Court in Nevada held that “mass action” does not include any civil action involving “a single event or occurrence,” such as an environmental accident, that gives rise to the claims of all plaintiffs.  Further, use of singular in the statutory language–“an event or occurrence” not “events or occurrences,” would not apply to a product liability case because the sale of a product to different people does not qualify as an event.

This consolidated action arises out of the alleged misuse of syringes and Propofol vials at the Endoscopy Center of Southern Nevada and at Desert Shadow Endoscopy Center.

In December 2007, after the Southern Nevada Health District received several independent reports of Hepatitis C infections from physicians and hospitals, it investigated the situation and eventually determined that the infected patients had been treated at the Endoscopy Centers. During the joint investigation, the Health District and the federal Center for Disease Control found Certified Registered Nurse Anesthetists reusing syringes on a single patient to draw anesthesia form a vial of Propofal and then reusing the vial of Propofol on a subsequent patient. The Health District, based on its investigation, sent out notices to patients who had undergone procedures at the Endoscopy Centers between March 2004 and January 2008, that they should be tested for Hepatitis B, Hepatitis C, and HIV.

These events have led to multiple lawsuits, and this case was brought as 88 separate suits in Nevada State Court on behalf of 3,630 different plaintiffs who did not contract a disease from the Endoscopy Centers. These plaintiffs alleged various causes of action based on exposure to blood borne diseases at the Endoscopy Centers and products liability related claims against the Propofol manufacturers and distributors.

Almost two years after filing their complaints in state court, the plaintiffs moved to consolidate all 88 cases for trial under the basis that the various suits were all based on the same facts. The state court accordingly consolidated cases for trial. Once the cases were consolidated, the defendants removed the case to the federal court asserting jurisdiction under CAFA, specifically claiming “mass action” jurisdiction under 28 U.S.C. § 1332(d)(11)(B)(i). 

The plaintiffs moved to remand, which the District Court denied.

First, the plaintiffs argued that the Court lacked subject matter jurisdiction because this action was not a “mass action” as defined by § 1332(d)(11)(B)(ii)(I). The statute states, the term “mass action” shall not include any civil action in which all of the claims in the action arise from an event or occurrence in the State in which the action was filed, and that allegedly resulted in injuries in that State or in States contiguous to that State.

Accordingly, the plaintiffs argued that this action arose out of a single event or occurrence in Nevada, thus excluding it from the definition of a “mass action.” 

The Court disagreed, and noted that the courts in Lafalier v. Cinnabar Serv. Co., Inc., No. 10–cv–0005, 2010 WL 1486900, at *4 (N.D. Okla. Apr. 13, 2010) and Galstaldi v. Sunvest Cmtys USA, LLC, 256 F.R.D. 673, 676 (S.D .Fla.2009) interpreting this provision “have consistently construed the ‘event or occurrence’ language to apply only in cases involving a single event or occurrence, such as an environmental accident, that gives rise to the claims of all plaintiffs.” (Editors’ Note: See the CAFA Law Blog analysis of Lafalier posted onAugust 4, 2010 and the CAFA Law Blog analysis of Galstaldi posted on May 27, 2009.) 

Further, the Court noted that use of the singular in the statutory language–“an event or occurrence” not “events or occurrences” is important. In addition, the CAFA’s legislative history supports the Courts conclusion. Specifically, Congress expressly contemplated that the event or occurrence exception would not apply to a product liability case because the sale of a product to different people does not qualify as an event, S.Rep. No. 109–14, at 47, reprinted in 2005 U.S.C.C.A .N. 3, 44. Rather, this exception is supposed to apply to a “truly local single event” like “environmental torts such as a chemical spill.” Id.

The Court stated that although the plaintiffs tried to analogize this case to an environmental tort like a chemical spill, it simply wasn’t because this products liability case did not involve a single event or occurrence, but alleged conduct occurring over a period of multiple years. Such allegations simply could not be construed to be a single event or occurrence because the allegations were based both on the various injections and the entirely separate design of the Propofol vials. Thus, the Court concluded that the plaintiffs’ arguments failed.

Second, the Court found that the local controversy exception, § 1332(d)(4)(A)(ii), did not apply because another class action was filed within the preceding three years, specifically, Rader v. Teva Parenteral Medicine, Inc., 2:10–cv–00818–JCM–LRL.

Finally, the Court observed that the defendants met their burden to establish a sufficient amount in controversy — at least one plaintiff’s claim exceeded $75,000, and aggregate class claims were over $5 million. Specifically, the Court stated that the plaintiffs in the Dunn complaint simply requested more than $75,000. Further, given that there were total 3,630 plaintiffs, each individual plaintiff need only request $1,378 to meet the $5 million requirement. Because each plaintiff asserted exemption from mandatory arbitration, which requires that the “probable jury award” exceed “$50,000 per plaintiff, the Court concluded that each plaintiff sought in excess of $50,000, which was far more than $5 million in aggregate.

 Accordingly, the Court denied the plaintiffs’ motion to remand