PHILADELPHIA – The first talcum powder/cancer trial in Philadelphia will take place in state court, after a federal judge recently ruled that Johnson & Johnson was wrong in its attempts to remove the case from the federal venue on the very day jury selection was to take place.
U.S. District Court for the Eastern District of Pennsylvania Judge Michael M. Baylson turned away arguments from defense counsel, which postulated that attorneys for plaintiffs Ellen Kleiner and Yuri Kleiner acted in bad faith by initially suing Pennsylvania-based Rite Aid in an attempt to keep the case in state court, only to dismiss those claims the day before trial.
The Kleiners, of Richboro, first filed suit in the Philadelphia County Court of Common Pleas on Jan. 18, 2017 versus Rite Aid Corporation and Rite Aid of Pennsylvania, Inc. of Camp Hill, Johnson & Johnson and Johnson & Johnson Consumer, Inc. of New Brunswick, N.J., Imerys Talc America, Inc. of Jefferson City, Mo. and the Personal Care Products Council of Washington, D.C.
(Personal Care Products Council was dismissed as a defendant on Dec. 28, 2017 and Imerys Talc America was likewise dismissed as a defendant on Feb. 5, 2019.)
The Kleiners allege that they bought J&J’s baby powder product from Rite Aid stores and the product caused Ellen to contract ovarian cancer. Extensive discovery followed, including the plaintiffs taking discovery from Rite Aid and vice-versa. After a delay due to the COVID-19 pandemic and an unsuccessful settlement conference, the five-week trial was set to take place this month.
“As the trial date neared, jury selection was scheduled to take place on July 29, 2021. Several events happened in rapid succession. Discussions took place between plaintiffs’ counsel and counsel for J&J’s co-defendant, Rite Aid, concerning whether Rite Aid would be interested in entering into a settlement agreement with plaintiffs. Rite Aid’s counsel replied, consistent with other settlement inquiries, that Rite Aid was not interested in paying any money to settle the case,” Baylson said.
“Plaintiffs’ counsel nonetheless made a demand, but Rite Aid did not budge. After some fairly routine negotiating phone calls, with Rite Aid consistently refusing to pay any money to settle the case, plaintiffs’ counsel advised Rite Aid counsel that plaintiffs were going to drop Rite Aid as a defendant by entering a voluntarily dismissal. Plaintiffs’ counsel prepared a stipulation to dismiss Rite Aid on the afternoon before jury selection was scheduled to begin. Within a short period of time, on July 28, 2021, counsel for plaintiffs, Rite Aid, and J&J executed the stipulation.”
After Rite Aid was dismissed from the case on July 28, J&J filed a notice of removal to the U.S. District Court for the Eastern District of Pennsylvania – which led the plaintiffs to counter-file an “emergency” motion to remand on July 30, which J&J also opposed.
Subsequent to telephonic arguments on the motion to remand, Baylson opted to grant the motion and send the case back to the Philadelphia County Court of Common Pleas, finding that the Kleiners’ counsel had not acted in bad faith.
“The most important fact from the point of view of J&J, in opposing remand, is the fact that plaintiffs communicated their decision to drop Rite Aid the evening before jury selection was scheduled to begin. Several cases have noted that a ‘last minute’ dropping of a defendant whose presence in the case had prevented federal jurisdiction is substantive evidence of bad faith. However, this Court finds that there is substantial other evidence that prevents a finding of bad faith here,” Baylson stated.
“First, a distinction must be drawn between legitimate strategy in high-stakes litigation as opposed to bad faith. Plaintiffs may have had a legitimate strategy in pre-trial brinksmanship with Rite Aid – waiting for the pressure of trial to convince Rite Aid to pay to settle. That this strategy did not ultimately succeed does not mean that it was undertaken in bad faith. Nor did plaintiffs’ decision to dismiss Rite Aid without monetary settlement necessarily indicate bad faith – plaintiffs reasonably could have preferred to have only one defendant as the focus of the trial or wanted to avoid testimony on Rite Aid-related issues that could lead to harmful cross-examination.”
Baylson also mentioned the possibility that the COVID-19 pandemic was the attributable reason for any perceived delay from the Kleiners in settlement discussions or dismissing Rite Aid from the case.
“Plaintiffs’ behavior throughout this litigation provides evidence that they were not simply pretending to litigate against Rite Aid; they were actively doing so. Plaintiffs sought discovery from Rite Aid, engaged in disputes with Rite Aid, opposed Rite Aid’s motion for summary judgment (successfully), and even prepared jury questions regarding Rite Aid’s liability,” Baylson said.
“Another important factor here relates to the discussion at the hearing about the delay in trial, and what different considerations (strategic or otherwise) went towards entering into, accelerating, or delaying trial. This case was ready for trial in the Court of Common Pleas after four years of pre-trial proceedings had been completed. By filing a motion for stay of proceedings in this Court, J&J candidly acknowledged that it intends to seek consolidation with pretrial proceedings in the District of New Jersey…if the case remained in this Court.”
In Baylson’s view, J&J intended to delay trial of this case until the pre-trial proceedings in New Jersey federal court were completed, which could take several years, despite pre-trial proceedings in the instant case being completed. That, Baylson said, only added to the reasons to grant the motion to remand.
“The Court cannot fault plaintiffs for preferring to keep this case out of federal court, and, based on the totality of circumstances here, J&J has not satisfied its heavy burden to show that plaintiffs did so out of bad faith. Because ‘removal statutes are to be strictly construed against removal and all doubts should be resolved in favor of remand,’ remand to state court is proper here,” Baylson said.
U.S. District Court for the Eastern District of Pennsylvania case 2:21-cv-03366
Philadelphia County Court of Common Pleas case 170102505
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com