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Vogel v. Merck & Co.

March 6, 2007

THOMAS VOGEL, PLAINTIFF,
v.
MERCK & CO., INC., WALGREEN CO., D / B / A LGREENS, WA AND AMERICAN DRUG STORES, INC., D/B/A OSCO DRUGS, DEFENDANTS.



The opinion of the court was delivered by: Murphy, Chief District Judge

MEMORANDUM AND ORDER

This matter is before the Court on the motion for a stay (Doc. 3) and the motion for a hearing (Doc. 16) brought by Defendant Merck & Co., Inc. ("Merck") and on the motion for remand to state court brought by Plaintiff Thomas Vogel (Doc. 12). Merck's motions are DENIED. Vogel's motion is GRANTED, and this action is REMANDED to state court on the basis of lack of subject matter jurisdiction and a procedural defect in removal.

INTRODUCTION

This case is a successor to Rutherford v. Merck & Co., Civil No. 06-159-GPM (S.D. Ill. filed Feb. 22, 2006).*fn1 In the Rutherford case Vogel joined with Barbara Rutherford, Edward Miechle, Rachel Garza, Beth Renee Brodhacker, Sandra Zola, Tom Benhoff, Emil Smith, Connie Testa, and Darrell Lane to bring suit against Merck for personal injuries allegedly caused by Vioxx, a prescription pain medication manufactured by Merck. In addition to Rutherford's claims against Merck, she also asserted claims against Defendant Walgreen Co. ("Walgreens") and Defendant American Drug Stores, Inc. ("Osco Drugs") based on prescriptions for Vioxx that Walgreens and Osco Drugs allegedly filled for her; similarly, Miechle asserted, in addition to his claims against Merck, claims against Osco Drugs based on prescriptions for Vioxx that Osco Drugs allegedly filled for him. The Rutherford action was filed originally in the Circuit Court of the Third Judicial Circuit, Madison County, Illinois, on January 13, 2006, then removed by Merck to this Court in federal diversity jurisdiction on February 22, 2006. On April 21, 2006, the Court remanded the Rutherford case to state court for lack of subject matter jurisdiction. See Rutherford v. Merck & Co., 428 F. Supp. 2d 842 (S.D. Ill. 2006).

On January 3, 2007, the Madison County circuit court entered an order in the Rutherford case providing, in pertinent part, that "the claims of plaintiffs Rutherford, Miechle, Garza, Brodhacker, Zola, Vogel, Benhoff, Smith, and Testa are severed." Doc. 2, Ex. 2.*fn2 On January 10, 2007, Merck removed Vogel's claims to this Court in diversity jurisdiction for the second time. Although after removal the case initially was assigned to United States District Judge Michael J. Reagan, on January 16, 2007, it was reassigned to the undersigned United States District Judge, in conformity with the Court's policy that related cases, in this instance Rutherford and this case, should be concentrated before the same judge. See Smith v. Check-N-Go of Ill., Inc., 200 F.3d 511, 513 n.1 (7th Cir. 1999); Blair v. Equifax Check Servs., Inc., 181 F.3d 832, 839 (7th Cir. 1999); Anderson v. Cornejo, 199 F.R.D. 228, 262 (N.D. Ill. 2000).*fn3 Vogel now has moved for remand of his claims to state court. Merck in turn has moved for a stay of this case pending transfer of the case to a multidistrict litigation proceeding and for a hearing on Vogel's motion for remand. Having reviewed the submissions of the parties, the Court discerns no merit in Merck's request for a stay or a hearing and concludes this case is due to be remanded to state court.

DISCUSSION

A. Legal Standard

Under 28 U.S.C. § 1441, "any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending." 28 U.S.C. § 1441(a). A federal court may exercise jurisdiction in diversity if all parties to an action are of completely diverse citizenship, that is, no plaintiff is a citizen of the same state as any defendant, and an amount in excess of $75,000, exclusive of interest and costs, is in controversy. See 28 U.S.C. § 1332; Johns v. Johns Mitchell, No. 06-924-GPM, 2007 WL 496391, at *2 (S.D. Ill. Feb. 13, 2007). The party seeking removal has the burden of establishing federal jurisdiction. See Yount v. Shashek, No. CIV. 06-753-GPM, 2006 WL 4017975, at *1 (S.D. Ill. Dec. 7, 2006). "'Courts should interpret the removal statute narrowly and presume that the plaintiff may choose his or her forum.' Put another way, there is a strong presumption in favor of remand." LaRoe v. Cassens & Sons, Inc., No. CIV. 06-713-GPM, 2006 WL 4018917, at *1 (S.D. Ill. Nov. 30, 2006) (quoting Doe v. Allied-Signal, Inc., 985 F.2d 908, 911 (7th Cir. 1993)). See also Dudley v. Putnam Inv. Funds, Civil No. 06-940-GPM, 2007 WL 329129, at *8 n.6 (S.D. Ill. Feb. 1, 2007) ("[T]he Court is required to apply the removal statutes strictly, with a presumption in favor of remand, . and the Court has not been empowered by Congress . to fashion equitable removal solutions to procedural complexities[.]").

B. Existence of Diversity Jurisdiction

As discussed, the basis for federal subject matter jurisdiction in this case is diversity, so that complete diversity of citizenship is required. However, it appears from the record that while Merck is a New Jersey citizen, Vogel, like Walgreens and Osco Drugs, is an Illinois citizen. See Doc. 2, Ex. 1 ¶ 7, ¶ 13, ¶ 15, ¶ 16. Merck argues that diversity of citizenship is complete because the claims asserted against Walgreens and Osco Drugs in the Rutherford case were severed from Vogel's claims in state court. This requires the Court in turn to examine whether a true severance of claims occurred in state court.

The term "severance" is a word of sometimes indeterminate meaning. As the United States Court of Appeals for the Seventh Circuit recently explained, when a true severance of claims occurs under Rule 21 of the Federal Rules of Civil Procedure, each severed claim "proceeds as a discrete unit with its own final judgment, from which an appeal may be taken." Gaffney v. Riverboat Servs. of Ind., Inc., 451 F.3d 424, 441 n.17 (7th Cir. 2006). Conversely, when a "severance" amounts merely to an order directing separate trials as to the claims or parties in a case, see FED. R. CIV. P. 42(b), a judgment that disposes of fewer than all of the claims or parties is interlocutory and unappealable absent entry of the appropriate certification under Rule 54(b) of the Federal Rules of Civil Procedure. See Gaffney, 451 F.3d at 442 n.18. See also Sidag Aktiengesellschaft v. Smoked Foods Prods. Co., 813 F.2d 81, 84 (5th Cir. 1987) (when severance is effected under Rule 21, "[t]he . severed claim becomes an entirely separate judicial unit, so that a final adjudication of it is appealable, notwithstanding that there remain unresolved claims pending in the original action from which the severance was granted and that no Rule 54(b) certificate has been issued."); Begalke v. Sterling Truck Corp., No. 06-C-186-C, 2006 WL 3091110, at *1 (W.D. Wis. Oct. 26, 2006) (quoting Gaffney, 451 F.3d at 442) (severance under Rule 21 "creates two separate actions or suits where previously there was but one," whereas a request for separate trials is cognizable not under Rule 21 but Rule 42(b) and effects merely a "separation of claims in an action in which multiple parties have been joined.") (emphasis omitted). The confusion that can arise from loose talk of "severance" where in fact only a separation of claims has occurred, together with the impact the distinction can have on appellate jurisdiction, occasionally has provoked judicial frustration. See Spencer, White & Prentis, Inc. v. Pfizer, 498 F.2d 358, 359 (2d Cir. 1974) (speaking of the "tangle of Rules 21, 42(b) [and] 54(b)").*fn4

In the context of removal to federal court in diversity jurisdiction, the mere fact that an order of a state court purports to have "severed" claims generally is insufficient to make a case removable. See Nolan v. Boeing Co., 919 F.2d 1058, 1067 (5th Cir. 1990) (holding that diversity-defeating parties were not severed from a case so as to permit removal to federal court where Article 1038 of the Louisiana Code of Civil Procedure, pursuant to which the severance was made, authorizes "separate trials" rather than a true "severance"); Phillips v. Unijax. Inc., 625 F.2d 54, 56 (5th Cir. 1980) (an order granting separate trials pursuant to Alabama procedural rules did not sever claims and thereby create two separate lawsuits for purposes of removal in diversity). For example, in Caldwell v. Alfa Insurance Corp., 806 F. Supp. 623 (S.D. Miss. 1992), the court held that a state-court order providing that a plaintiff's claims against a non-diverse defendant were "severed for trial purposes" from the plaintiff's claims against a diverse defendant did not permit removal of the claims against the diverse defendant. Id. at 624. "[G]iven a widely-recognized looseness in usage of the language" regarding severance, the court held, "[u]se of the word 'severed' is insufficient, in itself, to establish a Rule 21 severance." Id. at 625.*fn5 Because it was not clear that the plaintiff's claims against the diversity-defeating party were not a part of the case, the court remanded the case to state court. See id. at 626. As Caldwell illustrates, "[f]ederal district courts have . held that a defendant does not carry the burden of establishing federal jurisdiction where jurisdiction is predicated on a state court order that merely states that plaintiff's claims are to be 'severed' from claims against non-diverse defendants." Grefer v. Travelers Ins. Co., No. Civ.A. 03-0253, 2003 WL 22717716, at *4 (E.D. La. Nov. 18, 2003) (holding that diversity jurisdiction was not established by a state-court order that provided only that the plaintiffs' claims against a non-diverse defendant "be and hereby are, severed from this action").

In Johnson v. Snapper Division of Fuqua Industries, Inc., 825 F. Supp. 127 (E.D. Tex. 1993), the court discussed some factors to be considered in evaluating whether a state-court severance order has rendered a case removable in diversity, including: (1) whether the severance "truly create[s] different lawsuits, and not just separate trials in a single lawsuit"; (2) whether a non-diverse party has been removed to federal court together with a diverse defendant and whether the diverse party is participating in the pre-trial proceedings in the federal court, "leading to the conclusion that no true severance has taken place"; and (3) whether the state court severance has "result[ed] in entirely separate actions with separate judgments for the claims which are severed." Id. at 129 (citing Phillips, 625 F.2d at 56). The court found that all of the requirements were met by an "Agreed Order for Severance of Actions" entered in a state court containing the following provisions:

(1) the [state] court found that there was no reason to delay the entry of a final judgment in favor of the [non-diverse defendant] based upon the granted motion for summary judgment; (2) the plaintiffs' claims against the non-diverse [defendant] were "severed . and made the subject of a separate action" under a new style and with a new cause number; and (3) separate judgments were to be entered in the severed cases, ...


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