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M.M. v. GlaxoSmithKline LLC

Court of Appeals of Illinois, First District, Fifth Division

August 26, 2016

M.M., a Minor, by and Through Audrey Meyers, Her Mother and Next Friend; A.H., a Minor, by and Through Dawn Hinton, Her Mother and Next Friend; P.M., a Minor, by and Through Linda Butler, His Mother and Next Friend; H.C., a Minor, by and Through Amy Christy, Her Mother and Next Friend; H.H., a Minor, by and Through Kristen Hozempa, His Mother and Next Friend; A.K., a Minor, by and Through Kathryn Keady, His Mother and Next Friend; C.S., a Minor, by and Through Stacey Schutte, Her Mother and Next Friend; and C.E., a Minor, by and Through Shannon Emery, His Mother and Next Friend, Plaintiffs-Appellees,
GLAXOSMITHKLINE LLC, f/k/a SmithKlineBeecham Corporation, d/b/a SmithKlineBeecham; WOLTERS KLUWER HEALTH, INC.; WOLTERS KLUWER UNITED STATES, INC.; and WALGREENS COMPANY, Defendants (GlaxoSmithKline LLC, f/k/a SmithKlineBeecham Corporation, d/b/a SmithKlineBeecham, Defendant-Appellant).

         Appeal from the Circuit Court of Cook County. No. 2014 L 006985 The Honorable Larry G. Axelrood, Judge Presiding.

          JUSTICE GORDON delivered the judgment of the court, with opinion. Justices Lampkin and Burke concurred in the judgment and opinion.



         ¶ 1 In this lawsuit, eight minor plaintiffs from six states, including Illinois, filed a products liability suit in the circuit court of Cook County against defendant GlaxoSmithKline LLC (GSK), a pharmaceutical company, and others. The suit alleges that the minor plaintiffs suffered catastrophic birth defects as a result of their mothers' ingestion of defendant GSK's psychiatric drug, Paxil. Defendant GSK moved to dismiss the claims of the out-of-state plaintiffs due to lack of personal jurisdiction, arguing that the court lacked both general and specific jurisdiction.

         ¶ 2 However, the trial court found that Illinois had specific personal jurisdiction over defendant GSK based on (1) defendant GSK's substantial in-state contacts, namely its contracts with 17 Illinois physicians to run 18 to 21 clinical trials on Paxil in Illinois as part of a multicenter study and (2) the fact that plaintiffs' claims arose from defendant GSK's acts or omissions related to those trials. On this permissive interlocutory appeal, pursuant to Illinois Supreme Court Rule 306(a)(3), defendant GSK argues that the trial court erred in denying its motion to dismiss the out-of-state plaintiffs' claims due to lack of personal jurisdiction. Ill. S.Ct. R. 306(a)(3) (eff. July 1, 2014) ("[a] party may petition for leave to appeal *** from an order of the circuit court denying a motion to dismiss on the grounds that defendant has done nothing which would subject defendant to the jurisdiction of the Illinois courts"). For the following reasons, we affirm.

         ¶ 3 BACKGROUND

         ¶ 4 I. Parties

         ¶ 5 The 16 plaintiffs in this case are eight minor plaintiffs and their mothers. In the discussion below, we refer to a minor plaintiff and his or her mother as a "mother-child pair." Two pairs are residents of Illinois, two pairs are residents of Florida, and the four remaining pairs reside in Colorado, Virginia, Michigan, and Wisconsin, respectively.

         ¶ 6 Defendant GSK is a limited liability company incorporated in Delaware, and its sole member, GSK Holdings Inc., is a Delaware corporation with its principal place of business in Delaware. Defendant GSK also has corporate and administrative headquarters in Pennsylvania and North Carolina.

         ¶ 7 II. Complaint

         ¶ 8 On July 2, 2014, plaintiffs filed a complaint that names the following as defendants: (1) GSK (f/k/a SmithKlineBeecham Corporation, d/b/a SmithKlineBeecham), the pharmaceutical company that designed, tested, manufactured, and sold the drug Paxil; (2) Wolters Kluwer Health, Inc. (WKH), and Wolters Kluwer United States, Inc. (WKUS), the companies that provided drug information about Paxil to pharmacies; and (3) Walgreen Co. (Walgreens), the company that sold Paxil to some of the plaintiffs. Only GSK brings this appeal. Against defendant GSK, plaintiffs' complaint sets forth six counts: (1) strict liability and failure to warn, (2) strict products liability and design defect, (3) negligence, (4) breach of implied warranty, (5) breach of express warranty, and (6) negligent misrepresentation and concealment.

         ¶ 9 Plaintiffs claim that the mothers' ingestion of Paxil-a branded paroxetine prescription drug that treats depression, obsessive compulsive disorder, and anxiety-caused catastrophic congenital birth defects, including heart abnormalities. Plaintiffs allege that the design of Paxil, its inadequate warnings, and the manner in which its risks were communicated to the mothers, rendered the drug defective. Moreover, plaintiffs allege that "[d]efendants failed in their acts and omissions related to [Paxil] to use reasonable care to avoid injuring Plaintiffs" and "breached implied and express warranties accompanying [its] sale *** to each mother Plaintiff." Plaintiffs allege that, collectively, the "defective nature of [Paxil] and Defendants' negligent conduct and breach of implied and express warranties proximately caused the minor Plaintiffs to develop birth defects" in the form of severe and permanent structural and functional abnormalities.

         ¶ 10 Plaintiffs allege that, at the time that each mother was prescribed Paxil, defendant GSK knew that there was a "significantly increased risk of congenital defects in babies whose mothers ingested" the drug. Such knowledge was "scientifically knowable through appropriate research and testing." Plaintiffs allege that the Food and Drug Administration (FDA) requires defendant GSK "to issue stronger warnings whenever there existed reasonable evidence of an association between a serious risk and [Paxil]." Despite defendant GSK's opportunity and duty to strengthen the drug's warnings, it "touted [Paxil] as being safe for pregnant women" and "aggressively *** promoted" the drug with labels that inadequately cautioned patients of the associated risk factors, thus, misrepresenting the drug to the public and to the medical profession. The complaint alleges that, had defendant GSK apprised plaintiffs' physicians of Paxil's risks, they would not have "prescribed or permitted" plaintiffs to use the drug. Likewise, had defendant GSK provided timely and "adequate warnings regarding the risks" of Paxil, plaintiffs would not have ingested the drug.

         ¶ 11 Plaintiffs also argue (1) that defendant GSK "failed to conduct appropriate tests to generate the necessary scientific data regarding the strength of the association between [Paxil] and birth defects"; (2) that defendant GSK "represented that Paxil was safe" when it knew or should have known of Paxil's dangerous impact on in utero development because such results were "scientifically knowable" through appropriate research; (3) that defendant GSK neglected to conduct adequate preclinical, clinical, and postmarketing surveillance to determine whether Paxil was safe for its intended or foreseeable uses; and (4) that defendant GSK "intentionally conceal[ed], " "failed to disclose, " and "negligently manipulated" clinical data that demonstrated Paxil's risks of birth defects. The complaint alleges that, as a direct result of defendant GSK's acts and omissions, plaintiffs sustained severe and permanent disfigurement, pain, suffering, and disability.

         ¶ 12 III. Motion to Dismiss

         ¶ 13 On August 7, 2014, defendant GSK moved to dismiss the out-of-state plaintiffs' claims due to a lack of personal jurisdiction, both general and specific, under sections 2-301 and 2-619 of the Code of Civil Procedure. 735 ILCS 5/2-301, 2-619 (West 2012). First, defendant GSK argued that it was not subject to general jurisdiction because Illinois is neither the state of its incorporation nor its principal place of business. Defendant GSK argued that it was not rendered "at home" in Illinois by its business activities here, under the United States Supreme Court's recent decision in Daimler AG v. Bauman, 571 U.S.___, ___, 134 S.Ct. 746, 749 (2014).

         ¶ 14 Second, defendant GSK argued that Illinois lacks specific jurisdiction[1] because the out- of-state plaintiffs' claims did not arise from its Illinois activities. Moreover, defendant GSK claimed that its actions or omissions in Illinois were not the "but for" cause of the alleged harm: plaintiffs did not serve as study subjects in Illinois, did not receive Paxil prescriptions in Illinois, did not ingest Paxil in Illinois, and did not suffer injury from Paxil in Illinois. Finally, defendant GSK argued that the out-of-state plaintiffs may not create personal jurisdiction by tacking their claims onto those of the two Illinois plaintiffs.

         ¶ 15 IV. Discovery

         ¶ 16 In the responses to plaintiffs' interrogatories, it was revealed that defendant GSK employed 16, 323 people in the United States, 217 people who resided in Illinois, and it maintained an agent for service of process in Illinois. Defendant GSK's 2013 gross trade sales revenue for all products in the United States was $15, 558, 745, 381.17, but it did "not collect *** data for gross revenue *** at the state level." Defendant GSK also disclosed that it currently has 184 sales representatives who market GSK's products in Illinois. Between the years 2000 and 2006, defendant GSK had anywhere between 79 and 121 employees marketing specifically Paxil in Illinois. Defendant GSK conducted 18 preclinical and clinical studies on Paxil in Illinois. An excerpt from one of these studies stated:

"Subjects who became pregnant during the study were to be withdrawn from the study immediately. Subjects were instructed to notify the investigator if it was determined after completion of the study that they became pregnant either during the treatment phase of the study or within 30 days. Whenever possible, a pregnancy was to be followed to term, any premature terminations reported, and the status of the mother and child was to be reported to the sponsor after delivery."

         ¶ 17 V. Plaintiffs' Response to Defendant GSK's Motion to Dismiss

         ¶ 18 On November 21, 2014, plaintiffs filed a response to defendant GSK's motion to dismiss. While the out-of-state plaintiffs were not domiciled, prescribed Paxil, or injured in Illinois, they argued that their claims arose directly out of or related to defendant GSK's purposeful contacts with Illinois-that is, defendant GSK's 18 to 21[2] "inadequate and manipulated" Paxil clinical trials in Illinois, conducted by 17 physicians in Illinois on a continuous basis spanning nearly two decades, from 1985 to 2003. Plaintiffs claimed that, in addition to these trials, defendant GSK collaborated on another Paxil clinical trial that occurred exclusively in Illinois between 2001 and 2003. Finally, plaintiffs argued that they have a separate and independent basis for exercising personal jurisdiction because defendant GSK's "conduct in Illinois is the same as its conduct in other states-and that conduct gave rise to the out-of-state Plaintiffs' claims." In other words, the nonresident plaintiffs' claims are based on "the same alleged wrongs as the claims of the Illinois resident Plaintiffs."

         ¶ 19 In their surresponse opposing defendant GSK's motion to dismiss, plaintiffs claimed: "[(1)] that GSK contracted with at least 17 principal investigators in Illinois to conduct clinical trials in Illinois regarding Paxil; [(2)] that the clinical trials resulted in at least eighteen pregnancies; [(3)] that GSK largely failed to track the outcomes of the pregnancies; [(4)] that of the few pregnancy outcomes that GSK did learn, there were fetal abnormalities, including a heart abnormality; and [(5)] that GSK failed to consider any of the pregnancy outcome data in assessing the safety of Paxil to unborn children."

         ¶ 20 VI. Argument

         ¶ 21 On June 10, 2015, the trial court heard argument on defendant GSK's motion to dismiss. Defense counsel argued that it was not subject to suit in Illinois, but only in Delaware, the state of defendant GSK's incorporation; in North Carolina and Pennsylvania, the states where defendant GSK "might be" "at home"; and in the states where the nonresident plaintiffs were injured. Defense counsel conceded purposeful contacts when he said, "no one disputes that GSK had purposeful contacts with Illinois."

         ¶ 22 However, defense counsel argued that plaintiffs' claims did not arise out of defendant GSK's contacts in Illinois, specifically, because Paxil clinical trials took place in 44 states and abroad. When the trial court asked defense counsel, "would [you] say that each of [the] 44 states would not be appropriate place[s] for [jurisdiction]?" he responded, "that would be our position." Defendant GSK argued that by emphasizing 17 of the 361 trials that it conducted in Illinois-or 100 of the 4272 clinical trial patients that took Paxil in Illinois-plaintiffs focused on "a tiny sliver" of the trials and drained all meaning from specific jurisdiction. The trial court responded: "What if [Illinois] had 1/10 of 1 percent [of the total trials], but it was that data that skewed the entire interpretation of the tests? How do I know? What's the magic number *** of [trials] that have to be conducted in Illinois in order to have specific jurisdiction?" "[Am I] trying to figure out where the best location for this litigation is, or whether or not there's a significant nexus to Illinois?"

         ¶ 23 Neither defense counsel nor plaintiffs' counsel were able to suggest a bright-line test for the number of Illinois trials that would give rise to personal jurisdiction in Illinois, but defense counsel argued that 17 trials was insufficient, whereas plaintiffs' counsel argued them sufficient. The trial court stated there was "no definitive number, " so it "must look at it in terms of a pleading." Finally, defense counsel argued that plaintiffs' doctors and witnesses are out-of-state, but the trial court replied: "We have out of state witnesses every day."

         ¶ 24 In reply, plaintiffs argued that the "arising from" and "related to" standard is "lenient and flexible." Plaintiffs' claims arose from inadequate Paxil trials conducted in Illinois because the Illinois data "was aggregated with data from [the] other sites to reach statistical significance" and "the record compels the inference that the Illinois principal investigators had input into, and exercised control over, the overall design study protocol and analysis of the aggregate data."

         ¶ 25 However, plaintiffs stressed that they "don't have to prove on this motion *** whether the Illinois clinical trials were defective." They must only "make a prima facie case of personal jurisdiction." Plaintiffs argued that, by contracting with Illinois physicians to run clinical trials on Paxil in Illinois, defendant GSK purposefully availed itself of the state's benefits and that ...

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