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In re Zofran (Ondansetron) Products Liability Litigation

United States District Court, D. Massachusetts

June 13, 2019

IN RE: ZOFRAN (ONDANSETRON) PRODUCTS LIABILITY LITIGATION
v.
GLAXOSMITHKLINE LLC, This Document Relates to: THOMAS BROWN, et al.,

          MEMORANDUM AND ORDER ON PLAINTIFFS' MOTION TO REMAND

          F. Dennis Saylor IV United States District Judge.

         This case is part of a multi-district litigation proceeding arising out of claims that the use of the drug Zofran (ondansetron) by pregnant women caused birth defects. Plaintiffs Thomas Brown and Maria Del Carmen Espindola Gomez originally filed suit in Oregon state court against defendants GlaxoSmithKline, LLC (“GSK”) and Providence Health System-Oregon d/b/a Providence Newberg Medical Center f/k/a Providence Newberg Hospital (“Providence”) alleging that Espindola Gomez's use of Zofran during pregnancy caused congenital heart defects in her child.

         This case is before the Court for a second time, having been removed, transferred to this MDL proceeding, and then remanded three years ago. See Brown, et al. v. GlaxoSmithKline, LLC, et al., 16-cv-10215-FDS. Upon remand, and after two more years of litigation in Oregon state court, the claims against Providence were dismissed following a successful motion for summary judgment. That prompted GSK to remove the case to federal court for a second time. Plaintiffs have again moved to remand, contending that the removal was untimely and barred by the “voluntary-involuntary” doctrine. With plaintiffs' motion to remand pending, the Judicial Panel for Multidistrict Litigation (“MDL Panel”) once again transferred the case to this district.

         For the following reasons, and having considered the issue with the benefit of the state court's summary-judgment record, plaintiffs' motion to remand will be granted.

         I. Background

         Defendant GSK distributed and sold the drug ondansetron under the brand name Zofran. Zofran was first approved in 1991 for the prevention of post-operative nausea and vomiting associated with anesthesia and for nausea and vomiting caused by radiotherapy and chemotherapy. In addition to those approved uses, GSK is alleged to have marketed Zofran “off-label” for pregnancy-related nausea and vomiting, commonly known as “morning sickness.” Plaintiffs in this multidistrict litigation allege that Zofran was in fact unsafe for use in pregnant women, and that in utero exposure to Zofran caused birth defects in children born to mothers who took the drug. This particular action involves the claims of two plaintiffs: Thomas Brown and Maria Del Carmen Espindola Gomez, who are the parents of M.B. Plaintiffs sued both GSK, the manufacturer of Zofran, and Providence, a hospital located in Oregon that dispensed Zofran to Espindola Gomez.

         On August 28, 2015, plaintiffs filed a complaint in Oregon state court. The complaint named GSK and Providence as defendants, and alleged seven counts arising out of congenital heart defects suffered by M.B. and allegedly caused by Espindola Gomez's use of name-brand Zofran during pregnancy. Three of those claims were brought against Providence: strict liability (Count Three); negligent misrepresentation (Count Five); and loss of consortium (Count Seven).

         In October 2015, GSK removed the action to the United States District Court for the District of Oregon based on a facial challenge to the complaint, contending that Providence's citizenship should be ignored for diversity jurisdiction purposes because it was fraudulently joined. Plaintiffs moved to remand the case for lack of subject-matter jurisdiction due to a lack of complete diversity of citizenship among the parties. On January 5, 2016, the district court stayed the case pending its transfer to this district by the MDL Panel for consolidation pursuant to 28 U.S.C. § 1407.

         The case was transferred by the MDL Panel to this district in February 2016. On April 21, 2016, plaintiffs renewed their motion to remand. GSK opposed remand on the ground that complete diversity existed based on the doctrine of fraudulent joinder.

         The Court granted the motion to remand on June 16, 2016. It observed that under Oregon law, strict liability may attach to a “seller” of a product in a defective condition, unreasonably dangerous to the user or consumer, if the seller “is engaged in the business of selling” such a product. Or. Rev. Stat. Ann. § 30.920(1). At the time, the Oregon Supreme Court had not decided the issue of whether a healthcare provider such as a hospital may be held liable on a strict-liability claim as a “seller” of a prescription drug. However, at least two federal courts in the District of Oregon had held that such a products-liability claim against a healthcare provider may, in fact, be viable under Oregon law. Thus, and in the absence of any controlling Oregon authority, the Court concluded that there was at least a “reasonable possibility” that the Oregon Supreme Court would recognize a strict-liability claim against a healthcare provider that dispensed a pharmaceutical product. See Universal Truck & Equip. Co. v. Southworth-Milton, Inc., 765 F.3d 103, 108 (1st Cir. 2014). The Court also concluded that the allegations in the complaint, although sparse, appeared sufficient to meet the statutory requirement that Providence was in the “business of selling” Zofran as required by the statute.

         The parties then litigated the case for two more years in Oregon state court. Plaintiffs' claims against Providence survived a motion to dismiss in December 2016, and the parties proceeded to discovery. At the close of discovery, Providence moved for summary judgment on the two remaining claims against it: strict liability and negligent misrepresentation.[1]

         As to the strict-liability claim, Providence contended that plaintiffs had no basis for their claims that the hospital “sold” Zofran to Espindola Gomez. It supported that contention with, among other things, the following undisputed facts:

• “[Providence] had an inpatient pharmacy located within the hospital facility which stocked a wide range of pharmaceuticals for administration to a patient upon the order of a physician on its medical staff.” (Providence's Mot. for Partial Summary Judgment at 9).
• “[Providence] dispensed pharmaceuticals as part of its provision of medical services to patients at the hospital only and was not in the business of selling Zofran injectable or other medications to the public.” (Id.).
• “[Providence] [did not] market or advertise Zofran injectable or any other medications for sale.” (Id.).
• “[Providence] was prohibited by state and federal law from selling medications to patients after discharge from the hospital.” (Id.).
• “A person such as plaintiff [Espindola] Gomez could not just come in to [Providence] and purchase Zofran injectable.” (Id.).

         Plaintiffs opposed the motion as to the strict-liability claim, contending that “Providence was engaged in the business of selling Zofran and that defendant sold, distributed, vended, administered and/or supplied the Zofran which caused the injuries at issue in this case.” (Pls.' Resp. at 7). They supported that contention with, among other things, the following undisputed facts:

• “[Providence's] in-house pharmacy vended [Zofran].” (Id. at 2).
• “[Providence] billed both Ms. Espindola Gomez's insurer and Ms. Espindola Gomez herself for the drug.” (Id. at 3).
• “Ms. Espindola Gomez signed a document . . . entitled, ‘Condiciones de Servicio' (‘Conditions of Service'), ” wherein she “agree[d] to pay for the services or products provided by Providence Health System.” (Id.) (emphasis added). That agreement specified that “Providence Health System includes hospitals, clinics, ambulatory services, home and community services, retail pharmacies and convalescent centers.” (Id. at 4) (emphasis added).

         Plaintiffs voluntarily dismissed their negligent-misrepresentation claim during oral argument on October 29, 2018.[2] Ruling from the bench on the strict-liability claim, Judge Silver concluded that “in this particular case, under these facts, ” Providence was not in the business of selling Zofran. Judge Silver specifically observed:

. . . I can't find, under the specific facts of this case, that the hospital was engaged in the business of selling Zofran. There certainly could be scenarios in which a hospital could be found to be engaged in the business of selling a particular drug. But under the facts of this case, . . . I don't believe that the . . . intent of the legislature ...

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