Elaine Robinson v. Pfizer, Inc. ( 2017 )

United States Court of Appeals
For the Eighth Circuit
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No. 16-2524
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Elaine Robinson; Helen Psaras; Rebecca Couture; Vanesa Ford; Georgia Lee
Harlan; Claire A. Holmes; Tina Loomis; Juana Miles; Deloris Mitchell; Himilce
Negron; Carol L. Qualls; Rhonda Robinson; Harriet L. Scott; Charlotte L. Shaw;
Susan M. Simcox; Linda C. Tanguay; Violet E. Wyers; Kim Diling; Rebekah
McDonald; Socorro Perez; Cynthia Weddle; Mary Higdon; Yolanda Baker;
Priscilla Billingslea; Yiona Bryant; Diane Ezell; Janet Gallo; Ladessa Lewis;
Quynh Nguyen; Isabel Power; Denise Proulx; Sharon Wheelehan; Patricia
Herrera; Carol Henriques; Linda Christner; Rita Probst; Patricia Johnson; Lois
Morton; Sharon Bowers; Henrietta Eatman; Sharon Murdock; Mildred Watley;
Delayne Wharton; Patricia Trotman; Gladys Bates; Helen Courtney; Myrtle
White-Royes; Carol Peterson; Elena Barnovics; Victoria Elleman; Eleftheria
Karamihalis; Linda L. Jackson; Gladys F. Brent; Mary Robinson; Martha Farr;
Eliza Taylor; Rose Rush-Gaswirth; Ardell R. Martinez; Carol A. Moran; Lou
Anne Box; Barbara L. Kuikahi; Elizabeth A. Parks-McDonald; Willie Williams;
Clara Yarborough
lllllllllllllllllllll Plaintiffs - Appellees
v.
Pfizer, Inc.
lllllllllllllllllllll Defendant - Appellant
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Washington Legal Foundation; American Tort Reform Association; Missouri
Organization of Defense Lawyers; Chamber of Commerce of the United States of
America; Pharmaceutical Research and Manufacturers of America
lllllllllllllllllllllAmici on Behalf of Appellant(s)
National Consumer Law Center; National Association of Consumer Advocates;
Public Justice; American Association for Justice
lllllllllllllllllllllAmici on Behalf of Appellee(s)
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Appeal from United States District Court
for the Eastern District of Missouri - St. Louis
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Submitted: April 5, 2017
Filed: May 1, 2017
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Before SMITH, Chief Judge, ARNOLD and SHEPHERD, Circuit Judges.
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ARNOLD, Circuit Judge.
Elaine Robinson is one of 64 women from 29 states who sued Pfizer in a
Missouri state court, asserting state-law claims that arose from Pfizer's manufacture
and sale of the drug Lipitor, which they allege causes diabetes. Pfizer removed the
case to federal district court,1 maintaining that the case lay within its diversity
jurisdiction even though the face of the complaint revealed that six of the plaintiffs
are citizens of New York where Pfizer is also a citizen. Complete diversity of
citizenship, and thus federal subject-matter jurisdiction, therefore appeared to be
lacking. See Hubbard v. Federated Mut. Ins. Co., 799 F.3d 1224, 1227 (8th Cir.
2015). But Pfizer defended the removal by urging the district court to ignore the
plaintiffs who are not Missouri citizens when ruling on the diversity issue because
those plaintiffs had been fraudulently joined or procedurally misjoined in the case.
1
The Honorable Carol E. Jackson, United States District Judge for the Eastern
District of Missouri.
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In support, Pfizer contended that those plaintiffs could not acquire personal
jurisdiction over Pfizer in Missouri state court for incidents that did not arise out of
or relate to Pfizer's contacts in Missouri, and so complete diversity of citizenship did
exist after all.
The plaintiffs asked the district court to remand the case to state court and to
award them costs and attorney's fees under 28 U.S.C. § 1447(c), arguing that Pfizer
had removed the case "in bad faith and . . . only to delay the administration of justice
and waste the Court's time and resources" and had engaged in a "pattern of procedural
abuse and continued disregard for binding Eighth Circuit precedent and, more
importantly the time and resources of this District." The district court granted the
motion to remand, but, more important for present purposes, it awarded the plaintiffs
$6200 of their requested $14,800 in attorney's fees. In doing so, the district judge
noted that several cases in her district, some of which involved Pfizer as a defendant,
had already rejected the contentions that Pfizer advanced to justify removing the case.
So, the court concluded, "[i]n light of these repeated admonishments and remands to
state court for six years, defendant can no longer argue that its asserted basis for
seeking removal to federal court in these circumstances is objectively reasonable."
We do not ordinarily have occasion to rule on the propriety of district court
remand orders because they are not reviewable on appeal or otherwise. See 28 U.S.C.
§ 1447(d). Parties can, however, appeal an order awarding attorney's fees for
improper removal under § 1447(c), see Garbie v. DaimlerChrysler Corp., 211 F.3d
407, 410 (7th Cir. 2000), which provides that a remand order "may require payment
of just costs and any actual expenses, including attorney fees, incurred as a result of
the removal." The Supreme Court has held that these appeals turn on whether the
removing party had an objectively reasonable basis for removing the case. Martin v.
Franklin Capital Corp., 546 U.S. 132, 136 (2005). Pfizer appeals the district court's
order awarding attorney's fees and maintains that its removal was in fact objectively
reasonable. As part of our consideration of whether removal was objectively
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reasonable, Pfizer and several amici curiae request that we address Pfizer's arguments
for removal to help lower courts (particularly in the Eastern District of Missouri)
resolve removal issues because many similar pharmaceutical actions have been filed
and will otherwise continue to be filed in the Missouri state court involved here.
Pfizer and these amici maintain that a decision on the diversity-jurisdiction issue
could help end, as one amicus puts it, the "hub of litigation tourism" that the Missouri
state court has become.
After Pfizer filed its notice of appeal, the plaintiffs filed a satisfaction of
judgment in the district court asserting that they "disclaimed any interest in
collecting" the attorney's fee award and that "full and complete satisfaction of said
judgment or order is hereby acknowledged." They then filed a motion to dismiss the
appeal as moot, which Pfizer opposed.
Pfizer contends that we should deny the motion to dismiss because the
plaintiffs filed it too late. Our rules provide that, "Except for good cause or on the
motion of the court, a motion to dismiss based on jurisdiction must be filed within 14
days after the court has docketed the appeal." 8th Cir. R. 47A(b). Although the
plaintiffs did not move to dismiss the appeal until 20 days after it was docketed, the
case did not present a mootness issue until they filed the satisfaction of judgment, and
they filed their motion to dismiss only six days after that. We think that in these
circumstances the plaintiffs had good cause for filing the motion to dismiss more than
14 days after docketing. More important, regardless of our Rule 47A(b), we cannot
decide a moot case. So we turn to the merits of the motion.
Under Article III, an actual controversy must exist at all stages of review, and
if intervening circumstances moot the controversy, the case must be dismissed. See
Campbell-Ewald Co. v. Gomez, 136 S. Ct. 663, 669 (2016). A case becomes moot
when it becomes impossible for the court to grant any effectual relief. See id.
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For the reasons that follow, we feel constrained to agree with the plaintiffs that
the filing of the satisfaction of judgment has mooted the appeal. We cannot relieve
Pfizer of an obligation to pay the fee award because that obligation has already been
extinguished, and we cannot order the plaintiffs to refund the fee award because
Pfizer has not paid it. It follows that all the court can do at this point is give Pfizer an
advisory opinion on the propriety of its removal, and it goes without saying that
advisory opinions are not within our Article III power. See Greenman v. Jessen, 787
F.3d 882, 891 (8th Cir. 2015).
Relying on Perkins v. General Motors Corp., 965 F.2d 597 (8th Cir. 1992),
Pfizer insists that the plaintiffs' disclaimer of the award does not moot the case
because the mere existence of the order appealed from harmed Pfizer's reputation. In
Perkins, a party and her attorney appealed a district court order refusing to vacate a
sanctions order and also sought a writ of mandamus ordering the district court to lift
the sanctions. The appellants argued that the district court lost jurisdiction to enforce
the order when the parties settled the case, but we rejected that contention even
though, as part of the parties' settlement, the appellee had agreed not to collect the
monetary sanctions. We explained that, though the appellee moved for sanctions, "it
was the district court that imposed them. Appellants are entitled to bargain with
adversaries to drop a motion for sanctions, but they cannot unilaterally bargain away
the court's discretion in imposing sanctions and the public's interest in ensuring
compliance with the rules of procedure." Id. at 599–600.
We conclude that Perkins is beside the point because we do not believe that the
district court's award of attorney's fees in this circumstance can reasonably be called
a sanction or could have discernibly harmed Pfizer's reputation. Although the
plaintiffs' rather vivid motion for fees contained a lot of accusatory language directed
at Pfizer and maintained that Pfizer had engaged in sanctionable conduct, we think
it is important that the district court did not take the bait: The court's order merely
held, applying Martin, that Pfizer's removal was not objectively reasonable in light
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of repeated admonitions in similar cases involving similar issues. This is not much
of a rebuke, barely more than a statement that Pfizer had simply erred as a matter of
law.
Pfizer maintains that every attorney's fee award under § 1447(c) is a sanction
capable of harming a party's reputation. That argument is untenable. The statute is
neutral with respect to a party's behavior; it does not remotely suggest that every
attorney's fee award under § 1447(c) can be described as a sanction or that the party
removing the case has acted in a reprehensible way. The Supreme Court more than
intimated as much in Martin, where it consistently referred to this portion of
§ 1447(c) as a "fee-shifting" statute. 546 U.S. at 139–40. In deciding when a court
should award attorney's fees under § 1447(c), moreover, the Martin Court expressly
rejected the proposition that fees should be awarded only when the removal was
"frivolous, unreasonable, or without foundation." Id. at 138–39. Had it adopted that
standard, we might be more inclined to say that an attorney's fee award under
§ 1447(c) is categorically a sanction, but instead the Martin Court adopted a much
more anodyne standard. At least one other court has expressly held, we think
correctly, that § 1447(c) is not a sanctions rule but merely a fee-shifting statute. See
Garbie, 211 F.3d at 410.
Pfizer also directs our attention to a case in which we decided that a bankruptcy
court had sanctioned a party when it said in an order that the party had violated an
automatic statutory stay. See U.S. Through Farmers Home Admin. v. Nelson, 969 F.2d
626, 629 (8th Cir. 1992). We explained that "an adjudication that the [party] was in
violation of federal law is indeed a sanction, and one that the [party] should be
permitted to seek to reverse on appeal," even where no monetary penalties were at
issue. Id. But unlike Nelson, the district court here did not find that there was a
violation of federal law; it merely found that the removal was not objectively
reasonable. Nelson is therefore inapposite. Pfizer in addition points to occasions on
which our court has referred to attorney's fee awards under § 1447(c) as "sanctions."
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See Dakota, Minn. & E. R.R. Corp. v. Schieffer, 715 F.3d 712, 712 (8th Cir. 2013);
Johnson v. AGCO Corp., 159 F.3d 1114, 1116 (8th Cir. 1998). But these cases are far
from holding that all attorney's fee awards under § 1447(c) are sanctions, especially
since the proper characterization of § 1447(c) awards was not actually at issue in
those cases. We think that some attorney's fee awards under § 1447(c) are not truly
sanctions that could harm a party's reputation, and we think that the award here is one
of them.
Pfizer also insists that it has suffered an injury because the order at issue
discourages it from removing cases in the future since a district court might now be
more inclined to award attorney's fees for an unreasonable removal. Pfizer's argument
fails because we do not think that the chilling effect Pfizer posits will materialize
since Pfizer would get another chance of getting an opinion on the propriety of
similar removals should a district court award attorney's fees again. And in a case
where attorney's fees are actually at issue on appeal, Pfizer could receive a ruling on
the propriety of removal that it now so earnestly seeks. The incentives are currently
structured so that plaintiffs' attorneys in these types of cases will no longer ask for
attorney's fees for fear that a pharmaceutical company like Pfizer will appeal a fee
award and receive a decision that might end their lucrative procedural strategy. And
Pfizer will have little difficulty with being ordered to pay relatively modest attorney's
fee awards if that gives it the opportunity to defeat the plaintiffs' strategy for good.
We therefore reject Pfizer's contention that it will be discouraged from removing
cases in the future; it is actually more likely to remove a case in the future based on
these incentives. In sum, this case is moot because we cannot provide Pfizer any relief
outside of an advisory opinion.
Once a case pending appeal becomes moot, federal appellate courts may
dispose of the case as justice may require. See U.S. Bancorp Mortg. Co. v. Bonner
Mall P'ship, 513 U.S. 18, 21–22 (1994). The established practice of federal appeals
courts is to vacate the judgment or order being appealed because that "clears the path
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for future relitigation of the issues between the parties and eliminates a judgment."
Id. at 22. Though courts are sometimes reluctant to vacate a judgment or order being
appealed when one or more of the parties caused the case to become moot, see id. at
23, those concerns are not present when the prevailing party below unilaterally moots
the case. Otherwise the prevailing party could solidify a decision as precedent or
create a preclusive effect without that decision being subjected to appellate review.
See 13C Charles Alan Wright et al., Federal Practice & Procedure § 3533.10.1 (3d ed.
2008). Given that an order of vacatur is the usual course, that all parties agree that
vacatur is proper, and that vacatur would go a long way toward repairing any possible
harm that Pfizer claims it suffered, we vacate the district court's order directing Pfizer
to pay attorney's fees.
Dismissed.
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