Suzanne Ivie v. Astrazeneca Pharmaceuticals Lp ( 2023 )

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS MAY 19 2023
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
SUZANNE IVIE, No. 21-35978
Plaintiff-Appellant, D.C. No. 3:19-cv-01657-JR
v.
MEMORANDUM*
ASTRAZENECA PHARMACEUTICALS
LP,
Defendant-Appellee.
Appeal from the United States District Court
for the District of Oregon
Jolie A. Russo, Magistrate Judge, Presiding
Argued and Submitted November 8, 2022
Portland, Oregon
Before: CLIFTON and BUMATAY, Circuit Judges, and BAKER,** International
Trade Judge. Dissent by Judge BUMATAY.
Plaintiff-Appellant Suzanne Ivie appeals the district court’s order granting the
Federal Rule of Civil Procedure 50(b) renewed motion for judgment as a matter of
law (“JMOL”) filed by Defendant-Appellee AstraZeneca Pharmaceuticals, LP,
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The Honorable M. Miller Baker, Judge for the United States Court of
International Trade, sitting by designation.
vacating a jury verdict for Ivie, and ruling that she had failed to present factual evi-
dence establishing enough of a connection to Oregon for the state’s whistleblower
statute, ORS § 659A.199, to apply to her claims. We have appellate jurisdiction un-
der 28 U.S.C. § 1291 and we reverse.
This case presents a straightforward matter of civil procedure. Ivie asserts that
AstraZeneca forfeited or waived its “Oregon-nexus argument” by failing to raise it
in the parties’ joint pretrial order or at any time prior to its initial JMOL motion
brought at the close of Ivie’s case.1 AstraZeneca responds that it was not obligated
to raise the defense in the pretrial order because a defendant need not include “neg-
ative defenses” as to which the plaintiff has the burden of proof and because the
pretrial order included the general theory that “AstraZeneca denies that Ivie is enti-
tled to any legal or equitable relief.”
1. We agree with Ivie. District of Oregon Local Civil Rule 16-5, “Proposed
Pretrial Order,” requires the parties to submit “a proposed order to frame the issues
for trial” that includes, inter alia, “[a] statement of each claim and defense to that
claim with the contentions of the parties. Contentions . . . will be sufficient to frame
the issues presented by each claim and defense.” D. Or. Loc. R. 16-5(b)(4). “The
pretrial order amends the pleadings, and it, and any later order of the Court[,] will
control the subsequent course of the action or proceedings as provided in Fed. R.
1
We do not resolve whether AstraZeneca’s failure was a forfeiture or a waiver.
2
Civ. P. 16.” Id. 16-5(d); see also Fed. R. Civ. P. 16(d) (providing that pretrial order
“controls the course of the action unless the court modifies it”), 16(e) (“The court
may modify the [pretrial] order issued after a final pretrial conference only to avoid
manifest injustice.”).
We have repeatedly emphasized that “a party may not ‘offer evidence or ad-
vance theories at the trial which are not included in the [pretrial] order or which
contradict its terms.’” El-Hakem v. BJY Inc., 415 F.3d 1068, 1077 (9th Cir. 2005)2
(quoting United States v. First Nat’l Bank of Circle, 652 F.2d 882, 886 (9th Cir.
1981)). This requirement extends to “any and all theories,” id., which means that
“[a] defendant must enumerate its defenses in a pretrial order even if the plaintiff
has the burden of proof,” id. (citing S. Cal. Retail Clerks Union v. Bjorklund, 728
F.2d 1262, 1264 (9th Cir. 1984)).
AstraZeneca’s frank admission that it failed to include the negative “Oregon-
nexus” defense in the pretrial order resolves whether its Rule 50(b) motion raised a
theory outside of the scope of that order. While AstraZeneca contends, citing El-
Hakem, that its general denial was sufficient to alert Ivie that it would assert the
2
The dissent’s reliance on El-Hakem is unpersuasive. El-Hakem specifically ex-
plains that the implicit modification was acceptable because no party was prejudiced.
Id. The modification there raised an “identical” defense that was already at issue in
the case. Id. El-Hakem expressly distinguished that situation from a case—like the
one before us—where a party “fail[s] to include any reference to the [new issue] in
the pretrial order.” Id. (emphasis in original).
3
“Oregon-nexus” defense such that she should prepare for it, a general denial does
not alert anyone to anything beyond the utterly broad (and obvious) theory that the
defendant believes the plaintiff should lose, and AstraZeneca simply ignores El-
Hakem’s requirement that negative defenses must appear in the pretrial order to
avoid forfeiture or waiver.3
2. AstraZeneca defends the district court’s JMOL order on the alternative
ground that the court implicitly exercised its discretion to modify the final pretrial
order to “prevent manifest injustice.” Fed. R. Civ. P. 16(c). Even accepting that char-
acterization of the district court’s JMOL order, Ivie responds that waiting until the
grant of JMOL to modify was too late because it prejudiced her by denying her any
opportunity to respond to the new defense.
We agree. Our cases teach that a district court must “first” modify a pretrial
order before entertaining the presentation of theories outside the scope of that order.
First Nat’l Bank of Circle, 652 F.2d at 886–87. “[P]articular evidence or theories
3
AstraZeneca’s citation of Zivkovic v. Southern California Edison Co., 302 F.3d
1080, 1088 (9th Cir. 2002), is unavailing. In Zivkovic we rejected a plaintiff’s argu-
ment that a defendant waived a “negative defense” by failing to include it in the
answer, but we did not address the issue of including such defenses in the pretrial
order. AstraZeneca’s assertion that Zikovic applies “by extension” to a pretrial order
is simply unpersuasive, as is its further citation of two district court cases referring
to “general denials” as being sufficient at the pleadings stage. A case that advances
to entry of a pretrial order has advanced far beyond the pleadings stage—as, indeed,
the district court’s local rule recognizes by stating that the pretrial order “amends the
pleadings.”
4
which are not at least implicitly included in the [pretrial] order are barred unless the
order is first modified to prevent manifest injustice.” Id. (cleaned up and emphasis
added) (citing Fed. R. Civ. P. 16). Here, even if the district court could be said to
have implicitly modified the pretrial order, it did not do so “before granting” judg-
ment as a matter of law to AstraZeneca. Id. at 887. Insofar as the court implicitly
modified the pretrial order, it abused its discretion by doing so after trial and denying
Ivie any opportunity to alter her trial presentation based on that retroactive modifi-
cation. Denying Ivie that opportunity prejudiced her.
3. AstraZeneca further defends the judgment below on the additional alterna-
tive ground that the issue of geographic connection to Oregon was tried by consent
under Federal Rule of Civil Procedure 15(b). The company argues that because its
counsel mentioned that the events at issue took place outside the Portland area and
asked witnesses about where relevant events occurred, Ivie was somehow on notice
that AstraZeneca interjected the “Oregon-nexus” defense and that she consented to
it by failing to object. This falls far short of what we require to demonstrate amend-
ment of pleadings by implied consent at trial. A party asserting such implied consent
“must demonstrate that [the adverse party] understood evidence had been introduced
to prove [the new issue], and that [the new issue] had been directly addressed, not
merely inferentially raised by incidental evidence.” LaLonde v. Davis, 879 F.2d 665,
5
667 (9th Cir. 1989) (cleaned up and emphasis added). Neither party directly ad-
dressed the geographic-nexus issue at trial.
4. Falling back, AstraZeneca’s last-ditch defense of the judgment below is to
assert the plain error doctrine, the district court’s alternative ground for its decision.
“Plain error is a rare species in civil litigation, encompassing only those errors that
reach the pinnacle of fault . . . .” Hemmings v. Tidyman’s Inc., 285 F.3d 1174, 1193
(9th Cir. 2002) (quoting Smith v. Kmart Corp., 177 F.3d 19, 26 (1st Cir. 1999)).
Among other requirements, plain error review applies only when “needed to prevent
a miscarriage of justice, meaning that the error ‘seriously impaired the fairness, in-
tegrity, or public reputation of judicial proceedings.’” C.B. v. City of Sonora, 769
F.3d 1005, 1019 (9th Cir. 2014) (quoting Diaz-Fonseca v. Puerto Rico, 451 F.3d 13,
36 (1st Cir. 2006)).
Here, even assuming the company’s failure to include the geographic-nexus
defense in the pretrial order was a mere forfeiture subject to plain error review rather
than a waiver not subject to such review, AstraZeneca does not attempt to show that
merely applying the wrong state’s law “seriously impaired the fairness, integrity, or
public reputation of judicial proceedings.” Id. Choice-of-law errors are (regrettably)
a routine occurrence in civil litigation, and we will be very busy indeed on plain
error review if we get into the business of overturning jury verdicts based on such
errors.
6
* * *
We reverse the district court’s order granting AstraZeneca’s renewed motion
for judgment as a matter of law, and we remand with instructions for the court to
consider in the first instance whether the company’s motion for new trial should be
granted on the ground that the damages award was excessive.
REVERSED AND REMANDED.
7
FILED
MAY 19 2023
Suzanne Ivie v. AstraZeneca Pharmaceuticals LP, No 21-35978
Bumatay, J., dissenting: MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
I respectfully dissent from the majority’s decision. I would have left the
decision on whether AstraZeneca forfeited or waived its argument based on the
presumption against the extraterritoriality of Oregon law in the sound hands of the
district court.
While a pretrial order controls the course of litigation between parties, the
pretrial order should “be liberally construed” to allow theories at trial that are at least
implicitly included in the order. United States v. First Nat. Bank of Circle, 652 F.2d
882, 886 (9th Cir. 1981). A defense is preserved if the pretrial order makes “any
reference to the defense in the pretrial order.” El-Hakem v. BJY Inc., 415 F.3d 1068,
1077 (9th Cir. 2005). Even more to the point, in its discretion, the district court may
modify a pretrial order “to prevent manifest injustice.” Fed. R. Civ. P. 16(e). The
district court may “implicitly exercise[]” this discretion by allowing a party to
advance theories not contained in the pretrial order. El-Hakem, 415 F.3d at 1077.
In this case, the pretrial order did not explicitly identify the lack of nexus to
Oregon as a defense to the Oregon Whistleblower claim. But the district court
construed AstraZeneca’s argument as encompassed in the company’s Answer,
which raised the “failure to state a claim upon which relief can be granted” as an
affirmative defense. AstraZeneca also asserted in the pretrial order that “Ivie is [not]
entitled to any legal or equitable relief” on her Oregon Whistleblower claim. Based
on AstraZeneca’s pleadings, the district court concluded that Ivie had “adequate
notice” of the defense—presumably meaning that Ivie would not be prejudiced by
AstraZeneca’s raising of the defense in the Rule 50(b) motion. That doesn’t seem
wrong—Ivie hasn’t proffered any additional evidence that she would have admitted
at trial if she had more express notice of the extraterritorial defense. The district
court’s ruling then seems to fall within its discretion. El-Hakem, 415 F.3d at 1077(“In the absence of any prejudice to [Plaintiff], we cannot say that the district court
abused its discretion.”).
Even if the extraterritorial defense were not adequately encompassed in the
pretrial order, we should have construed the district court’s ruling as implicitly
modifying the pretrial order. Indeed, the district court expressly found that denying
AstraZeneca its defense would be a “manifest miscarriage of justice.” See Fed. R.
Civ. P. 16(e) (permitting amendment of the pretrial order “to prevent manifest
injustice”). So, by permitting AstraZeneca to argue the extraterritoriality defense in
its Rule 50(b) motion, the district court appropriately—if implicitly—exercised its
discretion to amend the pretrial order under Rule 16(e). See El-Hakem, 415 F.3d at
1077.
The majority asserts that following El-Hakem here is “unpersuasive” because
no party was prejudiced in that case. But the majority identifies no prejudice to Ivie.
2
On the other hand, as the district court found, AstraZeneca would pay a high price
by applying Oregon law improperly. So I’m not sure why El-Hakem doesn’t apply
here. The majority also asserts that the district court needed to “implicitly” modify
the pretrial order before granting the Rule 50(b) motion. Usually, when something
happens “implicitly,” it is not expressly said. See Oxford English Dictionary Online
(defining “implicit” as “[i]mplied though not plainly expressed”). So it is immaterial
that the district court didn’t first announce it was “implicitly” amending the pretrial
order before turning to the Rule 50(b) motion.
On the merits, the district court got it right. As the district court observed,
“Oregon courts have consistently held that statutes must be construed to prohibit
their extraterritorial application unless the language of the statute shows Oregon’s
Legislature intends them to have a broader scope.” Ivie v. AstraZeneca
Pharmaceuticals LP, 2021 WL 5167283, at *3 (D. Or. Nov. 5, 2021) (citing State v.
Meyer, 183 Or. App. 536, 544–45 (2002)). The Supreme Court of Oregon said the
same thing long ago: “No legislation is presumed to be intended to operate outside
of the jurisdiction of the state enacting it.” Swift & Co. v. Peterson, 233 P.2d 216,
228 (Or. 1951). “In fact, a contrary presumption prevails and statutes are generally
so construed.” Id. And I agree with the district court that Ivie has failed to rebut
this presumption and has failed to present sufficient evidence of nexus to Oregon to
sustain the Oregon Whistleblower verdict.
3
I respectfully dissent.
4