Bahamas Surgery Center, LLC v. Kimberly-Clark Corporation et al.

Filing 538

MINUTE (IN CHAMBERS) ORDER TO SHOW CAUSE WHY THE COURT SHOULD NOT IMPOSE SANCTIONS AGAINST THE PARTIES' COUNSEL FOR VIOLATION OF LOCAL RULE 83-1.3.1 by Judge Dolly M. Gee. The parties counsel are hereby ORDERED TO SHOW CAUSE why the Court should not sanction them for violating Local Rule 83-1.3.1. The parties shall file a joint response by June 12, 2017. IT IS SO ORDERED. (See order for details.) (kti)

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No.

Date

CV 14-8390 DMG (PLAx)

June 2, 2017

Title Bahamas Surgery Center, LLC. v. Kimberly-Clark Corporation, et al.
Present: The Honorable

Page

1 of 3

DOLLY M. GEE, UNITED STATES DISTRICT JUDGE

KANE TIEN
Deputy Clerk

NOT REPORTED
Court Reporter

Attorneys Present for Plaintiff(s)
None Present

Attorneys Present for Defendant(s)
None Present

Proceedings: IN CHAMBERS - ORDER TO SHOW CAUSE WHY THE COURT
SHOULD NOT IMPOSE SANCTIONS AGAINST THE PARTIES’
COUNSEL FOR VIOLATION OF LOCAL RULE 83-1.3.1
Local Rule 83-1.3.1 sets forth the requirement that a notice of related civil cases must be
filed under certain circumstances:
It shall be the responsibility of the parties to promptly file a Notice of Related
Cases whenever two or more civil cases filed in this District:
(a) arise from the same or a closely related transaction, happening, or event;
(b) call for determination of the same or substantially related or similar questions
of law and fact; or
(c) for other reasons would entail substantial duplication of labor if heard by
different judges.
L.R. 83-1.3.1 (emphasis added). This rule further states that such a Notice “must be filed at the
time any case . . . appearing to relate to another case is filed, or soon thereafter as it reasonably
should appear that the cases relate to another.” Id.
Here, the low number case is United States of America, et al. v. Kimberly-Clark
Corporation, et al., Case No. CV 14-8313 JAK (JPRx). Based on the following timeline, it
appears that one or more of the parties’ counsel failed to abide by Local Rule 83-1.3.1 at the time
of the filing of Bahamas Surgery Center, LLC v. Kimberly-Clark Corporation, et al., Case No.
CV 14-08390 DMG (PLAx), Medline Industries, Inc. v. Kimberly-Clark Corporation, et al.,
Case No. CV 16-08571 DMG (PLAx), and Naeyaert v. Kimberly-Clark Corporation, et al., Case
No. CV 17-00950 JAK (JPRx).
//

CV-90

CIVIL MINUTES—GENERAL

Initials of Deputy Clerk KT

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No.

CV 14-8390 DMG (PLAx)

Date

June 2, 2017

Title Bahamas Surgery Center, LLC. v. Kimberly-Clark Corporation, et al.
Date
10/27/2014
10/29/2014

10/5/2016
11/17/2016

11/23/2016
4/14/2017

5/16/2017
5/22/2017

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Case Number Event
14-8313
Plaintiff’s counsel files qui tam action under seal and case is
assigned to Judge John A. Kronstadt.
14-8390
Plaintiff’s counsel files putative consumer-fraud class action
lawsuit (“Bahamas”) and case is assigned to Judge Gee. The
parties do not notify the Court of the qui tam action pending
before Judge Kronstadt by filing a notice of related cases.
14-8313
Qui tam action is unsealed.
16-8571
Plaintiff’s counsel files Medline lawsuit and files notice of related
case, mentioning the Bahamas case but not the qui tam case. See
Doc. # 4 (“First, like the present case, the Related Case pertains
to Defendants’ marketing and sale of medical gowns in which the
plaintiffs in both cases allege that Defendants falsely represented
the gowns as passing relevant industry standards for liquid
barrier protection and concealing from purchasers Defendants’
knowledge that these standards had not been satisfied.”). Neither
side’s counsel inform Judge Gee of the pendency of the qui tam
action.
16-8571
Medline matter is transferred from Judge Stephen Wilson to
Judge Gee.
14-8313
Plaintiff’s counsel files a notice of related case in the qui tam
action seeking to relate the low-number qui tam action to the
higher numbered Bahamas and Medline cases assigned to Judge
Gee. See Doc. # 55 at 5, 14-8313 (“the present [qui tam] case
should be assigned to Judge Gee”). Plaintiff’s counsel’s notice
uses language nearly identical to the notice he filed in the
Medline case. Compare Doc. # 55 (“First, like the present case,
the Related Cases [Bahamas and Medline] pertain to KimberlyClark Corporation’s marketing and sale of medical gowns in
which the plaintiffs in all three cases allege that Kimberly-Clark
falsely represented the gowns as passing relevant industry
standards for liquid barrier protection and concealing from
purchasers its knowledge that these standards had not been
satisfied.”) with Doc. # 4, 16-8571.
17-950
Plaintiff’s counsel files a notice of related case seeking to relate
Naeyaert with Bahamas and Medline, but not the qui tam action.
17-950
Judge Kronstadt finds Naeyaert is related to the qui tam action
and accepts the low-number transfer.
CIVIL MINUTES—GENERAL

Initials of Deputy Clerk KT

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES—GENERAL
Case No.

CV 14-8390 DMG (PLAx)

Date

June 2, 2017

Title Bahamas Surgery Center, LLC. v. Kimberly-Clark Corporation, et al.

Page

3 of 3

It is unclear (1) why Plaintiff’s counsel failed to mention the qui tam action in the notice
of related case that he filed in the Medline and Naeyaert matters and (2) why neither side filed a
notice of related case in the Bahamas matter bringing the qui tam action to the Court’s attention.
This is especially troubling since, in his opposition to Defendants’ motion to transfer
venue in Medline, Plaintiff’s counsel now unambiguously asserts that all three cases relate to one
another: “The Bahamas class action is not the only case relating to Defendants’ surgical gowns
that is pending in this judicial district. In October 2014, a qui tam case was filed against
Kimberly-Clark on behalf of government purchasers relating to the sale of MicroCool Gowns
. . . . The very same allegations at issue in [that] case are also being asserted in this case.” See
Medline, Doc. # 40 at 24; see also id. at 13 (“In addition to this case, two other cases related to
and arising out of the same factual allegations made in this case have long been pending in this
judicial district.”).1
The Court is also troubled by Plaintiff’s counsel’s representation that “the Court has
already consented to having the present case [Medline] transferred to it, finding that this case and
the Bahamas class action ‘[a]rise from the same or closely related transactions, happenings or
events,’ ‘[c]all for determination of the same or substantially related or similar questions of law
and fact’ and “for other reasons would entail substantial duplication of labor if heard by different
judges.’” See Medline, Doc. # 40 at 22. The fact is that the Court never received notice that any
potentially related action was pending at the time the Bahamas and Medline actions were filed.
Whether the low-number judge would have accepted or declined the transfer had counsel
promptly filed a notice of related case informing the Court of the qui tam matter is beside the
point. The reason Local Rule 83-1.3.1 exists is to give the Court in the low-numbered case the
opportunity to make that decision in the first instance. 2
The parties’ counsel are hereby ORDERED TO SHOW CAUSE why the Court should
not sanction them for violating Local Rule 83-1.3.1. The parties shall file a joint response by
June 12, 2017.
IT IS SO ORDERED.
cc: Hon. John A. Kronstadt
1

The page number is based on the CM/ECF pagination.

2

See General Order 16-05 at 20 (“The Clerk will present the proposed transfer order to the transferee [lownumber] judge for review and will simultaneously present an informational copy to the transferor judge.”).
CV-90

CIVIL MINUTES—GENERAL

Initials of Deputy Clerk KT