Wells, et al. v. Sorin Group USA, Inc., et al.

Filing 26

ORDER signed by Chief Judge Morrison C. England, Jr., on 9/29/14 ORDERING that Defendants's 20 Motion to Dismiss Plaintiffs' First Amended Complaint is DENIED. (Kastilahn, A)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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ARLENE WELLS and MICHAEL
WELLS,
Plaintiffs,

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v.

No. 2:14-cv-00606-MCE-KJN

MEMORANDUM AND ORDER

SORIN GROUP USA, INC.,
CARBOMEDICS, INC., DEANNA
PAULEY, and DOES 1 through 50,
inclusive,

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Defendants.

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Through the present action, Arlene Wells and Michael Wells (collectively

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“Plaintiffs”) seek redress from Sorin Group USA, Inc., and Carbomedics, Inc.,

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(collectively “Defendants”) for fraudulently providing false medical data to the healthcare

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providers of decedent Gerald Wells. Now before the Court is Defendants’ Motion to

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Dismiss Plaintiffs’ First Amended Complaint (“FAC”). That Motion, brought pursuant to

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Federal Rule of Civil Procedure 12(b)(6),1 is made on grounds 1) that Plaintiffs’ claims

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are barred by their respective statutes of limitations; 2) that the so-called “discovery rule”

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does not save Plaintiffs’ claims from being time barred; 3) that Plaintiffs’ claims are not

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All further references to “Rule” or “Rules” are to the Federal Rules of Civil Procedure unless
otherwise noted.

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alleged with sufficient particularity; and 4) that the claims otherwise do not present a

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plausible claim for relief. For the following reasons, Defendants’ Motion is DENIED.2

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BACKGROUND3

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Plaintiffs Arlene and Michael Wells are the surviving spouse and son of the

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deceased, Gerald Wells. In 2008, Mr. Wells was diagnosed with moderate aortic

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stenosis, and his physician recommended he undergo surgery to have a diseased valve

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replaced. On August 28, 2008, Mr. Wells underwent the valve replacement surgery and

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had his diseased valve replaced with a valve produced by Defendants (“the Valve”).

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The Valve chosen as a replacement by Mr. Wells’ surgeon was a twenty-one

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millimeter mitroflow aortic pericardial bioprothesis heart valve manufactured and

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distributed by Defendants. Mr. Wells’ surgeon relied on a chart provided by Defendants

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(“the Chart”) when choosing the particular Valve to use as a replacement for Mr. Wells.

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The Chart indicated that a twenty-one millimeter valve, such as the one chosen,

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presented only a small likelihood of creating patient-prosthesis mismatch (“PPM”) for

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someone with Mr. Wells’ body surface area (“BSA”).

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In February 2009, Mr. Wells returned to the hospital with symptoms of shortness

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of breath, lack of energy, and chest pains. After evaluations by several doctors, it was

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determined that the Valve was functioning correctly. However, a cardiologist ultimately

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determined that Mr. Wells had severe PPM, and recommended surgery to replace the

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Valve with a larger size valve. On October 5, 2009, Mr. Wells underwent a second

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surgery to replace the twenty-one millimeter Valve with a twenty-three millimeter valve.

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Two days later, Mr. Wells died as a result of severe acidosis, which was a complication

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of the second replacement surgery.

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Because oral argument will not be of material assistance, the Court orders this matter submitted
on the briefs. E.D. Cal. Local Rule 230(g).
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The following recitation of facts is taken, sometimes verbatim, from Plaintiffs’ FAC. ECF No. 18.

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Following Mr. Wells’ death, Plaintiffs filed a demand for arbitration against

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Mr. Wells’ healthcare providers for wrongful death. At that time, Plaintiffs claim they had

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been informed that the Valve had been functioning correctly. During the course of the

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litigation involving the arbitration, Plaintiffs obtained a copy of the Chart previously used

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by Mr. Wells’ surgeon, which indicated the 21-millimeter valve was the proper size.

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Plaintiffs claim that prior to November 23, 2011, they discovered no information through

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their diligent investigation that would have suggested the chart contained false or

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misleading information. Additionally, Plaintiffs allege that prior to their discovery of the

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false and misleading material in the Chart, the various doctors they consulted

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maintained that the Chart was accurate, and were unable to come to a consensus

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regarding what caused Mr. Wells’ condition. Ultimately, on November 23, 2011,

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Plaintiffs learned through a deposition of an expert that a scholarly article had been

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published in 2011 which alleged that Defendants had used false and misleading

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information to construct the Chart.

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Plaintiffs filed this instant action on November 12, 2013, in Sacramento County

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Superior Court, alleging nine causes of action based upon Defendants’ alleged

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fraudulent conduct: intentional misrepresentation; intentional concealment; actual fraud;

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negligent misrepresentation; negligence; intentional infliction of emotion distress;

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negligent infliction of emotional distress; unfair business practices; and wrongful death.

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Defendants removed the action to this Court on March 5, 2014. ECF No. 1.

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On March 12, 2014, Defendants moved to dismiss Plaintiffs’ claims pursuant to

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Rule 12(b)(6) for failure to state a claim upon which relief can be granted. ECF No. 8.

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Defendants asserted that Plaintiffs’ claims were not filed within the time required by their

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respective statutes of limitations, that Plaintiffs failed to plead with sufficient particularity

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as required by Rule 9(b), and that the Complaint did not state a plausible claim for relief.

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Id. The Court issued a Memorandum and Order on May 22, 2014, granting Defendants’

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motion based on violations of the various statutes of limitations. ECF No. 17. More

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specifically, the Court found that Plaintiffs’ allegations regarding application of the
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“discovery rule” were too conclusory. Id. However, the Court also held Defendants were

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not entitled to dismissal under Rule 9(b) or Rule 8, because Plaintiffs sufficiently pleaded

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their fraud claims. Id.

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On June 11, 2014, Plaintiffs filed their FAC alleging the same nine causes of

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action. ECF No. 18. On June 25, 2014, Defendants again moved to dismiss Plaintiffs’

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claims again pursuant to Rule 12(b)(6) and Rule 9(b). ECF No. 20. That motion is

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presently before the Court for adjudication. Defendants assert most prominently that

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Plaintiffs have not pleaded additional facts sufficient to warrant application of the

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“discovery rule.” Id. at 2.

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STANDARD

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On a motion to dismiss for failure to state a claim under Federal Rule of Civil

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Procedure 12(b)(6), all allegations of material fact must be accepted as true and

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construed in the light most favorable to the nonmoving party. Cahill v. Liberty Mut. Ins.

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Co., 80 F.3d 336,337-38 (9th Cir. 1996). Rule 8(a)(2) requires only “a short and plain

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statement of the claim showing that the pleader is entitled to relief” in order to “give the

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defendant fair notice of what the . . . claim is and the grounds upon which it rests.” Bell

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Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41,

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47 (1957)). A complaint attacked by a Rule 12(b)(6) motion to dismiss does not require

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detailed factual allegations. However, “a plaintiff’s obligation to provide the grounds of

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his entitlement to relief requires more than labels and conclusions, and a formulaic

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recitation of the elements of a cause of action will not do.” Id. (internal citations and

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quotations omitted). A court is not required to accept as true a “legal conclusion

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couched as a factual allegation.” Ashcroft v. Iqbal, 129 S. Ct. 1937, 1950 (2009)

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(quoting Twombly, 550 U.S. at 555). “Factual allegations must be enough to raise a

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right to relief above the speculative level.” Twombly, 550 U.S. at 555 (citing 5 Charles

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Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1216 (3d ed. 2004)
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(stating that the pleading must contain something more than “a statement of facts that

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merely creates a suspicion [of] a legally cognizable right of action.”)).

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Furthermore, “Rule 8(a)(2) . . . requires a showing, rather than a blanket

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assertion, of entitlement to relief.” Twombly, 550 U.S. at 556 n.3 (internal citations and

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quotations omitted). Thus, “[w]ithout some factual allegation in the complaint, it is hard

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to see how a claimant could satisfy the requirements of providing not only ‘fair notice’ of

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the nature of the claim, but also ‘grounds’ on which the claim rests.” Id. (citing 5 Charles

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Alan Wright & Arthur R. Miller, supra, at § 1202). A pleading must contain “only enough

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facts to state a claim to relief that is plausible on its face.” Id. at 570. If the “plaintiffs . . .

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have not nudged their claims across the line from conceivable to plausible, their

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complaint must be dismissed.” Id. However, “[a] well-pleaded complaint may proceed

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even if it strikes a savvy judge that actual proof of those facts is improbable, and ‘that a

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recovery is very remote and unlikely.’” Id. at 556 (quoting Scheuer v. Rhodes, 416 U.S.

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232, 236 (1974)).

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A court granting a motion to dismiss a complaint must then decide whether to

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grant leave to amend. Leave to amend should be “freely given” where there is no

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“undue delay, bad faith or dilatory motive on the part of the movant, . . . undue prejudice

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to the opposing party by virtue of allowance of the amendment, [or] futility of the

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amendment . . . .” Foman v. Davis, 371 U.S. 178, 182 (1962); Eminence Capital, LLC v.

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Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003) (listing the Foman factors as those to

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be considered when deciding whether to grant leave to amend). Not all of these factors

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merit equal weight. Rather, “the consideration of prejudice to the opposing party . . .

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carries the greatest weight.” Id. (citing DCD Programs, Ltd. v. Leighton, 833 F.2d 183,

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185 (9th Cir. 1987)). Dismissal without leave to amend is proper only if it is clear that

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“the complaint could not be saved by any amendment.” Intri-Plex Techs. v. Crest Group,

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Inc., 499 F.3d 1048, 1056 (9th Cir. 2007) (citing In re Daou Sys., Inc., 411 F.3d 1006,

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1013 (9th Cir. 2005); Ascon Props., Inc. v. Mobil Oil Co., 866 F.2d 1149, 1160 (9th Cir.

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1989) (“Leave need not be granted where the amendment of the complaint . . .

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constitutes an exercise in futility . . . .”)).

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ANALYSIS

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A.

Rule 9(b)

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Defendants have moved to dismiss pursuant to Rule 12(b)(6) and Rule 9(b), on

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grounds that the various statutes of limitations bar Plaintiffs’ claims and additionally that

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Plaintiffs have failed to plead with the particularity required by Rule 9(b). With respect to

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the Rule 9(b) grounds, in a footnote within Defendants’ Memorandum of Points and

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Authorities in Support of Motion to Dismiss, Defendants acknowledge that they are

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re-alleging the same grounds for dismissal under Rule 9(b) that were rejected by the

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Court in its previous Order. ECF No. 21 at 3, n.1. Consequently, given the prior Order,

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and the fact that the FAC alleges no new causes of action, Defendants are not entitled to

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dismissal under Rule 9(b) for the same reasons set forth in the previous Order. See

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ECF No. 17 at 5-7.

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B.

Rule 12(b)(6) – Statutes of Limitations

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The discovery rule is an exception to the general rule in California for defining the

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accrual of a cause of action. Norgart v. Upjohn Co., 21 Cal. 4th 383, 397 (1999). The

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discovery rule “postpones accrual of a cause of action until the plaintiff discovers, or has

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reason to discover the cause of action.” Id. In order to rely on the discovery rule, a

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plaintiff must “plead that, despite diligent investigation of the circumstances of the injury,

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he or she could not have reasonably discovered facts supporting the cause of action

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within the applicable statute of limitations period.” Fox v. Ethicon Endo-Surgery, Inc.,

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35 Cal. 4th 797, 809 (2005).

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The Court acknowledged in its previous Order that absent application of the

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discovery rule, Plaintiffs’ claims would be barred by the various statutes of limitations.

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See ECF No. 17 at 7. Plaintiffs’ claims for negligence, intentional and negligent infliction
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of emotional distress, and wrongful death must be brought within the two-year period

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required by Cal. Code Civ. Proc. § 335.1. The fraud claims are governed by a three-

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year limitations period under Cal. Code Civ. Proc. § 338(d). Finally, a claim for unfair

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business practices in violation of Cal. Bus. & Prof. Code § 17200 et seq. is governed by

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a four-year limitations period. Cal. Code Civ. Proc. § 17208. Plaintiffs filed the instant

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action on November 12, 2013, over four years after Mr. Wells’ death. Thus, in order for

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Plaintiffs’ claims to move forward, the discovery rule must apply.

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In assessing the viability of Plaintiffs’ original Complaint, the Court found that
Plaintiffs’ allegations regarding delayed discovery were too conclusory to warrant

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application of the discovery rule. This was because Plaintiffs had failed to allege enough

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facts attesting to their inability to discover Defendants’ alleged misconduct earlier. Id. In

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their FAC, however, Plaintiffs allege additional facts in support of application of the

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discovery rule. See ECF No. 18 at 5-6. Defendants assert those allegations are still

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insufficient to rectify the deficiencies identified by the Court in its previous Order. See

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ECF No. 21 at 8.

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In Fox v. Ethicon Endo-Surgery, Inc., the California Supreme Court analyzed

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whether a plaintiff in a products liability action had alleged enough facts in her complaint

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to support application of the discovery rule. 35 Cal. 4th at 803. Fox dealt with a plaintiff

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who initially brought a medical malpractice action against her surgeon, but based on

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information learned during the surgeon’s deposition, later instituted a products liability

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cause of action against a medical device manufacturer. Id. The California Supreme

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Court ultimately found that the plaintiff’s pleading was sufficient to warrant potential

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application of the discovery rule. Id. The Fox court noted that the standard required to

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support application of the discovery rule when ruling on the pleadings is different than

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when ruling on a motion for summary judgment. Id. at 810. Fox reasoned that it was

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enough for the plaintiff to allege her inability to discover the product as a potential cause

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of injury based on the fact that no reasonable person in her position could have

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discovered that as a cause before the surgeon’s deposition. Id. at 811.
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Like the plaintiff in Fox, Plaintiffs have alleged additional facts in their FAC that

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satisfy the requirements for alleging application of the discovery rule at this early stage.

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Plaintiffs point out that up until the expert’s deposition on November 23, 2011, none of

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the doctors they consulted mentioned the Chart, nor the fact that it was based on false

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information. See ECF No. 18 at 5-6. Through their investigation of the cause of

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Mr. Wells’ illness following his initial valve replacement, Plaintiffs consulted multiple

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doctors who, while presented differing opinions about the cause of his resulting

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complications, all agreed the Valve product itself was functioning properly. Id. Even the

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doctor who ultimately determined that a bigger valve size was needed and

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recommended a second surgery did not mention the chart as an issue. Id. If the various

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physicians who supervised Plaintiff’s care after the initial surgery did not implicate the

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Chart as containing false and/or misleading sizing information, it would be unreasonable

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to hold Plaintiffs themselves to a higher standard. Even the scholarly article relied on by

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the expert in the November 23, 2011 deposition was not published until 2011, two years

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after Mr. Wells’ death. To expect Plaintiffs to be more diligent in their investigation than

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experts in the field is unwarranted. Thus, Plaintiffs have met their burden for pleading

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application of the discovery rule at this stage in the case.

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Because Plaintiffs’ claims did not accrue until November 23, 2011, the date of the

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expert deposition, and since Plaintiffs brought the instant action on November 12, 2013,

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less than two years later, the claims have been brought within their respective statutory

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periods. Thus, Plaintiffs’ claims are not barred by the various statutes of limitations.

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CONCLUSION

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As set forth above, Defendants’ Motion to Dismiss Plaintiffs’ First Amended
Complaint (ECF No. 20) is DENIED.

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IT IS SO ORDERED.

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Dated: September 29, 2014

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