Dimensions Medical Center, Ltd. v. Alcon Laboratories Inc
Filing
238
MEMORANDUM Opinion and Order: Plaintiff's motion to reconsider or transfer is denied. 192 Signed by the Honorable Thomas M. Durkin on 11/6/2018:Mailed notice(srn, )
Case: 1:16-cv-04539 Document #: 238 Filed: 11/06/18 Page 1 of 8 PageID #:36176
UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
AMERICA’S HEALTH & RESOURCE CENTER
LTD., AND AFFILIATED HEALTH GROUP, LTD.
individually and as the representatives
of a class of similarly-situated persons,
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PLAINTIFFS,
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v.
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ALCON LABORATORIES, INC.,
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NOVARTIS PHARMACEUTICALS CORPORATION, )
AND JOHN DOES 1-12,
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)
)
DEFENDANTS.
No. 16 C 4539
Judge Thomas M. Durkin
MEMORANDUM OPINION AND ORDER
Plaintiffs America’s Health & Resource Center Ltd. and Affiliated Health
Group, Ltd. ask this Court to reconsider its June 15, 2018 order granting
Defendants’ motion to strike Plaintiffs’ class definition. In the alternative, Plaintiffs
ask the Court to transfer this proceeding to the District of Delaware. At the crux of
Plaintiffs’ arguments is the Supreme Court decision in China Agritech, Inc. v. Resh,
138 S. Ct. 1800 (2018). For the following reasons, Plaintiffs’ motion is denied.
DISCUSSION
I.
China Agritech
In American Pipe & Constr. Co. v. Utah, 414 U.S. 538 (1974), the Supreme
Court held that the timely filing of a class action tolls the applicable statute of
limitations for all persons encompassed by the class complaint. The Court also held
that where class-action status has been denied, members of the failed class could
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timely intervene as individual plaintiffs in the still-pending action. See id. at 544,
552-553. Later, in Crown, Cork & Seal Co. v. Parker, 462 U.S. 345 (1983), the Court
clarified American Pipe’s tolling rule to state that putative class members need not
intervene in or join an existing suit. Instead, the rule also applies to putative class
members who, after denial of class certification, “prefer to bring an individual suit
rather than intervene . . . once the economies of a class action [are] no longer
available.” Id. at 350. The circuit courts then split as to whether the American Pipe
tolling rule includes successive class action suits. China Agritech, 138 S. Ct. at 1805
(listing cases); Sawyer v. Atlas Heating & Sheet Metal Works, Inc., 642 F.3d 560,
563 (7th Cir. 2011) (holding American Pipe tolling could apply to successive class
action suits).
The Supreme Court in China Agritech resolved the circuit split, and held that
the American Pipe rule tolls only a putative class member’s individual claims—it
does not allow a putative class member to file a new class action after the statute of
limitations has expired. 138 S. Ct. at 1806-08. The Court explained that equitable
tolling is available for individual claims “because economy of litigation favors
delaying those claims until after a class-certification denial.” Id. at 1806. But the
“efficiency and economy of litigation that support tolling of individual claims do not
support maintenance of untimely successive class actions; any additional class
filings should be made early on, soon after the commencement of the first action
seeking class certification,” so that all would-be early representatives come forward
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to allow the district court to select the best plaintiff. Id. at 1806-07. With that
background, the Court turns to Plaintiffs’ arguments.
II.
Motion to Reconsider
“Motions for reconsideration serve a limited function: to correct manifest
errors of law or fact or to present newly discovered evidence.” Caisse Nationale de
Credit Agricole v. CBI Indus., 90 F.3d 1264, 1269 (7th Cir. 1996). They are proper
where the court “has patently misunderstood a party, or has made a decision
outside the adversarial issues presented to the Court by the parties, or has made an
error not of reasoning but of apprehension.” Bank of Waunakee v. Rochester Cheese
Sales, Inc., 906 F.2d 1185, 1191 (7th Cir. 1990). Motions for reconsideration are not,
however, “appropriate vehicle[s] for relitigating arguments that the Court
previously rejected or for arguing issues that could have been raised during the
consideration of the motion presently under reconsideration.” Caine v. Burge, 897 F.
Supp. 2d 714, 717 (N.D. Ill. 2012) (citing Caisse, 90 F.3d at 1270).
In its June 15, 2018 order, the Court held it lacks specific jurisdiction over
Defendants with respect to class members not located in Illinois. R. 190. Because it
lacks jurisdiction, the Court struck any class allegations referring to those nonIllinois putative class members. In doing so, the Court relied on Supreme Court
precedent in Bristol-Myers Squibb Co. v. Superior Court of California, San
Francisco Cty., 137 S. Ct. 1773 (2017), and several opinions in this district that also
held that courts lack jurisdiction over out-of-state defendants with regard to
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nonresident class members in analogous cases. Id. at 2-4. Plaintiffs now argue the
Court erred in reaching that decision.
Preliminarily, Plaintiffs’ arguments on reconsideration regarding Federal
Rule of Civil Procedure 12(f) and Defendants’ waiver are duplicative of their prior
arguments and are inappropriate on reconsideration. See In re Abbott Depakote
S’holder Derivative Litig., 2013 WL 4953686, at *4 (N.D. Ill. Sept. 12, 2013) (“The
Court’s Order is not a brief that is subject to refutation and it is inappropriate for
the Defendants to file a motion for reconsideration merely because they disagree
with the Court.”).
The only argument Plaintiffs make that is appropriately the subject of a
reconsideration motion involves prejudice to the putative class based on China
Agritech. Plaintiffs argue this Court’s order “materially prejudices” non-Illinois
putative class members because “approximately half of the more than 650,000
claims at issue would be barred on statute of limitations grounds, under China
Agritech, because the faxes at issue were sent more than four years ago.” R. 192 at
8. But China Agritech has no effect on the suits of individual class members. Those
suits are still tolled under American Pipe. As a result, no putative class member has
lost her claim because of this Court’s order. Individuals allegedly affected by
Defendants’ conduct have lost only the ability to pursue their claims as a class
action, if their claim falls outside the statute of limitations period. That is exactly
what China Agritech intended. 138 S. Ct. at 1804 (“American Pipe tolls the statute
of limitations during the pendency of a putative class action, allowing unnamed
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class members to join the action individually or file individual claims if the class
fails. But American Pipe does not permit the maintenance of a follow-on class action
past expiration of the statute of limitations.”). 1
Plaintiffs also contend that absent class members are prejudiced because
“[t]he small potential recovery of $500 in statutory damages simply provides
insufficient incentive for TCPA victims to bring individual actions,” and the Court’s
order effectively ensures that none of the unnamed class members are likely to
bring an individual suit. R. 214 at 8. While that may be true on a practical level,
those “practical problems” do not override the “more abstract matter of submitting
[Defendants] to the coercive power of a State that may have little legitimate interest
in the claims in question.” Bristol-Myers, 137 S. Ct. at 1780. The Court simply
cannot avoid the clear precedent set by the Supreme Court in Bristol-Myers and
China Agritech to expand Plaintiffs’ putative class. Plaintiffs have a pending
putative class comprised of Illinois residents who received faxes in Illinois. If
Plaintiffs wish to expand that class, they must do so in a forum that can exercise
personal jurisdiction over Defendants with regard to all of Plaintiffs’ proposed class
members. And if Plaintiffs wish to encompass as many faxes as possible, they
should file suit in that forum, rather than continuing to seek reconsideration of this
Court’s application of clear Supreme Court precedent while the statute of
limitations continues to run.
Greene v. Mizuho Bank, Ltd., 289 F. Supp. 3d 870 (N.D. Ill. 2017), which Plaintiffs
cite in support of their argument that the Court should not follow Bristol-Myers if it
prejudices Plaintiffs, is inapposite. The court’s discussion regarding tolling of the
limitations period (id. at 877) is moot after China Agritech.
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For those reasons, the Court denies Plaintiffs’ motion to reconsider.
III.
Motion to Transfer
In the alternative, Plaintiffs request the Court transfer these proceedings to
the District of Delaware under 28 U.S.C. § 1631. Section 1631 provides:
Whenever a civil action is filed in a court . . . and that court finds that
there is a want of jurisdiction, the court shall, if it is in the interest of
justice, transfer such action or appeal to any other such court in which
the action or appeal could have been brought at the time it was filed or
noticed, and the action or appeal shall proceed as if it had been filed in
or noticed for the court to which it is transferred on the date upon
which it was actually filed in or noticed for the court from which it is
transferred.
28 U.S.C. § 1631. Section 1631 has been held to apply not only where subject matter
jurisdiction lies in the transferee court but not the transferor court, but also where
the defendant is subject to personal jurisdiction not in the transferor court but in
the transferee court. See Greene v. Mizuho Bank, Ltd., 169 F. Supp. 3d 855, 866-67
(N.D. Ill. 2016) (listing cases). 2
Defendants argue that the Court cannot transfer the case under Section 1631
because the Court has jurisdiction, and thus there is no “want of jurisdiction” as
required by the section. The Court agrees—it has jurisdiction over Plaintiffs’ claims
because Plaintiffs are Illinois residents and allegedly received their faxes in Illinois.
Accordingly, Section 1631 cannot apply. F.D.I.C. v. Kahlil Zoom-In Markets, Inc.,
But there is a circuit split as to whether courts may transfer cases under Section
1631 if the court has subject matter jurisdiction but lacks personal jurisdiction. See
Carpenter-Lenski v. Ramsey, 210 F.3d 374 (7th Cir. 2000) (listing cases but choosing
not to reach the issue).
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978 F.2d 183, 184 (5th Cir. 1992) (“By its very terms, [Section 1631] may be utilized
only for a transfer from a court that lacks jurisdiction.”).
That the Court lacks jurisdiction over the nonresident unnamed class
members is immaterial. A nonnamed class member is not a party to the class-action
litigation before the class is certified. See Standard Fire Ins. Co. v. Knowles, 133 S.
Ct. 1345, 1349 (2013). Plaintiffs rely on Devlin v. Scardelletti, 536 U.S. 1 (2002), to
argue that nonnamed class members can be considered parties when their rights
are affected like parties. Id. at 9-10 (absent class members “may be parties for some
purposes and not for others.”). But Devlin is inapplicable here, because the Court
made clear that its ruling applied only to those nonnamed members of a certified
class. Id. at 3 (explaining that the petitioner was a “nonnamed member of a class
certified under [Rule] 23(b)(1)”); see also id. at 16 n.1 (Scalia, J., dissenting) (“Not
even petitioner, however, is willing to advance the novel and surely erroneous
argument that a nonnamed class member is a party to the class-action
litigation before the class is certified.”) (emphasis in original). 3
Even if Devlin applied to not-yet-certified classes, the Court noted that nonnamed
class members are not parties for purposes of determining jurisdiction. Devlin, 536
U.S. at 10 (“The rule that nonnamed class members cannot defeat complete
diversity is likewise justified by the goals of class action litigation. Ease of
administration of class actions would be compromised by having to consider the
citizenship of all class members, many of whom may even be unknown, in
determining jurisdiction.”).
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Because Section 1631 does not apply, Plaintiffs’ motion for transfer is
denied. 4
Conclusion
For the foregoing reasons, the Court denies Plaintiffs’ motion to reconsider or
transfer, R. 192.
ENTERED:
______________________
Honorable Thomas M. Durkin
United States District Judge
Dated: November 6, 2018
Defendants also argue that transfer under 28 U.S.C. §§ 1404 or 1406(a) is not
proper. R. 206 at 10-13. Plaintiffs do not move for transfer under those sections and
do not address them in their reply.
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