By: Nicholas Malfitano
Out-of-state plaintiffs flocked to Philadelphia this year to file lawsuits over prescription drugs, but a recent U.S. Supreme Court decision might deter that practice in the future.
Thousands of claimants who have brought their lawsuits in Philadelphia will have to see if pharmaceutical companies like Johnson & Johnson decide to use a June 19 U.S. Supreme Court ruling that found an out-of-state plaintiff couldn't file suit in California.
Supreme Court justices ruled 8-1 in favor of Bristol Myers-Squibb after the company argued plaintiffs living outside California who alleged injury from BMS’s blood thinner Plavix should not be able to sue the company in that state.
The Supreme Court delivered an opinion that, in effect, could spell the end of the all-inclusive view of personal jurisdiction. Plavix was not designed or made in California, and the company is headquartered in New York.
“Non-residents can sue in the Philadelphia County Court of Common Pleas if the defendant is either incorporated in Pennsylvania (not very likely) or has a principal place of business in Pennsylvania (more likely),” said James Beck, Senior Life Sciences Policy Analyst for Reed Smith in Philadelphia.
Two of the biggest mass tort programs in the Philadelphia Complex Litigation Center process lawsuits filed over Risperdal, which is produced by Janssen Pharmaceuticals (a Johnson & Johnson subsidiary) and allegedly causes boys to develop breasts, and Xarelto, a blood-thinner made by Bayer and Johnson & Johnson that allegedly causes bleeding events.
Bayer might have a harder time using the BMS decision, given a headquarters in Pittsburgh.
“The mere fact that other plaintiffs were prescribed, obtained, and ingested Plavix in California — and allegedly sustained the same injuries as did the non-residents — does not allow the State to assert specific jurisdiction over the nonresidents’ claims,” wrote Justice Samuel Alito.
Justice Sonia Sotomayor alone dissented from the majority opinion of the Court, saying the ruling could “curtail — and in some cases eliminate — plaintiffs’ ability to hold corporations fully accountable for their nationwide conduct.”
Beck explained in a recent blog that the ruling could have a transformative effect on product liability suits nationwide.
“This is one of the most important mass tort/product liability decisions ever, because expansive notions of personal jurisdiction – that large companies can be sued by anyone anywhere – are behind the growth of “magnet jurisdictions”... that attract litigation tourist plaintiffs from all over the country, suing companies from all over the country, without regard for whether any such defendant is incorporated or does business in the state," Beck wrote.
"Get rid of any personal jurisdiction basis for doing so, and we, if not end, at least put major limits on plaintiffs’ ability to forum-shop in this manner."
Pennsylvania - specifically Philadelphia's Complex Litigation Center - is one of several jurisdictions that has some appeal to plaintiffs lawyers, judging by the numbers.
Almost 4,000 new lawsuits were filed from the beginning of 2017 to the end of May, the vast majority over prescription drugs. The Risperdal program, in particular, is seeing a huge increase over recent years.
In that same timeframe, 3,643 lawsuits have been filed over prescription drugs, with a whopping 94% of plaintiffs living outside of Pennsylvania.
The Risperdal program has produced a mixture of multimillion-dollar verdicts and defense victories, and an explosion of new cases in 2017 has left the CLC with more than 5,500 lawsuits pending.
Meanwhile, a federal judge in St. Louis, ruled this month to dismiss 53 lawsuits against Johnson & Johnson from out-of-state plaintiffs. U.S. District Court Judge Stephen Limbaugh pointed to the BMS decision in determining the plaintiffs in question did not have jurisdiction to bring their claims in the state of Missouri.
Janssen spokesperson, Kelsey Buckholtz, did not offer comment on whether it would use the same strategy in Philadelphia. J&J is based in New Jersey.
“We believe the District Court in the Eastern District of Missouri acted appropriately in dismissing these 53 lawsuits by non-Missouri plaintiffs based on the recent Supreme Court decision. The District Court decision was clear that neither the state court nor federal court has jurisdiction over nonresidents’ claims,” Buckholtz said.
“We sympathize with individuals suffering from serious mental conditions, which can have a significant negative impact on a person’s life and on the health and stability of families. It's important to point out that Risperdal (risperidone), when used as part of a comprehensive treatment plan, continues to help millions of patients with mental illnesses and neurodevelopmental conditions."
For Risperdal, a litigation explosion took place in the CLC in 2017.
As of Jan. 2, there were only 1,945 cases pending in the Philadelphia County Court of Common Pleas, whereas now there are 5,548. This accounts for 3,603 additional cases. This trend has previously been attributed to the cancelling of tolling agreements on many cases, leading to the huge litigation spike.
In contrast, Xarelto saw a far more modest increase since the beginning of the year.
As of Jan. 2, there were only 1,214 cases pending in the Philadelphia County Court of Common Pleas, whereas now there are 1,424 - an additional 210 cases.
Notably, there has been an overall 20 percentage point-increase to date in out-of-state plaintiffs in the CLC’s pharmaceutical filings. That figure stood at 74% in 2016, whereas it now clocks in at 94% so far in 2017 – taken from 3,643 out-of-state plaintiffs in a total of 3,884 cases.
Reglan litigation has the second-most pending lawsuits at the CLC, close to 2,100. Allegations over that digestive drug include side effects to the neurological system.