Source: http://or.findacase.com/research/wfrmDocViewer.aspx/xq/fac.20190523_0000889.DOR.htm/qx
Timestamp: 2019-09-20 05:55:11
Document Index: 252874322

Matched Legal Cases: ['§ 1334', '§ 1334', '§ 1452', '§ 1334', '§ 1334', '§ 1452', '§1452', '§ 1452', '§ 1452', '§1452']

FindACase™ | Levin v. Johnson & Johnson
Levin v. Johnson & Johnson
MARY SHARON LEVIN, Plaintiff,
JOHNSON & JOHNSON and JOHNSON & JOHNSON CONSUMER COMPANIES LLC, a subsidiary of JOHNSON & JOHNSON; Defendants.
YOU, MAGISTRATE JUDGE:
On January 14, 2019, plaintiff Mary Sharon Levin filed suit in Multnomah County Circuit Court against manufacturers and distributors of asbestos-containing talc and talcum powder products to which she was exposed through personal use and during her fifty-year nursing career. Plaintiff alleges that as a result of that exposure, she developed mesothelioma, and seeks damages pursuant to state law for strict liability (First Claim) and negligence (Second Claim). ECF #1-1.
Defendants Johnson & Johnson and Johnson & Johnson Consumer Inc. (collectively, “J&J”) removed the claims against them to this court, citing Rule 9027 of the Federal Rules of Bankruptcy Procedure and 28 U.S.C. §§ 1334 and 1452. Notice 2, ECF #1.[1] The same day, J&J filed a motion to fix venue in the United States District Court for the District of Delaware, where its exclusive supplier of cosmetic talc, Imerys Talk America, Inc. and two affiliates Imerys Talc Vermont, Inc. and Imerys Talc Canada, Inc. (collectively, the “Debtors”), has filed a chapter 11 petition. ECF #1-3.[2] Although the Debtors were not named in the state court action filed by plaintiff in this case, J&J removed on the ground that plaintiff “may have claims against the Debtor's estates, ” and therefore her claims are “related to cases under title 11.” Notice ¶¶ 4, 17, ECF #1. Alleging that these claims “could conceivably have an effect on the estate being administered in bankruptcy, ” J&J avers that this court has “related-to” jurisdiction over Levin's claims pursuant to 28 U.S.C. § 1334(b). Id. ¶¶ 16-18 (emphasis in original).
Citing her declining health, plaintiff has filed an emergency motion to remand.[3] Mot. Remand 7, ECF #6. Even if this court may have jurisdiction over this action, equitable grounds support remand and plaintiff's motion to remand therefore should be GRANTED.
Federal courts are of limited jurisdiction, having subject matter jurisdiction only over matters authorized by the Constitution and Congress. See, e.g., Kokkonen v. Guardian Life Ins. Co., 511 U.S. 375, 377 (1994). A “strong presumption” against removal jurisdiction exists. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). 28 U.S.C. § 1452(a) allows a party to “remove any claim or cause of action in a civil action to the district court for the district where such action is pending” if the district court has jurisdiction of the claim or cause of action under 28 U.S.C. § 1334. Section 1334(b) vests district courts with “original but not exclusive jurisdiction of all civil proceedings arising under title 11 or arising in or related to cases under title 11.” 28 U.S.C. § 1334(b). Under the Pacor test, adopted by the Ninth Circuit, federal courts have “related to” jurisdiction over any proceeding where “the outcome could conceivably have any effect on the estate being administered in bankruptcy.” In re Pegasus Gold Corp., 394 F.3d 1189, 1193 (9th Cir. 2005) (citing Pacor, Inc. v. Higgins, 743 F.2d 984, 994 (3rd Cir. 1984)).
Under 28 U.S.C. § 1452(b), the district court may remand a claim or cause of action removed to federal court arising under Title 11, or arising in or related to a Title 11 case, “on any equitable ground.” McDowell Welding & Pipefitting, Inc. v. U.S. Gypsum Co., 285 B.R. 460, 475 (D. Or. 2002). Section 1452(b) has been understood to permit remand based on general fairness and reasonableness considerations. Things Remembered, Inc. v. Petrarca, 516 U.S. 124, 133 (1995) (defining “equitable” in §1452(b) to mean appropriate, and not an effort to distinguish between law and equity); see also Christie v. Chong, No. C-02-0472 EDL, 2002 WL 598428, at *4 (N.D. Cal. Apr. 10, 2002) (noting that § 1452(b)'s reference to “equitable ground” means one that is fair and reasonable).[4]
The Ninth Circuit applies a fourteen factor test, the “Cedar Funding factors, ” for determining whether equitable grounds support remand: (1) the effect on the efficient administration of the estate; (2) the extent to which state-law issues predominate; (3) the lack of novelty or difficulty of applicable law; (4) the presence of related state-court proceedings; (5) the lack of jurisdictional bases for removal other than section 1334(b); (6) the remoteness to the main bankruptcy case; (7) the absence of any core proceeding; (8) the inapplicability of severing claims; (9) the burden on the federal docket; (10) the likelihood of forum shopping; (11) the right to a jury trial; (12) the presence of non-debtor parties; (13) comity; and (14) the possible prejudice to the plaintiff. In re Cedar Funding, Inc., 419 B.R. 807, 820 (9th Cir. B.A.P. 2009); see also Machine Zone, Inc. v. Peak Web, LLC, No. 3:16-cv-01832-SI, 2017 WL 517796, at *5 (D. Or. Feb. 7, 2017); Slinde & Nelson, LLC v. Luneke, No. 3:16-cv-1914-HZ, 2017 WL 721242, at *2 (D. Or. Feb. 22, 2017); Cox v. Holcomb Family Ltd. Partnership, Adv. No. 14- 3260, 2015 WL 128001, at *1 (Bankr. D. Or. Jan. 8, 2015).[5] Courts also have considered judicial economy, the effect of bifurcating the claims and parties, and the possibility of inconsistent results. Cox, 2015 WL 128001, at *1 (citing In re Sequoia Village, LLC, Bankr. No. 11-64880-fra11, 2012 WL 478926 at *1 (Bankr. D. Or. Feb. 14, 2012)); see also Western Helicopters, Inc. v. Hiller Aviation, Inc., 97 B.R. 1, 2 (E.D. Cal. 1988) (finding equitable remand appropriate after considering the effect of bifurcating the claims and parties to an action and the possibilities of inconsistent results). Given that 28 U.S.C. § 1452(b) provides broad authority to remand “on any equitable ground, ” any one of the factors discussed above may be sufficient to support remand. Machine Zone, 2017 WL 517796, at *3; see also Slinde & Nelson, 2017 WL 721242, at *5; Stichting Pensioenfonds ABP v. Countrywide Fin. Corp., 447 B.R. 302, 211 (C.D. Cal. 2010).
Courts in this circuit and elsewhere have remanded claims arising from exposure to the talc used in Johnson & Johnson products on the basis of equity. See, e.g., Lewis, et al. v. Johnson & Johnson, et al., No. 1:19-mp-56001-RLM (Bankr. S.D. Ind. May 20, 2019); Aitchison, et al. v. Johnson & Johnson, et al., No. CV 19-0752-FMO (GJSx) (C.D. Cal. May 2, 2019); Haggerty v. Johnson & Johnson, et al., No. CV 19-3497-JFW (FFMx) (C.D. Cal. May 2, 2019). In two orders dated May 21, 2019, the Central District of California remanded a total of 150 such cases on equity grounds. In re: Removed State Court Talc Actions Against Johnson & Johnson, et al., No. 2:19-cv-03150-CJC-JC (C.D. Cal. May 21, 2019); In re: Removed State Court Talc Actions Against Johnson & Johnson, et al., No. 2:19-cv-03129-CJC-JC (C.D. Cal. May 21, 2019).[6] Likewise, in this action, regardless of whether the claims against J&J qualify as “related to” the bankruptcy, the relevant factors for consideration under section 1452(b) support an equitable remand. In re Schwartz, No. 5:09-cv-05831 EJD, 2012 WL 899331, at *2 (N.D. Cal. Mar. 15, 2012) (“whether the state court actions qualify as actions ‘related to' the bankruptcy case is no longer the operative question because the relevant factors for consideration under §1452(b) each support an equitable remand”).
This action will have limited effect on the administration of bankruptcy proceedings. It is remote from any bankruptcy proceeding-the debtor is not a party-and this action does not present any bankruptcy issues. See Bally Total Fitness v. Contra Costa Retail Ctr., 384 B.R. 566, 573 (N.D. Cal. Feb. 20, 2008); see also Slinde & Nelson, 2017 WL 721242, at *4 (remanding where named defendants were non-debtor parties); Parke v. Cardsystems Sol., Inc., No. C 06-04857 WHA, 2006 WL 2917604, at *5 (N.D. Cal. Oct. 11, 2006) (considering that there are non-bankruptcy related issues between non-debtors in deciding to remand); In re Enron, 296 B.R. 505, 509 (C.D. Cal. 2003) (favoring equitable remand where none of the parties were debtors).
Relatedly, the removed state law claims against J&J are non-core. As defined by the Ninth Circuit, “if the proceeding does not invoke a substantive right created by the federal bankruptcy law and is one that could exist outside of bankruptcy[, ] it is not a core proceeding. . . .” In re ACI-HDT Supply Co., 205 B.R. 231, 237 (9th Cir. B.A.P. 1997) (quoting In re Eastport Assoc., 935 F.2d 1071, 1076 (9th Cir. 1991)); see also In re People's Choice Home Loan, No. 8:07-10765-RK, 2007 WL 9637067, at *4 (Bankr. C.D. Cal., Oct. 31, 2007) (finding the removed state court action was non-core because it was based on California common and statutory law and not dependent on bankruptcy law). Because the claims do not qualify as a core proceeding, “federal court is not a more appropriate forum than state court for resolution of the dispute.” Estate of Scott v. Cervantes, No. CV 08-03293 MMM (CWx), 2008 WL 11337657, at *5 (C.D. Cal. July 29, 2008); see also Slinde & Nelson, 2017 WL 721242, at *4 (favoring remand where alleged claims are not intertwined with “core” bankruptcy matters).
Moreover, judicial economy weighs in favor of remanding non-core proceedings. J&J's removal was based on a desire to “centralize the adjudication of claims” by ultimately transferring the claims against it to the federal bankruptcy court in the District of Delaware. Notice 4, ECF #1. However, “[s]ince the action is not a core proceeding, the bankruptcy judge will be required to submit proposed findings of fact and conclusions of law to a district court for de novo review . . . . In other words, the case ultimately would have to be determined outside of the bankruptcy court, and thus judicial economy favors remand.” Estate of Scott, 2008 WL 11337657, at *5.
Plaintiff's request for a jury trial also undermines any judicial efficiency to be achieved by removal. The fact that a plaintiff seeks a jury trial-which will prevent the bankruptcy court from hearing the case-demonstrates that no judicial efficiency will be achieved by removal, and that equity supports a remand. Id. at *6; City of Moreno Valley, No. EDCV02-1387-VAP (SGLX), 2003 WL 22126450, at *3 (C.D. Cal. Mar. 21, 2003) (noting that remand was appropriate in part because “this is a case where the parties are entitled to a jury trial”). Indeed, “[c]ourts have granted equitable remand solely on the basis of a party's entitlement to a jury trial when that party's action was not a ‘core proceeding.'” Fed. Home Loan Bank of Seattle v. Barclays Capital, Inc., No. C10-0139 RSM, 2010 WL 3662345, at *7 (W.D. Wash. Sept. 1, 2010).
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Further, it is compelling that issues of state law predominate. Courts consistently have exercised their discretion to remand under section 1452(b) where a case is grounded exclusively in state law. SeeParke, 2006 WL 2917604 at *4 (finding that remand was appropriate where &ldquo;[a]ll seven of plaintiff&#39;s claims were brought under California common or statutory law&rdquo;); In re Bay Area Material Handling, Inc., No. C 95-01903 CW, 1995 WL 747954, *9 (N.D. Cal. Dec. 6, 1995) (&ldquo;the predominance of state law issues supports remand, given that a state court is &lsquo;better able to hear and determine a suit involving questions of state law than is a bankruptcy court&#39;&rdquo;) (quoting Western Helicopters, 97 B.R. at 6). Here, there are no &ldquo;difficult or unsettled issues of federal law&rdquo; presented by the two state law claims alleged. MBIA Ins. Corp. v. Indymac ABS, Inc., No. CV 09-07737 SJO (PJWx), 2009 WL 10675774, at *2 (C.D. ...