United States District Court, D. Delaware
STATE OF DELAWARE, ex rel. MATTHEW P. DENN, Attorney General of the State of Delaware, Plaintiff,
PURDUE PHARMA L.P., PURDUE PHARMA INC., THE PURDUE FREDERICK COMPANY, ENDO HEALTH SOLUTIONS INC., ENDO PHARMACEUTICALS INC., MCKESSON CORPORATION, CARDINAL HEALTH, INC., AMERISOURCEBERGEN CORPORATION, ANDA PHARAMACEUTICALS, INC., H.D. SMITH, LLC, CVS HEALTH CORPORATION, and WALGREENS BOOTS ALLIANCE, INC., Defendants.
State of Delaware, originally filed this suit in the Superior
Court of the State of Delaware against manufacturers,
distributors, and pharmacy retailers of prescription opioids,
alleging state common law claims for their roles in
Delaware's opioid crisis. (D.I. 8 at 1-2). Plaintiff
asserted five claims against Defendant McKesson Corporation
complaining of over-distribution of prescription opioids into
Delaware, including Consumer Fraud ("Count V"),
Public Nuisance ("Count VI"), Negligence
("Count VII"), Unjust Enrichment ("Count
VIII"), and Civil Conspiracy ("Count DC").
(D.I. 1 at 2). McKesson filed a notice of removal to this
Court, asserting this Court has federal question
jurisdiction. (Id. at 4). McKesson asserts
Plaintiffs claims "aris[e] solely [from duties] under
the [F]ederal Controlled Substances Act"
("FCSA"). (D.I. 25 at 1).
before the Court is Plaintiffs Motion to Remand for lack of
federal subject matter jurisdiction. (D.I. 4). The issues
have been fully briefed. (D.I. 8, 25, 27). For the reasons
set forth below, Plaintiffs Motion is GRANTED, and this
action will be remanded to Superior Court.
filed this action against Defendants in Superior Court of the
State of Delaware on January 19, 2018. (D.I. 1-1 at p.
10). Plaintiff alleges that Defendants created and fueled
Delaware's opioid crisis by, among other things,
violating both the Delaware Controlled Substances Act and the
Federal Controlled Substances Act. Plaintiff alleges McKesson
diverted prescription opioids to an illegitimate channel,
filled suspicious orders of opioids, and allowed opioids to
be lost or stolen from inventory. (Id. at 19).
Plaintiff alleges only state law claims based on theories of
consumer fraud, nuisance, negligence, unjust enrichment, and
civil conspiracy against McKesson. (Id. at 114-27).
Nonetheless, on March 9, 2018, McKesson filed a notice of
removal and asserted this Court has federal question
jurisdiction pursuant to the FCSA. (D.I. 1 at 4). Plaintiff
filed amotion for remand on March 13, 2018. (D.I. 4).
1441(a) permits the removal of "any civil action brought
in a State court of which the district courts of the United
States have original jurisdiction." 28 U.S.C. §
1441(a). "Only state-court actions that originally could
have been filed in federal court may be removed to federal
court by the defendant." Kline v. Security Guards,
Inc., 386 F.3d 246, 251 (3d Cir. 2004) (quoting
Caterpillar Inc. v. Williams, 482 U.S. 386, 392
(1987)). If the case could not have been filed in federal
court, then removal under §1441 is improper and remand
is appropriate. Id. Removal jurisdiction should be
strictly construed against removal, and "all doubts
[should] be resolved in favor of remand." Brown v.
Jevic, 575 F.3d 322, 326 (3d Cir. 2009). The party
seeking removal bears the burden of demonstrating that
removal is proper. Id.
remove this case to federal district court, McKesson must
establish that this Court has "original
jurisdiction" due to the action "arising
under" federal law. 28 U.S.C. § 1331. Federal question
jurisdiction is governed by the well-pleaded complaint rule,
which "provides that federal jurisdiction exists only
when a federal question is presented on the face of the
plaintiffs properly pleaded complaint." Kline,
386 F.3d at 251. This Court has federal question jurisdiction
over all civil actions "arising under the Constitution,
laws, or treaties of the United States." 28 U.S.C.
"arising under" standard can implicate federal
jurisdiction when "federal law creates the cause of
action asserted." Gunn v. Minton, 568 U.S. 251,
256 (2013) (citing American Well Works Co. v. Layne &
Bowler Co., 241 U.S. 257, 260 (1916)). Alternatively,
some state law claims can implicate federal jurisdiction when
they "implicate significant federal issues."
Grable & Sons Metal Prods., Inc. v. Darue Eng'g
& Mfg., 545 U.S. 308, 312 (2005). These cases are
exemplary and constitute a "special and small
category" of federal question jurisdiction. Empire
Healthchoice Assurance, Inc. v. McVeigh, 547 U.S. 677,
699 (2006). To determine whether a state-law claim implicates
federal question jurisdiction, "the question is, does a
state-law claim necessarily raise a stated federal issue,
actually disputed and substantial, which a federal forum may
entertain without disturbing any congressionally approved
balance of federal and state judicial responsibilities."
Grable & Sons Metal Prods., 545 U.S. at 314.
But, "the mere presence of a federal issue in a state
cause of action does not automatically confer
federal-question jurisdiction." Merrell Dow Pharm.
Inc. v. Thompson, 478 U.S. 804, 813 (1986).
Motion to Remand is granted because McKesson fails to show
that Plaintiffs state law claims implicate federal
jurisdiction. Because there is no dispute that Plaintiffs
claims arise under state law, McKesson must show that a
federal issue is (1) necessarily raised, (2) actually
disputed, (3) substantial, and (4) capable of resolution
without disrupting the federal-state balance approved by
Congress. Grable & Sons Metal Prods., 545 U.S.
federal issue is "necessarily raised" when
"vindication of a right under state law must necessarily
turn on some construction of federal law." Manning
v. Merrill Lynch Pierce Fenner & Smith, Inc., 772
F.3d 158, 163 (3d Cir. 2014) (alterations omitted),
aff'd, 136 S.Ct. 1562 (2016); see Grable
& Sons Metal Prods., 545 U.S. at 310-12 (quiet title
claim alleging IRS failed to give adequate notice as defined
by federal law). An example of a state claim necessarily
raising a federal issue occurs when the determination of
federal law is an essential element of the plaintiffs state
law claim. See Smith v. Kansas City Title & Trust
Co., 255 U.S. 180 (1921) (state law claims to forbid the
defendant from investing in illegal securities where the
source of illegality was that the federal bonds were issued
case, McKesson asserts that Plaintiffs claims are
"affirmatively premised" on Defendants'
violations of the FCSA. (D.I. 25 at 11). Thus, argues
McKesson, federal issues are necessarily raised.
(Id.). Specifically, McKesson notes that the claims
are based on Defendants' failure to monitor for, report,
and halt suspicious orders for prescription opioids, which
are duties that arise under the FCSA. (Id.).
Although a determination of whether Defendants violated the
FCSA may occur while addressing Plaintiffs claims, there is
also the possibility that the claims will be resolved without
resolution of the federal issue at all. Based on the
complaint, it is possible for the state law claims to be
resolved solely under state law. See Manning, 772
F.3d at 163 ("We conclude it was improper for the
District Court to foreclose the possibility that particular
state causes of action could permit recovery solely under
state law."). Although the complaint addresses some
duties or requirements under the FCSA, the complaint also
lists several other duties and standards that arise solely
under state statutory or common law. (D.I. 1-1).
in Count V, Plaintiff asserts that Distributor and Pharmacy
Defendants "misrepresented material facts [or]
suppressed, concealed, or omitted material facts with the
intent that consumers will rely thereon." (D.I. 1-1 at
p. 114). McKesson asserts that the claim is based on federal
law because Count V states Defendants "have violated
Delaware and Federal laws and regulations by . .. habitually
filling suspicious or invalid orders for prescription opioids
... and failing to operate a system to disclose suspicious
orders of controlled substances." (D.I. 25 at 7; D.I.
1-1 at p. 115). Count V, however, makes reference to far more
than McKesson draws attention to. In Count V, Plaintiff
proffers one theory that makes reference to federal law, but
Plaintiff also asserts five other theories by which
Defendants misrepresented or concealed facts, each of which
is unrelated to federal law. Most importantly, Count V
asserts that Defendants' misrepresentations and concealed
facts constitute violations of § 2513(a) of the Delaware
Consumer Fraud Act. (D.I. 1-1 at p. 116). Although Plaintiff
asserts Defendants violated the Delaware Consumer Fraud Act
by misrepresenting their alleged violations of federal law,
Defendants may be found to have violated the Delaware
Consumer Fraud Act on any of the other five theories
Plaintiff asserted in the complaint. See Manning,
772 F.3d at 164 (noting no federal question is necessarily
raised where plaintiff could prevail on state claims without
the need to prove or establish a violation of federal law
despite alleging both federal and state violations). The
federal issue of whether Defendants misrepresented their