Supreme Court Holds That Third-Party Counterclaim Defendants May Not Remove An Action Based On The General Removal Statute Or CAFA
On May 28, 2019, the Supreme Court held in a 5-4 decision authored by Justice Thomas that a third-party counterclaim defendant was not permitted to remove class action claims against it under the general removal statute, 28 U.S.C. § 1441 (“Section 1441”), or the Class Action Fairness Act, 28 U.S.C. § 1453 (“CAFA”). Home Depot U. S. A., Inc. v. Jackson, No. 17-1471, 587 U.S. ___ (2019). The Court held that the term “defendant” in the two removal provisions at issue applies only to “the party sued by the original plaintiff” and should not be expanded to include third-party counterclaim defendants. As noted in our prior post when the case was argued before the Supreme Court, this decision is the first time the Supreme Court has discussed the scope of Shamrock Oil & Gas Corp. v. Sheets, 313 U.S. 100 (1941), which addressed analogous language in Section 1441’s predecessor and held that a plaintiff who originally filed an action in state court would not be permitted to later remove it to federal court as a “defendant” once counterclaims were filed against it.
Second Circuit Affirms District Court’s Denial Of Motions To Remand, Finding That Removal Prior To Service Of The Complaints Was Proper Under The “Forum Defendant Rule”
On March 26, 2019, the United States Court of Appeals for the Second Circuit affirmed the removal and dismissal of claims brought against two pharmaceutical companies. Gibbons v. Bristol-Myers Squibb Company and Pfizer Inc., No. 17-2638 (2d. Cir. Mar. 26, 2019). Plaintiffs asserted over a dozen claims across multidistrict litigation (“MDL”) against defendants alleging that plaintiffs or their decedents suffered injuries as a result of the allegedly improper design of and insufficient warning labels for a certain blood-thinning drug used to reduce the risk of stroke in patients with atrial fibrillation that was manufactured and distributed by defendants.