Saturday, July 21, 2018

Excerpted from: Response of Defendants-Appellees Aetna, Fleetboston, and New York Life to Supplemental Brief of Plaintiffs-Appellants Timothy and Chester Hurdle

Deadria Farmer-Paellmann et al., Plaintiffs - Appellants, v. Brown & Williamson Tobacco Corp. et al., Defendants-Appellees;
Timothy Hurdle et al.,  Plaintiffs-Appellants, v. R.J. Reynolds Tobacco Company et al., Defendants-Appellees. (
United States Court of Appeals, Seventh Circuit.) (October 20, 2006) Appeal from the United States District Court For the Northern District of Illinois, Lead Case No. 02 C 7764 The Honorable Charles R. Norgle, Sr.

 Table of Authorities (excluded) (Footnotes excluded)

 

Defendants-Appellees Aetna Inc., FleetBoston Financial Corporation n/k/a Bank of America Corporation, and New York Life Insurance Company respond as follows to the Supplemental Brief filed on behalf of the Hurdle Plaintiffs. As the Hurdle Plaintiffs state, the California Supreme Court's decision in Californians for Disability Rights v. Mervyn's, LLC, 39 Cal.4th 223, 138 P.3d 207, 46 Cal.Rptr.3d 57 (July 24, 2006), holds that, under the California Unfair Competition Law (Bus. & Prof. Code § 17200 et seq.), as amended by popular referendum, a plaintiff must plead and prove that he “has suffered injury in fact and has lost money or property as a result of such unfair competition.” Mervyn's holds that the injury-in-fact requirement of § 17200 applies to all pending litigation, such as the Hurdle case. See id. The Mervyn's decision was issued prior to the filing of the Hurdle Plaintiffs' Reply Brief in this appeal, but was not mentioned therein.

When the District Court issued its initial ruling in January 2004, it expressly held that all plaintiffs would be required to plead an injury for purposes of satisfying federal standing requirements, even if the state statute dispensed with such a requirement (Hurdle App. 31). In the face of that ruling, the Hurdle Plaintiffs chose not to amend their Complaint. The lower Court's July 2005 opinion and order dismissing the other plaintiffs' Second Consolidated and Amended Complaint specifically dismissed claims under § 17200 (e.g., pp. 32, 48, 82), and the Court entered an order terminating the Hurdle case (Hurdle App. 76).

The Mervyn's decision simply means that the Hurdle Plaintiffs are subject to the very standing requirement imposed by the District Court in its 2004 and 2005 opinions. The Hurdle Plaintiffs, however, now suggest that they be given another opportunity to amend. Yet the Hurdle Plaintiffs chose to rest on a plainly insufficient pleading when the District Court directed all plaintiffs to plead injury. Their inaction in the face of the District Court's explicit direction establishes that they, like the other plaintiffs, have no basis for such pleading and, even now before this Court, they offer nothing to suggest what such an amendment would say or what facts would support the necessary pleading of injury. The Hurdle Plaintiffs' conclusory reference to supposed “mass tort theories” offers no basis to connect any defendant with any actual loss suffered by any of the Hurdle Plaintiffs. The Hurdle Plaintiffs thus fail to address the fundamental standing problem identified by the District Court and now highlighted under California law.

Plaintiffs' Supplemental Brief also suggests that the case should be remanded so that California courts can determine whether to grant leave to amend. But it plainly was within Judge Norgle's discretion to dismiss, instead of remanding, where these Hurdle Plaintiffs did not amend, had not requested leave to amend, and had made no showing that they could cure the deficiencies of their pleading. Even if Judge Norgle had remanded to the transferor court (the Northern District of California), that court would have been compelled to dismiss the action, including for lack of standing under California law, rather than engage in the futile act of remanding to the state court. See Bell v. City of Kellogg, 922 F.2d 1418, 1424-25 (9th Cir. 1991) (federal court can dismiss where remand would be futile); Barberio v. City of Burien, 2006 U.S. Dist. LEXIS 53767 (D. Wash. 2006) (applying Ninth Circuit's futility rule); Pac. Sound Res. v. Burlington N. & Santa Fe Ry. Co., 2006 U.S. Dist. LEXIS 32792, 3-5 (D. Wash. 2006) (same).

The Hurdle Plaintiffs declined to amend when offered the opportunity by the District Court, and have never articulated any facts which, if properly pled, would create standing (or any cognizable claim) in any court - state or federal. This belated plea for another chance to amend should be denied..

 

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