Magistrate suggests sending class action to Minn. court

John O'Brien Oct. 19, 2011, 9:00am

Brian Glasser

MINNEAPOLIS (Legal Newsline) - A federal magistrate judge has suggested that a class action brought by a West Virginia law firm that drew the ire of the judge who formerly presided over the case should be heard in a state court.

Magistrate Judge Janie Mayeron issued her report and recommendation Thursday in a lawsuit brought against prescription drug retailers that allegedly did not pass savings on generic drugs to consumers. In suggesting remand to Hennepin County, she followed a decision by a Michigan federal court in similar cases.

Former U.S. District Judge James Rosenbaum, in dismissing the complaint in 2009, called the allegations "laughable." He allowed Bailey & Glasser of Charleston, W.Va., to amend the complaint, and the dispute over remand ensued.

The defendants - which include CVS, Target and Wal-Mart - argued the remand motion was untimely because it took the plaintiffs more than 100 days from the time the suit was removed to federal court.

"(T)he court is satisfied that plaintiffs and their counsel did not know that they had a reasonable basis for pursuing a remand until after the Michigan court issued its remand decision on Dec. 1, 2009," Mayeron wrote.

"In fact, the evidence before this court establishes that plaintiffs did not believe that the (Class Action Fairness Act) local controversy exception applied to this case, even after the Michigan court raised the issue at the pretrial conference."

The defendants had appealed Rosenbaum's remand order to the U.S. Court of Appeals for the Eighth Circuit, which overturned the order and directed the district court to determine if the plaintiffs' remand motion was made within a "reasonable" time frame.

U.S. District Judge Michael Davis was assigned the case after Rosenbaum retired.

In November 2009, Rosenbaum was annoyed that the complaint, filed against 13 defendants on behalf of unions that provide health care for their members, contained specific pricing information about only two of them.

"(T)his Complaint utterly fails to state a cause of action on any basis. There are no, none, factual allegations touching any defendant other than CVS and Walgreen's," Rosenbaum said.

"There being no facts from which a fact finder could infer any liability concerning (the other defendants), and you asked me to sustain a complaint based upon that. It's not only laughable, it's absolutely reprehensible.

"There's not a lawsuit here. There is not a claim. There is not an allegation. I've got words on a page."

The lawsuits in Michigan were dismissed by a state judge because the only specific pricing information was obtained by a West Virginia whistleblower who worked at Kroger.

The firm is also representing West Virginia Attorney General Darrell McGraw's office in a suit filed in the Mountain State. Currently, the two sides are fighting over whether the lawsuit should be heard in federal court, with the drug stores claiming it is a class action. They have appealed a Fourth Circuit ruling to the U.S. Supreme Court.

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