Please take notice that the attached Magistrate Judge’s Report has been filed with the Clerk of the U. S. District Court.
In accordance with 28 U.S.C. §636(b)(1), you have 14 days after being served with the attached report to file writtenobjections to the proposed findings of fact, conclusions of law,and recommendations set forth therein. Failure to file writtenobjections to the proposed findings, conclusions andrecommendations within 14 days after being served will bar you,except upon grounds of plain error, from attacking on appeal theunobjected-to proposed factual findings and legal conclusionsaccepted by the District Court.
Baton Rouge, Louisiana, March 5, 2012.
Before the court is the State’s Motion to Remand filed by plaintiff James D. “Buddy” Caldwell, Attorney General of the State Careful consideration of the allegations in the plaintiff’s Original Petition for Civil Penalties and Damages and Jury Demand and the applicable law supports the conclusion that the defendants failed to satisfy their burden of establishing federal question jurisdiction, and that the State’s Motion to Remand should be Background
Plaintiff filed an Original Petition for Civil Penalties and Damages and Jury Demand (hereafter, “Petition”), in state court against defendants Abbott Laboratories, Abbott Laboratories, Inc., (hereafter, collectively “Abbott”) and one hundred John Doe 1 Record document number Plaintiff filed a reply memorandum. Record document number .
Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 2 of 22 defendants.2 Plaintiff generally alleged that the defendant is liable for deceptive, false, misleading, reckless and fraudulent acts and practices in the marketing, promotion, pricing and selling of Depakote products3 in Louisiana. Plaintiff sued to collect damages, restitution, civil fines and penalties, interest, costs and attorney’s fees from the defendant under five state law provisions and theories of recovery: (1) Count One - Louisiana’s Medical Assistance Programs Integrity Law (“MAPIL”), LSA-R.S.
46:437.1, et seq.;4 (2) Count Two - Louisiana’s Unfair Trade Practices and Consumer Protection Law (“LUTPCPL”), LSA-R.S.
51:1401, et seq.;5 (3) Count Four - Redhibition under Louisiana Civil Code Article 2520;6 (4) Count Five - Fraud under Louisiana Civil Code Article 1953;7 and (5) Count Six - Unjust Enrichment 2 Plaintiff alleged that the John Doe defendants are all past and present individuals, corporations, limited liability companiesand other business entities, who or which conspired with Abbott inthe unlawful, fraudulent marketing schemes alleged in the Petition. Record document number , Exhibit F, Petition, ¶ 36-38. Sincethese defendants are unidentified, the rest of this report onlyrefers to defendant Abbott.
3 Plaintiff alleged that the defendant sold divalproex sodium under the trade names Depakote, Depakote DR, Depakote ER, Depacon,and Depakote Sprinkles. , ¶ 2.
Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 3 of 22 under Louisiana Civil Code Article 2298.8 Plaintiff alleged that the claims are based exclusively on Louisiana law and no claims arising under the law of the United States were asserted.9 Defendant removed the case and asserted federal question jurisdiction under 28 U.S.C. § 1331. In the Notice of Removal the defendant acknowledged that the five claims alleged by the plaintiff are all brought under state law.10 Defendant argued that removal is nonetheless proper because the allegations underlying the state law claims demonstrate the existence of an embedded federal issue that is actually disputed and substantial and warrants the exercise of federal question jurisdiction. Plaintiff moved to remand for lack of subject matter jurisdiction under § Applicable Law
The party invoking removal jurisdiction bears the burden of establishing federal jurisdiction over the state court suit. Frank v. Bear Stearns & Company, 128 F.3d 919, 921-22 (5th Cir. 1997). To support removal the defendant must locate the basis of federal jurisdiction in the allegations necessary to support the 8 , ¶ 417-423. In Count Three the plaintiff alleged equitable tolling of any applicable prescriptive periods. InCounts Seven through Twelve the plaintiff asserted the same claimsand allegations against the John Doe defendants that were allegedagainst Abbott in Counts One through Six.
Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 4 of 22 plaintiff’s claims, ignoring the defendant’ own pleadings and notice of removal. Gully v. First National Bank, 299 U.S. 109, Absent diversity of jurisdiction, removal is appropriate only for those claims within the federal question jurisdiction of the district courts. 28 U.S.C. § 1331. It is well established that the “arising under” language of § 1331 has a narrower meaning than the corresponding language in Article III of the Constitution which defines the limits of the judicial power of the United States. Federal question jurisdiction is generally invoked by plaintiff pleading a cause of action created by federal law. However, another well-established but less frequently encountered form of federal “arising under” jurisdiction, is that in certain cases federal-question jurisdiction will lie over state law claims that implicate significant federal issues. Grable & Sons Metal Prods., Inc. v. Darue Eng’g & Mfg., 545 U.S. 308, 125 S.Ct. 2363 (2005). Thus, a federal question exists only in “those cases in which a well-pleaded complaint establishes either that federal law creates the cause of action or that the plaintiff’s right to relief necessarily depends on resolution of a substantial question of federal law.” Franchise Tax Bd. v. Constr. Laborers Vacation Trust, 463 U.S. 1, 27-28, 103 S.Ct. 2841 (1983); Singh v. Duane Morris LLP, 538 F.3d 334, 337-38 (5th Cir. 2008). However, as the Fifth Circuit observed in Singh, the Supreme court has subsequently Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 5 of 22 warned that Franchise Tax Board’s “necessary-resolution” language is no automatic test, and should be read as part of a carefully nuanced standard rather than a broad, simplistic rule.
The fact that a substantial federal question is necessaryto the resolution of a state-law claim is not sufficientto permit federal jurisdiction: Franchise Tax Board .
did not purport to disturb the long-settled understandingthat the mere presence of a federal issue in a statecause of action does not automatically confer federal-question jurisdiction. Likewise, the presence of adisputed federal issue is never necessarily dispositive. Instead, far from creating some kind of automatic test,Franchise Tax Board thus candidly recognized the need forcareful judgments about the exercise of federal judicialpower in an area of uncertain jurisdiction. (internalquotations and citations omitted).
The Supreme Court’s most recent summation of the standard for determining whether an embedded federal issue in a state law claim raises a substantial question of federal law is set forth in Grable. The Court stated: “[] 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, 545 U.S. at 314, 125 S.Ct. at 2368. The lack of a private cause of action is relevant to, but not dispositive of, the question of whether the right is substantial enough to satisfy the exercise of federal jurisdiction. The federal issue must be a substantial one that indicates a serious federal interest in claiming the advantages inherent in a federal Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 6 of 22 forum. However, the presence of a disputed federal issue and the importance of a federal forum are never dispositive. The court must always assess whether the exercise of federal jurisdiction would be consistent with congressional judgment about the sound division of labor between state and federal courts governing the application of § 1331. Grable, 545 U.S. at 313, 125 S.Ct. at 2367, The Parties’ Arguments
Plaintiff argued that the state law claims alleged do not require resolution of any federal issue, much less a disputed and substantial one. Plaintiff acknowledged that the Petition contains multiple references to the federal Food and Drug Administration (“FDA”) and the federal Food Drug and Cosmetic Act (“FDCA”), but argued that the Petition does not challenge federal law or regulations or the federally approved labeling of Depakote. Plaintiff maintained that the defendant’s liability under state law does not depend on the violation of a federal statute or regulation or any federally approved label. Plaintiff argued that neither the federal interest in the basic subject matter of the suit, nor the fact that federal funds comprised a large part of the money paid for the Depakote products, is sufficient to confer federal question Plaintiff also maintained that exercising federal jurisdiction over the state law claims would interfere with congressional Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 7 of 22 judgment about the division and balance of responsibilities between state and federal courts. Plaintiff argued that principles of federal-state comity dictate that claims alleged exclusively under state law and brought by the state to protect its citizens and consumers should be heard in state court; to conclude otherwise would deny the police powers of the state. In support of its position the plaintiff also pointed out that: (1) Congress did not establish a private right of action or preemption under federal law for the types of claims alleged, which are traditionally adjudicated in state court; (2) the majority of federal courts have remanded similar cases; and, (3) this case requires a fact-bound and situation-specific analysis and does not fall into the slim category defined by Grable, where resolution of the case turned on deciding a pure issue of federal law.
Defendant argued that the numerous references to federal law in the Petition are not incidental. Rather, the allegations demonstrate that the plaintiff has invoked the FDCA and FDA regulations as the sole basis for its claims of false or fraudulent promotion under state law. According to the defendant, the alleged state law claims turn on the resolution of a fundamental federal question, that is, whether promoting Depakote for uses not approved or indicated by the FDA violated federal law and regulations. Thus, the defendant remained steadfast in the position that the plaintiff’s state law claims raise significant federal issues that Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 8 of 22 are not merely relevant to the elements of the claims, but are a necessary predicate to proving those claims.
The allegations of the Petition determine whether federal question jurisdiction exists in this case. Defendant appeared to rely on a quantitative approach, that is, reciting the number of times the Petition refers to the FDA, “off-label” and “off-label The centrality of the federal issues involved in thiscase is evident from even a cursory review of the State’sPetition. The State references “off-label” marketing in16 of the 21 headings of the Petition and the term “off-label” appears a total of 257 times throughout its 125page Petition, an average of more than twice per page. Plaintiff likewise references the FDA by name over 50times, and spends pages of its Petition detailing thefederal FDA approval process for drugs and for federally-approved product labeling. (Pet. ¶¶ 63, 65-66, 69-71)Because the entire Petition is based on allegations of“off-label” promotion, which can only mean promotion thatviolates a federal statute and federal regulations,federal law issues form the entire foundation of theState’s claims.11 Contrary to the defendant’s argument, the number of references to “off-label” and the FDA is not controlling or necessarily determinative. The references may be indicative of an actually disputed and substantial federal question, or only the mere presence of a federal issue. It is the substance of the allegations necessary to support the plaintiff’s claims which Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 9 of 22 determines whether any federal issues embedded in the state law claims raise a substantial question of federal law.
Citing paragraphs 63-71 of the Petition, the defendant argued that at the core of the plaintiff’s claims is the allegation that Abbott engaged in off-label promotion of Depakote, and that resolution of this issue requires a determination of whether the drug was marketed in a manner inconsistent with the federally- approved uses described in the federally-approved label. But in paragraph 65 the plaintiff specifically alleged that a physician “may prescribe a drug for uses that are different than those indicated on the label.” Plaintiff alleged further that in contemplating “on- or off-label use” a physician relies on patient- specific evidence, and that much of the other information the representatives and drug-company-sponsored medical education courses, speaker programs and clinical trials.
The remaining allegations demonstrate that the core of the Petition is the allegation that Abbott unlawfully influenced the off-label prescribing decisions of physicians and providers by intentionally supplying them with false, fraudulent and misleading information about the appropriateness and effectiveness of prescribing Depakote in those situations not covered by the FDA labeling and information. The following act and omissions by Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 10 of 22 Abbott are detailed in the Petition:12 (1) knowingly misrepresented evidence concerning the effectiveness and safety of the off-label uses of Depakote products; (2) knowingly marketed and promoted Depakote products for uses that were not effective and/or safe, i.e. not supported by demonstrable scientific facts or substantial and reliable medical and scientific opinion; (3) knowingly created off-label consensus guidelines on the use of Depakote products in a way that made them appear to be written by independent researchers, but were in fact sponsored or ghost-written by Abbott and/or its agents; (4) improperly sent these publications out to physicians and providers through requests by sales representatives that were made to appear to be requests from the physicians and 12 See record document , Petition, ¶ 5. The Petition has 478 numbered paragraphs. It is not necessary to list orsummarize all of the plaintiff’s allegations here. Viewing thePetition as a whole, paragraph 5 gives a fair summary of thealleged false, fraudulent and misleading actions the defendant usedto market and promote the off-label uses of Depakote to physiciansand other providers.
Paragraph 62 of the Petition also summarized at least three illegal schemes which resulted in false claims being submitted toLouisiana Medicaid and medical assistance programs. These include: (1) marketing off-label uses of Depakote to Louisianagovernment-pay prescribers and providers in violation of MAPIL; (2)using misrepresentations and deceptive, false and/or fraudulentrecords and/or statements to persuade physicians and health careproviders to prescribe Depakote ER for off-label purposes, to writenew prescriptions for Depakote ER and to prescribe Depakote ERinstead of Depakote DR to increase its profits in violation ofMAPIL, LUTPCPL, and other state laws and statutes; and, (3) usingillegal remuneration, including kickbacks, honoraria, gifts andrebates to induce physicians and healthcare providers to prescribeDepakote in violation of MAPIL, LUTPCPL, and other Louisiana lawsand statutes.
Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 11 of 22 providers; (5) paid financial inducements to key opinion leaders who gave presentations concerning the off-label uses at promotional speaker or continuing medical education programs, despite the lack of scientific facts or substantial and reliable medical and scientific opinion to support the off-label uses of Depakote products, and also funded the creation and dissemination of standing orders for off-label uses so that patients would be treated with Depakote products without a physician having to write a prescription; (6) knowingly funded and disseminated consensus guidelines to promote the off-label use of Depakote products for the treatment of agitation and aggression associated with dementia, representing that they were prepared by unbiased experts when in fact the preparers were paid by Abbott for the purpose of increasing sales of Depakote products.
This summary demonstrates that the gravamen of the plaintiff’s alleged violations of state law is not that Abbott simply promoted and marketed Depakote products for off-label uses, but that they did so by false, fraudulent and misleading practices. As alleged in the Petition, these types of practices resulted in misbranding Depakote in violation of the Louisiana Food Drug and Cosmetic Act (LFDCA). LSA-R.S. 40:601, et seq.13 The alleged violation of the 13 Under LSA-R.S. 40:617A a drug or device is “misbranded” if it has been found to be such by any department of the United Statesgovernment, or: (1) If its labeling is false or misleading in any Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 12 of 22 LFDCA resulted in the submission of false claims to Louisiana Medicaid and medical assistance programs to pay for Depakote products which would not have been prescribed or administered but for the defendant’s false, fraudulent and misleading conduct in the marketing and promotion of Depakote.14 This, the “misbranding” in violation of state law is the basis for the state law claims on for Depakote products are prescription drugs. Therefore, general references to federal law, regulations and labeling do not necessarily indicate the presence of a disputed, substantial federal issue. Review of the Petition shows that the numerous references to the FDA, FDCA and off-label are either alleged as background information or as facts relevant to describing the 13(.continued)particular. Any representation concerning any effect ofa drug or device is considered false for purposes of thisParagraph if the representation is not supported bydemonstrable scientific facts or substantial and reliablemedical or scientific opinion.
(2) If it is dangerous to health under the conditions ofuse prescribed in the labeling or advertising thereof.
The LFDCA also defines “advertisement” to include all representations of fact or opinion disseminated to the public inany manner or by any means other than by the labeling, and“labeling” includes all labels and other written, printed andgraphic matter, in any form whatsoever that accompanies any food,drug, device or cosmetic. LSA-R.S. 40:602(1) and (8).
14 Plaintiff alleged that between 1997 and 2008 the defendant’s fraudulent and misleading promotion and marketing of Depakoteproducts caused Louisiana Medicaid and medical assistance programsto reimburse providers over $35 million dollars. Record document, Petition, ¶ 18.4.
Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 13 of 22 defendant’s fraudulent, false and misleading scheme to convince physicians and providers to prescribe or administer Depakote.15 This conclusion is supported by a fair reading of the allegations in the Petition as a whole rather than only focusing on specific words and phrases scattered throughout its 478 paragraphs.
In determining whether the defendant’s actions violated state law, the federally-approved label will be examined and compared to the uses being promoted and marketed. But liability will not depend on this inquiry. Liability will turn on whether the defendant’s conduct was false or misleading, as defined by the LFDCA. Thus, the allegations in the Petition do not indicate that the violation of any federal law or regulation will be an actually disputed and substantial issue in determining whether the defendant’s actions violated state law.
Defendant argued that the entire Petition rests on allegations of off-label promotion, which can only mean promotion that violates Thus, the State’s claims turn on the resolution of afundamental federal question: whether Abbott violated thefederal Food Drug and Cosmetic Act (“FDCA”) andassociated federal regulations by promoting Depakote foruses not approved or indicated by the federal Food andDrug Administration (“FDA”).”16 15 See, e.g. record document , Petition, ¶¶ 50, 52- 58, 63, 66, 68-71, 74, 93, 147, 160, 162, 165, 171, 174, 175, 188,218, 220, 226, 239, 241, 245, 248, 265, 269, 272.
Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 14 of 22 But Abbott failed to persuasively explain why the state law claims turn on the resolution of this question, or why off-label promotion can only mean promotion that violates federal law and regulations. Nor did the defendant cite any specific federal statute or regulation that would be violated if the plaintiff merely establishes that Depakote was marketed and promoted for uses not approved or indicated by the FDA.
Defendant relied in part on copies of the pleadings filed against Abbott and others in federal False Claims Act cases involving the off-label marketing of Depakote.17 The district court in Virginia has original federal question jurisdiction in these actions based on the False Claims Act, and has supplemental jurisdiction over the claims by the various states, including Louisiana’s MAPIL claims alleged in three of the consolidated cases. Defendant pointed out that the allegations of off-label marketing and violations of the FDA and FDCA support both the False Claims Act and Louisiana cause of action, and that the Petition here simply copied the identical language from the federal suits and inserted a few more allegations and references to Louisiana law. Therefore, Abbott argued, the uniformity of the allegations 17 Copies of the complaints were filed with the Notice of Removal. Record document number , Exhibit B; record documentnumber Exhibit D; record document number , Exhibit E. These three actions along with another case are consolidated in theWestern District of Virginia. Record document , ExhibitA. There is no question of federal jurisdiction in these cases.
Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 15 of 22 and legal issues contained in the consolidated federal cases and the Petition illustrates the importance of the federal issues and the need for a consistent resolution in the federal courts.
This argument is unpersuasive. Defendant did not cite the specific allegations it claims were actually or essentially copied, nor did the defendant cite any legal authority for its argument that similarity between the allegations in a state court suit and a False Claims Act case supports finding a substantial federal issue in a suit alleging only violations of state law.
Defendant also argued that the Grable standard is met in this case because the plaintiff’s claims are predicated on violations of federal law. Defendant argued that Grable is binding, on-point authority supporting the finding that federal jurisdiction exists in this case.18 The Grable standards are binding, but the circumstances in Grable are not on-point. The factual and legal basis for concluding that there was federal question jurisdiction in Grable are easily distinguished. In Grable, whether the plaintiff was given proper notice within the meaning of the federal tax statute was an essential element of the plaintiff’s claim, and the only contested issue in the case. Contrary to the defendant’s assertion, the plaintiff here has not elected to invoke the FDA or FDCA or federal regulations as the sole basis for its claims. Rather, the allegations here show that the plaintiff’s claims (that Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 16 of 22 the defendant marketed and promoted Depakote for conditions, symptoms and patients that were not approved or indicated by the FDA) are just part of the alleged factual basis for proving the defendant violated the state laws cited in the Petition.
Pharmaceuticals, Inc. v. Thompson19 supports the conclusion that any federal issues embedded in the Petition are not substantial. Defendant argued that the plaintiff’s reliance on Merrell Dow is misplaced. Defendant’s argument is unpersuasive.
Defendant asserted that Merrell Dow does not warrant remand for two main reasons.20 First, the defendant noted that the case predated Grable, and that in Grable the Court stated that Merrell Dow did not overturn decades of precedent, and did not establish a bright-line rule for determining whether a case alleging state law claims involves substantial federal issues. Defendant failed to explain how this shows Merrell Dow does not support remand. Review of the Grable court’s entire discussion of Merrell Dow actually supports the conclusion that the federal issues in this Petition In Grable the Court did not retreat from the holding and 19 478 U.S. 804, 106 S.Ct. 3229 (1986). Merrell Dow involved the removal of a state court petition that alleged only state lawclaims of negligence, breach of warranty, strict liability, fraudand gross negligence against the manufacturer/distributor of theprescription drug Bendectin.
Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 17 of 22 reasoning in Merrell Dow. It clarified that the case “should be read in its entirety as treating the absence of a federal private right of action as evidence relevant to, but not dispositive of, the ‘sensitive judgments about congressional intent’ that § 1331 requires.” Grable, 545 U.S. at 318, 125 S.Ct. at 2370. The Court explained that in Merrell Dow it was the combination of no federal cause action and no preemption of state remedies for misbranding that provided an important indication that Congress would not have intended the exercise of federal question jurisdiction in circumstances which would have resulted in a potentially “enormous shift of traditionally state cases into federal courts.” Id. 319, The circumstances of this case are not any different. This case also involves a prescription drug. Abbott did not claim, and there has been no showing, that there is a private cause of action for violations of any FDCA/FDA law or regulations implicated by the plaintiff’s allegations. Nor has the defendant argued or shown that federal law preempts any of the state law claims and remedies 21 Defendant argued that the plaintiff alleged off-label promotion because proving off-label promotion is the only way theplaintiff can make a case without going against substantialprecedent holding that fraud claims based on promotion thatcomplies with federally-approved labeling is preempted by federallaw.
None of the cases cited by the defendant involved prescription drugs. Record document number , p. 12. They involved federal Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 18 of 22 Second, the defendant argued that Merrell Dow does not support a finding that a substantial federal question is lacking in this case because Merrell Dow involved a conventional personal injury claim, and the alleged FDCA violation was only one standard by which the plaintiff could prove his negligence claim. The defendant argued that “[b]y contrast the FDCA issues in this case are central, necessary elements of the State’s claims because proving off-label promotion is the State’s only avenue for proving its case.”22 This assertion is unsupported. Moreover, the Merrell Dow decision itself and the Court’s discussion of it in Grable demonstrate that there is no substantial federal issue present bases on the allegations in the state court Petition.
In Merrell Dow the plaintiff alleged that because the Bendectin labeling did not adequately warn that its use was potentially dangerous, it was misbranded in violation of the FDCA.; and the violation of the FDCA in the promotion of the drug created a rebuttable presumption of negligence under state law. The Court concluded that where Congress did not create a private federal remedy for violation of the FDCA, a complaint alleging a violation of the FDCA as an element of a state law cause of action did not laws that have preemption provisions - laws that apply to over-the-counter medications and medical devices. Nevertheless, throughthis argument the defendant essentially acknowledges thatpreemption of state law claims is not a factor in this case.
Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 19 of 22 give rise to a federal claim under § 1331. The Grable Court explained that other important factors were at work in Merrell Dow: (1) the absence of federal preemption of state remedies for misbranding; (2) if alleging the violation of federal labeling standards could get a state claim into federal court, so could alleging the violation of any other federal standard without a federal cause of action; and, (3)the result would attract a large number of original filings and removed cases raising other state claims with embedded federal issues to the federal courts.
Like Merrell Dow, the federal labeling standards will be an issue in this case. But that is true simply because the alleged fraudulent scheme which violated the LFDCA involved the marketing and promoting of off-label uses of the prescription drug Depakote. To prove that the scheme involved off-label uses, evidence of what was “on-label”, i.e. the federally approved label, will be relevant to proving the fraudulent scheme. However, unlike Merrell Dow, the plaintiff in this case has not alleged any violation of the FDCA, other federal law or regulations as proof of its state law claims. Plaintiff only alleged violations of the state misbranding law, which is an element of the state law claims under which the plaintiff is seeking relief. This makes the federal issues embedded in this Petition even less substantial than those present in Merrell Dow. To the extent the Petition can be construed to allege violations of the FDA or FDCA provisions governing off-label Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 20 of 22 marketing, as evidence to establish a violation of state law, the presence of such an issue would be similar to and no more substantial than the issue in Merrell Dow.
Finally, what the Grable court observed about Merrell Dow is also true in this case: if the need to introduce evidence of the federal labeling standards warrants exercising federal jurisdiction over purely state law claims, then this could potentially result in a significant shift to the federal courts of traditional state cases alleging fraud, redhibition and violation of state consumer protection laws. Such a shift would breach “Congress’s intended division of labor between state and federal courts.” Grable, 545 Conclusion
Defendant has the burden of establishing the existence of jurisdiction under § 1331. The Petition alleges only state law claims. Application of the legal standards established by the Supreme Court in Franchise Tax Board, Merrell Dow and Grable leads to the conclusion that the defendant failed to demonstrate that the Petition alleges claims which involve actually disputed and substantial federal issues a federal court may entertain without disturbing the congressionally-approved balance of federal and state judicial responsibilities. Defendant failed to satisfy its burden of establishing federal question jurisdiction. The State’s Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 21 of 22 Recommendation
It is the recommendation of the magistrate judge that the State’s Motion to Remand be granted.
Baton Rouge, Louisiana, March 5, 2012.
STEPHEN C. RIEDLINGER UNITED STATES MAGISTRATE JUDGE Case 3:11-cv-00542-BAJ -SCR Document 14 03/05/12 Page 22 of 22

Source: http://kanner-law.com/wp-content/uploads/2012/03/Caldwell-v.-Abbott.La_.-MD-Recommendation-to-Remand-2012.03.05.pdf


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