Melson, Adrian v. Bayer Corporation ( 2007 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 06-1427
IN RE
FACTOR VIII OR IX CONCENTRATE
BLOOD PRODUCTS LITIGATION
DOMENICO GULLONE, et al.,
Plaintiffs-Appellants,
v.
BAYER CORPORATION, et al.,
Defendants-Appellees.
____________
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
MDL No. 986; No. 1:03-CV-8928—John F. Grady, Judge.
____________
ARGUED SEPTEMBER 13, 2006—DECIDED MAY 4, 2007
____________
Before BAUER, WOOD, and WILLIAMS, Circuit Judges.
WOOD, Circuit Judge. In the early 1980s, the HIV/AIDS
epidemic burst onto the scene. Its seriousness could not
be overstated: AIDS ravaged the immune systems of its
victims and seemed to be inevitably fatal. Although
initially the disease seemed to target gay men, it soon
became apparent that it could strike anyone who was
exposed to it. According to a history of AIDS prepared by
the National Institutes of Health, “By the summer of
2 No. 06-1427
1982, scientists had convincing evidence that AIDS must
be caused by a blood-borne and sexually transmitted
virus.” See “In Their Own Words: NIH Researchers Recall
the Early Years of AIDS,” http://aidshistory.nih.gov/
tip_of_the_iceberg/index.html (visited April 5, 2007). One
group that proved to be especially vulnerable was hemo-
philiacs, who need frequent transfusions of blood factors
that cause clotting. Before 1985, when it became possible
to test donated blood to ensure that it was free of the AIDS
virus, close to half of all hemophiliacs became infected
with the virus. See Gina Kolata, Hemophilia and AIDS:
Silent Suffering, N.Y. TIMES, May 16, 1988.
The appeals now before us are the fourth in a series that
has arisen from litigation brought by hemophilic individu-
als who were infected with HIV or Hepatitis C virus (HCV)
by contaminated blood products known as Factor VIII and
Factor IX (“Factor Concentrates”). See also In re Factor
VIII or IX Concentrate Blood Prods. Litig., 159 F.3d 1016(7th Cir. 1998) (enforcing a settlement); In the Matter of
Rhone-Poulenc Rorer Pharms., Inc., 138 F.3d 695 (7th Cir.
1998) (denying a petition for a writ of mandamus relat-
ing to the designation of expert witnesses for trial); In the
Matter of Rhone-Poulenc Rorer, Inc., 51 F.3d 1293 (7th Cir.
1995) (reversing a partial class certification). Turning to
many federal courts around the United States, the plain-
tiffs sued a number of major drug companies (“the Drug
Companies”). These suits, which were consolidated by
the Judicial Panel on Multidistrict Litigation in the
Northern District of Illinois under the docket number
MDL-986, claimed that the defendant companies had
intentionally recruited urban homosexuals, prisoners, and
intravenous drug users to serve as blood donors, even
though they knew that these donors were at high risk of
carrying blood-borne diseases including the viruses that
cause AIDS and Hepatitis C. The Drug Companies alleg-
edly also failed to disclose the known risks of their prod-
No. 06-1427 3
ucts; failed to use available screening tests; failed to use
available treatments for killing the viruses in the plasma;
and continued to export non-heat-treated Factor Concen-
trates overseas after adopting safer methods for products
sold in the United States.
The cases brought by many of the plaintiffs are still
pending before the district court. Gullone v. Bayer Corp.,
however, was brought by a group from the United King-
dom, Italy, Germany, Israel, Argentina, and the State of
Nebraska. Finding that the United Kingdom would be
a more appropriate forum in which to handle the claims of
the U.K. plaintiffs, the district court granted a motion by
the Drug Companies to dismiss those claims on the ground
of forum non conveniens; it certified that ruling as final
and ready for appeal under FED. R. CIV. P. 54(b). Although
we find it a close call, largely because the district court
placed surprisingly little weight on the interest of Califor-
nia (the original forum) in this litigation and it may have
over-estimated the administrative difficulties in keeping
the case in the United States, we conclude in the end
that the court acted within its discretion when it dis-
missed the case. We therefore affirm.
I
As we noted earlier, litigation about Factor Concentrate
has been going on for some time; this case, along with its
companions in the MDL, belongs to the “second genera-
tion” group. The district court described the earlier, “first
generation” cases, in its opinion in order to provide the
background for its ruling in the Gullone litigation. We
include the highlights of that discussion here.
The preferred treatment for hemophilia, a hereditary
disease in which the protein that causes blood clotting
is missing, is intravenous injection of the necessary
4 No. 06-1427
protein. The protein used in these treatments is derived
from the plasma of donated blood. Using a process called
“fractionating,” the manufacturer can derive Factor
Concentrates from the plasma; the Factor Concentrates
are then sold for use by hemophiliacs. The principal four
defendants throughout these proceedings have been Baxter
Healthcare Corporation, Bayer Corporation, Alpha Thera-
peutic Corporation, and Armour Pharmaceutical Com-
pany; together, they produce practically all of the Factor
Concentrates used in the United States. If the donated
blood from which the Factor Concentrate is derived is
contaminated with HIV or HCV, then the resulting
concentrate may also be contaminated, unless it is sub-
jected to a heat treatment or other method of viral inacti-
vation. It is undisputed that some contaminated Factor
Concentrates were sold, and that this was the way in
which many hemophiliacs contracted AIDS or Hepatitis C.
The first generation lawsuits were brought against the
Drug Companies by hemophiliacs who had contracted
AIDS, their family members, and their personal represen-
tatives. The basic legal theory underlying these suits
was negligence. See In re Rhone-Poulenc Rorer, Inc., 51
F.3d at 1300. Most of those claims were resolved in 1997
through a settlement. See In re Factor VIII or IX Concen-
trate Blood Prods. Litig., 159 F.3d at 1020 (approving the
settlement). The “second generation” claims arose from
allegations of knowing misconduct directed specifically
toward victims outside the United States. The Gullone
case was filed in the Northern District of California on
June 3, 2003; many other suits on behalf of other foreign
victims, from many other countries, followed in the courts
of California, Florida, Illinois, and Texas. All of these
cases were collected in the same multi-district litigation
proceeding, MDL-986, that existed for the first-generation
cases.
At this point, the only forum non conveniens ruling
before us is the district court’s decision to sever the claims
No. 06-1427 5
of the U.K. plaintiffs and to dismiss those claims so that
they may be pursued in the courts of the United Kingdom.
The fact that the United Kingdom may—or may not—be
an adequate alternative forum obviously says nothing
about the adequacy of any other proposed country. Indeed,
because we review the district court’s forum non con-
veniens determination for abuse of discretion, see Piper
Aircraft Co. v. Reyno, 454 U.S. 235, 254 (1981), and the
relevant inquiry depends heavily on the particular facts
of the case, our discussion is not meant to suggest any-
thing about other such motions that may be brought in
these cases.
II
The Supreme Court recently revisited the topic of forum
non conveniens in Sinochem International Co. v. Malaysia
International Shipping Corp., 127 S.Ct. 1184 (2000), which
dealt with the question whether a district court may
dismiss on grounds of forum non conveniens without
first assuring that it has jurisdiction over the suit. In the
course of deciding that it is permissible to take up the
issue about the forum first, the Court reviewed the basic
contours of forum non conveniens:
A federal court has discretion to dismiss a case on the
ground of forum non conveniens when an alternative
forum has jurisdiction to hear [the] case, and . . . trial
in the chosen forum would establish . . . oppressive-
ness and vexation to a defendant . . . out of all propor-
tion to plaintiff ’s convenience, or . . . the chosen forum
[is] inappropriate because of considerations affecting
the court’s own administrative and legal problems.
Dismissal for forum non conveniens reflects a court’s
assessment of a range of considerations, most notably
the convenience to the parties and the practical
difficulties that can attend the adjudication of a
dispute in a certain locality. We have characterized
6 No. 06-1427
forum non conveniens as, essentially, a supervening
venue provision, permitting displacement of the
ordinary rules of venue when, in light of certain
conditions, the trial court thinks that jurisdiction
ought to be declined.
Sinochem, 127 S.Ct. at 1190.
The Court continues to recognize Gulf Oil Corp. v.
Gilbert, 330 U.S. 501 (1947), as the leading case recogniz-
ing and delineating the common-law doctrine of forum non
conveniens. See Quackenbush v. Allstate Ins. Co., 517 U.S.
706, 723 (1996); American Dredging Co. v. Miller, 510 U.S.
443, 447-49 (1994). In American Dredging, the Court
described the scope of the doctrine and repeated the
passage from Gulf Oil that describes what ought to
inform a district court’s decision:
An interest to be considered, and the one likely to be
most pressed, is the private interest of the litigant.
Important considerations are the relative ease of
access to sources of proof; availability of compulsory
process for attendance of unwilling, and the cost of
obtaining attendance of willing, witnesses; possibility
of view of premises, if view would be appropriate to
the action; and all other practical problems that make
trial of a case easy, expeditious and inexpensive. There
may also be questions as to the enforcibility [sic] of a
judgment if one is obtained . . . .
Factors of public interest also have [a] place in apply-
ing the doctrine. Administrative difficulties follow
for courts when litigation is piled up in congested
centers instead of being handled at its origin. Jury
duty is a burden that ought not to be imposed upon the
people of a community which has no relation to the
litigation. In cases which touch the affairs of many
persons, there is reason for holding the trial in their
view and reach rather than in remote parts of the
No. 06-1427 7
country where they can learn of it by report only.
There is a local interest in having localized controver-
sies decided at home. There is an appropriateness, too,
in having the trial of a diversity case in a forum that
is at home with the state law that must govern the
case, rather than having a court in some other forum
untangle problems in conflict of laws, and in law
foreign to itself.
510 U.S. at 447-49 (quoting Gulf Oil, 330 U.S. at 508-09).
Piper Aircraft added two additional points that are
important here. The first one was repeated in Sinochem:
when the plaintiff has sued in his or her home forum,
there is a strong presumption in favor of that choice. See
Piper Aircraft, 454 U.S. at 255-56 (citing Koster v.
Lumbermens Mut. Cas. Co., 330 U.S. 518, 524 (1947)).
Under those circumstances, “A defendant invoking forum
non conveniens . . . bears a heavy burden in opposing the
plaintiff ’s chosen forum.” Sinochem, 127 S.Ct. at 1191.
Conversely, if the plaintiff is suing far from home, it is
less reasonable to assume that the forum is a con-
venient one and therefore “the presumption in the plain-
tiff ’s favor ‘applies with less force. . . .’ ” Id. (quoting Piper
Aircraft, 454 U.S. at 266). Put the other way, the risk that
the chosen forum really has little connection to the litiga-
tion is greater. We do not understand this as any kind of
bias against foreign plaintiffs. That would be incon-
sistent with many treaties the United States has signed
as well as with the general principle that our courts are
open to all who seek legitimately to use them. It is instead
a practical observation about convenience. A citizen of
Texas who decided to sue in the federal court in Alaska
might face an equally skeptical court, which might con-
clude that convenience requires a change in venue under
the federal statutory counterpart to forum non conveniens,
28 U.S.C. § 1404(a).
8 No. 06-1427
The other important point Piper Aircraft made was that
a dismissal based on forum non conveniens that is other-
wise appropriate should not ordinarily be rejected just
because it would lead to a change in applicable law
unfavorable to the plaintiff. 454 U.S. at 247, 254. Only
if “the remedy provided by the alternative forum is so
clearly inadequate or unsatisfactory that it is no remedy
at all” should the unfavorable change be given substan-
tial—or even dispositive—weight. Id. at 254.
With these principles in mind, we are now ready to turn
to the district court’s decision to dismiss the claims of the
U.K. plaintiffs here, based on its evaluation of the relative
convenience of the United States and the United Kingdom
as potential fora for this litigation. As we noted earlier, the
standard of review is a deferential one: we may reverse
only if we conclude that the district court abused its
discretion.
III
The plaintiffs’ principal argument is that the court erred
when it found that the United Kingdom is an adequate
alternative forum for this case. The British courts fall
short, they argue, because (as they put it) “the U.K. legal
system strictly adheres to the ‘but for’ principles of causa-
tion and does not acknowledge market share or its vari-
ants that are available in the U.S.” They acknowledge that
a recent decision of the House of Lords, which sits as the
highest court in the United Kingdom, has muddied the
waters on that absolute proposition. See Fairchild v.
Glenhaven Funeral Servs., Ltd., (2003) 1 A.C. 32 (H.L.).
In Fairchild, the Law Lords found that a plaintiff was
entitled to recover in an asbestos case even though he
could not identify which of his several employers may
have exposed him to the asbestos fiber that caused his
eventual mesothelioma. Plaintiffs here are pessimistic,
No. 06-1427 9
however, that the U.K. courts would extend the holding
in Fairchild to their situation.
The district court devoted considerable attention to the
question whether the U.K. courts are the kind of alterna-
tive forum the Supreme Court contemplates in its line of
forum non conveniens cases. It heard expert testimony
from experienced British lawyers, some of whom supported
the plaintiffs (for example, Professor Adrian Briggs and
Mark Mildred) and others (principally Nicholas Underhill)
who supported the Drug Companies. Underhill, who has
served as leading defense counsel in the two principal
product liability cases brought in the United Kingdom in
recent years—including a case brought by hemophiliacs
against public health authorities—opined that the English
courts would certainly entertain the cases and would be
likely to rely on a straightforward negligence theory. He
thought that it would be necessary for each plaintiff to
allege and prove which defendant’s concentrate was
responsible for his infection. Mildred, in contrast, was a
solicitor who coordinated the plaintiffs’ case in the
HIV litigation. Mildred acknowledged that it was
possible that the British courts might apply the Fairchild
exception to this case (and thus permit plaintiffs to re-
cover without identifying a particular manufacturer), but
he thought this was unlikely.
The district court looked carefully at Fairchild, in the
light of this expert testimony. Lord Bingham of Cornhill,
who delivered the lead speech, noted that in the case of
mesothelioma caused by inhalation of asbestos fiber,
“[ M]edical science cannot support the suggestion that any
of these possibilities [i.e., that the fiber triggering the
disease originated with manufacturer A or B] is to be
regarded as more probable than any other. There is no way
of identifying, even on a balance of probabilities, the
source of the fibre or fibres which initiated the genetic
process which culminated in the malignant tumour.”
10 No. 06-1427
1 A.C. at 43. The other Law Lords came to similar conclu-
sions, rejecting the conventional “but for” test of tortious
liability in the special circumstances of the case before
them.
The problem faced by the plaintiffs, in the district court’s
view, was identical. With the exception of one plaintiff
who apparently used nothing but the concentrate of one
fractionator, a hemophiliac infected with HIV or HCV has
no way of knowing either when he was infected or by
what particular infusion of concentrate. Over time,
hemophiliacs are likely to use more than one brand of
concentrate, depending on what their supplier has in stock.
Further complicating matters is the fact that the virus
may not be detectible in the blood of the infected person
until many years after the infusion that caused the
infection. The district court concluded that situation is
indistinguishable from the facts of Fairchild, and that
it was “very unlikely” that the courts of the United King-
dom would apply ordinary “but for” causation to the
Gullone case. Instead, it predicted, they would apply the
Fairchild exception to the causation element and pro-
ceed to adjudicate the claims.
This court held in Kamel v. Hill-Rom Co. that there
are two parts to the “alternative forum” inquiry: availabil-
ity and adequacy. 108 F.3d 799, 802 (7th Cir. 1997). Kamel
explained that “[a]n alternative forum is available if all
parties are amenable to process and are within the forum’s
jurisdiction. An alternative forum is adequate when the
parties will not be deprived of all remedies or treated
unfairly.” Id. at 803 (citation omitted). There is no ques-
tion that the U.K. courts are available; the Drug Compa-
nies are amenable to process there and the district court
conditioned its dismissal of the action on their agree-
ment to accept service in actions in the U.K. courts (and
to comply with several other obligations as well). The real
question is whether the court’s conclusion that the U.K.
No. 06-1427 11
courts offer an “adequate” alternative was within its
discretion. We think that it was. Piper Aircraft establishes
that the law in the United Kingdom need not be identical
to U.S. law, or even as favorable to plaintiffs as U.S. law
may be. The Fairchild decision demonstrates that the
highest court of the United Kingdom has, at least in one
setting, recognized the need to modify strict “but for” rules
in this kind of case. We do not know, of course, whether
the U.K. courts will apply Fairchild to the present case,
but that kind of certainty is not required (especially in
a common-law system like theirs). Lord Cornhill’s speech
in Fairchild recognized that the doctrine the Lords
adopted there would grow over time, saying that “[i]t
would be unrealistic to suppose that the principle here
affirmed will not over time be the subject of incremental
and analogical development. Cases seeking to develop
the principle must be decided when and as they arise.”
Fairchild, 1 A.C. at 68. Finally, the fact that the Fairchild
result has apparently been codified for purposes of asbes-
tos cases, see Compensation Act 2006, 2006 c. 29 (U.K.),
does not mean that the ordinary common-law process has
been foreclosed for other types of cases.
As we noted earlier, Gulf Oil identified a number of
private-interest factors that should be considered in
connection with a motion to dismiss for forum non
conveniens: (1) relative ease of access to sources of proof;
(2) availability of compulsory process and costs for at-
tendance of witnesses; (3) possibility of view of premises,
if appropriate; and (4) other practical issues, including
ease of enforcement of any ultimate judgment. See Gulf
Oil, 330 U.S. at 508. Plaintiffs argue that there are
“extreme impediments” to their funding of the litigation,
if it were to proceed in the United Kingdom, largely
because the English legal system uses a “loser pays” rule
for attorneys fees and because compensatory damages
tend to be low. We do not see how the use of a different
12 No. 06-1427
fee-shifting rule for attorneys’ fees can weigh against
dismissal, however, in light of Piper Aircraft. Obviously
the English Rule is less favorable to plaintiffs whose
chances of losing are too great (which, for risk-averse
plaintiffs, might even be 30% or 40%), but we believe that
must be regarded as the kind of unfavorable difference in
legal system that carries little weight. In fact, the United
States stands almost alone in its approach toward attor-
neys’ fees, and so if we were to find that dismissal was
wrong for this reason, we would risk gutting the doctrine
of forum non conveniens entirely.
The district court was persuaded that the private-
interest factors tended to show that the United Kingdom
was the preferable forum. Although it thought that access
to discovery was not a factor favoring dismissal, the other
private interests—especially the ability of the defendants
to join as third-party defendants various non-U.S.
parties—supported its action. It found many of these
factors to be in balance, including access to evidence
and ease of discovery.
Turning to the public-interest factors, we begin with the
district court’s analysis of the administrative difficulties
that could arise in either forum. The court assumed
comparable congestion in the two legal systems, and then,
without much explanation, concluded that “the administra-
tive difficulties stemming from court congestion strongly
favor the U.K. forum.” In reaching that conclusion, it
appeared to give substantial weight to the fact that there
would be no jury trial in the United Kingdom, whereas
there would be a Seventh Amendment right to a jury in
the United States.
In our view, the fact that a plaintiff may exercise her
constitutional right to a jury trial is not something that
properly may weigh against keeping a case in the United
States. To the extent that court congestion matters, what
No. 06-1427 13
is important is the speed with which a case can come to
trial and be resolved. See Gates Learjet Corp. v. Jensen,
743 F.2d 1325, 1337 (9th Cir. 1984). In Gates Learjet, the
court held, “[T]he real issue is not whether a dis-
missal will reduce a court’s congestion but whether a trial
may be speedier in another court because of its less
crowded docket.” Id. In addition, the court noted that “[t]he
forum non conveniens doctrine should not be used as a
solution to court congestion; other remedies, such as
placing reasonable limitations on the amount of time
each side may have to present evidence, are more appro-
priate.” Id. Apart from administrative convenience, the
Gulf Oil decision also notes that jury duty ought not to
be imposed on the people of a community that has “no
relation” to the litigation. As we discuss in a moment,
however, California cannot be described that way. In our
view, the burdens of jury duty are closely linked with the
local interest in the litigation; they are not a separate
reason to reject a case. Once we remove the jury question
from the picture, the record is silent about the relative
administrative advantages or disadvantages of California
and the United Kingdom. We therefore regard this
factor as neutral.
The district court thought that the United Kingdom’s
interest in the Gullone litigation substantially out-
weighed that of California. It noted that the U.K. govern-
ment has shown considerable interest in the plight of
hemophiliacs who became infected with HIV and HCV.
There is also the obvious point that their medical care
will be furnished at home and that the human impact of
their illness will be felt first and foremost where they
live. On the other hand, plaintiffs point out that California
has an interest in the case because defendants Alpha,
Bayer, and Cutter are headquartered there; defendant
Bayer has its main manufacturing plant for Factor Con-
centrates there; and the plasma collection process took
14 No. 06-1427
place there. These are not trivial local interests. They
certainly do not make California a forum with “no relation”
to the litigation. In the end, a rational person might come
to either conclusion on this record: some might think that
the greater interest lies in the place where the companies
operated and allegedly committed the wrongs; others
might find a greater interest in the place where the
victims suffer from those wrongs and where the financial
impact of the consequences will fall. Put another way, the
record contains enough evidence to support the conclu-
sion that the citizens of the United Kingdom have a
greater interest in this controversy than those of the
Northern District of California. In light of the fact that the
plaintiffs have not sued in their home forum, and there-
fore that the presumption of convenience in their favor
“applies with less force,” Sinochem, 127 S.Ct. at 1191, we
see no reversible error in the district court’s conclusion
that the defendants met their burden here.
IV
The ruling on the Drug Companies’ motion for dismissal
on the basis of forum non conveniens easily could have
gone either way. We therefore cannot say that the court
abused its discretion when it concluded that the defen-
dants’ motion should be granted. The judgment of the
district court is AFFIRMED.
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—5-4-07