Nancy Axline v. 3M Company ( 2021 )

United States Court of Appeals
For the Eighth Circuit
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No. 19-1180
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Nancy Axline
Plaintiff - Appellant
v.
3M Company; Arizant Healthcare, Inc.
Defendants - Appellees
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Appeal from United States District Court
for the District of Minnesota
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Submitted: March 16, 2021
Filed: August 5, 2021
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Before GRUENDER, KELLY, and GRASZ, Circuit Judges.
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GRUENDER, Circuit Judge.
Nancy Axline is a plaintiff whose case is part of the Bair Hugger multidistrict
litigation (“MDL”) against 3M Company and Arizant Healthcare, Inc. (collectively,
“3M”). See generally In re Bair Hugger Forced Air Warming Devices Prods. Liab.
Litig., MDL No. 15-2666 (JNE/DTS), 2019 WL 4394812 (D. Minn. July 31, 2019).
In her case, the district court 1 concluded that Ohio substantive law governed her
claims, found that she had failed to plead actionable claims under Ohio substantive
law, granted 3M judgment on the pleadings for this reason, denied her motion for
leave to amend her complaint to plead claims that would be actionable under Ohio
substantive law, and ultimately dismissed her case with prejudice. She appeals the
orders of the district court deciding that Ohio substantive law applies in her case and
denying her motion for leave to amend her complaint. We affirm.
I.
In December 2015, the Judicial Panel on Multidistrict Litigation centralized
the In re Bair Hugger Forced Air Warming Devices Products Liability Litigation in
the district court for coordinated pretrial proceedings. In April 2016, the district
court entered an MDL-wide order (“Direct Filing Order”) allowing plaintiffs joining
the MDL in the future to file their complaints directly in the district court, thereby
minimizing delays associated with the transfer of individual actions that would
otherwise be filed elsewhere. In the Direct Filing Order, the district court instructed
that, if a dispute over the applicable substantive law arose in a case that was directly
filed pursuant to the order, the district court generally would apply Minnesota
choice-of-law rules to resolve the dispute. That said, if the direct-filing plaintiff
identified in her complaint her current residence, the date and location of the surgery
in which she claims the Bair Hugger was used, and the appropriate venue where the
action otherwise would have been filed, the Direct Filing Order provided that the
choice-of-law rules of the appropriate venue identified in the complaint would apply.
In February 2017, Axline directly filed a complaint in the district court as part
of the MDL. She alleged that she was a resident and citizen of Ohio; that on April
21, 2009, the Bair Hugger was used during her hip surgery at a hospital in New
Albany, Ohio; and that the appropriate venue where she would have filed her
1
The Honorable Joan N. Ericksen, United States District Judge for the District
of Minnesota.
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complaint but for the Direct Filing Order was the United States District Court for the
Northern District of Ohio. Axline asserted fourteen state-law causes of action,
including negligence and design defect under Minnesota common law.
Subsequently, Axline filed a Lexecon waiver to allow the district court to try her
case.2
Thereafter, in another individual MDL action, the district court ruled that the
substantive law of those plaintiffs’ state of residence would govern their claims
rather than Minnesota law. This prompted Axline to attempt to retract her Lexecon
waiver, explaining that that choice-of-law ruling “resulted in a material difference
in the posture of [her] case.” The district court denied this attempted retraction
because, among other reasons, Axline mentioned “no grounds for reasonably
expecting a contrary choice-of-law ruling.”
Subsequently, 3M moved for judgment on the pleadings. As relevant here,
3M argued that, under Ohio choice-of-law rules applicable in Axline’s case, Ohio
substantive law governed her claims. 3M also argued that, under Ohio substantive
law, her common-law claims were not actionable because the Ohio Products
Liability Act (“OPLA”) had abrogated all common-law products-liability causes of
action. See Ohio Rev. Code § 2307.71(B).
Responding in opposition but seemingly overlooking the fact that her
allegations made Ohio choice-of-law rules apply in her case under the Direct Filing
Order, Axline asserted that Minnesota choice-of-law rules applied and that under
2
“Federal law limits an MDL court’s jurisdiction over a transferred case to
pretrial proceedings and provides that once those are completed, the MDL court
must remand the transferred case to the district from which it was transferred [for
trial proceedings]. Cases that are directly filed in an MDL court are treated as if they
were transferred from a judicial district sitting in the state where the case originated.
An MDL court can try a case where venue is improper if the parties waive their
objections. Such waivers are known as Lexecon waivers.” In re Depuy
Orthopaedics, Inc., 870 F.3d 345, 348 (5th Cir. 2017) (footnotes and internal
quotation marks omitted).
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those rules Minnesota substantive law governed her claims. Axline mentioned in
passing Ohio choice-of-law rules, but she made no argument that Minnesota
substantive law applied under those rules. Axline also requested that, if the district
court decided that Ohio substantive law governed her case, then she should be
granted leave to amend her complaint to plead the statutory causes of action under
the OPLA for negligent failure to warn and design defect. See Ohio Rev. Code
§§ 2307.75, 2307.76.
The district court granted 3M’s motion for judgment on the pleadings in
pertinent part. It explained that, pursuant to the Direct Filing Order and Axline’s
own allegations, Ohio choice-of-law rules applied. It then recognized that, under
Ohio choice-of-law rules, the substantive law of the place of the plaintiff’s injury
presumptively governs unless another jurisdiction has a “more significant
relationship” to the lawsuit. See, e.g., Morgan v. Biro Mfg. Co., 474 N.E.2d 286,
289 (Ohio 1984). The district court then stated that the parties had failed to “address
the ‘more significant relationship’ test,” explained that it was “unaware of any basis
for regarding Minnesota as the state with the ‘more significant relationship’” to the
lawsuit, and applied Ohio substantive law. Then, as relevant here, it found that
Axline’s common-law claims were not actionable because of the OPLA, so it
dismissed them. Finally, it denied Axline’s “informal request” for leave to amend
because she failed to comply with District of Minnesota Local Rule 15.1, which (as
the district court explained) requires a party seeking leave to amend to provide a
copy of the proposed amended pleading as well as a redlined version of it showing
how it differs from the operative pleading.
Subsequently, Axline formally moved for leave to amend her complaint in
order to assert claims under the OPLA. But in doing so she again failed to comply
with Local Rule 15.1 by not including a clean copy of the proposed amended
pleading. The motion came before a magistrate judge,3 who recommended denying
3
The Honorable David T. Schultz, United States Magistrate Judge for the
District of Minnesota.
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it. Axline objected to this recommendation, but the district court overruled her
objection and summarily denied her motion. The district court subsequently
dismissed her case with prejudice. Axline appeals, challenging the district court’s
choice-of-law ruling and its denial of her motion for leave to amend. 4
II.
We review de novo a district court’s choice-of-law determination. Chapman
v. Hiland Partners GP Holdings, LLC, 862 F.3d 1103, 1108 (8th Cir. 2017).
Applying Ohio choice-of-law rules, the district court concluded that Ohio
substantive law governed Axline’s case. On appeal, Axline acknowledges that Ohio
choice-of-law rules apply in her case. But now, for the first time, she argues that
Ohio choice-of-law rules dictate that Minnesota substantive law governs and that the
district court erred in concluding otherwise. Assuming that Axline has not forfeited
this argument, but see Wiser v. Wayne Farms, 411 F.3d 923, 926 (8th Cir. 2005), we
reject her contention on the merits.5
In an Ohio choice-of-law analysis, the threshold step is to determine whether
a relevant conflict actually exists between Ohio substantive law and the substantive
law of another jurisdiction. See Glidden Co. v. Lumbermens Mut. Cas. Co., 861
N.E.2d 109, 115 (Ohio 2006). It is undisputed here that a conflict exists between
Ohio and Minnesota substantive law that is relevant to Axline’s claims.
4
Axline does not challenge the district court’s dismissal of her common-law
claims on the basis that the OPLA abrogated them.
5
Although the district court did not analyze the factors under Ohio’s “more
significant relationship” test (because they were not argued), Axline asserts on
appeal that the “justifications” for applying Minnesota substantive law under those
factors are “part of the record.” Accordingly, we apply those factors here in light of
the undisputed facts in the record. See Smoky Hills Wind Project II, LLC v. City of
Independence, 889 F.3d 461, 468 (8th Cir. 2018) (“We may affirm the judgment of
the district court on any basis disclosed in the record, whether or not the district court
agreed with or even addressed that ground.” (internal quotation marks omitted)).
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Given that a conflict exists, the next step under Ohio choice-of-law rules is to
follow the approach laid out in sections 6, 145, and 146 of the Restatement (Second)
of Conflict of Laws (Am. L. Inst. 1971) for tort cases such as this. See Morgan, 474
N.E.2d at 288-89. Under section 146, there is a starting presumption that “the law
of the place of the injury controls.” See id. at 289. In this case, that is Ohio. This
presumption then may be rebutted by a showing that “another jurisdiction has a more
significant relationship to the lawsuit.” Id. To determine whether this is so, the court
must consider the factors in section 145, which are (1) the place of the injury; (2) the
place where the conduct causing the injury occurred; (3) the domicile, residence,
nationality, place of incorporation, and place of business of the parties; (4) the place
where the relationship between the parties, if any, is located; and (5) any factors
under section 6 that the court finds relevant. Id. In turn, the factors under section 6
are (1) the needs of the interstate and international systems; (2) the relevant policies
of the forum; (3) the relevant policies of other interested states and the relative
interests of those states in the determination of the particular issue; (4) the protection
of justified expectations; (5) the basic policies underlying the particular field of law;
(6) certainty, predictability, and uniformity of result; and (7) ease in the
determination and application of the law to be applied. Id. at 289 n.6.
Thus, there are as many as eleven factors that may be considered in an Ohio
choice-of-law analysis. Considering these factors here, we conclude that the district
court did not err in deciding that Ohio substantive law governed this case.
The first factor under section 145 is the place of the injury. Id. at 289. Here,
that place is Ohio. This factor thus favors applying Ohio substantive law.
The second factor under section 145 is the place where the conduct causing
the injury occurred. Although Axline concedes that “[a]spects” of this factor
“support a connection to each state,” she argues that more of these aspects favor
applying Minnesota substantive law rather than Ohio substantive law and thus that
this factor on the whole favors applying Minnesota substantive law. Even assuming
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Axline is right about this factor, that has only a marginal effect on our analysis. In
cases where the underlying personal injury occurs in one state but the conduct
causing that injury occurs in another, the “law of the state of injury will usually be
applied to determine most issues involving the tort,” particularly “when the injured
person has a settled relationship” to the state of injury, such as by being a resident
or citizen of that state. Restatement (Second) of Conflict of Laws § 146 cmt. e; see
also In re E.I. du Pont de Nemours & Co. C-8 Pers. Inj. Litig., 316 F. Supp. 3d 1021,
1025, 1030, 1033-35 (S.D. Ohio 2015) (applying this “guidance” from section 146
comment e to conclude that Ohio substantive law governed under Ohio choice-of-
law rules in personal-injury and wrongful-death suits where the place of injury was
Ohio but the conduct causing the injury occurred elsewhere). Axline was injured in
Ohio, and she is both a resident and citizen of Ohio. Accordingly, even if this factor
favors applying Minnesota substantive law, in the circumstances here it carries little
weight.
The third factor under section 145 is the domicile, residence, nationality, place
of incorporation, and place of business of the parties. Axline’s domicile and
residence is Ohio. 3M Company is, and Arizant Healthcare was (until it was
dissolved in December 2014), incorporated in Delaware. 3M Company has, and
Arizant Healthcare had, its principal place of business in Minnesota. As this factor
implicates both Ohio and Minnesota, it is neutral. Cf. Restatement (Second) of
Conflict of Laws § 145 cmt. e (noting that in the tort context “[t]he fact . . . that one
of the parties is domiciled or does business in a given state will usually carry little
weight of itself”).
The fourth factor under section 145 is the place where the relationship, if any,
between the two parties is centered. The parties agree that this factor is “not
influential” in this case, so it is either neutral or irrelevant.
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Moving on to the section 6 factors, we first consider the needs of the interstate
system. To the extent Axline makes any argument about this factor, 6 she concedes
that “both states have an interest in the manufacture and sale of safe products” and
that “[n]either state’s interests are impaired or frustrated by application of one
[state’s] law or the other.” This factor is thus, at best for her, either neutral or
irrelevant.
Under section 6, we next consider the relevant policies of the forum. Axline
does not identify any rules specific to section 6 for ascertaining where the “forum”
is, and we are unaware of any, so we presume that the “forum” for section 6 purposes
is the “forum” dictated by other applicable legal principles. Axline assumes that
Minnesota is the forum because that is where the district court is located, and she
argues that relevant Minnesota policies favor applying Minnesota substantive law.
But Axline’s assumption is mistaken. “Special rules apply in MDL cases as to
determining the forum state.” In re Volkswagen & Audi Warranty Extension Litig.,
692 F.3d 4, 17 (1st Cir. 2012). “In MDL cases, the forum state is typically the state
in which the action was initially filed before being transferred to the MDL court.”
In re Welding Fume Prods. Liab. Litig., 245 F.R.D. 279, 295 n.90 (N.D. Ohio 2007).
Granted, Axline filed her complaint directly in the district court, but this was only
because of the Direct Filing Order; otherwise, she would have filed her complaint in
the Northern District of Ohio, in which case the forum state would have been Ohio.
The direct-filing mechanism in MDL litigation is for “bureaucratic convenience”
and does not render the state of the MDL court the “forum” in direct-filed actions
that would have been brought in another forum but for the direct-filing mechanism.
See Petitta v. 3M Co., 999 F.3d 534, 538-39 (8th Cir. 2021). Instead, the forum
remains the state where the action would have been brought. See id. As Axline
alleged in her complaint, that state is Ohio. We thus consider Ohio the forum for
purposes of this factor and consider its relevant policies.
6
Axline did not actually discuss in her briefs how the section 6 factors apply
under Ohio choice-of-law rules. Instead, she reverted to arguing Minnesota choice-
of-law rules that do not correspond directly to the section 6 factors. We nevertheless
credit Axline’s contentions to the extent that they track the section 6 factors.
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Ohio has abrogated most of the claims Axline attempted to pursue in this case,
see Ohio Rev. Code § 2307.71(B), and partially replaced them with specific
statutory causes of action, see, e.g., id. §§ 2307.75, 2307.76. Declining to apply
Ohio substantive law here would allow Axline to make an end run around Ohio’s
relevant policies. This factor thus favors applying Ohio substantive law. Cf. Allison
v. ITE Imperial Corp., 928 F.2d 137, 139, 143-44 (5th Cir. 1991) (applying the
section 6 factors under Mississippi choice-of-law rules and concluding in light of
those factors that Tennessee substantive law applied, largely because a Tennessee
statute of repose evinced its “strong interest in limiting a manufacturer’s exposure”
and applying that law would “promote[] important state policies”).
The next factor we consider under section 6 is the relevant policies of other
interested states and the relative interests of those states in the determination of the
particular issue. Axline argues that Minnesota has “strong interests” in the policing
of tortious behavior that takes place in Minnesota and in the full compensation of
tort victims. Ohio courts recognize that a state in which a manufacturer is
incorporated and develops an injury-causing product has an “important policy
objective” in seeing its law applied to deter bad acts by those manufacturers. See
White v. Crown Equip. Corp., 827 N.E.2d 859, 863 (Ohio Ct. App. 2005). But Ohio
courts also recognize that the relative interests of the state where the plaintiff resides
and is injured may trump such considerations. See id. Thus, even if Minnesota’s
interest in ensuring full compensation for tort victims is not trumped by other
considerations, this factor is, at best for Axline, mixed.
Next under section 6, we consider the protection of justified expectations. To
the extent Axline expected Minnesota substantive law to apply in her case, we fail
to see how that expectation was justified. Under the Direct Filing Order, the
allegations in Axline’s complaint dictated that Ohio choice-of-law rules would apply
to resolve any dispute about the applicable substantive law in her case. And, if
anything, the “presumption” of applying the law of the place of injury under Ohio
choice-of-law rules should have led Axline to expect that Ohio substantive law
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would govern her case. Morgan, 474 N.E.2d at 288-89. This factor thus favors
applying Ohio substantive law.
Under section 6, we next consider the basic policies underlying the particular
field of law. Axline does not identify what these basic policies are or why they favor
applying Minnesota substantive law. Accordingly, we deem this factor to be, at best
for her, either neutral or irrelevant.
The next factor we consider under section 6 is certainty, predictability, and
uniformity of result. Axline argues that “a ‘predictable result’ is achieved by
applying Minnesota [substantive] law because a federal court sitting in diversity
usually applies the substantive law of the forum state.” The legal proposition she
recites is true but cuts against her. As discussed above, the “forum state” here is
Ohio. Thus, a predictable result is achieved if Ohio substantive law applies in this
case. See also Restatement (Second) of Conflict of Laws § 146 cmt. c (noting that
the most predictable result occurs when the law of the state where the injury occurred
is applied). This factor, then, favors applying Ohio substantive law.
Finally, under section 6 we consider ease in the determination and application
of the law to be applied. Given the “presumption” applicable here of applying Ohio
substantive law, see Morgan, 474 N.E.2d at 288-89, and Axline’s seeming
concession that Ohio substantive law “could be applied without difficulty” in this
case, this factor favors applying Ohio substantive law.
In sum, Axline has not rebutted the presumption that the substantive law of
Ohio, the state where she was injured, governs this case. See id. at 289 (applying
the law of the place of injury, Kentucky, after applying Ohio choice-of-law rules,
even though two factors favored applying Ohio substantive law). Accordingly, the
district court correctly concluded that Ohio substantive law governed this action
under Ohio choice-of-law rules.
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III.
Axline also argues that the district court abused its discretion in denying her
motion for leave to amend her complaint, brought under Federal Rule of Civil
Procedure 15(a)(2), so that she could assert claims under the OPLA for negligent
failure to warn and design defect. We review the denial of a motion for leave to
amend for an abuse of discretion. In re Target Corp. Sec. Litig., 955 F.3d 738, 744
(8th Cir. 2020). We may affirm the denial of a motion for leave to amend “on any
ground supported by the record.” Id. at 745.
The magistrate judge who heard argument on Axline’s motion concluded that
Axline’s motion should be denied. In doing so, he identified a number of reasons
that may justify denying leave to amend under Rule 15, including that in moving for
leave to amend Axline again had failed to comply with Local Rule 15.1, see O’Neil
v. Simplicity, Inc., 574 F.3d 501, 505 (8th Cir. 2009), that Axline unduly delayed in
seeking leave to amend, see Nuevos Destinos, LLC v. Peck, 999 F.3d 641, 645 n.4
(8th Cir. 2021), and that amendment would have been futile, see id. 7 Adopting the
magistrate judge’s recommendation, the district court summarily denied Axline’s
motion.
We find no abuse of discretion in this denial. “Although leave to amend shall
be freely given when justice so requires, see Fed. R. Civ. P. 15(a), plaintiffs do not
have an absolute or automatic right to amend.” O’Neil, 574 F.3d at 505. “A district
court does not abuse its discretion in denying leave to amend where a plaintiff has
not followed applicable procedural rules.” Id. Axline twice failed to comply with
7
Although concluding that leave to amend should be denied under Rule 15,
the magistrate judge primarily concluded that Rule 16 rather than Rule 15 governed
this motion because a scheduling order was in place ostensibly governing Axline’s
ability to amend, and he found that Axline had not met Rule 16(b)(4)’s good-cause
standard for modifying the scheduling order. 3M raises the Rule 16 ruling on appeal
as an alternative ground to affirm. We do not reach this issue because we affirm the
denial under Rule 15.
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Local Rule 15.1, including after the district court explicitly informed her of the local
rule’s requirements. Her failures in this regard provided sufficient grounds for the
district court to deny her motion for leave to amend. See id.; Nuevos Destinos, 999
F.3d at 645 n.4; In re Baycol Prods. Litig., 732 F.3d 869, 880 n.8 (8th Cir. 2013).
Axline acknowledges that failure to comply with local rules “can be a basis to
deny leave to amend,” but she suggests that this is not a sufficient basis here because
she lacked “notice and opportunity to comply.” Not so. Setting aside the fact that
it was her counsel’s “responsibility to know the local rules” of the district court, see
Harris v. Steelwald Equip. Co., 869 F.2d 396, 400 (8th Cir. 1989), the district court
explicitly informed her of what that rule required before she filed her formal motion.
The district court was within its discretion to deny her motion for leave to amend
when thereafter she still failed to follow the rule.
IV.
For the foregoing reasons, we affirm the district court’s orders determining
that Ohio substantive law applied and denying Axline’s motion for leave to amend.8
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8
We deny as moot 3M’s pending motion to strike. See, e.g., Cooper Tire &
Rubber Co. v. Nat’l Labor Rels. Bd., 866 F.3d 885, 892 n.2 (8th Cir. 2017).
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