Pool v. F. Hoffman-La Roche, Ltd.
386 F. Supp. 3d 1202
N.D. Cal.2019Background
- Plaintiff Markell Pool (California citizen, ex-military) alleges neurological and psychiatric injuries from taking Lariam, a drug manufactured/marketed by Roche entities and later tied to Genentech by successor-liability theory.
- Defendants: F. Hoffmann‑La Roche Ltd. (FHLR, Swiss); Hoffman‑La Roche, Inc. (HLR); Roche Laboratories, Inc. (Roche Labs); Genentech, Inc.; Genentech USA (Genentech Defendants). Four defendants (all but FHLR) removed the state action to federal court asserting diversity jurisdiction.
- Removing Defendants argued the Genentech Defendants were fraudulently joined (so their California citizenship could be ignored) and that HLR/Roche Labs’ principal place of business (nerve center) is Little Falls, New Jersey, not South San Francisco, California.
- Plaintiff moved to remand. Removal notice omitted Roche Labs’ citizenship initially but was amended; the Court held the defect was curable under 28 U.S.C. § 1653.
- On the merits, the Court found (1) defendants failed to meet the heavy burden to show the Genentech Defendants were fraudulently joined given plausible successor‑liability allegations and supporting evidence, and (2) defendants failed to prove HLR and Roche Labs’ nerve centers are in New Jersey. The case was remanded to state court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether removal was procedurally defective due to missing citizenship statement for Roche Labs | Kanter and §1653 allow curing defective jurisdictional allegations; amended notice cures defect | Amended notice filed after 30‑day removal period so cannot cure | Defect curable under §1653; amendment permitted; removal notice not procedurally defective |
| Whether Genentech Defendants were fraudulently joined | Genentech is alleged to be the "mere continuation"/successor of Roche’s military‑Lariam line (no consideration, common ownership/officers); thus plausible successor liability | Genentech never sold Lariam and successor liability cannot apply where predecessor still exists; joinder is fraudulent | Joinder not fraudulent — plausible state‑law successor/mere‑continuation claim exists; heavy burden on removers not met; citizenship cannot be ignored |
| Whether HLR and Roche Labs’ principal place of business (nerve center) is New Jersey | Plaintiff: executive/operational functions shifted to South San Francisco after Roche’s acquisition of Genentech; public materials and filings support California nerve center | Defendants: corporate filings list New Jersey as principal place of business; officers based in New Jersey | Removers failed to prove New Jersey nerve center; competing evidence creates doubt and must be resolved in favor of remand |
| Entitlement to attorney's fees under 28 U.S.C. § 1447(c) | Fees requested for cost of removal/remand | Removal was reasonable; not frivolous | Denied — removal was not objectively unreasonable or frivolous |
Key Cases Cited
- Hunter v. Philip Morris USA, 582 F.3d 1039 (9th Cir.) (fraudulent joinder standard and heavy burden on removing party)
- GranCare, LLC v. Thrower, 889 F.3d 543 (9th Cir.) (fraudulent‑joinder analysis distinct from Rule 12(b)(6); remand if any possibility state court could find claim)
- Ritchey v. Upjohn Drug Co., 139 F.3d 1313 (9th Cir.) (fraudulent joinder when plaintiff cannot possibly prevail on claims)
- Hamilton Materials, Inc. v. Dow Chem. Corp., 494 F.3d 1203 (9th Cir.) (fraudulent joinder requires clear and convincing proof)
- Hertz Corp. v. Friend, 559 U.S. 77 (U.S.) (principal place of business = corporation's "nerve center")
- Cleveland v. Johnson, 209 Cal. App. 4th 1315 (Cal. Ct. App.) (successor liability; mere‑continuation theory and equitable successor liability applied to line‑of‑business transfers)