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February 06, 2017 - Drug & Medical Device, Product Liability

Plaintiffs’ Fraudulent Joinder Tactic Results in Dismissal

U.S. Supreme Court’s Decision to Review a Pair of FTCA Cases Could Spell a Sea Change in FTC’s Enforcement Authority

Defendants successfully argued “fraudulent joinder” in Bahalim v. Ferring Pharmaceuticals, Inc., winning dismissal of the case in its entirety.[1]  The case was decided on Plaintiffs’ motion to remand and Defendants’ motions to dismiss after Defendant Ferring Pharmaceuticals removed the suit to federal court based on diversity jurisdiction.  The court rejected Plaintiffs’ argument that the forum defendant rule applied and ultimately dismissed the case.


Ferring manufactures and distributes Bravelle, a drug designed to treat infertility in women.  Plaintiffs, who were citizens of Texas and Utah, sued Ferring and Stericycle in Illinois state court.  They alleged that Ferring recalled multiple lots of the drug that did not meet potency specifications and that Stericycle administered the recall.  Plaintiffs further alleged that they consumed Bravelle from the recalled lots and asserted claims based on negligence, strict liability, product liability, and express and implied warranties.

Ferring removed the case to federal court based on complete diversity of citizenship.  Plaintiffs argued in a motion to remand that removal was improper under the forum defendant rule, which prohibits removal premised on diversity in cases where at least one defendant is a citizen of the forum state.  Although Stericycle was a citizen of the forum state Illinois, Ferring argued Plaintiffs had fraudulently joined Stericycle, and therefore removal was proper.

Fraudulent Joinder Doctrine

To establish fraudulent joinder, a defendant must prove that the plaintiff cannot establish a cause of action against the forum state defendant after resolving all issues of fact and law in favor of the plaintiff.  The court considered the policy interests articulated in Morris v. Nuzzo, a Seventh Circuit opinion that considered fraudulent joinder in the context of the forum defendant rule.[2]

The court concluded that:  a plaintiff’s interest in selecting the forum is less compelling when he or she joins a non-diverse defendant; improperly joining a forum defendant lessens the weight provided to a plaintiff’s choice of forum; and neither plaintiff here was an Illinois citizen, thus weakening the court’s deference to plaintiffs’ choice of forum.  Furthermore, the forum defendant rule only applies where a resident defendant is properly joined and served—but a fraudulently joined forum defendant is not a properly joined defendant.  Therefore, the court concluded that the interest in confining federal jurisdiction to its appropriate statutory limits weighed in favor of Defendants.

Finally, the court determined that Plaintiffs could not maintain a failure to warn or negligence claim against Stericycle, and had improperly joined Stericycle for the sole purpose of avoiding removal to federal court.  In support of its conclusion, the court noted that Stericycle did not manufacture, promote, distribute, or sell Bravelle.  Therefore, Plaintiffs could not bring a product liability failure to warn claim against Stericycle under the applicable state laws.  Plaintiffs’ negligence claims against Stericycle were similarly without merit.


Having concluded that the fraudulent joinder doctrine applied and that Plaintiffs’ claims against Stericycle had no chance of success, the court granted Stericycle’s motion to dismiss.  The court also granted Ferring’s motion to dismiss for lack of personal jurisdiction, holding that Ferring did not have sufficient minimum contacts in Illinois to establish specific jurisdiction.

The fraudulent joinder doctrine is not commonly raised and may often be overlooked as a litigation tool for defendants.  Although applicable only in specific circumstances, Bahalim proves that it is worth asserting in appropriate cases.

[1] Bahalim v. Ferring Pharmaceuticals, Inc., Case No. 16 C 8335, 2017 WL 118418 (N.D. Ill. Jan. 12, 2017).

[2] Morris v. Nuzzo, 718 F.3d 660 (7th Cir. 2013).