On November 18, 2014, in Corber v. Xanodyne Pharmaceuticals, Inc., the en banc US Court of Appeals for the Ninth Circuit, held that, under the totality of the circumstances, a petition to coordinate actions under Section 404 of California Code of Civil Procedure constitutes a proposal for the actions to be tried jointly and renders those actions a removable "mass action" subject to federal jurisdiction under the Class Action Fairness Act (CAFA) (No. 13-56306, (9th Cir. Nov. 18, 2014)).

The Corber plaintiffs claimed that they suffered injuries related to the ingestion of propoxyphene, an ingredient found in certain pain medications manufactured by Xanodyne Pharmaceuticals, Inc., Teva Pharmaceuticals, Inc. and other pharmaceutical producers. In November 2010, drugs containing propoxyphene were taken off the market because of the Food and Drug Administration's safety concerns. More than 40 actions have been filed in California state courts regarding propoxyphene.

The plaintiffs' attorneys filed a petition under Section 404 of the California Code of Civil Procedure to establish a coordinated proceeding for all California propoxyphene actions. The coordinated proceeding was intended “for all purposes” and to avoid potential inconsistent judgments or conflicting determinations of liability. After the plaintiffs filed their petition for coordination, defendants removed the case to federal district court under CAFA's mass action provision, which provides federal district courts with jurisdiction over civil actions in which monetary relief claims of 100 or more persons are proposed to be tried jointly.

The district court remanded the case to state court, finding that there was no federal jurisdiction under CAFA because the plaintiffs' petition for coordination did not constitute a proposal to try the cases jointly. The defendants appealed.

On September 24, 2013, a three-judge panel of the Ninth Circuit issued an opinion affirming the district court’s decision. The panel found that the memorandum submitted by the plaintiffs in support of the petition for coordination clearly focused on pretrial matters, and concluded that the plaintiffs' petition for coordination "stopped far short of proposing a joint trial." The court distinguished its holding from the Seventh Circuit's opinion in In re Abbott Laboratories, Inc., 698 F.3d 568, 573 (7th Cir. 2012). In Abbott, the court held that a petition for consolidation “through trial” was a proposal to try the actions jointly and explicitly requested consolidation of the cases through trial and not solely for pretrial proceedings.

Circuit Judge Gould dissented, arguing that the majority misinterpreted CAFA and created a circuit split with the Seventh Circuit. Judge Gould criticized the majority for down-playing language in the plaintiffs' memorandum in support of their petition for coordination that claimed that coordination was necessary to avoid inconsistent judgments.

On February 10, 2014, the Ninth Circuit ordered that the case be reheard en banc and that the underlying decision not be cited as precedent by or to any court of the Ninth Circuit.

The Ninth Circuit reversed. The en banc court held that plaintiffs’ petitions to coordinate actions under Section 404 constituted proposals for these actions to be tried jointly, making the actions a “mass action” pursuant to CAFA and subject to removal to federal jurisdiction. Specifically, the Ninth Circuit interpreted the plaintiffs’ petition to coordinate the actions “for all purposes” to constitute request for joint trial because “[a]ll purposes must include the purposes of trial.” The court also found that the specific reasons given for coordination, including the danger of inconsistent judgments and conflicting determinations of liability, supported the conclusion that a joint trial was requested.

Plaintiff’s counsel, especially in the Ninth Circuit, should exercise extra care when filing petitions to coordinate actions under Section 404 in California or comparable procedural rules in other states. To mitigate the danger of removal to federal jurisdiction under CAFA, plaintiffs should consider qualifying their coordination petition as only intended for "pre-trial purposes." On the other hand, defense counsel should scrutinize plaintiffs’ petitions for coordination to determine whether they can be interpreted as requesting a joint trial under Corber, which would render them subject to removal to federal jurisdiction under CAFA.