We recently became aware of a legal podcast comment about the incompatibility of medical monitoring claims and the availability of equitable relief (at least in federal court) under Grupo Mexicano de Desarrollo S.A. v. Alliance Bond Fund, Inc., 527 U.S. 308 (1999).
Whodawhat?
That was our initial reaction. But we took a look anyway, and it looks like there is something to it. Grupo Mexicano has nothing whatever to do with prescription medical product liability litigation, or even product liability generally. It was a creditors rights case. For our purposes, the key holding concerns the inherent limitations of “equitable” relief in federal court. The creditor plaintiff could not obtain equitable relief − an injunction against alienation of assets prior to any merits adjudication − because of the historical limitation on the federal courts’ equitable powers. Those powers are limited to what existed in English courts of equity in 1789:
The Judiciary Act of 1789 conferred on the federal courts jurisdiction over “all suits . . . in equity.” We have long held that the jurisdiction thus conferred is an authority to administer in equity suits the principles of the system of judicial remedies which had been devised and was being administered by the English Court of Chancery at the time of the separation of the two countries. Substantially, then, the equity jurisdiction of the federal courts is the jurisdiction in equity exercised . . . in England at the time of the adoption of the Constitution and the enactment of the original Judiciary Act. The substantive prerequisites for obtaining an equitable remedy as well as the general availability of injunctive relief are not altered by [the federal rules of civil procedure] and depend on traditional principles of equity jurisdiction.
Grupo Mexicano, 527 U.S. at 318-19 (citations and quotation marks omitted) (emphasis added). “Long been the law“ is right. Under the Judiciary Act, “courts which are created by written law, and whose jurisdiction is defined by written law, cannot transcend that jurisdiction.” Ex parte Bollman, 8 U.S. (4 Cranch) 75, 93 (1807) (construing that Act).
Obviously, for Grupo Mexicano to be relevant at all to medical monitoring litigation, such recoveries – by otherwise completely uninjured persons – would have to be considered “equitable” relief subject to the original 1789 grant of equitable powers to the federal courts. So we looked at that.
It is immediately apparent that many, probably most, courts view “medical monitoring” awards to persons who have suffered no present injury as “equitable” in nature. Indeed, Friends for All Children, Inc. v. Lockheed Aircraft Corp., 746 F.2d 816 (D.C. Cir. 1984), generally considered the first decision ever to recognize the recoverability of medical monitoring costs divorced from any present physical injury, solely invoked “equity” to justify its novel result. Id. at 829-31 (e.g., “plaintiffs must show that they meet the traditional standards governing the award of equitable relief”). Other decisions permitting non-injury medical monitoring claims do the same, particularly when recoveries are to be administered as court-supervised funds. E.g., Exxon Mobil Corp. v. Albright, 71 A.3d 30, 80 (Md. 2013) (“many courts that award medical monitoring costs to do so by establishing equitably a court-supervised fund”); Hansen v. Mountain Fuel Supply Co., 858 P.2d 970, 982 (Utah 1993) (“Although trial courts have ample equitable powers to assure that this remedy is provided, we suggest consideration of a court-supervised fund”); Ayers v. Jackson Twp., 525 A.2d 287, 314 (N.J. 1987) (“a highly appropriate exercise of the Court’s equitable powers”); Petito v. A.H. Robins Co., 750 So.2d 103, 106 (Fla. App. 1999) (“the implementation of and supervision over a medical monitoring fund is well within a court’s equitable powers”); Burns v. Jaquays Min. Corp., 752 P.2d 28, 33 (Ariz. App. 1987) (following Ayers); Donovan v. Philip Morris USA, Inc., 2012 WL 957633, at *15-16 (D. Mass. March 21, 2012) (“the surest way for the Court . . . is to fashion relief through an injunction rather than a money damages award”).
We could go on, but the point is made. Indeed, we often see plaintiffs urging that medical monitoring be treated as an equitable remedy when they seek class certification under Fed. R. Civ. P. 23(b)(2) – to avoid the predominance of common questions requirement – and some courts have been receptive. See, Barnes v. American Tobacco Co., 161 F.3d 127, 142–43 (3d Cir. 1998) (court-ordered medical-monitoring programs could be characterized as final injunctive relief; denying (b)(2) certification on other grounds); Boughton v. Cotter Corp., 65 F.3d 823, 827 (10th Cir. 1995) (Rule 23(b)(2) certification for a medical-monitoring claim may be legally permissible; class lacked cohesion); In re Valsartan, Losartan, & Irbesartan Products Liability Litigation, 2023 WL 1818922, at *33-34 (D.N.J. Feb. 8, 2023) (actually certifying an equitable Rule 23(b)(2) medical monitoring class action).
At minimum, medical monitoring is a creature of equity in many jurisdictions. In federal court – either on the basis of traditional diversity jurisdiction, or under CAFA – the recoverability of “medical monitoring” relief thus would seem to depend on whether English courts of equity back in 1789 allowed otherwise uninjured persons to recover for mere increased risk of future injury due to a defendant’s negligence.
We seriously doubt that any such 200+-year-old English precedent exists. But we’re not going to do the other side’s research for them. Instead, assuming that Grupo Mexicano would bar equitable relief, we will examine whether diversity jurisdiction provides an out. Grupo Mexicano flagged, but did not address, that issue:
Although this is a diversity case, respondents’ complaint sought the injunction pursuant to Rule 65. . . . Petitioners argue for the first time before this Court that . . . availability of this injunction under Rule 65 should be determined by the law of the forum State. . . . Because this argument was neither raised nor considered below, we decline to consider it.
527 U.S. at 318 n.3 (Erie citation omitted).
We note that, for an Erie-based argument to have any traction, the equitable powers of the relevant non-federal jurisdiction would have to be considerably broader than those conferred on the federal courts by the Judiciary Act. That may be the case, or it may not. We note that Pennsylvania, a state that allows no-injury medical monitoring, has a statute similar to the 1789 federal Judiciary Act – only reaching even further back in time. Pennsylvania has adopted the “common law and such of the statutes of England as were in force in the Province of Pennsylvania on May 14, 1776.” 1 Pa. Cons. Stat. §1503(a). See Novatek Corp. v. Mallet, 324 F. Supp.3d 560, 568 (E.D. Pa. 2018) (§1503(a) precludes any Erie-based avoidance of Grupo Mexicano under Pennsylvania law). Other states, particularly the original 13, may have similar statutes.
But even if a state court’s equitable powers are broader than a federal court’s under Grupo Mexicano, it is doubtful (albeit not conclusively determined) that plaintiffs could push an “equitable” medical monitoring claim past the Supreme Court’s Grupo Mexicano holding based on Erie principles. “State law cannot define the remedies which a federal court must give simply because a federal court in diversity jurisdiction is available as an alternative tribunal to the State’s courts.” Guaranty Trust Co. v. York, 326 U.S. 99, 106 (1945). “Congress provided that the forms and modes of proceeding in suits of equity would conform to the settled uses of courts of equity.” Id. at 104-05 (citation and quotation marks omitted). Thus,
This does not mean that whatever equitable remedy is available in a State court must be available in a diversity suit in a federal court, or conversely, that a federal court may not afford an equitable remedy not available in a State court. Equitable relief in a federal court is of course subject to restrictions: the suit must be within the traditional scope of equity as historically evolved in the English Court of Chancery. . . . That a State may authorize its courts to give equitable relief unhampered by any or all such restrictions cannot remove these fetters from the federal courts.
Id. at 105-06 (citations omitted). That’s the Supreme Court speaking in a post-Erie decision.
Guaranty Trust means that, “since Erie, the Supreme Court has instructed that a federal court’s equitable authority remains cabined to the traditional powers exercised by English courts of equity, even for claims arising under state law.” Sonner v. Premier Nutrition Corp., 971 F.3d 834, 840 (9th Cir. 2020) (citing Guaranty Trust). The Supreme Court “has never held or suggested that state law can expand a federal court’s equitable powers, even if allowing such expansion would ensure a similar outcome between state and federal tribunals.” Id. at 841-42. Accord Rodgers-Rouzier v. American Queen Steamboat Operating Co., LLC, 104 F.4th 978, 987 (7th Cir. 2024) (“equitable remedies available in federal court for the violation of state substantive rights might continue to depend on federal law, even after Erie” and “are, in turn, based on” what was permitted in ‘the English Court of Chancery at the time of the separation of the two countries’”) (quoting Grupo Mexicano); Fidelity & Deposit Co. v. Edward E. Gillen Co., 926 F.3d 318, 326 (7th Cir. 2019) (“federal courts’ equitable powers are limited, not by state law, but to the traditional powers exercised by English courts of equity, even in diversity cases”); Davilla v. Enable Midstream Partners, 913 F.3d 959, 973 (10th Cir. 2019) (“the practice of borrowing state rules of decision does not apply with equal force to determining appropriate remedies, especially equitable remedies”).
There are lots more cases in the trial courts, but we believe that the above establishes that an argument that no-injury medical monitoring is simply not an available “equitable“ remedy in federal court under Grupo Mexicano regardless of what state law might allow (barring some weird ancient English precedent that we have no reason believe exists). It would also bar even weirder “equitable” demands, like medical research funds or corrective advertising, that plaintiffs have occasionally demanded.
We caution that this argument seems never to have been tried before in the medical monitoring context. We searched for any opinion in any court citing to either Grupo Mexicano or Guaranty Trust that also included the phrase “medical monitoring” and came up empty. So the argument hasn’t been rejected, either.
So we say go for it − but pick your spots and make your arguments carefully and fully. If you’re going to try it, don’t do it in a half-assed fashion, and save it for a judge who might be receptive. Plaintiffs try new liability theories all the time; it behooves those of us on the defense side to be equally creative.
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