Purdue Pharma L.P. v. State of Mississippi
Purdue Pharma L.P. v. State of Mississippi
Opinion
¶ 1. In this interlocutory appeal, the Court must determine whether the location of a foreign corporation's registered agent is relevant when determining the appropriate venue for an action. We find that the adoption of the Registered Agents Act ("RAA") made the location of a corporation's registered agent irrelevant for purposes of venue.
FACTS AND PROCEDURAL HISTORY
¶ 2. On December 15, 2015, the State of Mississippi filed a complaint in the Hinds County Chancery Court against fifteen pharmaceutical manufacturers and their affiliates ("Defendants"). According to the complaint, opioids originally were designed to treat "short-term post-surgical and trauma-related pain, and for palliative (end-of-life) care." However, in an effort to increase profits, the State alleged that Defendants employed a wide variety of deceptive and misleading practices designed to enter and conquer the chronic-pain market. The State alleged that Defendants, despite knowledge of the addictive nature of opioids, engaged in a marketing campaign "to create a profound transformation in medical and public perception that would permit the use of opioids not only for acute and palliative care, but also for long periods of time to treat more common aches and pains, like lower back pain, arthritis, and headaches."
¶ 3. As a result, opioids moved from a niche category of drugs to the most prescribed class of drugs in America. The State averred that, in an opioid study, two-thirds of patients who consumed opioids for more than ninety days still were taking opioids approximately five years later. 1 The State also alleged that in 2012, prescription opioid use contributed to 16,007 deaths nationally. Specific to Mississippi, in 2012, ninety percent of drug-overdose deaths were caused by prescription drugs; most of the deaths were accidental. The complaint stated,
Defendants' deceptive marketing campaign deprived Mississippi patients and their doctors of the ability to make informed medical decisions and, instead, caused important, sometimes life-or-death decisions to be made based not on science, but on hype. Defendants deprived patients, their doctors, and health care payers of the chance to exercise informed judgment and subjected them to enormous costs and suffering.
¶ 4. The State alleged four common-law claims (fraud, negligent misrepresentation, unjust enrichment, and public nuisance), and a claim pursuant to the Mississippi Consumer Protection Act ("MCPA"), Mississippi Code Section 75-24-9. The complaint stated that the Hinds County Chancery Court "has subject matter jurisdiction over this action pursuant to MISS. CODE ANN. § 75-24-9, because the State brings this action, in part, to restrain by permanent injunction the use of a method, act, or practice prohibited by MISS. CODE ANN. § 75-24-5." In addition, the complaint stated that venue was proper pursuant to Mississippi Code Sections 11-11-3, 11-5-1, 75-24-9, and 9-5-81 ; and Article 6, Section 159, of the Mississippi Constitution. 2
¶ 5. The parties do not dispute that each defendant's principal place of business was located outside the State of Mississippi. On March 3, 2016, Defendants filed a joint motion to transfer for improper venue and to dismiss the complaint for failure to state a claim. Defendants moved the trial court to transfer the action from the Hinds County Chancery Court to the Rankin County Chancery Court pursuant to Mississippi Rules of Civil Procedure 12(b)(3) and 82(d). 3 Attached to the motion was the affidavit of Stephanie M. Rippee, attorney of record for Defendants. Although each of Defendants' principal places of business were located outside the State of Mississippi, Rippee stated that, according to the Mississippi Secretary of State's website, Actavis Pharma had appointed as its registered agent in Mississippi CT Corporation System, which was located at 645 Lakeland East Drive, Suite 101, Flowood, Rankin County. In addition, Cephalon, Inc., had appointed as its registered agent Corporate Creations Network, Inc., located at 232 Market Street, Flowood, Rankin County. 4
¶ 6. The State argued in opposition that the Mississippi Legislature passed the RAA to eliminate the relevance of registered agents to the question of venue. The trial court agreed, finding that the passage of the RAA made the location of a foreign corporation's registered agent irrelevant to venue analysis. Accordingly, the trial court held that, because Mississippi's general chancery-court venue statute, Mississippi Code Section 11-5-1, stated that all cases not specifically provided for may be brought in the county in which the defendant may reside or be found, and because no defendant resided or could be found in Mississippi, Section 11-5-1 also was inapplicable to the action.
¶ 7. The trial court continued that Mississippi's general venue statute, Mississippi Code Section 11-11-3, was the only state venue statute that identified criteria other than the location of a registered agent. Pursuant to Section 11-11-3, "a civil action against a nonresident may be commenced in the county where the plaintiff resides or is domiciled."
¶ 8. Defendants now appeal and argue that the trial court erred in finding that Hinds County was the appropriate venue for this action.
ANALYSIS
¶ 9. Defendants argue that the trial court erred in denying the motion to transfer venue from Hinds County. "The decision to grant or deny a motion for a change of venue lies within the discretion of the trial court and will not be disturbed unless the trial court abuses its discretion."
Penn Nat'l Gaming, Inc. v. Ratliff
,
A. Mississippi Consumer Protection Act
¶ 10. Defendants first argue that venue is improper in Hinds County pursuant to the venue statute of the Mississippi Consumer Protection Act ("MCPA"). The MCPA mandates that actions "shall be brought in the chancery or county court of the county in which such person resides or has his principal place of business, or, with consent of the parties, may be brought in the chancery or county court of the county in which the State Capitol is located."
Defendants contend that because no defendant resides or has its principal place of business in Hinds County and because no defendant consented to venue in Hinds County, venue in Hinds County is not proper.
¶ 11. This Court previously has held that, in cases involving a foreign corporation with its principal place of business outside the state, "the only place where it can be said to reside in this state is where an agent for service of process may be found."
Ratliff
,
The appointment or maintenance in this state of a registered agent does not by itself create the basis for personal jurisdiction over the represented entity in this state. The address of the agent does not determine venue in an action or proceeding involving the entity.
¶ 12. Defendants argue that the statute's language does not wholly bar consideration of a registered agent's location for venue purposes. Instead, Defendants contend that the location of a registered agent does not, by itself, ultimately determine venue but is still relevant in the venue analysis. Therefore, because each Defendant's principal place of business is outside the state, the location of two Defendants' registered agents is the closest available proxy for residence. Because two Defendants maintain registered agents in Rankin County, Defendants argue that Rankin County is the proper location for the instant action. Defendants also argue that the trial court's interpretation of the RAA incorrectly overruled longstanding precedent holding that foreign corporations are subject to venue where their registered agents are located.
¶ 13. We find that the trial court correctly determined that the RAA effectively made the location of a corporation's registered agent irrelevant to the venue analysis. The plain language of the statute clearly states that "the address of the agent does not determine venue in an action or proceeding involving the entity."
¶ 14. Because the RAA excluded consideration of the location of a corporation's registered agent from the question of venue, the MCPA's venue statute provides no choice of venue for foreign corporations. Thus, this Court must look to the general venue statute for chancery court actions.
B. Chancery-Court Venue Statute
¶ 15. Defendants argue that if this Court determines that the MCPA's venue statute is not applicable, this Court should apply the general venue statute for chancery courts, Mississippi Code Section 11-5-1, to determine that venue is appropriate in Rankin County. Section 11-5-1 states in relevant part,
[A]ll cases not otherwise provided may be brought in the chancery court of any county where the defendant, or any necessary party defendant, may reside or be found; and in all cases process may issue to any county to bring in defendants and to enforce all orders and decrees of the court.
¶ 16. This Court finds that the RAA overruled
Ratliff
and its holding that a non-resident defendant "resides" in the county where its agent for service of process is located. As the statute provides, the address of a registered agent does not determine venue. As further support, this Court, in
Smith v. Kansas City Southern Railway Company
,
KCS has a registered agent in Rankin County, Mississippi. However, Mississippi Code Section 79-35-15 now specifically states that "the address of the agent does not determine venue in an action or proceeding involving the entity."Miss. Code Ann. § 79-35-15 (Rev. 2013).
Smith v. Kansas City S. Ry. Co.
,
C. General Venue Statute
¶ 17. Because neither of the above statutes applied to this case, the trial court found that Mississippi Code Section 11-11-3, Mississippi's general venue statute, determined venue in this case. The general venue statute states,
(1)(a)(i) Civil actions of which the circuit court has original jurisdiction shall be commenced in the county where the defendant resides, or, if a corporation, in the county of its principal place of business, or in the county where a substantial alleged act or omission occurred or where a substantial event that caused the injury occurred.
(ii) Civil actions alleging a defective product may also be commenced in the county where the plaintiff obtained the product.
(b) If venue in a civil action against a nonresident defendant cannot be asserted under paragraph (a) of this subsection (1), a civil action against a nonresident may be commenced in the county where the plaintiff resides or is domiciled.
¶ 18. Accordingly, because the general venue statute for chancery court does not apply in this case and because Mississippi's general venue statute provides criteria that do not rely on the location of a registered agent, we find that the trial court's reliance on Section 11-11-3 was appropriate.
See
Holmes v. McMillan
,
¶ 19. Defendants also argue that no real conflict exists between the RAA and Section 75-24-9. As discussed above, we disagree and affirm the trial court's denial of Defendants' motion to transfer venue to Rankin County.
CONCLUSION
¶ 20. Because the clear language of the RAA makes the location of a corporation's registered agent irrelevant for the purposes of venue, the trial court in this case correctly denied Defendants' joint motion to transfer venue to Rankin County. Therefore, we affirm the Hinds County Chancery Court's order denying a venue transfer, and we remand this case to that court for further proceedings consistent with this opinion.
¶ 21. AFFIRMED AND REMANDED.
RANDOLPH AND KITCHENS, P.JJ., MAXWELL AND BEAM, JJ., CONCUR. WALLER, C.J., DISSENTS WITH SEPARATE WRITTEN OPINION JOINED IN PART BY COLEMAN AND CHAMBERLIN, J J. COLEMAN, J., DISSENTS WITH SEPARATE WRITTEN OPINION JOINED BY CHAMBERLIN AND ISHEE, JJ.; WALLER, C.J., JOINS IN PART.
¶ 22. Because Mississippi Code Section 11-11-3(1)(b) (Rev. 2004) applies only to venue for actions filed in circuit court and because the specific language of Mississippi Section 75-24-9 bars actions filed in Hinds County without the consent of the parties, I respectfully dissent.
¶ 23. The State chose to bring this action pursuant to the Mississippi Consumer Protection Act ("MCPA"). That act states in pertinent part,
The action shall be brought in the chancery or county court of the county in which such person resides or has his principal place of business, or, with consent of the parties , may be brought in the chancery or county court of the county in which the State Capitol is located.
¶ 24. While the State contends that Hinds County is proper-because the State's Medicaid Agency is located there-the language of Section 75-24-9 specifically states that, without the consent of the parties, the action is precluded from being brought in Hinds County. And nothing in the plain language of the statute limits its application to Mississippi defendants except the expanded definition offered by the majority opinion. It is abundantly clear that the defendants in this action are authorized to do business in Mississippi and did not consent to the action's being filed in Hinds County.
¶ 25. The State contends that venue should be determined by Section 11-11-3(1), not Section 75-24-9, because the State brought claims for monetary damages and sought injunctive and other relief. I agree with the analysis, but I disagree with the result. Had this action been filed in circuit court, Section 11-11-3(1) would control. A legal basis certainly exists for the circuit court to have subject matter jurisdiction. Pendent jurisdiction would then lie for claims associated under the MCPA.
See
State v. Walgreen Co.
,
¶ 26. This Court has repeatedly held that a venue provision under a specific cause of action cannot be abrogated by a general venue statute.
See
Guice v. Miss. Life Ins. Co.
,
[h]ad the Legislature intended for each statute to have equal footing or equal force then both statutes should have had the mandatory "shall" language ... Accordingly, we find that mandatory language, "shall," in the general venue statute ... controls in this case over the permissive language, "may" found in [another venue statute].
Crenshaw v. Roman
,
¶ 27. When "a statute is clear and unambiguous," this Court has found that "no further statutory construction is necessary and the statute should be given its plain meaning."
Guice
,
¶ 28. It is a legal impossibility, however, for this case to proceed as filed. First, the action was brought in the chancery court-not in the circuit court-and the State plainly asserts in its complaint that the suit was filed in chancery court pursuant to Section 75-24-9. By its unambiguous terms, Section 11-11-3(1) applies only to "[c]ivil actions of which the
circuit court
has original jurisdiction[.]"
If venue in a civil action against a nonresident defendant cannot be asserted under paragraph (a) of subsection (1) [civil actions of which the circuit court has original jurisdiction], a civil action against a nonresident may be commenced in the county where the plaintiff resides or is domiciled.
¶ 29. The majority relies on
Wilkerson v. Goss
,
¶ 30. Writing for the majority in
Wilkerson
, Justice Lamar wrote, "we find that the allegations [of Goss] would not support a finding of venue in [Smith County] even if properly supported by cognizable, credible evidence."
¶ 31. Second, this Court has recognized the pendent jurisdiction of circuit courts for claims filed under Section 75-24-9.
Walgreen
,
¶ 32. A legal basis certainly supports the circuit court's exercise of subject-matter jurisdiction of the action. When an action includes both legal and equitable claims, as
these cases do, this Court has repeatedly held that the circuit court is the appropriate forum.
See
ERA Franchise Sys., Inc. v. Mathis
,
¶ 33. Therefore, if pendent jurisdiction exists for claims of a violation of the MCPA, these claims should be brought in circuit court.
See
Walgreen
,
¶ 34. Because of our precedent in Walgreen , I believe the proper course is to reverse and remand this case to the Chancery Court of Hinds County and to direct that the action be transferred to a circuit court of the State's choice so that it may properly invoke its choice of venue under Section 11-11-3(1).
¶ 35. For these reasons, I respectfully dissent.
COLEMAN AND CHAMBERLIN, JJ., JOIN THIS OPINION IN PART.
¶ 36. Venue is a function of statute, or so we have written in several opinions over the decades.
See, e.g.
,
State v. Walgreen Co.
,
I. The majority fails to explain why the prohibition against venue in Hinds County, found in Section 75-24-9, continues to apply to non-Mississippi defendants.
¶ 37. In his opinion, which I join to the extent that it establishes the effect of Section 75-24-9 as a specific venue statute, 6 the Chief Justice has well explained why, as a more specific venue statute, the venue requirements of the Consumer Protection Act govern over the general venue statute and prohibit venue in Hinds County. The majority offers precious little response to the established authority upon which the Chief Justice relies, and I write to explain why, in my opinion, what little resistance is offered fails.
¶ 38. In dismissing the application of Section 75-24-9, the majority takes the novel position that the statute only applies to Mississippi defendants; two fatal problems face the majority's reasoning.
¶ 39. First, as explained by the majority, it is an amendment to the Registered Agent Act forbidding the use of a registered agent's address in determining venue that spawns today's difficulty. Prior to the amendment, nobody would dispute that Section 75-24-9's prohibition against venue in Hinds County absent consent would apply to non-Mississippi defendants or, put differently, that the Legislature intended that non-Mississippi defendants could not be sued in Hinds County without agreeing to it. Indeed, pursuant to the majority's reasoning, a non-Mississippi defendant who nevertheless maintains a principal place of business in Mississippi would fall within the statute. A change to another statute that renders one disjunctive clause of three inapplicable to only part of a class of defendants does not suffice to indicate that the Legislature intended all of the provisions of Section 75-24-9 to cease having any effect as to the remaining part of the class of defendants in question.
¶ 40. Second, if the majority means what it writes when it holds that Section 75-24-9, in its entirety, no longer applies to non-Mississippi defendants, then the majority must explain why the Legislature's decision to exclude non-Mississippi defendants from its scope does not lead to the inexorable conclusion that the Legislature intended to create a venue gap and exclude non-Mississippi defendants from suit anywhere in Mississippi pursuant to the Consumer Protection Act. It is one thing to render part of Section 75-24-9 inapplicable to certain non-Mississippi defendants (who maintain no principal place of business in Mississippi); it is quite another to hold that the Legislature has expressed a positive intent to exclude all out-of-state defendants from the specific venue statute.
II. Although Section 75-24-9 continues to apply to non-Mississippi defendants, the majority correctly holds that Section 11-11-3 applies to the instant chancery court case.
¶ 41. Although, as explained above, the prohibition against venue in Hinds County absent consent of the parties applies, I agree with the majority in the following respects. First, the venue provision of the Mississippi Consumer Protection Act fails to set venue for the underlying civil action. Second, the Registered Agents Act has abrogated our caselaw that allows the Court to use the address of a corporate entity's registered agent for service of process to determine its principal place of business within Mississippi for the purpose of setting venue. Third, the chancery court venue statute, Section 11-5-1, does not provide an appropriate venue for the above-styled case. Furthermore, I agree that the circuit court general venue statute, Section 11-11-3, does provide the appropriate venue. Accordingly I part ways with the Chief Justice's opinion here, as he would hold that Section 11-11-3 applies only to cases filed in circuit court. As explained below, we have already held that Section 11-11-3 applies to cases filed in courts other than circuit court.
¶ 42. Mississippi Code Section 11-11-3 provides, in pertinent part, as follows:
(1)(a)(i) Civil actions of which the circuit court has original jurisdiction shall be commenced in the county where the defendant resides, or, if a corporation, in the county of its principal place of business, or in the county where a substantial alleged act or omission occurred or where a substantial event that caused the injury occurred.
(ii) Civil actions alleging a defective product may also be commenced in the county where the plaintiff obtained the product.
(b) If venue in a civil action against a nonresident defendant cannot be asserted under paragraph (a) of this subsection (1), a civil action against a nonresident may be commenced in the county where the plaintiff resides or is domiciled.
¶ 43. Although the State chose to file the above-styled case in chancery court, it is a case over which the circuit court enjoys original subject-matter jurisdiction.
See
State v. Walgreen Co.
,
CHAMBERLIN AND ISHEE, JJ., JOIN THIS OPINION. WALLER, C.J., JOINS THIS OPINION IN PART.
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3235603/ (last visited October 16, 2018).
The State's complaint contains allegations of violations of Mississippi's Medicaid Fraud Control Act, Mississippi Code Sections 43-13-201 to -607 (Rev. 2015). Pursuant to the Medicaid Fraud Control Act, actions "may be filed in the circuit court of the First Judicial District of Hinds County ...."
Mississippi Rule of Civil Procedure 82(d) provides,
When an action is filed laying venue in the wrong county, the action shall not be dismissed, but the court, on timely motion, shall transfer the action to the court in which it might properly have been filed and the case shall proceed as though originally filed therein. The expenses of the transfer shall be borne by the plaintiff. The plaintiff shall have the right to select the court to which the action shall be transferred in the event the action might properly have been filed in more than one court.
M.R.C.P. 82(d).
Cephalon has since withdrawn its authority to transact business in the State of Mississippi and has appointed the Mississippi Secretary of State as its agent for service of process. The State argues that if the RAA did not make the location of a registered agent irrelevant for venue purposes, Cephalon would now be considered a resident of Hinds County for venue purposes. However, because proper venue is determined at the time the lawsuit originally is filed, this contention is without merit.
See
Crenshaw v. Roman
,
The State points out that its complaint also contains four common-law causes of action under which venue is proper in the circuit court. The State argues that Mississippi Rule of Civil Procedure 82(c) clearly allows a suit to be brought in any county in which any one of the claims could have been brought. Rule 82(c) provides,
Where several claims or parties have been properly joined, the suit may be brought in any county in which any one of the claims could properly have been brought. Whenever an action has been commenced in a proper county, additional claims and parties may be joined, pursuant to Rules 13, 14, 22 and 24, as ancillary thereto, without regard to whether that county would be a proper venue for an independent action on such claims or against such parties.
M.R.C.P. 82(c). As the State argues, the above claims are allowed to be tried in circuit court.
As more fully explained below, I do not join the Chief Justice's dissent to the extent that he would hold that the general venue statute, Section 11-11-3, only applies to cases filed in circuit court.
Reference
- Full Case Name
- PURDUE PHARMA L.P., Purdue Pharma, Inc., the Purdue Frederick Company, Inc., Teva Pharmaceuticals, USA, Inc., Cephalon, Inc., Johnson & Johnson, Janssen Pharmaceuticals, Inc., Ortho-McNeil-Janssen Pharmaceuticals, Inc. N/K/A Janssen Pharmaceuticals, Inc., Janssen Pharmaceutica, Inc., N/K/A Janssen Pharmaceuticals, Inc., Endo Health Solutions Inc., Endo Pharmaceuticals, Inc., Watson Laboratories, Inc. N/K/A Actavis Laboratories Ut, Inc., Actavis LLC and Actavis Pharma, Inc. F/K/A Watson Pharma, Inc. v. STATE of Mississippi
- Cited By
- 6 cases
- Status
- Published