Law

              Today's case is also about statute of limitations, but we thought adding that to the title would guarantee nobody read any further.  None of these are what we'd call "page-turning" – or maybe in the blog world it should be "scroll-worthy" -- topics.  But, any one of them can be a game changer.   When they combine to lead to a dismissal in circumstances that our readers may find themselves in, we think they are worth a mention.  But we'll make it quick.

            As is so often the case, plaintiffs' counsel gathered their clients and filed a single mass action lumping together plaintiffs from all over the country.  Jaeger v. Howmedica Osteonics Corp., 2016 U.S. Dist. LEXIS 16493 at *7 (N.D. Cal. Feb. 10, 2016).  The defendant, again in a fairly common response, moved to sever the individual misjoined cases and to transfer them to plaintiffs' home districts.  Id. at *8.  Defendant's motion was granted.  The original misjoined complaint was filed in the Southern District of Illinois.  Defendant is a New Jersey corporation.  Plaintiff Jaeger resides in California, where she also received the medical treatment at issue in the case.  Id. at *17.  Plaintiff Jaeger's case was therefore transferred to California. 

            Upon arrival on the West Coast, defendant filed a motion to dismiss on various grounds, chief among them being the statute of limitations.  While both parties focused on California law, plaintiff argued that if her case was time-barred under California law, the court should consider Illinois law because that is where the case was originally filed.  Id. at *16.  Although neither side had squarely briefed the issue, the court took up the choice of law question anyway.

            The court starts with the operative law in a §1404(a) transfer case – the transferee court (California) must apply the choice of law rules of the transferor court (Illinois).  Id. at *18.  The reasoning behind the law is that a §1404(a) transfer applies only when the original court was a proper venue, but the case is transferred to another also proper venue.  Because plaintiff chose a proper venue, although perhaps not the most convenient, she gets the benefit of the law of the state she chose.  But, that rationale, and therefore that law, does not apply where the original venue was improper.  Id. Don't want to incentivize improper filings.  Transfer under this circumstance should be done pursuant to §1406(a). 

            The Jaeger court was therefore faced with a bit of a puzzle.  Defendant had moved for transfer under §1404(a) which should mean that Illinois' choice of law rules came with it.  But, given the complete lack of any connection between this plaintiff or the defendant and the state of Illinois, it is hard to believe that the original venue could have been proper.  Id. at *19.  Word of caution – make sure to ask for transfer under the right statute.  It does matter.

            Since applying any aspect of Illinois law to a dispute between citizens of California and New Jersey simply didn't seem right, the court moved from the technical aspects of the transfer statute to a more substantive personal jurisdiction analysis.  Where the original court lacks personal jurisdiction, the law of the transferee court applies.  Id. at *20-21.  Similar to the reasoning above, if the case wasn't properly brought in the original jurisdiction, that court's law should not attach to the case.  But the Illinois court didn't rule on personal jurisdiction, so the California court had to rely on an inference.  In its transfer decision, the Illinois court concluded that Plaintiff Jaeger's allegations were completely unrelated to Illinois.  Based on that, the California court concluded that "Plaintiff's claim necessarily could not have arisen out of or related to the defendant's forum-related activities so as to support personal jurisdiction."  Id. at *24.  No Illinois personal jurisdiction, no Illinois choice of law.

            The rest of the decision is an application of California's statute of limitations to the circumstances of the case.  The court dismissed plaintiff's claims as time barred but with leave to amend to plead facts to permit application of the discovery rule or fraudulent concealment.  Id. at *46.  On fraudulent concealment, it's worth noting that plaintiff's "generic" allegations that information was concealed and plaintiff was misled were insufficient.  First, the basis for fraudulent concealment has to be different than any cause of action for fraud that is pleaded.  Id. at *31.  Plaintiff has to point to something more that prevented her from timely filing her suit.  Second, fraudulent concealment is subject to Rule 9's heightened pleading requirements.  Id. at *32.  So, plaintiff has some work left to do if she is going to salvage her claim. 

            Tuck this case away for the next time you're considering moving to transfer.  If you want to break away from the law of the transferor court, look to §1406(a) and personal jurisdiction.  They may be your ace(s) in the hole.