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Daniel Haggart v. Endogastric Solutions

February 4, 2011


The opinion of the court was delivered by: Magistrate Judge Lisa Pupo Lenihan

Re: ECF No. 13


Presently before the Court is the Motion to Dismiss pursuant to Federal Rule of Civil Procedure 12(b)(1)&(6), and Federal Rule of Civil Procedure 9(b) filed by Defendant Endogastric Solutions, Inc. For the reasons that follow, the Motion will be denied.


Plaintiff, Daniel Haggart ("Plaintiff"), both individually and on behalf of a putative class, filed this action against Defendant, Endogastric Solutions, Inc. ("Defendant"), on March 16, 2010. An Amended Class Action Complaint was filed with leave on May 18, 2010 and Plaintiff‟s Motion for Class Certification was denied without prejudice as premature. The Amended Complaint brings claims for product liability, fraudulent and negligent misrepresentation, negligence, and violation of Pennsylvania‟s Unfair Trade Practices and Consumer Protection Law ("UTPCPL"), 73 P.S. § 201. In late June, Defendant filed its Motion to Dismiss for failure to meet the jurisdictional requirements of the Class Action Fairness Act ("CAFA"), 28 U.S.C. § 1332(d). In addition, Defendant moved to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to meet the requirements of Rule 23. Defendant also moved to dismiss Plaintiff‟s fraud allegations for failure to meet the pleading requirements of Federal Rule of Civil Procedure 9(b), and claims under the Pennsylvania UTPCPL because Plaintiff is not a Pennsylvania resident.


Plaintiff alleges that he is a North Carolina resident and that Defendant is a Washington corporation. Plaintiff suffered from gastroesophageal reflux disease ("GERD") which was managed acceptably through pharmaceuticals and without surgery for many years. Although he was a candidate for surgical intervention through a "Nissen Fundoplication," he had reservations regarding the device‟s permanence and potential side effects. Plaintiff learned of Defendant‟s alternative device, the "EsophyX," which is used in transoral incisionless fundoplications. He attests that he relied on representations made by Defendant in its website and other advertising regarding the "reversibility" of the insertion of this device in electing this procedure, which was performed in a Pittsburgh, Pennsylvania medical facility by a Pittsburgh surgeon identified on Defendant‟s website. Plaintiff‟s surgery occurred in June, 2009 and three months later, his surgeon advised that the procedure had failed and recommended that Plaintiff proceed with the Nissen Fundoplication. Plaintiff attests that he then learned that the EsophyX procedure was "revisable" and not truly "reversible" (in that it could not be completely undone) because tissue had grown around the fasteners. As a direct result, Plaintiff was foreclosed from other previously-available treatment options, and the Nissen Fundoplication was performed in February, 2010.

I. Motion to Dismiss for Lack of Subject Matter Jurisdiction Pursuant to Fed. R. Civ. P. 12(b)(1)

Defendant first argues that Plaintiff‟s Amended Class Action Complaint should be dismissed for lack of subject matter jurisdiction because Plaintiff has failed to meet the requirements of 28 U.S.C. §1332 with respect to both the amount in controversy and the size of the putative class. As to the amount in controversy, Defendant argues that Plaintiff has pled only that "the total amount in controversy as to the whole class of Plaintiffs is believed and averred to be in excess of $5,000,000.00," citing to the Amended Class Action Complaint, ECF No. 6 at ¶5.

CAFA confers federal courts removal and original jurisdiction over any class action where "the matter in controversy exceeds the sum or value of $5,000,000, exclusive of interest and costs, . . . ." 28 U.S.C. § 1332(d)(2). Although a court will ordinarily accept plaintiff‟s allegations that the amount in controversy exceeds the jurisdictional threshold, a complaint must allege facts to support that this requirement has been satisfied. McNutt v. Gen. Motors Acceptance Corp., 298 U.S. 178, 189 (1936). In ruling on a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(1), a court will use the "legal certainty test" to determine whether the jurisdictional amount has been satisfied. St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 289 (1938). The "legal certainty test" provides that the amount in controversy requirement will be met, unless it appears to a legal certainty that plaintiff‟s claims are for less than the jurisdictional amount. Red Cab, 303 U.S. at 289. In Red Cab, theUnited States Supreme Court noted as follows:

The intent of Congress drastically to restrict federal jurisdiction in controversies between citizens of different states has always been rigorously enforced by the courts. The rule governing dismissal for want of jurisdiction in cases brought in the federal court is that, unless the law gives a different rule, the sum claimed by the plaintiff controls if the claim is apparently made in good faith. It must appear to a legal certainty that the claim is really for less than the jurisdictional amount to justify dismissal. The inability of plaintiff to recover an amount adequate to give the court jurisdiction does not show his bad faith or oust the jurisdiction. Nor does the fact that the complaint discloses the existence of a valid defense to the claim. But if, from the face of the pleadings, it is apparent, to a legal certainty, that the plaintiff cannot recover the amount claimed or if, from the proofs, the court is satisfied to a like certainty that the plaintiff never was entitled to recover that amount, and that his claim was therefore colorable for the purpose of conferring jurisdiction, the suit will be dismissed. Events occurring subsequent to the institution of suit which reduce the amount recoverable below the statutory limit do not oust jurisdiction.

Red Cab, 303 U.S. at 288-290 (footnotes omitted).

In his 32-page Amended Complaint, Plaintiff avers that he "suffered severe harm, including the unnecessary pain and suffering of multiple surgeries . . . ." (Amended Complaint, ECF No. 6 at ¶ 68.) Plaintiff further avers that his own individual damages are in excess of $75,000.00 (Amended Complaint, ECF No. 6 at ¶ 3), that on information and belief, he avers "that more than a thousand individuals have undergone the EsophyX procedure in various states, including Pennsylvania, and that many more will continue to undergo this procedure in the future." (Amended Complaint, ECF No. 6 at ¶ 71.) Plaintiff argues that the basis for this belief is Defendant‟s own website. (Plaintiff‟s Brief in Opposition to Defendant‟s Motion to Dismiss, ECF No. 15 at 4.) As to Plaintiff and all members of the putative class, Plaintiff seeks past and future medical expenses, past and future lost earnings, past and future lost earning capacity, past and future pain and suffering, damages for physical disfigurement and unnecessary and painful surgical treatment. He also seeks punitive damages on behalf of himself and all members of the putative class. (Amended Complaint, ECF No. 6 at ¶ 70.)

Defendant submits a Reply Brief wherein it argues for the first time that where a challenge to the amount in controversy concerns a factual dispute, the party alleging jurisdiction must justify its allegations by preponderance of the evidence, relying heavily on Seymour v. Life Care Ret. Communities, Inc., No. 09-444, 2010 WL 2521004 (W.D. Pa. June 21, 2010) (Lancaster, J.). Seymour involved a motion for summary judgment where the parties, subsequent to discovery, disputed the amount in controversy where the damages concerned, in part, the valuation of destroyed personal items including family and ancestral pictures/histories, diaries, and letters. Consequently, the district court in Seymour applied the preponderance of the evidence standard set forth in McNutt v. General Motors Acceptance Corp. of Indiana, 298 U.S.178 (1936), rather than the Red Cab ...

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