F.G. v. CooperSurgical, Inc.

[3] 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA [6] 7 F.G., et al., Case No. 24-cv-01261-JST 8 Plaintiffs, ORDER GRANTING IN PART AND 9 v. DENYING IN PART MOTION FOR PROTECTIVE ORDER IN PART 10 COOPERSURGICAL, INC., et al., Re: ECF No. 8 Defendants. [12] 13 Before the Court is Plaintiffs’ motion for a protective order. ECF No. 8. The Court will 14 grant the motion in part and deny it in part. 15 I. BACKGROUND 16 A. Defendants CooperSurgical, Inc. and The Cooper Companies 17 Defendants CooperSurgical, Inc. (“CooperSurgical”) and The Cooper Companies, Inc. 18 (“TCC”) “manufacture, market, and sell products to fertility clinics, including a culture media 19 product designed to support the growth and development of embryos created through [in vitro 20 fertilization].” ECF No. 1 ¶ 2.1 “The culture media is a nutrient-rich liquid that surrounds a 21 fertilized egg during the incubation period to help it develop into a viable embryo as part of the 22 IVF process.” Id. 23 “In December 2023, CooperSurgical recalled certain lots of its culture media products[.]” 24 Id. ¶ 3. The recall notice stated, in part, that “CooperSurgical [had] become aware of a sudden 25 increase in complaints regarding the aforementioned lots of this product,” and acknowledged that 26 the “risk to health is impaired embryo development prior to the blastocyst stage.” Id. ¶ 46. [27] 1 “According to regulatory authorities, CooperSurgical issued the recalls because the recalled 2 batches of the Global Media were deficient in magnesium . . . a critical component and essential 3 element of embryo culture media[.]” Id. ¶ 47. “The FDA posted a notice on its website regarding 4 the recall in February 2024, estimating that 994 bottles of culture media were affected, 481 of 5 which were purchased by clinics across the United States.” Id. ¶ 51.2 6 B. Plaintiffs F.G. and H.I. 7 “Plaintiffs F.G. and H.I. are a married couple that sought IVF treatment at a fertility clinic 8 in New York” in the hopes of having biological children. Id. ¶ 4. Plaintiffs bring this action on 9 behalf of themselves and on behalf of a class of “individuals in the United States whose eggs 10 and/or embryos were exposed” to recalled lots of Defendants’ product. Id. ¶ 59. 11 “On or around November 2023, Plaintiffs’ fertility clinic fertilized four of F.G.’s eggs with 12 H.I.’s sperm and placed them in Defendants’ culture media.” Id. ¶ 55. Plaintiffs allege that 13 “[e]ach of the four eggs was successfully fertilized, but all of Plaintiffs’ developing embryos were 14 destroyed due to Defendants’ defective culture media.” Id. ¶ 56. In February 2024, “F.G and H.I. 15 were notified . . . that all of their embryos were exposed to the defective culture media, which was 16 subject to a recall.” Id. ¶ 57. Plaintiffs aver that “[t]he embryos that [they] lost are irreplaceable” 17 because “F.G. is older now than she was at the time the eggs used to create the lost embryos were 18 retrieved.” Id. ¶ 58. As a result, Plaintiffs contend that “even if [they] are able to create additional 19 embryos—a physically, emotionally, and financially costly procedure that is by no means 20 guaranteed to succeed—those embryos made with older eggs would not have as high of a chance 21 of successfully developing into a healthy child or children.” Id. 22 Plaintiffs filed this putative class action against Defendants on March 1, 2024, alleging, 23 inter alia, strict products liability (manufacturing defect, design defect, and failure to warn), 24 negligent failure to recall, negligence or gross negligence, trespass to chattels, and unjust 25 enrichment. ECF No. 1. Including the present case, there are at least 21 cases pending before the 26 undersigned making similar claims against Defendants. [27] 1 C. CooperSurgical’s Contacts with Putative Class Members 2 Since January 13, 2024, CooperSurgical has been contacting affected patients through a 3 settlement program that it calls the “Fertility Patient Program.” ECF No. 30 at 7. The 4 communications to affected patients, which are conducted through third-party clinics, indicate that 5 “a lot of global culture media from CooperSurgical” was recalled and that “embryos from your 6 IVF case . . . were exposed to the recalled media.” ECF No. 8-3 at 2. In addition, the 7 communications state that, in order to reach a resolution, the patient must execute a “HIPAA 8 release” to share “cycle and contact information with CooperSurgical.” Id. Although the 9 communications have continued since the filing of this putative class action, there is no evidence 10 that CooperSurgical has advised patients of the existence of the litigation. See ECF No. 8-7 at 2; 11 ECF No. 32-2 at 2. Plaintiffs now bring this motion for a protective order seeking to prevent 12 Defendants from communicating with putative class members. ECF No. 8. Plaintiffs request that 13 the Court “invalidate any releases or settlements the Defendants have procured,” “prohibit 14 Defendants from communicating with class members,” and “furnish Plaintiffs’ counsel with the 15 names of all class members they have contacted directly.” Id. at 9–10. They also ask the Court to 16 order Defendants to distribute a corrective notice. Id. at 10–11. 17 II. JURISDICTION 18 The Court has jurisdiction under 28 U.S.C. § 1332 . 19 III. LEGAL STANDARD 20 “Because of the potential for abuse, a district court has both the duty and the broad 21 authority to exercise control over a class action and to enter appropriate orders governing the 22 conduct of counsel and parties.” Gulf Oil Co. v. Bernard, 452 U.S. 89, 100 (1981).3 “The 23 prophylactic power accorded to the court presiding over a putative class action under Rule 23(d) is 24 broad; the purpose of Rule 23(d)’s conferral of authority is not only to protect class members in 25 particular but to safeguard generally the administering of justice and the integrity of the class [26] 3 “Although Gulf Oil concerned communications between counsel for the named plaintiff and [27] potential class members, its rationale has been found to apply to communications between 1 certification process.” O’Connor v. Uber Technologies, Inc., No. C-13-3826 EMC, 2014 WL 2 1760314, at *3 (N.D. Cal. May 2, 2014). 3 Gulf Oil mandates that “an order limiting communications between parties and potential 4 class members should be based on a clear record and specific findings that reflect a weighing of 5 the need for a limitation and the potential interference with the rights of the parties.” 452 U.S. at 6 101. “[S]uch a weighing—identifying the potential abuses being addressed—should result in a 7 carefully drawn order that limits speech as little as possible, consistent with the rights of the 8 parties under the circumstances.” Id. at 102 . An order under Gulf Oil “does not require a finding 9 of actual misconduct”—rather, “[t]he key is whether there is ‘potential interference’ with the 10 rights of the parties in a class action.” O’Connor v. Uber Technologies, Inc., No. C-13-3826 11 EMC, 2013 WL 6407583 at *4–5 (N.D. Cal. Dec. 6, 2013). 12 Rule 23(d) does not prohibit offers of settlement to putative class members, but courts may 13 limit communications that improperly encourage potential class members to not join the suit, 14 especially if they fail to provide adequate information about the pending class action. See 15 O’Connor, 2014 WL 1760314 , at *6–7. The best notice will “contain an adequate description of 16 the proceedings written in objective, neutral terms, that, insofar as possible, may be understood by 17 the average absentee class member.” In re Nissan Motor Corp. Antitrust Litigation, 552 F.2d 18 1088, 1104 (5th Cir. 1977). 19 Courts in this district have limited communications, as well as invalidated agreements that 20 resulted from those communications, when they omitted critical information or were otherwise 21 misleading or coercive. See, e.g., O’Connor, 2013 WL 6407583 , at *6 (invalidating arbitration 22 agreements that “shrouded” a class action waiver within one of many provisions in a Licensing 23 Agreement); County of Santa Clara v. Astra USA, Inc., No. 05-3740 WHA, 2010 WL 2724512 , at 24 *4 (N.D. Cal. July 8, 2010) (invalidating releases obtained by letter to putative class that did not 25 attach plaintiffs’ complaint, explain plaintiffs’ claims or the status of the case, or include contact 26 information for plaintiffs’ counsel); Camp v. Alexander, 300 F.R.D. 617, 621, 624 (N.D. Cal. 27 2014) (invalidating opt-outs obtained by letter to employees of defendants stating the class action 1 any explanation of plaintiffs’ claims, a copy of the complaint, or contact information for plaintiffs’ 2 counsel). 3 Other courts throughout the country have also restricted communications or invalidated 4 releases when the communications suffered from similar deficiencies. See, e.g., Friedman v. 5 Intervet Inc., 730 F. Supp. 2d 758, 764 (N.D. Ohio 2010) (defendant obtained settlement releases 6 without informing class members they were giving up the right to participate in putative class 7 action); In re Currency Conversion Fee Antitrust Litigation, 361 F. Supp. 2d 237, 251 (S.D.N.Y. 8 2005) (defendant did not inform class members that they were “forfeiting their rights as potential 9 plaintiffs” in the pending class action). 10 IV. DISCUSSION 11 CooperSurgical does not dispute that, “[a]s part of its response to [the product] recall,” it 12 prophylactically developed a settlement program, called the Fertility Patient Program, to reach out 13 to affected patients and provide reimbursement for any failed IVF cycles. ECF No. 30 at 7. 14 In response to Plaintiffs’ motion for a protective order, CooperSurgical argues that: (1) the 15 Court should decide whether this action is properly considered a putative class action before 16 deciding whether Plaintiffs may invoke Rule 23(d); (2) a summons has not yet issued, and 17 personal jurisdiction and venue are lacking; and (3) Plaintiffs’ motion fails to establish the 18 requisite “clear record” to support the extraordinary relief sought. Id. at 12–14. TCC “joins 19 CooperSurgical’s” various arguments, see ECF No. 29 at 3–4, and additionally contends that it 20 “had no involvement in the facts underlying Plaintiffs’ claims, nor in the Fertility Patient Program 21 at issue in Plaintiffs’ motion.” Id. at 4. 22 A. Class Certification 23 Beginning with class certification, Defendants argue that Plaintiffs inappropriately invoke 24 “Rule 23 offensively,” ECF No. 30 at 14, because “personal injury claims are generally 25 inappropriate for class treatment,” id. (citing Amchem Prods., Inc. v. Windsor, 521 U.S. 591 , 625 26 (1997)); see ECF No. 29 at 8. In Defendants’ view, this puts the remedies available under Rule 27 23(d) out of Plaintiffs’ reach. 1 may not be suitable for class certification because they “present ‘significant questions, not only of 2 damages but of liability and defenses of liability . . . affecting the [individual class members] in 3 different ways.’” Amchem Prods., Inc, 521 U.S. at 625 (quoting Fed. R. Civ. P. 23 advisory 4 committee’s note to 1966 amendment). Nonetheless, it is well-established that a Rule 23(d) 5 protective order can precede class certification. See Mevorah v. Wells Fargo Home Mortg., 2005 6 WL 4813532 , at *3 (N.D. Cal. Dec. 7, 2005) (citing Gulf Oil, 452 U.S. at 101 ) (“Pre-certification 7 communications to potential class members by both parties are generally permitted, and also 8 considered to constitute constitutionally protected speech.”). 9 B. Summons, Personal Jurisdiction, and Venue 10 Next, the Court addresses Defendants’ arguments that a summons must issue before the 11 Court can resolve this order, and that the Court lacks personal jurisdiction and venue over this 12 action. See ECF Nos. 29 at 7–8, 30 at 18–21. 13 First, the arguments concerning the lack of summons are now moot because a summons 14 has issued, and Defendants have been served. See ECF Nos. 44, 50, 51. 15 Second, the Court need not decide questions of jurisdiction and venue prior to resolving 16 the present motion for a protective order. “Jurisdiction is vital only if the court proposes to issue a 17 judgment on the merits.” Sinochem Int’l Co. v. Malaysia Int’l Shipping Corp., 549 U.S. 422 , 431 18 (2007) (internal quotations and alteration omitted); see In re Zyprexa Prod. Liab. Litig., 594 F.3d 19 113, 126 (2d Cir. 2010) (“a federal court has jurisdiction to determine its own jurisdiction. While 20 it must make this determination before it reaches the merits of the case before it, it is empowered 21 to issue non-dispositive orders between the filing of the action and its ultimate determination on 22 the merits.”) (Kaplan, J., concurring). In deciding this motion for a protective order, the Court is 23 not issuing a decision on the merits. See Stewart v. Johnson, No. CV 5:18-037, 2021 WL 24 6752312, at *1 (S.D. Ga. Aug. 10, 2021) (“dispositive motions are those that dispose of cases 25 summarily as a matter of law”); 28 U.S.C. § 636 (b)(1)(A) (listing examples of dispositive 26 motions). 27 Thus, while Defendants may be correct that “there are serious questions” regarding 1 those disputes now. ECF No. 30 at 26. 2 C. Protective Order 3 Having addressed the threshold issues, the Court turns to the merits of Plaintiffs’ request 4 that the Court enter a protective order. As noted above, “an order limiting communications 5 between parties and potential class members should be based on a clear record and specific 6 findings that reflect a weighing of the need for a limitation and the potential interference with the 7 rights of the parties.” Gulf Oil, 452 U.S. at 101 . Courts in this district have limited 8 communications, and sometimes invalidated agreements that resulted from those communications, 9 when they omitted critical information or were otherwise misleading or coercive. See, e.g., 10 O’Connor, 2013 WL 6407583 , at *6. 11 1. Clear Record and Specific Findings 12 Although the Court does not find that CooperSurgical’s communications with class 13 members are coercive, it does conclude that there is a clear record that at least some of 14 CooperSurgical’s communications are misleading. 15 Plaintiffs aver that CooperSurgical’s communications are coercive because they impose an 16 “arbitrary six-month deadline for patients to act on the offer for ‘reimbursement.’” ECF No. 8 at 17 7. They also contend that because CooperSurgical’s offer states that “[t]o reach a resolution for 18 you, we will need your HIPAA release,” this “suggest[s] that Defendants’ offer is the only 19 possible compensation available.” Id. In regard to the six-month deadline, Plaintiffs are correct 20 that “class members are up against their biological clocks and any delay increases risk of failure of 21 unsafe pregnancy.” ECF No. 32 at 6. But that pressure is inherent in class members’ 22 circumstances and is not a function of Defendants’ deadline. Plaintiffs do not provide, and the 23 Court is unable to find, any case authority that supports their position that a six-month deadline is 24 inherently coercive. Indeed, one court in this district held that “a deadline of 11 days . . . for 25 accepting the settlement offer” was insufficient to “warrant judicial intervention” under Rule 26 23(d). Goldthorpe v. Cathay Pac. Airways Ltd., No. 17-CV-03233-VC, 2023 WL 9181466 , at *1 27 (N.D. Cal. Dec. 7, 2023). And further, while the Court finds that CooperSurgical’s HIPAA1 create an inference that putative class members were coerced into signing a release. Nor were 2 CooperSurgical’s communications prior to March 1, 2024 misleading. Prior to that date, no 3 putative class action was on file, and there was accordingly no need to notify putative class 4 members of the existence of one. 5 However, although CooperSurgical’s communications are not coercive, since March 1, 6 2024 they have been misleading and create “a potential for unknowing waivers resulting from a 7 lack of information.” Westerfield, 2007 WL 1062200 , at *3. It does not appear that 8 CooperSurgical is providing notice of the pending class action. Indeed, CooperSurgical 9 acknowledges as much in its opposition, arguing that Plaintiffs “provide no authority to support 10 that CooperSurgical is required––for a communication to absent putative class members not to be 11 misleading––to notify them of a patently deficient and unserved class action.” ECF No. 30 at 26. 12 Caselaw is clear that omitting mention of a pending class action—even an uncertified one—can be 13 misleading. See Friedman, 730 F. Supp. 2d at 765–66 (providing notice of uncertified action was 14 necessary even considering “steep hill plaintiff” faced to establish class certification); In re 15 Currency Conversion Fee Antitrust Litigation, 361 F. Supp. 2d at 251 (defendant did not inform 16 class members of pending class action); Westerfield, 2007 WL 1062200 , at *3 (determining that 17 failure to mention the pending class action was misleading because “a risk exists that franchisees 18 might sign the release without knowing what they are releasing.”); cf. Eshelman v. OrthoClear 19 Holdings, Inc., No. C 07-01429 JSW, 2007 WL 2572349 , at *3 (N.D. Cal. Sept. 4, 2007) (no 20 corrective action was necessary when the offers for settlement (1) apprised the putative class about 21 the pending lawsuit, (2) contained contact information for the plaintiffs’ counsel, and (3) included 22 the second amended complaint). “When a defendant in a proposed class action communicates 23 with potential class members about the case, the defendant is under the highest obligation to do so 24 . . . without omitting information that would be important for the proposed class members to 25 consider, and without a hint of coercion.” Goldthorpe, 2023 WL 9181466 , at *1 (emphasis 26 added). But that is what CooperSurgical is doing—contacting putative class members without 27 informing them of the existence of the litigation. Those communications are misleading. That 1 2. Scope of Remedies 2 Having concluded that Defendants’ communications were and are misleading, the Court 3 turns to the question of remedies. Plaintiffs ask the Court to order “Defendants (and any of their 4 agents) [to] immediately cease and desist contact with class members or their physicians regarding 5 any request for a release that arises out of the subject matter of this litigation and/or any agreement 6 that waives a class member’s rights to recovery in this litigation.” ECF No. 8 at 3. They assert 7 that Defendants should be precluded from using the improperly obtained releases, and request that 8 a Court-approved corrective notice is distributed to all putative class members Defendants 9 contacted. Id. Defendants, on the other hand, ask the Court to take no action and argue there is no 10 basis to void any of the releases already obtained. ECF Nos. 29 at 8, 30 at 27–28. 11 In determining the appropriate remedies, the Court remains guided by Gulf Oil’s caution to 12 impose a “carefully drawn order,” 452 U.S. at 102 , as well as remedies imposed by colleague 13 courts around the country. See Kirby v. Kindred Healthcare Operating, LLC, No. 5:19-CV14 00833-JLS(DFM), 2020 WL 4639493 , at *6 (C.D. Cal. May 1, 2020); Bublitz v. E.I. duPont de 15 Nemours & Co., 196 F.R.D. 545, 550 (S.D. Iowa 2000); Friedman, 730 F. Supp. 2d at 765–68. 16 Having “weigh[ed] the need for a limitation and the potential interference with the rights of the 17 parties,” Gulf Oil, 452 U.S. at 101 , the Court imposes the following remedies: 18 1. By June 3, 2024, CooperSurgical shall produce a list of persons with whom it has 19 communicated regarding settlement or release on or after March 1, 2024 to Plaintiffs, even if such 20 communications began prior to that date. Such list shall include the individuals with whom it 21 attempted to communicate through third parties, even if the individuals in question did not 22 thereafter communicate with CooperSurgical. The production of such information shall be subject 23 to a qualifying protective order.4 [24] 4 “HIPAA typically prevents a covered entity from disclosing PHI without first providing the [25] patient with notice and an opportunity to object to the disclosure. See 45 C.F.R. § 164.512 . A covered entity may nevertheless disclose PHI without prior notice in discovery where a qualifying [26] protective order is in place. See, e.g., Ehrlich v. Union Pac. R.R. Co., 302 F.R.D. 620, 628 (D. Kan. 2014); In re Nat’l Hockey League Players’ Concussion Injury Litig, 120 F. Supp. 3d 942 , [27] 953 (D. Minn. 2015); 45 C.F.R. § 164.512 (e)(1)(ii)(B), (e)(1)(v). A protective order 1 2. Regarding any putative class member with whom Defendants communicated on or 2 after March 1, 2024, who had not executed a release on or before that date, CooperSurgical shall 3 send a corrective disclosure in a form approved by the Court, and shall file a declaration under 4 penalty of perjury by a responsible employee of CooperSurgical that its obligations under this 5 paragraph have been satisfied. Such disclosure shall be sent by first class mail and email. The 6 declaration shall be filed by June 14, 2024. If the putative class member, CooperSurgical, or any 7 entity acting on CooperSurgical’s behalf previously used another method of communication, e.g., 8 text, such corrective notice shall also be sent by that method. If any communications were in a 9 language other than English, all corrective communications shall be in that language as well as in 10 English. 11 3. The parties are ordered to meet and confer to decide on appropriate language for 12 the curative notice, which the parties must submit to the Court for approval within 14 days of the 13 date of this order. If the parties submit competing proposals, the Court will endeavor to choose, in 14 all respects, the single proposal it concludes is most reasonable. See Michael Carrell & Richard 15 Bales, Considering Final Offer Arbitration to Resolve Public Sector Impasses in Times of 16 Concession Bargaining, 28 Ohio St. J. on Disp. Resol. 1 , 20 (2013) (“In baseball arbitration . . . 17 the parties . . . have every incentive to make a reasonable proposal to the arbitrator because the 18 arbitrator will choose the more reasonable offer.”). 19 4. “The curative notice must remedy the deficiencies identified herein and ‘ensure that 20 potential class members receive accurate and impartial information regarding the status, purposes 21 and effects of the class action.’” Kirby v. Kindred Healthcare Operating, LLC, No. 22 519CV00833JLSDFM, 2020 WL 4639493 , at *6 (C.D. Cal. May 1, 2020) (quoting O’Connor v. 23 Uber Techs., Inc., No. C-13-3826 EMC, 2014 WL 1760314 , at *8 (N.D. Cal. May 2, 2014) 24 (emphasis and internal citations omitted)). “For instance, the notice must include a copy of the 25 operative complaint and Plaintiffs’ counsel’s name and contact information. The curative notice [27] return or destruction of the PHI at the conclusion of the litigation. 45 C.F.R. § 164.512 (e)(1)(v); 1 must also indicate that any settling putative class member may void the agreement in the manner 2 described below.” Id. The notice must also indicate that a settling putative class member may 3 wish to consult with an attorney regarding their signed release. 4 5. If the Court later orders, or the parties voluntarily agree to, the disclosure to 5 Plaintiffs’ counsel of information regarding putative class members, including without limitation 6 their identities or contact information (i.e., a “class list”), CooperSurgical shall provide 7 information regarding all such persons regardless of whether they executed a release on or before 8 March 1, 2024, and shall also indicate whether CooperSurgical or its affiliates contend that any 9 such persons have released their claims. 10 6. Because Defendants’ communications with putative class members on and after 11 March 1, 2024, were misleading, releases executed on or after that date are voidable at the election 12 of each settling putative class member. Settling putative class members may elect to void an 13 individual settlement agreement at any time through the end of the opt-out period, should a class 14 be certified, or as otherwise ordered by the Court. Any amount already paid pursuant to a later15 voided agreement may be treated as an offset to any other recovery by the putative class member. 16 7. For any releases obtained after the filing of the class action complaint (March 1, 17 2024) but prior to the issuance of this order, CooperSurgical must issue a corrective disclosure 18 apprising the putative class member that this action is currently pending and that the individuals 19 may wish to consult with an attorney regarding their signed release. CooperSurgical must also 20 include contact information for the Plaintiffs’ counsel and a copy of the class action complaint. 21 The curative notice must also indicate that any settling putative class member may void the 22 agreement in the manner described above. The parties shall meet and confer, and make a proposal 23 to the Court, regarding whether the language of this notice should be included in the disclosure 24 required by Paragraph Two or should be sent as a separate notice. 25 8. As of May 20, 2024, Defendants are ordered to alert Plaintiffs, via email, of any ex 26 parte communications with putative class members regarding the subject matter of this litigation 27 within three days after such communications occur. Additionally, whenever Defendants 1 they must do so in writing and prominently include Plaintiffs’ counsel’s name and contact 2 || information and a copy of the complaint (if one has not previously been provided). 3 These remedies respect Defendants’ First Amendment rights, see Gulf Oil, 452 U.S. at 4 104, while simultaneously mitigating the risk of “unknowing waivers” by putative class members 5 “resulting from a lack of information.” Westerfield, 2007 WL 1062200 , at *3. 6 This order expresses no view regarding additional information about Defendants’ 7 communications with putative class members the parties may obtain through formal discovery or 8 || otherwise. 9 CONCLUSION 10 For the foregoing reasons, Plaintiffs’ motion for a protective order is granted as set forth 11 above, and denied in all other respects. 12 IT IS SO ORDERED. . 13 Dated: May 20, 2024 . M4 JON S. TIGA 8 15 United States District Judge