In Re: Baycol Products Litigation: Plaintiffs, Respondents-Appellants

Case: 09-1069 Page: 1 Date Filed: 04/03/2009 Entry ID: 3533707
No. 09-1069
IN THE UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT
IN RE: BAYCOL PRODUCTS LITIGATION
PEGGY ANN MAYS, GEORGE F. MCCOLLINS,

individually, and on behalf of all others similarly situated,
Plaintiffs,
KEITH SMITH, SHIRLEY SPERLAZZA,
Respondents-Appellants,
v.
BAYER CORPORATION, a foreign corporation,

authorized to do business in West Virginia as Bayer Corporation,
and also known as Bayer AG and Bayer Pharmaceutical,
Defendant-Appellee,
BAYER AG, a foreign corporation,
GLAXOSMITHKLINE, INC., a foreign corporation,
SMITHKLINE BEECHAM CORPORATION, GLAXOSMITHKLINE PLC,
Defendants.
On Appeal From The United States District Court For The District Of Minnesota
(The Hon. Michael J. Davis) Civil No. 02-199, MDL No. 1431
BRIEF OF DEFENDANT-APPELLEE BAYER CORPORATION
Philip S. Beck Susan A. Weber Peter W. Sipkins

Adam L. Hoeflich James W. Mizgala DORSEY & WHITNEY LLP
Katherine G. Minarik James R.M. Hemmings 50 S. Sixth St., Suite 1500
BARTLIT BECK HERMAN SIDLEY AUSTIN LLP Minneapolis, MN 55402
PALENCHAR & SCOTT LLP 1 South Dearborn Street Tel: (612) 340-2600
54 West Hubbard St., Suite 300 Chicago, IL 60603
Chicago, IL 60610 Tel: (312) 853-7000
Tel: (312) 494-4400
Counsel for Defendant-Appellee Bayer Corporation

SUMMARY AND STATEMENT REGARDING ORAL ARGUMENT
The issue in this appeal is whether adequately represented members of
a putative class may relitigate a final federal court judgment denying class
certification by seeking certification of an identical class in state court. The United
States District Court for the District of Minnesota (Davis, C.J.) denied certification
of a West Virginia economic loss class in the Baycol Products Liability Litigation
(MDL 1431) and entered summary judgment against the named plaintiff, George
McCollins. Appellants Keith Smith and Shirley Sperlazza, members of the
putative McCollins class, then sought certification of the same class in West
Virginia state court. The District Court granted appellee Bayer Corporation’s
motion to enjoin Mr. Smith and Ms. Sperlazza from relitigating class certification.
This Court should affirm that injunction. Appellants seek to relitigate
certification of the identical class that was denied certification in McCollins. As
adequately represented members of the putative McCollins class, appellants are
subject to the jurisdiction of the District Court and bound by its final judgment
denying class certification. The District Court therefore had the authority under
the All Writs Act and the relitigation exception to the Anti-Injunction Act to enjoin
Mr. Smith and Ms. Sperlazza from seeking class certification.
Bayer respectfully suggests that oral argument of 15 minutes per side
is appropriate.
i
CORPORATE DISCLOSURE STATEMENT

Pursuant to Fed. R. App. P. 26.1, the undersigned counsel for Bayer
Corporation certifies that:
Bayer Corporation is a nongovernmental corporation. Bayer
Corporation is wholly owned by Bayer AG.
/s/ Philip S. Beck

Philip S. Beck
Counsel for Appellee

Bayer Corporation
Dated: April 2, 2009
ii
TABLE OF CONTENTS
Summary and Statement Regarding Oral Argument .................................................i
Corporate Disclosure Statement ............................................................................... ii
Table of Contents ..................................................................................................... iii
Table of Authorities ...................................................................................................v
Introduction ................................................................................................................1
Responsive Jurisdictional Statement .........................................................................5
Counter-Statement of the Issues ................................................................................6
Responsive Statement of the Case and of the Facts ..................................................7
I. Baycol.......................................................................................................7
II. The Baycol MDL .....................................................................................9
III. McCollins v. Bayer Corp. ......................................................................11
IV. Smith v. Bayer Corp. .............................................................................13
V. The Injunction........................................................................................15
Summary of the Argument.......................................................................................16
Standard of Review..................................................................................................18
Argument..................................................................................................................19
I. Contrary to Appellants’ “Federalism” Argument, the

Anti-Injunction Act Explicitly Protects Federal Court
Judgments................................................................................................19
II. The District Court Had the Authority and Jurisdiction

to Enjoin Mr. Smith and Ms. Sperlazza from Relitigating
Class Certification .................................................................................21
A. Mr. Smith and Ms. Sperlazza Seek to Relitigate the

Identical Issue Finally Decided in McCollins ............................23
iii
B. The Denial of Class Certification in McCollins Is a

Final Judgment Entitled to Collateral Estoppel Effect ..............30
C. Because Appellants’ Interests Were Fully and Adequately

Represented, They Are Bound In Personam by the
Denial of Class Certification in McCollins ................................31
1. Mr. McCollins Adequately Represented the

Interests of Mr. Smith and Ms. Sperlazza in
Seeking Certification of a West Virginia
Economic Loss Class ........................................................32
2. The “Adequacy of Representation” Standard

Fully Protects the Interests of Absent Class Members
in Class Certification.........................................................37
a. Appellants Cannot Evade the McCollins

Class Certification Decision by Describing
Themselves as “Nonparties” ....................................38
b. Due Process Does Not Impose Notice and

Opt-Out Requirements to Bind Absent
Class Members to a Judgment Denying
Class Certification.....................................................40
c. The Prohibition on “Virtual Representation”

Does Not Apply in the Context of Class
Actions ......................................................................43
III. The District Court Did Not Abuse Its Discretion In Issuing a
Permanent Injunction............................................................................44
Conclusion ...............................................................................................................49
Certificate of Compliance with Rule 32(a)..............................................................51
Certificate of Compliance with Rule 28A(d)(2) ......................................................52
Certificate of Service ...............................................................................................53
iv
TABLE OF AUTHORITIES
Cases
Allen v. Stewart Title Guaranty Co., 06-cv-2426,
2007 WL 916859 (E.D. Pa. Mar. 20, 2007) ......................................................26
Alvarez v. May Dept. Stores Co., 143 Cal. App. 4th 1223
(Cal. Ct. App. 2006) ...........................................................................................26
Amchem Prods., Inc. v. Windsor, 521 U.S. 591 (1997) .....................4,7,32,35,42
American Pipe & Construction Co. v. Utah,

414 U.S. 538 (1974) ...........................................................................................38
Axcan Scandipharm Inc. v. Ethex Corp., 585 F. Supp. 2d 1067

(D. Minn. 2007) .................................................................................................39
Brown v. Ticor Title Ins., Co., 982 F.2d 386 (9th Cir. 1992) ............................37
Canady v. Allstate Ins. Co., 282 F.3d 1005

(8th Cir. 2002) ............................................................................................ passim
Castano v. American Tobacco Co., 84 F.3d 734 (5th Cir. 1996) .................27,47
Chick Kam Choo v. Exxon Corp., 486 U.S. 140 (1988) ...............................20,36
DeBoer v. Mellon Mortgage Co., 64 F.3d 1171 (8th Cir. 1995) .......................33
Deposit Guaranty Nat’l Bank v. Roper, 445 U.S. 326 (1980) ...........................27
Dever v. Hentzen Coatings, Inc., 380 F.3d 1070 (8th Cir. 2004) ......................18
Devlin v. Scardelletti, 536 U.S. 1 (2002) ...........................................................38
Eisen v. Carlisle & Jacquelin, 417 U.S. 156 (1974) .........................................41
Goff v. Menke, 672 F.2d 702 (8th Cir. 1982) .....................................................28
In re BankAmerica Corp. Securities Litig., 263 F.3d 795

(8th Cir. 2004) ....................................................................................................18
In re Baycol Prods. Liab. Litig., 532 F. Supp. 2d 1029

(D. Minn. 2007) .................................................................................................10
v
In re Baycol Prods. Liab. Litig., 321 F. Supp. 2d 1118

(D. Minn. 2004) .................................................................................................10
In re Baycol Prods. Liab. Litig., 218 F.R.D. 197 (D. Minn. 2003) ............ 7-8,10
In re Baycol Prods. Liab. Litig., No. 1431, 2001 WL 34134820

(J.P.M.L. Dec. 18, 2001) ......................................................................................9
In re Bayshore Trucks Sales, Inc., 471 F.3d 1233 (11th Cir. 2006) .............38,40
In re Bridgestone/Firestone, Inc. Tires Prod. Liab. Litig.,

333 F.3d 763 (7th Cir. 2003) ..................................................................... passim
In re Dalkon Shield Punitive Damages Litig., 613 F. Supp. 1112

(E.D. Va. 1985) ..................................................................................................26
In re General Motors Corp. Pick-Up Truck Fuel Tank Prod.

Liab. Litig., 134 F.3d 133 (3d Cir. 1998) ......................................26,27,28,38,40
In re Piper Aircraft Distrib. Sys. Antitrust Litig.,

551 F.2d 213 (8th Cir. 1977) ..................................................................... passim
In re Piper Funds, Inc., Institutional Gov’t Income Portfolio Litig.,

71 F.3d 298 (8th Cir. 1995) ...............................................................................40
In re Rhone-Poulenc Rorer Inc., 51 F.3d 1293 (7th Cir.),

cert. denied 516 U.S. 867 (1995) .......................................................................47
In re SDDS, Inc., 97 F.3d 1030 (8th Cir. 1996) .................................................46
In re U.S. Office Prods. Co. Sec. Litig., 251 F. Supp. 2d 58

(D.D.C. 2003) ....................................................................................................39
In re W. Va. Rezulin Litig., 214 W. Va. 52, 585 S.E.2d 52

(W. Va. 2003) ....................................................................................................29
John Morrell & Co. v. Local Union 304A of United Food &
Commercial Workers, AFL-CIO, 913 F.2d 544 (8th Cir. 1990) .......................28
Johnson v. GlaxoSmithKline, Inc., 166 Cal. App. 4th 1497

(Cal. Ct. App. 2008) ...........................................................................................26
Jones v. St. Paul Cos., Inc., 495 F.3d 888 (8th Cir. 2007) ................................18
vi
J.R. Clearwater Inc. v. Ashland Chem. Co., 93 F.3d 176

(5th Cir. 1996) ..........................................................................................26,27,28
Liles v. Del Campo, 350 F.3d 742 (8th Cir. 2003) ...........................................19
Matthews v. Eldridge, 424 U.S. 319 (1976) ......................................................41
Parklane Hosiery Co., Inc. v. Shore, 439 U.S. 322 (1979) ...............................28
Paxton v. Union Nat’l Bank, 688 F.2d 552 (8th Cir. 1982) ........................ 32-33
Phillips Petroleum Co. v. Shutts, 472 U.S. 797 (1985) .............................4,33,42
Putnam v. Keller, 332 F.3d 541 (8th Cir. 2003) ........................................4,40,41
Redmond v. Moody’s Investor Service, 92 Civ. 9161,

1995 WL 276150 (S.D.N.Y. May 10, 1995) ............................................... 38-39
Rivet v. Regions Bank of Louisiana, 522 U.S. 470 (1998) ................................20
Rouse v. II-VI Inc., No. 2:06-cv-566, 2008 WL 2914796

(W.D. Pa. Jul. 24, 2008) .............................................................................. 27-28
Sanneman v. Chrysler Corp., 191 F.R.D. 441 (E.D. Pa. 2000) .........................42
Semtek Int’l Inc. v. Lockheed Martin Corp., 531 U.S. 497 (2001) ....................22
Sensormatic Sec. Corp. v. Sensormatic Elec. Corp.,

273 Fed. Appx. 256 (4th Cir. 2008) ...................................................................22
St. Jude Medical, Inc. v. Lifecare Int’l, Inc., 250 F.3d 587
(8th Cir. 2001) ....................................................................................................18
Starker v. U.S., 602 F.2d 1341 (9th Cir. 1979) ..................................................27
State v. Miller, 194 W. Va. 3, 459 S.E.2d 114 (W. Va. 1995) ..........................22
Taylor v. Sturgell, ___ U.S. ___, 128 S. Ct. 2161 (2008) ............................26,43
Rules and Statutes

28 U.S.C. § 1332 ................................................................................................14
28 U.S.C. § 1446 ................................................................................................14
vii
28 U.S.C. § 1651 ..........................................................................................2,7,19
28 U.S.C. § 2283 ..................................................................................2,6,7,20,45
Class Action Fairness Act of 2005,

Pub. L. No. 109-2, 119 Stat. 4 .................................................................14,21,47
Fed. R. Civ. P. 23 ...............................................................................................27
Other Authority
5 Newberg on Class Actions § 16.01 (4th Ed.) .................................................39
viii
INTRODUCTION
This Court has long recognized that plaintiffs seeking class
certification “ought not to have unlimited bites at the apple” and that relitigation of
class certification “is wasteful and runs counter to the sound administration of
multi-district cases.” In re Piper Aircraft Distrib. Sys. Antitrust Litig., 551 F.2d
213, 219 (8th Cir. 1977). Nevertheless, appellants Keith Smith and Shirley
Sperlazza contend that plaintiffs have the right to relitigate class certification,
provided that different persons are named class representatives in each successive
case. Neither the Supreme Court nor this Court has so held, and this Court should
reject appellants’ arguments here.
This appeal arises from the Baycol Products Liability Litigation.
Baycol is a cholesterol-reducing medicine that Bayer Corporation withdrew from
the market in 2001. The ensuing federal cases (ultimately involving approximately
22,500 plaintiffs) have been coordinated through multidistrict litigation in the
District of Minnesota before Chief Judge Michael Davis.
In August of 2008, the District Court denied certification of an
economic loss class of West Virginia Baycol users asserting warranty and fraud
claims. The District Court held that individual issues predominated because class
members could not recover without proving individually that they were injured by
Baycol or did not benefit from the medicine. See Addendum to Brief of Appellants
1
(“Smith Add.”) at A01-A20 (McCollins v. Bayer Corp., No. 02-00199 (D. Minn.),
Aug. 25, 2008 Memorandum of Law & Order).
After the federal court McCollins judgment became final, Mr. Smith
and Ms. Sperlazza moved in West Virginia state court for certification of the same
West Virginia economic loss class, again asserting warranty and fraud claims. The
District Court granted Bayer’s motion to enjoin Mr. Smith and Ms. Sperlazza from
relitigating class certification, relying on the District Court’s powers under the All
Writs Act, 28 U.S.C. § 1651, and the relitigation exception to the Anti-Injunction
Act, 28 U.S.C. § 2283. See Smith Add. at A21-A38 (McCollins, Dec. 9, 2008
Memorandum of Law & Order).
On appeal, Mr. Smith and Ms. Sperlazza contend that the relitigation
exception does not apply and, even if it does, the District Court abused its
discretion in enjoining them from seeking class certification in West Virginia.
They raise three arguments:
First, Mr. Smith and Ms. Sperlazza contend that they are not
relitigating the same issue as in McCollins. They do not dispute that they seek
certification of the same class as in McCollins, based on the same argument
rejected in McCollins – that putative class members need not prove that they were
injured by, or did not benefit from, Baycol. However, Mr. Smith and Ms.
Sperlazza claim that their case is different because (a) it includes a common law
2
fraud claim and (b) the state court might exercise its discretion to certify a class
even though the federal court did not.
These arguments fail under the precedents of this Court, which hold:
(a) “The same cause of action framed in terms of a new legal theory is still the
same cause of action,” Canady v. Allstate Ins. Co., 282 F.3d 1005, 1015 (8th Cir.
2002); and (b) an “unfavorable class action determination [can] supply the basis
for a collateral estoppel bar.” In re Piper Aircraft, 551 F.2d at 220-21. Indeed, if
collateral estoppel could be defeated merely by speculation that another court
might exercise its discretion differently, no judgment in any class action would
have preclusive effect.
Second, Mr. Smith and Ms. Sperlazza contend that they are not bound
by the McCollins denial of class certification and are not subject to the personal
jurisdiction of the District Court because they were not parties in McCollins and
did not receive notice and the opportunity to opt out.
However, “unnamed class members have the status of parties for
many purposes” and are bound by a decision denying class certification when their
interests are adequately represented with respect to the certification decision. See
In re Bridgestone/Firestone, Inc. Tires Prod. Liab. Litig., 333 F.3d 763, 768-69
(7th Cir. 2003). Mr. McCollins adequately represented the interests of Mr. Smith
and Ms. Sperlazza in seeking class certification. Indeed, as shown below, his
3
interests and appellants’ are completely aligned. See Amchem Prods., Inc. v.
Windsor, 521 U.S. 591, 625-26 (1997). Accordingly, Mr. Smith and Ms. Sperlazza
are bound by the District Court’s denial of class certification.
A formal notice procedure is not required. Due process requirements
depend on context. See Putnam v. Keller, 332 F.3d 541, 546-47 (8th Cir. 2003).
Formal notice is required to adjudicate the merits of an absent class member’s
claim for money damages. See Phillips Petroleum Co. v. Shutts, 472 U.S. 797,
811-12 (1985). However, the merits of appellants’ claims are not at issue here –
only their interest in securing class certification. That interest is protected through
adequate representation. In re Bridgestone/Firestone, 333 F.3d at 768-69.
Third, Mr. Smith and Ms. Sperlazza argue that no injunction should
have issued because in their view the equities favor plaintiffs, who can litigate low-
value claims only on a classwide basis. The District Court considered the value of
plaintiffs’ claims in McCollins (see Smith Add. at A13), but nevertheless
concluded that individual issues of fact precluded certification of a West Virginia
economic loss class. The District Court did not abuse its discretion in holding that
Bayer, having fought and won the battle over class certification, should not be
required to fight that battle again. Accord Canady, 282 F.3d at 1018.
4
Class certification should not be a “heads-I-win, tails-you-lose”
proposition. In re Bridgestone/Firestone, 333 F.3d at 767. Where, as here, the
putative class has been adequately represented, the requirements of due process
and the relitigation exception are met and absent class members may be enjoined
from asking another court to certify the same class denied certification in a final
federal court judgment. Accordingly, this Court should affirm the order of the
District Court enjoining Mr. Smith and Ms. Sperlazza from relitigating
certification of a West Virginia economic loss class in the Baycol litigation.
RESPONSIVE JURISDICTIONAL STATEMENT

Bayer presents this statement to resolve any confusion about subject
matter jurisdiction arising from appellants’ brief. See Brief of Appellants (“Smith
Br.”) at 8 (first asserting “that the United States District Court for the District of
Minnesota lacked subject-matter jurisdiction over them and the class they seek to
represent,” but then stating that “this factor is distinct from whether the District
Court had the authority to issue an order enjoining proceedings in a state court
action”).
The District Court did not purport to assert jurisdiction over
appellants’ state court case, Smith v. Bayer Corp., No. 01-C-191 (Brooke Co.
W. Va.). Rather, the District Court issued its injunction in McCollins v. Bayer
5
Corp., No. 02-cv-00199 (D. Minn.), 1 to prevent relitigation of the District Court’s
final judgment denying class certification in McCollins. Appellants do not dispute
that the District Court had subject matter jurisdiction over McCollins or that the
District Court had the authority to protect its judgment in McCollins. See Smith
Br. at 8.
Thus, there is no question of subject matter jurisdiction. The only
jurisdictional dispute is whether appellants – as members of the putative class in
McCollins – are subject to the personal jurisdiction of the District Court. As
demonstrated below, they are subject to that jurisdiction. See infra at Argument,
Section II.C.
COUNTER-STATEMENT OF THE ISSUES

1. Did the District Court correctly conclude that Mr. Smith and Ms.
Sperlazza are seeking to relitigate in state court certification of the identical West
Virginia economic loss class to which the District Court denied certification in
McCollins? See 28 U.S.C. § 2283; Canady v. Allstate Ins. Co., 282 F.3d 1005 (8th
Cir. 2002); In re Piper Aircraft Distrib. Sys. Antitrust Litig., 551 F.2d 213 (8th Cir.
1977); In re Bridgestone/Firestone, Inc. Tires Prod. Liab. Litig., 333 F.3d 763 (7th
Cir. 2003).
1
The McCollins action was originally brought by Michael Black, Peggy Ann
Mays, and George McCollins as Black v. Bayer Corp. Mr. Black and Ms. Mays
were not parties at the time the District Court finally decided the issues relevant to
this appeal. See infra at pp. 11-12.
6
2. Did the District Court correctly conclude that, as adequately
represented members of the putative West Virginia economic loss class in
McCollins, Mr. Smith and Ms. Sperlazza are subject to the personal jurisdiction of
the District Court and therefore bound by that denial of certification? See Amchem
Prods., Inc. v. Windsor, 521 U.S. 591 (1997); In re Bridgestone/Firestone, Inc.
Tires Prod. Liab. Litig., 333 F.3d 763 (7th Cir. 2003).
3. Having concluded that it had authority under the All Writs Act, 28
U.S.C. § 1651, and the relitigation exception to the Anti-Injunction Act, 28 U.S.C.
§ 2283, to enjoin Mr. Smith and Ms. Sperlazza from relitigating class certification
in state court, did the District Court properly exercise its discretion by issuing an
injunction? See 28 U.S.C. § 1651; Canady v. Allstate Ins. Co., 282 F.3d 1005 (8th
Cir. 2002); In re Piper Aircraft Distrib. Sys. Antitrust Litig., 551 F.2d 213 (8th Cir.
1977); In re Bridgestone/Firestone, Inc. Tires Prod. Liab. Litig., 333 F.3d 763 (7th
Cir. 2003).
RESPONSIVE STATEMENT OF THE CASE AND OF THE FACTS
I. Baycol
Baycol (cerivastatin) is a prescription cholesterol-reducing medicine
that Bayer AG manufactured and Bayer Corporation distributed under the approval
of the United States Food and Drug Administration (“FDA”) from 1997 until
August 8, 2001. See In re Baycol Prods. Liab. Litig., 218 F.R.D. 197, 201 (D.
7
Minn. 2003) (summarizing Baycol history). Baycol is a “statin,” a member of the
same family of medications as Lipitor, Zocor, and Crestor. See id.
Like all other statins, Baycol has been associated with muscle aches
and pains, as well as more serious side effects, such as rhabdomyolysis (a severe
breakdown of muscle tissue where the substances released into the bloodstream
may on occasion overwhelm the kidneys). See id. From Baycol’s first release,
every FDA-approved label and package insert contained a warning about these and
other side effects, and also warned about the risk of using another class of lipid-
lowering drugs (called “fibrates”) concurrently with Baycol. See, e.g., July 2000
Label, available at http://www.fda.gov/cder/foi/nda/2000/20-
740S008_Baycol_prntlbl.pdf. Starting in December 1999, the FDA-approved label
warned that concurrent use of Baycol and gemfibrozil, one such fibrate, was
“contraindicated due to a risk for rhabdomyolysis.” See, e.g., id.
Despite this contraindication, Bayer continued to receive reports of
rhabdomyolysis in patients who were being co-prescribed Baycol and gemfibrozil.
See August 8, 2001 “Dear Healthcare Professional” Letter, available at
http://www.fda.gov/medwatch/SAFETY/2001/Baycol_deardoc2.pdf. In view of
these continued reports, on August 8, 2001, Bayer voluntarily decided, with the
approval of the FDA, to withdraw Baycol from the market. See id.
8
II. The Baycol MDL
Due to the volume of lawsuits in federal court following the
withdrawal of Baycol, the Judicial Panel on Multidistrict Litigation established
MDL-1431 in the District of Minnesota to coordinate discovery and other pre-trial
proceedings. See In re Baycol Prods. Liab. Litig., No. 1431, 2001 WL 34134820,
at *1-2 (J.P.M.L. Dec. 18, 2001) (unpublished).
From the first year of this litigation, the District Court has supervised
a settlement program that has paid $1.17 billion to 3,135 claimants who suffered
rhabdomyolysis, the specific side effect that led to the withdrawal of Baycol from
the market. See Separate Appendix of Defendant-Appellee (“Bayer App.”) at
BA393-BA394 (In re Baycol Prods. Litig., Pretrial Order (“PTO”) 51); see also id.
at BA479-BA484. Consistent with its efforts to facilitate federal-state coordination
of the Baycol litigation, 2 the District Court established an oversight mechanism, to
assure that federal and state court rhabdomyolysis cases were being settled fairly
and consistently. See PTO 53, available at http://www.mnd.uscourts.gov/ MDL-
Baycol/pretrial_minutes/pretrial_order53.PDF. Bayer has vigorously litigated all
2
The District Court has worked actively and cooperatively with state courts to
coordinate federal and state Baycol litigation – through a joint conference,
correspondence with other judges, and creation of a coordinated federal/state
program for depositions of witnesses overseas. See, e.g., Bayer App. at BA395-
BA401 (PTO 63).
9
other claims, including cases alleging injuries other than rhabdomyolysis and cases
seeking economic recovery for plaintiffs who benefited from taking Baycol.
More than 22,500 plaintiffs have had Baycol cases pending in federal
court over the last eight years. See id. at BA428-BA434. 3 The District Court has
supervised generic and case-specific fact and expert discovery. Thousands of
plaintiffs stipulated to dismissal of their claims rather than respond to written
discovery (see, e.g., id. at BA340-BA392, BA406-BA424 (PTOs 4, 10, 12, 81 &
85)), or had their cases dismissed for failure to produce short-form expert reports
to support their claims that Baycol caused their alleged injuries (see, e.g., id. at
BA435-BA445, BA456-BA465 (PTOs 114 & 131); In re Baycol Prods. Litig., 321
F. Supp. 2d 1118, 1124 (D. Minn. 2004)). The District Court has ruled on
proposed nationwide and statewide classes, generic and case-specific Daubert
motions, and motions for summary judgment. See generally In re Baycol, 218
F.R.D. 197 (deciding petition for various nationwide classes); In re Baycol Prods.
Liab. Litig., 532 F. Supp. 2d 1029 (D. Minn. 2007) (deciding generic Daubert
motions); Smith Add. at A14-A19 (deciding summary judgment motion regarding
3
In addition, Bayer has defended the claims of approximately 17,500 former
Baycol users in state court. See, e.g., Bayer App. at BA428-BA434, BA479-
BA484 (citing the volume of state court claims). The six Baycol cases tried to
juries in state court have produced defense verdicts. Today, the claims of 240
plaintiffs remain pending in state court.
10
Mr. McCollins’ claims). Today, the claims of 24 plaintiffs remain pending in
federal court.
III. McCollins v. Bayer Corp.
In August of 2001, shortly after Baycol was withdrawn from the
market, Michael Black, Peggy Ann Mays, and George McCollins filed a putative
class action complaint in the Circuit Court of Cabell County, West Virginia. See
Separate Appendix of Appellants (“Smith App.”) at SA047-SA058 (Complaint,
Black v. Bayer Corp, et al., No. 01-c-0725 (Cir. Ct. Cabell County, W.Va.)). Their
action was filed on behalf of a consumer class of “[a]ll persons in West Virginia
who purchased the drug cerivastatin under the brand name ‘Baycol’ between
February 1998 and August 8, 2001, or their estates, administrators or other legal
representatives, heirs and beneficiaries.” Id. at SA087 (Black, Second Amended
Complaint, ¶ 34). Plaintiffs sought recovery for economic losses allegedly caused
by Bayer’s breach of warranties and violation of the West Virginia Consumer
Credit and Protection Act (“WVCCPA”), W. Va. Code § 46A-6-101. See id. at
SA089-SA094. Plaintiffs disclaimed recovery for any personal injuries suffered by
putative class members and sought only the recovery of alleged economic loss.
See id. at SA087 (Black, Second Amended Complaint, ¶ 34).
11
McCollins was removed to federal court and transferred to the MDL.
See Bayer App. at BA1-BA20, BA77-BA81. Plaintiffs subsequently amended
their complaint twice, but continued to seek only alleged economic losses on
behalf of a putative class of West Virginia Baycol purchasers. See Smith App. at
SA060-SA076 (Amended Complaint); id. at SA078-SA095 (Second Amended
Complaint). One putative class representative, Peggy Ann Mays, was omitted
from the amended complaints and the claims of another, Michael Black, were
dismissed with prejudice, leaving George McCollins as the lone remaining putative
class representative. See id. (omitting Peggy Ann Mays); Bayer App. at BA116-
BA118 (order of voluntary dismissal of claims of Michael Black).
During discovery, Mr. McCollins’ doctor testified that he suffered no
injury from Baycol and that the medicine reduced his cholesterol. See Smith App.
at SA217-SA221 (testimony of Mr. McCollins’ prescribing physician). Mr.
McCollins moved the District Court to recommend remand of the case. See Bayer
App. at BA160-BA164. Bayer opposed remand and moved to (a) deny class
certification and (b) enter summary judgment against Mr. McCollins on his
individual claims. See id. at BA165-BA278.
After full briefing, on August 25, 2008 the District Court denied
remand, denied class certification, and granted summary judgment in favor of
Bayer on Mr. McCollins’ claims. See Smith Add. at A01-A20 (McCollins,
12
Aug. 25, 2008 Memorandum of Law & Order). Specifically, the District Court
held that, in order to prove liability for economic loss claims under West Virginia
law, “[i]ndividual evidence” as to each putative class member “would be necessary
to determine whether the individual person benefitted from or was injured by
Baycol.” Id. at A12. Because each member of the putative class would have to
present individual evidence on his or her medical history, alleged injuries, and
medical causation, the District Court concluded that individual issues
predominated. See id. at A11-A12. With respect to Mr. McCollins’ individual
claims, the District Court concluded that no genuine issue of material fact
supported his claim that he had not received the benefit of his Baycol purchase,
and granted summary judgment in favor of Bayer. See id. at A14-A19.
Neither Mr. McCollins nor any class member appealed the judgment
of the District Court, which became final on September 25, 2008.
IV. Smith v. Bayer Corp.
Keith Smith, Shirley Sperlazza, and Nancy Gandee filed their class
action complaint in the Circuit Court of Brooke County, West Virginia, in
September 2001. See Smith App. at SA097-SA115 (Complaint, Smith v. Bayer
Corp., et al., No. 01-C-191 (Cir. Ct. Brooke County, W. Va.)). Bayer could not
remove the case because two local defendants were sued in connection with Ms.
13
Gandee’s claim. Although the local defendants were dismissed when Ms.
Gandee’s claim was settled, the dismissals came too late to allow removal. 4
The Smith plaintiffs sought certification of a class of “all West
Virginia residents and others who have ingested Cerivastatin, sold under the trade
name ‘Baycol’ in West Virginia.” Id. at SA097 (Smith, Complaint, ¶ 3). They
asserted personal injury, medical monitoring, and economic loss claims on behalf
of the putative class. See id. at SA103-SA111. During class discovery, the doctor
who treated Mr. Smith and Ms. Sperlazza testified that they suffered no side effects
from Baycol and that the medicine reduced their cholesterol. See id. at SA223-
SA228 (testimony of Mr. Smith’s prescribing physician); id. at SA230-SA234
(testimony of Ms. Sperlazza’s prescribing physician).
On September 30, 2008, seven years after the Smith case was filed and
five days after the District Court’s ruling in McCollins became final, Mr. Smith
and Ms. Sperlazza filed a motion seeking certification of an economic loss class
only. See id. at SA117-SA145. Specifically, they sought certification of a class of
“all West Virginia residents who purchased the drug Baycol in West Virginia . . .
with respect to their consumer protection act claims as set forth in the complaint.”
4
The forum defendants were dismissed after Ms. Gandee settled her claims in July
2003, well after the one-year period for removal. See 28 U.S.C. § 1446. Bayer
was not able to remove the action under the Class Action Fairness Act of 2005,
since the action was filed and the parties became diverse before the effective date
of the Act. See Pub. L. No. 109-2, 119 Stat. 4, at § 9; see also 28 U.S.C. § 1332,
Notes (incorporating Section 9 of the Class Action Fairness Act).
14
Id. at SA122. Counsel for Mr. Smith and Ms. Sperlazza explained that they would
pursue claims for breach of warranty, common law fraud, and violation of the
WVCCPA, seeking “compensation for the improper charge [for purchases of
Baycol] perpetrated upon” class members due to Bayer’s alleged misconduct, as
well as punitive damages. See id. at SA124.
V. The Injunction
Bayer then moved in McCollins in the District of Minnesota to enjoin
Mr. Smith and Ms. Sperlazza from relitigating certification of a West Virginia
economic loss class. See Smith App. at SA021-SA292. After a full briefing and
oral argument, the District Court concluded:
• The issues presented for class certification in McCollins were identical to
those Mr. Smith and Ms. Sperlazza sought to have certified in West
Virginia. See Smith Add. at A26-A27.
• Appellants were absent members of the putative McCollins class. See id. at
A35.
• Appellants’ interests in seeking class certification in West Virginia were
adequately represented by Mr. McCollins in the District Court. See id.
• The McCollins denial of class certification was final and conclusive. See id.
at A28-A31.
15
• Appellants, as absent class members in the McCollins class, were bound in
personam to the denial of class certification in the District Court. See id. at
A32-A36.
Based on these conclusions, the District Court held that the relitigation exception
to the Anti-Injunction Act applied (id. at A24-A36) and the balance of equities
favored injunctive relief (id. at A36-A38). Pursuant to its authority under the All
Writs Act, the District Court issued a narrowly tailored injunction barring
appellants from “seeking certification of an economic loss class of West Virginia
Baycol purchasers” in the Smith case. Id. at A36-A38. Nothing in the District
Court’s order prevents Mr. Smith and Ms. Sperlazza from pursuing their individual
claims in West Virginia state court. See id. at A21-A38.
Mr. Smith and Ms. Sperlazza filed a timely appeal.
SUMMARY OF THE ARGUMENT

At bottom, appellants’ position is that class certification is a “heads-I-
win, tails-you-lose” proposition. In re Bridgestone/Firestone, 333 F.3d at 767. If
a defendant loses a class certification motion, that defendant is faced with litigating
a high-stakes class action. But if a putative plaintiff class is denied certification,
plaintiffs can try their luck in another court; all that is required is a different named
plaintiff. The District Court properly held that plaintiffs are not entitled to game
16
the system this way. None of appellants’ arguments provide a basis for vacating
the carefully-tailored injunction issued by the District Court.
I. Appellants’ preliminary policy argument is based on a lopsided view
of federalism. Congress specifically determined that, to effectuate a judgment, a
federal court may issue an injunction against relitigation in a state court. The
question for this appeal is whether the District Court’s narrow injunction barring
appellants from relitigating certification of a West Virginia economic loss class
already denied certification by the federal MDL court falls within the scope of the
relitigation exception to the Anti-Injunction Act.
II. The relitigation exception applies here. Appellants seek certification
of the same West Virginia economic loss class, for the same relief, on the same
allegations of wrongdoing that the District Court denied certification in McCollins.
Mr. Smith and Ms. Sperlazza’s interests were adequately represented the first time
certification of that class was litigated. Accordingly, they are bound in personam
by the District Court’s denial of class certification in McCollins.
III. The District Court properly exercised its discretion in enjoining Mr.
Smith and Ms. Sperlazza from relitigating certification of a West Virginia
economic loss class. The fact that economic loss claims have limited value does
not give appellants the right to relitigate certification of those claims.
17
The District Court’s final judgment denying class certification in
McCollins is entitled to collateral estoppel effect, and the District Court correctly
determined that the relitigation exception to the Anti-Injunction Act and the
authority vested by the All Writs Act permitted the District Court to protect that
judgment. This Court should therefore affirm the District Court’s order enjoining
Mr. Smith and Ms. Sperlazza from relitigating in state court the same West
Virginia economic loss class that the District Court denied certification in
McCollins.
STANDARD OF REVIEW
This Court reviews de novo the District Court’s finding that it had
personal jurisdiction over appellants. See, e.g., Dever v. Hentzen Coatings, Inc.,
380 F.3d 1070, 1072 (8th Cir. 2004) (“We review personal jurisdiction questions
de novo”); St. Jude Medical, Inc. v. Lifecare Int’l, Inc., 250 F.3d 587, 591 (8th Cir.
2001) (same). Also subject to de novo review is the District Court’s determination
that the relitigation exception to the Anti-Injunction Act applies to this case. See,
e.g., Jones v. St. Paul Cos., Inc., 495 F.3d 888, 890 (8th Cir. 2007) (“We review de
novo the issue whether the Anti-Injunction Act’s relitigation exception applies”);
In re BankAmerica Corp. Securities Litig., 263 F.3d 795, 800 (8th Cir. 2001).
18
This Court reviews for abuse of discretion the order permanently
enjoining Mr. Smith and Ms. Sperlazza from seeking certification of a West
Virginia economic loss class. See, e.g., Liles v. Del Campo, 350 F.3d 742, 746
(8th Cir. 2003) (“We review an order enjoining related litigation for an abuse of
discretion”).
ARGUMENT
I. CONTRARY TO APPELLANTS’ “FEDERALISM” ARGUMENT,

THE ANTI-INJUNCTION ACT EXPLICITLY PROTECTS
FEDERAL COURT JUDGMENTS.
Appellants first argue that the District Court’s injunction offends
“principles of federalism and comity.” Smith Br. at 16-20. To the contrary, an
injunction issued to protect a federal judgment in accordance with the relitigation
exception is wholly consistent with those principles.
Congress decided specifically how to balance competing interests of
federal and state courts, and that balance is codified through the interplay of the All
Writs and Anti-Injunction Acts. The All Writs Act empowers a federal court to
“issue all writs necessary or appropriate in aid of [its] jurisdictio[n],” 28 U.S.C.
§ 1651(a). This grant of authority authorizes a court to issue writs necessary to
protect the collateral estoppel effects of the court’s judgments. Canady, 283 F.3d
at 1018.
19
The Anti-Injunction Act bars injunctions directed to state courts,
except in three specific circumstances. See 28 U.S.C. § 2283. One of those
circumstances – the relitigation exception – explicitly permits issuance of an
injunction to “effectuate [the] judgmen[t]” of a District Court. Id. As the Supreme
Court explained: “The relitigation exception was designed to permit a federal
court to prevent state litigation of an issue that previously was presented to and
decided by the federal court. It is founded in the well-recognized concepts of res
judicata and collateral estoppel.” See Chick Kam Choo v. Exxon Corp., 486 U.S.
140, 147 (1988); 5 see also Rivet v. Regions Bank of Louisiana, 522 U.S. 470, 478
n.3 (1998) (“We note also that under the relitigation exception to the Anti-
Injunction Act, 28 U.S.C. § 2283, a federal court may enjoin state-court
proceedings ‘where necessary . . . to protect or effectuate its judgments’”).
5
Appellants suggest that Chick Cam Choo restricted the scope of the relitigation
exception to federal judgments on federal questions. See Smith Br. at 17-18.
Chick Kam Choo stated only that the purpose of the Anti-Injunction Act exceptions
is to “ensure the effectiveness and supremacy of federal law.” 486 U.S. at 146.
Nothing in the opinion – nor in the language of the Anti-Injunction Act – supports
a distinction between federal court judgments based on federal law and federal
court judgments based on state law.
Appellants also assert that “the mere existence of a parallel lawsuit in state court”
does not support issuance of an injunction. Smith Br. at 19. Bayer agrees. The
injunction here issued only after the District Court entered a final judgment and
after appellants filed a motion in state court to relitigate an issue “presented to and
decided by the federal court.” Chick Kam Choo, 486 U.S. at 147.
20
Thus, Congress already has determined that “principles of federalism
and comity” support the protection of federal court judgments. Indeed, more
recently, Congress confirmed the primacy of federal courts in class actions by
enacting the Class Action Fairness Act (CAFA), which allows removal of cases
like this one and thereby virtually eliminates the potential for plaintiffs to attempt
state court relitigation of federal decisions denying class certification. See Class
Action Fairness Act of 2005, Pub. L. No. 109-2, 119 Stat. 4.
Appellants’ state court lawsuit was filed before the effective date of
CAFA and could not be removed due to the presence of non-diverse defendants
(no longer parties to the case). See supra at 14 n.4. Given the enactment of
CAFA, no overarching, long-term policy question is presented in this appeal. The
question here is only whether the narrow injunction issued by the District Court
falls within the scope of the relitigation exception. As demonstrated below, the
District Court properly concluded that the injunction meets that test.
II. THE DISTRICT COURT HAD THE AUTHORITY AND

JURISDICTION TO ENJOIN MR. SMITH AND MS. SPERLAZZA
FROM RELITIGATING CLASS CERTIFICATION.
The relitigation exception to the Anti-Injunction Act applies because
collateral estoppel bars reconsideration of the McCollins class certification
decision. See In re Bridgestone/Firestone, 333 F.3d at 767-68; accord Canady,
21
282 F.3d at 1017-18; In re Piper Aircraft, 551 F.2d at 220-21. Collateral estoppel
bars relitigation if:
(1) the issue previously decided is identical to the one presented in

the action in question;
(2) there is a final adjudication on the merits of the prior action;
(3) the party against whom the doctrine is invoked was a party or in
privity with a party to a prior action; and
(4) the party against whom the doctrine is raised had a full and fair
opportunity to litigate the issue in the prior action.
State v. Miller, 194 W. Va. 3, 9, 459 S.E.2d 114, 120 (W. Va. 1995). 6 As the
District Court correctly determined, the denial of class certification in McCollins
meets each of these conditions. See Smith Add. at A21-A38 (McCollins, Dec. 9,
2008 Memorandum of Law & Order).
6
“[F]ederal common law governs the claim-preclusive effect of a dismissal by a
federal court sitting in diversity.” Semtek Int’l Inc. v. Lockheed Martin Corp., 531
U.S. 497, 508 (2001). “[A]s the federally prescribed rule of decision,” the
preclusion law of the relevant state applies unless that state’s law is incompatible
with federal principles; in that case, federal collateral estoppel principles control.
See id at 509. See also Sensormatic Sec. Corp. v. Sensormatic Elec. Corp., 273
Fed. Appx. 256, 261 (4th Cir. 2008).
22
A. Mr. Smith and Ms. Sperlazza Seek To Relitigate the Identical

Issue Finally Decided in McCollins.
The first requirement for application of the relitigation exception is
identity of issues. The issue that Mr. Smith and Ms. Sperlazza seek to relitigate in
West Virginia state court – certification of a West Virginia economic loss class – is
identical to that decided in McCollins:
• The putative classes are the same. The District Court in
McCollins declined to certify the following class: “all persons in
West Virginia who purchased the drug cerivastatin under the brand
name ‘Baycol’ between February 1998 and August 8, 2001, or their
estates, administrators or other legal representatives, heirs and
beneficiaries.” Smith App. at SA087. Now, Mr. Smith and Ms.
Sperlazza have asked a West Virginia court to certify an action
seeking purported economic losses only on behalf of the same class:
“all West Virginia residents and others who have ingested
Cerivastatin, sold under the trade name ‘Baycol’ in West Virginia.”
Id. at SA097. Mr. Smith and Ms. Sperlazza do not contest the identity
of classes.
• The economic loss claims are the same. Mr. McCollins
asserted breach of warranty and statutory consumer fraud claims on
behalf of the putative class. Id. at SA089-SA094. Mr. Smith and Ms.
23
Sperlazza have alleged the identical claims, plus common law fraud.
See Smith Br. at 12; Smith App. at SA122-SA123. Appellants
contend that the presence of the common law fraud claim destroys
identity of issues. See Smith Br. at 21-22. This Court already has
rejected that argument, holding in Canady that “[t]he same cause of
action framed in terms of a new legal theory is still the same cause of
action.” Canady, 282 F.3d at 1015. Here, the alleged factual
foundation for the claims in Smith is the same as that in McCollins.
Mr. McCollins, Mr. Smith and Ms. Sperlazza all assert claims arising
from their purchase of Baycol and allege injury based on Bayer’s
purported misrepresentation of Baycol as a safe and effective
medication. Compare Smith App. at SA078-SA095 (McCollins,
Second Amended Complaint) with id. at SA097-SA115 (Smith,
Complaint).
• The legal theory on which class certification turns is the
same. Appellants contend that it does not matter under West Virginia
law whether plaintiffs or absent class members benefited or were
harmed by Baycol; rather, they claim liability can be established
entirely on the basis of Bayer’s alleged misconduct. See id. at SA139-
SA140 (claiming “All consumers . . . would have claims against the
24
defendants because of these deceptive acts regardless of whether they
relied on the statements”). Mr. McCollins advanced the same
arguments in the District Court. See id. at SA168-SA169 (arguing
Bayer’s alleged intent to induce purchase of Baycol is sufficient to
establish claims for economic loss damages).
In short, the class certification litigated in McCollins is identical to that appellants
want to relitigate in Smith.
Mr. Smith and Ms. Sperlazza nevertheless argue that collateral
estoppel does not apply to a decision denying class certification because another
court might exercise its discretion differently. See Smith Br. at 22-28. This Court
already has ruled to the contrary. In In re Piper Aircraft, the Court explicitly stated
that “unfavorable class action determination [can] supply the basis for a collateral
estoppel bar.” In re Piper Aircraft, 551 F.2d at 220-21. In Canady, this Court
applied collateral estoppel to bar subsequent efforts to certify a putative class for
which certification had been denied previously. See Canady, 282 F.3d at 1017.
Similarly, the Seventh Circuit applied collateral estoppel in multi-
district litigation, barring plaintiffs from seeking certification of a nationwide class
in state courts after certification of that class was denied in federal court. See In re
Bridgestone/Firestone, 333 F.3d at 768. In another MDL, the United States
District Court for the Eastern District of Virginia held that a defendant was
25
estopped from seeking certification of a nationwide class of plaintiffs to adjudicate
punitive damages after certification of the same class was blocked by the Ninth
Circuit in related litigation. See In re Dalkon Shield Punitive Damages Litig., 613
F. Supp. 1112, 1115-19 (E.D. Va. 1985); accord Alvarez v. May Dept. Stores Co.,
143 Cal. App. 4th 1223, 1240 (Cal. Ct. App. 2006) (also applying collateral
estoppel to bar relitigation). 7
Appellants cite the Clearwater and In re General Motors decisions in
support of their argument. See Smith Br. at 22-25 (citing J.R. Clearwater Inc. v.
Ashland Chem. Co., 93 F.3d 176 (5th Cir. 1996) (relitigation provision does not
apply because another court might decide class certification differently); In re
General Motors Corp. Pick-Up Truck Fuel Tank Prod. Liab. Litig., 134 F.3d 133
(3d Cir. 1998) (same, following Clearwater)). 8 Those opinions are not persuasive
for three reasons.
7
California courts are divided on this issue. In Johnson v. GlaxoSmithKline, Inc.,
166 Cal. App. 4th 1497 (Cal. Ct. App. 2008), a different division of the same
intermediate appellate court held that enjoining relitigation of class claims would
be inconsistent with the United States Supreme Court’s decision in Taylor v.
Sturgell, ___ U.S. ___, 128 S. Ct. 2161 (2008). The Johnson decision is wrong,
because Taylor explicitly carved out class actions from its ban on virtual
representation. See infra at pp. 43-44.
8
Appellants also cite Allen v. Stewart Title Guaranty Co., 06-cv-2426, 2007 WL
916859 (E.D. Pa. Mar. 20, 2007) (unpublished), a District Court decision from the
Third Circuit, which simply follows In re General Motors and Clearwater.
26
First, those opinions dismiss class certification as purely procedural.
Clearwater, 93 F.3d at 180; In re General Motors, 134 F.3d at 146. That ignores
the reality of class litigation, where “[d]etermining the permissible scope of
litigation is as much substantive as it is procedural” and certification decisions
dramatically change the stakes of litigation. In re Bridgestone/Firestone, 333 F.3d
at 768; Castano v. American Tobacco Co., 84 F.3d 734, 746 (5th Cir. 1996); see
also Deposit Guaranty Nat’l Bank v. Roper, 445 U.S. 326, 336 (1980) (“denial of
class certification stands as an adjudication of one of the issues litigated”). That is
why even interlocutory certification decisions are subject to special appeal
procedures. See Fed. R. Civ. P. 23(f).
Second, these decisions confuse identity of issues – the relevant
inquiry under collateral estoppel law – with identity of possible outcome. Issue
preclusion does not depend on how a prior judgment came out or whether
relitigation might produce a different outcome; it depends on whether a particular
issue has been fully litigated. See Starker v. U.S., 602 F.2d 1341, 1347 n.3 (9th
Cir. 1979) (“The correctness of the ruling in [the prior action] is irrelevant for
collateral estoppel purposes. ‘(A) judgment, not set aside on appeal or otherwise,
is equally effective as an estoppel upon the points decided, whether the decision be
right or wrong’”) (internal citations omitted); Rouse v. II-VI Inc., No. 2:06-cv-566,
2008 WL 2914796, *11 n.9 (W.D. Pa. Jul. 24, 2008) (unpublished) (“The point is
27
that the correctness (or incorrectness) of that [prior] decision is irrelevant to the
collateral estoppel inquiry”). 9
Third, if the role of discretion in class certification decisions barred
application of collateral estoppel, judgments in all class actions would be
unenforceable because discretion plays a role in decisions granting, as well as
denying, class certification. Absent class members who ordinarily are bound by a
final class judgment (Goff v. Menke, 672 F.2d 702, 704 (8th Cir. 1982)), would be
able to evade res judicata and collateral estoppel by asserting that the class would
never have been certified if it had been brought originally in a different forum.
The Clearwater and In re General Motors cases do not, in any event,
apply to the facts of this case because Mr. Smith and Ms. Sperlazza are not simply
seeking a different exercise of judicial discretion in a different court. They are
asking the West Virginia court to de facto overrule a decision of law inextricably
intertwined with the denial of class certification in McCollins, the District Court’s
holding that “individual issues of fact predominate with respect to whether Baycol
benefitted or harmed any particular person.” Smith Add. at A12. Appellants are
9
See Parklane Hosiery Co., Inc. v. Shore, 439 U.S. 322, 327 n.5 (1979) (“Under
the doctrine of collateral estoppel . . . the judgment in the prior suit precludes
relitigation of issues actually litigated and necessary to the outcome of the first
action”) (emphasis added); John Morrell & Co. v. Local Union 304A of United
Food & Commercial Workers, AFL-CIO, 913 F.2d 544, 562 n.14 (8th Cir. 1990)
(same, quoting Parklane Hosiery).
28
using Smith as a vehicle to collaterally attack that judgment, arguing in their state
court certification papers that, “with respect to liability, there are no individual
issues.” Smith App. at SA140. None of the cases cited by Mr. Smith and Ms.
Sperlazza stands for the proposition that appellants may shop a final judgment
premised on a conclusion of substantive law in a different forum hoping to achieve
a different result. To the contrary, this Court has held that litigants “may not []
recycle the same claims and issues in different courts, hoping to achieve the result
they desire.” Canady, 282 F.3d at 1018.
Appellants also cite the West Virginia Rezulin decision, apparently in
support of their view that a class would be certified by a West Virginia court. See
Smith Br. at 26-28 (citing In re W. Va. Rezulin Litig., 214 W. Va. 52, 585 S.E.2d
52 (W. Va. 2003)). 10 As Chief Judge Davis observed, Rezulin certified an
economic loss class on a finding that individual issues of damages did not
predominate over common issues of fact. See Smith Add. at A26-A27; accord In
re W. Va. Rezulin, 214 W. Va. at 74-75, 585 S.E.2d at 74-75. In contrast,
10
Mr. Smith and Ms. Sperlazza also cite Rezulin for the proposition that a West
Virginia court applying West Virginia Rule 23 is not bound by decisions applying
Federal Rule 23. See Smith Br. at 27 (quoting Rezulin statement that a federal case
may be persuasive but is not controlling). See also id. at 19 (“Decisions of federal
courts applying state substantive law are not binding authority on any state court
applying the same state law to the same or similar set of facts”). However, the
issue in this case is not whether the West Virginia state court is bound by the
District Court’s decision in McCollins, but rather whether appellants are bound by
that decision.
29
McCollins held that individual issues of medical causation, dictated by the
elements of proof for economic loss claims under West Virginia law – “whether
the individual person benefitted from or was injured by Baycol” (Smith Add. at
A12) – predominated. See id. at A09-A12. 11
In sum, appellants cannot avoid the fact that they are seeking
certification of the same class that was denied certification in McCollins. Because
the issues presented are identical, the first requirement for application of the
relitigation exception has been met.
B. The Denial of Class Certification in McCollins Is a Final

Judgment Entitled to Collateral Estoppel Effect.
Appellants do not contest the second requirement for application of
the relitigation exception: finality. As this Court has held, an order denying class
certification becomes final for the purposes of collateral estoppel when a final
judgment has issued. See Canady, 282 F.3d at 1016-17. The McCollins judgment
is final; the District Court entered summary judgment against the claims of the sole
remaining plaintiff and no appeal was taken. See Smith Add. at A01-A20.
11
Counsel for appellants claim that, because they were “lead counsel in In re W.
Va. Rezulin Litigation” the Court should trust that “the trial court held in that case
that individual issues predominated over common issues on all questions of
liability, causation, and damages.” Smith Br. at 27 n.6. Counsel cannot rewrite the
Rezulin decision of the West Virginia Supreme Court of Appeals through this
tactic. The opinion supports only the conclusion that West Virginia’s highest court
rejected the claim that individual issues of damages predominated over common
issues of fact with respect to the economic loss claims asserted in that case.
30
Accordingly, the second requirement for application of the relitigation exception
has been met here. 12
C. Because Appellants’ Interests Were Fully and Adequately

Represented, They Are Bound In Personam by the Denial of Class
Certification in McCollins.
The final requirements for application of the relitigation exception are
that the estopped litigant must be a party or in privity with a party in the underlying
case and have had a full, fair opportunity to litigate the issue in question. See
supra at 22. Mr. Smith and Ms. Sperlazza contend that they are not parties, are not
bound by the McCollins judgment, and therefore are not subject to the personal
jurisdiction of the District Court.
There is no argument here that, as unnamed class members, the
McCollins decision binds Mr. Smith and Ms. Sperlazza in any manner with respect
to their individual claims. Appellants are free to pursue those claims in their state
court action. See Canady, 282 F.3d at 1018. With regard to the question of class
certification, however, the result is different. A denial of class certification is
12
Appellants suggest that class certification decisions are not entitled to preclusive
effect because they are not final judgments. See Smith Br. at 22 n.3 (“Generally
speaking, an order refusing to certify, or decertify, a class action is not a final
judgment on the merits sufficient to satisfy res judicata principles underlying the
relitigation exception to the Anti-Injunction Act and may not be appealed as
such.”). This case does not, however, present the question of whether or when an
interlocutory class certification judgment may have preclusive effect. Appellants
concede that the District Court entered a final judgment in McCollins. See id.
(“The District Court’s decision denying class certification in McCollins . . . became
appealable following the entry of final judgment”).
31
“binding in personam with respect to unnamed class members” when those class
members are adequately represented with respect to the certification decision. In
re Bridgestone/Firestone, 333 F.3d at 769. As demonstrated below, appellants
could not have asked for a named plaintiff to more closely represent their position
than Mr. McCollins. Further, appellants’ attack on the “adequacy of
representation” standard is without merit.
1. Mr. McCollins Adequately Represented the Interests of

Mr. Smith and Ms. Sperlazza in Seeking Certification of a
West Virginia Economic Loss Class.
In In re Bridgestone/Firestone, plaintiffs argued that they were
entitled to relitigate class certification seriatim, because class members are not
bound by a decision denying class certification. 333 F.3d at 767. The Seventh
Circuit rejected plaintiffs’ claim that “the legal system entitles them to the benefit
of this heads-I-win, tails-you-lose situation.” Id. Instead, the court concluded that
absent class members are bound by a decision denying class certification where
their interests have been adequately represented in the class certification
proceedings. See id. at 768-69. An absent class member is adequately represented
when the putative class representative (a) is part of the class she or he seeks to
represent, (b) experienced the same alleged injury, and (c) has the same interests as
absent class members. Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 625-26
(1997); see also Paxton v. Union Nat’l Bank, 688 F.2d 552, 562-63 (8th Cir. 1982)
32
(same). 13 Here, the record fully supports the District Court’s determination that
Mr. McCollins “adequately represented” the absent members of his putative class
in seeking class certification. See Smith Add. at A31-A36.
First, Mr. McCollins, Mr. Smith, and Ms. Sperlazza were members of
the putative McCollins class. The proposed economic loss class in McCollins was
comprised of “all persons in West Virginia who purchased the drug cerivastatin
under the brand name ‘Baycol’ between February 1998 and August 8, 2001, or
their estates, administrators or other legal representatives, heirs and beneficiaries.”
Smith App. at SA087. Mr. McCollins, Mr. Smith, and Ms. Sperlazza claim to have
been West Virginians who purchased Baycol within the period defined in the
McCollins class. Id. (Mr. McCollins); id. at SA111-SA114 (Mr. Smith and Ms.
Sperlazza). Indeed, Mr. Smith and Ms. Sperlazza seek to represent the same class
of Baycol purchasers in their putative class action in West Virginia state court.
Compare SA097 (Smith class definition) with SA087 (McCollins class definition);
see also supra at 23.
13
See also Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 808 (1985) (“The absent
parties would be bound by the decree so long as the named parties adequately
represented the absent class and the prosecution of the litigation was within the
common interest.”); DeBoer v. Mellon Mortgage Co., 64 F.3d 1171, 1175 (8th Cir.
1995) (adequacy of representation where named representative and class counsel
had no conflicts with absent class members and “vigorously pursued” the issue in
dispute).
33
Second, Mr. McCollins sought recovery for the same alleged injury –
economic loss allegedly caused by Bayer’s misconduct – for which Mr. Smith and
Ms. Sperlazza now seek recovery on behalf of West Virginia Baycol purchasers in
a West Virginia state court. See supra at 23-24. Moreover, fact discovery has
demonstrated that all three took the same dosage of Baycol (0.4mg), that all three
benefited from Baycol, and that none of the three has a claim for personal injury
supported by testimony from a treating physician. See Smith App. at SA217-
SA221 (testimony of Mr. McCollins’ prescribing physician); id. at SA223-SA228
(testimony of Mr. Smith’s prescribing physician); id. at SA230-SA234 (testimony
of Ms. Sperlazza’s prescribing physician). Accordingly, Mr. McCollins was
situated identically to Mr. Smith and Ms. Sperlazza.
Third, Mr. McCollins, Mr. Smith, and Ms. Sperlazza’s interests are
perfectly aligned. The claims of all three rest on the singular premise that the
purchase of Baycol, without more, amounts to a compensable injury. See supra at
11-15, 24-25. Indeed, the arguments Mr. McCollins presented the District Court in
seeking class certification are echoed in those presented by Mr. Smith and Ms.
Sperlazza in West Virginia. See supra at 24-25. The foundation of Mr.
McCollins’ petition for class certification, like Mr. Smith and Ms. Sperlazza’s
petition in West Virginia, was that plaintiffs need not individually prove injury and
causation in order to recover under West Virginia law, and therefore individual
34
issues of causation and injury do not predominate over common issues regarding
Bayer’s alleged misconduct. See id.
Thus, Mr. McCollins met all of the Amchem requirements for
adequacy of representation. Further, the District Court found that “counsel for the
McCollins plaintiffs vigorously argued in favor of class certification before this
Court.” Smith Add. at A35. That protection – adequate and vigorous
representation – was sufficient to protect Mr. Smith’s and Ms. Sperlazza’s due
process rights and bind them to the McCollins denial of class certification.
Appellants offer two objections to this finding of adequacy. They
complain that (a) the District Court did not make an express finding of adequacy in
the original opinion denying class certification in McCollins, and (b) Mr.
McCollins did not move to reconsider or appeal the denial of class certification.
See Smith Br. at 33-35. Neither objection has merit.
In McCollins, the adequacy of the putative class representative,
George McCollins, was litigated exhaustively. See Bayer App. at BA179-BA181,
BA292-BA298, BA313-BA315 (argument regarding the adequacy of Mr.
McCollins in McCollins class certification briefing). The District Court’s denial of
class certification assumed Mr. McCollins’ adequacy, and rested on a conclusion
of substantive law unrelated to the adequacy of the representation. See Smith Add.
at A07-A14. The adequacy of Mr. McCollins in seeking class certification was
35
litigated in connection with Bayer’s motion for a permanent injunction. See Smith
App. at SA283-SA286, SA307, SA313-SA315 (argument regarding Mr.
McCollins’ adequacy in injunction briefing). The record fully supports the District
Court’s conclusion that Mr. McCollins “adequately represented” absent class
members and that class counsel vigorously pursued certification of the class
claims. Smith Add. at A35; see also supra at Argument, Section II.A.
Appellants attempt to characterize the District Court’s finding of
adequate representation as a “post hoc judgment” foreclosed by Chick Kam Choo,
486 U.S. at 148, but they mischaracterize the Supreme Court’s decision. There,
the Court required “that the claims or issues that the federal injunction insulates
from litigation in state court proceedings actually have been decided by the federal
court” for the relitigation exception to apply. Here, the issue insulated by the
injunction – the denial of certification of a West Virginia economic loss class –
was decided in the McCollins case. See Smith Add. at A01-A20. The District
Court did not engage in any post hoc judgments as to the propriety of class
certification.
Moreover, the fact that Mr. McCollins did not move to reconsider or
appeal the District Court’s denial of class certification did not render him
inadequate. A “decision not to appeal this Court’s previous order denying class
certification does not, in and of itself, render his representation inadequate.” Smith
36
Add. at A35 (citing Brown v. Ticor Title Ins., Co., 982 F.2d 386, 390-91 (9th Cir.
1992)). A putative representative is inadequate only where she or he has “failed to
prosecute or defend the action with due diligence and reasonable prudence.”
Brown, 982 F.2d at 390-91 (internal citation omitted). Appellants have not
identified any substantive deficiency in Mr. McCollins’ pursuit of class
certification, nor have they alleged that he failed to diligently prosecute the case.
Nor can appellants make any such allegations, since their recent motion for class
certification in Smith makes the same arguments Mr. McCollins pressed in his
case. See supra at Argument, Section II.A.
Because Mr. McCollins adequately represented the interests of Mr.
Smith and Ms. Sperlazza in seeking certification of a West Virginia economic loss
class, the McCollins denial of class certification is binding in personam on
appellants. See In re Bridgestone/Firestone, 333 F.3d at 768-69.
2. The “Adequacy of Representation” Standard Fully Protects

The Interests of Absent Class Members in Class
Certification.
Appellants also contend that – regardless of whether their interests
were adequately represented – they cannot be bound by the McCollins denial of
class certification. None of their arguments withstands examination.
37
a. Appellants Cannot Evade the McCollins Class

Certification Decision by Describing Themselves as
“Nonparties.”
Mr. Smith and Ms. Sperlazza assert that, as absent class members,
they are nonparties and “strangers” to the McCollins class certification decision
and therefore cannot be bound by it. See Smith Br. at 28-33 (citing In re Bayshore
Trucks Sales, Inc., 471 F.3d 1233, 1245 (11th Cir. 2006), and In re General
Motors, 134 F.3d at 141, discussed above). However, the Supreme Court has
rejected this rigid approach. Most recently, in Devlin v. Scardelletti, 536 U.S. 1, 7-
10 (2002), the Supreme Court held that, because absent class members have an
interest in class-related decisions, they may appeal those decisions without first
intervening to obtain “party” status. The Supreme Court explained that context
determined the rights and obligations of absent class members:
Nonnamed class members, however, may be parties for some

reasons and not for others. The label ‘party’ does not indicate an
absolute characteristic, but rather a conclusion about the applicability
of various procedural rules that may differ based on context.
Id. at 9-10 (emphasis added). This pragmatic approach also allows absent class
members to benefit from the tolling of limitations periods during the pendency of
class actions, including the period before any ruling on class certification, even
though they are not nominal “parties.” See American Pipe & Construction Co. v.
Utah, 414 U.S. 538, 553-54 (1974); see also Redmond v. Moody’s Investor
Service, 92 Civ. 9161, 1995 WL 276150, *2 (S.D.N.Y. May 10, 1995)
38
(unpublished) (discovery of absent class members on class issues may be
permissible). 14
The In re Bridgestone/Firestone court’s conclusion that absent class
members can be bound by a decision denying class certification, when they have
been adequately represented, follows this well-established line of cases. 333 F.3d
at 768-69. 15 Moreover, this reasoning is reflected in this Court’s recognition that a
14
See also 5 Newberg on Class Actions § 16.01 (4th Ed.) (citing and cross-
referencing citations to cases, “Absent class members are parties for purposes of
being bound by the judgment, receiving the benefit of the tolling of the statute of
limitations, meeting the venue requirements, and having standing to appeal from
decisions and to object to and enforce settlements”).
15
Appellants labor mightily to distinguish In re Bridgestone/Firestone without
effect. See Smith Br. at 29. First, as in In re Bridgestone/Firestone, Mr.
McCollins’ adequacy was litigated exhaustively. See supra at 35-36. Second, the
fact that Mr. McCollins was represented by different counsel is not a material
difference between In re Bridgestone/Firestone and McCollins: the “‘use of the
same counsel in itself is hardly dispositive’ of whether a close relationship exists.”
Axcan Scandipharm Inc. v. Ethex Corp., 585 F. Supp. 2d 1067, 1080 n.16 (D.
Minn. 2007) (internal citation omitted). Third, that the District Court in McCollins
was a transferee court, as opposed to having original jurisdiction as in In re
Bridgestone/Firestone, is a distinction without a difference. “In a [multidistrict
litigation] action, the transferee judge has the same jurisdiction and power over the
pretrial proceedings that the transferor judge would have in the absence of the
transfer.” In re U.S. Office Prods. Co. Sec. Litig., 251 F. Supp. 2d 58, 64-65
(D.D.C. 2003). Fourth, the pleading of a RICO claim in In re
Bridgestone/Firestone did not control the holding in that case. The Seventh Circuit
made clear that its holding was not restricted to unnamed class members in RICO
claims. See In re Bridgestone/Firestone, 333 F.3d at 768 (identifying the broadly
applicable right of an absent class member to seek review of a class certification
decision as another way in which absent class members are treated as parties to a
class proceeding).
39
“district court . . . has the power, under Fed. R. Civ. P. 23 augmented by the All
Writs Act, to control conduct by absent class members that affects management or
disposition of the class action.” In re Piper Funds, Inc., Institutional Gov’t Income
Portfolio Litig., 71 F.3d 298, 300 n.2 (8th Cir. 1995). These precedents all
support the conclusion that appellants cannot relitigate class certification simply
because they were not named “parties” in McCollins. 16
b. Due Process Does Not Impose Notice and Opt-Out

Requirements to Bind Absent Class Members to a
Judgment Denying Class Certification.
Appellants also argue that absent class members cannot be bound to a
class certification decision unless they first receive notice and the opportunity to
opt out. See Smith Br. at 37-40. Mr. Smith and Ms. Sperlazza are mistaken.
Myriad cases recognize that due process is flexible and depends on
context. See, e.g., Putnam, 332 F.3d at 546-47. Procedural due process rights
depend not only on the nature of the right to be protected, but also on the burdens
16
In addition to applying an improper standard in determining the status of absent
class members, In re Bayshore and In re General Motors are distinguishable from
McCollins. In In re Bayshore, there was an express finding that the putative class
representative in the prior action did not adequately represent the class. 471 F.3d
at 1245. In In re General Motors, the Third Circuit remanded the prior action
because the district court had not adequately expressed the basis for class
certification. 134 F.3d at 139, 146. By contrast, in McCollins, the District Court
assumed the adequacy of the putative representative in deciding the propriety of
class certification (Smith Add. at A08), and made an express finding on Bayer’s
motion for an injunction that the putative representative had adequately and
vigorously represented the interests of the absent class members for the purpose of
seeking class certification (Smith Add. at A35).
40
that would come from providing greater levels of procedural protection. See
Matthews v. Eldridge, 424 U.S. 319, 334-35 (1976) (holding that due process
depends on a consideration of the right at issue, the risk of deprivation of that right,
and the burdens of extending greater protections).
Applying this reasoning, the Supreme Court held that notice and the
opportunity to opt-out is required to bind absent class members to a judgment that
adjudicates the merits of their claims. Shutts, 472 U.S. at 811-12. But the merits
of appellants’ claims are not at issue; the District Court enjoined Mr. Smith and
Ms. Sperlazza only from relitigating the preliminary question of class certification.
Appellants’ due process rights must be evaluated in this context. See Putnam, 332
F.3d at 546-47 (due process is contextual). Here, not only is a lesser interest at
issue than in Shutts, but – as the Seventh Circuit observed – a notice-and-opt-out
requirement would impose an unprecedented burden on the parties and on the
court. In re Bridgestone/Firestone, 333 F.3d at 769 (“no statute or rule requires
notice, and an opportunity to opt out, before the certification decision is made; it is
a post-certification step”). Such a burden would fall most heavily on putative class
representatives, who generally bear the costs of notice in a contested class action.
See, e.g., Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 178 (1974) (“The usual rule
is that a plaintiff must initially bear the cost of notice to the class”).
41
The “adequacy of representation” standard balances the competing
interests. It protects: the judicial system’s interest in avoiding the burdens of
duplicative litigation; the defendant’s interest in not fighting again contests already
won; and plaintiffs’ interests by assuring that they will only be foreclosed from
relitigating class certification when – as here – their position has been fairly
represented by someone similarly situated. See Amchem, 521 U.S. at 625-26.
Accordingly, the “adequacy of representation” standard provides the process due in
this context.
Mr. Smith and Ms. Sperlazza assert that the full Shutts requirements
apply because denial of class certification is tantamount to dismissing low-value
claims on the merits. See Smith Br. at 40-42. However, the value of absent class
members’ claims is only one of many factors weighed in a class certification
decision; it does not trump all other competing interests. See, e.g., Sanneman v.
Chrysler Corp., 191 F.R.D. 441, 454-55 (E.D. Pa. 2000) (rejecting contention that
low value claims can supplant all other considerations in determining the propriety
of class certification). Moreover, appellants are not seriously suggesting that
notice and the opportunity to be heard be required before a court rules on class
certification. They did not provide notice before they sought class certification in
Smith.
42
The adequacy of representation test complies with due process
because it protects the competing interests in determining whether absent class
members can be bound by a certification decision. Here, Mr. McCollins
adequately represented the interests of appellants. See Smith Add. at A35.
Accordingly, appellants are subject to the District Court’s jurisdiction and are
bound by its final judgment denying class certification.
c. The Prohibition on “Virtual Representation” Does

Not Apply in the Context of Class Actions.
Mr. Smith and Ms. Sperlazza also assert that binding absent class
members to a judgment denying class certification amounts to “virtual
representation” proscribed by the Supreme Court. Smith Br. at 30-32 (quoting at
length Taylor v. Sturgell, ___ U.S. ___, 128 S. Ct. 2161 (2008)). As the Seventh
Circuit explained in In re Bridgestone/Firestone, “Holding the absent class
members to the outcome [of a class certification proceeding] is no more an
exercise in virtual representation than it is to hold them to a decision on the
merits.” 333 F.3d at 769.
“Virtual representation” is the practice by which a decision on the
merits in a non-class claim is applied to bar the relitigation, by another plaintiff, of
the same issue. In Taylor, for example, the Supreme Court held that a Freedom of
Information Act claim fully litigated on the merits could not bar a subsequent
Freedom of Information Act claim brought by a different plaintiff. See Taylor, 128
43
S. Ct. at 2178-80. Significantly, the Court explicitly carved out class actions,
stating, “[r]epresentative suits with preclusive effect on nonparties include properly
conducted class actions. . . .” Id. at 2172.
No “virtual representation” occurred here. Not only was McCollins
“properly conducted” as described above, appellants are enjoined only from
relitigating class certification and remain free to pursue their individual claims on
the merits. See Canady, 282 F.3d at 1018 (enjoining relitigation of class claims,
but noting the continuing viability of individual claims).
* * *
In sum, the District Court properly concluded, on the law and on the
facts, that the relitigation exception to the Anti-Injunction Act applied here and
permitted the Court to enjoin appellants from relitigating certification of a West
Virginia economic loss class. Because Mr. McCollins adequately represented
appellants’ interests when he argued for certification of the same class in the
District Court, Mr. Smith and Ms. Sperlazza are subject to the personal jurisdiction
of the District Court and are bound by the McCollins certification decision.
III. THE DISTRICT COURT DID NOT ABUSE ITS DISCRETION IN

ISSUING A PERMANENT INJUNCTION.
Finally, Mr. Smith and Ms. Sperlazza argue that the District Court
abused its discretion in enjoining them from relitigating class certification because
the claims of absent class members are small and can only be pursued through
44
class litigation. Smith Br. at 40-42. 17 In essence, appellants are claiming the right
to relitigate until they get a class certified.
Appellants have no such right. To the contrary, the relitigation
exception to the Anti-Injunction Act exists for the very purpose that appellants
now attempt to characterize as irreparable injury – to prevent a party from
relitigating a federal judgment in another court, in the hope of getting a different
result. See 28 U.S.C. § 2283. Mr. Smith and Ms. Sperlazza are making precisely
the “heads-I-win, tails-you-lose” argument that the Seventh Circuit rejected in In
re Bridgestone/Firestone:
Section 2283 permits a federal court to issue an injunction that will

stop [serial efforts to certify the same class] in its tracks and hold both
sides to a fully litigated outcome, rather than perpetuating an
asymmetric system in which class counsel can win but never lose.
333 F.3d at 767. This Court adopted the same reasoning in Canady and In re Piper
Aircraft. See Canady, 282 F.3d at 1018 (“What appellants may not do is recycle
the same claims and issues in different courts, hoping to achieve the result they
desire”); In re Piper Aircraft, 551 F.2d at 219 (plaintiffs “ought not to have
unlimited bites at the apple” seeking certification of a class).
17
As described above, McCollins rejected the argument that the small size of
economic loss claims supported certification of the putative class where the other
requirements for class certification were missing. See Smith Add. at A13-A14; see
also supra at 4.
45
The injunction issued here plainly fell within the scope of the District
Court’s discretion. The District Court carefully considered all of the factors
necessary for issuance of an injunction and concluded that Bayer had established
each of those factors.
More specifically, the Court concluded that Bayer had established
success on the merits by demonstrating that the McCollins order was entitled to
preclusive effect. See Smith Add. at A37. In finding that Bayer had demonstrated
irreparable injury, the District Court quoted this Court’s holding in Canady that “a
party suffers irreparable harm when it is required to relitigate . . . issues previously
decided in a federal court.” See id. (quoting Canady, 282 F.3d at 1020). The
District Court also quoted Canady in concluding that the balance of harms favored
issuance of an injunction because “[t]he deprivation of an opportunity to pursue the
same issues in [another] forum does not constitute a legitimate harm.” Id. (quoting
Canady, 282 F.3d at 1020). Finally, the District Court determined that the public
interest favored issuance of an injunction to promote judicial economy and protect
against duplicative litigation. See id. at A38 (citing In re SDDS, Inc., 97 F.3d
1030, 1041 (8th Cir. 1996)). The District Court then carefully tailored the
injunction, barring Mr. Smith and Ms. Sperlazza only from relitigating the West
Virginia economic loss class; neither they nor any other member of the McCollins
putative class was enjoined from pursuing individual claims. See id. Thus,
46
issuance of the injunction was a proper exercise of the District Court’s discretion
and fully consistent with the precedents of this Court.
In enjoining Mr. Smith and Ms. Sperlazza, the District Court
recognized that issuance of such an injunction is an extraordinary remedy and that
such injunctions should be granted sparingly. See id. at A36-A37. The injunction
here arises from unusual circumstances unlikely to recur. Putative class actions
like Smith now can be removed to federal court (see Class Action Fairness Act of
2005, Pub. L. No. 109-2, 119 Stat. 4), dramatically reducing the risk of duplicative
litigation. Moreover, state court plaintiffs generally do not wait until seven years
into litigation – when the overwhelming majority of cases has been resolved – to
seek class certification.
The potential harm to Bayer and to the integrity of the judicial system
is particularly acute here. Mr. Smith and Ms. Sperlazza’s certification motion
apparently seeks to pressure Bayer into a thirteenth hour settlement of no-injury
claims. 18 For the last seven years, Bayer has refused to settle those claims and has
channeled its resources to settling the claims of the people who actually suffered
the side effect that led to the withdrawal of Baycol – even though Bayer continues
to contest liability and has won each of the six Baycol jury trials. This settlement
18
See Castano, 84 F.3d at 746 (“In addition to skewing trial outcomes, class
certification creates insurmountable pressure on defendants to settle”); In re
Rhone-Poulenc Rorer Inc., 51 F.3d 1293, 1298 (7th Cir.), cert. denied 516 U.S.
867 (1995) (same).
47
program has led to the resolution of thousands of cases and payments to injured
plaintiffs of more than one billion dollars. See supra at 9-10. As the Baycol MDL
court, the District Court has overseen this settlement program to assure that it was
fairly and consistently administered for state and federal court cases. Now that
most plaintiffs’ cases have been resolved in reliance on the scope of this settlement
program, Mr. Smith and Ms. Sperlazza want to force Bayer to redirect its resources
to putative class members who suffered no side effects and who in fact benefited
from the medicine.
The District Court, having presided over the Baycol MDL since late
2001, was well-positioned to discern the balance of harms resulting from
relitigation of a class certification already fully and fairly adjudicated in federal
court. The District Court did not abuse its discretion determining that the balance
of harms weighed in favor of issuing a permanent injunction barring relitigation of
the putative class denied certification in McCollins.
* * *
In sum, the District Court appropriately issued a permanent injunction
barring Mr. Smith and Ms. Sperlazza from pursuing class certification in West
Virginia state court. Upon a finding that the relitigation exception to the Anti-
Injunction Act applied and that the Court had the authority under the All Writs Act
to issue an injunction enjoining the relitigation, the District Court crafted a
48
narrowly tailored injunction targeted to protect and effectuate its final judgment
denying class certification in the McCollins case. The Court should affirm the
District Court’s order.
CONCLUSION
For the foregoing reasons, Bayer Corporation respectfully requests
that the District Court’s order be affirmed.
Respectfully submitted,
/s/ Philip S. Beck

Philip S. Beck
Adam L. Hoeflich
Katherine G. Minarik
BARTLIT BECK HERMAN PALENCHAR &
SCOTT LLP
54 West Hubbard Street, Suite 300
Chicago, IL 60610
Tel: (312) 494-4400
philip.beck@bartlit-beck.com
adam.hoeflich@bartlit-beck.com
katherine.minarik@bartlit-beck.com
Susan A. Weber
James W. Mizgala
James R.M. Hemmings
SIDLEY AUSTIN LLP
1 South Dearborn Street
Chicago, IL 60603
Tel: (312) 853-7000
saweber@sidley.com
jmizgala@sidley.com
jhemmings@sidley.com
49
Peter W. Sipkins
DORSEY & WHITNEY LLP
50 South Sixth Street, Suite 1500
Minneapolis, MN 55402
Tel: (612) 340-2600
sipkins.peter@dorsey.com
Counsel for Defendant-Appellee

Bayer Corporation
50
CERTIFICATE OF COMPLIANCE WITH RULE 32(a)
1. This brief complies with the type-volume limitation of Fed. R. App. P.
32(a)(7)(B) because:
this brief contains 11,666 words, excluding parts of the brief
exempted by Fed. R. App. P. 32(a)(7)(B)(iii).
2. This brief complies with the typeface requirements of Fed. R. App. P.
32(a)(5) and the type-style requirements of Fed. R. App. P. 32(a)(6) because:
this brief has been prepared in a proportionally spaced typeface using
Microsoft Office Word 2003 in 14-point Times New Roman font.
/s/ Philip S. Beck

Philip S. Beck

Bayer Corporation
51
CERTIFICATE OF COMPLIANCE WITH RULE 28A(d)(2)
I hereby certify that the PDF file containing the digital version of this
brief furnished to the Court on a CD-ROM has been scanned for viruses and is
virus-free.
/s/ Philip S. Beck

Philip S. Beck

Bayer Corporation
52
CERTIFICATE OF SERVICE
I hereby certify that on April 2, 2009, I caused to be sent two copies
of the Answer Brief of Appellee Bayer Corporation, one copy of the digital version
of the Answer Brief of Appellee Bayer Corporation, and one copy of the Separate
Appendix of Defendant-Appellee, by overnight mail, postage prepaid, to:
Richard A. Monahan
Marvin W. Masters
Charles M. Love, IV
THE MASTERS LAW FIRM LC
181 Summers Street
Charleston, West Virginia 25301
Counsel for Appellants
Dated: April 2, 2009 /s/ Philip S. Beck

Philip S. Beck

Bayer Corporation
CH1 4621934v.11
53

In Re: Baycol Products Litigation: Plaintiffs, Respondents-Appellants

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In Re: Baycol Products Litigation: Plaintiffs, Respondents-Appellants

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Case: 09-1069 Page: 1 Date Filed: 04/03/2009 Entry ID: 3533707

IN THE UNITED STATES COURT OF APPEALS

IN RE: BAYCOL PRODUCTS LITIGATION

PEGGY ANN MAYS, GEORGE F. MCCOLLINS,

BAYER CORPORATION, a foreign corporation,

BRIEF OF DEFENDANT-APPELLEE BAYER CORPORATION

Philip S. Beck Susan A. Weber Peter W. Sipkins

Counsel for Defendant-Appellee Bayer Corporation

SUMMARY AND STATEMENT REGARDING ORAL ARGUMENT

The issue in this appeal is whether adequately represented members of

certification by seeking certification of an identical class in state court. The United

McCollins. Appellants Keith Smith and Shirley Sperlazza, members of the

This Court should affirm that injunction. Appellants seek to relitigate

certification of the identical class that was denied certification in McCollins. As

adequately represented members of the putative McCollins class, appellants are

Mr. Smith and Ms. Sperlazza from seeking class certification.

Bayer respectfully suggests that oral argument of 15 minutes per side

CORPORATE DISCLOSURE STATEMENT

Corporation certifies that:

Bayer Corporation is a nongovernmental corporation. Bayer

Corporation is wholly owned by Bayer AG.

/s/ Philip S. Beck

Counsel for Appellee

Dated: April 2, 2009

Summary and Statement Regarding Oral Argument .................................................i

Corporate Disclosure Statement ............................................................................... ii

Table of Contents ..................................................................................................... iii

Table of Authorities ...................................................................................................v

Responsive Jurisdictional Statement .........................................................................5

Counter-Statement of the Issues ................................................................................6

Responsive Statement of the Case and of the Facts ..................................................7

II. The Baycol MDL .....................................................................................9

III. McCollins v. Bayer Corp. ......................................................................11

IV. Smith v. Bayer Corp. .............................................................................13

Summary of the Argument.......................................................................................16

I. Contrary to Appellants’ “Federalism” Argument, the

II. The District Court Had the Authority and Jurisdiction

A. Mr. Smith and Ms. Sperlazza Seek to Relitigate the

B. The Denial of Class Certification in McCollins Is a

C. Because Appellants’ Interests Were Fully and Adequately

1. Mr. McCollins Adequately Represented the

2. The “Adequacy of Representation” Standard

a. Appellants Cannot Evade the McCollins

b. Due Process Does Not Impose Notice and

c. The Prohibition on “Virtual Representation”

Certificate of Compliance with Rule 32(a)..............................................................51

Certificate of Compliance with Rule 28A(d)(2) ......................................................52

Certificate of Service ...............................................................................................53

Amchem Prods., Inc. v. Windsor, 521 U.S. 591 (1997) .....................4,7,32,35,42

American Pipe & Construction Co. v. Utah,

Axcan Scandipharm Inc. v. Ethex Corp., 585 F. Supp. 2d 1067

Canady v. Allstate Ins. Co., 282 F.3d 1005

Devlin v. Scardelletti, 536 U.S. 1 (2002) ...........................................................38

Eisen v. Carlisle & Jacquelin, 417 U.S. 156 (1974) .........................................41

Goff v. Menke, 672 F.2d 702 (8th Cir. 1982) .....................................................28

In re BankAmerica Corp. Securities Litig., 263 F.3d 795

In re Baycol Prods. Liab. Litig., 532 F. Supp. 2d 1029

In re Baycol Prods. Liab. Litig., 321 F. Supp. 2d 1118

In re Baycol Prods. Liab. Litig., No. 1431, 2001 WL 34134820

In re Bridgestone/Firestone, Inc. Tires Prod. Liab. Litig.,

In re Dalkon Shield Punitive Damages Litig., 613 F. Supp. 1112

In re General Motors Corp. Pick-Up Truck Fuel Tank Prod.