Williams v. Bristol-Myers Squibb Company
- Jesse Furman
- 1:21-cv-09998
- U.S. District Court · Southern District of New York
- 6
In Williams v. Bristol-Myers Squibb, Judge Furman remanded Tara Williams’s Securities Act class action because CAFA did not provide federal jurisdiction.
Tara Williams and the proposed class, Bristol-Myers Squibb Company, and the company’s directors and officers are affected because the case was returned to New York Supreme Court rather than proceeding in federal court. The opinion did not resolve the underlying securities allegations.
What happened
In Williams v. Bristol-Myers Squibb Company, Tara Williams brought a proposed class action claiming that Bristol-Myers Squibb Company and several directors and officers filed a false or misleading registration statement concerning publicly traded contingent value rights. Bristol-Myers Squibb removed the case from New York state court to federal court under the Class Action Fairness Act.
Williams asked the federal court to send the case back to state court. The court held that the Class Action Fairness Act excludes class actions involving claims about certain publicly traded securities, and the contingent value rights in this case qualified. Because that was the only basis for federal jurisdiction, the court remanded the case to New York Supreme Court, terminated the remand motion, and closed the federal case.
Judge Jesse M. Furman did not decide whether the registration statement was actually false or misleading. His ruling addressed only whether the case could remain in federal court and ordered its return to state court.
The detailed version
- Williams v. Bristol-Myers Squibb Company · No. 1:21-cv-09998
- Jesse Furman
- Sept. 19, 2022
Background
Tara Williams filed a proposed class action against Bristol-Myers Squibb Company and several of its directors and officers. She alleged that a registration statement filed in connection with certain contingent value rights was false and misleading, violating the Securities Act of 1933. Williams initially filed the case in New York state court. Bristol-Myers Squibb removed it to the U.S. District Court for the Southern District of New York, relying on federal jurisdiction under the Class Action Fairness Act.
Motion to Remand
Williams moved under 28 U.S.C. § 1447(c) to remand, meaning to return, the case to state court. She argued that the Securities Act generally bars removal of cases arising under that Act.
The court focused instead on the Class Action Fairness Act. Although the case met the general requirements for class-action jurisdiction under 28 U.S.C. § 1332(d)(2), another provision excludes from that jurisdiction any class action that solely involves claims concerning a covered security. The court explained that a covered security generally includes a security listed, or authorized for listing, on a national securities exchange. The contingent value rights at issue were publicly traded on the New York Stock Exchange, so the court held that the exception applied.
The court rejected the defendants’ argument that the exception should be limited to certain state-law securities claims. It found the statutory language unambiguous and therefore declined to use legislative history to adopt a narrower interpretation. The court also found that the cases cited by the defendants either involved securities that were not covered securities, involved claims beyond those concerning covered securities, or did not decide the issue presented here.
Disposition
The court held that the Class Action Fairness Act did not provide federal subject-matter jurisdiction over this case and that this was the only basis for removal. The court remanded the case to New York Supreme Court, directed the Clerk to terminate the remand motion, and closed the federal case. The opinion did not decide the merits of Williams’s allegations concerning the registration statement. Williams did not seek attorney fees or costs related to the removal.
Read the full 6-page opinion on CourtListener, the free public archive maintained by the Free Law Project.