Ebel - Affirmed

A little more than a year ago, we blogged about Ebel v. Eli Lilly & Co., 536 F. Supp.2d 767 (S.D. Tex. 2008), which granted summary judgment in a suicide case involving off-label use of Zyprexa, primarily on warning causation grounds - but as we posted then, the plaintiff had seven strikes against him.

Well, yesterday the Fifth Circuit affirmed. With so many strikes against the plaintiff, the affirmance was not for publication, but if you're preparing for a treater deposition and want to see what really good "I already knew" non-causation testimony looks like - and can do - this opinion is worth a gander. Ebel's discussion of the burden of proof is also worth noting, because the court rejects the contention that the learned intermediary rule is an affirmative defense as to which the defendant, rather than the plaintiff, had the obligation to prove. Slip op. at 11-12. The court also rejects the "read and heed" presumption under Texas law. Id. at 12 n.5, 14.

Reading Ebel, we have to shake our heads over what some plaintiffs are willing to argue these days. That the plaintiff (seeking to take the defendant's money, and thus change the status quo) has to prove the elements of his/her cause of action is a proposition as old as tort law itself. But Ebel argued that requiring her to prove causation was “completely inimical to Texas products liability law.” Slip op. at 12. Needless to say, the court rejected that position, id., ("indeed, it is required by Texas law"), but one wonders what a litigant has to argue before a court concludes "frivolous" and imposes sanctions.

The court also gives a slightly different twist to causation. In Ebel it was readily apparent that the decedent needed some kind of treatment for his condition (severe headaches). He had gone through dozens of other drugs without success, and off-label Zyprexa was sort of a last resort. In those circumstances, it was not a viable argument simply to say that the doctor, or the patient, might not have prescribed/used this drug had there been an "adequate" warning. Rather, the plaintiff had to show that there was some sort of alternative available:

[Plaintiff] presented no evidence to suggest that [the prescriber] would have changed either his decision to prescribe Zyprexa or his risk–benefit analysis had he received some alternative warning concerning Zyprexa. Indeed, the record indicates that Zyprexa was perceived to be the last remaining treatment option available to [the decedent] after he had tried upwards of forty-five other medications to no avail.... [Plaintiff] has produced no evidence demonstrating that [the prescriber] would have prescribed anything other than Zyprexa at that time. For these reasons, [plaintiff] has failed to show that a genuine issue of material fact exists as to whether [defendant's] warning was the producing cause of [the decedent's] death.

Slip op. at 14. There aren't many cases out there that explore the need for the plaintiff to establish an available alternative therapy as part of the burden of proving causation, so even though Ebel is (regrettably) unpublished, we recommend it particularly on this point.

Another Look At Some Recent Scholarship

We see all these fascinating law review articles appear in print, and we plan to read the articles and react intelligently to them.

Then life gets in the way.


Instead of actually reading the things, we pile a bunch of 'em up on our desks and then give up. Instead of publishing an intelligent blog post, we simply alert the world that the new stuff is out there.

So that's our confession, and that's what we're doing here, again:


We liked the abstract of "The Quasi-Class Action Method of Managing Multidistrict Litigations: Problems and a Proposal," posted at SSRN by Charles Silver and Geoffrey Miller. Here's a link to the abstract (and, in turn, the entire article), and here's the entire text of the abstract:


"This article uses three recent multi-district litigations (MDLs) that produced massive settlements - Guidant ($240 million), Vioxx ($4.85 billion), and Zyprexa ($700 million) - to study the emerging quasi-class action approach to MDL management. The approach has four components: (1) judicial selection of lead attorneys; (2) judicial control of lead attorneys' compensation; (3) forced fee transfers from non-lead lawyers to cover lead attorneys' fees; and (4) judicial reduction of non-lead lawyers' fees to save claimants money. These widely used procedures have serious downsides. They make lawyers financially dependent on judges and, therefore, loyal to judges rather than clients. They compromise judges' independence by involving them heavily on the plaintiffs' side and making them responsible for plaintiffs' success. They allocate monies in ways that likely over-compensate some attorneys and under-pay others, with predictable impacts on service levels. They also lack needed grounding in substantive law because the common fund doctrine, which supports fee awards in class actions, does not apply in MDLs. Academics have not previously noted these shortcomings; this is the first scholarly assessment of the quasi-class action approach.


"This article also proposes an alternative method of MDL management. It recommends the creation a plaintiffs' management committee (PMC) composed of the attorney or attorney-group with the most valuable client inventory, as determined objectively by the trial judge. The PMC, which would have a large interest in the success of an MDL, would then select and retain other lawyers to perform common benefit work (CBW) for all claimants and monitor the lawyers' performance. The new approach would thus use micro-incentives to organize the production of CBW in MDLs rather than judicial control and oversight. The court would stand back from the process, exercising only a limited backup authority to prevent abuses. If enacted as a statute, the proposal would restore judges' independence, preserve lawyers' loyalties, provide the requisite legal foundation for fee awards, and encourage the fairer, more efficient, and more appropriate representation of claimants in MDLs."


We also like the sound of Richard Nagareda's recent piece, "Aggregate Litigation Across the Atlantic and the Future of American Exceptionalism." Again, here's a link to the abstract (which will take you to the full text of the article in the January 2009 issue of the Vanderbilt Law Review), and here's what the abstract tells us:


"This article analyzes the emerging phenomenon of trans-Atlantic civil litigation on an aggregate basis - chiefly, though not exclusively, by way of class actions. European systems have shown a growing receptiveness for aggregate litigation, but treatments of this development have consisted largely of description. This article offers an analytical framework with which to anticipate the structural dynamics of transnational aggregate litigation in the twenty-first century.


"Simply put, these structural dynamics will tend to recreate the difficulties seen in the context of nationwide class action litigation within the United States. The nationalization of US commerce led to aggregate litigation of a commensurately national scope. The result, however, was regulatory mismatch - for the scope of aggregation to expand to match the scope of the disputed nationwide activity, rather than the jurisdictional sovereignty of the forum. The globalization of commerce, coupled with the very multiplicity of approaches to aggregate litigation seen today, has a considerable tendency to replicate these mismatches - now, with international proportions. The recent Vivendi securities class action in the United States and the pathbreaking Royal Dutch Shell settlement under the 2005 Dutch collective settlement act confirm this trend.


"The article then analyzes the vehicles by which to address regulatory mismatches. Here, too, the US experience is instructive, underscoring both the centrality and the limitations of the two vehicles by which to achieve a kind of de facto, informal governance: the principles for transnational claim preclusion and the latitude available for private contracts to shift disputes from litigation to arbitration."


Finally, we're mighty tempted by Thomas Colby's forthcoming piece in the Yale Law Journal, "Clearing the Smoke From Philip Morris v. Williams: The Past, Present, and Future of Punitive Damages." Here's the link to SSRN, and here's what the abstract tells us:


"In Philip Morris v. Williams, the Supreme Court held that the Constitution does not permit the imposition of punitive damages to punish a defendant for harm caused to third parties. This Article critiques the reasoning, but seeks ultimately to vindicate the result, of this landmark decision. It argues that, although the Court's procedural due process analysis does not stand up to scrutiny, punitive damages as punishment for third-party harm do indeed violate procedural due process, but for reasons far more profound than those offered by the Court. To reach that conclusion, the Article confronts the most basic and fundamental questions about punitive damages - questions that the Supreme Court has studiously avoided for more than a century: what, exactly, is the purpose of punitive damages, and how is it constitutional to impose them as a form of punishment in a judicial proceeding without affording the defendant the protection of the Constitution's criminal procedural safeguards?


"The Article argues that punitive damages are properly conceived of a form of punishment for private wrongs: judicially sanctioned private revenge. As such, the Article explains, it makes both theoretical and doctrinal sense to impose them without affording the defendant criminal procedural protections, which are necessitated only for the punishment of public wrongs on behalf of society. When, however, courts employ punitive damages as a form of punishment for public wrongs, they become a substitute for the criminal law and thus make an intolerable end run around the Bill of Rights. For that reason, Williams was ultimately correct that punitive damages must be limited to punishment for the harm done to the individual plaintiff, not the harm done to the general public.


"The Article concludes by considering the future of punitive damages in light of the Williams decision. It concludes that, contrary to the emerging conventional wisdom, Williams does not stand in the way of the imposition of substantial extra-compensatory damages of the type favored by law and economics scholars as a means of forcing the defendant to internalize the costs of its behavior in order to achieve optimal deterrence. It is the fact that punitive damages punish, and that they do so in order to vindicate the interests of the state, that precludes their use to address third-party harms. Once the element of punishment is eliminated from the remedy, the constitutional infirmity at issue in Williams is ameliorated."


As we said, this all sound like good stuff.


And we'll read these puppies in their entirety any day now; perhaps starting on the days we retire.

Tuna That Tastes Good: Tri-Union Seafoods

We don't do food; we do drugs.

(Does that sound bad?)

We veered off into food to read The People ex rel. Edmund G. Brown, Jr. v. Tri-Union Seafoods, LLC, No. A116792, 2009 Cal. App. LEXIS 309 (Cal. App. Mar. 11, 2009), a California Proposition 65 case. Tri-Union involved a lawsuit brought by the State of California to require producers of canned tuna to warn pregnant women that they are exposed to methylmercury when they consume canned tuna.

After a six-week bench trial, the court said, "Sorry, Charlie," ruling that the State was not entitled to any of the relief it requested. The trial court rested its decision on three separate grounds: (1) Prop 65, as it applied to the tuna companies, was preempted by federal law, (2) the amount of methylmercury in canned tuna doesn't rise to the threshold level that would trigger a warning requirement, and (3) virtually all methylmercury is "naturally occurring," and thus doesn't count toward the threshold exposure.

We were hoping for a decision on the preemption issue, but the court disappointed us. The First District Court of Appeal affirmed the trial court judgment solely on the ground that there was substantial evidence to support the decision that virtually all methylmercury is naturally occurring. Given that holding, the appellate court didn't have to reach the other issues.

We overcame our disappointment about not reading a preemption case when we reached the following language, suggesting that courts consider appointing expert panels to help resolve complex scientific questions:

"It bears contemplating, however, whether the truth about complex, threshold scientific issues encompassed within Proposition 65 -- such as whether methylmercury in fish is naturally occurring -- is best derived by application of the substantial evidence rule to the testimony and opinions of dueling experts serving under partisan commitments. . . . More than a century ago our Supreme Court proposed that rather than relying on expert witnesses called by the parties, the trial courts should summon a disinterested body or board of experts to give their opinion and reasons therefore to the court and jury regardless of the consequences to either litigant. . .. Our Evidence Code now provides for a similar remedy, authorizing courts to appoint experts to investigate and render a report on the matter in question, subject to cross-examination by the parties. . . . Resort to such a procedure could reduce the risk of a decision based on anything but the most valid scientific investigation and assessment."

Id. at *45-46.

In appropriate circumstances, we're all in favor of convening expert panels to help guide factfinders. We'll tuck this precedent in a file, and we'll use it when the right time comes.

We hope you will, too.

Vaccine Act Preemption Affirmed in Bruesewitz

The Third Circuit has just affirmed summary judgment on grounds of express preemption under the Vaccine Act in Bruesewitz v. Wyeth, No. 07-3794, slip op. (3d Cir. March 27, 2009). Interpreting the statute's legislative history as demonstrating congressional intent to preempt sufficient to overcome any presumption against preemption, the court creates a split of authority by specifically disagreeing with the analysis of the Georgia Supreme Court in American Home Products Corp v. Ferrari, 668 S.E.2d 236 (Ga. 2008). Slip op. at 28, 29 ("We do not consider the Ferrari Court’s reading to be compelling"; "we think the Ferrari Court’s construction is contrary to the structure of the Act") (the 669 in the opinion's Ferrari cite is a typo).

With Ferrari currently before the Supreme Court on certiorari, the after-created direct split between the federal court of appeals and a state's highest court on a question of federal preemption raises the prospect of yet another High Court preemption battle regarding an FDA-approved product. That is, if the Court is willing to revisit preemption in the FDA context so soon after deciding three cases in a year.

Bruesewitz addresses and distinguishes Wyeth v. Levine as follows:

In Wyeth v. Levine, S. Ct. 8 , No. 06-1249, 2009 WL529172, at *1 (2009), the Supreme Court examined whether federal law preempted state tort claims alleging that a drug manufacturer failed to adequately warn of the dangers associated with a drug. Id. at *1. Though we recognize that the Supreme Court concluded that state tort law claims were not preempted in that case, id. at 13, Levine is readily distinguishable on several grounds. First, the Court explicitly noted the absence of an express preemption provision and found Congress’s silence, “coupled with its certain awareness of the prevalence of state tort litigation, [] powerful evidence.” Id. at 10. In this case, however, Congress included an express preemption provision that was prompted, as evidenced by the Committee Report, by the prevalence of state tort litigation. Second, it recognized that, under federal law, a drug manufacturer could strengthen a drug's label without preapproval from the FDA. Id. at 7. This stands in contrast to the FDA’s far-more extensive control and oversight of the approval of a drug’s design and alteration.

Slip op. at 30-31 n.8.

The court, examining the history of Vaccine Act, concluded that Congress intended to apply Restatement (Second) of Torts §402A, comment k (1965) across the board to bar all design defect claims, whether sounding in negligence or strict liability, against vaccines covered by the Act. Slip op. at 33-35. An attempt by a committee of a later congress to undercut preemption was rejected. Slip op. at 36-40.

For additional information on Vaccine Act preemption, the Washington Legal Foundation, recently released an interesting "Legal Backgrounder."

"Fun" Friday: Academic Earth

We're veering way off topic here.

And we recognize that you have to share our perverse concept of "fun" to appreciate the website that we're about to recommend. (Remember: In an odd way, we've thought it was "fun" to publish these 834 blog posts over the course of the last 2 1/2 years.)

But Academic Earth is a great, fun website. It contains "thousands of video lectures from the world's top scholars." Care to hear Professor Alan Blinder of Princeton on the "Origins of the Financial Mess"? It's there. Professor Mahran Sahami of Stanford on "The History of Computing"? It's there. And so are many, many others.

So that's what's there.

If, on the other hand, you're ready to settle for Beck and Herrmann on Drug and Device Law . . . well, you know where to find that, too.

Back to that subject shortly.

New Drug/Vaccine Preemption Scorecard

It was inevitable, we guess. Just as we ended up creating a new express preemption scorecard for medical devices after Riegel, we've decided to do the same with the drug/vaccine preemption after Wyeth v. Levine (yes, we know Levine doesn't address vaccines, but since we have to change one, we'll change them both).

It's basically the same as our other scorecards. It will be in chronological order after Levine, and we'll mention the drug, the basic result, pro or con, as well as the nature of the claims involved, to the extent they differ from Levine.

1. Smith v. Wyeth, 2009 WL 736208 (W.D. Ky. March 4, 2009), minute order reaffirming in light of Levine prior decision (2008 WL 4697002, reconsideration denied, 2009 WL 425032) (see prior scorecard) finding broad preemption of warning claims in case involving generic Reglan; entering final judgment (3/20/09) to permit immediate appellate review. An appeal (No. 09-5460) is pending in the Sixth Circuit.
2. Morris v. Wyeth, 2009 WL 736200 (W.D. Ky. March 4, 2009), minute order reaffirming in light of Levine prior decision (582 F.Supp.2d 861, reconsideration denied, 642 F. Supp.2d 677) (see prior scorecard) finding broad preemption of warning claims in case involving generic Reglan; entering final judgment (3/20/09) to permit immediate appellate review. An appeal (No. 09-5509) is pending in the Sixth Circuit
3. Wilson v. Wyeth, Inc., 2009 WL 736198 (W.D. Ky. March 5, 2009), minute order reaffirming in light of Levine prior decision (2008 WL 4696995, reconsideration denied, 2009 WL 425027) (see prior scorecard) finding broad preemption of warning claims in case involving generic Reglan; entering final judgment (3/20/09) to permit immediate appellate review. An appeal (No. 09-5466) is pending in the Sixth Circuit
4. Schrock v. Wyeth Inc., 601 F. Supp.2d 1262 (W.D. Okla. March 11, 2009), reconsideration denied (May 22, 2009), finding no preemption of warning claims in case involving generic Reglan. Considering defendant's arguments "similar, if not identical," to those rejected in Levine.
5. Stacel v. Teva Pharmaceuticals, USA, 620 F. Supp.2d 899 (N.D. Ill. March 16, 2009), finding no preemption of warning claims in case involving generic Minocin. While generics are distinguishable, the court rejects the FDA's position that generic manufacturers could not modify warnings via CBE process.
6. Longs v. Wyeth, 621 F. Supp.2d 504 (N.D. Ohio March 20, 2009), preemption recognized upon reconsideration (see prior scorecard) in fen-phen case of claim that the drug "was an ‘unreasonably dangerous’ drug for which no warning would have been adequate. This is a final order. An appeal (No. 09-3380) is pending in the Sixth Circuit.
7. Bruesewitz v. Wyeth, 561 F.3d 233 (3d Cir. March 27, 2009), express preemption affirmed (see prior scorecard) under Vaccine Act of design and warning claims in case involving DTP vaccine to infant.
8. Kellogg v. Wyeth, 612 F. Supp.2d 437 (D. Vt. April 10, 2009), denying motion for interlocutory appeal of pre-Levine ruling finding (see prior scorecard) no preemption of warning claims in case involving generic Reglan. While generics are distinguishable, the court concludes that Levine supports its prior ruling.
9. Brockert v. Wyeth Pharmaceuticals, Inc., 287 S.W.3d 760 (Tex. App. April 14, 2009), reversing pre-Levine preemption ruling (see prior scorecard) in HRT litigation after the defendant withdrew its preemption argument in light of Levine. Plaintiff argued for warnings that the FDA later adopted.
10. Myers-Armstrong v. Actavis Totowa LLC, 2009 WL 1082026 (N.D. Cal. April 22, 2009), no obstacle preemption of refund claim where FDA recalled drug on wholesale level but not retail level. There was no FDA conclusion that the recalled drug was actually safe.
11. Forst v. SmithKline Beecham Corp., 2009 WL 2256232, slip op. (E.D. Wisc. July 29, 2009), no obstacle or impossibility preemption in SSRI (Paxil) adult suicide case.
12. Bartlett v. Mutual Pharmaceutical Co., ___ F. Supp.2d ___, 2009 WL 3126305, slip op. (D.N.H. Sept. 30, 2009), finding no preemption of warning claims in case involving generic Sulindac. The generic preemption argument has no effect upon non-warning claims. Nothing in the FDCA prohibits generic manufacturers from post-approval modifications of their warnings, through the CBE process or otherwise. No deference granted to various FDA statements. Even if dissimilar labeling were a violation, the FDA has never taken enforcement action in such circumstances. There is no evidence of congressional intent to preempt state tort law as a means of lowering the cost of generic drugs.
13. Munroe v. Barr Laboratories, Inc., ___ F. Supp.2d ___, 2009 WL 4047949 (N.D. Fla. Oct. 15, 2009), finding no preemption of warning claims in case involving generic Adderall. Generic manufacturers may use the CBE process. Generic manufacturers are subject to the same liability as pioneer manufacturers.
14. In re: Aredia And Zometa Products Liability Litigation, ___ Fed. Appx. ___, 2009 WL 4072074 (6th Cir. Nov. 24, 2009), affirming preemption (see prior scorecard) of fraud-on-the-FDA exception to Michigan tort reform statute. Preemption applies to all claims alleging fraud on the FDA, including post-approval fraud and fraud asserted against an affirmative defense.
15. Gaeta v. Perrigo Pharmaceuticals Co., No. C 05-04115 JW, slip op. (N.D. Cal. Nov. 24, 2009), refusing reconsideration of order (562 F. Supp.2d 1091, see prior scorecard) holding that implied preemption bars warning claims in case involving generic ibuprofen. Levine did not address generic drug preemption and the requirement that generic drug warnings be the "same" precludes resort to the CBE process that was dispositive in Levine. This is a final judgment and there will be an appeal.
16. Mensing v. Wyeth, Inc., ___ F.3d ___, 2009 WL 4111209 , slip op. (8th Cir. Nov. 27, 2009), finding no preemption of warning claims in case involving generic metoclopramide. Regardless of CBE requirements the common law could impose a duty upon generic drug manufacturers to alert the FDA and to seek a stronger warning for both generic and brand name labeling or to have the agency issue a "Dear Doctor" letter, in light of evolving knowledge. Nothing in Hatch-Waxman evinces a congressional intent to preempt state law.

Colacicco Briefing Slightly Postponed

The Third Circuit entered this order today in Colacicco v. Apotex:

"The foregoing motion by Appellee Beth Ann McNellis and unopposed request by Appellant Colacicco for a 15-day extension of time to file memoranda until April 16, 2009 is granted. Opposing counsel may file their responses on or before April 30, 2009."

The plaintiffs-side briefs will thus be filed and served on April 16, rather than April 1, as originally ordered.

Calabresi On Preemption

Judge (and former Yale Law School Dean) Guido Calabresi gave the keynote speech last month at NYU Law School's symposium on "Tort Law in the Shadow of Agency Preemption."

We don't want to steal his thunder. We assume (but don't know) that Calabresi's talk may be published in next year's symposium issue of the Annual Survey of American Law.

But we thought the speech was pretty interesting, so we're going to share a couple of ideas from it here.

The two of us typically think about preemption from deep in the trenches. We have a drug company client; the plaintiff claims a certain injury; we're working with a specific package insert, administrative history of interactions with the FDA, and a governing body of case law. Is there an argument that the plaintiff's claim is preempted?

End of thinking.

Judge Calabresi steps way back from the trenches. (Maybe that's why Calabresi's a judge and former dean, while your humble scribes are just . . . well, humble scribes.)

Anyway, Calabresi noted several choices that are implicit in any discussion of preemption as a policy issue. (Most of what follows are Calabresi's ideas. But we were jotting down our own reactions as we listened to the talk, and now we can't separate the two, so there may be a few of our ideas mixed in with Calabresi's in the following discussion. Needless to say, whatever's correct is probably what Calabresi said; we surely came up with the errors on our own.)

1. Who should bear the cost of error in the drug regulatory process? For example: Should the user harmed by a prematurely approved drug bear the cost, or should the non-user harmed by an improperly delayed drug? The user of a drug that contained too few warnings, or the non-user of a drug that contained too many?

Whatever choice society makes, there are distributional consequences, because different people will bear the costs.

2. The choice between "national" and "local" regulation is not necessarily a choice between the national Food and Drug Administration and juries applying varying state laws. Society could, if it cared to, have mini-FDA's (at the state or local level) that regulated drugs or, on the other hand, a single national body of product liability law.

3. The choice between "expert" and "lay" regulation is also not necessarily a choice between the FDA and lay juries. Society could, if it cared to, create regulatory agencies run by laymen or, more likely, empanel blue ribbon juries consisting entirely of experts in a field.

4. What institution should set minimum and maximum regulatory standards? If government sets the maximum standard ("no warnings beyond these may be given;" "no treatment beyond X may be provided"), then the government is deciding who lives and who dies -- what can be done to save a life. Perhaps it's dangerous for federal agencies to assign values to human lives. Or perhaps it's unseemly to require juries to assign values to human lives. Either way, this is a policy choice.

5. Should regulations be set before the fact (ex ante) or after the fact (ex post)? Regulatory agencies set standards in advance that companies must then follow. Tort law regulates from an after-the-fact perspective (no matter what the substantive tort rules are). The choice between ex ante and ex post regulation is a policy choice.

Calabresi had a bunch of other ideas, too. But, as we said, we really don't want to steal his thunder. (First, that would be wrong. And, second, we're not in the business of ticking off Second Circuit judges.)

So ponder the few thoughts that we've shared above, but be sure to look at the symposium issue of the Annual Survey of American Law next year to read Calabresi's own words on this subject.

Colacicco Update - briefs due 4/1

Entry on Third Circuit's docket, dated 3/18:

CLERK'S LETTER to counsel written at the direction of the Court. You are undoubtedly aware that the United States Supreme Court has remanded the above matter to this Court for further consideration in light of its opinion in Wyeth v. Levine, 555U.S.___(2009). The Court requests counsel to file contemporaneous memoranda with respect to the effect of the decision in Wyeth on the Court's decision in the above matters. An original and three copies of this memorandum should be filed in the Clerk's Office on or before April 1, 2009 and should not exceed fifteen pages double-spaced.

Riegel Redux: Delaney v. Stryker Finds PMA Preemption

Sometimes, we try to be encyclopedic in our blog posts. Sometimes, we try to be funny. (Yeah, yeah: "Try" is the operative word.) Today, we're just being descriptive.

In Delaney v. Stryker Orthopedics, No. 08-03210 (DMC), 2009 U.S. Dist. LEXIS 16865 (D.N.J. Mar. 5, 2009), Delaney underwent hip replacement surgery with a hip prosthesis manufactured by the predecessor to Stryker. The ceramic femoral ball component later shattered and was replaced. The hip prosthesis had been approved through the premarket approval process.

Stryker moved to dismiss, and the trial court granted the motion in large part. As for claims of failure to warn, design defect, negligence and recklessness, and implied warranties, the court applied Riegel without hesitation. ""[T]he FDA imposed the same requirements regarding safety and effectiveness as were imposed on the Riegel device. As in Riegel, these claims are expressly preempted . . . . " Id. at *10.

The express warranty claim was a different matter. "Riegel did not specifically address preemption with regard to a claim for breach of an express warranty." Id. at *14. "[T]he absence of Supreme Court guidance means that the [earlier Third Circuit opinion in] Michael v. Shiley" controls. Id. Under Shiley, "express warranty claims based on FDA approved product packaging are not preempted by the'" Medical Device Amendments. Id. at *15. According to the court, it's thus theoretically possible for an express warranty claim to survive preemption in the Third Circuit.

Delaney had not, however, specified exactly what words constituted the purported warranty. Citing Bell Atlantic v. Twombley, the court required Delaney to replead his express warranty claim with more specificity. Id.

Delaney also pleaded manufacturing defect claims, but he didn't identify "a defect or a deviation from the FDA-reviewed . . . manufacturing specifications regarding the [device] implanted in him." The court thus dismissed the manufacturing defect claim. Id. at *19.

Finally, as the New Jersey Supreme Court held in Sinclair v. Merck, any claim under the New Jersey Consumer Fraud Act was subsumed under the New Jersey Products Liability Act. Id. at 20.

All of the counts were thus dismissed with prejudice, except for the express warranty claim, which Delaney can replead. (But he won't. We don't know anything about those hip implants or that package insert, but we'll bet the mortgage that there's no express warranty tucked in there.)

Although this post was purely descriptive, it's another nice arrow in the quiver of folks defending medical devices. Please put Delaney to good use.

Preemption Still Be-Longs After Levine

A little more than a year ago we posted about Longs v. Wyeth, 536 F. Supp.2d 843 (N.D. Ohio 2008), a fen-phen decision that, among other things, held preempted a claim that the drug in question was so dangerous that there was no adequate warning that could make it "safe" enough for state tort law. As we reported then:

It’s one thing to say that the warning was inadequate. . . . But it’s quite another thing to say that there isn’t any warning on the face of the earth that could make an FDA-approved drug “safe” under state law. That’s the same thing as saying that, as far as state law is concerned, notwithstanding the FDA’s approval, the defendant should never have sold the product.And for a state to tell the FDA that its approval should
never have happened – well, that’s preempted.

Well we're happy to report that last Friday, the same judge on reconsideration after Wyeth v. Levine, held that nothing had changed. Even after Levine, a claim (analogous to the failure-to-contraindicate claim that we thought Levine was about) is still preempted. It could hardly be otherwise if the FDA is to retain any real authority at all. In Longs v. Wyeth, No.: 1:03 CV 2042 (N.D. Ohio March 20, 2009), the court drew a distinction between "pre-approval" and "post-approval" tort claims and observed that Levine dealt with "the postmarketing phase [when] new risks emerge. Slip. op. at 5 (quoting Levine, 2009 WL 529172, at *12). The court accordingly held that the plaintiffs too-dangerous-for-warnings claim was still preempted:

The instant case is distinguishable from Wyeth as this case does not involve a failure to warn claim, which served as the basis for the Supreme Court’s determination. Furthermore, the court, in holding that a failure to warn claim is not preempted, focused on the fact that the claim arises out of the actions of the manufacturer post-FDA approval. The Court found that after the FDA approves a product for the market, manufacturers maintain a duty to update warning labels because of their superior knowledge of new risks concerning their products. This post-FDA approval duty is distinguishable from a manufacturer’s duty prior to approval by the FDA, a circumstance that the Court does not explicitly address. While Wyeth may stand for the proposition that post-FDA approval claims are [sic not?] preempted, it does not purport to hold that the same is true for pre-FDA approval claims. Thus, Plaintiff fails to demonstrate that this court erred in its holding that Plaintiff’s pre-FDA approval claims are preempted.

Slip op. at 7.

That distinction makes sense to us, particularly in light of what the Supreme Court did not decide in Levine, which was the failure-to-contraindicate claim. A claim that a drug cannot be made reasonably safe by warnings is a direct challenge to the power of the FDA to approve drugs in first place. The same thing goes for indications vs. contraindications. Since any new indication requires FDA approval (that's what the off-label use debate is all about), then a failure to contraindicate claim is the same thing - a direct challenge to the FDA's power to approve uses of drugs.

We think that the plaintiffs in Longs overreached even the broadest possible scope of the common law in Levine - we doubt they will be the last to do so.

The State-Of-The-Art Defense In Drug/Device Cases After Levine

A linchpin of the preemption analysis in Wyeth v. Levine, 2009 WL 529172 (U.S. March 4, 2009), was the Court’s discussion of the “changes being effected” regulation, id. at *7-8, which in turn depended on the existence of either “newly acquired information” or “new analyses of previously submitted data.” Id. at *7. Factually, there wasn’t much of a record, so the Court held, essentially, that the defendant hadn’t proven the negative – that an analysis of twenty “incidents” (we’d guess adverse drug experience reports, but the opinion doesn’t specify) wouldn’t have yielded “new” information upon which a CBE submission could have been based. Id. at *8 (“[defendant] could have analyzed the accumulating data and added a stronger warning”).

To us, all this emphasis on “newness” suggests the likelihood that state-of-the-art issues will see increased play in prescription drug product liability litigation after Levine. Since we’ve been blogging, the state-of-the-art defense in prescription drug litigation hasn’t been all that hot of a topic. In terms of recent cases, there’s been the Maryland high court decision in Gourdine v. Crews, 955 A.2d 769, 781 (Md. 2008), which discussed state-of-the-art issues as a reason for deciding that negligence and strict liability weren’t all that different, and the trial court decision in Totterdale v. Lederle Laboratories, 2008 WL 972657 (W. Va. Cir. March 19, 2008), which rejected some sort of weird duty to develop a safer design more quickly than the state of the art actually advanced. In short, not a whole lot on the subject recently.

That’s likely to change, so we thought we’d stay ahead of the curve and provide our readers with the lay of the land. The state-of-the-art defense isn’t a hard one to understand. It’s the rather self-evident proposition that a defendant shouldn’t be liable for not warning about something (usually, but not necessarily, a product risk) that hasn’t been discovered or invented yet. That’s straightforward enough, and as long as product liability cases were brought under the “reasonable man” standard of negligence, there wasn’t any significant dispute over this requirement. It wasn’t “reasonable” to expect a defendant to know the unknowable.

With the advent of strict liability, things changed, and there was a good deal of agitation – at least on the academic front – that strict liability wasn’t really “strict” if defendants could escape liability because science hadn’t yet discovered the causal link that the plaintiff was asserting. Some courts bought the argument in some circumstances, most frequently in asbestos cases. Where such rulings were broad enough, they tended to create legislative backlash, as happened in New Jersey. See N.J.S.A. 2A:58C-3a(1) (“state of the art” a complete defense).

Drugs have always been treated more carefully by the law than things that go clank, and courts have been very leery of tinkering with the state-of-the-art defense in a field so dependent upon advances in scientific knowledge as prescription drugs. State of the art was the issue that prompted the California Supreme Court essentially to exempt prescription drugs from strict liability in Brown v. Superior Court, 751 P.2d 470 (1988):

Thus far the courts have tended to hold the manufacturer to a high standard of care in preparing and testing drugs of unknown potentiality and in giving warning; but in the absence of evidence that this standard has not been met, they have refused to hold the maker liable for unforeseeable harm.

Id. at 479 (reaffirming state-of-the-art defense in design defect context).

For these same reasons of policy, we reject plaintiff’s assertion that a drug manufacturer should be held strictly liable for failure to warn of risks inherent in a drug even though it neither knew nor could have known by the application of scientific knowledge available at the time of distribution that the drug could produce the undesirable side effects suffered by the plaintiff.

Id. at 480.

There are lots of rationales for why drug companies (and device and vaccine makers, too) shouldn’t be liable for not warning about scientifically unknown risks or not using some design that hasn’t been invented yet. The Illinois Supreme Court, years ago, summed them up well: to “hold the manufacturer liable for failure to warn of a danger of which it would be impossible to know based on the present state of human knowledge would make the manufacturer the virtual insurer of the product.” Woodill v. Parke Davis & Co., 402 N.E.2d 194, 199 (Ill. 1980). A manufacturer is not required to be “clairvoyant,” but rather, its judgments are evaluated “as of the time the product is distributed to the plaintiff.” Toner v. Lederle Laboratories, 732 P.2d 297, 306 (Idaho 1987).

The thin judicial support for a hindsight approach to the duty to warn is easily explained. The goal of the law is to induce conduct that is capable of being performed. This goal is not advanced by imposing liability for failure to warn of risks that were not capable of being known.

Vassallo v. Baxter Healthcare Corp., 696 N.E.2d 909, 922-23 (Mass. 1998).

For all of these reasons, we believe that the state-of-the-art defense dovetails with the Supreme Court’s evaluation of the prerequisites for a CBE submission in Levine. If, at the relevant time, the warning in question would not have supported common-law liability under the state-of-the-art defense, then there’s no factual basis for a CBE submission under the relevant FDA regulation. Where a CBE submission is not possible under the facts, then that’s one route to the “clear evidence that the FDA would not have approved a [label] change” that Levine, 2009 WL 529172, at *9, stated would support preemption. The state of the art defense cases thus provide a well-established body of law, and a reasonably numerous collection of factual analogies for dealing with the knotty question of whether there was insufficient “new” information for the FDA to allow a CBE submission, and thus for the application of preemption.

Here are the state-of-the-art cases that we’re familiar with in our limited field of drug and medical device product liability litigation:

Alaska: Shanks v. Upjohn Co., 835 P.2d 1189, 1200 (Alaska 1992); Polley v. Ciba-Geigy Corp., 658 F.Supp. 420, 421 (D. Alaska 1987).

Arizona: Gaston v. Hunter, 588 P.2d 326, 340 (Ariz. App. 1978).

Arkansas: DeLuryea v. Winthrop Laboratories, 697 F.2d 222, 229 (8th Cir. 1983).

California: Carlin v. Superior Court, 920 P.2d 1347, 1350-51 (Cal. 1996); Brown v. Superior Court, 751 P.2d 470, 480-81 (Cal. 1988); Valentine v. Baxter Healthcare Corp., 81 Cal. Rptr.2d 252, 263 (Cal. App. 1999); Rosburg v. Minnesota Mining & Manufacturing Co., 226 Cal. Rptr. 299, 305-06 (Cal. App. 1986); Fogo v. Cutter Laboratories, Inc., 137 Cal. Rptr. 417, 422-23 (Cal. App. 1977); Carmichael v. Reitz, 95 Cal. Rptr. 381, 404 (Cal. App. 1971); In re Guidant Corp. Implantable Defibrillators Products Liability Litigation, 2007 WL 2023569, at *2 (D. Minn. July 6, 2007).

Colorado: Belle Bonfils Memorial Blood Bank v. Hansen, 665 P.2d 118, 123 (Colo. 1983).

Connecticut: Vitanza v. Upjohn Co., 778 A.2d 829, 836 (Conn. 2001); Tomer v. America Home Products Corp., 368 A.2d 35, 38 (Conn. 1976); LaMontagne v. E.I. Du Pont De Nemours & Co., 41 F.3d 846, 859 (2d Cir. 1994); Basko v. Sterling Drug, Inc., 416 F.2d 417, 426 (2d Cir. 1969).

District of Columbia: McNeil Pharmaceutical v. Hawkins, 686 A.2d 567, 578 (D.C. 1996).

Florida: E.R. Squibb & Sons, Inc. v. Farnes, 697 So.2d 825, 828 (Fla. 1997); Bailey v. Janssen Pharmaceutica, Inc., 2006 WL 3665417, at *4 (S.D. Fla. Nov. 14. 2006).

Hawaii: Ontai v. Straub Clinic & Hospital, Inc., 659 P.2d 734, 743 (Haw. 1983).

Idaho: Toner v. Lederle Laboratories, 732 P.2d 297, 306-07 (Idaho 1987).

Illinois: Martin v. Ortho Pharmaceutical Corp., 661 N.E.2d 352, 354 (Ill. 1996); Woodill v. Parke Davis & Co., 402 N.E.2d 194, 198-99 (Ill. 1980); Needham v. White Laboratories, Inc., 847 F.2d 355, 357-58 (7th Cir. 1988); McMahon v. Eli Lilly & Co., 774 F.2d 830, 835 (7th Cir. 1985); Martinkovic v. Wyeth Laboratories, Inc., 669 F.Supp. 212, 215 (N.D. Ill. 1987).

Indiana: Ortho Pharmaceutical Corporation v. Chapman, 388 N.E.2d 541, 548 (Ind. App. 1979); Phelps v. Sherwood Medical Industries, 836 F.2d 296, 305-06 (7th Cir. 1987).

Iowa: Moore v. Vanderloo, 386 N.W.2d 108, 116 (Iowa 1986); Brazzell v. United States, 880 F.2d 84, 86-87 (8th Cir. 1989).

Kansas: Savina v. Sterling Drug, Inc., 795 P.2d 915, 926-27 (Kan. 1990); Tetuan v. A.H. Robins Co., 738 P.2d 1210, 1227 (Kan. 1987); Wooderson v. Ortho Pharmaceutical Corp., 681 P.2d 1038, 1057, 1062-64 (Kan. 1984).

Louisiana: La.Rev. Stat. Ann. §9:2800.59(B); Cauvin v. Sisters of Mercy Health System, Inc., 818 So.2d 833, 835 (La. App. 2002); Kinney v. Hutchinson, 468 So.2d 714, 718 (La. App. 1985); Miller v. Upjohn Co., 465 So.2d 42, 45 (La. App. 1985); Stahl v. Novartis Pharmaceuticals Corp., 283 F.3d 254, 272 n.11 (5th Cir. 2002); Williams v. Ciba-Geigy Corp., 686 F.Supp. 573, 575 (W.D. La. 1988), aff’d, 864 F.2d 789 (5th Cir. 1988).

Maine: Porter v. Pfizer Hospital Products Group, Inc., 783 F.Supp. 1466, 1475 (D. Me. 1992).

Maryland: Gourdine v. Crews, 955 A.2d 769, 781 (Md. 2008); Miles Laboratories, Inc. v. Doe, 556 A.2d 1107, 1121-22 (Md. 1989); Doe v. Miles Laboratories, Inc., 927 F.2d 187, 191-93 (4th Cir.1991); Chambers v. G.D. Searle & Co., 441 F.Supp. 377, 381-82 (D. Md. 1975), aff’d, 567 F.2d 269 (4th Cir. 1977).

Massachusetts: Vassallo v. Baxter Healthcare Corp., 696 N.E.2d 909, 923-24 (Mass. 1998); Kelly v. Wyeth, 2007 WL 1302589, at *7 (Mass. Super. April 12, 2007); Haidak v. Pfizer, Inc., 2002 WL 126680, at *2 (S.D.N.Y. Jan. 31, 2002).

Michigan: Muilenberg v. Upjohn Co., 426 N.W.2d 767, 773 (Mich. App. 1988); May v. Parke, Davis & Co., 370 N.W.2d 371, 376 (Mich. App. 1985); Dunn v. Lederle Laboratories, 328 N.W.2d 576, 580 (Mich. App. 1983).

Minnesota: O’Hare v. Merck & Co., 381 F.2d 286, 291 (8th Cir. 1967).

Missouri: Bine v. Sterling Drug, Inc., 422 S.W.2d 623, 627-28 (Mo. 1968); Meyer v. Astrazeneca Pharmaceuticals, L.P., 224 S.W.3d 106, 108 (Mo. App. 2007); Johnston v. Upjohn Co., 442 S.W.2d 93, 97 (Mo. App. 1969); Sterling Drug, Inc. v. Cornish, 370 F.2d 82, 84 (8th Cir. 1966); Stanger v. Smith & Nephew, Inc., 401 F.Supp.2d 974, 980-81 (E.D. Mo. 2005).

Montana: Hill v. Squibb & Sons, 592 P.2d 1383, 1388 (Mont. 1979); Davis v. Wyeth Laboratories, Inc., 399 F.2d 121, 129 (9th Cir. 1968).

New Hampshire: Brochu v. Ortho Pharmaceutical Corp., 642 F.2d 652, 657-58 (1st Cir. 1981).

New Jersey: N.J.S.A. 2A:58C-3a(1); Feldman v. Lederle Laboratories, 479 A.2d 374, 386-87 (N.J. 1984); Ferrigno v. Eli Lilly & Co., 420 A.2d 1305, 1321 (N.J. Super. Law Div. 1980).

New Mexico: Richards v. Upjohn Co., 625 P.2d 1192, 1195-96 (N.M. App. 1980).

New York: Mulhall v. Hannafin, 841 N.Y.S.2d 282, 285-86 (N.Y.A.D. 2007); Donigi v. American Cyanamid Co., 394 N.Y.S.2d 422, 422-23 (N.Y.A.D. 1977), aff’d mem., 374 N.E.2d 1245 (N.Y. 1978); Friedman v. Medtronic, Inc., 345 N.Y.S.2d 637, 642 (N.Y.A.D. 1973); Garfinkel v. Bayer Corp., 2003 WL 25668274 (N.Y. Sup. Oct. 30, 2003); Tenuto v. Lederle Laboratories, 695 N.Y.S.2d 259, 263 (N.Y. Sup. 1999), aff’d, 714 N.Y.S.2d 448 (N.Y.A.D. 2000).

North Dakota: Harris v. McNeil Pharmaceutical, 2000 WL 33339657, at *3 n.2 (D.N.D. Sept. 5, 2000).

Ohio: White v. Wyeth Laboratories, Inc., 533 N.E.2d 748, 753 (Ohio 1988).

Oklahoma: Edwards v. Basel Pharmaceuticals, 933 P.2d 298, 303 (Okla. 1997).

Oregon: McEwen v. Ortho Pharmaceutical Corp., 528 P.2d 522, 528-29 (Or. 1974); Cochran v. Brooke, 409 P.2d 904, 907 (Or. 1966).

Pennsylvania: Hahn v. Richter, 628 A.2d 860, 867-68 (Pa. Super. 1993), aff’d, 673 A.2d 860 (Pa. 1996); Leibowitz v. Ortho Pharmaceutical Corp., 307 A.2d 449, 458 (Pa. Super. 1973); Mazur v. Merck & Co., 964 F.2d 1348, 1366-67 (3d Cir. 1992); In re Zyprexa Products Liability Litigation, 489 F.Supp.2d 230, 268 (E.D.N.Y. 2007).

Puerto Rico: Muniz-Nunez v. American Home Products Corp., 582 F.Supp. 459, 462 (D.P.R. 1984).

Rhode Island: Castrignano v. E.R. Squibb & Sons, Inc., 546 A.2d 775, 782 (R.I. 1988); Castrignano v. E.R. Squibb & Sons, Inc., 900 F.2d 455, 459-60 (1st Cir. 1990).

South Dakota: McElhaney v. Eli Lilly & Co., 575 F.Supp. 228, 231-32 (D.S.D. 1983), aff’d, 739 F.2d 340 (8th Cir. 1984).

Tennessee: Witherspoon v. Ciba-Geigy Corp., 1986 WL 2138, at *3 (Tenn. App. Feb. 12, 1986).

Texas: Bristol-Myers Co. v. Gonzales, 561 S.W.2d 801, 804 (Tex. 1978); Crocker v. Winthrop Laboratories, 514 S.W.2d 429, 433 (Tex. 1974); Gerber v. Hoffmann-La Roche Inc., 392 F.Supp.2d 907, 915 (S.D. Tex. 2005).

Utah: Grundberg v. Upjohn Co., 813 P.2d 89, 98 (Utah 1991).

Virginia: Stanback v. Parke, Davis & Co., 502 F.Supp. 767, 770 (W.D. Va. 1980).

Washington: Laisure-Radke v. Par Pharmaceutical, Inc., 426 F.Supp.2d 1163, 1172-73 (W.D. Wash. 2006).

West Virginia: Totterdale v. Lederle Laboratories, 2008 WL 972657 (W. Va. Cir. March 19, 2008).

Wisconsin: Stupak v. Hoffman-La Roche, Inc., 2007 WL 4218982, at *2 (M.D. Fla. Nov. 29, 2007).

Wyoming: Thom v. Bristol-Myers Squibb Co., 353 F.3d 848, 854-55 (10th Cir. 2003); Jacobs v. Dista Products Co., 693 F.Supp. 1029, 1033-34 (D. Wyo. 1988)

We’ll be greatly interested to see how the state-of-the-art defense evolves in prescription drug product liability litigation, now that the Supreme Court has invoked knowability/unknowability principles as a limitation on preemption.

NJ Vioxx Class Certification Denial

We can't say much, because Herrmann's on the road and Bexis is involved in the litigation, but a trial court in New Jersey just denied certification of an individual consumer economic loss class action, both nationwide and limited to New Jersey. The bases of the decision:

There is no predominance. "The causal nexis between the loss sustained by each member of the class and the consumer fraud. . .creates an insurmountable barrier to a class action." Slip op. at 12. Consumers made "individualized decisions" to use the drug. Id. at 13.

Unjust enrichment is not a valid theory of liability in a case involving allegations of improper warnings/marketing of a product. Id. at 15.

There is no typicality because each class menber "received a different benefit from the drug." Id. at 16.

There is no superiority because "it would be unfair to [defendant] to certify a class and allow a jury to reach one uniform determination of liability where results [as shown by past outcomes] could vary from plaintiff to plaintiff." Id. at 17.

The court did not reach choice of law. Id. at 18

Class Action Articles Posted To SSRN

This is not really new news.

Herrmann (and co-authors) published "The Class Action Fairness Act: An Ill-Conceived Approach to Class Settlements" a couple of years ago in the Tulane Law Review and "Making Class Actions Work: The Untapped Potential of the Internet" more recently in the University of Pittsburgh Law Review.

The new news is that one of Herrmann's co-authors has figured out how to upload documents to the Social Sciences Research Network, so there are now SSRN links for each of these articles. For the Tulane piece, please click here. And for Pittsburgh, click here.

Generic Drugs Meet Levine

One silver lining from the severe pruning that prescription drug preemption took in Wyeth v. Levine, is that there may now be less incentive to expand the common-law liabilty of pioneer manufacturers in generic drug cases - something we've discussed in posts that readers can find under the "product identification" "generic drug" and "Conte" labels in the right-hand margin of the blog.

In Schrock v. Wyeth, slip op., 2009 WL 635415 (W.D. Okla. Mar. 11, 2009), the court basically gave the preemption arguments made by generic drug manufacturers the back of its hand, holding:

Defendants in this case have proffered similar, if not identical, arguments concerning the obstruction of the purposes and objectives of federal drug labeling regulation. As in Wyeth, however, this Court finds that there is a longstanding coexistence of state and federal law in the regulatory history and background relevant to this case. Therefore, the Court finds that this state-law action does not obstruct the purposes and objectives of Congress. . . . As to any remaining basis which defendants have presented in the instant matter, the United States Supreme Court has clearly concluded that Congress did not intend the preempt state-law failure-to-warn actions.

Slip op., 2009 WL 635415, at *3. After Levine we're not particularly surprised at this result.

What's of greater interest to us (since we don't represent generic drug manufacturers) is the court's grant of summary judgment to the pioneer manufacturer - on the entirely reasonable ground that the plaintiff never took its drug. The court cites the usual state-law proposition that manufacturers aren't liable for defects in products they didn't make. Slip op., 2009 WL 635415, at *4-5. It also follows the federalist principle we've advocated previoiusly (see "Erie doctrine" label): "As a federal court, we are generally reticent to expand state law without clear guidance from its highest court." Slip op., 2009 WL 635415, at *4. We love all that, but what follows may be even more significant in the long run:

Finally, plaintiffs opine that they would be denied of any remedy if the generic manufacturers are not responsible due to federal preemption, and the brand name manufacturers are similarly not responsible. The Court finds, however, that this is no longer an issue in light of the earlier finding that plaintiffs are not preempted by federal law from pursuing their state law claims.

Slip op., 2009 WL 635415, at *4 (emphasis added). We've long been of the opinion that the source of most of the pressure in generic drug cases on traditional tort principles that limit manufacturer liability to their own products has been the strength of the generics' preemption arguments, and corresponding judicial reluctance to throw generic-using plaintiffs out of court entirely.

If, however, the preemption arguments of the generic manufacturers don't fare any better after Levine than they did in Schrock, the urge that some courts have felt to distort well-settled tort principles to sock it to pioneer (non-)manufacturers may well abate.

It's certainly an unintended consequence, but to this extent Wyeth v. Levine may prove to be of at least some benefit to defendants.

A Riegel Wrinkle: "Adjunct Clinical Trial" Preemption

As you know, we watch the medical device preemption cases.

And we've discussed a case after Riegel finding preemption in the context of a device used in a clinical trial under an Investigational Device Exemption.

But here's a Riegel wrinkle. (In fact, we like this case so much that we might call it a regal Riegel wrinkle. In fact, . . . well, never mind.)

Anyway, it's Dorsey v. Allergan, No. 3:08-0731, slip op. (M.D. Tenn. Mar. 11, 2009) (here's the obligatory link). After the breast implant brouhaha in the very early '90s, McGhan Medical Corporation obtained FDA approval to conduct a clinical trial studying the use of breast implants in breast augmentation patients. That was the "core" study and was approved by the FDA in 1998. Id. at 2-3.

On a separate track, the FDA also approved McGhan's proposal to study breast implants used in breast reconstruction patients. That was the "adjunct" study, also approved in 1998. Id. at 2.

Plaintiff Susan Dorsey received Style 20 implants on November 9, 2005, as part of the adjunct study. Her consent form "indicated that the use of the implants was investigational and not FDA approved." Id. at 3. Dorsey allegedly began to experience pain and fatigue immediately after the surgery, and her implants were removed on September 29, 2006. The Style 20 implants received premarket approval from the FDA two months later, on November 17, 2006.

Dorsey pleaded one count of strict liability against Allergan, which manufactured the implants.

Allergan moved for summary judgment on the basis of preemption, citing, among other cases, Riegel v. Medtronic, 128 S. Ct. 999 (2008). Dorsey tried to distinguish Riegel on the grounds that (1) the Style 20 implants had not received premarket approval at the time of her surgery, and (2) her surgery was performed under the adjunct clinical trial, rather than the core one. Id. at 8.

The court rejected both arguments. First, the FDA ultimately granted premarket approval to the Style 20 implants. The FDA thus concluded that the devices were safe and effective. That finding undercut any claim that the devices were "unreasonably dangerous" for purposes of strict liability under Tennessee law. "[T]he subsequent approval by the FDA is a bar to Plaintiff's strict liability claim because the FDA has determined that the implants at issue are reasonably safe for consumers and there is no suggestion that the implants she received were somehow different than those ultimately approved by the FDA." Id. at 9.

Second, the use of the implants in an adjunct study, rather than a core one, was a distinction without a difference. "[W]hether the Style 20 implant was a part of the core or adjunct study, the FDA has approved its use and therefore Plaintiff's claim is preempted." Id. at 11.

"[R]egardless of how it was characterized (as a clinical or adjunct study), the record suggests that the information given to the FDA was consistent with the IDE protocol in the core study and Plaintiff has provided absolutely no evidence which would suggest otherwise." Id.

After Riegel, preemption should be available as a defense in PMA and IDE cases (and, depending on the facts, perhaps in others, too). There's no reason to distinguish between core and adjunct clinical trials, so we're pleased to see that argument laid to rest.

Your Humble Scribes On Levine In BNA Product Safety Reporter

Blogging makes you psycho. (Frankly, we didn't have that far to go even before we started blogging.)

Not only do you want to break stories on the web, you want to be among the first to comment in the print media, too.

The two of us thus teamed up to write a piece for today's BNA's Product Safety & Liability Reporter analyzing the implications of Wyeth v. Levine. Here's a link to the article. (Since BNA is a subscription publication, you may not be able to open this unless your firm subscribes. Sorry about that.)

Accutane: McCarrell Remanded For New Trial

We know that headline is boring: "Accutane: McCarrell Remanded For New Trial."

But give us a break.

Levine comes down. We're duty-bound to blog about it. The press calls for reactions to it. We're writing about the case in print media. We're being asked to speak about the case.

And then there's our real jobs: Our long-dormant drug cases bust loose because all those stays pending Levine are now lifted.

And that same week -- that same week -- the !**@!! New Jersey Appellate Division hands down a 113-page appellate decision in McCarrell v. Hoffman-LaRoche, No. A-3280-07T1 (N.J. App. Div. Mar. 12, 2009) (link here). What's a blogger to do?

Here's what we'll do: We'll give you the shortest little description of McCarrell, tell you very briefly why it matters, and then call it quits. We apologize for giving you the bum's rush, but life's pretty hectic here.

Andrew McCarell took Accutane for acne and then developed inflammatory bowel disease, which led to, among other things, surgical removal of his colon. He sued Hoffman-LaRoche, the manufacturer of the drug, in New Jersey state court for product liability and consumer fraud. After a 15-day trial, the jury returned a verdict (of $119,000 for past medical expenses and $2.5 million in compensatory damages) in favor of McCarrell on the product liability claim, and a verdict in favor of Roche on the consumer fraud claim.

The first issue on appeal was the admissibility of plaintiff's expert testimony purportedly linking Accutane to IBD. (The federal MDL judge excluded similar expert testimony under Daubert, in a decision that was upheld by the Eleventh Circuit.) The New Jersey Appellate Division trotted through (at a length that's really not acceptable when we're this busy) the scientific evidence supporting plaintiff's expert's opinion. The court then concluded that (1) different experts testified in the MDL and in New Jersey state court, (2) the standards for admissibility are different in federal court and New Jersey state court, and (3) the evidentiary record in New Jersey was more developed, because it followed a trial. The court thus affirmed the decision to admit the expert's testimony on causation. Id. at 82.

The second issue on appeal was whether the trial court erred by letting plaintiff's witness refer to the number of adverse incidents reported about Accutane while excluding Roche's testimony about the large number of people who had ingested the drug and "the comparative significance of those figures." Id. at 92. The appellate division held "that the trial court erred in unduly restricting Roche's effort to provide relevant background statistics and other related proofs about Accutane usage to the jury." Id. at 104.

That's a holding that matters. Judge Higbee made similar evidentiary rulings in other Accutane cases that have been tried before her, so it's quite likely that other plaintiffs' verdicts will now be reversed on the same ground. And, needless to say, that holding protects defendants who manufacture other drugs from being forced into a similar evidentiary bind at trial.

Finally, the Appellate Division briefly addressed Roche's remaining arguments. The court affirmed the trial court's application of the New Jersey statute of limitations to this Alabama plaintiff and found that equitable tolling of the statute rendered plaintiff's lawsuit timely. Id. at 106. The court found "reasonable factual support" for the jury's conclusion that the warning label on Accutane was inadequate. Id. at 107. And the court remanded for the trial court to consider Roche's preemption defense in light of the holding in Wyeth v. Levine. In particular, the trial court is to address whether "Roche can show by 'clear evidence' that the FDA would not have approved a change to the Accutane label." Id. at 112. We don't know enough about the administrative record surrounding Accutane to speculate on how that issue will ultimately play out.

That's not a home run for Roche, but it's a hit of some kind: Score it a single, with the batter taking second on an error.

How The Chief Resolved The Recusal Issue

Last month, the web was ablaze with speculation about whether Chief Justice Roberts would recuse himself from Wyeth v. Levine, because the Chief owns stock in Pfizer, and Pfizer had announced its intention to acquire Wyeth. Coverage of that issue appeared here, here, and here, among other places.

Here's what the Chief did: He participated in deciding Wyeth v. Levine (as one of the three dissenters in a 6 to 3 vote), perhaps because Pfizer's future acquisition of Wyeth is subject to conditions and ultimately may not close, so the Chief has only a speculative, future financial interest in Wyeth.

But the Chief recused himself from Colacicco v. Apotex (not participating in the decision to grant cert, vacate, and remand for reconsideration in light of Levine), a case involving Pfizer as a party. The Chief presumably still owns Pfizer stock and thus has a current interest in that case.

Everyone's Talking About Levine

So far, we've learned of the following upcoming webinars with panels analyzing the implications of Wyeth v. Levine:

On Friday, March 27, at noon Eastern, the Defense Research Institute presents "Supreme Court's Preemption Decision in Wyeth v. Levine," featuring Michael Davis and Rebecca Wood (both of Sidley Austin), who wrote an amicus brief in Levine on behalf of DRI.

On April 1, at 1 p.m. Eastern, the Practicing Law Institute offers "Wyeth v. Levine: Supreme Court Rules on Implied Conflict Preemption for Prescription Drugs," in which Russell Jackson (of Skadden Arps) will host a discussion featuring David Frederick (of Kellogg Huber), who argued for Levine in the Supreme Court, and Bert Rein (of Wiley Rein), who was on the defense team for Wyeth. That's a great panel.

On April 8, at 1 p.m. Eastern, Strafford offers "Federal Preemption After Wyeth v. Levine," featuring Scott Angstreich (of Kellogg Huber), who worked on the briefs for Levine, and Russell Jackson again. Russell must be making a career of talking about the case.

Finally, on April 15, at 11:30 a.m. Eastern, the Center for Business Intelligence presents "Buried Treasure: Preemption After Wyeth v. Levine," with Rob Weiner (of Arnold & Porter) and our own Herrmann. Well -- at least Weiner's okay.


UPDATE: We just learned about another one. On March 24, at 1:30 p.m. Eastern, FDA News presents "The Real Impact of Wyeth v. Levine: How to Survive in a Post-Preemption World," with Kurt Karst and John Fleder, both of Hyman, Phelps & McNamara.

Device Preemption Bookends

We’ve decided to blog on a less depressing preemption subject than Wyeth v. Levine today. We’ve seen a couple of recent medical device preemption cases that just about bookend the field. In Hofts v. Howmedica Osteonics Corp., 2009 WL 331470 (S.D. Ind. Jan. 12, 2009), the court found just about as little preemption (and probably less) as there could possibly be under Riegel v. Medtronic, Inc., 128 S. Ct. 999 (2008). On the other hand, the court in Horowitz v. Stryker Corp., 2009 WL 436406 (E.D.N.Y. Feb. 20, 2009), found just about as much preemption (express, anyway) as any court since Riegel.

No matter what the Supreme Court does, courts continue to view tort preemption questions through the lenses of their own particular philosophies.

Since legal bloggers are necessarily masochists, we’ll do the icky one first. In Hofts the defendant, which made a premarket approved (“PMA”) hip implant, moved to dismiss a plaintiff’s complaint that alleged most of the usual claims – strict liability and negligent manufacture, breach of express and implied warranties (both merchantability and fitness for a particular purpose), and (since when did this become usual?) consumer fraud. 2009 WL 331470, at *1.

Memo to selves – Defense counsel takes a big risk raising preemption on a motion to dismiss. Unless we know how a judge leans, it’s best to build a record – especially where the plaintiff is seriously arguing “parallel claim” in opposition to preemption.

Somewhat amazingly in light of Riegel, Hofts managed to hold that every one of these claims escaped preemption – at least on motion to dismiss. It didn’t take long to figure out that this decision was coming from the gut:

Even so, some medical device manufacturers. . .have tried recently to stretch Riegel beyond recognition by transforming its protection for FDA-approved devices that comply with federal law into a grant of civil immunity for FDA-approved devices that violate federal law.

2009 WL 331470, at *1.

Pretty stong stuff – especially since Riegel didn’t even decide any question about violation claims, since the Supreme Court held that such allegations had been waived. Riegel v. Medtronic, Inc., 128 S. Ct. 999, 1011 (2008) (“Although [plaintiffs] now argue that their lawsuit raises parallel claims, they made no such contention in their briefs before the Second Circuit, nor did they raise this argument in their petition for certiorari.”). In the Supreme Court’s determination that violation claims in Riegel were waived, Hofts nevertheless found “clear instructions” that such claims survive preemption. 2009 WL 331470, at *3.

Wham! You know what they say about when you’ve got a hammer, the whole world looks like a nail. Well, every claim in Hofts hid a violation claim somehow. And the defendant in Hofts got nailed.

Manufacturing Defect – Plaintiff alleged that the defendant was “not in compliance with Current Good Manufacturing Practice requirements approved by the FDA and [the product] had an impurity, imperfection, and/or another product defect” which defect “was a deviation from design and quality manufacturing standards. . .approved by the FDA. Id. at *4 (quoting complaint). Not only that, incorporated by reference was negligence language that the defendant “failed to exercise reasonable care and/or was reckless in the testing, manufacture, quality assurance, and sale of the [device].” Id. That appears (from the opinion anyway) to be it.

Boilerplate alert! Not a fact in sight.

We’ve known for over a year now that under Bell Atlantic Corp. v. Twombly, 127 S. Ct. 1955 (2007), the plaintiff has to plead at least a couple of real, live facts to make such allegations plausible. Like what? How about that such a violation exists somewhere other than in the imagination of plaintiff’s counsel. Something the FDA said about the particular device comes to mind. Its warning letters are all online, after all. Heck, even an opinion by the plaintiff’s own paid expert (how hard could that be?) might be enough, if based on an actual fact or two.

The response in Hofts? Forget pleading facts; gotta have discovery:

[The plaintiff] has brought claims premised on [defendant’s] alleged failure to manufacture the [device] in accordance with the PMA issued by the FDA. . . . With discovery, he may or may not be able to prove those claims, but his claims are premised on requirements that are parallel to the federal requirements. His claims are not preempted at the pleading stage.

2009 WL 331470, at *7.

But that’s not Twombly – something Hofts more or less admits when it protests against “an unusually stringent application of Twombly.” 2009 WL 331470, at *6 (discussing In re Medtronic, Inc. Sprint Fidelis Leads Products Liability Litigation, 592 F. Supp.2d 1147 (D. Minn. 2009)).

What’s Twombly then? This is Twombly:

• “Asking for plausible grounds. . .does not impose a probability requirement at the pleading stage; it simply calls for enough fact to raise a reasonable expectation that discovery will reveal evidence of illegal agreement.” 127 S. Ct. at 1965.
• A “formulaic recitation of the elements of a cause of action will not do.” Id. at 1965.
• “[I]t is one thing to be cautious before dismissing [a] complaint in advance of discovery, but quite another to forget that proceeding to antitrust discovery can be expensive . . . . It is no answer to say that a claim just shy of a plausible entitlement to relief can, if groundless, be weeded out early in the discovery process.” Id. at 1967.
• “[I]t is only by taking care to require allegations that reach the level suggesting conspiracy that we can hope to avoid the potentially enormous expense of discovery.” Id.
• “[B]efore proceeding to discovery, a complaint must allege facts suggestive of illegal conduct.” Id. at 1969 n.8.

Thus we’d say (we’re defense counsel, right?) that Hofts put the discovery cart before the pleading horse when it credited a boilerplate violation that could be slapped without changing a word into any complaint about any device.

Hofts also points out that the plaintiff’s “claims and theories are more specific than those that survived dismissal in Lohr.” 2009 WL 331470, at *7. That may well be true. The Supreme Court in Lohr certainly couldn’t tell what the plaintiffs meant. Medtronic, Inc. v. Lohr, 518 U.S. 470, 495 (1996) (“the precise contours of their theory of recovery have not yet been defined”). But last time we looked 1996 was before 2007 – which means that Lohr was decided before Twombly. So Hofts’ reliance on Lohr for a specificity-of-pleading point is just another way of ignoring the Supreme Court’s more recent opinion in Twombly.

Hofts then goes on the kind of rant that would be worthy of us on one of our more hacked off days – like just about every day:

The ability to bring civil claims based on violations of federal requirements is not a “back door” that was inadvertently left open by the MDA and Riegel, but a familiar part of the common law: an alleged tortfeasor's violation of the law (a speed limit, a building code requirement, or a PMA requirement) serves as evidence that the defendant breached a duty owed to the plaintiff. If the law were otherwise-if it were as [defendant] argues – then Riegel and the MDA would be turned upside down and Lohr would be overruled. . . . But if the MDA were construed as [defendant] argues here, the legislation would be transformed into a grant of immunity from civil liability for manufacturers who violate those same federal requirements. That result was rejected by the Court in Lohr, and neither the MDA nor Riegel supports it.

2009 WL 331470, at *7 (citations and non-rant portions omitted).

The problem is we don’t know if the premise of the rant is true or not, because plaintiff failed to plead anything other than “I got hurt, therefore defendant must have violated the FDCA” – which is even more of a stretch than “I got hurt, therefore defendant must be liable.” The latter isn’t enough to state a claim under Indiana (or any other) law. See Smith v. Michigan Beverage Co., 495 F.2d 754, 757 (7th Cir. 1974) (“Just as it is the general rule that the mere fact of injury will not create an inference of negligence, the mere fact of the accident cannot create an inference of a defect in a products case”) (applying Indiana law); Gaskin v. Sharp Electronics Corp., 2007 WL 2819660, *5 (N.D. Ind. Sept. 26, 2007) (“the mere fact that an accident occurred does not create an inference of a defect in a products liability case”; just so nobody thinks this is some outdated principle).

We also need facts to evaluate what Hofts said about Lohr because, just as Lohr isn’t the Supreme Court’s last word about pleading (assuming Lohr had anything to say about pleading at all), it’s not the last word about so-called “parallel” claims either. The Court in Buckman Co. v. Plaintiffs’ Legal Committee, 531 U.S. 341 (2001), elaborated upon the brief discussion in Lohr:

We must also reject respondent’s attempt to characterize both the claims at issue in [Lohr] and the fraud claims here as “claims arising from violations of FDCA requirements”. . . . [I]t is clear that the [Lohr] claims arose from the manufacturer’s alleged failure to use reasonable care in the production of the product, not solely from the violation of FDCA requirements. In the present case, however, the fraud claims exist solely by virtue of the FDCA disclosure requirements. Thus, although [Lohr] can be read to allow certain state-law causes of actions that parallel federal safety requirements, it does not and cannot stand for the proposition that any violation of the FDCA will support a state-law claim.

Id. at 352-53. Because Hofts let the plaintiffs get away with pleading nothing about the nature of the purported violation, it’s impossible to tell whether the unspecified violation has any equivalent in Indiana common law.

We do know that, for a statute to constitute negligence per se under Indiana law, it must have a “construction consistent with the legislative purpose of both Indiana and federal” law. Walling v. Appel Service Co., 641 N.E.2d 647, 652 (Ind. App. 1994). We also know, because Congress told us in the statute itself, that violations of the Food, Drug and Cosmetic Act (“FDCA”) are only enforceable by the federal government, and not state tort litigants. 21 U.S.C. §337(a) ("all such proceedings for the enforcement, or to restrain violations, of this chapter shall be by and in the name of the United States"). The Supreme Court held precisely this in Buckman. 531 U.S. at 349 n.4 (“The FDCA leaves no doubt that it is the Federal Government rather than private litigants who are authorized to file suit for noncompliance with the medical device provisions”) (citing §337(a)).

Thus the rant in Hofts about defense preemption arguments somehow overruling Lohr or turning Riegel upside down appears to us to be unencumbered by either facts (which aren’t pleaded) or law (which would seem to be otherwise). But we can tell you from experience, that kind of rant often makes the ranter feel better.

But we digress.

Express Warranty – That’s not preempted either. Plaintiff “claims that the [device] did not live up to the FDA-approved promises contained in its label and that he was harmed as a result.” 2009 WL 331470, at *7. Riegel didn’t hold express warranty claims are preempted, and neither has the Seventh Circuit. Id. That’s true enough, and we’ve noted in our device preemption scorecard the split of authority on this point. But then Hofts goes on to “find[] that [plaintiff’s] breach of express warranty claim is also a parallel claim and is not preempted.” Id.

Hold on, then. We’re willing to concede that there's a split of authority post-Riegel (like there was pre-Riegel) on express warranty claims. But how did they turn into “parallel” violation claims? Since when did a breach of express warranty become an FDCA violation? Hofts cites Mitchell v. Collagen Corp., 126 F.3d 902, 915 (7th Cir. 1997), for this proposition, so we took a look:

As we noted in our earlier opinion, such warranties arise from the representations of the parties and are made as the basis of the bargain between them. A state judgment based on the breach of an express representation by one of the parties does not necessarily interfere with the operation of the PMA, and therefore we cannot say that such a cause of action is preempted.

Id. In other words, Mitchell held just the opposite – that express warranty claims escaped preemption because they had nothing at all to do with FDA oversight. See also the “earlier opinion” Mitchell v. Collagen Corp., 67 F.3d 1268, 1285 (7th Cir. 1995) (express warranty claims “seek[] recovery solely for the [defendant’s] alleged breach of its own, self-imposed undertakings”). So we have to say, while there’s an argument that express warranty claims aren’t preempted, it’s not because they’re somehow “parallel” claims as Hofts held.

Implied Warranty – Mitchell (which is binding on Indiana federal courts) held, in the paragraph immediately before the express warranty discussion we just got done quoting, “[i]f the [plaintiffs] meant to allege an implied warranty, it is preempted.” 126 F.3d at 915. But Hofts doesn’t quite see it that way:

The FDA’s own regulations explicitly restrict the reach of the MDA’s preemption clause from state law claims brought under regulations of general applicability, including the Uniform Commercial Code. The regulations specifically note that breach of implied warranty claims are not preempted . . . . See 21 C.F.R. §808.1(d)(1).

2009 WL 331470, at *8. Because the defendant “failed to demonstrate at the pleading stage” that the implied warranty claims “rest on allegations about standards other than those permitted by the FDA,” they aren’t preempted “in light of the FDA’s regulation specifically permitting breach of implied warranty claims.” Id.

So there.

But let’s see. Hmmmm…. Section 808.1(d)(1)…. Haven’t we seen that somewhere before? What’s the name of that case? Yeah, something called Riegel, we think. The Supreme Court explicitly found that same regulation to be a hash:

All in all, we think that §808.1(d)(1) can add nothing to our analysis but confusion. Neither accepting nor rejecting the proposition that this regulation can properly be consulted to determine the statute’s meaning; and neither accepting nor rejecting the FDA’s distinction between general requirements that directly regulate and those that regulate only incidentally; the regulation fails to alter our interpretation of the text insofar as the outcome of this case is concerned.

128 S. Ct. at 1011. And to think that Hofts stated elsewhere that under the defendant’s argument “Riegel and the MDA would be turned upside down.” 2009 WL 331470, at *7. Suffice it to say, that we have a pretty hard time squaring Hofts’ reliance upon §808.1(d)(1) with the Supreme Court’s holding that the very same section – with respect to the very same implied warranty claims – “add nothing. . .but confusion.” Maybe we’re just confused. Being upside down gets disorienting.

Consumer Fraud – These aren’t preempted for the exact same reason that implied warranty claims aren’t, because §808.1(d)(1) “specifically permits” them. 2009 WL 331470, at *8. Any other reason? Nope. There’s just a reprise of the same statement as before – that the defendant “failed to demonstrate at the pleading stage” that the (substitute consumer fraud for implied warranty) “rest on allegations about standards other than those permitted by the FDA,” they aren’t preempted “light of the FDA’s regulation specifically permitting” them. Id. We’re not going to repeat ourselves on what Riegel held about that regulation. The dead horse has been thoroughly beaten.

That’s Hofts. As we’ve described, it’s reasoning provides a roadmap for plaintiffs trying to avoid preemption of product liability claims involving PMA medical devices after Riegel: Ignore Twombly, rant, ignore state law, ignore Buckman, ignore Riegel, turn controlling circuit court precedent on its head, and finally, ignore Riegel some more. Very persuasive. So persuasive that we highly recommend it to our opponents.

That’s one bookend.

Horowitz v. Stryker Corp., 2009 WL 436406 (E.D.N.Y. Feb. 20, 2009), is the other. Like Hofts, Horowitz decided a motion to dismiss. Like Hofts, Horowitz involved claims concerning a PMA hip implant. Id. at *1. Actually it involves the very same hip implant (Stryker and Howmedica are affiliated – we’re not going to bother explaining how). So did Horowitz reach the very same result on preemption?

Hardly. Or is that not hardly?

This complaint (at least as far as we can tell) was pleaded far more specifically than the complaint in Hofts – there being allegations in Horowitz about device recalls and FDA warning letters. 2009 WL 436406, at *2-3.

Even so, Horowitz took a much harder line on the alleged “parallel requirements” claims. In between Twombly cites, Horowitz held:

[G]eneralized allegations cannot withstand preemption because they fail to establish the necessary link between defendants’ federal violations and her alleged causes of action. . . . In an effort to satisfy the pleading standard and bring forth facts demonstrating the parallel nature of her claims, [plaintiff] points to two warning letters issued by the FDA. However, such letters do not provide the necessary connection to the specific [device] at issue in this case.

2009 WL 436406, at *6-7. The plaintiff’s bare recitation of warning letters and device recall didn’t establish any connection to the plaintiff’s injury. “[S]imply alleging that the defendants violated federal regulations did not necessarily mean that the plaintiff's strict liability claim was premised on those violations.” Id. at *7. That looks a lot like Buckman’s “solely by virtue” language to us.

Neither the warning letters nor the recall cut the mustard because they didn’t involve the product at issue. Id. at *8. What a shocking proposition. You mean, because a 1960 Corvair was "unsafe at any speed," that doesn’t mean that the 1957 Belair is defective? That logic didn’t pass muster in Horowitz:

In the present action plaintiff lacks such a tie to the device in question. Although plaintiff cites to recalls instituted by defendants, such recalls did not include the [device in question] or any of its components. Plaintiff introduces FDA warning letters mentioning defendants’ violations of federal regulations, but she never alleges that her particular product was included in the devices which were the subject of those letters nor does she provide a necessary link between the federal violations and her specific injury. Finally, plaintiff never alleges that any enforcement action was brought against defendants concerning the allegedly defective hip implant.

Id.; cf. Wyeth v. Levine, 2009 WL 529172, at *8 (U.S. March 4, 2009) (“the FDA’s belief that a drug is misbranded is not conclusive”).

Horowitz then evaluated many of the very same claims that cleared the preemption hurdle in Hofts.

Manufacturing defect – Pleading the FDA warning letters wasn’t enough. There was no explanation how the claimed violations in those 2006 and 2007 letters had anything to do with plaintiff’s device implanted in 2005. There’s no allegation that the letters involved the same production facility where plaintiff's device was made. 2009 WL 436406, at *8. So just because a defendant once received an FDA warning letter about something doesn’t mean that every product it ever made violated the FDCA. “Plaintiff cannot simply incant the magic words ‘[defendant] violated FDA regulations’ in order to avoid preemption.” Id.

But isn’t it asking too much under Twombly to require the plaintiff to plead that the alleged violation involved the product that allegedly caused injury? After all, that wasn’t a requirement in Hofts. The Hofts argument drew a footnote in Horowitz:

Requiring the plaintiff to plead his claims with more specificity, according to the Hofts court, would amount to an unusually stringent application of Twombly. On the contrary, requiring amplification as to how the defendants’ alleged federal violations relate to the plaintiff's claims is exactly what Twombly contemplates, especially where such a connection is implausible.

Horowitz, 2009 WL 436406, at *9 n.5. Because the plaintiff hadn’t shown that the alleged violation had anything to do with the device that was implanted, “for plaintiff to be successful in her negligence/recklessness claim a jury would have to find that the FDA requirements themselves were deficient." Id. at *9. Such claims were necessarily preempted by Riegel. Id.

Express Warranty – “Plaintiff's breach of express warranty claim is preempted to the extent that it is premised on FDA approved representations made by the manufacturer.” 2009 WL 436406, at *10. Some express warranty claims might escape preemption, but not those based upon statements that were contained in the labeling submitted to, and approved by, the FDA:

In order to avoid preemption, the plaintiff's breach of express warranty claim must identify specific representations of the manufacturer which exceed the scope of the FDA approved statements, thereby establishing a contractual obligation voluntarily entered into by the manufacturer. Any claim for breach of express warranty premised on the [device’s] FDA-approved label, however, must be preempted.

Id. at *11. Horowitz didn’t even bother to address Hofts on this point. Perhaps plaintiff's counsel, knowing the right argument to make, didn’t bother raising Hofts, since Hofts got the main argument against preemption of such claims precisely backwards.

Implied Warranty – Horowitz viewed the implied warranty claims as directly precluded by Riegel, since in Riegel the Supreme Court had analyzed such claims and held them preempted. 2009 WL 436406, at *10 (“a jury would have to find that defendants breached the implied warranty of merchantability by manufacturing a medical device that was unsafe in its federally approved design or manufacture”). The Hofts analysis of implied warranty was again dealt with in a footnote:

In Hofts[], in addressing the plaintiff’s breach of implied warranty claims, the district court found that “[t]he FDA’s own regulations explicitly restrict the reach of the MDA’s preemption clause from state law claims brought under regulations of general applicability including the Uniform Commercial Code.” The Hofts court ignores, however, that Riegel explicitly rejected that the regulation alters the outcome of the case, reasoning that such an interpretation would effectively swallow the preemption
rule.

2009 WL 436406, at *10 n.6. Yup, we thought there was a slight Riegel problem with the Hofts analysis of that claim.

Consumer Fraud – The plaintiff’s pleading in Horowitz was even worse with the consumer fraud claim than generally. “[P]laintiff makes no reference to the specific “acts, representations and/or omissions” that she claims are deceptive nor does she allege why these acts were deceptive.” Id. at *12. The FDCA violation allegations again failed because they had no connection to the plaintiff and the plaintiff’s device, and because they called FDA-approved labeling into question:

Even if the deceptive or misleading conduct [plaintiff] refers to has something to do with the FDA’s findings described in the warning letters and defendants’ failure to reveal such information to plaintiff, [plaintiff] provides no connection between the defendants’ deceptive conduct and a specific injury that she suffered as a result of that activity. . . . Similar to plaintiff’s breach of express warranty claim, plaintiff never specifies what false representations defendants made nor does she allege that she ever relied on any representations made by defendants. Moreover, using the [consumer fraud act] to attack the [device’s] FDA-approved label would run afoul of the MDA’s preemption provision.

2009 WL 436406, at *12.

Warning and Design Defect – In addition to the claims at issue in Hofts, Horowitz addressed, and held preempted, the same sorts of warning and design defect claims that were before the Supreme Court in Riegel. A “defective design claim, which challenges the FDA’s findings concerning the safety of the [device’s] design, necessarily imposes requirements that are different from, or in addition to, federal regulations.” Horowitz, 2009 WL 436406, at *10. A warning claim “would permit a jury to find that defendants were required to provide warnings above and beyond those on the [device’s] product label-a label that was specifically approved by the FDA as part of the PMA process.” Id. at *12. Nor was there even a pretense of a “parallel requirements” claim, because the FDA warning letters did not concern the product’s label. Id.

Just as Hofts was the plaintiff’s roadmap, so too is Horowitz a roadmap for the defense. We recommend it to our colleagues. What’s the difference between the two? More than anything else, we’d have to say their application of Twombly. If it’s enough to allege only that a defendant is “not in compliance” with some general type of FDA regulations and that a device “had an impurity, imperfection, and/or another product defect” which “was a deviation from” an unspecified something that was “approved by the FDA,” Hofts, 2009 WL 331470 at *4, then some of what Hofts holds about manufacturing defect, express warranty and consumer fraud (but not implied warranty) is understandable. But if Twombly means what it appears to say – and we tend to take the Supreme Court at its word – then the only result that makes sense is Horowitz.

Updates: Sprint Fidelis and Seroquel MDLs

Last week (we think; it was before Levine anyway) we reported on the belated and meritless recusal motion filed by the plaintiffs in the Sprint-Fidelis litigation. We were remiss in not reporting sooner, but the other day, the court denied the motion, as it well should have. The last section of the opinion discussed some of the practical implications that we raised about how requiring recusal in that situation could cause significant problems in the judiciary.

Also, we (well, Herrmann, because Bexis is part of the Seroquel defense team) blogged earlier about the magistrate's evidentiary rulings in the Seroquel MDL, one of which was to exclude foreign regulatory actions. We're happy to report that this decision was upheld by the judge yesterday, with a nice little opinion discussing how foreign regulatory decisions are irrelevant because they are based upon different regulatory standards than prevail in this country.

Herrmann on Levine in Chicago Tribune

We're delighted when the mainstream media occasionally picks up on things that we say here.

But we've noted before how silly it seems to echo at our little blog things that we've previously said in prominent papers.

Silly or no, we can't resist. Here's a link to Herrmann's op-ed piece about Wyeth v. Levine that appears in today's Chicago Tribune.

Reaction To Wyeth v. Levine

As you know, we've had a few words to say about the Supreme Court's decision last week in Wyeth v. Levine (here, here, and here).

But we weren't alone.

Jim Copland argues in Monday's Washington Times that Congress should adopt an adminstrative compensation scheme (akin to the vaccine act) that would simultaneously (1) protect drug companies from liability for drugs produced according to the FDA's requirements and (2) provide compensation to patients who suffered adverse events.

Gordon Cravitz argues in Monday's Wall Street Journal that the Wyeth v. Levine decision will put a drag on innovation by drug companies.

(Hat tip to Point of Law for both of those links.)

Peter Schuck argues in The New Republic that the FDA is more institutionally competent to assess the warnings on drug labels than are lay juries. Moreover, "the FDA's flaws -- and there are many -- can at least be remedied by Congress, to which it is highly accountable."

Michael Krauss at Point of Law deplores the state of preemption jurisprudence generally and suggests that the effect of Levine "may be confined to FDA matters, because of the lack of a pre-emption clause in the statute."

Russell Jackson analyzes at his blog how Levine will affect preemption analysis under regulatory schemes that differ from the Federal Food, Drug, and Cosmetic Act.

And Jonathan Adler (at the Volokh Conspiracy) says that Levine is further evidence that the "Roberts Court" may not be as pro-business as some have suggested it would be.

If that's not enough, Point of Law has another post that collects other reactions to the decision from around the web.

Enjoy!

Colacicco and Pennsylvania Employees Benefit Trust Fund GVR'ed

As we predicted last week (here and here), the Supreme Court this morning granted petitions for certiorari, vacated the appellate decisions, and remanded for reconsideration in light of Wyeth v. Levine the Third Circuit decisions in Colacicco v. Apotex and Pennsylvania Employees Benefit Trust Fund v. Zeneca.

Here's a link to today's Order List at the Supreme Court reflecting those two GVR's.

Should Congress Distinguish Between Drugs And Devices?

Here's the deal:

Riegel v. Medtronic tells us that there is preemption for medical devices approved through the premarket approval process.

Wyeth v. Levine tells us that there is often not preemption for prescription drugs.

Is there a reasoned basis for distinguishing between drugs and devices?

Of course: The Medical Device Amendments of 1976 contain an express preemption clause (21 U.S.C. Sec. 360); the Food, Drug and Cosmetic Act does not have a similar provision for drugs.

But that's a legal reason for making a distinction, not a policy reason.

And Congress is now thinking about eliminating the legal reason.

The Medical Device Safety Act of 2009, introduced last week, proposes to undo Riegel and to eliminate the preemption defense for PMA-approved devices. The new logic, announced in the wake of Levine, is that drugs and devices should be regulated similarly. In the words of Representative Frank Pallone: "Yesterday the Supreme Court rightfully upheld a patient's right to legal recourse after sustaining an injury from a pharmaceutical product. . . . Today, we introduce legislation that gives patients that same right when injured by a medical device."

Congress will now predictably start debating why devices have historically been regulated differently than drugs (with respect to preemption) and whether it makes sense to maintain the difference.

The historical answer is easy. In 1962, when Congress amended the Food, Drug and Cosmetic Act to require manufacturers to prove that new drugs were "effective" (as opposed to simply "safe"), the states were not doing much to regulate drugs. Because there was so little state law, Congress had no reason to focus on whether the federal regulatory scheme should displace that non-existent state law.

By 1976, when Congress passed the Medical Device Amendments, times had changed. "Most notably, the Dalkon Shield intrauterine device, introduced in 1970, was linked to serious infections and several deaths, not to mention a large number of pregnancies. . . . Several States adopted regulatory measures, including California, which in 1970 enacted a law requiring premarket approval of medical devices." Riegel v. Medtronic, 128 S. Ct. 999 (2008). In that environment, Congress naturally focused on the possibility of state regulation interfering with the federal regulatory scheme, and Congress chose affirmatively to preempt state law.

This historical record suggests (albeit gently, we concede) that preemption may be a good idea: When Congress focused on the issue, Congress expressly preempted conflicting state laws.

As Congress debates the Medical Device Safety Act, however, it should also consider possible policy reasons for maintaining broad preemption for medical devices even though there's now only narrow preemption for drugs.

(Please don't get us wrong here: In case you missed our last two years of blog posts, we believe that both drugs and devices should get the benefit of broad preemption. But Levine says we're wrong, and we don't wear the robes. We're now saying that, even with the loss in Levine, there may still be policy reasons to treat devices differently than drugs and to maintain preemption for devices.)

One of us thought about this issue a dozen years ago, as Lohr v. Medtronic was heading to the Supreme Court. (Actually, both of us were thinking about this issue back then, but only one of us published the thought in the following words.) Here are a couple of possible policy reasons for maintaining the preemption defense for PMA-approved devices, even if drugs generally won't have the defense:

[I]n light of the differences between drugs and medical devices, it was
neither ironic nor anomalous for Congress to distinguish between them in
establishing the preemptive scope of federal regulation. The
pharmaceutical industry is dominated by large manufacturers investing in products (drugs) that will likely be on the market for 30 to 50 years after they are
approved. [Citation omitted.] When it passed the Medical Device
Amendments, Congress understood that 'devices [are] subject to rapid
obsolence.' [Citation omitted.] And the Senate 'specific[ally]
noted' its consideration of 'the impact of this legislation on the small
manufacturer of medical devices,' in light of 'the importance of the small
innovative manufacturer in the invention and development of new medical devices
and the inability of these firms, because of limited financial resources, to
sustain the high level of administrative costs demanded of a highly regulated
industry.' [Citation omitted.] In this circumstance, it was
reasonable for Congress to decide that device manufacturers required more
protection from the costs of litigation than did pharmaceutical
manufacturers. [Citation omitted.]

Mark Herrmann and Geoffry J. Ritts, "Preemption and Medical Devices: A Response to Adler and Mann," 51 Food & Drug L.J. 1, 6 n.21 (1996).

After Lohr came down, we thought those words had been relegated to the dustbin of legal history. Now, with the debate over the Medical Device Safety Act, we can open the bin, blow off the dust, and renew that old debate.

The more things change . . . .

Dechert Client Alert on Wyeth v. Levine

There'll no doubt be a bunch of them, but the law firm client alerts about Wyeth v. Levine are beginning to hit the street (at least the streets where clients and potential clients live). Readers can send them to us. If we like them - if they've got some original thought - we'll link to them. Since Bexis is at Dechert, we got that firm's release first - and we like it. Here it is. We'd recommend reading it backwards: that is, start with "implications" (the most interesting part) and then read the description of the case (there are only so many ways to describe a legal opinion).

Medical Device Safety Act of 2009

It's been a tough two days for the drug and device industry.

Yesterday, Wyeth v. Levine.

Today, the Medical Device Safety Act of 2009, which is meant to reverse legislatively the Supreme Court's pro-preemption decision in Riegel v. Medtronic.

Here's a link to the House Committee on Energy and Commerce, which reports on the introduction of the MDSA in both the House and the Senate.

Wyeth v. Levine and the End of Deregulation

A little more than a year ago, back in February 2008, a majority of the Supreme Court stated, in Riegel v. Medtronic, Inc.:

Indeed, one would think that tort law, applied by juries under a negligence or strict-liability standard, is less deserving of preservation. A state statute, or a regulation adopted by a state agency, could at least be expected to apply cost-benefit analysis similar to that applied by the experts at the FDA: How many more lives will be saved by a device which, along with its greater effectiveness, brings a greater risk of harm? A jury, on the other hand, sees only the cost of a more dangerous design, and is not concerned with its benefits; the patients who reaped those benefits are not represented in court.

128 S. Ct. 999, 1008 (2008). That opinion was joined by seven Justices – Justice Scalia (who wrote it), along with the Chief Justice and Justices Kennedy, Souter, Thomas, Breyer, and Alito.

Yesterday in Wyeth v. Levine, a majority of the Supreme Court stated:

State tort suits uncover unknown drug hazards and provide incentives for drug manufacturers to disclose safety risks promptly. They also serve a distinct compensatory function that may motivate injured persons to come forward with information. Failure-to-warn actions, in particular, lend force to the FDCA’s premise that manufacturers, not the FDA, bear primary responsibility for their drug labeling at all times.

2009 WL 529172, at *12 (slip opinion here). That opinion was joined by five justices – Justice Stevens (who wrote it), along with Justices Kennedy, Souter, Ginsburg, and Breyer.

So what happened? How did the Court go from holding that tort litigation involving FDA-regulated products was “less deserving” of protection (in Riegel) to viewing it as the greatest thing since sliced bread (another FDA regulated product, by the way) in Levine?

Well, there’s one obvious thing. Justice Scalia, who wrote Riegel, dissented in Levine – conversely, Justice Stevens, who wrote Levine, did not concur in that part of Riegel. So, as is always the case, different justices see things differently.

But that still doesn’t explain Justices Kennedy, Souter and Breyer – fully a third of the Court – who joined both opinions.

So the question remains – what happened?

Well, an election happened, but: (1) we’re not so crass as to think that any member of the Court, beyond being aware of election returns, changes his or her mind for that reason, and (2) the briefing in Levine was all completed under the prior Bush administration, so it’s not like there was some abrupt change in the government’s position during the course of the case.

But beyond the election something else much more profound happened – large parts of the nation’s economy have come crashing down about our heads. Millions of people (including quite a few in the legal profession) have lost their jobs. The various stock markets have lost over half their value. Home values have fallen almost as far. We could go on, but don’t think we have to.

From President Obama on down, a lot of people have directed a lot of the blame for our current economic straits against the deregulation of the financial markets – a policy that was one of the hallmarks of the Bush Administration. The examples are legion, but here are a few. Thus deregulation doesn’t have a lot of friends anymore. And after Levine it’s painfully obvious that deregulation doesn’t have a lot of friends on the Court – at least with respect to FDA-regulated products.

So we think that the majority’s unwillingness to countenance what it saw as deregulation by way of preemption in Levine has a lot to do with the difference in both result and tone in contrast to Riegel – despite a significant overlap in the justices joining both opinions.

It all goes back to the facts.

We said a while ago that we thought that the facts in Levine were relatively favorable for the preemption defense. But facts turn out to be funny things – sometimes they appear and disappear as needed. Reading the Levine majority and dissenting opinions side by side, it’s sometimes hard to believe that they’re both discussing the same case. Indeed, the majority in Levine did something that’s quite unusual. Before making any other argument at all, Justice Stevens took great pains to address “two factual propositions decided during the trial court proceedings.” Levine, 2009 WL 529172, at *5. Then he proceeded to make (at least for purposes of the majority opinion – and that’s all that really counts at this point) most of the facts we liked disappear.

In particular, the majority held that through the miracles of post-verdict review, the plaintiff’s trial attacks on the FDA and its approval of the IV-push indication disappeared. Id. It no longer mattered that the plaintiff had expressly argued that the drug should never be used for that indication (id.: plaintiff “offered evidence that the IV-push method should be contraindicated and that [the drug] should never be administered intravenously”), since the Vermont Supreme Court later declared that the verdict “established only” that the “warning was insufficient.” There were thus “any number of ways” – all unstated – for Wyeth to change its warnings. Id. In this way, Levine was no longer the “failure to contraindicate” case that we always considered it to be. Id. Allowing that kind of a claim couldn't support a majority, so the plaintiff's claim became something else.

But we digress. The mere fact that the majority felt the need to address its “factual propositions” first, and in such detail, demonstrates how factually intensive the preemption analysis in Levine actually is. We think even our opponents would have to agree with that.

Now, let’s compare it to Riegel. The earlier case found preemption only after a very lengthy discussion of how the FDA had its mitts all over the device at issue. Riegel, 128 S. Ct. at 1004-05 (the seven paragraphs beginning with “[p]remarket approval is a ‘rigorous’ process”). Only after thus establishing that premarket approval “is in no sense an exemption from federal safety review – it is federal safety review,” id. at 1007 (emphasis original), did the Court proceed with the rest of its preemption analysis.

Thus the day after Riegel was decided we posted that preemption would produce a “a high regulation, low litigation” approach to medical device safety:

We fully expect [our clients] to continue doing the right thing, even with the threat of litigation substantially reduced. If they don’t. . .then the high regulation, low litigation model that Riegel is giving a chance to function isn’t going to work.

In this sense, Riegel presents a challenge to all of us who believe that free market capitalism – properly regulated – is the best economic system ever put into practice.

And this is not just a challenge for industry. Ditto the regulators. Riegel confers added responsibility on the FDA. The Agency has stated over and over again that it – not courts and lawyers – has primary responsibility for ensuring that the products it regulates are safe and effective. The FDA, like industry, now has to put up or shut up. . . . In short, it will have to exercise effective authority over PMA medical devices. . . . If the Agency doesn’t do this, the high regulation, low litigation model isn’t going to work.

That’s what we said over a year ago about Riegel. The FDA’s exercise of close review over medical devices is what supported the broad finding of preemption.

Fast forward.

Whatever else Levine does or doesn’t stand for, nobody can deny that the FDA failed – miserably – to convince a majority of the Court that the same high regulation, low litigation model that Riegel represented had been/could be followed with respect to the drug in question.

Again, it goes back to the facts. In Levine, first, there are the “facts” concerning Phenergan. We put quotation marks around the word facts because we don’t agree particularly with the majority’s view of them. But we’ll stop after this one time. That’s because the “true” facts – whatever they might be – don’t matter any more. The only facts that matter for interpreting and applying Levine are those the majority found to exist. So what did the majority find to be the facts about the FDA’s review of Phenergan, IV-push, and gangrene?

• The drug was approved in 1955, with supplemental New Drug Applications (“sNDA’s”) approved in 1973 and 1976. Id. at *3.
• After a third sNDA in 1981, during a 17-year period, the manufacturer and the FDA “intermittently corresponded about [the] label.” Id.
• During 1987-88 “the FDA suggested different warnings about” the relevant risk, and the defendant “submitted [to the FDA] incorporating the proposed changes.” Id.
• The FDA then didn’t respond to the defendant’s proposed changes. Eight years later, in 1996, “it requested from [defendant] the labeling then in use and, without addressing [defendant’s] 1988 submission, instructed it to “[r]etain verbiage in current label” regarding intra-arterial injection. Id.
• Two years after that, in 1998, after some back and forth not relevant to the case, “the FDA approved [defendant’s] 1981 application in 1998, instructing that [the drug’s] final printed label “must be identical” to the approved package insert. Id.
• There was “‘no evidence in this record that either the FDA or the manufacturer gave more than passing attention to the issue of”’ IV-push.” Id. at *9 (quoting Vermont Supreme Court decision).
• “[T]he FDA had not made an affirmative decision to preserve the IV-push method.” Id.
• The label changes that the defendant proposed in 1988 “did not differ in any material respect from the FDA-approved warning.” Rather, “the FDA viewed the change as non-substantive.” Id. at *9 n.5 (the second quote being from the government’s amicus brief).
• “[T]he FDA did not consider and reject a stronger warning against IV-push injection of Phenergan.” Id. at *13 n.14.

It’s clear from this discussion, just of the facts that the majority deemed relevant, that the question of “what in blazes went on for 17 years?” was high in their minds. It's not hard to see from this rendition how the majority found the FDA’s “identical” labeling instruction nothing more than pro forma, devoid of significant, risk-specific content.

More generally, the majority also called into question the FDA’s overall ability to carry out the sort of high regulation, low litigation model represented by the pro-preemption alternative (Riegel) to the current litigation dominated system. Just as the majority had a low opinion of the quality of the FDA’s superintendence of this aspect of Phenergan, it had a low opinion of the FDA’s overall competence to oversee warnings about drug risks:

• Prior to 2007 (that is, at the time of the events in question), the FDA had no power to order manufacturers to revise previously approved labeling. Levine, 2009 WL 529172, at
  *9.
• “The FDA has limited resources to monitor the 11,000 drugs on the market.” Id. at *12 (long footnote citing several studies critical of the FDA omitted).
• “[M]anufacturers have superior access to information about their drugs, especially in the postmarketing phase as new risks emerge.” Id.
• “[T]he FDA long maintained that state law offers an additional, and important, layer of consumer protection that complements FDA regulation.” Id.

Again, whether we agree or disagree is irrelevant. The Levine majority set out to trash the FDA and did so. After Levine, it behooves the defense to demonstrate that, in any particular case, the FDA did not in fact exhibit these general shortcomings. Rather, we’re going to have to prove, in as much detail as possible, that the FDA gave serious consideration and review to not only the particular drug, but to the particular risk as well. Given how the majority chose to frame the question (probably to keep itself together) this drug-specific and case-specific door has not been shut on implied conflict preemption. But nobody on this side of the “v.” should kid him/herself. After Levine we’ll need strong ("clear") evidence for preemption to work. Not a lot of cases are going to have it.

Finally, the majority’s overall low opinion of the FDA was mirrored by its evaluation of the power of the agency’s legal arguments. Historically, the Supreme Court has agreed with the government most of the time about tort preemption. The Solicitor General supported implied preemption only in Geier v. American Honda Motor Co., 529 U.S. 861 (2000), and that’s what the Court found. The Solicitor General supported implied preemption only in Buckman Co. v. Plaintiffs’ Legal Committee, 531 U.S. 341 (2001), and that’s what the Court found. The Solicitor General supported express preemption in Riegel, and that’s what the Court found. The Solicitor General opposed preemption in Altria Group, Inc. v. Good, 129 S. Ct. 538 (2008); Sprietsma v. Mercury Marine, 537 U.S. 51 (2002); and Medtronic, Inc. v. Lohr, 518 U.S. 470 (1996), and in each case, that’s what the Court found. The only recent variance was Bates v. Dow Agrosciences LLC, 544 U.S. 431 (2005), in which the Solicitor General supported a significantly broader scope of express preemption than the Court found.

Not this time. This time, the government’s position received “no weight.” Levine, 2009 WL 529172, at *13. The majority wasn’t buying what the FDA (represented by the DoJ/Solicitor General) was selling:

• “[T]he Court has performed its own conflict determination, relying on the substance of state and federal law and not on agency proclamations of pre-emption.” Id. at *11. The Court does “not defer[] to an agency's conclusion that state law is pre-empted.” Id.
• The FDA’s preemption preamble is “an agency’s mere assertion that state law is an obstacle to achieving its statutory objectives.” Id.
• The FDA did not “offer[] States or other interested parties notice or opportunity for comment” about “a sweeping position on the FDCA’s pre-emptive effect” and therefore the preamble is “inherently suspect in light of this procedural failure.” Id.
• The preamble is “at odds with what evidence we have of Congress’ purposes.” Id. at *13.
• The preamble “reverses the FDA’s own longstanding position without providing a reasoned explanation. . .of how state law has interfered with the FDA’s regulation of drug labeling during decades of coexistence.” Id.
• “Not once prior to [plaintiff’s] injury did the FDA suggest that state tort law stood as an obstacle to its statutory mission.” Id.
• “[T]he ‘complex and extensive’ regulatory history and background relevant to this case, undercut the FDA’s recent pronouncements of pre-emption.” Id. at *13.
• “[T]he Government’s explanation of federal drug regulation departs markedly from the FDA’s understanding at all times relevant to this case.” Id. at *13 n.13.

We’ll state again the we don’t agree with much/most of what the majority found in this regard, particularly about the history of the FDA’s statements about preemption (see, e.g., here), but the Court has spoken, so the law is now what it is. Given that the FDA is under new management, from our perspective, this aspect of Levine may turn out to be the opinion’s least worrisome aspect.

Further, the majority took some care to frame the preemption argument that it shot down as: “Once the FDA has approved a drug’s label, a state-law verdict may not deem the label inadequate, regardless of whether there is any evidence that the FDA has considered the stronger warning at issue.” Levine, 2009 WL 529172, at *10 (emphasis added); see also id. (characterizing main defense argument as “the agency must be presumed to have performed a precise balancing of risks and benefits and to have established a specific labeling standard that leaves no room for different state-law judgments”). This manner of restating the defense argument further demonstrates that the majority in Levine wasn’t willing to rule out preemption in other, more limited, circumstances.

What are those circumstances? And what does all this tell us about the future of implied preemption after Levine?

We keep going back to the comparison to Riegel. What Levine thus tells us is we have to have good, case-specific facts to have a chance with preemption. After Levine the maximalist argument (assuming it was ever anything more than a strawman) is gone. There won’t be preemption if the FDA didn’t (or can be made to appear not to) pay significant attention to the particular risk of the particular drug. Thus, the more FDA involvement the better. Here’s a list of all the things that we’ve plucked out of the majority opinion in Levine that Justice Stevens suggested might make a difference in the ultimate preemption result:

• Levine wasn’t about the failure to contraindicate an FDA-approved drug use (in other words, the plaintiff wasn’t saying “no” where the FDA had said “yes”). 2009 WL 529172, at *5.
• The defendant offered no evidence that its accumulated adverse experience reports couldn’t be reanalyzed to fit within the “new analyses of previously submitted data” provision of the post-2008 changes being effected regulation – 21 C.F.R. §314.70(c)(6)(iii). Levine, 2009 WL 529172, at *7-8.
• There was no “clear evidence that the FDA would not have approved a change to [the drug’s] label.” Id. at *9.
• The defendant did not “attempt[] to give the kind of warning required by the Vermont jury but was prohibited from doing so by the FDA.” Id.
• “[Defendant] does not argue that it supplied the FDA with an evaluation or analysis concerning the specific dangers posed by the IV-push method.” Id.
• Unlike Geier, in Levine there wasn’t “a formal rulemaking” followed by an agency “plan” that “revealed the factors the agency had weighed and the balance it had struck.” 2009 WL 529172, at *12.
• “[W]e have no occasion in this case to consider the pre-emptive effect of a specific agency regulation bearing the force of law.” Id.
• The record “belie[s]” the contention that “the FDA determined that no additional warning. . .was needed, thereby setting a ceiling on [the] label.” Id. at *13 n.14.

And at the end of the opinion, the kicker: “[W]e recognize that some state-law claims might well frustrate the achievement of congressional objectives, this is not such a case.” Id. at *13.

So where does preemption still have a decent chance? Well formal, drug-specific rulemaking would be nice, but that’s not going to happen very often, if ever.

So effectively we’re left with the majority’s other distinctions. Has the FDA considered and rejected a stronger warning about the risk in question? Turned down or required significant modification of a CBE because the basis for the change wasn’t there? Said yes where the plaintiff says no? Any/all of those would be very good facts – after all, there wasn’t a majority against preemption of failure to contraindicate, so Levine became something else.

As we said in our prior post about what might happen if we lost Levine, one result will likely be an increase in requests for agency action. Increased agency action, after all, is required in any high, regulation, low litigation model – and that’s the only thing preemption can be after Levine. Did the FDA affirmatively conduct its own investigation and arrive at its own warning – a warning contrary to what the plaintiff demands? Affirmative, contrary FDA action is the best scenario left for preemption in litigation involving prescription drugs.

Other preemption friendly facts: Is the plaintiff trying to prohibit something that the FDA required, or vice versa? That’s another situation (essentially the “failure to contraindicate”) that the Levine majority explicitly distinguished. Did the defendant supply the FDA with risk specific information, either an “analysis” of its own or something that prompted the FDA to analyze the data itself? If that’s the case, and the manufacturer then did what the FDA told it to do, then there’s a good argument that Levine should not apply – provided, of course, that the FDA’s effort involved the same risk the plaintiff is suing over. Other “clear evidence” of more than “passing attention” by the FDA might also work (we can't possibly predict all the permutations) – but we have to note that the demand is for “clear” evidence, not just any evidence.

All of these points go back to one core principle. There must be effective FDA oversight for preemption to apply. That’s what won for our side in Riegel and that’s what the majority found was not present in Levine. The Court has made clear that it is not going to apply preemption in a regulatory vacuum. De facto deregulation is no longer a viable use of preemption – certainly not in the FDA arena.

We think that looking at FDA-related preemption this way – as a function of effective agency oversight – reconciles the otherwise jarring disconnect between the Court’s statements in Levine and Riegel that we highlighted at the outset of this post. The PMA process effectively ensures detailed FDA oversight, and combined with Congress’ language, justifies broad preemption. There’s no such language for drugs, so preemption has to depend entirely on whether, in a particular case, there has in fact been detailed oversight of the sort the Court was willing to find on a more generalized basis in Riegel. The majority refused to find such oversight in Levine. From here on out, it becomes our job to demonstrate differently.

Not Just Colacicco

We mentioned yesterday that the previously held cert. petition for Colacicco was distributed for consideration at the Justices' conference tomorrow. We decided to check the docket for
Pennsylvania Employees Benefit Trust Fund v. Zeneca, Inc., No. 07-822, as well. Sure enough, this petition has also been re-distributed. Thus, it's likely that there will be orders in both cases as early as tomorrow. As we pointed out with respect to Colacicco, the most likely outcome is a GVR (grant, vacate, remand (in light of Levine)) order.

Press Coverage of Levine

We'll have more to say later, but here's a rundown of some of the press coverage of Wyeth v. Levine: The New York Times (quoting (among others) Herrmann); AmLaw (quoting (among others) Bexis); the Washington Post (quoting (among others) Herrmann); the Wall Street Journal (subscription only) here, here, and here (not quoting us at all); the Philadelphia Inquirer (ditto); USA Today (ditto); LA Times (ditto).

There'll be more, but that's enough to keep us busy for now.

Colacicco Set For Friday, March 6, Conference

The Supreme Court has apparently been holding the cert petition in the SSRI antidepressant-suicide case of Colacicco v. Apotex until the Court decided Wyeth v. Levine.

The Supreme Court's docket now shows that the cert petition in Colacicco will be decided at this coming Friday's conference. Industry would naturally like to see cert denied in Colacicco, but the smart money's betting on a grant of cert, vacating of the Third Circuit's decision, and immediate remand to the Third Circuit for reconsideration in light of Levine.

Hat tip to the Life Sciences Legal Update Blog.

Wyeth v. Levine - First Real Thoughts

First, a minor correction. We lost by 6-3, not 6-2 (when you're typing fast you're all thumbs). We lost Kennedy, Thomas, and Breyer. We needed to win at least two of them.

The court relied on two facts established by the trial: (1) that a stronger warning would have made a factual difference (eliminating consideration of possible medical malpractice), and (2) that this was only a failure to warn and not a duty to contraindicate case. Slip op. at 7-8. Thus it avoided having to deal with a lot of the facts we thought in our prior posts (click on the "Levine" label) were pretty good for our side.

It's now clear that (1) congressional intent is the "touchstone" of implied preemption cases as well as express preemption cases, and (2) the presumption against preemption applies to implied preemption cases. Slip op. at 8. The latter ruling was presaged earlier in the term by Philip Morris v. Good.

Looking at congressional intent, the majority found no intent to preempt state-law duty to warn cases. It found the opposite, viewing the 1962 Amendments as adding a "saving clause" and noting that there was no express preemption provision similar to that enacted for the Medical Device Amendments in 1976. Slip op. at 10. The 2007 "rule of construction" "ma[d]e it clear that manufacturers remain responsible for updating their labels." Slip op. at 11.

The CBE regulation, allowing strengthening of certain types of warnings, defeats preemption by reason of impossibility. Slip op. at 11-12. Even under the 2008 amendment a unilateral label change is allowed for "new analyses of previously submitted data." The defendant could have re-analyzed its accumulated adverse drug reaction data under even the 2008 version of the CBE regulation. Slip op. at 13. This is an important ruling because it implies (but does not hold) that the result won't be any more favorable to preemption in post-2008 injury cases.

"The FDA's belief that a drug is misbranded is not conclusive" in civil trials because juries have to resolve misbranding prosecutions. Slip op. at 13. Thus the majority concludes that a threat of FDA enforcement action does not result in preemption by reason of impossibility. The majority views such actions as unlikely in any event. Slip op. at 13-14.

The majority rejects the argument that labeling is primarily the FDA's responsibility, rather than the manufacturer:

[I]t has remained a central premise of federal drug regulation that the manufacturer bears responsibility for the content of itslabel at all times. It is charged both with crafting anadequate label and with ensuring that its warnings remain adequate as long as the drug is on the market.

Slip op. at 14.

If the FDA actually rejected a CBE label change (which did not happen in Levine) there might be preemption. Slip op. at 15 ("absent clear evidence that the FDA would not have approved a change"). The majority found no evidence of that in this case:

And while [defendant] does suggest that the FDA intended to prohibit it from strengthening the warning about IV-push administration because the agency deemed such a warning inappropriate in reviewing Phenergan’s drug applications, both the trial court and the Vermont Supreme Court rejected this account as a matter of fact. In its decision on [defendant's] motion for judgment as a matter of law, the trial court found "no evidence in this record that either the FDA or the manufacturer gave more than passing attention to the issue of" IV-push versus IV drip administration."

Slip op. at 15. The implication here is that there's room for a different result if the FDA had made "an affirmative decision" and had gave a particular issue "more than passing attention."

That's (or more accurately, is not) impossibility preemption.

But the majority rejects implied conflict/obstacle preemption as well, holding that "relies on an untenable interpretation of congressional intent and an overbroad view of an agency's power to pre-empt state law." Slip op. at 17. Ouch.

There follows a discussion of congressional intent. The majority's major point is that, "[i]f Congress thought state-law suits posed an obstacle to its objectives, it surely would have enacted an express preemption provision at some point." Slip op. at 18. Thus the majority allows implied preemption to be driven by express preemption (or, more properly, the lack of it) more than it has in previous cases.

The majority then clobbers the FDA's 2006 preemption preamble: (1) it's not tied to any preemption-related regulation, slip op. at 19-20; (2) the Court doesn't defer to agency conclusions specifically about preemption, slip op. at 20; (3) the FDA didn't give proper notice and comment with respect to the preamble, slip op. at 21; (4) the preamble is "at odds" with congressional intent as interpreted by the majority, slip op. at 21; (5) the preamble "reverses" the FDA's own position on preemption, slip op. at 21-23. This is a significant rebuke to the positions taken by the Bush administration FDA.

Finally the majority distinguishes Geier v. American Honda Motor Co., 529 U.S. 861 (2000), as involving "formal rulemaking and then. . .a plan to phase in a mix of [options]." Slip op. at 24. In Levine, by contrast, there was no FDA "regulation bearing the force of law." Slip op. at 24. Unlike Geier, the court read the relevant regulatory history as a "longstanding coexistance of state and federal law" at "each" time the FDA took regulatory action concerning the drug Phenergan. Slip op. at 24. Significantly the majority refrains, in its statements about Geier, from making formal rulemaking an absolute prerequisite to preemption as the plaintiffs had argued.

So what's left? This: "we recognize that some state-law claims might well frustrate the achievement of congressional objectives, this is not the case." Slip op. at 25.

So what might those claims be? Two things jump out. As discussed, there's the situation actually involving "formal rulemaking." The second would be a situation where, unlike the way the majority read the FDA regulatory history in Levine, the FDA did, in fact, consider a particular risk in considerable depth and made an affirmative decision to reject a warning of the sort that a particular plaintiff demands. SSRIs come to mind, and some other situations as well. But defendants are going to have to litigate more selectively - and take great pains to develop a solid regulatory history.

We've been on the wrong side of Supreme Court preemption decisions before. In the middle of Bone Screw Lohr came down and knocked us for a loop. Levine isn't good news for our side by any means, but it's no Lohr. The Court did not hold that there's no preemption at all, or no preemption without an express regulation, either of which it could have done. It didn't impair either Riegel (which, being an express preemption case, is completely different) or Buckman. In short, Levine doesn't make preemption impossible, just a lot more difficult. After Levine it's pretty clear though that implied preemption is going to depend quite a bit on what the FDA has to say about specific drug risks, and not very much on what the FDA has to say about preemption.

That's it for now. We'll look through the concurrences and dissent later.

Wyeth v. Levine Decided - No Preemption

Wyeth v. Levine was decided this morning and the Court rejected preemption by a 6-2 vote, Justice Stevens writing for the majority.

The basics. (1) there is no premption by impossibility because the FDA's changes being effected ("CBE" ) regulation permits certain preapproval labeling changes that add or strengthen a warning to improve drug safety. There was no evidence the FDA would have rejected such a change. (2) as for ordinary conflict preemption, there is no evidence of congressional intent to preempt state tort inadequate warning actions. The FDA's 2006 preemption preamble, entitled to only Skidmoore deference, is not persuasive in light of several factors. (3) Geier is distinguishable because it involves actual notice-and-comment rulemaking - which may present a different situation.


As regular readers of this blog know, Diana Levine was a children's guitarist in Vermont. In April 2000, she went to a clinic for treatment of a severe migraine headache and associated nausea. She was originally treated with intramuscular injections of Demerol (for headache) and Wyeth's drug, Phenergan (for nausea). Intramuscular injection was the preferred method for administering Phenergan identified in the product's labeling.

When that treatment did not provide relief, Levine returned to the clinic, and a physician's assistant administered a second dose of Demerol and Phenergan intravenously by IV push injection -- injecting the medication into the tubing of an IV infusion set that led to a needle inserted into what the assistant thought was a vein.


At the time of Levine's treatment, the package insert for Phenergan warned in four separate places about the risk of gangrene arising from inadvertent exposure of arterial blood to the drug. Among other things, the "Adverse Reactions" section of the label said, in bold, upper-case letters: "INTRA-ARTERIAL INJECTION [CAN] RESULT IN GANGRENE OF THE AFFECTED EXTREMITY."


The FDA had regularly reviewed Wyeth's labeling for Phenergan, and the Agency was aware of the risk of gangrene if arterial blood was exposed to the drug. In 1997 (the last review before Levine's treatment) the FDA ordered Wyeth to make various changes to the labeling of Phenergan, but directed the company to "[r]etain verbiage in current label" about inadvertent intra-arterial injection.


Unfortunately, after Levine's treatment, she developed the symptoms of arterial exposure and gangrene, requiring amputation of her forearm.


Levine sued the health clinic, physician's assistant, and supervising physician for malpractice, and she settled those claims for $700,000. She then sued Wyeth in state court in Vermont, pleading state law claims for inadequate warning. At trial, Levine's lawyer and expert witness both argued that Wyeth should have contraindicated intravenous injection of Phenergan on the drug's label, forbidding that method of administration -- even though the FDA never required such a contraindication and instead required Wyeth to use only the language the Agency had approved.


Wyeth argued in motions for summary judgment and judgment as a matter of law in the trial court that Levine's claims were preempted -- because the FDA dictated the warnings included on Phenergan's labeling as a matter of federal law, state law could not require Wyeth to give different warnings that would have conflicted with federal law.


The trial court rejected that argument, and the jury entered a verdict of $7.4 million against Wyeth. The judgment was later reduced to $6,774,000 to account for prejudgment interest and the settlement of the earlier malpractice suit.


On appeal to the Vermont Supreme Court, Wyeth again explained that Levine's claims were preempted because Wyeth could not comply with both its federal duty to distribute Phenergan only under the precise labeling approved by the FDA and its Vermont common-law duty to give different warnings. In a split decision, the Vermont Supreme Court affirmed, rejecting Wyeth's preemption argument.



The United States Supreme Court granted certiorari in Wyeth v. Levine on January 18, 2008, and heard argument on November 3.


For those who are curious, we've previously posted about Wyeth v. Levine many times, including here (analyzing the transcript of the argument), here (describing the defense amicus briefs), and here (collecting our thoughts after the grant of cert last January).


The Supreme Court issued its decision just moments ago.


After we've had a chance to read the opinion, we'll publish a post analyzing the legal implications of Wyeth v. Levine. (We won't take too long to do that. We promise!)

Unrefundable

About a month ago we posted on a New Jersey intermediate appellate decision, Hoffman v. Hampshire Labs, 963 A.2d 849 (N.J. Super. A.D. 2009(, that interpreted the "ascertainable loss" requirement of the state's consumer fraud act ("CFA") as requiring the purportedly aggrieved consumer to invoke a money-back guarantee before bringing suit. We viewed the "takeaway" from Hoffman as that a plaintiff had to seek a refund (at least where there was such a guarantee) in order to bring suit.

Maybe we shouldn't go coloring outside the lines. After all, as we posted last year, the New Jersey Supreme Court in Sinclair v. Merck & Co., 948 A.2d 587, 590 (N.J. 2008), held that CFA was subsumed by the state's product liability act and thus did not provide a separate cause of action.

Anyway, two weeks later, we've now discovered (we get sent good news, but not bad news, it seems), the New Jersey Supreme Court held that, generally, a request for a refund is not a prerequisite to bring suit under the CFA:

In theory, there may be circumstances in which requiring a pre-suit demand for relief might be appropriate or in which a consumer's failure to seek a refund or other remedy in advance of turning to the courts for relief should operate to limit the recovery otherwise available under the CFA. Nevertheless, because the language and the intent of the statute are clear and its purposes are plain, we consider the concerns raised by defendant and by amici to be matters that call for an examination and a weighing of public policy considerations not within the language of the CFA itself. As such, they are for the Legislature, and not for this Court, to entertain.

Bosland v. Warnock Dodge, Inc., ___ A.2d ___, 2009 WL 414336, at *10 (N.J. Feb. 19, 2009). Whether there's anything left of Hoffman in the limited circumstance of an express money-back guarantee, we don't know, but this ruling pretty well kills the general proposition that a request for a refund is inherent in the concept of "ascertainable loss."

Anyway, since our Hoffman post might steeer our readers wrong, given subsequent precedent, we felt an obligation to steer them right.

One other thing, though. As we mentioned earlier, the N.J. Supreme Court also took an appeal in the McDarby case, which notoriously features a judge-made exception to the Product Liability Act that the legislature did not see fit to create. We hope the Court, in deciding McDarby, keeps the same of legislative deference in mind when to apply it would gore a plaintiff's, as opposed to a defendant's, ox.

Pre-Service Removal -- For The Umpteenth Time

We're fixated on the subject: When a plaintiff files a complaint in state court that names both residents and non-residents of the forum state as defendants, can the non-resident defendant remove before the plaintiff serves the in-state defendant?

(We know that's cryptic shorthand, but regular readers of this blog have seen more expansive descriptions of the issue in many previous posts, including here, here, and here, among others. We even ventured off into the print media on the subject.)

We're not alone in our fixation. Litigants keep raising, and courts keep addressing, this issue, too.
Most recently, in In Re: Avandia Marketing, Sales Practices And Products Liability Litigation, 2009 U.S. Dist. Lexis 15210 (E.D. Pa. Feb. 25. 2009), the court considered a slew of removals of California pharmaceutical product liability lawsuits. The removals ran the gamut of pre- and post-service fact patterns. In some cases, removal was after service. In others an out-of-state defendant (GSK, a Pennsylvania citizen) removed before the in-state defendant (McKesson, a California distributor) was served. In still others, removal occurred before anybody at all was served - thanks to the miracles of modern technology.

The court discussed the "forum defendant rule," observing that because diversity jurisdiction was created to protect out-of-state defendants from "prejudice" in a plaintiff's home court, Congress determined that defendants sued in their own home courts "do not require access to the federal courts." Lexis slip op. at *41. The "filed and served" exception was to prevent plaintiff-side hanky panky - naming an in-state defendant as a sham to prevent removal. Congress hadn't caught up with technology and the phenomenon of on-line dockets:

[T]he rule is silent as to arguably equivalent defense tactics, in particular, the phenomenon -- enabled by modern litigation technology - of the forum defendant removing an action before being served with process due to its ability to electronically monitor state court filings. A literal reading of the "properly joined and served" language of § 1441(b) would suggest that the statute allows even a forum defendant into federal court provided it can win such a "race to remove."

Lexis slip op. at *42. After examining both sides of the issue, the court decided to help Congress along by "reject[ing] any construction. . .that would allow an in-state defendant to side-step the restrictive purpose of the forum defendant rule by 'racing to remove' before being served with process." Id. at *44. To read the statute literally would produce a result "absurd on its face" that "could not have been intended by Congress." Id.

The court then turned to the nobody-served group of cases. While the nuances were a little different, the court came out in the same place - that the statute should be read to prevent a "race to remove" (even if that's not exactly what it actually says):

Discussing the rationale for the latter approach, district courts have noted that "when no defendant has been served . . . the non-forum defendant stands on equal footing as the forum defendant . . . [n]either defendant in that scenario is obligated to appear in court[, n]or has the thirty day period for removal started to run." Courts also note the real concern of encouraging an unfair "race to remove" by technologically sophisticated non-forum defendants through a rule that permits removal prior to any service. The reasoning of the latter rulings is persuasive to the Court, and will be followed herein.

Lexis slip op. at *45-46 (citation containing footnotes omitted).

The only situation where pre-service removal was proper, the Avandia court held, was where the out-of-state defendant was served before the in-state co-defendant. "In that situation, the rationale behind the "joined and served" requirement. . .and, to some extent, the protective purpose of diversity jurisdiction, are implicated, and removal by the foreign defendant is proper." Id. at *47.

That's one (actually about a dozen all wrapped in one) - but this is a two-fer.

Down in Delaware, Eileen Hutchins filed a product liability suit involving the drug Trasylol in Delaware state court. Hutchins v. Bayer Corp., No. 08-640-JJF-LPS, 2009 WL 192468 (D. Del. Jan. 23, 2009). She named as defendants Bayer Corporation (a Pennsylvania citizen), Bayer Health, LLC (a citizen of Delaware and Connecticut), Bayer Healthcare Pharmaceuticals, Inc. (a citizen of Delaware and New Jersey), and Bayer AG (a German corporation). If either of the Delaware citizens had been served with the complaint, then the case would not have been removable, because a case is removable "only if none of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought." 28 U.S.C. Sec. 1441(b).

But what if the plaintiff has not yet served anyone, so none of the parties "joined and served" was a citizen of Delaware? That was what happened here, where Bayer Corporation removed the case before any defendant had been served.

Hutchins moved to remand; Bayer filed a motion to stay the federal case so that it could be transferred as a tag-along action to a federal multidistrict litigation proceeding pending in the Southern District of Florida. (Stay and transfer would have caused the federal MDL judge, rather than the federal judge in Delaware, to address the remand motion, which is what happened in Avandia.)

Magistrate Judge Leonard Stark reasoned that (1) there were no other cases in the federal MDL presenting the "joined and served" issue, and (2) there was nothing about the remand issue that made the MDL judge uniquely qualified to decide it, so he denied Bayer's motion to stay a decision on the remand question. Id. at *4.

He then promptly ruled in favor of Bayer on the merits and stayed all other proceedings pending the MDL Panel's decision whether to transfer the case to the Southern District of Florida.

The magistrate judge recognized that removal statutes are generally strictly construed, so doubts about removability should be resolved in favor of remand. Id. at *4-*5. And he acknowledged that statutes must not be construed to lead to bizarre or absurd results. Id. at *5-*6. And statutes should not be construed to lead to results that Congress did not intend. Id. at *6-*7. And plaintiffs usually get to choose their own forum. Id. at *7. And the party seeking removal bears the burden of proof. Id. at *8.

Geez -- at this point, we were thinking that the deck was hopelessly stacked against Bayer.

But the court then read the statute. And the court knew that it must enforce the plain language of an unambiguous statute, and every word in a statute must be given effect, and an unamended statute probably means what courts have said it means, and so on. Id. at *8-*10.

Finally, the court trotted through the many cases that have reached conflicting decisions about whether courts should remand cases that defendants have removed before service on a resident defendant.

Ultimately, the statutory language prevailed: "The language of Section 1441(b) is plain and unambiguous. . . . Accordingly, this action 'shall be removable' and the motion to remand should be denied." Id. at *11. The magistrate judge thus recommended (which is all he was empowered to do when deciding a motion to remand in the Third Circuit, id. at *3) that the motion to remand be denied.

When we spied this issue a long time ago, we predicted that it would both recur and trouble the courts. We've been right on both scores, and we're not particularly happy about it. Here's yet another of diametrically opposed decisions leaving us all - both plaintiffs and defendants - not knowing what we should do. We sure hope an appellate court soon decides the question, so that parties don't continue to spend money litigating what should be routine threshold jurisdictional issues.

We need a definitive answer. What is to control? The text of the statute or presumed congressional intent and the rule against "absurd" results?

Product Liability Comes To Thailand - Drug/Device Implications

Our first ever overseas guest post comes all the way from Thailand, where Douglas Mancill of the Deacons law firm reports on new Thai laws on product liability and their possible impact on/creation of product liability claims involving drugs and medical devices.

Needless to say neither Bexis nor Herrmann had anything to do with the substance of this post, as neither of them knows much about Thailand beyond liking the food.

Take it away Doug.

Damage awards in Thailand for defective goods claims have traditionally been very low compared to the U.S., but two new laws aim to change or, at the very least, tighten this gap. On 21 February 2009, the Unsafe Product Liability Act, B.E. 2551 (the Product Liability Act) came into force. Six months earlier, in August of 2008, a procedural law which supports many of the new concepts introduced by the Product Liability Act, the Consumer Case Procedures Act, B.E. 2551 (the CCPA), came into force. These two laws, together, stand poised to materially change the tort law terrain of Thailand.

One issue of great significance to drug and device maker is that plaintiffs in Thailand will not carry the burden of proving a product is defective. Product liability laws in the U.S. and the EU dispense with the negligence requirement and impose strict liability once a product is established to be “defective”, but the plaintiff still carries the burden of proving that a product is, in fact, defective. Not so in Thailand.

Section 6 of the Thai Product Liability Act provides that the plaintiff only carries the burden of proving that damage was caused by a product in “ordinary use or storage”. Once a plaintiff makes this bare minimum showing, the burden shifts to “business operators” (a defined term, but for purposes of this discussion, suffice to say that it clearly covers drug and device manufacturer) to prove the product was “not unsafe”. Stated more directly without the diplomatic double negative, business operators carry the burden of proving a product was safe if an injury occurs from that product.

This is an intentional feature of the new legal terrain created by the Product Liability Act and the CCPA. The CCPA and the Product Liability were passed at the same time by the same appointed legislative body (although the Product Liability Act did not come into force until six months later), and the CCPA contains an evidentiary burden provision which dovetails with and reinforces Section 6 of the Product Liability Act. Section 29 of the CCPA provides that if the Court believes that facts relating to “production, assembly, design or mixtures of the goods, the provision of services or other undertakings” are exclusively known by a business operator, that business operator carries the burden of proof relating to such matters. The Product Liability Act expressly recognizes design defects, meaning that a drug or device manufacturer carries the burden of proving that the design of a medical device or the formulae of a drug is safe when a product liability case is filed in a Thai Court.

The Product Liability Act is a thin law – consisting of 16 clauses and about four pages of text – and in some ways the issues it does not address may be more significant than those that are addressed. There is, for example, no test or stated principle for determining what constitutes a defective product (e.g., the reasonable consumer test, the risk utility test) and in a civil law system where the burden is on the manufacturer to prove a product is a safe, this could be problematic, particularly for drug and medical device makers. Nor does the Act mention the learned intermediary rule.

Although drugs and medical devices have indisputably improved the quality of our lives immensely, they can also cause very real injuries. In Thailand, this means that every time a consumer suffers an injury – perhaps, say, from a drug that otherwise saves millions of lives - she or he will have a potential product liability claim against the manufacturer of that drug or device. And more important, drug and device makers will carry the burden proving that a formula or design was safe. Complicating matters further, the law sets no standards or even provides any guidance on what constitutes a safe design. And because the principle of ratio decidendi does not exist under Thai law, even Thai Supreme Court decisions may not be able to fill this gap.

If a business operator fails to convince a Thai court that the formula of a drug or the design of a device was safe, that determination can be used against the manufacturer in future cases by other plaintiffs pursuant to CCPA Section 30. Section 30 permits factual findings against a defendant in one case to be used against that same defendant in another case. Once the design of a drug or device is found to be defective in one case, it could be used against that same manufacturer by other plaintiffs in other cases. For Thai law, which also doesn’t have a concept of stare decisis (or class actions), this is a major change. And these findings only cut one way – new plaintiffs are not bound by prior findings that the product was safe. This means that every time a design defect claim is filed, manufacturers must aggressively defend that design lest one court decides the design was defective. A finding by one court that the formulae of a drug or the design of a medical device is defective opens up the maker of that drug or device to claims by every person who claims to have been injured by the drug or device.

The CCPA also permits Thai Courts to issue orders requiring business operators to make announcements about and recall unsafe products. These are essentially mandatory injunctions, and because it is generally difficult to procure injunctions of any kind in Thailand (including prohibitory ones enforcing intellectual property rights), it is unclear how the courts will exercise this specific grant of power in practice.

These problems have not gone unnoticed. A proposal to exempt drugs, medical devices and medical professionals from these laws has been put forward. You may be wondering why it includes the medical profession. While the Product Liability Act only applies to products (drugs and devices), the CCPA extends to “services”, including the services rendered by physicians, and it contains many provisions very similar to the Product Liability Act.

Moreover, although the CCPA is not yet six months old, it has been employed very effectively in a number of cases and garnered popular support in a country not well known for US or EU safety standards. For example, an airline passenger used the CCPA to recover emotional distress damages when an airline failed to use a metal detector to screen airline passengers. The metal detector was apparently “on loan” to a local university. (Don’t ask – it doesn’t make sense to us either.) A lawyer plaintiff is now using the CCPA in a high profile case where a fire on New Year’s Eve at a popular Bangkok nightclub fire claimed 66 lives. The lawsuit essentially claims the pub was a fire trap and seeks recovery directly against 33 directors and owners of the pub. This latter aspect of this case is significant because of the alleged identity of some of those owners (say, a high official in an organization responsible for policing the pub) and because the CCPA contains a provision allowing claimants to pierce the corporate veil, something that is otherwise virtually impossible to do in Thailand. All of this, of course, has little to do with medical drugs or devices, but it does help explain the popularity of these new laws, and why proposals, at least at this time, to reduce their scope or exempt certain products might not receive a warm reception in the Land of Smiles.

Abdullahi v. Pfizer and the Alien Tort Statute

Is that title a mouthful, or what?

On January 30, the Second Circuit decided Abdullahi v. Pfizer, No. 05-4863-cv(L), 05-6768-cv(CON), slip op. (2d Cir. Jan. 30, 2009) (link here). In a nutshell, plaintiffs pleaded that Pfizer, "working in partnership with the Nigerian government, failed to secure the informed consent" of children (or their guardians) who were enrolled in an allegedly dangerous clinical trial of the drug Trovan. The trial court dismissed the complaints for lack of subject matter jurisdiction under the Alien Tort Statute. On appeal, the Second Circuit panel majority (with Wesley, J., dissenting) held that Nigerian residents can sue a U.S. drug company under international law in a U.S. court.

Let's step way back.

Suppose the Ugandan government engages in genocide. A resident of Uganda is unlikely to have much luck suing the Ugandan government in a Ugandan court for damages. The plaintiff would probably do much better if he or she could sue a private actor (rather than a government, which may have some form of sovereign immunity) in a more favorable court (let's say, one in the United States) under a more generous legal theory (say, international law).

Enter the Alien Tort Statute, which gives federal courts in the U.S. "original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States." 28 U.S.C. Sec. 1350.

Presto! If our poor Ugandan can find an American company that supposedly aided the Ugandan government in violating the law of nations, then our Ugandan can present his or her claim to an American jury. That's a switch in defendant (private actor), law (the "law of nations" instead of the law of Uganda), and forum (American jury instead of whoever the heck decides cases in Uganda) that could do a plaintiff a world of good.

In a very narrow set of circumstances, allowing these types of claims may make good sense. But if the Alien Tort Statute is loosened from its mooring, American companies will be in a heap of trouble awfully fast.

"As a moth is drawn to light, so is a litigant drawn to the United States." Smith Kline & French Labs v. Bloch, 2 All E.R. 72, 74 (1983). If American courts are opened to litigants from around the world, our courts will quickly spend much of their time resolving disputes that properly belong in the courts of other countries.

If, for example, a large American company has a factory in China, then a class of tens of thousands of Chinese plaintiffs might sue that company in an American federal court for conspiring with the Chinese government to deny the plaintiffs their political rights. It's American-style litigation for everyone!

That's why the Abdullahi decision is so dangerous. When courts properly read "the law of nations" narrowly, they limit the number of claims by foreigners that can be brought in American courts. But, in Abdullahi, the Second Circuit read the "law of nations" broadly. The court found that the duty to obtain informed consent for clinical trials is not simply a matter of U.S. (or other countries') domestic law, but rather is customary international law. To reach that conclusion, the panel majority relied on the International Covenant on Civil and Political Rights (which does not create privately enforceable rights), non-binding ethical guidelines of private organizations (which hardly constitute "the law of nations"), the Nuremberg Code (which applied only in the context of a "war crime"), and assorted other directives (all of which post-dated the 1996 clinical trial involved in the lawsuit).

This expansive interpretation of the Alien Tort Statute is bad news for drug companies, as well as all other companies that do business internationally. Although Abdullahi arises in the context of a clinical trial (and many drug companies conduct clinical trials overseas), the case is not limited to that context. Abdullahi will surely be cited by many future foreign plaintiffs trying to obtain access to American courts and generous American juries.

Here's the good news: Pfizer has petitioned for a rehearing or rehearing en banc in Abdullahi and, since Judge Wesley dissented, that petition will have some support within the court. If that route fails, many justices on the U.S. Supreme Court have expressed their concerns about grafting foreign laws or the customary law of nations into causes of action that are recognized by American courts.

Although our crystal ball is cloudy, we're guardedly optimistic that the expansive view of the Alien Tort Statute espoused by Abdullahi will be be rejected by either the en banc Second Circuit or the U.S. Supreme Court. If that happens, we'll be there to report on the development.