Stop us if you have heard this before.  A group of plaintiffs bring a purported class action under a range of California consumer protection laws seeking damages related to the purchase of a medical product (or collection of somewhat related medical products) that they claimed failed to comply with FDA requirements.  The defendants raise preemption and/or primary jurisdiction in a motion to dismiss.  We blog about the resulting decision.  While the problem may be with the last step, our blogging, it does seem like these economic injury classes have to get by a number of legal hurdles that should trip them up.  We suspect—gasp—that the lawyers who bring these cases look for things to sue over first and then find their putative class representatives later, suggesting a business model for imposing costs on the manufacturers of medical products.

This applies to supplements too.  While we do think there is something fundamentally different about prescription medical products from the brightly-packaged products on the counter at convenience stores or sold over the television or internet with vague claims of what the products actually do, the class actions brought against the manufacturers of the latter group of products often seem contrived.  We do not offer this from the vantage point of having defended those cases or as prelude to offering a detailed recap of the treatment of dietary supplements under the FDCA.  Rather, we surmise that many purchasers of such products buy them—the ones who buy them to use them, not buy them to serve as class reps—because they have not been evaluated by FDA, because they can take them without prescriptions or required monitoring, because they are curious about trying something, and/or because shiny packaging catches their eye at the check-out counter.  We doubt these purchaser care much about whether sound scientific evidence and regulatory evaluation were required before the supplement entered the stream of commerce.  We could be wrong.  There is a rumor than we have been before.

Rosas v. Hi-Tech Pharms., No CV 20-00433-DOC-DFM, 202 U.S. Dist. LEXIS 164565 (C.D. Cal. July 29, 2020), involves a proposed class under an alphabet soup of California consumer statutes and common law misrepresentation for four supplements made by defendant that contain combinations of three chemicals—two old decongestants/stimulants denoted as DMAA and DMHA and an amphetamine called methylsynephrine.  The supplements have names suggesting they might help someone work out and/or lose weight.  The gravamen of the complaint was that it was not legal to sell supplements in the U.S. containing any of these chemicals, particularly after FDA issued a warning letter to the defendant in April 2019 about its use of DMHA and to other manufacturers over the last eight years or so about the use of DMAA and methylsynephrine.  (It takes a few seconds to find various statements from FDA about these chemicals and their use in supplements.)  Defendant moved to dismiss on primary jurisdiction, preemption, standing, pleadings, and judicial abstention, but the court only reached the first one.

Swap in CBD for these stimulants and adjust the regulatory facts a bit, but keep the basic claims, defenses, applicable law, and the court the say, and you might experience a little déjà vu for a post from over the summer on the Colette case.  In that post, we harkened back to prior posts on the origin of the primary jurisdiction doctrine and whether FDA warning letters count as final agency actions.  In Colette, the non-final nature of what FDA had done to that point on CBD-containing supplements was what made the primary jurisdiction doctrine require putting the case on ice.  A mere two months later, the Rosas court did not cite Colette in deciding very similar primary jurisdiction issues.

In some ways, Rosas was an even easier application.  The defendant had sued FDA over its actions with regard to DMHA and, a month before Rosas was decided, the D.D.C. had dismissed the case because there was not yet a final agency action to review, presumably under the Administrative Procedure Act.  Given the way primary jurisdiction works, that dismissal provided a little foreshadowing for the result in Rosas.  The Ninth Circuit spelled out the factors for primary jurisdiction as follows:

(1) the need to resolve an issue that (2) has been placed by Congress within the jurisdiction of an administrative body having regulatory authority (3) pursuant to a statute that subjects an industry or activity to a comprehensive regulatory scheme that (4) requires expertise or uniformity in administration.

Id. at *6 (citation omitted).  The middle two factors were conceded, but the plaintiffs offered creative opposition to the other two.

Although FDA makes clear that its warning letters are not final as far as it is concerned—which the court noted—plaintiffs argued that an outlier Ninth Circuit case rejecting primary jurisdiction had concluded that FDA warning letters could be final actions.  Id. at **8-10.  The court noted that the warning letters in that case had built on an interim rule, but no such rule existed as to the supplements at issue here.  Accordingly, the court followed the general rule and concluded that no final agency action had occurred, despite the issuance of warning letters.  Id. at **10-11.  (If you want more musings on warning letters in cases like this, then try here.)

The last factor—that the regulatory scheme requires expertise or uniformity in administration—might have seemed like a walkover, but the plaintiffs claimed the Dietary Supplement Health and Education Act (“DHSEA”) was not so complicated that the court could not decide the issues plaintiffs would need to win.  Plaintiffs relied on an Eleventh Circuit seizure case, which decided on the application of the DHSEA to supplements containing DMAA.  Id. at *12.  The Rosas court declined, finding the issues presented in the case under the DHSEA were “‘technical and scientific questions’ best left to the FDA.”  Id. at *13 (citation omitted).  The court also noted the risk of differing interpretations that would undermine the regulatory scheme, something we know many courts do not think twice about.  Id.

With that, primary jurisdiction required that the complaint be dismissed.  The dismissal, of course, was without prejudice until there is a final agency action.  Once that happens, if the state law claims are based solely on FDA violations, then they may run into the preemption issue the court punted on here.

Not quite two months ago, the Dept. of HHS published a notice of proposed rulemaking that would make a significant change in the National Vaccine Injury Compensation program.  See 85 Fed. Reg. 43,791 (HHS July 20, 2020).  If this becomes a final rule, it could affect the prevalence of civil litigation involving vaccines.

HHS seeks to undo an Obama-era change that added two conditions to the table of compensable vaccine-related injuries:

On January 19, 2017, the Department issued a final rule amending the Table (Final Rule) that, among other things, added SIRVA [Shoulder Injury Related to Vaccine Administration] and vasovagal syncope [injection-triggered fainting] to the Table. . . .  The Final Rule followed a 2012 Institute of Medicine (IOM) report, . . . the work of nine HHS workgroups that reviewed the IOM findings; and consideration of the Advisory Commission on Childhood Vaccines (ACCV) recommendations.

The Department now proposes to remove SIRVA and vasovagal syncope from the Table. . . .

85 Fed. Reg. at 43,795 (citations and footnotes omitted).

Interestingly, the notice indicates that, to the extent they were consulted at all, the IOM, the HHS workgroups or the AACV oppose HHS’ reversal.  See Id. at 43802-03 (proposal “do[es] not meet the tenets of the . . . Guiding Principles” because it is not “made to the benefit of petitioners”).  We find the HHS proposal concerning because it explicitly seeks to create more tort litigation, supposedly as an attempt to “incentivize” proper vaccine administration.  Having lived through the DTP wars that brought about the Vaccine Act in the first place, we don’t think that vaccination and litigation – any litigation – are a good match.

The HHS proposal distinguishes SIRVA and, to a lesser extent, vasovagal syncope from the other vaccine-related injuries in the table because they relate to “administration” of vaccines by health-care providers, as opposed to the inherent risks of the vaccines themselves.  “SIRVA is, of course, not a vaccine, and it is not an injury caused by a vaccine antigen, but by administration of the vaccine by the health care provider.”  Id. at 43,796.

There is nearly uniform agreement in the scientific community that SIRVA is caused by improper vaccine administration, rather than by the vaccine itself. . . . [S]houlder lesions are more likely to be the consequence of a poor injection technique . . . rather than antigens or adjuvants contained in the vaccines.

85 Fed. Reg. at 43,795 (citations and footnotes omitted).  The proposal devotes less attention to vasovagal syncope, but asserts the same general conclusion.  “[V]asovagal syncope results from the act of injection, rather than the vaccine or its components.”  Id. at 43,796.

HHS is thus now taking the position that SIRVA occurs primarily because health care providers are “negligent” in how they inject vaccines – we kid you not.  “The scientific literature indicates that SIRVA likely results from poor vaccination technique, rather than the vaccine or its components alone.”  Id. at 43,795.

First, the Department has concluded that the Vaccine Act should be read as not applying to cover injuries, like SIRVA and vasovagal syncope, which involve negligence by the vaccine administrator.

85 Fed. Reg. at 43,796 (emphasis added).  “[N]egligent administration . . . can encompass anything from negligent needle placement to ‘the doctor’s negligent dropping of an infant patient.’”  Id. (quoting Amendola v. Secretary, Dept. of HHS, 989 F.2d 1180, 1186-87 (Fed. Cir. 1993)).  “[T]hat Congress asked the Secretary to ‘make or assure improvements’ in the ‘administration’ of vaccines . . . does not imply that the compensation program covers negligent administration.”  Id. (citation omitted).  So HHS now wants people to sue doctors and other health care providers instead.

However, what actually drove the Vaccine Act was a desire to decrease the transaction costs of compensation for vaccine-related injuries generally, because fear of injury was leading to resistance to vaccination:

[T]here were many complaints that obtaining compensation for legitimate vaccine-inflicted injuries was too costly and difficult.  A significant number of parents were already declining vaccination for their children, and concerns about compensation threatened to depress vaccination rates even further.

Bruesewitz v. Wyeth LLC, 562 U.S. 223, 227 (2011) (footnotes omitted).  These concerns would not seem to be limited to the subset of vaccine-related injuries acknowledged in the HHS proposal, but would exist regardless of who was responsible for the injury.

We also looked at the case HHS cited, and Amendola does not stand for exclusion of alleged negligent administration from Vaccine Act compensation.  If anything, it stands for the opposite proposition:

[Plaintiffs] conclude that the Act does not cover mere negligence, either by the manufacturer or the administrator.  However this is too broad a reading. . . .  There is no reference to merely negligent contamination, or to an occasion of negligence in deciding, for example, whether to administer an otherwise satisfactory vaccine. . . .  We see no basis for drawing a bright line that excludes erroneous judgment calls by the administrator. . . .

989 F.2d at 1186.

HHS also asserts that the Vaccine Act’s operative term, “vaccine-related injury or death,” 42 U.S.C. §300aa-11(a)(1), should not be interpreted as requiring something more than “but for,” causation, but should be construed as incorporating, sub silentio, the notion of administrator negligence as a superseding cause.  However, the Vaccine Act itself limits compensation by excluding only injuries “due to factors unrelated to the administration of the vaccine.”  42 U.S.C. §300aa-13(a)(1)(B).  And that’s defined, too:

(2) For purposes of paragraph (1), the term “factors unrelated to the administration of the vaccine”−

(A) does not include any idiopathic, unexplained, unknown, hypothetical, or undocumentable cause, factor, injury, illness, or condition, and

(B) may . . . include infection, toxins, trauma (including birth trauma and related anoxia), or metabolic disturbances which have no known relation to the vaccine involved, but which in the particular case are shown to have been the agent or agents principally responsible for causing the petitioner’s illness, disability, injury, condition, or death.

Id. §300aa-13(a)(2).  Nowhere are “causes,” “factors,” “injuries,” or “conditions” associated with the physical administration of a vaccine statutorily excluded from compensation.  HHS’ superseding cause-based proposal also seems at odds with the nature of the Congressionally intended “no-fault compensation program” itself, in which “[n]o showing of causation is necessary.”  Bruesewitz, 562 U.S. at 228.  The proposal’s attempt to account for this language seems rather forced:

To be sure, the Vaccine Act does in certain places refer to “administration of” or the “administrator” of the vaccine.  But we think that those usages were not meant to suggest the Program covers negligence in the administration of the vaccine, but served other purposes.  At most, these usages render the statute ambiguous with respect to needle injuries.

85 Fed. Reg. at 43,797.  We don’t think so − the statute actually defined the term “factors unrelated to the administration of the vaccine” : − and expressly limited the exclusion to pre-existing conditions.

Thus, to “incentivize” health care providers to administer vaccines more safely, HHS is thus proposing that they should get sued more often.  “Congress wanted to preserve a state tort remedy for certain avoidable injuries, such as those caused by negligent vaccine administration.”  85 Fed. Reg. at 43,797.  “[A]warding no-fault compensation . . . to those with SIRVA and vasovagal syncope claims lessens the incentive to take appropriate precautions.”  Id. at 43,798.  HHS prefers that the public sue negligent vaccine administrators than having to seek contribution itself:

[The Vaccine Act’s] subrogation provision does not properly incentivize the vaccine administrator, since it is unlikely that the Federal government would assert many claims against administrators, given the burden and expense compared to the relatively small potential recovery for the Federal government. Individuals would have a greater incentive to assert such claims if the administrator were negligent.

Id. at 43,801 (emphasis added).  So we are not exaggerating here.  An express purpose of the HHS proposal is to encourage litigation against health care professionals who administer vaccines, and thus to impose “the burden and expense” of litigation on others.

Digging a little deeper, we believe that is possible, even probable, that HHS’ entire discussion of incentives and negligent administration is pretextual.  Another aspect of HHS’ “review” is “the Department’s experience since SIRVA and vasovagal syncope were added.  85 Fed. Reg. at 43,795.  The driving force behind this proposal appears to be to save money, since SIRVA claims in particular now make up more than half of the Vaccine Act docket.  Id. at 43,798.

From FY 2016 through FY 2019, approximately $119,154,985 has been paid out of the Vaccine Injury Compensation Trust Fund (Trust Fund) to compensate SIRVA petitioners, who are overwhelmingly adults. The sheer prevalence of shoulder injuries in the country’s adult population and the low burden of proof placed on petitioners have made it attractive to file SIRVA petitions, even when such claims are dubious.  Petitioners in such cases often prevail because of the low burden of proof and because it is not necessary to prove causation.

Id.  HHS claims that “excessive awards . . . in SIRVA cases threaten the integrity of the [compensation program].”  Id.

But if the Vaccine Act’s statutory compensation program doesn’t pay, who will?  Maybe nobody.  HHS also seems to anticipate that returning SIRVA and vasovagal syncope cases to the tort system would increase transaction costs and thereby make it too expensive for moderately injured people to seek any compensation from anyone.  HHS undertook a study and determined that SIRVA claims have a “median award” of $22,530 in the tort system.  Id.  HHS also “conducted a search in the WestLaw legal database for cases in state court that contained both the terms ‘SIRVA’ and ‘vaccine,’ and found only 20 hits.”  Id. at 43804.  So the preferred course seems to be that nobody recover anything from anyone.

While that might be OK, from our DTP (and thimerosal) experience, we don’t like to see anyone – including health care providers (who are the customers of our clients) – deliberately being left open to suit over injuries allegedly inflicted on people getting vaccinated.  That only encourages lawyers on the other side of the “v.” to attack everyone involved in the vaccination process.  If health care providers are sued, some number of them will inevitably file third-party actions against vaccine manufacturers as alternative causes (which the HHS proposal doesn’t consider at all), leading to what could well be unpreempted civil litigation over vaccines.  See 85 Fed. Reg. at 437,97 (relying on cases holding that “negligent administration” of vaccines is not preempted by the Vaccine Act).

Thus, we think it is preferable that these claims remain under the auspices of the Vaccine Act, as we think the plain language of the statute demonstrates that Congress so intended.  If there are proof problems specific to claims arising from “vaccine administration” as opposed to inherent characteristics of a vaccine, a targeted approach directed at ensuring that alternative causes are ruled out could be undertaken consistently with the statute’s requirements.

The availability of compensation is one less disincentive to vaccination, and with so many hopes currently resting on the rapid development and roll-out of a safe and effective COVID-19 vaccine, we need to be removing disincentives to vaccination, not increasing them.

*          *          *          *

Finally, after we’d put together the above post, we learned of yet another vaccine-related development.  On August 20, 2020 HHS published a notice in the federal register, extending PREP Act immunity to certain pharmacy personnel (“certain State-licensed pharmacists to order and administer, and pharmacy interns”) who administer childhood vaccines by changing the definition of “covered persons.”  This expansion of immunity encompasses all childhood vaccines – including those already covered by the Vaccine Act − not just any as-yet unreleased vaccines against COVID-19.  As to Vaccine Act compensation, this declaration states:

Nothing in this Declaration shall be construed to affect the National Vaccine Injury Compensation Program, including an injured party’s ability to obtain compensation under that program.  Covered countermeasures that are subject to the National Vaccine Injury Compensation Program . . . are covered under this Declaration for the purposes of liability immunity and injury compensation only to the extent that injury compensation is not provided under that Program.  All other terms and conditions of the Declaration apply to such covered countermeasures.

Third Amendment to Declaration Under the Public Readiness and Emergency Preparedness Act for Medical Countermeasures Against COVID-19, at 12th page (unnumbered) (emphasis added).

Given the sweeping scope of PREP Act immunity (see our prior post), the combined effect of these two actions appears to create a bizarre disparity – if childhood vaccines are administered by less trained pharmacists and pharmacy interns, those persons are immune from all injury claims (subject only to the PREP Act’s largely undefined immunity program under 42 U.S.C. §247d-6e(a)).  But if the same vaccines are administered by other health care providers, those providers remain subject to negligence liability under the Vaccine Act for SIRVA and vasovagal syncope, as described above.  To us this disparity, disadvantaging doctors and nurses (covered only by the Vaccine Act) as compared to pharmacists (covered only by the PREP Act), makes no sense.  We question whether HHS’ right hand knows what HHS’ left hand is doing.

This latest development also raises a broader question as to which we admit we do not know the answer:  As to any eventual COVID-19 vaccine, will compensation for (almost certainly inevitable) vaccine-related injuries be governed by the Vaccine Act’s compensation system – which 85 Fed. Reg. 43,791 treats as primarily concerned with “childhood” vaccines – or will such compensation be provided under the heretofore largely undefined standards of the PREP Act’s compensation system?

Defendant manufacturers of FDA-approved Class III medical devices generally do pretty well with preemption motions, as our PMA Preemption Score Card (now with well over 500 decisions) demonstrates.  Conley v. St. Jude Medical, LLC, ___ F. Supp.3d ___, 2020 WL 5087889 (M.D. Pa. Aug. 28, 2020), is one of these, but some aspects of Conley make it more interesting than most PMA preemption decisions – presumably why West chose it for publication in F. Supp.

The principal plaintiff in Conley was an amputee implanted with a pain-fighting stimulator.  He had lost the limb to cancer, and thus needed frequent MRIs to look for possible recurrence.  The device was designed with an “MRI mode” to accommodate that situation.  However, that MRI mode allegedly malfunctioned, and he had the device explanted.  Id. at *1.  In an attempt to avoid preemption, plaintiffs also tried to involve the defendant’s representative, alleging that the rep “regularly tested” the device, and when the problem arose, “informed . . . that the stimulator ‘was not reading properly’ when it was last tested.”  Id.

Only one of plaintiffs’ attempts to avoid preemption was successful, and even that claim failed as a matter of Pennsylvania law.

Plaintiffs’ negligence claim “related to the conduct of Defendant’s employee” failed because, “to state a valid parallel claim for negligence, the ‘duty’ element must arise from federal requirements applicable to a medical device.”  Id. at *5 (citation and quotation marks omitted).  As to the manufacturer’s representative, “Plaintiffs here have failed to identify any duty arising from the federal requirements applicable to the [device].”  Id.

Aside from the sales representative, the only claimed negligence duty concerned purported violations of FDA GMPs (also called “CGMPs”).  Significantly, since the Third Circuit has not decided the issue, Conley came down on the “specific” side of the split over how GMP violations must be pleaded.  “[I]nsofar as Plaintiffs attempt to use the GMPs as the basis for a parallel claim, courts have regularly found that general citations to the GMPs or federal regulations are not specific enough to sustain a parallel claim.”  Id. (citations and footnote omitted).  Conley cites a useful selection of favorable Third Circuit district court opinions on this issue, and distinguishes the major adverse decision.  Id.

The same reasoning applied to plaintiffs’ strict liability claim for manufacturing defect.  Vague claims of “recalls” and that the device was “adulterated could not avoid preemption:

Once again, the Court notes that Plaintiffs have failed to allege any specific violations of federal law that might establish a parallel state duty.  The amended complaint neither identifies a specific manufacturing defect, nor specifically alleges how Defendant’s practices ran afoul of FDA requirements.  Insofar as Plaintiffs argue this claim can survive preemption due to their reliance on the GMPs, once again, the Court notes that the GMPs are too vague to satisfy the requirements of a parallel claim.

2020 WL 5087889, at *7 (citations omitted).

Plaintiffs’ warning claim in Conley was also preempted.  Since “Pennsylvania’s duty to warn for medical devices runs to the physician,” there was no analogous state-law duty to report adverse events to the FDA.  2020 WL 5087889, at *6 & n.6.  Thus, the plaintiffs’ failure-to-report claim predicated on such a non-existent duty was both expressly and impliedly preempted.  Id. at *7 & n.7.  Nor did plaintiffs in Conley plead that “actual” unreported incidents or how any failure to report caused the alleged injuries.  Id. at *7.

Only express warranty escaped preemption, based on what we consider to be the archaic and simplistic rationale that such claims “do[] not involve a state requirement.”  Id. at *6.  This reasoning dates to the pre-Riegel decision, Michael v. Shiley, Inc., 46 F.3d 1316 (3d Cir. 1995), and most other courts, including several in the Third Circuit, hold at least some express warranty claims – those arising from FDA-approved language – to be preempted.  See Hart v. Medtronic, Inc., 2017 WL 5951698, at *6 & n.6 (D.N.J. Nov. 30, 2017) (only express warranty claims “beyond those appearing in the FDA-approved instructions and warnings” escape preemption); Clements v. Sanofi-Aventis, U.S., Inc., 111 F. Supp.3d 586, 602 (D.N.J. 2015) (“an express warranty claim is not necessarily preempted under the MDA”; no preemption “if the plaintiff can show that the defendant-manufacturer made voluntary statements that were not approved by the FDA or mandated by the FDA”) (citation and quotation marks omitted); Becker v. Smith & Nephew, Inc., 2015 WL 4647982, at *4 (D.N.J. Aug. 5, 2015) (“If a claim is based on the information contained in FDA approved product labels and packaging inserts, it is barred.”) (citation and quotation marks omitted); Morton v. Allegran, Inc., 2015 WL 12839493, at *4 (D.N.J. April 2, 2015) (plaintiff “does not factually allege that [defendant] made any voluntary statement . . . that was not approved by the FDA”; express warranty “is therefore preempted”); see also Bexis’ book, at §5.01[3][c][iv], at n.226.

Nonetheless, the express warranty claim in Conley was dismissed because plaintiffs’ claim failed to plead reliance, as required by the statute’s “basis of the bargain” element:

[Plaintiffs] appear to acknowledge that they were unaware that any warranty may have existed at all until after [the] explant surgery, a year after the device was originally implanted.

2020 WL 5087889, at *6.  An unknown “warranty” simply cannot be part of the “basis of the bargain” on which a product was sold.

Leave to amend was also denied.  Id. at *8.  Conley applied (as it should have) the rule from Albrecht that “[p]reemption is a matter of law.”  2020 WL 5087889, at *8 (citing Merck Sharp & Dohme Corp. v. Albrecht, 139 S. Ct. 1668, 1680 (U.S. 2019)).  Conley is the first medical device decision in the Third Circuit explicitly applying Albrecht to medical device preemption, but it surely won’t be the last.  Plaintiffs’ request for discovery on this legal question amounted to a “fishing expedition”:

In medical device cases, courts have regularly rejected the argument that plaintiffs are entitled to discovery prior to dismissal on preemption grounds.  As the Court is disinclined to allow Plaintiffs to undertake a discovery fishing expedition . . ., the Court finds that allowing further amendment in this case would be futile.

Id. at *8 (citation omitted).

In what’s a bit of a mixed bag decision, the ultimate takeaway from Bird v. Globus Medical, Inc., 2020 WL 5366300 (E.D. Calif. Sep. 8, 2020) is that the complaint was generally lacking.  So, plaintiff is going to get a second chance.  Meanwhile, we can take a look at just what wasn’t up to par on the first go-round.

Plaintiff underwent surgery on her cervical spine (neck) during which her surgeon implanted a device allegedly manufactured by defendant.  The device received 510k clearance from the FDA.  Approximately seven years after the surgery, plaintiff learned that the device had moved out of position, “causing danger of paralysis and death.”  Id. at *1.  Plaintiff sued the manufacturer for fraud by concealment, negligence per se, and failure to warn.  Before getting to the merits of defendant’s motion to dismiss, the court agreed to take judicial notice of documents pulled directly from the FDA’s public website.  Id.  The court was unwilling to take judicial notice, at plaintiff’s request, of a device brochure because plaintiff failed to provide adequate information about the document’s origins.  Id. at *2.

Defendant’s first ground for dismissal was that plaintiff failed to allege any present injury.  As of the filing of the complaint, plaintiff was only alleging a risk of serious injury, but nothing had happened yet.  Based on this fear of future injury, plaintiff alleged she suffered “physical and mental pain and suffering” and had incurred medical bills and related expenses.  Id. at *3.  As to the part of plaintiff’s claim for emotional distress, that claim requires “more likely than not” proof that the feared injury will occur and that is corroborated by expert evidence.  Id.    Plaintiff did not adequately plead her emotional distress claim and it was dismissed.

Defendant argued that the economic loss rule barred plaintiff’s economic damages claim due to a lack of present injury.  The economic loss rule prohibits a tort recovery for purely economic damages unless those damages are accompanied by “some form of physical harm.”  Id.  Relying on state court precedent, the court ruled that where plaintiff’s fraud claim was based on “misrepresentations that risked physical harm to persons,” the economic loss did not apply.  Id.  The same, however, is not true for plaintiff’s negligence-based claims.  To avoid the economic loss rule for those claims, plaintiff has to plead, absent a common law exception, either a personal injury, physical damage to property, or a special relationship between the parties.   Since she pleaded none of those, the court dismissed her negligence per se and failure to warn claims without prejudice.  Id.

Defendant also argued that plaintiff’s claims should be dismissed as preempted because they exist solely by virtue of the FDCA.  Id. at *4.  From the opinion it appears plaintiff is making off-label promotion allegations.  While not explicitly set forth in the decision, it appears plaintiff’s claims are focused on the fact that the device was cleared for use in the spine somewhere other then in the cervical region.  So, plaintiff’s fraud claims are premised on the alleged non-disclosure of the scope of the 510k clearance and her negligence claims are based on allegedly illegal off-label promotion.  Id.

Here, the court looked to Ninth Circuit precedent.  First there is Perez v. Nidek, 711 F.3d 1109, 119-20 (9th Cir. 2013) which held that fraud claims based on the “non-disclosure to patients of facts tied to the scope of [FDA] approval,” are preempted as private attempts to enforce the FDCA.  We cover that topic here.  Then came McClellan v. I-Flow Corp., 776 F.3d 1035, 1040 (9th Cir. 2015), which we covered here.   There, plaintiff alleged that defendant failed to warn that the device should not be put to an off-label use.  The Ninth Circuit said the claim was not preempted because the allegations were “outside the context of the regulatory process.”  Id. at 1041.  We bet you can figure out which decision we think got it right.

In any event, the Bird court decided plaintiff’s failure to warn claim was more like McClellan and her fraud claim more like Perez, but then decided neither was preempted.  Plaintiff’s failure to warn that the device was not safe for use in the cervical spine could exist outside the regulatory context.  Bird at *5.  And plaintiff’s fraud claim wasn’t only about the scope of approval.  Plaintiff also alleged that defendant “created the false impression” that the device “was properly cleared for use by the FDA.”  So, plaintiff isn’t only alleging that defendant’s promotion was off-label but also that it was false which is a basis for liability under California law.  Id.

On negligence per se, the court held the claim survived preemption because it was premised on a violation of a state duty under the California Health and Safety Code that paralleled the duties imposed by federal law.  Id.

Having survived preemption, the court ultimately held that plaintiff’s fraud claim was inadequately pleaded under the heightened standard of Rule 9

While perhaps sufficient to suggest “how” defendant may have committed fraud by concealment and “what” was concealed, the complaint does not provide defendant with notice of “who…when, [and] where.

Id. at *6.  So, the claim was dismissed without prejudice. Finally, the learned intermediary rule precludes any failure to warn claim premised on a duty to warn the patient directly.  Id.

If you tally things up – plaintiff’s emotional distress claim was dismissed.  As to economic damages, only her fraud claim survived.  Then that claim was dismissed for insufficient pleading.  On the whole, there is really nothing left – except plaintiff’s second chance.  We’ll have to wait to see what she makes of it.

Not long ago we brought you a report from the False Claims Act (“FCA”) front on how the government was doing with its attempts to prune back some of the worst abuses of FCA litigation – particularly the advent of “professional relators.”  In that earlier post, we discussed the two major approaches that courts had taken towards the authority of the United States to put an end to objectionable litigation ostensibly brought in its name – the more deferential analysis of Swift v. United States, 318 F.3d 250, 252 (D.C. Cir. 2003), versus the less governmentally friendly stance taken in United States ex rel. Sequoia Orange Co. v. Baird-Neece Packing Corp., 151 F.3d 1139, 1145 (9th Cir. 1998).  We also detailed how – as of April 13, 2020 – “In 22 of 24 post-Granston[-memo] cases, motions to dismiss filed by the government have been granted.”

This is an update about United States ex rel. CIMZNHCA, LLC v. UCB, Inc., 2019 WL 1598109 (S.D. Ill. April 15, 2019), which was one of the two government losses.

It’s a loss no longer.

In United States v. UCB, Inc., ___ F.3d ___, 2020 WL 4743033 (7th Cir. Aug. 17, 2020) (“US v. UCB”), the Seventh Circuit unanimously (but with a concurrence) reversed the trial court’s refusal to allow the government to dismiss the action.  In so doing, the Seventh Circuit appears to have invented its own “third way” test for evaluating government dismissal motions – albeit one closer to Swift than to Sequoia Orange.  “[T]he correct answer lies much nearer to Swift than Sequoia Orange.”  2020 WL 4743033, at *2.

Full disclosure:  Reed Smith filed an amicus brief in US v. UCB, for the U.S. Chamber of Commerce.

We will skip most of this rather lengthy (16 Westlaw pages, with an appendix) opinion because it is directed to the question of appealability rather than the government’s substantive right to dismiss a rogue FCA relator’s claims.  Suffice it to say that, while the government appealed claiming a “collateral order,” the court decided, instead to deem the government’s dismissal motion to encompass a motion to intervene, the denial of which was appealable as of right.  See generally 2020 WL 4743033, at *4-7.  There follows a lengthy discussion of the “constitutional doubt canon,” which the court ultimately decides not to employ (and the concurrence wouldn’t have even mentioned).  Id. at *7-10, 16.  Only then does the opinion reach the merits.

On the merits, “the government was entitled to dismissal.”  Id. at *10.  The action itself was contrived from beginning to end.  The “plaintiff” was a shell – an investment vehicle for litigation funders to create their own litigation:

For a limited liability company called Venari Partners, doing business as the “National Health Care Analysis Group,” this law [the FCA] presented a business opportunity.  Venari Partners has four members (Sweetbriar Capital, LLC; 101 Partners, LLC; Min-Fam-Holding, LLC; and Uptown Investors, LP), themselves composed of one or two individual investors, six in total.  Venari Partners formed eleven daughter companies, each for the single purpose of prosecuting a separate qui tam action.  All eleven actions allege essentially identical violations of the False Claims Act via the Anti-Kickback Statute by dozens of defendants in the pharmaceutical and related industries across the country.  The relator in this case is CIMZNHCA, LLC, one of those Venari companies.

US v. UCB, 2020 WL 4743033, at *1-2 (emphasis added).

The court analogized the government’s power to dismiss an FCA action under 31 U.S.C. §3730(c)(2)(A), to a plaintiff’s right to dismiss an action voluntarily under Fed. R. Civ. P. 41(a)(1)(A)(i).  This Rule 41 right to dismiss “is absolute.  One doesn’t need a good reason, or even a sane or any reason to serve notice under the Rule.”  2020 WL 4743033, at *10 (citations and quotation marks omitted).  The FCA adds only a relator’s right to “notice and opportunity to be heard” to Rule 41.  Id.

Once, as was provided in the district court, “the relator received notice and took its opportunity to be heard . . ., that should have been the end of the case.”  Id.  The only constraints that US v. UCB put on the government’s right to dismissal had nothing to do with the manufactured facts of that manufactured FCA action.  These were the “background constraints on executive action” such as “a colorable claim that the agency’s refusal to institute proceedings violated any constitutional rights of the plaintiffs.”  Id. at *11.  A dismissal that “proceed[ed] from enmity or prejudice” or was “in return for a bribe” could be rejected by a court under  §3730(c)(2)(A).  Id. (citations and quotation marks omitted).  “[W]e hope that these generous limits would be breached rarely if ever.  We say only that in exceptional cases they could supply grist for the hearing.”  Id. at *12.

Short of that extreme, the government had a right to prevent FCA relators from pursuing meritless – indeed, destructive – legal actions.

Wherever the limits of the government’s power lie, this case is not close to them.  At bottom, the district court faulted the government for having failed to make a[n] . . . estimate of the potential costs and benefits of [this] lawsuit, as opposed to the more general review of the Venari companies’ activities undertaken and described by the government.  No constitutional or statutory directive imposes such a requirement.  None is found in the False Claims Act. The government is not required to justify its litigation decisions in this way.

US v. UCB, 2020 WL 4743033, at *12.  The government had good reasons for putting an end to these investor-owned FCA claims.

The government proposed to terminate this suit in part because, across nine cited agency guidances, advisory opinions, and final rulemakings, it has consistently held that the conduct complained of is probably lawful.  Not only lawful, but beneficial to patients and the public.

Id.  FCA claims “should not” be “created as investment vehicles for financial speculators” or —“permitted to indiscriminately advance claims on behalf of the government . . . that would undermine  practices the federal government has determined are  appropriate and beneficial.”  Id. (citation and quotation marks omitted).

In short, the government’s dismissal of these ill-conceived and pecuniary claims was “not government irrationality.  It oppresse[d] no one and shocks no one’s conscience.”  Id.  Accordingly, US v. UCB rejected “Sequoia Orange’s ‘two-step test.’”  Id. at *13.  The government does not bear any initial burden of proof.  Nor was there any need to remand.  “[T[he proper outcome is clear,” and “[a] denial would be an abuse of discretion.”  Id.

*          *          *          *

FYI:  To tie up the other loose end from our original report, US v. UCB also informed us (2020 WL 4743033, at *4 n.2) that the other government loss was recently deemed non-appealable by the Ninth Circuit.  See United States ex rel. Thrower v. Academy Mortgage Corp.968 F.3d 996 (9th Cir. 2020).  That result leads to the legal absurdity of a supposed “relator” suing in the government’s name over something that the government itself is on record that it doesn’t want litigated.

That’s how Maryland’s highest court chose to characterize its gradual move from Frye to Daubert – a drifting process.  Like the way the ocean drifts ashore as the tide is rising.  Creeping a little higher, each wave covering and absorbing a little more of the beach.  As it slowly inches toward your chair where you’re trying to finish the latest Erin Hildebrand summer must read.  Maybe it picks up a few new shells along the way, but it takes its sweet time reaching its crest.  Or, maybe we’re just lamenting the end of summer.  Either way, we are happy to report that Maryland’s slow drift finally ended – it adopted Daubert.

In Rockhind v. Stevenson, 2020 WL 5085877 (Md. Ct. App.), Maryland’s highest court, in a 4-3 decision, acknowledged that it was now joining the “supermajority” of states to adopt the federal Daubert standard.  Id. at *2.  So, where does that leave us in the tally?  By our count, 42 states (including the District of Columbia) have adopted Daubert.  Five states come close:  Sargon Enterprises, Inc. v. University of Southern California, 55 Cal. 4th 747 (2012) (declined to explicitly adopt Daubert, but recognized the role of judges as gatekeepers and their ability to step outside the Frye standard); In re Accutane Litig., 191 A.3d 560 (N.J. 2018) (stopped short of adopting Daubert, but did adopt key factors recognized in Daubert); Higgs v. State, 222 P.3d 648, (Nev. 2010) (Daubert’s flexible approach is persuasive); State v. Hernandez, 707 N.W. 2d 449 (N.D. 2005) (Daubert not explicitly adopted, expert admissibility governed by North Dakota Rule of Evidence 702 which is similar to the federal rule); Va. Code Ann. 8.01-401 (admissibility of expert testimony subject to basic requirements, including requirement that evidence be based on adequate foundation).

That leaves only 4 remaining Frye “general acceptance” states – Illinois, New York, Pennsylvania, and Washington.  Four states holding on to a standard for the admissibility of expert testimony that is nearly a century old.  A standard that was announced five years before the invention of the now virtually obsolete iron lung; 13 years before the development of the first hand-cranked pacemaker.  Decades before anyone ever dreamed of things like a cochlear prosthesis, an insulin pump, an artificial heart, a bionic limb.  It’s unlikely that anyone in 1923 could have foreseen the explosion in the development of pharmaceuticals.  At that time insulin was brand new and penicillin was still 5 years down the road.  Heck, Daubert is already 27 years old.  And while the flying cars predicted by Hanna-Barbera (The Jetsons) and Robert Zemeckis (Back to the Future) aren’t reality yet, drones and self-driving cars (sort of) are.  So why cling to an outdated standard?

That was the question posed to the Maryland Court of Appeals in RockhindRockhind is not a drug or device case.  Plaintiff sued her former landlord alleging that her exposure to lead paint as an infant led to the development of learning disabilities, ADHD, and other psychological disorders.  Rockhind, 2020 WL 5085877 at *2.  For various reasons, mostly related to the testimony of plaintiff’s causation expert, the case went to trial four times.  Before each trial, defendant moved to exclude plaintiff’s expert and asked for a Frye hearing.  The hearing requests all were denied.  In between trial two and three, the Court of Appeals ruled that plaintiff’s expert “did not provide a sufficient factual foundation for . . . her conclusion that lead exposure can cause ADHD.”  Id. at *3.  The trial court, interpreting the appellate decision narrowly, allowed plaintiff’s expert to testify that the lead exposure caused plaintiff’s “attentional deficits, hyperactivity, and impulsivity problems” – all elements of ADHD – as long as she never uttered “ADHD” directly.  Id. at *4.  A jury verdict for plaintiff led to this appeal which raised questions regarding whether the trial court erred in allowing certain expert testimony, including specific causation opinions based on general epidemiological studies.  But the court first had to decide whether it should adopt Daubert,

The court had a lot of ground to cover.

In the forty years that followed Reed [Maryland’s adoption of Frye], Maryland experienced a jurisprudential drift:  The Frye-Reed standard announced in 1978 slowly morphed into a “Frye-Reed Plus” standard, implicitly and explicitly relying and adopting several Daubert principles.

Id. at *2.  Because of this slow drift, picking up pieces of Daubert like shells on a beach, the court acknowledge that the Frye-Reed standard had “a confusing grip on Maryland bench and bar.”  Id. at *5.  So, the question of whether to take the final step was certainly ripe for consideration.   The first drift was when Maryland started using Frye to assess scientific conclusions, instead of only scientific methods.  Id. at *7.  If an expert was following “generally accepted medical principles” to reach a novel conclusion, that opinion required a Frye hearing.  Id.  This was an acknowledgment of the need to mind the “analytical gap” addressed by the Supreme Court in General Electric Co. v. Joiner, 522 U.S. 136, 146 (1997).  Another step toward Daubert.  The second drift came when Maryland started applying Frye to any scientific principle – new or old.  Rockhind at *8.  In other words, the judge’s gatekeeping function includes keeping out “old junk science” too.  Id.   Thus, leading the court to conclude that “[t]he evolution of [Maryland’s] Frye-Reed doctrine to both maintain the general acceptance test and include a check for an analytical gap has muddied our approach to expert testimony.”  Id. at *10.

The court decided it was time to stop drifting and un-muddy the waters:

The impetus behind our decision to adopt Daubert is our desire to refine the analytical focus when a court is faced with admitting or excluding expert testimony. This becomes especially important in modern society, which routinely confronts emerging technologies that challenge the efficacy of Frye. Frye centered on whether scientific principles or discoveries were generally accepted in a relevant scientific community. Yet, using acceptance as the only measure of reliability presents a conundrum: a generally accepted methodology may produce “bad science” and be admitted, while a methodology not yet accepted may be excluded, even if it produces “good science.”

Id. at *14 (citing Motorola Inc. v. Murray, 147 A.3d 751, 756 (D.C. 2016) (covered here on the blog).  Because the trial court did not have the court’s reasoning when it considered the admissibility of plaintiff’s expert’s testimony, the case was remanded to address the issue using the Daubert standard, with some offered words of guidance on how it should do that.  Those words seemed to include an invitation to trial courts generally to revisit the admissibility of expert evidence that previously had passed the Frye test.  “The shift to Daubert may mean, in a very real sense, that ‘everything old is new again’ with respect to some scientific and technical evidentiary matters long considered settled.”  Id. at *18.

Maryland considered itself delayed in finally adopting Daubert and with only four states clinging to the outdated, and simultaneously unduly restrictive and unduly permissive general acceptance standard – it’s time to call Frye what it is, an iron lung.  It had its day, but science has evolved and so too must the law.  Advances in technology and medicine are not slowing down.  And while the law shouldn’t get out in front of medicine, it has to at least have the ability to keep pace.

The order of operations can matter.  Back in elementary school, you may have learned a mnemonic about somebody’s aunt to help you remember the right order for doing certain math problems.  In computer programming, engineering, auto repair, surgery, and a myriad of other endeavors, you can get very different results if you take the same steps in a different order.  Some ordering may be obvious—anesthesia before incision in surgery—but the importance of proceeding in a specific sequence may only become apparent with the benefit of experience.  When it comes to pleadings and preemption, we have been beating the order of operations drum since some of our first posts, noting the pandemonium that can result when a court analyzes issues out of order.  (We have decried a similar dynamic with novel claims.)

The allegations and issues in Evans v. Gilead Sciences, Inc., No. 20-cv-00123-DKW-KJM, 2020 WL 5189995 (D. Haw. Aug. 31, 2020), are very similar to those in a decision we lauded last month for its directness and brevity.  The order of analysis, however, was different, resulting in a longer, less than a full win, and a chance for a third strike for the plaintiff.  It is worth noting that the Evans plaintiff was pro se and proceeding in forma pauperis.  Aside from the Latin lingo, this means that the court had already dismissed plaintiff’s first complaint and the motion to dismiss was on his second attempt.  It also meant, although there is no legal requirement for this, that the plaintiff was cut some extra slack.  We suppose that a represented party, had it done like the plaintiff here—filed a complaint that “lacks focus” with claims that are “difficult to deconstruct” and responded to a motion to dismiss with a cut-and-paste from “an antitrust class action complaint . . . which is irrelevant to Evans’ product liability claims and the arguments Gilead raises for dismissal”—would have gotten the boot without much analysis.  Instead, the court undertook a fairly detailed, if out of order, analysis.

The basic facts are that plaintiff claimed joint pain from his use of the prescription medication Truvada for either Pre-Exposure Prophylaxis or treatment of HIV.  He was prescribed the drug in August 2018, more than a decade after Truvada was approved and a mere three months after FDA had approved an update to labeling.  The physician and patient labeling had extensive disclosures about bone mineral density and kidney risks, recommending monitoring for certain patients.  Plaintiff made a design claim based on the idea that one of the active ingredients in Truvada should have been a different compound that Gilead also had approved (swapping in TAF for TDF in the lingo of the case), a warnings claim based on a mishmash of allegations, and boilerplate allegations about fraud and warranty.  Gilead moved to dismiss on the adequacy of pleadings and preemption.

After recounting the basics on these issues and Hawaii product liability law—of which our only confusion was the court’s reference to the “trilogy of preemption cases the Supreme Court has decided involving drug manufacturers” when it discussed Albrecht along with Levine, Mensing, and Bartlett—the court launched into its preemption analysis first.  As the court later pointed out, preemption is an affirmative defense and a constitutional one at that.  The pleadings challenge should have been considered first.  Ultimately, the claims for fraud—which requires heightened pleading—express warranty, and implied warranty (without specifying whether the merchantability or fitness variant was being pursued) were easy to dismiss, even though plaintiff was offered a third chance to plead them.  Warnings was a little more complicated, although it met the same fate.  Hawaii follows the learned intermediary doctrine, so plaintiff had to allege facts supporting that his prescribing physician would have changed his behavior and avoided plaintiff’s alleged injury had he been provided with additional or different warnings.  Plaintiff did not, so he failed to plead proximate cause and his warnings claim was dismissed, again with a third chance afforded to fix it.

To get there, however, the court walked through the allegations about inadequate warnings, which included alleged inadequacies in the patient warnings—which should have been irrelevant because of the learned intermediary doctrine—and the physician labeling, both as to bone risks and kidney risks—which should have been irrelevant because plaintiff did not allege a kidney injury.  Ultimately, the court, relying largely on California law, strung together an argument about inadequacies in the extensive physician labeling particularly as to the phrasing of the disclosure of joint pain and the bone density monitoring recommendation and concluded that “a reasonable jury could conclude that these warnings were inadequate.”  Setting aside whether we think that was correct, it clearly went nowhere given the lack of allegation of proximate cause.  And, perhaps more importantly, this analysis of the adequacy of the warnings allegations was not used to focus the analysis of whether a warnings claim—if a proper one were alleged—would have been preempted.  The court had already decided, in a rather abstract consideration of the issues, that it was not.

That is our main problem with the decision.  Recall that the prescription here—the one plaintiff did not allege would have changed with different warnings—was made three months after FDA approved the labeling that plaintiff was challenging.  In this context, given Levine and Albrecht, the inquiry should have been whether there was an allegation of new information that could have triggered the need for a CBE submission about the allegedly inadequate warnings—that is, the phrasing of the disclosure of joint pain and the bone density monitoring recommendations—during that narrow window.  Given that many of the cases the court cited acknowledged the narrow application of CBEs—something Levine butchered—the absence of such a specific allegation in the complaint should have been the end of it, assuming the court had decided to address preemption at all given warnings had not been pleaded adequately.

Instead, the court offered two justifications for finding no preemption on this record.  First, the court said plaintiff did not have to plead facts suggesting that a CBE submission could have been used because, as we noted before, preemption is an affirmative defense so plaintiff did not have plead around it.  Except that the CBE is a narrow exception to the general rule that a drug with an approved label, like this one had, must be marketed with the approved label.  To do otherwise is to violate FDA requirements.  So, without pleading something suggesting a CBE could have been used post-approval of the label being challenged, the plaintiff’s allegations did “admit[] all the ingredients of an impenetrable defense.”  Second, the court required Gilead to have proved by “clear evidence” that the FDA would not have approved a change to the drug’s warnings.  Given that plaintiff had not articulated a grounds for changing the label at all or what it should have said different, this was not the right inquiry.  We also submit that detailed labeling approved three months earlier with no allegation of new evidence of risk since is pretty clear evidence of the futility of trying to change the label for no reason.

Before the warnings analyses, the court addressed whether the design defect claim was preempted.  It never addressed whether plaintiff satisfied his pleadings requirements or whether Hawaii law would recognize a claim based on the core allegation that a medication should have utilized a different active ingredient, which it also sold.  (We have been making noise about the latter issue for a long time, too.)  Rather, it went straight to preemption, generously analyzing both the possibility of a pre-approval design claim and a post-approval design claim from the same muddled complaint.  This analysis was thorough and correct.

As for pre-approval, Mensing forecloses the idea that Gilead could have independently brought Truvada to market with TAF instead of TDF as one of its active ingredients.  Getting a different NDA approved cannot be assumed.  The court noted outlier decisions and followed the Supreme Court’s guidance from Bartlett and MensingBartlett (and Yates) rejected that the defendant could be liable for just not selling the drug.  Mensing rejected that the suggestion preemption does not apply where the defendant could have tried to get a different drug on the market.  Citing Utts I (but not Utts II), the court held broadly that “pre-approval design defect claims against brand-name drug manufacturers are preempted by the FDCA.”

Post-approval fared no better.  Bartlett makes it clear that FDA has to approve a labeling change describing a change in the formulation.  So, a CBE is not available and the approval of the label in May 2018 listing the formulation of Truvada meant that a design defect claim based on changing the formulation between May 2018 and August 2018 would be preempted.  Pretty cut and dry, except for the cognitive dissonance over why the analysis of preemption of the warnings claim was so different.  And plaintiff will not get a chance to try to plead around preemption on his purported design claims, an exercise the court labeled “futile.”  When plaintiff does come back with a third try on his other claims, it will be interesting to see if the defendant gets a second chance with preemption.

The Covid-19 lockdown period is approaching the six-month mark, from mid-March to mid-September. Throughout the spring and summer we have been reading old novels with convoluted plots and surprise endings. Today we take a look at an old case, though only from a prior decade, not a prior century. If the case is convoluted, it is largely because the plaintiffs made it so, though the court also got in on the chaos. As for the surprise ending, it is unclear if that results from the court getting things right as much as it did, or from getting things wrong as much as it did.

Kelley v. Insys Therapeutics, Inc., 2019 WL 329600 (Jan. 25, 2019), caught our attention because it discussed preemption of claims involving an opioid. The federal court deciding the matter sat in Cleveland, though it is not the same one handling the massive opioids MDL. In any event, as alluded to above, the Kelley decision gets some things right, some things wrong, and its plot twists are only slightly easier to follow than a tale by Dickens or Thackeray, albeit without much of the entertainment.

There are plural plaintiffs in Kelley because a husband and wife were involved. The husband is the plaintiff we’ll chiefly be referring to, as he brought the primary claims while the wife sued for loss of consortium. The plaintiff was prescribed an opioid to treat his back and knee pain and his carpal tunnel syndrome. That use for general pain was off-label. The medicine is primarily prescribed for treatment of cancer pain. The plaintiff ended up suffering an overdose, acute respiratory failure, liver failure, stroke, withdrawal symptoms, and other serious consequences. He sued the drug manufacturer under a long list of theories, including, inter alia, strict liability, negligence, negligent misrepresentation, fraud, false advertising, and violations of the Ohio Consumer Sales Practices Act (OCSPA). The defendant moved to dismiss the complaint. The court granted parts of the motion to dismiss and denied others.

The FDCA Impliedly Preempted the Off-Label Claims

The Food, Drug and Cosmetic Act (FDCA) impliedly preempts state law claims that are in substance, even if not in form, claims for violating the FDCA. Several of the claims in Kelley amounted to gripes about off label marketing. They were preempted. Things got a little trickier for those claims that rested on state law grounds independent from the off-label issue.

The FDCA Preempted the Negligence Claim

The negligence claim was devoid of any independent ground. The alleged negligence was promotion of the drug for purposes other than “management of breakthrough cancer claim.” Good bye.

The FDCA Preempted the Inadequate Warning Claim

Similarly, the allegedly missing warning was about the increased risks of off-label use. See ya.

The Misrepresentation and Design Defect Claims Escaped Preemption

Here is where the plaintiffs fared better. The Kelley court concluded that the misrepresentation claims “alleged more than off label promotion.” Rather, the plaintiffs alleged that the defendant “willfully deceived” plaintiffs as to the health risks of the product and failed to disclose material facts regarding the product’s safety. That, according to the Kelley court, circumvents preemption. There is no discussion as to whether there was any new evidence that could have supported a change being effected. It is as if Levine and it progeny never existed.

The Kelley court’s analysis of design defect preemption – or lack of analysis – is even more maddening. Again, the key for the court was that the plaintiffs were not confining their claim to off-label problems. Citing a 2013 N. D. Ohio case (Arters) (a thoroughly awful case that we slammed here), the Kelley court held that preemption was not a problem because the plaintiffs more generally alleged that the drug was not safe and should not have been sold at all. It is as if the SCOTUS Bartlett case never existed. For those of us attending to controlling precedent from the Highest Court in the Land, it is pellucid that if a manufacturer cannot do a certain thing – change a warning or, even more fundamentally, alter the design/formula of a drug – without FDA permission, a plaintiff’s claim that the manufacturer should have done that certain thing is preempted. That bit of news seems not to have made it to the shores of Lake Erie.

The Strict Liability Claims Flunked the Ohio Products Liability Act

The plaintiffs’ strict liability claims made a “passing citation to the entire OPLA” at the end of those counts. The Kelley court said that was not good enough. The plaintiffs needed to specify which portions of the OPLA were in play.

So it is okay to ignore clear SCOTUS precedent, but you’d better not ignore the pertinent parts of the OPLA. Good to know.

“Active” Misrepresentation Claims Survived the OPLA

Remember how disappointed we were above when the Kelley court failed to preempt the failure to warn claims? Well, the court kind of got to the right place by concluding that the OPLA abrogated claims of fraudulent omission. So, again, this court seemed way more attuned to the ins and outs of Ohio law than something as flimsy as SCOTUS case law. Even so, the Kelley court waved along the plaintiffs’ claims that the defendant “affirmatively misrepresented” the drug’s safety. That is because OPLA claims are viable when based on “a general duty not to actively deceive.” It is not as if this doctrinal analysis is all buttoned up, is it? Anyway, just as we wondered to ourselves what affirmative misrepresentations were in play (because usually there are none), the Kelley court ruled that the complaint was bereft of any specificity on this score, so the plaintiffs needed to try again.

The OCSPA Failed Because it Was About Personal Injuries

The plot gets really murky here. Like most consumer fraud statutes, the OCSPA is directed at economic injuries. If you are complaining about personal injuries, you’re in the wrong place. File a claim under the OPLA – this time actually following its specific parts – and take your best shot. But the Kelley court held that even though the claims in the case concerned an alleged failure to disclose risks of physical injuries, it simply could not figure out whether the claims were “primarily rooted in product liability claims.” Really? Then the Kelley court said that “the OPLA does not abrogate plaintiffs’ OCSPA claim to the extent it is based on alleged active misrepresentation.” Double huh?

Right as we began to think that Cleveland might just be another name for Crazytown, the Kelley court held that the OCSPA claim IS a personal injury claim and must, therefore, be dismissed. What a head-spinning dialectic! The court acknowledged that the plaintiffs were clearly seeking compensation for physical injuries. Any request for “restitution of the purchase price” of the drug was a flea on the tail trying to wag the dog. Scram to that flea, tail, dog, and bogus consumer fraud claim.

In the end, the Kelley court mostly got to the right place. But it was a long, strange trip. Earlier, we (clumsily) attempted to draw parallels between this case and baggy, 19th Century novels. That was wrong. Kelley is more like a Bach fugue or the stream of consciousness ending of Ulysses. Parts of it are pleasing and parts pass all understanding.

As we write this, it is a glorious Labor Day Monday in the suburbs of Philadelphia.  We are pleased to confirm that the Drug and Device Law Rock Climber retrieved her dogs last week, though not before we rushed to the vet one last time, this time to address the Pom’s allergic skin reaction to something the groomer had used the day before.  We are delighted to be back to our original “pack.”

We are also delighted with today’s decision, in the same remanded inferior vena cava (“IVC”) filter case that produced the excellent comment k decision on which we reported last week.  Today’s decision, Keen v. C.R. Bard, Inc., et al., 2020 WL 4818801 (E.D. Pa. Aug 19, 2020), deals with the admissibility and probative value of evidence that a medical device was “cleared” for marketing through the FDA’s 510(k) process, a question we face every time one of our medical device cases approaches trial.

Let us step back and provide some background for those who do not deal with this issue in their practices.  The FDA uses a three-tier classification system for implanted medical devices.  Devices are “Class I,” “Class II,” or “Class III,” depending on the level of risk the agency associates with the device, and the classification determines the process required to bring the device to market.  Class III devices are required to undergo a full premarket approval (“PMA”) process.  Class I and Class II devices may be “cleared” for marketing through the agency’s 510(k) process, which determines whether a device is “substantially equivalent” to a predicate device that was subject to PMA.

In Keen, the plaintiff alleged that he was injured by the defendant’s IVC filter, a Class II device cleared for marketing through the 510(k) process.  He moved in limine to exclude references to the FDA’s clearance of the IVC filter and to the dearth of FDA enforcement actions related to the device.   With respect to the former, the plaintiff argued that the 510(k) clearance process is “irrelevant, because it is a comparative, rather than definitive, finding by the FDA that a device is safe and effective.”  Keen, 2020 WL 4818801 at *2.  Following the lead of an earlier decision by the MDL judge, the Court rejected the plaintiff’s argument, holding that, “even if the standard for [safety and effectiveness] considerations [in a 510(k) review is only comparative, … [a] factfinder, after taking into consideration the history of the FDA’s 510(k) clearance of [the IVC filter], could determine that [the defendant] took reasonable and appropriate steps in its effort to bring [the] filter to market.”  Id.  Of course it could, and of course a defendant should be entitled to inform the jury that its device was “cleared” by the FDA.

The plaintiff also cited Medtronic v. Lohr “for the proposition that the 510(k) process focuses on device equivalence rather than device safety.”  Id. at *3.  Holding that this argument was “meritless,” the Court emphasized that Lohr “inquired into whether FDA’s clearance of a 510(k) device preempted state law product liability claims  . . . .”  not “whether evidence concerning FDA clearance [was] admissible or relevant to the reasonableness of a manufacturer’s conduct.”  Id.   In sum, the Court concluded, “the fact that the 510(k) process focuses on device equivalence does not render evidence of the 510(k) process irrelevant to the reasonableness of [the defendant’s] conduct.   Id. (citation omitted).

The Court also denied the plaintiff’s request to exclude references to the lack of FDA enforcement actions related to the line of filters that included the plaintiff’s filter.  The Court held, “The fact that the FDA did not bring an enforcement action . . . during the nearly five years that the [line of filters] was on the market before the [filter] was implanted in the [the plaintiff] could be relevant to whether it was reasonable for [the defendant] to design and manufacture the [filter] and to continue marketing it . . . .”  Id.  The Court concluded, “[The defendant may . . . be prejudiced if it is not permitted an opportunity to present to the jury a full picture concerning its decisions to market [the filter initially] and to continue marketing it . . . .”

Keen will be a boon to anyone facing a plaintiff’s (illogical) argument that evidence of 510(k) clearance is not relevant to the care a manufacturer exercised in developing and marketing a Class II medical device.   We again applaud Judge Gene Pratter, whose stewardship of this case is spawning a body of singularly well-reasoned decisions on issues faced over and over again by lawyers representing medical device manufacturers.  We will keep you posted on any new decisions.   In the meantime, stay safe out there.


What follows is another “guest post” by our blogger-in-training Dean Balaes.  This one concerns remote corporate Rule 30(b)(6) depositions and a recent decision addressing them.


In many respects, COVID-19 has created (to use the overused term) a new normal for the legal profession.  When California became the first state to issue a stay-at-home order in its attempt to prevent the spread of COVID-19, courts were faced with a choice:  delay court proceedings and further delay the already-backlogged legal system, or embrace technology and move proceedings online.  Since March, the Federal Rule of Civil Procedure 30(b)(6), governing depositions of corporate representatives, has become a hotly contested rule.  As the blog has already discussed, and for a variety of strategic reasons, attorneys question whether courts should still require in-person 30(b)(6) depositions or allow them by videoconference.  Siding with the latter, Rouviere v. DePuy Orthopaedics, Inc., No. 1:18-CV-04814, 2020 WL 3967665 (S.D.N.Y. July 11, 2020), showcases judicial willingness to rethink pre-COVID discovery principles to move discovery along.

The controversy in Rouviere arose when plaintiffs essentially gave the court an ultimatum:  demanding that it “either order the [defendants] to appear for an in-person deposition on the date cleared for deposition or extend the deadline … until the deposition of [the witness(es)] can be conducted in person.”  Rouviere, 2020 WL 3967655, at *2.  The disruptive nature of this request placed the court in an impossible situation, because nobody could say when in-person depositions would be feasible.  The court had to decide whether to imperil the health and safety of the defendants’ personnel and counsel or to “indefinitely delay the completion of discovery[.]”  Id. at *4.

Despite the ongoing global pandemic, plaintiffs’ counsel argued that they would rent a “recreational vehicle” and drive it from Florida (a hot zone) to New Jersey in order to take depositions.  Id. at *2.  Defendants rightly objected to this idea, noting that counsel and witnesses would “place their health at risk by attending an in-person deposition with the Florida plaintiffs” and noted “that all travelers from Florida are subject to [a] 14-day quarantine in New Jersey.”  Id.  Instead of an in-person deposition, defendants recommended that depositions be conducted through videoconference.  Id.

In deciding the issue, the court began its analysis by weighing the prejudice imposed on the defendants if a 30(b)(6) deposition were held in-person against the prejudice to the plaintiffs if depositions were held by videoconference.  Id. at *3.  On the one hand, defendants argued that they could face the ultimate prejudicial prospect of death.  Id.  On the other, plaintiffs argued that they would face prejudice with a videoconference because the deposition will be “document intensive” and “document laden.”  Id.  Agreeing with what seems obvious, the court acknowledged the “significant health risk[s]” to the witnesses and counsel if depositions were held in person, since COVID-19 is “potentially fatal with the ability to spread through asymptomatic or pre-symptomatic carriers, with no approved care, treatment, or vaccine[.]”  Id. (quoting Joffe v. King & Spalding LLP, No. 17-CV-03392, 2020 WL 3453452, at *7 (S.D.N.Y. June 24, 2020)) (footnote omitted).  As for plaintiffs’ concerns, the court emphasized the reality of modern legal practice.  That is, the document-intensive nature of the practice of law “is not an obstacle to a successful remote videoconference,” especially when counsel can watch “training and informational videos” and work with vendors who host videoconference depositions to learn the ins and outs of videoconferencing.  Id.; cf. Model Rules of Pro. Conduct r. 1.1 cmt. 8 (2018) (requiring attorneys to keep abreast of relevant technological changes).

Since each case is unique and has different needs, it is likely that Rouviere’s procedural history might have enhanced the court’s willingness to proceed with videoconference depositions.  Rouviere was already pending for over two years; within this time frame, the court had already granted three extensions of discovery deadlines due to COVID-19.  Id. at *2.  According to the docket, this case was filed in the S.D.N.Y. by a Florida lawyer (on behalf of himself and his wife) who initially appeared as a pro se plaintiff, did not seek pro hoc admission for over a year and who failed to take a voluntary dismissal.  After plaintiffs made a fourth request for an extension, the court granted “one final extension,” outlining new discovery deadlines.  Id.  As a general rule, plaintiffs who think they have strong cases tend to resist multiple extensions.

Pursuant to Fed. R. Civ. P. 30(b)(3) and (b)(4), the court ordered that “all depositions in this action may be taken via telephone, videoconference, or other remote means, and may be recorded by any reliable audio or audiovisual means” (emphasis added).  Since discovery deadlines were already extended due to counsel’s COVID-19 concerns, it seems only practical that the court would permit the use of videoconferencing, especially when the court noted that even if the parties met in person, they would all have to wear face masks.  Id. at *4.  “[I]n the unique circumstances presented by the COVID-19 pandemic, holding a deposition by videoconference actually would provide a better opportunity for Plaintiffs’ counsel to observe the demeanor of the witness.”  Id.

Perhaps if the context surrounding COVID-19 were different, and there was an end in sight to the pandemic, the court would have been more amenable to the plaintiffs’ concerns, or perhaps not, given the number of extensions already granted.  Ultimately, it is hard to predict exigencies, but a few impressions are clear from reading Rouviere:  attorneys should meet discovery deadlines, avoid making excuses for why deadlines cannot be met, and be prepared to live with remote depositions for the foreseeable future.