Medical device sales representatives are often present in the operating room during surgical procedures, especially with procedures involving orthopedic devices.  With those kinds of devices (and others), the hospital typically contacts the sales representative in advance, and he or she is charged with delivering the device in the specified size and providing any specialized instrumentation required for implantation.  The system is logical and effective, but it still comes as a surprise to many lay people that an industry representative is involved at all.  Plaintiffs’ attorneys sometimes emphasize this disconnect to suggest that something untoward is going on, although surgeons and nurses will tell you that a sales consultant’s presence in real time is an integral part of the process.  Many surgeons will tell you that they always expect the consultant to be there.

We were thus surprised to see the tables turned in Parker v. Orthofix Inc., No. 3:17-cv-248, 2019 U.S. Dist. LEXIS 24271 (D. Or. Feb. 14, 2019), where the plaintiff faulted the medical device sales representative for not being present for her surgical procedure.  At first blush, it seems like a damned-if-you-do-damned-if-you-don’t situation, but in the end the district court’s order rejecting the plaintiff’s claim came down to the evidence.  The court granted summary judgment for the manufacturer because the plaintiff could not produce evidence suggesting that the defendant’s representative should have been there (with instruments in tow), let alone that any duty existed or was breached.

Here is what happened.  The plaintiff underwent vertebral fusion surgery using the defendant’s plating system, but her pain persisted.  She therefore went to another surgeon, who determined that a second surgery was required to remove the defendant’s plate and re-perform the procedure using a competitor’s plate.  Id. at *4-*5.

This is where things went off track.  The hospital’s supply office arranged to have the competitor’s replacement plate available (apparently delivered by the competitor’s sales consultant), but after the surgeon started the procedure, he realized that he did not have the specialized tool required to remove the defendant’s plate.  It is not entirely clear why.  The hospital’s clinic supervisor said she never requested the specialized tool because the surgeon did not note in his pre-surgery report that he intended to remove the defendant’s device.  Id. at *6-*7.  The surgeon wrote in his post-operative note (and later testified) that he believed that someone had contacted the defendant beforehand to secure the specialized tool and was told that the surgeon could use instruments from the hospital’s universal tray.  Id. *7.

Whatever occurred before the procedure, the evidence was uniform that the surgeon telephoned the defendant during the surgery and learned that he needed the specialized tool, resulting in the surgeon ending the procedure.  The plaintiff required a third surgery, which also failed to resolve her pain.  Id. at *7-*9.

The plaintiff sued only the medical device manufacturer, and instead of alleging the usual defect allegations against the defendant’s plating system, the plaintiff claimed only that the defendant “negligently misinformed [the hospital] and the surgical team before the unsuccessful surgery about the tool needed to remove the [plate] being contained within a universal tray” and that “this misinformation caused the surgical team to begin operating on Plaintiff without having the correct tool, resulting in the surgical team needing to abandon that surgery.”  Id. at *8-*9.

It turns out, however, that the plaintiff did not have admissible evidence that anyone had ever contacted the defendant before the surgery, which would explain why the defendant’s sale consultant was not there.  The surgeon wrote in his post-operative note that he believed that someone had contacted the defendant, only to be told that the universal tools would do.  But what “someone” was told is obvious hearsay, and there was no other evidence of that purported conversation.  Throughout discovery, no one could even identify the person who placed this call nor the person who received it.  Thus, while the surgeon’s post-operative note met the business-records exception to the hearsay rule, the plaintiff could not account for the second and third levels of hearsay.  Id. at *10-*15.  That is to say, writing down that “someone told me that someone told him or her” is not admissible evidence.  See Fed. R. Evid. 805 (separate exception required for each level of hearsay within hearsay).

The surgeon’s deposition testimony met the same fate:  “I can remember in this case someone telling me that they had talked to Orthofix, and . . . saying that . . . the plate was easy to take out . . . with what I believe is called a universal system.”  (Id. at *16-*17) (emphasis in original).  Again, hearsay within hearsay, as was the testimony of the competitor’s sales representative:  “I had spoken with [the surgeon] and it was his understanding that we would only need the universal system . . . he thought the hospital had contacted the Orthofix rep to get the product there.”  Id. at *20-*21.  This piling on did not help because hearsay problems cannot be cured with still more inadmissible hearsay.

Beyond that, the plaintiff opposed summary judgment with evidence of the contact made with the defendant during surgery.  But that evidence did not raise a dispute of material fact.  The plaintiff’s claim alleged that the defendant misrepresented the tools required to remove the defendant’s plate, which caused the surgical team to start and later abandon the second surgery.  Thus, undisputed evidence that the defendant provided information after the surgery commenced was irrelevant:

Because Plaintiff alleges that Defendant supposedly gave this misinformation to the surgical team before surgery, evidence of a statement made by an employee or agent of Defendant during the unsuccessful surgery would not provide support for Plaintiff’s claim or create a genuine dispute of material fact.  By that time, the surgery had begun and any misstatements made during that surgery cannot be the cause of that surgery having occurred.

Id. at *19-*20 (emphasis in original).  So something fell through the cracks here, and it was no fault of the plaintiff.  It was likewise not the defendant’s fault.  As the district court concluded, “[S]omeone dropped the ball . . . .  Whether that someone was [the surgeon], someone on his surgical team, someone working for [the hospital], someone working for Defendant, or someone else, the Court cannot determine, and on the evidence presented by Plaintiff neither can a jury.”  Id. at *22.  Summary judgment granted.

Roy Cohn would have turned 92 today, had he not died in 1986, a few weeks after being disbarred in New York. Cohn’s legal career was legendary. He was on the team that prosecuted the Rosenberg spy trial. He worked closely with Senator Joseph McCarthy. His clients included mafia figures, the owners of Studio 54, and the owner of the New York Yankees. (It is that last one that makes us most queasy.) Cohn mentored the current POTUS, teaching him always to be nice. Just kidding. Cohn actually told Trump that when someone hits you, hit back even harder. Lesson learned, apparently. Cohn is a character in Angels in America. That is quite a resume. Why are we thinking of Cohn today? Why, indeed.

We personally know two lawyers who managed to get in really hot ethical water. One was disbarred, while the other was fired from his firm. Both ghost-wrote affidavits that were later disavowed by the named affiants. [Practice pointer: do not write false affidavits.] Today’s case, Webb v. Zimmer, Inc., 2019 WL 438361 (EDNY Feb. 4, 2019), involves another sketchy affidavit – a “sham” affidavit in the parlance – and the revelation of the sham led to dismissal of a product liability case. The plaintiff claimed injuries from failure of knee flex-system implant. There were various legal claims, but eventually the only claim left was for failure to warn. Then came the dispositive motions.

First came the Daubert motions. What makes the Webb case so interesting is how the implanting physician (designated as an expert by the plaintiff) signed an affidavit that was fully at odds with what he actually believed. The plaintiff used that affidavit to fend off the defendant’s Daubert motion, but struck out when attempting to use it again, this time to fend off summary judgment. The defendant obtained the right to re-depose the implanter, who promptly contradicted everything in his affidavit. It turns out that the surgeon did not write, or even read, the affidavit, which he admitted contained “inaccuracies, errors, and imprecise language.”

Would you like an example? Of course you would. The implanter offered the following opinion in the affidavit: “I reviewed the Package Inserts and find them to be inadequate because they provide a false sense of security to the treating surgeons.” Well, that’s not good for the defendant, is it? But at his second deposition, the implanter contradicted much of what he stated in this paragraph. He did not review either the package inserts or the surgical technique pamphlet prior to reading or signing the affidavit. He also testified that he was unaware of anything that the defendant “failed to do in terms of researching this product” and was “unaware of the existence of clinical data for any problems related to the Plaintiff.”

Want more contradictions? Here they come. In his affidavit, the implanter proffered the opinions that (1) the failures that occurred with the product were foreseeable; and (2) he should have been warned about it. But the implanter testified in his second deposition that he did not have enough information to testify that the failures that occurred in the plaintiff’s case were foreseeable. Further, the affidavit says that the defendant should have warned or contraindicated the use of the knee system “by advising that it was not tested in patients with hyperextension or high posterior tibial slope.” By contrast (you could see this coming by now, right?), here is what the doctor said at his deposition: “Q. But you don’t know, without evidence or whether there’s a problem with articular surface dissociation, that a warning was appropriate? A. Yeah, that’s true.”

Faced with a collection of contradictions that would have made Emerson or Whitman or Mao blush, the court refused to allow the plaintiff to utilize the implanter’s affidavit “to escape summary judgment only to permit him to modify or contradict himself at trial.” The implanter was also “prohibited from testifying as an expert on these matters.”

The implanter went on to bury the plaintiff on the learned intermediary doctrine. Even aside from the contradictions, the evidence showed that the implanter “chose to use the Product for all his primary implants based on his comfort with the Product rather than any of [the defendant’s] marketing materials or warnings contained in the package inserts.” Moreover, the doctor continued to use the knee implant system long after the plaintiff was forced to undergo multiple revision surgeries and “[t]o this day … remains confident in the product.”
The defendant got out of the case. As far as we can tell, nobody was sanctioned for the sham affidavit, and we find that darned near amazing. Why did the doctor contradict himself so badly? The Drug and Device Law Daughter has shared with us the Reddit theory about people occupying alternate dimensions or timelines. Maybe this doctor traipsed between different timelines. We are just about prepared to believe it.

Earlier this month we explained that a “wrinkle removal,” was one that capitalized on a “wrinkle” in the language of 28 U.S.C. § 1441(b)(2), which provides that a case cannot be removed on the basis of diversity if any “properly joined and served” defendant is a citizen of the forum state.  But if the forum defendant has not yet been served, that “wrinkle” doesn’t apply.  Defendants, in our never-ending quest to get cases into federal court, argue that such pre-service removal is consistent with the plain language of the statute.  Plaintiffs counter that this interpretation leads to an “absurd result” that refutes the plain language rule.  Just last year, the Third Circuit held that in this battle of “plain meaning” versus “absurd result” – plain meaning wins.  Encompass Ins. Co. v. Stone Mansion Rest. Inc., 902 F.3d 147 (3d Cir. 2018).

That was in important decision because since remand is unappealable (28 U.S.C. §1447(d)), appellate review is rare in remand situations.  It also meant that it was a foregone conclusion that Encompass Ins. would be applied in the District of New Jersey cases we discussed a few weeks ago.  When we see it cited and relied upon in the Central District of California, we think that’s important enough to warrant another pre-service removal post this month.

The case is Dechow v. Gilead Sciences, Inc., 2019 WL 517624 (C.D. Cal. Feb. 8, 2019).  Plaintiffs from four different states sued defendant, a resident of California and Delaware, in state court.  Two weeks after the complaint was filed, but before it was served, defendant removed the case to federal court.  Id. at *1.  As the court noted, the issue is “primarily an exercise in statutory interpretation.”  Id. at *2.  And in this instance, the statutory text is “unambiguous. Its plain meaning precludes removal on the basis of in-state citizenship only when the defendant has been properly joined and served.”  Id. at *3.  With no Ninth Circuit decision on point, the court looked to Encompass Ins.

Plaintiffs did try to argue that this literal interpretation of the statute should be rejected because it would lead to absurd results.  For this, they relied on a single case – Vallejo v. Amgen, Inc., 2013 WL 12147584 (C.D. Cal. Aug. 30, 2013).  But Vallejo involved a situation where defendants removed the case before the state court issued the summons to plaintiff.  In other words, removal occurred before it was possible for plaintiff to effectuate service.  Allowing removal in that situation, “would effectively circumvent Congress’s entire statutory scheme and render § 1441(b)(2) superfluous. Such an application could not have been intended by Congress.”  Id. That was not the situation in Dechow where service could have been made but was not.

The district court found additional support in the Ninth Circuit’s interpretation of 28 U.S.C. § 1446(b)(2)(A) which provides that “all defendants who have been properly joined and served must join in or consent to the removal of the action.”  Another removal provision with the same “properly served and joined” language.  To this provision the Ninth Circuit has applied the plain meaning interpretation.  Id. at *4.  What’s good for one, is good for the other.  And plain meaning interpretation is good for the defendants.

Our recent post about the First Amendment decision in American Beverage Ass’n v. City & County of San Francisco, ___ F.3d ___, 2019 WL 387114 (9th Cir. Jan. 31, 2019) (en banc) (“ABevA”), holding unconstitutional a purported product “safety warning” was more than enough to set the old First Amendment juices flowing.  Ninth Circuit en banc decisions involve the largest panels of judges in the country, and ABevA featured no less than four different interpretations of the recent United States Supreme Court decision, Nat’l Institute of Family & Life Advocates v. Becerra, 138 S. Ct. 2361 (2018) (“NIFLA”), so we thought we’d start by examining NIFLA, looking for First Amendment gold.

Briefly, NIFLA addressed the constitutionality under the First Amendment of a statute aimed at certain unlicensed “crisis pregnancy centers” run by anti-abortion activists who were more interested in interfering with their “client”’s best interests than helping them.  138 S. Ct. at 2368. The State of California enacted a statute requiring those clinics to post notices containing information about the availability of competing entities offering real services that also included abortion as an option.  Id. at 2369.  The challenged law also compelled disclosure of these clinics’ unlicensed status.  Id. at 2370.

A five-justice majority in NIFLA held the statute unconstitutional as mandating “compelled speech” – in the form of supposed health-related warnings.  Citing, inter alia, one of our favorite cases, Reed v. Town of Gilbert, 135 S. Ct. 2218 (2015), the majority found “[t]he licensed notice [to be] a content-based regulation of speech.  By compelling individuals to speak a particular message, such notices alter the content of their speech.”  138 S. Ct. at 2371.  The Court then rejected the idea of “professional speech” – that is, persons subject to state licensure − as a new category of less protected speech.  Id. at 2371-72.  “This Court’s precedents do not permit governments to impose content-based restrictions on speech without persuasive evidence of a long (if heretofore unrecognized) tradition,” and the concept of “professional speech” was not “such a tradition.”  Id. at 2372 (citations and quotation marks omitted).  Further, “[t]his Court has been reluctant to mark off new categories of speech for diminished constitutional protection.” Id. (citations and quotation marks omitted).

An exception had been made for compelled speech in attorney advertisements.  Id. (citing Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (1985).  For compelled speech to fall within that exception, however, requires four elements (and here’s where it gets interesting):  (1) “commercial advertising”; (2) a “purely factual” disclosure; (3) “uncontroversial information”; and (4) about the “terms for acquiring” services or (we presume) products.  138 S. Ct. at 2372.  Our usual interest in the First Amendment concerns off-label use, but we have little doubt that an FDA-mandated disclaimer, “this information concerns an off-label use,” would fall within the Zauderer exception.  Our interest here, is as product liability litigators faced with “warning” claims demanding the inclusion of information that is neither “purely factual” nor “uncontroversial.”  As we stated in an earlier post, “FDA Takes It on the Chin Again in First Amendment Case”:

[T]he court’s discussion of the Zauderer “purely factual and uncontroversial information” test for compelled speech leaves us with some interesting hypotheticals to consider.  Remember, after New York Times v. Sullivan, [376 U.S. 254 (1964),] private tort claims are on par with other forms of governmental restrictions on speech for purposes of the First Amendment. Query whether plaintiffs demanding warnings about supposed causal relationships that are anything but “uncontroversial” might be running afoul of the First Amendment.

For one thing, NIFLA makes clear that the Zauderer exception applies to compelled speech generally.  138 S. Ct. at 2372-73.  For another thing, NIFLA, held that Zauderer “does not apply” to compelled speech that “in no way relates to the services that [the speakers] provide.”  Id. at 2372.  That comes up fairly frequently in product liability litigation, when plaintiffs claim that a defendant has a “duty” imposed by (usually) state law to include information not only about its product, but about the supposedly “safer” attributes of some competing product or treatment option.  We’ve discussed before reasons why so-called “comparative” warning claims should fail, but since such compelled warnings don’t involve the attributes of the defendant’s own product, there may also be a constitutional angle to work with here.  Nor can compelled comparative warnings for prescription medical products be considered “traditional,” since the FDA does not allow them (much less mandate them) except under strict conditions.  See 21 C.F.R. §201.57(c)(3)(v).

Content-based regulations, such as compelled speech, “are presumptively unconstitutional and may be justified only if the government proves that they are narrowly tailored to serve compelling state interests.”  138 S. Ct. at 2371.  Although NIFLA did not “question the legality of health and safety warnings long considered permissible,” id. at 2376, the Court had a lot to say about governmental manipulation of medically-related information:

Throughout history, governments have manipulated the content of doctor-patient discourse to increase state power and suppress minorities. . . .  [W]hen the government polices the content of professional speech, it can fail to preserve an uninhibited marketplace of ideas in which truth will ultimately prevail.  Professionals might have a host of good-faith disagreements, both with each other and with the government, on many topics in their respective fields.

Id. at 2374-75 (citations and quotation marks omitted).  The “benefit” of products (NIFLA offered the example of “medical marijuana”) can be a constitutionally protected dispute.  Id. at 2375. “Speaker-based laws run the risk that ‘the State has left unburdened those speakers whose messages are in accord with its own views.’”  Id. at 2378 (quoting Sorrell v. IMS Health, Inc., 564 U.S. 552, 557 (2011)).

Thus, think about what may fail to qualify as “noncontroversial” or “strictly factual” information in our product liability sandbox – thereby triggering strict (or at least “heightened”) scrutiny.  Those elements of the Zauderer test weren’t really issues in NIFLA; “abortion [is] anything but an ‘uncontroversial’ topic.”  138 S.Ct. at 2372.  But what about product liability?  Well, we have the holding in the aforementioned Sorrell decision that “[s]peech in aid of pharmaceutical marketing, however, is a form of expression protected by the Free Speech Clause of the First Amendment.”  564 U.S. at 557.  We have long been of the view that one side of a scientific conflict should not be able, under the First Amendment, to sue the other side into silence through tort litigation.

Thus, we believe that under NIFLA, there may be a constitutional dimension to the kind of scientific controversies normally addressed these days by Daubert.  Simply looking through our recent “best of” lists, we’ve seen quite a few examples of plaintiffs pursuing, on a massive scale, warning claims about purported product “risks” that were ultimately debunked on scientific grounds.  See In re Lipitor (Atorvastatin Calcium) Marketing, Sales Practices & Products Liability Litigation (No II) MDL 2502, 892 F.3d 624 (4th Cir. 2018) (Lipitor and diabetes); In re Zoloft (Sertraline Hydrochloride) Products Liability Litigation, 858 F.3d 787 (3d Cir. 2017) (Zoloft and birth defects); In re Mirena IUS Levonorgestrel-Related Products Liability Litigation, 341 F. Supp.3d 213 (S.D.N.Y. 2018) (Mirena and a particular form of high blood pressure); In re Mirena IUD Products Liability Litigation, 169 F. Supp.3d 396 (S.D.N.Y. 2016) (Mirena and perforation); In re Accutane Litigation, 191 A.3d 560 (N.J. 2018) (Accutane and bowel problems). There are many more such examples in the law books.

While Daubert is a perfectly fine way of dealing with some litigation over scientifically (and sometimes generally) controversial claims of product risk, perhaps the post-NIFLA First Amendment protection of compelled scientific speech would be another.  Turning back to ABevA, at least three concurring judges would have decided the case on the grounds that the compelled speech about sugary drinks contributing to “diabetes” was not “purely factual” (such drinks have no effect on certain types of diabetes) and thus “controversial.”

This warning does not provide “purely factual and uncontroversial information about the terms under which services will be available.”  The factual accuracy of the warning is disputed in the record.  Among other things, the warning is contrary to statements by the FDA. . . .  Moreover, . . . the disclosure is literally false with respect to Type I diabetes. Although NIFLA did not define “uncontroversial,” the warning here requires the advertisers to convey [the government’s] one-sided policy views. . . .  The record shows this is a controversial topic, and therefore, the ordinance does not qualify as “uncontroversial information” under the third prong of NIFLA.

ABevA, 2019 WL 387114, at *8 (citations omitted) (concurring opinion); see, id. at *11 (“it cannot be doubted that the government’s proposed message is controversial:  it would require that manufacturers, retailers, and advertisers include in their ads, under a banner that begins “Warning,” the message that their product contributes to diabetes even though the causes of type 1 diabetes are not actually known”) (another concurring opinion).  Query: If the claimed link between diabetes and sugary drinks in ABevA is sufficiently “controversial” to require heightened First Amendment scrutiny of a compelled warning, how can the at least equally scientifically bogus demand for a diabetes warning on Zoloft not be equally unconstitutional?

The question then becomes, what is the threshold for “controversial” under NIFLA?  It may well be considerably less stringent than the Daubert standard for lack of valid scientific support.  After all, abortion is “controversial” despite – indeed because of – there being two vigorously asserted, conflicting points of view.  A lot of scientific disputes may well be “controversial” under NIFLA, and thus First Amendment protected against warnings purportedly compelled by state law, even though neither side could prevail over the other side on Daubert grounds.  Such examples might include Proposition 65 carcinogenic warnings concerning cola drinks, coffee, beer, and soy sauce, see Riva v. Pepsico, Inc., 82 F. Supp.3d 1045, 1062 (N.D. Cal. 2015), and similarly dubiously supported cancer claims involving herbicides.  See National Ass’n of Wheat Growers v. Zeise, 309 F. Supp.3d 842, 846 (E.D. Cal. 2018).  Perhaps the opinion of a single outlier group (as was alleged in Zeise) may be enough to survive Daubert, but is questionable whether, when viewed as governmentally compelled speech about a scientifically contested risk, demands for such warnings could survive First Amendment analysis of the sort mandated by NIFLA and conducted by ABevA.  Indeed, a demand that a product warning adhere to a outlier scientific viewpoint would seem to be the epitome of “controversial,” at least within the relevant scientific community.

It seems clear to us that after NIFLA and ABevA, the kind of claim that the California Supreme Court allowed to withstand First Amendment challenge in Kasky v. Nike, Inc., 45 P.3d 243, 251-52 (Cal. 2002), compelling disclosure of a defendant’s controversial labor practices, could not occur now.  Moreover, given availability of rapid First Amendment-based relief to defendants under so-called SLAPP statutes, it may be cheaper and easier to seek First Amendment dismissal of state-law-based demands for controversial, or even untrue, safety warnings.  See Vess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1109-1024 (9th Cir. 2003) (SLAPP relief appropriate against groundless tort suit alleging scientifically doubtful drug-related risks).

One thing that was not decided, either in NIFLA or ABevA, is what degree of scrutiny applies to cases where the Zauderer exception allowing rational basis analysis is unavailable.  Both cases resolved First Amendment claims without clarifying that point, NIFLA holding that the compelled speech statute “cannot survive even intermediate scrutiny,” 138 S. Ct. at 2375; and ABevA striking down the compelled warning as “unduly burdensome” even under Zauderer.  2019 WL 38711, at *5.

But that’s why the already discussed holding in NIFLA that compelled speech is inherently “content-based,” 138 S. Ct. at 2371, is key.  That holding brings compelled speech within the rubric of Reed and Sorrell, holding that strict scrutiny, or at minimum “heightened” scrutiny, is required.

In sum, we don’t think that “compelled speech” rationale of NIFLA or ABevA is likely to affect the FDA very much. The Agency’s “valid scientific evidence” standards, and similar requirements for scientific support of label changes would appear to provide the basis for meeting the elements Zauderer exception.  The FDA’s prohibition on off-label communication has its own well-known First Amendment problems, but they don’t involve compelled speech, nor would the kind of disclaimers and “balance “ that might be alternative approaches to the FDA’s ban probably be anything but factual and non-controversial.  Finally, compelled speech analysis would not have much impact on product liability litigation where the risk of a prescription medical (or other) product is well-established and the only question is whether the plaintiff did or did not encounter it.

Where First Amendment compelled speech principles could have significant impact – and where we urge our readers to consider whether a compelled speech defense is available − is in the kinds of cases described above, where the existence of the risk itself is scientifically controversial and would attract a Daubert challenge.  In those situations, the standards for First Amendment protections may be easier to meet than Daubert, so the impact of cases like NIFLA and ABevA is something that may be helpful in the long run.  The defense could also rely on arguments (including FDA statements) against overwarning to support the constitutional defense.  At the very least, they provide a basis for avoiding “a proliferation of warnings and disclosures compelled by local municipal authorities that have only a tenuous link to a more than trivial government interest.”  ABevA, 2019 WL 387114, at *13 (concurring opinion).

Bexis is known to say that nothing good ever comes out of Missouri, but the Missouri Supreme Court has proven him wrong.  We have long made exceptions to Bexis’ proclamation for Mark Twain, Maya Angelou, and Kansas City barbeque, and we can now add to that list the Missouri Supreme Court’s new opinion in State ex rel. Johnson & Johnson v. Burlison, No. SC96704, 2019 WL 581175 (Mo. Feb. 13, 2019), where the Missouri Supreme Court took another step toward limiting the blatant forum shopping and venue abuse to which Missouri practitioners have become accustomed.

The controversy arises from Missouri’s unique and permissive joinder rules, which have been widely used to pile scores of non-resident plaintiffs into St. Louis City (which is different from St. Louis County) by joining their claims with those of one St. Louis City resident.  You can read our take on the issue here.  As you might expect, we have bemoaned this practice as unjustified and unfair.

The Burlison opinion is a game changer for the better.  In Burlison, one St. Louis City resident filed an action in St. Louis City along with dozens of non-Missouri plaintiffs against New Jersey and Delaware defendants.  The defendants filed motions to sever the non-residents and transfer their cases to other venues, which the court denied.  Id. at *1.  After multiple amended petitions (and an equal number of overruled objections to venue), the court set one plaintiff for trial—a resident of St. Louis County (which again is different from the City).  After yet another overruled objection to venue in St. Louis City, the defendants petitioned the Supreme Court for a writ of prohibition arguing that venue in St. Louis City was improper.  Id. at *2.

The Supreme Court agreed and held that Missouri’s permissive joinder rules could not trump the standard venue rules.  That is to say, plaintiffs who cannot themselves establish venue in St. Louis City cannot enter that forum through the backdoor by joining with one St. Louis City resident.  The opinion’s discussion started strong:

The central issue in this case is whether permissive joinder of separate claims may extend venue to a county when, absent joinder, venue in that county would not otherwise be proper for each claim.  It cannot and does not.  This is evidenced not only by our Court’s rules but also nearly 40 years of this Court’s precedent.

Id. at *3 (emphasis added).  The plaintiff had argued that the venue statute (Mo. Rev. Stat. § 508.010) does not dictate one specific venue when multiple joined plaintiffs claim their injuries occurred both inside and outside Missouri.  Moreover, the joinder rule (Civil Procedure Rule 52.05(a)) allows “two of more separate causes of action” to be joined in one petition.  Id.  Thus, according to the plaintiff, he and the other plaintiffs could unilaterally choose their venue, including St. Louis City, by banding together.  Id.

The problem for the plaintiff is that his position runs directly contrary to another Missouri rule—Rule 51.01, which expressly states that the rules of civil procedure “shall not be construed to extend or limit the jurisdiction of the Courts of Missouri or the venue of civil actions therein.”  Id. (emphasis in original).  Because the plaintiff could not have established venue in St. Louis City if he had sued on his own, he was relying on a rule of civil procedure (the joinder rule) to expand venue.  The rules and precedent applying them prohibit that result:

What Rule 51.01 and the holding in Turnbough [v. Gaertner, 589 S.W.2d 290, 292 (Mo. 1979)] make clear is joinder of [the plaintiff’s] claims with the other claims alleged in the petition cannot extend venue to a county where [the plaintiff’s] claims could not otherwise be brought and pursued.  Because [the plaintiff’s] wife was first injured in St. Louis County, § 508.010.4 dictates the proper venue for [the plaintiff’s] claims is St. Louis County.  The city of St. Louis is an improper venue . . . .”

Id. at *6 (emphasis added).  The Supreme Court therefore ordered the plaintiff’s claims severed and transferred to the proper venue.

There were two long dissents, which we will not parse here.  We will say, however, that one complains that “the Court holds that no plaintiff or claim can be joined with any other plaintiff or claim unless venue can be established independently for each claim” and that “[i]n the future, numerous claims that previously could have been filed together in one action—and in one venue—must now be filed separately.”  Id. at *14.  The dissent holds this out to be a self-evidently bad thing, but we (and a majority of the Missouri Supreme Court) clearly see this as the correct and proper result.  We do not see the good in allowing large groups of unrelated plaintiffs to join their claims together in a forum with which neither they nor their claims bear any relation, and we have always wondered why courts tolerate it.  Add the Missouri Supreme Court to the list of those that will not.

We’ve been waiting quite a while for the FDA to modernize its positions on the truthful off-label communications by regulated manufacturers.  Under current First Amendment practice, the FDA’s positions are quite likely unconstitutional as both speaker- and topic-based restrictions on the truthful communication of scientific information.  However, the best we’ve seen from the Agency to date was a “statement,” issued last June, that truthful off-label communications to third-party payers (or “payors,” if you’d rather) would henceforth be OK.  Further details were available in an FDA guidance issued at the same time.  We blogged about that statement here.

The June 2018 guidance, however, did not go beyond TPPs.  Id. at 22.  We editorialized at the time:

We fail to see how any constitutionally valid distinction can exist between providing the identical information, with identical disclaimers and limitations, to one “sophisticated” audience (third-party payors) while prohibiting that information’s distribution to another “sophisticated” audience – that being medical doctors that directly prescribe these drugs and devices. . . .  Thus, we believe that, as a practical matter, the OLP Guidance effectively dooms any First Amendment defensibility of an FDA ban on the same truthful information being distributed, in the same fashion, to the rest of the medical community. . . .  After all, just as third-party payers are sophisticated professionals . . ., so are the doctors directly involved in treating [their] patients.

Then, nothing.  Over the last eight months we’ve seen no detectable movement through either FDA guidance documents or, the pending process – a reassessment of which was announced two years ago (see our post here) – to amend the FDA’s archaic “intended use” regulations.

We’re not surprised that a lot of other people are tired of the FDA’s foot-dragging.  Among other things, the FDA stated in that guidance we mentioned above that it would be deferring to “existing current good research practices for substantiation developed by authoritative bodies.”  Guidance at 10.

One of those “authoritative bodies” is the Advanced Medical Technology Association (“AdvaMed,” for short), which describes itself as “a trade association that leads the effort to advance medical technology in order to achieve healthier lives and healthier economies around the world.  AdvaMed’s membership has reached over 400 members and more than 80 employees with a global presence.”  One of the things AdvaMed has done is to create a code of ethics for medical device manufacturers.  The last AdvaMed code was issued about a decade ago and was in need of updating.  So AdvaMed has prepared a new ethics code that’s due to become effective on January, 1, 2020.  The entire code is methodically discussed in a Reed Smith client alert, but for present purposes we’re interested section 10, entitled “Communicating for the Safe & Effective Use of Medical Technology.”

Full disclosure, as stated in the client alert: “Reed Smith was honored to serve as outside counsel to AdvaMed in connection with drafting the original, current, and revised versions of the AdvaMed Code.”

Section X of the new AdvaMed Code starts with a specific description of off-label use, so it’s obvious to all what the code is discussing:

Health Care Professionals may use a product for any use that they determine is in the best medical interests of their patients.  This includes uses that are contained in the Medical Technology’s labeling or otherwise consistent with such labeling, but it could also include uses that are not approved or cleared (i.e. “off-label” uses).  As recognized under U.S. law and by the FDA, off-label use of these Medical Technologies can be an important part of medical practice and may even constitute a medically recognized standard of care.

2020 AdvaMed Code at 29 (emphasis added).  One “key concept” that this section of the new AdvaMed code emphasizes is that “[a]ccess to truthful and non-misleading information relating to Medical Technologies is critical to a Health Care Professional’s ability to exercise his or her medical judgment, to provide high-quality care, and to safely use available Medical Technology.”  Id. (emphasis added).

Thus, AdvaMed has stopped waiting for the FDA and is taking the position that direct off-label communications between medical device manufacturers and the physicians (and other health care professionals) that use their products is 100% ethical if done in a truthful, transparent, and non-misleading fashion:

Industry appropriate communications of such information can include, among other activities:

  • Proper dissemination of peer-reviewed scientific and medical journal articles, reference texts, and clinical practice guidelines;

  • Presentations at educational and medical meetings regarding clinical trial results or research and development data for an investigational use (taking care that no claims are made regarding safety and effectiveness); and

  • Discussions with consultants and Health Care Professionals to obtain advice or feedback relating to topics such as unmet patient needs, product research and development, and the like.

Id.  AdvaMed’s ethical guidelines for such communications (which the FDA would call “promotion”) are about what one would expect a company with good marketing practices to employ generally – authorization, truth, and disclaimers:

  • Company responses that contain information regarding unapproved or uncleared uses should be provided by authorized personnel.

  • Company communications must be truthful and nonmisleading.

  • Information related to unapproved or uncleared uses should be identified as such.

Id. at 30.

Thus AdvaMed – one of the “authoritative bodies” to which the FDA has stated it would be deferring – has stepped up to the plate and declared that truthful manufacturer communication of off-label information to physicians and other health care practitioners is both ethical and desirable.  “Companies are encouraged to develop policies and controls that apply the principles above.”  Id.

FDA, the ball is in your court.  Either take command or lose control.  Industry is not going to wait forever for the Agency to bring its regulation of truthful commercial speech into the Twenty-First Century.

Moreover, from a litigation standpoint, the AdvaMed Code is what we call an “industry standard” (at least when it goes into effect in 2020), and in almost every jurisdiction in the country, compliance with industry standards is admissible evidence in product liability cases.  “[I]ndustry standards promulgated by trade associations” are “acceptable” as evidence in strict product liability cases.  Kim v. Toyota Motor Corp., 424 P.3d 290, 299 (Cal. 2018).  “[T]rade associations consist of manufacturers and other businesses whose conduct comprises the industry custom and practice.”  Id.  Accord, e.g., Adams v. Genie Industries, Inc., 929 N.E.2d 380, 385 (N.Y. 2010) (“weight” of an “industry standard for” the product “was up to the jury”); Mikolajczyk v. Ford Motor Co., 901 N.E.2d 329, 335 (Ill. 2008) (“conform[ance] with . . . guidelines provided by an authoritative voluntary association” held relevant to proving a “unreasonably dangerous” defect); Wash. Rev. Code §7.72.050(1) (“[e]vidence of custom in the product seller’s industry . . . may be considered by the trier of fact”).  So now, when plaintiffs start bleating about “off-label promotion” being such a horrible thing, we have evidence to point to that – provided it’s done correctly and in compliance with a company’s internal guidelines – such activity is recognized as proper and ethical.

Oh, yes, and Happy Valentine’s Day to everyone at the FDA.  Among other things, they keep the nation’s chocolate supply safe.

We’ve written several times (here, for example) about the Biomaterials Access Assurance Act (BAAA), 21 U.S.C. section 1604 et seq., and how it issues a get-out-of-litigation-free card to suppliers of raw materials and components. Today’s case, Connell v. Lima Corp. et al., 2019 WL 403855 (D. Idaho Jan. 30, 2019), supplies another illustration of the BAAA’s power. The plaintiffs sued for injuries after a hip prosthesis fractured. The defendants initially included the manufacturer and a supplier of component parts. The plaintiffs settled with the manufacturer and then directed their fire at the supplier. Big mistake. The remaining defendant moved for summary judgment, arguing that because all it had done was supply the stem and neck parts of the manufacturer’s hip system, all claims against it were preempted by the BAAA.

The plaintiff attempted to evade this rather clear preemption by recharacterizing the parts supplier as the actual manufacturer, and the (now-settled-out) manufacturer as a mere distributor. But, as John Adams said, facts are stubborn things. The actual, settled-out manufacturer had submitted the 510(k) application to the FDA, listing itself as the manufacturer of the “hip system,” which was made up of component parts. Moreover, the settled-out manufacturer – not the component parts supplier – had its name on the front of the IFU and the surgical technique brochure. The Supply Agreement between the manufacturer and the parts supplier also shed light on who was what. Importantly, when the settled-out manufacturer had received the component parts from the defendant supplier, those parts were not yet ready for implantation into a human being.

The plaintiffs’ product liability claims would not have been pre-empted by the BAAA if the remaining defendant acted (1) as manufacturer of the implant; (2) as seller of the implant; or (3) furnished raw materials or component parts for the implant that failed to meet applicable contractual requirements or specifications. But the answer was No, No, and No. The court considered whether there might be some basis to treat the parts supplier as a manufacturer of the implant. Under the BAAA, this exclusion applies only in three situations: first, if the parts supplier registered or was required to register with the Secretary of Health and Human Services and included or was required to include the implant on a list of devices filed with the Secretary; second, if the parts supplier was subject to a declaration issued by the Secretary that stated the company was required to so register and list the implant but filed to do so; and third, if the supplier was related by common ownership or control to the manufacturer. Again, three strikes and the plaintiffs were out. and that meant that the supplier defendant was out of the case. BAAA preemption applied and the parts supplier was dismissed.

Ever since innovator liability burst onto our consciousness a decade ago with the horrific decision in Conte v. Wyeth, 85 Cal. Rptr.3d 299 (Cal. App. 2008), we have had nightmares about the potential impact of this theory.  After all: (1) over 90% of all prescriptions these days are for generic drugs, and (2) plaintiffs claiming injury from generic drugs are largely prevented from suing their actual manufacturers due to preemption.  Even if generic drugs, by and large, generate less litigation per prescription than innovator drugs, due to their risks being better known over longer periods of use, imposing 100% of potential liability on less than 10% of the market, as innovator liability theories permit, would pose a massive threat to the innovator drug industry, and would send innovator drug prices skyrocketing.

Thus, we’ve manned the barricades against innovator liability since its inception.  The Blog maintains a comprehensive innovator liability scorecard, as well as an updated 50-state survey of innovator liability.  Appellate decisions on innovator liability – pro or con (thankfully, mostly con) have ranked highly on our annual top- and bottom-ten lists of the most significant cases of the year.  See 2018+1; 2018-1; 2017-1A; 2016-5; 2014+1; 2014+3; 2014-1; 2013+2; 2013-5; 2008-1.

But now we’re saying “woah,” at least a bit.  Two state high courts:  California in T.H. v. Novartis Pharmaceuticals Corp., 407 P.3d 18 (Cal. 2017), and Massachusetts in Rafferty v. Merck & Co., 92 N.E.3d 1205 (Mass. 2018), have allowed some form of innovator liability for a year or more, now.  We follow the legal press pretty closely on prescription medical product liability litigation issues, and we haven’t read anything about a flood of additional innovator liability cases – or even one − being filed in those states.  Indeed, we haven’t heard a peep out of the T.H. case itself since it was remanded after the California Supreme Court’s decision.  We checked with defense counsel, and no, T.H. hasn’t settled, but rather is proceeding towards trial in orderly fashion.

So what’s going on?  Has the existential threat of innovator liability turned into a paper tiger in practice?

We think the answer is, “hopefully.”  And that’s very good news for manufacturers of innovator drugs.  In retrospect, one of the reasons we experienced such a rash of innovator liability litigation after Mensing/Bartlett was that these preemption rulings left high and dry a lot of existing cases involving generic drugs.  In particular, the other side had been actively soliciting metoclopramide cases, so when the Supreme Court lowered the preemption boom, those lawyers were left like fish in a barrel – and innovator liability was one of the few tools at their disposal.  By now, in 2019, those metoclopramide cases have pretty much worked their way through the system.  We ran “metoclopramide” on Westlaw, and there hasn’t been a single trial court level metoclopramide decision of any sort on any topic since Raskas v. Teva Pharmaceuticals USA, Inc., 2018 WL 351820 (E.D. Mo. Jan. 8, 2018), over a year ago.

Nor has anything else significant taken the place of metoclopramide litigation.  Our innovator liability scorecard reflects only four decisions for all of 2018.  All four involved different drugs, and none was a metoclopramide case.  Entries into our generic preemption scorecard have also slowed dramatically.  Only eight cases involving generic preemption (that we’re aware of) were decided in all of 2018.  Every prior year, going back to Mensing in 2011, was well into double figures.  Nor are there really any targeted generic products any longer.  The eight generic preemption cases in 2018 involved seven drugs, with only amiodarone generating more than one judicial opinion.  Since our scorecards include every decision we find, both good and bad, they’re a pretty good indicator of what’s out there.

What we think this means is that preemption has been an excellent deterrent.  The other side doesn’t seem to be taking on many cases involving alleged injury from ingestion of generic drugs.  Seen any “bad drug” lawyer ads lately about generic drugs?  We haven’t either.  The post-Mensing onslaught of innovator liability claims wasn’t a portent, but was more of a last gasp.  That makes sense to us, too.  Innovator liability is another of these unusual theories of liability, like failure to update and failure to report adverse events to the FDA, that essentially didn’t exist in the absence of preemption.  Innovator liability lacks the simplicity and jury appeal of “they made it, they should pay” theories of strict liability and negligence.  All of the policy arguments that we’ve made against innovator liability have their jury-accessible equivalents, so this theory is another of these “bad” causes of action that plaintiffs pursue only when they have no other option.  It’s hard to prove liability, and harder to prove causation, so our opponents aren’t likely to bring innovator liability cases unless there’s some other significant incentive – usually in the form of big damages.

Thus, in terms of how innovator liability seems to be doing in practice, as opposed to theory, it’s looking more like a paper tiger than something that will actually pose an existential threat to our clients.  First of all, it remains an extreme minority theory.  As far as we know, not a single penny has ever been paid on a verdict based on innovator liability.  There are lots of other, less problematic, ways for our opponents to earn a living.  Short of some DES-like surprise latent injury from a popular generic drug, our best guess now is for innovator liability to be a one-off sort of claim asserted only in big damages/poor liability situations such as SJS/TENS cases.

It is easy to articulate the core principle behind the First Amendment right to free speech:  The government can’t restrict what you say or make you say what the government wants without a good reason.  Ah, but how good a reason and what kind of reason?  That is where it gets more complicated.  How do we distinguish, for example, between a law that requires every man, woman, and child to declare “All hail the mighty New England Patriots” in public every day and a law that requires certain government-approved warnings with prescription drugs.

Both represent the government compelling speech, but one passes Constitutional muster in its current form while the other clearly would not.  (Hint: The unconstitutional one is the hypothetical law compelling Patriot worship, which would be a bad idea with or without the First Amendment and might even run afoul of the prohibition on cruel and unusual punishment.)  Whether government regulation of speech violates the constitution depends on the nature of the regulation and the standard under which courts review the law, and all of this is put on display in the Ninth Circuit’s recent en banc opinion striking down San Francisco’s sugar-sweetened beverage warning law.  The case is American Beverage Ass’n v. City and County of San Francisco, — F.3d —, No. 16-16072, 2019 WL 387114 (9th Cir. Jan. 31, 2019), and while the entire eleven-judge panel agreed that San Francisco’s law violated the First Amendment, it filed four different opinions explaining why.

As far as public health policy goes, San Francisco’s beverage warning law was a clumsy effort.  It required that advertisements for sugar-sweetened beverages include the following warning in a size no smaller than 20 percent of the ad and set off in a rectangular box—a sort-of “black box” warning:

WARNING:  Drinking beverages with added sugar(s) contributes to obesity, diabetes, and tooth decay.  This is a message from the City and County of San Francisco.

Id. at *1.  The law applied to some sugary drinks—but not all.  It applied to some advertisements—but not all.  And, importantly, the warning was not factually true—sugary drinks do not contribute to Type 1 diabetes.  We are no fans of sugary drinks, but we can’t help but think that the law has a certain arbitrary feel to it.

So maybe the law could have been written better and maybe it represented debatable public policy.  But was it unconstitutional?  The majority decided that it was, and it came to that conclusion after applying a form of “rational basis” review and rejecting the application of heightened scrutiny.  That is to say, the government did not have to demonstrate that its regulation of commercial speech was “narrowly tailored” to a compelling governmental interest or that it met any other version of heightened scrutiny—strict, intermediate, or otherwise.  Id. at *4-*5.  Referring to Supreme Court precedent, the majority set the standard as follows:

[B]efore NIFLA [National Institute of Family & Life Advocates v. Becerra, 138 S. Ct. 2361 (2018)], we examined a similar health and safety warning and held squarely that Zauderer [v. Office of Disciplinary Counsel, 471 U.S. 626 (1985)] provides the proper analytical framework for considering required warnings on commercial products:  “[T]he government may compel truthful disclosure in commercial speech as long as the compelled disclosure is ‘reasonably related’ to a substantial governmental interest.”  CTIA, 854 F.3d at 1115-17.  We rejected the argument that intermediate scrutiny—as required by Central Hudson, 447 U.S. 557, for situations in which speech is restricted or prohibited—should govern.  We also rejected the argument that Zauderer applies only to situations in which the government requires disclosures to prevent consumer deception . . . .

Id. at *4 (Emphasis added).  Let’s unpack that a little bit.  At least when it comes to health and safety warnings, the Ninth Circuit held that the government can compel truthful disclosure so long as the disclosure is reasonably related to a substantial governmental objective.  That situation is to be distinguished from laws restricting or prohibiting commercial speech, to which intermediate scrutiny under Central Hudson would apply.  Then there is strict scrutiny, which should apply to certain other regulation of speech.

When it came to San Francisco’s beverage law, the Ninth Circuit majority applied the Zauderer three-part test to determine whether the law survived rational basis review:  Whether the notice is (1) purely factual, (2) noncontroversial, and (3) not unjustified or unduly burdensome.  Id. at *4.  The law fell on the third requirement:

On this record, the 20% [size] requirement is not justified when balanced against its likely burden on protected speech.  [¶]  In addition, . . . [San Francisco has] not shown that the contrasting rectangular border containing a warning that covers 20% of the advertisement does not “drown[ ] out” Plaintiffs’ messages and “effectively rule[ ] out the possibility of having [an advertisement] in the first place. . . .

The required warnings therefore offend Plaintiffs’ First Amendment rights by chilling protected speech.

Id. at *5.  We have no strong opinion on this particular law.  We are, however, surprised that the Ninth Circuit did not apply a heightened level of scrutiny.  The result would have been the same, but the court could justifiably have set the bar higher for laws that compel commercial speech.

That was the opinion of one judge who concurred in the result, but dissented “from most of the reasoning.”  Id. at *6-*10.  In this judge’s view, the San Francisco beverage law was a “content-based regulation of speech, which is subject to heightened scrutiny under the First Amendment unless the Zauderer exception applies.”  Id. at *6.  In other words, strict scrutiny applies unless the compelled notice is purely factual, noncontroversial, and not unjustified or unduly burdensome.  Id. at *7, and see supra.  Here, the factual accuracy of the required warning was disputed, and with regard to Type 1 diabetes the warning was literally false.  Id. at 8.

Moreover, the law was anything but “noncontroversial.”  To the contrary, “the warning here requires the advertisers to convey San Francisco’s one-sided policy views about sugar-sweetened beverages.”  Id.  Recall that the requirement that the compelled speech be “noncontroversial” comes from very recent Supreme Court authority, a 2018 opinion addressing mandated government messaging at prenatal clinics.  See NIFLA, 138 S. Ct. 2361.  If any “controversial” or “inaccurate” government-compelled message triggers heightened scrutiny, then why would that not apply to government-mandated drug warnings that similarly lack scientific support?  Food for thought.  Finally, requiring commercial speakers to “fight a government-scripted message that drowns out their own advertisements is unduly burdensome.”  Id.  Under these circumstances, heightened scrutiny should apply, and “[b]ecause the warning requirement is not narrowly drawn” to a substantial state interest, “it does not survive even intermediate scrutiny.”  Id. at *9.

Two other judges wrote separately to note that they would find the ordinance unconstitutional on the sole basis that it was not purely factual, which they believed to be a threshold question.  Yet another judge wrote that Central Hudson controlled and that “the Supreme Court held that regulation of commercial speech is evaluated under an intermediate scrutiny standard.”  Id. at *13.  Although this final opinion did not garner a majority, it cut to the core of the dispute with this conclusion:  “I share . . . concerns that our current case law [applying rational basis review] will lead to a ‘proliferation of warnings and disclosures compelled by local municipal authorities’ that have ‘only a tenuous link to a ‘more than trivial government interest.’”  Id. at *13 (internal citations omitted).  This captures the classic First Amendment question:  How good a reason and what kind of reason does the government need to restrict what you say or compel you to say what the government wants?  The majority answered that the government can compel truthful disclosure that is reasonably related to a substantial governmental interest.  A minority would have held the government to a greater level of scrutiny.

We have a feeling we have not heard the last of this, particularly as to what is, or is not “purely factual” and “noncontroversial,” and particularly as to the level of scrutiny required to satisfy the First Amendment test.  In many drug and medical device cases, plaintiffs are positing liability on theories that defendants should have warned (thus seeking to compel speech in the form of warnings) about risks or other information that the FDA has concluded are not scientifically based.  If scientific basis, or its absence, equates to either the “purely factual” or “noncontroversial” elements of an emerging First Amendment test, then the basis exists for a new constitutional defense in a significant number of prescription medical product liability actions.  And as to California, requiring governmentally compelled warnings to have sufficient scientific basis as to be “noncontroversial” has obvious implications for that state’s Proposition 65.

We all know the phrase “the elephant in the room.” There are some things that do not get mentioned that are so obviously relevant that silence about them, or willful ignorance of them, can be humorous or frustrating. Based on our not-so-extensive research, we see that the origin of the fairly widespread use of this phrase is disputed, possibly dating to Russian fable that was referenced in a Russian novel. Not being terribly invested in the issue, we did not go to the original sources to try to understand the facts. We also are not going to detail all of our prior discussion on why the First Amendment cannot be ignored in evaluating claims of liability based on alleged off-label promotion of approved/cleared drugs and devices. Because of the First Amendment, activities “promoting” an off-label use are not automatically wrongful, like they were once construed to be. Truthful statements are protected commercial speech. False and misleading statements are not. Whether in a criminal case brought by FDA, a False Claims Act case where the United States has intervened, a consumer fraud class, a third-party payor case, a product liability case, or something else, we would think that a presiding court would be wise to go beyond the label “off-label promotion” and see if the liability is supposed to be based on truthful statements or false statements.

The First Circuit decision in In re Celexa and Lexapro Marketing and Sales Practices Litigation, — F.3d –, 2019 WL 364019 (1st Cir. Jan. 30, 2019), does not mention the First Amendment. It makes no attempt to distinguish between purportedly culpable conduct that involved statements that were truthful versus those that were false. Versions of the word “truthful” are missing, “false” only appears in discussing cases under the False Claims Act, and “misleading” appears once. Back when the First Circuit issued its lousy trilogy of Neurontin decisions, before Amarin had played out and FDA effectively acknowledged truthful off-label promotion was lawful, we might have expected such inattention to this distinction. It is hard to justify it now, however. It is also hard to justify how the decision glossed over the underlying facts.

The district court issued a number of decisions before the appeal, including the denial of class certification we discussed here and the granting of summary judgment we discussed here. Only two of the plaintiffs from below perfected their appeal and the appellate decision did a little picking and choosing of what it addressed. We will do the same and focus on the summary judgment part, which was reversed. (The class certification denial was upheld because the class claims were time-barred. If you want to read about American Pipe tolling and how unsealing a FCA complaint where the U.S. had intervened can start the RICO clock, then check out 2019 WL 364019, **8-10.) The remaining plaintiffs sought recovery under RICO and Minnesota state consumer fraud and unfair trade practice statutes, although only RICO is analyzed. The first plaintiff is described by the First Circuit as having “purchased Celexa and Lexapro for her young son from February 2003 through March 2010 on the recommendation of her son’s neurologist.” Id. at *3. We know from the decision below that these were prescriptions to treat autism from age 8 through 15 and that the treating physician testified that the drugs were effective in the boy’s case. The second plaintiff was a union health fund that included pediatric use of Celexa and Lexapro on its formulary, but had paid for a small portion of pediatric claims for all indications submitted for Celexa from 1999 to 2004 (16/72, 22%) and for Lexapro from 2002 to 2015 (31/234, 13%). Id. at *2 & n. 8-9. Each sought reimbursement—an unknown amount for the first plaintiff and about $26,000 for the second—and RICO penalties for paying for these prescriptions under the theory that defendants had promoted the use of Celexa and Lexapro for depression in patients under 18 and that payment for these drugs constituted an economic injury because they allegedly were not proven to be effective for depression in patients under 18.

If you are following along, then you might see some issues here and why we pointed out that not going to the original sources to get the facts can hamper an analysis. In the manner of a lazy orator, we will pose some of these issues as questions we will not answer. What sort of economic injury exists when you get the product you paid for at the price you intended to pay? For a third-party payor that negotiates the prices it pays and obviously decided whether to pay on a claim-by-claim basis—choosing not to do so 78-87% of the time—how can there be an economic injury and how could it be analyzed except on a claim-by-claim basis? How can the use of a drug for autism, effective per the doctors who kept prescribing it, be based on whether the drug was effective for depression in any age population? Why would cases involving such low amounts of purported actual damages get pursued so aggressively? Given that every off-label prescription here was written by a doctor who knew it was off-label and had the right to write the prescription anyway, how can there be liability? The court did not provide clear answers to most of these questions either.

Operating under the Neurontin framework, the court started with the premise that all promotion (undefined) for off-label uses was wrongful and proceeded to characterize the record as “strongly suggest[ing] that Forest engaged in a comprehensive off-label marketing scheme from 1998 through 2009 aimed at fraudulently inducing doctors to write pediatric prescriptions of Celexa and Lexapro when Forest had insufficient reason to think that these drugs were effective for the treatment of depression in children and adolescents.” Id. at *2. More specifically, the defendant was alleged to have promoted the use of both drugs for pediatric depression in various ways and to have concealed “negative clinical studies concerning Celexa’s efficacy and safety.” Id. Again, none of the allegations seemed limited to false and misleading statements or focused on the impact on the particular prescriptions—for autism and more general pediatric use—for which plaintiffs claimed injury. In addition to recounting that the manufacturer pled guilty to criminal FCA charges on off-label promotion and settlement of related civil FCA claims—before the First Amendment shift—the court noted some relevant FDA history. “In 2009, the FDA approved Lexapro for the treatment of depression in adolescents (i.e., individuals of ages twelve through seventeen).” Id. at *1. FDA also determined that one of the pivotal studies that it considered in approving Lexapro as safe and effective for depression in adolescents also applied to use of Celexa for pediatric depression. Id. at *4. Plaintiffs offered various criticisms of this and other studies, which the court generally credited as supporting that the drugs were ineffective for pediatric depression. It failed to note something the district court had noted when it granted summary judgment: FDA had and considered all the study evidence that plaintiffs claimed showed the opposite of what FDA found. That makes it really hard to prove their case without inviting the jury to conclude that FDA got it wrong.

Preemption, you say. RICO is a federal statute, so the Supremacy Clause does not apply. Whether the Minnesota statutes would be preempted was not examined. What was examined, without labeling it primary jurisdiction, was whether “the FDA’s various pronouncements or actions close the door on any effort to convince a jury that either Celexa or Lexapro was ineffective.” Id. We do not think that was the right question to ask, but the court got the wrong answer anyway. In concluding that the plaintiffs were free to invite the jury to second-guess the FDA’s conclusion that Lexapro was effective for pediatric depression (and related conclusions), the court missed the big picture. The court found its ruling in D’Agostino, which affirmed the dismissal of a FCA case predicated on fraud-on-the-FDA, did not apply because the manufacturer “could not have pleaded on FDA approval” when it allegedly promoted off-label use. Id. at *5. We do not see what reliance has to do with allowing second-guessing of FDA. The court also found its ruling in an earlier appeal from the same litigation, which held that a consumer claim based on an approved label and no new safety information was preempted, did not apply because, well, it was about preemption.

From there, the court’s reasoning escapes us—although we do appreciate the nod toward the relevance of FDA evidence to state law claims:

The common law has long recognized that agency approval of this type is relevant in tort suits. See Restatement (Third) of Torts: Prod. Liab. § 4 (Am. Law Inst. 1998) (“[C]ompliance with an applicable product safety statute … is properly considered in [a product defect case].”). But the common law also recognizes that such evidence is not always preclusive. Id. (“[S]uch compliance does not preclude as a matter of law a finding of product defect.”). And while there are strong reasons for treating such evidence as preclusive when the challenged sales are made in reliance on agency approval, those same reasons cut the other way when the sales are made without approval, and certainly when made unlawfully, as we must assume they were here.

Id. at *5. Consistent with such fuzzy reasoning, it was not unexpected that the court would find that the evidence of lack of efficacy that plaintiffs had was enough to raise a question of fact.

The leap from a dispute about efficacy in general to economic injury for the plaintiffs was not really explored. Nor was how the individual plaintiff—the mother of autistic child—could prove causation. How the union health fund could prove causation was addressed and we will not dwell too much on it here. Suffice it to say evidence tending to say promotion increased prescriptions in general was seen as more probative than evidence about what the fund actually did in connection with the less than fifty prescriptions it reimbursed. Talk about ignoring the elephant in the room.