It took us a long time to understand how off-label promotion of prescription drugs had anything to do with the False Claims Act, and we’re still not so sure that the two are a fit. The FCA penalizes anyone who presents, or causes to be presented, to the federal government “a false or fraudulent claim for payment or approval.”  31 U.S.C. § 3729(a)(1).  Easy, right?  As we explained just last month in this quick primer on the FCA, Congress enacted the FCA after the Civil War to curb abuses in government procurement.  That part we get.  If you sell the Army 1,000 horses and send them a bill for 2,000 horses, that’s a false claim.

We’re writing about this today because the First Circuit issued an opinion last month that comes to the correct result and also illustrates how FCA claims are alleged in connection with off-label promotion—and how they fail. In Lawton v. Takeda Pharmaceuticals Co., No. 16-1382, 2016 U.S. App. LEXIS 20943 (11th Cir. Nov. 22, 2016), a patent lawyer filed a qui tam action against the manufacturer of a prescription diabetes medication.  He did not actually use the medication, nor did he buy or sell it.  So what did he allege?  He alleged that the manufacturer engaged in an elaborate scheme to promote the drug for un-approved uses—off-label promotion—and that the manufacturer thereby induced medical providers to make allegedly false claims for reimbursement to Medicare and Medicaid. Id. at **4-7.

It’s a two-step process. The manufacturer did not itself make a false claim, but rather engaged in alleged conduct that induced someone else to make a claim, whether the claimant knew it was false or not.  The problem for the plaintiff (or more accurately, the “relator”) is that he alleged neither falseness nor a claim.  We call that a double whammy.  Or maybe it’s a double fault.

You can call it whatever you want, but the district court called it “dismissed with prejudice,” and the First Circuit affirmed. The first really interesting thing is that the district court and the First Circuit applied Rule 9(b)’s heightened pleading standard across the board.  That is to say, the plaintiff had to allege with particularity the circumstances of the alleged fraud and the facts surrounding the claims themselves. Id. at **8-10.  Because justice cannot operate in a vacuum, we think that rule is only fair.

On falseness, the court recounted the plaintiff’s allegations of off-label promotion in some detail: The company allegedly paid doctors to conduct studies that supported the off-label use, but which were later criticized.  The company also allegedly mobilized “thought leaders” and a “specialized” sales force to promote the unapproved use of the product to physicians. Id. at **4-7.  The First Circuit characterized this as the manufacturer’s alleged “marketing machinations,” but what is obviously missing from this story?  There is no allegation that the company said anything false or misleading.  Recall that this is a False Claims Act case.  We are aware of the authorities holding that off-label promotion, even truthful off-label promotion, can form the basis of an FCA action, but we do not agree with them.  From our point of view, the court could have rejected this action for failure to allege falseness.

But that is not what the First Circuit did. Instead, the court held that the plaintiff had not alleged a claim.  He alleged generally that some portion of the prescriptions for the drug were written off label and that Medicare and Medicaid funds had generally been used to pay for the drug.  But that was not sufficiently particular.  The applicable standard typically required allegations stating “specific medical providers who allegedly submitted false claims, the rough time periods, locations, amounts of the claims, and the specific government program to which the claims were made.” Id. at **9-10 (internal quotations omitted).  As the court further explained:

[D]etails concerning the dates of the claims, the content of the forms or bills submitted, their identification numbers, the amount of money charged to the government, the particular goods or services for which the government was billed, the individuals involved in the billing, and the length of time between the alleged fraudulent practices and the submission of claims based on those practices are the types of information that may help a relator to state his or her claims with particularity.

Id. at *10. The plaintiff’s speculative generalizations did not come close to meeting this pleading burden.  As the court held,

 [Plaintiff] merely alleges that off-label prescriptions of [the product] submitted to government programs were unlawful.  But [he] . . . identifies no false claims, either individual or aggregated, from particular medical providers that were submitted for reimbursement.  [¶]  Instead [he] simply postulates that “as much as” 30% of [the product’s] annual sales were for off-label prescriptions, points to the amounts of Medicare and Medicaid funds used to pay for [product] prescriptions . . . , and asks us to infer that a portion of these funds must have been used to pay unlawful claims.  As Yogi Berra allegedly said, “It’s like déjà vu all over again.”

Id. at *12. Okay, we don’t fully understand the Yogi Berra reference, but the court made its point.  It did not suffice to allege the possibility of a false claim; the plaintiff had to allege specific facts demonstrating that someone had made a false claim for reimbursement from the government.  The court did not exclude the possibility that a plaintiff could meet his or her pleading burden using statistical evidence, but this plaintiff offered evidence and argument “more by insinuation.” Id. at *13.

Such insinuation did not state a claim, and because the federal court applied Rule 9(b) also to the plaintiff’s allegations of state law fraud-based claims, the plaintiff had not sufficiently alleged state-law claims either. Id. at **13-14.  In the end, the court’s application of Rule 9(b)’s particularized pleading standard to all aspects of the case is probably the most noteworthy part of opinion.  We will store that one away for future reference.

Well that was something. When we left you last Thursday, the jury for the third bellwether trial in the Pinnacle Hip Implant MDL had just started its deliberations, and we once again expressed concern over the trial’s evidentiary and procedural rulings and the effect they might have on the verdict. Our concern-level was high. Last time, amidst similar concerns, the jury came back with a half-billion dollar verdict.

Apparently that was chump change. Everything is bigger in Texas. And this time it was over one billion. Let that sink in. Over one billion. That’s a massive amount of money. Has anyone even ever won that in a lottery? It’s 1,000 winners of Who Wants to Be A Millionaire. And then you have to add about 40 more winners because the actual verdict was about $1.04 billion.

It’s hard to believe that something didn’t go awry here—a second time. And, like the last time, we aren’t being Monday-morning quarterbacks. We saw the signs well in advance.

So what’s next? Well, this reality-shattering amount can’t stand. Over one-billion of it is punitive damages. That’s a heck of a multiplier. Somewhere along the line, either at the trial court or on appeal, it will be struck down. Maybe more important, the massive amount of the verdict has to scream to the Fifth Circuit: PROBLEMS!!! . . . Right?

The MDL court has scheduled another bellwether trial in September 2017. You can bet that the defendants will move to stay that trial pending rulings on appeals to the Fifth Circuit, including the appeal from the second bellwether trial and this one too.

The MDL Court denied the same motion before this trial, so you’d have to think it will likely do so again. Then there will be another writ of mandamus to the Fifth Circuit, something that was also denied before this last trial. Will it do so again? Oh boy, this is something.

It is always nice to win a case, whether by motion or trial. But just in terms of pure exhilaration, it is hard to beat hearing the jury foreperson announce that, after a hard-fought trial, you win. But note that term “hard-fought.” Most trials really are hard. They really are expensive. They really are stressful. The road to even the most resoundingly wonderful verdict probably had a couple of nasty potholes. That was the case with Horrillo v. Cook Inc., 2016 U.S. App. LEXIS 21026 (11th Cir. Nov. 23, 2016). Prior to trial, there was at least one Daubert ruling that couldn’t have pleased the defense. Also, as reported by our friends in the Abnormal Use blog, there was a learned intermediary ruling that we do not like one bit. But all’s well that ends well, right?

In Horrillo, the plaintiff brought a product liability action on behalf of his deceased mother, who had undergone a surgery to clear her renal artery. The surgery went terribly wrong, as the patient sustained a stroke. The opinion also does not tell us whether the plaintiff ever sued the doctor. The surgeon used a stent manufactured by the defendant. That stent was designed for use in bile ducts, but the surgeon used it off-label in this case. That off-label use was apparently not all that uncommon. The plaintiff’s legal theories included negligence and negligent failure to warn, strict products liability and strict failure to warn, and breach of warranty. After a nearly four-week trial, the jury returned a verdict in favor of the defendant. The plaintiff then moved for a judgment notwithstanding the verdict, or, in the alternative, a new trial. The trial court denied those motions, and the plaintiff appealed to the 11th Circuit. Applying the appropriate standards of review, the 11th Circuit affirmed the trial court’s rulings and the defense verdict.

First, the appellate court upheld the trial court’s exclusion of evidence that four patients in a post-incident clinical trial of the defendant’s renal stent suffered strokes. The court held that such evidence was both irrelevant and prejudicial, and that nothing had occurred during the course of the trial to “open the door” to such evidence being introduced on rebuttal. Clearly, post-incident evidence could not possibly support an allegation that the defendant was on notice of the strokes and should therefor have enhanced the label’s warnings. We cannot tell from the opinion whether the plaintiff also argued that the post-incident evidence should have been admissible to prove medical causation. If that argument was made, it was obviously rejected, and rightly so; four strokes hardly proves causation.

Second, the appellate court held that the district court did not abuse its discretion when it excluded from evidence the label attached to the defendant’s stent years after the decedent’s surgery. Federal Rule of Evidence 407 provides: ‘When measures are taken that would have made an earlier injury or harm less likely to occur, evidence of the subsequent measures is not admissible to prove: negligence; culpable conduct; a defect in a product or its design; or a need for a warning or instruction. But the court may admit this evidence for another purpose, such as impeachment or–if disputed–proving ownership, control, or the feasibility of precautionary measures.” The defendant almost certainly did not assert lack of feasibility of adding a warning, so Rule 407 properly operated to exclude the later label. Moreover, the trial court understood how incredibly prejudicial evidence of the later label would be, and the 11th Circuit agreed.

Third, the record showed that the jury’s verdict was “overwhelmingly supported by evidence presented at trial.” The defendant introduced “compelling and significant testimony and documents that would easily allow the jury to conclude that the defendant did not promote off-label uses of the biliary stent, was unaware of any risk of stroke associated with its use in renal arteries at the time of the decedent’s procedure, did not violate any alleged duty to warn, and did not cause the injury from either a medical or legal perspective.” Reversing a jury’s verdict on strength of evidence is difficult to do anyway, but the 11th Circuit’s endorsement of the defense verdict is quite strong and across-the-board.

Finally, the appellate court held that the jury instructions and verdict form together “accurately instructed the jury on the applicable law, and were not misleading or confusing in any way.” The 11th Circuit’s decision does not supply details that might mislead or confuse us, so we are in no position to disagree (not that there’s any chance we would).

The Horrillo trial itself, and getting to trial, might have been a drawn-out, unpleasant ordeal, but the folks on the defense side must have enjoyed reading the Eleventh Circuit’s opinion – almost as much as they enjoyed hearing the jury verdict in open court.

It’s been two years since we applauded the downfall of Azzarello in Pennsylvania. Two years since the Pennsylvania Supreme Court ruling in Tincher v. Omega Flex, Inc., 104 A.3d 328 (Pa. 2014). Two years since we opined that we didn’t think Tincher changed Pennsylvania law applicable to prescription medical products much at all. After all, Hahn v. Richter, 673 A.2d 888 excluded prescription medical products entirely from Azzarello strict liability twenty years ago, so Tincher’s reworking of strict liability shouldn’t be of much consequence. And, our prediction has largely held true. We really haven’t mentioned Tincher much since here on the DDL blog, other than to point out the serious flaws in plaintiffs’ attempts to argue that Tincher somehow altered Pennsylvania’s negligence-only standard for prescription medical product litigation and that plaintiffs’ theory had been rejected by the first courts to consider it.

Now, two years later, we have to report that a Pennsylvania federal court used Tincher to allow a strict liability manufacturing defect claim to proceed in a medical device case – in what we view as a misconstruction of both Tincher specifically and Pennsylvania products liability law (especially post-Lance) generally.

The case is Wagner v. Kimberly-Clark Corp., slip op., No. 16-4209 (E.D. Pa. Dec. 1, 2016). During the installation of a feeding tube, a piece of the tube came off in plaintiff’s stomach and she had to undergo several procedures to have to have it removed. Wagner, slip op. at 2-3. Plaintiff’s complaint brings claims for negligence, strict liability, and breach of warranty. Defendant moved to dismiss the latter two claims. Id. at 1. Plaintiff did not oppose dismissal of the breach of warranty claim. Id. at 13. As for strict liability, the court dismissed strict liability design defect and failure to warn on the ground that neither is allowed under Pennsylvania law for prescription medical products. Id. at 6 n.3. But the court was unwilling to find the same was true as to plaintiff’s strict liability manufacturing defect claim.

We thought the issue of strict liability manufacturing defect had been put to rest, or at least into a very deep slumber, after Lance v. Wyeth, 85 A.3d 434 (Pa. 2014). It was our tiny sliver of a silver lining to Lance, that the Pennsylvania Supreme Court reaffirmed prior law precluding all strict liability in prescription medical product cases:

Plaintiff contends that Hahn does not prevent strict liability claims based on manufacturing defects.  This Court does not agree.  Although federal courts are currently split on this issue of whether 402A applies to medical devices, and some allow strict liability claims to proceed when a manufacturing defect is alleged, the decisions of these courts pre-date Lance.  There, the Pennsylvania Supreme Court reiterated the principle that a strict liability claim based on a defective prescription drug is barred.  In explaining this principle, the Court did not exempt from this bar a claim based on a manufacturing defect.  Based on the above, this Court predicts that the Supreme Court of Pennsylvania would come to the same conclusion with respect to defective medical devices.

Terrell v. Davol, Inc., 2014 WL 3746532, at *5 (E.D. Pa. July 30, 2014). But unlike Terrell, Wagner relies exclusively on pre-Lance cases that allow strict liability manufacturing defect claims. Wagner, slip op. at 8. In response to defendant’s argument that the court should be looking at more recent precedent, the court stated that regardless of date, there remains a split of authority. Id. at 12 n.9. But date is very important if all the cases that allow the claim pre-date a Pennsylvania Supreme Court decision disallowing it.

It is with this outdated frame of reference that the Wagner court then applies the Tincher ruling that “[n]o product is expressly exempt [from strict liability] and, as a result, the presumption is that strict liability may be available with respect to any product, provided that the evidence is sufficient to prove a defect.” Id. at 9. But Tincher explicitly recognized that prescription medical products are the exception to the “any product” rule. The Tincher Court did that by citing to Hahn. See Tincher, 104 A.3d at 382 (“but see Hahn v. Richter, 543 Pa. 558, 673 A.2d 888 (Pa. 1996) (manufacturer immune from strict liability defective design claim premised upon sale of prescription drugs without adequate warning”) (emphasis added).  Wagner reads this as adopting an exception for prescription drugs but not for prescription medical devices. Id. at 11 n.8. In other words, Wagner reads into Tincher that it purposely drew a distinction between prescription drugs (which were not before it) and prescription medical devices (which were also not before it). But that requires the court to completely ignore the overwhelming precedent, in Pennsylvania and nationally, equating prescription drugs and prescription medical devices for comment k purposes. Doing just that, Wagner concludes that the surgically installed feeding tube is more like the bricks at issue in Tincher than the prescription drug at issue in Hahn. Id. at 9.

So, Wagner looks to old cases that allow strict liability manufacturing claims against both prescription drugs and medical devices and interprets the non-prescription medical product case of Tincher to exempt from strict liability only prescription drugs and arrives at the conclusion that Pennsylvania would recognize strict liability manufacturing defect claims for medical devices. To borrow from our prior post in which we disdainfully responded to this type of use of Tincher, “[i]t makes no sense that Tincher, which was primarily devoted to moving strict liability design defect cases closer to negligence, would somehow expand strict liability sub silentio (that’s legal Latin for “without explicitly saying so”) in the prescription medical product area, while simultaneously reining it in everywhere else.” We think the same of the decision in Wagner. It makes no sense. It is an unsupported expansion of Pennsylvania prescription medical products law. Tincher is a great decision. It completely revamped strict liability in Pennsylvania. But strict liability does not apply to prescription medical products in Pennsylvania and never has – in any form. Tincher doesn’t change that.

We blogged about possibly interesting nuggets in the 21st Century Cures Act (“21CCA”) back in February, 2015 – when it was only 400 pages long.  In true congressional fashion, it’s now twice as long and loaded up with enough goodies (mostly of the $$$ variety) that it just passed the House of Representatives by a 392 to 26 margin.  It thus seems poised to become law.  Given the prospects for imminent passage, we decided to revisit this monster and see if there’s anything more of interest to product liability defendants.  We aren’t interested in the spending-related aspects of this bill, which are what’s really greasing its skids.

So here goes.

Preemption

The first thing we wanted to see is if there is any preemption of civil lawsuits, so we searched the text of the bill for the word “state.” More than 100 matches.

We looked through them all and didn’t find any preemption provisions that could be useful in product liability litigation. Dry hole, that.

Off-Label Promotion and First Amendment Issues

However, some of the appearances of the word “state” did occur in sections of the 21CCA that were of interest for other reasons. The most promising material we found relates to our continuing interest in off-label promotion and the First Amendment.

One thing we’ve found is subtitle F, entitled “Facilitating Responsible Manufacturer Communications.” Our reading of the amendment to the FDCA’s definition of “false and misleading label” (21 U.S.C. §352(a)) looks like Congress is poised to legalize the provision by regulated manufacturers of some information about off-label uses to third-party payors, formulary committees and other entities that decide whether uses of drugs are reimbursable.  The off-label issue is addressed by disclaimers:  “a conspicuous and prominent statement describing any material differences between the health care economic information and the labeling approved for the drug.”  21CCA §2101(4).  It doesn’t cover pure off-label promotion (§2101(5) – new §(2)(A)), but the connection of the information to on-label uses would no longer be limited by the phrase “directly relates.”

This legalization should get rid of some of the current TPP (as plaintiffs) litigation over purported “illegal” off-label drug promotion. More broadly, for First Amendment purposes, it demonstrates the feasibility of the disclaimer alternative to the FDA’s increasingly tattered flat ban.

Oddly, this new language applies only to “drugs” and does not mention devices. Device companies might want to complain to their senators (since it’s passed the House) about this disparate and unequal treatment.

As to off-label promotion generally, there’s this congressionally mandated deadline:

Not later than 18 months after the date of enactment of this Act, the Secretary of Health and Human Services shall issue draft guidance on facilitating the responsible dissemination of truthful and nonmisleading scientific and medical information not included in the approved labeling of drugs and devices.

21CCA §2102(a). The FDA has been dragging its feet on off-label promotion and the First Amendment literally for years.  Congress might not be able to decide what it wants to do, but it recognizes that something must be done, and soon, but why only “draft guidance”?   That’s not legally binding.  What the FDA needs to do is update and create new regulations.

Congress labored mightily and brought forth this mouse.

Another recurring issue in First Amendment/off-label promotion litigation is what replaces the FDA’s “substantial scientific evidence” (two double-blinded clinical trials) standard for truthful off-label promotion.  Defenders of the FDA’s ban raise the prospect of a slippery slope if anything less is considered not “false and misleading” for First Amendment purposes.

We recommend reviewing 21CCA §511 as an alternative. The 21CCA is proposing to allow new antibiotics and antifungals – to fight multi-drug resistant organisms, a major public health problem – be marketed with less than the FDA’s current scientific evidence floor behind them.  Since less restrictive alternatives are one aspect of First Amendment protection of commercial speech, it’s nice for Congress to provide advocates of truthful off-label promotion with such an alternative.

Sections 511(b)(2)(C), 511(b)(4), and 511(e)(2)(b) indicate how far down the slippery slope Congress is willing to go.

We point out that the 21CCA attempts to limit its jettisoning of the substantial evidence standard to these products, §511(g), but we doubt that the First Amendment, and particularly the “topic” analysis of Reed v. Town of Gilbert, 135 S. Ct. 2218 (2015), permits such content- and speaker-based discrimination.  Also there’s plenty of First Amendment authority (that we mentioned here) for the proposition that restrictions on speech that are shot full of holes and exceptions fail to “directly advance” purported governmental interests for the restrictions.  The 21CCA adds more such exceptions to and already porous prohibition.

Evidence

Since plaintiffs love to impugn all payments that physicians receive from our clients, another useful provision of the 21CCA is §3041, which eliminates from federal “transparency” reporting a variety of payments made for continuing medical education (“CME”) purposes, under certain limited circumstances – CME “that does not commercially promote a covered drug, device, biological, or medical supply” and payment of “the tuition required to attend an educational event.”  It’s not a lot, but it’s something.

This section would support the argument that, since Congress explicitly exempts them from reporting, there’s nothing questionable about these types of payments.

*          *          *          *

And that’s it. For an FDA-related bill that long, it’s pretty thin gruel.  Maybe our clients will fare better in the next Congress.

As we head into December, there is quite a bit of attention being paid to when sales start, when shipping occurs, and when gifts are given.  Were one concerned with such an inquiry, one might imagine a few different points in time when gifting might commence.  For purposes of our space-filling exercise, assume the putative gift is tangible, labeled to identify the intended recipient, wrapped such that it must be opened to reveal its contents, and left in a place where the intended recipient is expected to retrieve it.  Has gifting commenced when the giftor leaves the gift in this place, even if it might be removed before the giftee assumes possession?  Need there be some last clear chance when the gift can no longer be removed or replaced with something else before the giftee claims it?  Must there be a direction like “open it” to signal an exchange?  What if the gift has labeling that states that it cannot be opened for another six weeks or so?  If the “gift” is merely a box containing a note that an actual gift will be forthcoming, then was there a gift at all?  What if we droned on and on?

Goldthrip v. DePuy Orthopaedics, Inc., __ Fed. Appx. __, 2016 WL 6933450 (11th Cir. Dec. 28, 2016), involves these exact same issues if one can consider a product liability lawsuit a gift and an Alabama courthouse a suitable place for receiving such a gift.  In Goldthrip, the plaintiff alleged that her implanted prosthetic hip manufactured by defendants injured her on December 25, 2013.  As this was a day when many Alabamians were exchanging gifts, we can guess that the timing of the injury was easy to identify.  The plaintiff filed her case on December 23, 2015, two days before the statute expired and another day of mass gifting.  Her complaint, however, came with a curious note, indicating that she was “‘withholding service of process’ in an effort to avoid expenses and facilitate settlement discussions.” Id. at *1.  The complaint was served on the defendant (without a summons) a week later, a summons was issued about six weeks after that, and the defendant was served with the summons sometime later.  (If you are wondering, Fed. R. Civ. P. 4(c) provides that “A summons must be served with a copy of the complaint. The plaintiff is responsible for having the summons and complaint served within the time allowed by Rule 4(m) and must furnish the necessary copies to the person who makes service.”  Service of the summons and complaint together, absent waiver, is necessary to get things started in federal court.)

Defendant argued that the case was not commenced within two years of plaintiff’s alleged injury (and awareness thereof), so the case was time barred on its face.  Even though both Fed. R. Civ. P. 3 and the equivalent Alabama rule say that “A civil action is commenced by filing a complaint with the court,” the substantive Alabama law on statute of limitations law requires looking at least a little past the filing date.  “For statute-of-limitations purposes, the complaint must be filed and there must also exist ‘a bona fide intent to have it immediately served.’” Id. (citations omitted).  Plaintiff’s note about “withholding service of process” was the opposite of intending to serve the complaint immediately.  So, plaintiff had not commenced her case in time and the dismissal was affirmed by the Eleventh Circuit.

Does this help answer the preceding ponderous questions about the timing of gifting?  Maybe.  Does this remind defense lawyers to check if filings purportedly made in the nick-of-time did not really commence an action before the expiration of the statute of limitations?  It should.  The applicable statute of limitations law may not be as clear as Alabama’s was in rejecting a mere placeholder complaint, but it is worth a look in your cases.

This post comes from the Cozen O’Connor side of the blog.

After two months, the third bellwether trial in the Pinnacle Hip Implant MDL is coming to an end. The jury heard closing arguments yesterday and began deliberating late in the afternoon. They start up again this morning.

Much like the second bellwether trial, this trial was not without controversy. The signs were ominous before it began.  Two weeks before trial, the court issued a sua sponte order consolidating six separate plaintiffs for the trial, close to any defendant’s worst nightmare. The court also ruled that plaintiffs could serve notices that would require company witnesses who were outside the geographic reach of the court to nonetheless testify live via satellite. Defendants could not substitute trial depositions for the satellite testimony, even though trial depositions had already been taken, complete with cross-examination of the witnesses by plaintiffs’ counsel. This order was sufficiently controversial that a Fifth Circuit judge, while concurring with his colleagues’ decision to reject defendants’ writ of mandamus challenging the order, chose to issue a one-sentence concurring opinion saying that the MDL judge got it wrong.

Continue Reading Buckle Up: The Jury Is Out in the Pinnacle Hip Implant MDL’s Third Bellwether Trial

Many years ago, we represented a client in a quandary.  (We know, we know: that’s pretty much always the case.)  The product had been sold for many decades, the early history was important in marshalling a defense, and there were no employees around who were percipient witnesses.  What was the solution?  We made an employee an expert on the history of the product.  Voila!  The good part of that approach is that the witness would be free to talk about product issues predating his involvement (or, indeed, his birth).  The bad part was that much of the preparation work with the now-expert might no longer be shielded by the attorney-client privilege.

Federal Rule of Civil Procedure 26(a)(2) addresses that odd creature of the expert witness who was not retained or specially employed to provide expert testimony.  Think of, as in the instance mentioned above, a company employee whose job is mostly not devoted to rendering expert testimony.  Or think of treating physicians.  Rule 26(a)(2)(B) provides that an expert witness must provide an expert report “if the witness is one retained or specially employed to provide expert testimony in the case or one whose duties as the party’s employee regularly involve giving expert testimony.”  By contrast, Rule 26(a)(2)(C) provides that for witnesses who are not required to provide a written report – i.e., those not included in Rule 26(a)(2)(B) – the proffering party need only disclose the subject matter of testimony and “a summary of the facts and opinions to which the witness is expected to testify.”  We all know that treating physicians do not need to provide expert reports.  We couldn’t make them do it.  We probably could make employee/experts do a report, but under Rule 26(a)(2)(B), we don’t need to do that.  But to what extent does the attorney-client privilege shield our prep work with that employee/expert under that rule?

Continue Reading Attorney-Client Privilege Held Not to Apply to Nonreporting Employee/Expert

People supplement a lot of things. You can supplement your diet with a multivitamin. You can supplement your income with a part-time side job. On the DDL Blog, we are always supplementing our scorecards and cheat sheets. Generally speaking, supplement is a pretty common word and has a fairly universally accepted definition. A supplement is an add-on. Something you do to make something more complete. Does the food you eat contain vitamins and minerals? Sure. But that multivitamin adds to it. It’s a boost.

In litigation too, we do a lot of supplementing. In fact, we are required to do so. Federal Rule 26(e) requires a party to supplement its discovery responses if it “learns that in some material respect the disclosure or response is incomplete or incorrect.” This duty to supplement extends to expert reports as well. Fed.R.Civ.P. 26(e)(2). But what does it mean to “supplement” an expert report? And when does supplementing to make a correction or completion go too far?

Plaintiffs got the answer to that question in U.S. ex. rel. Brown v. Celgene Corp., 2016 U.S. Dist. LEXIS 156826 (C.D. Cal. Aug. 23, 2016). Plaintiff-Relators brought a False Claims Act and Medicare Anti-Kickback Statute case against defendant alleging it illegally marketed Thalomid and Revlimid off-label and paid kick-backs to physicians for prescribing off-label. Id. at *6. The court set a deadline for the expert reports and relators timely served a report from their damages expert. Shortly thereafter, however, relators sought leave to supplement that expert report based on late produced Medicare data. Id. at *6-8. Relators wanted to time to analyze the data and supplement the report with that analysis. Relators also represented that while the supplement would be based on new data, the opinions were not expected to differ significantly. Id. at *8. The court granted the leave requested. Defendant was likewise given an opportunity to amend its expert reports in rebuttal and relators’ expert was deposed after his supplemental report was served. Id. at *11.

Continue Reading Plaintiffs Learn Supplementing Isn’t a Second Bite at the Apple

A lot of companies rely on retired and otherwise former employees for information in litigation – including product liability litigation. Particularly where a product (such as a drug that’s now gone generic) has a long history, they are often the best source of knowledge about what happened years ago.  In dealing with ex-employees, however, defendants must keep in mind that, for purposes of the attorney/client privilege, discussions with ex-employees are subject to being treated much differently (and less protectively) than corporate communications with current employees.

The recent case, Newman v. Highland School District No. 203, 381 P.3d 1188 (Wash. 2016), although not involving prescription medical products, or even product liability, is a cautionary tale.  The defendant in Newman was a governmental entity, a school district.  The plaintiff alleged that he suffered a brain injury playing high school football, and that the injury occurred because the plaintiff was allegedly allowed to play in a game the day after suffering a concussion in practice.

The plaintiff in Newman didn’t sue until some three years after the injury. Id. at 1189-90.  By then, most of the coaching staff had turned over, and the individuals with the best knowledge of what had happened were employed elsewhere.  The school district’s litigation counsel contacted the ex-coaches and when they were deposed, claimed to represent them.  Id. at 1190.  Plaintiff challenged that representation as a conflict of interest and “sought discovery concerning communications between [the defendant] and the former coaches.”  Id.  The defendant resisted discovery with a claim of attorney/client privilege, and plaintiff opposed.  The defendant lost, and appealed denial of its motion for a protective order.  Id.

Continue Reading A Reminder To Be Careful With Ex-Employees And Confidential Information