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We reported about a year and a half ago on a Ninth Circuit opinion holding that the First Amendment prohibited cancer warnings required by California’s Proposition 65 because the warnings were government-compelled speech.  Because there was no scientific consensus that the product at issue (glyphosate) causes cancer, the compelled warning failed intermediate scrutiny and thus violated the Constitution.  You know about Prop 65.  It is the voter-enacted law that requires businesses to warn Californians about significant exposures to chemicals that allegedly cause cancer or birth defects.  See Cal. H&S Code § 25249.5 et seq.  The result is that California is now blanketed with boilerplate warnings of chemicals “known to the state” to cause cancer that literally no one pays any attention to. 

This was not the first time the Ninth Circuit ruled that the First Amendment trumps Prop 65.  You might recall the court order circa 2018 requiring Starbucks and other coffee shops to warn California consumers that drinking coffee poses a risk of cancer because it contains dietary acrylamide.  The problem with that warning is that it is not true.  Dietary acrylamide forms naturally in many foods when prepared at high temperatures, and epidemiological studies are inconclusive on whether it is carcinogenic.  One epidemiologist who reviewed the literature has concluded there are no studies showing that eating food with acrylamide increases the risk of cancer at all. 

The California Chamber of Commerce thus stepped in and sued to enjoin the State from compelling businesses to disparage their own products with alarmist warnings that have no factual support.  Long story short, the Chamber won, and the Ninth Circuit affirmed a preliminary injunction preventing the State from enforcing Prop 65.  See our post on the opinion here. 

So we have the Ninth Circuit holding that unsupported Prop 65 cancer warnings violate the First Amendment.  Twice.  Including in a case specifically involving dietary acrylamide.  And what then did the great State of California do?

It doubled down. 

Instead of turning its attention to matters that might actually harm Californians, the State promulgated a new regulation effective January 1, 2025, specifically requiring a Prop 65 cancer warning for dietary acrylamide. 

And the State lost again.  On remand from the Ninth Circuit, the district court has now permanently enjoined the State from enforcing its new regulation.  In California Chamber of Commerce v. Bonta, No. 2:19-cv-02019, 2025 U.S. Dist. LEXIS 84289 (E.D. Cal. May 2, 2025), the district court explained that the carcinogenic risk of dietary acrylamide has been the subject of debate since its discovery in 2002.  The court acknowledged animal studies showing that mice and rats develop tumors when they eat food containing acrylamide.  But, “as [the] court has previously acknowledged, the implications of these animal studies and mechanistic data for assessing dietary acrylamide’s cancer risk are uncertain.”  Id. at *9-*11 (emphasis in original).  The FDA stated in 2024 that it is “not clear exactly what risk acrylamide poses to humans,” and as noted above, epidemiological studies have been inconclusive.  Id. at *12-*14. 

The district court first rejected the State’s argument that the Chamber failed to show that any of its members were compelled to provide a warning because it did not provide evidence that their food products contain acrylamide.  That was beside the point.  Businesses in California are under “constant, credible threat of enforcement” of Prop 65 because the statute makes it “absurdly easy” to bring a private action.  A private plaintiff “need only credibly allege that a product has some of the chemical at issue, not that the amount . . . is harmful or exceeds [the designated] level.”  Id. at *22-*24.  The Chamber also provided evidence of hundreds of private enforcement actions alleging the presence of acrylamide, which shows how Prop 65 really works.  Id at *25.  The Chamber and its members definitely had standing. 

On the merits, the district court ruled that the State’s new regulation was unconstitutional under Supreme Court precedent on the First Amendment—Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (1985), and Central Hudson Gas & Electric Corp. v. Public Service Commission, 447 U.S. 557 (1980).  Under the less-stringent Zauderer test, the government can compel speech so long as it is reasonably related to a substantial governmental interest and the compelled speech is (1) purely factual, (2) noncontroversial, and (3) not unjustified or unduly burdensome.  The district court found that the Prop 65 warnings were “neither uncontroversial nor purely factual as the warnings espouse a one-sided view that dietary acrylamide poses a human cancer risk despite a lack of scientific consensus on that point.”  Id. at *28.  The State argued that its newly formulated acrylamide warning strung together statements that were factually true.  But the State was ignoring “the reality that [the warning] conveys the ‘core message’ that consumer a food containing acrylamide poses a risk of cancer.”  Id. at *36-*37. 

The new regulation failed under Central Hudson, too.  Under Central Hudson’s intermediate scrutiny standard, the Prop 65 dietary acrylamide warning must “directly advance the governmental interest asserted and must not be more extensive than is necessary to serve that interest.”  Id. at *41.  California clearly has an interest in protecting the public from health hazards.  “However, misleading statements about acrylamide’s carcinogenicity do not directly advance that interest.”  Id. at *42.  Moreover, California has other means available to inform consumers of its opinion that acrylamide in food can cause cancer without burdening the free speech of businesses, including advertising and posting information on the Internet. 

The district court therefore granted the Chamber’s request for declaratory relief and a permanent injunction against enforcement of the Prop 65 acrylamide regulation.  The State may or may not appeal.  Or maybe a private enforcement organization (i.e., the plaintiffs’ bar) will intervene and appeal, which is what happened last time.  We don’t know why the State doubled down on its unsupported and anything-but-noncontroversial acrylamide Prop 65 warning.  But being the defense hacks that we are, we can’t help but see the influence of private enforcers trying to protect a profit center.  Part of us would like to see another appeal, and a third opinion from the Ninth Circuit holding that the First Amendment trumps Prop 65. 

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MDLs are supposed to follow the Federal Rules of Civil Procedure.  That’s the reminder the Sixth Circuit gave in In re National Prescription Opiate Litigation, 956 F.3d 838, 844 (6th Cir. 2020):

[T]he law governs an MDL court’s decisions just as it does a court’s decisions in any other case. . . .  Here, the relevant law takes the form of the Federal Rules of Civil Procedure.  Promulgated pursuant to the Rules Enabling Act, those Rules are binding upon court and parties alike, with fully the force of law. . . .  Respectfully, the district court’s mistake was to think it had authority to disregard the Rules’ requirements . . . in favor of enhancing the efficiency of the MDL as a whole. . . .  But MDLs are not some kind of judicial border country, where the rules are few and the law rarely makes an appearance.  For neither §1407 nor Rule 1 remotely suggests that, whereas the Rules are law in individual cases, they are merely hortatory in MDL ones.

Id. at  844 (citations omitted).  More recently the Civil Rules Committee made the same point in approving new Fed. R. Civ. P. 16.1:  “The Rules of Civil Procedure, including the pleading rules, continue to apply in all MDL proceedings.”  Comment to Rule 16.1(b)(3)(A).

Bad things happen – usually to defendants – when an MDL adopts practices designed to cut procedural corners that the drafters of the rules put there for a reason.

Continue Reading MDL Procedural Shortcuts Once Again Disadvantage Defendants
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When we read the word “Georgia”, we hear it in our heads sung in the voice of the great Ray Charles.  Actually, we hear the entirety of the opening lyrics to Georgia on My Mind.  Is that just us?  Ok, well, anyhoo.

We have been reading a lot about Georgia of late because of last month’s enactment of tort reform, in the form of Georgia Senate Bill 68 (a no-name Act) and Georgia Senate Bill 69 (the “Georgia Courts Access and Consumer Protection Act”), signed by Georgia’s Governor on April 21, 2025.  There is a lot for a medical device and pharmaceutical product liability lawyer to like.

The civil litigation procedural changes wrought by these bills include:

  • Trifurcation of Liability and Damages:  Senate Bill 68, Section 8 took effect with the Governor’s signature and applies to pending actions.  It added O.C.G.A. § 51-12-15, which allows any party in an action for bodily injury or wrongful death with more than $150,000 at issue to demand furcation of liability and damages.  The initial, liability phase includes apportionment of fault, if any.  The second phase, if necessary, goes to the same judge and jury, and determines compensatory damages.  Then a third phase (again to the same judge and jury), if necessary, determines issues like punitive damages, attorneys’ fees, or costs that may be at issue. 
  • Non-economic damages:  Senate Bill 68, Section 1 replaced O.C.G.A. § 9-10-184, which now prohibits counsel from putting a number on non-economic damages until “after the close of evidence and at the time of [plaintiff’s] first opportunity to argue the issue of damages.”  In addition, the non-economic damage request must be “rationally related to the evidence of noneconomic damages.”  This one also took immediate effect and applies to pending actions.
  • Recoverable medical expenses:  Senate Bill 68, Section 7 added O.C.G.A. § 51-12-1.1. For causes of action arising on or after April 21, 2025, this section  limits recoverable damages for “medical and healthcare expenses” to their “reasonable value,” which is to be determined with reference to the amount paid for those services, not just the amount billed. 
  • Discovery about litigation-related medical care: Newly-added O.C.G.A. § 51-12-1.1 also makes “relevant and discoverable” information about whether medical care has been provided under a “letter of protection” or other arrangement where payment to the provider will be made out of a judgment or settlement.  The relevant and discoverable information includes who referred the plaintiff to that provider and the terms of that agreement, as well as information about any sale of the resulting accounts receivable.  This provision only applies to “causes of action arising on or after the effective date of the Act”, namely April 21, 2025.
  • Discovery of litigation financing agreements:  Senate Bill 69, Section 4 amended O.C.G.A. § 9-11-26 to add a new provision making discoverable “the existence and terms and conditions of any litigation financing agreement” for more than $25,000.  Mere disclosure of a litigation funding agreement does not make that agreement admissible at trial…but at the same time, the subsection is not to be construed “to limit the admissibility of such information as evidence of a party’s claim or defense.”  This section became effective upon the Governor’s approval, but only applies to “causes of action commenced” or litigation funding “contracts entered into” on or after April 21, 2025.

The Georgia Courts Access and Consumer Protection Act contains even more important new laws, as it imposes substantial and comprehensive regulation of third-party litigation funding/financing in the form of the newly-created O.C.G.A. Title 7, Chapter 10, mostly effective as of January 1, 2026.

First up are the definitions, including what litigation financing is: 

‘Litigation financing agreement’ or ‘litigation financing’ means an agreement in which a litigation financier agrees to provide financing to a consumer or entity that is or has standing to become a party to a civil action, administrative proceeding, legal claim, or other legal proceeding seeking to recover monetary damages, or to counsel for such consumer or entity, in exchange for a right to receive payment, which right is contingent in any respect on the outcome of such action, claim, or proceedings by settlement, judgment, or otherwise, or on the outcome of any matter within a portfolio that includes such action, claim, or proceedings and involves the same legal representative or affiliated representative.

O.C.G.A. § 7-10-1(10)(A).

Next, O.C.G.A. § 7-10-2 requires any person “engage[d]in litigation financing in [Georgia]” to register as a “litigation financier”.  If an entity is engaged in litigation funding, it must disclose “each person that directly or indirectly owns, controls, holds with the power to vote, or holds proxies representing 10 percent or more of the voting shares” of the entity, including identifying information and whether such persons have any criminal convictions within the past 10 years for anything other than a misdemeanor traffic violation.  Litigation financiers cannot be registered if they are associated with foreign governments, entities, or persons designated by the United States as foreign adversaries.  Then O.C.G.A. § 7-10-9 makes violation of these registration requirements a felony punishable by up to 5 years in prison and/or a $10,000 fine.  That is a requirement with some teeth!

More of the real substance comes in O.C.G.A. § 7-10-4, which explains what a litigation financier “shall not” do—including exercise control over the proceedings or any settlement, or obtain payment greater than what the plaintiff recovers after fees and costs:

A litigation financier shall not:

(1) Direct, or make any decisions with respect to, the course of any civil action, administrative proceeding, legal claim, or other legal proceeding for which such litigation financier has provided litigation financing, or any settlement or other disposition thereof

* * *

(2) Contract for, receive, or recover, whether directly or indirectly, any amount greater than an amount equal to the share of the proceeds collectively recovered by the plaintiffs or claimants in a civil action, administrative proceeding, legal claim, or other legal proceeding seeking to recover monetary damages financed by a litigation financing agreement after the payment of any attorney’s fees and costs owed in connection to such action, claim, or proceedings.

Other limitations in the Georgia Courts Access and Consumer Protection Act include prohibitions on litigation financiers paying or accepting referral fees, engaging in false advertising, or seeking or obtaining waivers of remedies from those using their litigation financing services. 

Still other provisions preclude litigation financiers from requiring consumers of their services to use specific providers of goods and services (such as, for example, particular plaintiff’s lawyers that the litigation financier prefers); prevent those involved in the litigation (like the plaintiff’s lawyers) from having a financial interest in the litigation financier; and preclude the assignment or securitization of most litigation financing agreements, among other restrictions.

Litigation financing agreements in Georgia also will require specific disclosures in 14 point bold type:

IMPORTANT DISCLOSURES — PLEASE READ CAREFULLY 

1. Right to Cancellation: You, the consumer, or your legal representative may cancel this litigation financing agreement without penalty or further obligation within five (5) business days from the date you sign this contract or the date you receive financing from the litigation financier, whichever date is later. You or your legal representative may cancel this litigation financing agreement by sending a notice of cancellation to the litigation financier and returning to the litigation financier any funds received from the litigation financier at the litigation financier’s preferred mailing address set forth on page 1 of this contract.

2. The maximum amount the litigation financier may receive or recover from any contingent payment provided for in this litigation financing agreement shall be no more than an amount equal to the share of the proceeds collectively recovered by the plaintiffs or claimants in a civil action, administrative proceeding, legal claim,or other legal proceeding seeking to recover monetary damages financed by this litigation financing agreement after the payment of any attorney’s fees and costs owed in connection to such action, claim, or proceedings.

3. The litigation financier agrees that it has no right to, and will not demand, request, receive, or exercise any right to, influence, affect, or otherwise make any decision in the handling, conduct, administration, litigation, settlement, or resolution of your civil action, administrative proceeding, legal claim, other legal proceeding. All of these rights remain solely with you and your legal representative.

4. You, the consumer, are not required by the terms of this litigation financing agreement to continue to be represented by any particular legal representative, and the litigation financing agreement does not include any right for the litigation financier, any legal representative, or any other person to claim or seek to recover any assessment, charge, fee, penalty, or damages of any kind if you elect to change legal representatives at any time.

5. If there is no recovery of any money from your civil action, administrative proceeding, legal claim, or other legal proceeding, or if there is not enough money to satisfy in full the portion assigned to the litigation financier, you will not owe anything in excess of your recovery.

6. You are entitled to a fully completed litigation financing contract with no material terms or conditions omitted prior to signing. Before signing the litigation financing contract, or authorizing anyone to sign it on your behalf, you should read the contract completely and consult an attorney.

O.C.G.A. § 7-10-6

But that’s not all:  O.C.G.A. § 7-10-5 puts litigation financiers providing more than $25,000 in funding on the hook for any costs or monetary sanctions for frivolous litigation, and requires litigation financiers to indemnify funded plaintiffs and claimants for “any adverse costs, attorney’s fees, damages, or sanctions that may be ordered or awarded against such persons in such action.” Again, this new law has some teeth!

Litigation funding, particularly in personal injury matters, gets talked about some, but action is harder to come by. For example, the Advisory Committee on Civil Rules (to the Judicial Conference’s Committee on Rules of Practice and Procedure) has been contemplating whether some litigation funding measure is needed at the federal level, and if so, whether a new federal rule of civil procedure requiring disclosure of litigation funding is the right solution. (See, for example, the Committee’s October 2024 Agenda Book at 417-83, and correspondence from LCJ and the U.S. Chamber in support of such a federal rule.)

Georgia’s two pronged approach (regulation of litigation funders and litigation funding contracts, and disclosure in the form of the new O.C.G.A. § 9-11-26, which allows for discovery into litigation funding) obviously goes further than the disclosure-only solutions usually proposed. Indeed, because the regulatory aspects of the new Georgia law apply to anyone in Georgia engaged in litigation funding and any litigation funding contracts in Georgia, those regulatory provisions will apply regardless of whether a case is pending in state or federal court in Georgia.

All in all, some big changes, and the third party litigation funding provisions put Georgia out in the lead on this issue.

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Prologue: Many years ago, our litigation practice included representation of a couple of film studios.  While it was fun to visit backlots and (literally) bump into movie stars, we discovered that discovery, research, and motion practice were not necessarily any more exciting due to involvement of above-the-line talent. Contract law is still contract law, even if the contract was written on a napkin and bears the signature of an Oscar winner.  

Now we go to an iris shot of palm trees swaying in front of a courthouse. 

There is nothing dull about the recent case of Sexton v. Apple Studios LLC, 110 Cal. App. 5th 183, 2025 Cal. App. LEXIS 205 (March 28, 2025). In fact, it is boffo box office bait. The case features a “that guy” actor — someone you’ve seen in many fine shows and movies (e.g., Deadwood, Justified). Appearing as co-stars are Covid-19 vaccine politics and application of an anti-SLAPP (strategic litigation against public participation) statute. 

Go to a close up of the plaintiff, the actor Brent Sexton.  His IMDB page is undeniably impressive. He was conditionally cast for the role of President Andrew Johnson in a television series based on James Swanson’s excellent book, Manhunt: The 12 Day Chase for Lincoln’s Killer (listeners of the “Advisory Opinions” legal podcast might recall that Manhunt was a book club selection.) Part of the condition was that the actor needed to be vaccinated against Covid-19. 

Filming of Manhunt was scheduled to commence in 2022.  At that time, concerns over transmission of the COVID-19 virus were high.  The film studio, relying on the then medical consensus, selected mandatory vaccination to promote safety on the Manhunt set. The studio decided that masking, periodic testing, and social distancing would be insufficient because actors and crew must operate in close quarters, actors could not wear masks in the historical production, lags made testing unworkable, vaccination reduced the threat of COVID-19 infections, many of the actors and other workers were at a higher risk of Covid-19 complications on account of age or pre-existing conditions, filming would take place in a location (Georgia)  with less restrictive Covid-19 measures, meaning there was an increased off-set risk of exposure, and mandatory vaccinations reduced the risk of production disruptions

The actor sought a medical exemption from the vaccine requirement, based on his history of blood clotting from thrombocytopenia and deep vein thrombosis. The studio considered the exemption request, but ultimately rejected it and, as they say in the biz, went in a different direction.  Sexton did not get the role, which would have earned him over a half a million dollars. He sued the studio for invasion of privacy, disability discrimination, failure to accommodate, and failure to engage in an interactive process. 

The studio filed a motion under the Anti-SLAPP statute. Do you remember how Anti-SLAPP statutes work?  California’s anti-SLAPP law (Civil Procedure Section 425.16) was designed to protect parties from strategic lawsuits filed to silence critics or intimidate those exercising their right to speak freely or petition the government. The law applies to lawsuits stemming from “any act… in furtherance of the person’s right of petition or free speech under the United States Constitution or the California Constitution in connection with a public issue.”  The law allows defendants (which can include businesses) to strike such lawsuits early in litigation.  Does that statute make sense in the context of an actor suing over not getting a part in a tv show?

The trial court denied the studio’s Anti-SLAPP motion, and the studio took the issue up on appeal.  The appellate court reversed and dismissed the case.  Why?

There are two prongs to the Anti-SLAPP analysis.  First, is the lawsuit directed against a “protected activity” that is freighted with First Amendment significance?  Second, if the defendant-movant met the first prong, can the plaintiff carry the burden of showing claims with at least minimal merit? The trial court concluded that the studio satisfied prong one because casting someone in an important on-screen role was an act that “shaped its television show’s editorial direction.”  But the trial court ruled against the studio on prong two, reasoning that the studio’s interest in vaccination was not “compelling” and the actor’s privacy claim had at least minimal merit. The trial court did not strike the lawsuit. The appeal followed. 

The appellate court agreed with the trial court that the studio successfully invoked the First Amendment over the casting decision. The challenged activity was creative, not just logistical, and involved the studio’s stance on COVID vaccination, a contentious public issue, and its presentation of a controversial historic figure, President Andrew Johnson.  (The court supplies a surprisingly comprehensive and nuanced discussion of President Johnson’s troubled legacy.)

Logistical arrangements and decisions were part of the studio’s creative endeavor and affected how the studio chose to speak and what it had to say. The court held that the anti-SLAPP statute covers significant media decisions about who will perform important roles for a wide public audience. It is interesting in itself that personnel decisions about on-screen mass media presentations about public issues are First Amendment protected.  

Where the appellate court parted company with the trial court was on prong two. The plaintiff’s claims were going nowhere. The complaint lacked even “minimal merit.”  The studio was operating under COVID safety rules negotiated with relevant unions, which included mandatory vaccination for all actors working on sets.  The studio’s science advisors agreed.  

The court took judicial notice of relevant CDC vaccination findings.The court also discussed the valid concern over vaccine “free riding.”   In short, the defendant reasonably relied on CDC vaccination recommendations.  There was no basis for the court to apply strict scrutiny. Accordingly, the case boiled down to reasonableness. 

The plaintiff’s privacy claim failed because there was no reasonable expectation of privacy under the circumstances.  Refusal to vaccinate for an acting job does not implicate privacy.  Employers determine workplace safety rules, including vaccination. Here, the studio’s rules were reasonable under the circumstances. Requiring vaccinations in group work settings is old hat, and the studio was following the suggestions of public health authorities. (The plaintiff submitted an expert opinion calling Covid vaccines bunk, but the opinion had no sound basis that would give it any value under Sargon.)

The plaintiff’s refusal to vaccinate made him unqualified for the job, because he could not safely do it.  The plaintiff could not authentically play a role in a movie as President Andrew Johnson while wearing a mask. That would be a crazy “accommodation.” His discrimination claim thus was not viable.  

The plaintiff’s claim that the studio failed to engage in an interactive process — whatever that means — failed because … the studio did engage. It considered the exemption request and it considered possible accommodations. It then arrived at a reasonable decision in favor of vaccination. According to the appellate court, the actor’s “position boils down to his claim that he had a right to impose a potentially deadly risk on coworkers so that he could act in Manhunt.  No precedent supports this claim.”  

In what can be described only as an happy ending for the film studio, the trial court’s order was reversed, the lawsuit was dismissed under SLAPP, and the plaintiff was ordered to pay the defendant’s fees and costs.

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Science and law share a common goal—getting at the truth; but their relationship can be shaky.  In areas like medicine and products liability, courts need to rely on science, but courts should not make science or get ahead of science.  Science is a methodical process that relies on testing, peer review, and replication. When science remains unproven, it needs to remain out of the legal system.  Prematurely adopting scientific findings into legal standards—before they have been thoroughly validated—can lead to institutionalizing unverified science and the creation of legal precedents that are difficult to overturn. Science has to lead and the law has to follow.  We have written about the consequences of the reverse.  Today, we talk about a case that put things in the right order.

Plaintiff in Davey v. Safeway Inc., 2025 Cal. Super. LEXIS 5572 (May 5, 2025), ingested over-the-counter acetaminophen while pregnant with her son.  Her son was later diagnosed with autism spectrum disorder (ASD) which plaintiff blames on the prenatal exposure to acetaminophen.  The drug’s label included an FDA-required warning that: “if pregnant or breast-feeding, ask a health professional before use.”  Plaintiff brought warning, negligence, and implied warranty claims alleging that defendants should have included a warning that “prenatal ingestion of acetaminophen may cause ASD.”  Id. at *1-2.  But there was no science to support that warning at the time of plaintiff’s ingestion, and there remains none today. 

The court summarized the issue:

This case raises the question of when a duty to warn of a specific health concern arises – above and beyond a general warning to discuss the matter with a medical professional — where the underlying science relating to the concern was (and remains) highly uncertain despite ongoing and extensive review by government regulators and independent medical entities alike.

Id. at *1.  The answer is there is no such duty.

The case thoroughly sets out the “state of the science,” which not surprisingly was described differently by the parties.  But rather than try to resolve those differences, the court looked to “a series of literature reviews conducted by federal regulators and independent medical entities.”  Id. at *10.  The upshot of which was that the available scientific evidence regarding the potential relationship between acetaminophen and ASD was “too limited to make any recommendations and did not warrant any changes to the FDA’s [required warning].”  Id. at *11.  As recently as 2023, the FDA’s continued review of the evolving science found that the “outcomes remain mixed” and do not alter its prior conclusions.  Id. at *17-18.

Under California law, a drug manufacturer is required to warn about “known or reasonably scientifically knowable dangerous propensities of its product.”  Id. at *24.  The concept of what is a knowable risk is inherently tied to the state of the science:

Consequently, “[t]he strength of the causal link . . . is relevant both to the issue of whether a warning should be given at all, and, if one is required, what form it should take.”   

Id. at *26 (quoting Finn v. G.D. Searle & Co., 35 Cal.3d 691, 701 (Ca. Sup. Ct. 1984). 

Both the FDA and courts recognize that over-warning poses its own risks.  It can lead to dilution of important warnings, consumer disregard, or could dissuade a consumer from using a needed product. 

Based on the state of the science, which was “profoundly uncertain and conflicting,” the court concluded as a matter of law that the “existence of any causal link [between acetaminophen and ASD] was neither known or scientifically knowable.”  Id. at *28.

The court was not persuaded that internal company analyses that included some “expressions of concern,” changed the legal conclusion:

That a company that makes pharmaceuticals regularly reviews the literature potentially relevant to the safety of its products and supports candid internal discussion, however, is positive corporate behavior.  While these discussions show awareness of the science, they do not change the state of that science.

Id. at *28-29.  And the state of the science warranted summary judgment.

We will acknowledge that there is another ruling in this opinion—rejecting defendants’ preemption defense.  But we are not going to talk about that because the case reached the right conclusion anyway.  And, with the court’s heavy reliance on the FDA’s review of the literature, the state of the science functions essentially the same as a preemption ruling that no “newly acquired information” existed to support a label change.   

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In a series of what we entitled “reports from the front,” we discussed how the federal government asserted, and eventually won, the right to intervene in ongoing False Claims Act suits to seek their dismissal notwithstanding the objections of the “relators” who were ostensibly pursuing these actions in the government’s name.  Basically, the relators claimed that, unless the government exercised its initial right to take over an FCA suit early on, the government lost all control over the relators, and they could essentially run wild using the government’s name.  The Supreme Court rightfully rejected that view.  United States ex rel. Polansky v. Executive Health Resources, Inc., 599 U.S. 419, 437-38 (2023) (government entitled to intervene and obtain dismissal of FCA action at any time on the basis of any “reasonable argument” regardless of the relator’s position).

However, three justices had more to add – they challenged that entire FCA private-attorney-general system as unconstitutional.  Justice Thomas stated in dissent:

The FCA’s qui tam provisions have long inhabited something of a constitutional twilight zone.  There are substantial arguments that the qui tam device is inconsistent with Article II and that private relators may not represent the interests of the United States in litigation. . . .  [T]he Court has held that conducting civil litigation for vindicating public rights of the United States is an executive function that may be discharged only by persons who are Officers of the United States under the Appointments Clause.  A private relator under the FCA, however, is not appointed as an officer of the United States under Article II.  It thus appears to follow that Congress cannot authorize a private relator to wield executive authority to represent the United States’ interests in civil litigation.  The potential inconsistency of qui tam suits with Article II has been noticed for decades.

Polansky, 599 U.S. at 449-50 (Thomas, J., dissenting) (citations and quotation marks omitted).  Concurring Justices Kavanaugh and Barrett agreed.  “I add only that I agree with Justice Thomas that “[t]here are substantial arguments that the qui tam device is inconsistent with Article II and that private relators may not represent the interests of the United States in litigation.”  Id. at 442 (concurring opinion).

Thus, we commented that “another front opens.”

Continue Reading FCA Frontal Assault in Eleventh Circuit
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Today’s post is a little different, in that it involves not an order, but a Motion for Relief from Judgment and to File an Amended Complaint (the “Motion”) filed by Pecos River Talc (“Plaintiff”) against Dr. Jacqueline Miriam Moline (“Dr. Moline”). Pecos River Talc LLC v. Moline, 3:23-cv-02990, Doc. No. 47-1 (D.N.J. Apr. 29, 2025).  Dr. Moline is a serial expert on behalf of plaintiffs in the cosmetic talcum powder litigation, and she was the lead author on a paper entitled “Mesothelioma Associated with the Use of Cosmetic Talc” (the “Article”).  The article was faked, as we originally discussed, here, in our “Stupid Expert Tricks Redux” post. That’s even clearer now, as the Motion we discuss here identifies bombshell, newly discovered evidence that undercuts the foundation of the Article and Dr. Moline’s opinions. This is a true “smoking gun.”

Continue Reading The Perils of Moline, Part II – Persistence Prevails in Re-Identifying Plaintiffs in Cosmetic Talc Article
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We really cannot say whether chicken by any other name would smell as sweet or even as chickeny.  While we do not compare ourselves to the Bard, we can say that cultivated chicken meat cannot be sold in Florida to allow any such olfactory comparison there.  The manufacturer of just such a product challenged the Florida law banning it in Upside Foods, Inc. v. Simpson, No. 4:24cv316-MW/MAF (N.D. Fla.).  The original complaint in Upside actually raised express preemption affirmatively, contending that the Florida law ran afoul—afowl?—of the federal Poultry Product Inspection Act (“PPIA”).  The court balked—bawked?—at that in denying plaintiff’s motion for summary judgment last fall, both on lack of standing and lack of likelihood of success on the merits.  2024 WL 5274483 (N.D. Fla. Oct. 11, 2024).  Following that decision, the plaintiff amended its complaint to assert claims under § 1983 and the court’s inherent equitable powers.  The defendants moved to dismiss, which resulted in a decision with a few nuggets that we think may have implications for the drug and device cases typically on our plate.  (We will stop with the pathetic poultry puns now.) [Note: this case now has a non-slip opinion citation, 2025 U.S. Dist. Lexis 85699].

Although the defendants did not challenge plaintiff’s standing to raise the claims in the amended complaint, the Upside court addressed standing sua sponte and found plaintiff had standing, in part because it “plausibly alleged that it would be subject to a ‘real and immediate threat of criminal enforcement’ for arguably engaging in ‘solicitation’ to violate Florida’s cultivated meat ban.”  Slip op. at 6.  We will not say much about that issue given that we have discussed standing plenty in connection with a different animal and even a monster puppet.  Suffice it to say that there are various challenges to state laws and actions directed at FDA-approved drugs that are percolating through the courts where the plaintiffs’ claimed standing looks a lot like in Upside.

The next issue in Upside was like double preemption.  To challenge a state law as being preempted, the plaintiff has to have a “proper cause of action to proceed in federal court.”  Slip op. at 8.  Claims cannot be brought under § 1983 if they have been specifically foreclosed by statute or impliedly foreclosed “by creating a comprehensive enforcement scheme that is incompatible with individual enforcement.”  Id. at 9 (citation omitted).  That sounds similar to looking at express and implied preemption, and, sure enough, the PPIA does have a provision that vests the U.S. with sole authority to enforce the act or restrain violations of it.  Id. at 10-11.  Upside even cited Buckman’s interpretation of equivalent language in the FDCA as precluding causes of actions by private litigants.  So, § 1983 was unavailable to the plaintiff to assert that the PPIA preempted Florida’s ban on cultivated meat.

Buckman also got some air play in Upside’s analysis of whether a call to the court’s equitable powers could get around the statutory grant of exclusive authority to the U.S. to enforce the PPIA.  “Plaintiff cannot circumvent the congressional foreclosure of private enforcement of the PPIA by attempting to invoke this Court’s equitable powers.”  Id. at 13-14 (citation omitted).  We do not often see product liability plaintiffs asserting claims in equity to try to sidestep Buckman, but we would expect a similar result if they did.

Next, Upside analyzed whether the state law imposed any requirements on the plaintiff, a putative seller in Florida with USDA’s stamp of approval of its facility as a PPIA-compliant establishment in hand.  Much like tasting “food produced from cultured animal cells,” we will decline for now to dive right into the, well, meat of that analysis.  Basically, the court found that the Florida law did not impose any requirements that led to express preemption based on the PPIA. 

That was not the end of it, though, as plaintiff also asserted that the Florida ban violated the dormant Commerce Clause, on which we have also spilled some cyber-ink.  Although the Florida statute is facially neutral as to the location of any wannabe seller of cultivated meat, the plaintiff is based in California and, apparently, all manufacturers of cultivated meats are outside of Florida.  Those facts allowed the plaintiff to argue that the law “discriminates in effect against the out-of-state cultivated meat industry to the benefit [of] Florida’s conventional meat industry.”  Id. at 21.  If this reminds you of the winning argument in McDermott v. Wisconsin, 228 U.S. 115 (1913), then you might need a new hobby or you really like the Blog.  The plaintiff in Upside had the advantage that Florida officials had described the purpose of the ban as protecting Florida’s domestic conventional meat and agricultural producers.  At the motion to dismiss stage, the court had enough to let the dormant Commerce Clause claim survive.  Slip op. at 24-25.  For us, we continue to wonder if a challenge to a state law or action that limits the availability of a particular FDA regulated product, or class of FDA regulated products, could make similar use of the dormant Commerce Clause.  It is certainly plausible that all companies that make a certain targeted drug would be from somewhere other than the state that seeks to ban the use of the drug within its territorial limits.  However, there may not be a record of state officials supporting a discriminatory intent or an in-state market that would benefit from removing out of state competition.  Then again, there may be no downside to trying Upside to make the dormant Commerce Clause argument.

Photo of Lisa Baird

Today’s guest post comes from our Reed Smith colleague Jamie Lanphear on a topic near and dear to the Blog’s heart: The new EU Product Liability Directive. As always, our guest posters deserve 100% of the credit, and any blame, for their posts. But, also as usual, our guest posters deliver the goods, so we expect there will be none of the latter to be had. Take it away, Jamie.

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While the Blog previously covered the new EU Product Liability Directive (PLD), formally known as Directive (EU) 2024/2853 of the European Parliament and of the Council of 23 October 2024 on liability for defective products and repealing Council Directive 85/374/EEC (Nov. 18, 2024), the prior posts, which can be found here and here, discussed the PLD’s overhaul of product liability law. This post zeroes in on aspects of the Directive related to software, cybersecurity, and digital products.

Passage of the PLD marks a watershed moment for technology companies, software developers, and any business placing digital products on the European market, including medical device companies whose products include software functionality.

Software as a Product: A Paradigm Shift

One of the most significant changes in the new PLD is the explicit inclusion of software—whether embedded, stand-alone, or delivered as a service—within the definition of a “product”:

Products in the digital age can be tangible or intangible. Software, such as operating systems, firmware, computer programs, applications or AI systems, is increasingly common on the market and plays an increasingly important role for product safety. Software is capable of being placed on the market as a standalone product or can subsequently be integrated into other products as a component, and it is capable of causing damage through its execution. In the interest of legal certainty, it should be clarified in this Directive that software is a product for the purposes of applying no-fault liability, irrespective of the mode of its supply or usage, and therefore irrespective of whether the software is stored on a device, accessed through a communication network or cloud technologies, or supplied through a software-as-a-service model. (Emphasis added)

This means that software, firmware, applications, AI systems, and even digital manufacturing files are now subject to the same strict liability regime as traditional physical goods. The Directive also covers integrated and interconnected digital services, such as “a health monitoring service that relies on a physical product’s sensors to track the user’s physical activity or health metrics.”

This expanded scope is intended to reflect the reality that software is now integral to product safety and performance. For companies, this means that, after the date the PLD goes into effect (December 9, 2026) any defect in software, potentially including vulnerabilities or failures in digital services, may trigger liability under in the EU, if it leads to harm.

Cybersecurity Vulnerabilities as Product Defects

The PLD’s new approach to cybersecurity is closely intertwined with the EU’s broader regulatory framework for digital product security. One important piece of legislation in this area is the EU Cyber Resilience Act (CRA), which, together with the NIS2 Directive and sector-specific rules, sets out mandatory cybersecurity requirements for a wide range of digital products and services.

• Mandatory Security Requirements as a Benchmark Defect: Under the new PLD, non-compliance with “safety-relevant cybersecurity requirements” can form the basis of product defectiveness. For example, the CRA requires manufacturers to implement security-by-design, conduct risk assessments, provide security updates, and ensure secure default configurations for products with digital elements. If a company fails to meet these requirements, and a vulnerability leads to harm, non-compliance with the CRA may, in turn, be used to establish defectiveness under the PLD.

• Failure to Provide Security Updates: Both the PLD and the CRA impose ongoing obligations to provide software security updates throughout a product’s lifecycle. Under the PLD, a product is defective if the manufacturer fails to supply necessary updates or patches to address vulnerabilities, providing such updates are within the manufacturer’s control. The CRA similarly requires manufacturers to monitor for vulnerabilities and issue timely updates. If a cyberattack exploits an unpatched vulnerability and causes injury or property damage, the failure to update may provide the basis for strict liability under the PLD.

• Disclosure and Incident Response: The NIS2 Directive and the CRA require companies to have processes for vulnerability management, coordinated disclosure, and incident reporting. The PLD’s new rules on evidence and presumptions mean that if a company cannot demonstrate compliance with these processes, courts may presume defectiveness or causation in favor of the claimant under the PLD—especially in technically complex cases, as we discussed previously

Burden of Proof and Disclosure: Lowering the Bar for Claimants

The new directive also introduces procedural changes intended to make it easier for claimants to bring and succeed in product liability claims, including those involving software and cybersecurity:

• Rebuttable Presumptions: If a claimant faces “excessive difficulties” in proving defectiveness or causation due to technical or scientific complexity (as is often the case with software or AI), courts can presume defectiveness and/or causation if the claimant can show it is likely that the product was defective or that there is a causal link.

Or, in the words of the PLD: “National courts should presume the defectiveness of a product or the causal link between the damage and the defectiveness, or both, where, notwithstanding the defendant’s disclosure of information, it would be excessively difficulty for the claimant, in particular due to the technical or scientific complexity of the case, to prove the effectiveness of the causal link, or both.”

Notably, the Directive instructs courts, when evaluating technical or scientific complexity, to consider certain factors, including “the complex nature of the product, such as an innovative medical device; the complex nature of the technology used, such as machine learning; the complex nature of the information and data to be analysed by the claimant; and the complex nature of the causal link.”

• Disclosure of Evidence: Courts can require companies to disclose relevant evidence in their possession if the claimant makes a plausible case. Additionally, courts may also require that evidence be presented in an easily accessible and easily understandable manner.” The Directive explicitly calls out digital products as those embodying the sort of complexity envisioned: “Taking into consideration the complexity of certain types of evidence, for example evidence relating to digital products, it should be possible for national courts to require such evidence to be presented in an easily accessible and easily understandable manner, subject to certain conditions.”

• No Liability Waivers: Companies cannot contractually exclude or limit their liability under the directive and disclaimers for software defects or security vulnerabilities are not valid: “Member States shall ensure that the liability of an economic operator pursuant to this Directive is not, in relation to the injured person, limited or excluded by a contractual provision or by national law.”

In short, the new EU PLD signals the start of a new era in which software quality, cybersecurity, and ongoing product support are not just best practices—they are legal obligations. Companies placing digital products on the EU market may wish to evaluate their compliance, engineering, and risk management strategies with the Directive in mind.

Photo of Michelle Yeary

Almost 15 years ago to the day, we posted the following question: why do third party payers and not patients bring RICO claims against drug and device companies for behavior that supposedly makes products cost too much?  We were reporting on a case that dismissed the RICO claims of patients because they were indirect purchasers of their knee implants.  The indirect purchaser rule is a standing doctrine employed most notably in Illinois Brick Co. v. Illinois, 431 U.S. 720, 744 (1977), to bar Illinois, an indirect purchaser of concrete blocks, from bringing an antitrust claim under the Clayton Act against the concrete block manufacturers. Rejecting the argument that Illinois—two levels down the distribution chain from the manufacturers—should be allowed to recover the fraction of the overcharge “passed on” to them, the Supreme Court noted:

Permitting the use of pass-on theories … essentially would transform treble-damages actions into massive efforts to apportion the recovery among all potential plaintiffs that could have absorbed part of the overcharge from direct purchasers to middlemen to ultimate consumers. However appealing this attempt to allocate the overcharge might seem in theory, it would add whole new dimensions of complexity to treble-damages suits and seriously undermine their effectiveness.

Id. at 737.

But we said this post was about RICO claims.  And so it is.  Fifteen years ago, the District of New Jersey found that the rationale for the indirect purchaser rule in antitrust cases applied equally to bar the claims of patient-plaintiffs in RICO claims (the Third Circuit held the same 29 years ago, see McCarthy v. Recordex Serv. Inc., 80 F.3d 842 (3d Cir. 1996)).  Now, the Middle District of Florida reaches the same conclusion in Humana Inc. v. Teva Pharmaceuticals USA, Inc., 2025 U.S. Dist. LEXIS 258748 (M.D. Fla. Apr. 28, 2025), to bar an insurer’s RICO claims.

Defendants include the manufacturer of a drug to treat multiple sclerosis and two “specialty pharmacies” that dispense that drug to plaintiff’s insureds, among others.  Id. at *2.  Plaintiff alleges that the manufacturer drove up the price of the drug through charitable copay-assistance funding.  There are no allegations that the drug did not do what it was supposed to do, only that plaintiff-insurer had to pay the inflated prices.  Plaintiff brought RICO and conspiracy to violate RICO claims as well as a host of state law fraud and consumer claims.  Id. at *3-4.  Defendants’ motion to dismiss asked the court to “extend the Supreme Court’s indirect purchaser bar from Clayton Act cases to civil RICO cases.”  Id. at *7. 

While neither the Supreme Court nor the Eleventh Circuit have addressed the issue, every circuit court to have considered the question has held that the rule applies to civil RICO cases.  Id. (citing cases from 3rd, 6th, 7th, and 8th Circuits).  As have other district courts within the Eleventh Circuit.  Id. at *7-8.  While not binding, the weight of authority is “exceedingly persuasive.”  Id. at *8. 

 First, the RICO statute’s civil remedy provision is modeled after the civil-action provision of the Clayton Act.  Applying the same meaning to similar statutory language is a “well-known canon of statutory interpretation.”  Id.  This is especially true when the comparable provisions share the same purpose—as they do here.  Plaintiff offered and the court found no compelling reason to deviate from the Supreme Court’s interpretation of the same language in the Clayton Act. 

Second, the rationale of Illinois Brick applies to RICO cases.  RICO cases have the same “complicated web of damages at multiple levels,” as antitrust cases.  Id. at *9-10.  Further, Illinois Brick, directly advised lower courts in individual cases not to engage in “an unwarranted and counterproductive exercise to litigate a series of exceptions.”  Id. at *10.  Direction that the Middle District of Florida took to heart.

Third, intentionally mis-quoting an Eleventh Circuit decision, plaintiff argued that a civil RICO plaintiff has standing if his injuries were proximately caused by a RICO violation.  The quote actually reads:  “[A] plaintiff has RICO standing only if his injuries were proximately caused by the RICO violation.”  Id. at *11. The court viewed the omission of the word “only” as an attempt to change the meaning of the legal authority.  Standing and proximate cause are overlapping, but separate concepts.  The Eleventh Circuit case plaintiff attempted to use held that proximate cause is required to plead a civil RICO claim.  But it did not address standing or the indirect purchaser rule.  Id. at *11-12, & n.8.  Therefore, it is easily reconciled with Illinois Brick.  A civil RICO plaintiff “must be a direct purchaser and must demonstrate proximate cause to state a viable civil RICO claim.”  Id. at *11. 

Finally, plaintiff argued that it was a direct purchaser because it made payments to the pharmacies on behalf of its insureds who were prescribed the drug.  But insurance companies are “third-party payors” which by definition means they are not “end-payors” and therefore not direct purchasers.  Id. at *13. 

Plaintiff’s RICO and RICO conspiracy claims were dismissed with prejudice for lack of standing.  As those were the only federal question claims in the case, the court declined to exercise supplemental jurisdiction over the remaining state court claims and those claims were dismissed for lack of subject matter jurisdiction.              

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