On Thursday, we published a link to the New Jersey appellate court’s decision in McDarby and Cona v. Merck, Nos. A-0076-07T1, A-0077-07T1, slip op. (N.J. App.Div. May 29, 2008). We also explained that Bexis couldn’t comment on this one, because his firm is involved in the litigation.
So Bexis is out celebrating, and Herrmann gets stuck writing up the decision. Figgers.
(But don’t blame Bexis for what follows; he played no role in writing this post.)
We’re calling McDarby a double off the wall. It ain’t a home run, but it’s a very satisfying decision for folks in the drug and device industry.
The first thing we noticed was the 52-page statement of facts. That was a harbinger of something bad to come. When you’re going to win a case, you get a few innocuous pages of facts that basically say you behaved responsibly. (See, for example, the court’s statement of facts in Merck v. Ernst, No. 14-06-00835-CV, slip op. (Tex. App. May 29, 2008), which came down the same day as McDarby.)
But when you’re gonna lose, it’s 52 pages of thou “art as dark as hell, as black as night.” And that’s what the McDarby court laid on Merck. McDarby, slip op. at 1-52.With that kind of wind-up, we really weren’t looking forward to the pitch.
But the pitch was fine.
We lost basically one issue that we care about — whether FDA regulation preempts state law tort claims brought under the New Jersey Product Liability Act. Id. at 54-67. We don’t like to lose that preemption issue — heck, we don’t like to lose any issue — but we can live with this.
First, McDarby is a New Jersey state appellate court speaking to an issue of federal law. If you have to win some and lose some on federal preemption, you’d rather win in the federal courts and lose in the state courts. Ultimately, the decisions of federal courts will control on questions of federal law.
Second, the ultimate federal court — the U.S. Supreme Court — will be deciding the preemption issue in Wyeth v. Levine, which is scheduled to be heard next Term. No matter what the New Jersey court says now, we’ll probably learn the final answer to this question when the Supreme Court speaks within the next year.
Third, McDarby leaves plenty of room for argument for folks defending drugs other than Vioxx. McDarby said, for example, that the Preemption Preamble supports preemption only where state law mandated warnings “that FDA had specifically considered and rejected as scientifically unsubstantiated.” Id. at 63. According to the court, that had not happened with the alleged cardiovascular risk of Vioxx. But that certainly has happened in the context of other drugs, including, for example, the SSRI antidepressants and phenergan, the drug involved in Wyeth v. Levine. Even if the result in McDarby survives, it’s not clear how far it reaches.
McDarby also blows off the Preemption Preamble, id. at 58-67, declining to follow the Third Circuit’s recent decision in Colacicco. We would have liked to have seen a little more analysis here. In some jurisdictions, state courts are obligated to follow local federal circuit precedent on questions of federal law; in most jurisdictions, those federal decisions at least warrant deference. We’re not sure where New Jersey stands on this issue. (Actually, Bexis almost surely knows, but he can’t help with this post; and Herrmann could learn the answer if he did a little research, but it’s late on a Sunday night, and he’s not in the mood.) In any event, McDarby should have said something about its right to disregard Colacicco so cavalierly.
That’s it for the main federal issue. Let’s look at the state law issues, as to which (1) McDarby is a strong precedent, and (2) the U.S. Supreme Court will not settle the law definitively within the next twelve months.
On issues of New Jersey state law, there’s only one truly unhappy result. The New Jersey Product Liability Act creates a rebuttable presumption that a warning approved by the FDA is adequate. Before McDarby, plaintiffs could rebut that presumption in only one way — by proving that the manufacturer deliberately concealed information from the FDA.
McDarby creates a new way to overcome the presumption. It’s not quite clear what that route is, but it has something to do with “Merck’s economically-driven manipulation of the post-market regulatory process,” id. at 70, coupled with the supposed inadequacy of the FDA’s post-marketing regulatory power before the 2007 amendments to the Federal Food, Drug and Cosmetic Act. Id. (The court leaves open the possibility that the 2007 Amendments sufficiently strengthened the FDA’s power that FDA approval may have preemptive effect for drugs approved after the effective date of the Amendments. Id. at 70 n. 35.)
(McDarby also seemed quite taken with a law review article written by former FDA Commissioner David Kessler and Georgetown professor David Vladeck. Who the heck are Kessler and Vladeck, anyway? Surely, some day, some court will be persuaded by Beck and Herrmann, right?)
McDarby then ruled against Merck on a bunch of evidentiary issues, but those are all case- specific and unlikely to affect many cases in the future. Id. at 84-96.
There’s one last item on the bad side of the ledger. The court recognized the existence of some type of presumption that physicians would “read and heed” warnings provided by manufacturers in the package inserts on prescription drugs. Id. at 96-98. (As readers of this blog know, we’re not big fans of that supposed presumption.) But there was already some unhappy New Jersey law on that issue, id. at 96-97, so McDarby wasn’t plowing any new ground, and, in any event, the bad language in McDarby quickly turns to dictum. Id. at 99.
That’s the end of the bad stuff in McDarby. All the rest is good.
Very, very good.
So be happy:
First, there will be no punitive damages in pharmaceutical product liability cases in New Jersey. Id. at 108-19. The New Jersey Product Liability Act forbids punitive damages in cases involving drugs approved by the FDA, subject only to an exception if the manufacturer defrauded the FDA. McDarby holds that the fraud-on-the-FDA exception is preempted under Buckman. Punitive damages are thus no longer recoverable in most drug cases in New Jersey.
Second, plaintiffs can no longer bring product liability claims under New Jersey’s Consumer Fraud Act. Id. at 125. The Product Liability Act is the exclusive route to recovery for product liability-related claims; that Act displaces claims under the Consumer Fraud Act. That’s big news, because the CFA authorizes the recovery of attorneys’ fees.
Consider the case of the Conas, whose lawsuit was argued back-to-back with the McDarbys. The jury concluded that Vioxx did not cause any physical injury to Cona, and thus awarded him no recovery under the Product Liability Act. But because Cona had supposedly been misled into buying Vioxx, the jury award him $135 for the cost of the Vioxx — plus $2.27 million in attorneys’ fees (permissible only under the Consumer Fraud Act)! Cases like that make judges understand the danger of effectively grafting attorneys’ fees provisions onto unrelated statutes.
In the end, we’ll take this result and declare victory.
It’s a relatively unimportant loss on preemption and the heeding preemption and an important win on issues involving punitive damages in drug products cases and the availability of attorneys fees (through the Consumer Fraud Act) in product liability cases.
It’s a double off the wall.
We’re standing up, dusting ourselves off, and getting ready to take a big lead when the next batter steps into the box.