This post is not from the Dechert side of the blog, because of that firm’s involvement in this matter.
We mentioned, in the “here’s what’s out there” portion of our 2013 Top Ten post that “The long-pending Lance case (2010 #-6) remains undecided by the Pennsylvania Supreme Court, some three years after oral argument.” Full disclosure: Some of us worked on the Lance case in the past, but none of us currently represents anybody in that litigation. So, while we are quite familiar with Lance, the post here does not address anything outside of the Supreme Court’s opinions and official record.
Lance pends no longer. And if Lance in the Pennsylvania Superior Court warranted #6 on 2010’s worst ten list, the Pennsylvania Supreme Court’s equally unpalatable effort is likely to rank significantly higher on the still-young 2014’s eventual list. For background (since it has been a long time), here is our description of Lance in the Superior Court from back in 2010:
6. Lance v. Wyeth, 4 A.3d 160 (Pa. Super. 2010). . . . Lance is another example of the disturbing trend in post-Levine cases for plaintiffs to push for – and, worse, for courts to allow – “design” related claims against prescription drugs that are really frontal assaults on FDA drug approval decisions. Here, the claim was “negligent design,” which had never before been recognized in a prescription drug product liability case in Pennsylvania. 4 A.3d at 165-66. Disturbingly, the opinion does not discuss the requirement, imposed in negligent design cases involving other products, that the plaintiff must prove the existence of a safer alternative design. Compounding matters, Lance also included gratuitous dictum suggesting that a post-sale duty to warn may exist in prescription drug cases, id. at 167-68 – despite that theory being a form of strict liability, which Pennsylvania doesn’t recognize at all in prescription medical product litigation. If not for other, favorable, aspects of Lance (rejecting the “unreasonably dangerous product theory allowed in Wimbush and also failure to test or to recall), Lance might rank even higher/lower. We discussed Lance here. An appeal to the Pennsylvania Supreme
Court is pending.
Quite frankly, nothing in Lance improved in the 2+ year wait for it to be decided. After all this time we had frankly thought the Court to be irretrievably split 3-3, with the newly appointed interim justice, Stevens, recused due to his participation at the Superior Court level. Thus, we had been speculating that the
most likely outcome would be a to vacate and remand after the court decides Tincher v. OmegaFlex (discussed here, here, and here) and clarifies Pennsylvania product liability law generally.
No such luck, although Lance does allow for some interesting speculation about what might ultimately happen in Tincher (see below). That’s particularly true because Justice Thomas Saylor, ordinarily the court’s most conservative member on product liability matters (and thus our favorite), wrote the majority opinion in Lance, aligning himself in this instance with justices with whom he frequently disagrees with on tort issues. The vote was 4-2, with Chief Justice Castille and Justice Eakin dissenting.
So what happened?
The first half of the majority opinion describes the proceedings below and the arguments of the parties in considerable detail. To us, the most interesting aspects of the first 24 pages of that opinion are footnotes and other asides. Thus, we have footnote 6, reaffirming the learned intermediary rule: “Per the learned intermediary doctrine, the manufacturer’s duty to warn is directed to physicians.” Maj. Op. at 5. We have footnote 8 (discussed more later), chastising the lower court for equating “strict liability” with “product liability.” Id. at 8-9. We also have footnote 11 reaffirming the essential holding of Hahn v. Richter, 673 A.2d 888 (Pa. 1996), that Pennsylvania law has adopted, and applies, Restatement §402A, comment k across the board: “Other [jurisdictions], including Pennsylvania, have taken a blanket approach applying comment k to preclude strict-liability design-defect claims for all prescription drugs.” Maj. Op. at 13.
However, all of these nuggets cannot obscure that damage that the Court did to the law of negligence. Although the majority presents its approach as conservative – by viewing the defendant as seeking to “contract” existing negligence law rather than plaintiffs trying to “expand” it, Maj. Op. at 32-37 (discussing “common-law lawmaking”), that is mere sleight of hand (as the dissent points out, Dis. op. at 7-8). It simply cannot be denied that the sort of “negligence” claim(s) allowed in Lance have never been previously recognized in Pennsylvania (or, indeed, just about anywhere). Where is the precedent recognizing the supposed “existing duty” (Maj. Op. at 24) in negligence? Lance cites none because there is none. Is there any prior precedent allowing design-related “negligence” action in the absence of any other way to design the same product? No. – every prior decision under Pennsylvania law has held
that a negligent design claim requires a feasible alternative design as part of what’s “reasonable.” How about a claim that a product is just too dangerous and should either never have been sold or should not be sold any longer? Ditto. How about allowing “other existing medications, treatments, or interventions as a substitute” for the requirement of an alternative design. Ditto – no precedent, just law review articles. In none of these instances does the majority in Lance cite a single decision by that or any other court allowing such a claim. Certainly, no prior decision has recognized a cause of action for “lack
of due care resulting in an untenably dangerous product being put into the marketplace.” Maj. Op. at 27. Indeed, the mere term “untenably dangerous”
is a new one on us, and we’ve been practicing in Pennsylvania for quite a while now.
So what has the Court done?
(1) Adoption of comment k across the board in strict liability does not preclude a negligence cause of action concerning the “design” of a prescription drug. Maj. Op. at 28. Rather Comment k is “premised on the assumption that all products within its scope carry some net benefit (relative to risks) for some class of consumers,” id., and thus doesn’t address the kind of claim the plaintiff advances. Id. at 28.
2) There is “greater flexibility” in negligence as a cause of action, id. at 31, so it can embrace a claim for “a lack of due care” by a defendant who “knew, or should have known, that [its] product was too dangerous to be used by anyone.” Id. at 33 n.25. The “three-prong manufacturing/design-defect/warnings overlay is more consistent” with strict liability than negligence. Id. at 40. Rather, negligence is a “continuum” including a duty of “non-marketing or discontinuance of marketing when it becomes or should become known that the product simply should not be used in light of its relative risks.” Id. at 43.
(3) While “proof of a reasonable alternative design is a typical device used to establish defect,” the court has not yet “required proof of an alternative safer design as an absolute prerequisite to the advancement of a design defect claim . . . although this is the general approach of the Restatement Third.”
Maj. Op. at 41-42 & n.36 (emphasis original). Interestingly, the court all but adopts the Third Restatement of Torts §6(c) on this point,
The American Law Institute has chosen to categorize the type of claim Appellee has advanced under the rubric of design defect, see RESTATEMENT (THIRD) OF TORTS: PRODS. LIAB. §6(c), and, significantly, the general requirement otherwise pertaining under the Restatement of a reasonable alternative design to establish a design defect, see id. §2(b), has not been extended to the prescription-drugs context. See id. §6(c).
Maj. Op. at 42-43. This is another novel ruling. While (as we’ve discussed here) we’ve seen a few lower court cases applying §6(c) in cases involving medical
devices, Lance is the first case to apply it to a prescription drug, as well as the first state high court anywhere to adopt it − if that is indeed what the court has done, as the majority is somewhat tentative. Maj. Op. at 43 n.37.
(4) Probably to avoid the Third Restatement’s explicit rejection of duty-to-recall claims, see Restatement §11 (and having to admit being a minority of one), the Lance majority stays away from that label. “Whatever the policy considerations may be in the recall/retrofit arena, we are convinced that a manufacturer or supplier has a duty to cease further distribution of a product” if “the commodity is too dangerous to be used by anyone.” Maj. Op. at 43.
(5) FDA Compliance – apparently including FDA approval − is admissible evidence, but not dispositive of a negligence claim.” Maj. Op. at 38 (“Pennsylvania courts permit defendants to adduce evidence of compliance with governmental regulation in their efforts to demonstrate due care”). While the majority did cite Wyeth v. Levine, 555 U.S. 555 (2009), a few times, the issue of whether the novel causes of action adopted by the Court would be preempted, in whole or in part, was not presented – or even mentioned – in either the majority or dissenting opinions (keep reading, we’ll rectify that).
It’s all well and good for the majority to note that it’s “necessary to maintain limiting principles,” and that the Court “eschew[s] the notion of a pure loss-spreading tort system.” Maj. Op. at 30 n.22. But a “limiting principle” – especially on negligence, which is a much broader cause of action than strict liability – is precisely what the requirement of a feasible alternative design is. Without it, plaintiffs can simply allege that whatever product (or service, or anything else, since this is negligence) was too dangerous to be allowed to exist in the marketplace. Since Lance involved summary judgment, it’s not clear what more than that bare allegation (“worthless and dangerous,” id. at 36) is necessary to get to the jury – since the issue will always be disputed. So the societal availability of anything and everything, from booze to beef to bungee jumping, ends up in the hands of a single jury not focusing on (and not competent to focus on) anything beyond the facts of a single case. See id. at 44 n.38 (“we know of nothing which would preclude her from presenting this claim to a jury on such terms”). For all the majority’s acknowledgment of the greater competence of the other branches of government, id. at 33-34 (discussing a “political branch[’s]” “superior policymaking tools and resources”), allowing individual juries to find products and services “untenably dangerous” so that it was “negligent” not to remove them from the market is a massive usurpation of the power of those more competent branches of government to determine what things should, or shouldn’t, be available for the public to use.
The majority points out that “for policy reasons this Court has declined to extend strict liability into the prescription drug arena.” Maj.Op. at 32. That’s nice, but if a negligent design claim can be asserted merely on the basis of an “untenably dangerous” risk/benefit profile without the need to establish any alternative design at all, then who needs strict liability anyway? We’re not entirely sure how far the majority intends to go with this novel “too hazardous
to be used by anyone” theory, given this footnote contrasting products administratively removed from the market with those that aren’t:
[A]pplication of Appellee’s theory of liability would present more difficult questions in a circumstance in which a prescription drug maintained its FDA approval, it remained on the market, and U.S. doctors continued to prescribe it. The assertion that no reasonable physician would prescribe the drug . . . is capable of gaining greater traction when, as here, the inquiry is more in the nature of a post-mortem.
Maj. Op. at 39 n.33. Does this mean that the new “untenably dangerous” theory is limited to already-withdrawn products? It might, but then again it might not. The Lance opinion is unclear on the point. All we can say is that nothing in Lance forbids plaintiffs from bringing such claims against anything and everything that, for whatever reason, they think they can get a jury to decide should not be publicly sold.
And what’s with the overt dictum, Maj Op. at 39-40, in a case by definition not involving warnings at all, suggesting that some “underpinnings” of the learned intermediary rule (which the opinion earlier acknowledged as the law of Pennsylvania), might have “come into question” as a result of DTC advertising? We don’t know where this dictum may be intended to lead (if anywhere), but it’s disturbing to see it, based on no record and no facts. Particularly since only five
pages earlier the same opinion cited lack of a sufficient record (on a claim never asserted in the trial court, as the dissent points out, Dis. Op. at 7) for not addressing the costs of drug development, id. at 35, the majority’s willingness to speculate about non-record “evolution of the health-care delivery system” and/or DTC (which wasn’t even legal back then) seems dramatically inconsistent. But it’s there, and we on the defense side have to be prepared to deal with it.
We would be remiss not to point out that Lance’s “negligence” cause of action – that a defendant (and not just a pharmaceutical defendant, either) has a duty of care not to market a product that some jury might say (after-the-fact, of course) is “too harmful to be used by anyone,” Maj. Op. at 47 − bears an uncanny resemblance to the no-alternative-design “design defect” claim (in “strict liability”) that was held impliedly preempted as “impossible” in the Supreme Court’s recent Mutual Pharmaceutical Co. v. Bartlett, 133 S. Ct. 2466 (2013), decision. In its penultimate footnote, the Lance majority states its “general agreement” that:
FDA approval of a drug permits the manufacturer to market it, but it does not require the manufacturer to do so. If the manufacturer concludes that its
product is [too] unsafe [to be used by anyone], it can and must take it off the market.
Maj. Op. at 44 n. 39 (citation and quotation marks omitted). Similarly, the claim in Bartlett was
[A]lthough [defendant] cannot legally make [its drug] in another composition (nor is it apparent how it could alter a one-molecule drug anyway), it certainly can choose not to make the drug at all; and the FDCA might permit states to tell [defendant] it ought not be doing so if risk-benefit analysis weights against the drug. . . . This is second-guessing the FDA . . . [but] the decision to make the drug and market it in [plaintiff’s state] is wholly its own.
Bartlett v. Mutual Pharmaceutical Co., 678 F.3d 30, 37-38 (1st Cir. 2012).
The Supreme Court Bartlett held that this “stop selling” claim predicated on a defendant’s mere sale of a purportedly “unreasonably dangerous” product could not avoid impossibility preemption:
The Court of Appeals reasoned that [defendant] could escape the impossibility of complying with both its federal- and state-law duties by “choos[ing] not to make [the drug] at all.” We reject this “stop-selling” rationale as incompatible with our pre-emption jurisprudence. Our pre-emption cases presume that an actor seeking to satisfy both his federal- and state-law obligations is not required to cease acting altogether in order to avoid liability. Indeed, if the option of ceasing to act defeated a claim of impossibility, impossibility pre-emption would be “all but meaningless.”
Id. at 2478 (citations to First Circuit Bartlett and PLIVA v. Mensing decisions omitted).
As stated in Bartlett, “[o]nce a drug − whether generic or brand-name − is approved, the manufacturer is prohibited from making any major changes to the qualitative or quantitative formulation of the drug product, including active ingredients, or in the specifications provided in the approved application.” Id. at 2471 (emphasis added) (citation and quotation marks omitted). Thus, the claim in Lance that a prescription drug (or a medical device, for that matter)
is improperly designed and thus either should (1) have a different design or (2) else be removed from that market, is very likely preempted under Bartlett,
since the first theory is “impossible” when FDA pre-approval is required (as it is for all drugs), and the second is not a legitimate way around preemption of the first theory. In this sense it was probably just as well that the Pennsylvania Supreme Court sat on Lance as long as it did, because in the interim the “negligence” claim that it recognized was invalidated for constitutional reasons that couldn’t have been in the parties’ briefs.
A couple of broader concluding points, relating to the pending Tincher case:
First, there are suggestions in Lance that the negligence/strict liability dichotomy – central to many of the issues in Tincher – is not long for this world:
[S]trict liability is merely a subset of products liability law. . . [and] the phrase “unreasonably dangerous” is derived from negligence theory . . . . [Thus] the panel’s approach of analyzing Appellee’s main claim – which was expressly stated in negligence – as if it were grounded upon strict liability, is deeply flawed.
Maj. Op. at 8-9 n.8. These observations suggest to us a belief that negligence and strict liability aren’t really all that different.
Second, there’s the majority’s quasi adoption of Restatement Third §6(c), discussed above. While this obviously suggests a general inclination towards the Third Restatement, it does more than that. In our post about the Tincher oral argument, we pointed out (and we quote ourselves) that the most significant sticking point for some of the justices was Restatement §2’s alternative design requirement, particularly in “what they called ‘outlier’ cases – asbestos and pharmaceuticals were mentioned.” It may be that Lance contains the answer to those expressed concerns – in the form of melding §6(c)’s exception with a novel form of “negligence” liability. So it may be that Lance is the price to be paid for adoption of the Third Restatement in Tincher. Or maybe not. It’s all speculation.
Which raises the larger question of whether Tincher will be worth it, if that’s the case.
In run of the mill design defect cases, there’s no doubt in our minds that adoption of the Third Restatement in Tincher would be exceedingly beneficial for defendants. Elimination of the super strict form of strict liability, which has plagued defendants for 35 years, has a plethora of useful evidentiary, procedural, and jury instructional effects. However, if there is now some general – and heretofore undiscovered − “negligence” duty to remove products from the market (assuming Lance is not limited to already-removed products), simply on a disputed allegation that they are “too dangerous” for anyone to use, then the very sort of “categorical liability” that even Pennsylvania strict liability decisions have refused to countenance (as to alcohol, cigarettes, and firearms, among other products) now raises its ugly head in “negligence.” While FDA-regulated manufacturers have a strong possible refuge in preemption, as just discussed, other non-regulated product manufacturers may well not be so lucky. Again, we repeat, if Lance is negligence, then who really needs strict liability?