Safe harbor. We like the sound of that. The term connotes a level of calmness and predictability that we find appealing in the regulation of drugs and medical devices, and we find ourselves writing about safe harbors a lot lately. Bexis recently gave us his survey of safe harbors against state consumer fraud claims, and we commented just the other day that perhaps a safe harbor should apply in a class action alleging California consumer fraud claims based on purported overrepresentation of an antidepressant’s efficacy. We doubted a safe harbor actually would apply in that case, but maybe we spoke too soon.
In Marcus v. Forest Laboratories, Inc., No. 13-11343-NMG, 2014 WL 866571 (D. Mass. Mar. 5, 2014), the District of Massachusetts applying California law found that California’s safe harbor applied to—wait for it—a class action alleging California consumer fraud claims based on purported overrepresentation of an antidepressant’s efficacy. The plaintiffs in Marcus alleged that the FDA approved an antidepressant for adolescent use based on two studies showing statistically significant improvements compared against placebo. Id. at *2. Placebo-controlled studies are the gold standard, but according to the plaintiffs, the FDA set the bar too low. It instead should have required a showing of “clinically significant” improvement over placebo, which would “examine whether the observed benefit of a drug outweighs the risks associated with the drug when compared to alternative, less risky treatments.” Id. at *1.
In other words, the plaintiffs proposed a new, hypothetical standard under which the sale of the drug for adolescent use amounted to consumer fraud, even though the FDA had approved the drug for sale under the very real FDCA. That sounds to us like plaintiffs attempting to apply California’s consumer statutes to condemn conduct that another law clearly permits.
It must have sounded that way to the district court too, because the count dismissed the complaint. As the court explained, the California safe harbor doctrine bars certain claims brought under California’s consumer statutes, and for the doctrine to apply,
another provision must actually “bar” the action or clearly permit the conduct. . . . In other words, courts may not use the unfair competition law to condemn actions the legislature permits.
Id. at *3 (emphasis added) (quoting Cel-Tech Communications v. L.A. Cellular Tel. Co., 20 Cal. 4th 163 (1999)). If the light is green, it cannot be consumer fraud to drive through the intersection. You get the idea. In Marcus, the district court reasoned that Congress had entrusted the FDA to determine whether there is substantial evidence of efficacy for a particular purpose and whether a proposed label is false or misleading in any way. Because the FDA had approved the antidepressant and its labeling, the safe harbor applied to bar claims that the labeling was false or misleading under California’s consumer laws. Id. at *4.
It seems California’s safe harbor is more vital than we originally thought. The court distinguished the case from cases involving food and homeopathic remedies, where the safe harbor did not apply, because prescription drugs are subject to greater and comprehensive federal regulation. Id. at *4. The court also distinguished cases involving alleged violations of federal law. Id. at *5. That seems obvious to us: If federal law prohibited the conduct, it would not “clearly permit” the conduct and the safe harbor, by its own terms, would not be of any use.
Finally, the court rejected the novel argument that Wyeth v. Levine “calls into doubt” the viability of safe harbor provisions in state consumer protection statutes. Id. at *5. Plaintiffs sometimes treat Levine like is it some sort of all-purpose antidote to all they think is wrong with the law, but this argument can be seen only as a gargantuan stretch. The Supreme Court held in Levine that FDA approval of prescription drug labeling does not necessarily result in implied federal preemption of state law failure-to-warn claims. 555 U.S. 555, 570 (2009). Levine was about implied preemption, under which state-law gives way to federal law where it is impossible to comply with both. (There are other forms of implied preemption, but “impossibility” preemption is the form most germane to prescription drugs.) Implied preemption cannot be relevant where there is no state-law claim to begin with—for example, when a state-law creates a safe harbor into which the defendant can take refuge. Kudos, we suppose, to the plaintiffs for thinking creatively, but we side the district court, which recognized that “Plaintiffs provide no justification to extend [Levine] to preclude state safe harbor defenses to claims arising under state consumer protection law and this Court has found no authority permitting it to do so.” Id. at *5.
So there you have it. The Marcus order is short and sweet, but it sure grabbed our attention. The present and future of drug and medical device class actions (to the extent there is any) will revolve around consumer protection statutes. And while we will not shy away from opposing class certification in any class action, we should not forget that defenses may apply before a class certification motion is even a glimmer in counsel’s eye. The defendants in Marcus did not forget, and they won.