February 2015

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Our occasional claims of dyspepsia may be attributed to various things.  Professional witnesses offering personal opinions from the stand, juries deciding based on emotion and bias, plaintiff lawyers being sleazy, and judges writing decisions driven by a predetermined result or just bad reasoning come to mind. Sometimes, we recognize that our discomfort stems, at least in part, from the subject matter of a case extending past the reasonable, yet wide and knowingly self-inflated, bounds of our expertise.  Among our hundreds of posts, more than a handful touch on Drug & Device Law in that they (1) involve cases with our clients’ products far from product liability or (2) involve issues we see in our cases being presented in very different types of cases.  While we may throw in some caveats about how we are treading beyond our usual bailiwick, we still offer our views and perhaps even a somewhat blind rant.  Here we are again—personally, this blogger has skipped the last three weeks for trial preparation and denouement—with a decision in a case that is far afield in some respects, but just does not feel right in about every respect.

The decision of the First Circuit in In re Nexium Antitrust Litig., Nos. 14-1521, 14-1522, 2015 U.S. App. LEXIS 968 (1st Cir. Jan. 21, 2015), affirming a class certification order from the District of Massachusetts is not too surprising if you just consider the courts involved and the name of a drug in the case caption. If you add that, broadly categorized, this is a third party payor case, then our view that the decision does not make much sense is even less surprising.  The allegation in the case, though, is something we find fairly novel and decidedly weird.  Plaintiffs are “union health and welfare funds that reimburse plan members for prescription drugs”—that is, a type of third party payor—and they claimed that the defendant branded manufacturer of a particular heartburn drug and three putative manufacturers of a generic form of the drug conspired to overcharge for the branded drug when they entered into settlements over patent infringement suits that paid the putative generic manufacturers to not try to get their ANDA approvals and sell their own versions for about six more years.  Are you with us so far?  Not being able to sue under federal antitrust laws because the Supreme Court says indirect purchasers are too remote to have a cognizable injury, the plaintiffs sued under state antitrust laws—adopted by half the union specifically to provide a claim not available under federal law—and state consumer protection laws.  They sued in one federal court (the E.D. Pa.) and the case was moved to another by the JPML. They sought a class on behalf of everybody in the U.S. or its territories who paid (or will have paid) any money for the drug, including generic versions not yet on the market, for their own use or use by anybody else.  With our caveat about the limits of our expertise, this lead in makes us start wondering about subject matter jurisdiction, personal jurisdiction post-Bauman (especially with the foreign defendants), how third party payors could be class reps for patients who bought their own drugs or for people who bought drugs for their relative, how a court-approved consent judgment could be considered anti-competitive behavior without running afoul of Noerr-Pennington doctrine,  and how there was not some preemption issue in basing state law liability on an assumption that FDA would have approved one to three ANDAs even if there were no patent issues.  Then we took a deep breath and realized that the Nexium decision did
not address any of that stuff.  It did note, however, that the defendants had already won a jury verdict at trial this past December, but “[t]his, of course, does not moot the case here given the possibility of further proceedings.”  Then we went back to bellyaching about what else was wrong with the basic premise of this case.  Then we had a drink.  And we don’t mean an antacid.Continue Reading Indigestion Inducing Treatment of Class Certification Requirements

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In our initial post about Tincher v. Omega Flex, Inc., 104 A.3d 328 (Pa. 2014), we stated up front that we didn’t think that Tincher changed Pennsylvania law applicable to prescription medical products much, if at all.

We wrote:

For prescription products, the short answer is “not much..” . . . Largely as a result of concerns over liability for scientifically undiscovered risks . . . in Hahn v. Richter, 673 A.2d 888 (Pa. 1996) (another case Bexis briefed) the Court excluded prescription medical products entirely from Azzarello strict liability using Restatement §402A, comment k . . . .  Thus Tincher’s reworking of strict liability doesn’t affect prescription medical products because that theory wasn’t applicable in the first place.  Indeed, one of Bexis’ worries about the Third Restatement was that eventually it might call the Hahn strict liability exemption into question.  Without the Third Restatement, that doesn’t happen.

Just because we said so, however, doesn’t make it so.  We’ve learned recently that at least one plaintiff’s lawyer has created an argument for the opposite position – that Tincher supposedly opens up wide vistas of strict liability in prescription medical product cases – and has asserted it in certain medical device litigation in which none of your bloggers are participants.  One of our readers sent us that brief (a publicly filed document) and asked us to comment.

So we will, but we’re not identifying either the case or the plaintiff’s lawyer – if you’re reading, you know who you are.

To us, the plaintiff’s proposition is, in one word, absurd.  It 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.  There are three fundamental reasons why Tincher cannot be read in that fashion.Continue Reading Don’t Mix Apples & Bricks – Tincher Didn’t Change Pa. Drug/Device Law

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What follows is a guest post about a significant class action decision in Canada.  Our guest poster today is Chris Horkins of the Canadian firm Cassels Brock & Blackwell LLP.   We haven’t changed a thing, not even Canadian-style spelling, so as always our guest poster gets all the credit, and any blame, for what…

Photo of Michelle Yeary

Do we say often enough how much we dislike off-label promotion theories of liability?  It has its own section on the blog and on a quick skim through you will find traditional products liability cases, qui tam False Claims Act cases (and the subsidiary First Amendment litigation), securities fraud litigation, criminal actions, and third-party payer suits.  There are probably others, but we stopped scrolling.  The point is that just about everyone who wants to sue anyone in the pharmaceutical and medical device world has at some time tried to use off-label use and promotion to get the job done.

The fact that what is and is not permissible off-label promotion remains a question doesn’t help matters.  Really, it is what drives the vast scope of off-label litigation. And one of the primary problems is the confusion between truthful and untruthful off-label promotion. When courts, in our opinion, get it wrong is when they refuse to recognize that distinction. Simply because something is considered off-label promotion (addresses a use or indication not on the product’s approved labeling) doesn’t make it false, misleading or untruthful.  This is where we think the court got tripped up in Hricik v. Stryker Biotech LLC, 2015 U.S. Dist LEXIS 11714 (E.D. Pa. Jan. 30, 2015).

Plaintiff brought products liability claims against the manufacturer of a spinal fusion device and two of the manufacturer’s sales representatives.  The reps are residents of Pennsylvania and therefore, their presence in the suit defeats diversity jurisdiction unless they were fraudulently joined.  The defendant manufacturer made that very argument.Continue Reading Off-Label Promotion Allegations Trounce Fraudulent Joinder

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We’ve argued since PLIVA v. Mensing, 131 S. Ct. 2567 (2011), was first decided that its impossibility preemption rationale extended to innovator/branded drugs and was not limited to generics. We’ve won some in the district courts, but lost all too many as judges chanted “Levine, Levine, Levine” and refused to consider logic.

That seems to be changing.  On Friday the First Circuit – not a court with a pro-defense reputation – recognized precisely this in Marcus v. Forest Pharmaceuticals, Inc., No. 14-1290, slip op. (1st Cir. Feb. 20, 2015).   Marcus was something of an oddball case, a class action under California consumer protection statutes alleging that an innovator drug label “misleads” consumers by omitting adverse efficacy information.  Slip op. at 1, 8.   The remedy being sought was to force the defendant to seek a “redo” of its previous FDA approval, on the basis of the supposedly “correct” efficacy information. Id. at 10 (“plaintiffs request that the court ‘[p]ermanently enjoin[] [defendant] from continuing to sell or market [the drug] with its current drug label and direct[] [defendant] to seek FDA approval of a new [drug] label”).   It may have been precisely the First Circuit’s pro-plaintiff reputation (see our posts on Bartlett and Neurontin) that attracted these unusual claims.Continue Reading Breaking News – First Circuit Extends Mensing Preemption To Innovator Drugs

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This post is from the non-Reed Smith part of the blog only.

Removing a case to federal court can be a tedious process.  There are lots of deadlines and notices that need to be sent to different places.  But sometimes the process can be more than tedious.  It can be long.  And when it gets long, the plaintiff won’t help.  He’ll resist.

When that happens, you have to stick to it and be the little remover that could.

In Jackson v. St. Jude Medical Neuromodulation Div., 2015 U.S. Dist. LEXIS 975 (M.D. Fla. Jan. 28, 2015), St. Jude, one of three defendants, removed the case to federal court based on diversity jurisdiction.  But a few months later the federal court remanded the case back to state court because St. Jude couldn’t establish that the amount in controversy for each defendant exceeded the jurisdictional baseline of $75,000.

But – and this is key – St. Judge didn’t give up.  It knew that plaintiff was seeking more than $75,000.  So it asked.  When the case was returned to state court, St. Jude served a request that plaintiff admit that the amount in controversy exceeded $75,000 as to each defendant.  Id. at *5.  Co-defendant Medtronic did the same.  Id.  There was a timing issue, though.  The federal rules gave plaintiff 30 days to respond to the request.  Yet in fewer than 30 days the one-year, final deadline for a defendant to remove a case to federal court based on diversity would pass.  28 U.S.C. 1446(c)(1).

The plaintiff knew this.  So he resisted.  He refused to agree to a shortened deadline to respond to the request for admission.  Instead, he moved for a protective order and to strike the request.  So St. Jude and Medtronic doubled down.  They moved to expedite plaintiff’s response.  Id.  And they won.  The court ordered plaintiffs to respond to the request for admission ten days before the one-year removal period would run out.  Id.Continue Reading If at First You Don’t Remove, Try, Try Again

Photo of Steven Boranian

The Federal Trade Commission has a long reach, but its grip is not quite as strong as it was before the D.C. Circuit’s recent opinion in PomWonderful, LLC v. FTC, No. 13-1060, 2015 WL 394093 (D.C. Cir. Jan. 30, 2015). Section 5 of the FTC Act prohibits “unfair or deceptive acts or practices in or affecting commerce” and grants the FTC the power to enforce.  Since this broad mandate was enacted during the administrative explosion that accompanied the New Deal, the FTC has parlayed it into regulatory authority over a broad array of commercial activities, including data privacy, spam emails, product labeling, and marketing and advertising of all kinds. The drug and medical device industries certainly feel the FTC’s presence, including its regulation of advertising in connection with over-the-counter products.

It turns out, however, that product sellers have First Amendment rights that limit the FTC’s prerogative.  PomWonderful does not involve a drug of any kind, but it is fascinating reading because it involves fruit juice products for which the seller made numerous efficacy claims, such as that consuming the products would treat or reduce the risk of certain diseases.  The claims are similar to those we sometimes hear on the radio promoting dietary supplements or herbal remedies:

  • “Proven to promote cardiovascular health”
  • “30% decrease is arterial plaque”
  • “Prolonged post-prostate surgery PSA doubling time”

These are just a few examples, and there were others involving sexual function that we will leave aside for the moment.  But you get the idea.  The seller was engaged in more than mere puffery or vague claims that the juice was “good for you.”  These were specific disease-related efficacy claims.Continue Reading First Amendment Trumps FTC

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Appealability issues in multi-district litigation can  present knotty problems.  While we (that is, Bexis) came up with the preemption argument that killed off fraud on the FDA claims, the realities of MDL practice meant that, even after winning, there was no appeal.  Only when a peripheral defendant – an FDA consultant facing no other claims – filed a “me too” motion was an appealable order created. The consultant’s name was Buckman.

Thus we read with interest the resolution of the MDL appealability issue in Gelboim v. Bank of America Corp., 135 S. Ct. 897 (2015).  Gelboim has nothing to do with drugs and devices; it was an anti-trust case.  The substantive issue was “anti-trust injury,” which doesn’t matter here except to the extent that the district court held that the plaintiffs didn’t have any cognizable injury.  Since the plaintiffs in question didn’t have any other claims, that meant their action was kaput.  Time to appeal, right?  The district court thought so.  135 S. Ct. at 903-04 (discussing procedural history).  In addition, the MDL court issued an order under Fed. R. Civ. P. 54(b), allowing certain other plaintiffs to appeal, even though they had other claims remaining.  (A use of Rule 54(b) also produced the Buckman appeal.)

Not so fast!  The court of appeals said no. Based on a “strong presumption” that appeals in “consolidated cases” were not final, the Second Circuit (the appeal was from the S.D.N.Y.) dismissed the appeal.Continue Reading Supreme Court Clarifies MDL Appealability Issues

Photo of Stephen McConnell

New Hampshire has always marched to its own flinty tune. It was the first colony to establish a government independent of British authority.  It holds the first presidential primary every four years, insisting that candidates visit waffle shops and bloviate to the amused Yankee locals. You’ve probably seen New Hampshire license plates with the “Live Free or Die” motto.  That motto supplied the title for episodes of both The Sopranos and Breaking Bad.  What other state can make that boast?  And what other state with such a small population can list among its offspring such eloquent luminaries as “Go West Young Man” editor Horace Greeley, “Liberty and Union, now and forever, one and inseparable” Senator Daniel Webster, “And miles to go before I sleep”  poet Robert Frost, and we-can’t-think-of-a-quote President Franklin Pierce?

New Hampshire has played a significant role in American legal history.  Daniel Webster won a case against the Devil.  One of the early major U.S. Supreme Court cases involved Dartmouth College.  We cannot remember what the case was about, though we think it had something to do with Delta House being put on double secret probation.  The Bartlett v Mutual product liability case gave rise to some awful rulings in the New Hampshire federal court before the Supreme Court set things right in what might be our favorite case of the last five years.

In today’s case, Murray  v. Hogan, #226-2013-CV-00600 (New Hampshire App. Ct. Feb. 2, 2015), a New Hampshire court addresses Riegel preemption, as well as the dreaded parallel claim exception.   As far as we can tell, it is the first such decision from the Granite State. (We gratefully tip our cyber cap to David Ferrara at Nutter McClennen for sending the case our way.)  The plaintiffs in Murray brought negligence and products liability claims claiming injuries from a knee replacement gone wrong.  The plaintiffs sued several defendants, including the manufacturer of the artificial knee, as well as the sale rep who was in the operating room and assisted in preparing the artificial knee for insertion.  The artificial knee was a class III medical device, so it comes as no shock that the company moved for summary judgment against all of the plaintiffs’ claims as being preempted by federal law.  Even less of a surprise, the plaintiffs disagreed, arguing that federal preemption does not apply because: (1) the artificial knee did not meet federal regulations, (2) the plaintiffs would like to have some discovery, please, and (3) the company is vicariously liable for the conduct of the sales rep.Continue Reading New Hampshire Applies Riegel Preemption

Drug & Device Resources

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FDA-regulated products now account for an estimated one-fifth of overall economic activity in the U.S. They have also been the focus of a litigation explosion. This timely guide covers all aspects of litigation involving drugs, medical devices, vaccines and other FDA-regulated prescription products.
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