Photo of Stephen McConnell

The case of Dennis v. Bayer Healthcare Pharmaceuticals Inc., et al., 2020 WL 534307 (W.D. N.C. Feb. 3, 2020), has occupied our in bin for about a year, probably because there are aspects of it that rub us the wrong way. But not all of Dennis is a menace. If you represent a drug distributor, you might find Dennis useful.

The plaintiff in Dennis alleged that she was injured from gadolinium contrast agents used in MRIs. She sued a couple of manufacturers as well as a distributor. Her main claim was that the defendants should have warned that their products could cause retention of toxic gadolinium in patients with normal renal function.

One of the manufacturers had a pretty solid argument that the court could not exercise personal jurisdiction over it. The court essentially punted on this issue, reasoning that “[w]hen a case is at such an early stage in the proceedings, it is hard to expect a plaintiff to have information about a company’s jurisdiction beyond what is alleged by Plaintiff in her Amended Complaint”. We’ve seen that sort of rationale before in various contexts, permitting plaintiffs to file any sort of complaint they want and then see via discovery whether there is any there there. Blessing vague, speculative, or even agnostic complaints strikes us as a soft-headed approach. It is also at odds with the plaintiffs’ burden of proof in establishing personal jurisdiction.

Perhaps the Dennis court had an inkling that its ruling was iffy, because it denied the defendant’s personal jurisdiction without prejudice. The defendant could raise the issue again. When? Later. Meanwhile, the Dennis court invited the plaintiff to do better: “If Plaintiff has more information regarding this Court’s jurisdiction over the Bayer Defendants, she is encouraged to include it if she chooses to further amend her complaint.” That’s nice. Weak and ineffectual, but nice.

The Dennis court also punted on that same manufacturer’s preemption argument. The issue was whether the manufacturer could have, based on newly acquired information, executed a change being effected, and whether the FDA would have rejected such change. Other courts have applied preemption in gadolinium cases involving plaintiffs with normal renal function, but the Dennis court concluded that whether the FDA “would have rejected the label requested is not something that can be decided on the pleadings”. So we get more kicking of the can down the road.

The other manufacturer argued that the plaintiff had inadequately pled injury, causation, foreseeability, fraud, etc. The Dennis court again cut the plaintiff enormous slack in denying the motion to dismiss. And the Dennis court again invited the plaintiff to improve her pleadings: “However, if Plaintiff has more factual allegations to support her claims against Bracco, she is encouraged to include them if she chooses to amend her complaint”.

Hmmmmm. We wish judges would rule our way more often, even if they “encouraged” us to up our game.

Let’s turn to the part of the Dennis opinion where the court issued a more muscular ruling. The distributor relied upon the SCOTUS Pliva v. Mensing case, which held that generic manufacturers could not be liable for state law failure to warn claims because federal law did not allow generic manufacturers to change the warning labels. It was undisputed that distributors, like generic manufacturers, lacked any ability to change the warning labels. Thus, it is unsurprising that numerous courts have ruled that distributors cannot be liable for state law failure to warn claims. The plaintiff cited a Yaz case to the contrary, but it came out before Mensing, so the Yaz case was a worthless has-been (a Yaz-been?). The Dennis court ended up holding that, because federal law would not permit the distributor “to do what state law purports to require of it, Plaintiff’s incompatible state law claims are preempted.” There it is – an actual ruling and an actual dismissal of all the causes of action premised on failure to warn, including negligent misrepresentation and breach of express warranty. That is a bit more and a lot better than a pat on the head and a suggestion to do better. We might even call that ruling encouraging.

The distributor also moved to dismiss the remaining claims against it, but it was hard to determine what they even were, including whether they were any different from the failure to warn claim. The allegations also lumped defendants together and it was hard to tell who was supposed to have done what. Not to put too fine a point on it, the plaintiff’s allegations were a pail of goo. Predictably, the court decided to “allow Plaintiff to file a second amended complaint to address these deficiencies.” The court said that “if Plaintiff chooses to amend her complaint a second time, she should ensure that all her claims are supported by factual allegations.” Yes. Good idea. That same good idea should have held sway for the prior complaints. The Dennis court apparently is reluctant to call a plaintiff out until there are three strikes.

As we mentioned, this Dennis opinion is over a year old. Indeed, the case was already old (pending since September 2018) when the opinion was issued. Thus, the timid nature of the opinion is all the more astonishing and disappointing. But our story does not end there.

Two months after this opinion issued, and one week after an answer was filed, the case was dismissed outright. The stipulation of dismissal has some rather interesting terms:

The undersigned parties further stipulate and agree that, in the event Plaintiff files an action in any jurisdiction against any of the undersigned Defendants or McKesson Corporation (collectively the “Defending Parties”) bringing claims related to gadolinium-based contrast agents, Plaintiff will pay to each Defending Party named in the newly filed case all of that Defending Party’s costs and fees incurred in the defense of the present case, Civil Action No. 3:18-CV-00491 (the “Original Lawsuit”). The undersigned Defending Parties, in turn, agree that they will not otherwise pursue costs and fees associated with the defense of the Original Lawsuit.

All’s well that ends well, right? Perhaps the Dennis court even saw this resolution as a vindication of the kick-the-can strategy. We do not see it that way. The can should have been crushed much earlier.