Today’s case, Ganz v. Grifols Therapeutics LLC, 2023 WL 5437356 (S.D. Fla. 2023), involves a biologic but also speaks to drugs and medical devices. The mixed decision dismisses design-defect and failure-to warn claims but allows manufacturing-defect and failure-to-recall claims to proceed. Although we’ll briefly summarize those rulings, the decision is more interesting for noting three issues that it does not resolve—issues involving preemption, pleading standards, and common-law duties.
The Ganz plaintiff alleges that her husband died after experiencing hypersensitivity to a biologic approved by the FDA. She asserted negligence, design-defect, failure-to-warn, and manufacturing-defect claims against the manufacturer and its holding company.
The court dismissed all claims aginst the holding company for lack of personal jurisdiction. It held that the plaintiff failed to carry her burden of establishing general or specific jurisdiction over the holding company because she offered no evidence to rebut an affidavit stating that the holding company was neither incorporated nor headquartered in the forum state and had not engaged in any claim-related conduct in the state. In short, the court applied the uncontroversial principle that conclusory allegations in a complaint are insufficient to overcome evidence tending to disprove jurisdiction. 2023 WL 5437356 at *4.
As for the claims asserted against the manufacturer, some were dismissed while others were not.
The court dismissed the design-defect claim as pleaded, holding it impliedly preempted under Mutual Pharmaceutical Co. v. Bartlett, 570 U.S. 472 (2013), because “[i]t would be impossible for [the manufacturer] to comply with both its state duty to change the composition of [the biologic] and its duty under 21 C.F.R. § 601.12(b)(2) not to make such a change without first obtaining FDA approval.” 2023 WL 5437356 at *7.
Note, however, the caveat. The court dismissed the design-defect claim “as pleaded.” As construed by the court, the complaint alleged that the biologic approved by the FDA is defective as a matter of state law. So understood, the claim rests on the contention that the manufacturer had a state-law duty to change the biologic’s composition notwithstanding the federal duty to leave the composition unchanged. Bartlett clearly forecloses such a clam.
But what if the plaintiff had instead pleaded a so-called “pre-approval design defect claim” premised on a supposed state-law duty to “have come up with a safer design prior to seeking FDA approval”? 2023 WL 5437356 at *7. Would such a claim be preempted? Courts are divided. As we discussed here, the Sixth Circuit held such claims preempted in Yates v. Ortho-McNeil-Janssen Pharmaceuticals, Inc., 808 F.3d 281 (6th Cir. 2015), while as we discussed here, the Seventh Circuit reached the contrary conclusion in Kaiser v. Johnson & Johnson, 947 F.3d 996 (7th Cir. 2020). Yates was number one on our 2015 top-ten list; Kaiser was number three on our 2020 ten-worst list. That circuit split notwithstanding, the Ganz court “decline[d] to address” the issue, finding that the plaintiff had not pleaded a “pre-approval” design-defect claim in the complaint but had instead articulated it for the first time in opposition to the manufacturer’s motion to dismiss. 2023 WL 5437356 at *7. Similarly, because the manufacturer had not raised it until its opening brief, the court refused to consider the manufacturer’s contention that “Florida products liability law does not permit a pre-approval design defect claim.” Id. at *7 n.6. The court directed the parties to brief the issue thoroughly if the plaintiff files an amended complaint purporting to assert such a claim.
Ganz dismissed the plaintiff’s failure-to-warn claim, but not on preemption grounds. Despite “reject[ing]” the plaintiff’s contention that Wyeth v. Levine, 555 U.S. 555 (2009), “broadly eliminates any preemption defense for a brand-name manufacturer of drugs,” the court concluded that the plaintiff’s failure-to-warn claim was not preempted because, in the court’s view, she adequately alleged the existence of “newly acquired” information that would have permitted the manufacturer to unilaterally change its label without prior FDA approval under the changes-being-effected regulation. 2023 WL 5437356 at *8. According to the court, the plaintiff adequately pleaded the existence of newly acquired information sufficient to justify a labeling change when she alleged that the manufacturer had recalled some lots of the biologic after receiving reports of increased rates of hypersensitivity. While there may be some facial plausibility to the court’s finding, it is hard to reconcile with the court’s simultaneous recognition that, “[i]n conducting a review of the safety of [the biologic] following [the manufacturer’s] voluntary withdrawal of certain lots, the FDA concluded … that the risk of hypersensitivity was adequately described in [the biologic’s] labeling.” Id. at *9. Regardless of that inconsistency, the court dismissed the failure to warn claim on Twombly grounds, holding that the plaintiff failed to plead any facts plausibly suggesting that the biologic’s label—which mentioned the risk of hypersensitivity seventeen times—was in fact inadequate. Id. at *10.
It is worth noting that although Ganz dismissed the failure-to-warn claim on pleading grounds, it sidestepped an interesting pleading issue—namely, whether a plaintiff must plead around preemption to avoid dismissal. On the facts of Ganz, the question would have been whether the plaintiff was required to plead facts plausibly suggesting the existence of newly acquired information that would have allowed the manufacturer to unilaterally change its label without prior FDA approval. Finding that the plaintiff had pleaded sufficient facts in any event, the court did not need to determine whether such facts were required to avoid dismissal on preemption grounds. But the pleading issue is a recurring one in medical-product litigation. Hoping to evade preemption for as long as possible, plaintiffs often argue that preemption is an affirmative defense, that plaintiffs are not required to plead around affirmative defenses, and that claims therefore cannot be dismissed on preemption grounds at the pleading stage. When confronted with such an argument, defense counsel should point to the many cases granting motions to dismiss on preemption grounds and remind courts that plaintiffs are frequently required to plead around affirmative defenses, such as the statute of limitations, to avoid dismissal.
Ganz allowed two claims to proceed: a manufacturing-defect claim and a failure-to-recall claim.
As happens all too often, the court let the manufacturing-defect claim slide on very thin factual allegations. Although the complaint identified no purported manufacturing defect, the court thought the allegations of a manufacturing defect sufficiently plausible given that the FDA had evaluated the manufacturer’s manufacturing processes when trying to identify the cause of the increased rate of hypersensitive reactions. 2023 WL 5437356 at *12. The court did not offer, and we cannot think of, a reason why one could plausibly infer the existence of a manufacturing defect from the mere fact that the FDA had evaluated the manufacturer’s manufacturing processes.
Finally, the court held that the plaintiff had adequately stated a failure-to-recall claim, rejecting the manufacturer’s contention that the complaint failed to allege facts sufficient to adequately plead causation. But here again the court failed to address an interesting issue—whether there even is a common-law duty to recall a defective product. The court did not reach the question because the manufacturer did not raise it in its opening brief. But as we have noted here, here, and here, courts and the Restatement hold that there is no such duty.
Because it granted the plaintiff leave to amend, the Ganz court might yet have an opportunity to address the questions that it put to the side. Stay tuned.