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Scott v. Amazon.com, Inc., ___ P.3d ___, 2026 WL 468578 (Wash. Feb. 19, 2026), is one of those decisions that makes us go hmmm.  Here’s why.

Scott involves very unfortunate facts, four people who, in separate incidents, committed suicide using the same chemical, which they all allegedly purchased using the defendant’s online sales platform.  Id. at *1.  So far, so bad.  But it’s the other alleged facts – which had to be taken as true on a pleadings-based motion to dismiss – that make the Scott decision so palpably wrong (at least to us; it was a unanimous decision).  Those facts – alleged by the plaintiffs themselves –leave us scratching our heads about how there could conceivably be liability.

  • The chemical at issue, while a deadly poison at high concentrations, has legitimate uses, being “used in laboratories for research and medical purposes” and “in meat preservation.”  2026 WL 468578, at *1.
  • All of the decedents were determined to use it to commit suicide and did so within a few days or at most weeks of receiving it.  Id.
  • At least some, maybe all, of the decedents visited online “suicide forums.”  Id. at *2.  There were no allegations that the defendant had anything to do with those forums.
  • At least some, maybe all, of the decedents, consulted “a suicide instruction book that devotes a chapter to lethal inorganic salts, which contains instructions on how to use [the chemical] to die by suicide.”  Id.
  • The “suicide instruction book” told the decedents that the chemical was “readily available online and provide[d] a hyperlink to the [chemical]  products on the [defendant’s] webpage.”  Id.
  • One of the decedents also bought a “small scale” to make ensure he used enough.  Another also bought a prescription drug “that suicide forums recommend purchasing to prevent life-saving vomiting that occurs when [the chemical] is ingested.”  Id.

Note:  unlike the Scott opinion, we neither identify the chemical nor provide the title of suicide manual.

In sum, the pleadings in Scott established that these decedents, for whatever unfortunate reasons, were bound and determined to kill themselves.  They researched and planned how to do it, carried out their plans, and succeeded.  If that isn’t superseding cause (and maybe in pari delicto) as a matter of law, we don’t know what would be.

But Scott in its infinite judicial wisdom, held that these allegations stated a claim − the plaintiffs’ decedents’ deliberate and sustained intent to kill themselves notwithstanding.  First, Scott held that intentional suicide was no longer ipso facto a superseding cause:

Plaintiffs alleged . . . that the decedents’ suicide risk was known to [defendant] prior to the negligent act complained of . . . which creates a duty to safeguard the four decedents from the foreseeable consequence of its existence. . . .  Taking the facts Plaintiffs have alleged as true, we are unable to say, as a matter of law, beyond a reasonable doubt, that the decedents’ deaths were not proximately caused by [defendant’s] alleged tortious sales practices of the [chemical].  The rule . . . that the act of suicide is a superseding cause as a matter of law does not control here. We hold that the act of suicide, as a matter of law, is not a superseding cause.

Id. at *5 (citations and quotation marks omitted) (emphasis added).  “Beyond a reasonable doubt”?  Since when do defendants have to meet a criminal standard of proof to establish superseding cause?

Okay, we grant that jurisprudential arguments exist that cut both ways on suicide in the abstract.  But Scott was anything but abstract.  Consider the pleaded facts.  If this isn’t superseding cause as a matter of law, what could be?  (1) The decedents frequented suicide-related internet forums.  (2) They consulted a book that told them specifically what to use and where to buy it.  (3) The defendant did not run the forums nor write the book.  (4) The decedents were directed by the sites and the book to use this chemical, and how much of it was necessary.  (5) The book told the decedents where they could buy it.  (6) The book told the decedents they could buy a prescription drug to suppress the body’s ability to resist the poison through vomiting.  (7) Tragically, the decedents followed these instructions and achieved the result they were seeking – to kill themselves.

Perhaps some suicides might not be superseding causes.  See Id. at *5 (relying on a case about a hospital that “actually” knew of a “foreseeable” risk by a specific individual”).  These people, however, were internet purchasers, not individually known individuals.  So the upshot of Scott appears to be an indiscriminate duty owed to the entire world (“every individual has a duty to exercise reasonable care to avoid the foreseeable consequences and harm from their acts,” including “ exposing another to harm from the foreseeable conduct of a third party”).  Id. at *5 (citations and quotation marks omitted).  We can see no way, short of banning sale of this chemical – again one with legitimate uses – to have prevented its use by these determined decedents.  Indeed, Scott hints that this may be the opening salvo for judicially imposed product bans.  Id. at *6 (rejecting argument against “allow[ing] juries to legislate whether a well-made product should not be sold because of potential misuse”) (internal quotation marks omitted); cf. id. at *10, 13 (concurring opinion stating that the defendant “never restricted . . . sales to adults or to commercial buyers” and indicating that sale for “household use” should be banned).  We have always believed that banning products should be a legislative, not judicial, act.

Even more concerning (if possible) is that Scott waved through a warning-based claim.  See Id. at *2 (describing plaintiffs’ allegations that the defendant’s website had “no warnings or descriptions of the product . . . visible to customers” and “no warnings to consumers about how deadly the product is or how to reverse its effects”).  Okay, we’ll take all those facts as true.  Then what?

The decedents here were deliberately trying to kill themselves.  They already knew from suicide websites and a suicide manual that the product would kill them if they used X amount of it.  What warning would have stopped them?  Putting a skull and crossbones symbol or a “deadly poison” label on the product would only have encouraged them further.  Moreover, the decedents didn’t want to “reverse its effects” (except maybe when it was too late) – they bought a separate drug to prevent that.  Nor was there any indication that any emergency responder didn’t know how to respond (assuming success was ever possible).

Our blog is directed, first and foremost, to the defense of prescription medical product liability litigation.  Scott is concerning because, while it involved a chemical, many prescription and OTC drugs can be deadly in the event of an overdose – whether accidental or intentional.  Will plaintiffs mount the same over-the-top absolute liability allegations in prescription medical product liability litigation?  Probably, but we doubt they will succeed, any more than with the SSRI suicide cases being litigated when we first started blogging.  First, prescription medical products are just that; they require a physician’s prescription, whether bought in a store or over the internet.  Scott did not have to address the learned intermediary rule.  Second, Scott involved a direct seller, not a product manufacturer.  That’s another layer of protection.  Third, and perhaps most important, both prescription medical products and OTC drugs (and their labeling) must be FDA approved.  States cannot ban, through litigation or otherwise, products that have been federally approved for marketing nationwide.  E.g., Mutual Pharmaceutical Co. v. Bartlett, 570 U.S. 472, 488-49 (2013) (see our post here, collecting stop selling preemption cases).

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Cannabis is big business, so it was only a matter of time before someone filed a consumer class action claiming that his cannabis was schwag.  It happened in Illinois, where a judge in the Northern District promptly shot it down—not because the plaintiff’s theory was necessarily wrong, but because his theory of deception was a theory of law, not of fact.  The order also provides useful guidance on Article III standing and privity requirements in the context of state-regulated industries.

In McKenzie v. Progressive Treatment Solutions, LLC, No. 25-cv-1768, 2026 WL 636741 (N.D. Ill. Mar. 6, 2026), the plaintiff purchased a cannabis vape cartridge—a cannabis product containing upwards of 74% THC.  That concentration of THC was significant because the Illinois CRTA divides cannabis products into two categories: smokeable products and cannabis-infused products (“CIPs”).  The distinction matters because Illinois limits CIP possession to 500 milligrams of THC and single-package sales to 100 milligrams, while smokeable concentrates face no equivalent cap.  The product at issue—sold in a one-gram quantity at 74% THC potency—far exceeded the CIP thresholds.

So where is the fraud?  Well, the vape cartridge that this plaintiff purchased was labeled as though it was a smokable product—to which no THC cap applies.  The plaintiff argued, however, that the CRTA defines “smoking” as the “inhalation of smoke caused by the combustion of cannabis.”  And, because vaping involves heating rather than burning, the cartridge allegedly was not a smokeable product at all—it was a CIP, unlawfully sold with THC concentration well over the statutory limit. 

The plaintiff therefore demanded his money back on behalf of himself and a class of purchasers.  He did not allege any harm resulting from his use of the cartridge, or even that he ever used the cartridge.  His alleged injury was the purchase price of an allegedly unsafe product. 

The district court dismissed the action.  To start, the court ruled that the plaintiff had suffered an injury in fact by virtue of paying for the product, but he had standing to sue only in connection with the product that he purchased.  His complaint purported to encompass all of the defendants’ “vapable oils” exceeding 100 milligrams of THC, but the court held that a plaintiff cannot acquire standing for unpurchased products “through the back door of a class action.”  Id. at *2-*3.

The most significant portion of the order addresses why the plaintiff’s fraud claims failed on the merits.  The court applied the longstanding Illinois rule that “misrepresentations or mistakes of law cannot form the basis of a claim for fraud.”  Id. at *6.  Because all people are presumed to know the law, “erroneous conclusion[s] of the legal effect of known facts constitute[ ] a mistake of law,” not a misrepresentation of fact.  Id.  Here, the plaintiff did not allege that the defendants misrepresented the contents of the cartridge, its potency, or its efficacy.  He alleged only that the defendants’ products were CIPs and that the defendants concealed that fact by packaging their products as though they were not.  That alleged delineation is legal in nature, depending on the interpretation of such statutory terms as “smoking” and “combustion.” 

In other words, the plaintiffs alleged that the defendants misrepresented the product’s regulatory classification.  That alleged conduct is not an actionable representation of fact.  As the court concluded, “if the CRTA does consider vaping to be smoking, or if it does regard the underlying process as involving combustion—which, by [the plaintiff’s] own admission, requires one to parse both statutory and dictionary definitions—then Defendants neither misrepresented nor concealed anything, period.”  Id. at *7.

The plaintiff’s contract-based claims fared no better.  On the breach of express warranty claim, the court held that no actionable warranty had been identified:  The plaintiff did not allege that the product’s labeling was false, only that it was inconsistent with what CIP regulations would require.  Breach of express warranty requires that goods deviate from the label, not merely from a legal standard.

Both the express and implied warranty claims failed also for lack of privity.  Because the plaintiff purchased the product from a dispensary—and not from any defendant—he was not in privity with the manufacturers.  Nor could plaintiff bring himself within any exception.  First, the “direct dealing” exception did not apply because passive website advertising and general consumer-facing marketing do not constitute the kind of direct, individualized communication contemplated by the exception.  Second, the “third-party beneficiary” exception failed because the plaintiff did not allege that the defendants knew his individual identity—only that defendants had knowledge of consumers generally.

Finally, the unjust enrichment claim was dismissed as a derivative claim that could not survive independently once the fraud claims were extinguished.

We find the McKenzie order useful for a few reasons.  First, it clearly illustrates the mistake-of-law doctrine as applied in consumer fraud litigation in Illinois.  That doctrine is easy to overlook, but is potentially dispositive whenever a plaintiff’s theory of deception turns on the regulatory or statutory characterization of a product (an example being whether the product was being used on- or off-label), rather than on a factual misrepresentation about its physical attributes.  Second, the case reinforces an increasingly firm stance that class action plaintiffs must establish personal standing for each product they seek to challenge at the pleading stage, rather than deferring the question to certification.  Finally, the rulings on privity reinforce the governing rules and vigilantly limit the application of supposed exceptions.  At least in this court, there is no substitute for genuine direct dealing with individual buyers.

The dismissal was without prejudice, leaving the door open for the plaintiff to replead.  Whether he can do so in a way that characterizes the defendants’ conduct as a misrepresentation of fact rather than of law—an inherently difficult task given the theory he has developed—remains to be seen.

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Five months ago, we posted on a decision from an Ohio intermediate appellate court finding that a state AG action against sellers of vaping products was impliedly preempted under Buckman.  Part of what got our attention about the decision in State ex rel. Yost v. Cent. Tobacco & Stuff, Inc., No. 24 CAE 11 0103, 2025 WL 2828526 (Ohio Ct. App. Oct. 1, 2025) (“CTS”)—now published at 273 N.E.3d 714—was that implied preemption applied to a state AG action the same as it would have to a private action.  We also were taken aback by how the CTS dissent seemed confused about some preemption basics.  In State ex rel. Yost v. Elevate Smoke, LLC, No. C-250175, 2025 WL 3688747, — N.E.3d — (Oh. Ct. App. Dec. 19, 2025) (“Elevate”), we end up with the same result as to “identical” claims brought by the same state AG against a different vaping retailer.  Despite the overlap, we thought that Elevate was worth discussing.  For one thing, whereas the CTS decision by Ohio’s Court of Appeals for the Fifth District was split, the First District’s decision in Elevate was unanimous.  Ergo, it lacked a dissent that someone looking to avoid preemption could cite.  It also added that the plaintiff’s claims were preempted under an obstacle theory, something raised as stalking horse in the CTS dissent and not argued by the defendant in Elevate.  Seeing the same counsel representing the defendants in both CTS and Elevate and advancing the same preemption arguments also reveals the broader strategy of a self-described “preemption nerd” to advance the law that might also favor manufacturers of FDA-regulated medical products when they get sued by a state AG or a private litigant.  (James Fraser gets the much sought-after “shout out” from us.)

As in CTS, in Elevate,Ohio’s AG went after a retailer for selling vaping products that FDA had not approved—making them “adulterated” in FDCA terms—and for not including labeling identifying them as such.  The asserted claims were framed under Ohio’s consumer protection laws but clearly emanated from FDA requirements.  The Elevate trial court found all the claims were impliedly preempted under Buckman.  In its ruling, the trial court took a motion to dismiss and converted it to a motion for summary judgment because extraneous materials attached to the complaint were considered.  The first part of the appellate decision involved determining that the trial court’s citation of Ohio’s version of 12(b)(6) was harmless error because the preemption decision rested solely on questions of law with no real dispute about whether any operative facts were disputed.  Although we are procedural sticklers, this error was clearly harmless; if the plaintiff lost under a 12(b)(6) standard, the plaintiff would have lost under a Rule 56 standard.

The meat of Elevate started with a detailed discussion of the Family Smoking Prevention and Tobacco Control Act (“TCA,” as used in Elevate), how it affects vaping products, how plaintiff’s asserted claims relate to it, and some of the basics of express and implied preemption.  By and large, the discussion of preemption was strong and included a number of the drug decisions we discuss on a regular basis.  Compared to the typical express preemption language applicable to Class III devices, OTC drugs, or vaccines, the carve-out in the TCA is broader, consistent with an “explicit decision to preserve for the states a robust role in regulating, and even banning, sales of tobacco products.”  2025 WL 3688747, *7 (quoting U.S. Smokeless Tobacco Mfg. Co. v. City of New York, 708 F.3d 428, 436 (2d Cir. 2013)).  Relevant here, “more stringent” state requirements “relating to . . . the sale . . . advertising and promotion of . . . tobacco products” are not expressly preempted, meaning additional point-of-sale restrictions by states are not expressly preempted.  Id. at *8-9.  At least some of plaintiff’s claims survived express preemption,

Unlike the dissent in CTS, the court in Elevate understood that claims can be impliedly preempted even if a statutory carve-out saves them from being expressly preempted.  After citing the right law and noting that the trial court and CTS found these claims impliedly preempted under Buckman, the Elevate appellate court found the claims impliedly preempted under Buckman.  With two minor gripes, we find the analysis in Elevate thorough and correct.  Plaintiff’s counts—whether tied to the sale of the unapproved products, allegedly misleading consumers that the products were approved by not saying they were unapproved, or failing to explain what the “Origin Label” required by the TCA means—all sought to enforce the TCA.  Id. at *11-12.  Only FDA can do that, just as Buckman found with the FDCA and medical devices.  “In substance, by seeking to create civil liability for Elevate Smoke’s sale of unauthorized e-cigarettes, the State seeks to enforce the TCA.”  Id. at *11.  The analysis of the “Origin Label” theories of liability noted that the defendant could not have simultaneously complied with the federal requirements and the proposed state obligation.  Quoting Bartlett, the Elevate court noted, “The preemption doctrine does not force an actor faced with competing state and federal laws ‘to cease acting altogether in order to avoid liability.’”  Id. at *12.  The court also rejected the plaintiff’s argument that the proposed application of Ohio’s consumer protection law was like the directory requirements in Wisconsin and North Carolina statutes that other courts had found not preempted.  It clearly was not.

Lastly, in a footnote to the impossibility discussion, the Elevate court included a brief discussion of why the claims based on the “Origin Label” would also be impliedly preempted under an obstacle theory.  Id. at *12 n.2.  “The TCA imposes strict labeling requirements to limit consumer confusion and to combat illicit trade of tobacco products . . . . [and c]ompliance with [the proposed state requirements] would weaken Congress’s attempt to prevent illicit trade and frustrate the stated purpose of the TCA.”  Id.  This may be a bit too sui generis to be used in drug or device preemption arguments, but, where an obstacle argument (even if made by the court itself) has won, we like to point it out.

Us being us, we also like to air our gripes.  First, the court said there was a presumption against implied preemption because state regulation of tobacco predated federal law.  That would make sense for field preemption, where a presumption against preemption still exists, but there is no such presumption for implied preemption regardless of the product at issue.  We have explained this more than a few times.  Second, the court noted that plaintiff had raised the Tenth Amendment in suggesting its claims were less vulnerable to implied preemption than those of a private litigant.  It would have been good for the court to reject that argument expressly.  It did so impliedly by noting that only the federal government can enforce the FDCA/TCA.  Neither the state AG nor private litigants are the federal government.  However, the Tenth Amendment should not help the plaintiff anyway because the TCA fits within a few powers delegated to the federal government in the Constitution.  Also, the Supremacy Clause is the ultimate source for all federal preemption, so the Tenth Amendment is a red herring.  Elevate may have had other reasons to reject the argument, which could have been cited when other State AG plaintiffs try to get creative in arguing against implied preemption.  They will surely keep bringing preempted claims and arguing that their status protects them from implied preemption that would bar similar claims brought by private plaintiffs.

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At the DDL blog we unashamedly confess our biases.  Foremost among those biases is that we walk the defense side of the street.  Another inescapable bias, at least for this particular scribbler, is that we know and like many of the Philly judges. In the City of Brotherly Love, familiarity breeds respect. 

Over the past fortnight we have been mulling over the most recent presentation at the University of Pennsylvania Inn of Court, which discussed a habeas petition on behalf of Thomas Mattox in 1943. Heroic Philadelphia Judge Clare Gerald Fenerty declined to send Mattox back to Georgia, where he had been arrested on what looked like a specious charge and where there was a chance he would be lynched.  That Inn of Court presentation was headed up by E.D. Pa. Judge Kelley Hodge.  Her group reenacted the habeas oral arguments (including extraordinarily effective advocacy by legendary Philadelphia lawyer Raymond Pace Alexander) with Judge Fenerty played by his grandson, who is currently an EDPa AUSA. It was riveting and inspirational. 

In today’s case, County of Dakota v. United Biosource Corp., 2026 WL 637426 (E.D. Pa. March 5, 2026), Judge Hodge ruled on a matter that might have lacked the drama of the Mattox habeas, but nonetheless implicated some important issues. From our reading of Dakota, we get the impression that some lawyer(s) went out and dug up a bevy of rather obscure third-party payors and attempted to resuscitate allegations about price increases and off-label promotion from a couple of decades ago.  One major problem is that the alleged main actor back then was now bankrupt and could not be sued. The result was an overly long (204 pages) complaint that even the court complained focused more on what non-parties supposedly did, and not very much on why the actual defendants could be liable.  

The central claim was that the defendants got control of the drug Acthar and then deployed a new marketing strategy that removed it from retail distribution and jacked up its price by over 100,000%.  The third-party payors alleged that they had overpaid. The complaint laid out a “white coat marketing scheme,” involving bribery of key opinion leader doctors to promote unapproved uses of Acthar, misrepresentations about drug’s safety and efficacy, and lies about why the drug had gotten so expensive. The amended complaint included claims for violations of the Racketeering Influenced and Corrupt Organizations Act (RICO), various state consumer protection laws, negligent misrepresentation, aiding and abetting, unjust enrichment, various federal and state antitrust laws, conspiracy to defraud, along with requests for declaratory and injunctive relief. All the claims were dismissed.  

The antitrust claims merited little discussion.  The plaintiffs more or less abandoned those claims, not responding at all to most of the defendants’ arguments, and in any event were indirect purchasers that lacked antitrust standing.  

The RICO claim is why the decision is included here.  If there is a more overused and abused statute than RICO, we cannot think of it. It has been stretched well beyond its original design. Several significant rulings in Dakota relate to this count.  First, allegations about what non-parties said or did cannot support RICO fraud claims, so the claim did not approach the necessary specificity of pleading required by Rule9(b). 

Second, the allegations of off-label promotion failed.  They were internally contradictory, since elsewhere the plaintiffs had denied basing any claims on any FDA standard.  (Perhaps that was an effort at a preemption dodge.) Those contradictions “perplexed” the court.  Beyond the conflict, “off-label marketing is not per se fraudulent.”  The drug’s actual indications were never allegedly concealed. To the extent any actual misrepresentations might have been alleged, they were never tied to any of the existing defendants, and once again the allegations concentrated on non-parties.  As to the actual defendants, plaintiffs alleged only that “one or more of the above misrepresentations were repeated to representatives of the Plaintiffs, their beneficiaries and/or their medical providers.”  Who made them was not clear. It was even less clear who received them.  Rule 9(b) defeated these claims as well.  

Third, charging high prices did not render those prices “false” or constitute an actionable misrepresentation or omission. The plaintiffs tried to save this claim by alluding to the defendants’ use of a patient assistance plan that somehow circumvented patient complaints and prevented third party payor “advance awareness about Acthar’s high prices.”  As the court concluded, this argument “evades reason.”

In sum, the opinion held, “the Amended Complaint is framed with extensive allegations and conjecture that, when opened, is hollow and devoid of the fundamental substance that is needed.”  So, yes, in answering the villain’s question at the end of the old Little Caesar gangster movie, this is the end of RICO – at least for this case. 

A dogs’ breakfast of state law claims were also dismissed because, on the face of the complaint, they were barred by relevant statutes of limitations.  Early on in the ruling, Judge Hodge listed several other similar lawsuits that had been filed by the same plaintiff counsel. Those lawsuits had been filed in ND Illinois, D. Maryland, D. N.J., and in EDPa.  The actions in Illinois, Maryland, and New Jersey did not go well for the plaintiffs.  Only in ED Pa. was the defense motion to dismiss denied. It was a one-page order.  Ugh.  But that case was later reassigned to Judge Hodge, and, as she showed in the Dakota decision, she conducts a thorough examination of the issues.  Those other, earlier lawsuits supplied a strong basis for holding the state law claims in Dakota time-barred. 

There is also an important ruling in Dakota that Pennsylvania rejects cross-jurisdictional class action tolling.  Otherwise, the Pennsylvania borrowing statute controls and all the claims flunked Pennsylvania law.  “The limitations period for a foreign cause of action brought in Pennsylvania courts should never be construed to be longer than would be the case if the same events had occurred in Pennsylvania to a Pennsylvania plaintiff.”  The relevant Pennsylvania statute pegged the statute of limitations at six years and, based on the date of last initial purchase and/or the filing of the Illinois action, the plaintiffs were late by several months.  The plaintiffs’ invocations of continuing violations and fraudulent concealment were unavailing. The earlier lawsuits undermined the discovery rule, and no conduct (continuing or not) had been alleged within the six year period. 

Most of the counts were dismissed with prejudice, but for a few the plaintiffs have a chance to replead.  Based on the quality of their prior handiwork, any amendment is likely to show the triumph of hope over experience. 

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Today’s guest post is from Dechert‘s Mary Kim. She takes a closer look at a case where plaintiff’s use of AI landed them in hot water and how defendants can make the most of these situations. As always our guest posters deserve 100% of the credit (and any blame) for their writings.

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The existing commentary on the growing epidemic of artificial intelligence (“AI”) hallucinations in legal filings has largely focused on the forest—the staggering and accelerating volume of cases, along with the inadequacy of existing sanctions.  All of that commentary is correct, and the numbers are genuinely alarming.  But sometimes, it is worth stepping back and looking carefully at a single tree. 

On March 2, 2026, this blog’s modest proposal on the abuse of AI issues mentioned the LeDoux v. Outliers, Inc. case.  No. 3:24-CV-05808-TMC, 2026 WL 291023 (W.D. Wash. Feb. 4, 2026).  This case is one of those cases that warrants a closer read.  Not because it involves a single rogue citation slipping through the cracks, but because of the sheer breadth, variety, and audacity of the errors catalogued in the court’s opinion.  Reading the opinion carefully is a useful exercise because it illustrates just how many ways AI hallucinations can infect a case, and just how difficult the cleanup can be once the infection has spread.

The LeDoux case is a case involving allegedly defective nootropic (cognition improving) supplements.  The plaintiff, a medical nurse officer in the United States Army, sued the defendants, various entities and individuals involved in the design, manufacture, and sale of the nootropic supplements at issue, for negligence, unfair trade practices, failure to warn, design and manufacturing defect, breach of warranty, and misrepresentation and fraud in the Western District of Washington.  Plaintiff alleged that defendants’ nootropic supplements were adulterated with amphetamines, causing her to test positive on a military drug screen, which triggered a felony court-martial prosecution and resulted in the destruction of her military career, loss of her pensions and benefits, and severe emotional harm.  The legal and factual issues, however, were quickly overshadowed by something else entirely.  

Defendants identified multiple citations in plaintiff’s proposed amended complaint, Daubert motion, motion to strike affirmative defenses, expert evidence, and response to defendants’ motion to strike experts, which they believed to be false and hallucinated by AI.  All told, these AI hallucinations spanned more than five separate filings.  And the defense did not just flag the problem in a footnote.  They did the work and provided various tables for the court describing the faulty citations.  That kind of methodical, document-by-document, citation-by-citation opposition work is what turned a case about supplements into a case about professional misconduct. 

The breadth of what defense counsel uncovered is worth going through carefully, because it illustrates how thoroughly AI-generated sloppiness can permeate a plaintiff’s entire case.  Plaintiff’s proposed amended complaint quoted text from a statute, RCW 7.72.010(2), that did not exist.  For example, plaintiff alleged that a defendant “performed functions that constitute manufacturing activity within the meaning of RCW 7.72, including ‘supplying a component part,’” but the term “supplying a component part” did not exist in RCW 7.72, and the definition of “manufacturer” in RCW 7.72.010(2) did not include someone who “supplies” a component part.  Id. at *1. 

Plaintiff also submitted over a dozen quotes from various expert reports that did not exist.  For example, plaintiff cited the deposition of one of her experts to argue that dietary supplements are uniquely prone to “post-production degradation of stimulant compounds,” but that quote did not appear anywhere in the deposition transcript.  Id. at *2.  Plaintiff also cited nonexistent cases and included quotes from other cases that did not exist in the cited cases.  Each of these was caught by defense counsel checking the actual sources.

Perhaps the most strategically significant finding for defense purposes involved hallucinations in plaintiff’s expert reports (something we’ve also addressed).  One expert report cited several articles that did not exist or were attributed to the wrong author, and another expert report cited the same articles and included the same citation errors.  The court found this “suggest[ed] [p]laintiff’s counsel may have been so involved with the drafting of expert reports as to ‘jeopardize the experts’ independence.’”  Id. (citation omitted).

The cleanup, or attempted cleanup, made matters worse.  Plaintiff’s counsel conceded that some citations were incorrect and tried to address the errors, but, as the court noted, “[h]er explanations and corrections [were] incomplete at best and misleading at worst.  Plaintiff’s ‘corrected’ Daubert motion replaced some false quotations with real ones, but in doing so, completely changed their meaning.”  Id. at *3.  For example, the original filing stated that dietary supplements are uniquely prone to “post-production degradation of stimulant compounds.”  The correction substituted: “based on the literature, there is known degradatory properties to amphetamines over time.”  Id.  These are not the same proposition.  The correction did not fix the error; it substituted a different point that happened to have a real citation behind it, which raised its own questions.  Similarly, plaintiff’s counsel stated that she cited In re Washington Mutual “for the wrong proposition” and suggested she had “considered citing” it for a proposition relating to negative causation, which differed significantly from her original use of the case to argue that an “unclean hands” defense is only available when a plaintiff seeks equitable relief.  Id.

Finding that plaintiff had “submitted dozens of inaccurate factual and legal citations across at least five different filings,” and that “erroneous citations suggest[ed] [p]laintiff’s counsel submitted these filings without ‘conduct[ing] a reasonable inquiry into the facts and the law’ as required by Rule 11(b),” the court ordered plaintiff’s counsel to show cause why she should not be sanctioned.  Id. (citation omitted). Plaintiff’s counsel responded to the order with admissions of non-compliance with Rule 11, acknowledging that certain citations were incorrect.  It remains to be seen what sanctions, if any, the court will impose.  

AI hallucinations are not just an abstract ethics problem.  They can be an opportunity.  The LeDoux case is the clearest illustration yet of what happens when defense counsel is paying attention and plaintiff’s counsel is not.  The errors were there.  The defense found them.  And the court acted.  With that in mind, here is what defense counsel should take from LeDoux.  None of these principles are novel; rather, they are the fundamentals.  But LeDoux is a useful reminder that the fundamentals, overlooked by one side and embraced by the other, are what this entire case turned on.

  1. Check every citation in every brief plaintiff files.  It takes time, but as LeDoux demonstrates, the payoff can be substantial—not just in getting bad arguments struck, but in triggering Rule 11 scrutiny that reframes the entire litigation dynamic.
  2. Build a record of the errors methodically.  Defense counsel here did not just tell the court there were problems.  They provided tables cataloging the faulty citations filing by filing, giving the court everything it needed to issue a detailed show cause order.  That kind of organized presentation is what converts a discovery of errors into a litigation weapon.
  3. Watch the cleanup as carefully as the original filing.  When opposing counsel tries to walk back errors, the manner of the correction is itself important.  Substituting a different proposition for the fabricated one rather than acknowledging the original proposition was unsupported is exactly the kind of misleading correction that compounds the original Rule 11 violation.
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Rule 32(a)(3) of the Federal Rules of Civil Procedure provides:  “An adverse party may use for any purpose the deposition of a . . . designee under Rule 30(b)(6).”  Does that imply the converse – that a corporation’s affirmative use of its own Rule 30(b)(6) witness’ testimony is prohibited?  This issue came up at a conference we recently attended, so we decided to take a look.

The answer appears to be no.  Almost all federal courts allow corporations in litigation to use the testimony of their own 30(b)(6) witnesses as affirmative evidence in their own cases in chief, as long as the testimony otherwise meets the usual evidentiary requirements.  That was the case in Vehicle Market Research, Inc. v. Mitchell International, Inc., 839 F.3d 1251 (10th Cir. 2016), where the court affirmed the defendant’s use affirmative use of the testimony of its own 30(b)(6) witness, even though it was arguably contradictory of prior testimony.  Both the affirmative use of the testimony, and subsequent cross-examination, were proper under the Rule.  Id. at 1258-59.

The implied converse procedural argument mentioned above was rejected in Patsy’s Italian Restaurant, Inc. v. Banas, 508 F. Supp.2d 194 (E.D.N.Y. 2007):

Plaintiffs misinterpret the Federal Rules of Civil Procedure in objecting to the use of the deposition testimony of defendants’ officers . . . in support of defendants’ summary judgment motions, arguing that such testimony cannot be used at trial.  [Rule 32] does not prohibit a party from submitting the deposition testimony of its own officers on a summary judgment motion, particularly when such testimony was taken by the adverse party, as was the case here.  Plaintiffs’ objection is therefore overruled.

Id. at 200 n.3 (citations omitted).  Another more recent discussion is in Tijerina v. Alaska Airlines, Inc., 2024 WL 270090 (S.D. Cal. Jan. 24, 2024), also confirming that a corporation can use its own designee’s testimony affirmatively – so long as it is otherwise admissible:

FRCP 30(b)(6) designees may not, however, offer testimony at trial that consists of hearsay not falling within one of the authorized exceptions.  And the exceptions . . . do not apply when an organization wishes to elicit testimony from its own corporate designee. . . .  [W]here testimony is not sought by the adverse party, a corporate representative may not testify to matters outside his own personal knowledge. . . .

Tijerina v. Alaska Airlines, Inc., 2024 WL 270090, at *2 (S.D. Cal. Jan. 24, 2024) (citations and quotation marks omitted).  See IA Collaborative, LLC v. Fathom Loop, LLC, 2024 WL 2938856, at *4 (N.D. Ill. June 11, 2024) (rejecting “the proposition that a party cannot use its own Rule 30(b)(6) witness’s testimony at summary judgment”); McGriff Insurance Services, Inc. v. Madigan, 2022 WL 16709050, at *1 (W.D. Ark. Nov. 4, 2022) (denying blanket objection to use of 30(b)(6) testimony; “30(b)(6) deposition testimony could be presented by a non-adverse party at a hearing as long as . . . it’s based on [the deponent’s] personal knowledge”); Abbott Laboratories v. Feinberg, 2020 WL 7706571, at *1 (S.D.N.Y. Oct. 15, 2020) (allowing trial testimony of corporation’s own 30(b)(6) witness about “(1) items within her personal knowledge and (2) information she learned from [that party’s] business records”); In re RFC & RESCAP Liquidating Trust Action, 2020 WL 504661, at *6 (D. Minn. Jan. 31, 2020) (trial testimony of corporate designee admissible when offered by the corporation “[t]o the extent that such information is within [the designee’s] knowledge”); Stryker Corp. v. Ridgeway, 2016 WL 6585007, at *2-3 (W.D. Mich. Feb. 1, 2016) (corporate designee could testify at trial “based on personal knowledge and not on hearsay, or that an exception to the hearsay rule applies”); Dodson Aviation, Inc. v. HLMP Aviation Corp., 2011 WL 1234705, at *10 (D. Kan. March 31, 2011) (rejecting argument that Rule “32(a)(3) prohibits a corporation from introducing into evidence at trial its own 30(b)(6) deposition”).

Conversely, numerous cases limit the scope of what 30(b)(6) witnesses may testify to when later called at trial to otherwise admissible matters.  Union Pump Co. v. Centrifugal Technology, Inc., 404 F. Appx. 899, 903-04 (5th Cir. 2010) (corporate representative testimony at trial properly improperly included both “rank hearsay” and matters outside personal knowledge); Kraft Foods Global, Inc. v. United Egg Producers, Inc., 2023 WL 5647204, at *11 (N.D. Ill. Aug. 31, 2023) (“the Federal Rules do not include any express lane for Rule 30(b)(6) depositions of non-parties when the witness lacks personal knowledge”); Hess v. Biomet, Inc., 2019 WL 5965172, at *6 (N.D. Ind. Nov. 13, 2019) (corporate party could use its own 30(b)(6) testimony at trial, but that testimony “will still have to comply with the rules of evidence in order to be admitted”); TIG Insurance Co. v. Tyco International Ltd., 919 F. Supp.2d 439, 454-55 (M.D. Pa. 2013) (similar result allowing 30(b)(6) witness only to testify to events occurring after he was hired by the corporation).  Thus, the general rule is that corporations may offer their own 30(b)(6) witness’ testimony at trial, but only to the extent that – like any other proffered testimony – it is otherwise admissible, the chief obstacles seen in the caselaw being personal knowledge and hearsay.

Moreover, whenever the adverse party seeks to use portions of a 30(b)(6) deposition, Rule 32(a)(6) provides that “any party,” including the designating corporation “may itself introduce any other parts” of the same 30(b)(6) deposition.  In that situation, the corporation has free reign to introduce any otherwise admissible portions of the same deposition.  E.g., Gustilo v. Hennepin Healthcare System, Inc., 2025 WL 1639689, at *3 (D. Minn. June 10, 2025) (under Rule 23(a)(6), the corporation “may itself introduce any of its counter-designations, regardless of any fairness consideration”).

We caution, however, that corporations seeking to use their designees as live witnesses at trial should consider that doing so may expose that witness/designee to cross-examination about anything in the prior 30(b)(6) deposition, regardless of personal knowledge.

Although there is no rule requiring that the corporate designee testify “vicariously” at trial, as distinguished from at the rule 30(b)(6) deposition, if the corporation makes the witness available at trial he should not be able to refuse to testify to matters as to which he testified at the deposition on grounds that he had only corporate knowledge of the issues, not personal knowledge.

Brazos River Authority v. GE Ionics, Inc., 469 F.3d 416, 434 (5th Cir. 2006).

Another subsidiary point that came up in our research is that a party cannot both use a designee’s 30(b)(6) deposition transcript and also call the same person as a live witness.  E.g., Martinez v. Continental Tire, LLC, 2022 WL 2788068, at *2 (D.N.M. July 16, 2022).  With the same witness appearing live, the deposition, generally speaking, becomes hearsay.

Thus, it appears that Rule 32(a)(3) does not impose any additional implicit obstacle to a corporation’s subsequent reliance on the testimony of its own 30(b)(6) witnesses.  To the extent the same testimony would be admissible when offered by a non-designee, it is also admissible when given by a 30(b)(6) corporate designee.

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We almost never post on securities decisions, but we’re making an exception today. Our readers know that the initiation of MDLs and state court coordinated proceedings—often loaded with unvetted and bogus claims—can drive down defendants’ stock prices. When that happens the plaintiffs’ class action bar swoops in and files securities class actions, essentially trying to make the same defendant pay twice for the same claims.  Call it the “unholy alliance.” Today’s decision (another one arising out of the Zantac litigation) is notable because it strikes directly at the linkage between mass torts and the securities class actions that try to play piggyback.  In Roofers Loc. No. 149 Pension Fund v. GSK PLC, 2026 U.S. Dist. LEXIS 44087 (E.D. Pa. March 4, 2026), the information contained in mass tort filings and accompanying discovery were enough to bar the securities class action based on the statute of limitations.

Continue Reading Untimely Piggybacking
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Revenue” Never Actually Received

Today’s guest post, by Reed Smith’sPaul Melniczak and Erin Apsokardu, is a little different.  It’s not about product liability, but rather about a state tax issue with the potential for saving drug companies substantial sums.  Since a dollar is a dollar, whether it is saved from bogus product liability actions or unnecessary tax payments, we were happy to have them tell our readers about it.  As usual our guest posters are 100% responsible for what follows, deserving of all the praise (and any blame) that their work deserves.

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Imagine browsing the electronics section of your favorite retailer and spotting a tablet originally priced at $99, now marked down to $59. You take it to the register, and the cashier rings you up. The tax gets calculated on $59, right? You’d be shocked if the store tried to collect tax on the original $99 sticker price you never actually paid.

Pharma chargebacks are no different, or at least they shouldn’t be.  If a pharma company makes a sale to a distributor with a wholesale acquisition cost (WAC) or “sticker price” of $99, but the distributor ultimately sells the product to a drugstore or healthcare provider for only $59, the pharma will offer a $40 price reduction to the distributor known as a chargeback. Ultimately, the distributor only owes the discounted price, not the WAC.

The notion that taxes should be based on the amount actually received, not some hypothetical list price, is driving a major state tax dispute involving several pharma companies in two states: Ohio and Washington. These issues should be on your radar if your company is making material sales into either state.

Why Ohio and Washington?

Most states tax pharmas and other businesses at the income level, just like the IRS, in which case it’s undisputed that chargebacks would naturally reduce a company’s taxable income.  Ohio and Washington are among the few states that broadly impose taxes based on all “gross receipts” with minimal deductions, rather than net income or profit.  Both states’ taxing authorities have taken the aggressive position that the WAC is somehow a “gross receipt” for a pharma company, even though it doesn’t actually have a contractual right to the WAC from the distributor.  Those states take the same position for other price reductions and rebates, such as Medicare, Medicaid, and Managed Care rebates.  In short, they charge real taxes on phantom receipts.

Returning to our store analogy: the states’ positions are akin to requiring the retailer to charge tax on the $99 sticker price rather than the $59 actual price paid.  That position is not supported by the statute or other guidance in either state, and many pharmas are pushing back. 

What This Means for Your Company

Fighting back against the state’s position can take two forms:

  • If a pharma followed the taxing authorities’ position and paid tax on the WAC on its original tax returns, it can file a claim with either state requesting a refund of the overpaid tax.  Ohio and Washington both allow taxpayers to go back up to four years to claim a refund.
  • If a pharma paid tax only on the amounts received after chargebacks, and received an assessment from either state, it can appeal that assessment and make the legal argument that only the actual sales price received is subject to tax.

In either posture—either refunds or assessment appeals—the vast majority of state tax disputes can be resolved without the need for formal litigation.  Resolution by negotiated settlement is always an option.

Next Steps to Consider

Evaluate your company’s state taxation history to determine whether a material amount of tax was paid in both states on the entire WAC amount (including chargebacks and other rebates).  If not, determine whether either state has assessed unpaid taxes on this basis.  If so, consider requesting a refund or appealing the assessment.  Given that the four-year statute of limitations for refunds is running, acting sooner will preserve the company’s rights to the largest available refund.   

Just as you wouldn’t pay sales tax on a price you never paid at the register, your company shouldn’t pay gross receipts tax on amounts it never received.

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A chunk of our family recently relocated to Indiana, a lovely state that spawned prominent Americans such as Orville Redenbacher, Eli Lilly, Larry Bird, David Letterman, Michael Jackson, and James Dean, and that possesses fine covered bridges, a suddenly fearsome college football team, and a remarkable library that houses, among other things, the original manuscripts of the James Bond novels. We are planning a visit soon. That would be a pleasure, not business trip.  We wish we had more business trips to the Hoosier State, because the judiciary there seems uncommonly reasonable. 

Take, for example, the recent case of Waggoner v. Anonymous Health System, Inc., et al., 2026 WL 607352 (Indiana March 4. 2026), a defense-favorable Indiana Supreme Court decision on PREP Act (and an Indiana statutory analogue) preemption.  

The facts of Waggoner are strange and sad. The plaintiffs’ decedent had to be “medically paralyzed” to permit mechanical ventilation and prevent death from severe COVID-19, but developed a bed sore that, according to the plaintiffs and their expert, was the ultimate cause of death. 

The plaintiffs brought a medical malpractice claim against over eighty health care providers.  The trial court determined that the defendants were shielded by the federal and state immunity statutes. Why? The trial court found that the decedent’s health “care arose from the COVID-19 emergency, even though he received some care after the state-emergency order expired.”  Accordingly, the trial court granted summary judgment in favor of the defendants. 

But in an interesting twist, the plaintiffs obtained in the intermediate appellate court a reversal based on an Indiana medical malpractice tort reform statute, intended to protect health care providers. Under the Indiana Medical Malpractice Act (MMA) (similar to medical malpractice statutes in other states, though perhaps a bit stronger than most) a medical-review panel typically must first “render an opinion on a claimant’s proposed complaint before the claimant can sue a health-care provider in court.” The plaintiffs cleverly deployed the MMA as a shield against both Indiana and PREP Act immunity. How? The plaintiffs claimed that because they alleged that death was caused by the bed sore, not COVID-19, PREP Act preemption could not be addressed by the court until a medical malpractice panel decided causation.  The intermediate court bought that argument. 

But not the Indiana high court. The immunity issue here was legal, not factual. All that was required was that the death was caused by medical treatment for COVID-19, and that fact was undisputed.  Thus, concerning preemption, there was nothing for a medical malpractice panel to decide.  Whether the bed sore rather than COVID itself was the ultimate cause of death was inconsequential to the immunity analysis. The claims were plainly preempted, both under the PREP Act and under a parallel Indiana COVID immunity statute, since the bed sore arose from the decedent’s paralysis induced by COVID treatment.  The decedent “would not have developed the bed sore in the first place had he not developed COVID-19 and needed the assistance of a ventilator.”  

The plaintiffs mounted some decent arguments against preemption. That is to say, the arguments were not frivolous. But neither were they winners. First, the plaintiffs focused on chronology.  But the state act applied even though rescinded before the death because the relevant care occurred before recission.  

Second, immunity would be called off under the Indiana statute if the medical care rendered was not merely negligent but was grossly negligent. But the plaintiffs had no factual support for their belatedly raised gross negligence claim.  

In any event, even if the plaintiffs could nibble away at state statutory immunity, their lawsuit was still blocked because the federal PREP Act also preempted these claims. The plaintiffs’ arguments against state immunity had no application to PREP Act immunity.  The ventilator, the use of which led to the bed sore, was a “covered countermeasure” under the federal statute. All the defendants were “covered persons” providing COVID treatment.  The bed sore was part of a “chain of events” that “cannot be separated from the administration of a covered countermeasure.”  

Just as the plaintiffs invoked gross negligence in an effort to skirt Indiana statutory immunity, the plaintiffs invoked “willful misconduct” to skirt federal immunity. But the plaintiffs did not bring a willful misconduct claim under the PREP Act, only a state-court medical malpractice claim, and never sought PREP Act compensation, which is a prerequisite to such a claim.  

Thus, the Indiana Supreme Court reversed the intermediate court, and held that the trial court had not erred in granting summary judgment to the healthcare providers.  Waggoner is yet another sound ruling from an Indiana court.  As the great Indiana-born author Kurt Vonnegut, Jr., often wrote, “And so it goes.”

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When we last checked in on the Taxotere MDL back in January, we described the court’s brand and generic preemption rulings as chronological, not contradictory. At the time, that seemed like the most charitable reading.

The court had concluded that certain medical literature—the 2003 and 2006 studies—qualified as “newly acquired information” for the brand manufacturer because those studies post-dated FDA approval of the brand drug in 1996. But the same studies could not be “newly acquired” for the second-generation manufacturers whose products were approved through §505(b)(2) applications in 2011. By then, the court reasoned, the FDA would have already been aware of that literature when it approved the later labels. Same studies, different regulatory timelines, different answers.

Hence our earlier conclusion: chronological, not contradictory.  Well… maybe not.

The brand manufacturer has now asked the court to certify the denial of its summary judgment motion for interlocutory appeal. In re Taxotere (Docetaxel) Eye Injury Products Liability Litigation, 2026 WL 568606 (E.D. La. Feb. 27, 2026). Under 28 U.S.C. § 1292(b), certification requires three things: a controlling question of law, substantial ground for difference of opinion, and a likelihood that an immediate appeal would materially advance the litigation. Id. at *4.

Preemption easily checks the first and third boxes. It is plainly a controlling legal issue, and if the Fifth Circuit reverses, most—if not all—of this MDL disappears. That certainly counts as “material advancement.” Id. at *5. The real fight was over the second requirement: whether there is a substantial ground for difference of opinion.

The brand manufacturer argued that there is because the court’s own decisions create a logical problem. The key point is that the FDA approved the §505(b)(2) products in 2011 with labels containing warnings identical to those approved for the brand product in 2002/2003. And now we understand why the brand manufacturer was likely jumping up and down when it read the court’s generic decision.

Approval of identical warnings undermines the court’s earlier conclusion that the 2003 and 2006 studies constitute “newly acquired information.”   To qualify for a CBE label change, information must not only be “newly acquired,” it must also reveal risks of a different type or greater severity or frequency than previously known at the time of approval. Therefore,

if the 2003 and 2006 Studies did in fact present additional risk information that was not adequately captured by the 2003 labeling, then the FDA could not have approved the 505(b)(2) applications without requiring revised warnings.

Id. at *6.

Or put more simply–if those studies really revealed risks significant enough to justify a CBE label change, the FDA presumably would not have approved identical warnings eight years later in 2011.

The court expressed some skepticism about the argument but ultimately concluded that the Fifth Circuit has not addressed how, if at all, the subsequent approval of another manufacturer’s drug affects the preemption analysis. Id. at *8. That uncertainty was enough. The interlocutory appeal is certified.

So, while the court’s two decisions may not technically contradict each other on the timing question of when information becomes “newly acquired,” they sit in some tension on the different, but equally important, question of whether those studies revealed materially new risks that would support a label change in the first place.

If you are wondering why the FDA’s subsequent approval of identical warnings is not also “clear evidence” that the agency would have rejected a labeling change by the brand manufacturer (which would independently preempt plaintiffs’ claims), there is a simple answer–the defendant did not raise that argument in its summary judgment motion, so the issue was not before the court.

For now, then, the focus shifts to the Fifth Circuit and the timing question. But depending on how things unfold, defendants may have a decent “clear evidence” argument waiting in the wings if this litigation heads into round two.

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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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