The Eleventh Circuit’s recent decision in Rosell v. VMSB, LLC, ___ F.4th ___, 2023 WL 3398509 (11th Cir. May 12, 2023), has nothing whatever to do with prescription medical product liability litigation, but defense counsel should know about it because is rejects one trick that plaintiffs in complex litigation use to claim appellate jurisdiction. Specifically, it rejects the concept of “partial dismissal” under Fed. R. Civ. P. 41(a), as a tool to create a final appealable order following partial dismissal of an action.Continue Reading Plaintiff Cannot Create Appellate Jurisdiction Through Partial Dismissal
Montana Enacts Product Liability Tort Reform (And Bans TikTok)
Montana became the first state to ban TikTok this month. You no doubt have seen the press and have read the spirited discussion condemning foreign spies on the one hand and championing First Amendment rights on the other. Litigation has already commenced. But, while all that was developing, you may have overlooked that Montana also enacted a number of tort reform laws that garnered much less attention. Earlier this month, Montana passed a law allowing for greater transparency in litigation financing, a topic we have followed for years (including recently here). Montana has also limited third-party bad faith lawsuits against insurers, which even plaintiff-friendly California banned more than 30 years ago.
We will focus on the new Montana law that is directly in our wheelhouse—reform of product liability lawsuits. On May 4, 2023, Montana’s governor signed Senate Bill 216 into law, and it enacted a number of measures intended to restore some balance to product liability lawsuits in Big Sky Country.
As we read it, SB 216 provides for six significant changes:
First, the law expands Montana’s relatively complex comparative fault regime in a number of ways. It expressly allows a defendant in a strict liability or breach of warranty case to assert that the plaintiff’s damages were caused by a person whom the plaintiff has released from liability. Montana law already held that triers of fact must consider released or settled parties when apportioning fault. That requirement, however, was limited to negligence claims. It now applies to all product liability claims, including those sounding in strict liability and breach of warranty. The law also expressly states that a defendant can raise the plaintiff’s contributory fault, regardless of the legal basis, and the negligence or fault of others.
Second, the Montana law reaffirms that unreasonable misuse of the product is a defense. More significantly, however, it now defines “unreasonable misuse” to include use of the product in a manner that contravenes warnings or instructions appearing on or with the product. In other words, failing to heed warnings or instructions when you should have known about them is now per se “unreasonable misuse” and potentially a complete defense.
Third, it is a defense now in Montana that a product or its labeling could not have been made safer by the adoption of a reasonable alternative available at the time the product was first sold. This is an affirmative defense, so presumably it will be the defendant’s burden to show the absence of a reasonable alternative. We would prefer that it were the other way around, i.e., that the plaintiff has to prove the existence of a reasonable alternative, which is the law in a number of states. Exactly how Montana courts will assign the burden in practice remains to be seen.
Fourth, the Montana law enacts a ten-year statute of repose running from the date the product was first sold or leased to any person. There are, however, a number of twists. The statute of repose is tolled if the defendant seller knowingly or negligently concealed a defect or unsafe condition and the concealment caused the injury. The statute of repose also does not apply if the product is subject to a government-mandated, safety-related recall, so long as the plaintiff’s lawsuit is related to the reason for the recall. This last provision will have little impact in the drug and medical device world, where the vast majority of recalls are voluntary, and not ordered by the FDA. Still, the requirement that the lawsuit relate to the reason for the recall is welcome.
The statute of repose does not apply where the product “causes a respiratory or malignant disease with a latency of more than 10 years,” which we will call the “asbestos exception.” Finally, if the seller has warranted or advertised that a product will last for longer than ten years (“guaranteed to last 15 years, or your money back!”), a plaintiffs has until two years after that time period expires to sue, so long as nothing else (such as the statute of limitations) otherwise bars his or her suit.
Fifth, the Montana law creates a qualified safe harbor for regulatory approval and compliance. Specifically, where products have complied with safety-related regulations or were approved for sale by the government, the Montana law creates a rebuttable presumption that the products are not defective and that the manufacturers of the products were not negligent. This is a big change, because Montana had been one of only two states (the other being Pennsylvania) where compliance evidence was inadmissible in strict liability actions if offered by defendants.
Now, Montana juries must be instructed on the rebuttable presumption of no defect and no negligence where: (a) the product and its labeling complied with relevant mandatory safety rules applicable at the time of manufacturer; (b) the product gained premarket licensing or approval and the seller complied with all agency requirements; or (3) the product was a drug or medical device “approved for safety and efficacy” by the FDA and was in compliance at the time it left the seller’s control and was not recalled or withdrawn. We like that Montana expressly applies the presumption of no defect and no negligence to drugs and medical devices, but we can foresee disputes over the meaning of “approved for safety and efficacy.” We can also foresee Buckman-style preemption coming into play if a plaintiff contends that a drug or medical device was not in compliance because the defendant defrauded the FDA. Even where the presumption of no defect and no negligence applies, it is rebuttable—although with the burden presumably fixed firmly with the plaintiff.
Sixth, the new law attempts to provide protection for retailers, who usually have nothing to do with a product’s design, manufacture, or labeling and are often included in lawsuits only to defeat diversity of citizenship. On the plus side for retailers, the Montana law states that a plaintiff cannot bring a product liability action against a retailer unless there is an independent basis to do so—i.e., the retailer actually had some control over the product’s design, assembly, packaging, etc.; the retailer altered or installed the product; or the retailer made a separate warranty. These provisions all make sense, but they are weakened by what follows. A plaintiff in Montana can still sue a retailer for product liability where the product manufacturer cannot be identified, is not subject to personal jurisdiction, or is bankrupt and judgment proof—potentially converting retailers into insurers for reasons that we cannot articulate. The exception for lack of personal jurisdiction is particularly perplexing because it seemingly applies even if the plaintiff has sued the manufacturer somewhere else. Finally, the statute also preserves a claim against a retailer who had “actual knowledge” of the defect that caused the plaintiff’s injury and sold the product anyway.
The Montana law was effective on passage, and it applies to claims that accrue on or after that date. We will see how this plays out, but are encouraged.
Mifepristone Manufacturer Wins First Round in West Virginia
Over the past few months, Bexis, with the substantial help of several Reed Smith associates, has prepared a law review article – “Federal Preemption and the Post- Dobbs Reproductive Freedom Frontier” – which will soon be published in the Food & Drug Law Journal. A draft of this article is now available on SSRN.
The core premise of Bexis’ article is very simple: Once the FDA has said “yes” and approved a particular drug for a particular indication (“intended use”) for sale in the United States, federal preemption precludes any state from saying “no” and trying to ban that same FDA-approved drug. It doesn’t matter whether that drug is morphine, methadone, minoxidil – or mifepristone.Continue Reading Mifepristone Manufacturer Wins First Round in West Virginia
A Forum-Shopping Plaintiff Can Be Transferred Out Of Her Home District
After recent posts on the AHM (or Hippo) litigation, we read the excellent FDA reply brief and considered yet another post on the subject. With the oral argument before the Fifth Circuit yesterday and more briefs and decisions to come, we elected to deal with a topic that was not quite so weighty. In some ways, you cannot get much farther from the issues in medication abortion litigation to a decision on transfer of venue in serial litigation over the labeling of certain over-the-counter medications. In other ways, the issues overlap quite a bit. Venue can really matter. Getting before the particular district judge who decided AHM—instead of any of the other 672 district judges in the country—was surely part of the plaintiffs’ strategy in AHM. If that case had been transferred to the District of Maryland, where APA challenges to FDA actions are usually decided, then we might have expected very different district court rulings and a very different panel in the Fourth Circuit for any appeal.
Plaintiffs in consumer fraud cases, like in product liability litigation, surely try to game where their cases are heard. In addition, while state law claims in consumer fraud cases about FDA regulated medical products can run smack into preemption and the AHM case involved only federal law “claims,” both hinge on invalidating or ignoring FDA decisions. (We could go a step further and note the big FDA news from last week relates to the possibility that progestin-only oral contraceptives will become available OTC. Although progestin-only hormonal contraceptives have not been the subject of as much product liability litigation as combination hormonal contraceptives, OTC availability will surely spawn a range of litigation.)
Meza v. Procter & Gamble Co., No. EDCV 23-91 JGB (SHKx), 2023 WL 3267861 (C.D. Cal. Apr. 27, 2023), is one of a number of challenges to labeling certain OTC medications as “non-drowsy.” We have written on how one of these resulted in express preemption because the monograph called for labeling that was different than what the plaintiff urged. Meza involved a well-known family of OTC cold, cough, and flu products that contain the same cough suppressant, dextromethorphan. Apparently, one particular plaintiff firm has been filing and dismissing cases around the country that assert the same basic claims against the manufacturers of any “non-drowsy” OTC medications containing dextromethorphan. We have been fighting against and writing about litigation tourism for a really long time, but we can say this litigation as a whole entails some of the most blatant forum shopping we have seen. So blatant, in fact, that a case was transferred from the district (the division within the district, even) where the plaintiff lives and bought defendant’s product to the district where the defendant is headquartered. That is not something you see every day.
Meza sought class treatment—nationwide and state-specific—for people allegedly duped into purchasing these well-known products because the labeling said “non-drowsy,” even though it also said “may cause drowsiness.” (We suspect that most people who shop for cold and cough medication have an understanding that the “nighttime” versions have antihistamines and the “daytime” or “non-drowsy” versions do not. A similar percentage of potential purchasers probably also knows that dextromethorphan can make you pretty loopy, especially if you exceed recommended doses—see the opening scene in Stripes.) One thing refreshing about the treatment of venue in Meza is that the court properly focused on the plaintiff’s counsel, which had brought more than a dozen similar class actions around the country, rather than the plaintiff, who they apparently recruited so that they could bring Meza where they brought it. This is clearly one of those situations where the focus on the plaintiff’s counsel as decision makers and actors provides a better picture of what is really going on.
What was going on was that Clay, a similar case against this defendant, was brought by these lawyers in the SDNY in 2021, but was dismissed right after these lawyers dropped the appeal of the preemption decision from the same district that we mentioned above. A few days after that, Meza was filed in the same district where a judge had previously rejected preemption in a similar case these same lawyers had filed against another defendant. In fact, the Meza plaintiff purchased defendant’s product within the district after the dueling decisions had come down. The plaintiff lawyers had a similar case against yet another defendant in the SDNY dismissed when the judge followed the prior SDNY decision over the CD Cal decision. Rather than move to dismiss Meza, the defendant moved to change venue to the Southern District of Ohio. While that was pending and soon after the second SDNY decision, the Meza plaintiff amended her complaint in an attempt to stick in the CD Cal and avoid preemption. Got it?
The rules for transfer of venue under 28 U.S.C. § 1404(a) are somewhat fuzzy and within the discretion of the district court. There is also an inference that the plaintiff’s choice of forum holds absent a strong showing to the contrary. 2023 WL 3267861, *3. However, there is a growing body of law that “forum shopping” is a good reason to reject plaintiff’s choice. Id. The trick is to distinguish what is forum shopping from what is a legitimate choice of forum. In our experience, litigation tourists stand out like, well, tourists and should be subject to transfer of venue under 1404 if they are not dismissed for lack of personal jurisdiction. Even when the same named plaintiff is not bouncing around between courts, there can be “an equally strong inference of forum shopping when parallel actions are filed by the same law firm, and such strategic machinations by plaintiff’s counsel are equally discouraged under Section 1404(a).” Id. at *4. Rather than deny that the case was essentially refiled with a different purported class rep to avoid an adverse ruling in the SDNY, plaintiff’s counsel argued that the inclusion of California state consumer protection claims (instead of New York consumer protection claims) made Meza different than Clay. The Meza court rejected plaintiff’s argument, noting that “the core allegations in this action are copied and pasted verbatim from the complaint in Clay,” that the “substance of the lawsuits appear to be identical,” and that “[c]ases need not be identical for a court to draw an inference of forum shopping from them.” Id. Plaintiff’s counsel had also voluntarily dismissed at least five other cases against other manufacturers of “non-drowsy” products in response to motions to dismiss. Id. at *5. In addition, even though plaintiff’s counsel maintained two other “non-drowsy” SDNY cases after the first preemption ruling, the Meza court saw this as “judge shopping,” which was just as bad.
Plaintiff’s response was essentially the schoolyard response: “no, you are the forum shopper.” The defendant had not sought to change venue in Clay and it had an adverse ruling in the CD Cal that would be worth avoiding. However, the Meza court rejected that argument, because the defendant did not have evidence of plaintiff’s counsel’s forum shopping before the dismissal in Clay and it was seeking transfer to its home district, not to the SDNY. Id. Altogether, there was clear evidence that plaintiff’s counsel was forum shopping and, “since this is a putative class action, and a nationwide one at that, the Court defers even less to Plaintiff’s chosen forum.” Id. at *6. Thus, transfer “would serve as a useful deterrent to Plaintiff’s forum shopping.” Id. The other factors, which generally weighed in favor of transfer, largely involved case-specific evaluations that are less interesting to the larger issues here. However, the fact that plaintiff sought a nationwide class action—and she had purchased the defendant’s products so she could replace a prior purported class rep—weighed against there being greater ties between the parties and the CD Cal than between the parties and the SD Ohio. Id. at *7-8. So, the case was transferred to the SD Ohio, where absent another voluntary dismissal there will likely be a ruling on a motion to dismiss based on preemption.
If you are like us, then you might be wondering how these plaintiff lawyers get away with all of these dismissals without prejudice after the defendant has filed its motion to dismiss, among other things. Well, there is a bit of a loophole in Fed. R. Civ. P. 41. Until the defendant has answered or moved for summary judgment, the plaintiff can voluntarily dismiss without prejudice without the defendant’s agreement, the court’s permission, or any payment of the defendant’s fees. A motion to dismiss does not count, and many defendants will move to dismiss on preemption up front, and without an answer or any discovery, to help reduce the costs of litigation. When this happens, the plaintiff lawyers can play the games described above. However, defendants should not forget about the option to seek costs of the prior action “[i]f a plaintiff who previously dismissed an action in any court files an action based on or including the same claim against the same defendant.” Fed. R. Civ. P. 41(d). While this only applies if it is the same plaintiff, nothing deters this version of forum shopping quite as much as footing the defendant’s bills.
Presidential Pardon Does Not Undo Criminal Conviction or Support Corporate Indemnification
We have a weak spot for criminal cases. We also have a weak spot for doom-scrolling, inevitably provoked by the country’s insane politics over the last eight years. And we have a weak spot for visiting nearby Delaware, home of tax-free shopping, excellent beaches, Dogfish Head Brewery, and judges who know corporate law. We live in one of those “tri-state areas,” and if we were presented with a choice of being before a judge in Pennsylvania, New Jersey, or Delaware, our first choice would be the First State. Delaware judges usually get to the heart of the matter, interpret statutes correctly, and seldom engage in fantasy. Perhaps you noticed how a Delaware judge recently steered a very high profile case toward settlement by issuing no-nonsense rulings. We’ve been in that same judge’s courtroom. He is lightning smart and wastes zero time.
So imagine our giddiness when Bexis flipped us a Delaware Chancery Court case involving a criminally convicted drug executive who sought indemnification from his former company based on a pardon from former President Trump. Intermune, Inc. v. Harkonen, 2023 Del. Ch. LEXIS 108 (Del. Chancery Ct. May 10, 2023), is a legal-political-corporate feast. The judge was really cooking. Bring a big spoon and wear a bib.
In Intermune, the plaintiff was a drug manufacturer. Thus, as far as we’re concerned, we’re already in man-bites-dog territory. But the drug company was not looking to bite a dog; it was looking to bite its former CEO. More specifically, the company was looking to take a bite out of the former CEO’s claim for indemnification. Sit back and enjoy this odd tale. In 2009, a federal jury found beyond a reasonable doubt that the CEO acted with intent to defraud when he directed his company to issue a “false and misleading press release [in 2002] about the results of one of the Company’s clinical trials.” (Bexis wrote about this criminal case here.) The company and its insurers had advanced the CEO’s defense costs. After the CEO was convicted, the insurer demanded its money back from the company, invoking a policy exclusion for crimes involving intentional fraud. The company refused, the dispute went to arbitration, and the insurer won. Now the issue was between the company and the CEO as to who was on the hook for the CEO’s defense costs. The CEO claimed that under Delaware law, the company was required to indemnify him. The company filed an action for a declaratory judgment that the former CEO was not entitled to indemnification. The parties then filed cross motions for summary judgment and the issue was packaged neatly for the court.
Or was it really so neat? There was a long lead up to this case. The former CEO had litigated his conviction for nine years, all the way to the Supreme Court, and lost every time. Let’s list the losses:
- the jury found the CEO guilty,
- the trial court denied his motion for acquittal,
- the trial court denied his motion for a new trial,
- the appellate court denied his direct appeal,
- the former CEO lost a petition for writ of error coram nobis,
- he lost a collateral appeal, and
- his two petitions for a writ of certiorari to the U.S. Supreme Court were denied.
The legal system had not treated the former CEO kindly. But the political system rode to the rescue. On January 19, 2021, on the next to last day of the Trump presidency, the former CEO received a Trump presidential pardon. Such a pardon, of course, qualifies as a Very Big Deal. You might even say it was Huge. But did it make any difference under Delaware law regarding corporate indemnification? Section 145(c) of the Delaware General Corporation Law provides that a corporate officer is entitled to indemnification if he was “successful on the merits or otherwise.” Did the presidential pardon make the former CEO successful? The court in Intermune answered with a resounding No. A presidential pardon does not eliminate a conviction, or erase guilt, but only restores all “basic civil rights” that the conviction had taken away. Further, indemnification of legal expenses is not a such “basic” civil right. Moreover, as the court reasoned, “even if, somehow, corporate officer indemnification qualified as a corporate civil right restored by a federal pardon, [the CEO] never lost it because he never had it.” Nor is a pardon an adjudication of innocence. The pardon arrived with a letter from the U.S. Pardon Attorney. That letter explained that, “although full and unconditional,” the pardon did not “erase or expunge” the CEO’s conviction or “indicate his innocence.” The CEO was convicted; he did not “succeed.” Getting a pardon is not “success,” at least not in the sense relevant under section 145(c). As the Intermune court explained, “convictions do not constitute success, on the merits or otherwise. The Pardon did not overturn [the CEO’s] conviction. End of story.”
Well, it was not quite the end of the story. The former CEO had another argument in support of indemnification, though it was equally devoid of merit. The former CEO contended that indemnification should be interpreted broadly in his favor, and that he should be permitted to relitigate the issue of whether he had acted in good faith in issuing the press release. The CEO asserted that certain post-conviction events, including the position the company unsuccessfully took against the insurer, supported his claim of acting in good faith. The Intermune court reasoned that section 145 incorporated preclusion principles. Bad faith was an element of the crime for which the CEO was convicted. The conviction actually decided the issue of good faith, and the CEO had a full and fair opportunity to litigate his intent. By this point, the Intermune court counted up the number of times the CEO had litigated intent, and the result was impressive: “[The CEO] litigated intent at least ten times. Adding the insurance arbitration brings the figure to twelve. The quasi-legal memorandum makes thirteen. … [The CEO] seeks to use this proceeding as a fourteenth opportunity to relitigate his state of mind. But there is nothing new.”
What about the company’s earlier arguments against the insurer? The CEO said that the company “admitted” during the parties’ insurance arbitrations that he “acted with an indemnifiable state of mind.” The Intermune court disagreed. First, the company’s arbitration position in favor of indemnification was not a “concession of fact.” Second, “[u]nder Section 145, [the CEO’s] conviction is what matters, not what the Company once thought about it.” Third, the CEO’s argument runs afoul of Delaware law’s preclusion of corporate indemnification of “crimes committed with bad faith intent.” The CEO might genuinely disagree with his conviction, but such disagreement does not permit him “to redo his prosecution.”
Implied Preemption and A Lack of Evidence Strips Plaintiff’s Case Under Nebraska Law
Today’s case is Thelen v. Somatics, LLC, 2023 WL 3338221 (M.D. Fla. May 5, 2023). It is a straightforward products liability case involving a medical device used in electro-convulsive therapy. Plaintiff alleges the device caused a permanent neurological injury, memory loss, and brain damage and that the manufacturer is liable for failure to warn, design defect, manufacturing defect, and breach of express warranty under Nebraska law. Defendant moved for summary judgement, and while certain of defendant’s arguments were not adopted by the court, in the end plaintiff was left with only a portion of his failure to warn claim.
The court found there were genuine factual disputes as to the statute of limitations, id. at *2, and whether the learned intermediaries had independent medical knowledge of the alleged risks. Id. at *3. The court also determined that plaintiff had admissible expert evidence on both general and specific medical causation. Id. at *3-4. But, on the individual claims, plaintiff’s path to trial was full of hurdles he could not overcome.
On his negligent failure to warn claim, plaintiff alleged that defendant failed to adequately investigate reports of serious adverse events, failed to report adverse events to the FDA, and violated FDA’s reporting and record keeping requirements. The court found the latter two preempted. The duty to report to the FDA is a duty that runs to the FDA. It is not a duty owed to plaintiff under state law. Id. at *5. On that basis, the court distinguished an alleged failure to investigate as a duty grounded in state tort law, not dependent on any federal requirement.
Plaintiff’s remaining three claims were all dismissed in their entirety. Plaintiff alleged a manufacturing defect claim but adduced no evidence that the device used to treat him deviated from the device’s intended design or specifications. On breach of express warranty, plaintiff pointed to statements made on defendant’s website, but neglected to provide any evidence that anyone relied on those statements or even looked at the website. Absent reliance, that claim also failed. Finally, Nebraska applies the “consumer expectations” test to claims for design defect – is the product more dangerous than the ordinary consumer would anticipate. Plaintiff argued that the relevant consumers are patients, not physicians and the court agreed. However, plaintiff offered no evidence to establish the expectations of the ordinary consumer. Plaintiff offered only his own expectations, “which may or may not reflect the ordinary knowledge common to the community.” Id. at *6.
Overall, defendant won more than it lost and plaintiff is left with only a part of his warning claim to take to trial.
Two New Appellate COVID-Related Developments
Each of these cases is significant enough to merit its own post, but since they came down within a week of each other, we’re discussing both of them here. They are: Gahl v. Aurora Health Care, Inc. ___ N.W.2d ___, 2023 Wisc. LEXIS 137 (Wis. May 2, 2023), and M.T. v. Walmart Stores, Inc., ___ P.3d ___, 2023 WL 3135662 (Kan. App. April 28, 2023).Continue Reading Two New Appellate COVID-Related Developments
Ninth Circuit: Call a Spray a Spray – Butter Substitute Labeling Claims Preempted by the FDCA
We start with the usual poodle report – actually with a comment that these may be drawing to a close, as Luca is only a few points from finishing his championship and coming home. We suspect this will cause little grief for readers of this blog (the Drug and Device Law Rock Climber and other family members and close friends long ago reached their “Luca talk” saturation point), but we have appreciated this outlet for our excitement about this unexpected adventure and our pride in our beautiful baby boy.
We will celebrate Luca’s final victories as we did his last, with an order from the new takeout cookie bakery that has appeared in our neighborhood shopping center. And this bakery provides our typical rickety bridge to today’s case. We read the nutritional information for the warm peanut butter cookie (roughly the size of a hubcap) studded with chunks of peanut butter cups – 180 calories per serving! Not bad, right? But readers of this Blog, and the author of this post, are smart enough to know that the line below the calorie count is the most important: four servings per cookie. Today’s case is about a butter substitute spray, not about cookies. But the plaintiffs/appellants disclaimed the intelligence to understand the relationship between serving size and calorie count and asked the court to require the spray’s manufacturer to slather on far more label information than the FDA required. The claims were preempted, of course. But we get ahead of ourselves.
Pardini v. Unilever United States, Inc., — F.4th —, 2023 WL 2980312 (9th Cir. Apr. 18, 2023), is a to-be-published appeal of the Northern District of California’s grant of the defendant/appellee’s Rule 12(b)(6) motion to dismiss. The plaintiffs were consumers of the defendant’s product, a “butter-flavored vegetable oil” dispensed with “pump action squirt bottles” with a “spray mechanism.” Pardini, — F.4th —, 2023 WL 2980312 at *2. As the court explained, the nutrition panel on the back of the spray bottle lists one serving size for use of the product as a “cooking spray” (1 spray = 0.20 g.) and a second for use of the product as a “topping” (5 sprays = 1 g.). Both serving sizes are listed as having no calories and zero grams of fat. The plaintiffs alleged that the entire bottle of the butter substitute spray contains 1160 calories and 124 grams of fat and claimed that, “because the [listed] serving sizes [were] “artificially small,” the product did not really have “0 calories” or “zero grams of fat” per serving. They alleged that the product’s nutrient content claims were “misleading because they [were] based on unrepresentative serving sizes.” Id. at *2-3. They argued that, for purposes of identifying the appropriate serving sizes for the nutritional information, the product should be classified in the “same product category as butter itself with a required serving size of one tablespoon, rather than as a ‘spray type’ fat or oil.” Id. at *3 (internal punctuation omitted). Obviously, in that case, neither the calorie count nor the fat gram total for a tablespoon of the vegetable oil product would be “zero.”
In the trial court, the plaintiffs “allege[d] that consumers [had] expressed confusion and frustration upon learning that larger servings of the product contain[ed] non-negligible amounts of calories and fat,” and that they would not have purchased the product, or would have paid less for it (one can only wonder how any consumer would have “paid less,” since the store price is what it is), if they had “known the true nature” of the product.” Id. They sought to certify a nationwide class of consumers. The court dismissed the claims as preempted by the FDCA, and the plaintiffs appealed.
The Ninth Circuit began its decision by commenting:
Over 125 years ago, the Supreme Court decided whether a tomato is a fruit or a vegetable (the answer: a vegetable). In a more modern iteration of this legal genre, we today decide, in effect, whether the [appellee’s product] is a butter or a spray. The question turns out to matter because the plaintiff consumers contend that the product’s label makes misrepresentations about the fat and calorie content based on artificially low serving sizes.
Id. at *1. The court went on to explain that a “vast regulatory scheme” governs food labeling, and that the FDCA expressly preempts “causes of action [that] would directly or indirectly impose nutrition label requirements different than those prescribed by federal law.” Id. at *3 (citation to Riegel omitted). Under the relevant regulations, if a product has less than five calories per serving, the calorie content may be expressed as zero calories per serving. Likewise fat content of less than five grams per serving. Because, obviously, “the larger the serving of a food product, the more calories and fat are ingested,” id. at *4, determination of the appropriate “serving size” is the tipping point of the analysis.
“Under FDA regulations,” as the Ninth Circuit explained, “the term serving or serving size means an amount of food customarily consumed per eating occasion by persons 4 years of age or older which is expressed in a common household measure that is appropriate to the food.” Id. (internal punctuation and citations omitted). Serving size is identified using national consumption data with reference to “the major intended use of the food; for example, milk as a beverage and not as an addition to cereal.” Id. (internal punctuation and citations omitted).
Within the category “fats and oils,” there are two pertinent categories: “butter, margarine, oil, shortening” (serving size one tablespoon) and “spray types” (serving size expressed in fractions of a gram and duration of spray, in seconds). So the key to deciding whether the labeling for the defendant’s product correctly identified reference serving size is the determination of whether the product is in the former or the latter category (as the Ninth Circuit said at the beginning of the opinion); in other words, whether the “should be classified as a butter/oil or a spray.” Id. at *5.
The court held, “As a matter of legal classification, it is a spray.” Id. The court explained that federal regulations are interpreted based on their plain language. It emphasized,
There is no well-pleaded allegation in the complaint that, in form and function, [the product] is anything other than a spray. Images in the complaint and record indicate that the product comes in a spray bottle, with a finger-activated pump at the top. Plaintiffs at one point in their operative complaint themselves reference the product’s ‘spray mechanism.’ They similarly describe the product as on that is ‘dispensed in pump-action squirt bottles. These allegation support [the manufacturer’s] characterization of [the product] as a spray, based on the properties of the product and the liquefied form in which it is indisputably applied.
Id. at *6. In other words, if it looks like a spray, it comes in a spray bottle, and you spray it to dispense it, it is a “spray” for purposes of the regulation. Moreover, the court commented, it would be implausible to conclude that the product could be classified as “butter, margarine, oil [or] shortening,” for which the reference serving size is one tablespoon – it would take 40 sprays to equal a tablespoon, and that is “not how such a product is typically used.” Id. So the label complied with federal law because the manufacturer properly categorized the product as a “spray type” of fat and used the reference serving size for that category. Moreover, the regulations did not prohibit the manufacturer from including the “five sprays” alternative serving size, for which the calories and fat grams were also zero.
The plaintiffs next argued that the label was misleading because people do not typically use only one spray of the product, and “serving sizes must reflect customary usage.” Id. at *7. According to the plaintiffs, this created an issue of fact because the manufacturer was required to “determine how their customers consume food products” in creating their labels. Id. The court didn’t bite, dismissing this argument as “backwards,” stating, “In a lawsuit such as this, whether the serving size listed on the nutritional label is lawful is not a factual question about consumer behavior, but rather a legal question that turns on whether the manufacturer identified the proper product category and complied with the applicable product category regulations.” Id.
The court concluded,
Because plaintiffs’ challenge to the [product’s] serving sizes would “directly or indirectly establish a requirement for food labeling that is not identical to federal requirements, the FDCA preempts their serving size claims. It follows that plaintiffs’ claims about fat and calorie content are preempted as well. . . . [I]f plaintiffs . . . believe that the FDA should not allow products to be labeled as containing zero fat or calories when a given serving size may contain some of each, they may raise the issue with the agency. This argument cannot overcome the FDCA’s express preemption provision.
Id. at *8. Dismissal affirmed.
We had a lot of fun reading and reporting this case (we rolled our eyes a lot), and we agree wholeheartedly with the Ninth Circuit’s decision. On to the weekend and its dog shows. In your leisure, raise a fourth of a cookie to our almost-champion puppy, and stay safe out there.
FDA’s Brief To The Fifth Circuit in the AHM Case Is Worth A Read
Attempting to stay up on every filing in every medication abortion case could be a full-time job these days. We have one of those already, so we tend to stick to court rulings. The filings in the Fifth Circuit on the AHM appeal are something of an exception. In addition to party briefs, the list of amici that have weighed in is long and impressive. A perusal of amicus briefs drew more than a few “they should know what they are talking about here” responses to groups of food and drug law scholars (as opposed to DDL bloggers), former FDA commissioners, former FDA officials, and former DOJ officials, among others. Of course, the current FDA, represented by the current DOJ, should also know about FDA law, FDA authority, and the history of its decisions regarding mifepristone.
As we have said, FDA is not infallible and we see where too much deference to FDA or any agency can produce some bad results and constitutional problems. However, FDA is supposed to be and, in our experience, really is the expert in evaluating whether and under what conditions a drug should be approved. More specifically, it employs a staff of subject matter experts and is not shy about enlisting outside experts, as with advisory committees, when it needs more expert firepower. Its staff has a broad view tied to public health considerations, available drug and non-drug treatment options, data that may not be publically available, and decades of experience with the subject matter. That all matters because judges lack that expertise, broad view, and experience. Second-guessing decisions made by someone with expertise you lack is a dicey proposition.
The internet and a variety of societal trends have contributed to what some have called “The Death of Expertise.” We wrote many posts about and saw many more examples of this phenomenon in connection with people following non-experts or “doing their own research” to pursue atypical “treatment” for COVID-19 and/or ascribe a wide range of “complications” to the COVID vaccines. This also includes “ology” confusion. For instance, an anesthesiologist or proctologist is not the right expert to consult for big questions about immunology, virology, epidemiology, gynecology, or cochlear implant audiology, for that matter. Rejecting the value of relevant expertise also make it much easier for personal views to predetermine the outcome of any “research” or “analysis.” There is a reason why studies should have formal protocols in place before they begin. Scientific method, the involvement of subject matter experts (e.g., a biostatistician for the stats), and efforts to maintain data integrity are among the criteria for doing good scientific research and analyzing the findings of research that has been done. People, even judges, do not like to hear it, but people can get confused and come to unsupportable conclusions when they stray beyond their own areas of competency (if any). Guidance from true experts with an interest in the truth may help, but only if you are willing to credit their expertise.
Without rehashing the analytical gaps of the decision in AHM from the Northern District of Texas and the partial stay order from the Fifth Circuit (later trumped by the complete stay from the Supreme Court), we can say that those judges did not have scientific or regulatory subject matter expertise and did not credit expertise (or discredit faux expertise) as they should have. The appellate brief from FDA bears that out well. We will not rehash the entirety of the brief, which you can see here. Each of the three arguments FDA makes for reversal relies in part on the incontrovertible facts that FDA had expertise to address the medical issues related to mifepristone and exercised its collective judgment in reaching decisions that related to its expertise. This is quite clear from the first ten pages of the brief, where there are (conservatively) eight separate references to FDA exercising its scientific judgment or utilizing its expertise to review scientific information. In other contexts, a similar recounting would support preemption, primary jurisdiction, or just plain deference. Here, even without all the legal trappings and detailed arguments, there is a sense in which this set of facts should be enough to conclude the AHM decision cannot stand within the context of a number of constitutional provisions, a bunch of federal laws, and a boatload of caselaw. As FDA wrote in its summary of arguments:
While FDA justified its scientific conclusions in multiple detailed reviews, including a medical review spanning more than 100 pages and assessing dozens of studies and other scientific information, the district court swept the agency’s judgments aside by substituting its own lay understanding of purportedly contrary studies, offering demonstrably erroneous characterizations of the record.
Brief at 16. FDA also noted that the court had relied on its “own interpretation of extra-record publications.” Brief at 12. See what we meant about the death of expertise and the likelihood that non-experts (i.e., those with a “lay understanding”) will get it wrong when they pretend to know more than the actual experts do?
In terms of FDA’s arguments, we will focus on the core standing issue and why FDA’s actions were lawful (and not arbitrary and capricious). The time-bar of the challenge to the 2000 approval of mifepristone is, as we said before, pretty obvious. Enough has been written on the district court’s resurrection and misinterpretation of the Comstock Act. In addition, the lack of a particularized injury to create standing largely determines why the district court’s granting of sweeping “preliminary relief” under the guise of 5 U.S.C. § 705 was an abuse of discretion. The core standing issue, from our perspective, is whether individual physicians who did not prescribe mifepristone demonstrated particularized injury from a violation of a legally protected interest by the specific FDA actions about which they have complained in a timely fashion. The brief does a good job of explaining why the “injuries” the physicians claim they will suffer are tied to the 2000 approval of mifepristone and not to any FDA action they have challenged in a timely fashion. Brief at 27. The FDA actions properly at issue do not affect the physicians’ legally protected interests. As Justice Kavanaugh wrote back when he was on the D.C. Circuit, complaints like these physicians’ are required by the Constitution to be directed “to the Executive and Legislative Branches, not the judiciary.” Brief at 19-20 (quoting Coalition for Mercury-Free Drugs v. Sebelius, 671 F.3d 1275, 1283 (D.C. Cir. 2012)). The standing arguments that the district court had accepted were on all fours with the standing arguments the Supreme Court rejected in Summers v. Earth Island Inst., 555 U.S. 488, 495 (2009), where it said expanding standing as proposed would “make a mockery” of Article III. Brief at 21-24.
The Fifth Circuit’s motions panel obviously came down, in that particular context, on the side of the district court on the standing issues discussed above. A few things are worth noting, though. First, as we pointed out previously, the Fifth Circuit stay order’s evaluation of standing relied heavily on arguments based on alleged impacts from 2023 FDA actions. Those should not be considered because, in addition to occurring after the suit was filed, these plaintiffs did not challenge them. Brief at 11 n.1. Second, while it cited Spokeo, Inc. v. Robins, 578 U.S. 330, 339 (2016), and Clapper v. Amnesty Int’l USA, 568 U.S. 398, 409 (2013), on the requirement of a particularized injury—but did not apply them correctly, as far as we are concerned—it did not cite Summers and account for its rejection of statistical arguments that some member of a plaintiff organization is likely to suffer a concrete injury at some point in the future. See FDA v. Alliance for Hippocratic Med., ___ F.4th ___, 2023 U.S. App. LEXIS 8898, *13-23 (5th Cir. Apr. 12, 2023). Third, FDA directly addressed some of the motions panel’s misunderstanding of the science and statistics in the record, including that “mifepristone does not exacerbate ectopic pregnancy; it simply is not effective in treating that condition.” Brief at 29. Given how overly sympathetic the motions panel was to the plaintiffs’ theorized “stress” and the possibility that they would have to face “the irreconcilable choice between performing their jobs and abiding by their consciences,” it seems that reversing on standing—at least with the initial panel—will be difficult.
In its argument that the record did not support that any FDA actions were arbitrary and capricious—as the Administrative Procedures Act requires to strike down an agency decision—FDA did argue for deference. The decisions it cited were interesting choices. Rather than Chevron, Auer, or Kisor, FDA cited the Roberts concurrence in the stay order in FDA v. American Coll. of Obstetricians & Gynecologists, 141 S. Ct. 578, 578-79 (2021), and the Fifth Circuit’s decision in Sierra Club v. EPA, 939 F.3d 649, 680 (5th Cir. 2019). Brief at 38-39. The former spoke of FDA’s “background, competence, and expertise to assess public health” in the context of mifepristone and the latter to the “evaluation of complex scientific data within its technical expertise.” As expected from the early pages of the brief, FDA also spelled out its exercise of medical and scientific judgment at each step of its evaluation of mifepristone. It also explained the relevant provisions of the FDCA and its regulations over the relevant time period, including how the district court essentially invented FDA requirements so that it could then claim FDA did not follow its own requirements—and thus acted arbitrarily and capriciously. See, e.g., Brief at 42-44 & 60-61. If you are following medication abortion litigation, then we recommend reading this section of the FDA brief to gain an understanding of how the judgment of experts was the driving force for a number of decisions that plaintiffs later challenged based on their own non-expert, personal preferences.
Speaking of preferences, any evaluation of what the Fifth Circuit will do has to look at the panel assigned to decide the merits of the appeal. When that panel was announced on Monday, we noted that two of the three judges had sat together on a panel that issued a truly bad decision last year reversing a defense verdict from the Taxotere MDL. Because the reasoning in that decision was so lacking and ignorant of rules that civil litigators ought to know, we said this:
We will deviate from our general rule of not talking about the panel, but this one was quite unusual in its composition. Although there are 26 judges on this court, all three of the judges on the panel were appointed by a recent one-term president. Only one had any prior judicial experience—a short stint on a state intermediate appellate court—and the other two were political appointees under a particular governor. Rather than speculate about the panel’s mastery of the Federal Rules of Civil Procedure, the Federal Rules of Evidence, and Louisiana product liability law, we will just speculate that just about any other panel of the Fifth Circuit would have a different perspective.
This does not leave us very hopeful about this panel and underscores how labeling a jurist “conservative” has little meaning when it comes to the issues at play in AHM. The fact remains, however, that this panel is not likely to have the last say. It may very well fall to a rehearing en banc and/or the Supreme Court—each stocked with mostly “conservative” jurists—to restore some sanity to the mad world where FDA approvals can be wiped out retroactively more than two decades later. In this case, as FDA notes, the drug at issue is one declared an “Essential Medicine” by the World Health Organization and is used in more than half of all medical interventions within its approved indication. Brief at 1. But what do all those public health experts and prescribing physicians know compared to a lay person who did his own research?
D.N.J. Dumps Diarrhea Drug Case Against Manufacturer
It is looking very much as if the U.S. Supreme Court will hear a case this upcoming October term that will permit it, at long last, to inter the Chevron doctrine. Under that doctrine, if there is ambiguity about the scope of rule making powers provided to an agency by Congress, courts will defer to the agency with respect to that scope. As a matter of separation of powers, the Chevron doctrine was always problematic. At the same time, some deference to agencies made sense because agencies possess two things that Congress lacks: expertise and energy. If the executive branch, including agencies, expanded its powers, such expansion was aided and abetted by a legislative branch that succumbed to partisan gridlock, know-nothingism, and torpor.
Preemption is not the same thing as Chevron deference. But it is also supported by agency expertise and energy. The FDA, for all of the criticisms leveled against it, has a lot of expertise and energy when it comes to approving drugs and devices. And then there is the Supremacy Clause. It is simply unworkable, even nonsensical, to permit the states to impose varying, contradictory requirements on FDA-approved products. We generally salute the concept of states as laboratories, but jury verdicts in product liability cases are often rotten laboratory experiments gone awry. As a matter of science and interstate commerce, it is well and good that FDA regulations preempt inconsistent state tort laws.
Speaking of separation of powers, now we commence another love letter to the judicial branch – specifically, a court applying preemption against a tort claim that would countermand FDA regulation of drugs. In Heslin v. New Jersey CVS Pharmacy, LLC, 2023 WL 3249820 (D.N.J May 4, 2023), the plaintiff asserted a wrongful death claim based on the decedent’s abusive overuse of a generic over the counter (OTC) anti-diarrhea medicine. The plaintiff initially filed the complaint against only the pharmacy where the decedent allegedly purchased the medicine. The plaintiff’s theory was the pharmacy should have restricted the sale of the anti-diarrhea medicine once it was on notice that some customers were buying too much. This theory sounds a bit like the opioid litigation. Hello, nannyocracy. Anyway, the pharmacy was the only, no doubt lonely, defendant for approximately 20 months, until the plaintiff got the bright idea of amending the complaint to join the manufacturer. Why leave the deepest pockets out of the party? Except it really was not such a bright idea, because the amendment ran straight into preemption. The manufacturer filed a motion to dismiss, and the court granted the motion.
The plaintiff filed two causes of action against the manufacturer under the New Jersey Wrongful Death and Survival Acts. One cause of action was for negligence and the other was for willful and wanton disregard for the manufacturer’s “invitees and customers.” The plaintiff claimed that the manufacturer failed to comply with state and federal laws, including FDA safety announcements regarding the dangers of taking too much of the anti-diarrhea medicine. What was the manufacturer supposed to do? Simply stop selling the medicine? Find a way to restrict its sale of the drug by limiting the amount that could be sold to that mentioned in an FDA safety announcement? Warn abusers to stop abusing?
The Heslin court sorted through the preemption issues in a clear, logical, and blissfully succinct fashion. The court interpreted both claims against the manufacturer to amount to failure to warn claims, violations of the Food, Drug, and Cosmetics Act (FDCA), and “failure to restrict sale” claims.
First, the warning claim against the generic manufacturer was preempted by the sameness requirement of the FDCA. The generic manufacturer must use the same label as the brand manufacturer even when its product is OTC. “The FDA’s duty of sameness preempts any state law duty that would require a generic drug manufacturer to change its label.” See Mensing.
Second, the demand that the manufacturer comply with an FDA safety announcement was a preempted private attempt to enforce the FDCA because it existed “solely by virtue” of the FDA safety announcement. There is, of course, no private enforcement of the FDCA. See Buckman. Moreover, the safety announcement did not change any of the FDA requirements regarding dosage form, strength, or labeling.
Third, the Mensing sameness requirement would extend to the manufacturer’s inability to restrict sales by changing the maximum approved daily dose. Generic drugs must have the same dosage form, strength, and labeling as the name brand versions.
The Heslin court dismissed the claims against the manufacturer with prejudice. In addition to the preemption grounds, the court also pointed out that claims that the manufacturer should have known of the particular plaintiff’s overuse, and that disregard of such fact constituted “willful and wanton” conduct, made no sense in light of the fact that the manufacturer sold the medicine to the pharmacy, not the plaintiff.
The pharmacy is still in the case. We wish the pharmacy good luck, because this case looks to us like one in which all the bad behavior was on the left side of the v.