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JAMES M. BECK is Counsel resident in the Philadelphia office of ReedSmith. He is the author of, among other things, Drug and Medical Device Product Liability Handbook (2004) (with Anthony Vale). He wrote the seminal law review article on off-label use cited by the Supreme Court in Buckman v. Plaintiffs Legal Committee. He has written more amicus briefs for the Product Liability Advisory Council than anyone else in the history of the organization, and in 2011 won PLAC's highest honor, the John P. Raleigh award. He has been a member of the American Law Institute (ALI) since 2005. He is the long-time editor of the newsletter of the ABA's Mass Torts Committee.  He is vice chair of the Class Actions and Multi-Plaintiff Litigation SLG of DRI's Drug and Device Committee.  He can be reached at jmbeck@reedsmith.com.  His LiinkedIn page is here.

Ever since innovator liability burst onto our consciousness a decade ago with the horrific decision in Conte v. Wyeth, 85 Cal. Rptr.3d 299 (Cal. App. 2008), we have had nightmares about the potential impact of this theory.  After all: (1) over 90% of all prescriptions these days are for generic drugs, and (2) plaintiffs claiming injury from generic drugs are largely prevented from suing their actual manufacturers due to preemption.  Even if generic drugs, by and large, generate less litigation per prescription than innovator drugs, due to their risks being better known over longer periods of use, imposing 100% of potential liability on less than 10% of the market, as innovator liability theories permit, would pose a massive threat to the innovator drug industry, and would send innovator drug prices skyrocketing.

Thus, we’ve manned the barricades against innovator liability since its inception.  The Blog maintains a comprehensive innovator liability scorecard, as well as an updated 50-state survey of innovator liability.  Appellate decisions on innovator liability – pro or con (thankfully, mostly con) have ranked highly on our annual top- and bottom-ten lists of the most significant cases of the year.  See 2018+1; 2018-1; 2017-1A; 2016-5; 2014+1; 2014+3; 2014-1; 2013+2; 2013-5; 2008-1.

But now we’re saying “woah,” at least a bit.  Two state high courts:  California in T.H. v. Novartis Pharmaceuticals Corp., 407 P.3d 18 (Cal. 2017), and Massachusetts in Rafferty v. Merck & Co., 92 N.E.3d 1205 (Mass. 2018), have allowed some form of innovator liability for a year or more, now.  We follow the legal press pretty closely on prescription medical product liability litigation issues, and we haven’t read anything about a flood of additional innovator liability cases – or even one − being filed in those states.  Indeed, we haven’t heard a peep out of the T.H. case itself since it was remanded after the California Supreme Court’s decision.  We checked with defense counsel, and no, T.H. hasn’t settled, but rather is proceeding towards trial in orderly fashion.

So what’s going on?  Has the existential threat of innovator liability turned into a paper tiger in practice?

We think the answer is, “hopefully.”  And that’s very good news for manufacturers of innovator drugs.  In retrospect, one of the reasons we experienced such a rash of innovator liability litigation after Mensing/Bartlett was that these preemption rulings left high and dry a lot of existing cases involving generic drugs.  In particular, the other side had been actively soliciting metoclopramide cases, so when the Supreme Court lowered the preemption boom, those lawyers were left like fish in a barrel – and innovator liability was one of the few tools at their disposal.  By now, in 2019, those metoclopramide cases have pretty much worked their way through the system.  We ran “metoclopramide” on Westlaw, and there hasn’t been a single trial court level metoclopramide decision of any sort on any topic since Raskas v. Teva Pharmaceuticals USA, Inc., 2018 WL 351820 (E.D. Mo. Jan. 8, 2018), over a year ago.

Nor has anything else significant taken the place of metoclopramide litigation.  Our innovator liability scorecard reflects only four decisions for all of 2018.  All four involved different drugs, and none was a metoclopramide case.  Entries into our generic preemption scorecard have also slowed dramatically.  Only eight cases involving generic preemption (that we’re aware of) were decided in all of 2018.  Every prior year, going back to Mensing in 2011, was well into double figures.  Nor are there really any targeted generic products any longer.  The eight generic preemption cases in 2018 involved seven drugs, with only amiodarone generating more than one judicial opinion.  Since our scorecards include every decision we find, both good and bad, they’re a pretty good indicator of what’s out there.

What we think this means is that preemption has been an excellent deterrent.  The other side doesn’t seem to be taking on many cases involving alleged injury from ingestion of generic drugs.  Seen any “bad drug” lawyer ads lately about generic drugs?  We haven’t either.  The post-Mensing onslaught of innovator liability claims wasn’t a portent, but was more of a last gasp.  That makes sense to us, too.  Innovator liability is another of these unusual theories of liability, like failure to update and failure to report adverse events to the FDA, that essentially didn’t exist in the absence of preemption.  Innovator liability lacks the simplicity and jury appeal of “they made it, they should pay” theories of strict liability and negligence.  All of the policy arguments that we’ve made against innovator liability have their jury-accessible equivalents, so this theory is another of these “bad” causes of action that plaintiffs pursue only when they have no other option.  It’s hard to prove liability, and harder to prove causation, so our opponents aren’t likely to bring innovator liability cases unless there’s some other significant incentive – usually in the form of big damages.

Thus, in terms of how innovator liability seems to be doing in practice, as opposed to theory, it’s looking more like a paper tiger than something that will actually pose an existential threat to our clients.  First of all, it remains an extreme minority theory.  As far as we know, not a single penny has ever been paid on a verdict based on innovator liability.  There are lots of other, less problematic, ways for our opponents to earn a living.  Short of some DES-like surprise latent injury from a popular generic drug, our best guess now is for innovator liability to be a one-off sort of claim asserted only in big damages/poor liability situations such as SJS/TENS cases.

Congress authorized multidistrict litigation “for the convenience of parties and witnesses” and to “promote the just and efficient conduct of such actions.”  28 U.S.C. §1407(a).  As we’ve documented in many posts in our MDL topic, the reality – at least in product liability mass torts involving prescription medical products – is so far from what Congress intended as to call the entire process into question.

Instead of convenience, we see the Rules of Civil Procedure being ignored on a massive scale to deprive defendants of motions practice, to postpone “case specific” defenses, and to force defendants not only to provide massive discovery of their own information, but also to shoulder discovery burdens, such as collection of medical records, that should be the plaintiffs’ responsibility.

Instead of “just and efficient conduct,” we see thousands of plaintiffs with weak to nonexistent cases parking themselves for years with no merits examination, while plaintiffs’ best cases are litigated in consolidated “bellwether” trials” (despite the statute limiting MDLs to “pretrial” proceedings) with legal and evidentiary rulings designed to produce huge verdicts that force defendants to settle, including all those weak cases that, without the MDL, would never have been filed in the first place.

Here are two more recent examples of MDL dysfunction.

In In re Biomet M2a Magnum Hip Implant Products Liability Litigation, 2019 WL 110892 (N.D. Ind. Jan. 3, 2019), the defendant brought the kind of case-specific dispositive motion that, outside of an MDL in all likelihood would have disposed of the cases. The defendant sought “summary judgment based on North Carolina’s repealed statute of repose” against seven North Carolina plaintiffs.  Id. at *1.  In the MDL, however, this case-specific motion was denied on the basis of not wanting to bother to figure out the law:

Early on in this multi-district litigation docket, I told the parties that I intended to leave sticky questions of state law to the courts that would try the cases, reasoning that those courts were more familiar than I with the governing law.  My second concern was the delay that would affect all cases in the docket as I tried to get up to speed on the laws and doctrines of each state involved in these proceedings.  After fulfilling my own prediction about delay on this motion, I have concluded that these North Carolina cases present issues that are best decided by courts more familiar than I with North Carolina law.

Id.  Talk about a government shutdown – all defense motions based on state law are selectively shut down in this MDL.  Thus, seven cases that, in the absence of MDL litigation, may well have been dismissed within weeks of being filed, instead survive to be parked in the MDL for who knows how long – probably until the pressure of numbers (including many other cases with “motion denied because I can’t be bothered” rulings) forces a settlement.

If “[a] federal district court sitting in North Carolina has a much better chance than I of getting the answer to this question right,” id. at *6, then by all means remand the cases right now.  It’s neither “convenient,” “just”, nor “efficient” to let likely meritless cases persist – and to force both sides, but particularly defendants – to expend time and effort on them – when without an MDL, this kind of excuse for refusal to decide a duly filed motion would never even be offered (short of exotic doctrines like abstention or certification of an issue to a state appellate court).  If it is too difficult, well, nobody forces courts to accept MDL assignments.

The second case, Weidenhof v. Zimmer, Inc., 2018 WL 7106980 (M.D. Pa. Dec. 28, 2018), demonstrates MDL-caused dysfunction at the other end of the litigation cycle – when all those meritless cases that have been flying under the radar in MDLs finally have to be dealt with.

Weidenhof was a solicited case that never belonged in the Zimmer Nexgen MDL at all.  This plaintiff had knee surgery in 2009 with a different device than those at issue in Nexgen.  Nonetheless, plaintiffs (husband and wife) “hired two law firms who filed a complaint on his behalf in 2012 in the Eastern District [of Pennsylvania].”  2018 WL 7106980, at *1.  That filing occurred on April 13, 2012.  Id.  “His case was transferred to a multi-district litigation court.”  Id.

Thereafter, Weidenhof sat parked in the MDL for two years with nothing happening – not even the most basic step of product identification.  The MDL defendants had to do the plaintiffs’ Rule 11 job for them, the investigation of such a basic legal requirement.  See Id. at *2 (“On July 1, 2014, Defendants filed a Motion requesting that the MDL Judge issue a Suggestion of Remand because the devices implanted in Mr. Weidenhof’s knee did not fall within the scope of the MDL Panel’s August 2011 Transfer Order.”).

No wonder there is a current proposal, which we support, to require all MDL plaintiffs affirmatively to establish product identification within 60 days.

In any event, in Weidenhof, “[a]fter two years his case was remanded because the artificial knee he had was not one of the products in the MDL case.”  Id. at *1.  “On October 24, 2014, Plaintiffs’ case was transferred back to its originating district, the Eastern District of Pennsylvania.”  Id. at *2.

Those two law firms that the plaintiffs euphemistically “hired” – were they ready to litigate their client’s case?

Of course not.  They were just soliciting MDL plaintiffs; they had no intention of doing any actual litigation.  Thus, after another eight months of nothing passed, “[o]n June 17, 2015, Plaintiffs’ counsel filed a Petition for Leave to Withdraw as Counsel,” and “[o]n August 3, 2015, the Petition was granted.”  Id.  The transferor court in the Eastern District of Pennsylvania thus was left with the task of correcting another of plaintiffs’ ex-counsel’s screw ups – improper venue.  “On October 14, 2016, the District Court in the Eastern District of Pennsylvania entered an Order transferring Plaintiffs’ case to the Middle District of Pennsylvania,” where it belonged.  Id.

Because of Weidenhof’s sojourn in the MDL, it thus took four years even to get this MDL-solicited case into the right court and suing over the right product – but without any lawyer willing to represent plaintiff when actual litigation was required.  The MDL master complaint, which Weidenhof had incorporated, being no longer applicable, plaintiffs were directed to file an amended complaint on February 6, 2017, almost five years after this litigation began.  Id.  That “complaint” (if it can be called that), was filed on March 7, 2017, and “in its entirety, provided ‘Knee Replacement 3-09-2009 OIP Orthopedics Camp Hill, PA 17074.  Product used was Bad Product.  Caused Permanent Disability.’”

In their statement of the amount in controversy, Plaintiffs appeared to request monetary damages in an amount of no less than $200,000.00 for pain and suffering.  In the relief section of their Amended Complaint, however, Plaintiffs assert that, “Pain and suffering will always be an issue!  And may lose medical if awarded money from the Court.  Also don’t know if disability money will continue or not.”

Id.

Defendant – well beyond the point of having enough of this garbage – moved to dismiss on April 7, 2017.  Id. at *3.  The court granted the motion on March 27, 2018, after delaying for nearly a year, but even then allowed the pro se plaintiffs a chance to file a proper complaint.  Id.  Of course, they missed the deadline; so they got yet another chance.  Finally, on June 4, 2018, they filed something that, at least was properly signed.  Id.

Defendant again moved to dismiss.  After now six years of litigation, plaintiffs didn’t even bother opposing the motion.  Id. at *5 (plaintiffs “failed to timely oppose the motion, or otherwise litigate this case.  This procedural default completely frustrates and impedes efforts to resolve this matter in a timely and fair fashion”).  Because plaintiffs had “repeatedly breached,” id. at *6, just about every applicable rule, the amended complaint was finally dismissed with prejudice.

[T]his case has been before five federal judges in three judicial districts.  In this instance, however, the procedural complexities do not negate Plaintiff’s personal responsibility in failing to prosecute.  Throughout this case, Plaintiff has been shown significant lenience appropriate for a party proceeding pro se. . . .  But despite efforts by the court to show flexibility, Plaintiff only intermittently complied with court orders issued by the Eastern District and by me.

Id. at *7.  Nor was there any meritorious claim asserted.

Plaintiff alleges no facts that would support a finding that Defendants’ conduct breached a duty . . . .  Rather, Plaintiff alleges he suffered for three years, not necessarily because of a product defect, but because “no doctor would revise the product” “[d]ue to the legal litigation against Zimmer Inc.

Id. at *13 (emphasis added).  So what plaintiffs were really complaining about – after six years of litigation – was that no physician was willing to treat the plaintiff because they were deterred by “the legal litigation.”  In other words, plaintiffs ended up alleging that they were injured by the MDL itself and the surrounding solicitation, not by the defendant’s product.

Weidenhof, in and of itself, is not all that important, but it raises the question of how much legal flotsam and jetsam is floating around the federal courts because of all the meritless filings generated by blunderbuss MDL-related attorney solicitation.  Somebody has to pay to clean up these messes, and it’s certainly not been the plaintiffs’ lawyers who engage in all these indiscriminate filings.  As in Weidenhof, they jump ship at the first sign of actual work to be done.  Weidenhof was in litigation since 2012 – six years, over the wrong product − and when all was said and done, the litigation itself had harmed plaintiffs more than the original product.  What a waste of time and effort.

Together, Biomet M2a Magnum Hip and Weidenhof demonstrate that, from beginning to end, the MDL system as it currently exists (at least in prescription medical product litigation) is shot through with inefficiency, one-sided practices, waste, delay, and client abandonment, all of which prejudice defendants and make a mockery of the original premises of the MDL statute.  We believe that the current proposals for MDL reform would be beneficial, but we have to consider that the current system may well be broken beyond any repair that civil rules changes could make.  What is really needed – with a current likelihood of about zero percent – is a thoroughgoing Congressional revision of the MDL statute itself.

Defendants in prescription medical product liability litigation are at an inherent disadvantage in discovery already.  Our clients have lots and lots of electronically stored information and old-fashioned paper documents.  Plaintiffs . . . not so much.  With our opponents having many categories of information to choose from, we think that it’s not that much to ask the other side at least to provide a reasonably detailed, case-specific set of document requests – and in many cases that’s what happens.  But all too often, the same kind of sloth that leads to plaintiffs’ parking their cases by the thousands in MDLs to avoid having to do any work also shows through in discovery.

Hence, we have to deal with “cloned discovery.”  We agree with the court in Barrella v. Village of Freeport, 2012 WL 6103222, at *2 (E.D.N.Y. Dec. 8, 2012), which, when faced with the plaintiff’s demand for “all deposition transcripts and discovery produced” in prior litigation, retorted that the plaintiff “can and should conduct his own discovery” and that the federal rules “do[] not permit a party to obtain discovery obtained in a separate lawsuit . . . simply because that party maybe does not wish to spend his own time or money.”  Id. at *2.

If you’ve never heard of the term “cloned discovery” before, “[t]he name derives from the fact that the plaintiffs are attempting to clone the discovery taken by others in unrelated cases.”  Wollam v. Wright Medical Group, Inc., 2011 WL 1899774, at *1 (Mag. D. Colo. May 18, 2011).

[I]n this case the cloned discovery seeks all “documents and things produced,” “transcripts of each, any, and all depositions,” “all reports by experts by any party,” and “all other discovery responses served by any defendant” in the following:

[A]ny action from January 1, 2001, to the present, in any state or federal court in the United States, or in a foreign court or tribunal, where it was claimed or alleged that an artificial hip designed, manufactured, or distributed by a Wright entity failed in such a way that the component known as the “modular neck” corroded, fretted, or fractured, regardless of whether that exact language was used.

Id. (citation to plaintiff’s discovery requests omitted).  Not only is this kind of discovery request lazy as sin (and often an attempt to avoid limits on the number of requests for production), but it’s inherently improper, particularly after the 2014 amendments to Rule 26(b)(1), which redefined the scope of discovery to include only: “any nonprivileged matter that is relevant to any party’s claim or defense.”  By definition, “all” of the discovery from a prior case is not going to be “relevant” to a subsequent personal injury case involving different plaintiff injured at a different time and place.

Unfortunately, these considerations don’t stop lazy lawyers – even when they get pushback.  The “issue” in such cases is “whether discovery taken in other, unrelated, and as yet unidentified cases . . . is relevant to the claims of these plaintiffs.”  Id.  Wollam said, “no way”:

[A] party seeking discovery ordinarily must do their own work and request the information they seek directly and must make proper requests describing the information in which they are interested.  Direct requests allow a court to consider the relevance of the information sought to the specific claims and defenses in the pending case.  A request for all discovery in unidentified actions taken worldwide with the single similarity that those actions involve the alleged failure of [the same product] does not allow such review.  Discovery is intended to be liberal, but it is not unbounded.  The sweeping cloned discovery sought by the plaintiffs has not been shown to be sufficiently relevant to the claims and defenses in this case and simply reaches too far. . . .  It is not clear to me that any showing would be sufficient to justify an order requiring the disclosure of all discovery made or received by the . . . defendants in unknown and unspecified cases.

Id. at *2.  See Fields v. Wright Medical Technology, Inc., 2017 WL 3048867, at *3 (N.D. Ind. July 19, 2017) (“to the extent that Plaintiff is requesting that the Court compel Defendants to produce information merely because it has been produced in other cases, and she has not specifically requested the information contained in those documents in this case, that request is denied”).

Cloned discovery has attracted our attention because it reared its ugly head again recently in Costa v. Wright Medical Technology, Inc., 2019 WL 108884 (D. Mass. Jan. 4, 2019), where the plaintiff actually got some benefit from this kind of slothful request.  Costa viewed “cloned discovery” as “attractive to litigants because it can reduce the burden and expense of obtaining relevant information and help the parties narrow the issues in dispute.”  Id. at *1.  While Costa rejected the plaintiff’s request for “all documents and data” from cases involving “distinct” products and from cases that “do not involve” that particular plaintiff’s claimed failure mode, id. at *2, it did compel production of discovery from a prior case involving the same product and claimed failure mode.  Id. We wouldn’t even go that far – for the same reasons that prescription medical product liability litigation is never appropriate for class actions.  Even if the device and failure mode are the same, every product liability plaintiff has a unique injury, at a different point in time, involving different medical treatment, medical history, and treating physicians.  It may well be that a great majority of the documents are in fact discoverable in the subsequent case, but that does not excuse a plaintiff from following the rules and asking for them properly, and complying with applicable numerical limits on document requests.

Because this type of request is basically harassment – not one of the seven deadliest, but more pertinent to current litigation strategies designed to force settlement by driving up an opponent’s costs − we thought we’d collect other pertinent authorities condemning cloned discovery.  We found a number of cases refusing blanket discovery of documents produced in governmental investigations.  Midwest Gas Services Inc. v. Indiana Gas Co., 2000 WL 760700 (S.D. Ind. March 7, 2000), the primary decision cited in Wollam, was not a drug/device case, but instead involved a demand for everything an antitrust defendant had turned over to the government in response to a Civil Investigative Demand.  When the defendant refused, plaintiff unsuccessfully sought to compel:

“Cloned discovery”, requesting all documents produced or received during other litigation or investigations, is irrelevant and immaterial unless the fact that particular documents were produced or received by a party is relevant to the subject matter of the instant case. . . .  [P]laintiffs are interested in the content of documents and for that they must make proper requests describing the information in which they are interested. The plaintiffs’ counsel must do their own work and request the information they seek directly.

Id. at *1.  Similarly, in Drake v. Allergan, Inc., 2014 WL 12664971 (D. Vt. March 19, 2014), cloned discovery “which permits plaintiffs to obtain all of the materials furnished in the Department of Justice investigation” was denied because it “may result in surrender of documents that are totally irrelevant to the pending litigation.”  Id. at at *3.  “Generally, courts discourage the use of criminal discovery requests as providing the framework for civil discovery demands in unrelated litigation due to the requirement that plaintiffs make specific requests for discovery related to their individual claims.”  Id.  “The better approach to discovery here is to require Plaintiffs to make individualized demands based upon what may be relevant documents.”  Id.  Accord Pensacola Firefighters’ Relief Pension Fund v. Merrill Lynch Pierce Fenner & Smith, Inc., 265 F.R.D. 589, 597 (Mag. N.D. Fla. 2010) (“production of all of the documents produced to the SEC, without a more particularized request, could potentially allow plaintiff to bypass the limitations on the scope of discovery established by the Rules”); In re WorldCom, Inc. Securities Litigation, 2003 WL 22953645, at *7 (S.D.N.Y. Dec. 16, 2003) (“[w]hile the record generated by the Government’s work may ease the burdens of the civil litigation, the civil litigants enjoy those benefits as a matter of convenience, not as of right”); In re Milk Products Antitrust Litigation, 84 F. Supp.2d 1016, 1026 (D. Minn. 1996) (denying cloned discovery seeking documents “already compiled by Defendants in response to subpoenas from the Antitrust Division of the United States Department of Justice”); Cook v. Rockwell International Corp., 147 F.R.D. 237, 245-46 (D. Colo. 1993) (denying plaintiffs’ attempt “to piggyback on the very same discovery the grand jury conducted” in a prior criminal proceeding; “[w]hile materials relevant to Plaintiffs’ case may overlap with those subpoenaed in [the criminal case], Plaintiffs must obtain those documents because they are relevant to the claims in this case, not simply because they were provided to the grand jury in its criminal investigation”).

Concerning prior civil litigation, King County v. Merrill Lynch & Co., 2011 WL 34384913 (W.D. Wash. Aug. 5, 2011), relied on both Wollam and Midwest Gas, and explained that cloned discovery was improper because “without more, the Court cannot ascertain whether the documents requested actually relate to Plaintiffs’ claims and defenses” in the current case.  Id. at *3.  Even if “some portion of documents encompassed by Plaintiffs’ request may be relevant, the Court has no method of determining which of those documents are relevant, and which are not.”  Id.  Heck, even if “each and every document” were discoverable, “Plaintiff must make proper discovery requests, identifying the specific categories of documents sought, in order to obtain them − and each category must be relevant to its claims and defenses.’”  Id.

The first case we found that dealt with cloned discovery was Payne v. Howard, 75 F.R.D. 465 (D.D.C. 1977), which involved a blanket request for “pleadings” from a defendant’s prior litigation.  That’s less broad than the “any and all” cloning requests we tend to see these days (which usually ask for everything), but Payne refused to allow even that:

Whether pleadings in one suit are “reasonably calculated” to lead to admissible evidence in another suit is far from clear. In the Court’s view, discovery of this type of information typically will not lead to admissible evidence. . . . To date, there has been no inquiry into how let alone a showing that the pleadings sought by plaintiff are related to any of the issues raised in the instant case. Given that fact, and given also the unlikelihood that an adequate proffer could be made, the Court must conclude that the items sought are not “reasonably calculated” to lead to the discovery of admissible evidence.

Id. at 469.

Other cases denying cloned discovery requests are:  In re Volkswagen “Clean Diesel” Marketing, Sales Practices, & Products Liability Litigation, 2017 WL 4680242, at *2 (Mag. N.D. Cal. Oct. 18, 2017) (“Plaintiffs are not entitled to complete access to the MDL Production simply because there may be an overlap between their claims and those [here].  They instead must serve requests for production on [defendant] in accordance with the Federal Rules.”); Z Best Body & Paint Shops, Inc. v. Sherwin-Williams Co., 2017 WL 3730515, at *3 (Mag. C.D. Cal. Aug. 29, 2017) (“the broad request for all ‘record and documents’ produced by Defendant in [prior litigation] appears to be overbroad on its face”); Strickland v. Tristar Products, Inc., 2017 WL 2874621, at *1 (Mag. S.D. Ga. July 5, 2017) (“Plaintiffs are not entitled to ‘all documents’ and ‘all depositions’ in the 10 identified cases, regardless of the pertinence of those materials to the instant case.  They simply must identify the materials more specifically than ‘all.’”); Racing Optics v. Aevoe Corp., 2016 WL 4059358, at *1-2 (D. Nev. July 28, 2016) (“’Piggyback’ discovery requests are prohibited. . . . [plaintiff] need[s] to specify which documents it want[s] and to demonstrate its relevance”), reconsideration denied, 2016 WL 4994961 (D. Nev. Sept. 16, 2016); Caves v. Beechcraft Corp., 2016 WL 355491, at *2 (Mag. N.D. Okla. Jan. 29, 2016) (cloned discovery seeking “any and all testimony concerning any other litigation, regardless of connection to the accident or [product] at issue, is clearly objectionable”); Town of Westport v. Monsanto Co., 2015 WL 13685105, at *3 (Mag. D. Mass. Nov. 5, 2015) (cloned discovery “requests for all discovery and deposition testimony from all [prior] litigation [involving the same chemical] is overly broad”); Capital Ventures International v. J.P. Morgan Mortgage Acquisition Corp., 2014 WL 1431124, at *1-2 (D. Mass. Apr. 14, 2014) (“plaintiff indiscriminately pursues wholesale production of all testimonial materials from all employees in all [prior] cases or investigations”; “This request for ‘cloned discovery’ is, like the request for testimonial materials, overbroad and of speculative relevance.”); Burke v. Ability Insurance Co., 291 F.R.D. 343, 355 (D.S.D. 2013) (“The court will not compel defendants to produce all documents from prior litigation when [plaintiff] has not established how they will be relevant or what that prior discovery contains”); Wiand v. Wells Fargo Bank, N.A., 2013 WL 6170610, at *3 (Mag. M.D. Fla. Nov. 22, 2013) (cloned discovery held “overbroad on its face for failing to specify any subject matter of the sought-after documents.  By asking for ‘all documents produced . . .’ in the other litigation, the scope of the request is far too expansive.”); In re Cathode Ray Tube (CRT) Antitrust Litigation, 2013 WL 183944, at *1-4 (N.D. Cal. Jan. 17, 2013) (rejecting overseas litigant’s cloned subpoena to “produce all discovery related to the [prior] action” under similar analysis); Pegoraro v. Marrero, 281 F.R.D. 122, 132 (S.D.N.Y. 2012) (cloned discovery denied as “overly broad in its scope because it seeks all documents in connection with any [similar] litigation or proceeding involving the defendants, regardless of the specific nature of the proceeding and factual circumstances underlying those proceedings”); N.J. Carpenters Health Fund. v. DLJ Mortgage Capital, Inc., 2012 WL 13135408, at *1, slip op. (S.D.N.Y. March 2, 2012) (rejecting “monkey see/monkey do” discovery; plaintiffs’ “request that says ‘you gave some documents to the government concerning another investigation, so give them to me’ is DENIED”); Bean v. John Wiley & Sons, Inc., 2012 WL 129809, at *2 (D. Ariz. Jan. 17, 2012) (cloned discovery concerning “similar” but “different” prior litigation denied); Eisai Inc. v. Sanofi-Aventis U.S., LLC, 2011 WL 5416334, at *8 (Mag. D.N.J. Nov. 7, 2011); (cloned discovery held “irrelevant, unlikely to lead to the discovery of admissible evidence in this matter, and that production of same would unduly burden Defendants”); Chen v. Ampco System Parking, 2009 WL 2496729, at *2-3 (Mag. S.D. Cal. Aug. 14, 2009) (“similarities between the [prior] cases and this case . . . are not enough to require a carte blanche production of all documents from the state cases”; “Plaintiff must specifically ask for the documents he wants and be able to demonstrate that the information he seeks is relevant to his claims in this case”) (emphasis original); American Eagle Outfitters, Inc. v. Payless Shoesource, Inc., 2009 WL 152712, at *1 (Mag. E.D.N.Y. Jan. 21, 2009) (cloned discovery “seek[ing] broad categories of documents relating to every litigation in which the defendant has ever been involved where [similar] violations have been alleged” denied as “considerably overbroad”); Moore v. Morgan Stanley & Co., 2008 WL 4681942, at *5 (Mag. N.D. Ill. May 30, 2008) (“just because the information was produced in another lawsuit . . . does not mean that it should be produced in this lawsuit”); Kormos v. Sportsstuff, Inc., 2007 WL 2571969, at *3 (Mag. E.D. Mich. Sept. 4, 2007) (plaintiff’s cloned discovery demanding “copies of any and all other legal complaints filed by other plaintiffs against Defendant” held “as overly broad, unduly burdensome and not reasonably calculated to lead to the discovery of admissible evidence”); Wyeth v. Impax Laboratories, Inc., 248 F.R.D. 169, 171 (D. Del. 2006) (a “request for all documents from the [prior] Litigation is overly broad. The Court finds that [requestor] has not demonstrated why it is entitled to documents from the [prior] involving matters not at issue in this litigation”); Oklahoma v. Tyson Foods, Inc., 2006 WL 2862216, at *2 (Mag. N.D. Okla. Oct. 4, 2006) (“Plaintiffs appear to equate ‘similarity to a prior lawsuit’ to relevant to a claim or defense in the current proceeding. The Court cannot accept that this conclusion is automatic.”).

It’s bad enough for our clients to be subjected to asymmetrical discovery over and over again.  It would be worse to allow plaintiffs to recreate that asymmetry in any case they choose, merely by demanding all the discovery that took place previously in other cases.  Cloned discovery is an abusive practice that always should be resisted.

We’ve been chronicling the troubles that defendants have been having in getting Pennsylvania courts to follow the Due Process requirements of personal jurisdiction since Daimler AG v. Bauman, 571 U.S. 117 (2014).  We lamented that Pennsylvania seemed to be going off the deep end while discussing Webb-Benjamin, LLC v. International Rug Group, LLC, 192 A.3d 1133 (Pa. Super. 2018).  Webb-Benjamin relied on a couple of federal district court opinions, Bors v. Johnson & Johnson, 208 F. Supp.3d 648 (E.D. Pa. 2016) (which we discussed here), and Gorton v. Air & Liquid Systems Corp., 303 F. Supp.3d 278, 299 (M.D. Pa. 2018), to conclude that general personal jurisdiction – which Bauman limited to the “at home” standard of principal place of business or state of incorporation – existed in Pennsylvania because a state statute (42 Pa. C.S. §5301) mandated use of a lesser standard that could be satisfied by nothing more than a foreign corporation’s registration to do business in Pennsylvania.  192 A.3d at 1138-39.

We’ve never given this statute – or the cases relying on it – much credence because it’s been pretty darn clear, at least since the Civil War, that state statutes cannot supersede the federal constitution.  Courts holding otherwise must be channeling John C. Calhoun.

On the Pennsylvania state court side, things are in hiatus at the moment, because in another case, the Pennsylvania Superior Court has agreed to en banc reconsideration of this issue.  See Murray v. American Lafrance, LLC, 2018 Pa. Super. Lexis 1320 (Pa. Super. Dec. 7, 2018).  If the en banc court agrees with us, that would nullify Webb-Benjamin and result in the Pennsylvania state courts following Bauman (as practically every other state in the country already does).

On the federal side, however, Bors and Gorton professed to be bound by the pre-Bauman Third Circuit decision which held that “consent” is a separate jurisdictional theory from “general”/”all purpose” and “specific”/”case-linked” personal jurisdiction.  That nearly thirty-year-old decision, Bane v. Netlink, Inc., 925 F.2d 637 (3d Cir. 1991), held as follows:

[Defendant’s] application for a certificate of authority can be viewed as its consent to be sued in Pennsylvania under section 5301(a)(2)(ii), which explicitly lists “consent” as a basis for assertion of jurisdiction over corporations.  Consent is a traditional basis for assertion of jurisdiction long upheld as constitutional.  We hold that because [defendant] was authorized to do business in Pennsylvania, it was subject to the exercise of personal jurisdiction by Pennsylvania courts under [the Pennsylvania statute].

Id. at 541 (citing Hess v. Pawloski, 274 U.S. 352, 356-57 (1927), and Dehne v. Hillman Investment Co., 110 F.2d 456, 458 (3d Cir. 1940)).

That’s it.  Bane’s consent-based ruling is all of three sentences, supported by two ancient decisions pre-dating International Shoe Co. v. Washington, 326 U.S. 310 (1945). We know what Bauman had to say about that kind of precedent – “citations to these [pre-International Shoe] cases, both decided in the era dominated by Pennoyer’s territorial thinking, should not attract heavy reliance today.”  571 U.S. at 138 n.18.  Heck, Bane didn’t even cite International Shoe itself.

Nonetheless, like lemmings over the cliff, Pennsylvania district court decisions have continued to follow Bane, to ignore Bauman, and thus to hold defendants subject to general jurisdiction under Pennsylvania law on nothing more than registration to business.  See Shipman v. Aquatherm L.P., 2018 WL 6300478, at *2 (E.D. Pa. Nov. 28, 2018); Aetna Inc., v. Mednax, Inc., 2018 WL 5264310, at *5 (E.D. Pa. Oct. 23, 2018); Pager v. Metropolitan Edison, 2018 WL 491014, at *2 (M.D. Pa. Jan. 19, 2018); Plumbers’ Local Union No. 690 Health Plan v. Apotex Corp., 2017 WL 3129147, at *10-11 (E.D. Pa. July 24, 2017); Hegna v. Smitty’s Supply, Inc., 2017 WL 2563231, at *3 (E.D. Pa. June 13, 2017).

In the most recent of these decisions, Youse v. Johnson & Johnson, 2019 WL 233884 (E.D. Pa. Jan. 16, 2019), the plaintiff did not even attempt to argue that Pennsylvania had general jurisdiction – or even the “minimum contacts” necessary to establish specific jurisdiction – over the moving defendant, a company that sold raw talc, but not in Pennsylvania.  Youse didn’t care that the defendant had no factual contacts at all with Pennsylvania – as long as it filed that piece of paper decades ago, that was enough.

[C]ourts in this district have continued to apply the precedent established by the Third Circuit in Bane to hold that registration to do business in Pennsylvania constitutes consent to jurisdiction. Other judges in this district have found that under §5301, business registration constitutes consent to jurisdiction in Pennsylvania, even after [Bauman].  Without the Third Circuit overruling Bane or distinguishing [Bauman], we follow these decisions and conclude that registration to do business in Pennsylvania is sufficient to create general personal jurisdiction.

2019 WL 233884, at *3-4 (cites and quotes of the same cases we just finished string-citing omitted).

Defense counsel – listen up youse guys – the courts are telling you what you have to do to get your clients out of this unconstitutional box.  Bauman “did not address whether registration to do business is a sufficient basis for general personal jurisdiction, and the Third Circuit has not addressed the question of consent-based jurisdiction” since.  Id. at *3.  Forget about convincing a district court; nothing’s going to happen on the federal front until the Third Circuit reconsiders and overrules Bane.

This is a classic issue warranting interlocutory appeal under 28 U.S.C. §1292(b).  Interlocutory appeal by permission under §1292(b) must:  (1) “involve[] a controlling question of law as to which there is substantial ground for difference of opinion,” and (2) “an immediate appeal from the order may materially advance the ultimate termination of the litigation.”  As to the first prong, our 50-state survey of general jurisdiction by consent precedent discusses at great length how every federal court of appeals to address this question since Bauman, and all eight state high courts, have unanimously concluded that “consent” based on corporate registration alone is fundamentally inconsistent with current principles of constitutional Due Process.  That meets any standard of “substantial grounds.”  Under prong two, an erroneous decision on personal jurisdiction puts at risk of nullification everything that follows in the litigation.  See, e.g., Estate of Fox v. Johnson & Johnson, 539 S.W.3d 48 (Mo. App. 2017), transfer denied (Mo. Dec. 19, 2017) & (Mo. March 6, 2018) (overturning multimillion dollar talc verdict and dismissing for lack of personal jurisdiction).  If there’s no personal jurisdiction, then there’s no case at all to litigate.  Thus the requirement that “ultimate termination” of the litigation be “materially enhanced” should also be a lead pipe cinch.

Thus, we strongly recommend that defense counsel, in order to stop our clients from ceaselessly dog-paddling in the Pennsylvania deep end, seek interlocutory appeals in every future case where Bane and general jurisdiction by consent are all that is preventing dismissal for lack of personal jurisdiction.  Sooner or later, hopefully sooner, one of the judges will grant that relief.

It was a Merry Christmas and a Happy New Year for Tucker EllisDustin Rawlin and his breast implant defense team – and they were considerate enough to share it with us.

Wait a minute, you might be saying, breast implant litigation?  Isn’t that passé? I n a sense, we’d agree with you.  This isn’t your father’s breast implant litigation.  Twenty or more years ago, one of the first wave of solicitation-driven medical device mass torts produced thousands of claims and multi-district litigation.  In another precursor of things to come, causation of almost all of the claimed injuries was scientifically discredited.  E.g., In re Silicone Gel Breast Implants Products Liability Litigation, 318 F. Supp.2d 879 (C.D. Cal. 2004); In re Breast Implant Litigation, 11 F. Supp.2d 1217 (D. Colo. 1998); In re Silicone Gel Breast Implant Products Liability Litigation, 1996 WL 34401766 (N.D. Ala. Oct. 31, 1996); Institute of Medicine, “Review of the Reports of the Independent Review Group and the National Science Panel on Safety of Silicone Breast Implants” (1999).  The litigation was thus 99.9% junk science, but in another portent of things to come, it was nonetheless sufficiently expensive to bankrupt some defendants and to force others to settle.

One other effect of the original breast implant litigation was to spook the FDA.  Motivated largely by fears of bad public relations – certainly not science – the FDA reclassified breast implants as Class III medical devices that required pre-market approval.  However disruptive the FDA’s action may have been on the market, and however many women might have been deprived of this product’s benefits in the interim, the FDA’s action is also why this isn’t your father’s breast implant litigation.

Product liability actions against PMA medical devices are subject to broad preemption, and that’s a new way for breast implant defendants to win such litigation.

On Christmas Eve came Cashen v. Johnson & Johnson, 2018 WL 6809093 (New Jersey Super. Law Div. Dec. 24, 2018), which granted the defendants’ motion to dismiss with prejudice on preemption grounds.  Cashen involved litigation tourists from Ohio who brought the usual strict liability, negligence, fraud, and consumer protection claims. Preemption wiped most of these out. Fraud claims “relating to the safety or effectiveness of the device” were preempted no matter how plaintiffs pitched them:

[C]laims of fraudulent misrepresentation and fraudulent concealment seek to either (1) impose different or additional requirements to those that the FDA has already determined to have been satisfied or (2) stand in the place of the FDA and enforce federal requirements.  The former would make the claims expressly preempted while the latter would be impliedly preempted.

Id. at *7.  Plaintiffs could not escape their complaint, which alleged fraud over the device’s “propensity to cause serious physical harm” and “misrepresentations and concealments regarding the safety” of the device.  Id. at *8.

In addition, the Ohio legislature, had had enough of judicial expansion of common-law product liability and enacted a statute (“OPLA”) that abolished the common law altogether and replaced it with statutorily defined causes of action.  The fraud claims also fell because they had been “abrogated.”  Id. at 8-9.

Cashen dodged the question of whether Ohio’s consumer protection statute was preempted, because “it clearly falls within the umbrella of the OPLA . . . and is appropriately dismissed.”  Id. at 9-10.

Finally, the statutory definitions of product liability claims was facially preempted, whether involving design, manufacturing, warnings, or warranty. Id. at *10-11.

Notably, Cashen appears to be the first claim of breast implant associated-anaplastic large cell lymphoma (“BIA-ALCL”) to be thrown out on a motion to dismiss.  This “new disease” isn’t related to silicone and thus wasn’t addressed by the aforementioned Independent Review Group.  It’s one way for plaintiffs to avoid the IRG’s devastating causation conclusions, thus it’s significant to see preemption stop a BIA-ALCL claim in its tracks.

Merry Christmas.

Then came Ebrahimi v. Mentor Worldwide LLC, 2018 WL 6829122 (C.D. Cal. Dec. 27, 2018).  This is the third judicial decision in this case.  We examined the other two, here and here.  This time, the plaintiff’s now third amended complaint alleged “a single cause of action for strict product liability arising out of a manufacturing defect,” since everything else had already been held preempted.  Id. at *1.  The remaining claim fared no better.

The purported manufacturing defect simply wasn’t.  Plaintiff in Ebrahimi had seized upon a descriptive sentence in the “product insert data sheet” (of which the court took judicial notice because “as it is available on the FDA’s website,” id. at 1 n.2.) and sought to convert it into a design specification.  Ebrahimi called out the plaintiff’s ruse:

The Sheet simply indicates that [defendant] conducted a laboratory test on one of its Implants, and [description of test results].  The Sheet does not state that the FDA required Mentor to manufacture a shell that [always matches those results].  In fact, the Sheet does not purport to announce the FDA’s manufacturing specifications.

Id. at *2.  That was pretty much all she wrote for plaintiff’s sole surviving claim.  It’s not easy to gin up a manufacturing defect for violating a specification without having a specification in the first place.  In judicial language, that’s “an unwarranted deduction of fact that is not entitled to the presumption of truth.”  Id. (citation and quotation marks omitted).

Since the third amended complaint’s remaining allegations were a rehash of claims that had already been dismissed, id., that was the end of the line.  Three strikes and yer out!  “As [plaintiff] has once again failed to allege such a claim, the Court shall not grant her leave to file yet another amended complaint.”  Id.

Happy New Year.  And to the plaintiffs − so long, and thanks for all the fish.

That part of this title is borrowed from a fellow blogger’s post does not at all detract from its fundamental truth.  Attention to personal jurisdiction wins cases – particularly in MDLs in which lawyers are out there recruiting clients, rather than the other way around.  The latest example is In re Zostavax (Zoster Vaccine Live) Products Liability Litigation, 2019 WL 121199 (E.D. Pa. Jan. 7, 2019).  Zostavax also underscores why a case we recently discussed, In re Biomet M2A Magnum Hip Implant Products Liability Litigation, ___ F. Supp.3d ___, 2018 WL 6426830 (JPML Dec. 6, 2018), is significant.

Zostavax is not one of your typical litigation tourist MDL cases.  Both of the two plaintiffs, whose cases were ultimately dismissed, were residents of the forum in which they initially brought suit – Florida.  However, indicative of how lawyer solicitation scrapes the bottom of the barrel in MDLs, both plaintiffs had used the product quite a few years earlier before they (probably retired and) moved to Florida.  One plaintiff used the product in July, 2011, and the other a year later in July 2012.  Zostavax, 2019 WL 121199, at *1.  Suit was not filed until 2018, according to the docket numbers.

No basis existed to subject the defendant to general jurisdiction in Florida, id. at *3, and since the plaintiffs both took the product and were diagnosed with their alleged injuries before they moved to Florida, neither did the facts support specific, case-linked jurisdiction in the state.  “For purposes of personal jurisdiction, we must look to the place where the injury occurred, not to the place where it was diagnosed.”  Zostavax, 2019 WL 121199, at *4.  Rather:

The relevant activity or occurrence with respect to [the first plaintiff] took place in Edgartown, Massachusetts when she received the [product].  The relevant activity or occurrence with respect to [the second plaintiff] took place in Connecticut where she was injected with [the product].  The torts which allegedly caused their injuries happened in places other than Florida.  While plaintiffs were long-time residents of Florida, [defendant] did nothing to and had no interaction with either of them in that state.  [Defendant] was not at home in Florida, and plaintiffs’ injuries did not arise out of and were not related to any contact it had with Florida, regardless of what [defendant’s] other activities in the state may have been.

Id..  That’s straight out of BMS – where the product did not injure the plaintiff in the forum state, no matter how extensive the defendant’s non-case-related in-state activities are, they cannot establish specific jurisdiction.  You’ll have to go somewhere else.

Nor does personal Jurisdiction turn on how “convenient” the forum might be:

Florida’s power does not extend to [defendant] in these actions even if Florida would be a convenient place for plaintiffs to sue and would not be inconvenient or burdensome to large corporations such as defendants.

Id.

Zostavax underscores a jurisdictional point defendants need to keep in mind.  Personal jurisdiction motions are not limited to litigation tourists.  Once Bauman took out the old notion of general jurisdiction everywhere a major corporation did business, plaintiffs either have to sue corporate defendants where they are “at home” or where they can obtain specific jurisdiction.  Specific jurisdiction is necessarily quite commonly where the plaintiff resides – but not always.  Plaintiffs who change their states of residence in between injury and filing suit can create, as in Zostavax, jurisdictional problems for themselves.  In these non-litigation-tourism cases, defendants might choose to waive the jurisdictional defect.  However, in prescription medical product cases, where the “learned intermediary” prescriber is often the most important witness, such a waiver can create discovery problems for defendants (can’t subpoena the prescriber), so there is good reason to stand on a valid jurisdictional defense.

Equally interesting is the discussion about what happens once the absence of personal jurisdiction is established.  In Zostavax, plaintiffs alternatively sought a transfer.

Denied.  Cases dismissed.

Why?  That involves the issue decided in the Biomet M2A Magnum case we discussed previously.  That case established that an MDL judge can only remand cases to the courts from which they were originally filed.  Zostavax, 2019 WL 121199, at *5.  MDL courts are “preclude[d] . . . from transferring a case to any other district, whether under §1404(a), §1406(a) or §1631.”  Id. (citing various statutes allowing transfer in various circumstances).  This means that if an MDL plaintiff’s initial filing is in a court without personal jurisdiction, it’s curtains.  The action must be dismissed, because it cannot be remanded to the transferor court – because cases can’t be sent to a court that was just determined to lack jurisdiction – nor can they be transferred anywhere else, given the terms of the MDL statute.

If the case (as in Zostavax) has to be dismissed, then see our post here about savings statutes.  In some states the MDL dismissal may bar the claim from being refiled under the applicable statute of limitations.

Finally, the transfer discussion points out another consequence of Bauman/BMS personal jurisdiction:  in some cases, plaintiffs simply might not be able to join all the defendants they want to in the same lawsuit:

[T]here does not appear to be any one forum where general jurisdiction could be exercised over all defendants.  As to specific jurisdiction, there is nothing in the record pointing to any ties between causation of plaintiffs’ injuries in Massachusetts and Connecticut and any activity of [the non-moving defendant] in those states.  In sum, the court is not able to determine . . . in what district or districts, if any, either of these actions could have been brought at the time they were filed.

Zostavax, 2019 WL 121199, at *5.

If you’ve ever wondered why so many of the post-Bauman personal jurisdiction cases have involved asbestos plaintiffs, this is why.  The Bauman/BMS personal jurisdiction regime is fatal to asbestos litigation tourists (or plaintiffs who, like the plaintiffs in Zostavax, just didn’t sue where they were injured) because without “case-linked” personal jurisdiction tied to the place of injury it’s impossible to obtain jurisdiction over scores of unrelated corporations.  Because we (at least Bexis) also dabble in asbestos litigation, we’re careful to specify in our cheat sheet which cases involve asbestos.

Zostavax demonstrates that blanket personal jurisdiction can also be impossible for litigation tourists in prescription medical product MDLs.  Multiple defendants – be they physicians, hospitals, distributors, affiliates, whatever – may well not be amenable to personal jurisdiction in the same forum, unless the plaintiff sues where s/he allegedly was injured.  There’s now a real downside to litigation tourism, in that cases can be dismissed without ability to refile.  To us, that’s the most interesting aspect of Zostavax:  judicial recognition that in multi-defendant cases, litigation tourism itself may not be possible.

Last week Bexis published a Legal Backgrounder for the Washington Legal Foundation, entitled “Recent Rulings Establish New Beachheads For Preemption In Drug And Device Product Liability Litigation.”  It discusses several 2018 prescription medical product liability preemption rulings and what they portend for future litigation concerning the most powerful defense that our clients have.  If you’re interested, you can read it here.

We’ve reviewed the transcript of the oral argument in Merck Sharp & Dohme Corp. v. Albrecht, No. 17-290 (U.S.), e.g., the United States Supreme Court appeal from the horrible decision in In re Fosamax (Alendronate Sodium) Products Liability Litigation, 852 F.3d 268 (3d Cir. 2017), which we ranked as the worst case in all of 2017.  Our one sentence reaction – We’d rather be us than them.

The Fosamax plaintiffs have a lot of problems with their position in Albrecht, chief among them that the FDA itself, as amicus curiae in this case, disputes their interpretation of what the Agency knew and did.

Briefly, plaintiffs argued that:  (1) the FDA’s rejection of the defendant’s “stress fracture” warning was because stress fractures and the injury at issue in the litigation – now called “atypical femur fractures” (or “AFF” for short) − were two different things; (2) the FDA only rejected the imprecise term “stress fracture,” and didn’t reject an AFF warning, and (3) the rest of the regulatory record consists of FDA “musings” that plaintiffs are free to contradict and juries would be free to disregard.  Albrecht Tr. at 35-38, 42-44, 61-63.

Equally briefly, defendant argued that:  (1) its rejected “stress fractures” warning encompassed AFF (a term only created later), demonstrated by language about “complete” and “non-traumatic” fractures; (2) the FDA’s rejection was based on insufficient data about AFF, since a short time later the Agency set up a task force to study AFF before changing labels for this drug class (bisphosphonates); and (3) the FDA does not simply reject scientifically valid warnings for grammatical reasons.  Albrecht Tr. at 3-5, 10-12, 16-19, 65-66.

The FDA, represented by the Solicitor General’s office, agreed with the defendant’s depiction of its regulatory actions regarding AFF, arguing that the Agency obeyed the law and did not reject the defendant’s label for imprecise language, but rather because the link between AFF and bisphosphonates was not supported by sufficient scientific data at the time  Albrecht Tr. at 20-22, 27-30.

At the oral argument another problem for the plaintiffs was evident:  Justice Stephen Breyer.  A member of the majority in Wyeth v. Levine, 555 U.S. 555 (2009), and an anti-preemption dissenter in the more recent PLIVA, Inc. v. Mensing, 564 U.S. 604 (2011), and Mutual Pharmaceutical Co. v. Bartlett, 570 U.S. 472 (2013), decisions, Justice Breyer is a “must get” vote for plaintiffs in Albrecht.  They don’t have him:

JUSTICE BREYER: I’m leading to this, that, when you talk about the standard, drugs are important to people.  They cure millions, or thousands, anyway, of people who need to be cured or helped.

Now, when you put on, and at the same time there will be a smaller subset that can be hurt, so our solution to that is labels.

Now, when you say displacing state law or something, you’re talking like a lawyer, which is what you’re supposed to do, but what worries me is, if you go too far in allowing the tort jury to find mislabeling by not including things, you are hurting the vast majority of − of women here or −or whatever who can benefit from this medicine.

On the other hand, if you don’t go far enough, you will hurt that minority. Now that’s the general framework in which I’m trying to figure out the answer to the question.  And that’s why Justice Gorsuch’s question was − was quite relevant.

All the earmarks here are that Merck took this as a letter saying we’re not certain enough this is really going to hurt people and we don’t want you to put it on.

Now, obviously, somebody must have picked up the phone when they got that letter and they must have phoned somebody in FDA and say:  Do you really mean that? What do you mean?  Because I can change those words, “stress fracture,” in two seconds.  Or do you mean you don’t know enough about it?

Now the appointment of the later task force suggests that they felt they didn’t know enough about it, and, therefore, Merck couldn’t have done it.

Albrecht Tr. at 40-41 (emphasis added).  That wasn’t so much a question as it was a speech, and one that we very much applaud.  But that’s not all.

JUSTICE BREYER: . . .  But what’s actually bothering me about the approach that you’re taking is that, in this particular area, in this particular area of medicines, I don’t really see how we’re going to benefit by 50 different states really giving different signals to the manufacturers, and I can see a lot of ways in which, from a health point of view, we’re going to lose.

That doesn’t mean the law is wrong.  It doesn’t mean − you know, it’s just a question of emphasis. And, here, we have an emphasis.

The next page from the one you cited, the FDA says in 2010, FDA’s review of the data did not show an increase in this risk, the relevant risk, in women using these medications.

So there are indications in this record . . . that they thought that it is more dangerous to put the label − to put the risk in the label than it is to leave it out. . . . And then they set up a task force and decide they were wrong.

Albrecht Tr. at 51-52 (emphasis added) (attempts by plaintiffs’ counsel to get a word in edgewise omitted).

To us defense counsel, these comments by Justice Breyer were the highlight of the argument.

We were also paying attention to Justice Gorsuch, a conservative, but known skeptic of the administrative state, who might not have much deference to the FDA’s actions.  Indeed, Justice Gorsuch had some tough questions for defense counsel about creating a “moral hazard” that might encourage submission of “inartful” warnings, about the availability of unilateral CBE warning changes, and about when “new information” existed.  Albrecht Tr. at 13, 18-19.  But in each instance, counsel provided persuasive answers: (1) that the FDA’s actions belied any such “moral hazard” here; (2) that CBE scientific support standards are identical to the pre-approval process the defendant used; and (3) that new evidence in this instance meant the findings of the FDA task force announced shortly after Agency’s rejection of the warning at issue. Id. at 13-14, 18-19.  If skeptical of the FDA, Justice Gorsuch didn’t show it, not speaking during the SG’s argument. Justice Gorsuch’s later comments, during the plaintiffs’ argument, were clearer:

We have, though, the March 2010 safety statement from the FDA which pretty clearly says that they do not think that there is science enough to support a causal link between the drug and atypical femoral fractures.

So whatever was missing in the complete response letter from the FDA seems to come in March of 2010.

Albrecht Tr. at 34-35.

[T]hat’s why it [the FDA] set up the task force at the same time to go study the issue, and it said up to that point we don’t have enough, but we’re going to go study it. . . . And so why isn’t that − tell us everything we need to know about what its complete response letter was about, as a matter of law?

Id. at 36-37.

As for the two specific holdings that the Third Circuit made in Fosamax – that “clear evidence” means preemption is decided under a “clear and convincing evidence” standard, and that determining what the FDA would have done is a question for the jury – the first was, surprisingly, not mentioned at all. Since plaintiffs abandoned this argument in their briefing, it will be interesting to see what (if anything) the Court holds about the standard of proof. The judge/jury issue received some scrutiny during the plaintiffs’ argument, with plaintiffs backpedaling furiously in response to a question from Justice Alito.:

We agree with Merck that, because of the complete response letter . . . was a legal document that a judge can interpret.  We believe that, based on a sound interpretation of the letter, it doesn’t prove impossibility.

Albrecht Tr. at 58-59.  Then the some other justices got into the discussion, after plaintiffs tried to have it both ways, with the remarkable statement that “the warning that the FDA has to reject has to be adequate to address the risks under state law.”  Id. at 59.  Then was what the FDA had to do a legal question (for the judge) or a factual question (for the jury)?

JUSTICE KAGAN: . . . But that’s the question. And that’s a legal question, is that correct?

[Plaintiffs’ Counsel]: It is a legal that question, but it has factual components.

JUSTICE KAGAN: But a judge can decide that question.

[Plaintiffs’ counsel] : A judge can decide the core legal question, but in all constitutional questions, there are usually fact issues, and we consign those to juries to decide what the fact issues….

JUSTICE BREYER: Not always. There are a lot of mixed issues where, because they’re predominantly legal, the judge does it; patents, for example, Markman [v. Westview Instruments, Inc., 517 U.S. 370 (1996)] is a case of that, and does coerced confessions. I mean, there are a number. . . .  It seems to me that this is in that number because it’s predominantly a legal question and there could be factual disputes on the brute [sic] facts. But, here, I don’t think there are really.

Id. at 59-60 (plaintiffs’ counsel’s attempt to get a word in edgewise omitted). If, in the end, both Justices Kagan and Breyer are skeptical of the idea of preemption/FDA actions as a jury question as they seemed at the oral argument, then the defendant will prevail on this issue as well.

Finally, we’d be remiss not to mention the plaintiffs’ “swing and a miss,” where counsel missed a softball from Justice Sotomayor so badly that the Justice had to provide the right answer:

JUSTICE SOTOMAYOR: Well, we know that the FDA − assuming the theory that the FDA doesn’t believe the label is adequate, what could they have done −

[Plaintiffs’ Counsel]: They could −

JUSTICE SOTOMAYOR:   − absent the study?

[Plaintiffs’ Counsel]: They –

JUSTICE SOTOMAYOR: Meaning because the study obviously changed the FDA’s mind. You’re saying, you, [defendant], could have done it.

[Plaintiffs’ Counsel]: Yes. . . .

Albrecht Tr. at 57.  When that happened to Rick Perry, his response was “Oops.” At least counsel recovered to answer the question more thoroughly.

Justice Ginsburg was absent, and Justice Thomas, as usual, asked no questions.  The usual split would have Justice Ginsburg voting against preemption and Justice Thomas voting for it.

Anyway, we’re not in the business of predicting Supreme Court results. But all in all, after the oral argument, I’d much rather be on our side than not.

We’ve blogged a number of times about the Dormant Commerce Clause (“DCC”) as an additional basis for bolstering both preemption and Due Process arguments.  Here’s another prescription drug-based example.

The state of New York decided to impose a special tax on opioid manufacturers to finance various responses to the so-called “opioid epidemic.”  The tax came in the form of an “a $600 million ‘stewardship fund.’”  Healthcare Distribution Alliance v. Zucker, ___ F. Supp.3d ___, 2018 WL 6651682 (S.D.N.Y. Dec. 19, 2018).  There was a problem with that, however.  What happens with business taxes?  They get passed along (like tort verdicts do) in the form of higher retail prices based on increased costs of doing business.  So the New York legislature, to paraphrase Dr. Seuss, “got an idea.  An awful idea.  They got a wonderful, awful idea.”  No, they didn’t steal Christmas, but they decided to prohibit the manufacturers subject to the tax from passing it along to consumers:

In the provision defining stewardship payments, the [New York statute] states, “No licensee shall pass the cost of their ratable share amount to a purchaser, including the ultimate user of the opioid, or such licensee shall be subject to penalties pursuant to subdivision ten of this section.”  Later, in the penalties provision, the Act notes that “[w]here the ratable share, or any portion thereof, has been passed on to a purchaser by a licensee, the commissioner may impose a penalty not to exceed one million dollars per incident.”

Id. at *3 (quoting N.Y. Pub. Health Law §§3323(2), 3323(10)(c)).

New York, however, is only one state.  The taxed manufacturers, by contrast, sell their products nationwide, as authorized by those products’ multiple FDA approvals.  New York has no power, and the statute had no mechanism, to enforce the prohibition against passing along the cost of “ratable shares” of tax liability in any place other than New York.

Enter the DCC.  What New York did, whether by intent or default, was to pass a tax, to the benefit of in-state “opioid stewardship” programs that would inevitably be paid for solely by opioid consumers in other states, as to whom the statute’s no-pass-through prohibition did not operate.

That arrangement, the court in Healthcare Distribution held, is a burden on interstate commerce that is unconstitutional under the DCC.  First, neither New York, nor any other state, can enact extraterritorial burdens on interstate commerce:

The absolute constitutional prohibition on state regulation of commerce occurring beyond the state’s borders is clear. . . . A statute that directly controls commerce occurring wholly outside the boundaries of a State exceeds the inherent limits of the enacting State’s authority and is invalid regardless of whether the statute’s extraterritorial reach was intended by the legislature. The Constitution is concerned with the maintenance of a national market for interstate commerce. Therefore, even if a statute may not in explicit terms seek to regulate interstate commerce, it can do so nonetheless by its practical effect and design.

Id. at *16 (citations and quotation marks omitted).  Second, states may not discriminate against interstate commerce – such as by imposing taxes that exempt in-state commerce:

The Dormant Commerce Clause also contains an antidiscrimination principle. . . .  [S]tates are aware of the obvious constitutional problems of tariffs. . . .  Instead, the cases are filled with state laws that aspire to reap some of the benefits of tariffs by other means. . . .  [The DCC] examin[es] whether the challenged action shifts the costs of regulation onto other states, permitting in-state lawmakers to avoid the costs of their political decisions. If a regulation unambiguously discriminates in its effect, it almost always is invalid per se.

Id. (citations and quotation marks omitted)

Imposing burdens solely on interstate commerce is precisely what New York’s tax on opioids – combined with the no-pass-through provision limited to New York – did:

[When the statute’s] provisions are given their clearest meaning, the Dormant Commerce Clause violation is clear.  An opioid manufacturer based in Maine that wished to pass on the surcharge it paid on New York transactions by selling opioids at a markup to a pharmacy in New Mexico could face a million-dollar penalty from New York State.  While the statute may not in explicit terms seek to regulate interstate commerce, that it does so nonetheless by its practical effect and design” is abundantly clear.

Id. at *17 (citation and quotation marks omitted).  That’s the regulatory part.  If, however, the statute were construed not to apply to interstate commerce so as to avoid the Scylla of extraterritoriality, it falls directly into the Charybdis of discrimination:

If the [New York statutory] pass-through prohibition applies only to in-state purchasers, New York would clearly reap some of the benefits of tariffs by other means.  New York opioid customers would be protected from any price increases in their purchases, and New York would receive a source of funding subsidized by the out-of-state purchasers of opioids. . . .  [O]ut-of-state drug purchasers, with no representation in New York’s legislature or executive, would bear the cost of New York’s policy program.  This shifting of burdens and benefits is antithetical to the idea of intra-national free trade and demonstrates why the Dormant Commerce Cause exists, i.e., to prohibit discrimination as to “any part of the stream of commerce − from wholesaler to retailer to consumer.

Id. (citations and quotation marks omitted).

There were a lot of other issues that the court in Healthcare Distribution had to plow through between page *3 and *16, but they were all ultimately invalid procedural roadblocks thrown up by New York in order to protect the unconstitutional windfall it was attempting to confer upon itself (and its citizens) at the expense of the rest of the country – justiciability, the Tax Injunction Act, tax comity, abstention, ripeness, and standing.  If any of those interest you, be our guest.  We’re satisfied with the unconstitutionality of state attempts to tax interstate commerce in prescription drugs.

Over the past few weeks, our loyal readers have descended into “The Lows” and then climbed to “The Highs” with us as we reviewed the 10 worst and 10 best cases of 2018.

If you found yourself wanting more information on these cases and their impact – perhaps with a side of CLE credit – we’re pleased to announce that five of your bloggers (Bexis, Eric Alexander, Steven Boranian, Steve McConnell, and Rachel Weil) will be presenting a free 90-minute webinar on “The good, the bad and the ugly: The best and worst drug/medical device decisions of 2018” on Wednesday, January 16 at 12 p.m. EST.

This webinar is presumptively approved for 1.5 general CLE credit in California, Illinois, New Jersey, Pennsylvania, Texas and West Virginia. For lawyers licensed in New York, this course is eligible for 1.5 credit under New York’s Approved Jurisdiction Policy.

The program is free and open to anyone interested in tuning in, but you do have to sign up, which you can do here.