We’ve heard more about the constitutional “emoluments clause,” Art 1 §9, clause 8, this year than during the entire rest of our legal careers.  But while it’s illegal for anybody working for the U.S. government to accept anything of value from a “foreign state,” that doesn’t make it illegal, unethical, or even particularly noteworthy for a “learned intermediary” to accept things of value from prescription medical product manufacturers – provided, of course, that doing so doesn’t adversely affect patient care.

For example, the FDA knows and accepts that not only patients/subjects in clinical trials, but also physicians/investigators are routinely paid for their trouble. The FDA’s longstanding Guidance for Industry Financial Disclosure by Clinical Investigators does not require disclosure of “normal reimbursable expenditures” that compensate investigators for routine costs, as long as payments do not “exceed reasonable expectations.”  2001 WL 34768176, at *11.  Such expenses aren’t seen as having a “potential for bias.” Id. at *1.  Even interests that could potentially be a source of bias aren’t prohibited, or limited – they must only be disclosed:

  • Compensation the “value of which could be affected by study outcome.”
  • “A proprietary interest in the tested product”
  • An “equity interest in the [study] sponsor.”
  • “Any equity interest in a publicly held company that exceeds $50,000”
  • “Other sorts” of payments with “a cumulative monetary value of $25,000 or more made by the [study] sponsor.”

Id. at *1-2.

Thus, we don’t have much good to say about a couple of Texas district court opinions that would create an exception to the learned intermediary rule whenever the plaintiff’s prescriber has received any sort of compensation.  Not only is creating exceptions to state common-law rules none of a federal court’s business, but such a broad exception is contrary to precedent and totally unnecessary.

Anyway, the first of these cases was Murthy v. Abbott Laboratories, 847 F. Supp.2d 958 (S.D. Tex. 2011).  The plaintiff was a participant in the defendant’s clinical trial, and signed the standard informed consent documents to participate. Id. at 964.  Murthy refused to apply the learned intermediary rule, “first” because the defendant “arguably directly marketed” the drug to the plaintiff “by creating a promotional video,” and “second” because the prescriber – plaintiff’s doctor – “was compensated by [defendant].” Id. at 967.

Murthy then launched into an extended discussion of the “foundations” of the learned intermediary rule under Texas law.  Id. at 967-70.  This exegesis was not necessary.  The Fifth Circuit, whose law Texas district courts are bound to follow, has repeatedly recognized that Texas applies the learned intermediary rule to all prescription medical products.  Pustejovsky v. PLIVA, Inc., 623 F.3d 271, 276 (5th Cir. 2010) (generic drug); Ebel v. Eli Lilly & Co., 321 Fed. Appx. 350, 355-56 (5th Cir. 2009) (branded drug); Ackermann v. Wyeth Pharmaceuticals, 526 F.3d 203, 207-08 (5th Cir. 2008) (same); McNeil v. Wyeth, 462 F.3d 364, 368 (5th Cir. 2006) (same); Porterfield v. Ethicon, Inc., 183 F.3d 464, 467-68 (5th Cir. 1999) (medical device); Skotak v. Tenneco Resins, Inc., 953 F.2d 909, 912 (5th Cir. 1992) (contrast medium); Hurley v. Lederle Laboratories, 863 F.2d 1173, 1178 (5th Cir. 1988) (vaccine).  The only loophole to the learned intermediary rule ever recognized under Texas law is the so-called “mass vaccination” exception – where a nominally prescription product was dispensed with no doctor, and thus no physician-patient relationship, actually present.  See Reyes v. Wyeth Laboratories, 498 F.2d 1264, 1277-78 (5th Cir. 1974).

However, Murthy was bound and determined to change Texas law.  Rather than follow binding Fifth Circuit precedent, the decision latched onto a “recent[]” decision by a “Texas state appellate court [that] recognized an exception to the learned intermediary doctrine.”  Id. at 970.  That was the so-called “direct-to-consumer” (“DTC”) exception where, according to Murthy, “a drug manufacturer practices consumer marketing that fraudulently touts the drug’s efficacy while failing to warn of the risks.”  Id.  After a long paragraph describing the DTC exception, Murthy pointed out (accurately) that the Texas Supreme Court had yet to pass on any learned intermediary rule exception.  Id.

At this point Murthy imitated Captain Kirk – boldly going where no federal court had gone before.  In the absence of on-point Texas precedent, Murthy elected to “consider, among other sources, treatises, law review commentaries, [and] decisions from other jurisdictions.” Id. at 971 (citation and quotation marks omitted).  What followed were several pages (and long footnotes) that resembled what we saw in Perez v. Wyeth Laboratories Inc., 734 A.2d 1245, 1257-59 (N.J. 1999), or State ex rel. Johnson & Johnson Corp. v. Karl, 220 W.Va. 463, 472-75 (W. Va. 2007) – both of which were cited in Murthy – long on rhetoric and citations to law reviews, but notably lacking in precedent that actually did what Murthy was proposing.

What did Murthy propose?

First it jumped on the DTC exception bandwagon.  Id. at 971 (“the Court believes that the Texas Supreme Court will likely agree with the Court of Appeals’ reasoning”).  “By creating and disseminating a promotional video . . ., [defendant] may have circumvented the doctor-patient relationship.” Id.

Then Murthy turned to the “gifts or compensation” that the prescriber-investigator had received for participating in the clinical trial in which plaintiff had been enrolled:

Studies have documented, however, that gifts or compensation from drug companies influence medical professionals’ treatment decisions.  Conflicts of interest also arise when clinicians stand to gain from enrolling their own patients as subjects in clinical trials. Indeed, a doctor who receives gifts or compensation from a drug company may no longer, as the prescriber, stand between the drug and the ultimate consumer, as the doctor has an incentive to prescribe a particular drug or, in this case, enroll a patient in a clinical trial. . . .  Under certain circumstances, when a physician receives compensation or gifts from drug companies, his or her role as the neutral decision-maker may be diminished.  As such, dismissal of [plaintiff’s] failure to warn claim on learned intermediary grounds would not be appropriate at this time.  Rather, the Court would have to examine the factual circumstances surrounding the compensation of [plaintiff’s] physician in order to evaluate whether application of the learned intermediary doctrine is appropriate.

Id. at 971-73 (citations, quotation marks and two gigantic footnotes to “studies” omitted).  In the end, however, all this discussion in Murthy was merely an extended exercise in obiter dictum – a judicial hit and run − as the warning claims in that case had to be dismissed for another reason.  See Id. at 975-76 (all warning claims fail under Texas statutory presumption of adequacy in FDA-approved warnings).

The second case, In re Depuy Orthopaedics, Inc. Pinnacle Hip Implant Products Liability Litigation, 2016 WL 6268090 (N.D. Tex. Jan. 5, 2016) (“DOPHI”), purported to turn Murthy’s case-by-case evaluation into a blanket compensation exception:

Moreover, the learned intermediary doctrine does not apply when a manufacturer compensates a physician or incentivizes him or her to use its product.   Murthy v. Abbott Labs, 847 F. Supp. 2d 958, 971-73 (S.D. Texas 2012).   Because of the relationship between [defendant] and [the prescribers], a fact question exists regarding the legitimacy and objectiveness of [these prescribers] that precludes application of the learned intermediary doctrine as a basis for summary judgment.

Id. at *6.

There are a number of problems with this nascent emoluments exception to the learned intermediary rule.  First, its meager support in Texas precedent was blown away when the Texas Supreme Court unanimously reversed the “appellate court” decision that Murthy had followed and just an unanimously adopted the learned intermediary rule:

[W]e hold that a prescription drug manufacturer fulfills its duty to warn end users of its product’s risks by providing adequate warnings to the intermediaries who prescribe the drug and, once fulfilled, it has no further duty to warn the end users directly. . . .  Our decision to apply the learned intermediary doctrine in the context of prescription drugs, prescribed through a physician-patient relationship, not only comports with our prior references to the doctrine and many years of Texas case law, but it places us alongside the vast majority of other jurisdictions that have considered the issue. . . .  The underlying rationale for the validity of the learned intermediary doctrine remains just as viable today as stated by Judge Wisdom in 1974.

Centocor, Inc. v. Hamilton, 372 S.W.3d 140, 157-58 (Tex. 2012) (long string-cite footnote and quotation from Reyes, supra omitted).

As for exceptions to the learned intermediary rule, the Texas Supreme Court declined to recognize any.  Id. at 160 n.18 (“we need not determine whether Texas law should recognize exceptions to the learned intermediary doctrine”).  Particularly with respect to the DTC exception Centocor held:

We acknowledge that some situations may require exceptions to the learned intermediary doctrine, but without deciding whether Texas law should recognize a DTC advertising exception when a prescription drug manufacturer distributes intentionally misleading information directly to patients or prospective patients, we hold that, based on the facts of this case, no exception applies.

Id. at 162 (footnote omitted)  (emphasis added).  In the omitted footnote the Texas Supreme Court further criticized the decision that Murthy had blithely predicted it would follow, stating “[t]he court of appeals’ reasoning . . . relegates physicians to a mere dispensary role of prescriptions [and] fails to consider the important professional and ethical standards the law requires of physicians.”  Id. at n.24 (citing Texas statutes governing physician conduct).

After the Centocor reversal, the putative emoluments exception to the learned intermediary rule in Texas rests on precisely zero precedent, only the law journal articles and other studies that Murthy used to justify its prediction.

That brings us to the second point.  Perez and Karl, however wrong we believe them to be (and Karl has since been legislatively overturned), were decided by state high courts.  Those courts have the authority to change state law, even changes based entirely on academic musings, if they so decide.  Murthy and DOPHI, being federal district courts exercising diversity jurisdiction, do not have such authority.  We’ve been over this many times before on the blog.  In the words of the Supreme Court:

A federal court in diversity is not free to engraft onto those state rules exceptions or modifications which may commend themselves to the federal court, but which have not commended themselves to the State in which the federal court sits.

Day & Zimmerman, Inc. v. Challoner, 423 U.S. 3, 4 (1975).  The Fifth Circuit, which as we mentioned includes Texas, agrees:

No Texas court has interpreted [the law] that way.  And we see no other sufficiently strong indication to make an Erie guess that the Supreme Court of Texas would do so.  [I]t is not for us to adopt innovative theories of Texas law, but simply to apply that law as it currently exists.

Barnett v. DynCorp International, LLC, 831 F.3d 296, 307 (5th Cir. 2016) (citations and quotation marks omitted).

[I]n hazarding an Erie guess, our task is to attempt to predict state law, not to create or modify it.  The practical effect of adopting an exception like the one [plaintiffs] propose is the creation of a previously nonexistent state law cause of action.  Therefore, [plaintiffs] carry a heavy burden to assure us that we would not be making law.

Memorial Hermann Healthcare System Inc. v. Eurocopter Deutschland, GmbH, 524 F.3d 676, 678 (5th Cir. 2008) (citations omitted).  Accord, e.g., Johnson v. Teva Pharmaceuticals USA, Inc., 758 F.3d 605, 616 (5th Cir. 2014); Demahy v. Schwarz Pharma, Inc., 702 F.3d 177, 184 (5th Cir. 2012); Holden v. Connex-Metalna Management Consulting GmbH, 302 F.3d 358, 365 (5th Cir. 2002); Batts v. Tow-Motor Forklift Co., 66 F.3d 743, 749 (5th Cir. 1995); Solomon v. Walgreen Co., 975 F.2d 1086, 1089 (5th Cir. 1992); Dean v. Dean, 837 F.2d 1267, 1268 (5th Cir. 1988); United Parcel Service, Inc. v. Weben Industries, Inc., 794 F.2d 1005, 1008 (5th Cir. 1986); Galindo v. Precision American Corp., 754 F.2d 1212, 1217 (5th Cir. 1985).

Finally, our third point is that no other state in the union has adopted any sort of emoluments exception to the learned intermediary rule.  Rather, such claims have been occasionally made, and always rejected, in other states.  That’s quite logical.  Unlike the mass vaccination exception, less accepted exceptions involving consumer choice products (contraceptives) or FDA-mandated DTC warnings – or even the New Jersey-only DTC advertisement “exception” – every other purported exception to the learned intermediary rule has at its justification some kind of communication that avoids the physician-patient relationship.  Claims about financial relationships with prescribers don’t do that.  Rather, they seek to attack an existing relationship using emoluments to claim the physician wasn’t “independent” of the drug/device company.  That’s not a proper “exception” to the learned intermediary rule; that’s a causation issue, if anything other than a smoke screen.  To the extent there is ever any evidence of actual influence over a particular patient’s prescription decision, that is more logically dealt with as tending to defeat a causation defense, but it is not a basis to require direct manufacturer-to-patient warnings where a physician/patient relationship has already been established, which is what exceptions to the learned intermediary rule require.

The first cases to assert financial relationships in opposition to the learned intermediary rule were in Ohio.  In Blatt v. Hamilton, 1986 WL 2925 (Ohio App. March 6, 1986), the plaintiff claimed that his prescriber’s receipt of free drug samples meant that the prescriber should be viewed as the defendant’s agent.  The court disagreed:

The mere fact that a salesman of the manufacturing company gives samples to a doctor and the doctor distributes these samples to a patient, without more, does not prove an agency relationship. . . .  There was no evidence that . . . the manufacturer, had control as to whom, when, in what doses, and in what form, topical or oral, the [drug] was prescribed or distributed by [the prescriber].

Id. at *3 (citation omitted).  Then, in Tracy v. Merrell Dow Pharmaceuticals, Inc., 569 N.E.2d 875 (Ohio 1991), the Ohio Supreme Court considered facts quite like Murthy – the prescriber had treated the patient under an investigational research protocol and received a per patient payment from the manufacturer.  Id. at 879.  The receipt of routine research-related compensation did not, Tracy ruled, compromise the prescriber’s independence:

Although [defendant] paid [the prescriber] for each participant in the . . . study program, the evidence does not support a finding that [the prescriber] was an employee of [defendant] or that [the prescriber] was acting under the control of [defendant] rather than as a physician exercising his independent judgment. . . .  [Defendant] did not control [the prescriber’s] judgment, duties and responsibilities as he used [the drug] in the treatment of patients.  Accordingly, we find that [the prescriber] was acting as an independent physician in dispensing [the drug] to [plaintiff], that he was a learned intermediary and that the trial court correctly instructed the jury on the learned intermediary doctrine.

Id.

Participation in clinical trials similarly did not affect the learned intermediary rule in Little v. Depuy Motech, Inc., 2000 WL 1519962 (S.D. Cal. June 13, 2000).  “The Court [was] not persuaded by Plaintiffs argument that [the prescriber] was not an independent intermediary because he was part of an investigational team” that studied the type of product and surgery at issue.  To the contrary, such study “further support[ed] the finding that [the prescriber] knew about the risks associated with such devices,” and thus defeated causation.  Id. at *9.  Likewise, in a Texas trial court decision neither Murthy nor DOPHI cited, the plaintiff “contend[ed] that [defendant’s] alleged . . . misconduct influenced [the prescriber’s] treatment recommendations because of the fees he received.”  Baker v. Smith & Nephew Richards, Inc., 1999 WL 811334, at *24 (Tex. Dist. Harris Co. June 7, 1999), aff’d mem., 2000 WL 991697 (Tex. App. July 20, 2000).  The court gave that allegation the back of its hand.  “This contention has been rejected.”  Id.

In In re Trasylol Products Liability Litigation, 2011 WL 2117257 (S.D. Fla. May 23, 2011) (applying Alabama law), allegations that the prescriber was “biased because he was a consultant for [defendant], and was paid to attend a Trasylol conference” failed to prevent summary judgment under the learned intermediary rule. Id. at *4.

Plaintiff’s assertions that the learned intermediary doctrine should not apply because [the prescriber] is biased and failed to exercise independent medical judgment do not persuade me. . . .  Plaintiff does not offer evidence that [the prescriber’s] choice to prescribe [the drug] for [plaintiff] was not an informed one, or that he did not exercise individualized medical judgment in making that decision.

Id.

In less routine situations, allegations that prescriber held stock in the defendant or received large sums in compensation have not affected the applicability of the learned intermediary rule.  In one of Bexis’ Bone Screw appeals, Talley v. Danek Medical, Inc., 179 F.3d 154 (4th Cir. 1999) (applying Virginia law), the prescriber was a an equity holder in, and a paid consultant for, the defendant.  Id. at 164 (paid to teach surgical procedures, annual $250,000 consulting fee, travel budget, research funds, and 25,000 shares of stock).  The plaintiff argued that, because of these ties, the prescriber “cannot be considered an intermediary, learned or otherwise.”  Id.  Summary judgment under the learned intermediary rule was affirmed because that evidence was not connected to anything that occurred in the plaintiff’s treatment.  “[T]here is no evidence that the consulting relationship between [the prescriber] and [defendant] interfered with [his] independent medical judgment in treating [plaintiff].  On the contrary, the evidence suggests otherwise.”  Id.  Whether financial ties caused injury by lack of “independence” was a “complex question would depend on the nature of the relationship between the manufacturer and the physician and the extent to which the physician was in fact afforded independence in making medical judgments.”  Id. The Trasylol decision followed Talley.  2011 WL 2117257, at *4.

In In re Zyprexa Products Liability Litigation, 2010 WL 348276, at *11 (E.D.N.Y. Jan. 22, 2010) (applying Illinois law), the plaintiff “contend[ed] that summary judgment should not be granted on learned intermediary grounds” because his prescribing physician was “biased” by having “conducted paid research for at least ten pharmaceutical companies, including defendant,” having been “a paid speaker for at least six pharmaceutical companies, including [defendant],” and having “accepting $490,000 in compensation from” drug companies.  Id. at *11.  Such facts did not oust the learned intermediary rule because nothing showed any “bias specific to” the drug or towards the defendant.  Id.

Allegations of compensation of a similar magnitude did not impair California’s learned intermediary rule in In re Vioxx Cases, 2006 WL 6305292 (Cal. Super. Dec. 19, 2006).  A plaintiff argued that his prescriber could “not play the role of learned intermediary because it paid him hundreds of thousands of dollars over the years to conduct research and give lectures.”  Id.  Absent “evidence of actual bias” the compensation didn’t matter:

Payment to a physician, standing alone, does not deprive the physician of learned intermediary status. Such payment for research is a widespread practice, yet the court was unable to find a case where a physician who was paid for research was considered to have abrogated his or her role of learned intermediary.  Therefore, such payments alone do not constitute a “special circumstance” for purposes of setting aside the learned intermediary doctrine.  Indeed, if such payments alone sufficed, a manufacturer would have to obtain the patient list of every physician it pays for research in order to somehow provide direct warnings.

Id.

Nor does Murthy itself have much of a track record.  DiBartolo v. Abbott Laboratories, 914 F. Supp.2d 601 (S.D.N.Y. 2012), rejected Murthy’s rationale notwithstanding plaintiff’s allegation that her prescriber “may have had a direct financial relationship with [defendant].” Id. at 613.

This argument fails on both the law and the facts.  On the law, plaintiff has not cited any New York decision that adopts an exception to [learned intermediary rule] where physicians received compensation from drug manufacturers.  Murthy applied Texas law, and plaintiff has not demonstrated that Murthy is part of any trend supporting an exception . . . where drug manufacturers compensate physicians.  On the facts, moreover, plaintiff’s allegations that [defendant] compensated [the prescriber] are completely speculative, based entirely on what [defendant] allegedly did in other cases involving other physicians.

Id. at 616 (citation and footnote omitted).  Even assuming what plaintiff claimed was true, however, would not oust the learned intermediary rule, because “[i]t is not clear . . . that manufacturer-compensated physicians would in fact neglect their professional duties to an extent that would undermine” the rule.  Id. at 616 n.6.  See also Calisi v Abbott Laboratories, 2013 WL 5462274, at *3-4 (D. Mass. Feb. 25, 2013) (refusing to follow Murthy and rejecting any “physician compensation exception” to the learned intermediary rule).

Finally, similar emolument-related allegations have failed as challenges to otherwise uncontradicted prescriber testimony.  In Eck v. Parke, Davis & Co., 256 F.3d 1013 (10th Cir. 2001) (applying Oklahoma law), summary judgment for the defendant was affirmed under the learned intermediary rule on the basis of the prescriber’s prior independent knowledge of the relevant product risks.  Id. at 1019.  Even with the benefit of a heeding presumption, the plaintiff could not successfully assert the prescriber’s “research for several pharmaceutical companies” as a basis for creating a credibility issue.  Id. at 1024.  Such pharmaceutical affiliations, “standing alone, however, merely offer speculation as to [the prescriber’s] motives for testifying and they are clearly insufficient to call into question either [her]  credibility or the veracity of her statements.”  Id.  “Absent evidence suggesting [the prescriber] was otherwise influenced by the defendants, we . . . find no reason to question her credibility or the truth of her testimony.”  Id.  See Miller v. Pfizer, Inc., 196 F. Supp.2d 1095, 1129 & n.108 (D. Kan. 2002), (“no reasonable jury” could “discredit” unrefuted prescriber testimony based on “bias . . . arising from his business relationship with [defendant], i.e., the fact that at or near the time he prescribed [the drug] for [plaintiff, he] was a paid consultant”), aff’d, 356 F.3d 1326 (10th Cir. 2004).

Based on the above, we believe there is no legal basis for an “exception” to the learned intermediary rule predicated on a prescribing physician having a pre-existing relationship, financial or otherwise, with a defendant manufacturer of prescription medical products.  Perhaps, in an extreme case, there might be actual evidence of bias affecting a particular plaintiff’s medical treatment, but we have yet to see any such case.  Even in the case of significant emoluments, see Talley, Zyprexa, Vioxx, supra, plaintiffs have been unable to establish a jury submissible case of actual, causal bias.  Murthy and DOPHI, exceeded the proper role of federal courts exercising diversity jurisdiction, and their novel predictions are belied by extensive contrary precedent.

When this blogger hears “negligent undertaking,” my mind does not automatically turn to products liability – but rather to pre-teen children. Pre-teen children are at the age where they are asked (actually required) to “undertake” more and more duties and responsibilities. But often these duties are undertaken in a rather haphazard or lackadaisical way that some might say rise to the level of negligence. Dishes with food left on them put back in the cabinet. Wet laundry left in the dryer for more than a day. And as for cleaning up after the dog, well enough said. And as one of the two arbiters of whether such pre-teens have failed to act in good faith, I admit to guilt in an expanding definition of what constitutes negligent undertaking. The New Jersey courts fortunately have stricter and more precise guidelines than mood and level of tolerance on any given day to guide them and those rules led them to dismiss plaintiff’s negligent undertaking claim in Nelson v. Biogen Inc., 2017 WL 1382910 (D.N.J. Apr. 17, 2017).

The product at issue is Tysabri, a drug used to treat multiple sclerosis. Patients who test positive for anti-JC Virus antibodies were shown to be at an increased for developing a certain brain infection with use of the drug. Id. at *1. Plaintiff contracted the infection after being treated with the drug for three years.

It is worth pointing out some of the procedural history here to understand that his was a bit of a hail-Mary by the plaintiffs. Plaintiff’s initial and first amended complaints contained a claim for negligence that was dismissed because in New Jersey the sole remedy for products liability is the New Jersey Product Liability Act (NJPLA). Id. at *2. All products liability claims, except express warranty, are subsumed by the Act. So plaintiff’s second amended complaint alleged design defect and failure to warn under the NJPLA. Defendants moved to dismiss the design defect claim as preempted and plaintiff withdrew the claim before the court could rule on the motion. Id.   Which left plaintiff with only a failure to warn claim in his third amended complaint. After two years of discovery, plaintiff moved to amend his complaint for a fourth time, this time to add a negligent undertaking claim.

The basis for the claim, argued plaintiff, was that defendants had entered into a licensing agreement with the NIH to allow defendants to use the NIH’s JC virus antibody assay to develop the assay for commercial use. The assay would allow doctors to test for the antibodies to determine if their patients were at an increased risk for the brain infection. Id. The licensing agreement was entered into in 2006 and defendants released their JC virus antibody assay in 2012. Plaintiff alleges that when defendants entered into the licensing agreement, they were voluntarily undertaking the duty to develop the assay and that they failed to do so in a reasonable and timely manner. Id. at *3.

First, the court held that this negligent claim, like the negligence claim in plaintiff’s original complaint, was preempted by the exclusivity of the NJPLA. Plaintiff argued that negligent undertaking was different than other negligence claims because it is not based on a pre-existing duty. Not only did plaintiff have no New Jersey or other authority for this argument, it is a distinction without merit. As the court pointed out, “the application of the NJPLA is not premised on the timing of the duties incurred.” Id. at *4. Further, most duties (unlike those in my household) are at some point voluntarily assumed. “For example, before Defendants decided to develop, market, and sell Tysabri, they had no duty to do so. Once Defendants voluntarily decided to produce Tysabri, they then had a duty to act with reasonable care in doing so.” Id. Negligent undertaking is precluded by the NJPLA.

Second, the court found it would be an unprecedented expansion of liability to use negligent undertaking to create third-party negligence obligations to non-parties to the license, or indeed to any contract.  Plaintiff cited no cases in which a party who agreed to a license was held liable for negligent undertaking. Id. at *5. Acknowledging significant policy concerns, the court suggested that the more appropriate way to address issues of the type raised by plaintiff would be to deal with them specifically in the contract. The NIH could have included a time limit by when defendants should have developed the assay or the license would be revoked. Id.

Further, plaintiff failed to allege an essential element of negligent undertaking – reliance. Id. at *6. Plaintiff alleged that his status as a third-party beneficiary to the license agreement satisfied the reliance requirement, but he cited no authority for that proposition. So, closely adhering to the Erie doctrine, the court concluded that “If the courts of New Jersey believe that such an extension is appropriate, then they are in a better position to expand their own common law in the first instance.” Id.

This means plaintiff is back to his third amended complaint – failure to warn only. And as we just reported last week, there is good precedent on the adequacy of the Tysabri warnings and on Wyeth v. Levine preemption. And precedent has much more bearing in the courtroom than in the laundry room – where when prior rulings are cited to the judges they can be summarily ignored with a simple – “that was then, and I’ve changed my mind.”

 

We aren’t going to mince words today. We don’t like Christiansen v. Wright Medical Technology Inc., MDL 2329, 2016 U.S. Dist. LEXIS 46409 (N.D. Ga. Apr. 5, 2016). It is an opinion on post-trial motions in a case that went to trial in the Conserve Hip Implant Products Liability Litigation. It’s a beautiful spring day here in the Mid-Atlantic and we hope that’s true where you are. If it is, and if anything in this post makes you interested in the greater details and nuances of the decision, we recommend taking it outside, sitting under a tree, and enjoying some fresh air. You should at least have pleasant surroundings while you try to get through it. It’s long, and tedious, and frankly, muddled. So, we are going to try to focus in on the key parts – so that we might also try to get out and enjoy some of this fine weather.

Christiansen is a hip implant case. It went to trial on 5 theories of liability: strict liability design defect, negligent design defect, fraudulent misrepresentation, fraudulent concealment, and negligent misrepresentation. Id. at *2-3. Apparently the court had dismissed plaintiff’s failure to warn claim on summary judgment. Id. at *69 n.18. The jury ultimately returned a verdict finding the hip implant was defectively designed and caused plaintiff’s injuries and awarded $550,000 in compensatory damages. The jury also found in favor of the defendant on the fraudulent misrepresentation and concealment claims, but awarded another $450,000 to plaintiff on his negligent misrepresentation claim and $10 million in punitives. Id. at *18.

But that wasn’t the jury’s first verdict. It’s first verdict, delivered days earlier, answered the first question on the Verdict Form – do you find the hip implant was defectively designed – in the negative. Id. at *6. While that should have been the end of the inquiry, the jury didn’t understand the instruction to not go any further and they kept answering the verdict form. So, they went on to find that defendant had made negligent misrepresentations and awarded plaintiff $662,500 in compensatory damages and $2.5 million in punitives. Id. at *7.

Continue Reading Georgia MDL Court Muddles Utah Law

Once upon a time there was a federal judge . . . . When we were little, we liked it when our mom spun free-form fairy tales for us.  We would contribute the object of the “was” (“Once upon a time there was a . . . bullfrog”), and she would make up the rest as she went along.  Which is fine for mommies, but less so for federal judges, as today’s (very short) case illustrates.

In Fay v. Depuy Orthopedics, Inc., et al, 2015 U.S. Dist. LEXIS 175344 (D.N.D. June 11, 2015), plaintiff’s hip was replaced with a metal-on-metal hip system.  The system consisted of various components, two of which were at issue:  the femoral head and the acetabular cup.  Both components come in various sizes, but, for the system to work correctly, matched sizes of the two components must be implanted in the patient.

In Fay, it was undisputed that Plaintiff received mismatched components and had to undergo revision surgery.  One of the defendants was a distributor that marketed and sold the system. Plaintiff’s surgeon testified that two specific sales reps employed by the distributor were always in the operating room when he implanted that particular hip system.  According to the surgeon (who was not sued), the reps were responsible, based on a process called “templating” of the patient’s x-rays, for placing an appropriate range of sizes of the two components on a table in the operating room before the surgeon arrived.  From the prepared template, the surgeon would determine what size acetabular cup would be implanted, and would ask for that size cup and the correspondingly-sized femoral head.   The sales reps were allegedly responsible for selecting the components from the implant table, verifying for both that they had pulled the size the surgeon requested, and handing the packaged components to the circulating nurse, who unpacked them and placed them in the sterile field.  In the absence of sales reps, the circulating nurse would be responsible for selecting the correct sizes of components.

Continue Reading Sales Reps Denied Summary Judgment in Artificial Hip Case Despite Absence of Legal Duty to the Plaintiff

Way back when – before Restatement (Second) of Torts §402A (1965) crystallized the concept of strict liability – courts around the country were poking around, trying to come up with viable theories of what we would now call “product liability.”  One method that gained some traction, prior to the advent of strict liability, was to strip contractual implied warranty of its historical requirement that the buyer and seller have been in “privity” (that is, that they dealt directly with each other).  New York was one of the states that started down that road.  In Goldberg v Kollsman Instrument Corp., 191 N.E.2d 81 (N.Y. 1963), the court held 4-3 that the manufacturer of a “thing of danger” (not otherwise defined, but in Goldberg, an airplane part that allegedly caused a crash) could be liable for breach of implied warranty without being in contractual privity with the plaintiff.  Id. at 83 (“at least where an article is of such a character that when used for the purpose for which it is made it is likely to be a source of danger to several or many people if not properly designed and fashioned, the manufacturer as well as the vendor is liable, for breach of law-implied warranties, to the persons  whose use is contemplated”).  This was problematic, because until §2-318 was amended in 1975, New York’s UCC hadn’t done away with privity in all personal injury cases.

But along came strict liability, and New York’s tentative steps down the road of privity-less implied warranty were largely forgotten.  Nobody paid much attention to warranty in the Empire State until the Court of Appeals held that strict liability and implied warranty were “not identical” in Denny v. Ford Motor Co., 662 N.E.2d 730, 739 (N.Y. 1995), in that strict liability utilized a risk/utility approach whereas implied warranty focused on consumer expectations.  Id. at 736.  While this distinction “may have little or no effect in most cases,” it can in some.  Id. at 738.

Continue Reading The Citadel Revisited – New York’s “Thing of Danger” Privity Exception Is Obsolete (and Another New York Note)

The Judge in the ObTape device litigation has allowed another manufacturing defect claim to go to trial with no direct evidence that the device implanted in the plaintiff had a manufacturing defect.  See In re Mentor Corp. ObTape Transobturator Sling Prods. Liability Litig., 2015 U.S. Dist. LEXIS 140263 (M.D. Ga. Oct. 15, 2015).  In denying the manufacturer’s motion for summary judgment, the court relied solely on a review conducted by plaintiff’s experts of sample ObTape devices—that is, devices other than the one implanted in the plaintiff.  The experts found that the pore sizes of those other samples were at times outside of the alleged manufacturing requirement of 40 to 100 microns.  Relying solely on this, the court rejected the manufacturer’s argument that plaintiff had not shown a manufacturing defect in the device implanted in her.  The court explained its reasoning, which from our point of view is less than convincing:

One way to prove a manufacturing defect is to test the specific subject product against manufacturing standards.  For example, in BIC Pen Corp., the parties tested the cigarette lighter that caused the plaintiff’s injuries.  346 S.W.3d at 540-41.  But Mentor [the manufacturer of ObTape] did not point the Court to any authority that such testing is the only way to establish a manufacturing defect under Texas law.  Here, Mrs. Sanborn relies on the same evidence as the Phase I Georgia Plaintiffs, whose specific ObTape was not tested, either.  Rather, their experts tested a number of ObTape samples and concluded that a substantial portion of each ObTape tested had pores smaller than 40 microns.  In re Mentor, 711 F. Supp. at 1376.  At this time, the Court remains satisfied that this evidence is sufficient to create a genuine fact dispute on Mrs. Sanborn’s manufacturing defect claim.  Mentor’s summary judgment motion on the manufacturing defect claim is thus denied.  The Court may reconsider this issue when ruling on any motion for judgment as a matter of law that may be presented at trial.

Id. at *8-9.

Continue Reading MDL Judge Allows Manufacturing Defect Claim to Go to Trial with No Direct Evidence of a Defect in the Device Actually Implanted in Plaintiff

It wasn’t a complete win, but the summary judgment outcome in Rheinfrank v. Abbott Laboratories, Inc., ___ F. Supp.3d ___, 2015 WL 4743056 (S.D. Ohio Aug. 10, 2015), has to put a spring in the step of the defendants as they approach trial.  What’s left doesn’t strike us as a very good warnings case.  Rheinfrank involved claims that the antiepileptic drug Depakote caused the minor plaintiff’s birth defects.  Make no mistake about it, Depakote has a known association with such injuries.  First approved in 1983, it’s been a Pregnancy Category D drug since 1988, meaning, according to FDA regulations, that:

there is positive evidence of human fetal risk based on adverse reaction data from investigational or marketing experience or studies in humans, but the potential benefits from the use of the drug in pregnant women may be acceptable despite its potential risks.

21 C.F.R. §201.57(c)(9)(i)(A)(4).  Not only that, since 2003, this drug has carried a black box “teratogenicity” warning, as well as other quite explicit, and all-caps, language to the same effect.  For details, see 2015 WL 4743056, at *2-3.

Plaintiff-mother had used Depakote for years, through four previous uneventful pregnancies.  Id. at *1.  On her fifth pregnancy, even though Depakote came with all these warnings, she continued to take it.  Id.  Her allegations did try to change the subject, however.  In addition to claiming that the black box warning (more about that later) and all the other teratogenicity language were inadequate, she asserted that the defendants failed to warn altogether about “developmental delay.”  Id. at *5.

Continue Reading Preemption (and Other Things) Defanging Depakote Claims

This post is from the non-Reed Smith side of the blog.

In the latest decision from the Pelvic Mesh MDL, the court ordered a consolidated trial of no fewer than thirty-seven plaintiffs with nothing in common save claiming injury from the same product.  See Mullins v. Ethicon, Inc., C.A. No. 2:12-cv-02952, slip op.  (S.D.W. Va. Aug. 4, 2015).  The consolidation is an attempt at a Rule 23(c)(4) single-issue class certification without the class action – since class actions are never certified anymore in personal injury prescription medical product litigation (as demonstrated here).  To reach the same procedural result, Mullins limits consolidation to defect/breach of duty and “general causation”:

[T]he consolidated trial will only involve . . . issues concerning the design of the [defendant’s mesh]  and whether that design was reasonably safe.  Determining reasonable safeness necessarily involves consideration of the [product’s] capability to cause injury.  As a result, causation will be relevant to the consolidated trial but only in the general sense. In other words, the pertinent issue will be whether the [product] can cause injury (general causation), not whether it did in fact cause injury to a particular plaintiff (specific causation).

Mullins, slip op. at 5 (citation omitted).

Continue Reading Further Deconstruction of the Law in Pelvic Mesh

Yes, we’re well aware of the latest development in the Pelvic Mesh MDL.  See Mullins v. Ethicon, Inc., C.A. No. 2:12-cv-02952, slip op. (S.D.W. Va. Aug. 4, 2015).  However, due to Reed Smith’s Pelvic Mesh representations, we’re constrained in what we can say.  We’ll just have to let prior, non-Mesh posts speak for us on Mullins.  We’ve already blogged on consolidation.  We’ve already blogged about Restatement (Second) of Torts §402A, comment k (1965).  We’ve also blogged about the appropriate application of Erie principlesMullins implicates all of these issues.  We’d like to say more, but our obligations to our clients must take precedence.

Since the inception of the blog we’ve taken interest in “flip side” lawsuits in which a plaintiff sues one of our manufacturer clients making allegations diametrically opposed to what we  usually see in product liability litigation – that, far from being injurious or “defective” − our client’s product is so valuable that the plaintiff can’t do without it, and is suing because of some threat to his/her supply of that product.

The first time we commented on such suits, the plaintiffs were suing the government, claiming a constitutional right to try investigational drugs.  We opposed that, knowing that, were such a right recognized, our clients would be the next targets of such constitutionally empowered plaintiffs, because our clients, not  the government, had the drugs in question.  The courts ultimately said “no,” see Abigail Alliance v. von Eschenbach, 495 F.3d 695 (D.C. Cir. 2007), but the lawsuits followed anyway.  Most of these cases involved desperately ill people grasping at investigational straws because there was no cure (or even reliable treatment) for their conditions (muscular dystrophy, multiple sclerosis, and similarly devastating and fatal conditions).  We summed this kind of litigation up recently in reviewing the first comprehensive law review article on the subject.

Continue Reading Still No Duty To Supply Drugs – In 22 States