Just two days ago, Bexis lowered the boom on the Third Circuit’s recent decision in Cottrell v. Alcon Labs, ___ F.3d ___, 2017 WL 4657402 (3d Cir. Oct. 18, 2017).   In a 2-1 decision, the Cottrell court permitted the plaintiffs to proceed on the notion that making eye drop drips bigger than they have to be is a consumer protection violation.  To Bexis’s eyes, that decision was blind to the lack of standing, the absence of any “substantial economic injury,”  and the FDA’s non-approval of eye drop drips of the “smaller” size plaintiffs claim it is somehow illegal not to make under state law.  It turns out that there is someone else out there even more unhappy with the Cottrell decision than Bexis: the defendant.  Now we have the defendant’s Petition for Rehearing and Rehearing En Banc,  https://www.druganddevicelawblog.com/wp-content/uploads/sites/30/2017/11/Cottrell-rehearing-petition.pdf which makes an insightful and compelling case for undoing the panel’s decision.

 

Two preliminary matters are worthy of comment before we tell you what the Petition said. First, we have been so unkind about the Third Circuit’s error in the Fosamax case that we managed to attract the attention of the excellent CA3 blog.   In that blog, the author wondered whether our dissection of Fosamax was perhaps a bit more violent than necessary.  The author also wondered whether we were coming close to accusing the court of bad faith.  Yes to the former, but definitely No to the latter.  As we told the CA3 blog, we took issue with what we saw as bad reasoning, but never-ever thought there was any bad faith.  (The CA3 blog was generous enough to print our disclaimer.  Thanks for that.)  By and large, we are mighty proud of our home circuit.  We know several of the judges, and every one of them is honorable, hard-working, and much smarter than we are.  Sometimes we are not going to agree with the court’s decisions.  Luckily for us we work in a profession and live in a country where debate and criticism are allowed.  Second, succeeding on a petition for rehearing and rehearing en banc is not easy.  When we clerked for Ninth Circuit Judge William Norris, it seemed there was a presumption against such petitions.  Who wants to admit they were wrong?  And yet we remember one time our judge was on a panel where things strayed from the norm.  Another member of the panel (who will remain unnamed) loved to decide cases before oral argument and draft a memorandum disposition rather than a bench memorandum.  This judge prided himself on having almost no backlog.  He pushed for deciding a particular contract dispute via a mere memorandum disposition, not a published opinion, because he saw the issues as being too obvious and insignificant for the Federal Reporter.  And so a memo dispo issued.  But then the losing party filed a petition for rehearing that was not only insistent, but it made a lot of sense.  We met with our Judge in his chambers to talk it over.  The telephone rang.  It was the third member of the panel, who began by saying, “Bill, I think maybe we got one wrong.”  The two judges confabbed, and then set about persuading the third to change his mind and change the outcome.  It took some arm-twisting, but in the end, justice was done.  A mistake led to a proud moment.  By the way, the Ninth Circuit Judge who called our Judge was Anthony Kennedy.  He is now on the U.S. Supreme Court.  So whenever we hear criticisms of Justice Kennedy for fence-sitting, or for grounding some of his opinions in “the right to define one’s own concept of existence, of meaning, of the universe, and of the mystery of human life” or, much worse, international law, we recall his extraordinary integrity and modesty, and how he was supremely interested in getting things right.

 

Back to the Cottrell Petition. The main points in favor of revisiting the Third Circuit’s decision are that it is contrary to Finkelman v. National Football League, 810 F.3d 187 (3d Cir. 2016), it “radically expands Article III standing,” and that it directly conflicts with Eike v. Allergan, Inc., 850 F.3d 315 (7th Cir. 2017).  Moreover, the plaintiff’s inherently speculative theory of injury in fact was rejected by federal courts in Massachusetts and Missouri.  (When a court comes out with a more pro-plaintiffy position than courts in Massachusetts and Missouri, that’s really saying something.)  That theory was also rejected by the district court in Cottrell.  And then the Third Circuit reversed that rejection.  

 

Remember that the Cottrell plaintiffs did not claim that the medications caused them physical harm or were ineffective in treating their eye conditions, or that the defendants misrepresented or omitted any information about the medications or the number of doses expected.  Rather, the plaintiffs simply insist that smaller eye drops would have cost them less.  How is that any different from the Third Circuit’s earlier, controlling Finkelman case, where the plaintiffs had purchased two Super Bowl tickets on the resale market for $2,000 each, and contended that the National Football League had violated New Jersey’s ticket law by not offering at least 95% of tickets to the general public and instead withholding most tickets for league insiders?  The plaintiff in Finkelman alleged that the NFL’s conduct had caused him injury by reducing the supply of tickets, thereby driving up the cost of tickets on the resale market.  The Third Circuit in Finkelman held that the plaintiff lacked standing because the injury was wholly speculative.  Sure, maybe the NFL’s withholding of tickets increased prices on the resale market, but “it might also be the case that it had no effect on the resale market,” and indeed tickets might even have been more expensive in plaintiff’s hypothetical resale market, as members of the general public may have greater incentives than league insiders to resell at high prices.  (We have to admit that, as residents of Philadelphia, where the local team has the best record in the entire NFL, the availability of Super Bowl tickets is a much, much bigger issue to us right now than the size of eye drops.)

The Petition makes the point that, just as in Finkelman, other market effects might have produced a result very different from what the plaintiffs theorized.  In Cottrell, the plaintiffs essentially presumed that the defendants price their products solely according to volume, such that “changing the eyedropper size would not change the price of the medicine, while extending the useful lifespan of each bottle, driving down [the plaintiffs’] aggregate costs.” But it is just as likely that use of smaller drops would prompt use of different sized containers, or that smaller drops would result in a higher price – because of more doses – for the same container.  Who knows?  All we do know is that the allegations of the complaint do not “affirmatively and plausibly” add up to an “injury” caused by the defendant’s conduct.  

The Petition nicely captures the absurdity of the Third Circuit’s analysis, under which consumers suffer Article III injury from “unfairness” whenever they “walk into a supermarket and buy a product — from toothpaste, to ketchup, to deodorant, to hairspray — so long as they can then conceive of a way that the product might be dispensed more efficiently.”  The Petition also nicely exposes the weakness in the Third Circuit’s effort to distinguish away the Seventh Circuit decision in Eike.  According to the Cottrell majority, Eike “seemed to begin its standing analysis with a determination that the plaintiffs had ‘no cause of action.’” But while it is true that the Seventh Circuit did (correctly) conclude that the plaintiffs had “no cause of action,” the Seventh Circuit also separately held that there was no Article III injury, without ever suggesting a causal connection between the two.  Eike, 850 F.3d at 318.  The Seventh Circuit got it fundamentally right when it held that the fact that a seller does not sell the product that you want, or at the price you’d like to pay, is not an actionable injury; “it is just a regret or disappointment.” 

As residents in, and fans of, the Third Circuit, the Cottrell decision certainly is cause for “regret and disappointment.” We called this post a “second look” at the eye-drop litigation.  It is the second look we have taken at the Cottrell case.  We hope that the Third Circuit takes a second look.      

 

 

Last month we brought you word of an excellent result (preemption) in a ridiculous case − a class action claiming that the drops in eye-drops are too big.  That decision was in accord with an earlier decision likewise dismissing such claims on preemption grounds. See Thompson v. Allergan USA, Inc., 993 F. Supp.2d 1007 (E.D. Mo. 2014) (discussed here).

However, there is another ground on which these bottom-feeding actions have been dismissed – lack of sufficient injury to support standing.  After all, the concept of some sort of ideal “price” for a product, above which it is improper to charge is a will-o-wisp, apparently knowable only to plaintiff-side experts (just ask them, they’ll tell you).  This is called “benefit of the bargain” by such experts.  Courts tend to use a different description – “absurd.”

[Plaintiff] received the drug she was prescribed, the drug did the job it was meant to do . . ., and it caused no apparent physical injuries. Under such circumstances, there could be no ascertainable loss. . . .  The Court believes Plaintiffs’ proposed liability theory, which requires no demonstrable loss of any benefit, would lead to absurd results and holds that Plaintiffs fail to state a claim as a matter of law.

In re Avandia Marketing Sales Practices & Products Liability Litigation, 639 F. Appx. 866, 869 (3d Cir. 2016) (citations and quotation marks omitted), affirming, 100 F.Supp.3d 441, 446 (E.D. Pa. 2015), also holding  “absurdity is inherent in the nature of Plaintiff’s claimed loss” because it was “based only on the idea that [the product] is inherently worth some unspecified amount less than whatever Plaintiff might have paid for it”).

That was essentially how the Seventh Circuit reacted to these same eye drop allegations in Eike v. Allergan, Inc., 850 F.3d 315 (7th Cir. 2017) (discussed here).  We described the absurd theory that the plaintiffs were pursuing in our Eike post, and because we’re lazy, we’ll simply repeat that here:

The plaintiffs sued pharmaceutical manufacturers of eye drops used for the treatment of glaucoma because the drops were bigger than they needed to be.  The theory is that the plaintiffs were paying more than they would have if the drops were smaller.  The plaintiffs alleged no conspiracy among the defendants.  This was not an antitrust case. . . .  Nor did the plaintiffs allege any misrepresentations.  Rather, the plaintiffs simply sought, because they thought it would be less expensive, a smaller dose product that nobody made.

The Seventh Circuit essentially agreed: “The fact that a seller does not sell the product that you want, or at the price you’d like to pay, is not an actionable injury; it is just a regret or disappointment − which is all we have here, the class having failed to allege ‘an invasion of a legally protected interest.’”  850 F.3d at 318 (citations omitted).  Accord Carter v. Alcon Laboratories, Inc., 2014 WL 989002, at *4-5 (E.D. Mo. March 13, 2014) (also dismissing identical claim for lack of any cognizable injury).

Apparently, however, the inherent triviality of that claim is no deterrent to today’s class action lawyers, who seem to have nothing better to do than measure the comparative value of eye drop drips.  After several attempts, they seem to have found a couple of judges credulous enough to allow one of these non-injury cases to survive – at least on the standing/injury issue.  That’s today’s case, Cottrell v. Alcon Labs, ___ F.3d ___, 2017 WL 4657402 (3d Cir. Oct. 18, 2017).   Looking to the “scientific consensus on eye drop size,” the majority is willing to let plaintiffs proceed on the notion that making eye drop drips bigger than they have to be is a consumer protection violation.  Id. at *2.  They may proceed even though “no defendant has reduced their products’ drop sizes,” and thus there is no competing product, priced at any price, against which to ascertain the plaintiffs’ purportedly “substantial economic injury.”  Id.  Nor does it appear that the FDA has ever approved – or even had submitted to it – eye drop drips of the “smaller” size plaintiffs claim it is somehow illegal not to make under state law.

The standing question focused on “injury in fact,” and as the party bringing the claim, plaintiffs had the burden of proving standing.  Id. at *4.  To find standing here, the majority (conceding that the district court’s no-standing analysis had “some persuasive appeal”) went deep into the weeds – breaking “injury in fact” into various “components.”  Id. at *5.  The first was a “legally protected interest.”  Conveniently, this allowed the Cottrell majority to base their result on something that prior precedent had “not defined” or even “clarified whether [it] does any independent work in the standing analysis.”  Id.  Presto!  A clean slate on which to build a standing castle in the air.  “[W]hether a plaintiff has alleged an invasion of a ‘legally protected interest’ does not hinge on whether the conduct alleged to violate a statute does, as a matter of law, violate the statute.” Id.  Impressive – this is a holding that the merits don’t matter. We’ll come back to that.

The second aspect of Cottrell’s drawing on a clean slate is “that financial or economic interests are ‘legally protected interests’ for purposes of the standing doctrine.”  Id. at *6.  Well, duh.  That seems like a platitude.  Third, “legally protected interests” can be created by statute, including a state statute.  Id.  That also sounds platitudinous – except Cottrell separates that proposition from any injury.  That comes in the fourth factor – that “interest must be related to the injury in fact” as opposed to being “a byproduct of the suit itself.”  Id.

Having set up this thicket on its clean slate, the court’s actual analysis of the injury requirement’s application to overly large eye drop drips takes only a paragraph:

Plaintiffs claim economic interests: interests in the money they had to spend on medication that was impossible for them to use.  They seek monetary compensation for Defendants’ conduct that they allege caused harm to these interests.  Plaintiffs’ claimed interests arise from state consumer protection statutes that provide monetary relief to private individuals who are damaged by business practices that violate those statutes.  These claims fit comfortably in categories of “legally protected interests” readily recognized by federal courts.

Id. (citing Cantrell v. City of Long Beach, 241 F.3d 674, 684 (9th Cir. 2001)).  Wow!  At that level of generality, any claim that anything for any reason should have been made differently or priced differently confers standing.  That no such alternative product exists is of no bearing.  This breathtakingly broad holding means that the amount of harm to the “economic interest” being undefinable has no bearing.  That the “business practices” at issue were a consequence of the FDA-approved design of the product has no bearing.  These are presumably “merits questions” that court already divorced from standing by putting that rabbit in the hat in its “first” stroke on the blank slate – that merits don’t matter.

We’ve seen this sort of credulous avoidance of merits questions before in class actions before.  Remember how courts for decades misinterpreted Eisen v. Carlyle & Jacqueline, 417 U.S. 156 (1974), to find that class certification can’t look at the merits?  That was finally interred once and for all in Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 351 & n.6 (2011), but now we see it popping up again on this supposed standing blank slate.

It’s not really a blank slate, however.  The Third Circuit, and many other courts, have held that TwIqbal “plausibility” requirements apply to the analysis of standing questions.  “With respect to 12(b)(1) motions in particular, the plaintiff must assert facts that affirmatively and plausibly suggest that the pleader has the right he claims.”  In re Schering Plough Corp. Intron/Temodar Consumer Class Action, 678 F.3d 235, 244 (3d Cir. 2012) (applying TwIqbal pleading requirements to standing analysis in RICO drug pricing class action).  TwIqbal “teach that standing cannot rest on mere ‘legal conclusions’ or ‘naked assertions.’”  Finkelman v. National Football League, 810 F.3d 187, 194 n. 55 (3d Cir. 2016) (citation and quotation marks omitted).

Because Lujan mandates that standing “must be supported in the same way as any other matter on which the plaintiff bears the burden of proof,” it follows that the TwomblyIqbal facial plausibility requirement for pleading a claim is incorporated into the standard for pleading subject matter jurisdiction.  Lujan, 504 U.S. at 561.  Therefore, we join many of our sister circuits and hold that when evaluating a facial challenge to subject matter jurisdiction under Rule 12(b)(1), a court should use TwomblyIqbal’s “plausibility” requirement, which is the same standard used to evaluate facial challenges to claims under Rule 12(b)(6).

Silha v. ACT, Inc., 807 F.3d 169, 174 (7th Cir. 2015) (citing Schering Plough along with many other cases).  “Just as the plaintiff bears the burden of plausibly alleging a viable cause of action, so too the plaintiff bears the burden of pleading facts necessary to demonstrate standing.”  Hochendoner v. Genzyme Corp., 823 F.3d 724, 730 (1st Cir. 2016) (Iqbal citation omitted) (also providing string citation of TwIqbal standing cases).

Along these lines, we also point out that the sole citation in Cottrell supporting its one-paragraph injury in fact analysis, Cantrell, supra, is a Ninth Circuit case, and the Ninth Circuit is the only circuit that does not follow TwIqbal in standing cases. See Maya v. Centex Corp., 658 F.3d 1060, 1068 (9th Cir. 2011) (cited as lone exception in Silha).

Having thus improperly insulated the inherently ridiculous nature of the alleged injury from TwIqbal inspection on standing questions – without even mentioning TwIqbalCottrell then disagrees with Eike for precisely that reason.  To do so, Cottrell splits another hair – distinguishing business practices that are “unfair” under a consumer protection statute from those “that are fraudulent, deceptive, or misleading.”  2017 WL 4657402, at *6.

The plaintiffs in Eike explicitly alleged that the defendants’ practices in manufacturing and selling eye medication were “unfair”. . . .  The Court was obliged to take these allegations as true for purposes of the standing inquiry.

Id.

That is, to be charitable, garbage. “Unfair” by itself is your classic legal conclusion.  Under TwIqbal, legal conclusions have to be accompanied by some factual basis to survive dismissal.  Eike rightly pointed out that, in the absence of any allegation of anything false or misleading about how these products were marketed, an “unfairness” allegation amounted to mere “dissatisfaction with the defendants’ products or their prices.”  2017 WL 4657402, at *6 (describing Eike).

Having thus improperly given the plaintiffs’ inherently implausible theory on “legally protected interest a TwIqbal free pass, Cottrell also waved it through the other injury in fact factors it created.  Most interestingly – because of the dissent – Cottrell attempted to distinguish a prior standing precedent, Finkelman, supra.

[Plaintiffs’] pricing theory is far less speculative than . . . the theory of financial harm we rejected in Finkelman . . ., [where t]he plaintiff claimed that this policy reduced the number of tickets available in the resale market.  Under the basic economic principle of supply and demand then, the policy resulted in an inflated ticket price in the resale market, according to the plaintiff.  We rejected plaintiff’s theory, as the plaintiff pled no facts to support their assertion that [defendant’s] policy would actually reduce the number of tickets in the resale market.

Id. at *9.  Since a “reduced size” of the eye drop drip (produced by a different sized hole in the tip) was the “only change from the status quo” that plaintiffs’ theory in Cottrell required in the majorities eyes, it was less “speculative” than the too-remote theory in Finkleman, and thus “sufficient to satisfy the injury-in-fact requirement.”  Id. at *10.

The dissent saw things differently.  Finkleman was dispositive (“I believe that Finkelman all but decides this case”).  Cottrell, 2017 WL 4657402, at *12 (dissenting opinion).  “We properly recognized that markets operate in complex ways.”  The market forces in Finkleman “made clear that any potentially unlawful conduct by the [defendant] did not necessarily result in higher prices to the plaintiff” and “concluded that we have no way of knowing whether [defendant’s] withholding of tickets would have had the effect of increasing or decreasing prices on the secondary market.”  Id.

[F]or purposes of analyzing economic injuries in the context of marketwide effects, we cannot do precisely what the plaintiffs here ask of us:  isolate and change one variable while assuming that no downstream changes would also occur.  These cases . . . reflect courts’ skepticism about plaintiffs’ ability to satisfy the case or controversy requirement of Article III by relying on such imaginative economic theories.  Thus, contrary to the Majority’s assertion, the plaintiffs’ pricing theory does in fact depend on exactly the sort of presumption rejected by us and by other courts − namely, the presumption that no other aspects of the market would change once the defendants’ conduct did. . . .  Finkelman makes clear that [standing analysis] distinguishes “between allegations that stand on well-pleaded facts and allegations that stand on nothing more than supposition.” . . .  The plaintiffs . . . ask us to assume certain facts about other actors’ behavior − exactly the sort of assumption that cannot be proven at trial. Accordingly, I would reject the plaintiffs’ alleged economic injury as overly speculative and untenable under existing precedent.

Id. at *13 (multiple citation footnotes omitted).

The Cottrell dissent goes on to discuss multiple reasons why plaintiffs’ attenuated economic assumptions are “a particularly bad fit for the market for pharmaceuticals.”  Id.

  • Pharmaceuticals are not priced “by volume;” “unit-based pricing is too one-dimensional for the [pharmaceutical] marketplace.”
  • Pharmaceutical pricing is “value-based”; “measured in part by effective doses.”
  • This pricing “shift . . . sever[s] the link between volume and price upon which the plaintiffs’ alleged injury depends.”
  • “[T]he price of each bottle could actually increase if each bottle provided more doses.”
  • Because plaintiffs’ assumption “does not reflect market conditions and pressures in the pharmaceutical industry,” it would “draw an unreasonable inference about the downstream consequences of” the design change they are demanding.
  • “[U]nreasonable” inferences cannot be accepted “at face value.”

Id. at *13-14 (dissenting opinion).

The dissent is of the view that the majority’s decision conflicts with Finkleman.  We agree, but go further.  We think the entire construct in Cottrell conflicts with prior Third Circuit precedent applying TwIqbal in standing cases because of its holding that the merits – and thus the facts that must be pleaded to establish the “plausibility” of the claim on the merits – don’t matter in standing cases.  Cottrell thus represents, with In re Fosamax (Alendronate Sodium) Products Liability Litigation, 852 F.3d 268 (3d Cir. 2017), the second abrupt pro-plaintiff lurch by the Third Circuit this year, which is less surprising than it might seem, considering the both of the judges in the majority in Cottrell also decided Fosamax.

About the only good thing that can be said about Cottrell is that it did not purport to decide that preemption issue that has also defeated these half-baked dropper drip size allegations.  Id. at *11.  That argument is that design changes affecting the dosage of medication delivered – which is necessarily what plaintiffs’ drop size allegations depend on – are “major” changes that require prior FDA approval, and thus are “impossible” to carry out with the immediacy that state law demands. See Gustavesen v. Alcon Laboratories, Inc., ___ F. Supp.3d ___, 2017 WL 4374384, at *5 (D. Mass. Sep. 29, 2017), and Thompson, 993 F. Supp.2d at 1013-13, as discussed in our prior posts.

We’re quite familiar with people who say one thing, when they think that’s in their interest, and later when circumstances change, say something quite different.  For example, as the late, great Molly Ivins pointed out in “Molly Ivins Can’t Say That, Can She?”,  back during the energy crisis of the mid-to-late 1970s, folks down in Texas “did put bumper stickers on their pickups . . . that said, ‘Let the Yankee Bastards Freeze in the Dark.’” Id. at 43.  As others have pointed out, Hurricane Sandy brought out similar sentiments.  These days, not so much….

But what about in prescription medical product liability litigation?  Say, for example, one of our defense colleagues absolutely nailed it at a deposition.  The result is rock-solid deposition testimony that the prescribing physician never read that allegedly inadequate warning.  Or else it’s the plaintiff admitting that s/he only took the version of the drug manufactured by a different company.  Summary judgment should be a lock. . . .

The motion is filed. The plaintiff’s response, however, includes an affidavit from the same witness already deposed at length – and the affidavit directly contradicts the witness’ prior testimony on which the motion was based.  Plaintiff claims that, now, at minimum, the contradictory testimony creates a “fact issue” and the “credibility” of the two irreconcilable versions of for the jury to decide.

What now?

First of all, it’s happened before – many times.   Almost 20 years ago, the United States Supreme Court addressed the same situation where a plaintiff, having filed for disability (requiring her to swear she was “totally disabled”), and then later filed an age discrimination suit (the matter before the Court), in which she had to prove she was a “qualified person.”  Cleveland v. Policy Management Systems Corp., 526 U.S. 795, 805-06 (1999).  Plaintiffs, the Court held, “cannot simply ignore the apparent contradiction that arises” from taking apparently irreconcilable positions.  Instead, they “must proffer a sufficient explanation” of such discrepancies.  Id. at 806.  The Court endorsed the analogous doctrine that:

[A] party cannot create a genuine issue of fact sufficient to survive summary judgment simply by contradicting his or her own previous sworn statement (by, say, filing a later affidavit that flatly contradicts that party’s earlier sworn deposition) without explaining the contradiction or attempting to resolve the disparity.

Id. (string citation omitted).  See generally, e.g., Perma Research & Development Co. v. Singer Co., 410 F.2d 572, 578 (2d Cir.1969) (generally viewed as the seminal case on sham affidavits) (applying New York law); Shelcusky v. Garjulio, 797 A.2d 138, 144-45 (N.J. 2002) (excellent general citator for sham affidavit decisions).

Enter the sham affidavit doctrine (sometimes elevated to the status of a “rule”), now with Supreme Court imprimatur, precluding creation of “genuine” factual issues by a plaintiff (or some other essential witness) simply contradicting his or her own previous sworn testimony.  The oldest decision we’ve found applying the sham affidavit doctrine in a prescription medical product liability litigation is Miller v. A.H. Robins Co., 766 F.2d 1102 (7th Cir. 1985) (applying Indiana law), where the plaintiff, after testifying that several of her treaters told her that her injuries were caused by the product, submitted an affidavit denying everything once hit with a summary judgment motion raising the statute of limitations.  As one of the opinions that created the sham affidavit doctrine, Miller began with the proposition that “[p]arties cannot thwart the purpose of Rule 56 by creating issues of fact through affidavits that contradict their own depositions.”  Id. at 1104.  The plaintiff was not “confused” while testifying, and “made no corrections to her statements” when the transcript of her deposition was made available.  Id. at 1105.  “Consequently this affidavit did not create a genuine issue of fact and the district court could grant summary judgment.”  Id.

In another relatively old decision – pre-Cleveland, so the sham affidavit doctrine did not yet have the Supreme Court’s endorsement − a plaintiff-affiliated fact witness (the plaintiff’s mother) had her testimony excluded in Martin v. Merrell Dow Pharmaceuticals, Inc., 851 F.2d 703 (3d Cir. 1988) (applying Pennsylvania law, we think).  The witness tried to change her testimony about when she ingested a purportedly teratogenic drug.  The sham affidavit doctrine stopped this attempt:

The numerous other courts of appeals that have considered the situation in which a party contradicts, without satisfactory explanation, his or her prior testimony, have reached the same decision.  Each court has concluded that the objectives of summary judgment would be seriously impaired if the district court were not free to disregard the conflicting affidavit.

Id. at 706 (citations omitted).  “When, as in the present case, the affiant was carefully questioned on the issue, had access to the relevant information at that time, and provided no satisfactory explanation for the later contradiction, the courts of appeals are in agreement that the subsequent affidavit does not create a genuine issue of material fact.”  Id.

According to Westlaw, 128 cases cite Martin for this proposition, but as far as we can tell, only one of those involved prescription medical product liability litigation.  The exception is Rohrbough. Wyeth Laboratories, Inc., 719 F. Supp. 470 (N.D.W. Va. 1989), aff’d, 916 F.2d 970 (4th Cir. 1990), where the court entered summary judgment after excluding an expert witness’ medical causation affidavit because it contradicted prior sworn deposition testimony.  “[I]f a statement in an affidavit that contradicts earlier deposition testimony constitutes an attempt by the nonmoving party to create a sham issue of fact, it may be disregarded.”  Id. at 474. Miller was cited as Seventh Circuit precedent, along with pre-Cleveland decisions from eight circuits (with only one circuit going the other way).  Id.  In stark contrast to the expert’s deposition testimony, which “reveal[ed] a cautious, circumlocutory doctor,” the contrary affidavit was “concise” and “unhesitant.”   “[T]here is no explanation in the affidavit for why [the expert] is suddenly so willing to offer his unqualified opinion . . . when he had earlier only been willing to defer to experts in the relevant field in his deposition.”  Id. at 475.  On appeal, the Fourth Circuit affirmed, also invoking the sham affidavit doctrine:

Given the conflicts between [the expert’s] affidavit and his deposition testimony, the district court was left not with a genuine issue of material fact, but with trying to determine which of several conflicting versions of [the expert’s] testimony was correct.  We hold that the district court was justified in disregarding the affidavit.  We agree with the district court that it may not represent the considered opinion of the doctor himself, but rather an effort on the part of the plaintiffs to create an issue of fact.

Rohrbough v. Wyeth Laboratories, Inc., 916 F.2d 970, 976 (4th Cir. 1990) (citation omitted) (applying West Virginia law).

On the blog, we’ve previously discussed several cases that involved the sham affidavit doctrine, but we’ve never reviewed it more comprehensively.  Most recently, in Redd v. DePuy Orthopedics, Inc., ___ F. Appx. ___, 2017 WL 2859536 (8th Cir. June 6, 2017) (applying Missouri law), the plaintiff’s marginally qualified (if that) design expert changed his tune in an affidavit “submitted after [defendant] moved for summary judgment.”  Id. at *2.  Recognizing that “[a] party may not avoid summary judgment by submitting an affidavit that contradicts rather than clarifies previous sworn testimony,” the court of appeals examined several issues on which the expert’s affidavit changed his testimony.  Id.

Given such differences between the testimony [the expert] provided during discovery and his affidavit, we conclude that the district court did not abuse its discretion by excluding the affidavit from consideration at summary judgment.

Id.  The standard of review is important in sham affidavit cases – exclusion of evidence is governed by abuse of discretion.

Another recent appellate decision reaching the same result is In re Avandia Marketing, Sales Practices & Products Liability Litigation, 639 F. Appx. 874 (3d Cir. 2016) (applying Pennsylvania law), only this time the plaintiff had suborned her prescribing physician to recant his prior testimony under oath.  In deposition, the prescriber had “testified that even if [defendant]  had warned of the risks . . . associated with [the drug], he would still have prescribed the drug to [plaintiff].”  Id. at 876.  After the defendant sought summary judgment, plaintiff offered the prescriber’s affidavit stating that with “a different and more thorough warning . . . he never would have prescribed the drug.”  Id. at 876 n.3.  The district court, and then the Third Circuit, were having none of it.  Again, “[i]t was also within the District Court’s discretion to strike . . . the [prescriber’s] Affidavit, which contradicted [his] deposition testimony.”  Id. at 877.  “This Court defines a ‘sham affidavit’ as a contradictory affidavit that indicates only that the affiant cannot maintain a consistent story or is willing to offer a statement solely for the purpose of defeating summary judgment.  Id. at 877 n.5 (citation and quotation marks omitted).

When a deponent’s post-deposition affidavit conflicts with his prior testimony, a district court may disregard the affidavit to prevent a party from creating a material issue of fact to defeat summary judgment by filing an affidavit disputing his or her own sworn testimony without demonstrating a plausible explanation for the conflict.  A district court may strike such an affidavit based upon the timing of the affidavit, whether any other record evidence supports the affidavit, and whether there is a plausible explanation for the contradiction.  Each of these considerations supports striking the [prescriber’s] Affidavit.

Id. at 877 (footnote, citations and quotation marks omitted).  Needless to say, exclusion of the sham affidavit and summary judgment on causation grounds was affirmed.  Id. at 879.

Ditto in In re Fosamax Products Liability Litigation, 707 F.3d 189 (2d Cir. 2013) (applying Florida law), where yet again the plaintiff induced her prescribing physician to change his deposition testimony and offer conflicting “expert” testimony on causation-related issues “central to [plaintiff’s] failure-to-warn claim” in a subsequent deposition taken after summary judgment was filed.  Id. at 195.  This stratagem was unsuccessful, as the Second Circuit held that the sham affidavit doctrine was nonetheless applicable to preclude plaintiff from relying on the witnesses second, “diametrically different story” in another deposition:

[W]e hold that the District Court was entitled to disregard [this] new testimony relating to his knowledge based on the “sham issue of fact” doctrine, which prohibits a party from defeating summary judgment simply by submitting an affidavit that contradicts the party’s previous sworn testimony.  Although we have typically applied the sham issue of fact doctrine where a party submits an affidavit that contradicts the party’s own prior statements, it may also apply when a party attempts to use evidence from an expert witness to defeat summary judgment.  In particular, the doctrine applies to stop [plaintiff] from manufacturing a factual dispute by submitting testimony from an expert whom she tendered, where the relevant contradictions between the first and second depositions are unequivocal and inescapable, unexplained, arose after the motion for summary judgment was filed, and are central to the claim at issue. . . .  We cannot reconcile his new testimony with his prior testimony.

Id. at 194 (citations and footnote omitted).  See Hickman v. Laboratory Corp., 460 F. Supp.2d 693, 699 (W.D. Va. 2006) (sham affidavit doctrine applied to treating physician’s “affidavit, which was filed only three days prior to the Motion for Summary Judgment hearing, was simply an attempt to add information that [he] failed to provide in his sworn deposition”).

In Ralston v. Smith & Nephew Richards, Inc., 275 F.3d 965, 973 (10th Cir. 2001) (applying Kansas law), the plaintiff’s expert changed his testimony in an attempt to support the sole remaining warning-related cause of action, after having given different testimony when the case seemed focused on design-related issues.  The subsequent “declarations” were disregarded as attempts to create “sham facts”:

[C]ourts will disregard a contrary affidavit when they conclude that it constitutes an attempt to create a sham fact issue. . . .  [Under] the[] circumstances, it is not an abuse of discretion to conclude − as the district court did − that these subsequent affidavits, which directly contradicted certain positions previously taken by [plaintiff’s expert] and which were detrimental to [plaintiff’s] sole remaining cause of action, constituted those kinds of affidavits which fall within the ambit of creating a “sham fact issue.”   Consequently, the district court was entitled to rely on [his] deposition testimony without regard to his later declarations in rendering its summary judgment ruling.

Id. at 973-74.

Another plaintiff expert bit the dust in Kline v. Zimmer Holdings, 2015 WL 4077495 (W.D. Pa. July 6, 2015), a case we discussed here.  Essentially, the expert bailed in her deposition on design defect opinions, and then later tried to resuscitate design issues in an affidavit filed in response to the defendant’s summary judgment motion.  Id. at *4.  After “consistently, carefully, and clearly set forth her opinion that the product, as designed, was not defective” at the deposition,” her contrary “affidavit cannot be considered” to “proffer expert testimony about the design defect claim.” Id.

It is appropriate to disregard her affidavit pursuant to the sham affidavit doctrine.  “A sham affidavit is a contradictory affidavit that indicates only that the affiant cannot maintain a consistent story or is willing to offer a statement solely for the purpose of defeating summary judgment.”  “[I]f it is clear that an affidavit is offered solely for the purpose of defeating summary judgment, it is proper for the trial judge to conclude that no reasonable jury could accord that affidavit evidentiary weight and that summary judgment is appropriate.”

Id. (quoting and following Jiminez v. All American Rathskeller, Inc., 503 F.3d 247, 253 (3d Cir.2007)).  See also Id. at *20 (magistrate’s opinion on same issue).

Still another plaintiff expert, after admitting that there was “no alternative” to the plaintiff undergoing certain medical procedure in his deposition, then tried to deny that same fact after the defendant sought summary judgment.   Zimmerman v. Novartis Pharmaceuticals Corp., 287 F.R.D. 357, 362 (D. Md. 2012) (discussed here).  Following Cleveland, the court invoked the sham affidavit doctrine and held that the “belatedly submitted new affidavit, being flatly contradictory to [the expert’s] deposition testimony, will not be considered.”  Id.

In state court, we encountered the same principle in In re Zoloft Litigation, 2016 WL 5958372 (W. Va. Cir. Oct. 5, 2016), again involving shenanigans by a plaintiff expert.  After being essentially destroyed in deposition, the expert signed an affidavit attempting to repair the damage.  After “not identify[ing] any means by which he was able to exclude other likely causal factors” in his deposition, in his affidavit, the expert professed “that he has excluded all causes other than [the drug].”  Id. at *7-8.  West Virginia’s version of the sham affidavit doctrine asks three questions:

(1) Whether the deposition afforded the opportunity for direct and cross-examination of the witness; (2) whether the witness had access to pertinent evidence or information prior to or at the time of his or her deposition, or whether the affidavit was based upon newly discovered evidence not known or available at the time of the deposition; and (3) whether the earlier deposition testimony reflects confusion, lack of recollection or other legitimate lack of clarity that the affidavit justifiably attempts to explain.

Id. at *8 (quoting Kiser v. Caudill, 599 S.E.2d 826, 828 (W. Va. 2004)).  Answering all these questions “yes,” finding that, since the expert “fail[ed] to offer any explanation for the inconsistency between his deposition testimony and his affidavit,” the affidavit therefore “failed to cure the admissions made during his deposition.”  Id. at *9.  As we discussed at greater length in the other post, exclusion required summary judgment.  Id. at at *10. See also Tortorelli v. Mercy Health Center, Inc., 242 P.3d 549, 561 (Okla. App. 2010) (plaintiff’s expert’s affidavit “directly contradicting prior deposition testimony” on standard of care issues disregarded); Dickenson v. EBI, LLC, 2009 WL 10672211, at *3 (W.D. Mo. July 30, 2009) (affidavit by plaintiff’s expert on design defect disregarded as sham).

Plaintiffs do it too – a lot.  They were caught twice in 2015, in Sparks v. Oxy-Health, LLC, 134 F. Supp.3d 961 (E.D.N.C. 2015), and Muzichuck v. Forest Laboratories, Inc., 2015 WL 235226 (N.D.W. Va. Jan. 16, 2015).  In Sparks the plaintiff unsuccessfully attempted to improve upon deposition testimony involving reliance:

Plaintiff[‘s] affidavit will be struck.  The affidavit provides a number of cursory statements that . . . [she] relied on certain misrepresentations at the time she purchased the [product].  However, at her . . . deposition, plaintiff . . . stated that she relied on her conversations with [a third party] . . . and the tangible benefits [of the product]. . . .  Defense counsel pointedly asked plaintiff if she relied on anything else.  She replied “no.”  There is a “bona fide inconsistency” between the two versions of plaintiff’s testimony.  The affidavit is a sham and accordingly is struck from the record.

134 F. Supp.3d at 998-99.

In Muzichuck, the plaintiff in a wrongful death action admitted in her deposition that the decedent had actually read the product’s package insert.  2015 WL 235226, at *12.  When that admission came back to haunt her, she swore out a contrary “declaration” denying that precise fact.  Id.  The court said, “No way, Jose”:

This attempt by [plaintiff] to create a contested issue of fact by disputing her own earlier deposition testimony is unconvincing. . . .  [She] cannot create a dispute about a fact that is contained in deposition testimony by referring to a subsequent affidavit or declaration of the deponent contradicting the deponent’s prior testimony, for it is well established that a genuine issue of fact is not created where the only issue of fact is to determine which of the two conflicting versions of a party’s testimony is correct.  Therefore, the Court concludes that there is no material question of fact in dispute.

Id. (quoting In re Family Dollar FLSA Litigation, 637 F.3d 508, 512 (4th Cir. 2011)).  For other instances of subsequent statements by plaintiffs being excluded under the sham affidavit rule in prescription medical product liability litigation, see Joseph v. Costco Wholesale Corp., 2015 WL 12745803, at *6 (C.D. Cal. Aug. 27, 2015) (“conclusory, self-serving declaration” regarding reading drug label at time of purchase excluded); Finnicum v. Actavis-Elizabeth, L.L.C., 2011 WL 13193350, at *5-6 (E.D. Tex. Jan. 6, 2011) (affidavit concerning causation knowledge disregarded; controlling law “does not allow a party to defeat a motion for summary judgment using an affidavit that impeaches, without explanation, sworn testimony”); Vitolo v. Mentor H/S, Inc., 426 F. Supp.2d 28, 37 (E.D.N.Y. 2006) (contradictory affidavit about importance of certain manufacturer representations about medical device held a sham), aff’d, 213 F. Appx. 16 (2d Cir. 2007); Reetz v. Jackson, 176 F.R.D. 412, 414-15 (D.D.C. 1997) (contradictory affidavit denying knowledge of FDA held a sham in Bone Screw case); In re A.H. Robins Co., 197 B.R. 495, 498 (E.D. Va. 1995) (excluding, for “egregious inconsistency” affidavit regarding product identification in bankruptcy proceeding); Gehring v. Showa Denko, K.K., 1994 WL 597584, at *3 (E.D. Pa. Nov. 2, 1994) (contradictory product identification affidavit held a sham); Baker v. A.H. Robins Co., 613 F. Supp. 994, 996 n.3 (D.D.C. 1985) (contradictory plaintiff knowledge affidavit not considered).

There are literally hundreds of sham affidavit decisions out there, but nowhere else, to our knowledge, have those only involving prescription medical product liability litigation been collected. Until now.

Like many of you, on Friday mornings we turn to the “Legal Lions and Lambs” section of Law360.  It is not only voyeurism.  We are constantly working on things in media res (the middle of things), building slowly and gradually to a climax that  hardly ever arrives.  Ninety percent of cases settle, and that is seldom the stuff of Lions or Lambs. Nope: the Lions vs Lambs dichotomy is about winning and losing.  Not in any subtle sense, either.  The Law360 column focuses on trial verdicts or dispositive motions.  Those outcomes furnish teaching moments, points of inspiration, object lessons, or cautionary tales.  We have never personally shown up on either side of the list as far as we know, mirabile dictu (wonder to say – surely mastery of Latin is a mark of a Legal Lion, no?), given that we played a minor role in that vast stain on Anglo-American jurisprudence not-so-fondly remembered as the Engle tobacco litigation in Miami).
We know this much: we’d rather be a Lion than a Lamb. The Lion is king of the jungle. MGM pictures start majestically with a roaring lion.  King Richard was lion-hearted.  The hero in the best Disney animated movie was a lion. So was Barry Sanders.  By contrast, Lambs get led to the slaughter.  We count them as we try to fall asleep.  Their silence is the central image to the creepiest movie we have ever seen.  Worst of all, we garnish lamb chops with mint jelly.
Over the last couple of weeks, we saw some entries in the “Lambs” section that caught our attention because they involved lawyers we know and respect.  These lawyers defended drug or device companies that got tagged by juries with eye-popping verdicts.  These defense lawyers are, to put it plainly, great lawyers.  We co-tried, and won, a case with one of them, and counted two others as colleagues in the US Attorney’s office a long time ago.  Their skills are extraordinary.  They possess exquisite judgment, work hard, and give their clients the best possible representation.
And they lost the cases that landed them in Law360.  (One of them, by the way, had won a similar case a couple of months before – the first defense lawyer to do so.  Before he was a Lamb, this lawyer was a Lion). Suddenly, we decided that we disliked the “Lambs” label.  Law360 surely does not mean to insult anyone in the Friday column, but there is something undeniably negative about the “Lambs” term, and undeniably unfair.  We bet those lawyers on the losing end went down, not meekly, but swinging.
The fact is that great lawyers occasionally lose cases.  Why?  To begin with, great lawyers are given the hardest and most important cases.  We know a very smart in-house lawyer (in fact his company was involved with one of the cases that caught our attention in the Lions and Lambs column) who likes to ask lawyers begging for business from him to name their worst loss.  Too many lawyers pretend they have never lost, or immediately show their insecurity by ladling on the excuses. But think of the two or three best trial lawyers you have ever encountered.  Maybe there is a plaintiff lawyer in Houston with a photographic memory and unsurpassable eloquence. Maybe there is a corporate defense lawyer in Chicago who possesses laser-like focus and terrifying tenacity.  They have both been brutalized by juries. That is true for just about every other trial lawyer who has earned a glistening national reputation. Some cases are simply too hard. Some judges are simply too biased.  Or, most often, some juries are simply too batty.
When we consider our worst loss, we usually reflect on a near miss. (Right – we are cheating.)  We tried a case against one of the most unpleasant lawyers we have ever met.  You couldn’t trust his word.  He said things in open court that the Judge had explicitly ruled out of bounds.  But before violating the ruling, this lawyer would keep challenging it.  Again and again.  Every day was a new day.  (The rotten thing was that half the time the judge would give him something, as if that mollification would buy peace instead of inviting additional rounds of revisitations and defiance). He wasn’t a Lion or a Lamb.  He was a Weasel. The case was hard-fought, but we were sure we gave a bit better than we got, and our closing argument echoed Pericles (so we thought) while our villainous opponent cribbed his best lines from one of his competitor Texas plaintiff lawyers. His appeals to prejudice were utterly unoriginal. And plagiarism was the least of this scoundrel’s sins.  Be that as it may, it was now time to wait for the jury.  Our client, who was doubtless the smartest person in the room, took the plaintiff lawyer aside. They huddled and talked intently. One or two perplexing questions came from the jury.  Those questions were so unsettling as to provoke settlement. The in-house lawyer struck a deal with our adversary.  It seemed to us like a lot of money.   But there it was.

 

We informed the Judge. The Judge then informed the jury.  We then talked to the jury.  What they told us made none of us happy.  It seems that the jury was leaning toward awarding a verdict about ten times higher than the settlement. One member of the jury had been a bit, um, stealthy.  In voir dire she had disclaimed any relevant prior history at all.  It turned out that she had a daughter who suffered from a condition pretty similar to what the plaintiff claimed.  This juror pushed hard to become foreperson, and then pushed even harder for a punishing verdict.  We (the defense) were stunned.  But perhaps we weren’t quite as stunned as the plaintiff lawyer, who had bargained away his next vacation home.
We were almost Lambs.

 

There are lots of reasons why cases are won or lost, or settled.  We hate it when judges are outcome-oriented, and we should beware of that fault in ourselves, too.  The best lawyers don’t always get the best results.  We can think of a case where one of the finest, smartest, smoothest two or three trial lawyers we ever saw lost to one of the two or three dopiest, clumsiest ones we ever saw. The jury was moved by undeniable facts and unavoidable sympathy.
Let’s have a little sympathy for those Legal Lambs.  They might very well be much better than the Lions, and they probably did a better  job than most of us would have done.  Heck, they probably don’t want our sympathy.  They are much too tough for that.  They are not Lambs at all.

Back in 2010 we started titling some of our posts “There’ll Always Be Posner,” in mimicry of the “There’ll Always Be an England” squibs in The New Yorker.  Just as there is something uniquely charming, majestic and, occasionally, flat-out weird about news from the quirky island that formerly ruled over us, there is something uniquely charming, majestic, and, occasionally, flat-out weird in legal opinions authored by Seventh Circuit Judge Richard Posner.  Or, we should say, former judge, as he stepped down from the bench this past weekend.

When we arrived at the University of Chicago Law School 35 years ago this month, Posner had recently vacated his full-time professorship at U of C in favor of an Article III position.  Nevertheless, he continued to teach classes in Hyde Park.  His influence on campus remained ubiquitous. Some professors (e.g., William Landes and Frank Easterbrook) continued to develop Posner’s law and economics analysis.  Even professors who parted company with Posner’s bottom line positions, such as Richard Epstein and Cass Sunstein, recognized the force of Posner’s breakthroughs and incorporated them, or at least took them into account, in their own scholarship.

While Posner’s work in integrating law and economics is an enormous achievement, there is so much more to his contributions to legal studies.  To begin with, his sheer output has been staggering.  Posner has authored over 50 books and 500 articles.  The Journal of Legal Studies counted over 7981 cites of Posner and rated him the most cited legal scholar in the 20th Century.  Not all of Posner’s books and articles were about law and economics.  In fact, most were not.  Nor have his writings been predictable.  If you had told us back in 1982 that Posner would later author a book titled The Failure of Capitalism, we might have stumbled into the Law School fountain.

Judge Posner has written over 3300 opinions.  They, too, are capable of surprise.  He has changed his mind more than once.  His positions on controversial subjects such as voter identification requirements or gay marriage have somersaulted. At one time Posner was routinely lumped in as a judicial “conservative.”  That is not only simplistic, but largely wrong.  The same Posner who, along with Aaron Director, Robert Bork, Frank Easterbrook, and others insisted that antitrust law be tethered to economic reality and consumer welfare, also clerked for Justice William Brennan, worked under Solicitor General Thurgood Marshall, and jousted fiercely with Justice Scalia over whether originalism was a correct mode of constitutional interpretation or a fool’s errand.  When the judge for whom we clerked, Ninth Circuit Judge William Norris, retired, he said that he would “reclaim [his] First Amendment rights.” That is, Norris planned on speaking out on political issues in a way he felt he could not while he wore judicial robes.  Posner has apparently never felt so constrained.  He has written or spoken quite pointedly on political and economic issues over the last several years.  Type “Posner” onto Youtube, sit back, and enjoy.  He has picked fights. He has named names. Our cultural discourse has been much the better for it.

As you might expect, the best summary of Posner’s method comes from Posner himself.  In his retirement note, he emphasized his pride in taking a “pragmatic” approach to judging, in writing opinions that are easy to understand, and in focusing on issues of right and wrong in every case.  Economic reality is one part of that pragmatic approach, but there is more.  Posner paid at least as much attention to how parties act in the real world as to what judges had written regarding vaguely similar fact-scenarios in old, and sometimes not clearly thought-out, opinions. Posner’s opinions were always clearly thought out, and, just as important, they were clearly expressed. The clarity of Posner’s opinions is no accident.  We know some people who clerked for Posner, and they confirm that Posner wrote every word of his opinions himself.  While it must have been an enriching experience to have worked closely with the great man, we also get the sense that Posner’s clerks had fewer responsibilities, almost reduced to the point of merely fetching him books, than other clerks.  Based on Posner’s criticisms of what he perceived as judicial over-reliance on clerks, that is not surprising.

We think that, like Judge Learned Hand, Posner will go down in history as being much more influential, and much more insightful, than all but a few Supreme Court Justices. As with Hand, it is a pity that Posner never ascended to our highest court.  He was simply too smart, too intellectually adventurous, too prolific, and too damned clear.  [Isn’t there something supremely silly about the way we currently pick Supreme Court Justices?  Instead of being a capstone to a long and distinguished legal career, positions on the Supreme Court are too often conferred on people who have a limited paper record, and whose birthdate promises a long term and maximum impact.]  Then again, remember that Hand believed in judicial modesty, and cautioned against being ruled by judicial philosopher-kings.  Posner’s pragmatism and attention to what he believes are right and wrong outcomes arguably makes him one of those dreaded judicial philosopher-kings.

When we encountered criticisms of Posner over the years, they usually centered on his lack of respect for precedent and for lack of predictability.  Posner seemed to delight in disposing of cases on jurisdictional grounds that none of the lawyers or the lower court had even considered.  That can be frustrating for advocates. Worse, Posner could be cruel to lawyers who seemed insufficiently smart or conversant with relevant precedent — and most lawyers, in Posner’s eyes, probably fell into that category.  Posner himself once acknowledged his similarity to his beloved pet cat, listing cruelty as one of their common traits.  Remember how we said that Posner’s opinions could be flat-out weird?  When Posner thought that a lawyer had been willfully blind to controlling precedent, he appended to his opinion a picture of an ostrich with its head in the sand.

Yesterday, we mentioned to one of our most trusted and admired colleagues that we were going to say a few words about Posner’s retirement.  He then told us a story that is so magnificently on point that we simply have to share it with you.  Our friend and some other folks, all tremendously smart and diligent, devoted many days to preparing another lawyer for a Seventh Circuit oral argument.  Posner was on the panel, so the preparation went the extra mile. When the very well-prepared lawyer approached the lectern, he didn’t even finish clearing his throat before Posner’s reedy voice cut in: wasn’t the case at hand on all fours with the case of X v. Y? (The case had actual names, but they have been lost in the mists of time.)  The preppers looked at each other in utter dismay. They had never discussed this case at all.  They had never heard of it. What a failure!  What an embarrassment! The poor fellow at the microphone admitted, as gracefully as he could, that he was unfamiliar with the case.  Through a thin smile, Posner supplied the citation. The case was from the House of Lords, and was over a hundred years old.  Was this gratuitous one-upmanship?  Well, the case really was a perfect precedent, and it demonstrated why our friend’s side should win.  And so they did.  Posner, as always, was the smartest guy in the room, and made sure to prove it.  But a win’s a win, so ….

In our own field of tort law, Posner’s batting average was exceedingly high.  We have almost always been dazzled by his opinions, whether on issues of statutes of limitations, forum non conveniens, plaintiff lawyer fees, off-label prescriptions, our beloved preemption, class certification (though we griped a couple of times when we thought he had gone soft on that issue), class action settlementscy pres, and many, many other topics.  It was Posner who penned our single favorite line about Daubert: “Law lags science; it does not lead it.”  Rosen v. Ciba-Geigy Corp., 78 F.3d 316, 319 (7th Cir. 1996).  It was Posner who best understood how post-Levine “clear evidence” preemption could eliminate failure to warn claims. Robinson v. McNeil Consumer Healthcare, 615 F.3d 861 (7th Cir. 2010). It was Posner who wrote eloquently about the danger of aggregated litigation prompting blackmail settlements. In re Rhone-Poulenc Rorer, Inc., 51 F.3d 1293, 1298-1300 (7th Cir. 1995).  It was Posner’s discussion of negligence versus strict liability in Indiana Harbor Belt R.R. Co. v. American Cyanamid Co., 916 F.2d 1174 (7th Cir. 1990), that has become one of those judicial chestnuts that turns up in virtually every casebook.  Posner usually got it right, and in getting that rightness, his writing was compelling, crystalline, and often entertaining.  Posner could even enliven discussion of standard of review, as when he wrote in the Nightingale Home Healthcare case that “it is an abuse of discretion not to exercise discretion.”

At this point, it might be customary to bid a respectful adieu to Richard Posner, wistfully acknowledging how much we’ll miss reading his opinions.  But Posner’s retirement announcement makes clear that we’ll keep hearing from him.  In the marketplace of ideas, Posner will continue to be one of our most active and valued participants.  For that, we are profoundly grateful.

As our guest post predicted in last Monday, even Hurricane Harvey could not delay the Fifth Circuit long in deciding the Pinnacle Hip MDL mandamus petition.  Its decision, denying mandamus but mostly agreeing with the defendant’s substantive position, is available hereIn re Depuy Orthopaedics, Inc., ___ F.3d ___, 2017 WL 3768923 (5th Cir. Aug. 31, 2017).  The appellate court had two issues before it:  (1) whether defendants had waived jurisdictional objections under Lexecon Inc. v. Milberg Weiss Bershad Hynes & Lerach, 523 U.S. 26 (1998), as to all 9,300 MDL cases, as the MDL judge had held, and (2) whether, if there was no waiver, mandamus would lie “to prohibit the district court from proceeding to trial” in certain bellwether cases.  Depuy, 2017 WL 3768923, at *2.

The defendant won the waiver issue.  Although mandamus was ultimately denied as to the second (bellwether trial) issue, the panel majority (different majorities decided the two issues) issued a strong shot across the MDL judge’s bow by declaring that action to be in error.

To understand our evaluation, we begin with mandamus.

Mandamus is – and is intended to be – difficult to obtain, because it upsets and short-circuits the usual process of appellate review.  2017 WL 3768923, at *3.  To obtain mandamus, a petitioner such as the MDL defendant here, must establish three things:

  • The “right to relief” – that the judicial order at issue was erroneous – must be “clear and indisputable.”  There must be a “clear” abuse of discretion that “produce[s] patently erroneous results.”
  • Mandamus must be “appropriate under the circumstances,” being “particularly appropriate” for issues extending “beyond the immediate case.”
  • The mandamus petitioner must “have no other adequate means to obtain relief.”  If ordinary appellate review will suffice, mandamus is denied.

Depuy, 2017 WL 3768923, at *4-5.

As to waiver, the majority held that no valid basis existed for the MDL court’s decision that Lexecon/personal jurisdiction objections had been waived as to all 9,300 MDL cases.  Such waivers must be “clear and unambiguous,” id. at *4, and nothing the defendant did approached that standard.

The MDL court’s notion, echoed by plaintiffs, that petitioners are trying to limit their waivers retroactively, is not borne out by the facts.  We hold that petitioners limited their venue waivers to the first two bellwether trials and that the MDL court erred by declaring that they had globally and permanently waived their objections to venue and personal jurisdiction.  That was grave error:

Id. (footnotes omitted).  Since there was no “clear and unequivocal” waiver, “the MDL court clearly abused any discretion it might have had and, in doing so, reached a ‘patently erroneous’ result.”  Id. at *5.  Since this error at least potentially infected all 9,300 cases in the MDL, that prerequisite to mandamus was also met.  Id

Although two of the three judges on the Fifth Circuit panel found “grave error” in the grounds on which the pending (and, indeed, the past) consolidated bellwether trial was predicated, and also that mandamus would be “appropriate,” mandamus was nonetheless denied.  What happened?

One of those two panelists (Judge Jerry Smith, who wrote the opinion) switched on the third element – whether an appeal, after the 10-plaintiff consolidated trial was concluded, was an “adequate” remedy.  While the MDL statute, itself, is intended to “promote the just and efficient conduct of such [MDL] actions,” 28 U.S.C. §1407(a), that is not the mandamus standard.  As far as a right to mandamus is concerned, a doomed consolidated trial, no matter how wasteful of the parties’ time and resources, is still a trial, and at the end of the whole thing (“each of the previous three bellwether trials lasted several weeks,” 2017 WL 3768923, at *5), an appeal in the normal course can be had.  Mandamus, according to this majority, isn’t available to avoid waste of time and expense:

[F]or appeal to be an inadequate remedy, there must be some obstacle to relief beyond litigation costs that renders obtaining relief not just expensive but effectively unobtainable.  Nor is . . . the risk of substantial settlement pressure [] grounds for granting a mandamus petition;

Depuy, 2017 WL 3768923, at *6 (footnotes omitted).  Thus, the defendant “met [only] two of the three” elements required for mandamus.

On this final point, Judge Edith Jones dissented, finding that, apart from time and expense, the MDL court had “plainly act[ed] in excess of its jurisdiction, [so] mandamus may issue to prevent the usurpation of power.”  Id. at *9.  The grounds for her conclusion are interesting, and have implications for future MDL practice.  She believes that “direct filed” MDL cases by plaintiffs from outside the state in which the MDL is located (including all ten of the plaintiffs in the proposed bellwether trial) lack personal jurisdiction, and therefore “but for” the “global waiver” that the panel had just found erroneous, there was “no claim to personal jurisdiction over the cases.”  Id.  Because there was no jurisdiction (and therefore, also improper venue) over the cases proposed to be tried, more than just wasted time and expense was involved, and mandamus was appropriate.  Id.

We’ve alluded to this potential jurisdictional problem with direct filed cases before, and we suspect there will soon be a lot more law on this issue.  We also believe that, in light of this jurisdictional uncertainty, and the direction in which Supreme Court’s recent jurisdictional precedents point, MDL defendants should strongly consider preserving objections to the use of direct filing.

So what now?  We doubt we have ever seen such a strong shot across the bow fired by an appellate court.  A majority of the panel – and law of the case usually applies to appellate decisions – says that the basis for the objected-to consolidated bellwether trial (and also the one just finished) was not just error but “clear” and “grave” error.  This “majority requests the district court to vacate its ruling on waiver and to withdraw its order for a trial.”   2017 WL 3768923, at *1.  Judge Jones’ dissent describes the likely result if the MDL judge disregards this signal and plows forward anyway:

If the district court lacked jurisdiction over these direct-filing plaintiffs’ cases, as our panel majority concludes, they will receive a take-nothing judgment nearly a decade after their suits were filed and will have to start all over − if they have the stomach for it.  For the remaining thousands, the goal of the bellwether process will have been perverted by unreliable judgments, delayed by the appeals, and undermined when those judgments are reversed.  Allowing the court’s conduct of trials outside its jurisdiction to spawn such unpredictability and unfairness will harm petitioners or plaintiffs and most likely both.  Such an outcome belies the goals of efficiency, economy, fairness, and predictability for which the MDL system supposedly exists.

Depuy, 2017 WL 3768923, at *10 (concurring and dissenting opinion) (citing §1407).

One possibility is for the defendant to seek en banc appellate review, since both parts of the decision – the finding of clear error, and the denial of mandamus drew dissents from different members of the panel.  That has happened before in the MDL context, although a long time ago.  See In re Exterior Siding & Aluminum Coil Antitrust Litigation, 705 F.2d 980 (8th Cir. 1983) (en banc) (vacating mandamus concerning class certification).  However, the strictures of the difficult-to-meet mandamus standard must be considered.  Plaintiffs might also seek such review, although since relief was denied, it is questionable whether they would be “aggrieved” enough to have standing.

Another possibility would be to seek relief from the Panel on MDL Litigation, since there are strong grounds (enunciated by Judge Jones) for asserting that the Pinnacle Hip MDL is no longer being conducted in accordance with the goals and purposes of the MDL statute.  Finally, it is possible, that with an appellate finding of error staring him in the face, the MDL judge, on remand, may decide that a course correction is in order.

Whatever happens, we’ll be watching with interest.

Risperdal, an antipsychotic drug prescribed to treat serious mental conditions – schizophrenia, manic depression, and autism – allegedly causes some male users to develop abnormal breast tissue growth. Particularly when compared to the consequences of the conditions Risperdal is indicated to treat, that seems like a relatively minor risk.  It isn’t fatal.  It isn’t a long-term disability.  It doesn’t prevent one from making a living.  Thus, Risperdal litigation is a prime example of low-value cases that only exist because of the mass-tort system that has saddled the country for so long.

Thus, it is hardly surprising that Risperdal cases are on the front lines of the battle to rein in our long national mass-tort nightmare.

Just last week we learned of these two decisions:

(1) Covington v. Janssen Pharmaceuticals, Inc., 2017 WL 3433611 (E.D. Mo. Aug. 10, 2017).  Covington was one of the ridiculously misjoined multi-plaintiff complaints that mashed together residents from all over the country.  Before Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017) (“BMS”), Missouri federal courts routinely remanded these atrocities to the St. Louis litigation cesspool because there was always at least one diversity-destroying non-Missouri plaintiff, as well as one jurisdiction establishing Missouri plaintiff in the bunch.  Covington, 2017 WL 3433611, at *2 (“Historically − and especially in this district − courts generally have addressed subject matter jurisdiction first”).

Not anymore.

Covington is typical of the multi-plaintiff complaint genre – 54 plaintiffs from 26 different states.  2017 WL 3433611, at *1.  “Only one plaintiff” alleged injury from use of the drug “in the state of Missouri.  Id.  As for the rest:

The Non-Missouri plaintiffs, or those who do not have any connection to the state of Missouri, do not allege that they were prescribed Risperdal or any of its variants in Missouri, ingested the same in Missouri, or were injured in Missouri.

Id.

With BMS, the personal jurisdiction issues involving litigation tourism of this sort were largely resolved.  With no fixed “jurisdiction hierarchy,” it was now logical to take up this “more straightforward issue first. ” Id. at *2.

However, these [contrary] cases were decided before [BMS] and State ex rel. Norfolk S. Ry. Co. v. Dolan, 512 S.W.3d 41 (Mo. 2017) (en banc) [our post on Dolan is here].  These decisions make the personal jurisdiction issue in this case much easier to decide. . . .  Further, analyzing the challenge to personal jurisdiction first avoids any issues relating to fraudulent joinder.  Personal jurisdiction is now the more straightforward inquiry and should be addressed first as it is in the interests of judicial economy and expeditiousness.

Id. (citations and quotation marks omitted).

The personal jurisdiction question was easy.  There could be no general jurisdiction.  “[N]o defendant is incorporated in Missouri nor has its principal place of business in Missouri.”  Id. at *4.  ‘Nuff said.  Nor was there specific personal jurisdiction for all but one of the plaintiffs – thus removing the planted plaintiffs from the defendants’ home states.

[B]esides the Missouri plaintiff, no other plaintiff allege that they, or a child or incapacitated person whom they represent as next friend, were prescribed or purchased Risperdal in this state, suffered an injury from Risperdal in this state, or received treatment for an injury from Risperdal in this state.

Id.  The “mere fact that other plaintiffs were prescribed, obtained, and ingested [the drug in Missouri] − and allegedly sustained the same injuries as did the nonresidents − does not allow the State to assert specific jurisdiction over the nonresidents’ claims.”  Id. at *4 (quoting BMS).  Thus 53 of the 54 plaintiffs were dismissed (without prejudice, and with the laws of their home states determining whether an unsuccessful litigation tourism jaunt tolled their statutes of limitations).  A single plaintiff’s low-value case thus remained in Missouri federal court.  Id. at *5.  It probably won’t last long, since the March 8, 2017 filing date was more than a dozen years after 2004, when that plaintiff admits discovering the supposed injury.  Id. at *6.

Plaintiffs mounted unsuccessful rearguard actions in Covington.  They sought a stay – claiming “prejudice” from the need to sort out a supposed jurisdictional morass that they, themselves, created.  That went nowhere.  Id. at *3 (“A motion to stay should not be abused by a party to dictate which motion is first addressed by the Court.”).  They also sought “jurisdictional discovery” – a fishing expedition to search for Risperdal/Missouri contacts.  Covington likewise saw that request for what it was:

Here, the plaintiffs do not plead any specific facts that support their contention that this Court has personal jurisdiction over all of the plaintiffs’ claims. Alleging that facts might be discovered during a jurisdictional discovery expedition will not allow plaintiffs to survive a 12(b)(2) motion to dismiss.

Id. at *5.

Summing up, Covington observed:

Unfortunately for the plaintiffs, [BMS], under the facts of this case, made personal jurisdiction the more straightforward issue and therefore more proper to be analyzed first.  Further, [BMS] held that forums, like Missouri in this action, do not have specific personal jurisdiction over non-resident corporations when the plaintiffs do not allege any specific connection between the forum and the specific claims at issue.

Neither this Court nor the state court in which this action was removed can exercise personal jurisdiction − whether general or specific − over the defendants for the claims brought by the 53 non-Missouri plaintiffs.

Id. at *6.

That’s one.

(2) West v. Janssen Pharmaceuticals, Inc., 2017 U.S. Dist. Lexis 124276 (Mag. M.D. Ala. Aug. 4, 2017).  West is something of the obverse of Covington.  In Covington the plaintiffs joined together in an attempt to manufacture jurisdiction for a horde of weak cases, whereas in West, jurisdiction already existed, so the plaintiffs were trying to join their weak cases together to prejudice the defendant at trial.  Once again, the court wasn’t buying the consolidation.  West involved two plaintiffs, Harper and West, treated at one point by the same prescribing physician, both alleging the same injury from the same drug.  Id. at *2, 11.

But that was as far as the similarities went.

The two plaintiffs were of much different ages; one a minor, the other not. One involved off-label use; the other not.  One involved innovator liability (being filed during the few Weeks window when that theory was allowed in Alabama); the other not.  There were various other differences as well, such as duration of use, and when the drug was prescribed (affecting the relevant warnings), and the age at which the risk allegedly manifested.  Id. at *13-15.

The dissimilarities in the Plaintiffs’ claims have be-come more apparent as discovery and expert testimony have developed.  Harper began taking Risperdal as a five or six-year old and was always a minor while taking the medication.  In contrast, West did not begin taking the medication until he was almost eighteen years old and was physiologically an adult.  The significance of this difference is highlighted by the expert causation testimony. . . .  Further, the consequence of Risperdal not being approved for pediatric use takes on a much different meaning in the two cases.

Id. at *12-13.

These differences precluded a joint trial under Fed. R. Civ. P. 20.  “The critical differences between the claims asserted by Plaintiffs outweigh the similarities between the cases, and the court finds trying the cases together would thus be inefficient and confusing for both the Court and the jury.”  Id. at *14.  The presence of an innovator liability claim in one of the cases demonstrated their legal as well as factual disparity.  Id. at *15-16.  Further, “West and Harper were prescribed multiple prescriptions, written at different times by different physicians and in different doses at different physiological stages of their lives.”  Id. at *16.

Thus, two disparate plaintiffs could not claim injury “from the same series of transactions” as required by Rule 20. Id. at *17.  No consolidation synergies for these two weak cases.

*          *          *          *

Two Risperdal cases; two different jurisdictions; two attempts by plaintiffs to manipulate joinder to the disadvantage of defendants defeated.  We look forward to similar rulings in the future.

 

 

We’re on vacation. The dog days of Summer are upon us. Time for our annual (okay – monthly) (okay- weekly) substance-less post. Our vacation began just a couple of days ago, yet we already rue its passing. Good times go by in the blink of an eye. We want to get away from the keyboard and back to the beach, so today we aim to keep this blogpost short. And that’s the point: short is good.

Short and sweet. Short and memorable. The Drug and Device Law Son, who recently earned a degree in marketing, reminds us that the best ad slogans are short. Just do it. Think. Coke is it. Think different. The same is true with art. It’s easier to watch half-hour sitcoms than hour-long dramas. We miss the early Woody Allen movies, which seldom lingered beyond 90 minutes. (We are not completely discounting the possibility that our recent obsession with short-form has something to do with bathroom breaks.). Our high school junior year English teacher told us that the two greatest American novels were Moby Dick and The Great Gatsby. We’ve read Gatsby seven or eight times. Moby Dick? Once. Shorter is more user-friendly.

In the law, too, short is good. The best bits of legal instruction ever done were the late Irving Younger’s lectures on cross-examination and evidence. You can find those lectures on YouTube. Younger announces the first rule of cross-examination by looking down to the ground, gathering his forces, then roaring, “Be brief!” Make no more than three points in your cross. Two is better. One is best of all. More than that, and you’re just flopping around. The jury will be bored and/or confused. Then they will punish you.

Think of the closing arguments you’ve seen in television shows (LA Law, Boston Legal, Goliath) or movies (To Kill a Mockingbird, The Verdict, The Client). They last under five minutes and are utterly compelling. Why don’t we see those short, snappy oral arguments in real life? We’re afraid of not making all the points we need, and not responding to all our opponent’s points. Whenever we walk out of an oral argument, what obsesses us are the arguments we did not make. But maybe we’ve got it all wrong. Maybe Irving Younger’s recommendation of brevity applies to oral arguments just as much as to cross-examinations. (It is amazing that this insight arrives as any sort of surprise to us. When we represented the United States of America in criminal cases, our best oral arguments went something like this: “No doubt your Honor has read the briefs. (Wait for a judicial nod.). Unless your Honor has any questions, the government submits on the papers.”).

Shortly before we embarked on our vacation, we attended an oral argument before the Joint Panel on Multidistrict Litigation, If you haven’t been to one of these arguments, you need to know they are unlike any other. The cases are huge but the arguments aren’t. The Panel typically affords a total of 20 minutes for argument. That’s 10 minutes per side – at most. In our case, there were multiple parties on each side, taking a variety of positions as to whether there should be an MDL at all, or who should be included, or where it should be located. Most parties were allocated one or two minutes to argue. One party, which apparently was taking the position that most interested the Panel, got a whopping four minutes.

Here’s the revelation: it worked. The arguments were all really good. One could assume the Panel had read the briefs carefully. The questioning by the judges proved as much. So the goal of argument was to update if need be, emphasize one or two crucial points, and, most important of all, answer the judges’ questions. Each and every lawyer was able to do that quite well. One plaintiff lawyer even used blow-up boards and effectively melded them into a two-minute argument. Sometimes the judges asked questions that took the speaker beyond the allocated time, but never by much. When it was over, no one felt cheated. It was a rebuke to the long-winded ness that too often prevails in our profession.

Right now we have a case set for trial in front of a judge who imposes mightily compressed time limits. The lawyers all chafe under the trial chess-clock, but there is reason to believe that the more concise the witness examinations are, the more they make an impact with the jury. The judge is probably correct that lawyers ramble on, perfectly oblivious to the law of diminishing returns. Still, we will probably grind our teeth and steam over the poor jury’s misfortune in being denied an extra hour or two of our eloquence.

There’s another part of our job that could benefit from brevity: writing. Briefs are ironically named. Lately we’ve been making a point of trying to get our briefs in under ten pages, even if the rules permit 20 or 25. We harbor a suspicion that anything longer taxes judicial patience, and perhaps even convinces the court that if we cannot make the point crisply and clearly, we don’t have much of a point. Accordingly, we put a lot of sweat equity in writing a one or two paragraph introduction that should, by itself, win the day for us. Then we will sprinkle the brief with headings and subheadings that make the merits of our position seem ineluctable. The supporting facts and law parked underneath those headings and subheadings should be just enough and no more. Anything that isn’t screamingly essential gets dropped to footnotes in the second draft. In the final draft, we will probably then delete almost all the footnotes. The life-cycle of marginal arguments and evidence is short and cruel.

The key is to know when to stop.

We read Michelle Yeary’s recent post about In re Fosamax Products Liability Litigation, ___ F.3d ___, 2017 WL 1075047 (3d Cir. March 22, 2017), with particular interest.  We were especially intrigued with the research demonstrating that the Fosamax court had departed from numerous prior Third Circuit precedents (including an en banc decision) on the question of preemption being a matter of law – as all the prior decisions had held – as opposed to a question of fact (the Fosamax result).

We note that the defendant in Fosamax shares the same view, and has itself sought en banc reconsideration.

Since Michelle cited over a dozen prior decisions, it’s highly likely that this issue will arise again. That raises the question (if the Fosamax opinion stands, which it shouldn’t) , what happens when precedential decisions of the Third Circuit are in conflict?  There certainly appears to be a direct conflict between the cases Michelle cited and the Fosamax decision.

We took a look.

In the Third Circuit, when two precedential opinions are in conflict, the earlier one – that is to say, in this instance, not Fosamax – controls.  This proposition was described in Pardini v. Allegheny Intermediate Unit, 524 F.3d 419 (3d Cir. 2008).  After referencing the same Third Circuit Internal Operating Procedure that Michelle did, Pardini held:

“This Circuit has long held that if its cases conflict, the earlier is the controlling authority and the latter is ineffective as precedents.”  United States v. Rivera, 365 F.3d 213, 213 (3d Cir. 2004); see also Holland v. New Jersey Dep’t of Corrections, 246 F.3d 267, 278 (3d Cir. 2001) (“[T]o the extent that [a case within the circuit] is read to be inconsistent with earlier case law, the earlier case law . . . controls”); O. Hommel Co. v. Ferro Corp., 659 F.2d 340, 354 (3d Cir. 1981) (“[A] panel of this court cannot overrule a prior panel precedent.  To the extent that [the later case] is inconsistent with [the earlier case, the later case] must be deemed without effect.”).

Id. at 426 (parenthetical and internal citations omitted).  As Pardini pointed out, this rule is the opposite of what happens when two statutes are irreconcilable.  Id.  But instead of the doctrine of implied repeal, the Third Circuit gives effect to its IOPs in a situation of precedential conflict – since the IOPs forbid what Fosamax sought to do, which was to ignore prior holdings of precedential Third Circuit opinions.

Pardini was followed in United States v. Joseph, 730 F.3d 336 (3d Cir. 2013), where later “statements suggesting otherwise” in Third Circuit opinions about waiver were ineffective to defeat prior precedent:

This suggestion, however, is in conflict with our earlier decisions . . . which we derive our holding [today].  Because these cases were decided earlier, the rule derived from them is controlling.

Id. at 341. Accord Goldman v. Citigroup Global Markets Inc., 834 F.3d 242, 252 (3d Cir. 2016) (a decision that “is contrary to our own prior precedent” “does not bind us on the question”); United States v. Tann, 577 F.3d 533, 541 (3d Cir. 2009) (“when our panel decisions conflict and our Court has not spoken en banc, however, the earlier decision is generally the controlling authority”); Kossler v. Crisanti, 564 F.3d 181, 194 n.8 (3d Cir. 2009) (“Even assuming arguendo that [the two opinions] are in unavoidable conflict, this Circuit has long held that if its cases conflict, the earlier is the controlling authority and the latter is ineffective as precedents”).

Indeed, we remember precisely this happening in connection with a Pennsylvania product liability issue a number of years ago. In Griggs v. BIC Corp., 981 F.2d 1429, 1433 n.6 (3d Cir. 1992), the court held that Pennsylvania did not use a “risk/utility” approach to the former (this law was all overruled in Tincher v. Omega-Flex, Inc., 104 A.3d 328 (Pa. 2014)) “threshold determination” of defect.  However, in Motter v. Everest & Jennings, Inc., 883 F.2d 1223 (3d Cir. 1989) – a case Griggs did not cite – a prior Third Circuit panel had held, “[u]nder Pennsylvania law, a trial judge must evaluate the risks of a product versus its social utility in determining whether the issue of the defective product is to be submitted to the jury.” Id. at 1227.  When confronted with both Griggs and Motter, a later Third Circuit panel resolved the conflict thusly:

to the extent that the panel’s decision [in Griggs] can be read as rejecting outright the use of a risk-utility analysis as a part of the threshold determination, it is contrary to our decision in Motter, supra, which . . . sanctioned this approach, and, therefore, carries no precedential weight.  See O. Hommel Co. v. Ferro, 659 F.2d 340, 354 (3d Cir. 1981) (“[A] panel of this court cannot overrule a prior panel precedent…. To the extent that [the later case] is inconsistent with [the earlier case, the later case] must be deemed without effect.”

Surace v. Caterpillar, Inc., 111 F.3d 1039, 1046 (3d Cir. 1997).

Thus, unless and until the determination in Fosamax that preemption is an issue of fact is confirmed by an en banc Third Circuit panel, or by an intervening decision of the United States Supreme Court, that determination should have no binding effect in future Third Circuit cases.  Third Circuit law is quite clear that where, as in Fosamax, a panel has made a ruling in conflict with prior Third Circuit decisions, the earlier decisions control.

But, as we’ve said before, strange things happen in tort preemption cases. We would have thought that the proposition that preemption was a legal question was supported equally clear precedent, but look at what happened in Fosamax.

The Louisiana Product Liability Act (“LPLA”) was enacted way back in 1988 – almost 30 years ago – to rein in the Louisiana courts’ product liability insanity (inanity?) epitomized by Halphen v. Johns-Manville Sales Corp., 484 So.2d 110 (La. 1986), which had allowed strict liability without defect under something called “unreasonably dangerous per se.”  “One of the legislature’s primary purposes in enacting the LPLA was to overrule Halphen.” Brown v. R.J. Reynolds Tobacco Co., 52 F.3d 524, 526 (5th Cir. 1995).  To accomplish this objective, the LPLA explicitly “establishes the exclusive theories of liability for manufacturers for damage caused by their products,” and under that statute a plaintiff “may not recover from a manufacturer for damage caused by a product on the basis of any theory of liability that is not set forth in [the LPLA].”  La. R.S. §9:2800.52.

Appellate courts applying Louisiana law have held that the legislature meant what it said. “The plaintiff’s case arises under the LPLA, which provides the exclusive theories under which a plaintiff can pursue a claim against a manufacturer for an alleged product defect.” Reynolds v. Bordelon, 172 So. 3d 607, 612 (La. 2015).  “[T]he LPLA is the exclusive remedy against manufacturers for damages resulting from a defective product.”  Aucoin v. Southern Quality Homes, LLC, 984 So. 2d 685, 691 n.8 (La. 2008) (noting exception for the peculiar doctrine of redhibition; see our post about redhibition here).  A “plaintiff’s exclusive remedy against [a manufacturer] sounds in products liability as governed by the Louisiana Products Liability Act.”  Payne v. Gardner, 56 So. 3d 229, 231 (La 2011). Accord Johnson v. Teva Pharmaceuticals USA, Inc., 758 F.3d 605, 616 (5th Cir. 2014) (“the LPLA provides [plaintiff’s] exclusive remedy”); Demahy v. Schwarz Pharma, Inc., 702 F.3d 177, 182 (5th Cir. 2012) (LPLA “provides that it is the exclusive remedy for products liability suits”); Jefferson v. Lead Industries Ass’n, Inc., 106 F.3d 1245, 1248 (5th Cir. 1997) (“Louisiana law eschews all theories of recovery in this case except those explicitly set forth in the LPLA”); Haley v. Wellington Specialty Insurance Co., 4 So. 3d 307, 311 (La. App. 2009) (“[t]he LPLA establishes the exclusive theories of liability for manufacturers for damages caused by their products”); Jenkins v. International Paper Co., 945 So. 2d 144, 147 (La. App. 2006) (“[t]he exclusive theories of liability for manufacturers for damages caused by their products are set forth in the . . . LPLA”); Slaid v. Evergreen Indemnity, Ltd., 745 So. 2d 793, 797 (La. App. 1999) (LPLA “establishes the exclusive theories of liability for manufacturers for damages caused by their products”); Ashley v. General Motors Corp., 666 So. 2d 1320, 1321-22 (La. App. 1996) (“[a] claimant may not recover from a manufacturer for damages caused by a product on the basis of any theory of recovery not set forth in the Act”).

Thus, “neither negligence, strict liability, nor breach of express warranty is any longer viable as an independent theory of recovery against a manufacturer.”  Jefferson, 106 F.3d at 1251.  “[A]llegations of negligence, fraud by misrepresentation, market share liability, breach of implied warranty of fitness and civil conspiracy fail to state a claim . . . under the LPLA.”  Id. at 1252.  Similarly, “both federal and Louisiana courts have read the Act’s exclusive remedy provision to prevent plaintiffs from bringing intentional tort claims.” Stahl v. Novartis Pharmaceuticals Corp., 283 F.3d 254, 262 (5th Cir. 2002) (citations omitted).

The LPLA applies to all Louisiana product liability cases that accrue after the act’s effective date of September 1, 1988.  Gilboy v. American Tobacco Co., 582 So.2d 1263, 1264 (La. 1991); Brown, 52 F.3d at 530.  Like we mentioned above, that’s almost thirty years ago.

Yet, time after time, we see Louisiana plaintiffs filing – and courts dismissing – complaints chock full of non-LPLA common-law “causes of action” which since 1988 have had no possible legal validity.  E.g., Donald v. AstraZeneca Pharmaceuticals LP, 2017 WL 1079186, at *1-2 (E.D. La. March 22, 2017); Pramann v. Janssen Pharmaceuticals, 2017 WL 58469, at *2 (E.D. La. Jan. 5, 2017); Guidry v. Janssen Pharmaceuticals, Inc., 2016 WL 633673, at *3 (E.D. La. Feb. 17, 2016); Lyles v. Medtronic, Inc., 2016 WL 247584, at *3-4 (W.D. La. Jan. 20, 2016); Toups v. Synthes, Inc., 2015 WL 6738541, at *4-5 (E.D. La. Nov. 4, 2015); Hargrove v. Boston Scientific Corp., 2014 WL 4794763, at *14 (E.D. La. Sept. 24, 2014); Audrict v. Depuy Orthopaedics, Inc., 2014 WL 906562, at *1-2 (E.D. La. March 7, 2014); Corley v. Stryker Corp., 2014 WL 783066, at *1-2 (W.D. La. Feb. 25, 2014); Scianneaux v. St. Jude Medical, S.C., 961 F. Supp.2d 808, 811 (E.D. La. 2013); Gavin v. Medtronic, Inc., 2013 WL 3791612, at *15-16 (E.D. La. July 19, 2013); Aucoin v. Amneal Pharmaceuticals, LLC, 2012 WL 2990697, at *5 (E.D. La. July 20, 2012); Cooper v. Wyeth, Inc., 2010 WL 2653321, at *2 (M.D. La. June 25, 2010); Lewis v. Pfizer Pharmaceutical Co., 2010 WL 2545195, at *2 (W.D. La. June 18, 2010).  These are just the prescription medical product cases since 2010 – we have to believe that many more similar Louisiana cases exist involving other products.

Through ignorance, sloth, or just plain cussedness, plaintiffs’ lawyers in Louisiana have persisted for decades in bringing claims that have no pretense of viability under controlling state law represented by the LPLA. Isn’t it time for Rule 11?

Federal Rule of Civil Procedure 11 provides, in pertinent part, that sanctions are available when:

the claims . . . are warranted by existing law or by a nonfrivolous argument for extending, modifying, or reversing existing law or for establishing new law.

Fed. R. Civ. P. 11(b)(2).  “[M]onetary sanctions can be imposed against the attorney but not the client for violations of Rule 11(b)(2).”  Skidmore Energy, Inc. v. KPMG, 455 F.3d 564, 568 n.8 (5th Cir. 2006) (citation and quotation marks omitted).  The “obligation [under Rule 11(b)(2)] must be satisfied; [its] violation . . . justifies sanctions.”  Whitehead v. Food Max of Mississippi, Inc., 332 F.3d 796, 802 (5th Cir. 2003) (en banc).  “[I]n determining compliance . . ., the standard under which an attorney is measured is an objective, not subjective, standard of reasonableness under the circumstances.”  Id. (citation and quotation marks omitted).  “[P]laintiffs violate[] Rule 11(b)(2)” when they “fil[e] complaints replete with obviously deficient claims.”  Marceaux v. Lafayette City-Parrish Consolidated Gov’t, 614 F. Appx. 705, 709 (5th Cir. 2015).

With respect to the LPLA’s statutory extinguishment of common-law causes of action, as developed above, the law is crystal clear and uniform appellate authority that common-law claims of whatever type (except redhibition) are barred stretches back decades. The statute is plain on its face, thus the “legal issues are not that complex.”  Marceaux v. Lafayette City-Parrish Consolidated Gov’t, 14 F. Supp. 3d 760, 771 (W.D. La. 2014), aff’d, 614 F. Appx. 705 (5th Cir. 2015).

To us it seems like the other side’s persistence in filing facially LPLA-barred common-law causes of action in Louisiana product liability cases is an open and shut case for Rule 11 sanctions.  Defense counsel would, of course, have to comply with the pre-filing and safe harbor provisions of Rule 11(c), so plaintiffs could withdraw those claims within 21 days, and the defendant would recover nothing.  However, using the case-law cited in this post, preparing an almost boiler-plate motion based on LPLA exclusivity (needing only party names, paragraph numbers, and the pertinent common-law claims to be filled in individually) should not be very costly – and once drafted, the motion could be used repeatedly to force dismissal of the barred claims, thus saving the expense of individualized motions to dismiss.

We DDL bloggers are happy to offer the Louisiana defense bar these tools to put an end to plaintiffs’ routine violation of the LPLA.