We’ve blogged several times about the Biomaterials Access Assurance Act of 1998, 21 U.S.C. §§1601-06.  In a nutshell, the BAAA provides suppliers of “raw materials and component parts” used in the manufacture of medical devices with a “Get Out of Litigation Free” card in most situations.  It allows manufacturers of “biomaterials” – defined as “a manufactured piece of an implant” or a “substance” that “has a generic use” and “may be used in an application other than an implant” – to remove themselves from product liability litigation before being forced to engage in expensive and time consuming discovery.  See 21 U.S.C. §1602(3, 8) (defining “raw material” and “component part”).

However, the BAAA is now twenty years old, and in light of the rapid technological advancement in the medical device field, could use some updating for the twenty-first century.

What Congress was trying to ensure in enacting the BAAA was that manufacturers of “raw materials and component parts [that] also are used in a variety of nonmedical products” remain willing to supply manufacturers of medical devices by removing the threat of litigation over the small quantity of those materials used by medical device manufacturers to make FDA-regulated products:

(5) because small quantities of the raw materials and component parts are used for medical devices, sales of raw materials and component parts for medical devices constitute an extremely small portion of the overall market for the raw materials and component parts;

(6) under the [FDCA] manufacturers of medical devices are required to demonstrate that the medical devices are safe and effective, including demonstrating that the products are properly designed and have adequate warnings or instructions;

(7) notwithstanding the fact that raw materials and component parts suppliers do not design, produce, or test a final medical device, the suppliers have been the subject of actions alleging inadequate–

(A) design and testing of medical devices manufactured with materials or parts supplied by the suppliers; or

(B) warnings related to the use of such medical devices;

(8) even though suppliers of raw materials and component parts have very rarely been held liable in such actions, such suppliers have ceased supplying certain raw materials and component parts for use in medical devices for a number of reasons, including concerns about the costs of such litigation;

(9) unless alternate sources of supply can be found, the unavailability of raw materials and component parts for medical devices will lead to unavailability of lifesaving and life-enhancing medical devices. . . .

Id. §§1601(5-8).

Back in 1998, few if any medical devices utilized computer software, and cloud computing did not exist.  Further, to the extent that software was used in medical devices twenty years ago, it was not “agnostic,” but rather invariably custom made for the particular device – in stark contrast with the widespread use of interoperable imaging and 3D printing technology (to name two) in current medical devices.  Not surprisingly, the protection of the 1998 BAAA was limited to physical materials.  “Component parts” are “manufactured piece[s].”  Id. §1602(3)(a).  A “raw material” is “a substance or product.”  Id. §1602(8).

Thus, our proposal here is simple.  In order for the BAAA to provide the scope of protection for suppliers of database agnostic software and platform agnostic storage capacity (and other types of interoperable computer code that we mere bloggers don’t even comprehend – blockchain, anyone?) as Congress intended, the BAAA needs to be amended to include manufacturers of a third category of medical device-related inputs, “electronic applications” (or something like that), within its protections.  To that end we propose the following amendment, in the nature of an addition, to §1602.  First, to add a new definition:

(3A) Electronic applications

The term “electronic applications” means electronic software, data storage and other interoperable processing of electronic data used in connection with a medical device that has significant non-device-related uses.

Next, we advocate inclusion of “electronic applications” in the definition of “biomaterials supplier” provided in §1602(1).

These additions may require some tweaks elsewhere in the BAAA, but the gist of our proposal should be clear.  In the twenty-first century, the ability of a medical device manufacturer to incorporate multi-use “agnostic” electronic programming into its devices will be at least as important as access to specialized plastics and alloys was in the twentieth century. To ensure that vendors of such data processing software, cloud storage, and other interoperable electronic coding will continue to deal with medical device manufacturers without fear of (or prohibitive price premiums for) involvement in protracted, multi-district mass tort litigation, the BAA needs to be amended to include electronic software as twenty-first century biomaterials.

The federal right-to-try (“RTT”) adventure, which we chronicled here, and here, concluded not long ago with the final passage of S. 204, signed into law on May 30.  The final bill is not materially different from the house draft we analyzed earlier.  The final bill cleaned up some of the previous hastily-drafted language, such as tying the definition of “life threatening” to prior regulations dealing with that subject.  The two provisions of most interest to us – concerning RTT adverse events and immunity from civil suits – had been pretty good before, and stayed that way.  Reporting requirements became slightly less onerous.  A “sense of the Senate” section at the end ensures no resurrection of the Abigail Alliance foolishness regarding a constitutional right to medications.  So it’s done, but our basic skepticism remains unchanged – we don’t think that the entire exercise was worth the candle, given existing FDA compassionate use regulations, and we strongly doubt that many people, if anyone, will be helped.  Right to try was a right-wing shiny object, a distraction from the serious problems stemming from our chaotic approach to health care.

According to something we read recently on the FDA Law Blog, a “New Vermont Law Seeks to Allow Wholesale Importation of Drugs from Canada.”  We view that legislation similarly to RTT.  Canadian drug importation is a left-wing shiny object, also distracting politicians from the country’s serious health care problems.  Think about it.  California alone has a greater population than Canada.  Any large-scale importation of cheaper Canadian drugs to the United States would almost immediately cause shortages in Canada.  Given the current tit for tat, we would expect Canada to react by slapping an export tariff on prescription drugs to force United States consumers to continue paying for the inefficiencies in our health care delivery system.

But putting stupid, unnecessary trade wars to one side, let’s focus on our sandbox – product liability.  What would the product liability effects of the Vermont program, as created by the new legislation, be?

The legislation authorizes the state to design a program whereby, “a State agency that shall either become a licensed drug wholesaler or contract with a licensed drug wholesaler” in order to import prescription drugs from Canada to Vermont – all in supposed compliance with federal law. 18 Vt. S.A. §4651(a)(1).  The arrangement is to “use Canadian prescription drug suppliers regulated under the laws of Canada.”  Id. §4651(a)(2).  While the imported Canadian drugs are supposed to meet FDA “safety, effectiveness, and other” standards, id. §4651(a)(3), there is no requirement that their Canadian labeling be altered.  The Vermont state agency:

Shall . . . (1) become licensed as a wholesaler or enter into a contract with a Vermont-licensed wholesaler; (2) contract with one or more Vermont-licensed distributors; (3) contract with one or more licensed and regulated Canadian suppliers; [and] (4) engage with health insurance plans, employers, pharmacies, health care providers, and consumers. . . .

Id. §4655(1-4).  Nowhere in the statute are the ultimate manufacturers of the Canadian drugs even mentioned.  The statute does not envision any contact between the drug companies and the state importing agency.  How does Vermont expect to handle drug recalls?  Controlled substances?

The statute also raises interesting product liability questions.  This being Vermont, the statute has no provisions creating any sort of immunity from suit.  So it appears to us that, by inserting one of its agencies into the chain of drug distribution, Vermont has exposed itself to product liability suits should any of the drugs it sells cause injury.  Equally important, the statutory scheme probably makes the state the prime target of any such litigation.  In all likelihood, none of the drug manufacturers will be subject to personal jurisdiction in Vermont.  They will not be selling any drugs in Vermont.  They will have labeled their drugs in accordance with Canadian, not American, regulations.  They will have no notice of their drugs being diverted from Canada to Vermont.  In terms of Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017), and Daimler AG v. Bauman, 571 U.S. 117 (2014), the drugs will enter Vermont solely by virtue of the conduct of unrelated third persons.

Just as we pointed out flaws with the immunity provisions of various versions of right-to-try statutes, the immunity issues here also implicate the viability of the Vermont program, albeit in a different fashion. With no statutory immunity, and no ability to obtain jurisdiction over drug manufacturers for the Canadian market, the statute paints a great, big target on the back of the state importing agency, as the deepest pocketed potential defendant available to all potential plaintiffs who might take the drugs thereby imported into the state.  Sovereign immunity won’t help, since the Vermont scheme has the state engaging in commerce, not in any traditional governmental role.

Both sides of the political spectrum unfortunately share an affinity for largely meaningless, feel-good prescription drug-related schemes.  Importing drugs from the Great White North, like the Vermont program envisions, would be rife with problems, including saddling states with product liability.  Maybe that is inevitable where states seek to act as commercial entities.

A little more than six months ago, we reviewed then-pending federal right-to-try legislation.  Since then it’s become a shiny object, capable of distracting those governing the country from more important matters.  One version, H.R. 5247,  just passed the House of Representatives.  Another version, S. 204, which we reviewed in our prior post, passed the Senate last August.

Setting aside from our general view that right-to-try legislation isn’t enough (if any) of an improvement over the FDA’s already operating compassionate use program to be worth the legislative bother, is this version any better than the last?

The answer is yes.

First of all, it’s more limited.  The prior version applied to any “life threatening condition,” without requiring that the threat be imminent.  The House-passed bill is not as overbroad.  This new version applies only to conditions with “reasonable likelihood that death will occur within a matter of months.”  That’s much more in line with how “right-to-try” has been pitched to the public – as a matter of last resort.

The other major gripe we had with the terms of the prior Senate bill – preemption of tort litigation – has also been addressed.  Last time, any immunity for manufacturers participating in the program was predicated on “compliance,” which, as anyone paying attention knows, is easily pleaded around and thus hardly worth the paper it was printed on.  The relevant language now eliminates that caveat:

No manufacturer or sponsor (or their agent or representative) of an investigational drug shall be liable for any alleged act or omission related to the provision of such drug to a single patient or small group of patients for treatment use in accordance with subsection (b) or (c) of section 561 or the provision of an eligible investigational drug to an eligible patient in accordance with this section, including, with respect to the provision of an investigational drug under section 561 or an eligible investigational drug under this section, the reporting of safety information, from clinical trials or any other source. . . .

(Emphasis added).  This provision does several things, all of which improve upon the prior bill.  First, it eliminates the compliance prerequisite to preemption.  It’s now a flat “[n]o manufacturer . . . shall be liable.”   Second, as the highlighted language, above, makes clear, the same immunity from tort will apply both to right-to-try and to participation in the FDA’s compassionate use program (FDCA §561(b-c), a/k/a 21 U.S.C. §360bbb(b-c)).  That’s only fair, since there is no reason in the world for a manufacturer to be worse off, from a preemption perspective, for participating in an FDA-supervised program.  Third, the statute makes clear that there can be no liability for purported failure to report adverse events.

The absolute prohibition on liability for non-participation, which we liked before, is if anything stronger in H.R. 5247.  We certainly don’t want to see any resuscitation of the Abigail Alliance nuttiness.

The rest of the House-passed bill also looks pretty much the same, except for a provision governing adverse event reporting both for right-to-try and for compassionate use.  As before (although the language might be somewhat different), H.R. 5247 includes an informed consent provision, general reporting requirements, incorporation of the regulatory provisions limiting charges for investigational drugs, a general prohibition (with a quite limited exception) on the FDA using adverse events to interfere with the approval process of eligible investigational drugs, and limitations on liability for participating health care providers.  As to this last point, there are several exceptions for aggravated conduct, one of which is a state-law “intentional tort.”  Given that a few states (Pennsylvania, we know) continue to treat informed consent actions as battery claims, that language may result in broader participant liability (and thus more reluctance to participate) than the bill’s drafters intend.

We remain skeptical about whether right-to-try statutes actually help anyone, as opposed to being political grandstanding.  That said, from the perspective of attorneys representing pharmaceutical companies, this bill is about as good as it could be, and – to the extent that it extends preemption to the compassionate use program – it even marginally improves current law.

Like a lot of large firms, Reed Smith has a number of blogs. We don’t mention them much because, DDL has product liability pretty well covered, and the others mostly don’t overlap a lot with what we do.  But occasionally….

The other day, Reed Smith’s Health Industry Washington Watch blog described a couple of pieces of legislation that, without much fanfare, passed a subcommittee of the House of Representatives (Energy and Commerce Health Subcommittee ) while everyone was distracted, watching the Senate’s struggles to keep the government functioning.

We’re interested because both of them, were they ever to be enacted into law, could affect our sandbox.

The first bill, H.R. 2026, is the Pharmaceutical Information Exchange (“PIE”) Act (see here for more information)  This bill would be another step forward in the now decades-long struggle to legalize truthful manufacturer communications about off-label uses.  It’s not very long – one paragraph:

Health care economic information or scientific information provided to a payor, formulary committee, or other similar entity with knowledge and expertise in the area of health care economic analysis carrying out its responsibilities for the selection of drugs for coverage, reimbursement, or other population-based health care management, shall not be considered false or misleading or any other form of misbranding . . ., if it is based on competent and reliable scientific evidence and relates to an investigational new drug or an investigational use of an approved drug. In order for information relating to an investigational use of an approved drug to be provided pursuant to this subparagraph, there must have been submitted to the Secretary a supplemental application for approval of such use, or the study or studies needed to support the submission of a supplemental application for such use must have been completed with the intention that a supplemental application will be submitted to the Secretary for approval of the use.  For purposes of this subparagraph, scientific information includes clinical and pre-clinical data and results relating to an unapproved drug therapy, or drug indication, or other condition of use being investigated or developed.

We’re not sure why, but as phrased PIE only applies to drugs, but not medical devices.  [subsequent note:  This has been fixed by this amendment, so that PIE applies to both drugs and devices.]

As passed by the House, PIE allows off-label communications basically to third-party payors (“TPPs”), about off-label uses.  Communications can begin when “the study or studies needed to support the submission of a supplemental application [to the FDA] for such use . . . have been completed.”  If the supplemental application has been submitted, great, but it doesn’t need to be.  And more than just studies can be discussed – so can “clinical and pre-clinical data and results,” as long as it qualifies as “competent and reliable scientific evidence.”

PIE still doesn’t comport with the First Amendment, since it limits both the audience and the circumstances under which manufacturers may speak about truthful scientific information, while not imposing any limits on anyone else.  Thus it still discriminates both by topic and speaker under Reed v. Town of Gilbert, 135 S. Ct. 2218, 2230 (2015).  Nonetheless PIE would be a decent step in the right direction in terms of litigation.

First, it would greatly reduce litigation by TPPs over alleged off-label promotion.  Second, it would be another exception to the FDA’s increasingly tattered prohibition of truthful off-label speech, and each exception makes the ban itself less defensible against First Amendment challenges.  See Greater New Orleans Broadcasting Ass’n, Inc. v. United States, 527 U.S. 173, 190 (1999) (holding the “regulatory regime is so pierced by exemptions and inconsistencies that the Government cannot hope to exonerate it”).  Third, it makes the other side’s rhetoric against off-label promotion less credible, particularly on occasions when the exact same information is already being transmitted to TPPs.  Indeed, one could argue that a prescribing physicians’ medical practice is a “similar entity with knowledge and expertise in the area of health care economic analysis carrying out its responsibilities for the selection of drugs for . . . other population-based health care management.”

The second bill is called the Over-the-Counter Monograph Safety, Innovation, and Reform Act (“OM-SIRA”).  Apparently the subcommittee passed a “discussion draft” that doesn’t even have an “H.R.” number.   Without making a word-for-word comparison, this draft appears substantively the same as S.2315, which is available here.  OM-SIRA deals with nonprescription drugs that are marketed without an approved new drug application.  Yes, there are such things, and we blogged about preemption issues related to them here.  And preemption is what piques our interest about OM-SIRA.  As summarized by the Reed Smith blog, OM-SIRA:

would create a system for future changes to drug monographs through an administrative order procedure with the opportunity for development meetings or other consultations, submission of comments on proposed orders, and dispute resolution procedures.

This means that OTC drugs under OM-SIRA would be subject to the administrative proceedings created by the bill before their manufacturers could modify those products or their labels.  Interestingly, the FDA can act unilaterally to modify a label, but not OTC manufacturers.  §505G(b)(4)(B)).   Manufacturers can act unilaterally only as to “minor” changes that do not affect “safety and effectiveness”  §505G(c).

If OM-SIRA were enacted in its present form, it appears to us that the administrative approval procedures in the bill would provide a basis for implied impossibility preemption under the “independence principle” of PLIVA, Inc. v. Mensing, 564 U.S. 604 (2011), and Mutual Pharmaceutical Co. v. Bartlett, 570 U.S. 472 (2013).  Since implied preemption operates independently of express preemption, it would not be subject to the partial savings clause in 21 U.S.C. §379r(e), which would be very good thing for defendants in such litigation.

With respect to both bills, we’ll see what happens.  Maybe Congress won’t be PIE in the sky this time around.

The federal Advisory Committee on Rules of Civil Procedure released its latest Civil Rules Agenda Book on November 7, 2017. A copy of it is available here.  A couple of items on the agenda should be of interest to blog readers.

The first topic has to do with proposed changes Fed. R. Civ. P. 30(b)(6), dealing with corporate witness designations (see tab 5 beginning on page 171). The following changes are under consideration:

  • Inclusion of specific reference to Rule 30(b)(6) among the topics for discussion at the Rule 26(f) conference, and in the report to the court under Rule 16.
  • Amending Rule 30(b)(6) to clarify that testimony at a Rule 30(b)(6) deposition is not a judicial admission.
  • Requiring and/or permitting supplementation of Rule 30(b)(6) testimony.
  • Forbidding contention questions in Rule 30(b)(6) depositions.
  • Adding a provision for objections at Rule 30(b)(6) depositions.
  • Amending Rule 30(b)(6) to address the application of limits on the duration and number of depositions.

The second topic has to do with requiring disclosure of third-party litigation funding arrangements (see tab 7B beginning on page 345). The proposed rules change would amend Fed. R. Civ. P. 26(a)(1)(A) to add a new subsection (v) to the items subject to mandatory initial disclosure:

(v) for inspection and copying as under Rule 34, any agreement under which any 5 person, other than an attorney permitted to charge a contingent fee representing a party, has a right to receive compensation that is contingent on, and sourced from, any proceeds of the civil action, by settlement, judgment or otherwise.

The committee notes several areas of “disagreement” that would have to be resolved before a rules change could be adopted. These are:

  • Definition of what types of third-party litigation funding agreements are covered.
  • Whether a new disclosure rule for third-party litigation funding should be parallel to the existing requirement for disclosure of a defendant’s insurance policies.
  • Extent to which third-party litigation funders control or impact the conduct of the litigation at issue.
  • Extent to which third-party litigation funders control or impact settlement of the litigation at issue.
  • Possible impact of disclosure of third-party litigation funding on the parties’ strategic behavior.
  • Potential for conflicts of interests created by third-party litigation funding.
  • Whether disclosure of third-party litigation funding is important to judicial recusal.
  • Whether disclosure of third-party litigation funding would be a threat to attorney/client privilege or work product protection.
  • How proportionality affects disclosure of third-party litigation funding.
  • Whether third-party litigation funding increases frivolous litigation.
  • Possible conflict between disclosure of third-party litigation funding and state regulation of professional responsibility.

It appears uncertain whether the committee will seriously consider this proposal or continue to defer action as it did in 2014.  A possible motivating factor, not present in 2014, is the threat of congressional action to amend the rules.

Readers who are interested in either of these two issues can comment on them here.

We remember how, shortly after the atrocious decision in Johnson & Johnson v. Karl, 647 S.E.2d 899 (W. Va. 2007), rejecting altogether the learned intermediary rule, litigation tourists visiting West Virginia argued that Karl represented that state’s “public policy” and therefore the learned intermediary rule could not apply even to their out-of-state cases under the “public policy” exception to the ordinary rules for sorting out choice of law issues.  This was also back in the halcyon days (for the other side) of essentially unlimited plaintiff forum shopping pre-Bauman, so the specter existed that, if this argument succeeded, plaintiffs from all over the country, or even the world, would flock to West Virginia, and by the mere fact of their litigation tourism, thereby rid themselves of one of our side’s most significant arguments.

A couple of West Virginia federal courts were sufficiently pro-plaintiff to buy that “public policy” choice-of-law analysis.  Woodcock v. Mylan, Inc., 661 F. Supp.2d 602, 609 (S.D.W. Va. 2009) (“[b]ecause West Virginia has rejected the learned-intermediary doctrine on public-policy grounds and applying Alabama law to the marketing defect claim would violate that public policy, West Virginia law applies to that claim”); Vitatoe v. Mylan Pharmaceuticals, Inc., 696 F. Supp.2d 599, 610 (N.D.W. Va. 2010) (“it is impossible to apply the substantive law of Louisiana to [plaintiff’s] inadequate warning claim without violating West Virginia public policy”; following “Woodcock’s helpful public policy analysis”).  For doing this, we trolled Woodcock with eighth place on our 2009 bottom ten decisions list:

This decision invoked “forum public policy” to apply West Virginia’s rejection of the learned intermediary rule to a forum shopping plaintiff from Alabama – a staunch learned intermediary state.  That can’t be right.  Practically all major tort law doctrines are grounded in a court’s sense of “public policy.”  Thus the “forum public policy” exception (previously limited to legislatively set policy) becomes another constitutionally suspect means of applying forum law to cases with no significant ties to the state in question.  Any other forum shopper can presumably make the same argument. We’re sure we haven’t seen the last of this.  We blogged about Woodcock here.

Fortunately, the West Virginia legislature stepped in and did the right thing, making its own declaration of West Virginia public policy in 2011:

Choice of Law in Pharmaceutical Product Liability Actions.

It is public policy of this state that, in determining the law applicable to a product liability claim brought by a nonresident of this state against the manufacturer or distributor of a prescription drug for failure to warn, the duty to warn shall be governed solely by the product liability law of the place of injury (“lex loci delicti”).

W. Va. Code §55-8-16(a).  We cheered that development here.

Of course, the entire Karl learned intermediary brouhaha became moot (or so we thought) several years later when the legislature did themselves one better and directly overruled Karl on the merits.  See W. Va. Code 55-7-30 (restoring the learned intermediary rule).  Even more vigorously, we cheered on that development – after the fact, of course, since we made sure not to breathe a word about this before it was a done deal (we know the other side reads our blog, so there are some things we do keep quiet about).

Given this background, it is with no small degree of schadenfreude that we bring to you M.M. v. Pfizer, Inc., ___ S.E.2d ___, 2017 WL 5077106 (W. Va. Nov. 1, 2017).  M.M. involved the West Virginia sojourn of other litigation tourists, this time from Michigan.  Id. at *2.  Michigan, as anyone involved in the defense of prescription medical product liability litigation knows, has a statute that provides the strongest FDA compliance defense in the country (although Texas is close):

In a product liability action against a manufacturer or seller, a product that is a drug is not defective or unreasonably dangerous, and the manufacturer or seller is not liable, if the drug was approved . . . by the [FDA], and the drug and its labeling were in compliance with the [FDA’s] approval at the time the drug left the control of the manufacturer or seller. . . .

Mich. Comp. Laws Ann. §600.2946(5).  As we’ve mentioned before, that statute has produced a “diaspora” of Michigan plaintiffs all running away from the policy judgment made by the legislature of their chosen state of residence.  Those prior plaintiffs didn’t have much luck, and as it turns out, neither did this one.

This time, even if West Virginia courts might have been inclined to cut the Michigan plaintiffs a break, they ran headlong into the West Virginia choice-of-law statute mentioned above.  Even though it was passed to overturn half-baked Karl-based “public policy” determinations, the statute’s literal terms establish West Virginia choice of law “public policy” as to all prescription drug warning cases.  Thus, the M.M. plaintiff – despite having nothing to do with Karl – was entirely out of luck.  “Here, there is no dispute that the injuries alleged by [plaintiffs] all occurred in the State of Michigan.  Thus, [the] failure to warn claim is governed by Michigan law, which forecloses such a claim if the drug was approved by the FDA and the manufacturer complied with the FDA’s labeling requirements.”  2017 WL 5077106, at *3 (also discussing why fraud-on-the-FDA exception to statute doesn’t apply).  Thus, “Michigan law forecloses [plaintiffs’] failure to warn claim.” Id. Interestingly, the court added:

To recognize such a claim under West Virginia law where the same already is foreclosed in the same case by the law of another jurisdiction, however, would contradict the full faith and credit due our sister jurisdictions.

Id. (citations omitted).  “Full faith and credit”?   We confess we haven’t seen that much, indeed ever, before in prescription medical product liability litigation, but anything that keeps a plaintiff from relitigating something they’ve already lost finds favor here.

Unfortunately for these plaintiffs, they were also entirely unable to come up with any defect claim that wasn’t really a statutorily covered warning claim.  “[B]oth the strict liability and negligence claims allege that [defendant] improperly failed to include . . . warnings on its labeling, which, again, constitute allegations that [defendant] failed to warn.”  Id. at *4.  Even if West Virginia law could apply, the choice-of-law statute meant that West Virginia law kicked things back to Michigan, and was “foreclosed thereby.”  Id.  Both their strict liability and negligence claims, although making boilerplate allegations, were “merely a restatement of [plaintiffs’] failure to warn claim,” id. (strict liability), or “merely a reiteration of [plaintiffs’] failure to warn claim.”  Id. at *5 (negligence).  Any way one looked at the case, plaintiffs alleged only a failure to warn, and failure to warn claims had to be determined by Michigan law, where plaintiffs lost.

[B]ecause [plaintiffs’] failure to warn claim is governed by Michigan law, and the governing Michigan statutes provide that a manufacturer cannot be held liable where it has complied with the FDA reporting, disclosure, and labeling requirements, there exists no duty that could have been breached so as to establish a claim for negligence.

Id. at *5.

Now that BMS has pulled the welcome mat away from litigation tourists, we don’t expect much more of a Michigan diaspora, but even if there were, the West Virginia choice-of-law statute, enacted for an entirely different purpose, will preclude any of them from relying on more favorable West Virginia law.  See Id. at *3 n.2 (noting that §55-8-16(a) has since been expanded so that it applies to “all liability claims at issue,” not just warnings).

For the second time in three years the Pennsylvania legislature has proven itself entirely unable to carry out its most basic function, which is to pass a budget – any budget – which is balanced and otherwise meets constitutional requirements.  Instead, it seems bent on distracting the public from its abject failures with empty gestures.

Thus, we saw in Law 360 the other day that the legislature has passed, and the governor has agreed to sign, “right to try” legislation.  As we’ve discussed before, right to try legislation purports to make it easier for terminally ill patients to obtain access to drugs (and other FDA-regulated products) that have not completed the FDA’s long and arduous approval process.  In fact, we have seen no evidence that such legislation has ever actually helped anyone.  State right to try legislation has been ineffective chiefly for three reasons:  (1) it is federally preempted by the FDA’s compassionate use program, (2) manufacturers are unlikely to opt into these purely voluntary programs because any adverse events involving what would be a very sick patient population would have to be reported to the FDA and thus could jeopardize eventual approval, and (3) the legislation does not adequately protect manufacturers from potential liability for allowing the use of unapproved drugs.  Why do we care?  Because we worry about terminally ill patients suing manufacturers to force them to provide investigational drugs, which has been unsuccessfully tried in the past, and might be tried again in the future.

Obviously, no state legislation can do anything about problems #1 or 2, because those are matters governed by federal law that would require a federal statute.  As for problem #3, states have immunized manufacturers from state-law liability to a greater or lesser extent, so what about Pennsylvania?

Here’s a link to the text (as amended) of the current bill, HB45.

While there’s a section devoted to “health care provider immunity” (§5(a)), the potential liability of the entities that actually manufacture the investigational drugs (and other products) in question is only addressed in the section (§6) involving “construction” of the statute. That section provides – with unnecessary verbosity removed for clarity:

Nothing in this act may be construed as creating a private cause of action against a manufacturer of an investigational drug, biological product or medical device . . . for any injury suffered by the eligible patient resulting from the investigational drug, biological product or medical device, as long as the manufacturer . . . acted in accordance with this act, except when the injury results from a failure to exercise reasonable care.

(Emphasis added).

Pathetic. Probably worse than nothing. This section says zilch about liability under existing common-law theories – only about “creating” a new “private cause of action.”  Nor does it even preclude a new, private statutory cause of action.  To the contrary, it allows one, only it must be based on negligence (“failure to exercise reasonable care”).  As we’ve pointed out before, negligence is already the existing basis for Pennsylvania product liability for prescription medical products. See, e.g., Hahn v. Richter, 673 A.2d 888, 889 (Pa. 1996) (another case Bexis worked on way back when).  Thus, the Pennsylvania Right To Try legislation provides no additional protection to participating manufacturers at all – even those who complied with the statute – instead it appears to allow an additional, redundant negligence-based private statutory cause of action.

That being the case, there is no incentive whatsoever for any FDA regulated manufacturer to participate in the putative Pennsylvania Right To Try program, and every reason for them to refrain from doing so.  Rather, it’s an empty gesture – intended to distract the public from the legislature’s inability to perform its most basic constitutional duties.

We’ve generally been skeptical of state “Right To Try” statutes, for several reasons.  First, to the extent that they try to circumvent the FDCA, they’re likely to be preempted.  Second, drugmakers aren’t likely to distribute experimental drugs due to liability concerns, and these statutes don’t go far enough in removing that threat.  Third, such statutes interfere with drug development because they involve the inclusion of people who don’t meet study criteria – often because they are too sick – which is likely to increase the number of adverse results, all of which must be reported to FDA.

Apparently the number of states with Right To Try statutes is up to 37 – but we have yet to learn of a single individual that has successfully utilized any of them.  For the reasons we’ve stated before, we’re not surprised.

But earlier this month, the United States Senate just passed (apparently by voice ) a reworked version of the “Trickett Wendler Right to Try Act” (S. 4788) that we discussed in our prior post.  A federal act would, of course, obviate the preemption problem, or at least replace it with issues of reconciling two federal statutes – which would be a somewhat less daunting a challenge.

Because of that senate action, we’re taking another look at the proposed legislation, a link to which is here.  First, it applies to anyone “with a life-threatening disease or condition” “who has exhausted approved treatment options and is unable to participate in a clinical trial.”  §561B(a)(1)(A-B).  Eligibility must be “certified” by a treating physician who “will not be compensated directly by the manufacturer for so certifying.”  Id. §561B(a)(1)(B).

The “investigational drugs” that the legislation would make available must have completed a preliminary “Phase 1 clinical trial” and must be under active “investigation in a clinical trial that is intended to form the primary basis of a claim of effectiveness in support of approval or licensure.” Id. §561B(a)(1)(C).  Essentially S.4789 seeks to open up to terminal patients access to any unapproved drugs under current investigation, provided they have passed the relatively basic threshold Phase I determinations that they aren’t acutely toxic to humans and might have some plausible benefit.  Phase I investigations:

are designed to determine the metabolism and pharmacologic actions of the drug in humans, the side effects associated with increasing doses, and, if possible, to gain early evidence on effectiveness.  During Phase 1, sufficient information about the drug’s pharmacokinetics and pharmacological effects should be obtained to permit the design of well-controlled, scientifically valid, Phase 2 studies.

21 C.F.R. §312.21(a).  Phase 1 studies are small, with between “20 to 80” study participants. Id.

Getting down to litigation-related brass tacks, S.4789 contains a subsection, §561B(something) (b) – we’re frankly not sure of the numbering – entitled “no liability,” that would provide as follows:

(1) ALLEGED ACTS OR OMISSIONS.—With respect to any alleged act or omission with respect to an eligible investigational drug provided to an eligible patient pursuant to section 561B of the Federal Food, Drug, and Cosmetic Act and in compliance with such section, no liability in a cause of action shall lie against—

(A) a sponsor or manufacturer; or

(B) a prescriber, dispenser, or other individual entity (other than a sponsor or manufacturer),

unless the relevant conduct constitutes reckless or willful misconduct, gross negligence, or an intentional tort under any applicable State law.

(2) DETERMINATION NOT TO PROVIDE DRUG.—No liability shall lie against a sponsor manufacturer, prescriber, dispenser or other individual entity for its determination not to provide access to an eligible investigational drug under section 561B of the Federal Food, Drug, and Cosmetic Act.

(3) LIMITATION.—Except as set forth in paragraphs (1) and (2), nothing in this section shall be construed to modify or otherwise affect the right of any person to bring a private action under any State or Federal product liability, tort, consumer protection, or warranty law.

Meh. We’re not impressed.

We consider this language a significant step backwards from the non-liability language of the 2016 version (S.2912) of this legislation that we reviewed here.  That language would have provided that compliance with the act allowed “no liability” “[n]otwithstanding any other provision of law.”  The current language of S.4789 would allow liability – despite “compliance” – as long as a plaintiff could allege “reckless or willful misconduct, gross negligence, or an intentional tort.”  That’s not much protection at all, given how readily the other side throws around such allegations, and how infrequently judges throw them out.  In subsection 1, “Reckless/willful” is a standard for punitive damages, which routinely survive dismissal in MDLs and other actions around the country.  “Gross negligence” is a standard even less than that – merely an aggravated form of negligence that doesn’t require any finding of intent at all.  Intentional torts include fraud, which is currently included in just about any product liability complaint.  Battery, which encompasses informed consent in many states, is also an intentional tort.

In short, the heading “no liability” is itself misleading.  Manufacturers complying with S.4789 would be risking plenty of potential liability in today’s litigation-addicted society.  Underscoring the lack of protection that this section provides to participating parties, subsection 3 further specifies that, outside of subsections 1 and 2, no protection at all from civil liability is created by this bill.

Subsection 2 is a lot more absolute: “No liability” lies against anybody for a “determination not to provide access.”  In light of the wholly inadequate immunity language in Part 1 of the “no liability” section of S.4789, it becomes difficult to recommend to a nervous client anything other than the conduct that would bring the absolute non-liability of subsection 2 into play.  Manufacturers stand to gain nothing by participating in this postulated federal Right To Try program – it’s not even clear if they can charge anybody for the cost of the investigational drugs in question – so don’t expect them to them to gravitate to something with the potential to open up new liability for the provision of untried, incompletely tested, investigational drugs.  The Swiss-cheese liability shield of S.4789, by itself, is an invitation to failure.

The legislation’s approach to the reporting of adverse events to the FDA is better, but nevertheless still comes with a significant caveat:

Notwithstanding any other provision of . . . Federal law, the Secretary may not use a clinical outcome associated with the use of an eligible investigational drug pursuant to this section to delay or adversely affect the review or approval of such drug . . . unless—

(A) the Secretary makes a determination, in accordance with paragraph (2), that use of such clinical outcome is critical to determining the safety of the eligible investigational drug; or

(B) the sponsor requests use of such outcomes.

§561B(c)(1).

Think that the “unless” won’t happen?  We’re hardly sanguine.  Remember, the FDA was once run by the likes of current-plaintiff-expert David Kessler.  Consider the gyrations that the FDA has gone through, first to create and for the last couple of decades to justify, its ban on truthful speech regarding off-label uses.  If there has ever been an agency more likely than the FDA to use its discretionary authority to “hide elephants in mouseholes,” Gonzales v. Oregon, 546 U.S. 243, 267 (2006) (citing, inter alia, FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120, 160 (2000)), we haven’t encountered it.  The bill contains no definition of “critical”; its only limit on the “unless” exception is that be in writing and made “part of the administrative record” by the FDA commissioner.  §561B(c)(2).

All in all, we are disappointed with the current version of the federal Right To Try statute.  For all the aspersions that the other side likes to heap on this Congress as being “pro-business,” this version of Trickett Wendler is less pro-business, and more plaintiff friendly, than the 2016 version that was written by a Senate controlled by Democrats.  If passed, we doubt that it would be any more effective than the current hodge-podge of state Right To Try statutes in saving the lives of terminally ill patients.

 

One of the issues that the federal Civil Rules Committee’s discovery subcommittee considered, but that eventually fell by the wayside, on the way to the 2015 discovery rules amendments, were proposals to convert to a “requestor pays” discovery system.  That would be a very significant change, and one of the criticisms that the other side leveled at such a system was that only rich people (or at least only rich plaintiff lawyers) could afford to bring suit, given the prospect of having to pay for expensive discovery that current system now gives plaintiffs for free.

Well, not for free.  Nothing is free.  The current “producer pays” discovery system gives plaintiffs a windfall by allowing them to demand production of millions of dollars’ worth of documents – and as importantly, electronically stored information (“ESI”) − and to impose those costs almost entirely on defendants.  As any economist will tell you, any system that provides access to something for free or at greatly below-market cost, be it health care, “dumped” imports, or discovery, creates greater demand for whatever the below-cost item is than would exist otherwise.

It’s worse in the legal system, because the other side’s heightened demand for “free” discovery has the concomitant effect of increasing the nuisance (that is to say, settlement) value of all litigation in which such demands are made – since one’s opponent is stuck with the bill.

All our side got out of the 2015 rules amendments cycle on requestor pays is a provision more clearly recognizing the authority of courts to shift discovery requests.  See Fed. R. Civ. P. 26(c)(1)(B).  As we’ve mentioned, a couple of courts have done this during prescription drug/device MDL litigation.  See In re Bard IVC Filters Products Liability Litigation, 317 F.R.D. 562 (D. Ariz. 2016); In re Benicar (Olmesartan) Products Liability Litigation, 2016 WL 5817262 (D.N.J. Oct. 4, 2016).  Both of those cases involved what the courts viewed as excessive and unnecessary MDL discovery targeted at the defendants’ overseas activities.

Now we’ve found a third case – it took a little longer because it didn’t involve prescription medical products – that also invoked the new cost-shifting provisions in a very familiar (and frustrating) situation.  McClurg v. Mallinckrodt, Inc., 2016 WL 7178745 (E.D. Mo. Dec. 9, 2016), wasn’t an MDL, but it could have been, except for a limited geographic scope.  Many hundreds of plaintiffs were all seeking recovery for alleged radiation-induced injuries from the same two defendants.

A situation depressingly familiar to any defense counsel in mass tort litigation developed.  Although plaintiffs are nominally responsible under the rules for collecting (and paying for the collection of) their own medical and related records in response to discovery requests, they botched the job so badly that the defendants – in whose interests it was to have these records – had to step in and do it themselves on their own dime.  Plaintiffs did produce “a list of known health care providers and a signed authorization for the release of medical records.”  Id. at *1.  “Because Plaintiffs did not timely and fully produce all of their records, Defendants contracted with a third-party vendor . . . to collect records directly from Plaintiffs’ health care providers and employers.”  Id.  Also, “the parties in this matter could not agree to a reasonable scope of record collection and allocation of costs.”  Id. at *4.

So things stood until bellwether plaintiffs were selected (interestingly, by random selection, id. at *2).  All of a sudden the plaintiffs became very interested in the additional records that the defendants had been collecting at their own expense.  So they served discovery requests seeking those records – only for the bellwether plaintiffs – for free.  Id. (“Plaintiffs served document requests seeking ‘all documents and records’ that Defendants had collected regarding each of the 16 Bellwether Plaintiffs”).  Somewhat ironically, they also claimed that the defendants had engaged in excessive records gathering, and therefore also demanded access to the defendant’s records database (also set up at defendants’ sole cost) so they could select which records they wanted.  Id. (“Plaintiffs assert that they, too, wish to access [defendants’] secure portal free of charge, in order to decide which records they want”).

The two McClurg defendants’ response was “hell, no; not without you sharing the cost equally – that is shouldering one-third of the expense along with the defendants each sharing a third.  Id. (subject to a credit for whatever records plaintiffs had actually collected and turned over).

The McClurg court shifted costs, not 33% but 18%, to plaintiffs under Rule 26(c)(1)(B).  2016 WL 7178745, at *3.  Cost-shifting was necessary so that the plaintiffs did not become free riders:

The Court finds . . . that good cause exists to order some amount of cost-sharing before Plaintiffs may obtain the records collected by Defendants here.  Plaintiffs would ordinarily have been, and pursuant to the Court’s order were, responsible for gathering and producing their own records.  But while Plaintiffs appear to have produced some records as new complaints were filed, they did not do so in a complete and timely manner.  Indeed, Plaintiffs apparently produced records for a few of the Bellwether Plaintiffs just one or two days before their scheduled depositions.

Id.  That “Plaintiffs [were] seek[ing] access to the portal establish and maintained at Defendants’ expense” further justified a cost allocation order.  Id.

Although it was “unfortunate” that the parties never sought court intervention after failing to reach a records production protocol, id. at *4, giving plaintiffs free access to records collected and maintained at the defendants’ expense was unfair.  Id. (“it would be unfair to allow Plaintiffs to gain the benefit of Defendants’ early record collection and creation of the portal, which helped move the case forward, without contributing a fair share of the overall costs of such collection”).  Crediting plaintiffs’ complaints about excessive collection, McClurg reduced the percentage to 18%.  Id. (eliminating records collected concerning plaintiffs that the defendants knew could not be in the bellwether pool).  Plaintiffs also received a credit for the comparatively small amount of timely produced records they had collected.  Id.

Since the same failure by plaintiffs to collect their own records competently is endemic to prescription medical product MDLs, the cost-shifting in McClurg is of significant interest to us.

In fact, the results in all three of these cases – Bard IVC, Benicar, and McClurg – are also of interest to us because they provide pointers to where the requestor pays debate might reasonably go.  We certainly don’t agree with the other side’s largely bogus argument that across-the-board requestor pays discovery might shut the courthouse doors on the “poor” plaintiffs in the litigation-funded, advertising-driven mass tort industry.  In such litigation, there “does not appear to be a significant financial disparity in the parties’ ability to finance these putative litigations.  Thus, what this Court and other courts similarly situated are faced with is ‘Goliath versus Goliath.’”  Arch v. American Tobacco Co., 175 F.R.D. 469, 496 (E.D. Pa. 1997).

However, since the federal rules are supposed to be transubstantive, we will accept for the sake of argument that some deserving plaintiffs in some types of litigation might be excluded by a blanket requestor pays regime.  As an alternative, we think that the rules should include a presumption that the requestor pays for certain types of unduly burdensome, or otherwise unfair, discovery.  While such discovery might nonetheless be “proportionate,” were it to uncover something significant, these types of discovery are expensive and not particularly likely to produce evidence usable at trial.

Here are some examples of discovery that we have encountered that we think deserve to be presumptively discoverable only at the requestor’s expense – there are undoubtedly more:

  • Discovery into a defendant’s overseas activities, particularly if the documents are not in English (Bard IVC and Benicar both involved this kind of discovery);
  • Discovery into information independently gathered by the defendant for purposes of the litigation, excepting witness statements, and other items specified by the rules as peculiarly relevant (that’s McClurg);
  • Discovery into products manufactured by defendants other than those used by plaintiffs;
  • Discovery into product risks other than those suffered by plaintiffs;
  • Discovery into information in the possession of third parties, including government agencies;
  • Discovery into time periods where recovery is barred by relevant statutes of limitations;
  • Discovery into post-litigation information, after the alleged conduct has ceased;
  • Subjects of Rule 30(b)(6) depositions where the entity faced with deposition has no available percipient witnesses, and any witness would only have reviewed the same documents available to the deposing party;
  • ESI discovery into information located on inactive legacy/obsolete computer systems; and
  • Other similarly burdensome discovery, not of a type likely to produce significant evidentiary benefit, as determined by research commissioned by the Federal Judicial Center.

None of this kind of information is ordinarily essential to the hypothetical impecunious plaintiffs who would otherwise be shut out of court by having to pay for what are almost always expensive wild goose chases.

And if one of these categories turns out to be of particular importance in a given lawsuit, the requestor pays directive is only presumptive.  The party requesting the discovery would be able to go to the judge – either before or after the discovery takes place − and explain why a category of discovery, presumptively disfavored under the new regime, should be exempted from the requestor pays rule on the facts of the case in question.  Likewise, if the requestor is able to overcome the presumption beforehand, and the supposedly important discovery turns out to be a wild goose chase anyway, then the producer should be entitled to file a motion to shift those costs back to the requestor.

Implementing across-the-board requestor pays is a long shot right now, and such a dramatic change in the system could well have unintended and unforeseeable litigation consequences.  We think our proposal is not only a way to discourage types of discovery that are peculiarly prone to abuse, but might also be a way of trying out requestor pays on a smaller scale to see whether it is indeed a desirable change to the system generally.

If anybody out there is interested in this idea, have at it. Unlike discovery, our blogging is free to all readers.

Regular blog readers may recall that, every year, we eagerly await a Monday and Tuesday right around February 14th.  This has nothing to do with Valentine’s Day (though we like a dozen roses and a box of chocolates as much as the next person.)  No, at this time every year (for the past eighteen or so) we cross our fingers that there is no blizzard, beg everyone in our work life to cover any emergencies, and head to New York for the Westminster Kennel Club Dog Show.  This year was the 141st annual show, and, as always, it was a mecca for all things dog.  As we ate breakfast in our hotel, we were visited by Mobius, a red Doberman so tall he had to lean down to attempt to taste our complimentary make-it-ourselves waffle.  To board the shuttle from the Hotel Pennsylvania (worthy of its own post) to Piers 92 and 94 for the daytime breed judging, we had to step over “Sky,” a 140-pound Greater Swiss Mountain Dog sprawled in the aisle of the bus, calmly oblivious to accidental bumps and kicks and happily kissing anyone who asked.  We live for this stuff, even if our chosen favorite almost never wins.

For the atmosphere is rarified. A few years ago, the show stopped being “champions only” and admitted “class dogs” – dogs still working their way through point-earning breed classes to achieve their championships – for the first time.  But, save for the infrequent upset, the group competition (the televised portion, in which the single winner of each breed competes against the winners from the other breeds in its “group” – sporting, herding, toy, etc.) is dominated by the very top-winning show dogs in the country.  Last year, we fell in love with a gorgeous German Shepherd Dog named Rumor.  She was a heavy favorite to win it all (“Best in Show”), but was upset by C.J. the German Shorthaired Pointer and settled for Reserve Best – second place.  And she retired, to raise beautiful puppies and live the life of a cherished house pet.

But, alas, said puppies did not get made on the first attempt. And, come January, Rumor’s owner/handler decided to give her one more shot at the big one.  So she “came back out,” showed at ten shows in January, and took one more run at the Garden.  And, this time, after upsetting the favorite, Preston the Puli, to take the Herding Group, she won it all.  It was very, very cool to witness.  And we already can’t wait ‘til next year.

And there was a blog-worthy lesson to be gleaned from it all (at least if you stretch a little): if you haven’t achieved everything you want, think about taking another shot.  And H.R. 985, a bill that passed the House Judiciary Committee this week, would pick up where CAFA left off (and then some) to correct still-rampant abuse of the system by class action and MDL plaintiff lawyers, to the detriment of our clients, the judicial system as a whole, and all too often, to the plaintiffs the lawyers ostensibly represent.

Under “Purposes,” the bill states: “The purposes of this act are to – (1) assure fair and prompt recoveries for class members and multidistrict litigation plaintiffs with legitimate claims; (2) diminish abuses in class action and mass tort litigation that are undermining the integrity of the U.S. legal system; and (3) restore the intent of the framers of the United States Constitution by ensuring Federal court consideration of interstate controversies of national importance consistent with diversity jurisdiction principles.”  Worthy goals all, if a trifle ambitious. The bill’s key points read like a set of nesting boxes – just when you think you’ve opened the last, there is another present inside.  Here are some highlights:

Class Actions

  • Injury allegations: this provision requires a court to deny certification unless “the party seeking to maintain such a class action affirmatively demonstrates that each proposed class member suffered the same type and scope of injury as the named class representative.” This is ascertainability something for which we’ve advocated, and also something that our side tried unsuccessfully to get fixed through the Federal Rules Committee. Thus, the judiciary had its chance to fix this. Nothing happened, so now Congress is poised to step in. About time.
  • Conflicts of interest: this provision requires class counsel to state, in the body of the complaint, “whether any proposed class representative or named plaintiff in the complaint is a relative of, is a present or former employee of, is a present or former client of (other than with respect to the class action) or has any contractual relationship with . . . class counsel” and shall “describe the circumstances under which each class representative or named plaintiff agreed to be included in the complaint and shall identify any other class action in which any proposed class representative or named plaintiff has a similar role.”
  • Attorneys’ fees: “[N]o attorneys’ fees may be . . . paid . . . until the distribution of any monetary recovery to class members has been completed,” and “[u]nless otherwise specified by Federal statute, . . . the portion of any attorneys’ fee award to class counsel . . . shall be limited to a reasonable percentage of any payments directly distributed to and received by class members [and in] no event shall the attorneys’ fee award exceed the total amount of money distributed to and received by all class members.” We particularly like this because it would effectively put an end to cy pres, against which we’ve railed for years. By limiting the denominator for fee awards to “payments directly distributed to and received by class members” it prevents cy pres sums from being used to inflate fee awards.

There are other provisions, requiring stringent accounting provisions for settlement funds forbidding certification of issue classes unless all relevant Rule 23 prerequisites are satisfied (another thing our side tried first to fix through a change to Rule 23), and most significantly providing for severance of misjoined plaintiffs for purposes of jurisdictional determinations. This legislative elimination of fraudulent misjoinder is a key point, since it addresses the multi-plaintiff complaints we love to hate.

We note that since the “effective date” of this act provides for its application to all “pending” civil actions, cases currently in state court can be removed (or removed again) under the provision negating misjoinder as a means of preventing diversity-based removal to federal court.

Finally, in an issue close to our hearts as we daily encounter plaintiffs unwittingly victimized by so-called “litigation funders,” the bill provides, “In any class action, class counsel shall promptly disclose in writing to the court and all other parties the identity of any person or entity, other than a class member or class counsel of record, who has a contingent right to receive compensation from any settlement, judgment, or other relief obtained in the action.” A sunshine law for third-party funding is something else for which we’ve advocated.

Multidistrict Litigation:

  • Proof of exposure and injury: We were thrilled to see a “Lone Pine”-esque provision build into the MDL portion of the bill. It provides, in pertinent part, “In any coordinated or consolidated pretrial proceedings . . . , counsel for a plaintiff asserting” a claim seeking redress for personal injury [in the MDL] shall make a submission sufficient to demonstrate that there is evidentiary support (including but not limited to medical records) for the factual contentions in the plaintiff’s complaint regarding the alleged injury, the exposure to the risk that allegedly caused the injury, and the alleged cause of the injury . . . within 45 days after the civil action is transferred to or directly filed in the proceedings. That deadline shall not be extended. Within 30 days after the submission deadline, the judge . . . shall [determine] whether the submission is sufficient and shall dismiss the action without prejudice if the submission is found to be insufficient.” Thirty days later, in the continued absence of a satisfactory submission, the action is to be dismissed with prejudice. Not long ago, we advocated for amending the MDL statute to require early factual disclosure, with dismissal as the sanction for not disclosing enough to satisfy Rule 8. This is the functional equivalent.
  • Trial Prohibition (“waiving Lexecon”): MDL judges “may not conduct any trial in any civil action transferred to or directly filed in the proceedings unless all parties to the civil action consent to trail of the specific case sought to be tried.” This provision would remove the threat of MDL trials as a tool to force defendants to settle. It is something else for which we have advocated.
  • Ensuring Proper Recovery for Plaintiffs: MDL plaintiffs “shall receive not less than 80 percent of any monetary recovery obtained in that action by settlement, judgment or otherwise.”

While most of the press coverage seems to focus on class actions, to us the removal and MDL provisions are at least as important. The vast bulk of our professional life is spent in the mass tort space – mostly MDLs these days, with the occasional class action thrown in. We have become accustomed (but never inured) to plaintiffs without injuries herded by counsel who are their friends or bosses into mass actions in which they don’t belong. On the other end of the spectrum, we encounter severely injured plaintiffs who will recover next to nothing because lawyers and litigation funders own most or all of the plaintiffs’ stakes in the inevitable settlements. And, at every turn, we sit across the table from tanned and affluent plaintiff attorneys who are the only ones apparently immune to the vagaries of the system and who are the sole beneficiaries of its inequities. H.R. 985, as drafted, attempts to address many of these issues. We do have questions. Who defines “the same type and scope of injury,” for example? And we have doubts: can a bill possibly survive the powerful plaintiff attorney lobby when it attempts to resurrect the integrity of mass litigation by hitting those attorneys squarely in their pocketbooks? But we heartily and excitedly support this bill, and we know that some of its provisions are way, way better than none. We will keep you posted.