Multidistrict Litigation

MDLs are complicated.  MDLs are chaotic, messy, and ugly unless they have structure and order.  Bringing order to chaos.  Something this blogger has championed for what’s starting to be more years than she wants to readily discuss.  But without order, think of The Blob (the original 1958, Steve McQueen flick).  It creeps.  It crawls.  It eats you alive.  Same can be said of MDLs.  They have a way of growing at an alarming pace.  The number of plaintiffs.  The number of defendants.  The number of depositions.  The number of documents produced.  Just oozing out in every direction.  Eating up time, money, resources.  And, most of the creeping and crawling is directed at defendants.  Plaintiffs want to depose dozens of company witnesses (hundreds if you get into sales representatives).  Plaintiffs want millions of pages of documents, along with native productions of large databases.  And what do the individual plaintiffs have to do?  Usually no more than fill out a Short Form Complaint, a Plaintiff Fact Sheet, and sign some medical release authorizations.  And while they do that, very little is done to curb the mounting mass of lawsuits.

That is until it’s not just defendants who have to put up or shut up.  There is no doubt that requiring individual plaintiffs in an MDL to do something – anything – to justify his/her claim actually works to shrink the mass.  In the DDL biz, we call it Lone Pine, named for Lore v. Lone Pine Corp., 1986 WL 637507 (N.J. Sup. Ct. Nov. 18, 1986) in which a New Jersey state court judge ordered plaintiffs to offer proof connecting the defendant’s product to the plaintiff’s alleged injury.  We keep track of the entry of Lone Pine orders in our cheat sheet, here.  And it should be no surprise that we are strong proponents of the Lone Pine orders, especially when entered early on in litigation.  They help clean house; shake off free-riders hoping to hang in until a settlement.

A decision last week from the Abilify MDL shows just how effective Lone Pine can be.  In re Abilify (Aripiprazole) Products Liability Litigation, MDL 2734, was created in October 2016.  Almost two years later, the court entered an order requiring every plaintiff to complete a Supplemental Plaintiff Profile Form (“PPF”) and supporting documentation by October 31, 2018.  That order provided that failure to comply would result in sanctions, “up to and including dismissal of a case.”  In re Abilify, MDL 2734, Order, at p.1 (N.D. Fla. Jan. 31, 2019).  As of last week, “over 400 plaintiffs” had failed to submit a PPF or submitted an incomplete PPF.  Id. at p. 2.  So the court issued an order to show cause why these deficient plaintiffs should not be dismissed.  Plaintiffs were given one week to respond – and just submitting the PPF and supporting documents isn’t going to be enough.  Id.

So, how is this Lone Pine? It’s a matter of substance over form.  The court doesn’t call the PPF process Lone Pine, but if you look at what plaintiffs were being asked to do – it’s all there:

Proof of use:  Plaintiffs had to state whether they had records documenting use of the product.  If so, they had to produce them and if not, they had to explain why not.  Why not indeed.  No lawsuit should be filed without first obtaining proof of product usage.  Production of pharmacy/dispensation records should not be a hardship for any plaintiff 2 years into a litigation.

Proof of injury:  Plaintiffs had to state whether they had ever been diagnosed with their alleged injury.  If they were diagnosed, they had to produce the records confirming the diagnosis.  If they did not have such records, they had to produce a “physician certification attesting that you have been diagnosed with [your alleged injury] and that your symptoms began while on Abilify, and identifying all information and records on which the physician relied.”  In re Abilify, Order, MDL 2734, Dkt. 986-1 (N.D. Fla. Aug. 31, 2018).  Definitely Lone Pine territory.  If you claim you suffered your injury, you have to have proof.  Again, we think that’s something plaintiffs should have before they file suit, so it is completely reasonable to ask for it well after that point.

The PPF process is a common one in MDLs, but it has to have teeth and it has to have an enforcer.  If a PPF only requires plaintiffs to reiterate their allegations and not back them up with documentation, it really doesn’t do anything to weed out meritless claims.  Likewise, the court has to be willing to dismiss plaintiffs who don’t comply.  If you don’t do the work, you don’t get your case.  The next step is more difficult and one we wish more courts would take – diving into the ooze.  For the hundreds of plaintiffs who did complete the PPF, does the documentation support the allegation?  This starts to get too close to Daubert and summary judgment for many courts to feel comfortable, but from experience we know complete PPF/Lone Pine submissions are not the same as non-deficient submissions.  We also know assessing deficiencies is a lot of work.  Not fun work.  Not pretty work.  But the kind of work that brings order to chaos.  Lone Pine may just be to MDLs what a blast of cold air was to the The Blob.  It wasn’t dead, but at least it was stopped (“as long as the Arctic stays cold!”).

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

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

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

Here are two more recent examples of MDL dysfunction.

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

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

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

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

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

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

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

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

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

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

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

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

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

Id.

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

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

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

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

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

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

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

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

You can waive remand.  That’s Lexecon, Inc. v. Milberg Weiss Bershad Hynes & Lerach, 523 U.S. 26 (1998).  But, if you agree to remand, you’re going back whence you came.  So said the Judicial Panel on Multidistrict Litigation earlier this month in In re: Biomet M2A Magnum Hip Implant Products Liability Litigation, 2018 WL 6426830 (JPML Dec. 6, 2018).

That’s pretty much all the 4-paragraph opinion says on this issue of first impression.  The JPML cannot “redirect the remand” to a non-originating court.  What the opinion doesn’t tell is why the request was being made in the first place.  So, we did a little digging.  At issue were three cases selected for remand from this MDL.  The Chadwick case had been originally filed in state court in New Jersey and subsequently removed to federal court.  Plaintiffs included as a defendant a company whose sole role in relation to the device at issue was to supply raw materials.  That company, a New Jersey company, was the only thing establishing venue in New Jersey.  Memo. Of Law in Support of Motion of Defs. To Vacate Conditional Remand Order, No. TXS/4:14-cv-00232, Dkt. No. 12-1 (JPML), at 2-3.  Plaintiff is a resident of Wyoming and Biomet is an Indiana company.  The New Jersey defendant filed a motion to dismiss based on the immunity afforded raw material suppliers under the Biomaterials Access Assurance Act (“BAAA”).  Feels like the New Jersey company was present simply to allow some forum shopping by plaintiff.  Prior to remand, however, plaintiff agreed to dismiss the raw material supplier and with that dismissed the only link to New Jersey.  Id.

The second case, Carter, was filed in the Southern District of New York before being transferred to the MDL.    Plaintiff Carter, however, lived in Virginia and had surgeries in Virginia and North Carolina.  Her complaint does not include any allegation why venue would be appropriate in New York.  Id. at 3-4.  Similarly, the plaintiff in the Richards case filed suit in the Southern District of Texas, but she resides and had surgery in cities that fall in the Northern District of Texas.  Id. at 4.

At the time of remand, the MDL judge was willing to grant the parties’ request that these three cases be transferred to appropriate venues that were not their originating courts.  However, in the suggestion of remand, the judge concluded that he had no authority to grant the relief requested by the parties and listed the remand jurisdiction for each case as the original transferor courts.  Id. at 5.

Defendants argued that the logic of Lexecon should apply.  In effect, that there was no difference between waiving remand to the transferor court to allow trial to take place in the MDL and waiving remand to the transferor court to allow trial to take place in a different, but appropriate venue.  Id. at 6.  Defendants also made the points that denying the request now was simply inefficient because they would file change of venue motions post-remand that were highly likely to succeed and that at least as to New Jersey and New York there were also personal jurisdiction issues.  Residents of Wyoming and Virginia were suing Indiana companies in New Jersey and New York.  And that hasn’t been allowed since Daimler AG v. Bauman, 571 U.S. 117 (2014).

But the JPML was unpersuaded finding that the statute, 28 U.S.C. § 1407(a), afforded it “no discretion.”  The only remand destination allowed is the original transferor court, even if the parties agree that jurisdiction is improper.  In re: Biomet, at *1. 

So, other than this now being the rule of law, to us it is also indicative that Congress did not contemplate the current forum shopping practices.  Cases should be remanded from where they came because they should have been filed in appropriate jurisdictions from the outset.  But, we know that’s not the reality.  We are optimistic that the issue will be resolved correctly post-remand, but where venue is so clearly not present, we don’t see the harm in arming the JPML with the tools to get the job done.

Late last month Bexis attended the annual ACI Drug and Medical Device Conference in New York.  In between helping to lead the discussion in the pre-conference Defense Counsel War Room and speaking on 3D printing and product liability, Bexis picked up a couple of interesting ideas about dealing with problems concerning federal multi-district litigation (“MDL”) that he hadn’t heard before.  We’re passing them along.  Even if they don’t ultimately get anywhere, at least our readers will be aware of these possibilities.

The first idea relates to the currently pending examination of MDL practices by the federal Advisory Committee on Civil Rules.  One of several proposals under consideration is some sort of interlocutory appellate review of “important” MDL rulings.  This recurring problem was described in the latest Lawyers for Civil Justice submission to the Advisory Committee:

Certain issues − such as pre-emption, jurisdiction and Daubert on general causation − are key legal questions that affect large number of cases in an MDL proceeding.  However, appellate review of critical motions in MDL cases is very rare, occurring only when a trial results in judgment for the plaintiff.  As a result, a large number of cases that should not have been brought are allowed to proceed through a costly litigation process without appellate review.  In many MDL cases, the overall litigation is settled without ever receiving the benefit of a definitive ruling as to the legal validity of critical issues.

LCJ (9/14/18) Proposals for Discussion, at 4-5 (footnote omitted).

The realistic prospects for MDL interlocutory appeal, however, seem low, as district court judges have complained about both the delay and loss of discretion such review would entail.  The appellate judiciary has not yet engaged, but it is questionable that they would support something that would add to their workload.

The version of MDL interlocutory review floated at the ACI meeting was different in that it paralleled the existing Judicial Panel on Multi-District Litigation.  Rather than adding to the dockets of existing courts, the proposal was to create an Appellate Panel on Multi-District Litigation that could come to be seen as the same sort of plum assignment for the appellate bench that the JPML has become for district court judges.  The Appellate Panel could consist of one judge from each circuit, appointed by the Chief Justice of the United States, to a fixed term (5 to 7 years seems adequate).  The 12-member panel could sit in groups of three, as is current appellate practice.  Four three-judge panels should be sufficient to hear the limited number of interlocutory appeals that MDLs would generate.

Although the details would have to be spelled out, it is probably a good idea to require one of the judges on any panel to be from the circuit where the affected MDL is located.  Appellate Panel decisions would have precedential effect within the MDL system, but not beyond it, as current circuit court practice.  There could also be an en banc procedure to resolve conflicts or particularly important issues.

This idea is neither perfect nor fully formed, and would probably require action by Congress (which created the original JPML), but in several ways it seems superior to the current proposals, which are unloved by practically all of the judges, who would have to approve any system of interlocutory appeals.

The second proposal arises from the much discussed drawbacks of the current MDL system of “bellwether trials.”  While we remain of the opinion that the MDL statute does not confer authority on an MDL judge to try any case (even in the same state or judicial district), not routinely assigned to him/her in the normal process, that view has yet to prevail.  Thus, one of the recurrent frustrations – shared by both MDL judges and defense counsel – is plaintiffs gaming the system by dismissing any “bellwether” cases that they don’t want to try, even though they helped create the bellwether selection process in the first place.  As the same LCJ submission described this problem, “plaintiffs will often voluntarily dismiss proposed bellwethers that might prove adverse to them, thus skewing any sample towards greater recoveries than average.”  LCJ (9/14/18) Proposals for Discussion, at 6.

As long as a party has the absolute right to dismiss that party’s case, there is no way to prevent strategic bellwether dismissals.  The thought we heard expressed at the ACI conference was that it is possible to “hit them where it hurts” when such shenanigans happen.  In this instance that means sanctioning the dismissal of bellwethers by reducing the plaintiffs’ side common-benefit fund.  That could be accomplished in two ways, perhaps enforced in tandem.  First, the common-benefit fund could be reduced by a certain percentage (say, one tenth of one percent) for each previously agreed-upon bellwether case that is voluntarily dismissed prior to trial.  The second approach would be to reduce the common-benefit fund by the amounts actually expended by both sides preparing any dismissed bellwether case for trial, since those expenditures are no longer of “benefit” to anyone after a voluntary dismissal.  Some bookkeeping would be required, but keeping track of case-specific expenses is hardly a rare thing in litigation.

The ideas explained in this post are one of the reasons we enjoy going to conferences such as ACI or DRI.  Nobody has a monopoly on creative ideas, and the more people we can trade ideas with, the better off we all are.

J.P.M.L. Denies Request for New Gadolinium MDL

“Eventually, all things merge into one, and a river runs through it. The river was cut by the world’s great flood and runs over rocks from the basement of time. On some of the rocks are timeless raindrops. Under the rocks are the words, and some of the words are theirs. I am haunted by waters.”  Norman Maclean, “A River Runs Through It.”

Last weekend, we stood on the banks of the Flathead River, just outside of Glacier National Park.   We retreat to Montana, every now and then, when we need to restore our soul.  This we have in common with Maclean, for this is where he wrote his novel about fly-fishing and life, to the extent that there is a distinction between the two.  As we stood under the aptly-named “big sky,” with the river at our feet and the mountains in the distance, we felt tucked into our proper berth in the cosmos and all of the proportions felt right.

In the very short decision about which we report today, a group of plaintiff lawyers needed the J.P.M.L.’s smackdown to be relegated to their proper place in the jurisprudential universe.  In In re Linear Gadolinium-Based Contrast Agents Prods. Liab. Litig., 2018 WL 4905435 (J.P.M.L. Oct. 10, 2018), plaintiffs in seventeen gadolinium cases moved to centralize the suits in a new MDL. This would be the second MDL go-round for gadolinium.   You can read some of our posts about the first MDL here.

Gadolinium is a contrast agent.  Plaintiffs allege that it causes injury when it is retained in the body after it is used for radiological testing.  This time around, the plaintiffs argued that their suits should be centralized either in the Northern District of California or in the District of Massachusetts.   The defendants argued that the cases should not be consolidated, or, in the alternative, that the J.P.M.L. should stay its decision until general causation discovery was completed in actions pending in the District of Arizona.

The J.P.M.L. concluded that “centralization would not serve the convenience of the parties or further the just and efficient conduct of [the] litigation.”  Gadolinium, 2018 WL 4905435 at *1.  First, the Panel held that the plaintiffs had “failed to demonstrate that any common questions of fact and law [were] sufficiently complex or numerous to justify centralization.”  Id.  This was because several different product formulations, from different manufacturers, were involved, and the injuries “appear[ed] to be highly plaintiff-specific. . . .”  Id.  In addition, because most plaintiffs were represented by a single law firm or by other firms working with that firm, centralization was unnecessary.  As the Panel stated, “Given the significant overlap of plaintiffs’ counsel, alternatives to transfer exist that may minimize [the] possibilities . . . of duplicative discovery and/or inconsistent pretrial rulings.”  Id. at *2.  And then came the music to the ears of all of us who spend our professional lives watching plaintiffs abuse the MDL framework:  “. . . [C]entralization under Section 1407 should be the last solution after review of all other options.”  Id. (citations omitted).  Bexis tells us that this seems to be the first time the Panel has issued this admonition in the context of prescription medical product liability litigation.   We hope it’s not the last, and we’ll keep you posted.

In the meantime, thumb through “A River Runs Through It.”  It’s magic.  We promise.

It’s been a long road.  Well after product liability litigation over Accutane and inflammatory bowel disease (“IBD”) had been thoroughly debunked everywhere else in the nation, such litigation lived on in New Jersey – for year after interminable year.  First, a number of trials occurred, but literally every verdict for the plaintiffs was reversed on appeal.  Here are some of our posts on that phase of the litigation.  Then, once the trial court had had enough and began dismissing large numbers of cases, the intermediate appellate court reversed those decisions, too.  Here are some of our posts on that phase of the litigation.

Ultimately, it was up to the New Jersey Supreme Court to step in and figure everything out.  We blogged recently about it reversing the Appellate Division and entering a landmark decision on the admissibility of expert testimony in New Jersey.  See In re Accutane Litigation, ___ A.3d ___, 2018 WL 3636867 (N.J. Aug. 1, 2018).  Well, the defendant went back to the well on the adequacy of the drug’s warnings, and yesterday it rang the bell again.  In In re Accutane Litigation, ___ A.3d ___, 2018 WL 4761403, slip op. (N.J. Oct. 3, 2018), the court unanimously reversed the Appellate Division and affirmed the grant of summary judgment against another 532 cases brought mostly by litigation tourists.  “Of the 532 plaintiffs, 18 are New Jersey residents and 514 are residents of 44 other jurisdictions.”  Id. at *5.

The trial court had told the tourist plaintiffs that they were stuck with the consequences of choosing to descend on New Jersey like a plague of locusts – New Jersey law applied, including the presumption of adequacy that the state’s Product Liability Act (“PLA”) gives to FDA-approved warnings.  The warnings were adequate as a matter of law because “plaintiffs failed to overcome the presumption of adequacy.”  2018 WL 4761403 at *5.  The Appellate Division held that the law of each of the plaintiffs’ home states, 45 states altogether, governed, and reversed summary judgment under the laws of most of those states (all but eight).  Id.

Choice of Law

The New Jersey Supreme Court first said “you’ve got to be kidding” to the Appellate Division’s multifarious choice of law result.  The plaintiffs made their bed and thus had to sleep in it:

[W]e hold that New Jersey has the most significant interests, given the consolidation of the 532 cases for MCL [multi-county litigation] purposes. . . .  The aggregation of hundreds of cases under MCL allows the resolution of common issues of law.   A trial judge cannot be expected to gain a mastery of the law of forty-five different jurisdictions.  Construing New Jersey’s PLA is challenging enough.  New Jersey’s interest in consistent, fair, and reliable outcomes cannot be achieved by applying a diverse quilt of laws to so many cases that share common issues of fact.

Accutane, 2018 WL 4761403 at *6 (summarizing ruling).  See Id. at *15-20 (lengthy discussion of rationale for applying New Jersey law to all cases).

The court “proceed[ed] under the assumption” that true conflicts existed – that “application of New Jersey’s PLA may lead to an outcome different from the application of the laws of those other jurisdictions.”  Id. at *17 (citation and quotation marks omitted).  Even so, the most “significant relationship” for choice of law purposes in all cases was New Jersey.  First, as to alleged failures to warn, the corporation’s principal place of business “is where the alleged conduct causing the injury occurred − the manufacturing and labeling of [the product].”  Id. at *18 (citation and quotation marks omitted).

Second, in mass torts, “ordinary choice-of-law practices should yield in suits consolidating large numbers of claims and that courts should apply a single law in such cases.”  Id. at *17 (citation and quotation marks omitted).

The two most significant Restatement factors in this MCL matter are . . . “certainty, predictability and uniformity of result” and . . . “ease in the determination and application of the law to be applied”.  Applying a single standard to govern the adequacy of the label warnings in the 532 individual cases will ensure predictable and uniform results − rather than disparate outcomes among similarly situated plaintiffs.

Id. at *20 (discussing factors under Restatement (Second) of Conflict of Laws §6 (1971)).  Litigants cannot expect “[a] single judge . . . to gain a mastery of the laws of forty-five jurisdictions.”  Id.  If mass tort plaintiffs don’t want New Jersey law to apply they should “bring suit in the state where they reside.”  Id.  Under this new, mass-tort-specific application of choice of law, the plaintiffs in Accutane were stuck with New Jersey substantive law, which “is not as beneficial to their cause as the laws of other jurisdictions.”  Id.

We recommend that defense counsel study the court’s choice of law rationale.  It is no accident that, in its discussion of choice of law, the court cited Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017).  Accutane, 2018 WL 4761403 at *20.  Save for Delaware, more major pharmaceutical manufacturers are probably “at home” in New Jersey than anywhere else.  Thus, if the other side in the future chooses to congregate in New Jersey, they’ll have to put up with New Jersey substantive law, at least if the defendant makes motions in the aggregate.  Query, however, if the practicality rationale still applies in a single “bellwether” case where the alternative is application of one other state’s law, rather than the multi-state muddle the court faced in Accutane.  We think defendants have another opportunity to exercise some strategic discretion here.

Presumption of Adequacy

On the merits, the Supreme Court agreed with the trial court, that the defendant’s warnings were adequate as a matter of law under the PLA’s presumption of adequacy of FDA-approved labeling.  Initially, we get another shout out for the learned intermediary rule from the court:

[T]he PLA codifies what is commonly referred to as the learned intermediary doctrine – . . . that the physician acts as the intermediary between the manufacturer and the patient.  The prescribing physician − as a learned intermediary − generally is in the best position to advise the patient of the benefits and risks of taking a particular drug to treat a medical condition.  Under the learned intermediary doctrine, a pharmaceutical manufacturer generally discharges its duty to warn the ultimate user of prescription drugs by supplying physicians with information about the drug’s dangerous propensities.

Accutane, 2018 WL 4761403 at *21 (citations and quotation marks omitted).  We’re always on the lookout for high court reaffirmations of the learned intermediary rule.

As to the statutory presumption of the adequacy of FDA warnings, the court reached the right result, but not before a lengthy detour based on a questionable source (a law review article written by plaintiff-side professional expert David Kessler) and the infamous decision in Wyeth v. Levine, 555 U.S. 555 (2009).  2018 WL 4761403 at *21-24.  The upshot is a ruling on how the PLA’s “rebuttable” presumption of adequacy can be rebutted:

[T]he rebuttable presumption of adequacy attaching to an FDA-approved drug label is overcome when a plaintiff presents clear and convincing evidence that a manufacturer knew or should have known, based on newly acquired information, of a causal association between the use of the drug and “a clinically significant hazard” and that the manufacturer failed to update the label accordingly.

Id. at 26.  Notably, the substantive aspects of this rebuttal standard are based on federal regulations, including the notorious Levine “CBE regulation,” 21 C.F.R. §314.70.  This result leaves little daylight between the PLA presumption and implied preemption under Levine, except for the burden of proof.  Preemption is also based on “newly acquired information” – specifically the lack of it.  So any claim that would be preempted in other jurisdictions because plaintiffs can’t point to anything new that the FDA hadn’t already considered is independently barred in New Jersey by the PLA presumption.  However, while defendants bear the burden of proving preemption, in New Jersey the PLA presumption means that plaintiffs bear the burden of proving the presence of the necessary “new” information, and must do with clear and convincing evidence, which Accutane defined as “evidence so clear, direct, weighty in terms of quality, and convincing as to cause one to come to a clear conviction of the truth of the precise facts in issue.”  Id. at *26 (citation and quotation marks omitted).

The Accutane court added “one caveat” – regardless of anything else:

A manufacturer that acts in a reasonable and timely way to update its label warnings with the FDA, in accordance with its federal regulatory responsibilities, will receive the protection of the rebuttable presumption.

Id.

The Accutane court acknowledged that this “is a standard protective of responsible drug manufacturers.”  Id.

The PLA’s rebuttable presumption of adequacy that attaches to label warnings gives pharmaceutical companies the protection necessary to research and develop the drugs that will improve and extend the lives of people around the world.  The presumption of adequacy protects manufacturers from unmeritorious lawsuits.

Id.

Plaintiffs’ Failure of Proof

Finally, Accutane applied the law to the facts, and found that none of the 532 plaintiffs came close to overcoming the statutory presumption of adequate warnings.  “[M]ultiple warning tools,” the package insert, the patient package insert, the medication guide and “blister packaging,” all warned about the possibility of IBD.  Id. at *27.  “Association” was the proper description of the drug’s relationship to the plaintiffs’ injuries; “cause” would have been too strong.  Defendant “had reports that some patients, after taking [the drug], developed symptoms of IBD.  That one followed the other does not prove cause and effect.”  Id. (citing Accutane, 2018 WL 3636867, at *8-10).  Plaintiffs offered only “isolated examples” that had been “culled from the voluminous discovery.”  Id. at *27-28.  “To be sure,” that evidence “is not clear and convincing evidence that [defendant] knew or should have known that the use of the word ‘associated’ was inadequate.”  Id. at *28.

Nor is there any evidence that [defendant] avoided necessary label changes for economic reasons.  [Defendant’s] marketing personnel certainly expressed an interest in Accutane’s financial success; it would have been surprising if it were otherwise.  However, there is no evidence that [defendant’s] financial interest in Accutane’s success led it to withhold necessary IBD-related warnings.

Id.

*          *          *          *

This latest Accutane decision is a great result and should finally drive a stake through this vampire of a litigation.  Still, a couple aspects of this ruling give us pause.  As for choice of law, the application of multiple states’ laws was one means of defending against class actions, since doing so defeated both proportionality and manageability.  Many other reasons for rejecting class actions in personal injury litigation remain, but like practically everything else about choice of law, this could be a two-edged sword.  Second, the continued willingness of New Jersey courts to craft extra-statutory “exceptions” to the New Jersey legislature’s presumption of adequacy of FDA warnings bothers us doctrinally.  The statute says what it says, and we think that – as with all other statutory provisions (including preemption clauses) – courts should enforce statutes as written, and not use subsequent developments to change what the legislature did.  Short of a constitutional issue, courts should not encroach on the legislature’s prerogative to draft legislation.

We had occasion not long ago to reread closely Lexecon v. Milberg Weiss Bershad Hynes & Lerach, 523 U.S. 26 (1998), the Supreme Court decision that clipped the wings of transferee judges in multi-district (“MDL”) litigation by reminding them that the MDL statute, 28 U.S.C. §1407, conferred no authority to try cases.  Except for one justice on one section, Lexecon was unanimous.  While the result came as something of a shock to the MDL insider community, to the Supreme Court, Lexecon was not a hard case.

While the facts of Lexecon (more accurately, the procedural history, since the issue was wholly procedural) involved a MDL judge’s so-called “self-transfer” of a case originally filed in another state, it’s important to examine what the Lexecon court actually held.

First, the MDL statute “authorizes the Judicial Panel on Multidistrict Litigation to transfer civil actions with common issues of fact ‘to any district for coordinated or consolidated pretrial proceedings,’ but imposes a duty on the Panel to remand any such action to the original district ‘at or before the conclusion of such pretrial proceedings.’”  523 U.S. at 28.

Second, at the time the JPMDL had a rule that, despite the explicit language of the MDL statute of coordination being for “pretrial purposes,” allowed self-transfer for trial.  Id. at 32-33.  While appellee (which had won at trial – Lexecon is also a poster child for why the MDL system needs interlocutory appeals as of right, see id. at 31) tried to argue that rule as a basis for authority to self-transfer, the Supreme Court held that the JPMDL lacked authority to authorize by rule an action that was ultra vires under its organic statute.  The import of such arguments “is simply to ignore the necessary consequence of self-assignment by a transferee court: it conclusively thwarts the Panel’s capacity to obey the unconditional command of §1407(a).  Id. at 36 (emphasis added).  “[T]he statute places an obligation on the Panel to remand no later than the conclusion of pretrial proceedings in the transferee court, and no exercise in rulemaking can read that obligation out of the statute.”  Id. at 36-37.

Thus, once §1407 is used to transfer a case, not even a formal JPMDL rule can oust the statutory requirement to remand back to the original court at the end of coordinated pre-trial proceedings.  The Court was clearly in no mood to tolerate gamesmanship in derogation of express statutory language – not even by the JPMDL.

Third, appellees also argued that nothing in the MDL statute precluded the MDL judge from subsequently re-transferring an action to himself under the general transfer statute, 21 U.S.C. §1404.  523 U.S. at 34.  The Court relied on the restrictive, and mandatory, language of §1407 to deep-six that argument:

§1407 not only authorizes the Panel to transfer for coordinated or consolidated pretrial proceedings, but obligates the Panel to remand any pending case to its originating court when, at the latest, those pretrial proceedings have run their course.

“Each action so transferred shall be remanded by the panel at or before the conclusion of such pretrial proceedings to the district from which it was transferred unless it shall have been previously terminated.”  §1407(a) (proviso without application here omitted).

The Panel’s instruction comes in terms of the mandatory “shall,” which normally creates an obligation impervious to judicial discretion.

Id. at 34-35 (citation omitted) (emphasis added).  In short, there is only one place a case can go after being initially transferred pursuant to the MDL statute – back to the “originating court.”

Fourth, appellees argued that, once a self-transfer for trial occurred, the §1407 obligation to re-transfer the case to its original court magically vanished, “because the self-assignment ‘terminates’ the case insofar as its venue depends on §1407.”  Id. at 37. The Court was having none of that too-cute-by-a-half argument either:

The trouble with this creative argument, though, is that the statute manifests no such subtlety.  Section 1407(a) speaks not in terms of imbuing transferred actions with some new and distinctive venue character, but simply in terms of “civil actions” or “actions.”  It says that such an action, not its acquired personality, must be terminated before the Panel is excused from ordering remand.  The language is straightforward, and with a straightforward application ready to hand, statutory interpretation has no business getting metaphysical.

523 U.S. at 37 (emphasis added).

Last and least, appellees argued that because §1407 allowed one type of action (Clayton Act antitrust cases) to be transferred for trial as well as pretrial purposes, power was implicitly conferred to do the same for all MDL cases.  No dice.  That special exception actually cut the other way, because it “demonstrate[d] that Congress knew how to distinguish between trial assignments and pretrial proceedings in cases subject to §1407,” id. at 38 – and did not allow transfers for trial purposes to any other type of case.

Lexecon also examined the legislative history of §1407 (which is why Justice Scalia, the scourge of legislative history, did not join that section).  That history reinforced that §1404 general-purpose transfers were not available as long as the case involved was part of an MDL proceeding:

But the question is not whether a change of venue may be ordered in a case consolidated under §1407(a); on any view of §1407(a), if an order may be made under §1404(a), it may be made after remand of the case to the originating district court.  The relevant question for our purposes is whether a transferee court, and not a transferor court, may grant such a motion.

523 U.S. at 39 (footnote omitted) (emphasis added).  And even such a post-remand §1404 transfer would have to comply with general venue requirements.  Id. at 39 n.2. Among other things, as we pointed out here, that would require personal jurisdiction in the district where the MDL judge sat, which depending on where the MDL was situated, might not be the case.

Beyond that, §1407’s “legislative history tends to confirm that self-assignment is beyond the scope of the transferee court’s authority.”  Id. at 39.  “The bill does not, therefore, include the trial of cases in the consolidated proceedings.” Id. at 40 (quoting House Report at 3-4).

The Court concluded in Lexecon that the statute meant what it said, and that if trials in MDL actions were “desirable,” Congress would have to amend the MDL statute to allow them:

In sum, none of the arguments raised can unsettle the straightforward language imposing the Panel’s responsibility to remand, which bars recognizing any self-assignment power in a transferee court and consequently entails the invalidity of the Panel’s Rule. . . .  [Appellee] may or may not be correct that permitting transferee courts to make self-assignments would be more desirable than preserving a plaintiff’s choice of venue . . ., but the proper venue for resolving that issue remains the floor of Congress.

Id. at 40 (emphasis added).

We have engaged in this detailed exegesis on Lexecon as much to demonstrate what the Court didn’t say, as what it did.  What is absent from Lexecon’s absolutist reading of §1407 is any mention of state boundaries.  Rather the Lexecon court focused entirely on what was allowable in any MDL case initially transferred under §1407, whether that case was first filed in another state or not.

We think that’s critically important.  In their zeal to use the threat of trials to bludgeon defendants into settling, some MDL judges have relied upon territorial distinctions that are wholly absent from Lexecon itself.  They have sought to create a pool of “bellwether” trial cases from actions originally filed in the same state, or the same judicial district, as the MDL itself.

We think that this questionable practice could be the next Lexecon.  Frankly, we don’t think Lexecon allows that.

The basis for the Court’s unanimous holding in Lexecon is what the MDL statute “straightforward[ly]” requires – cases that come to the MDL through to §1407 remain subject to the statute’s absolute remand requirement.  There is no exception in Lexecon for trial (as opposed to remand) of cases transferred under §1407 from other district courts in the same state, or even from other judges in the same judicial district.  Unless the MDL judge happens to have received such a case through ordinary random assignment, s/he can’t try it – unless it’s first transferred out of the MDL and then retransferred back, if that is possible, under §1404.

No gimmicks allowed; the Court came down hard on gimmickry in derogation of §1407’s express limits in Lexecon.

And even if an MDL judge were able to cajole, or pressure, another judge to retransfer a case back to it for a “bellwether” trial, that case would no longer be part of the MDL.  MDL case management orders, MDL scheduling orders, MDL lead counsel (on both sides) would no longer be applicable – otherwise the transfer starts to look like another gimmick to get around the express limitations on allowable MDL activity that Congress wrote into the statute.  In particular, we don’t think that the plaintiff’s counsel in such a bellwether-after-retransfer trial can be compensated from MDL common benefit funds.  The MDL statute straightforwardly limits MDL proceedings to “pre-trial.”

Along these lines, the Lawyers for Civil Justice has a proposal to condition the conduct of “bellwether” trials in MDLs upon the voluntary – and confidential – consent of all parties.  That’s what prompted us to reread Lexecon in the first place.  Since a voluntary consent/waiver appears to be the only way to conduct MDL trials (whether called “bellwether” or anything else) consistently with what Lexecon actually held, we recommend that proposal as a possible way to avoid the next Lexecon.

Otherwise we wouldn’t be surprised to see the Supreme Court, when presented with the opportunity, to make MDL “bellwether” trials go the way of the dinosaurs.

So you’re sitting next to one of your client’s senior executives. You’re at a large table in a larger conference room. There’s a lawyer for every seat at the table. There’s a court reporter in the room. A videographer too. The lawyer across the table from you slides a document to your client and gives you a copy. And then she starts asking questions. You look at the document. It dawns on you. This is a privileged document. It’s an email attaching a power point that was used in a presentation by your client’s legal department to its employees. The videotape is rolling. The court reporter is typing. Uh-oh. Bad thing.

What to do? Well, whatever you do, don’t panic. It’s not over. You probably have a chance to fix this, to claw it back. And, if you do it right—which in part involves speaking up—and you’ve done the preparation, the court will likely back you.

This precise predicament happened to the defendant in In re Abilify (Aripiprazole) Prods. Liab. Litig., 2018 WL 44440707 (N.D. Fla. Sept. 17, 2018). Bristol-Myer Squibb’s lawyer objected to a plaintiffs’ attorney’s use of a document at a deposition, asserting that it was privileged and had been inadvertently produced. The BMS lawyer sent a follow-up email that night further asserting the privilege. Three business days later, the lawyer sent another written notification, this time accompanied by a privilege log. As it turned out, taken together, these actions weren’t perfect. But they were enough.

The plaintiffs filed a motion asking the court to confirm that the documents should remain produced material. They argued that (1) the defendant did not follow the claw-back procedure set out in a protective order addressing inadvertent disclosures and (2) regardless, the document was not privileged. Neither argument won.

For their procedural argument, the plaintiffs pointed to the protective order’s requirement that the defendant provide the plaintiffs with written notification of the claw-back and an accompanying privilege log within two business days of the deposition, not three. The court agreed that the protective order required this. But the court found it more important that the BMS lawyer gave a detailed verbal notice of the privilege assertion at the deposition and followed-up that evening with a detailed email confirming it. In other words, speaking up quickly and clearly helped. Preparation helped to—that is, already having a protective order on inadvertent disclosures in place. The court held that the defendant’s clarity in immediately clawing the document back and stating the reasons won out over missing the two-day deadline by one day. Substance over form:

Although BMS might not have followed the precise terms of the Protective Order, in the Court’s view the one-day delay in sending the privilege log can charitably be described as a situation where the expression “no harm, no foul” applies. Plaintiffs cannot point to any prejudice they suffered or could have suffered as a result of the receipt of a privilege log one day late, which simply confirmed the privilege timely raised by BMS at the deposition and then confirmed in writing the same day. Consequently, Plaintiffs’ argument that BMS waived its ability to claw back the email and PowerPoint is due to be denied.

Id. at *2.

Plaintiffs argued that the power point wasn’t privileged because a non-lawyer assisted in preparing it and, regardless, it conveyed publicly known facts about a corporate integrity agreement (“CIA”). This argument lost too.

It did not matter that a non-lawyer assisted in preparing the power point. What mattered was that the power point’s content came from an attorney using it to advise a client:

While the final preparation of the PowerPoint slide deck may have been created by a paralegal or non-attorney, the information does not lose its privileged nature simply because the attorney did not perform the ministerial function of actually preparing the PowerPoint deck. Thus, the fact that the meta data reflects the deck was prepared by a non-attorney has little relevance to whether the PowerPoint is protected by the attorney-client privilege.

Id.

And the fact that the power point addressed a publicly available CIA didn’t destroy its privileged nature either. It contained counsel’s interpretation of the CIA and the obligations that it placed on defendants, and it was used in counsel’s presentation to senior management on those issues:

BMS not only asserts that the redacted portions of the PowerPoint dealing with the CIA were prepared by in-house counsel but importantly that the PowerPoint was part of a presentation by Regina Cavaliere, a Senior BMS counsel, made to BMS management employees. According to BMS, Ms. Cavaliere’s presentation was not simply a historical account of the CIA but instead was Ms. Cavaliere’s interpretation of the scope of BMS’ obligation under the CIA. The redacted portions of the PowerPoint specifically related to the presentation, which provided BMS employees with both factual background to the CIA and BMS counsel’s interpretation of BMS’ obligations under the CIA. The information in the slides in the PowerPoint therefore must be viewed in the context for which the slides were prepared and how the slides were used by BMS’ in-house counsel in her presentation.

Id. at *3. The court ordered that the email and attached power point were privileged and had been inadvertently disclosed.

Phew. Bad thing averted. So, if you’re at a deposition and your opposition hands a privileged document to your witness, ignore that shiver going down your spine. Just go to work, speak up and follow up.

Over 11 years ago the blog published a post called “Anatomy of a Mass Tort,” which endeavored to explain the life cycle of this type of litigation.  We’ve decided to revisit and update that post, given the changes that have taken place over the intervening years.

And change it has.   Our original post mentioned class actions several times. It didn’t mention personal jurisdiction, multi-plaintiff complaints, third-party litigation funding, or plaintiff fact sheets.

So here is anatomy of a mass tort 2.0.

*********

Today, we’re stepping back.  Instead of analyzing specific doctrines or new cases, we’re going to give you a run down of the whole enchilada:  a mass tort, start to finish.

With a mass tort, the entire process can be described without ever typing these words:  “the product was defective” or “someone was hurt.”  Unfortunately, those words have become unnecessary to describe the anatomy of a mass tort.

A mass tort hardly needs a trigger anymore.  At bottom, all that’s necessary is a drug or device with a decent sized market and something to attract the other side’s lawyers.  Look, for example, at the best-selling drugs of 2007, when we first wrote the post. They include Lipitor, Nexium, Plavix, Seroquel, and more.  Of the top 20, just looking at the names, 15 of them resulted in easily recognizable mass torts.  Unless you’re inclined to believe that the FDA erroneously approves drugs three quarters of the time, then it’s pretty clear that all that’s really essential to a mass tort is “mass.”

Still there is usually some sort of trigger.  A number of events can set off the avalanche.

First, the most significant would be adverse regulatory action – a mandatory recall or a label change adding a boxed warning or a significant new risk.  Mass torts commonly follow in the wake of regulatory action; the idea that they somehow induce regulatory action is plaintiff-side propaganda 95% of the time.

Second, even in the absence of regulatory action, plaintiffs try to stir up trouble.  Thus, they try to generate bad press – something nasty said on 60 Minutes, or a similar program will rev up the clanking machinery of the litigation industry.  In Bone Screw it was David Kessler’s hysterical response on “20/20” to off-label, yet standard of care, spinal surgery.

Third, short of that, a voluntary recall, even though no government agency demanded it, whereby a manufacturer took its product off the market, has also led to mass tort action.  That was one of the things that happened with Vioxx.

Fourth, a significant verdict in what was once a one-off case can provide the necessary spark − nothing catches the eye of the plaintiff’s’ bar like big money.

Fifth, although it may be as much of an excuse as a true cause, a critical article in the scientific literature can prompt the other side to do its thing. That’s what happened with hormone therapy – a much anticipated scientific article didn’t show the expected advantages, but rather a moderate increased risk (less than double) as to a single (the highest) age group that wasn’t even the principal target population for that product.  In the mass-tort frenzy that followed, all these distinctions got lost in the shuffle. Since tort “market” was large, and the risk relatively common, it was off to the races and damn the details.

Finally, these days the trigger doesn’t even have to involve the product.  An adverse event befalling another product in the same group of drugs or devices can lead to copycat mass tort litigation against the entire group.  Plaintiffs are currently suing over every second generation anticoagulant, every IVC filter, and every conceivable kind of surgical mesh. Think Vioxx and Cox II analgesics, or Baycol and statins, or AcroMed’s pedicle screw device, with litigation spreading to every other device on the market that used similar bone screws.  Close used to count only in horse shoes, hand grenades, and H-bombs − you can add mass torts to that list, particularly if you can find a synonym beginning with “h.”  (We can think of one easily enough, but the Blog, unlike ATRA, isn’t allowed to use it.)

How much (if any) of this is really good policy?  We have to think that the litigenic effects of FDA regulatory action, and of all recalls, mandatory or voluntary, cannot help but to deter actions that proper public health policy should encourage.  We’re afraid that fear of litigation may deter companies from voluntarily undertaking (or acquiescing in a regulatory agency’s request for) a product recall or a label change.  That doesn’t mean we agree with it, though, since delay in such situations usually makes things worse in the end.

Back when product liability was shiny and new, strict liability was justified because it supposedly would causes companies to internalize risks and thereby reduce those risks. These days fear of mass tort litigation can also influence corporate decision-making, in ways that are harmful to the public.

But we digress.  Back to our anatomy lesson.

Regardless of what is the triggering event, the creation of the mass tort itself follows – almost entirely extra-legally.

Advertisements.

Since the courts discovered that lawyers have a constitutional right to use advertisements to solicit clients, they have done so – with a frequency that would no doubt have shocked the Founding Fathers.  Anybody who watches TV knows what we’re talking about.

And it’s not just lawyers, either.  Media specialists and third-party litigation funders also combine to run (with apologies to Marlowe) the race that launched 100,000 TV (and internet) ads.  Anyone who responds – and many do – becomes “inventory,” their claims available for sale in bulk to enterprising lawyers hoping to cash in on the next mass tort.

Thus, within hours after the triggering event, “law firm” websites will invite product users to sign on as potential clients.  Similar solicits in other forms of media follow.

This early stage is usually the point of no return.  The lawyers involved will freely buy, sell, and trade the would-be clients that have signed up – to the point where those clients often don’t know who their lawyers actually are.  But once they have clients, no matter how attenuated the relationship, lawyers cannot ethically let them go.  Regardless of the facts, the mass-tort litigation process takes on a life of its own.

So, counsel who specialize in representing plaintiffs in mass torts strike first in their favorite venues.  Some of these are in state court.  There, they try to keep their chosen courts by filing multi-plaintiff complaints – in numbers less than 100 to avoid a federal statute called “CAFA” – with people from all over the country, but at least one in the home state of at least one defendant to prevent defendants from being able to take the cases to federal court.

The only thing the plaintiffs in these massive complaints have in common is that they claim some injury from the same product (although sometimes they sue multiple manufacturers of the same kind of product).  The only thing the complaint tells the defendant about the plaintiffs is their state of residence.  Try filing an adverse event report (which the FDA requires for every litigation complaint no matter how weak) with that.

Defendants counter with “snap” removals.  If the only thing preventing removal of a case to federal court is a defendant from the place where the plaintiff chose to file suit, then removal before service is a good idea for defendants.  Monitoring the state-court dockets and taking action before the plaintiff gets around to serving that defendant gets such cases to federal court. The statute allows it, and so do a lot of courts.

Other plaintiffs want to be in federal court so they can create multi-district (“MDL”) litigation.  Even in federal court – heck, especially in federal court – the race is also on.  The big money in MDL litigation, for those lawyers who want to work, is to be on the Plaintiffs’ Steering Committee.  That requires knowledge of the obscure ins and outs of MDL procedure, but it also requires a client base.  So candidates for the steering committee work in league with the media solicitors to scoop up lots of inventory to file in federal courts that they think would make a good home for an MDL proceeding.  These are usually the most competent plaintiffs’ lawyers. They’re itching to do some work, to try some cases, and to maintain or to establish their reputations in the field.

The final decision on where an MDL is located rests with a committee of judges, and competing lawyers will file lots of cases in various places (usually their home federal courts).  Defendants also have some say, and often prefer to be where their principal place of business is located.  Where an MDL is located can be important for other reasons besides the composition of the plaintiffs’ steering committee.  Federal issues, like preemption, differ between the circuits, and in MDLs the law of the circuit where the MDL is located will apply.

At this point, our original post mentioned class actions.  They’re really not many of them in mass torts anymore – practically none in cases alleging personal injury.  Class actions still get filed in mass torts, mostly on behalf of insurance or government programs that supply drugs, but as our cheat sheets show, they are rarely certified and nowadays are the “tail” rather than the “dog” in mass torts.

These MDL specialist plaintiffs’ lawyers are very good at what they do, but because the written rules don’t apply, and the rules that do are esoteric and hidden, it’s mostly the same repeat players over and over again. That the resulting steering committees tend to be less diverse than the current crop of White House interns is an unfortunate consequence of the overall lack of rules and reliance on a good old boys network rather than the stringent competition conducted by our clients  Our clients actually care about this kind of thing, and unlike the inventory on the other side, our clients get to choose their lawyers, rather than vice versa.

But we digress again.

Most plaintiffs’ lawyers in mass torts, however, do not seek leadership positions, because that would require, well, work.  It’s far easier to collect some inventory from the advertisers, throw them in the judicial hopper, do nothing, watch how the litigation plays out, and then spring into action only after the parties announce a global settlement.  No muss; no fuss; just big bucks.

MDLs are perfect for these lawyers.  The federal rules largely don’t apply – at least to plaintiffs.  Defendants are precluded from challenging the adequacy of complaints that don’t contain basic information like whether the plaintiff actually used the product at issue or had the injury that is the subject of the MDL.  Defendants aren’t allowed to take so-called “case specific” discovery or to file “case-specific” motions.  With the rules becoming figments of the imagination, at most defendants get “fact sheets,” most of which contain incomplete or even downright false information.

So while defendants are spending tens of millions of dollars complying with the plaintiffs’ massive discovery (a mass tort largely eliminates “proportionality” from discovery directed at our clients), if they want any discovery at all from plaintiffs – they have to pay for that, too.  Defendants have to pay to check the accuracy of the fact sheets, and to collect the plaintiffs’ medical records.  Since this is information that, in non-mass-tort cases, plaintiffs would pay for in responding to discovery, it’s tailor-made for those plaintiffs’ attorneys who want a free ride until settlement.

And that’s just the core litigation.  Mass torts also spawn peripheral litigation. The target company (or industry) will probably be enmeshed in securities litigation, with shareholders seeking “stock drop” damages and alleging that the company knew all about what the product liability plaintiffs are suing over, but kept it hidden from investors.  If the company has insurance, the insurers will bail and seek to deny coverage.  State attorneys general, or even the federal government, might sue.  There could even be the odd False Claims Act case, or two.

It’s the American legal system in all its glory.  Mass torts are essentially a lawyer’s full employment act.  Mass torts are even counter-cyclical – they tend to rise when the economy doesn’t; when more people need money and more investors have underinvested funds lying around to underwrite litigation.

In any event, the mass tort proceeds.  Plaintiffs petition the MDL Panel to create a coordinated proceeding.  That gets sent somewhere, with or without the defendant’s acquiescence.  A significant number of MDL judges are also repeat players.  We’re sure that at least some of them enjoy the power and the notoriety – in addition to the relatively interesting work.

Non-MDL actions also proceed, to the extent that plaintiffs who want to be in state court are successful in staying there.  Personal jurisdiction developments are making this harder, as federal courts are less likely to tolerate the multi-plaintiff complaint jurisdictional dodge.  Several states are known for coordinated state-court mass tort proceedings, such as California, Pennsylvania, New Jersey, Missouri, and in some types of mass torts, New York, and Florida.

In the MDL proceeding, the target defendants search for a silver-bullet defense – one that can get rid of thousands of cases at once.  These are mostly preemption and Daubert expert witness exclusion, although occasionally other issues, such as warning adequacy as a matter of law, innovator liability, or even the statute of limitations, can serve that function in particular mass torts.  Preemption bars plaintiffs from recovering because federal law says “no.” It doesn’t matter how strong or weak a plaintiff’s state-law tort claim is on the merits.  A win on the (general causation) Daubert ground means that plaintiffs are barred from recovery because no legitimate scientific evidence links the defendant’s product to the plaintiffs’ alleged injury.  These are the kind of rulings that, when they happen, often wind up on our annual “best of” list.

In all-too-many mass torts, the defendant loses on the wholesale level, preemption doesn’t apply and at least one plaintiff-side causation expert gets through Daubert.  So the litigation continues.  The next bump comes just before the two-year mark. That is the statute of limitations for product liability claims in most states.  Plaintiffs’ lawyers who have been holding back cases, trying to determine whether the federal or state litigation will provide them the most recovery with the least work, have to fish or cut bait. If they don’t file complaints then, well, the strongest legal malpractice claims involve blown statutes of limitations.  So at two years, the rest of the inventory shows up.

At the two-year point defendants at last have a pretty good idea of the magnitude of the mass tort.  And, with most new cases time-barred, defendants can begin to think about what a global settlement might look like, now that news of settlement negotiations won’t just spark another round of advertising and still more litigation.  Defendants’ depressed stock prices may start to rebound.

But even now the tricks continue.  Litigation shifts to states with longer statutes of limitations, more lenient discovery rules, and no borrowing statutes.  New Jersey comes to mind.  Fights over conflict of laws arise.  Litigation tourists go to states where they think such arguments might win.  Defendants respond with personal jurisdiction challenges to cases filed in states where neither they nor the plaintiffs actually reside.  More side issues to keep lawyers busy.

Then what?  Maybe the parties try a few “bellwether” cases.  Here, plaintiffs open their bag of tricks wide.  MDL judges all-too-often view everything through the prism of settlement, and anything that puts pressure on defendants to fork over big bucks will be employed by at least some of them.  Repeat player MDL judges – especially lately – seem to get picked because they have a good settlement track record.  Settling judges tend to be what mass-tort plaintiffs like, and therefore these plaintiffs have forum shopped to get MDLs before them. It’s all about settlement leverage.  Settling MDL judges will routinely deny preemption, even where it’s widely recognized, look kindly on new and expansive causes of action, allow plaintiffs to manipulate the bellwether selection process so that only plaintiffs’ best cases get tried, make horrendous evidentiary rulings, and force defendants to try cases with multiple plaintiffs at the same time.

In most of these situations, if the defendant wins – presto – that’s a final judgment and the plaintiffs have an immediate right to appellate review.  If the plaintiffs win, well turnabout certainly isn’t fair play.  There’s no final order and no appeal.  Interlocutory appeals?  Rarer than hen’s teeth.  Why would an MDL judge pushing settlement do that?  In this one-way system, the only way a defendant ever gets to appeal a loss, is after losing a bellwether trial.  In that situation the appellate court has a Hobson’s choice, find a way to affirm or let “years of MDL time and effort go to waste.”

The actual safety of the product is largely irrelevant.  That the FDA reviewed the product and allowed it to be marketed is – if the plaintiffs have anything to say about it – is equally irrelevant. Plaintiff’s counsel, employing reptile litigation tactics, tells the jury in opening statement to, “Send a message to this company that put profits before safety!” or the other favorite, “This is the case of a company that stuck its head in the sand and refused to admit the truth!” Or perhaps. “In this case the defendant tried to hornswoggle the FDA.”  And it goes downhill from there.

Defense counsel responds:  “This is the case of Joe Blow, who:

Saw a doctor who knew everything about the risk at issue, and who didn’t need a warning to decide what to do.

Has expert witnesses who are liars and will say anything for money.

Didn’t [read][follow] the warnings.

Had so many prior risk factors that the injury was waiting to happen.

Recklessly misused the product, which was obtained illegally in any event.

Since we haven’t identified any particular product, we can’t be more specific about how a trial would look, so we picked a few of both sides’ greatest hits.   The jury – between six and twelve people from which any anybody with any relevant scientific background has been excluded − hears from (among many possibilities) neurosurgeons, epidemiologists, pharmacologists, pathologists, biostatisticians, and bioethicists.  Then the jury decides the critical issue:   Who is worse?  The evil defendant or the reckless plaintiff?

Then we start counting.  If the defendant wins most of the trials, the mass tort loses its value, the plaintiffs’ attorneys would rather litigate something else, and one way or another the mass tort goes away with a whimper rather than a bang.  If the plaintiffs ring the bell – often assisted by a punitive damages claim or a consolidation of multiple plaintiffs − the litigation continues for a while, until those awards are overturned on appeal (see Vioxx and testosterone, and we hope Pinnacle Hip) or the risk becomes too extreme for the defendant to continue (see Actos).

Eventually, everyone’s exhausted.  Counsel wrestle with inventories and the aggregate settlement rule, or perhaps cy pres and some sort of settlement class action that even more blatantly favors the plaintiffs’ lawyers over their clients than other forms of mass-tort settlements.  The steering committee gets paid for all the work it supposedly did on all plaintiffs’ behalf, even though they’re free to screw any plaintiffs that don’t settle − since they only owe fiduciary duties to their own clients.

Finally, everyone goes home and tries to figure what else to do for the first time in five years.  So they turn on the tube looking for bad news that’s good for them, or start googling product recalls.

Then the whole thing starts over again.

 

It has been said, with maybe a bit of sarcasm, that a company developing a drug hopes that its drug will become successful enough to attract frivolous lawsuits.  OK, so maybe only outside lawyers have offered such an aphorism, but bear with us.  Imagine that a drug is developed to treat a really common condition, like high cholesterol, it becomes accepted as a first-line treatment, and becomes one of the most widely used prescription drugs of the last few decades.  Imagine then that the patient population that would take this drug has lots of co-morbidities and that, while the drug is being used on a long-term basis, some predictable portion of the drug’s users will develop a new condition, like diabetes.  Imagine then that, because the drug has been widely used for so long, there are lots of studies, published and unpublished, that look at measures like blood glucose and new diagnosis of diabetes, among many other things.  It should not be hard to imagine that thousands of the patients taking the drug would develop diabetes on the drug in the absence of any relationship and that plaintiff lawyers would round many of them up to sue based on the expectation that the lawyers and their favorite experts could gin up proof of causation that would survive a Daubert challenge if the manufacture did not pay to get rid of the litigation first.  This is hardly fancy as we have posted on multiple orders from Lipitor MDL (here, here, and here) that excluded plaintiffs’ causation experts and then granted summary judgment for the manufacturer across the board.

Much like the Zoloft MDL affirmance we lauded last year, all of this went up on appeal to either revive or affirm the end of an entire litigation.  We are pleased to say that In re Lipitor (Atorvastatin Calcium) Mkt’g, Sales Pracs. & Prods. Liab. Litig. (No. II), MDL No. 2502, — F.3d —, 2018 WL 2927629 (3d Cir. June 12, 2018), did the latter.  Without repeating the history of all of the decisions below that we detailed previously, there were five basic issues on appeal, the admissibility of each of the three experts plaintiffs offered, whether plaintiffs could use other evidence to establish causation without experts, and whether plaintiffs’ responses to show cause orders were sufficient to avoid summary judgment.  Each deserves some attention.

Plaintiffs’ statistician was up first.  His approach was to re-analyze clinical trial data to suggest that there was an increase in blood glucose levels and infer that as proof of causation for diabetes.  The disconnect here is fairly obvious, but the statistician compounded the problem by including both patients with a single instances of elevated glucose levels during the trials and patients with elevated glucose levels before the study began. Id. at *4.  Plaintiffs, their statistician, and other experts had agreed that a single increased glucose level did not indicate diabetes. Id. The statistician also agreed, as the MDL court put it, that he “lacked the expertise to opine about any implications that single glucose readings might have about the possibility of new-onset diabetes.” Id. This might have been enough to exclude his opinions, but he also relied on one test of statistical significance after the standard test failed and presented calculations of average blood glucose increases in a misleading and result-driven fashion. Id. at **5-6.  He also re-analyzed a study that had found no increased in the rate of diabetes with the drug compared to placebo based on a applying a new definition of diabetes after the fact and by someone who lacked relevant expertise. Id. at **6-8.  The Fourth Circuit affirmed the exclusion of his opinion, noting that the MDL court “properly discharged its gatekeeping duty” by weighing “classic concerns regarding reliability and relevance.” Id. at *6.

Plaintiffs also offered an internist to interpret the medical literature and perform meta-analysis of select studies, which he attempted to dress up with a purported application of the Bradford Hill criteria.  Noting the importance of dose to these analyses, the MDL court asked the internist to provide an analysis specific to each commercially available dose of the drug.  The MDL court ultimately excluded his causation opinion as to all but the highest dose because he acknowledged there was not a statistically significant increased risk of diabetes for the other doses. Id. at *9.  On appeal, plaintiffs challenged that their internist could not just lump all the doses together and offer a single causation opinion.  Given the facts here—like a 10 mg low dose, a 80 mg high dose, and studies specific to each dose—we do not think this requirement should have been the least bit controversial.  The Fourth Circuit, however, while holding that the MDL court did not “abuse its discretion in asking the expert to produce a dose-by-dose analysis,” cautioned that this was not a new requirement for all cases. Id. at *10.  The more serious, and recurring, issue was whether statistical significance was required for a causation opinion based on epidemiologic evidence and the Bradford Hill criteria.  Again, we think the Fourth Circuit could have gone a little farther—like you always or almost always need epidemiologic evidence as a starting point for causation in a product liability case and epidemiologic evidence must be statistically significant (with multiple studies with an increased risk greater than 2.0) to count—but its conclusion that the MDL court had not abused its discretion on the record here was good enough.  Specifically, the internist’s purported application of the Bradford Hill criteria and failure to establish that reliance on non-statistically significant results was accepted by epidemiologists were enough for the court to find his causation opinions unreliable. Id. at *12.

Plaintiffs also offered another internist to opine on specific causation for one of the bellwether plaintiffs.  While the plaintiffs touted that this expert had used a differential diagnosis to come to her opinion, the expert herself did not say that she did and claimed to use a methodology for her opinion in litigation that she had never used in her own practice. Id. at *13.  She also could not rule out other causes like the plaintiff’s weight and weight gain and relied too heavily on the post hoc ergo prompter hac fallacy. Id. at *15.  Again, this exclusion was within the MDL judge’s discretion.

Like the MDL court, the Fourth Circuit did not a bright line rule on whether general medical causation for product liability cases involving a pharmaceutical could ever be established without any expert testimony from the plaintiff.  We think the better approach, as spelled out in some state’s law, is to require expert testimony on these issues.  However, the Fourth Circuit’s conclusion that the specific non-expert evidence offered by plaintiffs—principally snippets from U.S. and foreign labeling—was not enough to establish causation is fine by us.  The causation issues are “complex and manifold” and the non-expert evidence from plaintiffs “isn’t especially strong.” Id. at *17 (contraction in the original).  So, the bottom line was more than fine by us:  “To hand to the jury the evidence here and ask it to reach a conclusion as to causation with any amount of certainty would be farcical and would likely result in a verdict steeped in speculation.” Id. Put another way, if a court is supposed to be the gatekeeper for expert evidence on key issues, it cannot just allow dubious non-expert evidence to suffice on an issue that would require an expert under Rule 702.

The last issue for the Fourth Circuit to address was whether the MDL court could require the remaining plaintiffs to come forward with evidence showing they could prove specific causation after the Daubert and summary judgment orders.  Plaintiffs’ argument on this was essentially that the MDL should have remanded all the cases rather than fulfilling the mission of the MDL court to decide common pretrial issues.  This argument was a bit disingenuous, because the plaintiffs surely would have been comfortable with summary judgment or Daubert motions being denied across the board had the rulings on the bellwether cases gone their way.  “Here, it was the district court’s prerogative to determine whether it could dispose of the cases before it on the merits.” Id. at *18.  We may not always be a fan of the direction MDL courts have taken in the last decade or so, but they are supposed to do what the MDL court did here.  At the end of the day, this MDL court “discharged [its] duties meticulously and thoughtfully” an ended a litigation as it should have been – with the manufacturer winning without facing the uncertainty of jury trials or succumbing to the pressure of a large number of pending cases.