Multidistrict Litigation

Bexis has lots of opinions on what’s wrong with mass-tort (especially drug/device) MDLs.  Heck, Bexis has even proposed amendments to the MDL statutes to correct the many severe problems that exist.  Now, Congress has before it possible statutory changes (not holding our breath) and Civil Rules Committee is looking into the same problems.  Maybe something will happen, although rules changes are notoriously protracted, and the cadre of MDL judges (15 judges control 18 MDLs that account for some 47% of the entire federal civil docket) and their plaintiff-side enablers will fight any attempts to curb MDL discretionary excesses.

In the midst of all this, the Duke Law School’s ongoing MDL best practices project held an invitation-only meeting recently, and Bexis was invited as one of the defense-oriented participants. This meeting was conducted under so-called “Chatham House” rules that preclude attributing particular statements to particular persons, so this post summarizing the meeting will not be of the “he said, she said” variety.

Early Dismissal of Meritless Cases

Defense-side participants produced a plethora of statistics that, in MDL after MDL, anywhere between 20% and 45% (eliminating outliers both ways) of all filed MDL cases are ultimately dismissed because the plaintiffs do not have evidence of the most basic information imaginable:  (a) that they actually encountered the product of the defendant being sued; (b) that they suffered one of the injuries that the MDL was about; and (c) that that the timing and amount of the plaintiff’s exposure was plausible under the plaintiffs’ own causation theories.  The missing information that was discussed was not anything expert-related, just product identification, injury, and plaintiffs fitting within whatever might be the plaintiffs’ own asserted parameters of causation.

Somewhat surprisingly, the plaintiff-side participants did not dispute the basic point – that meritless plaintiffs are widespread, running into the thousands of bogus plaintiffs in the larger MDLs.  Indeed, most of the plaintiff-side speakers professed not just their recognition of the meritless claim problem, but their own annoyance at this phenomenon.  The presence of large numbers of meritless cases artificially skewed who had what say on plaintiff steering committees, which partially depend on numbers of cases.  At the back end, meritless cases produced a bunch of left-over plaintiffs, abandoned by their counsel (who never intended to try cases), bumbling around pro se.

Not one plaintiff-side speaker denied that numerous meritless cases existed in MDLs, or that the absence of effective Rule 8/12/TwIqbal procedures encouraged meritless filings.  Evidently, the “park and ride” plaintiff-side lawyers who pump and dump cases into MDLs don’t attend conferences like this, or if they do, they keep quiet.  At most, the plaintiff-side speakers tolerated bad cases because they would “all work out in the end.”

The defense side vehemently rejected that no-harm, no-foul approach.  Defense participants argued that meritless cases weren’t harmless, but rather skewed MDL litigation from beginning to end – driving up discovery costs, forcing defendants to vet cases that plaintiffs should have done before filing, complicating random plaintiff selection for bellwether trials (more about such trials, below), and inflating settlement demands.  Artificially inflated plaintiff numbers increase the psychological impact of MDLs, given how those numbers find their way into press descriptions and plaintiff solicitations.  Masses of bogus plaintiffs also prevent proper resolution of “proportionality” issues in discovery, since they inflate P-side discovery arguments.

Further, FDA regulations do not contain any “bogus” case exception that would give defendants leeway not to report such cases in their adverse event filings.  Phony cases lead to phony “signals,” since even though adverse event reporting is (according to the FDA) not supposed to establish causation, plaintiff-side experts routinely try to misuse them − and sometimes get away with doing so.  When that happens, it’s garbage in, garbage out.  Inflated plaintiff numbers lead directly to inflated reports, so that meritless cases end up supporting junk science.  This effect is magnified by pleading that would be barred by TwIqbal in non-MDL cases that, such as use of “and/or,” that purport to sue multiple defendants when they could only have used one product, so that each defendant is obligated to report the “adverse event” to the FDA.

Matters livened up a bit further, with that morning’s report from 360 on the extreme position taken by plaintiffs in the Zofran MDL were taking on discovery – that discovery rules in MDLs only apply to defendants.  They were demanding that only 8 of over 400 plaintiffs should submit to any discovery at all – giving bogus Zofran cases a free ride all the way to remand.  The Zofran plaintiffs were so over the top that they even claimed an MDL judge lacked jurisdiction to order discovery.  That’s what Joe Biden would call “malarkey,” and not a single plaintiff-side speaker defended, let alone took, that position.

The problem of widespread filing of bogus cases received the most support for (or the least opposition to) a rules change to facilitate early dismissal of meritless cases.  A rules amendment would have to be simple – not a “Lone Pine” order, but rather something much more basic.  A plausible version could be along the lines of mandatory initial discovery, which exists in “pilot project” form in both the District of Arizona and the Northern District of Illinois.  The local rules could be adapted easily enough to require production of all evidence of product identification/exposure, diagnosis of an injury, and their relative timing within a relatively short fixed period (60-90 days would seem reasonable) after filing of a complaint.  If a plaintiff couldn’t produce any facts or records that plausibly establish a claim, then the meritless action would be dismissed with prejudice.  Maybe a mandatory initial disclosure rule would be limited to MDLs above a certain threshold (100? 500? 1000?) number of plaintiffs.

Defendants might have to compromise – giving something to get something.  MDLs are notorious for imposing onerous discovery obligations on defendants, anyway, so frankly our side wouldn’t be giving up much, except for possibly timing.  One possibility, discussed at the conference in a different context, could involve early technology-assisted review of some categories of electronic documents.  We like predictive coding anyway, so as long as the timing is doable, there might be the basis of a workable compromise here.

Another possibility would be to amend Rule 20 to prohibit joinder of plaintiffs in the same complaint who have nothing in common except suing over the same product.  These multi-plaintiff, misjoined complaints are the primary way that the “park and ride” lawyers file their cases, with practically no factual information about any of the plaintiffs.  Not only do these improper plaintiffs cheat courts out of filing fees, but they burden defendants with the expense of vetting the plaintiffs’ cases.  In addition to forbidding the practice, each misjoined plaintiff could also be required to make a non-refundable deposit into the MDL plaintiffs’ common benefit fund.

Finally, the issue of statute of limitations tolling agreements came up.  There could be a legitimate problem, when a plaintiff’s lawyer finds him/herself up against the statute of limitations with a new client.  We don’t have problems with tolling agreements, as long as they’re one-off, and not an excuse for further abuse.  Tolling agreements cannot be an excuse for rampant failure to vet claims – the example given being “I have 2000 new cases, can I have a tolling agreement for two years.”  Tolling agreements are only appropriate for a short period of time.  We think that the same 60-90 day period mentioned above should be long enough to accommodate counsel who would otherwise have a legitimate need for a tolling agreement.

Interlocutory Appeal of Significant MDL Rulings

Another candidate for a rules change – one meeting with significantly more opposition from our colleagues on the other side of the “v.’ – is the interlocutory appeal of the resolution of certain “significant” motions typically made in MDLs.  Such appeals would correct an imbalance in current practice in that, if defendants win a dispositive motion, it’s an appealable final order, but if defendants lose the same motion, no appeal is available because the denial isn’t final.  Thus, the litigation continues, and the dispositive issue is appealed, if at all, years later – after a bellwether trial or a remand (in the rare event that happens).

That imbalanced access to appellate review is acceptable in an individual case, because delay caused by piecemeal appeals isn’t offset by the need to get things right, right away.  What’s acceptable in a single case, becomes a much bigger problem when the downside of an erroneous denial of a dispositive motion could dispose of hundreds or thousands of cases, particularly an appeal much further down the road adds extraneous pressure to affirm, or else a great deal of MDL activity, based on the resolution defendants contend is erroneous, goes down the drain.

Attorneys on the plaintiffs’ side – as was the case throughout the conference – were content with the status quo.  They pointed to existing certification procedures, but current procedures require the assent of the trial judge that denied the motion in the first place.  If denial is intended to force settlement, which is often the case, that assent won’t be forthcoming.  Plaintiffs pointed to the New Jersey Accutane litigation which has (in)famously been around for some fifteen years.  But that analogy is poor.  Most, if not all, of the delay in Accutane is not due interlocutory appeals, but rather from an prior judge’s extremely poor bellwether trial performance (almost every trial verdict was been reversed), or from appeals concerning the grant of dispositive motions – neither of which have any bearing on the current proposal for a Rule 23(f)-like equivalent permitting interlocutory appeals from motion denials in MDLs whether or not the MDL judge wants to allow it.

Ironically, the Rule 23(f) analogy was attacked by the plaintiff side as a bad analogy, because class actions were mostly “negative value” cases that, unlike mass torts, would go away without certification.  We think the analogy, while not perfect, is better than the other side will admit, for reasons discussed in more detail when we turn to bellwether trials.  Lawyers are, by nature, competitive, and the raised stakes of mass tort MDLs only exacerbates that tendency.  Thus, both sides – but in particular the plaintiffs – pour more money into bellwether trials than the individual cases could possibly be worth.  In that way, bellwethers become “negative value” cases, too.

Once again, a bit of serendipity strengthened the defense arguments.  Just the day before, the Fifth Circuit reversed the bellwether trial verdict in the first of several consolidated trials in the Pinnacle Hip MDL. See In re DePuy Orthopaedics, Inc., Pinnacle Hip Implant Product Liability Litigation, ___ F.3d ___, 2018 WL 1954759 (5th Cir. April 25, 2018).  This was the same MDL where the defendants had tried everything to obtain appellate review of the trial court’s erroneous rulings, including mandamus.  Now, something like seven years of MDL activity in Pinnacle Hip has come to just about naught, largely because no interlocutory appeals process existed to provide timely review of repeated erroneous rulings.

We have to admit, though, the other side has a point that it would be difficult to create a one-size-fits-all interlocutory appeal rule defining exactly what “significant” MDL rulings would be subject to its purview.  Preemption, for sure − nobody on either side disputed that a single preemption motion could be dispositive of so much (up to and including “all”) of an MDL to qualify.  Everything else was subject to considerable debate.  Some Daubert motions can have the same MDL-wide preclusive effect; our 2016 top ten cases post discusses two (Mirena and Lipitor) of these (three (Zoloft) if you count the honorable mentions), but lots of other Daubert motions in MDLs would not come close.

Then there’s everything else. Choice of law was mentioned, so were punitive damages.  The jurisdictional issue in Pinnacle Hip was critical, but most MDL judges aren’t that overreaching.  So defining “significant” for the purposes of a rules change could well pose complex problems.

Having thought about all that, however, se say, “why bother?” Let defense lawyers in the particular MDL decide.  Call it the “upon further review” rule if you want.  In the NFL, the rules allow coaches a set number of challenges to just about any on-field calls, and if the team wins a challenge they get another one, up to some absolute limit.  NFL coaches get to pick what calls they consider important enough to challenge.  Let counsel do the same for MDL interlocutory review.  Preemption orders should be appealable, and a set number (probably two or three) of other orders could be subject to interlocutory review at each separately represented defendant’s option.  If the defendant wins the appeal, it gets another challenge.

We don’t think that approach will result in an undue number of appeals – especially since the Supreme Court just reduced the appellate courts’ workload by throwing out Alien Torts Claims Act cases against corporations, creating some give.  Delay might be a more serious concern, but as with Rule 23(f), the MDL isn’t being stayed, so discovery and other activity would continue in the meantime.

Another issue raised, which would be beyond the control of the federal rules, is whether interlocutory appeals would sufficiently delay MDLs so as to encourage plaintiffs to file in state court.  News flash – plaintiffs have been avoiding federal court for as long as we can remember.  In one of Bexis’ first MDLs, some 1500 Bone Screw plaintiffs tried to hide out in state court in Tennessee (where the target defendant was “at home” jurisdictionally).  They might even have gotten away with that, had Tennessee not had an unusually short one-year personal injury statute of limitations, which tripped up plaintiffs after they agreed to a universal discovery date that was more than a year before they filed all those multi-plaintiff complaints.  See Maestas v. Sofamor Danek Group, Inc., 33 S.W.3d 805 (Tenn. 2000) (plaintiffs lose on cross-jurisdictional class action tolling; all 1500 cases dismissed).  One more reason for plaintiffs to stay out of federal court doesn’t mean anything.  If anything, avoiding federal court is harder now than before because the Supreme Court decided to enforce constitutional limits on personal jurisdiction.

Bellwether Trials

There was considerable discussion of bellwether trials, but we have doubts that rules could solve the problems that were mentioned.  Our view is to interpret the MDL statute as written, and restrict MDLs to “coordinated or consolidated pretrial proceedings.”  28 U.S.C. §1407(a) (emphasis added).  A textualist approach to the MDL statute would, and we think should, mean no trials, “bellwether” or otherwise, in the MDL transferee court.  Simple.  No rules change needed.

But totally contrary to decades of MDL practice.  Don’t hold your breath – although if someone wants to preserve it for appeal, this issue could be the next Lexecon.

There was some discussion of how bellwether plaintiffs are selected.  The Manual for Complex Litigation favors random selection.  MCL §22.315.  We also lean towards random selection, although we recognize that the other side can game even a random system by either filing, or not filing, certain types of cases in the MDL.  So even random selection needs to be policed to prevent plaintiffs from attempting to skew the result.

We also think that, if the rules were changed to facilitate the early dismissal of facially meritless claims, that would go a long way to solving the problems with random selection.  Right now, any random selection process necessarily exposes the prevalence of meritless cases, so that plaintiffs are loathe to agree to what, abstractly, is the most statistically valid method of yielding a representative selection of cases.

Ensuring “representativeness” was also discussed, but we frankly think that’s futile.  As someone pointed out, “random does not necessarily mean representative.”  Even what might at the beginning be the most representative of cases ceases to be representative once both sides pour more resources into preparing and trying that case than it could possibly be worth if being tried outside of the MDL.  We agree with the comment of one of the plaintiff-side speakers that “spending a million to win $500,000 is not an economic business model.”  Both sides committing extraordinary resources to a bellwether trial is a sure way to ensure that the case for that reason alone ceases to have any representative value.

On the plaintiff side, keeping the business model economic, under MDL circumstances, only encourages the reduction of representativeness.  Instead, we see plaintiffs focused on “ringing the bell” – adding punitive damages or consolidated plaintiffs to the mix to make the case harder to defend.  That’s the practical (as opposed to the textual) reason we oppose bellwether trials.  At minimum, as we’ve discussed before, defendants should take care to craft any Lexecon waivers to exclude punitive damages or consolidations.  We didn’t hear any proposed rules changes that would meaningfully improve the bellwether trial system.

Third-Party Litigation Funding

The group discussed a proposal, pending in Congress, requiring automatic disclosure of third-party funding agreements.  Interestingly, plaintiff-side speakers admitted that they demand disclosure of that kind of information themselves when setting up their steering committees, because their membership must be able to “take the heat,” and lawyers controlled by a “hedge fund” can’t be shaping their strategy.  To at least some plaintiffs’ speakers, third-party funding meant “a dummy in the room and a ventriloquist outside.”  One of the judges in attendance likewise thought that disclosure of third-party funding was a good idea to prevent conflicts.  If both plaintiffs and the judiciary favor disclosure is necessary to prevent conflicts, then it is hard to justify not routinely disclosing it to all sides, as insurance is disclosed.

Proponents of such funding stated that it was only a “professionalization” of activities that had long gone on the plaintiff side of litigation.  Perhaps, but that justification brings the response of “what, then, do you have to hide?”  If third party litigation funding is truly professionalized, then again, it resembles insurance, which is subject to automatic disclosure.  To be considered “mainstream,” third-party litigation funders need to act the part.

Proponents also raised the issue of disclosure of confidential work product if funding agreements are discoverable.  This concern seems like a red herring to us, as the contracts are easily drafted to omit any attorney evaluations of litigation.

Proponents also distinguished two uses of litigation funding. The first, which is more similar to corporate litigation funding arrangements, involves loans to plaintiff-side law firms, secured either by their interests in specific litigation or by interests in their entire pending litigation inventory.  These tend to have lower interest rates and involve less influence over litigation strategies or settlement decisions.  Disclosure of such funding is, however, essential to gauging the relative resources of both sides in determining who is going to pay for what discovery in MDL situations.  Plaintiffs should not be able to play at being David when their funding lines of credit are actually Goliath-sized.

The flip side is what was sometimes referred to as “payday lending” litigation funding − where the plaintiff is receiving what amounts to an advance on possible recoveries.  A lengthy discussion was had of claimed abuses – covering the NFL concussion litigation and the recent New York Times exposé of what has gone on in the Pelvic Mesh litigation.  In either case, immediate disclosure of litigation funding agreements would have prevented, or at least reduced, improper conduct, as transparency in funding would have raised red flags about the terms and timing of the agreements in question.  Suspicious agreements could then have brought to the court’s attention, or been the subject of additional discovery into their provenance.

Additional discovery was another aspect of the third party litigation funding debate.  Proponents argued, with some force, that disclosure of agreements would not be the end of matters.  They raised potential use of discovery into litigation funding as a means of opening yet “another front” in MDL litigation and attempting to disrupt the opposing side’s ability to finance itself.  We think that concern could be valid, but is easily addressed.  Disclosure of insurance hasn’t (except in Louisiana) led to insurance companies being sued directly by opponents of their insureds.  The work product issue raised above provides a useful analogy with, anything beyond the contract subject to a similar “good cause shown” and “otherwise unavailable” standard.  There is no inherent reason that such funding should be the source of additional discovery, but requiring prior court approval serves as another check.

Finally, just as plaintiffs want a look at their opponent’s insurance to know how much defendants have available for settlement, or whether the other side has sufficiently deep pockets, defendants should be able to make similar judgments based on plaintiffs’ third-party litigation funding.  A plaintiff who has to satisfy a funder is unlikely to take in settlement an amount that the defendant believes is reasonable if that means zero dollars in the plaintiff’s pocket.  In this respect, discovery of litigation funding is justifiable for the same reason as third-party litigation liens.  Very few plaintiffs would argue that insurance, health care, and other liens can be kept secret from the other side.  Anyone who has a piece of the potential recovery is, in practice a real party in interest who should be at the table and whose identity should be known to all.  All sides should know who is the ventriloquist and who is the dummy.

*          *         *         *

Several other topics were also discussed at the Duke conference, but they overwhelmingly involved the plaintiff side − composition of a plaintiff-side steering committee, judicial efforts to increase diversity on such steering committees, and common fund assessments.  But this post is already quite long, and these other topics are of less interest to our defense-oriented audience.

Sure, it was enjoyable to read In re DePuy Orthopaedics, Inc., Pinnacle Hip Implant Product Liability Litigation, ___ F.3d ___, 2018 WL 1954759 (5th Cir. April 25, 2018) (“Pinnacle Hip”), to see plaintiffs’ counsel hoisted on their own petard of improper and prejudicial evidence and arguments.  But there’s more to Pinnacle Hip than “Lanier-on-a-spit,” as it has been described in these parts.  Indeed, blogging plaintiffs’ attorney Max Kennerly, dropped a comment to our first Pinnacle Hip post (which we published – we scrub only spam, not opposing views) asserting that “the rest of the opinion was a huge win for plaintiffs.”

We largely disagree with Max’s comment, and this post explains why.

Initially, we note that the defendant in Pinnacle Hip was swimming decidedly upstream in all of its legal arguments, since it was opposing a jury verdict entered against it and seeking entry of judgment as a matter of law in its favor.  2018 WL 1954759, at *2.  That means all the trial evidence is construed in the plaintiffs’ favor.  Id. at *3 (“JMOL is warranted only if a reasonable jury would not have a legally sufficient evidentiary basis to find for the nonmovant.”) (citations and quotation marks omitted).

Design Claims

The first claim addressed in Pinnacle Hip was design defect.  See 2018 WL 1954759, at *3-9.  The defendant raised several arguments, all unsuccessfully.  First, the defendant argued that plaintiff had failed to satisfy the Texas alternative design requirement because that alternative that the plaintiffs offered – a “metal on plastic” (“MoP”) hip implant – was really a “different product” from the defendants’ metal-on-metal design (“MoM”), and thus cannot serve as a design alternative.  This is an argument we have featured several times on the blog.  In Pinnacle Hip, the conclusion was that “based on the record, that MoP is a viable alternative design to MoM.”  Id. at *4.

While we would have liked to win this, on the facts, this distinction between alternative product and design is more difficult for the defense than in the cases we’ve discussed in our prior posts, which usually involve not using the product at all, or using some other product that is much less suited for the use in question.  Our classic example of alternative cause abuse is Theriot v. Danek Medical, Inc., 168 F.3d 253 (5th Cir. 1999), a Bone Screw case in which the supposed “alternative” was a different type of surgery not using the product at all.  That’s distinct from redesigning one part of a device system to use a different material, as indeed, Pinnacle Hip pointed out.  2018 WL 1954759, at *9.  Pinnacle Hip reaffirmed that similar-use products that “fail[] to perform the discrete kinds of functions for which the alleged defective was designed” or with a “wide disparity in price” cannot be considered alternative designs.  Id. at *4, *7.  However , the risk/utility defect test “contemplates that a proposed alternative design might reduce a product’s utility . . . without rendering the alternative an entirely different product.”  Id. at *5.  That means some variation has to exist without “moot[ing] the entire defect test.”  Id.

Construing the record to favor plaintiffs, Pinnacle Hip resulted in another point on the uncertain, “practically impossible to settle in the abstract,” id., at *4, line between different design and different product.  While we’d like to have won, Pinnacle Hip does not move the line itself in any lasting fashion prejudicial to the defense.  The ultimate holding was that a “cross-linked” MoP is not sufficiently different from the defendant’s MoP design to be considered a different product.  2018 WL 1954759, at *6 & n.13.  The underlying principle that the distinction between product and design seeks to protect is preventing automatic liability against whole classes of products – cigarettes, motorcycles, birth control pills, or pedicle screw fixation devices – for simply being what they are and having certain inherent risks.  That principle remains intact after Pinnacle Hip.

The defendants also lost a preemption argument – that design defect claims “’stand[] as an obstacle to the accomplishment and execution of the full purposes and objectives’ reflected in the MoM-related regulations of the FDA.”  2018 WL 1954759, at *7.  According to the defendants, because the plaintiffs were seeking “categorical” liability, that all MoMs should be “banned outright,” there should be preemption. Id. at *8.  But that’s not what the Fifth Circuit found was what happened:

[I]t is not the case that plaintiffs’ theory reached all possible MoMs.  All would agree that, despite the sweeping language with which plaintiffs presented their case, their claims were impliedly limited to presently available technologies and the adverse health effects they allegedly engender.

Id.  But the record showed that “[t]he FDA effectively withdrew all MoMs from the market . . . and left open a single door in the form of PMA.”  Id.  On this set of facts, it could not be said that banning something that the FDA had already essentially removed from the market, save for an alternative that has not yet produced an FDA-approved product, was an interference with “the FDA’s regulatory objectives.”  Id.

While losing a preemption argument is not something we would recommend, this particular type of preemption argument has never been successful that we are aware of, so it’s no great loss.  We’ve advocated at some length that the Medtronic, Inc. v. Lohr, 518 U.S. 470 (1996), decision be overturned.  But that argument is predicated on changes to 510(k) clearance created by Congress in 1990.  In Pinnacle Hip, “MoMs were sold before 1976 and have traditionally been treated as pre-amendment class III devices.”  2018 WL 1954759, at *8.  So Pinnacle Hip doesn’t affect even the distinctions that we draw from Lohr.  The preemption argument rejected in Pinnacle Hip would require the complete reversal of Lohr, even on Lohr’s facts, to succeed.

By far the better preemption argument, based on current law, with respect to 510(k) design defect claims, is that they amount to “major changes” that require prior FDA review, and probably an entirely new supplemental submission, before they could be implemented.  That should put design defect claims at odds with the “independence principle” in PLIVA, Inc. v. Mensing, 564 U.S. 604 (2011), and Mutual Pharmaceutical Co. v. Bartlett, 570 U.S. 472 (2013), resulting in preemption of all design claims that could make a difference in a product liability action.  That argument, which does not depend on Lohr either way, was not addressed at all in Pinnacle Hip.

Finally, the defendants in Pinnacle Hip also lost on their Restatement (Second) of Torts §402A, comment k (1965), argument, which was that Texas law holds all prescription medical products, including medical devices, to be “unavoidably unsafe” within the meaning of comment k, so that those “unavoidable” risks can only be warned about and not treated as design defects.  Pinnacle Hip was unwilling to expand Texas’ application of comment k from prescription drugs to include prescription medical devices.  2018 WL 1954759, at *9.  That places Pinnacle Hip in a distinct minority position, since literally hundreds of cases, and the Third Restatement, apply limits on design defect claims equally to all types of prescription medical products.  Bexis’ book collects these cases.  Drug & Medical Device Product Liability Deskbook §2.02[2] at pp. 2.02-13 to -16 n.14 (for the proposition that “almost all courts have extended the unavoidably unsafe product exception to medical devices”).  However, as the Fifth Circuit correctly pointed out, not many of those opinions are under Texas law.

The further discussion of case-by-case versus across-the-board comment k application in Texas, 2018 WL 1954759, at *9, is more troubling, as the trend in Texas courts (in drug and vaccine prescription product cases) has favored the “blanket” approach.  Pinnacle Hip complained, in a footnote, that “Texas caselaw offers almost no guidance on how to go about that case-by-case inquiry.”  Id. at *9 n.22.  There is good reason for that lack of precedent – because Texas law has not employed tests that require such inquiry.  See Reyes v. Wyeth Laboratories, 498 F.2d 1264, 1273 (5th Cir. 1974) (applying comment k without case-by-case analysis to a vaccine; holding that the only viable claim was inadequate warning); Gonzalez v. Bayer Healthcare Pharmaceuticals, Inc., 930 F. Supp.2d 808, 817-18 (S.D. Tex. 2013) (applying comment k to prescription drug without case-by-case analysis); Woodhouse v. Sanofi-Aventis United States LLC, 2011 WL 3666595, at *3-4 (W.D. Tex. June 23, 2011) (holding, without further analysis, that “comment k applies to products such as [defendant’s prescription drug]”); Holland v. Hoffman-La Roche, Inc., 2007 WL 4042757, at *3 (N.D. Tex. Nov. 15, 2007) (“Prescription drugs are not susceptible to a design defect claim where, as here, the drug is ‘accompanied by proper directions and warning.’”) (quoting comment k); Carter v. Tap Pharmaceuticals, Inc., 2004 WL 2550593, at *2 (W.D. Tex. Nov. 2, 2004) (“Under Texas law, all FDA-approved prescription drugs are unavoidably unsafe as a matter of law”); Hackett v. G.D. Searle & Co., 246 F. Supp.2d 591, 595 (W.D. Tex. 2002) (“under Texas law and comment k of the Restatement, Defendants can only be held strictly liable if the drug was not properly prepared or marketed or accompanied by proper warnings”).  Contra: Adams v. Boston Scientific Corp., 177 F. Supp.3d 959, 965 (S.D.W. Va. 2016) (refusing to apply comment k across-the-board in medical device case) (applying Texas law).  The comment k portion of Pinnacle Hip is where we think that Max is on the firmest ground.  The decision made Texas law worse.  This issue will ultimately be won in Texas appellate courts or perhaps before the Texas legislature, where it would be quite simple to extend the warning related presumption of §82.007 to all medical devices approved or cleared by the FDA.

Warning Claims

As to warning claims (which Texas law calls “marketing defects”), the defendants lost on adequacy as a matter of law.  Pinnacle Hip, 2018 WL 1954759, at *10.  Unfortunately, defendants usually lose on this ground, so it’s big news – and trumpeted on this blog – when a defendant wins a judicial holding that its warning is adequate as a matter of law.  No surprise there.  In Pinnacle Hip, that discussion ended:

Not until after the FDA issued its proposed rule in 2013 did defendants specifically warn about the metallosis, pseudotumors, and tissue necrosis − the sorts of conditions that plaintiffs maintained caused their revision surgery.

Id. at 11.  As defense counsel, we interpret the Fifth Circuit’s observation as an invitation to seek an adequacy as a matter of law ruling as to post-2013 claims (if there are any) in the litigation.

In the causation discussion pertaining to the warning claims, Pinnacle Hip of course followed the learned intermediary rule.  It discussed the role of “objective” evidence of causation:

At the threshold, the parties debate the relevance, under Texas law, of “objective evidence” − that is, evidence “that a different warning would have affected the decision of a reasonable doctor.” . . . Here, plaintiffs proffered objective evidence in [expert] testimony that, if the full risks of MoM were known to physicians, “they would run to [a different product].”

2018 WL 1954759, at *11 (citations omitted).  As we’ve discussed before, “objective” expert testimony about what “reasonable physicians” would have done is usually disallowed in learned intermediary cases.

On this point, however, Fifth Circuit law, has not been as favorable as other courts.  In Thomas v. Hoffman-LaRoche, Inc., 949 F.2d 806, 812 (5th Cir. 1992), the court actually allowed expert testimony on what a “reasonable” physician might have done – but that case was under Mississippi law.  See Ackermann v. Wyeth Pharmaceuticals, Inc., 526 F.3d 203, 212 (5th Cir. 2008) (suggesting that Thomas would not apply to Texas law).  We’ve been aware of the brief Texas Supreme Court passing reference to “objective” evidence in Centocor, Inc. v. Hamilton, 372 S.W.3d 140, 171 (Tex. 2012) (plaintiffs “presented no objective evidence”), but felt no reason to let the other side know it was there.

Now it’s been discovered, however.  The Fifth Circuit allowed such evidence to be admissible, 2018 WL 1954759, at *12 (“objective evidence is at least relevant”), but did not find it decisive in situations where the plaintiff would otherwise have suffered dismissal.  Critically, Pinnacle Hip did not allow unsupported “expert” testimony about what an objectively “reasonable physician” would have done be enough to let plaintiffs survive when they didn’t have prescriber testimony – which would have been the equivalent of allowing a heeding presumption in Texas, something the Fifth Circuit rejected outright in Ackerman, 526 F.3d at 212-13.

Relevance, however, does not imply sufficiency.  In the [learned intermediary] context, causation entails two distinct factual predicates:  first, that the doctor would have read or encountered the adequate warning; and second that the adequate warning would have altered his treatment decision for, or risk-related disclosures to, the patient.  Centocor addressed only the latter, suggesting a jury might be allowed to presume a particular physician would respond “reasonably” to fuller disclosure.  But that presumption must yield to contrary subjective testimony by the treating physician, and Centocor fails to explain how objective evidence would apply to whether that doctor would have read or encountered the warning in the first instance.  When considered for the limited purpose intimated in Centocor, objective evidence would have little bearing on any of [these] plaintiffs’ claims.

Pinnacle Hip, 2018 WL 1954759, at *12 (footnotes omitted) (emphasis original).  Thus, where the plaintiffs had no testimony from their prescribing physicians, those claims continue to fail, and some “expert” claiming otherwise cannot change the result.  Id. (granting JMOL in no-prescriber testimony cases).  Likewise, any “objective” testimony “must yield to contrary subjective testimony by the treating physician.” Id.  So plaintiffs cannot create questions of fact with expert testimony where the prescriber has affirmatively testified that a different warning would not have changed what s/he did.

Only what the Fifth Circuit described as “mixed bag” prescriber testimony (the prescriber said different things in different parts of his testimony) cases got to the jury in Pinnacle Hip, id. at *13, and those have always been harder cases for the defense anyway.  At best, for plaintiffs, paying some expert to opine that a “reasonable” physician would have heeded a warning won’t save any plaintiff who lacked a plausible warning causation case in the first place.  At worst, Pinnacle Hip means more plaintiff-side noise at trial in cases already going to trial on warning causation.  All in all, the defense side is better off after Pinnacle Hip than where it had been in the Fifth Circuit with only the Thomas precedent.  We definitely don’t agree with Max here.

Personal Jurisdiction

In Pinnacle Hip, the manufacturer’s parent corporation was held potentially liable because of the amount of guidance and control permitted by an inference from the facts (based on a “clear error” standard).  2018 WL 1954759, at *15.  Those facts allowed the court to conclude that more than a “passive parent-subsidiary relationship” existed as to this product.  Id. at *16.  To us that’s “big whoop” for two reasons.  First, the “clear error” standard does not apply at the district court level where jurisdictional motions are initially decided.  Second, and more important going forward, the plaintiffs proceeded under a “stream of commerce” theory where the Fifth Circuit had previously “embraced [the] more expansive” (Brennan) side of the 4-4 split in Asahi Metal Industry Co. v. Superior Court, 480 U.S. 102 (1987).  Pinnacle Hip, 2018 WL 1954759, at *15.  As we’ve discussed, that broad “stream of commerce” jurisdictional theory is probably toast after Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017).  Pinnacle Hip did not even cite BMS in its discussion of personal jurisdiction, so we guess that this argument wasn’t raised.  In light of the BMS precedent, the Pinnacle Hip jurisdictional holding should be treated as something of a “one-off” applicable to this MDL, but not to future litigation where BMS will stand front and center.

Miscellaneous Claims

Pinnacle Hip includes the Fifth Circuit’s full-throated reaffirmance of our favorite Erie principle:

[T]hat debate [about what a Texas court might do] is beside the point.  When sitting in diversity, a federal court exceeds the bounds of its legitimacy in fashioning novel causes of action not yet recognized by the state courts.  Here, despite ample warning, the district court exceeded its circumscribed institutional role and expanded Texas law beyond its presently existing boundary.

2018 WL 1954759, at *17 (footnote, citations, and quotation marks omitted) (emphasis added).  The court therefore threw out the spurious invention of an “aiding and abetting” cause of action that had no reasonable predicate in Texas law.  Id.

The court did allow two arguably weird theories against the parent corporation – all product liability theories imposing liability against a non-manufacturing parent under a theory not also cognizable against the manufacturing subsidiary are likely to be weird − to survive.  One of those, so-called “nonmanufacturer seller” was tied to statutory exceptions to immunity for nonmanufacturers.  Id. at*18.  The court held, instead, that the parent was only held liable for old-fashioned design or warning liability, after the record (again, construed in favor of plaintiffs as verdict winners) established one of statutory exceptions from nonmanufacturer immunity.  Id. That’s a little peculiar to non-Texas lawyers, but since Texas has this statute, it must mean something.

The other oddball claim that survived is one of those “last refuge of a scoundrel” theories, negligent undertaking” (a/k/a “Good Samaritan”) liability.

Texas caselaw reveals no precise control threshold a parent must cross before undertaking a duty to its subsidiary’s customers.  Texas courts have made clear that mere possession of “the authority to compel” a subsidiary is not enough − the parent “must actually” exercise that authority in a manner relevant to the undertaking inquiry.

Pinnacle Hip, 2018 WL 1954759, at *19 (footnote omitted).  Based on the stringent standard for interpreting record evidence, the court let this one slide.  Id.  Not good, but not likely to arise very often.

But there’s more afoot than just these three theories. Two years ago, we awarded In re DePuy Orthopaedics, Inc., 2016 WL 6268090 (N.D. Tex. Jan. 5, 2016), our ranking as the number six worst decision of that year, chiefly because of the large number of unprecedented theories under Texas law that this opinion permitted:

(1) extending negligent misrepresentation beyond “business transactions” to product liability, unprecedented in Texas; (2) ignoring multiple US Supreme Court decisions that express and implied preemption operate independently (as discussed here) to dismiss implied preemption with nothing more than a cite to the Medtronic v. Lohr express preemption decision; (3) inventing some sort of state-law tort to second-guess the defendant following one FDA marketing approach (§510k clearance) over another (pre-market approval), unprecedented anywhere; (4) holding that the learned intermediary rule does not apply whenever a defendant “compensates” or “incentivizes” physicians to use its products, absent any Texas state or appellate authority; (5) imposing strict liability on an entity not in the product’s chain of sale, contrary to Texas statute (§82.001(2)); (6) creating a claim for “tortious interference” with the physician-patient relationship, again utterly unprecedented; (7) creating “vicarious” breach of fiduciary duty for engaging doctors to serve as expert witnesses in mass tort litigation also involving their patients, ditto; and (8) construing a consulting agreement with a physician as “commercial bribery” to avoid the Texas cap on punitive damages, jaw-droppingly unprecedented.

While only item (5) was at issue in Pinnacle Hip, the Fifth Circuit’s invocation of Erie conservatism bears ill for all of the other judicial flights of fancy that have been allowed during the course of the Pinnacle Hip litigation.

Constitutionality of Punitive Damages Cap

For completeness, plaintiffs also lost their constitutional challenge to the Texas statute capping punitive damages at twice compensatory damages.  “Plaintiffs’ cross-appeal is meritless, and we dispose of it by footnote.”  Pinnacle Hip, 2018 WL 1954759, at *1 n.4.  That footnote went further, and characterized those constitutional claims as “frivolous.”  Id. at *23 n.72.  No matter what the constitutional challenge, a punitive damages cap “need only survive rational-basis review,” which it did in Pinnacle Hip “by injecting predictability into exemplary damages awards and preempting potentially unconstitutional awards.”  Id. (citations omitted).

Conclusion

When all is said and done, we view Max’s characterization of Pinnacle Hip as a “huge win for plaintiffs” as mostly overblown hyperbole, perhaps worthy of inclusion in the closing arguments that the Fifth Circuit held warranted a new trial.  The Fifth Circuit did some damage to comment k, but all the rest of the legal holdings were trivial, fact-bound, not likely to be useful in future cases, or some combination of those.  The forceful reiteration of conservative principles of Erie predictions of state law leave us hopeful that the Pinnacle Hip MDL will see some Fifth Circuit-mandated clean up – or, if not, perhaps the appellate court’s not-so-veiled Parthian, parting shot may have to be fired in earnest:

[D]efendants, despite their serious critiques of the district judge’s actions in this case and related MDL proceedings, see In re DePuy Orthopaedics, Inc., 870 F.3d 345, 351 (5th Cir. 2017) (finding “grave error”), have not asked us to require these cases to be reassigned to a different judge under “this court’s supervisory power to reassign,” United States v. Stanford, 883 F.3d 500, 516 (5th Cir. 2018).  We express no view on the issue but note that reassignment is both “extraordinary” and “rarely invoked.”  Id. (citation and internal quotation marks omitted).

Pinnacle Hip, 2018 WL 1954759, at *27, n.83.  Obviously, the Fifth Circuit in Pinnacle Hip was uncomfortable with the prospect of overruling the JPMDL’s assignment of this MDL, but this final footnote stands as a clear warning that, if further provoked (such as by continuing consolidated trials, or resort to other prejudicial evidence that the court noted but did not rule on), it will consider doing so.

On Wednesday, the Fifth Circuit was finally able speak to what’s been going on in a Dallas courtroom that has racked up over $1.7 billion—that’s billion—in jury verdicts over the last two years in the Pinnacle Hip Implant MDL. And the Fifth Circuit entered the room loudly. It ordered a new trial of the plaintiff’s very first victory, the one that produced a half-billion dollar verdict. The court did not hold back, making it perfectly clear that it vacated the judgment due to “the district court’s evidentiary errors and [plaintiffs’ attorney Mark] Lanier’s deception.” Slip Op. at 6.

The “evidentiary errors” have been a controversial part of these MDL trials since the time of our first post about them two years ago. Even then, we were struck by the “number and nature” of these evidentiary rulings, which in the aggregate suggested “an almost uninterrupted flow of unduly prejudicial and irrelevant information to the jury.”  The Fifth Circuit now agrees, highlighting two of them as the basis to order a new trial.

First, the Saddam Hussein evidence. Slip Op. at 43-46. That’s right. The court allowed evidence concerning Saddam Hussein into a hip implant trial. Its decision was based on a deferred prosecution agreement, one in which J&J took responsibility for the actions of affiliates who had bribed officials in the Iraqi government. These affiliates had nothing to do with the Pinnacle Hip Implant device. Regardless, after defendants elicited testimony on their own positive internal culture and marketing, the district court ruled that the defendants had thereby “opened the door” to Saddam Hussein, the deferred prosecution agreement and all sorts of other stuff. With light now green, the plaintiffs’ attorney thereafter featured Saddam Hussein and bribes and prosecution in his questioning of witnesses and closing argument. Mind you, this was a hip implant medical device trial.

The Fifth Circuit rejected the trial court’s “open door” ruling. It held that “the rules of evidence do not simply evaporate when one party opens the door on an issue.” Id. at 44. Prior bad acts cannot be used to convince a jury that defendants acted as wrongdoers in the case before it. Id. The Fifth Circuit held, however, that the plaintiffs’ attorney asked the jury to do just that. To illustrate this, the Fifth Circuit quoted the paragraph below from plaintiffs’ closing argument. Note that the italicized emphasis in the paragraph was placed there by the Fifth Circuit, as was the single word “Indeed” after that paragraph:

If you go back and look at the DPA, that’s the deferred prosecution agreement where the company paid money one time because of kickbacks to doctors in America, the other time because of the bribes to Saddam Hussein’s government, the bribes in Greece, Romania, Poland and other places where they were bribing people to put in . . . their products. The DPA has [J&J] admitting its responsibility in it. J&J is admitting that they’re responsible. They have already taken this issue out of your hands realistically. That alone is a winner. . . . [J&J] has admitted their responsibility for this. That ought to be enough.

Indeed.

Id. at 45. The Fifth Circuit wrote that this closing argument and the earlier questioning “tainted the result by inviting the jury to infer guilt based on no more than prior bad acts . . . . That alone provides grounds for a new trial.” Id.

The second evidentiary ruling rejected by the Fifth Circuit was the trial court’s decision to allow plaintiffs to use hearsay in a resignation letter from a DePuy employee alleging racism within the company. Slip Op. 46-48. Again, this was a hip implant trial. Calling it a “spectacle,” the Fifth Circuit ruled that reading this letter to the jury “refocused its attention on serious, and seriously distracting, claims of racial discrimination that defendants had no meaningful opportunity to rebut via cross-examination. This spectacle fortifies that a new trial is required.”

These evidentiary rulings alone were enough to upend the judgment. But there were more. As we laid out in our previous posts, the trial court made multiple other questionable evidentiary rulings that allowed questioning and argument on things like suicide, cancer, connections to the tobacco industry, transvaginal mesh suits, and so on. Having already overturned the judgment, the Fifth Circuit declined to address these other evidentiary rulings. But it did warn the trial court to “weigh carefully the application of Rule 403 and 404(b)” when considering these issues at future trials. Slip Op. at n. 71.

Next, the Fifth Circuit found additional grounds to overturn the judgment due to what it called “deception” by the plaintiffs’ attorney regarding plaintiffs’ experts, something we wrote about last year. Plaintiffs classified two of its experts as “non-retained,” meaning not paid. At trial, plaintiffs’ attorney contrasted this with what he called the “bought testimony” of the defendants’ expert. The problem is, however, that plaintiffs’ experts were “bought” too. Before trial, plaintiffs’ attorney donated $10,000 to St. Rita’s Catholic School, the favorite charity of one of the two experts. More blatantly, after trial, plaintiffs paid $65,000 in total to the two experts.

It would be difficult to overemphasize how hard the Fifth Circuit came down on this, labeling it “deception.” Slip Op. at 6. The court was clearly displeased. Its opinion (see pages 49-57) is littered with snide comments. Noting that Mr. Lanier mentioned to the jury that he had shared the “best apple pie in the world” with one of the two experts, the court wrote, “St. Rita’s and the $10,000 check went unmentioned.” Id. at 50. After quoting Mr. Lanier contrasting the supposedly “bought testimony” of the defendants’ experts with the supposed “real life” testimony of his two experts, the Fifth Circuit wrote: “As between ‘real life’ and ‘bought testimony,’ [the jury] chose the former by a margin of $502 million. But that choice was a false one, manufactured entirely by Lanier.” Id. at 52.

With the unmistakable intent to drive its point home, the Fifth Circuit clarified in just about every way possible that this type of maneuvering was improper:

This is the rare case in which counsel’s deceptions were sufficiently obvious, egregious, and impactful to penetrate the layers of deference that would ordinarily shield against reversal.

Lanier’s failure to disclose the donation, and his repeated insistence that Morrey Sr. had absolutely no pecuniary interest in testifying, were unequivocally deceptive.

Lawyers cannot engage with a favorable expert, pay him “for his time,” then invite him to testify as a purportedly “non-retained” neutral party. That is deception, plain and simple.

We find, by the “clear and convincing” evidence of common sense, that Lanier misled the jury in creating the impression that Morrey Jr. had neither pecuniary incentive nor motive in testifying. Neither our double deference nor counsel’s specious reasoning can alter that conclusion.

Calculated or not, falsehoods marred plaintiffs’ victory. The Verdict cannot stand.

Got it. This lambasting by the Fifth Circuit could change the game in the Pinnacle Hip Implant MDL. Proper boundaries may now be back in place, or at least some of them. There are more appeals to come, and they involve serious procedural and jurisdictional issues that were front and center in the two trials that followed this one. In fact, there may be more to come from this opinion, at least from us, as it also granted DePuy judgment on two plaintiffs’ failure to warn claims and J&J judgment on plaintiffs’ aiding and abetting claims—something for us to address another day.

One thing is already clear from this opinion, though. Two years of this MDL may have been wasted on defective jury trials. But, if a reset is needed, it must be done. The goal of an MDL is not to hammer defendants with every possible negative piece of evidence, relevant or not, so as to produce large verdicts. It is to establish a framework under which the parties can properly litigate and value the hundreds or thousands of cases within a complex mass tort. The Fifth Circuit’s opinion is an important step toward that proper construct.

Anyone interested in what’s wrong with mass torts in today’s litigation landscape should read the recent article in the New York Times, “How Profiteers Lure Women Into Often-Unneeded Surgery,” which ran in the paper on April 14, 2018, and is available online here.  Briefly, the article exposes litigation (and pre-litigation) conduct that amounts, at best, to unnecessary surgery, and, at worst, to certain doctors, lawyers, and litigation funders conniving to bring about harmful surgeries that caused additional injury to their own supposed clients.  Here are some excerpts from the article – there’s lots more, but we have to limit ourselves to fair use:

  • “[A] growing industry that makes money by coaxing women into having surgery − sometimes unnecessarily − so that they are more lucrative plaintiffs in lawsuits against medical device manufacturers.”
  • “Lawyers building [vaginal mesh] cases . . . turn[ing] to marketing firms to drum up clients.”
  • “Women with mesh implants . . . receiving torrents of unsolicited phone calls, some originating overseas” from telemarketers who “seemed to know their medical histories.”
  • “[M]arketers turn[ing] to finance companies to provide high-interest loans to the [women] that have to be repaid only if the [women] receive money from the case.”
  • “Those loans are then used to pay for surgery performed by doctors who are often lined up by the marketers.”
  • Promises that “all [a woman’s] expenses would be covered and that she would be set up with a lawyer to help her sue the mesh manufacturer.”
  • “[M]iddlemen” arranging for surgery in “walk-up clinics” in “shopping malls.”
  • Doctors performing “four or five removals in a day” and pocketing as much as $14,000 a day.
  • “The women generally didn’t meet the doctors who would be operating on them until shortly before the procedure.”
  • Women charged $21,000 per surgery, “at a double-digit interest rate,” to be paid for from “lawsuits brought by women against the mesh manufacturers.”
  • “[H]undreds, perhaps thousands, of women . . . sucked into this assembly-line-like system. . . .  The profits are immense.”
  • “[P]laintiffs who do collect settlements see much of the money go to the financing firms.  Another large slice goes to their lawyers.”

Other than what’s obviously disturbing about reports of such dubious goings on, the Times article leads us to two observations:

First, the conduct described in the Times article provides further support, in the form of a compelling example, for the increasing calls for some sort of mandatory disclosure of litigation financing, at least in mass torts.  The abuses described in the article show how both the integrity of the mass tort litigation process, and the reputation of litigation financing generally, can be harmed by litigation solicitation and financing arrangements not being transparent, particularly where the litigation itself is largely solicitation-driven, as in most mass torts.

As the Times article demonstrates, solicitation, while constitutional under the First Amendment, is rife with potential for abuse.  Our colleagues on the other side might counter that so is pharmaceutical detailing.  Well, precisely to prevent abuse, the sales practices of our clients are regulated in multiple ways − including disclosure of financial arrangements between them and physicians that prescribe/use their products.  Those on the P-side with nothing to hide have nothing to fear from disclosure.  Thus, if litigation financing wants to be considered as legitimate as, say, insurance, that supports the case for routine disclosure of such arrangements in the same fashion as insurance, as Wisconsin recently decided to do:

Except as otherwise stipulated or ordered by the court, a party shall, without awaiting a discovery request, provide to the other parties any agreement under which any 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.

Wis. Eng. Asbly Bill 773 §12 (new §804.01 (2)).  Whatever the merits of the Wisconsin approach, or whether it’s necessary outside of the mass tort context, that approach has the advantage of being a simple, bright line standard.

Certainly, disclosure would be a sure and quick way to expose the kind of deals described in the Times article that women have been enticed into in the Vaginal Mesh litigation.  Existence of this kind of financing would be a red flag that the injury claims in such cases required careful investigation.

Which brings us to….

Second, the Times article strongly suggests that these abuses are widespread in the Vaginal Mesh MDL litigation.  Arrangements this elaborate are not worth the trouble for only a small number of cases.  According to the Times article, “perhaps thousands” of lawsuits have been tampered with in the ways that the article describes.

Without disclosure, the kind of aggravation of damages described in the Times article – ironically, the opposite of the accepted common-law duty to mitigate − is hard to unearth.  The Times article quotes “Magistrate Judge Cheryl Eifert in West Virginia”:

“People are claiming the Fifth [Amendment privilege against self-incrimination] and so on and so forth.  They don’t have to talk about necessarily how much money they make, per se, but if someone would just give them an idea of how the arrangement works.  But nobody’s willing to do that.”

Magistrate Judge Eifert has been overseeing aspects of the Vaginal Mesh MDLs.  E.g., In re American Medical Systems, Inc. Pelvic Repair Systems Products Liability Litigation, 946 F. Supp. 2d 512 (Mag. S.D.W. Va. 2013) (opinion by Eifert).

That’s concerning because, as we pointed out a couple of months ago, discovery in the remaining 23,000 cases in the Mesh MDLs has been ordered to be completed with:  (1) extreme haste, and (2) significant limitations on the number of interrogatories that can be propounded and witnesses deposed (see paragraph 2 of the four PTOs linked to in the prior post).  Since there may well be hundreds (if not more) of those 23,000 cases involving questionable surgeries conducted under questionable circumstances, the current rush to remand – combined with the obstructive tactics described in the Times article – creates a considerable risk of miscarriage of justice.  Defendants do not appear to have been given the time or the discovery tools needed to unearth plaintiff-side shenanigans on the scale described in the Times article.  There comes a point at which the efficiency objectives of multi-district litigation have to yield to the higher objectives of justice.

In the Diet Drug litigation – a mass tort of comparable scope – all kinds of problems arose with “the District Court [being] inundated with fraudulent benefits claims.”  In re Diet Drugs (Phentermine/Fenfluramine/Dexfenfluramine) Products Liability Litigation, 573 Fed. Appx. 184, 185 (3d Cir. 2014).  Unfortunately, the widespread fraud perpetrated in Diet Drug only became apparent after settlement – as would eventually be the case here, since contingent fee surgeries will almost surely be a topic of inquiry after the Times article.  The opportunity still exists in the Pelvic Mesh MDLs for diligent discovery to ferret out the false or inflated claims, but that can only happen if adequate discovery is permitted to occur.

We wrote a post not too long ago recommending that MDL defendants seriously consider limiting so called “Lexecon (read the prior post if you don’t know what that means) waivers” to single plaintiff trials and to exclude punitive damages.  We included a caveat that “this idea wouldn’t have worked” in all situations, if the MDL judge is bound and determined to chase down a non-waiving defendant in the original transferor district.  See Eghnayem v. Boston Scientific Corp., 873 F.3d 1304 (11th Cir. 2017) (MDL judge trying out-of-district case as visiting judge).

We were assuming, of course, that the MDL court could engineer a temporary appointment as a visiting judge under 28 U.S.C. §292(d) – something we’d first brought up a long time ago.  Indeed, the Manual for Complex Litigation (4th) mentions this possibility.  See Id. §20.132, at 247 (Fed. Jud. Ctr. 2005).

We should have researched that assumption first, or at least gone back through our own old posts.  It turns out that the only appellate authority on MDL judges trying cases as visiting judges says you can’t do it.  See In re Motor Fuel Temperature Sales Practices Litigation, 711 F.3d 1050 (9th Cir. 2013) (“MFT”).  Not only that, we actually blogged about the MFT ruling when it was decided.  If we hadn’t been preparing an MDL best practices project for Duke Law School, our forgetful ignorance would have continued.

Anyway, we figure if we can forget something like that – although we actually wrote about it – you might, too.  So with the problem of multi-plaintiff consolidated punitive damages MDL show trials fresh in our minds, here’s a refresher:

MFT refused to approve a “temporary assignment” designation sought by an MDL judge to try a case that was otherwise precluded by Lexecon, even though Lexecon was not totally on point

Lexecon dealt with venue, not judicial case assignment.  The Lexecon Court held that a plaintiff is entitled to select the venue where the case will be tried, and this right can’t be undermined by having the case transferred for pre-trial proceedings under the MDL process.  Venue is important for a number of practical reasons, such as ease of access to the forum by plaintiffs and their lawyers and, perhaps most important, selection of the jury pool.  Venue does bear on which judge will be assigned to the case, as one of the judges of that district will normally preside, but there’s no guarantee of that.

711 F.3d at 1054.  Nonetheless there was “some force” to the argument “that allowing the MDL judge to follow the cases after the conclusion of pre-trial proceedings resuscitates the self-referral practice that the Supreme Court unanimously repudiated in Lexecon.”  Id.  Just not enough force to win the point on that basis, since Lexecon itself did not dictate the outcome.

Instead, MFT looked to the Guidelines for the Intercircuit Assignment of Article III Judges promulgated under the Chief Justice’s authority the year before.  These guidelines set out specific criteria for allowance of intercircuit transfers, and letting an MDL judge try cases s/he otherwise couldn’t wasn’t one of them.  Rather such transfers are permitted only under very specific circumstances.  “Only severe or unexpected over-burdening, as happens when a judge dies or retires, when the district is experiencing a judicial emergency or when all the judges are recused because of a conflict, will warrant bringing in a visiting judge.”  MFT, 711 F.3d at 1053.

While we would ordinarily include a link to the guidelines themselves, they’re not independently available either on the Internet or on the Federal Judicial Center’s website. Helpfully, they are attached as “Appendix A” to the MFT decision.  These guidelines do not provide any support for an MDL judge taking the initiative to ride shotgun on remanded cases:

  • The “primary source of intercircuit assignments should be senior judges.”
  • The first choice for designating a visiting judge is “from another court within the circuit.”
  • Assignments are not controlled by the would-be visiting judge, but rather selected by the chief justice and the Committee on Intercircuit Assignments, in order “to avoid the appearance of impropriety or conflict of interest.”
  • “The appropriate way to initiate a formal request for an intercircuit assignment is for the circuit chief judge to send a Certificate of Necessity to the Chair [of the Committee on Intercircuit Assignments].”

Thus MFT rejected the request of an MDL judge to retain authority over a remanded case:

[T]he process of transferring judges between circuits, as delimited by the Chief Justice’s Guidelines, is directed strictly toward meeting judicial necessities, whereas the transfer in this case would serve a different purpose. . . .  [H]aving the district judge who conducted MDL pre-trial proceedings also preside over the trial of the case can improve judicial efficiency, preserve scarce judicial resources and enhance MDL judges’ control over their proceedings.  These are worthy goals, to be sure, but not ones in any way reflected in the Guidelines.

MFT, 711 F.3d at 1054.  Allowing a transfer would effectively divest the judges of the transferor district of cases ordinarily assigned to them.  There is “no authority empowering the chief judge of the circuit to re-assign cases pending before other judges, or to remove cases from the district’s assignment wheel” in the absence of recusal.  Id. Short of amending the guidelines (which doesn’t seem to have happened since 2013) there wasn’t “any way” to “constru[e]” them to allow an MDL judge to engineer his or her own assignment to a specific post-remand case.  Id. at 1055.

Since it was decided in 2014, MFT hasn’t been cited except in the Ninth Circuit – as we suppose befits such an arcane decision.  It may well be, as a commentator has commented, that visiting judge “requests are often granted routinely by circuit chief judges” in MDL situations.  Sherman, “When Remand Is Appropriate in Multidistrict Litigation,” 75 La. L. R. 455, 460 (2014).  However, “intercircuit transfers based on efficiency could encroach on the authority of transferor judges to resume rightful control over their cases upon completion of pretrial proceedings.”  Id.  See MacFarlane, “The Danger of Nonrandom Case Assignment:  How the Southern District of New York’s ‘Related Cases’ Rule Shaped Stop-and-Frisk Rulings,” 19 Mich. J. Race & L. 199, 213 (2014) (“the visiting judge [under §292(d)] would be expected to help relieve that burden, rather than dictate what types and number of cases he or she is willing to hear”).

It may seem extreme that an MDL judge would react to Lexecon – and lack of an appropriate waiver − by seeking to chase the parties back to their home districts, but such an extreme situation is precisely when our clients may feel compelled to invoke MFT to try to end the chase.  We hope our clients never need it, but if they do, remember that the only actual precedent out there rejects letting MDL judges maintain control over cases after remand.

We don’t normally comment on verdicts, whether they favor our side or the plaintiffs, because the bare fact of a verdict doesn’t give us much to analyze, and analysis is what this blog is about. But we make an exception for the bizarre verdict handed down last week in the first bellwether trial in the Bard IVC Filter MDL.

We’ve seen the verdict form, and the plaintiffs submitted four theories of liability to the jury:  (1) strict liability design defect; (2) strict liability failure to warn; (3) negligent design; and (4) negligent failure to warn.  According to the 360 story (unfortunately behind a paywall to non-subscribers), the jury found that the defendant’s IVC filter wasn’t defectively or negligently designed, and – more importantly for our purposes – also held that there was no strict liability warning defect (the case was under Georgia law, and Georgia is a Restatement §402A state).

After having rendered defense verdicts on the first three theories, the IVC jury found that, somehow, the defendant had negligently failed to warn about the same risks as to which there was no strict liability warning defect.

That’s inconsistent, if not impossible.

We haven’t looked at Georgia law, but the exact same thing happened not too long ago in California, in Trejo v. Johnson & Johnson, 220 Cal. Rptr.3d 127 (App. 2017), review denied (Cal. Oct. 11, 2017), a case we blogged about here.  In Trejo, we were mostly interested in the fate of the plaintiff’s design-related claims (they were preempted), but the court also held that, where the jury had determined that no warning-related, strict-liability defect existed, it was inherently inconsistent for the jury to turn around and find negligent failure to warn:

Considering that both the strict liability and negligence theories were premised on a single alleged defect – failure to warn of [the same risk] – the jury’s findings meant, in substance, that [defendant] was not strictly liable for failure to warn of those possible reactions because they created no substantial danger, but was liable for negligent failure to warn because those possible reactions were, or were likely to be, dangerous.  As we next explain, we conclude that these verdicts are fatally inconsistent.

Trejo, 220 Cal. Rptr.3d at 142.

Why is that?  We’ll let the California Court of Appeals explain.

“[A] finding of negligent failure to warn is logically and legally inconsistent with the jury’s finding [in favor of defendants] on plaintiffs’ strict products liability failure to warn.”  Id. (quoting Oxford v. Foster Wheeler LLC, 99 Cal. Rptr.3d 418, 435 (App. 2009)).  That’s because “the manufacturer’s strict liability duty to warn is greater than its duty under negligence, and thus negligence requires a greater showing by plaintiffs.”  Id. (Valentine v. Baxter Healthcare Corp., 81 Cal. Rptr.2d 252, 263 (App. 1999)).

Strict liability was invented precisely so it would be easier to prove than negligence.  Thus a “defense verdict . . . on strict liability failure to warn subsume[d] the cause of action for negligent failure to warn so that” the proper result was “to direct a defense judgment on that negligence count.”  Trejo, 220 Cal. Rptr.3d at 142 (quoting Valentine again).  “[T]he defense verdict on strict liability failure to warn mandated a defense verdict on negligent failure to warn as well.”  Id.

A negligence formulation of a warning claim – that a defendant “has a duty to use reasonable care to give a warning” of a risk that makes the product “likely to be dangerous” to users whom “the supplier has reason to believe . . . will not realize [the product’s] danger,” id. – requires greater proof of failure to warn than strict liability, which allows recovery whenever a “substantial” danger requires a better warning than what the plaintiff (or the physician in a learned intermediary case) received:

[A] product is defective if the use of the product in a manner that is reasonably foreseeable by the defendant involves a substantial danger that would not be readily recognized by the ordinary user of the product and the manufacturer knows or should have known of the danger but fails to give adequate warning of such danger.  A manufacturer has a duty to provide an adequate warning to the user on how to use the product if a reasonably foreseeable use of the product involves a substantial danger of which the manufacturer is either aware or should be aware, and that would not be recognized by the ordinary user.

Id. at 142-43 (mostly quoting Valentine again).  “[T]he strict liability definition of defective product, coupled with . . . the strict liability duty to warn physicians of the potential risks or side effects of [a medical device] that were ‘known or knowable,’ more than subsumed the elements of duty to warn set forth in the negligence instructions.”  Id. at 143.

[T]he ‘known or knowable in light of’ language in the strict liability instruction at a minimum encompasses the ‘knows or has reason to know’ language in the negligence instruction.  Under a negligence standard, a reasonable manufacturer would not be charged with knowing more than what would come to light from the prevailing scientific and medical knowledge.”

Id. at 144 (quoting Valentine again).

The Trejo decision goes on, reviewing other cases in which courts have found inherently inconsistent verdicts where the jury found for the defendant on strict liability warning defect but for the plaintiff on negligent failure to warn.  Id. at 143-48 (discussing, both Valentine, supra (a medical device case), and Oxford, supra at great length).  Trejo also rejected the plaintiff’s attempted counter that “negligence and strict products liability are not identical doctrines”:

True enough − the two theories of products liability are not identical. . . . the difference between strict liability failure to warn and negligent failure to warn [is] . . . that, unlike negligent failure to warn, strict liability is not concerned with the standard of due care or the reasonableness of a manufacturer’s conduct. . . .  [A] manufacturer could be held liable under strict liability principles even if its failure to warn conformed to industry-wide practices and thus was not negligent.  [The law does] not, however, indicate that a manufacturer could be held liable for negligent failure to warn despite being found not liable for strict liability failure to warn.  Indeed, as illustrated by Valentine and Oxford, this cannot be so where, as here, only one viable factual basis supports both theories.

Id. at 148 (citations and quotation marks omitted).

A similar result to Trejo and Valentine was reached decades earlier in Werner v. Upjohn Co., 628 F.2d 848 (4th Cir. 1980):

The effect of the jury verdict on negligence was to find that [defendant] failed to use due care to give an adequate warning of the propensities of the drug marketed, and, in the same breath, the verdict on strict liability found that the drug marketed with such an inadequate warning was not unreasonably dangerous.  The verdicts in the context of this failure to warn case involving prescription drugs are obviously inconsistent and cannot stand.

Id. at 860.  See Witt v. Norfe, Inc., 725 F.2d 1277, 1280 (11th Cir. 1984) (defense verdicts on strict liability and warranty were “irreconcilably contradictory” with plaintiff’s verdict on negligence) (applying Florida law); In re Baycol Products Litigation, 2008 WL 6155700, at *13 (D. Minn. Sept. 22, 2008) (“failure of a plaintiff’s strict liability failure to warn claim, results in the same fate for a plaintiff’s negligent failure to warn claim”), aff’d, 596 F.3d 884 (8th Cir. 2010) (applying California law).

Finally, the irreconcilability of the verdict in IVC Filter may well be a fortiori from the Trejo/Oxford/Valentine cases out of California.   The California law at issue in those cases was crystal clear that, in both negligence and strict liability warning claims, liability is limited by the state of the art defense.  Georgia law, on the other hand, lacks definitive precedent imposing state of the art as a limitation on strict liability.  The closest precedent we have found is McCombs v. Synthes (U.S.A.), 587 S.E.2d 594, 596 (Ga. 2003), a medical device decision recognizing that warning claims generally are held to a “reasonableness” standard.  Thus, strict liability warning claims may be even easier for plaintiffs to prove, compared to negligence, under Georgia law.  That would make the irreconcilability of the IVC Filter verdict for plaintiff on negligence even greater than is the case under Trejo/Oxford/Valentine.

Exactly why the jury in IVC Filter returned such blatantly irreconcilable verdicts is, of course, something we will never know.  From the 360 article, however, we spotted a couple of things that couldn’t have contributed to the mix-up.  First, punitive damages were also at issue in the case.  Our views on the prejudicial nature of evidence relating to that kind of claim are already set forth at some length in our post advocating that MDL defendants limit any so-called “Lexecon waivers” to compensatory damages.  It may well be that prejudicial intent evidence, relating solely to punitive damages, inflamed the jury on the liability question so that even though they could not find that the product was defective, the jury was dead set on finding for the plaintiff anyway.  Don’t know, but certainly plausible.

Second, and possibly related, the 360 article also quotes plaintiffs’ counsel as arguing that the “simple fix” was “[d]on’t put it [the device] on the market.”  To us, that kind of rhetoric is unacceptable because it encourages the jury to disregard the FDA’s decision that initially allowed the product to be marketed.  A claim that a defendant manufacturer should not have sold a product that the FDA has determined should be sold in the United States inherently conflicts with the power that Congress has vested in the FDA specifically to make those decisions.  See Mutual Pharmaceutical Co. v. Bartlett, 570 U.S. 472, 489-90 (2013) (claims “that a regulated actor could avoid liability under both state and federal law by simply leaving the market” held impliedly preempted).  Plaintiffs should never have been allowed to make that sort of appeal to the jury to nullify what the FDA decided.

It seems quite evident that the jury got confused and went astray in the first Bard IVC Filters bellwether trial.  The result was a verdict that can’t logically be a bellwether of anything.  The jury found for the defendant on a warning claim for which the plaintiff had a lesser standard of proof, and then found for the plaintiff on identical warning-related facts where the law required stronger evidence for liability.  That’s what precedent means by “irreconcilable.”

 

We’ve seen the latest affirmance of largely identical verdicts in a consolidated MDL trial in Campbell v. Boston Scientific Corp., ___ F.3d ___, 2018 WL 732371 (4th Cir. Feb. 6, 2018).  We’re not discussing Campbell’s merits today.  For present purposes, suffice it to say that the consolidation- and punitive damages-related rulings aren’t that much different from Eghnayem v. Boston Scientific Corp., 873 F.3d 1304 (11th Cir. 2017), about which we blogged, here.

More generally, both of those cases, as well as the course of the Pinnacle Hip litigation described in several of our prior posts as well as in In re Depuy Orthopaedics, Inc., 870 F.3d 345 (5th Cir. 2017) (“Pinnacle Hip”) (which we discussed, here), illustrate an adverse trend in MDLs.  That trend is to replace the traditional (if anything in MDL practice can be called traditional) bellwether trials with consolidated multi-plaintiff trials including allegations of punitive damages.  We’ve already expressed our jaundiced view towards consolidated product liability trials as inherently prejudicial against defendants, for a variety of reasons discussed in that post.  For obvious reasons, facing punitive damages is likewise not favorable to a defendant in a trial.

As our prior consolidation post discussed at some length, defendants saddled with consolidated trials in personal injury cases used to have reason to expect appellate relief.  Identical or nearly identical verdicts were considered evidence that the jury was either unable to keep multiple individual cases straight or overwhelmed by all the factual evidence, or both.  However, the recent Campbell decision, added to other recent events, makes us believe that the ability to obtain such relief has never been more questionable.

Hence, we offer an idea that has been percolating here ever since the decision in Pinnacle Hip.  We mentioned it at last December’s ACI Drug and Medical Device Litigation conference, and it was received as a good idea by most defense counsel we talked to, so here goes….

Only you can prevent multi-plaintiff consolidated punitive damages trials.

We recognize that such trials cannot always be prevented – this idea wouldn’t have worked in Campbell, for example − but MDL defendants should seriously consider limiting their so-called “Lexecon waivers,” to the extent they are willing to give them at all.

What does that mean?

Basically, Lexecon Inc. v. Milberg Weiss Bershad Hynes & Lerach, 523 U.S. 26 (1998), held that MDL judges can’t try cases transferred to them from another judicial district under the MDL statute, 28 U.S.C. §1407.  They can try cases properly filed in the same judicial district and then transferred to them as related cases (what happened in Campbell), but all other MDL trials require a Lexecon waiver of trial in the original transferor court.

The Fifth Circuit made clear in the Pinnacle Hip decision that a Lexecon waiver, like any other waiver, must be “clear and unambiguous” to be effective. Id. at 351.  Thus, we think it would be a good idea for MDL defendants to tailor any future Lexecon waivers so that they apply only to single-plaintiff trials, and exclude punitive damages.  As for consolidation, a Lexecon waiver excluding consolidation simply preserves the manner in which cases have been tried, including MDL bellwethers, for decades or longer.  As for punitive damages, bifurcating out such allegations has been commonplace in asbestos litigation, and has been employed in other mass torts as well, such as opt out cases in the Diet Drug litigation.

Even if courts seem less inclined to recognize it, everyone on the defense side knows how prejudicial multi-plaintiff consolidations and punitive damages allegations are during trials. To the extent possible, defendants should consider self-help, in the form of limited Lexecon waivers, to prevent such prejudicial procedures.

On January 30, 2018, Judge Goodwin entered four case management orders in the Ethicon, Boston Scientific, Bard, and American Medical Systems mesh MDLS.  These CMOs establish discovery and briefing deadlines for 13200, 6174, 2876, and 952, cases respectively – a total of 23202 cases.

The discovery and briefing schedules are identical in all four orders. The deadlines are:

Plaintiff Fact Sheets.                                                              03/19/2018

Defendant Fact Sheets.                                                          04/19/2018

Deadline for written discovery requests.                                05/18/2018

Expert disclosure by plaintiffs.                                               06/04/2018

Expert disclosure by defendants.                                           07/05/2018

Expert disclosure for rebuttal purposes.                                 07/23/2018

Deposition deadline and close of discovery.                          09/04/2018

Deadline to file list of general causation experts.                   09/11/2018

Filing of Dispositive Motions.                                                09/21/2018

Response to Dispositive Motions.                                          10/05/2018

Reply to response to dispositive motions.                              10/12/2018

Filing of Daubert motions.                                                      10/05/2018

Responses to Daubert motions.                                              10/19/2018

Reply to response to Daubert motions.                                   10/26/2018

In addition to the plaintiff’s deposition, the parties may take up to 4 treating physician depositions. See Paragraph two of the orders.  Depositions of friends and family are not subject to these deadlines. Id. Depositions are limited to three hours (both sides), absent other agreement of the parties. Id.

Assuming that each plaintiff timely files a fact sheet by the March 19 deadline, that means that the defendants have 167 days thereafter in which to schedule depositions. Assuming an average of three treating physician depositions (at least one implanting surgeon, at least one post-injury treater, and an additional from either of those categories) per case, that means about four depositions in each of 23202 cases, for a total of some 92,808 depositions.  Spread equally across the 167 days after defendants learn the nature of each plaintiff’s case, and who the plaintiffs’ physicians are – the parties are being ordered to take approximately 556 depositions each day.

This 556 deposition per day figure does not count depositions of other witnesses, such as sales representatives, friends and family, and expert witnesses. Nor does it address preparation of each side’s fact sheets, and motion practice, all of which are now scheduled in the 23202 cases that are the subject of the four mesh CMOs.

Good luck to all – you’ll need it.

In the mass torts world in which we find ourselves, glimmers of jurisprudential light can seem few and far between. Two things we love are good warnings causation decisions and sneaky plaintiffs getting caught at their own games.  Today’s case has both.  In Thompson v. Janssen Pharm., Inc., 2017 WL 5135548 (C.D. Cal. Oct. 23, 2017), the court considered simultaneous motions:  the plaintiffs’ motion for voluntary dismissal without prejudice and the defendants’ motion for summary judgment.

The plaintiff began taking Risperdal in 2001 after he was diagnosed with tics and other disorders, and he alleged that the drug caused him to develop gynecomastia (breast enlargement). Nevertheless, he continued – and continues – to take Risperdal (sixteen years, five doctors, and counting) because it effectively controls his tics, notwithstanding his alleged gynecomastia, his lawsuit, and his doctor’s recommendation that he stop taking the drug.

The Plaintiffs’ Motion for Voluntary Dismissal without Prejudice

The plaintiffs sued in the Central District of California, asserting the usual litany of claims. One day before the defendant moved for summary judgment, the plaintiffs moved for voluntary dismissal without prejudice so they could re-file their case in state court and park it in the already-existing JCCP, California’s version of an MDL.  They claimed that, though they had “been diligently seeking discovery” to prove their case, they were “unable to do so effectively” in federal court. Thompson, 2017 WL 5135548 at *4.

The court explained that factors relevant to its decision included: 1) the opposing party’s effort and expense in preparing for trial; 2) excessive delay and lack of diligence by the moving party in prosecuting the action; 3) insufficient explanation of the need for dismissal; and 4) the fact that the opposing party has moved for summary judgment. Id. at *5 (citations omitted).  Naturally, the plaintiff argued that all of these factors weighed in favor of granting the motion, but the court disagreed.

The court pointed out that, though the plaintiffs argued that they had been diligent in prosecuting his case, they had “failed to serve expert disclosure or expert reports.” Id. at *6.  Moreover, through the plaintiffs’ motion was “purportedly premised on their intention to join the pending state court [Risperdal litigation],” they gave “no explanation as to why they waited until . . . mere days before the summary judgment deadline” when they had notice of the state court litigation for more than a year. Id. The court concluded that this was “an insufficient explanation of the need for dismissal,” one of the factors to be considered. Id. (internal punctuation omitted).

In addition, though the defendants’ motion for summary judgment was not pending when the plaintiffs filed their motion (it was filed the next day), the defendants had notified the plaintiffs that they would be filing for summary judgment before the plaintiffs moved for dismissal. The court held that “the proximity of the two motions raise[d] the inference that that Plaintiffs’ motion might have been motivated by a desire to . . . avoid an imminent adverse ruling by way of Defendants’ summary judgment motion and also avoid the consequence of their failure to serve expert disclosures.” Id. (internal punctuation and citation omitted).

Simply put, as the court correctly perceived, the plaintiffs’ tactic was a transparent attempt to hide their meritless case in another mass proceeding on the chance that an inventory settlement would line their pockets at some point down the road.  The court concluded, “. . . Plaintiffs have not provided sufficient justification for voluntary dismissal given the untimeliness of the request and the proximity to Defendants’ motion for summary judgment.” Id.  Motion denied.

The Defendants’ Motion for Summary Judgment

It was undisputed that all of the plaintiffs’ claims were premised on the defendants’ alleged failure to warn about the rate of gynecomastia. As such, the defendants argued that all of the plaintiff’s claims failed because, inter alia: 1) the plaintiff assumed the risk by continuing to take the drug once he was aware of the alleged risk; and 2) the plaintiff could not prove “warnings causation;” in other words, he could not satisfy his burden of proving that that a different warning would have changed his doctors’ decisions to prescribe the drug for him. Id.

As to assumption of the risk, the defendants argued that the plaintiff was aware of the risk of gynecomastia but “continues to use Risperdal because he believes the benefits of the medicine in treating his condition outweigh the very risks that he has sued upon.” Id. at *7 (citation omitted).  The court disagreed, holding that the record did not clearly indicate that the plaintiff’s treating physicians discussed the risk of gynecomastia with the plaintiff.

But it was clear, on the record, that all of the plaintiff’s prescribing physicians were themselves aware of the risk of gynecomastia. And the plaintiff “provided no evidence that a different warning would have altered the physicians’ decisions to prescribe Risperdal.”  Therefore, the plaintiff could not “demonstrate the [warnings] causation required to survive summary judgment under California’s learned intermediary doctrine.” Id. at *8.

Nor were the plaintiffs’ claims saved by California’s “overpromotion exception.” As the court explained, “California courts have in the past recognized that the learned intermediary doctrine may not apply where a medication has been overpromoted to the extent that any warnings would have been nullified.” Id. at *9 (citation omitted).  But the overpromotion exception applies only in “unusual cases” (our California colleagues tell us that it is very rarely applied), and not “where a plaintiff’s prescribing physician did not rely on promotional statements when choosing treatment options.” Id. (citation omitted).  In this case, there was no evidence that any of the plaintiff’s prescribers relied on the defendant’s promotional activities, and the exception did not apply.

And so, in the absence of evidence of warnings causation, the court granted summary judgment for the defendants. The correct result, and a nice cautionary tale for plaintiffs thinking they can game the system, ignore both rules and law, and await the filling of their outstretched hands.  Does our defense heart good.

As we write this, our fair city remains in a blissful haze following our Eagles’ 33-10 rout of the 49’ers to go 7-1 in the NFC East, so it might be appropriate to call today’s opinion a “touchdown.” On the other hand, the World Series approaches Game 6, following a game in which twenty-five runs were scored.  So maybe the opinion is a “home run.”  In any event, the Second Circuit’s (regrettably) unpublished affirmance in In re Mirena IUD Prods. Liab. Litig., Mirena MDL, Plaintiffs v. Bayer Healthcare Pharmaceuticals, Inc., 2017 U.S. App. LEXIS 20875 (2d. Cir. Oct. 24, 2017) is very, very good.

More than a year ago , we reported that the United States District Court for the Southern District of New York granted the defendant’s motion to exclude the plaintiffs’ general causation expert in the Mirena MDL.  In the absence of expert causation testimony, the court granted summary judgment for the defendant on all pending cases, holding that the plaintiffs could not satisfy their burden of proof without expert causation testimony.  The plaintiffs appealed to the Second Circuit.

Mirena is an implanted intrauterine birth control device. (As we have commented before, plaintiff lawyers persist in choosing contraceptive devices as their targets, despite the general absence of any basis for the plaintiffs’ claims.)  The Mirena MDL plaintiffs alleged that they were injured when their Mirena devices perforated their uteruses.  As the Court explained, “At bottom, the [Mirena] MDL is about when Mirena perforated Plaintiffs’ uteruses.  Both parties agree – and [the defendant] has warned – that Mirena can injure a woman’s uterus during insertion and afterward migrate outside the uterus (what is called “primary perforation”). Mirena, 2017 U.S. App. LEXIS 20875 at *2 (emphasis in original).  But the plaintiffs alleged that their Mirena devices perforated and migrated outside their uteruses at some later time (so-called “secondary perforation”).  The defendant did not warn of “secondary perforation,” so, the Court stated, it was “exposed to liability if secondary perforation in fact occurred.” Id.

The plaintiffs offered three general causation experts to testify that secondary perforation was possible. The District Court excluded all three pursuant to Daubert, holding that their testimony was “not reliable and, thus, not helpful to the trier of fact.”

Affirmance of Exclusion of Plaintiffs’ General Causation Experts

On review of the District Court’s Daubert decision, the Second Circuit focused on three “particularly noteworthy” problems with the opinions of the plaintiffs’ experts. Id. at *5.  First, the experts’ theories were not accepted in the relevant scientific community. “Not only [did] the experts fail to identify any authorities that directly support the existence of secondary perforation, but what scientific authority there is casts doubt on the phenomenon’s existence.” Id. Second, all of the experts developed their “secondary perforation” theories solely for purposes of the litigation and lacked in the supposed phenomenon before the litigation began.  One had no specialized expertise in Mirena or uterine perforation before being hired, one had no experience with IUDs, and the third “had not even heard of secondary perforation before consulting in the litigation.” Id. at *8.  Third, “finding no direct support in the literature for secondary perforation and having conducted no prior research on the subject, the experts all assumed the existence of the very phenomenon in dispute and then hypothesized how it could occur.” Id.

In response to the third point, the plaintiffs argued that their experts were no different than experts in Kumho Tire v. Carmichael, 526 U.S. 137 (1999), who were asked to determine the mechanism that caused the blowout of a tire.  The Court gave this argument the back of its figurative hand, emphasizing, “. . . [I]n Kumho, there was no dispute about whether the tire had blown, only how it happened. . . . Here, by contrast, the parties dispute whether the secondary perforation has ever occurred.  The experts thus begged the very question they were trying to answer.”   Id. (citations omitted).

And so the Court affirmed the exclusion of all three general causation experts.   Next, the Court considered whether the plaintiffs could escape summary judgment despite the lack of expert causation testimony.

Affirmance of Summary Judgment for Defendants

Arguing that their cases could survive the exclusion of their experts, the plaintiffs “identif[ied] dicta from several cases suggesting that party admissions can sometimes substitute for expert testimony on general causation.” Id. at *9-10.  The plaintiffs proffered four categories of such supposed admissions:

  • Three short excerpts of emails authored by the defendant’s employees that purportedly “admitted” that secondary perforation could occur. But the excerpts were from emails in which the employees “reported, without necessarily endorsing, adverse event reports,” which, as a category, are “anecdotal, and thus of very limited probative value.” Id.
  • One sentence from a PowerPoint presentation suggesting that spontaneous perforation could occur unrelated to insertion. The Court agreed with the District Court that, with no knowledge of the context in which the slide was presented or what was said at the meeting, and no details of any causes of the supposed secondary perforation, the excerpt could not substitute for expert testimony.
  • Testimony from the defendant’s Global Medical Expert that “a perforation unrelated to insertion, rare as it may be . . . could happen.” The Court held that “acknowledgment of the possibility of causation does not establish that causation is more likely than not, as the District Court correctly found.” Id. at *11.
  • In 2014, the defendant changed the Mirena label to warn that perforation “may occur most often during insertion, although the perforation may not be detected until sometime later.” The plaintiff’s argued that this was an admission that secondary perforation could occur, but the Court observed that “the grammatical structure [of the warning was] cryptic at best,” at most “suggest[ing] the hypothetical possibility of secondary perforation,” and could not substitute for expert testimony. Id. at *11-12.

And so, the Court held, “We need not reach the question of whether party admissions could ever substitute for expert testimony.   Assuming arguendo that they could, the putative admissions proffered by Plaintiffs are simply not enough to establish general causation.” Id. at *10.  Summary judgment for the defendant affirmed.

Daubert embodies real standards. And the Rules of Evidence are more than suggestions.  In this case, in the hands of a decisive District Court, both contributed to a decision that was unassailable on appeal.  We will keep you posted on similar – and hopefully published – decisions.