This guest post is by Reed Smith associate Lora Spencer, who (as you might suspect) calls Texas her home.  In her first rodeo on the blog, she discusses a recent MDL decision that she thinks is a few pickles short of a barrel, and hopes it’s not a harbinger of things to come.  Not exactly a conniption fit, but close.  As always our guest posters deserve 100% of the credit (and any blame) for what they write.

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“Everything is bigger in Texas”—or is it? The plaintiffs in Aron v. Bristol-Myers Squibb, 2018 U.S. Dist. LEXIS 39146 (S.D.N.Y. Mar. 9, 2018), would have y’all believe that pharmaceutical manufacturer tort liability, at least, is bigger in Texas.  But, first, before getting to this “Texas Expansion,” here are some interesting “reported” facts about Texas.  Pay attention, there may be a pop quiz, if not now, perhaps at your next networking event.  Knowing such factoids will surely make your “lone star” shine brightly.

Texas is a really BIG state. Texas is ranked 2nd in the country in population and size.  Texas’s total area is twice the size of Germany (albeit half the size of Alaska).  Of 45 United States presidents – three of them hail from Texas—all of them since 1963, hence the slogan “read my lips, no new Texans.”  King Ranch, located in south Texas, is considered “the birthplace of Texas ranching” and is larger than Rhode Island.  Texas also has the most rattlesnakes of any state.  And the weight of the catfish consumed by Texans each year exceeds that of the Paris Eiffel Tower (at least the one in Texas).  “Texas is just too big,” said no Texan ever.  Apparently Aron takes the same view.

Aron purported to apply Texas law in what appears to be the first reported opinion from the Farxiga MDL.  Maybe future opinions will be better.  Aron denied the defendants’ motion to dismiss plaintiffs’ amended complaints under Rule 12(b)(6).  Id. at *9.  Farxiga has only one labeled indication—lowering blood glucose in adults with type 2 diabetes.  Id.  Because everything is bigger in Texas, so is the complaint, which included three Texas plaintiffs with no business being joined in the same complaint.  Getting a free pass on misjoinder, these three plaintiffs brought “causes of action claims, under Texas law, based on the defendants’ failure to warn of [drug] risks …, negligent testing, and gross negligence.” Id. *16.

Failure to Warn

The most important thing about Texas product liability law is that most of it is now statutory.  Under Texas law, in a products liability suit, a statutory presumption precludes a defendant drug manufacturer from being liable for failure to warn claims if its warnings were approved by the Food and Drug Administration (FDA).  Texas Civ. Prac. & Rem. Code Ann. § 82.007.  However, a plaintiff may rebut this presumption by establishing one or more of five statutory exceptions.  Id. at (b)(1-5).

In Aron, the relevant exceptions were § 82.007 (b)(1) and (3).  2018 U.S. Dist. LEXIS 39146, at *17.  Section (b)(1) allows a plaintiff to rebut the presumption by proving fraud on the FDA—that “the defendant, before or after pre-market approval … withheld from or misrepresented to the [FDA] required information that was material and relevant to the performance of the product and causally related to the claimant’s injury.”  Civ. Prac. & Rem. § 82.007(b)(1).  Section (b)(3) avoids the presumption if the plaintiff can show off-label promotion – that “the defendant recommended, promoted, or advertised the pharmaceutical product for an indication not approved by the [FDA], the product was used as recommended, promoted or advertised; and the claimant’s injury was causally related to the recommended, promoted, or advertised use of the product.”  Id. at (b)(3).

As regular blog readers know, a claim predicated on fraud on the FDA should be preempted. Buckman Co. v. Plaintiffs Legal Committee, 531 U.S. 341 (2001).  Unsurprisingly, the defendants argued the FDA fraud exception is preempted by federal law. Aron, 2018 U.S. Dist. LEXIS 39146, at *20.  The court noted conflicting Fifth and Second Circuit decisions concerning § 82.007(b)(1) and a similar Michigan statute. Compare Lofton v. McNeil Consumer & Specialty Pharms., 672 F.3d 372 (5th Cir. 2012) (applying Texas law) (discussed here), with Desiano v. Warner Lambert & Co., 467 F.3d 85, 95 (2d Cir. 2006) (applying Michigan law), aff’d by equally divided court, 552 U.S. 440 (2008).  However, because the plaintiffs did not plead the fraud exception with “sufficient particularity,” Aron did not decide the preemption issue.  Id. at *21.  Given the other rulings in Aron, its punting on preemption is probably just as well.  In true Texas fashion, Hi-Yo Silver away!  The plaintiffs failed to rebut the presumption using §82.007 (b)(1). Id.

However, fraud on the FDA is only one of § 82.007’s five exceptions.  Properly raising any one of them will get a plaintiff past a presumption-based motion to dismiss.  Id. at *17.  Plaintiffs got away with pleading the “off-label” marketing exception, under § 82.007 (b)(3). Id. at *20.  Plaintiffs alleged:  (i) defendants promoted Farxiga to prescribing physicians for off-label uses, specifically obesity and hypertension, (ii) such off-label promotion caused the physician to prescribe Farxiga for off-label use, (iii) plaintiffs used Farxiga for off-label purposes, and (iv) off-label use caused the plaintiffs injuries.  Id. at *20-22.  Plaintiffs cited press releases, advertisements, and clinical trial protocols to support their claim that off-label marketing occurred.  Id.  However, Aron failed to discuss the pleading of causation  Not one of the various off-label statements was linked to any particular prescriber, let alone to a prescription that caused these plaintiffs’ injuries.  Never mind that physicians may, and often do, prescribe drugs for unapproved uses as part of their practice of medicine.  Aron let the plaintiffs slide on causation.  All hat and no cattle.

Negligent Testing

Aron also allowed the plaintiffs’ negligent failure to test claim to stand.  2018 U.S. Dist. LEXIS 39146, at *22.  The plaintiffs alleged the defendants negligently failed to test Farxiga thoroughly before releasing the drug into the market, failed to analyze pre-market test results, and failed to conduct sufficient post market testing and surveillance.”  Id. at *23.  Defendants argued the plaintiffs’ negligent testing claim is “inextricably intertwined” with the plaintiffs’ failure to warn claim and is inadequately pleaded. Id. The Fifth Circuit, applying Texas law, has so held—twice.  “[A] negligent testing claim is, as a matter of Texas law, a variation of an action for failure to warn.” Dow Agrosciences LLC v. Bates, 332 F.3d 323, 333 (5th Cir. 2003) (applying Texas law), reversed on other grounds, 544 U.S. 431 (2005) (preemption).  Plaintiff’s “negligence claims, such as the alleged failure to adequately test [the product], are subsumed within” a failure to warn claim. Skotak v. Tenneco Resins, Inc., 953 F.2d 909, 912 n.5 (5th Cir. 1992) (applying Texas law).

Even though Fifth Circuit law should have controlled on this point of state law, Aron chose to follow cases that it asserted recognized “an independent cause of action based on negligent failure to test.”  Id. at *22-23.  The most significant of the three, Am. Tobacco Co. v. Grinnell, 951 S.W. 2d 420 (Tex. 1997), certainly did not.  Rather, the Texas Supreme Court’s holding was quite the opposite:

[Plaintiff’s] negligent testing claim is predicated on [defendants’] duty to test and ascertain the dangers inherent in its products about which it must warn consumers.  Because the negligent testing claim is inextricably intertwined with the [plaintiffs’] negligent failure to warn claim, we hold that summary judgment was also proper on this claim.

Id. at 437.  “Inextricably intertwined” is about as far from “an independent cause of action” as you can get.  Of the other two cases, Murthy v. Abbott Laboratories, 847 F. Supp.2d 958 (S.D. Texas 2012), is notorious for improperly construing Texas law.  The other, Romero v. Wyeth Pharmaceuticals, Inc., 2012 WL 12547449, at *4 (E.D. Tex. Aug. 31, 2012), essentially followed Murthy. Aron is another instance of improper federal court judicial activism attempting to push state (Texas) law where no state court has ever gone.

Gross Negligence

Apparently, in Texas, it is not enough just to plead negligent testing. The plaintiffs also pled gross negligence.  2018 U.S. Dist. LEXIS 39146, at *24.  The defendants argued that “[i]t is merely a restatement of plaintiff’s deficient negligence count.” Id.  However, Aron looked to the elements of gross negligence, and held the plaintiffs sufficiently pled facts to support an inference of gross negligence.  Id. at *25.  Those facts oddly included a September 2013 “post market” study.  Id. at *26.  Supposedly, the defendants “terminated” that study in “2013 without posting any results.”  Id. at *9.  However, the FDA did not approve Farxiga until January 8, 2014. Id. at *9.  That does not sound like gross negligence, but rather a preempted fraud on the FDA claim.  Whether or not anything was “posted,” the alleged study termination occurred before the FDA’s approval of this product, so the only reporting duty was imposed by federal law—not Texas law—and it ran to the FDA.  Any public “posting” of product-related information before FDA approval would illegally promote an unapproved product, which almost certainly explains lack of any such post.

With Aron, the Farxiga MDL is not exactly off to a good start.  Will this be another instance of MDL abuse in the making?  Saddle up, and get ready for a wild ride, the prominent phrase “Everything is BIGGER in Texas” is unfortunately reflected in Aron’s approach to product liability.

Once again we find ourselves in the position of creating new defenses to a novel, plaintiff-side cause of action.  This time, we’ve been doing a lot of thinking about innovator liability – the theory that would hold branded manufacturers liable for injuries allegedly caused by the ingestion of (preemption-immune) generic drugs on some kind of attenuated inadequate warning theory – since even before the California Supreme Court’s T.H. v. Novartis, Inc., 407 P.3d 18 (Cal. 2017), decision late last year.  If your company or your clients are concerned about being a target of such theories, here are some ideas we’ve come up with that might help.

Direct Preemption

In T.H., the “major, and ultimately most important, consideration under California law is the foreseeability of physical harm.”  407 P.3d at 29 (citations and quotation marks omitted).  What did T.H. have to say about “foreseeability” in deciding to create a new negligence duty on non-manufacturing branded manufacturers?  The manner in which T.H. construed “foreseeability” was much different than in the normal negligence case:

[A branded drug manufacturer] could reasonably have foreseen that deficiencies in its [product’s] label could mislead physicians about the safety of [the drug’s] generic bioequivalent, which was legally required to bear an identical label.

A brand-name pharmaceutical manufacturer has a duty under federal law to draft, update, and maintain the warning label so that it provides adequate warning of the drug’s potentially dangerous effects. . . .  [T]his category of manufacturers may use the “changes being effected” . . . regulation to “add or strengthen a contraindication, warning, precaution, or adverse reaction” immediately upon filing a supplemental application, without waiting for FDA approval.

The duty for a manufacturer of generic drugs, on the other hand, is to ensure that its warning label is identical to the label of the brand-name drug. . . .

What a brand-name manufacturer thus knows to a legal certainty is that any deficiencies in the label for its drug will be perpetuated in the label for its generic bioequivalent.

Id. (numerous regulatory citations omitted) (emphasis added).

T.H. thus grounded its duty (to be distinguished from breach) analysis, not on the likelihood that the defendant would have violated some common-law obligation, which is the usual way foreseeability is analyzed – but on the likelihood that the defendant would be compliant with its federal obligations under the FDCA.  Indeed, T.H. suggests that, but for this federal overlay, it would not have recognized a new duty at all.  Id. at 31 n.2 (were there “parity between NDA [branded] holders and ANDA [generic] holders with respect to submission of . . . safety-related labeling changes based on newly acquired information,” that could “justify reweighing of the [duty] factors and some reconsideration of the brand-name manufacturer’s duty in this category of cases”).

There is a second element to T.H.’s foreseeability analysis, and that also involves compliance (as opposed to violation) with legal obligations:

A brand-name manufacturer will also be aware that although the warnings communicated in its drug label are designed for physicians . . . it is often the pharmacist who actually decides whether the patient receives the brand-name drug or its generic bioequivalent.  Moreover, many insurance companies require the substitution of a generic drug for the brand-name drug as a matter of course. . . .  Accordingly, it is entirely foreseeable that the warnings included (or not included) on the brand-name drug label would influence the dispensing of the generic drug, either because the generic is substituted by the pharmacist or the insurance company after the physician has prescribed the brand-name drug, or because the warning label on the generic drug is legally required to be identical to the label on the brand-name drug.

Id. at 29-30.

The same unusual reliance on compliance with – rather than violation of – federal and other legal requirements governing the marketing of prescription drugs occurred in Rafferty v. Merck & Co., 92 N.E.3d 1205 (Mass. 2018):

[I]n the vast majority of such cases, the duty to warn would be limited to the manufacturer of the product − even if the plaintiff were to bring a general negligence claim − because the risk of harm arising from an inadequate warning would be foreseeable to a manufacturer only with respect to users of its own product, not the users of another product. . . .  Moreover, apart from any duty arising from the risk of foreseeable injury, only in rare cases could a plaintiff contend that his or her injury was caused by the inadequate warning given for another product.

But this case presents an exception to the usual pattern. Because the Hatch–Waxman amendments to the act require that the warning label of a generic drug be identical to the warning label of its brand-name counterpart . . . duty to warn claims involving generic drugs are potentially viable as general negligence claims, although not as products liability claims.  With generic drugs, it is not merely foreseeable but certain that the warning label provided by the brand-name manufacturer will be identical to the warning label provided by the generic manufacturer, and moreover that it will be relied on, not only by users of its own product, but also by users of the generic product.

92 N.E.3d at 1214-15 (once again omitting a passel of regulatory citations) (emphasis original).  And again the branded defendant’s compliance with the FDCA was the basis for this unique extension of duty to a non-manufacturer:

Federal labeling requirements for generic drugs present precisely the kind of “special circumstance” where a consumer would rely on the warnings created by someone other than the manufacturer of the product causing the injury. . . .  Where a brand-name drug manufacturer provides an inadequate warning for its own product, it knows or should know that it puts at risk not only the users of its own product, but also the users of the generic product.  Consequently, this is the rare (perhaps the only) type of case involving a manufactured product where the requirements of general negligence may be satisfied even where the requirements of products liability are not.

Id. at 1215 (emphasis added).

Plainly, innovator liability amounts to the imposition of a singular and burdensome form of non-manufacturing negligence liability predicated on the branded defendant’s compliance with its obligations under the FDCA – specifically the Hatch-Waxman requirement that it allow generic manufacturers to copy its labeling word-for-word.

Basing liability expressly on a branded manufacturer’s compliance with federal law should give rise to impossibility preemption.  This observation goes back to the oldest FDCA preemption case on the books, McDermott v. Wisconsin, 228 U.S. 115 (1913), where a state’s attempt to prohibit a product because its label complied with the FDCA, rather than with state law, was held preempted.  Even in 1913, it was “well settled that the state may not, under the guise of exercising its police power or otherwise, . . . enact legislation in conflict with the statutes of Congress passed for the regulation of the subject, and if it does, to the extent that the state law interferes with or frustrates the operation of the acts of Congress, its provisions must yield to the superior Federal power given to Congress by the Constitution.” Id. at 131-32 (citations omitted) (emphasis added).

The modern way of expressing the proposition recognized in McDermott is that “state and federal law conflict where it is ‘impossible for a private party to comply with both state and federal requirements.’” PLIVA, Inc. v. Mensing, 564 U.S. 604, 618 (2011) (quoting Freightliner Corp. v. Myrick, 514 U.S. 280, 287 (1995)).  “Even in the absence of an express pre-emption provision, the Court has found state law to be impliedly pre-empted where it is ‘impossible for a private party to comply with both state and federal requirements.’” Mutual Pharmaceutical Co. v. Bartlett, 570 U.S. 472 (2013) (quoting English v. General Electric Co., 496 U.S. 72, 79 (1990)).

That’s, frankly, pretty blatant here, since (as just demonstrated) compliance with federal law is the sine qua non of extending a warning-related duty to the non-manufacturing, branded-drug defendant in both T.H. and Rafferty.  Since innovator liability is explicitly based on the fact of the branded manufacturer’s compliance with what Hatch-Waxman requires, it cannot avoid being preempted, because the entire theory flows from the premise that meeting FDCA requirements about allowing generic use of its labels equals foreseeability, indeed “certainty.”

There are undoubtedly numerous other precedents expressing the same concept, but even the most anti-preemption courts recognize that tort law cannot penalize compliance with federal law.  Take the Seventh Circuit in Bausch v. Stryker Corp., 630 F.3d 546 (7th Cir. 2010), one of the most virulently anti-preemption decisions we can think of.  Bausch was adamant that preemption (express, in that case) precludes “claims that the [product] at issue ‘violated state tort law notwithstanding compliance with the relevant federal requirements.”  Id. at 552 (quoting Riegel v. Medtronic, Inc., 552 U.S. 312, 330 (2008)) (emphasis original in Bausch).  Innovator liability, which equates “foreseeability” with the branded defendant’s “compliance with the relevant federal requirements,” is worse than even the claims Bausch recognized would be preempted, because state-law innovator liability exists because of, not merely “notwithstanding,” a defendant’s FDCA compliance.

Lack of Personal Jurisdiction

Next, we invite you to consider personal jurisdiction in innovator liability cases in light of Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017) (“BMS”).  In a prescription drug product liability case, BMS held that there was no specific jurisdiction over a plaintiff’s claim just because the same defendant allegedly sold the same drug to other, in-state residents, causing similar injuries:

The mere fact that other plaintiffs were prescribed, obtained, and ingested [the drug] in California − and allegedly sustained the same injuries as did the nonresidents − does not allow the State to assert specific jurisdiction over the nonresidents’ claims.  As we have explained, “a defendant’s relationship with a . . . third party, standing alone, is an insufficient basis for jurisdiction.”

BMS, 137 S. Ct. at 1781 (quoting Walden v. Fiore, 134 S.Ct. 1115, 1123 (2014)).  Rather, “case-linked” personal jurisdiction requires case-linked conduct by the defendant within the jurisdiction.  “Nor is it sufficient − or even relevant − that [the defendant] conducted [activities] in California on matters unrelated to [its product].  What is needed − and what is missing here − is a connection between the forum and the specific claims at issue.”  Id.  It was dispositive in BMS that “all the conduct giving rise to the [plaintiffs’] claims occurred elsewhere.”  Id.

Now, consider the conduct alleged to give rise to innovator liability.  It is not the sale of any product, let alone sale of the product that allegedly injured the plaintiff in the jurisdiction where the plaintiff brings suit.  Rather:

Plaintiffs further allege that [the branded defendant] knew or should have known that [the drug] was of questionable efficacy . . ., that [the drug] carried serious risks of side effects for [persons such as plaintiff], and that federal law required [defendant] to report this information to the FDA and to update the warning label − something [it] could have done unilaterally.  Instead, [the branded defendant] falsely represented that [the drug] was safe and effective and would not cause serious side effects in newborns, and it intended for pregnant mothers and their physicians to rely on these representations.

T.H., 407 P.3d at 26.  See Rafferty, 92 N.E.3d at 1212 (similar allegations that the branded defendant “not changed its label” to include a relevant risk that it was warning about overseas).

Under BMS, where does the “case-linked” conduct of branded defendant take place in an innovator liability case?  That conduct does not include sale of a product.  The defendant did not sell the allegedly injurious product, but only a different bioequivalent product with the same risks.  Sale of a different product to different people, even if those other people are in-state residents, can’t support specific, “case linked” personal jurisdiction.  That’s what BMS was all about, only BMS involved the same product, not a bioequivalent generic.  Further, since a branded defendant did not sell the injurious product, there’s not even an arguable basis for “stream of commerce” jurisdiction in innovator liability cases.

Rather, the alleged failure to warn, the alleged knowledge of undisclosed risks, and the alleged failure to bring this information to the attention of the FDA (or to consumers) occurred, if at all, at the principal place of business of the defendant.  Unless the branded defendant in an innovator liability case has the misfortune of being “at home” in the state permitting that theory, there is no basis for “case linked” personal jurisdiction under BMS, because no case-linked conduct occurred that also constituted the necessary “purposeful availment” of the jurisdiction where the plaintiff was allegedly injured by ingesting a generic drug resided.  Further, Daimler AG v. Bauman, 571 U.S. 117 (2014), teaches that there can be no general personal jurisdiction under the same facts, unless the branded defendant was either incorporated or had its principal place of business in the state where suit is brought.

No case-linked jurisdiction due to lack of case-related in-state conduct, combined with the defendant not being “at home” for general jurisdiction purposes, means that there can’t be personal jurisdiction over a branded defendant sued for no reason other than the plaintiff being injured in a state recognizing innovator liability.  Branded defendants should raise personal jurisdiction as a defense – remember, personal jurisdiction is waivable.

This jurisdictional insight is the reason we invited the guest post a few weeks ago by Blank Rome’s Terry Henry.  He was the first person (other than Bexis) whom we saw articulate this argument – and he got around to writing about it before we did.

The second act of the personal jurisdiction defense to innovator liability occurs when the plaintiff is forced to bring suit in the state where the defendant is “at home.”  That sets up choice of law as another hoop for plaintiff to jump through. Historically, almost all states have limited product liability (even under fraud-based theories) to the manufacturer of the product that allegedly produced the plaintiff’s harm.  Fewer, but still quite a few, states have product liability statutes that expressly impose this requirement (sometimes referred to as “product identification”).  Think back to how plaintiffs, during the brief period that West Virginia rejected the learned intermediary rule, attempted (with some success) to claim that West Virginia “public policy” overrode any other choice of law principles and precluded reliance on the differing law of a plaintiff’s home state?   We described that situation here.  Well, that same “public policy” exception to choice of law analysis, see Restatement (Second) of Conflict of Laws §187(2)(b) (1971) (discussing this aspect of the law), can be utilized by branded defendants to argue that allowing innovator liability would offend the law of the defendant’s “home” state, thus rendering the theory entirely unavailable.  If there’s a statutory basis for this home state public policy, then so much the better, but even states without such statutes (Pennsylvania is one of those) probably have long-established precedent saying something like this:

The underlying purpose of [strict liability] is to ensure that the costs of injuries resulting from defective products are borne by the manufacturers that put such products on the market rather than by the injured persons who are powerless to protect themselves. . . .  [T]he burden of injuries caused by defects in such products should fall upon those who make and market the products and the consuming public is entitled to the maximum of protection.

Miller v. Preitz, 221 A.2d 320, 334-35 (Pa. 1966).  That’s a pretty solid iteration of state “public policy” that product liability is intended to be borne by manufacturers of injurious products.

So consider raising personal jurisdiction as an issue against plaintiffs making innovator liability claims. There’s more than one way to skin a cat.

Setting up a Prophylactic Preemption Defense

The potential scope of innovator liability is so massive that it may require branded companies to reconsider how they carry out certain aspects of their business.  We’re sure most such companies review their warnings in strict compliance with FDA requirements and guidance concerning analysis of signals from medical literature and adverse events, with full recognition that, first, overwarning is a bad thing and, second, voluntarily reported adverse events, by themselves aren’t proof of causation.

If innovator liability catches on, then potential defendants might want to consider changing those time-honored practices at two critical moments:  (1) when entry of generic products into the market is imminent, and (2) when a decision is made to sell the new drug application of a drug having generic counterparts.  When #1 happens, the commercial considerations that reinforce strict compliance with FDA warning standards weaken, because a significant loss of market share is inevitable.  When #2 happens, the potential defendant is about to lose any control over drug labeling, since only NDA holders can file NDA supplements.  Number 2 would, of course, be in addition to any indemnification or similar provisions in the contract selling the NDA.

In those situations, companies that fear being targeted by innovator liability might want to pull every possible “signal” or statistical anomaly they can find in their data and submit these purported “risks” to the FDA for its independent evaluation − even if, objectively, the company does not believe that the data otherwise justify a “changes being effected” labeling change of the sort mentioned in T.H. or Rafferty.  Let the FDA be the one to say “no.”  If the FDA doesn’t like this, let the agency take regulatory steps to prohibit innovator liability.

Why?

The FDA saying “no” – that the scientific data at the time the supplement was submitted was insufficient to justify a warning change – sets up a “clear evidence” preemption defense.  In Cerveny v. Aventis, Inc., 855 F.3d 1091 (10th Cir. 2017), which we discussed here, the court held:

We conclude that the rejection of a [submission to the FDA] may constitute clear evidence that the FDA would have rejected a manufacturer-initiated change to a drug label. Our case provides a perfect example. . . .  Under the standard that would have applied to a change proposed by [the manufacturer], the FDA concluded that warnings were unjustified for risks [at issue in this case].  That conclusion controls here, and the FDA’s denial constitutes clear evidence that the FDA would not have approved the [plaintiffs’] desired warning.

Id. at 1105.  Indeed, the big preemption fight in Cerveny wasn’t even about whether an FDA rejection was preemptive “clear evidence,” but rather focused on whether an FDA citizen’s petition filed by a non-NDA holder should be given the same effect as an FDA rejection of a manufacturer’s NDA supplement.  The scientific standards for both are the same, and Cerveny said that’s enough for preemption.  Id.

Some states disagree, and only give preemptive effect to FDA rejection of manufacturer-filed submissions.  Notably, Massachusetts is in this category.  See Reckis v. Johnson & Johnson, 28 N.E.3d 445, 459-60 (Mass. 2015) (holding that FDA decision rejecting additional warning language proposed by defendant would preempt claims, but not FDA rejection of a third-party citizen’s petition).  California trial court decisions provide a solid basis for a Cerveny-like preemption argument.  See In re Incretin-Based Therapies Products Liability Litigation, 142 F. Supp.3d 1108, 1122-23 (S.D. Cal. 2015), rev’d on other grounds, ___ F. Appx. ___, 2017 WL 6030735 (9th Cir. Dec. 6, 2017) (as to Buckman preemption); Risperdal & Invega Product Liability Cases, 2017 WL 4100102, at *10-11 (Cal. Super. March 16, 2017), reconsideration denied, 2017 WL 4479317 (Cal. Super. July 24, 2017); In re Byetta Cases, 2015 WL 7184655, at *13-14 (Cal. Super. Nov. 13, 2015).  Since the strategy we’re recommending that branded manufacturers consider involves manufacturer-submitted supplements, the distinction drawn in Reckis would be irrelevant.

Thus, if a branded company is staring down the barrel of extensive innovator liability for injuries caused by products it did not make, and thus received no profit from manufacturing, it may be time to reconsider, at certain critical periods, whether to err on side of extreme caution concerning possible emergent risks, and let the FDA decide.  If the FDA says no warning is justified at those times, then the company can assert a “clear evidence” preemption defense against future plaintiffs (innovator liability or otherwise) claiming the opposite.

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To our in-house readers:

Do these arguments interest you?  Well, Bexis has put together a detailed presentation on these – and several other − ideas for combatting/ameliorating innovator liability.  The dog and pony show takes about an hour, and if you’d like Bexis to pay you a visit and discuss innovator liability with your in-house legal team (invite your outside counsel, too, if you’d like) send an email and we’ll try to set something up.

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.

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

It may be post Mardi Gras season, but we don’t think there is ever a bad time to embrace the motto – “Laissez les bons temps rouler.” Quite literally – “Let the good times roll.” However, don’t try this with your high school French teacher, because after her gasp of horror, she will tell you that the grammatically correct way to get a party started in France is “Prenons du bons temps.” Of course, the Louisiana version is really Cajun French as opposed to France French and with both having so many good things to offer it’s really a matter of preference in a given moment. Like deciding if you’re in the mood for bouillabaisse or crawfish etouffee; a beignet or a croissant; a Hurricane or a Cabernet Franc.

Now that we’ve got you thinking about what’s for dinner, we can narrow our Louisiana focus to just the Louisiana Products Liability Act (“LPLA”) – hoping to whet your legal appetite now. In the case of Pierre v. Medtronic, Inc., 2018 U.S. Dist. LEXIS 67773 (E.D. Lous. April 23, 2018), plaintiff alleged she was injured as a result of defendant’s self-fixating mesh that was used in plaintiff’s abdominal surgery. Plaintiff alleges she suffered an infection and pain following her surgery. Id. at *2. We are jumping to the end of the decision to immediately lop off several of plaintiff’s claims. The court dismissed claims for breach of warranty of fitness for ordinary use, negligence, breach of implied warranty, negligent misrepresentation, and negligent design all on the grounds that they exceed the scope of the LPLA and the LPLA “sets forth the exclusive theories of liability for manufacturers for damage caused by their products.” Id. at *15.

So, what claims does the LPLA allow? Manufacturing defect, design defect, failure to warn, and express warranty. Id. at *5. And on defendant’s motion to dismiss, only half those claims survived. The first claim to survive, unusual for a drug/device case, is for manufacturing defect. That’s because here plaintiff had a specific allegation that the mesh used in her surgery was improperly sterilized which led to her development of an infection. Because plaintiff is challenging a deviation from the standard procedures for this product, she’s stated a claim for a manufacturing defect. But the court was clear that what plaintiff could not do is attack the defendant’s sterilization process generally, only this particular alleged deviation. Id. at *7-8.

Next plaintiff alleged two design defects. First plaintiff alleged that the mesh was defective in that it was made of polyester, a weaker material than used in other mesh products, and that the weaker material required a different method of being secured which ultimately led to causing plaintiff more pain than she would have suffered with a different method of attachment. Id. at *8-9. Since plaintiff alleged a design defect, alleged that that defect was the cause of one of her injuries (pain), and that alternative designs existed, she passed TwIqbal on this claim. Her second design claim, however, did not meet that standard. Plaintiff alleged that the design of the mesh caused her infection by lowering her pH. But missing from this claim is any suggestion of “the existence of a feasible alternative design that would prevent the alleged injury.” Id. at *10.

There was no splitting the baby on plaintiff’s failure to warn claim. It was dismissed in its entirety. As to the alleged failure to warn about infection, plaintiff relies exclusively on a single marketing document. However, plaintiff failed to allege any facts “to plausibly suggest that [plaintiff’s] surgeon relied, or any competent surgeon would rely, on this marketing document when deciding whether to perform surgery.” Id. at *11. A pretty demanding standard when you infer, and we think the court was so implying, that no competent surgeon relies on marketing material to make medical decisions. Moreover, the court pointed out several ways in which the marketing document cites to other documents, most importantly to the “Instructions for Use” of the mesh demonstrating that “Defendants did not rely solely, if at all, on the marketing document to warn users of the risks.” Id. at *12. Not to mention that the risk of infection is a “common surgical complication” most likely already known to plaintiff’s surgeon. Id.

Plaintiff’s second failure to warn claim was based on a failure to warn that the mesh might contract after surgery causing pain. Id. Here plaintiff failed to allege any facts about what warning was provided to plaintiff’s surgeon relying only on a boilerplate statement that defendant didn’t warn. Id. But such an “allegation is too broad to state a claim because it does not identify (1) which aspects of the product warranted a warning and (2) what injuries resulted from the failure to warn.” Id. at *13. Too vague to withstand dismissal.

So too was plaintiff’s breach of express warranty claim. Plaintiff only alleged that defendant warranted the product was safe and fit for its intended use, merchantable, adequately tested, and did not have dangerous side effects. Id. at *14. But a claim that a product is “safe” or “effective” is only a “general opinion” or “general praise,” insufficient to form the basis for an express warranty under the LPLA.

Of the 6 claims brought that were permissible under the LPLA, only 2 survived the motion to dismiss. Not a complete win, but good enough to put in the “good times” category. And if you don’t want to get embroiled in the French debate, we recommend following the lead of Shirley & Lee from 1956 or The Cars from 1978 and just let the good times roll (in English).

Not quite two years ago, the United States Supreme Court did something that we liked a lot – it abolished the so-called “presumption against preemption” in express preemption cases. It did that in a bankruptcy case, Puerto Rico v. Franklin-California Tax-Free Trust, 136 S. Ct. 1938 (2016) (“Franklin”), so it took a little while before we found out about it.  Once we did, we immediately let the word be known:

The plain text of the [preemption clause] begins and ends our analysis. Resolving [the question] for purposes of the pre-emption provision begins “with the language of the statute itself,” and that “is also where the inquiry should end,” for “the statute’s language is plain.”  And because the statute “contains an express pre-emption clause,” we do not invoke any presumption against pre-emption but instead “focus on the plain wording of the clause, which necessarily contains the best evidence of Congress’ pre-emptive intent.”

Id. at 1946 (emphasis added).

Now, when the Supreme Court makes a holding like that about preemption, that should be the end of the matter.  But as we’ve pointed out many times before, strange things tend to happen when preemption mixes with state-law product liability actions.  So, now that nearly two years have passed, how well has the Supreme Court’s abolition of the presumption against preemption in express preemption cases been respected by the lower courts?

Generally, the courts have followed the Supreme Court’s lead.  The Ninth Circuit, which sometimes has had to be reigned in by the Court, did not stray on this issue.  In Atay v. County of Maui, 842 F.3d 688, 699 (9th Cir. 2016), a preemption case involving genetically modified foods, the court placed the abolition of the presumption against preemption among its “federal preemption principles”:

Where the intent of a statutory provision that speaks expressly to the question of preemption is at issue, “we do not invoke any presumption against pre-emption but instead focus on the plain wording of the clause, which necessarily contains the best evidence of Congress’ pre-emptive intent.”

Id. at 699 (quoting Franklin).  With no adverse presumption, the state action in Atay – an attempt to ban the growing of anything genetically modified – was held preempted.  Id. at 702-03.

The Eighth Circuit in Watson v. Air Methods Corp., 870 F.3d 812, 817 (8th Cir. 2017), also followed Franklin:

In determining the meaning of an express pre-emption provision, we apply no presumption against pre-emption, and we “focus on the plain wording of the clause, which necessarily contains the best evidence of Congress’ pre-emptive intent.”

Id. at 817.  Finding the text of the relevant statute (involving airline deregulation) “highly elastic and so of limited help,” id. (citation and quotation marks omitted), Watson concluded that the plaintiff’s wrongful discharge claim was “too tenuous, remote, or peripheral to [be] expressly pre-empted.  Id. at 818.

In EagleMed LLC v. Cox, 868 F.3d 893, 903 (10th Cir. 2017), another airline deregulation case, the court found that air ambulance services were governed by the statute, and therefore state worker’s compensation claims against them were expressly preempted.  As for any presumption against preemption:

[W]hen a statute contains an express preemption clause, “we do not invoke any presumption against pre-emption but instead focus on the plain wording of the clause, which necessarily contains the best evidence of Congress’ pre-emptive intent.”  And when the statute’s language is plain, our inquiry into preemption both begins and ends with the language of the statute itself.

Id. at 903 (citing Franklin).  Because not “a single textual reason” was offered in opposition to preemption, the state claims failed.  “[P]olicy reasons cannot trump the plain language of the statute.”  Id. at 904.

More directly applicable to what we do, Conklin v. Medtronic, Inc., __ P.3d __, 2017 WL 4682107 (Ariz. App. Oct. 19, 2017), likewise recognized the demise of the presumption against preemption in a medical device product liability case.  “While federal laws are presumed not to preempt state laws, courts do not invoke that presumption when the federal statute contains an express preemption clause.”  Id. at *2.  In addition to Franklin, Conklin cited the four-justice dissent in Cuomo v. Clearing House Ass’n, L.L.C., 557 U.S. 519, 554 (2009) (“There should be no presumption against pre-emption because Congress has expressly pre-empted state law in this case.”), and the absence of any application of a presumption against preemption in Riegel v. Medtronic, Inc., 552 U.S. 312 (2008).  Every product liability claim except allegations of failure to make FDA-required reports was held preempted in Conklin.

Federal district courts have reached the same result.  In In re Smith & Nephew Birmingham Hip Resurfacing (BHR) Hip Implant Products Liability Litigation, the MDL judge recognized that “[r]ecently, the Supreme Court explained that a court should not apply a presumption against preemption when a ‘statute contains an express pre-emption clause,’” and did “not rely on a presumption against preemption”  not that it seemed to make much difference.  ___ F. Supp.3d ___, 2018 WL 1471684, at *6 n.8 (D. Md. March 26, 2018).  Another unbound court, Olmstead v. Bayer Corp., 2017 WL 3498696, at *3 n.2 (N.D.N.Y. Aug. 15, 2017), declared that, after Franklin, assertion of presumption against preemption in express preemption was “frivolous”:

Plaintiff’s argument that there is a strong presumption against preemption and that this presumption applies to the MDA’s express preemption clause is frivolous.

Id. at *3 n.2 (Franklin citation and quotation omitted).  Medical device-related claims were preempted.  Another New York court, Canale v. Colgate-Palmolive Co., 258 F. Supp.3d 312 (S.D.N.Y. 2017), pointed out in another FDCA case, that the plaintiffs’ assertion of an “assumption” that common-law claims were not preempted was contrary to law:

Defendant correctly points out that where, as here, Congress has expressly manifested its intent to preempt state law, no presumption against preemption arises.  [Franklin citation omitted]   Rather, courts “focus on the plain wording of the clause, which necessarily contains the best evidence of Congress’ preemptive intent.”

Id. at 319 (quoting Chamber of Commerce of the U.S. v. Whiting, 563 U.S. 582, 594 (2011)).

The following bound courts – from the Ninth and Tenth Circuits, also rejected any presumption against preemption in reliance on Franklin.  In re Chrysler-Dodge-Jeep Ecodiesel Marketing, Sales Practices, & Products Liability Litigation, ___ F. Supp.3d ___, 2018 WL 1335901, at *43 (N.D. Cal. March 15, 2018); Kaiser v. CSL Plasma Inc., 240 F. Supp.3d 1129, 1135 (W.D. Wash. 2017) (implied preemption case); In re Bard IVC Filters Products Liability Litigation, 2017 WL 5625547, at *4 (D. Ariz. Nov. 22, 2017); In re Syngenta Ag Mir 162 Corn Litigation, 2016 WL 4382772, at *3 (D. Kan. Aug. 17, 2016).

Finally, as an example proving our prior proposition that strange things happen when preemption and product liability mix, the Third Circuit in Shuker v. Smith & Nephew, PLC, 885 F.3d 760, 771 n.9 (3d Cir. 2018), so far uniquely, decided that it wasn’t going bound by the Supreme Court’s decision in Franklin.  Unless and until the Supreme Court rejects the presumption in a product liability case, the Third Circuit will continue to apply it – everybody else be damned:

We disagree with [defendant’s] assertion that “[a]ny presumption against express preemption no longer exists.”  [Defendant] relies on [Franklin] . . . but that case did not address preemption of claims invoking “historic . . . state regulation of matters of health and safety,” such as the products liability claims at issue here.  As [Franklin] does not “directly control[ ]” here, we “leav[e] to [the Supreme Court] the prerogative of overruling its own decisions,” Agostini v. Felton, 521 U.S. 203, 237 (1997), and continue to apply the presumption against preemption to claims, like those in this case, that invoke “the historic police powers of the States,”

Shuker, 885 F.3d at 771 n.9 (citations to Medtronic, Inc. v. Lohr, 518 U.S. 470 (1996) omitted).

Just like that, without acknowledging either: (1) that the Supreme Court had already refused to apply a presumption against preemption to the same preemption clause in Riegel v. Medtronic, Inc., 552 U.S. 312 (2008); or (2) that its ruling was in conflict with every other court of appeals decision to rule on the question, Shuker chose to ignore an on-point Supreme Court decision that was less than two years old.

Moreover, the Shuker panel evidently went where even the Shuker plaintiffs were loath to go.  The plaintiffs in their two briefs (there were cross-appeals in Shuker) didn’t even attempt to argue a presumption against preemption. See Brief of Appellants, 2017 WL 413755 (3d Cir. filed Jan. 23, 2017); Reply Brief of Appellants to Brief of Appellee Smith & Nephew, Inc., 2017 WL 2211289 (3d Cir. filed May 8, 2017).  Heck, plaintiffs in Shuker didn’t even cite Lohr.  We keep thinking appellate judges should know better than to do things like this, and perhaps they do, but strange things happen when preemption meets product liability.

We are back in the trenches today after spending a wonderful day in New York with our lifelong best friend, in yet another of the blissfully endless celebrations of the milestone birthday we marked in December. We saw “The Band’s Visit,” a new musical based on a 2007 movie about eight members of an Egyptian police orchestra stranded overnight in a remote Israeli town.  The band members accept a local resident’s invitation to bunk overnight in her café, setting the stage for lovely intersections of hearts, minds, and cultures.  It is short, sweet, and very satisfying.

As is today’s case, for those of us who defend prescription drug and device manufacturers. In Kwasniewski v. Sanofi-Aventis, LLC, 2018 WL 1567851 (D. Nev. Mar. 30, 2018), the plaintiffs alleged that the defendant’s prescription sleep medication caused their decedent to commit suicide.  The opinion includes the judge’s decisions on objections to several earlier rulings by the magistrate judge and her decision on the defendant’s motion to dismiss the plaintiffs’ design defect claims.

Objections to Magistrate’s Rulings

First, the plaintiffs objected to the magistrate’s refusal to stay discovery – and relieve the plaintiffs of their obligation to respond to the defendant’s pending discovery requests – while the defendant’s Motion to Dismiss was pending. The court agreed with the magistrate, emphasizing that “[t]he Federal Rules of Civil Procedure do not provide for automatic or blanket stays of discovery when a potentially dispositive motion is pending.” Kwasniewski, 2018 WL 1567851 at *2.

Second, the plaintiffs objected to the magistrate’s application of Nevada’s learned intermediary doctrine.   In a 30(b)(6) deposition notice, the plaintiffs included topics concerning “information about direct to consumer advertising.”  Because, under the learned intermediary doctrine, the defendant had a duty to warn only “medical experts, not consumers, about the dangers of [its prescription drug],” id. at *4, the magistrate ruled that deposition testimony about direct-to-consumer advertising was irrelevant.  As such, she limited the plaintiffs’ Rule 30(b)(6) deposition topics to the defendant’s “representations to the medical community.”  The plaintiffs argued that the magistrate had “effectively decided a dispositive motion” by applying the learned intermediary doctrine, and that the doctrine was an affirmative defense that had not yet been pled.  The court again affirmed the magistrate and barred the plaintiffs from discovering information  that the defendant had disseminated directly to consumers. We like this ruling and applaud the court’s adherence to the standard imposed by Fed. R. Civ. P. 26, requiring discovery to be “relevant to [a] party’s claim or defense and proportional to the needs of the case,” and its refusal to sanction a meaningless and abusive fishing expedition.

Defendant’s Motion to Dismiss

The defendant moved to dismiss the plaintiffs’ design defect claims sounding in both strict liability and negligence, arguing that “any claim that [the defendant] should have changed the formulation of [the product] or that the product should simply not have been marketed are preempted by Federal Law.” Id. at *5.  In their response, the plaintiffs conceded that they were “not arguing that that [the defendant] should have reformulated the drug – just simply that [the defendant] should have” included adequate warnings of the drugs alleged suicidality risk. Id. As such, the court was able to grant the defendant’s motion, and foreclose the plaintiff’s from alleging a design defect claim at a later date, without addressing the preemption argument.. (Given this court’s clear-headed, correct-leaning rulings, we suspect that its preemption decision would have been fun to read.)

Kwasniewski is a tidy, no-nonsense, defense-friendly opinion.. If, on this beautiful spring day, we are confined to an office and not roaming the Great White Way, we are pleased that this case crossed our desk.

Last year’s list of the Ten Worst DDL cases was remarkable because all ten decisions came from appellate courts.  Yikes.  And it is not as if the bad appellate decisions were spread around.  Two came from our home circuit, the Third.  Two came from the reliably problematic Ninth Circuit.  But the ‘winner’ was the Eleventh Circuit, with three terrible opinions.  For defense practitioners, Eleventh Circuit precedents can create something of an obstacle course. 

 

It turns out that good federal district judges in SEC country also can be frustrated with what their appellate brethren hath wrought.  Last week we were sent an interesting example of this: Rowe v. Mentor Worldwide, LLC, No. 8:17-cv-2438-T-30CPT (M.D. Fla. March 2, 2018).  In that case, the plaintiff sued for negligence, strict liability, and breach of warranty arising out of injuries allegedly caused by a silicone gel breast implant. The breast implants are class 3 devices requiring premarket approval from the FDA.  The plaintiff’s implants had ruptured.  The plaintiff asserted that the defendant failed to conduct proper studies and failed to warn about known risks.  The defendant filed a motion to dismiss.  The district court wrote a thorough and well-reasoned opinion, concluding that all of the claims save one must be dismissed.  All of the claims would have been dismissed had it not been for a pesky Eleventh Circuit case that is unsound and inconsistent with other Eleventh Circuit cases.  The district judge acknowledged being stuck, but was none too happy about it.  The Rowe court’s opinion is laid out logically, and we will do our best to track it.

 

Pleadings

 

The court addresses “a growing plague on the justice system, which has wreaked havoc in this case and numerous others: poorly drafted pleadings.” Slip op. at 4. We get an Iqbal name-check.  The Rowe court recognizes the liberalities of notice pleading, but also recognizes that “[t]here is a point, though, where a pleading becomes deficient not because it lacks sufficient allegations to provide notice of claims, but because it buries those allegations among pages of irrelevant and impertinent material.”  Id. at 5  The complaint in this case was 60 pages, with 151 pages of exhibits.  The negligence claim includes “six separate negligence theories that are confusingly interwoven among each other.”  Id. at 5.  In short, the plaintiff “threw every allegation into the Complaint to see what would stick.”  Id. at 6.  But instead of throwing out the complaint wholesale, the court examined the particular causes of action to see which ones, in fact, would stick.

 

Preemption Overview

 

For its preemption analysis, the Rowe court largely relied on the recent Eleventh Circuit decision in Godelia.  That ends up having its ups and downs.  But the general preemption analysis is straightforward enough.  The threshold questions is whether the claims are valid under Florida state law, which governs the case.  If not, those claims are gone.  If so, the next questions is whether those claims are preempted by federal law.

 

Negligence failure to warn 

 

The plaintiff does not allege that the defendant failed to give the warning required by FDA. Therefore, the plaintiff must be seeking to impose a warning requirement that is different from or in addition to federal law.  Such a claim is expressly preempted by statute. Slip op. at 9.

 

Failure to report adverse events 

 

As any even semi-faithful reader of this blog knows, we think this claim is hogwash.  It should fail both on simple causation grounds as well as preemption.  We wrote about this issue earlier this week.  Some of you might know that the Ninth Circuit is a devilishly bad place for defendants on this issue.  But the Rowe court is not in the Ninth Circuit.  Instead, it is Eleventh Circuit law that supplies the framework, and this is one area where the Eleventh Circuit is pretty good, as it sees failure to report claims under Florida law as essentially alleging a claim of fraud on the FDA, which is preempted by Buckman. Slip op. at 10.

 

Failure to comply with federal laws 

 

The claims under this category pertain to alleged breaches of federal requirements and regulations. One example mentioned in the complaint is failure to do required studies.  But Florida law imposes no such requirement. So this claim flunks the preliminary test.  Even if the claim somehow survived that test, it would be impliedly preempted.  Id. at 11.

 

Negligent misrepresentation  

 

The plaintiff offered only the most general allegations of failures to disclose the risks of the implants. The court deemed these allegations to fall far short of Fed. R. Civ. P. 9(b), which requires specificity of fraud allegations.  The plaintiff “never identifies what the misrepresentations were, when they were made, how they were made, where they were made, or who made them.”  Id. at 12. In any event, the misrepresentations seemed to involve what was and was not told to the FDA.  Accordingly, those claims are impliedly preempted under BuckmanId. at 13.

 

Negligence per se 

 

Violation of a federal statute does not establish negligence per se if there is no federal private cause of action.  No such federal private cause of action exists here.  The complaint does not state a parallel claim, and is therefore impliedly preempted. Id. at 14.

 

Manufacturing defect 

 

Everything had been gliding along so smoothly up to this point.  Now we hit a rough patch.  The plaintiff alleged deviations from requirements in the device’s PMA, departures from good manufacturing practices, and vague failures to exercise care in the manufacturing process.  The defendant argued that the plaintiff never pointed to any device-specific requirements. It supported its argument by citing WolickiGables (11th Cir. 2011).  The Rowe court agreed that the Wolicki-Gables standard would require dismissal of the complaint.  But recent Eleventh Circuit decisions in Mink and Godelia cut the other way.  “The holdings in Mink and Godelia are directly at odds with Wolicki-Gables and appear to announce a new standard the Eleventh Circuit is directing courts to apply.”  Slip op. at 16-17.  (We listed Mink as the eighth worst DDL case of 2017.  Here is the post where we explained why we think Mink stinks.)  The Rowe court felt stuck.  Under recent rulings, the plaintiff could conceivably state a claim under parallel requirement.  At the same time, the court recognized that the “negligence count is nearly eviscerated by the Court’s ruling on the other theories.”  Id. at 17.  This, just to ensure there really is some there there, the court directed the plaintiff to replead the one surviving claim in an amended complaint. 

 

(This kerfuffle over what to do about competing circuit precedents reminds us of our time clerking on the Ninth Circuit, which is so huge and spread out that, believe it or not, inconsistent holdings proliferate.  What to do?  Assume there was  no en banc decision, which is what it should take to alter circuit precedent.  Does a panel need to follow the earlier or later decisions.  Your instincts might prompt you to conclude that it is always the most recent precedent that controls.  But if the recent decision’s reversal of precedent was improper, maybe even illegitimate, because it did not go the en banc route, should it really command respect?  We wrote a bit on this issue last year, as part of our extended Fosamax mourning period, and argued that the earlier precedent should control and the later deviation deserves no respect.)

 

 

Strict liability – failure to warn 

 

The analysis here is the same as for negligent failure to warn, and so is the result: preempted. Slip op. at 18.

 

Strict liability – manufacturing defect 

 

Remarkably, the result here is different from the negligent manufacturing defect claim.  For some unknown reason, the plaintiff did not ladle any specific federal requirements into this claim. Instead, the plaintiff simply relied on good manufacturing practices.  Not good enough.  Such allegations do not pass muster under either old or new Eleventh Circuit precedent.  Id. at 18.

 

Breach of implied warranty 

 

Plaintiffs constantly toss in warranty claims as an apparent afterthought.  Or maybe it is a no-thought.  The Rowe case is controlled by Florida law, and Florida law requires privity.  That is all perfectly obvious.  Equally obvious is that breast implants are not available for purchase directly by consumers.  The plaintiff pretty much conceded absence of privity and absence of a legal basis for proceeding with this claim, by not responding to the argument.  The court dismissed the warranty claim. 

 

Final scorecard

 

All that is left is the negligent manufacturing defect claim.  That should be a hard one for the plaintiff to win.

 

It occurs to us that good district judges such as Rowe’s are not the only folks who must grit their teeth and do battle with the Eleventh Circuit’s doctrinal wanderings.  Defense DDL practitioners are in the same boat.  We can relate, inasmuch as the Third Circuit (think of Fosamax) has done us few favors lately.  So we commiserate with excellent defense lawyers such as the ones who fought for and won as complete a victory as reasonably possible in the Rowe case.  Congratulations to Dustin Rawlin, Monee Hanna, and Allison Burke of Tucker Ellis, and David Walz of Carlton Fields.

 

 

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

We’ve posted on two other occasions about the Shuker v. Smith & Nephew case as the Eastern District of Pennsylvania systematically dismantled the case on the grounds of preemption and pleading deficiencies. You can find those posts here and here. Unfortunately, the recent Third Circuit opinion deciding plaintiff’s appeal isn’t the full affirmance we had been hoping for. But before you get the wrong idea, the Third Circuit got the most important issue right – when you have a multi-component medical device, PMA preemption is to be addressed on a component-by-component basis. After that, however, the appellate decision does some unraveling of the district’s dismissal of the claims that survived preemption and so the case is going back to the Eastern District.

Briefly, the facts are that plaintiff underwent a hip replacement surgery in which his surgeon opted to use a Smith & Nephew device that consisted of several component parts, one of which was the R3 metal liner. Shuker v. Smith & Nephew, PLC, 2018 U.S. App. LEXIS 5160, *11 (3d Cir. Mar. 1, 2018). Unlike the other components of the device, the liner had undergone FDA Pre-Market approval. Id. And, the parties are in agreement that the surgeon’s decision to use the R3 metal liner with this particular device was an off-label use. Id. at *12. Plaintiff suffered complications that required additional revision surgeries.

In its first decision, the district court tossed out almost all claims as preempted and any non-preempted claims for being inadequately pleaded. When plaintiff filed an amended complaint attempting to correct the pleading deficiencies for the non-preempted claims, he again missed the mark and his remaining claims were dismissed with prejudice. The district court also entered a decision finding that it lacked personal jurisdiction over Smith & Nephew, PLC – a foreign parent company. Those three rulings are what the Third Circuit addressed in last week’s decision.

The question of how to apply PMA-preemption to a multi-component device was one of first impression in the Courts of Appeal. Id. at *2. And it is an important question because surgeons engaging in off-label use do mix and match parts with different regulatory backgrounds. The Third Circuit did a precise analysis that landed at the proper conclusion. However, the analysis does start up with a bit of a hiccup. Since we are talking about PMA-preemption, we are dealing with express preemption. Yet, in a footnote the court refused to follow the Supreme Court’s recent abolition of the presumption against preemption in the express preemption context set forth in Puerto Rico v. Franklin Cal. Tax-Free Tr., 136 S.Ct. 1938 (2016), because that decision wasn’t a products liability case and therefore did not directly concern the “historic police powers of the States.” Shuker, at *16n.9. We respectfully disagree with this conclusion for all the reasons we mention in our post discussing Franklin and simply point out that other courts have reached the opposite conclusion. Accord Watson v. Air Methods Corp., 870 F.3d 812, 817 (8th Cir. 2017) (following Franklin and rejecting presumption against preemption in express preemption case); EagleMed LLC v. Cox, 868 F.3d 893, 903, (10th Cir. 2017) (same); Atay v. Cty. of Maui, 842 F.3d 688, 699 (9th Cir. 2016) (same); Conklin v. Medtronic, Inc., ___ P.3d ___, 2017 WL 4682107, at *2 (Ariz. App. Oct. 19, 2017) (under Franklin courts may not invoke a presumption against preemption in PMA preemption cases); Olmstead v. Bayer Corp., 2017 WL 3498696, at *3 n.2 (N.D.N.Y. Aug. 15, 2017) (plaintiff’s assertion of presumption against preemption in PMA preemption case held “frivolous” after Franklin).

Fortunately, that did not derail the Third Circuit from ultimately concluding that plaintiff’s negligence, strict liability, and breach of implied warranty claims were all preempted under Riegel. To do that, the court had to determine to what device it was applying the preemption analysis. Plaintiff argued that you have to look at the device that was implanted as a whole. Whereas defendant, bolstered by an amicus brief filed by the FDA at the court’s request, maintained that the proper focus is on the component of the device with which plaintiff takes issue. Shuker, at *18. Agreeing with the defense position, the court anchored its decision on three findings. First, the FDCA defines “device” to include “components, parts, and accessories.” Id. at *19. Second, the FDCA’s off-label provisions specifically acknowledge that a physician can and will use components separately from the system for which the FDA approved use. Id. at *20. And despite the use to which the component is put, the FDA’s PMA-regulations for the component follow with it. In other words, “premarket approval requirements apply equally to the components, as manufacturers generally may not deviate from the requirements imposed through premarket approval regardless of how [a component] is used.” Id. (citation and quotation marks omitted). Third, the FDA’s position is that the device is not limited to the device as a whole but includes components. Further, the FDA is charged with assuring the safety and effectiveness of components as well as finished devices. Id. at *21-22.

Therefore,

[t]aken together, the statutory definition of “device,” the treatment of off-label uses, and the guidance of the FDA all counsel in favor of scrutinizing hybrid systems at the component-level. . . .. And the Riegel test is properly framed at Step One as “whether the Federal Government has established requirements applicable” to a component of the hybrid system.

Id. at *22-23. Because the part of the device plaintiff attacked was the R3 metal liner which was premarket-approved, any state tort claim that seeks to impose requirements that are different from or in addition to the FDA’s requirements for that component are preempted. That includes plaintiff’s negligence, strict liability, and implied warranty claims.

The appellate court next reviewed the dismissal of plaintiff’s claims that survived preemption – negligence and fraud claims based on alleged off-label promotion in violation of federal law – and found the negligence claim was adequately pleaded but that plaintiff failed again to satisfy Rule 9’s heightened standard for pleading fraud. As to negligence, the court found TwIqbal satisfied as to duty, breach, causation where plaintiff alleged:

  • the R3 metal liner was approved only for use with a different system and therefore under federal law defendant had a duty to refrain from false or misleading advertising;
  • in a press release, defendant misleadingly marketed the R3 metal liner as an option for the system used by plaintiff’s surgeon (one other than the one it was approved for); and
  • plaintiff’s surgeon “either read” or “was aware” of the press release.

Id. at *28-29. Like the district court, the Third Circuit considered and relied upon the press release cited in plaintiff’s complaint. Unlike the district court, the Third Circuit appears to only focus on the portions of the press release upon which plaintiff relied (see prior post for more details) and concludes that’s enough to get plaintiff to the discovery stage. Id. at *29n.18. Although we wonder if the court’s calling plaintiff’s allegations enough to “nudge” the claim over the threshold is a veiled acknowledgement of just how narrowly the complaint squeaked by. See id. at *30.

Meanwhile, plaintiff’s fraud claim needed more than a nudge and it didn’t get even that. The court focused on plaintiff’s failure to plead justifiable reliance on the alleged misrepresentation. The “read” or “was aware” of allegation that sufficed for negligence lacked the requisite details regarding how the press release “induced or influenced” plaintiff’s surgeon for a fraud claim. Id. at *33-34. Plaintiff has to allege the “circumstances of the alleged [influence on Mr. Shuker’s surgeon] with sufficient particularity to place [defendant] on notice of the precise misconduct with which it is charged.” Id. at *34. Despite this having been plaintiff’s second failed attempt at meeting the pleading standard on fraud, the Third Circuit decided to give plaintiff another chance and found the claim should only be dismissed without prejudice.

Finally, there was a separate finding by the district court that it did not have personal jurisdiction over Smith & Nephew, PLC, a foreign parent company. The Third Circuit agreed with the district court that specific personal jurisdiction was not conferred on a stream-of-commerce theory. Id. at *36-37. We’ve talked about this before and more recently in light of BMS v. Superior Court, and like the Third Circuit “we have no cause to revisit” the precedent on the issue (but you should feel free to). But the court did think plaintiff alleged enough in his complaint to allow some limited jurisdictional discovery on possible alter ego based personal jurisdiction. Id. at *38-40. Emphasis on the limited part. See id. at *40n.20 (“District Court should take care to circumscribe the scope of discovery . . . to only the factual questions necessary to determine its jurisdiction;” further referencing proportionality amendment to Rule 26(b)(1)).

So, on the third pass plaintiff got a little life breathed back into this case which is unfortunate, but as the first appellate decision on component preemption – we’ll put it in the win column.

This should not be controversial. It has been settled since Hahn v. Richter, 673 A.2d 888 (Pa. 1996) that in Pennsylvania prescription drugs are exempt from strict liability. And since Tincher v. Omega Flex, Inc., 104 A.3d 328 (Pa. 2014) re-worked Pennsylvania’s strict liability law, we’ve only reported one federal court decision that erroneously, in our opinion, concluded that Tincher allowed a strict liability manufacturing defect claim in a prescription medical device case. But that hasn’t stopped plaintiffs from continuing to try to pursue strict liability under Pennsylvania law. The most recent federal court to be confronted with the argument rejected it outright. Some TwIqbal and preemption are in the mix too so this one really hits on some of our favorites.

Plaintiff alleged he developed an acute kidney injury as a result of taking the prescription drug Jardiance. Bell v. Boehringer Ingelheim Pharmaceuticals, Inc., 2018 U.S. Dist. LEXIS 24802, *1 (W.D. Pa. Feb. 15, 2018). Defendants moved to dismiss the complaint on three grounds: 1) Pennsylvania law bars all non-negligence based claims; 2) the complaint fails to satisfy TwIqbal across the board; and 3) the claims against the non-NDA holding entity are preempted. Id. at *2-3.

Defendants’ first argument sought to dismiss not only strict liability design defect and failure to warn, but also gross negligence, breach of express and implied warranty, and all fraud and misrepresentation claims. Plaintiff’s response on strict liability was that Hahn is “antiquated.” Id. at *7. Hahn may be about to turn 22, but that means it’s only been legally drinking in bars for a year. Hardly over the hill. Not to mention, antiquated isn’t a legal standard that would allow a federal court to simply ignore the controlling law as announced by a state Supreme Court. Further, the court points out that Tincher expressly recognized the Hahn prescription drug exception (as did Lance v Wyeth, 85 A.3d 434 (Pa. 2014) which demonstrates that the Pennsylvania Supreme Court has not changed its position – Hahn is still good law. See Bell at *7-8.

But Hahn doesn’t just say no strict liability, it says “that negligence is the ‘only’ recognized basis of liability” in prescription drug cases. Id. at *8. So, on that basis, and ample federal precedent, the court dismissed plaintiff’s breach of warranty claims. Id. at *8-9. The case law applying Hahn to fraud and misrepresentation claims appears to be more divided and on this one the court opted to follow the cases that adopted a more narrow interpretation. Id. at *9-10. We think Hahn’s negligence only holding could easily be read as a bar to intentional misrepresentation and fraud which do not sound in negligence. The Bell court, however, concluded that because Hahn requires manufacturers to warn of both risks that should have been known as well as risks that were known, the latter is akin to a claim of intentional concealment of a known risk which would support a fraud or misrepresentation claim. So, those claims were not barred by Hahn.

The last challenge was to plaintiff’s gross negligence claim which the court dismissed as not recognized as an independent cause of action in Pennsylvania. Id. at *11.

But we need to quickly return to plaintiff’s surviving negligence and fraud/misrepresentation claims. They aren’t barred, but neither were they adequately pleaded. Apparently plaintiff’s counsel did not do a good job proofing the complaint because the court pointed out it appeared to be cut and paste from another complaint filed by a woman. Id. at *13 (complaint uses “her” and “she” pronouns). Cookie cutter complaints don’t survive under TwIqbal because they lack any of the necessary factual detail to support plaintiff’s claims. This complaint contained

no factual details about when Bell contracted diabetes, whether he has type I or type II diabetes, whether he has other medical conditions, who his treating physicians were, why he decided to take Jardiance, what alternatives to Jardiance were discussed, whether he read the warnings, how long he took Jardiance or at what dose or why he believes his acute renal failure was caused by Jardiance.

Id. The complaint was equally lacking regarding defendants. There were no specific allegations concerning how the warnings “fell below the standard of care,” how any defendant’s alleged breach of duty caused plaintiff’s injury, how the design was defective, or what safer alternatives existed. Id. at *13-14. The court was unwilling to “infer defectiveness” based only on “a generic description of how [the class of drugs] work[s]” and “formulaic legal conclusions.” Id. at *15.

All claims were dismissed under TwIqbal, but plaintiff only gets to amend his complaint to try to state a claim for those that survived the first part of the court’s analysis as recognized under state law.

So, that brings us to the final question – are the claims against the non-NDA holder preempted on the grounds that it had no ability to change the drug’s label or design. The plaintiff seemingly concedes that post-approval design defect claims would be preempted, but that he is making a claim that the defendant should have designed a safer product before approval. Id. at *17-18. The court briefly discussed some cases that have dealt with the issue of pre-approval design defect claims. We cover it here, along with our analysis that there is no such valid claim. But, because none of plaintiff’s claims survived TwIqbal, the court didn’t have to decide the preemption issue. Defendant can re-raise it after plaintiff files his amended complaint.

 

Today we have a guest post from Reed Smith‘s Elizabeth Minerd discussing a PMA preemption case dealing with unusual “parallel claim” allegations involving the conduct of clinical trials.  As always our guest posters are 100% responsible for what they write and deserve 100% of the credit (and any blame) for what follows.  Take it away Liz.

**********

Ever since Riegel v. Medtronic, Inc., 552 U.S. 312 (2008), in cases involving premarket-approved (“PMA”) devices, plaintiffs have taken to loading their complaints with allegations of violations of federal requirements in an attempt to escape federal preemption.  Fortunately, many courts have demonstrated a willingness to sort through these allegations and throw out those that do not fit through the oft-cited “narrow gap” between express and implied preemption described in In re Medtronic, Inc., Sprint Fidelis Leads Products Liab. Litig., 623 F.3d 1200, 1204 (8th Cir. 2010).  See the blog’s PMA preemption scorecard.  In Gravitt v. Mentor Worldwide, LLC, 2018 U.S. Dist. LEXIS 4822 (N.D. Ill. Jan. 11, 2018), the Northern District of Illinois once again did just that.

In Gravitt, the plaintiffs alleged that the wife plaintiff was implanted with a premarket-approved silicone breast implant (in the wake of the Breast Implant mass tort of the 20th century, such implants were required to obtain PMA, and are now protected by preemption). Id. at *8-9.  The plaintiffs asserted the usual claims against the defendant manufacturer: negligence, strict products liability (manufacturing and marketing), strict products liability (failure to warn), and loss of consortium. Id. at *10.

Obviously anticipating a preemption motion, the plaintiffs packed their complaint with allegations of violations of federal requirements—including novel theories attacking the defendant’s conduct of certain post-approval studies and patient follow-up required by the FDA’s PMA letter. Id. at *4-*6.  According to the plaintiffs, the defendant’s conduct was deficient because:

  1. Participant follow-up in one study supporting the PMA application was 6 years, instead of 10;
  2. Participant follow-up in the same study supporting the PMA application was less than 100%;
  3. A post-approval study did not have a sufficient number of participants;
  4. Participant follow-up in that post-approval study was not high enough; and
  5. The defendant did not provide sufficient detail about why study participants required additional surgical intervention.

Id. at *4-*6.

The court methodically addressed each of these alleged deficiencies to determine whether any fit through the “narrow gap” between express and implied preemption. Unfortunately for the plaintiffs, fortunately for the defense, none did.  Thus, defendants achieved a rare preemption win in a court bound by the notoriously bad decision, Bausch v. Stryker Corp., 630 F.3d 546 (7th Cir. 2010).

First, the court analyzed each deficiency through the lens of express preemption—i.e., asking, “did this alleged deficiency actually violate a federal requirement?”  The court found that the first three deficiencies (if true) would violate specific requirements enumerated in the PMA letter. Gravitt, 2018 U.S. Dist. LEXIS 4822, at *21-*22.  However, the court found no federal requirement addressing the last two purported deficiencies because “the [PMA] letter does not require any particular follow-up rate for that study” and the plaintiffs did not even allege “that the [PMA] letter or any other federal law required [defendant] to provide more detailed reasons for re-operation than it actually provided.” Id. at *18-*19.  Thus, items 4 and 5 were expressly preempted.

Second, the court analyzed the three remaining deficiencies through the lens of implied preemption—i.e., asking “did this alleged deficiency violate a traditional tort duty under Illinois law?”  Here, the court answered “no” for every one of the remaining purported deficiencies, rendering them impliedly preempted.  The court reasoned that there was no “well-recognized duty owed to [the plaintiffs] under state law” requiring the defendant to follow up with study participants for 6 instead of 10 years, follow-up with all study participants, or enroll a specific number of study participants. Id. at *24-*25 (quoting Bausch, 630 F.3d at 558).  More generally, there simply are no state law requirements relating in any way to the methodology of FDA-mandated post-approval studies. Gravitt, 2018 U.S. Dist. LEXIS 4822, at *25.  Further, the plaintiffs made no effort to analogize these alleged deficiencies to any traditional state law failure to warn claim. Id.  Accordingly, the court dismissed plaintiffs’ novel claims based on alleged deficiencies in post-approval studies, id., creating valuable precedent in case any other plaintiff tries this type of preemption dodge.

Apart from the alleged deficiencies in the post-approval studies, the plaintiffs also alleged that the defendant had violated manufacturing standards based on allegations that the FDA had cited the defendant for non-compliance with manufacturing standards several times. Id. at *7-*8.  While the court recognized that, under Bausch, such a claim might survive express preemption (id. at *22), the court dismissed this theory as impliedly preempted because the plaintiffs failed to tie the alleged non-compliance with manufacturing standards to any state law claim that her specific device was defectively manufactured. Id. at *26.

The court did allow one narrow Stengel-type (failure to report) claim to survive based on the plaintiffs’ allegations that the defendant was aware of a higher rate of implant ruptures than it reported to the FDA. Id. at *27-*28.  The court reasoned that, were the plaintiffs to prove that the defendant concealed the true rate of implant ruptures from the FDA in violation of federal law, then the defendant “may have breached its state law duty to warn potential customers—and their physicians—of the product’s risks.” Id. at *31.

Overall, a solid win for the defense that significantly narrowed the scope of the plaintiffs’ claims going forward.