While the focus of this blog is on product liability cases, we have had occasion to touch upon Lanham Act cases involving litigation between commercial competitors.  One reason is because Lanham Act cases provided significant early precedent for the principle that FDA exclusive enforcement powers prohibit plaintiffs from bringing what amount to private FDCA violation claims in the guise of private civil litigation.  You’ll find no shortage of posts here expounding that 21 U.S.C. §337(a) represents express congressional policy that nobody but the FDA can seek to enforce the FDCA in a court of law.  The concept took a hit with the Supreme Court’s decision in POM Wonderful v. Coca-Cola Co., 134 S.Ct. 2228 (2014), discussed here, but that decision involved food, not drugs or devices, which is an important distinction because the FDA does not pre-approve food labels.  And indeed, drug and device cases post POM Wonderful have done a good job of holding to that distinction finding that POM Wonderful didn’t open the door to Lanham Act claims that are based on proving FDCA violations.  A couple of 2019 cases discussed here and here.

Which brings us to today’s case – Belcher Pharmaceuticals, LLC v. Hospira, Inc., slip op. (M.D. FL Jan. 7, 2020).  The facts here are interesting.  The drug at issue was epinephrine.  Defendant had been manufacturing the drug since before the 1938 enactment of the FDCA.  Therefore it was grandfathered – did not need FDA approval.  However, the drug was in short supply.  So, the FDA asked the defendant to increase production, which defendant did.  A few years later, plaintiff had a competing product approved.  By 2017, the shortage was over and the FDA ask defendant to stop manufacturing its grandfathered product.  Defendant complied.  Not surprisingly, once defendant discontinued its product, plaintiff saw an increase in the sales of its product.  Slip op. at 1.  Plaintiff brought suit under the Lanham Act alleging that defendant falsely advertised its product as FDA-approved when it was not and sought recovery of any profits defendant made “for doing what the FDA requested.”  Slip op. at 2.  Talk about no good deed goes unpunished.

First, it was undisputed that defendant “never explicitly marketed its products as FDA-approved.”  Slip op. at 6.  Rather, plaintiff argued that defendant misled consumers into believing the product was FDA-approved merely based on the fact that defendant was selling its product.  Plaintiff pointed to the fact that defendant’s labeling and packaging included indications for use and shelf-life representations.  Id.  So, the pre-1938 product had labeling that looked like labeling that would routinely accompany FDA approved products.  OK?  And?  There has to be more right.  Yep.

[T]he very act of placing a drug on the market, with standard package inserts often used for FDA-approved drugs fails to state a claim under the Lanham Act because it would usurp the FDA’s authority to enforce the Food, Drug, and Cosmetics Act.

Id. at 7-8 (citations omitted).  The court doesn’t elaborate, but it doesn’t need to.  Where a case involves the intersection of the Lanham Act and the FDCA and would require the court to interpret and/or apply the FDCA, such claims are not permitted.  It’s not a products case, but any decision that trumpets FDA authority deserves a shout out on this blog.

Someone asked us the other day whether spoliation sanctions could lie against a non-party for alleged loss/destruction of electronically stored information sought through a third-party subpoena.  On the one hand, assuming there is personal jurisdiction, the substantive discovery rules do not vary between parties and non-litigants subjected to valid subpoenas.  On the other hand, other than monetary sanctions, Rule 37(e), regarding discovery sanctions for spoliation appears directed solely against parties.

So we thought we’d take a look.

Initially, we should be clear that we are discussing whether a third-party subpoena creates a duty to preserve – not whether such a duty exists in the absence of any legal process.  In the latter situation there is pretty clearly no duty.  Shamrock-Shamrock, Inc. v. Remark – a recent case involving Florida state discovery rules – demanded a subpoena as a prerequisite to any third-party preservation duties:

[L]itigants may employ various legal mechanisms to impose upon a third party a duty to preserve necessary evidence.  For example, a third party may be required to produce particular evidence it possesses in response to a subpoena. . . .

In this case, there was no statute, contract, or discovery request that would impose a clearly defined duty on [a third party] to preserve any potentially relevant evidence.  Thus, a duty would arise only through [the party’s] purported knowledge of [the] pending litigation. . . .   As such, [plaintiff] would like us to announce that [the third party] owed a duty to it based on the foreseeability of litigation.  Considering the traditional approach to defining legal duty, we decline to do so. Indeed, such a broad pronouncement would be tantamount to declaring a general legal duty on any nonparty witness to anticipate the needs of others’ lawsuits.  There are innumerable circumstances in which a nonparty to litigation may have evidence relevant to a case and may know of its relevance.  But that knowledge, by itself, should not give rise to a duty to safeguard the evidence in anticipation of litigation.

271 So. 3d 1200, 1205–06 (Fla. App. 2019) (rejecting independent action for spoliation for lack of duty) (citation omitted).  Accord In re Delta/AirTran Baggage Fee Antitrust Litigation, 770 F. Supp.2d 1299, 1307-08 (N.D. Ga. 2011) (rejecting “sweeping and novel theory of spoliation” that a subpoena served in different litigation could create a preservation duty to plaintiffs in other litigation).  But see Woods v. Scissons, 2019 WL 3816727, at *4 (D. Ariz. Aug. 14, 2019)  (third party’s spoliation “imputed” to party absent any subpoena at all where spoliator was “not a disinterested non-party”).

Nor are we addressing third-party subpoenas directed against the federal government (such as the FDA).  These are governed by departmental regulations issued pursuant to United States ex rel. Touhy v. Ragen, 340 U.S. 462 (1951).  We addressed that issue, here.

The first place we tried, the Sedona Principles, downloadable here, turned out to be a dud.  The “meat” in the principles is in what are called “comments.”  Comment 5(a) has a section on “Preservation by non-party in response to Rule 45 subpoena,” which states:

Case law concerning the preservation obligations of a subpoenaed non-party in litigation is not well defined.  Some courts have noted that the issuance of a subpoena creates a duty to preserve.  However, since Rule 45 imposes duties on the requesting party and the court to shield a non-party from undue burden and expense, there may be some question whether an overbroad subpoena creates a duty to preserve.

Sedona Principles, Public Comment Version, at 44 (3d ed. 2017) (footnotes omitted).  The Principles simply suggest that a “good practice for the requesting party” is to “to engage the non-party in good faith discussions about the scope of the subpoena, sources of potentially responsive ESI, and the costs of preserving and producing relevant ESI.”  Id.

The footnotes cited one case, In re Napster, Inc. Copyright Litigation, 462 F. Supp.2d 1060 (N.D. Cal. 2006), but in that case the third-party subpoena target had, by the time sanctions were sought, been joined as a party.  Id. at 1065.  Further, the third–party target “acknowledged a duty to preserve documents . . . based on plaintiffs’ subpoena.”  Id. at 1068.  Thus the issue we’re interested in was effectively conceded in Napster.

The question seems to arise most frequently in connection with securities litigation subject to the stay provisions of the Private Securities Litigation Reform Act, which imposes preservation obligations only on “parties” during the duration of the stay.  15 U.S.C. §78u-4(b) (3)(C)(i).  Several courts have decided to improve upon the statute by permitting “preservation subpoenas” directed at third parties in order “to impose an affirmative duty on those parties to preserve the evidence.”  New York State Teachers’ Retirement Systems v. General Motors Co., 2015 WL 1565462, at *5 (E.D. Mich. April 8, 2015).  “[P]reservation subpoenas . . . impose[] a legal obligation on third parties to take reasonable steps to preserve relevant documents.”  In re Heckmann Corp. Securities Litigation, 2011 WL 10636718, at *5 (D. Del. Feb. 28, 2011).  In In re Tyco International, Ltd., Securities Litigation, 2000 WL 33654141 (D.N.H. July 27, 2000), such subpoenas would “give specified third parties notice of the action and impose upon them only a duty to preserve certain relevant evidence,” id. at *5, but had to be particularized, and could not “call for the preservation of an open-ended, boundless universe of materials.”  Id. at *4 (citation and quotation marks omitted).  Tyco relied on a similar order entered in In re Grand Casinos, Inc. Securities Litigation, 988 F. Supp. 1270 (D. Minn. 1997), holding that third-party subpoenas “would further Congress’ intent by subjecting relevant evidence to a ‘stay put’ directive . . . in [the hands] of third-parties,” which in turn strongly implied that a subpoena imposed a preservation duty on the third party receiving it..  Id. at 1272.  See Avenue Capital Management II, LP v. Schaden, 2015 WL 758521, at *3 (D. Colo. Feb. 20, 2015) (“preservation subpoenas . . . put those parties on notice of their duty to preserve certain documents”); In re Refco, Inc., 2006 WL 2337212, at *4 (S.D.N.Y. Aug. 8, 2006) (“courts have generally permitted plaintiffs in PSLRA actions to issue subpoenas [to] specified third parties [that] . . . impose upon them . . . a duty to preserve certain relevant evidence in their possession”).  None of these cases have involved any claim that a third-party’s preservation obligation extended to actions taken before any subpoena was received – indeed, the rationale is the opposite, these subpoenas are justified precisely to create the sought after duty.  See Neibert v. Monarch Dental Corp., 1999 WL 33290643, at *1 (N.D. Tex. Oct. 20, 1999) (“The only obligation imposed on the identified non-parties by the proposed subpoenas . . . is that they not destroy any records presently in their possession or which come into their possession at a later date”).

Similar results have occurred in a number of non PSLRA cases.  In City of Lindsay v. Sociedad Quimica y Minera de Chile S.A., 2012 WL 2798966, at *5 (E.D. Cal. July 9, 2012), the court assumed that it could hold in contempt “any third party that fails to comply with the issued subpoenas,” which assumes that such subpoenas necessarily impose a duty to preserve on a third-party recipient.  Id. at *5.  See In re Broiler Chicken Grower Litigation, 2017 WL 3841912, at *4 (E.D. Okla. Sept. 1, 2017) (“subpoenas to third parties [will] ensure that they too retain evidence”); Garcia v. Target Corp., 276 F. Supp. 3d 921, 925 (D. Minn. 2016) (“third-party subpoenas” mean that “third parties will be on notice of any obligation to preserve evidence”); Bright Solutions for Dyslexia, Inc. v. Doe 1, 12015 WL 5159125, at *3 (N.D. Cal. Sept. 2, 2015) (“the entities that have the information . . . are not parties and thus have no duty to preserve absent a court order”); Johnson v. U.S. Bank National Ass’n, 2009 WL 4682668, at *2 (S.D. Ohio Dec. 3, 2009) (third party subpoena obliges recipient “to describe responsive documents and protect them for subsequent production”); In re Rosenthal, 2008 WL 983702, at *8 (S.D. Tex. March 28, 2008) (third-party who “disregards a subpoena . . . may be found in contempt”).  Again, these cases all seem (in some, the discussion is quite brief) to focus on post-subpoena evidence.  See Swetic Chiropractic & Rehabilitation Center, Inc. v. Foot Levelers, Inc., 2016 WL 1657922, at *3 (S.D. Ohio April 27, 2016) (a “non-party . . . does not have a duty to preserve information absent a court order”); Koncelik v. Savient Pharmaceuticals, Inc., 2009 WL 2448029, at *2 (S.D.N.Y. Aug. 10, 2009) (it “is certain is that without preservation subpoenas, the third party corporations in possession of potentially relevant information are free to destroy that information”).

Some cases do suggest that no independent preservation duty arises even from receipt of a third-party subpoena.  Gambino v. Payne, 2015 WL 1823754 (W.D.N.Y. April 22, 2015), stated flatly that “the only duty under a subpoena to preserve materials is when the served party claims a privilege or protection from the subpoena and has to preserve the materials until the privilege or protection issue is settled.  Id. at *5.  In Comeens v. Harden Manufacturing Corp., 2014 WL 12650101 (N.D. Ala. April 3, 2014), the plaintiffs “fail[ed] to explain how issuing third-party subpoenas” would be any more effective at preserving documents “than the anti-spoliation letters [they had] already issued.  Id. at *2.  Goodman v. Praxair Services, Inc., 632 F. Supp. 2d 494 (D. Md. 2009), conducted an elaborate “control” analysis concerning allegedly spoliated documents held by a third party, id. at 515-16, that would have been entirely unnecessary if the third-party itself had a preservation obligation.  Id. at 516 (“conclud[ing] that [defendant] did not have the sufficient legal authority or practical ability to ensure the preservation of documents prepared by” the third party).  In Novak v. Kasaks, 1996 WL 467534, at *2 (S.D.N.Y. Aug. 16, 1996), the court separately ordered “that all non-parties upon whom subpoenas have been served in this action are to preserve all documents and other materials responsive to such subpoenas.”

Courts also tend to be more sensitive to burdens imposed on nonparties by overly broad third-party subpoenas.  Rule 45 itself requires requesting parties to “take reasonable steps to avoid imposing undue burden or expense on a person subject to the subpoena.”  Fed. R. Civ. P. 45(d)(1).  “[I]t has been consistently held that ‘non-party status’ is a significant factor to be considered in determining whether the burden imposed by a subpoena is undue.”  United States v. Amerigroup Illinois, Inc., 2005 WL 3111972, at *4 (N.D. Ill. Oct. 21, 2005) (citations omitted).  Thus, “[n]on-parties have a different set of [discovery] expectations” and “concern for the unwanted burden thrust upon non-parties is a factor entitled to special weight in evaluating the balance of competing needs.”  Cusumano v. Microsoft Corp., 162 F.3d 708, 717 (1st Cir. 1998) (citations omitted).  “[T]he undue burden calculus is more protective of non-parties than it is for parties.”  Charles v. Quality Carriers, Inc., 2010 WL 396356, at *1 (S.D. Ind. Jan. 28, 2010).

[T]he considerations of proportionality, efficiency, and judicial economy that govern the [subpoena] requests are case-specific. . . .  Plaintiffs have not identified any non-PSLRA case where a court lifted a stay while a motion to dismiss was pending to permit the serving of document preservation subpoenas on hundreds let alone thousands of third-parties covering a 10-year time period and thousands of products.

In re Broiler Chicken Antitrust Litigation, 2017 WL 1682572, at *5 (N.D. Ill. Apr. 21, 2017).  “[N]on-parties have greater protections from discovery and that burdens on non-parties will impact the proportionality analysis.”  Hume v. Consolidated Grain & Barge, Inc., 2016 WL 7385699, at *3 (E.D. La. Dec. 21, 2016) (quoting E. Laporte & J. Redgrave, “A Practical Guide to Achieving Proportionality Under New Federal Rule of Civil Procedure 26,” 9 Fed. Cts. L. Rev. 19, 57 (2015)).  “[T]he Court should be particularly sensitive to weighing the probative value of the information sought against the burden of production on the non party.”  Fears v. Wilhelmina Model Agency, Inc., 2004 WL 719185, at *1 (S.D.N.Y. Apr. 1, 2004).

[I]t is not [the subpoenaed persons’] lawsuit and they should not have to pay for the costs associated with someone else’s dispute.  Not only is it fundamentally unfair for non-parties to bear the significant litigation costs of others, but also if this Court were to allow litigating parties . . . to impose such a burden on non-parties, then the likelihood of cooperation by non-parties in the future would be placed in jeopardy.

Guy Chemical Co. v. Romaco AG, 243 F.R.D. 310, 313 (N.D. Ind. 2007).

We’ve discussed the law essentially straight up in this post.  In any given case we could find ourselves on either side of the issue.

Over the past few weeks, our loyal readers have descended into the “Stygian Depths” and then climbed to the “Elysian Fields” with us as we reviewed the 10 worst and 10 best cases of 2019.

If you found yourself wanting more information on these cases and their impact – perhaps with a side of CLE credit – we’re pleased to announce that four of your bloggers (Bexis, Steven Boranian, Steve McConnell, and Rachel Weil) will be presenting a free 90-minute webinar on “The good, the bad and the ugly: The best and worst drug/medical device decisions of 2019” on Friday, January 24 at 12 p.m. EST.

This webinar is presumptively approved for 1.5 general CLE credit in California, Illinois, New Jersey, Pennsylvania, Texas and West Virginia. For lawyers licensed in New York, this course is eligible for 1.5 credit under New York’s Approved Jurisdiction Policy.

The program is free and open to anyone interested in tuning in, but you do have to sign up, which you can do here.

We don’t often write about statutes of limitations because the cases tend to be fact bound and not all that illuminating on larger points of law and/or practice.  However, a case in California struck a chord with us recently because it highlights a point that we think every litigator should understand:  Tolling agreements should not and typically do not revive already-stale claims, and they should be drafted to leave no ambiguity about that specific point.  As the lawyers demonstrated in Rustico v. Intuitive Surgical, Inc., No. 18-cv-02213, 2019 WL 6912702 (N.D. Cal. Dec. 19, 2019), care in drafting can mean the difference between winning and losing.

Here is what you need to know.  The plaintiff underwent a surgical procedure on January 12, 2012, and experienced a complication that one surgeon purportedly attributed to “problems” and a “malfunction” with surgical equipment.  Id. at *1-*2.  Notwithstanding the complication, the plaintiff was discharged days later in good condition, and although she was seemingly no worse for the wear, she contacted an attorney in September 2013 after seeing a television advertisement.  Id. at *2.  The timing is obviously important—the plaintiff’s outreach to counsel was just a few months short of two years after her procedure.

As it turns out, attorneys for the device manufacturer had sent plaintiffs’ counsel a tolling agreement for cases involving the device, under which the tolling period would be triggered by notice from the plaintiffs’ lawyers.  Because the devil is in the drafting, we will lay out relevant terms verbatim:

[The agreement will] toll the applicable statute of limitations for a three month period starting on the date [Defendant] is provided with a claimant’s name.  If necessary, this period may be extended upon agreement of the parties. . . .

. . . .

The tolling of the applicable statute of limitations is not intended to and shall not for any purposes be deemed to limit or adversely affect any defense, other than a statute-of-limitations defense, that [Defendant] has, may have, or would have had in the absence of this agreement.  Nor does this agreement waive or release any statute of limitations defense that could have been asserted before the date of the tolling period.  Upon completion of the tolling period, [Defendant] will have all the defenses available to it as it had on the first day of the tolling period.

Id. at *2 (emphasis added).  The highlighted text at the end will become important because the plaintiffs’ attorney executed the tolling agreement on August 9, 2013, but did not send the plaintiff’s name (and thus commence the tolling) until February 3, 2014—more than two years after the plaintiff’s procedure.  Id. at *2.

You are no doubt starting to see how this played out.  The parties extended the tolling agreement again and again, until the plaintiff finally filed a complaint in the Northern District of California on April 13, 2018.  Was the claim time barred?  The answer was clearly yes, since by the time the plaintiff became a party to the tolling agreement, her claim was already untimely.

The district court’s order granting summary judgment for the defense came down to (1) choice of law, (2) the express terms of the tolling agreement, and (3) application of California’s discovery rule and doctrine of fraudulent concealment.

First, the district court determined that California’s two-year statute applied, rather than Connecticut’s three-year statute.  Although the plaintiff had her procedure in Connecticut, she resided in Florida and the Defendant was headquartered in California.  Id. at *1.  The district court therefore applied California’s “governmental interest” framework for choice of law, and it determined that because California was the forum and because the only defendant was a California resident, California was the only state interested in applying its statute of limitations.  Id. at *4-*7.  The discussion is long, but that’s the gist of it, and it left the plaintiff trying to evade California’s two-year statute.

Second, Plaintiff attempted to evade the statute by invoking the tolling agreement and arguing that the defendant was equitably estopped from asserting a statute-of-limitations defense.  This is where the tolling agreement spoke for itself.  The agreement did not prevent the defendant from asserting the statute because the claim was already untimely when the tolling period commenced.  Id. at *7-*8.  Recall that counsel signed the tolling agreement in August 2013, but did not give notice to commence the tolling until months later—in February 2014, which is more than two years later than the plaintiff’s alleged complication in January 2012.  The plaintiffs simply could not explain away the agreement’s express terms, under which the plaintiff became a party to the agreement on February 3, 2014, and the defendant expressly did “not waive or release any statute of limitations defense that could have been asserted before the date of the tolling period.”  Id. at *8-*9.  If there is one takeaway from this post, this is it.  The agreement’s clear language (and counsel’s faulty calendaring) made the difference.

Third, the plaintiff argued that California’s discovery rule and doctrine of fraudulent joinder delayed the accrual of her claims.  Id. at *12-*15.  But California’s discovery rule requires only inquiry notice for claims to accrue, and “so long as a suspicion exists, it is clear that the plaintiff must go find the facts; she cannot wait for the facts to find her.”  Id. at *12 (quoting Jolly v. Eli Lilly & Co., 44 Cal. 3d 1103, 1111 (1988)).  Plaintiff’s surgeon had told her and her husband that she experienced a complication and that there had been “problems” and a “malfunction” with the surgical equipment.  That was enough to find as a matter of undisputed fact that the plaintiffs knew or should have known, or at least had the suspicion, that they had a claim.  Id. at *13.  Finally, fraudulent concealment does not apply “if a plaintiff is on notice of a potential claim,” as the plaintiffs were here.  Id. at *14.

This is a good case to put away for reference.  The particular facts may not recur, and we express no opinion here on whether tolling agreements are a good idea.  Sometimes they are, and sometimes they are not.  If, however, you draft and execute one, be careful and be clear.

We had to shake our heads at the recent 360 story entitled, “Allergan Breast Implant Risk MDL Heading to New Jersey” – the link is here for those of you with a subscription.

The idea of a “risk” MDL seems bizarre.  The story involves a particular type of cancer, and states that “four proposed class actions” are being coordinated.  If it’s one thing that our federal and state class action cheat sheets teach, it is that class actions are inappropriate for cases involving personal injury.  Hence, it appears that the description of a “risk” MDL is shorthand for class actions alleging a “risk” of that type of cancer in persons who have never (and probably will never) be diagnosed.

But according to the story, at least some of these would-be class representatives have actually “fallen victim” to the cancer.  That’s another blatant class action no-no – actually injured persons cannot represent classes of purportedly “at risk” persons with no present injury.  E.g., Amchem Products, Inc. v. Windsor, 521 U.S. 591, 624 (1997) (“exposure-only plaintiffs especially share little in common, either with each other or with the presently injured class members”) (citation and quotation marks omitted).  Further, if (as the 360 article states) the plaintiffs are demanding that the defendant “cover the costs of removing and replacing” the products, there are no state-law claims for medical monitoring either, because (putting aside the many other individualized issues) medical monitoring is just that:  an action solely for costs of “monitoring,” not prophylactic treatment.  This kind of claim was tried, and roundly rejected, in the cases involving Shiley heart valves we list in our compensatory injury cheat sheet.

But it gets worse.

This isn’t your mother’s breast implant litigation.

Breast implants are now Class III pre-market approved (“PMA”) medical devices.

That means express preemption under Riegel v. Medtronic, Inc., 552 U.S. 312 (2008).  Even one of the worst post-Riegel preemption decisions recognized that 21 U.S.C. “Section 360k provides immunity for manufacturers of new Class III medical devices to the extent that they comply with federal law.”  Bausch v. Stryker Corp., 630 F.3d 546, 553 (7th Cir. 2010).  That’s a statement of the “parallel claim” exception to PMA preemption that courts have read into Riegel.

Back to the 360 article.  “The suits allege that [defendant] used a loophole in the U.S. Food and Drug Administration’s reporting requirements” and “it wasn’t until the agency tightened the requirements in 2017 that more adverse event reports came to light.”  Translation:  the complained-of reporting complied with the FDA’s requirements at the time, and when the FDA changed its requirements, the defendant changed its reporting to remain in compliance.  The complaints claim that, while “[m]anufacturers are supposed to report possible safety concerns about their products to the FDA through its public, searchable database” called “MAUDE,” the defendant instead “report[ed] them in so-called alternative summary reports, which are not required to be reported to MAUDE.”  Translation:  the defendant used an available, if “overlooked,” FDA reporting procedure to satisfy its legal obligation to report adverse events.  Or, as the FDA itself puts it on its website:

In 2017, the FDA began to sunset the ASR [alternative summary report] Program and requiring manufacturers with ASR exemptions to submit, in addition to the spreadsheet, a companion report that includes the total number of events being summarized.

We were also able to find the FDA’s – now withdrawn – guidance on alternative summary reports on its website, here.

Thus, it is readily apparent that the complaints don’t state any actual FDCA violation – only that the defendant, until 2017, had a choice as to how to report adverse events to the FDA, and chose the most streamlined route (allowing “submi[ssion] in a line-item format,” according to the then-applicable FDA guidance) available for meeting its FDA reporting obligations.  When the FDA “rolled out more rigorous reporting requirements in 2017,” the defendant also complied, which resulted in more public reports.

Thus, the plaintiffs in this “risk MDL” are claiming that, even though the FDCA did not obligate the defendant to use MAUDE reporting prior to 2017, some state common-law duty to use MAUDE existed and gave rise to tort liability.  What part of “different from or in addition to” (the preemptive language of §360k(a)) don’t these plaintiffs understand?  The claims described by 360 facially assert state-law reporting duties both “different from” FDA requirements (which at the time allowed “alternative summary reports”) and “in addition to” those same requirements.  What the 360 article reports isn’t even a “failure to report” claim – because at minimum that kind of claim asserts an actual violation of an FDCA reporting duty.  Again, this much is established even in cases we love to hate.  A failure-to-report claim:

alleges that, under federal law, [a defendant] had a “continuing duty to monitor the product after pre-market approval and to discover and report to the FDA any complaints about the product’s performance and any adverse health consequences of which it became aware and that are or may be attributable to the product.”  It further alleges that [defendant] failed to perform its duty under federal law to warn the FDA.

Stengel v. Medtronic Inc., 704 F.3d 1224, 1232 (9th Cir. 2013) (applying Arizona law) (emphasis added), overruled on state law grounds, Conklin v. Medtronic, Inc., 431 P.3d 571, 578-79 (Ariz. 2018).  Here, assuming the 360 article is accurate, no actual federal reporting violation is alleged.  At all times, the defendant’s reporting complied with what FDA regulations then allowed.  Sure, these plaintiffs don’t like what FDA regulations permitted – but that’s precisely why Congress imposes preemption in this type of case.

So our reaction to the “risk MDL” described in the 360 article is that:  (1) it can’t be a class action; (2) state law doesn’t provide the relief being requested; but in any event (3) the only common issue should be that the whole thing is preempted under Riegel.

How many of us entered law school dreaming of following the paths of Brandeis, Marshall, etc. in the field of constitutional law? How many of us now can go weeks, or even months, without reading a Supreme Court case? Paying off student loans led many of us to work for law firms where there was far less available to do in constitutional law than in, say, commercial disputes, securities, or product liability law. But we’re not mooning over the path not taken. Somewhere in that perineum between law school graduation and partnership, we learned that while constitutional law gets the headlines, it can also be in some ways, a less satisfying practice area. We don’t merely mean that it doesn’t pay as much, at least not reliably. The problem with constitutional law is that it turns too much on the predilections of a few judges, and turns too little on rules and realities. Statutory interpretation or antitrust analysis or a Daubert dispute demand rigor. Perhaps there is rigor in unwinding the doctrinal wanderings of First or Fourth Amendment law (and their “penumbras”), too, but politics and prejudice seem to take positions at the head of the line in those flashy areas. (There is currently an abortion case before the Supreme Court that asks whether a precedent set way, way back in 2016 should be overturned. Question: what has changed? Answer: politics and the makeup of the nine solons who get to tell us what the constitution means.).

Every once in a while, constitutional law intersects with other legal battlegrounds in interesting ways. Our blog, for example, has had multiple occasions to discuss the tension between the First Amendment and regulatory/judicial restraints on drug and device marketing. Now comes a brilliant, nervy law review article that examines this issue and makes some exciting proposals. The article is by Florida law professor Lars Noah, it appears in the Fall 2019 edition (volume 92) of the Temple Law Review, and is entitled, “Does the U.S. Constitution Constrain State Products Liability Doctrine?” The article is insightful and blessedly brief, so you should check it out yourself. We won’t step on too many of the article’s points, but here is a preview that we hope will inspire you to take a look at the article before you draft your next summary judgment brief.

Professor Noah begins by focusing on the dreadful decision by the New Jersey Supreme Court in the Perez case holding that the learned intermediary doctrine, which limits the duty to warn when selling prescription drugs and devices, did not apply whenever manufacturers had engaged in direct-to-consumer (DTC) advertising. The article boldly suggests that the rule announced in Perez might run afoul of the Constitution. After all, in cases such as Virginia State Board of Pharmacy and Thompson v. Western States Medical Center, the Supreme Court has applied the first amendment to limit government efforts to bar truthful and nondeceptive pharmaceutical advertising.

(The article reminds us that Perez involved a contraceptive. The New Jersey court apparently believed that the product “did not qualify as a therapeutically important product,” and seemed willing to carve out another exception to the learned intermediary doctrine for “lifestyle” drug and devices, whether or not directly advertised to consumers.)

Professor Noah points out that the DTC exception in Perez “plainly singles out for unfavorable treatment defendants that engage in commercial speech simply because some of the judges in that state have no use for the practice.” That sounds like content-related discrimination (both speaker- and topic-based) against certain speech.

The article does not confine itself to the Perez issue. It explores whether constitutional protection should extend to the marketing of certain products that implicate certain rights. Contraceptives – such as the product at issue in Perez – would be among those products, something we’ve noted here on the Blog. An analogy is drawn to the First Amendment’s requirement of tolerating some defamatory falsehoods in order to avoid chilling valuable speech. Why shouldn’t other fundamental rights (think of some of the most controversial SCOTUS opinions, such as Griswold, Roe, and Heller) require tolerating the “sale of certain arguably defective products lest suppliers become spooked about distributing even nondefective versions that individuals have a right to use“?

That is not an absolute principal; there aren’t that many absolutes in constitutional law. Professor Noah proposes that “Constitutional regard for ensuring the availability of certain products would not entirely insulate sellers, just as authors and publishers remain subject to defamation lawsuits, but it would necessitate imposing a higher pleading standard on plaintiffs. In order to really safeguard constitutionally valuable products, even allegations of negligence would not suffice, instead, courts should have to recognize a regulatory compliance defense.”

The article concludes that “[t]he time may have come to extend the U.S. Supreme Court’s drive to constitutionalize the domain of speech torts into the field of products liability.” That notion is intriguing not only because of its potential scope and consequences, but also because it is grounded in precedent and logic. At a minimum, we should ponder possible constitutional dimensions before we put the finishing touches on our dispositive motions.

We all know that absent extraordinary circumstances, failure to warn claims against generic drug manufacturers are preempted under PLIVA, Inc. v. Mensing, 564 U.S. 604 (2011).  But as far as we are aware, no other court has been asked to decide whether that same preemption applies to cross-claims for contribution or indemnity.  Until now.

In Haney-Williams v. GlaxoSmithKline LLC, 2019 WL 7284737 (D. Nev. Dec. 27, 2019), plaintiff filed a failure to warn claim against the manufacturer of a generic drug prescribed to treat her epilepsy.  She also brought claims against the pharmacy that filled the prescription alleging they gave her the wrong strength of the medication.  Plaintiff originally also sued the manufacturer of the brand name product, but dropped those allegations early on.  Id. at *1.

The pharmacy filed a cross-claim against the generic manufacturer for comparative negligence, equitable indemnity, and declaratory relief, along with some contract-based claims. Id.  The contract-based claims were dismissed because the contract had expired prior to plaintiff’s injury.  Id. at *5.  The generic manufacturer moved to dismiss both the direct action by the plaintiff and the contribution claims by the pharmacy as preempted.

The failure to warn claim was easily dismissed under Mensing after the court took judicial notice of the ANDA which identified the drug as a generic product, a fact that was omitted from the complaint.  Id. at *3.  The court then turned to the pharmacy’s cross-claims.  Under Nevada law, a comparative negligence claim provides that “each defendant is severally liable to the plaintiff only for that portion of the judgment which represents the percentage of negligence attributable to that defendant.”  Id. at *4.  Similarly, equitable indemnity “allows a defendant to seek recovery from other potential tortfeasors whose negligence primarily caused the injured party’s harm.”  Id.  Under both scenarios, recovery is only permitted from another tortfeasor.  Therefore, for the pharmacy to recover under either theory, there would have to be some way the generic manufacturer could be find liable.  Id.  But, because plaintiff’s sole cause of action against the generic manufacturer is preempted, the generic manufacturer cannot be found a tortfeasor and there can be no derivative claim.  As the pharmacy’s request for declaratory relief was derivative to its other claims, it too was dismissed.

The rationale is simple, straightforward and should apply in all preemption cases resulting in a complete dismissal of plaintiff’s claims, not just generic preemption.  A little surprising that it has taken this long to get this one in the books.  Granted it’s a twist we don’t see that often.  But if you do find yourself in this vexing situation, it’s good to know the law is on our side.


In their unending quest to make a plaintiff out of everyone, some creative members from the other side of the “v.” have concocted a claim that we call “fourth-party payor” liability.  Regular blog readers are certainly familiar with “third-party payor” actions brought – entirely for economic losses – by insurers, pension funds, and other organizations that are under obligations to pay for their insureds’/members’ health care costs.  They typically claim that, for one reason or another, our prescription medical product clients charged them too much for this or that product.

Fourth-party payor litigation goes a step beyond that.  In Enriquez v Johnson & Johnson, 2019 WL 5586557 (N.J. Super. Law Div. Oct. 10, 2019), the plaintiff never even claimed to have used the product, paid for the product, acquired the product, or had any interaction with the product (or its alleged manufacturers) in any way.  He was simply “a [state] resident who alleges that he purchased health insurance.”  Id. at *1.  Following the principle that “to err is human, but to really screw up the law, bring a class action,” this plaintiff sued the defendant manufacturer for allegedly driving up the cost of health insurance generally:

Plaintiff asserts that as a result of the conduct of Defendants, New Jersey health insurers paid higher costs for both [the defendant’s products and their alleged adverse reactions], resulting in increased costs to health insurers.  Plaintiff alleges that health insurers passed these higher costs on to their insureds, causing class members to pay higher costs for health insurance.

Id.  Like we just said – make everybody a plaintiff.

Fortunately, this theory of liability was a bridge too far.  A claim such as this, “brought by persons claiming to have paid higher insurance costs as a consequence of misconduct by manufacturers, distributors and marketers,” had never been brought before.  “There are no reported decisions directly on point.”  Id. at *2.  The Enriquez decision did its best to make sure this kind of suit is never brought again.

The liability theories were:  (1) violation of New Jersey’s Consumer Fraud Act (“CFA”); (2) public nuisance; (3)unjust enrichment; (4) negligent marketing; and (5) “negligent interference with prospective economic advantage.”  Id. at *4.  All of these theories made a mockery of anything resembling traditional causation:

Plaintiff . . . he would first obtain a sample of prescriptions . . . written by physicians.  Plaintiff asserts that it is unnecessary to explore each patient’s medical record for his evaluation.  From this statistical data, Plaintiff then would have an expert evaluate which prescriptions were appropriate and which should not have been written.  Presumably, Plaintiff then would determine a percentage of prescriptions . . . that should not have been written and extrapolate from that data to calculate the total unnecessary . . . prescriptions.  Plaintiff then intends to have an expert evaluate how the costs of the prescriptions they determine should not have been written impacted the amount charged to class members for health insurance.

Enriquez, 2019 WL 5586557, at *4 (emphasis added).

Consumer protection claims of fourth-party liability failed for reasons of remoteness and causation.  Following one of the firearms marketing cases that Bexis was involved in years ago, Enriquez held, “alleged harm in the form of increased costs for medical expenses which were merely derivative of injuries to others was too remote to support [a CFA] claim.”  Id. at *7.  As for causation:

A complete lack of any relationship between the defendant’s unlawful conduct and the plaintiff’s loss compels a finding of a lack of causation under the CFA.  In cases in which the alleged misrepresentation was made to a prior purchaser and not to a plaintiff asserting the CFA claim, courts have held there was a fatal lack of proof of a causal connection between the misrepresentation and the alleged loss.

Id. at *8 (citations omitted).  Such precedent controlled this case, where only indirect economic effects were alleged:

Defendants had no contact with Plaintiff, and did not make any misrepresentations or omissions to Plaintiff.  Rather, the allegations are that Defendants’ misrepresentations and omissions were made to doctors for the purpose of increasing the volume of prescriptions written, and to health insurers for the purpose of obtaining approval of their pharmaceuticals on the formulary list. . . .  Plaintiff’s causal theory, that if Defendants had not marketed [their products] aggressively to doctors and health insurers the rate paid by Plaintiffs and other proposed class members for health insurance would have been lower, is speculative and attenuated.

Id. (citations and footnote omitted).  “Speculative and attenuated” – that is the takeaway from Enriquez.  “There is no allegation Plaintiff was aware of Defendants’ misrepresentations before he purchased health insurance, or that even if Plaintiff was aware he did not have the option to switch to a provider unaffected by Defendants’ misrepresentations.” Id. at *9.

Public nuisance also failed under New Jersey precedent from the firearms marketing cases.  Preclusion of fourth-party payor liability was a fortiori from that litigation .  “Public nuisance claims are typically restricted to those connected with real property or the infringement of public rights. . . .  [N]o New Jersey court has ever allowed a public nuisance claim to proceed against manufacturers for lawful products that are lawfully placed in the stream of commerce.”  Enriquez, 2019 WL 5586557, at *10 (quoting and following Camden County Board of Chosen Freeholders v. Beretta, U.S.A. Corp., 273 F.3d 536, 539-40 (3d Cir. 2001)).  Enriquez also followed (at *11) In re Lead Paint Litigation, in which the New Jersey Supreme Court noted, as to public nuisance:  “Whether these plaintiffs . . . are authorized to sue for damages, instead of seeking abatement, is debatable.”  924 A.2d 484, 502 n.10 (N.J. 2007).  Thus:

Typically, a suit involving a public nuisance is sustainable only by a suit brought by a governmental entity or an individual who sustains some special damage over and above that suffered by the general public.  Here, the allegations of the Complaint do not demonstrate or allege the type of special injury which would allow an individual as opposed to a public entity to bring an action seeking monetary damages resulting from an alleged public nuisance.

Enriquez, 2019 WL 5586557, at *11 (citation omitted).

Unjust enrichment simply had nothing to do with fourth-party liability – since the plaintiff never paid anything to the defendant manufacturers.  Once again,

Unjust enrichment is not an independent theory of liability. . . .  Plaintiff can point to no direct benefit received by any Defendant from Plaintiff.  Rather, any benefit Plaintiff conferred was directed to his health insurer.  The facts presented are far too remote to permit a cause of action based upon unjust enrichment to proceed.

Id. at *12 (citations omitted).

The fourth-party aspects of negligent marketing also foundered on the rocks of remoteness.  A product marketer’s duty of care has never extended to persons with no need for the product, and to whom no marketing was directed.

Plaintiff’s Complaint alleges that Defendants had a duty to exercise reasonable care in manufacturing and distributing [their] medications in the State of New Jersey.  The critical issue presented here however is how far that duty extends.  There is no doubt that this duty extends to individuals likely to purchase [those products].  Conceivably, that duty could extend to a non-patient purchasing the [products] who is not a consumer.  Consumers of health insurance however are simply far too remote from the conduct of Defendants to find a duty to exist as a matter of law.  The nature of the risk to consumers of health insurance is too far removed, and any risk too attenuated, to find as a matter of fairness that a duty should extend to such outer limits.

Enriquez, 2019 WL 5586557, at *13 (emphasis added).

Finally, “tortious interference with prospective economic advantage” is a claim we’ve never seen raised before in product liability litigation.  Opportunity costs – to the extent that’s even “a thing” in product liability – have been addressed by pre-judgment interest.  In New Jersey, that cause of action was not viable.  “No reported decision has recognized a cause of action for negligent interference with prospective economic advantage.”  Id. at *13.  The closest thing in New Jersey law was for “tortious interference with a prospective business relation.”  Id.  That was obviously not an issue in Enriquez.  “While Plaintiff alleges that the conduct of Defendants impacted the price which they paid for health insurance, health insurance was not the business of Plaintiff.”  Id.

Having rejected each of the plaintiff’s causes of action, Enriquez then bounced the rubble by holding that plaintiff also failed to allege proximate cause.  “It is not enough to show a fraud on the marketplace.”  Id. at *16.  But general, overarching allegations of fraud untethered to any particular plaintiff were all that fourth-party payor liability offered – or could offer:

Plaintiff cannot establish an ascertainable loss through statistical data as proposed.  This is essentially a fraud on the market theory which has been rejected as a basis to establish an ascertainable loss in a claim based upon the CFA. . . .  Plaintiff’s proposal to prove the increased costs of [these products and their alleged adverse effects] through statistical data, and then further establishing its impact on the cost of health insurance with statistical data, essentially constitutes a fraud on the market theory to prove damages which has been rejected in this state.

Enriquez, 2019 WL 5586557, at *16 (citation omitted).

Finally, Enriquez inspired us to name this bogus cause of action with its observation that “[t]his case is most similar to, although one step further removed from, third party payor actions which have been routinely dismissed by courts as failing to establish sufficient causation.”  Id. at *19.  What’s “one step” beyond “third party payor” actions?  Fourth-party payor liability.  Tort liability such as this is simply not a way to fix the rising cost of healthcare:

There are a myriad of reasons . . . which have an impact on insurance costs.  Some costs may be borne by insurers resulting in lower profits, some may be paid by employers and some may be passed on to the purchasers of health insurance.  These costs may also be subject to higher co-pays, deductibles or limitations of coverage, Plaintiffs argument that statistical data can be used to determine what increases were the direct cause of Defendants’ actions, and what increases are attributable to other factors, is inadequate to establish the facts required.

Id. at *20.  Thus, “this particular proposed class are simply not the appropriate vehicle to vindicate the rights of those who have been impacted by the alleged conduct of Defendants.  The alleged harm to Plaintiff is far too attenuated and remote.”  Id.

Fourth-party payor liability is to the law what the fourth dimension is to daily life.  It doesn’t exist, and even if it did, it would too remote to for the law (or daily life) to address.

This post is solely by the non-Reed Smith side of the Blog.

There are lots of great pairings.  Bud Abbott and Lou Costello.  Paul Simon and Art Garfunkel.  Michael Jordan and Scottie Pippen.  Michael Scott and Dwight Schrute.  Rum and coke.  Chocolate and peanut butter.  Chocolate and pretzels.  Chocolate and strawberries.  Chocolate and wine.  We think you get the point.  But for every great duo, there is a great don’t.  Oil and water.  Texting and driving.  Water and electricity.  Toothpaste and orange juice.  These are things to stay away from. Now Andrusis v. Microvention, Inc., 2019 Pa. Super. Unpub. LEXIS 4759 (Pa. Super. Dec. 26, 2019), tells plaintiffs not to mix malfunction theory strict liability with medical malpractice negligence.

Plaintiffs’ decedent underwent surgery to repair an aneurysm.  Decedent’s surgeon used a microcatheter with defendant’s product.  But the product was larger than what was recommended for use with that particular microcatheter.  The relevant Instructions for Use contain strict time frames for repositioning once the product is introduced and recommends removal if they cannot be positioned properly within the time period.  Because the doctor was using a two devices that were not intended to be used together, he selected his own targeted time period for repositioning.  Ultimately, the surgeon could not complete the surgery successfully.  Complications occurred and decedent died a day later.  Id. at *2-4.

While plaintiffs filed suit against the surgeon, hospital, and the product manufacturer, the only claim actually pursued against the manufacturer at trial was a cross-claim filed by the hospital.  Id. at *5.  At the conclusion of plaintiffs’ case-in-chief, defendants informed the court they had reached a settlement and would not be providing evidence against the manufacturer, which left the plaintiff with no case as to that defendant.  The manufacturer moved for a compulsory nonsuit since plaintiffs presented no evidence of a product defect.  It was denied but renewed at the close of defendants’ case at which time it was granted.   After a jury verdict in favor of the surgeon and hospital, plaintiffs appealed.  Id. at *23-24.

Plaintiffs argued that the jury should have been given the strict liability claim because there was sufficient evidence to support a malfunction theory strict liability claim.  The malfunction theory allows a plaintiff to prove a product defect with both evidence of a malfunction and “evidence eliminating abnormal use or reasonable, secondary causes for the malfunction.”  Id. at *26.  It is a case built on circumstantial evidence and that is why it requires both evidence to show that a malfunction occurred and evidence of no other reasonable causes.  Only then will a court allow a jury to infer that a defect caused the injury.  Id.

The appellate court presumed that plaintiffs had provided sufficient evidence that a malfunction occurred.  Note that the trial court did not so conclude because the claimed product failure was a “rare, but foreseeable risk” and a known possibility could not be evidence of a malfunction.  Id. at *28 n.10.

The appellate court focused on the second element of a malfunction theory – other causes.  The court held that for plaintiff to pursue a malfunction theory, plaintiff “must present a case free of abnormal use and secondary causes.”  Id. at *30 (citation and quotation marks omitted).

[I]f the plaintiff’s theory included facts that the plaintiff was using the product in violation of its directions . . . no reasonable jury could infer that an unspecified defect caused a malfunction when either (1) the more likely explanation is the abnormal use or (2) the facts presented by the plaintiff suggest a cause for the malfunction unrelated to the alleged, unspecified defect.

Id. at *30-31.

In this case, plaintiffs’ entire theory of the case was that the product did not malfunction, but rather it was the surgeon’s negligence, including his failure to follow the product’s directions, that caused decedent’s death.  Plaintiffs wanted to rely on the medical malpractice defendants’ defense.  Of course the surgeon argued there was no misuse.  Plaintiffs argued that if the jury accepted that defense argument, it would have eliminated the alternative cause and therefore they should be allowed to proceed on a malfunction theory.  But, Pennsylvania law requires plaintiff’s case be “free of abnormal use and secondary causes” to “establish a prima facie malfunction theory case sufficient to proceed to the jury.”  Id. at *31-32.  Not true here.

Plaintiffs also argued that pursuing a medical malpractice theory did not preclude them from pursuing the alternative malfunction theory.  In principle, they are correct.  In application to the facts, not as much.  The case plaintiffs rely on is Rogers v. Johnson & Johnson, 565 A.2d 751 (Pa. 1989), in which at trial plaintiff presented evidence that eliminated medical malpractice as the cause of his injury and he proceeded with a malfunction theory case against the manufacturer of a plaster splint.  Defendant manufacturer’s expert evidence supported that it was malpractice that caused the injury.  The question was whether the malfunction theory should not have been submitted to the jury based on the defense evidence. The Pennsylvania Supreme Court said no:  “[W]e believe that so long as the plaintiffs presented a case-in-chief free of secondary causes which justified the inference of a defect in the product, the jury was free to accept their scenario.”  Rogers, 565 A.2d at 755.

But Rogers was the exact opposite of plaintiffs in Andrusis, who attempted to “back-door” a malfunction theory claim through defendants’ evidence that failed to materialize because of the settlement.  Because a malfunction-based claim is a form of circumstantial evidence of a defect, it is defeated where plaintiff’s own case, as here, contains evidence of a reasonable secondary cause of the malfunction – such as a surgeon’s abnormal use of the product.  Plaintiffs attempted to turn their medical malpractice case into a products liability case by relying on a co-defendant doctor to make out the case against the manufacturer.  Fortunately, the court saw the ploy for what it was and held plaintiffs to their case-in-chief.  So, if you see medical malpractice and malfunction theory together, remember it’s not Bogie and Bacall.  Think more Schwarzenegger and DeVito.

There is an exhibition at the National Museum of the American Indian in Washington DC showing a warrior with eyes on the back of his head and a blank, eyeless face on the front. That odd image reflects the profound truth that we have seen what has already happened but are blind to the future. (We are reminded a bit of Dr. Bunsen Honeydew, the muppet character who has no eyes. But Dr. Honeydew does have glasses. Talk about odd.)

At the start of 2020 we can only guess as to the coming triumphs and indignities. The calendar has turned but we find ourselves still looking backwards at some of the drug and device law developments in 2019. Bexis shared the 2019 top 10 and bottom 10 lists. (Keep alert for the upcoming CLE program.). Even aside from the positive and negative game-changers of 2019, there were other cases with interesting holdings. We did not get to them all. Some are worth retrieving, holding up to the light, and scrutinizing.

For example, Hofer v. Wright Medical Technology, Inc., 2019 WL 3936130 (S.D. Cal. Aug. 20, 2019), takes us back. The date of the decision takes us back to a birthday dinner for the Drug and Device Law Son in Budapest. The location of the decision takes us back to our first years as a practicing attorney, when we worked on transactional matters in San Diego and proved on a daily basis our ineptitude in drafting trust indentures and other triple-tier finance documents. Most important, the substance of the Hofer decision takes us back to the days when courts took seriously the requirement under Fed. R. Civ. P. 9(b) that plaintiffs must plead fraud claims with particularity.

The plaintiff in Hofer claimed injuries from an artificial hip system that broke into pieces. His complaint included causes of action for failure to warn, negligence, and negligent misrepresentation. The defendant moved to dismiss the negligent misrepresentation claim because it flunked the heightened pleading requirement of Rule 9(b). The defendant prevailed, and the court’s reasoning might be a gift to defendants accused of negligent misrepresentation.

The plaintiff first argued that Rule 9(b)does not apply to negligent misrepresentation. Surprisingly, the Ninth Circuit has not addressed this legal issue. It is hard to believe that, as big as the Ninth Circuit is, the issue has not already been resolved. But it has been resolved at the district court level in the Southern District of California several times, and those sun-blessed judges have consistently applied Rule 9(b) to claims of negligent misrepresentation. Maybe the Ninth Circuit will review the question. Unlike some (most?) other commentators, we do not assume that the Ninth Circuit would mangle the law in a pro-plaintiff fashion. Maybe it is because we clerked on the Ninth Circuit in our salad days, but we foresee a solid affirmance. The Ninth Circuit has a lot of smart judges (and, with the recent addition of our old AUSA colleague Dan Collins, maybe the one of the very smartest). Then again, we are like that Native American warrior, gazing into the future with more hope than vision.

The Hofer plaintiff argued that even if Rule 9(b) governed the case, his complaint satisfied it. No, it didn’t. The complaint referred to various marketing materials that hawked the hip implant’s record of success. But the only representation that the plaintiff alleged had been relied upon by the implanting doctor was that the hip implant system “was properly cleared by the FDA and that it had a good clinical history.” It runs out that there would be problems with these representations. It does not matter. The plaintiff “failed to allege who made any of these representations, when and where any of the representations has been made, and how they were made.” Moreover, the not allege whether or how the alleged misrepresentations has affected the doctor’ s “decision regarding his selection of the device.”

Accordingly, the court dismissed the negligent misrepresentation claim for failure to meet the heightened pleading requirement of Rule 9(b). In the midst of exchanging hearty New Year’s wishes, let’s not forget some of the cases that made 2019 as good as it was. Hofer in its own quiet way, was one of them.