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It took us a long time to understand how off-label promotion of prescription drugs had anything to do with the False Claims Act, and we’re still not so sure that the two are a fit. The FCA penalizes anyone who presents, or causes to be presented, to the federal government “a false or fraudulent claim for payment or approval.”  31 U.S.C. § 3729(a)(1).  Easy, right?  As we explained just last month in this quick primer on the FCA, Congress enacted the FCA after the Civil War to curb abuses in government procurement.  That part we get.  If you sell the Army 1,000 horses and send them a bill for 2,000 horses, that’s a false claim.

We’re writing about this today because the First Circuit issued an opinion last month that comes to the correct result and also illustrates how FCA claims are alleged in connection with off-label promotion—and how they fail. In Lawton v. Takeda Pharmaceuticals Co., No. 16-1382, 2016 U.S. App. LEXIS 20943 (11th Cir. Nov. 22, 2016), a patent lawyer filed a qui tam action against the manufacturer of a prescription diabetes medication.  He did not actually use the medication, nor did he buy or sell it.  So what did he allege?  He alleged that the manufacturer engaged in an elaborate scheme to promote the drug for un-approved uses—off-label promotion—and that the manufacturer thereby induced medical providers to make allegedly false claims for reimbursement to Medicare and Medicaid. Id. at **4-7.

It’s a two-step process. The manufacturer did not itself make a false claim, but rather engaged in alleged conduct that induced someone else to make a claim, whether the claimant knew it was false or not.  The problem for the plaintiff (or more accurately, the “relator”) is that he alleged neither falseness nor a claim.  We call that a double whammy.  Or maybe it’s a double fault.

Continue Reading This Is How A False Claims Act Case Works—And Fails

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Well that was something. When we left you last Thursday, the jury for the third bellwether trial in the Pinnacle Hip Implant MDL had just started its deliberations, and we once again expressed concern over the trial’s evidentiary and procedural rulings and the effect they might have on the verdict. Our concern-level was high. Last time, amidst similar concerns, the jury came back with a half-billion dollar verdict.

Apparently that was chump change. Everything is bigger in Texas. And this time it was over one billion. Let that sink in. Over one billion. That’s a massive amount of money. Has anyone even ever won that in a lottery? It’s 1,000 winners of Who Wants to Be A Millionaire. And then you have to add about 40 more winners because the actual verdict was about $1.04 billion.

Continue Reading The One-Billion-Dollar Verdict

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It is always nice to win a case, whether by motion or trial. But just in terms of pure exhilaration, it is hard to beat hearing the jury foreperson announce that, after a hard-fought trial, you win. But note that term “hard-fought.” Most trials really are hard. They really are expensive. They really are stressful. The road to even the most resoundingly wonderful verdict probably had a couple of nasty potholes. That was the case with Horrillo v. Cook Inc., 2016 U.S. App. LEXIS 21026 (11th Cir. Nov. 23, 2016). Prior to trial, there was at least one Daubert ruling that couldn’t have pleased the defense. Also, as reported by our friends in the Abnormal Use blog, there was a learned intermediary ruling that we do not like one bit. But all’s well that ends well, right?

In Horrillo, the plaintiff brought a product liability action on behalf of his deceased mother, who had undergone a surgery to clear her renal artery. The surgery went terribly wrong, as the patient sustained a stroke. The opinion also does not tell us whether the plaintiff ever sued the doctor. The surgeon used a stent manufactured by the defendant. That stent was designed for use in bile ducts, but the surgeon used it off-label in this case. That off-label use was apparently not all that uncommon. The plaintiff’s legal theories included negligence and negligent failure to warn, strict products liability and strict failure to warn, and breach of warranty. After a nearly four-week trial, the jury returned a verdict in favor of the defendant. The plaintiff then moved for a judgment notwithstanding the verdict, or, in the alternative, a new trial. The trial court denied those motions, and the plaintiff appealed to the 11th Circuit. Applying the appropriate standards of review, the 11th Circuit affirmed the trial court’s rulings and the defense verdict.

Continue Reading 11th Circuit Upholds Stent Defense Verdict

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It’s been two years since we applauded the downfall of Azzarello in Pennsylvania. Two years since the Pennsylvania Supreme Court ruling in Tincher v. Omega Flex, Inc., 104 A.3d 328 (Pa. 2014). Two years since we opined that we didn’t think Tincher changed Pennsylvania law applicable to prescription medical products much at all. After all, Hahn v. Richter, 673 A.2d 888 excluded prescription medical products entirely from Azzarello strict liability twenty years ago, so Tincher’s reworking of strict liability shouldn’t be of much consequence. And, our prediction has largely held true. We really haven’t mentioned Tincher much since here on the DDL blog, other than to point out the serious flaws in plaintiffs’ attempts to argue that Tincher somehow altered Pennsylvania’s negligence-only standard for prescription medical product litigation and that plaintiffs’ theory had been rejected by the first courts to consider it.

Now, two years later, we have to report that a Pennsylvania federal court used Tincher to allow a strict liability manufacturing defect claim to proceed in a medical device case – in what we view as a misconstruction of both Tincher specifically and Pennsylvania products liability law (especially post-Lance) generally.

The case is Wagner v. Kimberly-Clark Corp., slip op., No. 16-4209 (E.D. Pa. Dec. 1, 2016). During the installation of a feeding tube, a piece of the tube came off in plaintiff’s stomach and she had to undergo several procedures to have to have it removed. Wagner, slip op. at 2-3. Plaintiff’s complaint brings claims for negligence, strict liability, and breach of warranty. Defendant moved to dismiss the latter two claims. Id. at 1. Plaintiff did not oppose dismissal of the breach of warranty claim. Id. at 13. As for strict liability, the court dismissed strict liability design defect and failure to warn on the ground that neither is allowed under Pennsylvania law for prescription medical products. Id. at 6 n.3. But the court was unwilling to find the same was true as to plaintiff’s strict liability manufacturing defect claim.

Continue Reading Pennsylvania Federal Court Uses Tincher to Find Claim for Strict Liability Manufacturing Defect in Medical Device Case

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We blogged about possibly interesting nuggets in the 21st Century Cures Act (“21CCA”) back in February, 2015 – when it was only 400 pages long.  In true congressional fashion, it’s now twice as long and loaded up with enough goodies (mostly of the $$$ variety) that it just passed the House of Representatives by a 392 to 26 margin.  It thus seems poised to become law.  Given the prospects for imminent passage, we decided to revisit this monster and see if there’s anything more of interest to product liability defendants.  We aren’t interested in the spending-related aspects of this bill, which are what’s really greasing its skids.

So here goes.

Preemption

The first thing we wanted to see is if there is any preemption of civil lawsuits, so we searched the text of the bill for the word “state.” More than 100 matches.

Continue Reading Anything Worthwhile For Product Liability Defendants In The 21st Century Cures Act?

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As we head into December, there is quite a bit of attention being paid to when sales start, when shipping occurs, and when gifts are given.  Were one concerned with such an inquiry, one might imagine a few different points in time when gifting might commence.  For purposes of our space-filling exercise, assume the putative gift is tangible, labeled to identify the intended recipient, wrapped such that it must be opened to reveal its contents, and left in a place where the intended recipient is expected to retrieve it.  Has gifting commenced when the giftor leaves the gift in this place, even if it might be removed before the giftee assumes possession?  Need there be some last clear chance when the gift can no longer be removed or replaced with something else before the giftee claims it?  Must there be a direction like “open it” to signal an exchange?  What if the gift has labeling that states that it cannot be opened for another six weeks or so?  If the “gift” is merely a box containing a note that an actual gift will be forthcoming, then was there a gift at all?  What if we droned on and on?

Goldthrip v. DePuy Orthopaedics, Inc., __ Fed. Appx. __, 2016 WL 6933450 (11th Cir. Dec. 28, 2016), involves these exact same issues if one can consider a product liability lawsuit a gift and an Alabama courthouse a suitable place for receiving such a gift.  In Goldthrip, the plaintiff alleged that her implanted prosthetic hip manufactured by defendants injured her on December 25, 2013.  As this was a day when many Alabamians were exchanging gifts, we can guess that the timing of the injury was easy to identify.  The plaintiff filed her case on December 23, 2015, two days before the statute expired and another day of mass gifting.  Her complaint, however, came with a curious note, indicating that she was “‘withholding service of process’ in an effort to avoid expenses and facilitate settlement discussions.” Id. at *1.  The complaint was served on the defendant (without a summons) a week later, a summons was issued about six weeks after that, and the defendant was served with the summons sometime later.  (If you are wondering, Fed. R. Civ. P. 4(c) provides that “A summons must be served with a copy of the complaint. The plaintiff is responsible for having the summons and complaint served within the time allowed by Rule 4(m) and must furnish the necessary copies to the person who makes service.”  Service of the summons and complaint together, absent waiver, is necessary to get things started in federal court.)

Continue Reading Dispensing With Commencing: A Statute of Limitations Gift

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This post comes from the Cozen O’Connor side of the blog.

After two months, the third bellwether trial in the Pinnacle Hip Implant MDL is coming to an end. The jury heard closing arguments yesterday and began deliberating late in the afternoon. They start up again this morning.

Much like the second bellwether trial, this trial was not without controversy. The signs were ominous before it began.  Two weeks before trial, the court issued a sua sponte order consolidating six separate plaintiffs for the trial, close to any defendant’s worst nightmare. The court also ruled that plaintiffs could serve notices that would require company witnesses who were outside the geographic reach of the court to nonetheless testify live via satellite. Defendants could not substitute trial depositions for the satellite testimony, even though trial depositions had already been taken, complete with cross-examination of the witnesses by plaintiffs’ counsel. This order was sufficiently controversial that a Fifth Circuit judge, while concurring with his colleagues’ decision to reject defendants’ writ of mandamus challenging the order, chose to issue a one-sentence concurring opinion saying that the MDL judge got it wrong.

Continue Reading Buckle Up: The Jury Is Out in the Pinnacle Hip Implant MDL’s Third Bellwether Trial

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Many years ago, we represented a client in a quandary.  (We know, we know: that’s pretty much always the case.)  The product had been sold for many decades, the early history was important in marshalling a defense, and there were no employees around who were percipient witnesses.  What was the solution?  We made an employee an expert on the history of the product.  Voila!  The good part of that approach is that the witness would be free to talk about product issues predating his involvement (or, indeed, his birth).  The bad part was that much of the preparation work with the now-expert might no longer be shielded by the attorney-client privilege.

Federal Rule of Civil Procedure 26(a)(2) addresses that odd creature of the expert witness who was not retained or specially employed to provide expert testimony.  Think of, as in the instance mentioned above, a company employee whose job is mostly not devoted to rendering expert testimony.  Or think of treating physicians.  Rule 26(a)(2)(B) provides that an expert witness must provide an expert report “if the witness is one retained or specially employed to provide expert testimony in the case or one whose duties as the party’s employee regularly involve giving expert testimony.”  By contrast, Rule 26(a)(2)(C) provides that for witnesses who are not required to provide a written report – i.e., those not included in Rule 26(a)(2)(B) – the proffering party need only disclose the subject matter of testimony and “a summary of the facts and opinions to which the witness is expected to testify.”  We all know that treating physicians do not need to provide expert reports.  We couldn’t make them do it.  We probably could make employee/experts do a report, but under Rule 26(a)(2)(B), we don’t need to do that.  But to what extent does the attorney-client privilege shield our prep work with that employee/expert under that rule?

Continue Reading Attorney-Client Privilege Held Not to Apply to Nonreporting Employee/Expert

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People supplement a lot of things. You can supplement your diet with a multivitamin. You can supplement your income with a part-time side job. On the DDL Blog, we are always supplementing our scorecards and cheat sheets. Generally speaking, supplement is a pretty common word and has a fairly universally accepted definition. A supplement is an add-on. Something you do to make something more complete. Does the food you eat contain vitamins and minerals? Sure. But that multivitamin adds to it. It’s a boost.

In litigation too, we do a lot of supplementing. In fact, we are required to do so. Federal Rule 26(e) requires a party to supplement its discovery responses if it “learns that in some material respect the disclosure or response is incomplete or incorrect.” This duty to supplement extends to expert reports as well. Fed.R.Civ.P. 26(e)(2). But what does it mean to “supplement” an expert report? And when does supplementing to make a correction or completion go too far?

Plaintiffs got the answer to that question in U.S. ex. rel. Brown v. Celgene Corp., 2016 U.S. Dist. LEXIS 156826 (C.D. Cal. Aug. 23, 2016). Plaintiff-Relators brought a False Claims Act and Medicare Anti-Kickback Statute case against defendant alleging it illegally marketed Thalomid and Revlimid off-label and paid kick-backs to physicians for prescribing off-label. Id. at *6. The court set a deadline for the expert reports and relators timely served a report from their damages expert. Shortly thereafter, however, relators sought leave to supplement that expert report based on late produced Medicare data. Id. at *6-8. Relators wanted to time to analyze the data and supplement the report with that analysis. Relators also represented that while the supplement would be based on new data, the opinions were not expected to differ significantly. Id. at *8. The court granted the leave requested. Defendant was likewise given an opportunity to amend its expert reports in rebuttal and relators’ expert was deposed after his supplemental report was served. Id. at *11.

Continue Reading Plaintiffs Learn Supplementing Isn’t a Second Bite at the Apple

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A lot of companies rely on retired and otherwise former employees for information in litigation – including product liability litigation. Particularly where a product (such as a drug that’s now gone generic) has a long history, they are often the best source of knowledge about what happened years ago.  In dealing with ex-employees, however, defendants must keep in mind that, for purposes of the attorney/client privilege, discussions with ex-employees are subject to being treated much differently (and less protectively) than corporate communications with current employees.

The recent case, Newman v. Highland School District No. 203, 381 P.3d 1188 (Wash. 2016), although not involving prescription medical products, or even product liability, is a cautionary tale.  The defendant in Newman was a governmental entity, a school district.  The plaintiff alleged that he suffered a brain injury playing high school football, and that the injury occurred because the plaintiff was allegedly allowed to play in a game the day after suffering a concussion in practice.

The plaintiff in Newman didn’t sue until some three years after the injury. Id. at 1189-90.  By then, most of the coaching staff had turned over, and the individuals with the best knowledge of what had happened were employed elsewhere.  The school district’s litigation counsel contacted the ex-coaches and when they were deposed, claimed to represent them.  Id. at 1190.  Plaintiff challenged that representation as a conflict of interest and “sought discovery concerning communications between [the defendant] and the former coaches.”  Id.  The defendant resisted discovery with a claim of attorney/client privilege, and plaintiff opposed.  The defendant lost, and appealed denial of its motion for a protective order.  Id.

Continue Reading A Reminder To Be Careful With Ex-Employees And Confidential Information

Drug & Device Resources

Bexis’ Book

FDA-regulated products now account for an estimated one-fifth of overall economic activity in the U.S. They have also been the focus of a litigation explosion. This timely guide covers all aspects of litigation involving drugs, medical devices, vaccines and other FDA-regulated prescription products.
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