Parisian in the Spring, and the Winter of Our Discontent

By Stephen McConnell on March 26, 2012

With the arrival of Spring, we flipped the mattresses, moved the snowblower behind the lawnmower, and refilled the bird-feeder. We sprayed deer repellent on the tulips. It did not work, but at least now our front yard smells like coyote urine. Sadly, our poor plantings, unlike the daisies and violets in Shakespeare’s “Spring,” shall never “paint the meadows with delight.” We also made a brief pilgrimage to Clearwater, Florida to view the 2012 version of the Phillies. Hope Springs eternal. Yes, Spring brings taxes. And Spring brings mud. But Spring mostly brings good things.
Spring was only a day old when we received yet another judicial opinion curtailing the purported testimony of that World’s Foremost Authority, Suzanne Parisian. On March 21, 2012, Judge Graham Mullen ruled on Novartis’s Daubert motion in a Zometa case, excluding large portions of the opinions of Dr. Parisian. Lemons v. Novartis Pharms. Corp., No. 3:08-cv-00361 (W.D.N.C. Order March 21, 2012). We’re not stalkers or anything like that, but you probably know that we’ve been compiling a list of Dr. Parisian’s recurring performances as a plaintiff’s expert, with a view toward highlighting those courts that decided Dr. Parisian was not qualified or that her opinions flunked Daubert, Frye, Fraubert, or the judicial smell-test. The Lemons case comes out of the Aredia-Zometa MDL. Judge Mullen refused to preclude the entirety of Dr. Parisian’s opinions. It goes without saying that the authors of this blog would have granted the defense motion in a nanosecond. Heck, Bexis would probably have ordered the witness manacled and placed in an orange jumpsuit.
Continue Reading Parisian in the Spring, and the Winter of Our Discontent

Updates

By Bexis on March 23, 2012

Here are a few updates to some of our previous posts.
First, we posted about In re Aspartame Antitrust Litigation, ___ F. Supp.2d ___, 2011 WL 4793239 (E.D. Pa. Oct. 5, 2011), as we considered the case a promising development insofar as taxation of costs of production could exercise a restraining influence on the out-of-control cost and scope of ediscovery. Well, we’d be remiss if we didn’t point out that the Third Circuit recently reversed that opinion. See Race Tires America Inc v. Hoosier Racing Tire Corp., No. 11-2316, slip op. (3d Cir. March 16, 2012). All is not lost, however. While the Third Circuit held that such relief could not be obtained under the outdated language of the costs statute, it did recognize that there was another avenue that an aggrieved party could utilize:

A responding party, however, may invoke the district court’s discretion under Rule 26(c) to grant orders protecting him from undue burden or expense in [complying with discovery requests], including orders conditioning discovery on the requesting party’s payment of the costs of discovery. Here, neither [party] obtained a cost-shifting protective order. We are consequently limited to shifting only those costs explicitly enumerated in §1920.

Slip op. at 28-29 (footnote omitted). If the court seems sympathetic, this may be a useful avenue to try.
Second, we posted some time ago about Dobbs v. Wyeth Pharmaceuticals, 797 F. Supp.2d 1264 (W.D. Okla. 2011), in which a judge, post-Levine, held that a suicide claim involving a selective serotonin reuptake inhibitor (“SSRI”) was impliedly preempted under the Supreme Court’s “clear evidence” standard. As we discussed in some of our Colacicco posts, the SSRI/suicide cases present the best available fact pattern that we know of for preemption. The FDA reviewed the scientific data over and over again and held that it did not support a suicide warning, given that the condition SSRIs treat – depression – is itself a far more serious risk of suicide than anything else. To this day, the FDA has not found sufficient data for adults over 26 (the plaintiff in Dobbs was 53 years old when he killed himself) to justify any warning. Indeed, SSRI/suicide claims were what brought the FDA into the preemption arena to start with.
The Dobbs opinion did not dispose of every claim in the litigation, so it was not appealable. We’ve recently received word from defense counsel that another decision has been rendered in Dobbs, disposing of the remaining claims. Dobbs v. Wyeth Pharmaceuticals, No. CIV-04-1762-F, slip op. (W.D. Okla. March 16, 2012). That order, which dismisses fraud claims that the plaintiff did not assert very strongly, see slip op. at 2 n.1, is not particularly important by itself. It rejected those claims for failure to establish reliance, misrepresentation, or damages. Id. at 8-10. This dismissal, however, does make the earlier preemption ruling in Dobbs appealable – and that could be extremely important. Dobbs could tell us whether “clear evidence” really means just that, or rather is some sort of judicial code for “no preemption ever.” While we can’t rule it out, if an SSRI adult suicide claim is not impliedly preempted on a full record of the FDA’s review, it’s hard to think of any other warning claim that would be preempted.
We’ll be rooting for the defense in Dobbs through what is likely to be a long appellate process.
Third, friend of the blog Dan Cummins passed along to us another favorable ediscovery for defendants decision. Sourdiff v. Texas Roadhouse Holdings, LLC, 2011 WL 7560647 (Mag. N.D.N.Y. Oct. 24, 2011). It’s not particularly detailed, but Sourdiff continues the trend of broad discoverability of information that plaintiffs voluntarily post on social media sites. In Sourdiff, plaintiff’s counsel was directed to turn over:

any photographs, profile information, postings, messages, comments and status updates and/or other posts, including deleted content, that are in any way related to plaintiff’s emotional or mental state, her physical condition, activity level, employment, this litigation, and the injuries and damages claimed by plaintiffs in their complaint in this action.

Id. at *1. Significantly, the order also encompasses “any deleted postings” made to any “to internet social networking sites maintained by plaintiff . . ., including Facebook and MySpace.” Id.
Our posting about Sourdiff seemed to be a good time to update our research on the social media ediscovery issue. We found one other useful decision, Davenport v. State Farm Mutual Automobile Insurance Co., 2012 WL 555759 (M.D. Fla. Feb. 21, 2012), in which the court ordered production of every photo of the plaintiff posted on any social media site, whether or not she posted them (that is, including “tags” by other people).

Pennsylvania Product Liability Law – The Muddle Continues

By Bexis on March 23, 2012

The Pennsylvania Supreme Court yesterday decided Beard v. Johnson & Johnson, Inc., No. 35 WAP 2010, slip op. (Pa. March 22, 2012), a decision that is good, bad, and ugly at the same time. We say “ugly” because the entire decision – a discussion of strict “malfunction theory” liability in the context of a medical device, is based on a fundamental error (at least we’d say so) that was never brought to the court’s attention. That is, the Court in Hahn v. Richter, 543 Pa. 558, 673 A.2d 888 (1996), held that strict liability did not apply at all to any prescription drug, given the court’s reading of Restatement §402A, comment k. Subsequently, the Pennsylvania Superior Court (in accordance with the massive majority of cases nationwide) held that comment k would be applied in the same fashion to medical devices. See Creazzo v. Medtronic, Inc., 903 A.2d 24 (Pa. Super. 2006). Thus, Creazzo followed Hahn and held that strict liability simply does not apply to prescription medical devices.
But this foundational issue – whether a strict liability theory was even appropriate in a case involving a prescription medical product – was neither raised nor discussed, apparently at any level in Beard. Why? We don’t know.
Next, the good parts of Beard. The medical device in question, a really fancy stapler used for holding tissue together in complicated surgery where for one reason or another suturing is impossible or inappropriate, was designed for use in a variety of different surgical settings. The plaintiffs (who had not preserved the device in question) claimed that risk-utility balancing concerning the design of the device should be conducted with blinders on – that the analysis should be limited to the particular use to which the device was put in the plaintiff’s surgery. The Court refused to limit the scope of risk-utility balancing in that fashion:

For better or worse, this Court’s decisions have relegated our trial courts in the unenviable position of “social philosopher” and “risk-utility economic analyst.” This having been done — and as the present case does not provide an appropriate opportunity for reconsideration of such assignment – we decline to require the trial courts to put on blinders. It should be enough to say that a product’s utility obviously may be enhanced by multi-functionality, so that it would be imprudent to deny trial courts the ability to assign some weight to this factor in assessing product design. . . . [Plaintiff’s] concessions of the net social utility calculus in the area of the [device’s] primary design [a different kind of surgery] are irreconcilably inconsistent with his claim of an inherent design defect. . . .
[T]here is much at stake in the condemnation of a product’s design, above and beyond any individual damages award or awards, including the impact on product costs and design innovation. On balance, we differ with [plaintiff’s] position that the desire to streamline a particular facet of products litigation should be accorded priority over the wider-ranging assessment which was obviously intended from the outset, as manifested in the above characterizations of the trial court’s role, in the open-ended factors which have been accepted by Pennsylvania courts as the basis for risk-utility review, and otherwise.

Beard, slip op. at 24-24 (footnotes omitted).
After Beard, it is settled that, with respect to design defect claims in Pennsylvania, defendants will be able to defend by relying on the benefits of their designs in other uses of the product. This should apply both to the Pennsylvania-peculiar judicial balancing of risks and benefits required under existing law (see Beard, slip op. at 25), and to the presentation of a risk/utility defense to the jury at trial. See Phatak v. United Chair Co., 756 A.2d 690 (Pa. Super. 2000) (evidence bearing on same risk utility factors may be submitted to the jury in design defect cases).
This aspect of Beard can only help defendants by allowing them to compare their design to the plaintiff’s alternative design across the entire spectrum of a product’s intended uses. Since the plaintiff’s alternative design is usually tailor-made to address only the accident in a given case, the alternative’s adverse consequences to many other people who use the product will put before the jury the same broad perspective of product design that manufacturers necessarily employ in the real world.
The bad aspects of Beard are hinted at in the language we quoted above: “the present case does not provide an appropriate opportunity for reconsideration of such assignment.” Yet again, the defense community has missed an opportunity to have the wide-open existential question that hovers over all Pennsylvania product liability law – the negligence-based Restatement Third theory, versus Pennsylvania’s idiosyncratic form of strict liability expressed by Azzarello v. Black Brothers Co., 480 Pa. 547, 391 A.2d 1020 (1978) – decided.
Justice Saylor, who wrote Beard, is (as he stated in the opinion, slip op. at 23) one of “several justices” on record as supporting a shift away from Azzarello‘s extreme separation of “strict liability” from “negligence.” But as yet “a majority consensus has not yet been attained in any case.” Slip op. at 23. The three justices who first advocated the change, “Saylor, J., joined by Castille, J. and Eakin, J.,” id., aren’t getting any younger. Since Justice Saylor wrote Beard, he was careful to avoid anything that would undercut the Third Circuit’s prediction (which we discussed here) that the Court would eventually move to the Third Restatement. See slip op. at 23 (mentioning Third Circuit prediction in Covell v. Bell Sports, Inc., 651 F.3d 357 (3d Cir. 2011), and “[r]ecogniz[ing] the continuing state of disrepair in the arena of Pennsylvania strict-liability design defect law”). The Beard opinion also mentions the Third Restatement favorably in a footnote. Id. at 26 n.18.
A three-justice concurrence (Baer, McCafferty, Todd, JJ.) disassociates itself with footnote 18, also pointing out the unfortunate truth that, “[defendants] failed to raise this [Third Restatement] issue in their Pa .R.A.P. 1925(b) statement of errors complained of on appeal.” Id. at 2. These three justices steadfastly “express no opinion on the merits of the adoption of the Restatement Third.” Id. Significantly, however, none of these justices comments adversely on the Third Circuit’s continuing prediction in Covell of an eventual change.
However, another chance to get rid of Pennsylvania’s archaic and extremely pro-plaintiff strict liability has gone by the boards. While reading tea leaves is never easy, the fact that only three justices chose to disassociate themselves from Justice Saylor’s pro-Third Restatement comments in Beard suggests that there could well be a four-justice majority on the current court to jettison Azzarello in a case where this issue is preserved. Every defendant adversely affected by Azzarello should take care to preserve this issue from the outset. Express preservation at the trial court level is required. See Schmidt v. Boardman, 608 Pa. 327, 353, 11 A.3d 924, 940 (2011).

We’re Not Grossed Out

By Bexis on March 22, 2012

From the beginning of Gross v. Stryker Corp., 2012 WL 876719 (W.D. Pa. March 14, 2012), discussing PMA medical device preemption, to the end of the opinion, pointedly referring to the Rule 11 obligation to investigate cases before bringing them, we liked what we read. As you’ve probably already gathered, Gross is a Riegel-based preemption dismissal. Definitely worth a read by anyone defending PMA cases.

Gross is another Trident hip case – litigation that, but for Riegel, may well have grown up to be a mature mass tort. But after preemption, there isn’t very much there there any longer (assuming there ever was). Indeed, our medical device preemption scorecard is rife with decisions holding that all, or virtually all, claims involving this product are preempted. See Funk v. Stryker Corp., 631 F.3d 777 (5th Cir. 2011); Gelber v. Stryker Corp., 788 F. Supp.2d 145 (S.D.N.Y. 2011); Rhynes v. Stryker Corp., 2011 WL 5117168 (N.D. Cal. Oct. 27, 2011); Desabio v. Howmedica Osteonics Corp., ___ F. Supp.2d ___, 2011 WL 4074391 (W.D.N.Y. Sept. 13, 2011); Wilhite v. Howmedica Osteonics Corp., 2011 WL 2530984 (N.D. Ohio June 20, 2011); White v. Stryker Corp., ___ F. Supp.2d ___, 2011 WL 1131496 (W.D. Ky. Mar. 25, 2011); Gelber v. Stryker Corp., 752 F. Supp.2d 328 (S.D.N.Y. 2010); Lewkut v. Stryker Corp., 724 F. Supp.2d 648 (S.D. Tex. 2010); Lemelle v. Stryker Orthopaedics, 698 F. Supp.2d 668 (W.D. La. 2010); Cornwell v. Stryker Corp., 2010 WL 4641112 (D. Idaho Nov. 1, 2010); Van Dyke v. Howmedica Osteonics Corp., 2010 WL 8490858 (D. Mont. Apr. 23, 2010); Anthony v. Stryker Corp., 2010 WL 1387790 (N.D. Ohio Mar. 31, 2010); Yost v. Stryker Corp., 2010 WL 1141586 (M.D. Fla. Mar. 23, 2010); Horowitz v. Stryker Corp., 613 F. Supp.2d 271 (E.D.N.Y. 2009); Hayes v. Howmedica Osteonics Corp., 2009 WL 6841859 (D.N.J. Dec. 15, 2009); Covert v. Stryker Corp., 2009 WL 2424559 (M.D.N.C. Aug. 5, 2009) Delaney v. Stryker Orthopaedics, 2009 WL 564243 (D.N.J. Mar. 5, 2009); Parker v. Stryker Corp., 584 F. Supp.2d 1298 (D. Colo. 2008).

Thus, some parts of the Gross decision only repeat what has been decided before. We’ll simply note those parts of the opinion and move on: (1) a recall is not a revocation of approval for preemption purposes, 2012 WL 876719, at *2 n.13; (2) TwIqbal applies to actions removed from state court (see our prior post here), id. at *4 n.9; (3) Pennsylvania’s across-the-board application of Restatement §401A, comment k to bar strict liability applies to medical devices as well as drugs, id. at *7-9; (4) lots of different kinds of FDA documents are subject to judicial notice on a Rule 12 motion to dismiss, id. at *9 & n.26 (see our prior post here); (5) all components of a PMA-approved device are protected by Riegel preemption, including those with earlier §510k clearance, id. at *13-15; (6) just as Pennsylvania does not recognize strict liability, it does not recognize implied warranty in prescription medical product cases (see our prior post here), id. at *17 n.34; (7) to plead causation, a warning letter and/or a recall must cover the plaintiff’s particular device, id. at 23; (8) the ultra-liberal Hofts opinion is not a proper statement of TwIqbal pleading standards (see our prior post here), id. at *25; and (9) pleading an express warranty claim requires stating what the warranty is and how it became part of basis of the bargain. Id. at *27.

Gross also comes down on the side of those courts ruling that general GMP regulations are too vague to support parallel violation claims. 2012 WL 876719, at *20-22. The main reason given by prior courts for rejecting vague GMP claims is that they’re not “genuinely equivalent” because their vagueness allows plaintiffs to interpret them differently from the FDA and thus to impose obligations that the FDA itself does not impose. While Gross does not disagree, and indeed embraces this vagueness argument, id. at *21, the court also offers another rationale – that reliance upon generalized GMP regulations applicable to all devices is incompatible with the preemption rationale in Riegel, which bases preemption on “device specific” requirements imposed through PMA approval:

Under the premarket approval process, the FDA imposes federal “requirements” that are “specific to individual devices.” Allowing a plaintiff to plead nonspecific regulations as a basis for a parallel claim is inconsistent with the Supreme Court’s reasoning in Riegel, as well as the pleading requirements articulated in Twombly, Iqbal, and Fowler [a Third Circuit TwIqbal case]. This Court requires a greater level of specificity in pleading a parallel claim, rather than allowing claims premised on violations of general regulations to go forward merely because plaintiffs will supplement their pleadings at trial.

Gross, 2012 WL 876719, at *22 (all quotes to Riegel) (emphasis added). Riegel requires device-specific PMA requirements to establish preemption, and thus also requires a violation of device-specific PMA requirements to avoid preemption through the parallel violation loophole:

[P]ursuant to the premarket approval process, medical device manufacturers must adhere to device-specific requirements. As such, violations of same, and not merely any requirement, properly serve as the basis of a parallel claim. . . . In the instant case, the CGMPs cited by Plaintiff . . . are not only general; they apply to all Class III PMA medical devices. Furthermore, because these regulations do not address the manufacturing of the specific device at issue . . ., they cannot establish the requisite standard of care that a particular manufacturer must meet. The regulations delegate the maintenance of device-specific quality control to the manufacturer. Yet, Plaintiff does not plead that [defendant] violated its own policies regarding product safety. Plaintiff, instead, alleges that [defendant] violated very broad CGMPs that are not device-specific to the [device at issue]. As a result, Plaintiff does not plead sufficient facts to support a claim that [defendant] did not comply with these CGMPs.

Id. at *22-23 (citation and quotation marks omitted) (emphasis original). In short, since the device-specific PMA process is what created preemption in Riegel, only a device-specific violation claim can avoid preemption.

Because we haven’t seen a court articulate this rationale in this way before, we thought we’d point it out. Since Riegel hinges preemption on device specific requirements, which the GMPs are not, and because TwIqbal does not allow discovery based upon inadequate pleadings, Gross thus disagreed with the Fifth Circuit bootstrap approach in Bass v. Stryker Corp., ___ F.3d ___, 2012 WL 266985 (5th Cir. Jan. 31, 2012), insofar as the Fifth Circuit let plaintiff slide on pleading GMP violations because later discovery would provide the necessary specificity. 2012 WL 876719, at *22.

The court in Gross also engages in a more detailed analysis of res ipsa loquitur than we’re accustomed to seeing in preemption (or TwIqbal) opinions. Essentially, if the FDA’s GMPs are too vague to support a parallel claim – well res ipsa loquitur is even vaguer:

[T]his Court declines to infer the existence of such negligence in accordance with the doctrine of res ipsa loquitur under Pennsylvania law. Finding res ipsa loquitur here would require the Court to rely on even fewer facts than Plaintiff pled in support of his negligence claim.

Gross, 2012 WL 876719, at *24. In addition, nothing in the complaint ruled out the alternative cause of physician error, particularly since infection (the plaintiff’s claimed injury) was specifically warned of as both an adverse reaction and a contraindication. Id. at *24-25. So remember Gross for another proposition – TwIqbal requires a plaintiff pleading res ipsa loquitur to plead it plausibly by including some factual basis for excluding alternative causes.

A third particularly interesting aspect of Gross, from our standpoint at least, comes in its discussion of the FDA’s recall of some of these devices for “impermissible, excessive manufacturing residuals.” The plaintiff, however, admitted in the complaint that “he has not yet determined whether the residues on the hip prosthesis were” what the FDA had recalled. Gross, 2012 WL 876719, at *2. The court was none too pleased with this failure:

An attorney must conduct a reasonable inquiry before filing a lawsuit, and cannot pursue the action unless he or she reasonably believes that facts exist to support the allegations. Plaintiff underwent the [surgery in question] in October 2008. Almost two years later . . ., Plaintiff’s counsel [brought suit]. During this approximately two-year time period, Plaintiff’s attorney had a duty to investigate whether the residues on Plaintiff’s initial hip prosthesis were foreign bodies or native material from the manufacturing process.

Id. at *2 n.11 (citing, inter alia, Rule 11). Rule 11 “imposes on counsel a duty to look before leaping and may be seen as a litigation version of the familiar railroad crossing admonition to ‘stop, look, and listen’.” Id. at *5 (citation and quotation marks omitted).

For similar reasons, the court in Gross rejected plaintiff’s plea for discovery prior to dismissal. In TwIqbal, the Supreme Court had specifically stated that discovery was available only after the plaintiff pleaded a plausible claim. In order to plead a claim, a plaintiff may engage in self-help and nothing more:

To obtain additional information from the FDA to aid in drafting his Complaint, Plaintiff could have submitted a Freedom of Information Act (“FOIA”) request. . . . Plaintiff also had an opportunity to conduct pre-complaint discovery when he commenced this action in [state court]. . . . Finally, the Court finds Plaintiff’s request for discovery to be inapposite to Rule 8 and Rule 11(b) of the Federal Rules of Civil Procedure. Rule 8 . . . does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions. A plaintiff who fails to meet the pleading requirements of Rule 8 is not entitled to conduct discovery with the hope that it might permit her to state a claim. In addition, Rule 11(b) requires a pleading to be a representation of “the best of the person’s knowledge, information, and belief, formed after an inquiry reasonable under the circumstances.” An attorney must conduct a reasonable inquiry before filing a lawsuit, and cannot pursue the action unless he or she reasonably believes that facts exist to support the allegations. Allowing Plaintiff to “file first and investigate later” contradicts the reasonable inquiry requirement in Rule 11(b).

Id. at 29 (citations and quotation marks, except to Rule 11, omitted).

The court’s several references to Rule 11 echo our own feelings. It’s time for courts to crack down on knee-jerk filings in PMA preemption cases (and everywhere else, for that matter, but that’s a different gripe). Even the barest of investigations would have revealed the preemption issues involving this product. As our earlier list demonstrates, preemption has been on the front burner literally for years. In this situation, it’s not enough “reasonable inquiry” to plead “I dunno but I’ll find out later.” Preemption is a manifestation of congressional intent that certain types of actions should not be brought, and more courts, like Gross, should be willing to uphold that intent, rather than assist evasive plaintiffs.

Needless to say, Gross now enjoys a position of honor on both our device preemption scorecard and our TwIqbal cheat sheet.

Because it found that plaintiff had not come close to pleading an unpreempted claim, and indeed had not properly pleaded most of his preempted claims, the court in Gross dismissed all of the claims with prejudice and without leave to amend. That means there is an appealable order. We’ll keep watching Gross to see what the Third Circuit does with it.

Arbitration, Sales Reps and Personal Injury Claims

By John Sullivan on March 22, 2012

While it doesn’t involve a drug or device claim, James v. Conceptus, Inc., N. H-11-1183, 2012 U.S. Dist. LEXIS 32434 (S.D. Tex. Mar. 12, 2012), does involve a device company, sales rep, arbitration clause, and a determination that it isn’t unconscionable to send someone unwillingly to California. That was enough to pique our interest.

The plaintiff was a medical device sales rep. Id. at *1. He claimed that he was fired after he discovered certain information that he believed showed that a doctor and previous sales rep violated the False Claims Act. Id. at *5-6. He saw his firing as retaliation and filed a retaliation claim under False Claims Act §3730(h). But this case really isn’t so much about what the sales rep claimed. It’s more about where and how he could claim it.

The sales rep filed his case in Texas federal court. The company wanted arbitration in California. Id. at 1. Why? Because the sales rep’s employment agreement required that “any dispute” concerning his employment agreement be resolved by arbitration in “in San Mateo County of the State of California.”

So the company moved to dismiss the case in favor of arbitration. As you’d expect, the sales rep tried to get around the arbitration clause.

But that isn’t so easy these days. At least, not since the Supreme Court’ recent decision in AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740 (2011). This decision gave teeth to section 2 of the Federal Arbitration Act (“FAA”), which says that agreements to arbitrate are “valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for revocation of any contract.” The Concepcion court read the FAA to require courts to “place arbitration agreements on an equal footing with other contracts and enforce them according to their terms.” Id. at 1745. Moreover, the Court recently re-emphasized this the importance of this decision by upholding pre-dispute agreements to arbitrate personal injury or wrongful death claims against nursing homes. Marmet Health Care Ctr. v. Brown, 132 S. Ct. 1201 (2012).

Facing this strong mandate, it’s not surprising that the sales rep tried to get around the FAA by arguing that a different federal statute, the more-recent Dodd-Frank Act, rendered the arbitration clause unenforceable. Dodd-Frank amended the whistleblower provisions of the Commodity Exchange Act and the Sarbanes-Oxley Act to make unenforceable any pre-dispute clause that required arbitration of claims under their whistleblower provisions. 2012 U.S. Dist. LEXIS, at *15. The problem, though, is that the sales rep wasn’t suing under either of those Acts. His retaliation claim was under the False Claims Act, which Dodd-Frank didn’t amend. “When Congress amends one statutory provision but not another, it is presumed to have acted intentionally.” Id. at *15-16. The court properly rejected this argument.

The sales rep’s fall-back position was that two provisions of the arbitration clause – that he must pay half the costs of the arbitration, and that the arbitration occur in California – were unenforceable because they were unconscionable under California law, which applied under the employment agreement. He got, at best, a split decision.

In considering the applicability of California’s law of unconscionability, the James court applied its general understanding of Concepcion: “if the state law singles out arbitration agreements by imposing requirements that do not apply to other contracts, §2 of the FAA preempts applying that law to ‘disfavor’ arbitration.” Id. at *8. The court determined that the requirement that the sales rep pay half the cost of the arbitration was unconscionable because it would have required the sales rep to do something that he could not – pay half the arbitration bill. Id. at *33-34. The court felt that this application of California’s law on unconscionable agreements did not single out arbitration.

More important, though, the Court upheld the requirement that the sales rep, who lived in Texas, arbitrate his claim in California. Underlying the court’s decision was the fact that California law had two separate standards for forum selection clauses, one that applied generally (a fair and reasonable standard) and one that applied only to arbitration agreements (which are considered categorically unconscionable.) Id. at *35-39. Under Concepcion, this stricter standard that applied to arbitration agreements is preempted because it improperly singles out arbitration.

Applying the fair and reasonable standard instead, the Court upheld the forum selection clause. Id. at *42-43. While the sales rep argued that he didn’t have the assets to hire local counsel or pay travel costs, the court didn’t buy this argument. The court noted that the sales rep didn’t need local counsel in an arbitration and that his Texas counsel had shown himself capable of arguing California law. Id. at *43. Additionally, travel costs are insufficient to invalidate an arbitration clause – particularly where, as here, plaintiff would have to take only one trip to California . Id. at *43-44.

So the forum selection clause was enforced. And, like it or not, the sales rep was going to California.

The Plaintiff and The Known Risk

By Michelle Yeary on March 20, 2012

As we are sure you can tell from many of our posts – we are television junkies (well, most of us). We watch it all – comedies, dramas, news, sports, movies, documentaries, and yes, we’ll even admit to some knowledge of reality TV. And while we are sitting on the couch taking in all that our high definition television can throw at us, we are at fairly low risk of injury – carpal tunnel remote control syndrome? But, once we stand up and start moving around, all of that changes. There is a risk we’ll stub our toe on the coffee table as we head to the kitchen to refill the popcorn bowl. There is a risk of getting into a car accident driving to the movie theater (to again sit and become lost in another visual story). There is a risk of choking on our hamburger at dinner following the movie.

Sometimes, like the examples above, the risks are things we just inherently know exist. Other times, we need some additional warning. Like the sign on our ride to work that warns of fog ahead or caution tape around a broken sidewalk. How about a food label that says the product contains nuts – a warning to someone with a peanut allergy to avoid that food. Bottom line — we are surrounded by risks. And in our everyday lives, we make decisions about how risk averse we want to be. Will we walk around the broken sidewalk or jump over the caution tape? But, if we decide to walk through rather than around, maybe because going around requires us to step into the street, presenting its own risks, we have to accept the fact that we might trip and fall on the broken concrete.

The same is every bit as true in the context of prescription drugs. We don’t need to belabor the point that all prescription drugs contain risks. All prescription drugs have side effects, that’s why they require a doctor’s prescription in the first place. Where we rely on our own knowledge and experience in deciding whether the broken sidewalk or the street present the greater risk of injury, with prescription drugs we rely on our physicians. When the drug label warns of a risk and the doctors are aware of the risk but decide that it is in the patient’s best interest to administer the drug in light of the risk and then the patient develops the very risk warned about – it is unfortunate but it is not a basis for liability against the drug manufacturer.

So said the Connecticut Superior Court in Zelle v. Bayer Healthcare, LLC, 2012 Conn. Super. LEXIS 481 (Feb. 16, 2012). Plaintiff was admitted to the hospital with symptoms that caused doctors to believe she was having a stroke. The doctors ordered two MRIs, one with and one without contrast agent. The contrast agent contains a known and warned of risk of anaphylactoid allergic reaction. After administration of the agent, plaintiff did exhibit signs of an allergic reaction including respiratory arrest and hypotensive shock. Plaintiff was treated for this reaction and released from the hospital. Id. at *2-3. Plaintiff alleged both failure to warn and design defect under the Connecticut Product Liability Statute and both claims were dismissed on summary judgment.

First, failure to warn fell based on the learned intermediary doctrine. The evidence of warning in this case was abundant. It was documented in the label under the warnings, precautions and adverse reaction sections. Id. at *13 n.4. It was well-known by the doctors and nurses:

The deposition testimony of each of the physicians and the MRI technician leave no doubt that they were well aware of the possibility of adverse effects as noted in the FDA approved warnings and had for years been well aware of the specific risk of an anaphylactic reaction to the contrast agent. Each confirmed that they had considered the risks versus the necessity to diagnose and treat a possible stroke and determined that the MRI with the contrast agent should be ordered.

Id. at *15. In other words, the doctors decided to walk through the broken concrete (use contrast agent) because the risk of stepping into a busy street (the stroke) was greater. Indeed, precisely due to this potentially fatal risk with the contrast agent, the doctors at the facility kept a “crash cart” in the MRI room. Id. at *22.

The court also found that the “plaintiff [did] not present evidence or testimony that contradicts the adequacy of the warning, the nature of the warning, the approval by the FDA or the knowledge and understanding of the warnings by the treating physicians.” Id. at *15-16. In fact, apparently, plaintiff’s only “proof” was an unsigned consent form which the court found not only irrelevant, but detrimental to plaintiff’s argument:

the [learned intermediary] doctrine is applicable to the warnings being provided to the physicians and health care professionals and it is not relevant for purposes of this action whether the defendants provided specific warnings directly to the plaintiff. What the testimony and existence of the Consent Form does confirm is that the health care professionals had specific information concerning the adverse reactions as evidenced by the inclusion of these reactions within a form created by the hospital. Therefore, the plaintiff’s reliance upon the unsigned form to create a genuine issue of facts is misplaced.

Id. at *12-13.

The court then turned to the design defect claim. In dismissing the claim, the court made two good points. First, plaintiff needed an expert to establish both the alleged design defect and proximate causation:

In an action involving the complications of prescription medication . . . where the claims are either scientific or medical, an expert opinion is required to discuss the development, manufacture, testing, handling and marketing of the product alleged to be defective. Id. at *19-20.

. . . .

A finding of a defect in the drug is not within the common knowledge of an ordinary person. Without an expert as to the allegations that the product was in some manner defective causing serious unexpected and unforeseen physical injuries, the plaintiff has not been able to forge a sufficient link in the causal chain that would assist a jury in reaching an educated finding that the injuries were caused by a defect in the [drug] which was administered to her. Id. at *23.

That was enough to grant the defendants’ motion for summary judgment. But the court also had this to say about design defect in the context of a warned about risk:

[T]he plaintiff’s allegations about the adverse effect of the drug which is noted in the product labeling information approved by the FDA does not, by itself, rise to the level of a defective product. Many courts have recognized that prescription drugs can cause adverse effects but do not create liability in every instance where there is an adverse effect. This is especially relevant for an action in which the plaintiff alleges she has suffered the adverse effects noted in the product labeling. This recognition impacts the plaintiff’s obligation to prove not only that there are adverse impacts but that the plaintiff suffered because the drug was defective and the defect caused other adverse impacts or heightened in some manner the adverse impacts already recognized and addressed through precautions or warnings.

Id. at *21-22 (emphasis added). Suffering from a warned about risk isn’t enough. Even if the allergic reaction was connected to the injection of the contrast agent, that by itself does not create a defect. Id. at *22. As the court noted, “the product labeling . . . recognized the possibility of this exact reaction from a non-defective drug.” Id. at *24. Therefore, without expert testimony of a particular defect in the product, all plaintiff has proven is that she suffered from one of the potential, known, warned about side effects of the drug. She tripped on the broken concrete. Unfortunate, yes. A basis for liability, no.

One, Two … Three?

By Bexis on March 20, 2012

A couple of weeks ago we posted about the one-two punch of generic preemption and product identification disposing of most of the claims in the Darvocet MDL. Well, that combination has since landed a third punch that sent still more plaintiffs reeling.

It seems that the original branded manufacturer of the product was also embroiled in the litigation. That defendant had sold all its rights to the NDA in 2002 – long before the litigation began – to independent successor corporations. In In re Darvocet, Darvon & Propoxyphene Products Liability Litigation, 2012 WL 767595 (E.D. Ky. Feb. 5, 2012), the court dismissed those claims as well. The same rule – that the branded manufacturer owes no duty to generic-only plaintiffs – applies. Id. at *2, 8. Given the length of time that has passed, none of the plaintiffs could plausibly plead that they, in fact, took the original manufacturer’s product prior to 2002. Id. at *4.

There are a couple of factual twists that make this latest Darvocet decision particularly interesting, given the manner in which drug companies can divest themselves of NDAs. First, due to the learning curve in manufacturing drugs, it’s not unusual for the original NDA holder to continue producing the drug for a purchasing company for some time after the sale is effectuated. In Darvocet that period was two years and some months. 2012 WL 767595, at *6. Second, after selling off the NDA, it’s not unheard of for former branded manufacturers to keep their facilities operating by manufacturing drugs for sale by generic manufacturers. That also was alleged in Darvocet. Id. at *5-6.

Neither fact pattern helped plaintiffs, however. As for the first, the former brand name manufacturer did not make all of its successor’s product, but only a declining fraction of it. Id. at *7. No plaintiff could allege ingestion of of product from one source versus the other. Thus, the claim still failed product identification requirements – thanks to TwIqbal:

The plaintiffs have failed to state a plausible claim against [defendant] as a manufacturer of brand-name drugs after 2002. Accepting the allegations as true, at most they establish a mere possibility that the medicine used could have been made by [defendant]. . . . This is simply insufficient under Iqbal or Twombly because the allegations are too speculative to state a plausible claim. . . . The statement that “[The NDA purchaser] may have sold” products manufactured by [defendant] is too vague to establish that this plaintiff ingested a [defendant] drug on those specific dates.

2012 WL 767595, at *7 (emphasis added). Liability in this sort of indefinite manufacturer situation would require something along the lines of market share, but no market share theory applies where a manufacturer (here, the NDA purchaser) is in fact known. Thus, there cannot be a viable theory of liability – even in market share states.

Nor did plaintiffs get any further with allegations that the former branded manufacturer might have produced generically-marketed drugs. First, those claims suffered from the same fatal “maybe is not enough” product identification problems just discussed. Id. at *6 (“nothing more than a “sheer possibility” that [defendant] is liable”). Even more interesting, once a non-NDA manufacturer is involved, preemption comes into play. None of the plaintiffs alleged that the product made by the former brand name manufacturer had a manufacturing defect – only warning claims were made – and we all know that warning claims are preempted under Mensing when it’s impossible for the particular defendant to change warnings unilaterally:

The plaintiffs have not brought a manufacturing defect claim against [defendant] because their allegations do not assert that [it], at any time, manufactured products that were adulterated, outside of specifications, or used defective ingredients. Additionally, any state failure-to-warn claims would be preempted by federal law because, as the plaintiffs concede, [defendant] had no power to change the labels for generic drugs, or for brand-name drugs that were made and sold by others. Thus, it is not immediately apparent what purpose would be served by establishing that [defendant] manufactured propoxyphene products for other companies.

Id. (citations and quotation marks omitted) (emphasis added). Once a manufacturer surrenders its NDA, it loses the ability to make warning changes. Thus, Mensing impossibility preemption applies once the NDA is sold. Mensing thus cuts off claims of successor liability – whether or not the end product is generic or branded. That’s a point to remember.

These plaintiffs, as well, were thus down for the count. “[U]nder Iqbal, plaintiffs should not be permitted to conduct discovery in order to fix factually deficient complaints, even where the necessary information is within the defendant’s exclusive possession.” 2012 WL 767595, at *9 (denying leave to amend).

No Bracketology for Us: Chalk Up Wins for TwIqbal and Statute of Limitations

By Stephen McConnell on March 19, 2012

Some of our friends suggested that we honor the NCAA basketball tournament by engaging in a little bracketology. Presumably, they want us to run some legal concepts, cases, or personalities through brackets, ultimately selecting an overall champion. For those five or six of you who did not fill out March Madness sheets, bracketology is a way of deciding a winner by pairing off items, deciding winners, with winners advancing to confront other winners until there is one ultimate winner. Theoretically, bracketology can be as useful as, say, a decision-tree in evaluating alternatives or determining a course of action. Mostly, it’s a harmless diversion. Our favorite recent example was a bracketology treatment of characters from the late, lamented HBO series The Wire.
Bracketology can be fun. But it doesn’t really work for our purposes. Creation of an initial bracket requires a seeding of the contestants. That is, at the outset you first make an assessment of relative value or merit. The excitement of the NCAA tournament is how reality can play havoc with the seeding. (Ask anyone who picked Duke or Missouri to make it to this year’s Final Four.) Injuries, sudden and surprising ineligibilities, 19 year-olds calling timeouts when all timeouts have been used up, screwy turnovers, and miracle shots can all create improbable results. But an abstract exercise is different. It lacks the fluidities and frictions of real life. Doesn’t the initial assessment pretty much predetermine the outcome? How can there be any upsets? In fact, that is what happened with The Wire bracket. Everyone knew right away that Omar would likely win as best character. President Obama picked Omar. And, indeed, Omar won.
When people practice bracketology, the major issue is the extent to which one follows or departs from the “chalk.” The “chalk” means picking the favorites. It is a boring strategy, but is mostly effective. For every amazing underdog success story, such as Butler, George Mason, and VCU, there are way more Kentuckys, North Carolinas, and Michigan States. Odds are that this year’s Final Four will include at least three number 1’s or 2’s. Maybe one surprise team will sneak in. If one followed the chalk for The Wire bracket, one simply had to pick either Omar or Stringer Bell to triumph. (If you haven’t seen The Wire, shame on you. It certainly makes our Final Four of the best television dramas of all time.)
All of which is to say that we won’t be doing Drug and Device Law bracketology. We would simply end up going with the chalk. Plus, we’re not sure how to do the graphics for the brackets. If we were to pair off legal defenses, we’re fairly sure that TwIqbal, Daubert, Preemption, and Statute of Limitations would be our Final Four. A couple of posts ago we discussed how preemption is so strong because it can preclude cases that otherwise possess substantive merit. That is also true with the statute of limitations. We like TwIqbal because it gets rid of junk pleadings, and we like Daubert because it gets rid of junk science. It would be nice if courts followed the chalk and applied these doctrines to send the bad cases away, like Kentucky dispatching an inferior opponent.
Continue Reading No Bracketology for Us: Chalk Up Wins for TwIqbal and Statute of Limitations

Kurns – Anything In It For Us?

By Bexis on March 16, 2012

A couple of weeks ago – yeah, that’s right, on February 29 – the Supreme Court issued a ruling preempting asbestos product liability claims in Kurns v. Railroad Friction Products Corp., 2012 WL 631857, slip op. (U.S. Feb. 29, 2012). We’re only now getting around to posting about it because, frankly, there’s not a whole lot in it of interest to us.
The defendants won – the Court found the claims preempted – by 6-3, so that’s good. But the result was in large part driven by the plaintiffs’ tactical choice (in retrospect unfortunate for them, although maybe the issue was waived below) not to challenge the validity of Napier v. Atlantic Coast Line Railroad Co., 272 U.S. 605 (1926) . Napier had held that the Locomotive Inspection Act (the relevant statute) imposed field preemption, wiping out all state authority, including tort claims, over, among other things, locomotive parts. That’s because Congress provided that the statute applied to “the entire locomotive and tender and all parts and appurtenances thereof.” Kurns, 2012 WL 631857, at *4.
T’ain’t no field preemption in prescription medical product liability litigation. That more than anything else is why we didn’t blog about Kurns before now. So is there anything there we can use?
A little.
First, even though the supposed presumption against preemption first got its start in field preemption cases (see our post here, citing Rice v. Santa Fe Elevator Corp., 331 U.S. 230 (1947), Jones v. Rath Packing Co., 430 U.S. 519, 525 (1977), and Hillsborough County v. Automated Medical Laboratories, Inc., 471 U.S. 707, 715-18 (1985)), there’s not a peep about the elusive presumption in Kurns. That’s not really surprising, since Justice Thomas, who eviscerated the presumption against preemption in PLIVA, Inc. v. Mensing, 131 S. Ct. 2567 (2011), is also the author of Kurns. So we can say, “one more nail in the coffin….”
Another thing we like about Kurns is that it describes preemption in the absence of a statutory preemption clause as “occur[ing] through the direct operation of the Supremacy Clause.” Id. at *4 (citation and quotation marks omitted). That’s another beef we have with the presumption against preemption – there’s no principled basis for interpreting the constitution itself as narrowly as flaky decisions like Wyeth v. Levine, 555 U.S. 555 (2009), have done. Can you imagine a similar presumption against application of the Due Process clause? The Equal Protection clause? The First Amendment? We can’t either.
We also enjoyed the Court’s rare venture into substantive tort law. Kurns arose in Pennsylvania. 2012 WL 631857, at *3. That the Court chose (2012 WL 631857, at *7) to discuss Pennsylvania tort principles in terms of the Restatement (Third) of Torts Products Liability §2 (1997) resonates with us because whether Pennsylvania law follows the Second (§402A) or Third Restatement in product liability actions is a matter of considerable dispute – as we discussed in our post, here. Like the Third Circuit before it, the United States Supreme Court has come down on the side of the newer (and in most, but not all, situations better for defendants) Third Restatement.
The Court’s actual discussion of product liability law was rather arcane – are “warning defects” fundamentally different than “design defects”? Since a “warning” claim necessarily warns about risks arising from a product’s design, the Court held that the “gravamen” of the warning claim was the design of a locomotive part, which fit within Napier field preemption:

A failure-to-warn claim alleges that the product itself is unlawfully dangerous unless accompanied by sufficient warnings or instructions. Thus, the “gravamen” of petitioners’ failure-to-warn claims is still that [plaintiff] suffered harmful consequences as a result of his exposure to asbestos contained in locomotive parts and appurtenances. Because [plaintiffs’] failure-to-warn claims are therefore directed at the equipment of locomotives, they fall within the pre-empted field defined by Napier.

Kurns, 2012 WL 631857, at *7 (various quotations, including to the Third Restatement, omitted). Although the Court doesn’t phrase it as such, this is a reiteration of the fundamental principle underlying Restatement §402A, comment k – where a product has inherent risks (as do both asbestos and prescription medical products) warnings are necessary to make an unavoidably unsafe design “reasonable.”
Kurns also included a warning-specific variant of the propositions that tort claims regulate conduct and are therefore properly subject to preemption as state-law “requirements.” The Court stated:

This duty to warn and the accompanying threat of liability will inevitably influence a manufacturer’s choice whether to use that particular design. By influencing design decisions in that manner, failure-to-warn liability has a direct and substantial effect on the physical elements of a [product].

2012 WL 631857, at *7 n.4 (citation and quotation marks omitted). This proposition isn’t in serious dispute anymore, see id. at *8 (rejecting for the umpteenth time an argument that the common law is different) – unlike when we were starting out – but it’s nevertheless useful to have another Supreme Court case to cite, if needed.
Finally, the discussion, id. at *8, of a railroad’s right to buy (under Napier) federally compliant products being “meaningless” if the state could prevent defendants from selling them also tends to refute plaintiffs’ assertions of liability for “wrongfully marketing” FDA-approved drugs and devices. Take the Court’s statement in Kurns, “a railroad’s ability to equip its fleet of locomotives in compliance with federal standards is meaningless if manufacturers are not allowed to produce locomotives and locomotive parts that meet those standards,” and substitute drug/device facts. Then, one has:

[A] [hospital’s] ability to equip its[self with prescription medical products] in compliance with [FDA] standards is meaningless if manufacturers are not allowed to produce [drugs and medical devices] that meet those standards.

Id. at *8. So Kurns is another arrow in our quiver, there, as well.
Not terribly great, but definitely better than nothing.

Liability for Investigational Drugs That Work (Perhaps Too Well)

By Bexis on March 15, 2012

On a number of occasions – more during the first couple of years of the blog than recently – we opposed causes of action that would impose liability on drug/device manufacturers for investigational drugs that worked, and indeed worked well. By that we mean claims by research subjects demanding one form or another of continued access to an investigational drug after the study the plaintiff was participating in had concluded. Thus, we were mortified by the prospect of some sort of “constitutional right of access” to investigational drugs at issue in the Abigail Alliance litigation, and relieved when the purported right was held not to exist. See Abigail Alliance for Better Access to Developmental Drugs v. von Eschenbach, 495 F.3d 695 (D.C. Cir. 2007) (en banc); CareToLive v. von Eshenbach, 525 F. Supp.2d 952 (S.D. Ohio 2007). If such a right had been recognized, our clients would have inevitably been the next targets, since our clients make the drugs.

A little later, we offered our two cents worth when a district judge in the Gunvalson litigation entered an injunction ordering a drug company to continue supplying an investigational drug that was being discontinued. Fortunately (from our point of view – particularly since the defendant hired Dechert for the appeal), the Third Circuit ultimately reversed. See Gunvalson v. PTC Therapeutics Inc., 303 Fed. Appx. 128 (3d Cir. 2008).

Make no mistake about it, these are awfully sympathetic cases. In every one of them the plaintiff has some incurable condition that is at worst fatal and at best debilitating. There is no FDA-approved treatment that works worth a damn, and the investigational drug is – or is alleged to be – working miracles. However, the degree of sympathy such plaintiffs warrant is why these causes of action are so potentially dangerous, for they target the very process of innovation itself..

Recently, we discovered another instance of a study subject suing to demand continuation of investigational therapy after the end of a clinical trial. This case was actually decided earlier, in 2005, but never appeared in any of the online services. We found it serendipitously, and once we did, sent it to Westlaw. The case is Vinion v. Amgen Inc., 2005 WL 6763338 (D. Mont. Nov. 9, 2005). The plaintiff in Vinion used an investigational biologic and concluded that it “was was effective in improving [his] symptoms.” Id. at *1. The company allegedly told the plaintiff’s doctor that it “would continue to provide the drug to that person on a ‘compassionate use basis’ after the study was concluded.” Id. at *2. Or so the doctor said. The Vinion court assumed that statement to be true for purposes of summary judgment.

The only fly in the ointment? Cost. The product was supplied free of charge during the course of the study (as FDA regulations require), but once the study was completed, plaintiff ran afoul of his insurer’s death panel. See Id. at *2 (“his insurance would not pay for it and he could not afford it on his own”).

So plaintiff in Vinion sued – the drugmaker, not his insurer – claiming an oral contract “that [he] would be provided the drugs free of charge forever.” Id. at *1.

This is the kind of trouble that sponsors of clinical trials get into when they try to go beyond what the FDA requires. A purported oral contract to supply investigational drugs was also alleged in Gunvalson. So don’t expect clinical trial sponsors to be eager to go above and beyond their legal obligations. Our litigation-happy society discourages it. No good deed goes unpunished.

Anyway, enough editorializing. What happened in Vinion? The defendant received summary judgment because, while a promise to continue supplying the product existed – there had never been any promise made to supply the drug for free:

The undisputed facts . . . reveal that Defendants never promised to provide Plaintiffs with free [product]. There were three participants at the meeting where Plaintiffs allege a promise was made – Dr. [X, the plaintiff’s doctor], Dr. [Y], and [Mr. Z]. Although Dr. [X] testified that Dr. [Y] promised to continue providing [the product] post-study, none of the three testified that they discussed [defendant] providing [it] free of charge after the study was complete. . . . Dr. [X] testified that “the word free never came into the discussion at all. . . . [The others] denied making a promise to provide [product] free of charge after the drug study. . . . Dr. [X] also testified that . . . he assumed that any provision of [the product] after the study would be at no cost to Plaintiffs because Plaintiffs were unable to pay for the drug. However, Dr. [X’s] assumption is not evidence of an enforceable promise.

Vinion, 2005 WL 6763338, at *5-6.

To try to get around this testimony – indicating that plaintiff’s treater had simply been mistaken as to the terms of the defendant’s offer, plaintiff attempted to have his treater declared an “agent,” or failing that, an “ostensible agent” of the defendants because the treater was an investigator in the defendant’s study. Fortunately (for the defendants), they had covered this point in their study documentation, specifying that the “relationship . . . is that of an independent contractor.” Id. at *6. Let that be a lesson – proper documentation can insulate study sponsors from liability for the mistakes of the investigators they recruit. Other documentation (the study’s informed consent form) sank the plaintiff’s ostensible agency claim:

[T]he documentary evidence demonstrates that Plaintiffs had actual notice that Dr. [X] was only authorized to convey answers to medical questions, not questions regarding Plaintiffs’ rights as study subjects. Whether Plaintiffs were entitled to receive the drug after the study was completed is a question regarding their rights as study subjects. Plaintiffs could not look to Dr. [X] for that information, but rather had been told to contact Defendants [or the institutional review board].

Vinion, 2005 WL 6763338, at *6. Documentation is important in clinical trials – in Vinion it prevented liability on an investigator’s unilateral mistake.

It turns out (we didn’t know until later) that Vinion was affirmed. See Vinion v. Amgen Inc., 272 Fed. Appx. 582 (9th Cir. 2008). In the eyes of the Court of Appeals, proper documentation again was the key:

The only contact between [defendants] and [plaintiff] was the consent agreement they signed at the beginning of the study. The agreement says that the study is “under the direction” of [plaintiff’s] physician and says nothing to support a reasonable belief that [the treater] would be acting under the direction of the [defendants]. [Defendant’s] agreement with the physician specified that he was an “independent contractor,” and [defendants] did nothing that would give him the appearance of being their agent.

Id. at 583-84.

We thought we’d look for other cases where plaintiffs sought to force clinical trial sponsors to continue supplying investigational drugs after termination of such studies. We knew of another case from our Abigail Alliance research. See Abney v. Amgen, Inc., 443 F.3d 540, 548-51 (6th Cir. 2006) (rejecting any duty to continue supplying drug after study ended). So we shepardized all the relevant cases we knew about and also searched for the term “compassionate use.”

We first found Cacchillo v. Insmed, Inc., 638 F.3d 401 (2d Cir. 2011), in which a participant in a clinical trial sued the defendant sponsor of a clinical trial for allegedly refusing to support the plaintiff’s “compassionate use” application to the FDA for continued access to the study drug after the study was concluded. In addition to common-law claims, this plaintiff creatively asserted a civil rights claim under 42 U.S.C. §1983. As in other cases, the plaintiff sought a preliminary injunction ordering the defendant to provide the discontinued drug for an indefinite period. The Second Circuit rejected such relief, pointing out that the drug in question “is no longer produced, only limited stores of [it] remain and . . . all remaining [drug] has been committed to patients with amyotrophic lateral sclerosis.” 638 F.3d at 403. The court refused to let a disappointed research subject use litigation to jump the queue:

[Plaintiff] has not met her burden to show that she has a likelihood of success on the merits. [Her] claims hinge on [defendant’s] alleged promise to support [her] compassionate use application. Yet, [she] has no evidence that such an agreement existed beyond her own vague recollection. . . . [Her] description of the alleged agreement is problematic for at least three reasons. First, [her] recollection of the contents of [defendant’s] website is belied by [defendant’s] exhibits showing that its website contained no such statements. Second, [she] offers no theory of agency by which the clinical research coordinator’s alleged statement would be binding upon [defendant]. Third, [her] vague descriptions of the alleged agreement, without more, strongly suggest that [she] is not likely to establish that [defendant] agreed to support her compassionate use application even if, as happened in the present case, [defendant] concluded that the drug at stake is ineffective and better allocated to other patients.

Id. at 406.

However, despite the Second Circuit’s dim view of the plaintiff’s evidence, that District Court in the same case subsequently allowed some of the plaintiff’s claims to survive a motion to dismiss. In Cacchillo v. Insmed Inc., ___ F. Supp.2d ___, 2011 WL 2600611 (N.D.N.Y. June 29, 2011), the plaintiff’s civil rights claims were dismissed, for lack of state action, along with claims for intentional infliction of emotional distress, assumed (Good Samaritan) duty, fiduciary duty, negligence, and unjust enrichment. Id. at *11, 15-18. However, given the statements allegedly made on the defendant’s website (see if it will do that again), the district court held that claims for breach of implied contract, negligent misrepresentation, and fraud (!) survived dismissal for failure to state a claim. Id. at *11-14. As we said, these plaintiffs can be very sympathetic.

As support for dismissing the fiduciary duty claim, Cacchillo (district court) cited another interesting case, also involving a lawsuit demanding continuing post-study access to an investigational drug, Suthers v. Amgen Inc., 372 F. Supp.2d 416 (S.D.N.Y. 2005). Suthers looks a lot like Gunvalson. The plaintiffs were research subjects, and they sought an injunction to force the drug manufacturer (and study sponsor) to continue supplying a product they found effective after the study was concluded – because the data did not support overall safety or effectiveness. Nope, the court held. Once again the documentation – the patient consent form and the agreement between the study sponsor and its investigators – precluded the finding of any duty to supply investigational study medication indefinitely to particular study subjects, regardless of the outcome of the study as a whole. 372 F. Supp.2d at 424-25. Nor, given the documentation, could they make their treating physician into an agent or apparent agent of the defendant. Id. at 425.

Suthers also rejected liability on the basis of “promissory estoppel” – because there was no “unambiguous promise” to supply medication forever. Nor was there a fiduciary duty owed between an FDA-regulated sponsor of a clinical trial and a study subject:

Here, a therapeutic treatment was tested in a manner so that the tests would comply with FDA regulations. To avoid the potential that a pharmaceutical company with a financial interest in the outcome would place participants at risk of needless harm, independent research institutions and their physicians conducted the clinical trials. . . . The FDA tightly regulates how research trials are to be conducted. . . . One provision of [an FDA regulation] anticipates that a study sponsor may seek the right to terminate a subject’s participation without his consent.

The fiduciary duty envisioned by the plaintiffs would presumably mean that if it were in a study participant’s best interests to continue a clinical study, then the sponsoring company would be without power to terminate it without risking a finding of breach. Such a standard provides no guidance on a host of issues, including how long the sponsor’s fiduciary duty would extend, whether the research institution would also have a duty to continue treating the study participant indefinitely, and whether the fiduciary obligations of the study’s sponsor would survive the decision of the patient to cease his or her relationship with the research institution.

Here, the trial was consciously structured to foster the independence and objectivity of the research institutions and principal investigators conducting the study. The independence ensures that the sponsoring company does not manipulate the study to the ultimate detriment of those who may someday use the treatment. . . . [T]here is no basis in fact or law to impose a fiduciary duty running from the sponsor of an independent study to participants who it does not select, has not met, and about whom it may not know the details of their medical conditions. The constraints upon the conduct of the sponsoring company include FDA regulations and the contractual commitments that it undertakes, as well as ethical constraints imposed internally and through the pressures of the marketplace.

372 F. Supp.2d at 427-29. Now there’s a ruling that future study sponsors faced with similar claims can use.

In a subsequent opinion the court dismissed the remaining claims in Suthers, ruling: (1) there was no contractual promise to provide the investigational drug “indefinitely” after the study was completed; (2) no implied covenant of “good faith” was violated; (3) no “clear and unambiguous” promise supported a claim for promissory estoppel; (4) again, that there was no fiduciary duty; (5) there was no Good Samaritan negligence liability; and (6) that clinical trials did not involve “sales” that could support a consumer protection claim. Suthers v. Amgen Inc., 441 F. Supp.2d 478 (S.D.N.Y. 2006).

Other than a smattering of law review articles, CLE materials, and briefs, that appears to be all the caselaw involving claims that plaintiffs have some right to allegedly beneficial investigational products, even after the relevant clinical trial has ended. So far, at least, no plaintiff has been successful in using litigation to force a sponsor of a clinical trial to continue providing its investigational product to the plaintiff after the trial was completed.

Drug & Device Law