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

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

The Plaintiffs’ Motion for Voluntary Dismissal without Prejudice

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

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

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

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

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

The Defendants’ Motion for Summary Judgment

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

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

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

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

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

We are sure you all heard about the $417 million verdict returned recently against a talcum powder manufacturer in Los Angeles, and we are equally sure you heard about the trial court’s order setting the verdict aside a couple of weeks ago and entering judgment in favor of the defendants. See In re Johnson & Johnson Talcum Powder Cases, No. BC628228, 2017 WL 4780572 (Cal. Superior Ct. Oct. 20, 2017).  We will repeat that result because it’s really important:  The trial court did not just grant a new trial.  It found that there was no substantial evidence to support the verdict and entered judgment for the defendants.  Not another trial; a complete win on a post-trial motion, which is relatively rare under California procedure.

It is an important order for many reasons. In today’s world of mass litigation, we often see cases involving the same products and similar allegations result in verdicts that vary—and sometimes they vary substantially.  In cases alleging that talc products cause ovarian cancer, the results have been striking—ranging from a defense verdict in one case to the aforementioned nine-figure wreck in another.

What gives? Well, the trial court’s order vacating the verdict paints a pretty clear picture of what happened in Los Angeles:  The jury, goaded by improper argument from the plaintiff’s counsel, ignored its instructions and spun out of control.  We will explain the court’s order in some detail below, but consider these nuggets:

  • The jury assessed 97 percent responsibility and $408 million in damages against a holding company for negligent failure to warn even though the company never made or sold one of the two products at issue and had not made the other since 1967, if ever.
  • The jury awarded “compensatory” damages of $68 million against the holding company and $2 million against the product manufacturer—figures that are exactly proportional to each company’s net worth. Hmm.
  • It was undisputed that no study has ever shown that talc can cause ovarian cancer, and some studies on which the plaintiff’s expert relied showed a relative risk in the range of 1.3, which tends to disprove causation. Yet, the jury found the products caused the disease.
  • The plaintiff had one expert on specific causation—the plaintiff’s treating physician, who conducted a hopelessly inconsistent “differential etiology” designed to reach her desired conclusion.

There is much more to the order, but suffice it to say that this trial court exercised its duty to right a wrong. The plaintiff alleged that she used one of two talcum powder products daily from about 1965 to 2016 and that she developed high grade serous ovarian cancer as a result. Id. at *1.  She sued the manufacturer of the products and its holding company, which itself may have made one of the products before changes to the business in 1967 (the evidence is not definitive on this point, but you get the gist). Id. at **1, 5.  According to the court, there is an ongoing debate in the scientific community as to whether talc usage can cause ovarian cancer or whether the science supports only an association, which is a profound difference. Id. To resolve this issue, the parties presented the jury with evidence focusing largely on epidemiological studies, and when all was said and done, the case went to the jury on the theory that the defendants negligently failed to warn regarding a known or knowable risk. Id.

After the jury returned its verdict, both defendants moved for judgment notwithstanding the verdict and a new trial. We’re not going to cover everything, and because the middle of the order (addressing the reliability and sufficiency of the plaintiff’s specific causation case) is the most important part, we will start there.

The manufacturer’s motion for judgment notwithstanding the verdict.  It’s all about the experts, and that is where the plaintiff failed to prove her case.  Her only expert on specific causation was her treating physician, who conducted a “differential etiology” analysis and opined that it was more probable than not that the products caused the plaintiff’s high grade serous ovarian cancer. Id. at *3.  The opinion, however, unraveled from there.  We have at times criticized the “different diagnosis” or “differential etiology” as a method for determining causation.  The approach was developed as a diagnostic method, not a method for attributing cause.  And because it is a process of elimination, it can result in a causation opinion by default—the expert says she “ruled out” everything else, so it must have been the product.

Despite our reservations, we understand that courts have accepted causation opinions based differential diagnoses. The method, however, must be applied in a reliable way, and that is where the trial court here got it right, including by citing one of our favorite cases, Glastetter v. Novartis:

In performing a differential diagnosis, a physician begins by “ruling in” all scientifically plausible causes of the plaintiff’s injury. The physician then “rules out” the least plausible causes of injury until the most likely cause remains.

In re J&J Talcum Powder, at *13 (citing Glastetter v. Novartis Pharms. Corp., 252 F.3d 986 (8th Cir. 2001) and Cooper v. Takeda Pharm. Am. Inc., 239 Cal. App. 4th 555 (2015)).  The “rule in” part is the most important because unless the expert has a reasonable scientific basis for “ruling in” the potential cause, it does not matter what else is “ruled out.”  The potential cause is not on the differential to begin with.

The plaintiff’s specific causation expert did not properly “rule in” talc products as a cause of the plaintiff’s ovarian cancer. Her only basis was epidemiology and a general reference to inflammation, which the plaintiff did not have. Id. at *14.  But none of the four studies on which the expert was permitted to rely showed odds ratios in excess of 2.0 that a woman using talc would develop serous ovarian cancer.  (A relative risk exceeding 2.0 would indicate that a women has more than a 50 percent greater chance of developing cancer than women who did not use talc, i.e., more likely than not.)  Two of the studies did not break out serous ovarian cancer, and the two that did placed the relative risk at 1.7. Id. Other studies on which the expert relied showed relative risk ratios “in the range of 1.3,” which tends to disprove causation. Id. The most recent study showed a relative risk of 1.0—i.e., women like the plaintiff had no greater risk and no lower risk of developing serous ovarian cancer than women of the same age in the general population. Id.

This is a long way of saying that the expert could not cite scientific evidence that talc caused the plaintiff’s disease. The plaintiff protested that epidemiology is not required to prove causation, but epidemiology is what the expert cited to “rule in” talc.  As the court said, “Although Yessaian testified that epidemiology was just one of the factors she looked at, she did not mention any others.” Id. The expert also did not “rule out” other causes, such as age and ovulatory cycles.  But the ruling that she could not “rule in” talc is the key take away from this order, along with the trial court’s very disciplined approach to the evidence and the law.

The holding company’s motion for judgment notwithstanding the verdict.  Although we are addressing this motion second, don’t underestimate how important it was that the trial court entered judgment for the holding company.  The lion’s share of the verdict was attributed to the holding company—no doubt because of its predictably robust net worth.  Call us jaded, but we are guessing the holding company’s net worth is the only reason the plaintiff sued that company to begin with.

The order granting judgment notwithstanding the verdict is the correct result. The holding company never made or sold one of the products at issue and it may have sold the other only until 1967.  There was no evidence that the company knew or should have known that talc probably would cause cancer during any time that it may have sold the product, and thus it had no duty to warn. Id. at **5-6.  Remember, failure to warn is the only theory upon which this case was tried.  The plaintiff tried to hold the holding company responsible for its subsidiary’s products through a hodgepodge of company documents, but they did not come close to showing that the companies shared an alter ego or agency relationship.  The court therefore granted JNOV for the holding company on the duty to warn, and also on punitive damages.  There simply was no clear and convincing evidence that a managing agent acted with malice either. Id. at *11.

Both defendants’ motion for new trial.  The court also granted the defendants’ motion for new trial.  You might wonder why the court granted a motion for new trial when it had already granted the motions for judgment notwithstanding the verdict and entered judgment in the defendants’ favor.  The reason is the inevitable appeal.  If the California Court of Appeal reverses the order granting JNOV for either defendant, it can still affirm the order granting a new trial and remand the parties to try the case again, rather than reinstate the original verdict.

Let’s hope it does not come to that, but regardless, the court accepted many (but not all) the proffered arguments for granting a new trial. First, because the plaintiff’s specific causation opinion was unreliable, the defendants’ motions to exclude or strike that opinion should have been granted. Id. at *20. Second, the court should not have allowed introduction of a newspaper article on condoms, which said that concern about talc and ovarian cancer “goes back 50 years” in the medical literature and that condom manufacturers removed talc from condoms in the 1990s for that reason.  It was rank hearsay, and although it came in through an expert, it should not have.  Compounding the error, the plaintiff’s counsel ignored the court’s limiting instruction and referred to the article several times in closing. Id. at **21-22.

Third, counsel ignored another limiting instruction by arguing to the jury that the defendants “prevented regulation” and prevented the government from listing talc as a carcinogen—so-called “lobbying.”  The “lobbying” evidence did not go so far, hence the limiting instruction, which counsel violated. Id. at **22-23. Fourth, two jurors executed declarations stating that the jury considered taxes and attorneys’ fees in reaching its verdict, which was contrary to instructions and improper. Id. at **23-24. Fifth, although the $2 million compensatory verdict against the product manufacturer was not so excessive as to require a new trial, the $68 million verdict against the holding company plainly was. Finally, because there was insufficient evidence to support punitive damages against either defendant, the punitive damages award was plainly excessive, too.

That is all you really need to know, maybe more. The trial court here gave every inference to the plaintiff, yet still found the evidence lacking, and now comes the appeal.  The parties will not get a result in 2017, so we will set our gaze to 2018 and wait and see.  Whatever the result, we have a feeling that this case will appear on one of our top ten lists for 2018.

Can you recall what you were doing back in March of this year? To be more precise the day before St. Patty’s Day and the day after the Ides. No? Well, apparently the defendants in the Risperdal and Invega Products Liability Cases pending in California state court were celebrating but they forgot to invite us to the party. We just learned about the very nice preemption decision entered by the trial court in that litigation. Since it’s never too late to celebrate a preemption victory, here are the highlights.

Before we get into the case specifics, the court’s general preemption analysis merits a minute of our time. ‘[I]f the tort plaintiff’s failure to warn theory was already tested by FDA action or inaction or would have required the use of a label on a prescription drug which the FDA would have prohibited,” the claim is preempted. Risperdal and Invega Product Liability Cases, 2017 WL 4100102 at *5 (Cal. Super. Mar. 16, 2017). What remains for private plaintiffs to challenge in a tort setting, therefore, is the adequacy of the label or the reasonableness of the manufacturer in updating the label based on new or additional information not already considered by the FDA. Id.

 In discussing whether information was presented to the FDA for consideration, of course, fraud-on-the-FDA and Buckman enter the discussion. The court nicely summarized the public policy reasons supporting Buckman preemption:

The understandable concern is that allowing a private right of action for “fraud on the FDA” would embroil the agency’s staff, particularly its scientific staff, in court litigation to the derogation of their performance of their primary duties. This would result both from the consumption of time in litigation activity and from a concern that their routine duties, decision-making processes and public communications would all have to be vetted with litigation avoidance in mind.

Id. at *6.

Next the court establishes that the Wyeth v. Levine “clear evidence” standard does not require indisputable evidence, but rather defendants must establish impossibility preemption by “clear and convincing evidence.” Id. And finally, the court found that preemption is a question of law, not fact and therefore an issue for the court, not the jury. To the extent deciding preemption requires the court to rule on a factual dispute regarding what the FDA would do, “the dispute is one regarding a legislative fact, not an adjudicative fact. Thus it presents a legal question for judicial resolution.” Id. at *7.

With that as background, we turn to the specific facts of the case. Risperdal is an anti-psychotic medication. Id. at *1. The Risperdal label that plaintiffs claim is inadequate was modified in 2006 to include language about prolactin elevation and the reported rate of gynecomastia (enlargement of male breasts) among Risperdal users. Id. at *3. Plaintiffs allege that defendants failed to adequately warn of this risk because the labeling did not include the “true” rate of gynecomastia and should have included an instruction to physicians to monitor blood prolactin levels. Id. at *1. Defendants moved for summary judgment on preemption grounds in 5 cases involving plaintiffs from 4 different states. Id.

With respect to the rate of gynecomastia set forth in the label, the FDA specifically approved the pooling of data from 18 studies to arrive at the rate that was used in the labeling. Id. The FDA re-examined the label in 2007-2008 and concluded that it required no labeling changes regarding gynecomastia or prolactin elevations. Id. Plaintiffs argue that the pooled average was lower and that defendants should have disclosed the higher incident rates observed in 2 of the 18 studies. Id. at *8. Because those 2 studies were among those considered by the FDA during the approval process, “the FDA’s position is clear [as to] how information regarding the 18 studies should be described in the label.” Id. This portion of plaintiffs’ claim is therefore preempted.

As to plaintiffs’ allegation that defendants failed to adequately warn about monitoring prolactin levels, plaintiffs rely on “Table 21.” This is a table containing an analysis of 5 studies purportedly showing a statistically significant association between elevated prolactin levels and gynecomastia. Id. The table was in a draft of a journal article but not in the final publication and therefore not submitted to the FDA during the approval process. The studies reviewed in the table, however, were among those considered by the FDA. Id.

 Plaintiffs argued that based on the information in the table, defendants should have independently changed their label under the Changes Being Effected (“CBE”) regulations. However, to implement a CBE label change without prior FDA approval, the change must be based on “newly acquired information” which is defined as

data, analyses, or other information not previously submitted to the agency, which may include (but are not limited to) data derived from new clinical studies, reports of adverse events, or new analyses of previously submitted data (e.g., meta-analyses) if the studies, events or analyses reveal risks of a different type or greater severity or frequency than previously included in submissions to FDA.

Id. at *9. Table 21 doesn’t fit that definition. It may be a different analysis of the data, but it did not show a different type or greater severity or frequency of the risk of gynecomastia which is the focus of the CBE regulation. To the extent plaintiffs also tried to rely on their litigation experts’ analysis of the data, the court point out that that was a tactic tried and rejected in several other litigations as a means of avoiding preemption. Id. So, plaintiffs’ claims are also preempted because the data they rely on to suggest defendants could have changed the label is not newly acquired and could not serve as the basis for an independent label change.

Not only could defendants not have changed the label on their own, the court found clear evidence that the FDA also wouldn’t have approved it.  In 2012, one plaintiffs’ counsel submitted a Citizen’s Petition to the FDA alleging that the Risperdal label did not adequately address elevated prolactin levels, the need to monitor for elevated prolactin levels, or the rates of gynecomastia. Id. at *4. Essentially the same allegations raised in the litigation. In its response denying the petition, the FDA stated that it was commonly known that Risperdal increases prolactin and that gynecomastia is one of the manifestations of increased prolactin. Id. at *5. Based on that the court concluded:

This Court is persuaded that these reasons articulated by the FDA in response to the very claims alleged here provide the kind of “clear evidence” of “legislative fact” which the U.S. Supreme Court requires before a court can hold that impossibility preemption applies. By any standard, there is “clear evidence” that Plaintiffs’ entire theory of label inadequacy focused on prolactin levels was not only considered and rejected by the FDA but also rests on information (and allegations) known to the FDA and the medical community. The FDA’s review of the 18 clinical studies—which form the underlying data of any theory that Plaintiffs posit—both pre-approval and in subsequent reviews, and its subsequent inaction, seem to be the definite upshot of a conscious FDA choice on information before the agency. It is not this Court’s job to revisit a decision made by the FDA.

Id. at *11.

It may not be the court’s job to revisit FDA decisions, but it is certainly this blog’s job to visit strong preemption decisions like this one. So, just a reminder that if you get a good decision – forward it along. Don’t make us wait 6 months to join the party.

The California Supreme Court heard oral argument in T.H. v. Novartis on Monday.  That is the case where the California Court of Appeal held that a prescription drug manufacturer could be held liable for injuries allegedly caused by a product that it did not make and did not sell.  This situation usually presents itself when plaintiffs sue an innovator drug manufacturer for injuries allegedly caused by generic products. T.H. v. Novartis has an added twist—the innovator manufacturer that the plaintiff sued had not made or sold the product for six years.  It sold the product line to another manufacturer, who made and sold the product that the plaintiff allegedly used.

How then can the innovator manufacturer owe a duty to this plaintiff, when it did not sell the product that allegedly harmed her and had not sold the product for anyone’s use for six years?  We set forth our views on this question here and here, where we listed the Court of Appeal’s opinion in T.H. v. Novartis the fifth worst decision of 2016.

The argument before the California Supreme Court lasted well more than the one hour allotted, and it featured questions from all seven justices. We’re not going to give you a blow-by-blow account.  Our stenographic skills are not up to that task, and it would take too long anyway.  We will start, however, the same way counsel for the defendant did:  The case presents not one, but two issues of duty.  For the plaintiff’s case to proceed, the California Supreme Court would have to recognize two unique legal duties:  (1) the duty of an innovator drug manufacturer to users of its competitors’ generic products, widely called “innovator liability”, and (2) the duty of a product’s former manufacturer to users of products made and sold by subsequent manufacturers, which we will call “perpetual liability.”

Perhaps the Court already knows what it wants to do with innovator liability, because nearly all the questioning was on perpetual liability, and the answers did not completely satisfy all the justices. To start, both sides attempted to seize the status quo—the defendant argued that no court anywhere has ever held a former manufacturer liable for a injuries allegedly caused by a subsequent manufacturer’s product, and the plaintiff argued that everyone owes a duty to everyone else to refrain from negligence.

The argument, however, dwelled on the limits of duty and how/where the Court should draw the line. Only one thing was clear:  The Court was troubled by the prospect of liability in perpetuity for a manufacturer that no longer sells a product.  The plaintiff tried to minimize the issue, arguing more than once that the prospect of perpetual liability was overblown and that perpetual liability cases would be rare.  Counsel even suggested once that the Court’s questions were “stacking a rare hypothetical upon a rare hypothetical.”  Despite these efforts, the Court directly confronted the issue, with a couple of justices noting that the situation would not necessarily be rare.

Now, whether the Court will recognize a new duty for former manufacturers and, if so, how the Court will limit such a duty is anyone’s guess. Of course, the best and obvious solution is to adopt the bright-line rule urged by the defense, that a former manufacturer owes no duty at all to users of a subsequent manufacturer’s products.  This is what every court to consider perpetual liability has decided, and it follows California Supreme Court precedent holding that a manufacturer owes no duty to warn regarding hazards in another manufacturer’s product, most recently in O’Neil v. Crane Co., 53 Cal. 4th 335, 360 (2012) (“An interpretation of [the law] that would require a manufacturer to warn about all potentially hazardous conditions surrounding the use of a product, even when those hazards arise entirely from the product of another manufacturer, reaches too far.”).  It is likewise faithful to decades of product liability law in California and elsewhere, which places the duty to warn on a product’s manufacturers and sellers.

The Court questioned counsel on other potential limits, for example by asking repeatedly how long a former manufacturer’s duty should persist. One justice noted that the lapse of time was the most difficult question.  In this case, six years passed between the defendant’s sale of the product line and the plaintiff’s use of the product manufactured by another company, so how long is too long?  Plaintiff had no answer to these concerns, and counsel finally acknowledged after nearly an hour of argument that there was no way to “scrub” perpetual liability from the case.

The Court also asked whether concepts of breach of duty and causation would adequately protect the defendant. In other words, if the Court created the duties, could the defendant move for summary judgment or defend itself at trial on the basis that it neither breached a duty nor caused any injury?  At least one justice was relatively open in supporting this idea.  Others preferred to focus on the threshold question presented—whether the defendant owed a duty in the first place.  In this regard, the expense of litigation and the ability (or inability) of a defendant to spread the cost when it no longer sells the product are particularly relevant considerations.

There were other suggested limits. The plaintiff argued that a former manufacturer could protect itself by updating its label before transferring a product line.  But as the defendant pointed out in response, that solution offers false assurance because plaintiffs would just claim the updated label was inadequate, too.  One plaintiff’s attorney suggested that the Court set a time limit for suing the former defendant, but another retracted that suggestion, noting that statutes of repose were the business of the legislature.

The plaintiff also suggested that a former manufacturer could protect itself by bargaining for indemnity, which led to questions about the whether the identity and reputability of the purchaser of the product line would make a difference. At least one justice thought that it might.  One plaintiff’s attorney argued that a former manufacturer’s duty should depend on how much a more robust warning would have affected the sale price of the product line.  We did not follow counsel’s reasoning, and we would be surprised if the Court did either.

In rebuttal, the defendant reiterated that the issue is duty, that it is the role of the Court to define duties and set limits, and that the plaintiff had offered no viable protection against perpetual liability. We agree.  These are not jury questions.  In the end, it will be a split decision, but we know how we would vote.  The law cannot justify creating an unprecedented duty of care for a company that did not sell the product that allegedly harmed the plaintiff and no longer sells the subject product at all.  The plaintiff’s remedy is against the manufacturer and seller of the product that she allegedly used and that allegedly resulting in an injury, just as it always has been under California product liability law.  We understand that this will not always give the plaintiff a complete remedy.  The manufacturer could be bankrupt or outside the jurisdiction of the court, and in some cases federal regulation of prescription drugs will preemption state-law claims.  But California has guidelines on when duties exist and when they do not.  We call them the Rowland factors, and they do not predict that a plaintiff will have the right to full recovery in every case.  So it should be here.  The opinion should be out in about 90 days.

Maybe we should not be surprised when courts within California reach to find personal jurisdiction over out-of-state corporations even when non-Californians sue. That is what BMS v. Superior Court was all about.  Right?  Well, it happened again last week in Dubose v. Bristol-Myers Squibb Co., No. 17-cv-00244, 2017 WL 2775034 (N.D. Cal. June 27, 2017), and it has us scratching our heads.

This is not an obscure issue. We know from Bauman that a company is subject to general personal jurisdiction only where it is “at home,” which means state of incorporation or principal place of business.  (You can view our post-Bauman personal jurisdiction cheat sheet here.)  And the Supreme Court famously held just two week ago in BMS that California’s courts cannot exercise specific personal jurisdiction over an out-of-state defendant unless there is “an affiliation between the forum and the underlying controversy, principally, [an] activity or an occurrence that takes place in the forum State.” Bristol-Myers Squibb v. Superior Court, 137 S. Ct. 1773, 1781 (2017).  That means there must be a causal link between the defendant’s forum contacts and the alleged injury to the plaintiff.  Contacts with other people—even people taking the same drug—do not count.

That is what makes the order in Dubose so confounding.  In Dubose, a South Carolina plaintiff sued a New York pharmaceutical manufacturer in the Northern District of California alleging product liability claims arising from her use of a prescription drug in South Carolina.  This is Bauman and BMS all over again, right?  Well, the district court saw it differently because the plaintiff alleged that the defendant conducted clinical trials within California, which became “part of an unbroken chain of events leading to Plaintiff’s alleged injury.” Dubose, at *3.  The district court therefore found specific personal jurisdiction based on those clinical trials, and it distinguished BMS v. Superior Court on the basis that there were no California contacts alleged in that case sufficient to support jurisdiction.

Having found jurisdiction, the district court then promptly transferred the case to South Carolina, where it should have been filed in the first place. But even though the case ultimately came to the correct result—sending a litigation tourist packing—we question the court’s order finding jurisdiction for several reasons.  First, we cannot distinguish BMS as easily as the district court did.  The alleged California contacts in Dubose were clinical trials.  But what are clinical trials?  They are physicians prescribing drugs to patients.  Sure, the prescriptions are written under approved protocols and data is collected.  But a patient being treated in a clinical trial does not look all that different from a patient being treated outside a clinical trial.  The Supreme Court held in BMS that “the mere fact that other plaintiffs were prescribed, obtained, and ingested [the drug] in California . . . does not allow the State to assert specific jurisdiction.”  137 S. Ct. at 1871.  The clinical trial participants referenced in Dubose were similarly “prescribed, obtained, and ingested” the drug within California.

Second, the district court in Dubose came to its conclusion because the clinical trials purportedly were in the “but for” causation chain leading to the alleged injury.  But were they?  Pharmaceutical companies typically run clinical trials at centers throughout the world.  Were the data from the California clinical trials really a “but for” cause of a patient ingesting a drug in South Carolina at some later point in time?  Put another way, if the California clinical trials never occurred, would the product really not have come to market?  We don’t know, but our point is that the causal chain leading from a specific, geographically defined subset of clinical trials to an alleged injury seems tenuous at best.

Third, the district court’s order seems to hold that any forum contact is sufficient to support specific personal jurisdiction, so long as it can be related to the plaintiff in any way.  But recall that specific personal jurisdiction is grounded in due process, which asks whether it is fundamentally fair to hold a defendant to answer in a forum where it is not at home.  At some point, the affiliation between the forum contact and the claim can be so attenuated that it can no longer be said that one “arose from” the other.  That is what we think is going on in Dubose.

If specific personal jurisdiction exists in every state where a multi-center clinical trial occurred, then any plaintiff who used the drug conceivably could sue the manufacturer in any of those states—no matter where the manufacturer is based and no matter where the plaintiff resides or used the drug. In the one example the district court cited, that would translate to specific personal jurisdiction in 44 states. Dubose, at *3 (citing M.M. ex rel. Meyers v. GlaxoSmithKline LLC, 61 N.E.3d 1026 (Ill. Ct. App. 2016)).  That is not “specific” personal jurisdiction.  That more resembles the concept of universal jurisdiction that the Supreme Court condemned in Bauman.

It could not be more unlike the disciplined contours of specific jurisdiction set forth in BMS.  The proliferation of jurisdiction to a multiplicity of states allowed the litigation tourism problem to arise in the first place.  It is also what led the Supreme Court to reel in personal jurisdiction.  Moreover, while the district court observed that “it is not clear what the alternative would be,” we would say the alternative is that Plaintiffs can sue a defendant where the defendant is at home or in states where they reside or where they ingested the product and experienced alleged injuries.  The Supreme Court made this clear in BMS too, where it rejected the plaintiffs’ “parade of horribles” and held that its “straightforward application of settled principles of personal jurisdiction” left plaintiffs ample alternatives, whether suing alone or in combination with others.

The case is in South Carolina now, so we doubt this order will undergo appellate review. That’s unfortunate.  Another thing is that the district court in Dubose relied most heavily on the M.M. ex rel. Meyers order to support its finding of jurisdiction.  But M.M. is currently in the U.S. Supreme Court on a petition for certiorari.  In light of BMS, we would not be surprised if the Supreme Court granted cert., vacated the order, and remanded for further proceedings.  That would leave Dubose as even more of an outlier.

 

Finally, some good news out of California – at least when personal jurisdiction isn’t the issue.

Design and warning defects were the questions presented in Trejo v. Johnson & Johnson, ___ Cal. Rptr.3d ___, 2017 WL 2825803 (Cal. App. June 30, 2017), and the result, particularly on the design side, was much more to our liking.

Indeed, there may well not have been post-BMS personal jurisdiction in Trejo either, since the plaintiffs were Hondurans injured in Honduras.  It’s not clear from the opinion where the drug at issue – an over-the-counter (“OTC”) ibuprofen-based pain relief medication – was purchased.  Somewhere in the United States, we gather, and it was then sent as a “care package” to the purchaser’s Honduran relatives.  Trejo, 2017 WL 2825803, at *2.

The drug was eventually taken, in Honduras, by someone other than its intended user, and that person, the eventual plaintiff, subsequently suffered Stevens-Johnson Syndrome (“SJS”), a nasty condition that we’ve encountered frequently on this blog.  This particular exercise in litigation tourism was quite initially successful.  A jury awarded over $50 million (including $15 million in punitive damages), finding for plaintiff on negligent failure to warn, negligent design, and strict liability design defect under the so-called “consumer expectation” test and the risk-benefit test.  The defendant “won” (if you could call it that) on strict liability warning defect and design defect under the “risk/utility” test. Id. at *5.  California not only allows plaintiffs two bites at the warning apple on separate negligence and strict liability theories, but three bites at the design apple under separate negligence, strict liability/consumer expectation design defect, and strict liability/risk/utility design defect theories.  No wonder plaintiffs flock to the state.

On appeal, however, the plaintiff in Trejo lost it all.

The design defect rulings are the most significant for the rest of us.

First, Trejo becomes the fourth appellate court to hold that the impossibility preemption rationale of Mutual Pharmaceutical Co. v. Bartlett, 133 S.Ct. 2466 (2013), and PLIVA, Inc. v. Mensing, 564 U.S. 604 (2011), applies generally, and it not limited to generic drugs – the others being Sikkelee v. Precision Airmotive Corp., 822 F.3d 680, 703-04 (3d Cir. 2016) (airplanes); Yates v. Ortho-McNeil-Janssen Pharmaceuticals, Inc., 808 F.3d 281, 298 (6th Cir., 2015) (branded drugs), and In re Celexa & Lexapro Marketing & Sales Practices Litigation, 779 F.3d 34, 41 (1st Cir. 2015) (branded drugs). Trejo joins Sikkelee and Yates in applying Mensing/Bartlett to design defects.  And Trejo is the first appellate decision to apply Mensing/Bartlett specifically to OTC drugs.

This is a good direction for the law to be moving. No appellate court has held that Mensing/Bartlett is limited to design defects in generic drugs.

Here’s what the unanimous Second District Cal. App. panel in Trejo had to say about preemption:

While the FDCA contains an express preemption provision concerning OTC drugs (21 U.S.C. §379r) – with a great big exception that exempts “product liability” claims from preemption – express and implied preemption operate independently.  Thus the savings clause for “product liability” doesn’t preclude implied preemption where product liability claims are in conflict with federal law.  Trejo, 2017 WL 2825803, at *23 (“[t]he savings clause does not foreclose the possibility that conflict preemption may arise from federal sources other than . . . §379r”).

Plaintiff’s design defect claim was that the defendant shouldn’t have used ibuprofen at all, but rather dexibuprofen, an isomer of the drug in question, “even though the FDA has not approved dexibuprofen for sale in the United States.” Id. at *5.  That’s right – plaintiff articulated a blatant stop-selling claim of the sort Bartlett had held preempted, and the Court of Appeal called “barnyard expletive” on plaintiff’s tortured argument otherwise:

[Plaintiff] asserts that he did not argue that defendants “should have withdrawn [the drug] from the marketplace, or should have never sold it in the first place.”  This argument is merely a matter of semantics. No matter how plaintiff words his argument, the claim that defendants failed to sell dexibuprofen instead of ibuprofen requires the claim that defendants should have withdrawn [the drug] from the market because defendants could not have changed the active ingredient of [the drug] without undergoing an entirely new FDA drug application process.

Trejo, 2017 WL 2825803, at *21 n.20 (emphasis added).

The Bartlettindependence principle” also required preemption.  It was impossible for the defendant to do what plaintiff contended state law required (materially change the drug’s design) immediately because material design changes to OTC (and all) drugs (and medical devices) require the prior review by and approval of the FDA.  “[F]ederal law prohibited the manufacturer from taking the remedial action required to avoid liability under [state] law.”  Trejo, 2017 WL 2825803, at *25 (quoting Bartlett, 133 S. Ct. at 2476).  That ruling applied to all drugs:

Consistent with our conclusion that the savings clause . . . does not prevent the applicability of ordinary preemption principles in the nonprescription drug context, we agree . . . that Bartlett’s holding is not limited to prescription drugs.

Trejo, 2017 WL 2825803, at *25 (emphasis added).  The FDCA did not permit the defendant to substitute freely one active ingredient for another.  “Dexibuprofen therefore would be a new drug, requiring a new drug application.”  Id.

[F]ederal law prohibited defendants from changing the design of [the drug] by selling dexibuprofen without prior FDA approval.  Defendants accordingly could not have avoided design defect liability without violating federal law.  “FDA regulations provide that once a drug, whether generic or brand-name, is approved, the manufacturer is prohibited from making any major changes to the qualitative or quantitative formulation of the drug product.”

Id. (quoting and following Yates, 808 F.3d at 298).

Preemption applied because the defendant could not have acted “unilaterally” to make the design change purportedly required by state product liability law – whether design defect is measured by consumer expectation or risk/utility:

Thus, under federal law [citations omitted] defendants could not unilaterally change the chemical composition of [the drug] from ibuprofen to dexibuprofen in order to satisfy consumer expectations or to increase the benefits or decrease the risks of [the drug].  Nor could they be required to stop selling [the drug] in order to avoid state liability.  Plaintiff’s design defect claim accordingly is preempted.

Id. at *26 (Bartlett citations omitted) (after quoting from a half-dozen cases listed in our post-Levine drug preemption cheat sheet).

Moreover, after trying the case as a straight-forward “you should have designed the product differently” claim, plaintiff could not attempt to convert it to some kind of quasi-warning-based case.  Plaintiff had a real warning claim (which we’ll get to) and couldn’t convert one possible design related factor (presence of warnings) into the whole design ball of wax to avoid preemption after having tried a different case to the jury.  Id.

But there’s more on design first.

Second, as we mentioned, California allows plaintiffs generally to prosecute design defect claims on either a consumer expectation or risk/utility theory of liability.  Not anymore in prescription medical product cases after Trejo.  Trejo also held, quite apart from preemption, that the consumer expectation theory was inapplicable to complicated products such as OTC drugs – and thus, we would argue, a fortiori would be inapplicable to prescription medical products.

The consumer expectation test is only appropriate for products that “everyday experience” allows consumers generally to have safety expectations about:

[T]he consumer expectations test is reserved for cases in which the everyday experience of the product’s users permits a conclusion that the product’s design violated minimum safety assumptions, and is thus defective regardless of expert opinion about the merits of the design.

Trejo, 2017 WL 2825803, at *27 (quoting Soule v. General Motors Corp., 882 P.2d 298, 308 (Cal. 1994)) (emphasis original).  OTC drugs – let alone prescription products – aren’t that.  Plaintiff tried the case with expert witnesses, which is a no-no under the consumer expectation theory.  That plaintiff did so demonstrated the theory’s inapplicability.

The circumstances of [the drug’s] failure involve technical details and expert testimony regarding the effect of the product upon an individual plaintiff’s health, and the ultimate question of whether [the drug] was defectively designed calls for a careful assessment of feasibility, practicality, risk, and benefit.

Id. at *30 (citations and quotation marks omitted).  SJS was an “unusual reaction” to the drug, thus “expert testimony was required to explain plaintiff’s theory.”  Id.  “Accordingly, we conclude that the consumer expectation test should not have been applied.”  Id.

In light of this complexity, plaintiff’s excuse for consumer expectations fell in the same barnyard as his argument against stop selling preemption.  Simply testifying that “I didn’t expect to get hurt” didn’t cut it:

Plaintiff here contends that the consumer expectation test applies because the ordinary consumer does not expect to contract SJS/TEN from taking OTC [ibuprofen].  However, it could be said that any injury from the intended or foreseeable use of a product is not expected by the ordinary consumer.  If this were the end of the inquiry, the consumer expectation test always would apply and every product would be found to have a design defect.

Trejo, 2017 WL 2825803, at *29 (emphasis added).  A consumer cannot, by playing dumb, bootstrap himself into a consumer expectation claim.  “[T]he consumer expectation test does not apply merely because the consumer states that he or she did not expect to be injured by the product.”  Id. Admittedly, we haven’t seen that many California plaintiffs audacious (or desperate) enough to utilize consumer expectation theories against FDA-approved products; nonetheless we’re beyond pleased now to have explicit appellate authority precluding this theory of liability against our clients.

After Trejo, it becomes a lot harder for any plaintiff to pursue a design defect claim against a prescription medical product in California.  If the design considerations that go into OTC drugs are too complex and involved to allow use of the consumer expectation theory of liability, than that theory is even less available to more sophisticated prescription products whose risks and benefits are so esoteric that the FDA has concluded that they should be dispensed only after evaluation by medical doctors.  Likewise, the Mensing/Bartlett preemption rationale against design defects is equally applicable to all FDA regulated products.  Can a branded drug manufacturer change its product’s active ingredient – or any other aspect of the product that materially affects product safety?   No.  And neither can a medical device manufacturer.  Effectively, all design defect claims that could make a difference in a product liability action (that materially affect “safety”) require prior FDA review, and thus should be preempted under Trejo and the Mensing/Bartlett independence principle.

That’s still not all.  We still have Trejo’s disposition of the warning-related aspects of the verdict to discuss.

Third, the Court of Appeal unanimously held that the jury’s verdict for the defendant on strict liability warning defect was fatally inconsistent with its verdict for plaintiff on negligent failure to warn.  Trejo, 2017 WL 2825803, at *8-14.  From a national perspective, this result is less important than the design defect aspects we just finished with, because disposition of the warning claim has to do with the interaction of California’s peculiar warning-based legal doctrines, which still attempt to maintain a difference between negligence and strict liability in the warning context.  Most other states treat them interchangeably.

It’s still important in Trejo, however.  $50 million is $50 million.

Briefly – because the whole thing reeks of hair-splitting to us – “both the strict liability and negligence theories were premised on a single alleged defect.”  Id. at *8.  “[U]nder either a negligence or a strict liability theory of products liability, to recover from a manufacturer, a plaintiff must prove that a defect caused injury.”  Id. at *6.  However, “strict liability, which was developed to ease a claimant’s burden of proof, requires proof of fewer elements than negligence.”  Id.  Thus, negligence requires “an additional element, namely, that the defect in the product was due to negligence of the defendant.”  Id.  Where (as here) the claimed defect under both theories is the same, that means that strict liability simply eliminates an necessary element, so that “a positive verdict on the latter [negligence, is] difficult to explain if strict liability cannot be found.”  Id.

Exactly that happened in Trejo, and it cost plaintiff $50 million.  It wasn’t the first time, either.  A previous decision, Valentine v. Baxter Healthcare Corp., 81 Cal. Rptr. 2d 252, 262-64 (Cal. App. 1999), was directly on point, forthrightly holding that “[a]s a practical matter then, the difference in the two concepts [negligence and strict liability] is so small as to make no difference.”  Id. at 263.  The jury’s finding for the defendant on the “easier” warning defect claim was necessarily inconsistent with its finding for plaintiff on the “harder to prove” negligent warning claim.  Trejo, 2017 WL 2825803, at *14 (“The jury’s special verdict on negligent failure to warn is fatally inconsistent with its verdict on strict liability failure to warn and must be reversed.”).

Who knows what would have happened if this plaintiff had not insisted on more than one bite at the apple?  That’s what we’ll find out on retrial.  We have no idea when that might be however, since further appellate review in Trejo is certainly possible.  In this respect, we are reminded that Bartlett, like Trejo, was also an SJS case.

This post is from the Cozen side of the blog only.

The Third Circuit gets fraudulent joinder—as if the name of the doctrine isn’t enough to give it away. It refers to, quite simply, joining a defendant in a lawsuit for a purpose other than pursuing liability against that defendant. And so the Third Circuit, getting it, has established a standard for determining fraudulent joinder that considers more than simply whether the plaintiff’s complaint states a colorable basis for a claim against the defendant. It also considers whether the plaintiff has a good faith intent to actually pursue that claim. Earlier this month, we posted on a decision by a district court in the Third Circuit applying this standard to deny a plaintiffs’ remand motion.

Since then, in fact just last week, this standard once again played a pivotal role in a determination by a court in the Third Circuit—this time the Zoloft MDL court—that a plaintiff had fraudulently joined a defendant to defeat diversity jurisdiction. In Re: Zoloft (Sertraline Hydrochloride) Prods. Liab. Litig., 2017 U.S. Dist. LEXIS 94953 (E.D. Pa. June 20, 2017). In that case, California plaintiffs sued Pfizer entities, none of which were California citizens, in a California state court. That complaint would ordinarily have been removable to federal court based on diversity jurisdiction, but plaintiffs also sued a California defendant, the (possible) distributor McKesson. In theory, McKesson’s presence as a defendant would defeat diversity jurisdiction. But the defendants nonetheless removed the case to California federal court, from whence it was swiftly transferred to the Zoloft MDL in the Eastern District of Pennsylvania.

Plaintiffs filed their remand motion in that court, which sits quite snugly inside the Third Circuit. In considering plaintiffs’ motion, the court began by laying out the Third Circuit standard:

In order to establish fraudulent joinder, a defendant must prove that there is no reasonable basis in fact or colorable ground supporting the claim against the joined defendant, or no real intention in good faith to prosecute the action against the defendants or seek a joint judgment.

2017 U.S. Dist. LEXIS 94953, at *5-6 (emphasis added) (citing Boyer v. Snap-On Tools Corp., 913 F.2d 108, 111 (3d Cir. 1990)). The court focused on the second half of the standard: plaintiffs’ real intentions for suing McKesson. Importantly, the court had the history of the Zoloft litigation to consider. A large mass tort, maybe even a not-so-large one, inevitably creates a litigation history that will highlight litigation maneuvers and counsel that have used them.

Here, the litigation history was determinative. The same plaintiffs’ counsel, along with other plaintiffs’ counsel, had sued McKesson in other Zoloft cases and then not seriously pursued discovery from McKesson, at times even dropping it as a defendant:

[T]he Court has been made aware of no instance in which any of the numerous Zoloft plaintiffs have propounded meaningful discovery on McKesson in either state or federal court, even though some cases have gone to trial. This failure to seek discovery includes other cases brought by Plaintiffs’ counsel. The lack of discovery requests directed towards McKesson casts doubt on Plaintiffs’ intent to pursue claims against McKesson.

Even more significantly, the plaintiffs in numerous Zoloft cases have dismissed claims against McKesson both before and after the Court granted summary judgment in favor of Pfizer and another Defendant and the plaintiffs appealed to the Third Circuit. One of these cases had been filed by Plaintiffs’ counsel in this case.

2017 U.S. Dist. LEXIS 94953, at *9.

The court saw a pattern. It rejected plaintiffs’ arguments that the Federal Rules of Civil Procedure establish no discovery standard upon which to determine whether a party was properly joined, holding that, regardless, the court may consider relevant information from the history of the litigation to determine plaintiffs’ intent in suing McKesson. Id. at *10.

The court then coupled the historical failures of plaintiffs and counsel to pursue McKesson after naming it as a defendant with the lack of specific, particularized allegations against McKesson in the complaint to determine that McKesson had been fraudulently joined. With that, the court held that it, in fact, did have diversity jurisdiction over the case:

Plaintiffs here have asserted non-specific claims against McKesson, Plaintiffs’ counsel has in separate Zoloft actions failed to propound discovery on McKesson, and, most notably, Plaintiffs’ counsel has outright dismissed McKesson as a defendant in other state and federal Zoloft cases. The Court thus concludes that Plaintiffs lack good faith intent to prosecute their claims against McKesson. The Court finds McKesson to be fraudulently joined in this action, and therefore does not take McKesson into account during its diversity jurisdiction analysis. Without McKesson, there is complete diversity between Plaintiffs and Defendants, and no dispute that the amount in controversy exceeds $75,000. The Court thus has jurisdiction over this case.

Id. at *10-11.

Obviously, this standard, along with the growing list of decisions applying it to reject remand motions, is a useful tool available to defense lawyers involved in mass torts, particularly in the Third Circuit. Allegations that are sufficient to state a colorable claim against a non-diverse defendant may not be enough to save a case from removal. The litigation history matters. Did plaintiffs actually pursue discovery against the non-diverse defendant? Did plaintiffs dismiss the non-diverse defendant late in the litigation? Did plaintiffs’ counsel ever depose the non-diverse defendant or subject it to the lengthy stream of depositions that they no doubt took of the employees and executives of the defendant that was the real target? Did plaintiffs pursue summary judgment against the non-diverse defendant when they pursued it against the real target? Has plaintiffs’ counsel used this tactic in other mass torts and a court called them out on it? And so on. We like the Third Circuit’s standard because it takes account of reality, and we expect to see more decisions adopting and applying it.

Late last year we happily blogged about Utts v. Bristol-Myers Squibb Co., ___ F. Supp.3d ___, 2016 WL 7429449 (S.D.N.Y. Dec. 23, 2016), chiefly because it held that design defect claims against a branded prescription drug (Eliquis) were preempted under the impossibility preemption reasoning in PLIVA, Inc. v. Mensing, 564 U.S. 604 (2011), and Mutual Pharmaceutical Co. v. Bartlett, 133 S.Ct. 2466 (2013).  However, as we noted in that post, dismissal of the non-design aspects of complaint was with “leave to amend.” See also Utts, 2016 WL 7429449, at *1.

Of course, plaintiffs amended.

Now, they probably wish they hadn’t.

In a second opinion, issued earlier this month, the Utts litigation was dismissed a second time, this time with prejudice. Utts v. Bristol-Myers Squibb Co., ___ F. Supp.3d ___, 2017 WL 1906875 (S.D.N.Y. May 8, 2017) (“Utts II”).  Preemption was once again front and center, but this time an excellent preemption result was accompanied by a variety of equally pleasing common-law – California law – rulings.

Impossibility Preemption

First, preemption. Design defect claims had already been preempted under Mensing/Bartlett, as plaintiffs were reminded whenever they crossed the line into design-type claims. Id. at *1, 9, 10 n.10, 13 n.15, 16, 19.  But the major preemption issue this time around involved warnings – and whether any of the information that plaintiffs claimed required some kind of “better” warnings involved “newly acquired information” of the sort that a defendant could unilaterally add given the scope of the FDA’s “changes being effected” exception to preemption recognized in Wyeth v. Levine, 555 U.S. 555 (2009). See 21 C.F.R. §314.3(b) (known as the “CBE” regulation for drugs – note, there are similar CBE regulations for devices and biologics; we’ve discussed the device regulation here).

For a more detailed discussion of the “newly acquired information” aspect of preemption, see our post here about In re Celexa & Lexapro Marketing & Sales Practices Litigation, 779 F.3d 34 (1st Cir. 2015), which was the first appellate decision finding preemption where plaintiffs failed to come forward with any “new” information to support their warning claims. Utts II explained that, in the preemption context, “if the plaintiff can point to the existence of ‘newly acquired information’ to support a labeling change under the CBE regulation, the burden then shifts to the manufacturer to show by ‘clear evidence’ that the FDA would not have approved the labeling change made on the basis of this newly acquired information.”  2017 WL 1906875, at *9.

Plaintiffs threw a lot of mud at the drug and its manufacturer, but nothing they heaved against the wall stuck – everything plaintiffs cited all old information that did not go beyond what the FDA had before it when it approved the drug in the first place.

Why is that?

Basically, Eliquis is a next-generation anticoagulant, very effective at what it does, and not requiring the kind of dietary restrictions and constant blood testing that older blood thinners such as warfarin – originally sold as rat poison – do.  Utts II, 2017 WL 1906875, at *2 & n.4.  Unfortunately, the plaintiffs’ bar has decided that anybody needing anticoagulation therapy should be should only have such older drugs available, and has launched an ongoing litigation assault at practically every next generation anticoagulant (others include Xarelto and Pradaxa) – because of risks of serious and sometimes fatal bleeding inherent in what these drugs are supposed to do.

The FDA was well aware of the risks that Eliquis, like any other anticoagulant, could cause uncontrollable bleeding when it approved it. Indeed, the “label warns about the risk of serious bleeding no less than five times.” Id. at *3.  It “specifically warns about the risk of bleeding” during concomitant therapy “in conjunction with antiplatelet agents, such as aspirin.”  Id. at *4.  The labeling also “twice warns about the fact that there is no specific antidote” should serious bleeding occur.  Id.

That’s why plaintiffs lost in Utts II.

Basically, the well-known fact that anticoagulants carry with them serious bleeding risks is why none of the information that the plaintiffs in Utts II brought forward qualified as “new.”  “New” is defined in the FDA’s CBE regulation as “studies, events, or analyses [that] reveal risks of a different type or greater severity or frequency than previously included in submissions to FDA.  21 C.F.R. §314.3(b) (quoted at 2017 WL 1906875, at *8).  In the preemption context, “

  • “The table and the description from the ISMP report do not suggest − nor do the plaintiffs allege − that the real-world signal data for [the drug] shows a greater severity or frequency of bleeding events or deaths than previously disclosed in [defendant’s] submissions to the FDA. Accordingly, the information contained in this table does not constitute newly acquired information. Utts II, 2017 WL 1906875, at *13.
  • Plaintiffs argue “that the guidance regarding concomitant use of antiplatelet agents is inadequate because the label does not advise how or when to use combination therapy . . . or how commonly bleeding events will occur. This omission . . . was evident to the FDA when it approved the label and the plaintiffs have not identified any newly acquired information.” Id. (quotation marks and footnote omitted).
  • This observation does not constitute newly acquired information, as it simply speculates whether [drug] safety could be further improved. Id. at *14 (as to “improved dosage guidance”).
  • [E]mbolic-thrombotic events are . . . not bleeding events. Nor do the plaintiffs argue that any of this data comparing the incidence of embolic-thrombotic events . . . constitutes newly acquired information. Id. (footnote omitted).
  • [T]he findings directed towards the risk of ischemic stroke for [the drug] users do not constitute newly acquired information. Id. at *15.
  • [P]laintiffs do not allege, however, that this expert guidance contains, or is founded upon, any newly acquired information regarding reversal agents or the treatment of excessive bleeding.” Id.
  • “[P]laintiffs do not allege that this statement contains newly acquired information about what constitutes a safe residual drug level.” Id. at *16.
  • “[T]his article does not refer to any new information that would have permitted the defendants to amend the [drug’s] label. And, in their opposition to this motion, the plaintiffs do not argue that it does.” Id.
  • “[P]laintiffs do not contend that any of the five remaining documents . . . contains newly acquired information regarding an undisclosed risk of bleeding. Several of these articles merely express a desire for further investigation. Id.

Thus, although plaintiffs loaded up their amended complaint with no fewer than “34 warnings that the defendants allegedly failed to provide,” 2017 WL 1906875, at *11, there was no safety in numbers. None of their supposedly missing warnings was based on “newly acquired information” as defined and required by the FDA’s CBE regulation.

Because, plaintiffs could not point to any “newly acquired information” to support their warning-related allegations, those allegations fell outside the scope of the Levine CBE exception and were preempted, because under Mensing/Bartlett such warnings could not be added without prior FDA approval.  2017 WL 1906875, at *9.

Next, in accordance with practically all law, Utts II held that preemption could be decided on a motion to dismiss.  A “determination regarding preemption is a conclusion of law.” Id. at *19 (pointing out that Mensing had been decided on a motion to dismiss).  To the extent that the Third Circuit’s aberrant Fosamax decision was pertinent, it was distinguishable.  Fosamax was limited to “clear evidence” determinations, and in Utts II, because plaintiffs offered no “new” information, clear evidence was never at issue.  Id. at *19-20.  Finally, plaintiffs were “not entitled to discovery on preempted claims.”  Id. at *20 (discussing TwIqbal).

In a way, the new evidence requirement discussed in Utts II resembles the so called “public disclosure” requirement that is a defense to False Claims Act claims (see here for more discussion), except that the “newness” of the information in preemption of state-law warning claims is measured against the evidence presented to the FDA, as opposed to the public.

Buckman Preemption

Utts II also found fraud-on-the-FDA preemption under Buckman Co. v. Plaintiffs Legal Committee, 531 U.S. 341 (2001).  Plaintiffs ran from their blatant fraud-on-the-FDA allegations, asking that they “be read merely as evidentiary background.”  2017 WL 1906875, at *26.  The court read them as they were written (and no doubt intended), and found preemption:

Each of the statements on which the fraud claim is premised depends on statements made to and approved by the FDA. There is no newly acquired information that required or suggested that the allegedly fraudulent statements should be altered to remain truthful and non-fraudulent.  Accordingly, the fraud claims are preempted.

Id.

Other FDCA-Related Issues

On other FDCA-related issues, Utts II ends up on our Adverse Drug/Device Event cheat sheet because of its discussion of how voluntarily reported adverse events aren’t legitimate proof of causation:

Federal regulations advise that a report submitted by a manufacturer “does not necessarily reflect a conclusion by the [manufacturer] or FDA that the report or information constitutes an admission that the drug caused or contributed to an adverse effect.” 21 C.F.R. § 314.80(l).  As the FDA Website explains:

FDA does not require that a causal relationship between a product and event be proven, and reports do not always contain enough detail to properly evaluate an event. Further, FDA does not receive reports for every adverse event or medication error that occurs with a product. Many factors can influence whether or not an event will be reported, such as the time a product has been marketed and publicity about an event.

The Supreme Court has similarly warned that “[t]he fact that a user of a drug has suffered an adverse event, standing alone, does not mean that the drug caused that event.” Matrixx Initiatives, Inc. v. Siracusano, 563 U.S. 27, 44 (2011). I n sum, “the mere existence of reports of adverse events . . . says nothing in and of itself about whether the drug is causing the adverse events.” Id.

Utts II, 2017 WL 1906875, at *12.

In addition, Utts II contains an excellent discussion of the harmful effects of overwarning.  The need to prevent overwarning is the reason that the CBE regulation does not apply to all information, new or old, that could in some way “strengthen” existing warnings:

The FDA has recognized that “[e]xaggeration of risk, or inclusion of speculative or hypothetical risks, could discourage appropriate use of a beneficial drug . . . or decrease the usefulness and accessibility of important information by diluting or obscuring it.” Indeed, “labeling that includes theoretical hazards not well-grounded in scientific evidence can cause meaningful risk information to lose its significance.” For this reason, the CBE regulation requires that there be sufficient evidence of a causal association between the drug and the information sought to be added.

Utts II, 2017 WL 1906875, at *8 (all quotes from “Supplemental Applications Proposing Labeling Changes for Approved Drugs, Biologics, and Medical Devices,” 73 Fed. Reg. 2848 (FDA Jan. 16, 2008).

Another notable FDA-related aspect of Utts II has to do with so-called “comparative claims” – claims that one medication is better than another in some respect.  Plaintiffs often claim (as they did in Utts II) that there is some sort of duty to warn that ones product is less safe than its competition.  However, Utts II points out that the FDA does not permit such claims except when supported by specific types and amounts of scientific evidence.  “[A]ny claim comparing the drug to which the labeling applies with other drugs in terms of frequency, severity, or character of adverse reactions must be based on adequate and well-controlled studies.”  2017 WL 1906875, at *7 (citing 21 C.F.R. §201.57(c)(7)(iii)).  Further, “federal regulations do not require a manufacturer to include information about a competitor’s product or progress.” Id. at *16 (citing 21 C.F.R. §§201.56, 201.57, 201.80).

State-Law Warning Issues

Beyond its preemption and other FDCA-related aspects, Utts II has a load of other helpful holdings, mostly about California law.  The decision contains an excellent discussion of the state of the art defense.  2017 WL 1906875, at *10.  It also points out that, the California Supreme Court’s holding – quite apart from preemption – that as a matter of federal/state comity, warning liability does not exist as a matter of state law where the purported duty flies in the face of FDA regulation:

Even where a risk is “known” or “knowable” at the time of distribution, under California law, a manufacturer “may not be held liable for failing to give a warning it has been expressly precluded by the FDA from giving.” Thus, if the manufacturer disclosed to the FDA “state-of-the-art scientific data concerning the alleged risk” and the FDA determined, after its review, “that the pharmaceutical manufacturer was not permitted to warn − e.g., because the data was inconclusive or the risk was too speculative to justify a warning,” then the manufacturer could not be held strictly liable for failure to warn. “[T]he FDA’s conclusion that there was, in effect, no ‘known risk’ is controlling.”

2017 WL 1906875, at *11 (all quotations from Carlin v. Superior Court, 920 P.2d 1347 (Cal. 1996)).  Thus, the same grounds that support preemption as a matter of federal law – where, as here, the FDA says “no” – also preclude liability as a matter of state law.

In tandem with preemption, Utts II also holds that the defendant’s drug labeling was adequate as a matter of California law on the bleeding issues raised by plaintiffs – just as our prior post thought it should.  In general, the label “clearly discloses that there is a risk of excessive bleeding and that there is no known antidote if that occurs.”  2017 WL 1906875, at *21.  Nor could plaintiffs prevail with any of the usual nitpicking that goes on in this type of litigation.

  • Monitoring – “The label provides, in unambiguous terms, all of the scientifically reliable information that physicians may need to determine how to monitor their patients.” Id.
  • Bleeding Reversal – A “recommendation is to discontinue [the drug] and apply ‘standard supportive treatment and other local measures’ . . . does not supply a basis for a plausible claim that the label needed to add further guidance.” Id. at *22 (quoting medical article).
  • Dosage – Plaintiffs do “not identify any research or data that undermines or contradicts the dosing guidance” and “speculation about information that the defendants may possess is insufficient to plausibly plead a claim.” Id. (citing TwIqbal).

Similarly, plaintiffs other warning-based claims failed due to the adequacy of the warning.  Id. at *24 (implied warranty), *26-27 (fraud); *29 (consumer fraud)

Finally, here are some other California warning-related nuggets we can use:  (1) Under the learned intermediary rule, “a manufacturer discharges its duty to warn if it provides adequate warnings to the physician about any known or reasonably knowable dangerous side effects, regardless of whether the warning reaches the patient.”  2017 WL 1906875, at *11. (2) “[P]harmaceutical manufacturer[s] may not be required to provide warning of a risk known to the medical community.” Id. (quoting Carlin).  (3) “[W]arnings relevant to any breach of warranty claim are those directed to the physician rather than the patient.” Id. at *22 (quoting Carlin) (emphasis original).  (4) The opinion notes that the learned intermediary rule applies to California consumer fraud claims.  Id. at *28 n.32.

Looking Forward

Utts II contains by far the most detailed discussion to date of the interplay between preemption and the “newly acquired evidence” requirement of the FDA’s CBE regulation.  It would be notable for that reason alone.  However, it also finds the labeling adequate as a matter of law, which is second highly significant ruling in any prescription medical product litigation.  What’s more, since the entire Utts amended complaint is now dismissed with prejudice, not only Utts II, but also the original Utts design defect preemption ruling, is now appealable.

Any appeal would be interesting.  Every ruling in Utts II is double-breasted, in that preemption is bolstered by independent state law grounds.  That is not the case with design defect preemption in the original Utts decision, where preemption is the sole basis for dismissal.  Utts, 2016 WL 7429449, at *12.  So, if plaintiffs were to appeal, their only clean shot at preemption would involve their design claim.  In any event, the preemption rulings in both Utts (Yates v. Ortho-McNeil-Janssen Pharmaceuticals, Inc., 808 F.3d 281 (6th Cir. 2015)), and Utts II (Celexa, 779 F.3d 34) are supported by court of appeals decisions, as our preemption cheat sheet demonstrates.  At best, in a hypothetical appeal, we would get an affirmance and reinforcing appellate precedent supporting preemption in innovator drug cases.  At worst, there would be a circuit split, which would offer the further (double-hypothetical) possibility of additional Supreme Court review of what Utts II called the Levine “trilogy.”  2017 WL 1906875, at *9.  While we always prefer to win, whenever, however, and as quickly and as thoroughly as possible, we certainly would find another shot at innovator drug preemption in the Supreme Court an interesting proposition.

Today’s case is a partially published decision about a partial reversal of a plaintiff verdict in California. So, we are only going to discuss select parts of the decision. It’s a long one and there are large sections about plaintiff’s counsel’s misconduct during trial and excessive damage awards. It is also a joint medical malpractice and product liability case. So, when you strip away the rest, we get down to a handful of legal rulings that we are truly interested in.

The case is Bigler-Engler v. Breg, Inc., 2016 Ca. App. LEXIS 921 (Cal. App. Oct. 28, 2016) and involves the use of a cold therapy medical device, available only upon prescription. Plaintiff underwent arthroscopic knee surgery, following which her surgeon prescribed use of the device to aid in recovery. Id. at *5-6. Plaintiff rented the device from her surgeon’s medical practice. Id. at *7. Upon discharge after surgery, plaintiff was advised to use the device at a certain temperature “as much as possible.” Id. at *8. Plaintiff’s use of the device and the instructions she received from her surgeon are explained in more detail in the opinion, but ultimately, plaintiff developed severe skin damage that required multiple plastic surgeries and scar reduction surgeries. Id. at *9-13.

Plaintiff file suit against her surgeon, the medical practice, and the device manufacturer. The jury found against the manufacturer on plaintiff’s claims for design defect, failure to warn, and intentional concealment. Id. at *19. The jury also awarded punitive damages against the manufacturer on the intentional concealment claim. Id. On appeal, the court overturned the intentional concealment verdict, which also meant reversing the punitive damages verdict. But, the court upheld the trial court’s decision not to instruct the jury on the learned intermediary doctrine finding it did not apply to a medical device intended to be operated directly by the patient.

Continue Reading A Fraudulent Concealment Win Coupled with an Unfavorable Learned Intermediary Ruling

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

Choice of law doesn’t get too much attention here at the DDL blog. That is due in some part to the fact that there really isn’t a defense-oriented position to take on it. Which state’s law should apply is a very case-specific analysis and in any given case, you might come out differently. It really depends on which state’s law is more favorable to your legal arguments in a particular scenario. The second reason it probably doesn’t get much attention from us is that in most personal injury, products liability cases, plaintiff’s home state’s law governs – the law where the injury occurred.

But what about when a plaintiff lives in one state but seeks medical treatment in another. Not to be considered disparaging of the many excellent healthcare facilities in southern New Jersey (where this blogger resides), but when you live a stone’s throw from some of the leading specialists in the country who happen to be across the state line in Philadelphia, you take that ride across the Ben Franklin Bridge. That’s not an unusual situation, making the choice of law question of interest.

In Finnerty v. Howmedica Osteonics Corp., 2016 U.S. Dist. LEXIS 123071, *2 (D. Nev. Sep. 12, 2016), plaintiff, a resident of Nevada, sought medical treatment from an orthopedic oncologist located in California. Plaintiff had cancer in his left leg that required either amputation of the leg or a total knee replacement. Plaintiff opted for the replacement and defendant’s modular replacement device was implanted. Id. At the time of surgery, plaintiff was “clinically obese.” Id. The surgery took place in March 2005 and plaintiff had no complications until 2011 – over 6 years later. Id. at *2-3. In August 2011, plaintiff started working as a shuttle driver for a car rental company. The job required him to lift luggage, weighing up to 80 pounds, on a repetitive basis. Id. at *3. In December 2011, while lifting luggage, plaintiff heard a “pop” in his left knee. During revision surgery, it was discovered that the implanted device had fractured. Id. Plaintiff continued to suffer complications and eventually his left leg was amputated.

Plaintiff sued the device manufacturer alleging failure to warn, negligence, strict liability design defect, manufacturing defect, and breach of express and implied warranty. Id. Defendant moved for summary judgment on all counts.

Continue Reading An Interesting Choice of Law Question