Fraud On The FDA

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The following is a guest post by Laura Mastrangelo at Reed Smith, who gets all the credit, and takes all the blame, for its contents.  Take it away Laura….

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There was a fair amount of preemption action on punitive damage statutes last week, at least with respect to those states that limit punitive damages for FDA approved drugs and devices.  John Sullivan provided excellent coverage of Zimmerman v. Novartis Pharmaceutical Corp., ___ F. Supp. 2d ___, 2012 WL 3848545 (D. Md. Sept. 5, 2012), yesterday here, so I won’t belabor that discussion further.  Flying more under the radar, though, the Sixth Circuit issued an opinion in Marsh v. Genentech, Inc., ___ F.3d ___, 2012 WL 3854780 (6th Cir. Sept. 6, 2012), which dovetails nicely with the District of Maryland’s analysis in Zimmerman.  In Marsh, the Sixth Circuit affirmed its previous holding in Garcia v. Wyeth-Ayerst Laboratories, 385 F.3d 961 (6th Cir. 2004), that the fraud exception to Michigan’s bar on products liability suits against drug manufacturers is preempted, even where Plaintiffs haven’t alleged fraud-on-the-FDA in the classical sense.

Plaintiffs brought consolidated products-liability actions against drug manufacturers Genentech, Inc. and Xoma (U.S.) LLC (collectively, “Genentech”) to recover for injuries allegedly sustained from use of the psoriasis medication Raptiva, alleging strict products liability under design-defect and failure-to-warn theories, negligence, breach of warranty, and fraud.  Id. at *1.  The action consolidated four different plaintiffs, but apart from their dates of use and alleged injuries, the allegations for the four were identical.  Id., n.2.

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Continue Reading More Punitive Damages Preemption, Sixth Circuit Reaffirms Garcia

The scope of Mensing is one of the hotter issues in drug and device law these days. (The Bartlett appeal is one example.) To our defense-hack eyes, Mensing seems perfectly straightforward: a claim is preempted to the extent it alleges that the risks of a generic drug were not adequately disclosed. But the doctrinal landscape…

Does Buckman v. Plaintiff’s Legal Committee, 531 U.S. 341 (2001), apply any time that a plaintiff raises a fraud on the FDA allegation in litigation, or is it limited to causes of action denominated “fraud on the FDA?  Most courts have agreed with the Sixth Circuit that Buckman applies across the board.  See , 385 F.3d 961 (6th Cir. 2004).  A persistent minority, however, has limited Buckman to complete “fraud on the FDA” causes of action.  See Desiano v. Warner-Lambert & Co., 467 F.3d 85 (2d Cir. 2006).  The Supreme Court attempted, but failed, to close the split in Desiano, but failed – splitting 4-4.  See Warner Lambert LLC v. Kent, 552 U.S. 440 (2008). Garcia v. Wyeth-Ayerst Laboratories

Both Garcia and Desiano involved the “fraud on the FDA” exception to a Michigan tort reform statute that imposes a presumption of adequacy on warnings that are FDA approved – that is, just about every warning.  The Michigan statute was essentially dispositive.

Then Texas passed a similar presumption statute that is almost as dispositive in the ordinary case as Michigan’s.  It was only a matter of time before the Fifth Circuit would be called upon to decide the same question as in Garcia/Desiano.

Also in the mix is the Supreme Court’s later, extremely anti-preemption, decision in Wyeth v. Levine, 555 U.S 555 (2008).

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Continue Reading Fifth Circuit Breaks Buckman Tie

In our rather terse (due to firm involvement) post on Monday concerning Merck & Co. v. Ratliff, ___ S.W.3d ___, 2012 WL 413522 (Ky. App. Feb. 10, 2012) – beating both BNA and 360 by two days, BTW – we mentioned the “interesting” aspects of that case.  Having noodled it a bit more, we’ve…

            We could have gone with “if at first you don’t succeed, try, try again.”  Or, Dory’s famous “Just keep swimming” from Disney’s Finding Nemo.  But, when talking about plaintiffs, slinging mud just feels more appropriate (to us).  And, I guess somewhere in here is a backhanded compliment about being persistent, but really we would

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A friend of ours, we’ll call him “Anonymous,” let us know about the recent decision in Forman v. Novartis Pharmaceuticals Corp., ___ F. Supp.2d ___, 2011 WL 2559386 (E.D.N.Y. June 27, 2011).  We reviewed it, and were somewhat taken aback that – after the court in Desiano v. Warner–Lambert & Co., 467 F.3d 85 (2d Cir. 2007), presumed to know more about Michigan law than either the Michigan courts (Taylor v. Smithkline Beecham Corp., 658 N.W.2d 127 (Mich. 2003)) or the Sixth Circuit (Garcia v. Wyeth-Ayerst Laboratories, 385 F.3d 961 (6th Cir. 2004)), with jurisdiction over Michigan – yet another court out of New York now presumes to know New Jersey law better than the New Jersey courts (McDarby v. Merck & Co., 949 A.2d 223 (N.J. App. Div.2008)), and the New Jersey federal courts, which have followed McDarby.  See Stanger v. APP Pharmaceuticals, LLC, 2010 WL 4941451, at *4 (D.N.J. Nov. 30, 2010); Baker v. APP Pharmaceuticals, LLC, 2010 WL 4941454, at *4 (D.N.J. Nov. 30, 2010); Haggerty v. Novartis Pharmaceuticals Corp., 2009 WL 5064779, at *4 n.4 (D.N.J. Dec. 15, 2009).

We made that point to our friend.

His response?

“Hey, its New York!  You’re looking for humility?”

We wouldn’t dream of going that far.  After all, we know more than a few Yankees fans.

We’d just like to see a little comity every now and then.

That would preferable to the current, absurd situation where, in a prescription drug case in Michigan, or in a punitive damages case involving drugs in New Jersey, the plaintiffs lose under those states’ application of the fraud-on-the-FDA preemption rule of Buckman Co. v. Plaintiffs’ Legal Committee, 531 U.S. 341 (2001), to their own law.  But if plaintiffs can somehow wheedle their way into court in New York, then the same claims survive.

We made this last point in our initial discussion of Desiano way back in 2006, where we urged federal courts to “remember federalism” and not construe state causes of action differently from the courts of those states.  With New York courts continuing to boldly go where no courts have gone before (or since), and forum-shopping plaintiffs following them, we think it’s time to review this issue.

First, Buckman (with the caveat that Bexis’ role in that case gives us more than the usual defense interest in its correct application).

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Continue Reading No Stand Up Comity In New York

We’ve blogged before about the split among Utah courts about whether Buckman Co. v. Plaintiffs’ Legal Committee, 531 U.S. 341 (2001), preempts the fraud on the FDA exception to Utah’s statutory bar (Utah Code Ann. §78B-8-203) against punitive damages where the product complies with FDA standards.

The first case, Grange v. Mylan Laboratories, 2008 WL 4813311 (D. Utah Oct. 31, 2008), got it right.  Buckman‘s rationale extends to any state-law assertion of fraud on the FDA that could bring about submission to the FDA of unnecessary and unwanted information due to fear of later tort liability.

Indeed, since punitive damages can (and often do) exceed compensatory damages in their amounts, allowing punitive damages based on fraud on the FDA is even more likely to bring about the prophylactic conduct that Buckman decried than the claim in Buckman itself – particularly since punitive damages are frankly intended to “deter” the conduct they punish – and thus create precisely what Buckman held was unacceptable.

The next case, Lake-Allen v. Johnson & Johnson, 2009 WL 2252189 (D. Utah July 27, 2009), botched the issue, for some reason asserting that Buckman involved express preemption.  We criticized this patently wrong result here.

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Continue Reading Utah Preemption Split Deepens

It’s Labor Day, the unofficial end to what has been a long, hot Summer. (Shakespeare wrote that “thy eternal summer shall not fade,” but this sweltering season has us saying, ‘please, please, fade away.’) We’re getting ready for the family BBQ and suspect that, as is often the case, the appetizers (salmon pinwheels, buffalo mozzarella) will outshine the more pedestrian main course.

The same thing happened in the case of Yocham v. Novartis Pharmaceuticals Corp., 2010 U.S. Dist. LEXIS 90005 (D. N.J. August 31, 2010). We like the minor rulings. But the main ruling on preemption makes us gag.

The plaintiff was a Texas resident who alleged that she developed Stevens-Johnson Syndrome from Lamisil. Her complaint asserted claims of negligence, strict liability, express and implied warranty, misrepresentation, unjust enrichment, and violations of the New Jersey Product Liability Act and the New Jersey Consumer Fraud Act.

Let’s start with the good bits. Plaintiff sought application of the law of New Jersey, where Defendant was located. Plaintiff lived in Texas, took the Lamisil in Texas, and sustained the injury in Texas. But Texas “does not permit design defect claims for prescription drugs with otherwise adequate warnings.” Yocham, 2010 U.S. Dist. LEXIS 90005 at * 13. So it’s no surprise that the Texas plaintiff shunned Texas law. Following the “most significant relationship” test, the Court didn’t have much difficulty choosing Texas law. Plaintiff put up a struggle, contending that the location of the injury was “fortuitous.” Id. at * 13-14. That’s sort of silly. It reminds us of people who misuse certain words, “fortuitous” often one of them. It’s almost as irritating as the misplaced “hopefully,” lodging “only” next to the wrong adjective or verb, or writing “alot” as one word.

One’s choice of residence is not “fortuitous.” The late, great comedian Bob Schimmel said it would be weird to show up at somebody’s house and claim it was “fortuitous” to find them there. The Restatement’s “example of fortuitous place of injury involves the purchase of an airline ticket to fly from one state to another part, which route happens to overfly a second state, that state has no relationship to the parties, and the only relationship to the occurrence is mere chance.” Id. at * 14. Bottom line: “It was not fortuitous that Plaintiff was injured in Texas, her state of residence.” Id.

We also like the way the Court dealt with the express warranty claim. The Court pushed the eject button because Plaintiff “has not adduced evidence of reliance.” Id. at * 39. Rather, Plaintiff “relied exclusively on the advice of her physician in deciding to use Lamisil.” Id. at * 40.

Now for the main course, which gave us indigestion. Under Texas law, there is a statutory defense to failure-to-warn claims aimed at FDA-approved warnings. The only exception to the defense requires a showing that the defendant misled the FDA. Is that exception preempted by federal law? Do you really need to ask?

In Buckman Co. v. Plaintiff’s Legal Committee, 531 U.S. 341 (2001), the Supreme Court “held that a state cause of action for injuries caused by misrepresentations made to the FDA was impliedly preempted by the [FDCA].” Yocham, 2010 U.S. Dist. LEXIS 90005 at * 22. Since Buckman was decided, the battleground has been state statutes, like that in Texas, providing a defense that is called off only if there was fraud on the FDA. That battle has largely turned out to be a debate between the pro-preemption position set forth by the Sixth Circuit in Garcia v. Wyeth-Ayerst Laboratories, 385 F.3d 961 (6th Cir. 2004), and the anti-preemption position set forth by the Second Circuit in Desiano v. Warner-Lambert & Co., 467 F.3d 85 (2d Cir. 2006), aff’d by equally divided court, 552 U.S. 440 (2008). We’ve written at length on this debate before and before and before that, so we won’t repeat ourselves here (at least not too much). Let’s leave it at this: the Garcia line of cases (which, thankfully, seems to be winning) is a straightforward application of Buckman, while the Desiano line tortures logic and policy.

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Continue Reading Barbecued Buckman