We have written a lot about personal jurisdiction. We certainly haven’t lacked for defense favorable decisions since Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017). Its impact has been felt in many contexts – class actions, innovator liability, litigation tourism. And, as we discussed in our post here, “stream of commerce” jurisdiction has also taken a significant hit post-BMS. Today we add another case to the growing precedent that “purposeful availment” rather than the “fortuitous” conduct of third persons is (i) a difficult standard to meet and (ii) is required to establish jurisdiction.

In Morgan v. Trokamed GmbH, 2018 WL 4388457, at *1 (W.D. Wis. Sep. 14, 2018), plaintiff, a citizen of Wisconsin, sued the German manufacturer and the North American distributor of a Class II medical device used in laparoscopic surgery. The manufacturer moved to dismiss for lack of personal jurisdiction and both the plaintiff and the distributor opposed. It was undisputed that the manufacturer had no offices or employees in Wisconsin, no representative of the manufacturer had ever visited Wisconsin, and the manufacturer doesn’t ship products to Wisconsin. Id. at *2. So, for plaintiff to make a prima facie showing of specific jurisdiction, she had to show that the German company had “purposefully availed” itself of conducting business in Wisconsin. The court analyzed each of plaintiff’s allegations of contact.

Exclusive distribution agreement: Plaintiff’s first argument was a straight-forward stream of commerce theory. The manufacturer gave the distributor exclusive rights to sell the manufacturer’s medical devices in the U.S., Canada, and Mexico. Based on that, the manufacturer should have reasonably expected its products to be sold in all 50 states. Id. But, as the court points out, that’s the same argument made by Justice Ginsburg in her dissent in J. McIntyre Mach., Ltd. v. Nicastro, 564 U.S. 873 (2011). But, the plurality (Kennedy, J.) and concurring (Breyer, J.) opinions found nationwide transmission insufficient to confer jurisdiction tethered only to a prediction that a defendant should have known its product would reach a specific state. Id. at *3.

Plaintiff tried to distinguish Nicastro by arguing that the manufacturer here exhibited more control over the distributor, but the court found nothing in the distribution agreement that showed targeting of Wisconsin particularly. The agreement covered the U.S. as a whole and did not direct the distributor to sell the devices in Wisconsin which is “the type of control that matters under a personal jurisdiction analysis.” Id. at *4.

Sales Volume: Plaintiff next tried to distance herself from Nicastro by pointing out that the plurality and the concurrence relied on the small number of sales of the product to New Jersey in deciding personal jurisdiction was lacking. Id. But, plaintiff here could only identify 2 sales of the manufacturer’s medical device in Wisconsin. Id. So, she focused on disposable components (blades and valves) of the device that she claims the distributor “regularly” sent to Wisconsin. This argument failed for several reasons, including that plaintiff neglected to produce any evidence that the components were manufactured by the German defendant. Id. at *5. Plaintiff also doesn’t allege that her injury had anything to do with the component parts, “so those sales would have a more tenuous connection with her claims.” Id. Finally, plaintiff still had no evidence that the manufacturer was aware it had customers in Wisconsin at the relevant time. Plaintiff alleged that the manufacturer became aware of its Wisconsin customers in 2015, but plaintiff “does not explain how knowledge that [the manufacturer] had in 2015 could serve as the basis for an exercise of jurisdiction for a claim arising out of 2014 injury ad a [device] sale made years earlier.” Id.

             Instructions for Use: Relying on Justice Breyer’s concurrence in Nicastro that offering “special state-related . . . advice” might be enough to confer jurisdiction, plaintiff alleged that the manufacturer “established channels of advice” via its warranty and Instructions for Use. Id. at *6. What plaintiff missed, however, is that the instructions “direct the customer to send the device to [the distributor] for repairs,” the instructions have the distributors contact information and logo, and state that the device is a product of the distributor. “No one reading the [instructions] would know that he or she should contact [the manufacturer] for any reason.” Id. at *7.

FDA Approval: Perhaps the most significant part of the opinion is the court’s conclusion that “the process for FDA approval does not provide a basis for exercising jurisdiction in a particular state.” Id. We’ve talked about this in the context of innovator liability, where the innovator may be the NDA holder, but they didn’t sell or distribute the product used by plaintiff. If the brand defendant didn’t sell the product at issue, but rather a different product to different people, and FDA-approval isn’t enough – what’s left on which to base specific jurisdiction?

Plaintiff also tried to use post-approval FDA communications to establish purposeful contacts. In response to a request from the FDA, the manufacturer had its distributor update all the instructions and send them to all customers. During this process, the manufacturer received a list of all of the U.S. customers for its devices. Id. at *8. Not only did this process take place after plaintiff’s alleged injury (after the relevant time period), it still relates only to the manufacturer’s contacts with the U.S. as a whole, not with Wisconsin. Id.

The bottom line: The facts alleged by [plaintiff], may reveal an intent to serve the U.S. market, but they do not show that [the manufacturer] purposefully availed itself of the [Wisconsin] market. Id. at *9 (quoting Nicastro).

Today’s case has a little bit of everything – choice of law, statutory compliance, alternative design, warnings causation. So, the decision is a bit of “grab bag” in addition to being a “mixed bag.”

The case is Hyde v. C.R. Bard, Inc., 2018 WL 3586404 (D. Ariz. Jul. 26, 2018). To begin with, plaintiff voluntarily withdrew several claims – manufacturing defect, breach of express warranty, failure to recall, and breach of implied warranty. Id. at *2. Defendant did not move for summary judgment on negligent design defect, negligence per se, or punitive damages – so those claims remain. That left failure to warn, misrepresentation and fraud, and strict liability design defect. Of those, only strict liability design defect survived. Id.

The court first had to decide which state’s law applied. Plaintiff was living in Wisconsin when she had the IVC filter implanted but did not experience any complications until after moving to Nevada. Plaintiff argued that Nevada law should apply as the location where the injury occurred. The court disagreed. Wisconsin, the forum state, applies a two-step analysis for choice of law questions. First, are one state’s contacts so minimal that applying that state’s law would be “officious intermeddling.” Id. The court found both states to have significant contacts with the case and so moved on to step two. This consists of the analysis of 5 factors. The court found three factors (maintenance of interstate order, simplification of the judicial task, and application of the better rule of law) to be neutral. Id. at *3-4. And the remaining two favored Wisconsin. As to predictability, the IVC filter was sold in Wisconsin, implanted in Wisconsin, and defendant’s interactions with the implanting surgeon took place in Wisconsin. So, defendant could reasonably expect Wisconsin law to apply to any products liability claims arising from the use of the filter. Id. at *4. As to the forum state’s interest, Wisconsin “has a strong interest in having its laws applied to corporations transacting business with the state. Id.

 Wisconsin’s product liability statute provides a presumption that a product is not defective if it complied with relevant standards or specifications approved by a state or federal agency – such as the FDA. Defendant therefore argued that because the IVC filter was cleared by the FDA via the 510(k) process, the presumption applied. The court however, refused to apply the statutory compliance presumption because the 510(k) process is not a safety review and therefore defendant was not entitled to the non-defectiveness presumption. Id. at *6.

Another defense to strict liability claims in Wisconsin is that the harm was caused by a known and inherent risk. Defendants argued, citing to publications, FDA documents, and plaintiff’s surgeon’s testimony, that the very complication suffered by plaintiff was well known in the medical community. Id. at *7. Plaintiff countered that while the general risk may be known, the fact that defendant’s filters had a higher adverse event rate than other filters was not known. The court decided that any challenge as to incident rates is a triable issue of fact for the jury. Id.

Turning to plaintiff’s burden of proof, to maintain a claim for strict liability design or warning defect, plaintiff has to establish that the risk of harm could have been “reduced or avoided” with a “reasonable alternative design or warning.” Id.   In this case, plaintiff’s expert pointed to anchors that were added to other of the defendant’s IVC filters as a specific and available alternative design. Defendant argued that plaintiffs in the litigation claim that those other IVC filters also are defective. Essentially plaintiff relied on an allegedly defective design as the alternative to the allegedly defective design at issue. Id. That feels like it should be a non-starter. But the court said that the alternative design only has to “reduce” the risk of harm. Id. So, if the alternative is slightly less defective that appears to be enough. Again, a bit of a head scratcher.

Moving on to failure to warn, the court found plaintiff’s claim failed for lack of evidence of causation. The court skirted the issue of learned intermediary, on which the Wisconsin Supreme Court has not ruled, finding that plaintiff identified no evidence that either plaintiff or her surgeon would have changed his/her decision regarding implanting the device. Id. at *8-9. In fact, plaintiff’s surgeon testified that he didn’t recall which filter was used or who made the decision to use that filter. He further testified that he trusted the FDA, the device was meeting the expectations of the FDA, and he wouldn’t have deferred implanting the filter where it was medically necessary. Id. at *9. Put all together, there was nothing in the record to establish that a warning about greater risks would have affected either the surgeon’s or the plaintiff’s decision to use the product.

That same rationale carried over to plaintiff’s misrepresentation and fraud claims where reliance is an essential element. Plaintiff never received any independent information from the defendant nor did she point to any information from the defendant on which her surgeon relied. Id. at *10.

So, the case remains although substantially cutback. Just two quick observations from reading between and outside the lines of the opinion as to negligence per se, on which defendant did not move for summary judgment. First, if 510(k) clearance doesn’t involve “safety,” how can negligence per se apply? It would seem that following the court’s logic, the 510(k) process does not rise to the level of a substantive standard of care that can support plaintiff’s negligence per se claim. Second, back in March we reported on another partial summary judgment win in the Bard IVC Filter MDL. In that case, this same court granted summary judgment on negligence per se finding that the claim could not be based on alleged FDCA violations because there is no private right of action to enforce the Act. See prior post here. From an outsider’s perspective, it feels like negligence per se should be out of this case as well.

The district judge in the In re Zimmer Nexgen Knee Implant Products Liability Litigation MDL issued a summary judgment order in October 2016 that we called “the best Wisconsin law decision we have ever seen.”  What was the reason for our unusually unbridled enthusiasm?  The district judge debunked the idea that the learned intermediary rule does not apply in Wisconsin.  We have often heard that refrain, but we have always been skeptical.  The truth is that Wisconsin’s appellate courts have not addressed the issue, and the In re Zimmer Nexgen judge predicted that Wisconsin’s Supreme Court would adopt the learned intermediary rule if given the opportunity.

The Seventh Circuit has affirmed that order, so its opinion now inherits the mantle of “Best Wisconsin Law Decision We’ve Ever Seen.” That title is cemented not only by the adoption of the learned intermediary doctrine, but also the rejection of a heeding presumption, which is also very helpful.  We note that the three judges who issued this opinion have spent a combined 83 years on the Court of Appeals and that the author of the opinion spent five years on the Wisconsin Supreme Court.  Maybe the latter fact was considered when assigning the opinion; maybe it was not.  Regardless, it is a clear-minded and well-reasoned opinion that we commend to anyone who has grappled with warnings claims in Wisconsin.

Here is what happened. The plaintiff sued a knee implant manufacturer alleging design, manufacturing, and failure-to-warn claims after his prosthetic knee replacement loosened, which is a known complication of all joint replacement procedures. In re Zimmer Nexgen Knee Implant Prods. Liab. Litig., No. 16-3957, — F.3d –, 2018 WL 1193431, at *1 (7th Cir. Mar. 8, 2018).  Following summary judgment, the plaintiff raised only the warnings claims on appeal and argued that the manufacturer failed adequately to warn both the plaintiff and his surgeon.

Of course, an alleged failure to warn the plaintiff raises the application of the learned intermediary rule, which “holds that the manufacturer of a prescription drug or medical device fulfills its duty to warn of the product’s risk by informing the prescribing physician.” Id. at *2.  Because neither the Wisconsin Supreme Court nor the state’s intermediate appellate courts have addressed the rule, the Seventh Circuit undertook an Erie analysis. Id. at *3.

Although we would like to believe that the Seventh Circuit reviewed our frequently updated 50-state survey on the learned intermediary rule, it is more likely the court did its own research or relied on that provided by the manufacturer.  What it found was one Wisconsin trial court opinion applying the doctrine and noting its widespread acceptance. Id. at *3 (citing Staub v. Berg, No. 00-cv-0117, 2003 WL 26468454 (Wis. Cir. Ct. Jan. 6, 2003)).  The Court also found three federal district court opinions invoking the learned intermediary doctrine under Wisconsin law, and one case called Maynard v. Abbott Labs observing that “Wisconsin does not apply the learned intermediary doctrine.” Id. On this last point, the Seventh Circuit was particularly blunt:  “That statement is incorrect—the Wisconsin Supreme Court has never weighed in on the topic [and] Maynard itself is bereft of any analysis on the point.” Id.

The Seventh Circuit also relied on the learned intermediary doctrine’s “broad support in other jurisdictions,” including 48 states where the highest court or the intermediate appellate courts have adopted the doctrine in some form. Id. Finally, the rationale for the learned intermediary rule applies even more forcefully in cases involving surgical implants because “it is not reasonably conceivable that an individual could obtain and implant a device that requires a trained surgeon without the intervention of a physician.” Id. Amen.

The following holding and the reasoning upon which it is based are what make In re Zimmer Nexgen the Best Wisconsin Law Opinion We’ve Ever Seen:

In short, there is good reason to think that given the opportunity, the Wisconsin Supreme Court would join the vast majority of state supreme courts and adopt the learned-intermediary doctrine for use in defective-warning cases like this one involving a surgical implant. We predict the state high court would do so.  Accordingly, to the extent that [the plaintiff’s] defective-warnings claim is based on [the manufacturer’s] duty to warn him, it is foreclosed by the learned-intermediary doctrine.

Id. at *4.  For good measure, the Seventh Circuit held that the plaintiff’s direct warnings claim failed also because the plaintiff did not identify any danger about which that the manufacturer should have warned him and because he had no evidence of causation.  Even if the plaintiff would have heeded a different warning, “[he] didn’t select the NexGen Flex implant.”  His surgeon did.  Id.

The Seventh Circuit likewise rejected the plaintiffs’ argument that the manufacturer failed adequately to warn the surgeon.  The plaintiff cited the defense expert’s testimony that he would have used more cement to place the implant and argued that the manufacturer failed to warn about the amount of cement needed. Id. at *4.  But that was not sufficient because “no evidence supports [the plaintiff’s] contention that it was [the manufacturer’s] responsibility to instruct surgeons about the amount of cement they should use.” Id. at *5.  This surgeon relied exclusively on his education and training, not on any materials from the manufacturer, and the plaintiff offered no expert opinion that the warnings were inadequate in any event. Id.

Finally, the Seventh Circuit rejected the warnings claims on causation. The surgeon did not read the instructions for use and could not been affected by a different warning. Id. at **5-6.  The plaintiff urged the Seventh Circuit to apply a “heeding presumption,” i.e., a presumption in the absence of proof that the surgeon would have read and heeded a proper warning. Id. at *5.  But Wisconsin law squarely places the burden of proving causation on the plaintiff.  As the Seventh Circuit held,

Here again, the state appellate courts have not addressed this doctrine [the heeding presumption]. We seriously doubt that they would adopt it in this context.  [¶]  To the contrary, as we’ve already noted, the state court of appeals has recently held that “[a] plaintiff who has established both a duty and a failure to warn must also establish causation by showing that, if properly warned, he or she would have altered behavior and avoided injury.”

Id. (citing Kurer v. Parke, Davis & Co., 679 N.W.2d 867, 876 (Wis. Ct. App. 2004)).  In other words, since Wisconsin law already places the burden of proving causation on the plaintiff, the Seventh Circuit would not alter that law by creating a presumption.

The plaintiff’s last request was to certify questions to the Wisconsin Supreme Court, which the Seventh Circuit rejected because “[n]o genuine uncertainty exists here.” We could not agree more and would not be surprised to see this opinion on our Ten Best list at year end.

This post is from the non-Dechert side of the blog.

While the recent Pennsylvania Superior Court Risperdal decision is not a defense victory, it is certainly not as favorable for plaintiffs as they are making it out to be. While several issues were presented for appeal in Stange v. Janssen Pharms., Inc., 2018 Pa. Super. LEXIS 11 (Pa. Super. Jan. 8, 2018), the most important one was whether the trial court was incorrect in applying New Jersey law to plaintiff’s punitive damages claim. While plaintiffs are characterizing the decision as answering that question in the affirmative, what the court really said was maybe.

In the consolidated In re Risperdal litigation pending in the Philadelphia Court of Common Pleas, the coordinating judge granted defendants’ motion for summary judgment on punitive damages finding that the law of New Jersey, defendant’s principal place of business, applied and that under the New Jersey Product Liability Act, punitive damages are precluded in cases involving FDA approved products. Id. at *32-33. In opposition to defendants’ motion, plaintiffs argued the law of the case doctrine or in the alternative that the court should apply Pennsylvania law instead. Id. Their law of the case argument was based on the judge’s decision in three prior Risperdal cases to apply the punitive damages law of plaintiff’s home state. Id. at *35n.6. The trial court ruled that those cases were separate cases and therefore law of the case did not apply or if they were considered the same case as In re Risperdal, the same judge made all four rulings and a judge is entitled to revisit his earlier rulings “without running afoul of the law of the case doctrine.” Id. (citation omitted).

With that ruling in place, the Stange case went to trial with no punitive damage claim. Stange is a resident of Wisconsin which is where he was prescribed Risperdal and treated for his alleged injury, gynecomastia. Unlike New Jersey, Wisconsin does not have a bar on punitive damages for FDA approved products. Under Wisconsin law, however, punitives would be capped at twice the amount of any compensatory damages or $200,000, whichever is greater. Id. at *42. So, there is a clear conflict of law.

On appeal, plaintiffs argued that the trial court’s global ruling on punitive damages was improper because Pennsylvania law on choice of law requires an analysis of which state has the greatest relationship and interests in each individual plaintiff’s case and that that analysis supports applying plaintiff’s home state’s punitive damages law. Id. at *33. Plaintiffs did not argue for application of Pennsylvania punitive damages law on appeal. Id. at *43n.8. Defendants argued that plaintiffs’ choice of law argument had been waived because it was first raised in plaintiffs’ motion for reconsideration of the global punitive damages ruling. Id. at *37. The Superior Court, however, found plaintiffs’ arguments preserved. In the context of their law of the case doctrine argument which urged the court to follow its earlier decision to apply plaintiff’s home state law, plaintiffs “argued more generally that the law of the plaintiffs’ various home states should apply to punitive damages.” Id. at *39.

So, what the Superior Court concluded was that the choice of law analysis was not waived and that a choice of law analysis as between New Jersey and Wisconsin needed to be undertaken:

the trial court only considered whether New Jersey or Pennsylvania law should apply, not the law of the individual plaintiff’s home state. We agree with Stange that it is necessary to remand for the trial court to allow Stange to develop an individual record on choice-of-law as it relates to his unique circumstances and to set out the facts and state interests important to his particular case.

Id. at *45. Nowhere in the decision does the court make any finding with regard to what the outcome of the choice of law analysis should be on remand, only that the analysis needs to be done. There is nothing prohibiting the trial court from reaching the conclusion in Stange that it did in In re Risperdal globally – that New Jersey has the more significant relationship and interests on the punitive damages claim. Indeed, having reached that decision once already we struggle to understand how the facts of any particular case will impact the court’s analysis. For the underlying substantive claims, most choice of law analyses will favor plaintiff’s home state – where he was prescribed, where he suffered his injury, where he was treated. But the alleged corporate misconduct giving rise to the claims for punitive damages occurred in New Jersey. It is there that the company developed the Risperdal labeling and its marketing and sales strategy and from there that it had communications with the FDA. Id. at *44.  So, even on a case-by-case basis, there is ample support for a finding that in a failure to warn case, the proper focus for purposes of a choice of law analysis on punitive damages is the place where the alleged corporate misconduct occurred.

So we think plaintiffs are celebrating a bit prematurely. The Stange decision may have removed the foil and even loosened the wire cage, but the cork remains in place.

As we noted at the outset, punitive damages choice of law was not the only issue on appeal and so we make passing mention of two other noteworthy aspects of the case. First, defendants challenged the trial court’s admission of certain expert testimony on the grounds it did not meet Frye standards. Id. at *8-9.  The Stange, court however erroneously applied the novelty limitation from Trach v. Fellin, 817 A.2d 1102 (Pa. Super. 2003) – that Frye only applies to the most “novel” of scientific testimony. That narrow interpretation was rejected by the Pennsylvania Supreme Court in Betz v. Pneumo Abex LLC, 44 A.3d 27 (Pa. 2012), a case not cited in Stange.

Second, it was agreed that Wisconsin law governed the substantive claims in the case. While examining the issue of proximate cause on failure to warn, specifically whether plaintiff had carried his burden of proving a different warning would have changed plaintiff’s prescribing physician’s decision to prescribe, the court applied the learned intermediary rule which has never been adopted by any appellate court (only trial courts, which have split) under Wisconsin law. Id. at *22n.4 (no conflict between Pennsylvania and Wisconsin law on the scope of learned intermediary doctrine). We’ll add it to our learned intermediary “head count.”

Interestingly, it’s a case that is almost a year old that has us thinking about litigation tourism post Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017).   We know that plaintiffs’ forum shopping gamesmanship isn’t over. It’s just gotten a lot more difficult now that the Supreme Court has said non-resident plaintiffs can’t go suing non-resident defendants anywhere they want. The most straight forward way for plaintiffs to stay out of federal court, assuming that is their goal, is to sue in defendant’s home state. Per the forum defendant rule, even where diversity exists, a defendant cannot remove a case to federal court if one of defendants (properly joined and served) is a citizen of the state in which the case was filed. See 28 U.S.C. § 1441(b). Stuck in state court, which isn’t always a bad thing, defendants then need to carefully consider forum non conveniens and choice of law issues.

Those were both key issues defendant decided to move on in Yocum v. Biogen, Inc., 2016 WL 10517110 (Mass. Super. Dec. 14, 2016). The case only recently popped up in our searches but with the likelihood of seeing more litigation filed in defendant’s backyards, we thought it worth a quick mention. Plaintiff brought a wrongful death suit in Massachusetts alleging that his wife died as a result of side effects from defendant’s drug used to treat her multiple sclerosis. Id. at *1. Plaintiff resides in and decedent received treatment and died in Wisconsin. Defendant’s principal place of business is in Massachusetts. Id. Just because defendant couldn’t remove the case to federal court, it still had some decisions to make. Such as, would it prefer the case to be litigated in Wisconsin. And, if it couldn’t move the case west, should Wisconsin law still apply. Yes and yes were the answers for this defendant.

First up was a motion to dismiss on the grounds of forum non conveniens.   Defendant’s argument was that not only was Wisconsin an available alternative forum, but that both public and private interests favored litigating there as opposed to Massachusetts. Generally speaking, all things being equal, courts don’t disrupt a plaintiff’s choice of forum. So, where case-specific witnesses like treaters and prescribers are in plaintiff’s home state and company witnesses are in defendant’s home state – most courts see that as a wash. See id. at *3. One set of witnesses or another are either traveling or being put on video. That’s not to say that this is always equal. For instance, if significant depositions of company witnesses have already occurred and won’t need to be repeated, maybe that helps tip things toward the plaintiff’s home state. Or, if the relevant company witnesses have changed jobs, retired, or otherwise moved, the defendant home state connection becomes more attenuated. Likewise, depending on the issues, a large company’s principal place of business might not be where the key company witnesses are located. These are likely the types of things a defendant is going to have to address to move the scales on the private interests.

Turning from the private interests to the public interests, defendant raised two arguments – the court would need to apply Wisconsin law and Wisconsin has a significant interest in regulating tortious conduct alleged to have occurred within the state. Taking them in reverse, the court found that Massachusetts has an equally significant interest in regulating the conduct of a resident business. Id. Another push. Left then with only choice of law, that alone is not enough to warrant a forum non dismissal. Defendant’s motion was denied.

That brings us to choice of law. If defendant can’t get to Wisconsin, it wanted to bring Wisconsin to it. Here the court agreed with defendant. We don’t usually take a definitive position on choice of law issues because frankly, our choice is likely to change case to case. So, we’ll just say that defendant did a good job of explaining why Wisconsin has the more meaningful contacts with the issues and the parties and that it is not an unusual conclusion for a court to decide to apply the law of the place where the injury occurred. Id. at *4-6.

Then we get to the substantive issues. Applying Wisconsin law, the court dismissed plaintiff’s breach of warranty and punitive damages claims. Wisconsin does not recognize breach of warranty for products liability suits. Id. at *6. Nor does Wisconsin recognize claims for punitive damages in wrongful death actions. Id. Both categories of claims, however, were dismissed without prejudice. Plaintiff was given an opportunity to try to re-plead the breach of warranty allegations as cognizable Wisconsin claims. And, since Wisconsin does recognize punitive damages for survival actions, plaintiff was getting another shot at that one too.

Finally, defendant also sought dismissal of the failure to warn claims as preempted. Defendant argued that the risks of the drug were considered by the FDA at the time of approval and that there was no newly acquired information that would have allowed defendant to change its label under the CBE regulations. Id. at *7. Therefore, it was impossible for defendant to comply with both federal and state requirements. But, this case is still at the pleadings stage and the court found that plaintiff had alleged enough to survive preemption. Specifically, plaintiff alleged that there were factual developments post-approval regarding the risks that would not have been considered at the time the FDA reviewed the drug and its labeling. Id. Further, the court found that defendant had not presented “clear evidence” that the FDA would not have approved a labeling change. Id. at *8.

It is worth noting, however, that the court did say that if plaintiff was pursuing a fraud-on-the-FDA type claim (failure to disclose risks to the FDA), that claim was preempted. Id. at *8n.12. Given that the court’s preemption decision was based on a very sparse record, we wouldn’t be surprised to see a round 2 on this issue after some discovery.

If defendants are going to see more home state litigation, even if forum non conveniens is a bit of an uphill battle – establishing choice of law early on may have several benefits. Dismissing claims is certainly one of them, but knowing what law is going to apply on issues such as learned intermediary and causation before discovery gets underway can be invaluable.

 

Last week, like most weeks during the past year, we spent a lot of our time on airplanes. One of those trips fell on a day with “lots of weather.”  All of our flights were delayed, although we were luckier than many.  When we landed at Dulles for our connecting flight home, the queue at the customer service booth comprised hundreds of stranded passengers looping around and around like the approach to Space Mountain, hoping, with varying degrees of impatience and panic, to reschedule canceled flights.  But our connecting flight was only late – very late.  We sat at our gate for almost three hours, then were finally allowed to board.  We buckled in, we watched a taciturn flight attendant demonstrate the seat belts we were already wearing, and then we sat.  For forty more minutes.  (By now, it was 12:30 a.m.)  Finally, the “flight deck” made an announcement:  we were sitting still because the trash can in the galley lacked a lid, and this was a “safety hazard” that had to be rectified before we could take off.  And so we were waiting for the “caterer,” a contractor, to bring a new trash can.  Eventually, a truck pulled up, but it was carrying the wrong type of trash can.  Ultimately, someone went next door to a plane that was done flying for the night — as all sane people were, by that point – and stole a trash can.  And we were on our way.

So who was at fault?   Was it the contractor, which (twice) provided the wrong trash can? Or was it the airline, which shall remain nameless because (trust me) it doesn’t need any more bad publicity and which specified and installed the trash can?  Depends on the nature of the claim, under a (very very) loose interpretation of today’s decision from the Eastern District of Wisconsin.

In Janusz v. Symmetry Medical, Inc., 2017 U.S. Dist. LEXIS 88895 (E.D. Wis. June 9, 2017), the plaintiffs alleged that the femoral neck of their artificial hips systems broke, requiring additional surgeries to replace the hip system.  The femoral neck was a component, manufactured by the defendant according to specifications and instructions provided by the hip system’s fabricator (which was bankrupt by the time of suit).  The plaintiffs asserted claims sounding in negligence and strict liability against both companies, and the component manufacturer moved for summary judgment, asserting the so-called “contract specification defense” to the plaintiffs’ claims.  This is a component part manufacturer’s defense, and not one we have ever discussed here.  Hence, our interest in Janusz.

Under this defense, a manufacturer that “makes a product strictly in accordance with the design specifications of another is not liable in negligence unless the specifications are so obviously defective and dangerous that a contractor of reasonable prudence would have been put on notice that the product was dangerous and likely to cause injury.” Januscz, 2017 U.S. Dist. LEXIS 88895, at *11 (citation omitted).  And, while this defense is not among the five defenses listed in Wisconsin’s product liability statute, the court held that the statute supplemented but did not supersede common-law doctrines that weren’t inconsistent with it.  While Wisconsin common law had not adopted the contract specification defense, either, it had adopted the “government contractor defense,” the underlying principles of which — declining to hold a contractor liable when it manufactured a product according  to the specifications of another – overlap those of the contract specification defense.  Under the government contractor defense, a contractor that “makes a product strictly in accordance with the design specifications of another is not liable in negligence unless the specifications are so obviously defective and dangerous that a contractor  of reasonable prudence would have been put on notice that the product was dangerous and likely to cause injury.” Id. at *12 (citation omitted).  This is essentially the same test used in the contract specification defense generally. See Restatement (Third) of Torts: Products Liability §5, Reporters’ Note to Comment a (1998) (a “majority of courts” hold “that a manufacturer of a component part . . . cannot be held strictly liable . . . so long as the specifications provided are not so obviously dangerous that it would be unreasonable to follow them”) (citation and quotation marks omitted).

In Januscz, however,  the court drew a distinction between negligence and strict liability that does not exist generally.  It held that, “[i]ntuitively,” it made sense that “an entity that has no role in designing a product should bear no liability if the product is defectively designed.” Id. at *12.  But “that intuitive  reaction follows only when plaintiff’s theory of recovery is negligence.” Id. (citations omitted).  And, “in Wisconsin, product liability was and is a matter of strict liability.” Id. at *13 (citations omitted).  In the strict liability context, unlike in negligence, “the focus is on the dangerousness of the product regardless of the defendant’s conduct.  Thus, a defendant may be blameless but strictly liable.” Id. (internal punctuation and citations omitted).  The court concluded that, given  the  “recent codification of product liability law reaffirming Wisconsin’s commitment to  the principles of  strict liability, if  presented with a question of whether the contract specification defense applies to a question of strict liability under Wisconsin law, the Wisconsin Supreme  Court would hold  that it does not.” Id. at *24. Januscz declared that “strict liability means strict liability.   It exists to shift costs associated with unsafe products to those  who are in the best position to disperse  those costs (be it through insurance, indemnification,  or some other means.” Id. at *25.  And, the court held, the “contract specification defense significantly undermines the policies underlying strict liability.  Therefore, the court concludes that the defense does not exist  under Wisconsin law.” Id. at *26.

This result is simply wrong under Wisconsin law. The Januscz court completely failed to cite the most relevant case, Schreiner v. Wieser Concrete Prod., Inc., 720 N.W.2d 525 (Wis. 2006), in which the Wisconsin Supreme Court expressly adopted Restatement Third §5 as “consistent with Wisconsin law.” Id. at 530.  Thus, Wisconsin law does not distinguish between negligence and strict liability, particularly in the context of product specifications and component parts. See also Spychalla v. Boeing Aerospace Operations Inc., 2015 WL 3504927, at *3 n.2 (E.D. Wis. June 3, 2015) (recognizing Wisconsin’s adoption of §5 after enacting of tort reform statute).  Indeed, after correctly holding that the Wisconsin tort reform statute only “supplements” the common law Januscz failed even to cite Restatement Third §5 – the relevant Wisconsin common law for component parts under Schreiner.  If anything, the statute reinforces use of the Third Restatement in Wisconsin, since the statute generally adopted that Restatement alternative design defect test and its “not reasonably safe” defect terminology. See Wis. Stat. §895.047(1)(a) (“A product is defective in design if the foreseeable risks of harm posed by the product could have been reduced or avoided by the adoption of a reasonable alternative design by the manufacturer and the omission of the alternative design renders the product not reasonably safe.”).

Rather than actually follow Wisconsin law, the court simply repeated the truism that “strict liability does not mean absolute liability.”  2017 U.S. Dist. LEXIS 88895, at *26 (emphasis in original).  To wit, a component manufacturer could escape liability if its component part underwent substantial change when it was included in the assembled device.  But, the court held, the defendant’s femoral neck component did not undergo such change.  And so the court denied summary judgment on the plaintiffs’ strict liability claims, though it granted summary judgment for the component manufacturer on the plaintiffs’ negligence claims.

While this interesting decision appears thorough at first glance, in fact it completely omits essential Wisconsin law, Schreiner and Restatement Third §5, and thus its discussion of the philosophical underpinnings of strict liability, based on Restatement Second §402A, which Wisconsin no longer follows, is (to be polite) open to question.  We hope that the defendant eventually convinces the court of the error of its ways.

 

Bexis, who took some lumps in probably the worst Wisconsin product liability decision ever (he filed PLAC’s amicus brief in Thomas v. Mallett, 701 N.W.2d 523 (Wis. 2005)), just read what we believe is the best Wisconsin law decision ever – at least in the drug/medical device sandbox that we inhabit. The decision is In re Zimmer Nexgen Knee Implant Products Liability Litigation, 2016 WL 6135685 (N.D. Ill. Oct. 21, 2016) (since the caption is a mouthful, we’ll call it “ZNKI“).

Here’s why ZNKI is favorable on Wisconsin legal issues.

First, as our longstanding 50-state survey on the learned intermediary rule points out, Wisconsin is one of nine states in which only federal courts predicting state law have had occasion to adopt the learned intermediary rule.  Looking more closely at these nine, Wisconsin is one of only two states (South Dakota being the other) where only federal district courts have reached this holding.  What isn’t there, but is discussed in ZNKI, is that some courts have (without much reasoning) refused to predict Wisconsin’s adherence to the rule.  Refusing to dodge the issue, ZNKI forthrightly examines both Wisconsin precedent and the general state of the law and concludes that Wisconsin would join the nationwide learned intermediary consensus:

[F]ederal courts applying Wisconsin law have reached different conclusions about the doctrine’s applicability.  The vast majority of states, however, do employ some version of the doctrine.  In addition, this court’s research suggests that those courts that have declined to apply the doctrine under Wisconsin law have done so in cases involving prescription drugs, not medical devices, and those courts offer no reason to believe that the Wisconsin Supreme Court would not adopt this majority rule if presented with the issue.

In the context of . . . surgery, a patient must rely on the experience and judgment of his or her surgeon, who selects the appropriate implant and educates the patient about the particular risks − based on the patient’s particular circumstances and physiology. . . .  Given that context, and given the widespread acceptance of the doctrine throughout the country, the court believes it is likely that the Wisconsin Supreme Court would apply the learned intermediary doctrine in this case.

ZNKI, 2016 WL 6135685, at *19-20 (numerous citations omitted).  As we’ve pointed out recently, the learned intermediary rule is, if anything, enjoying a renaissance, with thirteen straight state high court adoptions since the infamous Karl case (since overruled by statute) was the only supreme court to go the other way.

Continue Reading Probably the Best Wisconsin Law Decision We’ve Ever Seen

A federal judge in Wisconsin issued an order a few weeks ago that covers two topics on which we often write—negligence per se and implied preemption. The two concepts are not unrelated.  We most commonly see negligence per se when plaintiffs try to privately enforce a provision of the FDCA, i.e., by using an alleged violation of a safety-related provision of the FDCA as the basis for their state law claim.  State law does not always allow this, but even when it does, such a claim should not withstand implied preemption under Buckman.  That is because Buckman and section 337(a) of the FDCA make it clear that litigants cannot privately enforce the FDCA, and a negligence per se claim based on a purported violation of the FDCA is an unveiled attempt to accomplish exactly that.

It seems pretty straightforward to us, but some courts still resist. That is what happened in Marvin v. Zydus Pharmaceuticals (USA) Inc., No. 15-cv-749, 2016 U.S. Dist. Lexis 112047 (W.D. Wis. Aug. 23, 2016), where the plaintiffs based their negligence per se claim on the defendants’ alleged failure to provide medication guides for distribution with amiodarone prescriptions.  The basis for the claim was the federal regulation requiring manufacturers of some prescription drugs to make medication guides available either by providing a sufficient number of guides to distributors and dispensers or by providing the means to produce guides in sufficient numbers. Id. at **2-3 (citing 21 C.F.R. §§ 208.1, 208.24(b)).

The defendants allegedly did not provide medication guides to the decedent’s pharmacy, but do the decedent’s heirs have a private right of action? The defendants justifiably did not think so, and they moved to dismiss on the basis that the plaintiffs’ claims were impliedly preempted.  Along the way, the district court ordered supplemental briefing on whether Wisconsin law would recognize a claim of negligence per se in the first place.

We are fond of Wisconsin. We once drove from a deposition in Marquette, Michigan, to visit family in Minneapolis.  As students of the geography of the Upper Midwest will tell you, that took us across the entire width of Wisconsin.  One day we will return to partake of “fresh cheese curd,” which we saw advertised at multiple roadside markets along the way.  We have more recently learned that it is commonly deep fried and served at carnivals and county fairs across the region.

But for now, we will respectfully state that the district court in Marvin came to the wrong result.  The district court held first that federal law did not impliedly preempt the negligence per se claim, and in reaching that result, it cited and quoted extensively from the Seventh Circuit’s abominable Bausch opinion.  Faithful readers will be familiar with the disdain we have heaped on Bausch for, among other things, its recognition of a “parallel claim” based on even the most general FDA regulations and its blithe rejection of implied preemption without citing or even acknowledging section 337(a).  The posts are too numerous to list, but you can get the gist here and here.

Continue Reading Wisconsin Preemption Ruling Makes Our Cheese Curdle

We’re pleased to report that good things continue to happen in Atlantic County product liability proceedings following recent judicial turnover. On February 19, 2016, the Reed Smith Bard/Davol defense team scored a hat trick – going three for three on summary judgments in New Jersey hernia mesh litigation. The three decisions are: Goodson v. C.R. Bard, Inc., 2016 WL 743478 (N.J. Super. L.D. Feb. 19, 2016); Utech v. C.R. Bard, Inc., 2016 WL 743477 (N.J. Super. L.D. Feb. 19, 2016); and Yakich v. C.R. Bard, Inc., 2016 WL 743476 (N.J. Super. L.D. Feb. 19, 2016).

A bit of background. These three are not mass tort cases. They are examples of what happens when there is indiscriminate plaintiff-side advertising. People call up these 800 numbers because they had “mesh” implanted. They don’t have the targeted product but – what the hey? – it’s mesh and some of the raw materials are the same, so rather than turn away a potential plaintiff, the same attorneys file one-off cases against virtually every mesh product that exists, even if (as is true here) the particular product has been the medical standard of care for the relevant surgical procedure for decades.

As one might expect with pattern litigation, these three lawsuits, and thus these three opinions, look a lot alike. So we’ll concentrate on the Goodson opinion – if for no other reason than alphabetical order.

Continue Reading New Jersey Mesh Summary Judgment Hat Trick

A bit of a rant today.

We’ve just read Gibson v. American Cyanamid Co., ___ F.3d ___, 2014 WL 3643353 (7th Cir. July 24, 2014), and we have to say that it’s one of the most constitutionally arrogant decisions we’ve ever read.  Stripped to its essentials, Gibson is the judicial branch thumbing its nose at the supposedly co-equal legislative branch and saying “we can do it but you can’t.”

Gibson involves one of these seemingly one-way legal doctrines that only protects plaintiffs, but for some reason never defendants, the concept of so-called “vested rights.”  Here’s the back-story.

Thirty years ago, the Wisconsin Supreme Court, in a judicial exercise of social policymaking, decided to adopt a peculiar form of an already peculiar doctrine – market share liability.  See Collins v. Eli Lilly Co., 342 N.W.2d 37 (1984).  The court breached a hitherto (mostly) sacrosanct defense – product identification − that a defendant can’t be liable unless the plaintiff first proves that s/he actually used the defendant’s product.  The reason was … well, the usual fuzzy-headed logic that the common law can change and we think it’s better that the plaintiff wins.  Id. at 45 (we can change the common law), 49 (we’re gonna change the law and let the plaintiffs win because of “interests of justice and fundamental fairness”).  Despite the fact that the product was off the market and plaintiffs had taken it many years earlier, the court in Collins had no compunction in extending this new theory of liability retroactively to defendants whose conduct had previously been protected by the product identification defense.

Collins, as most of our readers probably already know, was a DES case.  DES was, for all intents and purposes, the world’s first generic drug.  Its patent had expired, so anybody who wanted to go to the time and effort to do so (this was the pre-1962 FDA, before NDA requirements were made a lot tougher) could set up shop and make the drug.  Scores of companies did, and “DES” became the reference of choice for most doctors and pharmacists.  Given the peculiarly long latency period for the peculiar injury – suffered in utero − in DES cases, product identification was a mess.  Collins decided to let the plaintiffs win anyway by shifting the burden of proof, contrary to decades (at least) of precedent.

At least in Collins there was a real product identification problem.  In the next case (the one ultimately at issue in Gibson), a bunch of class action lawyers decided to gin up a product identification problem.  They wanted to sue on behalf of everybody theoretically injured by lead paint, which had been off the market for a quite a while by the time suit was brought.  Since causation was an individualized issue that could defeat aggregated litigation, they created an impossible ID problem by skipping over the manufacturers of lead paint (some of whom might have been identifiable in building maintenance records) and sued only the bulk suppliers of lead paint pigment.

Continue Reading Court: It’s Only Unconstitutional If You, Not We, Do It